Data Driven: How Many Startups Actually Listen to Paul Graham’s Advice?

Paul Graham is, in short, one of the great innovators of the Internet era. Seven years after selling his company Viaweb to Yahoo! in 1998 for 455,000 shares of Yahoo! stock, Paul co-created Y Combinator to provide seed funding to startups with a bias towards tech and online ventures. Y Combinator has become the world’s foremost startup accelerator and has previously invested in companies such as Dropbox, Coinbase, and Stripe.

Along the way, Paul has received many accolades, including being listed in Business Week’s 2008 edition of “The 25 most influential people on the Internet”.

But one piece of advice from Paul has always stood out to me, and that’s his philosophy on domain names. In a 2015 blog post entitled “Change Your Name“, Paul wrote:

If you have a US startup called X and you don’t have x.com, you should probably change your name.

Essentially, Paul is saying that if you don’t own the exact-match .COM for your company name, you should change the company’s name. It’s a piece of advice that has been quoted by numerous domainers ever since 2015, but how many startups have actually heeded Paul’s advice?

To find out, I’ve dug through data for every single company that Y Combinator, or Paul Graham personally, has ever invested in. I’ve stuck to these simply because these companies will be the most familiar with Paul, and will know his thoughts and philosophies in the most detail.

 

The Data

My list consists of 2,188 startups that Paul Graham or Y Combinator have invested in. This is according to Crunchbase and is an accurate figure as of the end of May 2020. Instantly, we can discount 482 of these companies as they’re listed as using a domain that is not a .COM

If you’re interested, .AI, .IO, and .CO account for 57.05% of these 482 names. The remaining 1,706 companies are all listed as using .COM, which equates to 77.97% .COM usage. That’s the number we’ll be working with.

What we’re trying to find here is the number of companies that are using a .COM that exactly matches their company name – so no filler words such as “Get” or “Try” (such as getdomain.com, or trydomain.com).

 

The Results

As it turns out, most companies using .COM are taking Paul’s advice seriously. Of those who are using a .COM, 79.48% of them own their exact match .COM domain for their company name. That, therefore means that 20.52% do not own their exact match .COM.

In some cases, it’s very easy for a company to acquire an exact match .COM. They simply have to register it. For companies such as Spinal Singularity, which has twice received funding from Y Combinator, it’s easy to acquire their exact match .COM.

That means that overall, out of all 2,188 companies that either Y Combinator or Paul Graham have invested in, 61.97% of them own their exact match .COM domain.

[click_to_tweet tweet=”61.97% of companies backed by @ycombinator and @paulg own their exact match .COM domain” quote=”61.97% of companies backed by Y Combinator and Paul Graham own their exact match .COM domain”]

 

The Companies That Have

There are plenty of companies that have had to spend significant money to buy their exact match domain. A prominent example of this is Cover, an insurance app that has received $27 million of funding to date, with Y Combinator contributing to Seed, Series A, and Series B rounds. Cover was previously using CoverInsurance.com before they paid a sizable $825,000 to get Cover.com.

More recently, Gem rebranded from ZenSourcer to Gem and acquired Gem.com along the way. According to someone familiar with this sale, the domain was acquired on a payment plan in a deal that was worth somewhere in the seven-figure range.

In fact, there are tens of examples among the data where companies have spent significant funds to acquire their exact match domain after launching.

 

The Companies That Have Not

Among the companies that haven’t acquired their exact match .COM domain, the average company name length is slightly shorter – eight characters versus nine characters. It may not seem like a big difference, but shorter .COM domains are generally higher in demand, so getting an exact match .COM domain for a company with a shorter name is going to be more competitive, more expensive, and more difficult.

These include many companies operating on short, dictionary words including:

  • Grin (ongrin.com)
  • Mason (bymason.com)
  • Draft (draftin.com)
  • Riot (tryriot.com)
  • Joy (withjoy.com)
  • Proof (useproof.com)

Notice any common pattern there? These are all companies that use a short dictionary word as a company name, but they use domain names with those pesky filler words. Try, On, With, Use.

In some cases, such as with scooter company Grin, their exact match company domain is currently unavailable as it hosts a popular publishing site. By Paul Graham’s own advice, Grin should rebrand.

 

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