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Business Insider
07-08-2025
- Business
- Business Insider
YC founders are getting younger and feeling the pressure
Y Combinator founders are getting younger and are expected to move faster than ever because of AI, recent participants told Business Insider. Each tenet of the startup incubator's latest requests for startups described companies with AI at their core, and roughly 70 of the 143 startups in the spring batch were focused on agentic AI. AI is "deep within YC," one founder who recently completed the program and asked not to be identified to speak freely told Business Insider. Cohorts are dominated by AI companies, and the accelerator's internal Bookface platform is increasingly recommending AI tools for founders, they said. Akash Sharma, the CEO of AI startup Vellum, who was part of the Winter 2023 class, said YC has incorporated helpful AI tools into its Work at a Startup recruitment platform, including candidate matching and personalized outreach text. Mentors within the program encourage founders to use AI in their workflows and automate rather than hire to keep teams lean, said Cekura founder Sidhant Kabra, who participated in the Fall 2024 cohort. Participants also get early access to beta AI tools from tech giants, such as OpenAI, he said. The startup world's AI obsession is hardly exclusive to YC, but it's accelerated the program's cadence, some participants said. In expediting every step in the startup pipeline from vibe coding to R&D to marketing, AI has also ratcheted up expectations that founders should have fully realized products or more customers with bigger contracts by Demo Day, Kabra said. YC CEO Garry Tan told CNBC earlier this year that revenue for YC batches was growing at an average of 10% week-over-week. In the past, a founder might be pre-product market fit or have a few users or design partners, Kabra said. Now, "within three months, you're able to close enterprise contracts over $100k," he said. "That's a big change." Increasingly younger cohorts Expectations are climbing as the program has become shorter, the first founder who recently completed the program told Business Insider. YC pivoted from a biannual to a quarterly schedule last fall — a move CEO Garry Tan told Bloomberg at the time would result in smaller batches and additional Demo Days. Founders spoke glowingly of YC, calling the experience transformative, but the pace can have drawbacks. In optimizing for Demo Day, some participants may not always be making the best long-term decisions for their companies, Kabra said, such as signing lots of customers too fast or ones at a discounted rate. "If you weren't in YC, you would make different choices," the first founder told Business Insider, saying Demo Day serves as a proof-of-concept. "After Demo Day, there's a classic YC slump — and then you readjust and start building for the long term." "AI is enabling founders to move faster, and we're here to help them harness that momentum not just for Demo Day, but to build enduring, world-changing companies," a YC spokesperson told Business Insider. The AI boom has also resulted in increasingly younger cohorts. YC General Partner Pete Koomen told The New York Times that the median age of YC participants was 24, down from 30 in 2022. Venture capitalist Gabriel Jarrosson wrote on LinkedIn that the number of accepted applicants between ages 18 and 22 was up 110% year-over-year. Younger entrepreneurs are less entrenched in their ideas and have grown up with AI, founders told Business Insider. YC is "actively encouraging younger people to come into the fold," Sharma said. He added that YC's public-facing recruitment materials emphasize being a builder above all else. "All you need to do is be able to build good products, and YC will take care of the rest." Ultimately, the saturation of AI companies within YC has sparked criticism that many of its startups are similar. "You hear the phrase AI agent so much and you're like, my mind is going insane," the first founder said. But the competition is motivating, Kabra said, given that execution is paramount and consolidation amid the AI gold rush is inevitable. While many of its startups "may explore similar areas," the YC spokesperson said, that "encourages open-source progress, which in turn, enriches the competitive landscape, gives consumers more choice, and reflects our abundance-oriented view of the future."
Time of India
11-07-2025
- Business
- Time of India
Y Combinator CEO Garry Tan warns engineering and business college students: This mindset may land you in jail
Garry Tan , CEO of startup accelerator Y Combinator , has issued a stark warning to engineering and business students: adopting a 'fake it till you make it' mindset. Tan emphasised that that such a mindset, if taken too far, can lead to severe legal repercussions, including jail time. Tired of too many ads? go ad free now Speaking at Y Combinator's AI Startup School during a live recording of the Lightcone Podcast, Tan criticised some academic entrepreneurship programs that promote deceptive practices. 'We're very worried about them because what we're coming to understand is they are teaching you to lie,' he said. 'That's a waste of time — and you're gonna go to jail.' Y Combinator CEO Garry Tan's warring for engineering and business college students Tan directly criticized unnamed university entrepreneurship courses , suggesting they might be fostering an environment where students feel encouraged to bend the truth in their pursuit of startup success. He emphasised that while ambition and innovation are important, they must be grounded in honesty and integrity. Tan referenced disgraced tech founders Sam Bankman-Fried (FTX) and Elizabeth Holmes (Theranos), both convicted for fraud and sentenced to lengthy prison terms. He warned the students that who follow the same path of exaggerating traction, misleading investors, or fabricating product capabilities they have the risk of ending in jail. 'They don't represent us!' Tan declared, distancing Y Combinator's ethos from the high-profile scandals that have tarnished Silicon Valley's reputation. Tan and his colleagues argued that many college entrepreneurship courses offer a 'cheap facsimile' of real startup life. Jared Friedman, YC's managing director, said these programs often teach rigid formulas and encourage hype over substance. 'Anytime you try to bottle up entrepreneurship and teach it as a college course, what you end up with is a method, not a company,' he said. Tired of too many ads? go ad free now They also criticized institutions for restricting access to AI tools like Cursor, an AI-powered code editor, which they believe are essential for modern startup development. Tan has also asked the budding entrepreneurs to go for transparency, build real products, and avoid shortcuts. 'Software is the most empowering thing in the world. Why do you have to lie?' he asked. His message: success should be earned through innovation and integrity, not illusion.
