For years, Y Combinator has been the gold standard for accelerating early-stage startups. The numbers speak for themselves: 6% of YC companies become unicorns, and a quarter of those reach decacorn status. Yet, despite this impressive track record, the pathway from promising YC demo day to a global scale remains fraught with risk and uncertainty. Founders often struggle to find investors who not only understand the unique YC journey but can also provide the right kind of support — capital that comes with empathy, operational know-how, and a deep network within the YC community.
Meet Kulveer Taggar, a two-time YC alum whose journey through the accelerator has come full circle. Taggar’s story with YC began in 2007, when he, his cousin Harj Taggar, and future Stripe founders Patrick and John Collison brought their startup, Auctomatic, through the program. That company was acquired just a year later, but the experience forged a lasting bond with YC. He returned in 2011 with Zeus Living, a property management startup that raised over $150 million and, at its peak, was valued at more than $200 million, with an annual revenue run rate of about $120 million. Zeus, however, faced significant challenges when interest rates surged earlier this decade, and it was eventually acquired by its competitor, Blueground, in late 2023.
It was in the wake of Zeus Living’s sale that Taggar saw an opportunity. Drawing on his hard-won experience and deep ties to YC, he launched Phosphor Capital — a venture fund dedicated solely to investing in YC startups. Since its inception in 2024, Phosphor has raised $34 million across two funds, with backing from high-profile investors, including YC CEO Garry Tan, investors in Zeus Living, family offices, and a major asset manager. Taggar’s pitch was simple yet compelling: invest in the next generation of YC companies, guided by someone who has lived every step of the founder’s journey.
Founder’s background, mission, and motivation
Taggar’s credentials as a YC “OG” are hard to match. Not only has he built and exited two YC startups, but he’s also maintained close relationships with the accelerator’s leadership, including Garry Tan, who led Zeus Living’s Series A and joined its board. YC partner Jared Friedman describes Taggar as “close to me and to many of the folks who now run YC,” highlighting the trust and credibility he brings to the table.
The mission behind Phosphor Capital is clear: to help YC founders sustain their brilliance over the decade it takes to build something great. Taggar’s own experience navigating the highs and lows of startup life, what Friedman calls “a tremendous number of battle scars,” gives him a unique empathy for new founders.
“I hear this from founders that he has incredible empathy for what they are going through because he went through it all himself,” Friedman notes. For Taggar, Phosphor is a way to channel his experience into an unfair advantage for the next wave of YC founders.
The Phosphor edge: technology, USPs, and differentiation
While Phosphor Capital is not a technology company per se, its investment thesis is rooted in backing the most innovative startups emerging from YC, with a particular excitement for young AI companies. The fund’s approach is both data-driven and deeply networked, leveraging Taggar’s personal relationships and insider knowledge to identify and support the top 15-20% of each YC batch.
What sets Phosphor apart is its founder-led, founder-focused model. As a solo general partner, Taggar offers a level of agility and personal attention that larger, committee-driven funds can’t match. His deep integration with the YC ecosystem, spanning nearly two decades, provides unparalleled access to deal flow and insights.
In just over a year, Phosphor has written checks ranging from $100,000 to $500,000 to more than 200 YC companies, including workflow automation platform Gumloop and AI meeting manager Circleback, both of which have already gone on to raise Series A funding.
Phosphor isn’t the only fund focused on YC startups; Pioneer Fund and Rebel Fund employ similar strategies. However, it is the only dedicated YC fund led by a solo GP with such a long-standing relationship with the accelerator and its leadership. This unique positioning has made it easier for Taggar to raise capital, with many LPs citing his track record and work ethic as key reasons for their support.
What’s next for Phosphor Capital?
Phosphor Capital’s ambitions are as bold as its founder’s vision. The fund will continue to focus exclusively on YC startups, aiming to back the next generation of unicorns and decacorns, particularly in high-growth sectors such as AI. With over 225 portfolio companies already and a combined $720 million raised by those startups, Phosphor is rapidly scaling its impact within the YC community.
Taggar is committed to providing more than just capital. He sees Phosphor as a long-term partner for founders, offering hands-on guidance, help with key hires, and support through the inevitable ups and downs of scaling a company. “You could view this as a bet on Garry,” Taggar says, referring to Garry Tan’s leadership of YC. “I think he is taking Y Combinator to new levels.”
Phosphor Capital embodies the YC ethos, led by someone who has lived and breathed the founder’s journey. With $34 million raised, the backing of Garry Tan, and a rapidly growing portfolio, Taggar is betting big on the continued success of YC and its founders. In doing so, he’s building a fund that’s not just about returns but about sustaining brilliance and supporting the next wave of world-changing companies.
