AI driving revenue growth for latest cohort of Y Combinator accelerator
The winter 2025 batch of Y Combinator companies in aggregate grew 10 percent per week.
CNBC reports that Silicon Valley’s earliest stage companies are getting a major boost from artificial intelligence (AI).
Y Combinator, known for backing Airbnb, Dropbox, and Stripe, recentlyheld its annual demo day in San Francisco, where founders pitched their start-ups to an auditorium of potential venture capital investors, and Garry Tan, Y Combinator Chief Executive Officer, told CNBC that this group is growing significantly faster than past cohorts, including actual revenue. The winter 2025 batch of Y Combinator companies in aggregate grew 10 percent per week, he said.
“It’s not just the number one or two companies – the whole batch is growing 10 percent week on week,” said Tan, who is also a Y Combinator alum. “That’s never happened before in early stage venture.”
That growth spurt is thanks to leaps in artificial intelligence, he added.
App developers can now offload or automate more repetitive tasks, and they can generate new code using large language models. Tan called it “vibe coding,” a term for letting models take the wheel and generate software. In some cases, AI can code entire apps.
Y Combinator was founded in 2005 by Paul Graham, Jessica Livingston, Robert Morris, and Trevor Blackwell. The firm invests $500,000 in start-ups in exchange for an equity stake. Those founders then enter a three-month program at the San Francisco headquarters and get guidance from partners and Y Combinator alumni. Demo day is a way to attract additional capital.
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