Sam Altman, Y Combinator's president, said in a company announcement Wednesday that China had been "an important missing piece of our puzzle" when it came to sourcing new start-ups to take under its wing.
"We think that a significant percentage of the largest technology companies that are founded in the next decade — companies at the scale of Google, Microsoft, Apple, Amazon, and Facebook — will be based in the U.S. and China," Altman said.
"YC's greatest strength is our founder community and with the launch of YC China we believe we have a special opportunity to include many more Chinese founders in our global community."
The accelerator, set up in 2005, has invested in more than 1,900 start-ups, including notable firms like Dropbox, Airbnb, Reddit, Stripe and Coinbase.
Y Combinator's entry into China will mark the latest push by U.S. companies and investors to invest in the country's fledgling tech scene, which has given rise to multi-billion dollar start-ups like ride-sharing firm Didi Chuxing, drone maker DJI, Meituan-Dianping-owned bike sharing company Mobike and AI and face recognition firm SenseTime.
As part of the move to China, Lu will also head up Y Combinator's research team, Altman said. The accelerator also plans to launch a new research center in Seattle.
Before his time working with Baidu, known for its popular Chinese search engine, Lu served as an executive vice president at Microsoft, leading the division in charge of Office, Bing and Skype. Lu quit Baidu in May for "personal and family reasons," and said he wished to spend more time in the U.S.