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Y Combinator, the startup accelerator that has launched the likes of Instacart and Airbnb, has broadened its investing lens in recent years, backing companies all over Africa and India, and beyond. As the tech downturn has continued, though, Y Combinator has shrunk its cohort size, stepped back from late-stage investing, and brought on a new chief executive: entrepreneur and co-founder of Initialized Capital, Garry Tan.<\/p>\n
In many ways, it\u2019s a new era \u2013 but in some, it\u2019s a return to the accelerator\u2019s former geographic roots.<\/p>\n
Y Combinator\u2019s winter 2023 batch has 282 startups \u2013 and 86% of the founders lived in San Francisco for the duration of the batch. This compares to 30% of founders living in the Bay in the batch prior.<\/p>\n
\u201cHayes Valley truly became Cerebral Valley this year \u2014 San Francisco\u00a0will<\/span> continue<\/span> to<\/span> play<\/span> a<\/span> big<\/span> role<\/span> in<\/span> the<\/span> future<\/span> of<\/span> technology<\/span> and<\/span> will<\/span> continue<\/span> to<\/span> bring<\/span> together<\/span> some<\/span> of<\/span> the<\/span> smartest<\/span> minds<\/span> in<\/span> the<\/span> world,\u201d Tan said, kicking off Y Combinator\u2019s newest Demo Day. \u201c<\/span>The<\/span> SF<\/span> Bay<\/span> Area<\/span> is<\/span> still<\/span> a<\/span> place<\/span> for<\/span> dreamers<\/span> and<\/span> doers<\/span> to<\/span> try<\/span> their<\/span> hand<\/span> at<\/span> their<\/span> own<\/span> future.<\/span> and<\/span> we<\/span> have<\/span> so<\/span> much<\/span> work<\/span> to<\/span> do.\u201d The firm is throwing a\u00a0summer conference later<\/a> this June in Palo Alto, and conducted a series of dinners \u2013 as well as a kick off event \u2013 across the Bay for this cohort.\u00a0<\/span><\/p>\n Tan declined an interview request by TechCrunch.<\/p>\n The accelerator says it is still remote-friendly \u2013 for example, it still only has a virtual demo day \u2013 but the return to the Bay Area also means a step back from international investments. Just 21% of publicly-announced startups in the winter 2023 batch are based internationally, compared to 42% in the batch prior. While this is the first batch that is launching on Demo Day with Tan at the helm, the accelerator says founders were interviewed months before his first day.<\/p>\n This is the first year in the recent past that YC hasn\u2019t flexed the geographic breakdown of its startups in its blog post. Last batch, India topped the charts as the most represented country within the cohort, home to 21 companies, beyond the United States. This batch, India\u2019s presence has nearly been cut in half, with only 11 publicly-announced companies coming from the country. There are only 3 known startups from Africa in this batch, down 88% from a year ago, and continuing a retreat that began last year.<\/a><\/p>\n The Bay area\u2019s philosophical return as a startup hub has partially been chalked up to its emergence as an artificial intelligence hot spot. Thanks to hacker homes and word of mouth, Hayes Valley has been dubbed by entrepreneurs and investors alike as \u201cCerebral Valley,\u201d which many see as the convergence of aspiration and opportunity<\/a> (too much, even).<\/p>\n The accelerator\u2019s return to the Bay Area is likely not disconnected to AI\u2019s boom: a third of the companies in this cohort are building in AI<\/a>, and a fifth \u2013 or 54 total \u2013 are specifically building generative AI startups.<\/p>\n Y Combinator isn\u2019t alone. 500 Global just had a Demo Day based in San Francisco, although its class of startups came from all over the world. Techstars, one of the largest pre-seed investors in the world, just launched a new accelerator in Oakland, California. And earlier this week, Amazon announced a generative AI accelerator, with a demo day culminating in San Francisco.<\/p>\n<\/p><\/div>\n