500 Startups Partners Marvin Liao and Elizabeth Yin are warm, friendly individuals, but they also break a lot of hearts.

As gatekeepers for 500’s San Francisco-based accelerator, Liao and Yin lead teams that review anywhere from 1,500 to 3,000 applications per 12-week round.

There’s nothing fun about raining on someone’s parade, but with only 35 to 45 slots available, there’s a lot of disappointment to go around. “We have to look through every single one, then we filter it down,” said Liao.

Which Applicants Are Most Likely To Hear “Yes” From 500?

“We really do take it case by case,” said Yin, though there are a few hard and fast rules. “In most cases, we look for a complete full-time team that has a product already launched, ideally with paying customers.”

“We’re a customer acquisition-focused program,” said Liao, so he’s always seeking opportunities “in some huge market that we’re all personally interested in, and where there’s availability of downstream capital.” Many applicants embody a several of these traits, “but it kind of needs to hit all of these points before we bring you in,” Liao said.

No Market, Revenue, Customers Or Live Product? Come Back Later.

Even in Silicon Valley, there’s such a thing as being in too much of a rush, Liao and Yin agreed.

“If you have an idea and haven’t done anything with it, that would probably fall under the category of too early,” she said.

In other cases, “it may be that the market’s there and founders are really awesome but they’re still very early, so they better suited for a batch downstream,” Liao added. “They don’t know who their customers are, or, after I walk out of the interview, I’ll have no idea of what they’re working on.”

Cap Tables Matter

In many cases, international startup founders are more likely “to have a cap table that’s screwed up,” said Liao. “We love you, we love the company, but the fact that you as founders own 30% of the company is going to make it hard for you to raise downstream capital, so we can’t invest, period,” he lamented. “That’s a lot more common than you’d think for international companies.”

“This is not a one-time thing. You’re not applying to college. This is a continuous process.” — Elizabeth Yin

Yin said 500’s interests are “fairly broad” and extend beyond software into verticals like fintech and ecommerce,”where you can get a lot of online customer acquisition.”

Entrepreneurs seeking to join a 500 batch should make sure they’re good with the size of the checks they’ll receive; pharma founders need not apply, as the sector is “too rich for 500,” said Yin.

Entrepreneurs who don’t follow the guidelines or submit incomplete applications aren’t even considered, and liars need not apply.

“We had someone say in their application that they’re doing $5 million in revenue,” recalled Liao, “and then we interviewed them and found out that they hadn’t even launched yet. That interview ended pretty quickly, he said. “We haven’t had to kick anyone out yet, knock on wood. you try to catch that stuff during the interview process.”

“We should not be picking people based on personality because great entrepreneurs come in all shapes and sizes.” — Elizabeth Yin

Results Are More Important Than A Startup Founder’s Personality

If Yin and Liao question an entrepreneur’s values or business acumen, they’re unlikely to move forward, Yin said, citing an example of a team with a high burn rate. “If they hadn’t raised that much money and it seems like the money they had wasn’t going towards anything useful, we thought these people were too spendthrift and the money’s not going to go towards growth.”

That was a subjective judgment, Yin acknowledged, but it was came from key metrics, not a personal vibe. “That part is where subjective, unconscious biases can start to creep in, and I am very leery of that,” she said.

“When everybody says, ‘I really love this founder because he or she is a hustler,’ I push people to dive into what specifically does that mean,” Yin said. “Do you like a person’s personality because they’re outgoing and charming and friendly? Or, is it that they have actually exhibited concrete results?”

“We should not be picking people based on personality because great entrepreneurs come in all shapes and sizes,” said Yin.

Liao concurred. “Do we think that they’re smart? do we think that they’re coachable? Do we think that we can be helpful?” He’s not looking for polished presenters. “They learn that due to people on my team like Andrea Barrica, who are very good pitch coaches and storytellers with an ability to say to founders, ‘here’s what really matters.'”

When Yin encounters serious introverts who have great products and no sales skills, she advises them “to really make the concerted effort to sell more, or bring somebody else on board.”

Even among the founders who are accepted, “about half just don’t do well in the interview,” admitted Liao.

“We value persistence.” — Marvin Liao

500 Startups’ Transparent Rejection Process Encourages Founders To Reapply

As a former entrepreneur, Yin said she always grew annoyed when investors would pass on her pitch without offering any feedback or rationale. “If you try to push them further, they’ll say, ‘it’s not a good fit or something vague like that,'” she said.

Instead, Yin said she strives to be as open as possible with founders who weren’t accepted into the batch of their choice. “Any company who asks us specifically why we’re passing, we’ll be very up front about that,” she said. “This is something that I strongly believe in.”

“A rejection from us is not a rejection forever.” — Elizabeth Yin

“A rejection from us is not a rejection forever. We recognize that entrepreneurs are constantly learning and people will make lots of mistakes,” said Yin, who said a handful of the companies in each batch were initially rejected. “Even if we don’t agree and see eye to eye, it doesn’t mean that we’ll never aligned later on.”

“This is not a one-time thing,” she said. “You’re not applying to college. This is a continuous process.”

Liao said founders who aren’t accepted should ask 500 for feedback and advised them to stay in touch. “As you’re getting traction and making progress, keep us updated,” he said. “We value persistence. And, don’t take it personally. We’re fairly selective.”