Monthly Archives: May 2025

Google vs. Y Combinator

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“Don’t be evil” Google (former) motto

“Make something people want” Y Combinator (current) motto

What a shock to discover the briefing of Y Combinator “against” Google in the U.S.’s monopoly case against the search giant. The link is here and the pdf there:

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I have been a fan of both entities for 20 years. But time flies and the world apparently changes. At the end of this post I will come back to the reasons why I have been impressed by Y Combinator over time and in particular the duo Jessica Livingston / Paul Graham.

In fact this article is more about Y Combinator. It could be that what I liked about Google is dead as it was hinted in Goomics. So no real need to talk about Google. I have done it so often with the tag #google. But I first need to describe shortly the accelerator’s arguments against Google.

BRIEF OF Y COMBINATOR, LLC AS AMICUS CURIAE IN SUPPORT OF PLAINTIFFS

The remedies stage of this case has important implications for technology startup founding and funding. We respectfully submit this brief to share our view, based on two decades of frontline experience, that robust antitrust enforcement here can help to foster a healthier, more resilient, and more vibrant U.S. innovation ecosystem. The startups we work with every day should be able to exercise their “vigor, imagination, devotion, and ingenuity,” United States v. Topco Assocs., Inc., 405 U.S. 596, 610 (1972), in markets that are free from restrictive conduct and illegally maintained monopoly power. YC supports Plaintiffs’ proposed remedy package as a whole. To aid the Court’s analysis, we also highlight below particular components of the proposed remedy as to which we believe our first-hand experience has given us unique insight and perspective.

Anticompetitive measure have been constant in the history of the USA and the brief reminds it :

Experience has taught us that technological inflection points are critical moments for competition and innovation. The rise of novel, transformative technology can create an opening for nimble startups to disrupt established incumbents. […] Dominant incumbents often respond by using exclusionary conduct to try to slow down or coopt the future. […] For example, during the mid-1990s, Microsoft recognized the disruptive potential of web-based software applications and reacted by anticompetitively blocking rival internet browsers from reaching users. United States v. Microsoft Corp., 253 F.3d 34, 60 (D.C. Cir. 2001). More recently, Facebook recognized the explosion in usage of mobile applications and reacted by acquiring mobile-native startups that it viewed as competitive threats. See FTC v. Meta Platforms, Inc., No. CV 20-3590 (JEB), 2024 WL 4772423, at *29–30 (D.D.C. Nov. 13, 2024) (“[T]he case for buying Instagram focused heavily on neutralizing a competitive threat.”).

Antitrust remedies have a long track record of unlocking American dynamism and ingenuity. An antitrust consent decree in 1956, for example, required AT&T to provide open access to its patents and technical manufacturing information. That remedy order helped usher in the modern digital age, in large part because it enabled “young and small” firms—what we think of today as “little tech” companies—to compete. See Martin Watzinger et al., How Antitrust Enforcement Can Spur Innovation: Bell Labs and the 1956 Consent Decree, 12 AM. ECON. J. ECON. POL’Y 328, 330 (2020). A new generation was able to enter and expand in a multitude of markets, helping to vault the United States into position as the world’s leader in technological innovation. Id. Economists have called the 1956 antitrust decree “one of the most unheralded contributions to economic development” in history, and the co-founder of Intel called it “one of the most important developments for the commercial semiconductor industry.” This tradition has continued in the modern era. In 2022, for example, the U.S. Federal Trade Commission blocked Nvidia Corp.’s proposed acquisition of Arm Ltd., a semiconductor technology firm. Arm’s CEO later explained that the structural separation “helped us” focus on delivering better products at a time when “more applications [were] moving towards the cloud” and “AI [was] starting to raise its head.” An Interview with Arm CEO Rene Haas. Arm has since gone public on the Nasdaq stock exchange, delivered record revenues, and is now worth more than $100 billion. Meanwhile, Nvidia’s earnings have nearly quintupled as its chips helped to fuel the rise of generative AI technology.

But by foreclosing competition, Google has chilled independent firms like YC from funding and accelerating innovative startups that could otherwise have challenged Google’s dominance. The result is a landscape that has been artificially stunted and stagnant. In our view, Plaintiffs’ proposed remedy package would help to unlock a more dynamic, globally competitive U.S. technology startup ecosystem.

Y combinator proposes the following remedies:
A. The Remedy Should Open Access to Google’s Datasets and Search Index.
B. The Remedy Should Prevent Google from Extending Its Monopolies into Query-Based AI Tools.
C. The Remedy Should Prevent Google From Entering Pay-to-Play Arrangements with Distributors.
D. The Remedy Order Should Deter Circumvention and Retaliation.

I’m not sure I understand all of this, but the implications would certainly be major. I will not go into more details, but for sure this is deep and quite fascinating.

ABOUT Y COMBINATOR

The brief mentions an article about Y Combinator, subtitled The Inside Story of Tech’s Most Influential Startup Accelerator. It is a great reading. I loved it and illustrates with a few comments.

