Y Combinator's all-star alum and VC Garry Tan returns to take over the accelerator as its chief executive

• The Initialized Capital founding partner Garry Tan is taking over as the CEO of Y Combinator.
• A founder in Y Combinator's 2008 cohort, Tan served as a partner at the firm from 2010 to 2015.

Garry Tan, the early-stage investor who founded Initialized Capital, will be taking over for Geoff Ralston in early 2023 as the president and CEO of Y Combinator. Both Initialized Capital and Y Combinator shared the news in blog posts on Monday.

"My goal has been to cement YC as an institution that will endure for decades," Ralston wrote, announcing his decision to step down. "Garry, the visionary hacker, designer, and builder who has described how YC is 'engraved on his heart' believes in this future and is precisely the right person to take over as YC's chief executive."

"It's a one in ten billion lifetimes kind of opportunity," Tan said in a tweet Monday morning. "YC gave me my start, and I'm deeply grateful to the community."

The tech community weighs in

Many of Tan's contemporaries, such as Paul Graham and Alexis Ohanian, who founded Initialized with Tan, shared their congratulations on Twitter. Venture capitalists also weighed in on what the move meant for the storied accelerator.

"Because he's been in the community for so many years as a trusted advisor and friend to so many, he has the entire community's support," Avichal Garg, the managing partner at the seed fund Electric Capital, told Insider.

Tan's appointment as CEO could be the publicity boost YC needs, some venture capitalists have speculated.

"It felt like the brand was waning a bit," Sheel Mohnot, a general partner at the early-stage firm Better Tomorrow Ventures, told Insider. "If you asked most people who was the leader of YC they may not have even known, so I think Garry can really turn it around."

Tan is no stranger to Y Combinator. He went through the famous startup accelerator with his blogging platform Posterous in summer 2008 and served as a YC partner from 2010 to 2015.

After cofounding Initialized with Ohanian and the YC group partner Harj Taggar in 2011, Tan grew the firm into a $3.2 billion fund, which has backed unicorn startups like Instacart and Patreon.

He's also a well-known "VC pundit," with a YouTube channel where he discusses insights into his career and early-stage investing. The channel has amassed more than 220,000 followers.

The announcement comes as Y Combinator gears up for its summer 2022 Demo Day, where the latest cohort unveils what they've been building over the past three months. The class size was slashed by about 40% compared with the winter 2022 batch, The Information reported earlier this month.

The effect on Initialized

A spokesperson for Initialized Capital said in a statement that Jen Wolf and Brett Gibson would be taking over for Tan as managing partners for the $3.2 billion fund. Wolf will continue to lead Initialized's general operations, and Gibson will lead the firm's investment strategy.

"I've known Jen and Brett in aggregate longer than I've been alive," Tan said in a blog post. "They are both incredible leaders who have elevated themselves over time, founders love them, and they are world-class, high-integrity investors who have shepherded billion-dollar startups. I have the utmost respect for and confidence in them."

It's less clear how Tan's new role will affect Initialized's brand. The firm already lost one well-known founder when Ohanian stepped aside to start a fund, Seven Seven Six, in 2020. On Twitter, some have asked if Tan's successors can replace his star power.

"I hadn't heard of either of the partners they named as successors," Mohnot said.

Most venture firms have a restriction in their agreements with the limited partners who back them called a "key-man provision." This provision stipulates that if a prominent partner leaves the firm or becomes less active, the limited partner no longer has to pony up the capital it committed. After Ohanian left, a firm spokesperson told TechCrunch's Natasha Mascarenhas that Ohanian did not trigger such a clause in his departure.

Initialized declined to say whether a key-man provision existed for Tan, while a person familiar with the inner workings of the firm told Insider in an email that Initialized was in "close contact" with its limited partners on the transition.