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Y Combinator: key trends from Winter 2016 Demo Days

Let's have a look at the biggest trends of Y Combinator Winter 2016 ranging from robotics to chatbots and the freelance economy.

Y Combinator

Y Combinator (YC) is often called "the most powerful early stage startup incubator in the world". It has been founded in 2005 right at the heart of Silicon Valley, in Mountain View, by entrepreneur and essayist Paul Graham, his wife Jessica Livingston, Robert Morris (writer and entrepreneur who created Viaweb, a startup later bought by Yahoo! with Graham) and Trevor Blackwell, a robotics specialist who has created a human-sized two-legged walking robot, among other inventions.

YC creates opportunities for seed funding for startups, however its support, advice and wide spread network attract thousands of startups each year.

Since 2005, more than a thousand startups received money from YC and their combined valuation is of over $65 billion. For instance, it has given birth to Airbnb, Instacart, Reddit, Stripe, Clever or Twitch.

From a 127 startups accelerated at YC from January to March 2016, L'Atelier has scouted 5 major trends: robotics, precision health, freelancing, startups focused on emerging markets and chatbots. We also introduce you to our 3 favorite projects.

Y Combinator's statistics

Y Combinator: No sector immune to robotics

By April 25, 2016
La robotique touche tous les secteurs

A glance at the startups that went through Y Combinator’s first season of 2016 clearly indicates that industrial robots are not to be found exclusively in the automobile manufacturing business. They are being deployed in a broad range of sectors, including biochemistry and agriculture.

Automation has been described as the fourth industrial revolution and Y Combinator’s first class of 2016 clearly demonstrated the growing importance of robotics across a number of industrial sectors. By 2018, 1.3 million industrial robots are expected to be deployed in factories all around the world. The number one driver for this surge is the United States automobile sector, the International Federation of Robotics predicting that about half of all industrial robots in service by then will be installed by car makers and their suppliers. However, the latest crop of Y Combinator startups highlight the fact that industry across the board is already feeling the impact of robotics. GeckoRobotics, with offices in Pittsburgh and Silicon Valley, for example, has just launched a robot which is specially designed to carry out technical inspections on boilers at power plants. These inspections, which are normally carried out by human hand, on average twice a year, can be extremely dangerous work. Moreover, claims GeckoRobotics co-founder Jake Loosararian, the necessary shutdowns cost the US energy sector a total of some $15 billion a year. The Gecko robot – designed to climb vertical surfaces like the insect after which it is named – enables inspections to be carried out seven times faster, and collects ten times more data than inspections carried out by human beings. This looks like a great way for the electricity industry to save on costs, as deploying Gecko robots to perform the six-monthly inspection will cost a power company just $50,000 to $100,000. The startup’s target markets also include the oil and chemical industries.

Robots for research

Robotics is also being used in various fields of research. Recent Y Combinator graduate OpenTrons builds robots to help biologists with repetitive pipetting work, i.e. transferring a measured volume of liquid from vial to vial with a pipette. Explains Will Canine, co-founder of the Brooklyn, New York City-based startup: “Whether you’re doing research into cancer, developing new medicines or working to create new molecules, you’re constantly transferring by hand small quantities of liquid from one test tube to another. This takes time and slows down the science.” The OpenTrons robot serves as a personal laboratory assistant that can be activated remotely from a simple web browser. Biologists simply download the protocols from the cloud to run their experiments. The protocols are open source and everyone is invited to contribute to improving the platform. Thus this approach is “democratising” the tools that enable protocols to be shared, argues Canine. The company has grown by 50% per month since it entered the Y Combinator programme and started generating profit last month. As an estimated four million biologists make pipette transfers almost every day and the OpenTrons assistant carries a price tag of around $5,000, this potential market represents a $20 billion opportunity for the company, in addition to the lucrative laboratory reagents market, the second thrust of the firm’s business model, which Canine estimates at an annual $27 billion.


Potential for robots in the agriculture sector

Agriculture is another of the leading economic sectors likely to be strongly impacted by robotics. By 2020 the market for agricultural robots is set to reach over $16.3 billion. However, while there are many robot systems in use to perform such tasks as counting or collecting fruit in orchards, San Francisco-based Y Combinator graduate Iron Ox takes a different approach: not focusing on one single link in the production chain but aiming to manage the entire process of growing ‘fresh and sustainable produce’ at low cost in robotic greenhouses without any human intervention. Co-founder Brandon Alexander points out that manpower accounts for a third of the total cost of fruit and vegetable production. Accordingly, his fellow-founders – who earned their stripes at robotics research lab and technology incubator Willow Garage and Google X – have started to develop autonomous robots, including a mobile terrestrial robot capable of managing thousands of greenhouse plants, plus a planter robot, which are both currently being put through their paces in a test greenhouse growing lettuce, basil and Chinese cabbage. “The future of agriculture is automation! This is just the beginning!” Brandon Alexander predicts.


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