Y Combinator's first project is to fund a crop of new startups this summer.

The Summer Founders Program preserves many features of a conventional summer job. You have to move here (Cambridge) for the summer, as with a regular summer job. We give you enough money to live on for a summer, as with a regular summer job. You get to work on real problems, as you would in a good summer job. But instead of working for an existing company, you'll be working for your own; instead showing up at some office building at 9 AM, you can work when and where you like; and instead of salary, the money you get will be seed funding.

What happens at the end of the summer? That's up to you. If you want, you can mothball or dissolve your startup, and no harm done. If you want to keep going and we think your company is promising, we'll probably be able to help you get more funding.

Succeeding as a Summer Founder does not imply dropping out of school. If this summer's experiment works, we may fund promising groups through several successive summers. Perhaps one day, instead of working at a series of unrelated summer jobs, ambitious undergrads will spend their summers building themselves a company, which they can then plunge into year-round when they graduate.

But even if your project fails and you give up at the end of the summer, you'll be better off than if you'd taken most summer jobs. It will be difficult to get into this program, so being able to say on your resume that you were a Summer Founder should carry more weight than an ordinary summer job. You'll learn way more than you would in most summer jobs, and you'll probably meet more interesting people.

If you're accepted, we'll deal with the paperwork for you. We'll incorporate you, if need be, get you a corporate bank account, supply simple, generic employment agreements for you to use, and so on. We can give some advice about patents, though you don't have to deal with that in the earliest stages; you have a year after making a discovery to file a US patent application for it.

We'll have some smart people who are willing to talk over your plans with you, and suggest pitfalls and new ideas. We may also have connections to companies you'd like to do deals with. But how much you want to take advantage of our advice and connections is up to you.

We'll organize some kind of dinner once a week for all the Summer Founders, so you can meet one another and compare notes. We'll try to get some expert in technology, business, or law to speak at each dinner. But beyond that we'll be hands-off. We don't plan to interfere in your company the way ordinary VC firms or "incubators" do. We won't insist on being on your board of directors, or that you get a business guy to be your CEO, or that you work in our building. We expect you to work out of whatever apartment you can find to live in. It is probably no coincidence that so many successful startups have started in apartments; it is the ideal setup for the initial phase.

(We have some space you can use in emergencies. But only dire and temporary ones, like the death of your Internet connection, or the people in the apartment downstairs having a three-day party.)

Though this program is designed to be convenient for people still in school, any group can apply. Indeed, the ideal startup from our point of view would be mix of some people still in grad school and some who've finished. But while the mid-20s is probably the ideal age, we'd consider betting on a team of college freshmen if they seemed smart enough.

The people are what matter most to us. We plan to use the animal test described in How to Start a Startup, plus, for technical people, the first two of the three tests we used for hackers. (We don't care about the third, so long as you can stand one another.)

We consider the technologies you plan to use an indication of your ability. If you plan to develop software in Blub, and we see no reason the application demands it, we'll wonder if it's because you can only think in Blub.

Likewise for OSes. If your project has to be a desktop app (question: does it?), you probably need a Windows version. At least till Google crawls down the pipe onto the desktop, and makes the OS underneath irrelevant. If you're developing "enterprise" software, you might even want to write server-based apps on NT. But if you propose to write a server-based app for the general public (e.g. a dating site) on NT, you should be prepared to explain what you know about servers that Yahoo and Google don't.

We expect you to have some definite plan for the company you want to create, but we also expect you to modify this plan as you go. It would be a bad sign if you didn't. If at the end of the summer some group is still doing precisely what they said they would, it's probably because they're out of touch with the market, not because they scored a perfect bullseye with the idea.

We don't expect you to have a formal business plan yet. All you have to do is fill out an application. If you're accepted, we'll write the initial check to you personally, so you have enough money to get here and rent an apartment. (We always wished companies hiring us for summer jobs realized how inconvenient it was to wait for that first paycheck.) If you aren't already incorporated-- which we greatly prefer, because it's simpler if everyone's paperwork is the same-- we'll incorporate you when you get here. The remaining checks will go to your company. Since you'll be the officers, you can spend the money however you like.

We want to fund as many startups as possible, so we're not going to give each one much more than you'll need for living expenses. We estimate living in or near Cambridge for the summer to cost about $6000 per person, including travel. If you need expensive hardware, we'll consider it, but the odds of being accepted are lower. It's in your interest to take little money in the earliest stages, because you give up less of the company for it.

