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Y Combinator Constricts Summer 2022 Cohort Size by 40%, Citing Downturn & Funding Environment

Image Credits: Bryce Durbin (opens in a new window)/ TechCrunch

Y Combinator says it has intentionally shrunk the number of startups within its accelerator for the Summer 2022 batch. As first reported by The Information and independently verified by TechCrunch, Y Combinator’s Summer 2022 cohort — currently in action — boasts nearly 250 companies, down 40% from the previous cohort, which landed at 414 companies.

Y Combinator’s head of communications, Lindsay Amos, confirmed the reduction over text message, saying that the batch is still large “relative to the last five years of batches.”

“The S22 batch is significantly smaller than our most recent batches. This was intentional,” the statement reads. Amos said that the economic downturn and changes to the venture funding environment caused YC to reduce the number of companies funded between W22 and S22. Many investors have argued that pre-seed and seed-stage startups, the world where YC’s accelerator primarily exists, have been immune to macroeconomic tensions because of how removed the stage is from late-stage valuations. This latest move by YC illustrates that such early-stage companies are not immune to the effects of the downturn.

In May, the accelerator advised its portfolio founders to “plan for the worst.”

“You can often pick up significant market share in an economic downturn by just staying alive,” top startup accelerator Y Combinator wrote in an internal e-mail to its founders this week. The advice was one of 10 bullet points in a memo meant to help companies navigate the economic downturn crushing tech. Other stand-out quotes include “no one can predict how bad the economy will get, but things don’t look good.”