3 Reasons Why You Should Apply to Y-Combinator

3 Reasons Why You Should Apply to Y-Combinator



The Danish tech and entrepreneurship podcast, Fremtidsfabrikken has interviewed Henrik Zillmer, founder of one of the hottest Y-combinator startups in the world, Airhelp. In this blog post we will go through the reasons your startup should follow in Henrik's footsteps and apply for the Y-combinator. You can listen in on the whole story as a podcast at the end of this blog post.

What is the Y-combinator?

Let's start with the basics. Y-combinator is an accelerator that provides early-stage startups seed investment and advice in Silicon Valley. It is the biggest name among accelerators, having successfully accelerated some of the most successful startups of the 21st century like AirBnB and Dropbox.

But what sets the Y-combinator apart? The program requires active participation from the startups moving down to Silicon Valley for the period of 3 months for an intensive program, which is why the Y-combinator is often playfully referred to as a bootcamp. But beyond the intensity, Y-combinator is also a prime platform for building meaningful connections and gaining a leg up in developing your business.

Why you should apply for the Y-combinator?

You might have a multitude of reasons to want to join an accelerator program. But there are specific benefits to joining a world-class accelerator Y-combinator. In his interview, Henrik explains the process of taking part in Y-combinator and boils down what you get from the world’s most competitive accelerator program down to three key points:

1. Access to immense capital

Henrik tells how you can double or triple the valuation of your company after entering the program as an incredible amount of risk-willing capital is waiting to invest in Y-combinator startups. There are about 500-1000 high-performing investors waiting on demo-day to invest in every new batch of Y-combinator startups.

It almost sounds too good to be true right? Well there is always some sort of “catch”; Accepted startups get $100,000 for 7 % of the company. No more. No less. No negotiation. That’s the deal. But then again, if you can double or triple your otherwise expected valuation those 7 % become very small suddenly.

2. Connect with the right people

Being a part of Y-combinator gives you access to the entire alumni of Y-combinator companies and the hundreds of high-performing investors and so forth.

Many alumni companies can become your clients and you may even end up partnering up with some of them which can both help improve your product/service and boost your sales significantly. You can check out the entire alumni of Y-combinator companies here but some notable companies include Dropbox, AirBnB, Stripe, Coinbase, Twitch and Reddit.

You can also get a ton of feedback from this high-performing alumni of founders by for example sending out beta-versions of your new products or iterations. These are the right people to give you feedback unlike your friends and family even though some feedback is of course better than none.

Another important point is that Y-combinator primarily, though not solely, invest in companies that focus on or wants to enter the American market. So if the American market is one of the next steps for your business, then Y-combinator could very well be the right for you.

In addition, there are plenty of discounts available for the products and services of other Y-combinator companies whose products/services you may already be using.

3. Gain free publicity

Not only investors are waiting to get access to the many new promising Y-combinator startups - so does the media. If you want to enter and boost your presence in the American market, Y-combinator will be your way to lots of free publicity. Airhelp has for example been featured in both The Wall Street Journal, TechCrunch and even - as shown below - Fox News among many other news outlets.

How to get in to Y-combinator?

There is no ready-made formula for making it to Y-combinator. But we do recommend listening to the full story on how Henrik navigated through the application and interview process, including how their Y-combinator admission interview went terrible and led the founding team to the bottom of tequila bottles.

You can also read more on the application process through the Y-combinator FAQs, as well as this excellent read from Euwyn Poon the co-founder of Spin.