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1M/1M: How We Differ From YCombinator

Posted on Monday, Jan 31st 2011

We are getting this question often: How does 1M/1M differ from YCombinator and other accelerators and incubators? Here is the answer:

First, 1M/1M doesn’t reject anybody. If you want to use the program to learn entrepreneurship, you can. YCombinator and almost all other accelerators are extremely selective and investment oriented. They work only on companies that are investment-worthy in their assessment. And they invest in and take equity in a small group of companies, and reject the rest.

Also, 1M/1M doesn’t invest in companies. We help companies become investment-worthy, or even develop strategies such that they can build sustainable businesses without any need for external investment, by connecting them to customers and channel partners. Overall, we believe customer financing – meaning, revenues – is better than equity or debt. Our focus is to delay your financing and help you to build value and valuation, rather than have you give up large chunks of equity upfront for little money.

Also, these days, unless you have adequate traction, you can’t really get funding.

We help you build traction, and when you are ready, we help you get financed. You can see examples on the Million Dollar Club page. Our most heavily funded company has raised $95 million in funding.

In addition, YCombinator requires that you move to Silicon Valley to be on location. We are a 100% virtual program.

Our business models are different. The investment-oriented incubators typically do not charge a fee to join, but they always take equity against a small investment (or no investment, just services). We charge a $1,000 annual membership fee for the premium program, but we do not take any equity.

If you have additional questions, please feel free to ask here or at a roundtable, and I will clarify further. Also, please take a look at this FAQ on the 1M/1M site.

This segment is a part in the series : 1M/1M

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Interesting business model, win win situation for everybody, especially helpful for non – US startups and also to the ones which have less access to mentoring resources.

Sainath Gupta Monday, February 7, 2011 at 4:16 AM PT

[…] I close today’s recap, I want to point readers to a blog post from last week explaining how 1M/1M differs from YCombinator and other such programs. It’s a question that we’re getting often, so I felt that it would be worthwhile to discuss it […]

One Million by One Million Roundtable Recap | Bellevue Business Journal Friday, February 11, 2011 at 10:48 AM PT