SAN FRANCISCO Dec 16 Yuri Milner, the Russian
investor known for his bets on Facebook Inc and Twitter
Inc, is pulling out of an arrangement that let him
invest automatically in a group of companies participating in a
program called Y Combinator.
The companies will instead receive investments from
venture-capital firm Khosla Ventures, Y Combinator said in a
blog post on Monday.
Milner "has been spending less time focused on seed-stage
investing," the blog post said. "Yuri originally came up with
the idea for investing in all YC companies, and we're grateful
to him for that and for all the years he has participated."
A spokesman for Milner did not immediately respond to a
request for comment.
Since announcing his backing of Y Combinator companies in
early 2011, the Russian billionaire has stepped up commitments
to other areas, especially China. The investment fund he runs,
DST Global, has backed Alibaba Group and 360buy.com; his
personal investments include online smartphone retailer Xiaomi.
Twice a year, Y Combinator admits about 50 young companies
for instruction in entrepreneurship and introductions to key
players in Silicon Valley.
Many of its most valuable alumni attended the program well
before Milner and other investors began automatically funding
all the program's companies.
The graduates that have given Y Combinator its sterling
reputation include accommodation service Airbnb, whose founders
attended in 2009. File-sharing service Dropbox and Web hosting
business Weebly attended in 2007, while digital library Scribd
attended in 2006.
"As far as we can tell based on valuations, the companies in
recent batches are doing as well as the ones in past batches," Y
Combinator co-founder Paul Graham said in an e-mail.
When Milner started automatically backing all Y Combinator
companies in 2011, each start-up received $150,000 from Milner
and investor Ron Conway, founder of SV Angel, an investment
fund. In late 2012, Y Combinator said it would cut the amount to
$80,000 and add additional venture firms to the program:
Andreessen Horowitz, General Catalyst and Maverick Capital.
Khosla Ventures has previously backed a handful of Y
Combinator companies, including grocery-delivery company
Instacart and lab-management software company Quartzy.
"KV is exactly the kind of partner we want at YC - we admire
their tenacity and willingness to making bold technology bets,"
the Y Combinator blog post said.