The ideal company would have two or three founders. We'll consider those with four or five. We're unlikely to accept one-person companies, because (a) it's too much work for one person, and (b) if you can't talk any of your friends into starting a company with you, your idea is probably not viable.

You don't have to have all the founders here for the summer, but you should be missing at most one. You can of course leave town whenever you need to. It's your company.

We'll consider startups in any field, not just software. But Web/software startups are more likely to be accepted, because that's what we know about, and where a lot of the opportunities are now.

We are looking for winners. The original motivation of this project was benevolent, but this is not a charity. If our investments pay off, we can invest in more startups, and if they don't, we can't keep doing this indefinitely. We're looking for startups we believe will succeed according to the classic metric of making money.

So take care to avoid a common trap founders fall into: starting a company you think will be amusing. Getting rich is hard but doable. Getting a fun job is hard but doable. Trying to solve both problems simultaneously approaches impossible.

Startups can be fun at times, but you're doomed if you design one with that in mind. The function of a company (as opposed to a nonprofit) is to make money. If you stray too far from that, it's easy to cross over into losing money, at which point any company has to stop. So we will have a stricter filter for groups with the default ambition of CS undergrads (multiplayer games) than for those who plan to build some unromantic but very definite piece of technological plumbing. Propose games if you want, but you'd better be ready to explain what makes you unique.

This is not a contest. This is actual venture funding. So (unlike the MIT Entrepreneurship Competition, for example) we won't publicize the companies that get funded, unless for some reason you want us to. Startups should keep a low profile during the seed stage. Before you have a product you want customers for, publicizing your plans helps competitors more than you.

We don't care if you're US citizens, but you have to be in the country already. We can't get visas for you. We know India and China are full of smart people who'd like to come and contribute to the growth of the US economy, but our government won't let us bring you here to do it.

We know you have to decide about summer jobs soon, so we're trying to do this fast. Here's the procedure:

1. Choose the people you want to start a startup with. You apply as a group. It could be April 10 before you get an answer, so don't include anyone who can't change their summer plans that late.
   
   
2. Fill out the application form, and send it as an ascii text email (no attachments please) to sfpapply@ycombinator.com. The deadline for applications is 11:59 PM EST on March 26. There is no need to resubmit because you sent your application to our previous email address; it all goes to the same place.
   
   Your from email address = your identity at this stage. If you want to change something, don't send us corrections; resubmit your whole application. You can resubmit up to 2 times (total 3) before the deadline, but only from the same address. Your application will be credited with the time of the first application. One person can appear in multiple applications, but in that case at most one of them will be accepted.
   
   
3. A few days after March 26 we'll reply with one of three responses: yes, no, or come to meet us.
   
   Yes answers will include the valuation at which we're willing to invest. It will ordinarily be in the low to mid hundreds of thousands, but may occasionally be higher. Unless you've told us about specific hardware you need, the total investment will be about $6000n, where n is the number of people you'll be sending to Cambridge for the summer.
   
   No answers won't be accompanied by a reason why we didn't invest. Don't take it personally. All selection processes are fraught with error; we wish more would admit it.
   
   Come to meet us means we want you to come to Cambridge on the weekend of April 9/10. We'd like you to bring as many people as you can, but we'll only reimburse you for up to $300 for travel, so you don't need to bring everyone if you can't afford it. A few days later we'll reply yes or no (see above).
   
   
4. If you accept our offer, we'll give you an initial check to help your group get here and/or rent an apartment. We recommend you get an apartment together, but it's up to you. Greater Cambridge is the easiest place in the world to get summer sublets.
   
   
5. If all the people in your group aren't here by June 6, we reserve the right to pull out of the deal. We'll make exceptions for people who have to attend graduation ceremonies, and for students at places like Stanford where finals continue into June.
   
   
6. If you aren't incorporated, we'll help you do it when you get here. After that checks go to your company.
   
   
7. We'll meet for dinner about once a week during the summer. We'll try to bring someone experienced in startups or technology to each dinner, so you can pick their brains. We don't insist you come to the dinners, but if we don't know you well, we'll be less likely to help you get more funding at the end of the summer.
   
   
8. During the summer we'll help you write a business plan, try to introduce you to people who could help you, and so on. We can't make definite promises because we don't know how busy we'll be, but once we've invested in your company, we obviously want you to succeed.
   
   
9. If you look promising during the summer, we may invest more, or help you find someone who will. Of course you can at any time get any further investors you want; it's your company.
   
   
10. We're setting this up fast, so the application process may change. Hit reload before you submit your application.
    
    
11. Send all questions about the Summer Founders Program to sfp@ycombinator.com.

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