First their philosophy is what mainly attracts me. And once again, this is linked to the people who founded it, in particular Paul Graham and Jessica Livingston. I will not count how many times Graham is quoted here, his essays are famous (I just counted 228 different articles since 2005) and in a way they are close to Montaigne’s. Just check one for example, The Two Kinds of Moderate.

As the article says, Jessica Livingston has an underrated role, “If Paul Graham was Y Combinator’s philosophical architect, Jessica Livingston was its social architect—quietly and effectively shaping YC’s culture and community from the earliest days.” If you have never heard of her, it is never to late to read Founders at Work. And indded Paul Graham felt the need to right an essay entitled Jessica Livingston 🙁

Their philosophy is simple and complex at the same time. Again read the article mentioned above and here are their “mantras, distilled from hard-earned experiences, are now part of global startup culture:

THE PERFORMANCE OF Y COMBINATOR

Don’t get me wrong. All this does not mean Y Combinator has found the recipe for success. Let met add just figures from the article:

You can have you own thoughts about these numbers. What I read is :
– out of 5000 startups, 17 went public (less than 1%) and about 500 were acquired (about 10%) and remember an acquisition can be at a very low value.
– not that many fail, particularly in the first years , so the “fail fast” mantra is not that obvious.
Is Y Combinator more sucessful than others. I do not know but I loved their approach to entrepreneurship.

ABOUT THE EVOLUTION AND DEATH OF INNOVATIVE ENTITIES

I just said “loved” and not “love”. I begin to feel that old structures lose their agility and creativity. It is what Y Combinator thinks of Google. I discovered that Graham and Livingston have retired from YC. I also believe that a culture is difficult to maintain when the founders leave. And I had a similar feeling with YC when Sam Altman & others began to lead it. There is somethind depressing about the comment but maybe not.

My first article on this blog was about the speech of Steve Jobs at Stanford. Read it again and again :

Death is very likely the single best invention of Life. It is Life’s change agent. It clears out the old to make way for the new. Right now the new is you, but someday not too long from now, you will gradually become the old and be cleared away. Sorry to be so dramatic, but it is quite true.

Your time is limited, so don’t waste it living someone else’s life. Don’t be trapped by dogma – which is living with the results of other people’s thinking. Don’t let the noise of others’ opinions drown out your own inner voice. And most important, have the courage to follow your heart and intuition. They somehow already know what you truly want to become. Everything else is secondary.

Silicon Valley : The Collapse?

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Excellent issue of FUTU&R, the magazine by Usbek & Rica, which main feature is entitled Silicon Valley, Chronicle of a Collapse. It’s not a good time to be a fan of the region these days. If you follow my blog, you’ve seen my struggles to understand what’s going on there. This issue contributes to this, and you’ll discover dubious characters like Curtis Yarvin, Balaji Srinivasan, Palmer Lucky, in addition to the famous Peter Thiel, Marc Andreessen, David Sacks, and even Larry Ellison. The issue is a bit biased, but that’s the name of the game, since the magazine “imagines how the Tech Eldorado could collapse.”

The magazine had the good idea to add the informed opinion of Olivier Alexandre, often mentioned on this blog, notably as the author of La Tech. I scanned the contributions in low resolution and I hope the magazine will forgive me for this breach of copyright. I obviously encourage you to buy a copy!

I will just comment on what Olivier Alexandre says and I will end this post by discussing a related subject through a fairly recent scientific article, The Role of Universities in Shaping the Evolution of Silicon Valley’s Ecosystem of Innovation (pdf)

“Are we witnessing the collapse of Silicon Valley? What is certain is that it is at a crossroads. Historically, tech has thought of itself as a solutions industry, except that its solutions are now our problems. […] It is clear that we no longer hear dissenting voices. There have always been debates in the Valley, but the tech supremacist fringe, to which Trump supporters like Peter Thiel and David Sacks belong, was a minority, drowned in the mass. […] Steve Jobs and software entrepreneurs have been made stars and the history of Silicon Valley has been reduced to the success of a hippie counterculture, when it is above all a story of transistors, microprocessors, and engineers with perfectly standardized lives.”

Indeed, the region was a republic of engineers, with back-and-forths between fierce competition in a global world and deregulation and occasional isolationism allowing monopolies. In the 1980s, the threat was Japan, and the semiconductor industry had appealed to the Federal State for its survival (after having benefited from the flow of public money at the height of the Cold War in the 1960s.) I recently spoke of my difficulty in finding dissenting voices too.

“In 2022, the situation changed and Big Tech started laying off employees. Since then, they’ve been cutting 5% of their payroll every year.”

On this point, I slightly disagree with the observation. In 2009 and 2013, for example, Google also reduced its workforce by 5%. I had heard that Cisco was shedding 5% of its “lowest-performing” workforce each year. The region was so dynamic that it was rarely discussed. Working conditions have always been “harsh and demanding.” A world of engineers, no doubt. It brought us computers and smartphones, the internet, and therefore opportunities to behave differently. It also contributed to creating immense biases because, without a doubt, the use of science and technology is never completely neutral.

