In what is a rare thing for Y Combinator, today Paul Graham announced that it had admitted a nonprofit startup into its latest batch of companies in its accelerator. Watsi, a service where donors can fund medical treatments for those in need, first came to Graham’s attention through postings on YC’s Hacker News site.

Through a post on the YC site, Graham, one of the co-founders of Y Combinator, says that the group had been thinking about including nonprofits into its ranks for a while. After it met with the Watsi founders, it decided to move forward with that vision. He explains that when the company first launched, it posted about itself on Hacker News and after receiving support from HN users, it wound up raising a “significant amount of money.”

Graham says that Watsi is one of the “more revolutionary things that I’d seen the Internet used for.” He believes that technology can be used to put a face on those in need. Instead of sharing status updates, what we ate for dinner, or other cosmetic issues, the service looks at people — something Graham says technology should be focused on: “The people who need help around the world are individuals, not news photos, and when you see them as individuals it’s hard to ignore them.”

Watsi is a global funding platform, think Kickstarter for the medical and health industry, or as NBC News calls it the ‘Kickstarter for third-world medical care’. It allows anyone to connect with a person that they would like to support, enable donations as little as $5 to help fund life-changing medical treatments, and receive updates on its outcome. The company says it is a 501(c)(3) nonprofit organization and believes that health care is a “fundamental human right”.

Co-founder Chase Adam says that Watsi came about when he was in a small village in Costa Rica and a woman approached him trying to sell something in an attempt to help raise funds for a medical treatment for her son:

When she reached me, I still had no idea what she was selling. Then the man next to me asked to see the red folder she was holding.

The instant she opened the folder everything came together. There was a photograph on one side and a document on the other. The photograph showed a young boy with an incision across the width of his stomach. The document described his medical condition. The young boy was her son.

In that moment I had what can only be described as an epiphany. If I could somehow connect this woman with my friends and family back home, she would have the money to pay for her son’s medical treatment within the day.

Patients that are supported by Watsi are those that “are afflicted with an illness that meets the treatment criteria and subsequently be unable to afford the required medical treatment as a result of poverty.” Additionally, the company says that patients “must be suffering from a condition that, if left untreated, is expected to severely impact their standard of living by general consensus in the local health community.” All treatments will follow the rule of being high impact and low cost (must be under $3,000).

Graham says that “At Watsi, 100% of your donations directly fund medical treatments. Watsi.org is separately funded. They pay all their operational costs from their own funding, and none from your donations. They even eat the credit card processing fees. So when you donate to Watsi, you never have the uncomfortable feeling that lots of your money will be eaten up by administrative costs. Your money has impact you can measure.”

The service is powered entirely from volunteers. It says that “in the spirit of transparency”, it has published its transparency Google document that displays the organization’s financials.

Photo credit: Joe Raedle/Getty Images