Investor Profile

Y Combinator Investor Profile

    Y Combinator is an Accelerator based in Mountain View, CA, USA. Y Combinator created a new model for funding early stage startups. Twice a year they invest in a large number of startups.

    More information about Y Combinator can be found on its web site.
      Y Combinator (YC) is an American seed money startup accelerator launched in March 2005. It has been used to launch over 2,000 companies, including Stripe, Airbnb, Cruise Automation, DoorDash, Coinbase, Instacart, Dropbox, Twitch, and Reddit. The combined valuation of the top YC companies was over US$155 billion as of October 2019. The company's accelerator program is held in Mountain View, California.
      • Y Combinator was founded in 2005 by Paul Graham, Jessica Livingston, Trevor Blackwell, and Robert Tappan Morris.
      • From 2005 to 2008, one program was held in Cambridge, Massachusetts, and one was held in Mountain View, California. As Y Combinator grew to 40 investments per year, running two programs became too much.
      • In January 2009, Y Combinator announced that the Cambridge program would be closed and all future programs would take place in Silicon Valley. In 2009, Sequoia Capital led the $2 million investment round into an entity of Y Combinator to enable them to invest in approximately 60 companies a year. The following year, Sequoia led an $8.25 million funding round for Y Combinator to further increase the number of startups the company could fund.
      • In 2011, Yuri Milner and SV Angel offered every Y Combinator company a $150,000 convertible note investment. The amount put into each company was changed to $80,000 when Start Fund was renewed.
      • In September 2013, Paul Graham announced Y Combinator would fund nonprofit organizations that were accepted into the program after having tested the concept with Watsi (while continuing to fund mostly for-profit startups).
      • In 2014, founder Paul Graham announced he was stepping down and that Sam Altman would take over as president of Y Combinator. That same year, Altman announced "The New Deal" for YC startups, which offers $150,000 for 7% equity. Late in 2014, Sam Altman announced a partnership with Transcriptic to provide increased support for Y Combinator's growing community of biotech companies.
      • In 2015, Altman announced a partnership with Bolt and increased support for hardware companies. The YC Fellowship Program was announced in July 2015, with the goal of funding companies at the idea or prototype stage. The first batch of YC Fellowship included 32 companies that received an equity-free grant instead of an investment.
      • In January 2016, Y Combinator announced version 2 of the Fellowship program, with participating companies receiving $20k investment for a 1.5% equity stake. The equity stake is structured as a convertible security that only converts into shares if a company has an initial public offering (IPO), or a funding event or acquisition that values the company at $100m or more. The YC Fellowship was short-lived. In September 2016, then CEO Sam Altman announced that the fellowship will be discontinued. On 11 August 2016, YC announced that YC partners would visit 11 countries to meet with founders and learn more about how they could be helpful to international startup communities. Those 11 countries were Nigeria, Denmark, Portugal, Sweden, Germany, Russia, Argentina, Chile, Mexico, Israel, and India. In September 2016, Y Combinator announced that then CEO Altman would be leaving Y Combinator and moving the role of president of YC Group, which includes Y Combinator.
      • Former Twitter chief financial officer and chief operating officer Ali Rowghani was then in charge of the YC Continuity Fund when it started and continues to act as CEO of YC Continuity. Michael Seibel, who co-founded Justin.tv, is the new CEO of YC Core, the program that Paul Buchheit has run since 2016.
      • In 2017, Y Combinator announced Startup School, an online course that released public videos and also coached individual startups on a larger scale to replace the fellowship. 1584 startups graduated the program in its first year.
      • In 2018, Y Combinator announced a new batch of startup school. After a software glitch, all 15,000 startups that applied to the program were accepted, only to learn a few hours later that they had been rejected. But the ensuing outcry led Y Combinator to change course again and decided over an official blog to finally accept all those 15000 companies. Now, every company is accepted to join YC Startup School without any restrictions.
      • On May 20, 2019, Sam Altman announced he was stepping down and that Geoff Ralston would take over as President of Y Combinator.
      • On April 20, 2020, Michael Seibel announced that the summer 2020 ("S20") will be fully remote, due to the COVID-19 pandemic. This includes interviews for the batch, office hours, evening talks, and meetups throughout the batch.
        Y Combinator interviews and selects two or more batches of companies per year. The companies receive seed money, advice, and connections in exchange for 7% equity of the company. The program includes "office hours", where startup founders meet individually and group meetings. Founders also participate in weekly dinners where guests from the Silicon Valley ecosystem (successful entrepreneurs, venture capitalists, etc.) speak to the founders. Y Combinator's motto is "Make Something People Want." The program teaches founders to market their product, team and market, refining their business model, achieving product/market fit, and scaling the startup into a high growth business, etc. The program ends with Demo Day, where startups present their business and sometimes technology to potential investors.

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