Startup-accelerator Y Combinator is joining the layoff brigade if the latest development is any indicator. On the heels of two major banking failures in the US – in the form of Silicon Valley Bank (SVB) and Signature Bank – the startup accelerator informed that it is going to bring several changes to its organization.

These changes include the culling of 20% of its total employees – which will impact around 17 of its team members, according to a blog post by Y Combinator on the matter. Furthermore, it will be writing fewer checks to companies for late-stage companies in the near future.

“YC is rightly known for early-stage investing. In recent years, we have also done some late-stage investing. But late-stage investing turned out to be so different from an early stage that we found it to be a distraction from our core mission. So, we’re going to decrease the amount of late-stage investing we do,” wrote Garry Tan, President and CEO of Y Combinator, in the official statement.

The move comes as a surprise to many, given the company’s reputation for providing unparalleled support to early-stage startups. It has also sparked concerns among entrepreneurs who depend on the company’s expertise and support to launch their businesses. For those who are unaware, Y Combinator is known for providing a wide range of resources to startups, including mentorship, networking opportunities, and access to funding. Despite the concerns, Y Combinator assured entrepreneurs that the layoffs will have a major impact on the company’s ability to support startups going forward. The startup incubator remains committed to its mission of helping early-stage startups succeed and will continue to provide high-quality resources and support. It has already supported 200 startups from India.

“There shouldn’t be any noticeable effect on the companies we’ve funded or on the way we interact with alumni, but if any companies or alumni have questions, I’m here and the YC group partners are here — as always, to help you make something people want,” Tan further wrote in the statement.

But while this comes soon after the failures of SVB and Signature Bank, Y Combinator told TechCrunch that it was not making the changes due to the banking failures – instead, it had been working on these changes “well before” the dramatic collapse. Soon after SVB had collapsed and regulators had seized control of its assets to protect the depositors, Y Combinator wrote to the US Treasury Secretary that the crisis could adversely impact over 10,000 startups, and go on to trigger nearly 1 lakh layoffs as businesses with accounts in SVB would be unable to pay their employees in the next payroll. Y Combinator informed that over 30% of its startups were exposed to SVB, and are struggling to stay afloat amidst the banking crisis.