> In reality they "graduate" 500-1000 startups every year.

I think people think otherwise because they used to be more selective, and haven't noticed just how much their volume has grown over the years. Early on it was a few dozen startups per year, then a hundred or so, and eventually the current state of greenlighting almost two startups every day on average (we're 275 days into the year and YC has racked up 509 companies in this years batches so far). They're less of a startup accelerator and more of a startup shotgun at this point.