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Disadvantage: A Low ValuationThe standard pre-money valuation of a company accepted into Y Combinator is $250,000 ($15,000 raised for a 6% equity stake). By some measures, this seems like a very low valuation, especially when compared to angel and venture capital deals. Wilson Sonsini reports that the median Series A pre-money valuation was $6.0 million in 2006. However, the companies receiving these valuations are already established and are likely growing at a fast pace with a solid team in place. |