What 15 Years of Y Combinator Investments Can Teach Us About Startups

What is YC choosing to invest in, and why?

Eric Feng
Published in
6 min readDec 22, 2019


Credit: Y Combinator via Wikimedia

There are thousands of smart people who could start companies and don’t, and with a relatively small amount of force applied at just the right place, we can spring on the world a stream of new startups that might otherwise not have existed.
Paul Graham, co-founder of Y Combinator

II recently wrote a recommendation letter for a former co-worker who wanted to change careers by going back to school. Not just any school but a very specific world-class, prestigious institution with an acceptance rate in the low single digits. Harvard or Stanford MBA you might guess? Nope, something even harder to get into: Y Combinator. Entering its 15th year of operation, Y Combinator (or YC for short), has put over 2,000 companies through its program and produced 100 companies valued at over $150 million and 19 companies valued at over $1 billion.

YC is based on the laws of large numbers. A typical early stage venture capital firm will invest in 30–40 startups out of a single fund over 2–3 years. YC will accept into its incubator 8–10 times as many startups every single year. Another way to do the math is that it would take the combined output of 30 VC funds to invest in as many companies as YC does. YC touches so many companies that it is in effect an index on the entire early stage venture capital industry, like the Dow Jones Industrial Average for public stocks. The Dow isn’t the stock market but it is certainly representative of the stock market. Similarly, YC isn’t all seed investing, but what it chooses to invest in is representative of overall seed investing activity, and thus an opportunity to find insights and see trends.

So what is YC choosing to invest in?

YC by the numbers

Sometimes people think Y Combinator has big ideas about themes. But really, we just fund the best startups.
Sam Altman, Chairman of YC

To answer that question, I crawled YC investment data going back to the first batch from 2005 and found some interesting observations to share.

First off, the number of startups YC invests in each biannual batch has grown by an order of magnitude since…



Eric Feng
Writer for

Current: Co-founder of @cymbalxyz, Co-founder of @GoldHouseCo Ventures. Past: @Meta (via Packagd), GP at @KleinerPerkins, and CTO of @Hulu and @Flipboard.