i, it’s Alexandre from Eurazeo (ex. Idinvest). I’m investing in seed & series A consumer and consumer enablers startups all over Europe. Overlooked is a weekly newsletter about venture capital and underrated consumer trends. Today, I’m digging into YC’s most recent batch to spot recurring tech trends from the 400+ participants.
As usual, I reviewed the startups in the latest YC batch (see editions for the previous batches here: YC-W20, YC-S20, YC-S21). As a reminder, YC is the largest accelerator worldwide. It’s a 12-week remote program that happens twice a year and YC invests $500k in every company it accelerates.
I cowrote this edition with Elise who is working with me at Eurazeo!
We brainstormed together and came up with the following trends in this batch: (i) climate, (ii) no-code, (iii) orchestration, (iv) product as API, (v) “X for Y startups”, (vi) making SaaS companies more efficient, (vii) vertical solutions for local businesses and (viii) consumer verticalised marketplace.
Metrics
- YC broke a new record with 410+ startups participating in this latest batch (10% increase vs. previous batch, 100%+ increase vs. YCS20 batch).
- For the 3rd consecutive batch, US startups aren’t the majority. 50% of startups are from other countries than the US and 10% are from Europe.
- YC remains dominated by 4 main verticals capturing almost 90% of the startups: B2B software, consumer, fintech and healthcare.
- 19% of YC-backed startups in this batch have at least one female cofounder which is significantly more compared to what we see in most VC funds’ portfolio.
Climate
If there’s one thing to remember from this YC batch, it’s the clear breakout of Climate tech, with almost 30 new companies in the space (vs. 15 in the summer 2021 batch).
A notable difference in this winter 2022 batch is that the space is moving from pure software plays (carbon accounting, carbon offsetting etc) to real-life hardware innovations:
- We’re particularly interested in players developing new materials to reduce carbon emissions:
- Carbon crusher re-uses old road materials to crush roads in need of maintenance, replacing oil with carbon binding lignin
- Phase Biolabs builds a fermentation technology to convert CO2 emission into carbon-negative solvents used in the pharma, sosmetic and paint industries
- Alga Biosciences modifies kelp to create a feed additive for cattle that stops them from producing methane.
- Technologies are also emerging to remove or capture carbon, in the air (Airmyne) or in the sea (Seabound).
