Y Combinator picks fight with Canada, backtracks

Y Combinator briefly removed Canada from its list of acceptable countries of incorporation, prompting criticism from Canadian investors and founders. The accelerator has since reversed that decision and restored Canada to the list. The change was first noticed last week, after a site that once listed the US, Canada, Singapore, and Cayman no longer included Canada.

YC CEO Garry Tan defended the move on X, saying YC-backed Canadian startups that reincorporated in the US had twice the average valuation of those that did not. He later added, "There are lots of reasons to build great companies in Canada, and there are lots of great YC and non-YC startups that thrive and are making the Canadian tech scene great," and wrote, "Where you are incorporated increases your access to capital.

That's it." He also accused "clout farmers" of trying to "make it drama." The online backlash was swift, with some accusing the decision of political motivation.

Canada