The list of companies that have gone through the Y Combinator accelerator program reads like a who’s who of 2010s Silicon Valley.
From Stripe, to Airbnb, to Dropbox, Instacart and Coinbase, some of the most successful organizations in tech can trace their roots back to the popular (but ultra exclusive) seed funding program. To date, Y Combinator has invested in more than 2,000 companies since 2005 with a cumulative valuation of more than $155 billion.
In exchange for a small investment stake, the program helps participants hone their ideas, work on product-market fit, develop a roadmap to scale and make introductions to future investors and potential acquirers. It all culminates at Demo Day, where all of the startups in the cohort present their businesses to a room full of tech industry insiders and journalists.
Y Combinator Demo Day is a big deal in the Bay Area.
So big, in fact, that this year it stretched over two days – August 24 & 25 – with online presentations streamed out to an audience of more than 1,000 people.
All of this is to set up how impactful it is that not one, but two psychedelic companies – Osmind and Gilgamesh — were part of this year’s Y Combinator class and presented at Demo Day 2020.
Let’s start with Osmind, which Techcrunch profiled this week:
“Osmind’s founders say the goal for their young startup is to help patients access innovative treatments to mental health by providing clinicians and pharmaceutical companies with software and services that will make the provision of care, and proof of the efficacy of treatment, more readily available.
“There are 11 million Americans that are resistant to most mental health therapies, according to Huang and Qian. Those patients can cost the healthcare as much as $250 billion, they said. “Nobody has been able to help this patient population,” said Huang in an interview. “Pharma doesn’t develop drugs for them.”
“Now graduating with Y Combinator’s latest cohort of companies, Osmind’s public benefit corporation intends to aggregate data from the sickest patient population and provide that data to drug developers for clinical trials and to help insurers route patients to the treatment providers that can benefit them the most, according to Qian.
“The company, which launched its services two months ago, already has 30 practices using its software covering 3,000 patients.”
The company is building software for mental health providers and their patients, leveraging data insights to “improve clinical care while advancing research towards new treatments and precision health.” A Public Benefit Corporation, Osmind’s business model is three-pronged: The previously mentioned provider software, a research platform for those developing new psychedelic treatments, and an online community for patients dealing with treatment-resistant mental health conditions.
Gilgamesh, on the other hand, is still in stealth mode and looking to raise money once Y Combinator is over, but its web site offers a brief overview of its market. The company is developing “novel psychotropic drugs for the treatment of neuropsychiatric conditions including depression, anxiety, substance use, and stress-related disorders.” It describes itself as “a platform company developing an oral arylcyclohexylamine & the next generation of psychedelic-related medicines with novel benefits, improved safety profiles, and strong IP.”
Psychedelic Invest reached out to executives from both companies but had not received responses as of publication.
Still, the fact that psychedelics were included in this Y Combinator cohort at all speaks to the enormous potential of the industry as a whole. Y Combinator itself is famously hard to get into – accepting barely 1.5% of applicants, compared to Harvard’s 5.9% acceptance rate – and is driven by a motto focused on “making things people want.”
When experienced Silicon Valley VCs who have invested in 2,000+ high growth companies over the years — including more than a dozen unicorns – look at your market and see potential there for two different companies… it’s a good sign for everyone in the psychedelics space. Osmind and Gilgamesh likely won’t be the last two industry companies to pique Y Combinator’s interest.