Y Combinator's standard deal is two SAFEs, not one number

The record

Y Combinator's own Deal page, as retrieved on 16 September 2026, states that the accelerator invests a total of $500,000 in each company it accepts, a figure the page repeats and that Y Combinator's FAQ page confirms directly: 'We invest $500,000 in each company.' The Deal page breaks that total into two separate instruments rather than one round: '$125,000 on a post-money SAFE in return for 7% of your company,' plus '$375,000 on an uncapped SAFE with a Most Favored Nation (MFN) provision.' The page also states Y Combinator receives a right to continue investing in later financing rounds, and that 'we don't charge any fees to the companies to be part of YC.'

What the documents establish

The two tranches behave differently, and Y Combinator's own SAFE User Guide explains the mechanism behind the second one: an uncapped MFN SAFE carries no valuation cap or discount of its own, and instead lets the holder later adopt the terms of a more favorable SAFE the company subsequently issues, an amendment the guide says typically triggers only once. Until then, the guide states that if a priced round happens first, the MFN SAFE simply converts on the same price and share class as the new investors. The Deal page's own worked example shows the $375,000 tranche converting at '$375,000 / $15,000,000 = 2.5%' under an illustrative $15 million cap, a hypothetical the page itself supplies rather than a guaranteed outcome. The FAQ page does not state an equity percentage at all, only the dollar figure, which is why the Deal page is the more complete of the two for terms rather than amount alone.

The operating read

A founder reading '$500,000 for 7%' as a single clean number is reading past what the page itself says. Editorially, the more accurate way to model dilution from this deal is as a fixed 7% slice from the capped tranche plus a variable, currently-undetermined slice from the uncapped MFN tranche that depends entirely on what cap or discount a later SAFE round sets. Because the second tranche has no cap of its own, its eventual size cannot be fixed at acceptance; it should be modeled as a range tied to the company's own future fundraising terms, not treated as already known.

What to check before you decide

Before treating the published figure as the final word on dilution, check the following against the company's own documents.

• Has Y Combinator's page changed the $500,000 figure or the 7%/$375,000 split since this description was retrieved on 16 September 2026?
• What valuation cap or discount will the next priced round or SAFE actually set, since that determines what the uncapped MFN tranche converts into?
• Does the cap table model both tranches separately, rather than collapsing them into one blended percentage?

This is an editorial reading of a published, changeable page, not a projection of any specific company's outcome; a founder should confirm current terms directly with Y Combinator before relying on them.