I think many startups have their expectations set too high for the work requirements & compensation they're offering.
Many startups want Senior Engineers with several years of experience, and they want people who live in SF.
This makes it difficult for new-grads and those who don't live in the Bay Area to get into the startup scene. Many people want to work remotely or live in other startup hubs (eg. Seattle) where the cost-of-living is less expensive.
New-grads, you could argue, are the most willing, flexible, and risk-taking to work at startups since the lure is more about experience than $ compensation. However, most startups ignore new-grads because they don't have the processes/ability to mentor them (even if the candidate could already be qualified for the position).
There is room here for:
1. A company which offers services for helping startups foster remote teams
2. A company which offers services for helping startups mentor new-grads
3. A YC apprenticeship program that takes new-grads and places them in a YC startup w/ a mentor (who may or may not be at that company) for a few months to see if there's a match and hopefully transitions that person into a full-time role there
4. YC satellites in other cities or encouragement for some YC companies to relocate out of the Bay Area