- YC backs competing startups in same markets
- Founder quality trumps unique ideas
- Recent AI companies prove strategy works
Competition Breeds Success
Y Combinator, Silicon Valley’s premier startup accelerator, turns conventional wisdom on its head. Rather than seeking unique unicorns, YC embraces similar startups in its portfolio. Between 2022-2024, over a dozen AI code editor startups graduated from the program – some under the same partner’s guidance.
Follow The Money Trail
Popular YC categories paint a clear picture of market opportunity. AI dominates recent cohorts through code editors, sales tools, meeting assistants. Restaurant point-of-sale systems remain hot, building on past successes like Brex in corporate cards.
Founders Over Ideas
YC CEO Garry Tan stands firm on this strategy, publicly supporting product similarity across cohorts. A spokesperson emphasized their focus: backing exceptional founders who can build transformative companies, regardless of market overlap.
The recent PearAI controversy highlighted this philosophy when the AI code editor faced criticism for similarities to fellow YC company Continue.
