Y Combinator Cut Back On African Startups, But New Plan Spells Rebound

Y Combinator (YC), Silicon Valley’s most prestigious startup accelerator behind global successes like Airbnb and Stripe, has long been a catalyst for early-stage founders worldwide. African startups have benefited significantly from YC’s global expansion, with the accelerator backing over 100 startups on the continent, including fintech giants like Flutterwave, Paystack, and Wave.

However, recent trends have shown a sharp decline in the number of African startups accepted into YC cohorts, raising concerns about the future of YC’s involvement in Africa. Yet, with YC’s newly announced year-round program set to launch in 2025, there’s reason to believe that this shift may offer a path to a rebound for African founders.

Scaling Back in Africa: A Sudden Decline

In 2022, Y Combinator slashed its global summer cohort by 40%, a move attributed to the economic downturn and shifting venture capital landscape. African startups felt this cutback acutely, as the number of African companies accepted into YC dropped by more than half. The S22 batch included only eight African startups, compared to 24 in the previous W22 cohort—a staggering 63% decline.

This downsizing trend continued. In the W23 cohort, only three African startups made the cut. By W24, reports confirmed that only three African startups—Cleva and Miden—were selected, with Kenyan traveltech startup Triply completing the trio. This cutback didn’t go unnoticed, with many founders voicing concerns about the shrinking opportunities for African startups in YC’s once-welcoming embrace.

“We continue to be impressed with the talent and ingenuity of African founders,” said Michael Seibel, YC’s managing director, in a 2022 Techpoint report. Yet, despite this sentiment, YC’s focus appeared to shift toward more U.S.-centric ventures. Over 90% of the W23 cohort was made up of U.S. startups, reflecting a growing trend of YC refocusing on its home market.

The Impact on African Startups

For many African founders, acceptance into YC has been more than just a badge of honour—it has been a critical turning point in their journey. The accelerator’s USD 500 K funding and powerful network have helped startups secure follow-on investments and scale across borders.

However, as YC scaled back its involvement in Africa, many founders were left wondering what the future held. Research from Briter Bridges highlighted the outsized role YC plays in the African startup ecosystem, with its portfolio companies raising over USD 1.3 B in follow-on funding. The fear, therefore, is that a reduced YC presence in Africa could choke off vital funding pipelines and stunt the growth of the continent’s fledgling tech scene.

Yet, others remain optimistic, favouring the sentiment that while the cutback may pinch, the African tech ecosystem is evolving and there are now several other sources of funding.

With local early-stage funds like Microtraction, Ventures Platform, Future Africa, and LoftyInc, as well as accelerators like Techstars, African founders are finding alternative ways to raise significant capital without YC’s involvement. Notably, Iyin Aboyeji, famously behind two African tech unicorns and backing startups via Future Africa, has recently set up Accelerate Africa, which is being touted to replace YC in Africa.

YC’s Year-Round Program: A Path to Rebound?

While YC’s cutback on African startups over the past few years has raised concerns, its newly announced year-round program—set to debut in 2025—could present an opportunity for a rebound. This expansion will see YC doubling its cohorts from two to four annually, with continuous application cycles allowing for more flexibility and increased access for founders worldwide.

By offering spring and fall cohorts in addition to the traditional winter and summer ones, YC will now be accepting startups throughout the year. For African founders, this means that opportunities to join YC may become more frequent, without the long waits for application windows.

With smaller cohorts—around 100 to 125 startups per session—founders could also benefit from more personalised attention, potentially recreating the tight-knit, high-support environment that has made YC so transformative in the past.

“The great thing for everyone is we will be more responsive to founders and fund them right when they start,” said Garry Tan, YC’s President. The W24 batch, the smallest since 2017, signalled a return to exclusivity, but the upcoming year-round model promises to combine the best of both worlds: access for more founders and high-quality mentorship.

This new approach could help reverse the trend of declining African participation. With more cohorts and continuous cycles, African startups—particularly those solving pressing financial inclusion and logistics challenges—may have more opportunities to break into the accelerator.

Challenges and Opportunities

However, the shift comes with potential challenges. Some worry that four Demo Days per year instead of two might dilute the significance of the event, making it harder for startups to stand out. Historically, Demo Day has been a make-or-break moment for many startups, with limited slots ensuring intense competition for investors’ attention.

That said, the increased number of Demo Days could also provide more tailored and focused interactions between founders and investors. As Tan noted, “4X in-person Demo Days will benefit both founders and investors by creating more time and space for meaningful interactions.”

Moreover, while YC’s expansion brings new hope for African startups, it also arrives at a time when local ecosystems are maturing rapidly. Accelerators like Techstars are stepping up, and local funding instruments are gaining traction. As YC opens its doors wider for longer, African founders have more options than ever before, allowing them to weigh their choices and determine what best suits their needs.

A Future of Possibility

YC’s upcoming year-round program marks a significant shift in its global strategy, one that could potentially reignite its involvement in Africa. For African founders who once saw the declining acceptance rates as a sign of YC’s retreat from the continent, this new expansion may offer a much-needed opportunity for renewed participation.

With smaller, more focused cohorts and more frequent Demo Days, YC is positioning itself to provide founders—both in Africa and beyond—with the support and network they need to thrive in a rapidly changing tech landscape. While the road ahead may still hold challenges, the prospects for African startups to rebound within YC’s network appear brighter than they have in years.