Yahoo
09-07-2025
- Business
- Yahoo
Y Combinator CEO Garry Tan warns students that a 'fake it till you make it' business mindset could land you in jail
Y Combinator CEO Garry Tan said that some college entrepreneurship programs were "teaching you to lie." Tan, who runs a startup incubator, said the "fake it till you make it" attitude wasn't necessary, and warned it can backfire. Tan said that students were learning to "become more SBFs and Theronoses," giving tech a bad reputation. Garry Tan says too many business students today are being taught to fudge the truth — and warns that going down that road could lead to serious consequences, like jail time. Speaking to an audience of undergraduate, graduate, and Ph.D. students during a live recording of Y Combinator's Lightcone Podcast, Tan criticized unnamed academic entrepreneurship programs that he claimed teach a "fake it till you make it" attitude. "I'm very worried about them because what we're coming to understand is they are teaching you to lie," Tan told the audience at Y Combinator's AI Startup School conference. "Software is the most empowering thing in the world. Why do you have to lie?" Tan runs Y Combinator, astartup accelerator that pulls from a similar talent pool and has produced breakout successes like Airbnb and Doordash. After a competitive application process, YC promises mentorship, investor connections, and a $125,000 seed and $375,000 SAFE note in exchange for a 7% equity stake in startups selected for the program. Jared Friedman, YC's managing director of software and former cofounder of Scribd, said that academic programs suffer because they aren't run by founders. "Anytime you try to bottle up entrepreneurship and teach it as a college course, what you end up with is basically a cheap facsimile," Friedman says. "They teach you to follow a particular method or a particular practice and that's just not what startups are actually like." Tan said that these programs were teaching students to "fake it till you make it" and "lie to investors." He also warned that such ideas could lead students to become founders like FTX's Sam Bankman-Fried, who was sentenced to 25 years in prison, and Theranos' Elizabeth Holmes, who was sentenced to over 11 years in prison. "That's a waste of time, and you're going to go to jail," Tan said. He spoke against how Bankman-Fried, Holmes, and other "fake" founders grew to represent the tech industry, chanting, "They don't represent us!" to applause from the audience. Earlier in the conversation, Tan and his YC colleagues also said the unnamed academic entrepreneurship programs don't promote AI use. Diana Hu, YC group partner and former cofounder of Escher Reality, asked which students in the audience were allowed to use Cursor, an AI code editor. When limited hands were raised, Hu said, "This is the future." "They're quite literally prohibiting the students from learning the tools that they are going to need," Friedman said. Read the original article on Business Insider
Hindustan Times
06-07-2025
- Business
- Hindustan Times
Y Combinator CEO lashes out at ‘anti-YC bullsh*t' after fake rejection letter goes viral
The CEO of Y Combinator has lashed out at haters after a fake rejection letter, attributed to the startup accelerator, went viral on social media. Garry Tan called the fake rejection letter a 'sad attempt' at seeking attention while drawing attention to a larger trend of hate against Y Combinator. Garry Tan, CEO of Y Combinator, slammed a fake rejection letter that went viral online.(Instagram/garrytan) Y Combinator (YC) is a startup accelerator based in Silicon Valley that helps early-stage startups grow by providing funding, mentorship and networking opportunities. The accelerator is famously selective, choosing startups through a rigorous application and interview process What did the fake letter say? On July 5, an X user named Maze shared what he claimed was a rejection letter he received from Y Combinator. It later turned out to be a forgery, but it managed to fool tens of thousands of viewers before Tan's clarification. Maze claimed that his startup OpenCut had been rejected by Y Combinator for using only lowercase letters in the application. 'Hi Maze, Thanks for applying to Y Combinator. After reviewing your application, we've decided not to move forward,' read the realistic-looking rejection letter. 'One recurring piece of internal feedback: the decision to format the entire application in lowercase made it difficult to evaluate. While unconventional formatting isn't disqualifying on its own, it signals a lack of attention to detail and clarity - both of which matter to us,' the letter continued. 'We understand stylistic choices, but in a high-signal, high-noise environment, presentation is part of communication. Yours detracted from the content.' The letter was signed 'YC Admissions Team'. Y Combinator CEO's clarification Garry Tan, CEO of Y Combinator, dismissed it as a 'sh*tpost' while he requested social media to stop with anti-YC hate. 'This is a sh*tpost and a craven and sad attempt at attention, FYI. We don't have an 'admissions team' anymore, we stopped using that term more than a year ago,' Tan posted on X, sharing the letter. 'The amount of anti-YC bullsh*t that is going on in the community is off the charts. Please stop,' he added. How the internet reacted While many were amused by the fake rejection letter, some said it was worth looking into why Y Combinator is becoming fodder for jokes and memes. 'You can get mad, but it's also an opportunity to reflect on why YC's admission process became a source of parody,' posted Dan Bochman. To this, Tan replied, 'We're trying to add more partners and grow it so we can fund more companies.' 'I say this as someone who has never applied to YC and therefore has no bitterness or anything, but maybe there is need for some self reflection. Stuff like stealing open source projects, YC companies being fooled by scam artist, the fact that 'demo day' no longer includes demo,' another X user pointed out.
