YC’s Changes and the Shifting Fundraising Landscape

For years Y Combinator has increased the number of startups accepted into its accelerator program. Each subsequent winter and summer has brought larger cohorts, with the past three classes each seeing more than 300 participating companies. With an increase in batch size, YC has also shifted its focus to include more companies from outside the United States.

Reviewing startup information provided on the YC website, we can get a sense for how YC’s geographic focus has changed over time, in addition to cohort growth:

Looking at the breakdown of YC cohorts over time, we can see a clear shift in focus, with 2021 and 2022 both seeing nearly half of all participating companies coming from outside the United States (a big increase from the mere ~16% seen in 2016). Focus shifts at YC are indicative of broader industry sentiments surrounding international deal flow, with opportunities outside of the US gaining in prevalence among notable investors.

In addition to the US market, global markets have always been a key focus at Stonks. Looking at a similar breakdown of companies pitching on platform in 2022, we see a healthy balance of companies based both inside and outside the United States.

Nearly half of all companies pitching on Stonks are based outside the United States, with some months seeing as many as 61% of all pitching companies based in international regions. With demand from startups and partners remaining high, the number and diversity of investment opportunities is expected to remain strong at Stonks.

This may be especially good news for those following recent announcements at YC. For those who haven’t heard, YC’s summer 2022 cohort is expected to be the smallest seen since 2020.

Not only are overall class sizes expected to be smaller going forward, 2022 is the first year since 2018 to show companies from the US increasing as an overall percentage of total participants at YC. Smaller class sizes mean it will be harder for all startups to be recognized. However, with YC’s current US / international split sitting at 50%, the impacts of these changes will be biased towards those companies located outside the United States. Hundreds of startups that would have been selected had trends of recent years continued will now be turning to alternative options and programs.

With international engagement at all-time highs, and high investor demand on platform, what better place to come than Stonks?