Aug 25, 2020 - Technology

Pandemic reshapes a cadre of Y Combinator startups

Illustration of a person at a computer wearing medical gloves with a lightbulb on the screen

Illustration: Sarah Grillo/Axios

The latest startups from Silicon Valley accelerator Y Combinator that showed off their products at its demo day Monday are the first group to experience the entire three-month program under COVID-19's shadow.

What's new: The pandemic not only pushed the whole Y Combinator process fully online but in many cases also shaped the startups' choice of market and product, with many tackling suddenly booming areas like online education, e-commerce, and remote communications.

The big picture: It's not surprising to see so many companies building tools and services that are directly useful during the pandemic. Entrepreneurs are known to be easily inspired by a crisis or challenge, and YC's latest group is no exception.

For example:

  • Young kids' online education: Startups like Hellosaurus and Zipschool say they've built entertaining, yet educational video content for young children — a promise that's sure to appeal to exhausted parents who have been juggling their own work while caring for kids full-time since schools closed in the spring.
  • E-commerce tools for small businesses: Companies like Hotplate, which lets chefs sell home cooked meals online, and In Stock, which lets customers get products delivered from local retails quickly, are tapping into the online shopping boom.
  • Remote work and socializing: Several Y Combinator startups, like workplace social network Mesh, are building tools for the new era of remote work. Others, like video-chat startups Rally and Together Video Chat, are tackling remote socializing.
  • Online entertainment: From artists and entertainers to fitness instructors, many professions have been forced to move their money-making activities entirely online. These include Jemi, which helps customers sell merchandise and virtual experiences like video chats to fans, and Reach.Live, which offers a suite of tools for running an online live content business.

1 fun thing: According to a few investors who spoke to Axios, one of the hottest deals in this group of startups is a company named Trove, which helps employers communicate and manage compensation packages for employees and candidates.

  • Trove isn't presenting this week to investors because it's already raised a sizable new round of funding led by Andreessen Horowitz, per sources. (The startup has not responded to Axios' request for comment.)

Go deeper: The pandemic downturn might yield a new startup wave

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