Associated Press
02-07-2025
- Business
- Associated Press
Entrepreneur and Angel Investor Kulveer Taggar Launches Phosphor Capital, Focused on Early-Stage Companies That Have Participated in Y Combinator
SAN FRANCISCO, July 02, 2025 (GLOBE NEWSWIRE) -- Well-known entrepreneur and angel investor Kulveer Taggar has launched a new investment firm, Phosphor Capital, focused on investing in early-stage companies that have participated in Y Combinator. To date, Phosphor Capital has raised and invested $34M. Portfolio companies include Reducto, Delve, Circleback and Gumloop. Phosphor Capital limited partners include a well-known, top tier asset manager with over $10B in Assets Under Management (AUM), several family offices, and well-known Bay Area accredited investors. 'Early-stage venture only works when investors move at founder speed,' said Garry Tan, President & CEO of Y Combinator. 'Kulveer proved he can sprint; Phosphor Capital will let more YC teams tap that momentum, and I expect LPs will be thrilled with the outcomes.' Taggar has participated in YC twice as a founder - in 2007 with Auctomatic (co-founded with Harj Taggar, Patrick Collison and John Collison and acquired by Live Current Media) and in 2011 with Zeus Living (acquired by Blueground). He has an eye for talent, and has maintained close relationships with many YC partners from his 18 years as an entrepreneur and investor in the YC community. Taggar founded Phosphor Capital in early 2024 after selling Zeus Living to Blueground. He decided to focus the fund's investments on YC companies to best leverage his network and because he believes CEO Garry Tan is taking YC in exciting new directions. As an angel, Taggar wrote 200+ checks in the last 12 months and received a YC Rating of 'Best' from dozens of partners and founders. Taggar is known for his deep relationships within the YC community, and for all the research he does while investing. He endeavors to personally meet at least half of the founders in each YC batch, and to invest in the top 15-20 percent of companies in each batch. 'Over time, it's been shown that 6.5 percent of YC companies become unicorns,' says Taggar. 'That's one in 15. It's a fertile ecosystem for an investor like me who knows the Y Combinator world well.' Early Phosphor Capital seed companies are now moving on to Series A rounds at far higher valuations. One is Reducto, which just announced a $24.5M Series A. Reducto co-founder and CEO Adit Abraham said, 'We're lucky to have Kulveer on board. He helped us win a key early customer a month after investing, helped re-calibrate our hiring efforts at an important inflection point, and as a former founder, is someone I feel comfortable having truly important conversations with. We feel like we can ask him anything.' 'If you could have one angel, get Kulveer,' said Karun Kaushik, CEO of Delve. 'He's closed pivotal early hires that were on the fence, took hours to talk through difficult situations, and game-planned our fundraising strategy. Communicating with him feels like getting advice from an experienced founder friend, not an investor. Kulveer's always in your corner and fighting for you - even on Sunday night calls. He genuinely cares. I couldn't speak more highly of him.' Phosphor Capital currently has 225 portfolio companies that have raised, in total, $720M. Twenty five of the portfolio companies hit a run rate of $1M in ARR in less than 12 months. 'I've been to every YC demo day since 2007 and have seen the generational companies at their earliest stages,' said Taggar. 'I've also lived every founder extreme: pivot hell, blitzscaling, cofounder turnover, board pressure. I now channel those scars into an unfair edge for the next wave of YC founders. Phosphor's mission is simple: help YC founders sustain their brilliance for the decade it takes to build something truly great.' About Phosphor Capital Founded and led by YC alum and serial entrepreneur Kulveer Taggar, Phosphor Capital is focused on investing in early-stage companies that have participated in Y Combinator. Taggar is a 2x YC founder who invested in companies like Mux, Boom and Plenful as an angel prior to launching his own fund. Phosphor Capital has raised and invested $34M to date, fully invested in YC startups including Reducto, Delve, Circleback and Gumloop. Taggar is known as a founder-friendly investor who provides a lot of guidance for startups, both tactical and strategic. He's passionate about ensuring founders make the right early hires and don't burn out. Learn more at Media contact: Michelle Faulkner Big Swing [email protected] 617-510-6998 A photo accompanying this announcement is available at
