1. The Scale of the AI Gold Rush
Some numbers to understand how crowded this is:
| Metric | Number |
|---|---|
| Total YC AI startups (all time) | 1,444 |
| W2026 batch AI companies | ~50 (out of ~70 total) |
| S2025 batch: companies described as "AI agents" | 67 out of 144 |
| S2025 batch: companies referencing "AI" in pitch | 60%+ |
| W2024 batch: AI startups | 86 (nearly 2x W2023) |
| W2024 batch: B2B companies | 162 (enterprise-dominated) |
Translation: every other YC company is now an "AI" company. The word "AI" in your pitch means nothing for differentiation. What matters is the specific problem you solve and the specific customer who pays.
The giants that emerged from YC's AI category:
| Company | Batch | What They Do | Scale |
|---|---|---|---|
| OpenAI | S2015 | AI research, ChatGPT, GPT models | $150B+ valuation |
| Scale AI | S2016 | Data labeling and AI infrastructure | $14B valuation |
| Checkr | S2014 | AI-powered background checks | $5B valuation |
| Podium | W2016 | AI lead management for local businesses | $3B+ valuation |
Notice: the biggest winners are from 2014–2016. They had first-mover advantage. In 2026, the same playbooks are 10x more crowded.
2. The W2026 Batch (~50 AI companies)
The W2026 batch is overwhelmingly AI agents. Here are the companies, grouped by what they actually do:
Vertical AI Agents — Industry-Specific (15+ companies)
- Beacon Health — Healthcare
- AI agents for primary care handling value-based care workflows in EHRs.
- Ruma Care — Healthcare
- Automates prior authorizations for specialty medications at infusion clinics.
- Stilta — Legal
- AI-native software for patent attorneys. Agentic workflows reducing manual research ~60%.
- Maywood — Investment Banking
- Automates deal execution: presentations, models, diligence responses.
- Fenrock AI — Financial Compliance
- AI agents preventing financial crimes for regulated institutions.
- Panta — Insurance
- Autonomous commercial insurance brokerage run by AI agents.
- End Close — Payments
- Automatic reconciliation for payments companies using AI ops agents.
- Robby — Home Services
- AI growth engine for home services: revenue discovery, technician talking points.
- Reframe — Manufacturing
- AI agents managing overseas hardware manufacturing and negotiations.
- Pollinate — Procurement
- Agents operating on procurement ontology: three-way matching, invoices.
- FullSeam — Accounting
- AI employee logging into accounting tools to complete routine finance tasks.
- Librar Labs — Libraries
- Intelligence layer for physical world; library management.
- Autumn AI — Sales / GTM
- Real-time signal intelligence monitoring buying signals for sales teams.
- Vela — Scheduling
- AI scheduling assistant handling ambiguity for recruiters and sales.
- Samora AI — Voice Operations
- Multilingual voice operations for high-volume calling without engineering teams.
AI Infrastructure / Platforms (10+ companies)
- Salus
- Runtime API blocking incorrect agent actions. Agent safety layer.
- Sentrial
- Monitoring for AI products: loops, hallucinations, user frustration.
- Terminal Use
- Orchestration for background agents. CLI-first.
- Emdash
- Agent-first IDE. Run multiple coding agents in parallel.
- Cascade
- Infrastructure for autonomous intelligence with self-improving safety.
- Polymath
- Applied research lab: reliability and autonomy of AI agents.
- Moda
- Alerts when things go wrong with your AI agents.
- Orthogonal
- Instant access to hundreds of APIs through MCP/SDK for agents.
- Overshoot
- Real-time vision applications with VLMs under 200ms.
- Piris Labs
- Photonic hardware for AI inference. Eliminates data movement bottleneck.
- Oximy
- Enterprise AI governance: track adoption, control spend.
Robotics / Physical AI (5 companies)
- Congruent
- Radars for autonomous systems with raw sensor data + world-model simulator.
- Asimov
- Diverse human motion datasets teaching robots physical interaction.
- Origami Robotics
- "Manipulate anything" model with hand-based robotic data collection.
- Servo7
- Robots deploying in existing operations, learning from demonstrations.
- Aurorin CAD
- CAD software built from scratch with AI at its core.
