I say "white, wealthy and went to Stanford" because that is the reality of it. The "Hi, I'm going to raise money on nothing but an idea because trust me" strategy does not generally work if you are Indian, Chinese, or any other minority ethnicity, unless you previously had an exit (in which case you know just how hard actually building a business is, and my comment doesn't apply to you). It largely also does not work even if you are white, if you happen to lack the cultural capital that comes with growing up wealthy and going to Stanford. I know a number of East and South Asian founders (I'm one of them) who have taken VC (I'm not one of them), and they all got to that point the old-fashioned way: they built a product and sold it, themselves, before any VCs invested. These are all folks who have plenty of credentials, including working at major successful Silicon Valley companies (Sun, Google, Microsoft) or graduating from Stanford.

(Exception: if you are Chinese and your investor is Chinese and you have a personal connection to that investor you can sometimes raise money on "Hi I have an idea and trust me." This is a recent development and comes from the massive amount of Chinese capital floating around these days, and is sometimes not actually the best move for your startup.)

Do you think (a) White applicants are more likely to get into YC? (b) Founding teams with no white people that get to demo day are less likely to get funded than those who do?

I know YC is a relatively small part of the VC ecosystem but it’s pretty influential. If the VC ecosystem is as racist as you say there should be plenty of opportunity to make better returns out there for some enterprising VC.

I think YC is pretty unrepresentative of the VC industry in this regard, simply because the VC industry is as racist as I say and YC is hoping to be that enterprising VC that seizes this opportunity for better returns. The YC partners have been pretty open about this - racism creates a market opportunity, and so they've put in a significant amount of working in retraining their own unconscious biases so that they don't miss the market openings that are left behind by other firms. (I should probably also say that they're not doing this just for better returns - it's also the right thing to do, but it has the side-effect of being economically rational.)

There are a few other VC firms that similarly work hard to avoid missing promising founders of minority backgrounds, but they are still the exception rather than the rule. Over time, the "rich, dumb, and prejudiced" folks will get flushed out of the market, but that's over a lot of time. Besides, they'll probably just get replaced by a different set of prejudices - nobody can be 100% unbiased, you can only hope to replace biases that are useless and arbitrary with ones that are somewhat more useful.