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Comment by throwaway314155 | Hacker News Reader

Why shouldn't YCombinator just drop PearAI from their program? I mean they literally stole another YC startup's work wholesale and effectively defrauded YC investors. I don't know much about startup land but it seems there's an absurd amount of forgiveness given to a company that is clearly fraudulent.

Who cares whether or not they received the standard amount of due diligence/vetting? The only reason a system like that can work is if participants act in good faith, and this company obviously didn't.

edit: Like I said, I'm not exactly knowledgeable about the world of tech startups. If i've learned anything though, it's that the money being given to obvious scam artists being excused as "vetting batch investments doesn't scale" has made me even more depressed and cynical about tech startups than I previously thought was possible.

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> I mean they literally stole another YC startup's work wholesale and effectively defrauded YC investors.

Didn't YC know it was a fork of one of their existing investments? If they knew then it is bad, if they didnt know then it is bad. If they didnt know and continue to fund this startup then they are stupid.

> The only reason a system like that can work is if participants act in good faith

If you are a professional investor you need a better bullshit detector. If you fail any time someone acts in bad faith, it is not the game for you.

The investment world is full of functional sociopaths. You get used to it I guess. YC's bullshit detector would be blaring nonstop if that was enough to tank a deal.

Maybe it should?

Isn't this a thing that blew up like a week ago? After they were accepted into the program? If that's the case, what does this have to do with "vetting"?

I'm not sure I understand your confusion. Yes, any vetting that occurred would have occurred in the past. Clearly there wasn't as much vetting as some other comments i've seen might have hoped. Nevertheless, a system which requires minimal vetting (as suggested by others) only works if participants aren't literally fraudulent.

I'm just repeating myself though. That's all in my original comment.

"What do you guys do?"

"Oh... you do X? We funded a company _last year_ that also does X. How are you guys different?"

"Ok, I see, it is a fork. Very nice. Let me check what changes have you done"

I know most VCs never read commits, but they could have someone to check them for them. Maybe this is one of those changes Garry mentioned.

YC funds startups based on their teams and ideas, and in some cases, even without the latter. Building a code editor is not a requirement to get accepted.

It's very possible that Pear AI even mentioned that they're a fork in their application, just like they mentioned it on their description on GitHub; you could say that they were being dumb by generating a license with ChatGPT, but at worst that's a stupid mistake, not fraud.

Does it really matter what it is? A team that is going to use ChatGPT to generate their license is likely to do a bunch of other ill-advised stuff.

I can promise you that after all of this outrage, they're going to be much more careful about everything they do.

To respond to your question directly though, yes it does matter; any accelerator that accepts hundreds of companies every year based on a 10min interview is gonna get some bad ones, but rescinding the offer to them is just really bad form if they didn't commit actual fraud.

I don't think it's obvious that they will be careful. IMO it's rather another reinforcement for "ask for forgiveness, not for permission".

Not to mention keeping them saves a lot of face.

LOL the desire to cancel is so strong. Dude, it’s YC’s money and they’re betting where they’re betting. They’re the ones being “defrauded” if any.

> They’re the ones being “defrauded” if any.

Yeah that's what I said.

Why should they drop them, though? The damage is done, the money is spent, and they can just as well wait it out now, to see if anything comes from it anyway. In the worst case, it is a failed investment, and they will have plenty of those, and the reason doesn't actually matter, except in learning from it for the future.

There definitely are things to get depressed about, I just don't think this is one of them.

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