Courtesy Y Combinator
Tech accelerator Y Combinator has given birth to so many of the country’s most successful startups—reddit, Dropbox, and Airbnb, to name a few—that it’s sometimes tough to remember that Y Combinator is a business in its own right. And nearly 10 years after it was founded, it’s a business that’s expanding in new ways.
On Tuesday, Y Combinator president Sam Altman announced that the Mountain View-based accelerator is launching a free online course on how to start a startup, which will feature lessons from the likes of Yahoo CEO Marissa Mayer, big-name venture-capitalist Marc Andreessen, and Y Combinator co-founder Paul Graham himself. Altman, who is also teaching a face-to-face course on the subject at Stanford, says he hopes the lessons will vastly increase the accelerator’s reach and double the pool of people who are inspired to launch businesses.
“I think there are a lot of people, who are exceptionally talented, who could be wonderful entrepreneurs, but for one reason or another—life circumstances, where they were born in the world, who their parents were—never think of it as a viable option,” Altman says. “I’d like to reach those people.”
The move is just another sign that change is afoot at Y Combinator. Since taking over from Graham as president earlier this year, Altman has made it clear that he wants to expand Y Combinator, not only in terms of the number of people it reaches, but also in terms of the scope and complexity of the companies it takes on.
This new direction reflects a larger trend in the tech industry, in which many critics have grown tired of these ubiquitous accelerators.
That mission was apparent at Y Combinator’s most recent demo day, where, among the usual consumer web and mobile apps, were audacious companies like Helion Energy, a nuclear fusion startup, Gingko Bioworks, a genetic engineering company, and Immunity Project, a nonprofit working on a free vaccine for HIV/AIDS. And last week, Y Combinator recommitted to this mission in its annual Request for Startups, in which the accelerator delineates the industries it’s particularly interested in. This batch focuses on “breakthrough technologies,” calling for startups working in fields as diverse as pharmaceuticals, human augmentation, virtual reality, and technology for the developing world.
This new direction reflects a larger trend in the tech industry, in which many critics have grown tired of these ubiquitous accelerators and the somewhat homogenous companies they tend to accept. There’s a growing notion – call it, bubblephobia – that accelerators are to blame for glutting the market with frivolous apps, launched by cookie cutter founders, who aren’t really solving the world’s biggest problems. Though Altman rejects that idea, in expanding Y Combinator’s horizons, he certainly seems to be using his time as president to rewrite the definition of the typical tech startup.
“I think it makes a lot of sense for them,” says Alejandro Amezcua, professor of entrepreneurship at Syracuse University, who researches business incubators. “They have so much experience training entrepreneurs and helping them solve problems, especially in the app and software area, it seems to me that maybe they’ve saturated that pretty well. It’s time for them to take on more challenging types of innovations where the success rate might not be as high and hurdles entrepreneurs face may be harder.”
Altman says he came to Y Combinator with the explicit mission of funding more “non-traditional software startups,” inspired by the fact that public funding for research and development has dwindled in recent years. “We need private companies to pick up the slack,” Altman says. So he and his Y Combinator partners came up with an all but exhaustive list of world problems they’d like to see more startups tackling.
Of course, the question remains whether Y Combinator is, in fact, the best place to launch the next big biotech company. After all, one reason the accelerator is so good at launching software companies is because it has software expertise to spare. Y Combinator’s relative inexperience is likely to inspire doubt from traditional research institutions about the accelerator’s ability to truly vet and develop these complex companies. “Any time you have a change in the approach that people take, you’re going to get strong reactions. My guess is you’ll see that here,” says Chris Laing, vice president of science and technology at the University City Science Center incubator in Philadelphia.
‘Any time you have a change in the approach that people take, you’re going to get strong reactions.’
Still, others say that approaching these entrenched industries from the outside can be beneficial. “I think it’s an advantage to look at problems with a fresh eye and not have a committee of guys that all came from pharma, and automotive, and energy,” says Bill Lee, a venture capitalist who has funded companies like Tesla and SpaceX.
Altman, for one, says he knows his ambitions may be perceived as naïve. “I just hope it’s the charming sort of naivete, and not the annoying kind,” he says, adding that while Y Combinator has plenty of in-house expertise in some of these subjects, he hopes to bring on more partners as the companies become more diverse.
But for someone who seems to have such a grand vision for the future of not only Y Combinator, but of the entire tech industry, Altman says his goal in all this is surprisingly simple: to help a lot of entrepreneurs. “Starting a company is such an improbably difficult thing to accomplish,” he says. “If we can change that, then I think we can make a lot more startups happen, and if a lot more startups happen, some of them will change the world.”
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