Y Combinator’s Most Recent Winter 2023 Batch Shows A Shift To AI, DevTools And B2B

In the current downturn, the most recent batch out of Y Combinator signals a shift to B2B and DevTools as AI dominates the conversation.

From the companies launched at demo day on April 5th and 6th we find smatterings of LLM, coding assistants, data entry help, data pipeline management, customer service automation, text to voice, video generation and more. Many of these tools are targeting businesses that would benefit from task automation.

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Sectors that lost out are consumer, which is down from 13% to 5% of companies when comparing the winter 2022 batch to 2023; fintech from 24% to 12%; and health care from 11% to 7%.

Verticals below 5% are climate and energy, proptech, aerospace and education. These sectors were flat or down year over year, with education not even reaching 1% of startups in this past batch.

We tracked all the companies with funding here for Pro users to export. This list also includes the 70+ companies tagged with AI in Crunchbase.

Also worth noting is the geographic shift for the new cohort. For this batch, a higher proportion (80%) hailed from the U.S. and Canada. For winter 2022 around 50% were based outside of the U.S.

Illustration: Dom Guzman