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Popular silicon valley-based seed funding start-up accelerator, Y Combinator has announced it will be cutting down the number of start-ups it will be funding this summer.
Citing economic downturn and venture capital funding as the major cause of the downsizing, the firm which is known to invest large sums in early stage start-ups made the announcement recently as it hopes to reduce its class size and seed funding.
Since its establishment in march 2005, over 3000 companies have benefitted from its seed funding while touting itself as the accelerator of choice for entrepreneurs seeking seed funding.
Some notable start-ups that have benefited immensely from Y Combinator include Stripe, PayStack, Flutterwave, Eventbrite, DoorDash, Airbnb, Coinbase, Zapier and Reddit. 250 firms, down 40% from the previous class which had 414 start-ups.
The Summer batch is held from June-August while the winter batch takes place from January – March.
When the start-ups are finally selected after a rigorous round of evaluations, they are now taken through the three-month program which ends in a demo day.
This affords the start-ups to meet and relate with other Start-up founders, venture capitalists, and executives from big tech companies.
The start-ups can now pitch to other investors and can raise more funding during their presentations on the demo day.
While confirming this position, the head of communications in Y Combinator, Lindsay Amos, argued that when compared to the last five years of batches, the batch size is still large.
Amos also revealed that the changes to the venture funding environment and the economic downturn had caused Y Combinator to reduce the number of companies funded between W22 and S22.
The downsizing may be good news for Techies after all, as some have previously complained that Y Combinator’s excessive size has undermined the opportunity for members to stand out.
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