Exactly, if they'd had 15 customers paying $50/month and were adding 5 more each week, that'd be a very different story.

Even if the product at that point was just Matlab-in-the-cloud, those customers could tell them what features they're looking for to help the team make the product unique.

The site having no traction is not the reason they did not get accepted. In the YC application they "explicitly" ask if you have customers. Just a guess here but Im thinking PG and company read their app before they invited them for an interview .