Regarded as the most well-known and successful startup accelerator, Y Combinator is an organization focused on helping early-stage companies achieve rapid growth through a combination of funding and structured mentorship.
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In one of Paul Graham’s essays on his website, he took the time to explain how and why he and his cofounders (including his girlfriend at the time, and now wife, Jessica Livingston), came up with the idea of and eventually created Y Combinator.
Many of the philosophies that the leaders of Y Combinator have infused into the program’s portfolio companies have become the playbook for building the next big thing, such as its focus on founder personality and more.
Reddit was one of the companies in Y Combinator’s first batch. While OpenAI wasn’t among the companies started at YC, Sam Altman, who would later become the AI company’s CEO, had a different company called Loopt in the first batch.
That’s lower than the most elite universities and colleges in the world—but insiders have some tips about how applicants can have the best shot of being accepted to the selective startup accelerator.
Y Combinator, the startup accelerator, gets its name from the “Y combinator” computer science concept. Specifically, something called a “Y combinator” in computer science is a function that runs programs, just like the Y Combinator startup accelerator runs a program that helps grow startups.
Want to see a list of all the companies YC has funded? We'll do you one better, being that the startup accelerator has funded more than 5,000 companies over the years. This YC-specific search engine lets you look up any company to find out if it's a YC alum.
Y Combinator invests $500K into each company in any given batch. $125K of that investment converts into a fixed 7% in ownership of the startup, and the other $375K is invested on something called an uncapped MFN safe. YC explains what that means and more terms of the deal in a detailed article on their website
In March 2005, Y Combinator cofounder Paul Graham announced the program that would become Y Combinator on his website.
He dropped out of Stanford to start Loopt, which sold in 2012 for $43.4M. You can watch his first-ever startup pitch in a video.
Those programs, such as Y Combinator and Techstars, not only offer expert advice to founders, but also seed funding in exchange for equity. The goal is to help young startups learn from successful companies, making it more likely they attract venture capital.
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