Enterprise capital is crammed with traders who declare they’ve obtained inside entry to the subsequent massive factor. In the meantime, Gabriel Jarrosson, a French engineer-turned-YouTuber-turned-investor, has constructed his VC agency round a single filter: if it isn’t a Y Combinator firm, he gained’t put money into it.

That self-discipline pushed Jarrosson from filming scrappy enterprise explainers in Paris to managing greater than $12 million in property at Lobster Capital, with a bigger second fund already within the works, in line with latest SEC filings. His logic is easy: He believes YC’s observe file of manufacturing billion-dollar firms beats chasing startups elsewhere.

In 2017, pissed off by the dearth of entry to promising French startups, Jarrosson launched a YouTube channel to share his funding journey in French.

The channel grew a loyal following, developed into one in every of Europe’s largest angel syndicates, and since 2020 has deployed $36 million into startups, largely YC alumni. That observe file paved the way in which for Lobster Capital, which closed its debut fund at $12 million, surpassing its $8 million goal.

Jarrosson’s reasoning on backing solely YC startups rests on likelihood. In line with this report, roughly 4.5% of YC firms turn out to be unicorns (in distinction to the two.5% consequence for different venture-backed seed-stage startups), and round 45% of firms go on to lift a Sequence A (increased than the 33% common). 

Equally, YC has funded greater than 90 unicorns, with roughly 1 / 4 of these rising into decacorns.

That’s why the premium for YC offers, the place valuations usually run multiples increased than non-YC friends on the seed stage, doesn’t deter Jarrosson.

“If you concentrate on the VC math and the returns, these outcomes are clearly nice to your portfolio. As traders, you must ask your self, can this firm turn out to be the subsequent unicorn?” mentioned the founder and managing accomplice in an interview with TechCrunch.

“If the reply is sure, it’s usually okay to speculate even at a barely increased valuation. Possibly it’s a $20 million seed or $30 million, and even $40 million. Some will cross and that’s effective. However I select to speculate.”

Using the AI wave and content material as a moat

Lobster Capital, like most early-stage traders, has ridden the surge of AI-first startups dominating latest YC batches. Jarrosson factors out that three cohorts in a row have shattered income progress information inside the accelerator, with firms reaching thousands and thousands in ARR inside months.

There are stories that a few of that ARR traction globally seems fragile, inflated by pilots or churn-heavy annual contracts. Whereas Jarrosson admits the danger, he insists that early income stays the toughest hurdle, and for many of those startups, retention will be mounted.

However extra broadly, the largest query round Jarrosson’s thesis is entry, as YC demo days draw a whole lot of funds chasing the identical firms.

Jarrosson credit his edge to repute inside YC’s community, visibility from his content material, and his personal founder background. YC founders fee traders on Bookface, the accelerator’s inner platform, and Jarrosson claims robust evaluations assist him land allocations.

Equally, his podcast that includes YC founders and 40,000+ LinkedIn followers, the place he shares his funding journey and nuggets on something YC, additionally serves as ongoing advertising and marketing.

“I attempt to do nicely by founders. Individuals additionally hear in regards to the agency from social media, and as a former founder, they know I will help them as a result of many funds are constructed by individuals who haven’t been operators earlier than,” mentioned Jarrosson, who previously launched a number of startups and had some exits in line with his LinkedIn profile.

Jarrosson is a part of a rising checklist of traders constructing funds on the again of non-public manufacturers. He cites Harry Stebbings, the 20VC podcaster who raised a $400 million fund this 12 months, and Garry Tan, who co-founded Initialized Capital and grew it to $3 billion in AUM earlier than changing into YC’s CEO, as inspirations.

Like each traders, Jarrosson treats social media, YouTube, and podcasting as neighborhood instruments and deal engines. That content material technique additionally helps pull in restricted companions who usually uncover him by way of movies or podcasts earlier than seeing a fund deck, he provides.

The managing accomplice has made greater than 100 investments by way of his syndicate and Lobster Capital’s first fund, launched in 2023, which has backed almost 30 startups in B2B SaaS, fintech infrastructure, and AI instruments.

He counts two unicorns and a number of other “soonicorns” throughout the syndicate and the fund, together with Jeeves, Baubap, Flutterflow, Metriport, Alinea, and Jiga.

“YC has the observe file. It’s been round for greater than 20 years now. We all know it backs the very best founders and creates the very best founders,” Jarrosson mentioned. “Arguably, the outcomes of YC sooner or later are in all probability going to be even higher. However even when they keep what they’re, we all know it’s an excellent wager.”

Investing solely in YC-backed firms isn’t a completely new idea. Different VC companies, together with Initialized, Pioneer Fund, Phosphor Capital and Insurgent Fund, additionally began with the identical technique.