Synopsis
OpenAI is providing two million dollars worth of tokens to each startup in the current Y Combinator batch. This initiative aims to accelerate product development and internal workflows. Startups will exchange equity for these tokens. This move is expected to unlock significant innovation from driven founders.Listen to this article in summarized format
“I am excited to see what will happen with tokenmaxxing startups, both for how they work internally and the products they can build. OpenAI offered to invest $2M in tokens into every startup in the current yc batch,” Altman wrote in a post on X.
What is tokenmaxxing?
Altman described the initiative as a push toward tokenmaxxing, a growing tech industry trend where startups and engineers maximise the use of AI models and credits to speed up product development and internal workflows. Tokens are the basic units of text that large language models (LLMs), including OpenAI’s GPT models, process and generate. Per OpenAI, in English, one token is roughly equal to four characters or about three-fourths of a word.
According to a report by The Information, startups could gain access to nearly one trillion GPT-5 tokens under the deal, though actual usage costs vary depending on the model and the extent of cached or repeated inputs.
Categories include input tokens (text sent to the model), output tokens (text generated by the model), cached tokens (reused conversation history), and reasoning tokens, which some advanced models use internally while thinking through a response before producing the final answer.
What will startups give up in exchange for tokens?
YC general partner Tyler Bosmeny said startups will exchange equity for OpenAI tokens. According to The Information, these tokens will be offered through a SAFE (Simple Agreement for Future Equity) agreement, under which OpenAI’s ownership stake will be determined in a future funding round.
“@sama just offered $2M in OpenAI tokens to EVERY YC startup in the current batch in exchange for equity. Just like [angel investor] Yuri Milner offering to invest in every startup back when Sam was a YC partner. I can't wait to see what's unlocked when you let the most driven, creative and formidable founders tokenmaxx,” Bosmeny wrote in a post on X.
In 2011, Milner and SV Angel offered $150,000 in convertible loans to the then YC cohort of 40 startups.
The initiative is expected to cover hundreds of YC startups in its spring and summer cohorts. The startup accelerator is currently running its Spring 2026 batch between April and June, which, per its website, includes nearly 168 startups, of which around 40 have publicly launched. At the same time, the accelerator is accepting applications for its Summer 2026 funding cycle, with the programme scheduled to run from July to September in San Francisco.
While the current Spring 2026 YC cohort does not include any Indian startups, during its first visit to India, the startup accelerator distributed free API tokens, compute power, and developer tool credits worth about $25,000 (roughly Rs 21 lakh) to 2,000 selected participants. However, ET reported on Wednesday that several participants who had little immediate use for the credits reportedly began selling them at discounts of 20-40%, creating a grey market for AI credits. Some attendees also said certain credits came with restrictions or did not function as expected, prompting them to sell.
