I started my first business (web design) at 15 with a £1,000 grant from The Prince's Scottish Youth Business Trust. It was a very significant amount for me. Without it I wouldn't have been able to start.
My family were on income support so the money went straight on a PC, internet, phone line, business cards and public transport to reach my clients to pitch them. Thankfully I still lived with my parents: no rent until I was earning.
$12k is a very substantial amount for an underprivileged kid who's making the Airbnb vs. large corp choice.
My grant was (lightly) means-tested. Did you consider means-testing as a way to make more of an impact past the ideological one?
I find this an interesting point to bring up. My family were also on income support when I was younger, and I also applied for the Youth Opportunity Funding grant in the UK and was awarded £1,250.
Similar to drsim I intended to start my own media business using the money, so I purchased a cheap PC, a camera, business cards, etc
In order to apply for the money I had to go through what was quite a lengthy process, which overall took three months to complete. I had to choose every item in advance with photocopies of the catalogue; this was to prevent people cheating the funding and spending it on other things. This also made it difficult to include consumables such as an internet subscription and transportation costs.
Does YC plan to background check and make sure the $12,000 would actually be spent on what it's intended for?
Also, does YC still consider applicants based in Asia, or is it US-based for the time being?
The effort involved in means testing, including verification, would be extremely taxing for an organization the size of YC and doubly so in relation to the size of the money involved. I have to suspect they never seriously considered it because it'd be so impractical, and there would be inevitable abuse (each layer of complexity makes such things worse, for YC simplicity has always been integral).
For my grant I was asked to sign a simple declaration of means. There was no verification. It was more to do with the aspiration of the Trust rather than an ironclad requirement (I was funded age 15: the minimum was supposed to be 16).
There would be no additional burden on YC to say 'we want to encourage more people from underprivileged backgrounds to start a company'.
At this level of funding YC's impact is going to be much greater for that demographic than those whose parents can afford to seed their startup just as they'd buy them their first car.
Means testing adds a lot of bureaucratic overhead, especially if it's international, and it could dissuade some marginal people from engaging if they have to produce a bunch of documentation.
One option I've seen, though it's not bullet-proof, is to just have an explanation of who the money is intended for, and require applicants to sign a statement about their financial condition. Someone could always lie about it, but most people won't (especially since lying on an application for money is illegal).
In most cases, lying on such an application in the private sector will fall under fraudulent misrepresentation. You might get sued in civil court for it, but it's unlikely you'll be pursued for false pretenses. Especially over $12,000.
People lie to each other on business contracts every minute of every day, nearly all of it ends up as a civil offense.
My family were on income support so the money went straight on a PC, internet, phone line, business cards and public transport to reach my clients to pitch them. Thankfully I still lived with my parents: no rent until I was earning.
$12k is a very substantial amount for an underprivileged kid who's making the Airbnb vs. large corp choice.
My grant was (lightly) means-tested. Did you consider means-testing as a way to make more of an impact past the ideological one?