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Y Combinator narrows current cohort size by 40%, citing downturn and funding environment – TechCrunch


Y Combinator speak it has intentionally narrowed down the number of startups in its accelerator for Summer 2022. As first reported by The Information and independently verified by TechCrunch, Y Combinator’s Summer 2022 research group – currently active – boasts nearly 250 companies, a 40% decrease from the previous group, which had 414 companies.

Y Combinator’s head of communications, Lindsay Amos, confirmed the drop in text messages, saying the shipment was still large “compared to the annual batches of the past five years.”

“Lot S22 is significantly smaller than our most recent batches. This was intentional,” the statement read. Amos said that the economic downturn and changes to the venture funding environment have caused YC to reduce the number of companies funded from W22 to S22. Many investors already argues that early-stage and seed-stage startups, A world in which YC’s accelerator primarily exists, has been immune to macroeconomic stresses because of the way it has been removed from late-stage valuations. This latest move by YC shows that such early-stage companies are not immune to the effects of a recession.

In May, the accelerator advised its portfolio founders to “plan for the worst.”

“You can often gain significant market share during a recession just by surviving,” says leading startup accelerator Y Combinator wrote in an internal e-mail to its founders this week. The advice is one of ten highlights in the memo aimed at helping companies navigate the economy crushing technology degradation. Other prominent quotes include “nobody can predict how bad the economy will be, but things don’t look good.”

Email is a change of vibes from just a few weeks ago, when hundreds of Y Combinator startups — many of which have already raised venture capital — went public on Launch Day. The startups are the first to receive Y Combinator’s new $500,000 standard check and are very focused on international opportunity. Now, YC is saying that “this slowdown will have a disproportionate impact on international companies,” among others.

Today’s confirmation, ahead of the upcoming Intro Day in September, shows how things have changed.

“We continuously evaluate every aspect of our shipments and the environment in which companies will operate, and as a result, shipment sizes vary from season to season and from year to year. ,” Amos continued via text.

It is unclear whether Y Combinator will continue to operate at a more concentrated capacity in future production runs. When asked, Amos said that YC is just starting to accept applications for the next batch and will evaluate “every aspect of our batch and the environment in which the companies will operate to determine the size batches”.

Over the years, the growing batch size of Y Combinator has become a common – if not cliché – conversation among technicians. Some say that the bulky size of the Y Combinator reduced the participants’ ability to stand out. Meanwhile, the organization told tech blog Newcomer that it can power 1,000 startups a day on its own. Amos says that YC has not scaled up due to criticism or the cost of its growing check size.

This move will certainly help those in the existing group stand out more, simply due to the lack of competition. It’s another way YC, even unintentionally, helps its startups market better. A few weeks ago, Y Combinator Announced YC Launcha platform where people can sort the accelerator startups by industry, batch and launch date to discover new products.

As I wrote at the time, YC Launch looks like Y Combinator’s strategically logical answer to one of the loudest criticisms of its model in recent years: as its cohort size has increased, it’s harder than ever to stand out in a group. Today’s news, depending on how you view it, could be another answer to questions surrounding YC’s distribution efficiency.

Current Y Combinator cohort participants can contact Natasha Mascarenhas via e-mail at natasha.m@techcrunch.com or on Signal, a secure encrypted messaging app, on 925 271 0912.



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