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Lightcone: Consumer is back, What’s getting funded now, The vibes immaculate

What's happening in startups right now and how can you get ahead of the curve? In this episode of the Lightcone podcast, we dive deep into the major trends we're seeing from the most recent batch of YC using data we've never shared publicly before. This is a glimpse into what might be the most exciting moment to be a startup founder ever. It's time to build. YC is accepting late applications for the Summer 24 batch: ycombinator.com/apply Chapters (Powered by https://bit.ly/chapterme-yc) - 00:00 - Coming Up 01:51 - AI companies in the batch 02:40 - Consumer ideas 04:46 - B2B ideas 06:45 - Developer tools 13:37 - Technical founder 16:41 - Platform shift 20:31 - What has YC funded less of? 31:56 - New initiatives 41:42 - Outro

Harj TaggarhostGarry TanhostJared FriedmanhostDiana Huhost
Apr 24, 202442mWatch on YouTube ↗

At a glance

WHAT IT’S REALLY ABOUT

YC’s AI Supercycle: Consumer Revival, Dev Tools Boom, Crypto Cools Off

  1. The Y Combinator partners discuss why the Winter 2024 batch feels uniquely energetic, driven largely by an AI platform shift that’s resetting what’s possible in software and startups.
  2. Roughly 70% of companies are AI-focused, with major growth in developer tools and open-source infrastructure, and a noticeable return of consumer ideas after years dominated by B2B SaaS and tech‑enabled ops-heavy businesses.
  3. The batch is far more technical (99% have technical founders), more U.S.-centric, and significantly earlier-stage, yet collectively tripled ARR in three months, reflecting how quickly AI products can translate into real revenue.
  4. Meanwhile, categories like local marketplaces, international clones, and crypto have sharply declined, as founders and investors reorient around AI-native opportunities where every legacy SaaS dollar feels up for grabs again.

IDEAS WORTH REMEMBERING

5 ideas

AI is now the primary startup frontier, not a niche.

Nearly 70% of YC’s Winter 2024 companies are AI-based, compared to 8% four years ago, signaling a true platform reset where new tools, apps, and business models are being invented rather than marginally improved.

Consumer startups are back—but must avoid “tarpit” ideas.

Founders are increasingly pivoting into consumer, which can be powerful and fun, but YC cautions against easy, overdone ideas (e.g., travel planning, bill-splitting) that feel intuitive yet are brutally hard to scale.

Developer tools and open source are booming alongside AI.

YC funded about 30% more dev tools than four years ago and 5x more open-source dev tool companies; patterns like RAG, fine-tuning, and evals are still immature, creating big “picks and shovels” opportunities for tool builders.

Highly technical founders now have a clear edge in AI.

With 99% of companies having a technical founder (up from 88%), cutting-edge AI work effectively requires deep technical competence, reversing the pandemic-era tilt toward domain experts in ops-heavy, tech-enabled businesses.

Crypto enthusiasm has been displaced by AI, even in a bull market.

Despite Bitcoin’s new highs, YC is seeing almost no crypto companies this batch, due to both regulatory chill and the fact that ambitious engineers now see AI—not crypto—as the most exciting, high-upside space to build in.

WORDS WORTH SAVING

5 quotes

There’s a platform shift, and this is the moment where every single SaaS dollar in the world is up for grabs again.

— Jared (YC Group Partner)

This batch has felt like there’s more energy than for as long as I can remember for any YC batch.

— Jared (YC Group Partner)

In 2020, starting a US-based consumer idea was ill-advised. If you were doing it, you were probably working on a bad idea.

— Harj (YC Group Partner)

Dev tools is basically B2B SaaS but consumer style—you’re marketing to 20 million developers instead of a billion consumers.

— Garry (YC Group Partner)

If now is the equivalent of 2007 for the web, it was still three years until Airbnb, five years until DoorDash, six years until Coinbase. These trends always play out much longer than people think.

— Harj (YC Group Partner)

AI as the dominant platform shift and its impact on startup ideasResurgence of consumer startups versus B2B SaaS and “tarpit” ideasExplosion in developer tools and open-source infrastructure, especially for AIShift in founder profile: more technical, younger, and Bay Area-basedDecline of crypto, local marketplaces, and international copycat modelsYC batch performance metrics: revenue growth, pivots, and product velocityInvestor sentiment reset and renewed willingness to fund category challengers

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