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Y Combinator ups its investment in startups to $500,000 per company

The famed startup accelerator used to invest $125,000 in each startup per batch.

Mug that says "we heart founders"

Y Combinator is giving founders even more money to be part of YC.

Photo: Shannon Rowies/Unsplash

In a sign of super-sized seed times, Y Combinator will now invest half a million dollars in every startup accepted into its program, it announced Monday. The famed startup accelerator had previously invested $125,000 in exchange for 7% of a startup as part of the terms of going through its program. Now it will be adding an additional $375,000, for a total of $500,000 for each company.

The idea is to give founders more upfront cash in the hopes "it will remove the immediate pressure to fundraise and accept less than favorable terms," Y Combinator said in its announcement. The extra $375,000 will be part of an uncapped SAFE with "most favored nation" status — in other words, it will enjoy the favorable terms offered to any subsequent investor, a safeguard often sought by early backers.

 Biz Carson

Biz Carson ( @bizcarson) is a San Francisco-based reporter at Protocol, covering Silicon Valley with a focus on startups and venture capital. Previously, she reported for Forbes and was co-editor of Forbes Next Billion-Dollar Startups list. Before that, she worked for Business Insider, Gigaom, and Wired and started her career as a newspaper designer for Gannett.

y combinator venture capital
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