In an attempt to expand its horizon, seed-stage venture firm Y Combinator - which till now has been exclusively financed by founders Paul Graham, Robert Morris, Jessica Livingston and Trevor Blackwell - has recently raised nearly $2 million from Sequoia Capital and a few angel investors.

With the help of the new funding, going into the investment unit, Y Combinator will be able to fund almost 60 companies annually - with around $15,000 on an average per startup - as against the 40 companies it funds at present. The additional funding will help Y Combinator see through the next two-year period.

Other than an increase in the number of companies that can be funded as well as the funding amount - which has thus far been $5,000 chunks for six percent equity - Y Combinator would not be making any alterations in the way it operates its business.

The proposed expansion of Y Combinator is welcome news, not just for startups, but for the entire tech industry. Y Combinator has been associated with the success of companies like Google's Zenter; YouTube's Omnisio; Reddit; Xobni; Backtype; ClickPass; and Auctomatic.

In fact, Y Combinator's endorsement gives a leading edge to even idea-stage companies - along with funds and able guidance, they get a twice-a-year opportunity to pitch VCs and angel investors on 'demo days.'