Since its inception, Y Combinator has invested in thousands of startups, and more recently even hundreds in a single batch. Given the growth of the accelerator, competitive tensions seem almost inevitable.
Still, one has to wonder if there is a fundamental change afoot. While YC has always backed companies that might at some point overlap, the company seemed to stretch its network far and wide, bringing in different startups at different stages from different geographies – companies that were using each other’s products. , in fact, and formed close ties through YC. network of former assets.
Now, however, YC seems to actively rely on startups that are roughly the same age, operating in the same countries, and targeting the exact same opportunity with nearly identical business models. Indeed, while similar types of businesses within a class had become unavoidable as YC’s class sizes grew, some sort of similarity is more apparent than ever with its latest batch of 400 startups. In fact, it seems the plan here is to support as many fledgling rival teams as possible – and then let them compete.
Unsurprisingly, Y Combinator sees things differently. At least, when asked about the many startups that would seem to compete with each other from the outset, a spokesperson for YC wrote in an email: “These companies are not in the same groups and do not interact. Additionally, it is common for startups to pivot during the batch.
In the meantime, we’ve rounded up some of the startups that seem we overlap – a lot – in its winter 2022 batch.
TradeX and better opinions
Founded in the same year and in the same place, TradeX and Better Opinions have the same goal: to give people a way to bet – and earn – money on their predictions. Startups are building platforms where people can trade money while betting on whether an outcome will happen or not, from launching a movie to who the next president will be. There are also more serious future events to bet on, such as climate change, inflation, and whether omicron cases will increase or decrease in a particular location.
The only clear difference between the two companies is that TradeX targets high-income Indians and Better Opinions is more characterized by inclusiveness and accessibility.
Firezone and Netmaker
As early as 2018, our very own Romain Dillet was building his own VPN server using WireGuard, a faster and more secure alternative to existing VPN software. Firezone and Netmaker, both participants in this batch of Y Combinator startups, are open-source VPNs built on top of WireGuard. Netmaker claims it is 15 times faster than popular VPN software OpenVPN, while Firezone says it is 4 times faster. But speed isn’t everything – the companions of the competing cohort will have to fight to offer better customer service, firewall options and ease of use than the other. Both startups have a free plan and a paid plan for large sales teams, but neither company shares the prices of these paid plans, so we can’t compare their prices yet.
Streak and Yoda
Consider that Streak and Yodaa are both under two years old, both based in Bangalore, and both trying to build banking businesses that cater to teens by both educating them about their spending and helping them save. (Both also offer a playful approach, in which kids can earn coins for certain spending behaviors.) It’s pretty clear that these two will be competing for the same customers, who probably won’t be using two different banking apps. (More here.)
Finku and Pina and Sribuu
All Three of these companies are Jakarta-based personal financial advisor startups that were founded within the last couple of years. Yes, Indonesia is a big market, but also, come on.
Tradezi and Anfin
Tradezi is a start-up based in Ho Chi Minh City, Vietnam, calling itself the “Robinhood for Southeast Asia”. What it does (or will do): Offers free online trading accounts that allow users to invest in stocks, cryptos, and other alternative assets all in one place. It sounds a lot like Anfin, which is a Ho Chi Minh City-based startup building a digital brokerage in Vietnam connecting users to the stock market in an “easy and intuitive way.” Investors could sign up for both companies’ brokerage accounts, but would they?
Clupp and Momento
The insurance market, especially for vehicles, is far from saturated in Latin America, with only 30% of cars and 10% of motorcycles covered, according to Clupp, an online insurance startup founded in 2021 and based in Mexico. Indeed, Clupp sees a big opportunity in providing more affordable insurance for low-risk drivers in Latin America. The same goes for Momento, which was also founded in 2021 and is based in Mexico City and also seeks to insure drivers and bikers in the region. The big difference (so far): Momento says it’s working through the regulatory process to be a fully licensed insurer; Clupp seems to work with an insurance company fully licensed to offer its products (Mapfre for cars and HDI for motorcycles).
beU and HeyFood delivery
Prior to this year, YC had not supported a food delivery startup in Africa. So it was a bit surprising to see two such companies – beU delivery and HeyFood – in one batch.
We understand YC is excited to support food delivery businesses after seeing DoorDash go public. These startups operate in distant African markets – beU delivery in Ethiopia and HeyFood in Nigeria – but over time they will expand into similar markets and compete for the same customers in their offerings to become the premier delivery platform of the region.
Dojah and ID Pass
Both platforms, founded in 2021 and based in Lagos, play in the identity verification space. Dojah claims to be an “all-in-one know-your-customer (KYC) and identity verification platform for Africa,” while Identity Pass claims its infrastructure enables digital businesses in Africa to “ easily verify their customers in seconds”. ”
It’s easy to assume that the market is huge for both players, but customers will have to choose one of the two services or switch periodically depending on speed, the level of information they offer, who fights the virus better. fraud and prices.
Naturally, even startups with a different approach can compete for space soon enough. As we have seen with fintech in particular, all fintech products become horizontal until they fade. That’s why SoFi now offers stock investing, Robinhood offers a debit card, and more. Once you’ve finished the job of bringing a consumer into the fold, you want them to sell them as many products as possible – so you keep adding more.
This means that no matter where this cohort starts (some are robo-advisors, some Robinhood clones, some neobanks, some insurtech, numerous tackle carbon emissions), Y Combinator has invested money and energy in many companies that could find themselves competing with each other sooner rather than later. While they can strike up friendships and become each other’s customers, you can also easily foresee, in some markets, more battle royale than just dust.