“If you can recognize good startup founders by empathizing with them—if you both resonate at the same frequency—then you may already be a better startup picker than the median professional VC.” —PG, How to Be an Angel Investor
Ryan and I both had our lives changed from going through Y Combinator. The talent network, ecosystem, and investment opportunities are unmatched.
The results speak for themselves. According to a recent report published by Pitchbook, since 2010 approximately 4.5% of the startups that went through Y Combinator became billion-dollar companies, surpassing other major accelerators. The unicorn creation rate was even higher, at around 5.4%, for cohorts between 2010 and 2015.
But one of the most unique things about YC that few outsiders understand is the collective power of its alumni community. As alums, we’re encouraged to support the next batch of founders—including making intros, sharing expertise, dogfooding new products, and for those who can, writing checks as investors.
It’s been this way since the earliest YC batches, by design. At Alumni Demo Day, founders get an opportunity to work out the kinks in their investor pitches before the actual demo day. But we aren’t just talkin’ bout practice—many alums in the audience could be seen typing out notes (shout out Evan Stites Clayton for your legendary demo day poems), whispering to each other about who they’re excited about, and writing checks before the thousands of outside investors have an opportunity to do so.
There are a lot of successful angel investors in the YC ecosystem, but it’s tough out there if you have limited liquidity to get into the best deals at demo day while writing relatively small ($5K-$10K) checks. As YC batch sizes have gotten larger, it’s also become increasingly challenging to index and diversify your investments across a broader portfolio.
So we decided to start Orange Collective - where ambitious YC alums could put our brains together and pool money to invest in the top companies of each batch, build a diversified portfolio, and participate in the upside of this amazing network.
For our inaugural batch of Winter 2023, we’re excited to announce our first 14 investments:
It’s difficult to comprehend all that’s happened in the world since the Winter 2023 batch began. At that time, the collapse of FTX was just starting to send waves through the crypto industry; Silicon Valley Bank was still a top banking partner for startups; and ChatGPT had not yet been launched by OpenAI.
Economic and technology cycles tend to repeat themselves, but despite the turbulence, the founders stayed focused on making something people want—with many pivoting and capitalizing on the AI platform shift.
As reports of VC funding cooling off generated FUD on Twitter, in real life we observed the opposite. Many of the deals we participated in were oversubscribed by demo day, and we’re fortunate to have co-invested alongside VCs and angels that we admire, including Sequoia, Initialized, Soma Capital, L2 Ventures, and SV Angel.
As Summer 2023 kicks off, and the FUD continues to linger, we believe now is the perfect time to create a world-changing company. Rapid advancements in AI are being made daily and transforming every industry; climate tech is growing and attracting founders determined to build hard tech companies or discovering opportunities that software can help unlock; and developers are building the missing tools they’ve needed for themselves, creating new runways for the builders of tomorrow.
As a YC alumni investment club, our aim stretches beyond simply maximizing returns. We hope to foster and strengthen the alumni community that YC planted the seed for, and give back to future founders in ways that we’ve wanted for ourselves.
To start, we’re committing to reinvest the fund’s management fees into our portfolio founders through a wellness stipend and connect them to our network of world-class executive coaches, like Amy Buechler, Brian Wang, and others, which members of the club have personally worked with (more on this later).
If you’re a YC alum and interested in learning more and getting involved with Orange Collective, we’d love to chat. If you’re a founder in the current batch… as Michael Siebel would say, get back to working on your startup! And we’ll be in touch soon ;)