“The question being asked of the world is the link between new technologies, innovation, and progress, which are three very different notions. Historically, innovations that have had a lasting impact are few: watches, eyeglasses, jeans… However, today, Silicon Valley mostly creates very ephemeral innovations.”

Tom Kleiner went further, mentioning the printing press, the steam engine, electricity, and finally the transistor as innovations that changed civilization. This is undoubtedly close to reality.

And Olivier Alexandre adds a beautiful question: “The products offered are essentially based on the promise of saving us time. But what do we lose when we save time?”

And he concludes (provisionally): “Dubai is one of the rare places that has managed to make the future sexy, an optimistic vision of the future: rain without clouds, islands without land, snow without mountains. But above all, technological progress without democracy. All this in a vulnerable area where the questions of resources, food, and housing have always arisen. In a way, Europe embodies the opposite: democracy, sometimes at the cost of technological progress.”

This isn’t the first time that the future of Silicon Valley has looked bleak. For example, you can find AnnaLee Saxenian’s predictions in a post titled Is Silicon Valley crazy (again)?: “In 1979, I was a graduate student at Berkeley and I was one of the first scholars to study Silicon Valley. I culminated my master’s program by writing a thesis in which I confidently predicted that Silicon Valley would stop growing. I argued that housing and labor were too expensive and the roads were too congested, and while corporate headquarters and research might remain, I was convinced that the region had reached its physical limits and that innovation and job growth would occur elsewhere during the 1980s. As it turns out I was wrong.”

There’s no doubt the region is at a new crossroads! But I’m not finished yet, see below.

I promised above to talk about a scientific article dating from 2020. I found its conclusion interesting even if overall the content well-known. So I copy paste :

Silicon Valley—a Metaphor in search of a Structure?

Silicon Valley is a metaphor for a region that lacks a viable governmental structure. It is at the stage of New York, before its 1989 consolidation into a unified city. With the notable exception of the ecology of the Bay, a downside has emerged, a public-private imbalance revealing gaps in housing and transportation Spread across multitudinous counties, towns and cities, Silicon Valley lacks sufficient governance capabilities to address the negative consequences of its overweening success.
An additional imbalance in academic capacities is, in part, a consequence of a more than half century old master plan strictly segmenting the public academic sphere that has limited individual institutional advancement. This gap has been partly redressed by establishment of branch campuses by universities in other parts of the country, like Carnegie Mellon and the Wharton School that ironically treat the region as an under-developed area, at least in its academic capabilities. Moreover, state government funding for public universities
has declined drastically, from providing 40% of Berkeley’s budget in the 1980’s to 14% percent at present. This gap is being redressed by a massive fund-raising campaign that expects to raise 6 billion dollars and increase the universities tenure track positions in coming years.
Re-balancing the Triple Helix will also require increased interaction among the spheres, a phenomenon that has declined in recent decades, placing the long-term innovation and carrying-capacity of the region at risk. The innovative and sustainable economic development of Silicon Valley not only depends on the presence of strong universities, but on how they interact and overlap roles with the other agents of the Triple Helix model, looking for mutually strategic objectives and identifying cross-cutting issues which none of them can adequately deal individually. Interactions between university, industry and government in a highly dynamic and volatile environment, represent a unique opportunity to recover from economic downturn, create new jobs, and promote a prolific, inclusive and economically sustainable development of regions in the long run.

Invisible Genius(es), Lost Einstein(s), Marie Curie(s) living in Morbihan

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Xavier Jaravel comes back in a column entitled “Let’s Not Forget the Lost Marie Curie(s)” for the newspaper Les Echos to one of his favorite topics: “Access to innovation depends heavily on social background, parental income, gender, and department of birth. With equal abilities, children from modest backgrounds have a much lower chance of becoming researchers, entrepreneurs, or inventors than those from privileged families.”

I say “one of his favorite topics” because I loved the short and magnificent essay he published in 2023: Marie Curie Lives in Morbihan – Democratizing Innovation.

For the (very) curious, you can delve deeper into the subject by reading two scientific articles:
– Social Push and the Direction of Innovation by the same author and by Elias Einiö and Josh Feng, March 2025.
– Invisible Geniuses: Could the Knowledge Frontier Advance Faster? by Ruchir Agarwal and Patrick Gaule, IMF Working Paper 18268, December 2018.

I was fortunate to be invited by the same IMF in January 2019 to analyze the sources of innovation. There, I discovered the similar concept of the Lost Einstein. A paper also co-authored by Xavier Jaravel and entitled Who Becomes an Inventor in America? The Importance of Exposure to Innovation provides a definition: There are many “lost Einsteins” – individuals who would have had highly impactful inventions had they been exposed to innovation in childhood – especially among women, minorities, and children from low-income families.

When I read analyses of the reasons for innovation failures, particularly in Europe, I see “rational and economic” explanations, such as overly strict regulations, uneven markets, inappropriate taxation, and inadequate investments. I hear fewer cultural or sociological reasons, which seem far more convincing to me. Xavier Jaravel helps highlight important and little-known elements. Thanks to him!