Biotech / Drug Discovery (2 companies)
- CellType
- Agentic drug company: AI agents running drug discovery with biological foundation models.
- Strand AI
- Foundation models predicting missing biological data from measured readouts.
Consumer / Creative AI (4 companies)
- Wideframe
- AI agent for video production work outside the NLE.
- CodeWisp
- Build and publish web games using plain-English prompts.
- Polymorph
- Learns from product signals to personalize responses automatically.
- Unisson
- AI subject-matter experts for customer-facing teams. Learns product in 20 min.
Fraud / Security (3 companies)
- BeeSafe AI
- Engages fraudsters to prevent trust-based attacks (pig butchering).
- MouseCat
- Detects, investigates, and mitigates emerging fraud trends automatically.
- Sponge
- Infrastructure for AI agents to hold and spend money.
Other / Niche
- Tsenta (S2026)
- Desktop app matching you with jobs, optimizing profile, applying on your behalf.
- VOYGR
- Place intelligence platform for AI agents. Maps + web context.
- Ashr
- Test and evals platform for AI agents.
3. Category Clusters (across all YC AI batches)
| Category | Estimated Count | Crowdedness | Examples |
|---|---|---|---|
| Vertical AI Agents (industry-specific) | 200+ | Extremely crowded | Healthcare, legal, insurance, accounting, real estate agents |
| AI Coding / Developer Tools | 100+ | Extremely crowded | Emdash, Cursor competitors, test generators |
| AI Infrastructure / MLOps | 80+ | Very crowded | Agent orchestration, monitoring, memory, safety |
| Voice AI / Conversational | 50+ | Crowded | Samora AI, call centers, voice agents |
| AI for Sales / GTM | 50+ | Crowded | Autumn AI, lead scoring, outbound agents |
| AI for Finance / Accounting | 30+ | Crowded | FullSeam, reconciliation, bookkeeping agents |
| Robotics / Physical AI | 20+ | Moderate | Origami, Servo7, Asimov, autonomous vehicles |
| AI for Healthcare | 40+ | Crowded | Beacon Health, Ruma Care, prior auth, claims |
| AI Biotech / Drug Discovery | 15+ | Moderate | CellType, Strand AI, protein folding |
| Consumer / Creative AI | 30+ | Crowded | Video generation, game builders, content tools |
The uncomfortable truth: there are 1,444 YC AI startups. Across all the venture-backed AI companies globally, we are looking at tens of thousands. The vast majority will die. The survivors will be the ones with:
- Deep domain expertise (you know insurance / healthcare / legal better than any AI lab)
- Distribution advantage (you already have the customers)
- Data moats (proprietary data that improves the product)
- Revenue from day 1 (not "let's get users then figure out monetization")
4. Applying the DHH / Jason Fried Filter
The DHH/JF approach to AI: AI is a tool, like a database or a CDN. You do not sell "we use PostgreSQL." You sell "we manage your invoices." Same with AI: sell the outcome, use AI to deliver it at absurd margins.
5. Categories to Skip
| Category | Why Skip |
|---|---|
| Foundation Models / AI Research | OpenAI ($150B), Anthropic ($60B), Google, Meta, Mistral. Requires billions in compute. Skip. |
| AI Infrastructure / MLOps | 80+ YC companies + AWS SageMaker + GCP Vertex + dozens of VC-funded platforms. Deep technical moats required. Enterprise sales. Skip. |
| AI Coding Tools | Cursor, Claude Code, GitHub Copilot, Windsurf + 100 YC companies. The most suicidal category to enter. Skip. |
| AI for Sales / GTM | 50+ companies. Plus Salesforce Einstein, HubSpot AI, Gong, Outreach. Crowded to the point of absurdity. Skip. |
| Robotics / Physical AI | Requires hardware, massive R&D, manufacturing. Multi-year timelines. Skip. |
| AI Biotech / Drug Discovery | Requires PhDs, wet labs, clinical trials, FDA approval. Skip. |
| Consumer / Creative AI | Race to the bottom on price. Consumers expect free. Midjourney, Suno, Runway already dominate. Skip. |
| Voice AI (generic) | 50+ companies + Bland.ai + Vapi + Retell. Commoditizing fast. Skip generic voice. But: vertical voice (see survivors) can work. |
What is left after this massacre? A surprisingly small number of approaches that are both AI-powered and bootstrappable.
