Elsewhere online
August 12, 2015

Silicon Valley Incubator Favors Nonprofits With Sustainable Funding

An article in Financial Times looks at the four nonprofits selected to participate in the next cohort at Y Combinator, the prestigious start-up incubator in Silicon Valley. Though most of the incubator's participants are for-profit companies, a handful of nonprofits have participated since 2013. One requirement is that they demonstrate a sustainable funding model.

“Most nonprofits would do well to look a little bit more like for-profit companies,” Sam Altman, Y Combinator's president, says in the article. “They need to have an intense focus on growth, and an intense focus on focus."

All participants get a chance to present their ideas to venture capitalists, entrepreneurs, and angel investors. But there is one difference: Commercial participants receive $120,000 in seed capital in return for Y Combinator receiving a 7 percent stake in the company. Nonprofits instead receive a charitable donation of $100,000.

One of the four nonprofits participating this summer is 80,000 Hours, a group founded by William MacAskill, associate professor of philosophy at the University of Oxford, whose book Doing Good Better advocates for the effective altruism movement.