The original opening statement went "Fuck Monsanto, and by association, fuck Cloudant". This an emotional statement, a matter of moral outrage. What is the outrage directed toward? Well, to Monsanto and companies that deal with them? Nope. Because if that were the true outrage should be proportional to how much a company benefits Monsanto. In the big scheme of things Cloudant is not going to make that big a difference, moral outrage should instead be directed to the companies and institutions that Monsanto depends on. But those companies don't advertise their dealings with Monsanto, for reasons that should be obvious by now.
But wait a second... what is Cloudant guilty of? Poor PR judgement. Nothing more. Does that justify moral outrage? I don't think so. Moral outrage is a useful emotion, but it should always be followed up by some rational analysis. The cause of the outrage is the PR statement, not the fact that Cloudant and Monsanto are in business together.
pg hinted also hinted at this by saying that Cloudant is held to a different standard than all the other companies that deal with Monsanto. Nick O'Neill argues that pg therefore supports the PR statement and that this all reflects badly on YC and the moral fiber of the YC people. That's just taking it all way out of proportion.
I probably would have taken the moral high ground and refused to do business with Monsanto. But always taking the moral high ground is a huge handicap. If you want to have a shot at building a billion dollar company you can't afford to play with too large a handicap. The game is difficult enough as is. And if you succeed the world is going to much better off because of your business.
We read today that Jeff Bezos is a tyrant and micro-manager. So was Steve Jobs. Books have been written about the ruthlessness of Bill Gates. Larry Elison? Check. Even Richard Branson (who is a stand-up guy) committed $100k of tax fraud when he was young. Alan Sugar? Ruthless. Would we be better off without these guys? Hell no. Should we shun and shame them? Again, nope. It's better to take 10 steps forward and a half step back than to refuse to move at all.