It's a lot easier to get third-party investment once you've successfully sold a startup, and it's much less risky than pouring your own cash into your next venture. I'd say it's far from a foregone conclusion that you'd put a large amount of your own money in.

I'd have to add that YC isn't exactly your average startup though, and the founders putting their own money in sends a much stronger message of dedication to potential participants.

I think the real factor is control. Does Paul Graham really seem like the guy who would want a boss if he could avoid it?

Well, he _did_ just get married.

Good point; also, investors want some kind of chance or indication that the company will exit. I can't imagine that's planned for YC.

In any case, I'll take your word for it as you definitely know Paul better than I do. ;)

It would be easy to raise money if we wanted to, but we don't need it. The investment required is not so great that it's dangerously large for any of us.