Here’s What Y Combinator Is Looking For in AI Startups Right Now

Y Combinator, the famed Bay Area startup accelerator, has released its quarterly request for startups for this fall. These requests give a sense of the types of companies that YC partners are looking to invest in, and this quarter, it’s all about AI.

All six of the firm’s requests for startups are for companies built with AI at the core. They’re looking for organizations focused on everything from retraining employees so that their skills are more relevant to the AI economy to growing a company to $100 billion in revenue with just 10 people.  Here’s what Y Combinator is looking to invest in this fall: 

1. Retraining workers to create AI infrastructure.  YC is looking for startups creating “a new kind of vocational school for the AI economy.” To keep the AI revolution going, massively ambitious infrastructure projects are needed to create data centers and chip foundries.  “While we’re focused on the race for AI talent, “we also have a shortage of skilled tradespeople—the electricians, the HVAC technicians, the welders—who are essential to building this physical infrastructure.” This need for more skilled tradespeople was echoed in the Trump administration’s recently released AI action plan.  YC wants to fund startups that use personalized AI to train people in trade-based skills in months rather than years, and then charge employers to hire those newly trained workers.  YC imagines that multimodal AI, which can process and generate various types of media, including images, video, and audio, could be a pivotal factor in making such a company work.
2. Novel uses for video generation.  YC is looking for startups that are taking advantage of the rapid technological progress of AI-generated video.  AI-generated video, especially videos created by Google’s Veo 3 model, can be incredibly lifelike while only costing a few dollars, and it’s only going to get cheaper going forward.  Because of the power and low cost of AI video, several potential ways for startups to create new kinds of businesses using the tech. Examples of what this could look like in practice, could be from creating “a brand-new season of your favorite canceled TV series,” to generating a digital double that can model clothes while you shop online, and even giving people the ability to hold video calls with AI versions of deceased relatives.
3. The first 10-person, $100 billion company.  A partner at YC, believes that AI tools have enabled small, high-agency teams to “build multibillion-dollar companies with as little as just $500,000 in funding from YC.”   Like how the rise of cloud computing made it easier for people to build businesses by eliminating the need to spend big on physical server infrastructure, AI is making it “easier for ambitious founders to scale with far fewer people.”
4. Infrastructure for running multiple AI agents.  YC is looking to fund startups developing tools that make it easier to build, run, and maintain a fleet of AI agents that can work in tandem. AI agents are essentially AI systems that can take actions on a user’s behalf, like navigating websites, sending emails, scheduling meetings, and completing digital workflows.
5. A true AI-powered enterprise system.  A new era for B2B SaaS is approaching, and just like the rise of Salesforce and ServiceNow, which took advantage of the cloud computing revolution to win over much more established competitors, YC sees a once-in-a-generation opportunity for founders to build new enterprise systems with AI “embedded deeply and thoughtfully throughout.  This next generation of B2B SaaS would enable employees to do their work faster and more accurately, comparing such a system to popular vibe coding app Cursor. Just like Cursor allows engineers to write and edit code faster, an AI-powered enterprise system could help people in sales, HR, and accounting.
6. An AI consultant for the government.  Y Combinator is looking for startups that are using large language models to create virtual consultants, specifically consultants for the United States federal government.  “Every part of the US government now runs on software, but usually custom software built by a consulting company,” and anyone who has used this software knows we can do a lot better,” especially with the rise of LLMs.  So YC wants to fund startups that are building AI-powered software that can do an improved job delivering this crucial government consulting work while costing a fraction of the price.