Cockroach Class

What’s with this name?

Well, for starters, it sticks and it sparks curiosity.

But there’s more to it.

A story.

In 2005, Paul Graham co-founded what has now become the Mecca for startup founders, YCombinator, popularly known as YC. The way YC works is a little different from how most seed funds operate. Twice every year they invest about half a million US dollars in a large number of early stage startups for 7 percent equity.

As per their website, this is what happens after a company makes it to YC.

“We work intensively with the companies for three months, to get them into the best possible shape and refine their pitch to investors. Each cycle culminates in Demo Day, when the startups present their companies to a carefully selected, invite-only audience.

The interesting part is the demo day. This is the day when you present your product and vision to a bunch of Venture Capitalists in a hope to raise a significant amount of money. Money that could help you survive, fuel growth, and attain the escape velocity.

But imagine the market is dry and VCs are too skeptical to hand out their money bags. That’s what happened after the 2008 financial crisis.

There was no money to be raised.

The 2008/2009 YC batches included companies such as AirBnB, Stripe, Mixpanel, Heroku, and Twitch to name a few. These companies are amongst the biggest names in the tech world today.

PG, later used the term ‘Cockroach Class’ to describe this cohort because they survived against all odds. Just as cockroaches can, these companies survived a nuclear winter. A nuclear winter in the investment world.

Hence, CockroachClass. 🙂

This name is a reminder to myself that survival is the key. You have to first learn to survive, and when the universe is done testing you, to see if you are strong and worthy enough, it helps you grow. Provided that is what you are actively seeking.