Y Combinator has announced that it would be decreasing the amount of late stage investing to focus more on early stage investing which it is primarily known for.
The company made this known in a blog post by Garry Tan, its President & CEO. According to him, “YC is rightly known for early stage investing. In recent years, we have also done some late stage investing. But late stage investing turned out to be so different from early stage that we found it to be a distraction from our core mission. So we’re going to decrease the amount of late stage investing we do.”
He also announced that due to this strategic move, it is letting go of 17 employees on the late stage investing team.
Through its YCombinator Continuity Fund, YC typically provides funding for companies founded by YC founders at later stages, often investing in Series B and beyond.
The Information reports that the partners who led the fund, Anu Hariharan and Ali Rowghani, plan to leave the firm, to set up a fund together.
Garry Tan promised that there shouldn’t be any noticeable effect on the companies it has funded or on the way it interacts with alumni.
Amidst a significant decline in venture funding, especially for companies in their later stages, investors have become hesitant to invest large amounts in startups due to the decrease in value of similar publicly traded technology firms.
Tan took over as Y Combinator’s president and CEO at the beginning of 2023 after previous president Geoff Ralston announced he was stepping back
