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YC’s demo day and SXSW make plans to go online, testing the value of a handshake

Y Combinator’s annual demo day will take place online and the City of Austin has canceled South by Southwest, as concerns over the spread of coronavirus upend two of Silicon Valley’s marquee events.

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Two of the most influential gatherings for tech startups—Y Combinator‘s annual demo day and South by Southwest—are arranging virtual experiences rather than live sessions, as concerns over the spread of coronavirus upend the tech industry.

The decisions are effectively impromptu experiments that will test whether closely watched events that draw a who’s who of the venture capital industry can function without face-to-face interaction.

Under YC’s new arrangement, founders will record their presentations in advance and investors will watch them on YC’s website, instead of taking to a San Francisco stage as originally planned. The virtual attendees will also be able to swap their contact information for setting up in-person meetings, and founders will be able to distribute other materials such as pitch decks.

“While we won’t be able to recreate every aspect of Demo Day, we’ll try our best to create an amazing experience for our founders and investors,” YC said in a blog post. The event, now in its 15th year, is scheduled for March 23 and has been shortened from two days to one.

SXSW was officially canceled by Austin city officials, but the event’s organizers said they’re “working to provide a virtual SXSW online experience as soon as possible for 2020 participants.” The tech, media and music conference held annually since 1987 was to take place March 13-22.

In addition to its many cultural events, SXSW offers a startup track with dozens of events, including a pitch competition featuring 50 tech startups.

Inside the startup ecosystem, demo day is a keystone event for investors and founders to connect. In the past, Silicon Valley-based YC and other conference organizers have offered online elements such as live-streamed presentations or apps to help attendees connect with each other.

But an online-only format eliminates a hallmark feature of conferences: the chance encounters when participants strike up conversations on the fly.

“With high quality, curated events such as YC demo day, serendipity is a large part of the value of the in-person event,” Avichal Garg, managing partner of Electric Capital, said in an email.

Through the YC website, investors will be allowed to stream presentations and sort companies by industries and geography. The event typically attracts more than 1,000 investors, and there are over 200 startups in the current session’s cohort.

VC investors also frequently stress the importance of finding standout founders, not just promising ideas. Moving online means less opportunity to get a sense of a founder’s personality and vision. Seed-stage startups may find it easier to land funding through online methods than those seeking larger checks, Garg said.

The decisions to go digital follow similar moves by other tech conferences including 500 Startups’ demo day, which will feature live presentations rather than pre-recorded ones. SaaStr, a software-focused conference for this coming week, has been postponed until September.

For now at least, YC hasn’t made plans to host future demo days online, but a company spokesperson said, “We don’t know what the future holds for COVID-19 and will plan accordingly.” SXSW officials didn’t respond to a request for comment.

In recent days, the tech industry has seen the coronavirus strike home, with employees at Amazon, Facebook and Microsoft in Seattle testing positive.

Photo of Summer 2019 demo day courtesy of Y Combinator

  • james-thorne.jpg
    Written by James Thorne
    James Thorne is a Seattle-based managing editor overseeing PitchBook’s venture capital coverage and data journalism initiatives. He previously reported for GeekWire, Reuters, CNBC and Source Media. A native of Colorado, James graduated from Boston College and received his master’s degree in business journalism from New York University.
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