"We are interested in how companies like Y Combinator can use the blockchain to democratize access to investing," said Sam Altman, who leads the accelerator, on stage at Disrupt yesterday. "We should try to figure that out."
Our sources tell us YC is actually a little farther along than that. Like a growing number of venture groups that are jumping into the digital currency world, the group is actively working on how it might use cryptocurrency to expand the investment pool. There are still legal and other details that are being examined, the sources say.
Speaking at the TechCrunch Disrupt conference in San Francisco, Altman actually painted a mixed picture of the role of ICOs in the tech world today. It wasn't all good.
Altman highlighted how there are still a lot of questions to be resolved about how they work -- including whether they are transparent and legal, and effective. Counterbalanced with that is a very strong current of hype.
"I think ICOs are definitely a bubble right now," he said, "but there is something underlying them, which is why smart people are fascinated."
He also made a case for why there should be more government involvement in how ICOs are run.
"Do I think ICOs are silly, bordering on scams? Yes, they are," he continued. "But, there are a few that are important, and the is blockchain more important than not... ICOs need to be regulated."
The idea of using a new investment format -- one that would potentially open up YC to a much wider pool of backers -- wouldn't necessarily represent a big shift for YC, which has big ambitions to become a much bigger operation, despite its almost exponential growth under Altman's leadership.
At the same time, it could mean working, for the first time, with investors who are not "accredited," meaning high net worth investors -- an idea that appeals to Altman. To date, Y Combinator has been associated with some of the most elite and successful startups of the world, as well as the most elite and successful venture capitalists, with early investors in the program including names like Sequoia Capital, SV Angel, and Yuri Milner of DST.
The gap between this group of VCs and the wider world is big.
YC has meanwhile continued to ramp up its accelerator activities. In addition to its core YC program, the organization has started to focus also on maturing startups through its later-stage Y Continuity Fund; it also runs an online, 10-weeks long Startup School that touches 3,000 startups at once, Altman said yesterday.
Still, Altman has plain ambitions to back many more startups. Asked on stage if he planned to double the size of YC, which Altman had said last year it was his ambition to do, he smiled. “We’ve gotten significantly more ambitious in the last year . . . I think we can figure out a way to make a whole lot more startups happen and really help them."
Added Altman of the appeal of ICOs in particular, "People are watching their friends get really rich and it's making them [frustrated and wanting to get rich, too]."
"One of the trends that bothers me about Silicon Valley," he continued, is that "more and more of the wealth creation here is not available to most people, and I think that’s very bad in a society with already so much wealth inequality. If there’s a way that new technology can make it practical and possible to democratize this, I think that’d be great."
Ingrid Lunden and Connie Loizos - TC
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