Maybe you should let us know what the startup was, as well as the people behind it, so we can avoid working with them.
So shady people or companies continue to be shady because people don't want to risk loss of potential income or reputation.
Idly allowing bad and potentially evil behavior to go unrecognized and unchallenged is by no means being a good person. Not to Godwin the thread, but your attitude is why evil flourishes, and on much grander scales than stock allocation.
Having said that, all you need is 2 minutes, google and you can easily deduce yourself what company he is referring to.