Automatic Pro-rata was a relatively recent addition to YC.
(i.e. when we went through in 2009 it did not exist)
It also clearly isn't scaleable without infinite capital.
Plus, if you had complete information, why would you ever want to automatically invest any time a company in your portfolio raised money?
My guess is the only reason they made it automatic, was to minimize the impact of a negative signal. It sounds like they hope the new changes will still minimize that signal.
If LP's are willing to fund automatic pro-rata it's pretty clearly in YC's interests to take them up on it. Apparently that used to be the case but now it's not.
> If LP's are willing to fund automatic pro-rata it's pretty clearly in YC's interests to take them up on it.
This assumes that automatic pro-rata is a winning investment strategy. YC's goal ultimately is to turn money into more money, or at least that's (almost certainly) the most significant metric of success for them.
If anything, the new changes will be a huge signal (YC doesn't think this company is one of its most valuable investment opportunities), except in this case, outside investors without insider information will be the ones left holding the hot potato.
(i.e. when we went through in 2009 it did not exist) It also clearly isn't scaleable without infinite capital.
Plus, if you had complete information, why would you ever want to automatically invest any time a company in your portfolio raised money?
My guess is the only reason they made it automatic, was to minimize the impact of a negative signal. It sounds like they hope the new changes will still minimize that signal.