6. What Survives the Filter
The key insight: AI is the leverage, not the product. You sell a specific outcome to a specific industry. AI makes it 10x cheaper to deliver. The customer does not care about your model. They care about the result.
Option 1: AI-Powered Productized Services — the #1 pick
Why: This is not a product. It is a service delivered with AI leverage. You sell the outcome, AI is your unfair margin advantage. The W2026 batch is full of "AI agent for X" — but most of them are building platforms that need adoption. You can skip the platform and sell the service directly.
Proven examples from the YC landscape:
- FullSeam does AI bookkeeping → you can do AI bookkeeping as a service
- Stilta does AI patent research → you can do AI document research as a service
- Casey does insurance submissions → you can do AI data entry as a service
The DHH play:
- Pick one boring back-office task (bookkeeping, data entry, document processing, transcription).
- Offer it as a managed service: "send us your [X], we deliver structured [Y]."
- $500–5000/month per client.
- Use Claude / GPT-4 + custom workflows to deliver at 90%+ margin.
- Sell on LinkedIn. No product to build. No infrastructure to maintain.
- This is the fastest path to revenue in the entire AI landscape.
Option 2: Vertical AI for a Boring Industry You Know
Why: 200+ YC companies are building vertical AI agents. Most will fail because the founders do not know the industry. If you have domain expertise in a specific boring industry (plumbing, HVAC, dental offices, auto repair, property management), you have a moat that no AI lab can replicate.
The DHH play:
- Pick an industry you know or can access (through LinkedIn connections, family, etc.).
- Build one simple tool that solves their #1 pain point.
- Examples: AI receptionist for dental offices, AI estimate generator for contractors, AI follow-up system for auto repair shops.
- $100–500/month per business. Thousands of potential customers.
- Distribution: industry-specific LinkedIn groups, trade shows, referrals.
Option 3: AI-Powered Localization / Translation
Why: From the open source analysis, Lingo.dev does AI localization. But the opportunity is bigger than one company. Every SaaS expanding internationally needs translation. The Samora AI model (multilingual voice) validates global demand. AI makes translation 10x cheaper than human translators.
The DHH play:
- AI translation service or tool for SaaS companies.
- Translate app UI, docs, marketing content.
- $50–300/month or per-word pricing.
- Use Claude/GPT-4 for translation + human review for quality.
- Target: indie SaaS makers on Twitter/LinkedIn expanding to non-English markets.
Option 4: AI Governance / Usage Tracking for SMBs
Why: Oximy (W2026) helps enterprises track AI usage and control spend. But enterprises are not the only ones with this problem. Every company is now grappling with: which AI tools are employees using? How much are we spending on API calls? Are we leaking data to ChatGPT? This is the new compliance category.
The DHH play:
- Simple dashboard: track AI tool usage, API spend, and data exposure across your team.
- $50–200/month for small/mid companies.
- Sell the fear: "do you know what your employees are pasting into ChatGPT?"
- Light integration: browser extension + API key tracking.
Option 5: AI-Enhanced Scheduling / Booking
Why: Vela (W2026) does AI scheduling for recruiters/sales. Calendly does $230M ARR with a simple scheduling tool. AI can make scheduling smarter: understand context, negotiate times, handle complex multi-party coordination. The market is proven and enormous.
The DHH play:
- Calendly competitor with AI: smarter scheduling, fewer back-and-forth emails.
- $15–50/month per user. Self-serve.
- Or: vertical scheduling for a specific industry (medical appointments, contractor bookings, restaurant reservations).
- Proven market, proven willingness to pay, AI as genuine differentiator.
7. The Street-Smart Verdict
| Option | SNOLOC | TTFP | Recurring? | Bootstrap Score |
|---|---|---|---|---|
| AI-powered productized service | ~0 | Days | Monthly | |
| Vertical AI for boring industry | Medium | Weeks | Monthly | |
| AI scheduling / booking | Medium | Weeks | Monthly | |
| AI localization / translation | Low–Medium | Weeks | Monthly | |
| AI governance / usage tracking | Medium | Weeks–Months | Monthly |