We've had problems in the past, but only twice that I know of. We have now funded more than 700 companies, so that seems remarkably low.
A lot of these really fall into "fiduciary responsibility", but a more 20-year-old accessible statement of that would be ideal.
Paraphrasing something I heard from a (somewhat retired) CEO is that beyond a certain size, you're going to end up with problem employees in some proportion to the world at large. i.e the one with a possible alcohol problem, the one who is abusive, the one with odd compulsive behaviours and all manner of other predilections you were unprepared for. The first time you have to deal with this is a bit of a shock but you eventually realise that it's just reflection of humanity at large.
Possibly more than just two, but kudos for establishing these anyway. And yes, it is remarkably low.
As a former Green Dot VP, you're no doubt familiar with the money transmission legal problem (http://www.regulations.gov/contentStreamer?objectId=09000064...). Do you think it is ethical for Y Combinator, its portfolio companies, or its founders to violate state and federal laws simply because they're poorly enforced? Is it ethical for those companies to quietly hire, as contractors or employees, former regulators to "guide" them through the regulatory process? What about overseas tax havens? Does Y Combinator have a policy on the ethics of that issue?
Also, there were more than two Y Combinator portfolio companies named as defendants in the federal lawsuit over money transmission (http://www.plainsite.org/dockets/t6maunfo/california-norther...), so how are you defining "problems?" Are federal lawsuits alleging unlawful and immoral wrongdoing not "problematic?"
What about shell corporations? Does Y Combinator have any connection to Payments Sub, Inc., the company that Airbnb's CFO formed after being sued to obtain a money transmission license in California?
Regardless, wouldn't the most ethical thing to do in the face of a confusing legal situation involve public lobbying for reform of the laws at issue, rather than exploitation of the chaos? Why has Y Combinator consistently opted for the latter, rather than the former?
Aaron
"Also, there were more than two Y Combinator portfolio companies named as defendants in my federal lawsuit over money transmission"
What's the ethical problem here exactly? I linked to the lawsuit docket, it's clear that my company filed it, and it doesn't matter either way in the context of my argument.
Furthermore, had I written "my" as you suggest, it would make it sound like there is a potential ethical problem because I say so. But my point isn't that there is a potential ethical problem because I say so. My point is that there is a potential ethical problem when lawsuits in general start getting filed.
Aaron
True, the lawsuit exists, and anyone can be named. But this particular lawsuit is backed up with a few hundred pages of evidence. Feel free to read it--that's why I linked to the docket, so that anyone can. No circular logic involved.
Again, my point is that lawsuits are signaling mechanisms for ethical problems.
It is false and tendentious to claim that "lawsuits are signaling mechanisms for ethical problems" -- the law nowadays is sadly well-divorced from ethics. Just look at some of Hollywood's inane copyright lawsuits with Silicon Valley companies as defendants. Or the rise in software "patent" suits. Or Harvey Silverglate's book Three Felonies a Day. Etc.
It would probably be true to say that lawsuits are signaling mechanisms for business success. I once interviewed Cypress Semiconductor CEO TJ Rodgers who pointed to the list of complaint cover pages on his office wall. There were dozens. He said something to the effect of: Whenever we get sued, that means that our competitors are unable to win in the marketplace. Bring it on!
If I'm not mistaken Aaron/thinkcomp is suing just about everyone who could possibly be a defendant including Andreessen Horowitz, Coinbase, DST Global, Dwolla, Kleiner Perkins, Slide co-founder Max Levchin, Reddit CEO Yishan Wong, Sequoia Capital, Square, and Y Combinator. (If YC principals don't reply in this thread, it's probably because of litigation.)
A uninvolved attorney, commenting on this case, wrote: "Unfortunately for Aaron Greenspan, he has sued enough people to seem litigious at best—his own word choice—and a little crazy at worst (that last word choice is mine)." http://blog.upcounsel.com/aaron-greenspan-versus-silicon-val... While I'm expressing no opinion about the merits of this suit, I do wish Aaron/thinkcomp would do less lawyering and more, actual, you know, engineering.
(Since 2011, I've built PlainSite from scratch, building on Aaron Swartz's PACER data. But I'd rather be working on payments.)
Also, I'd expect a reporter as experienced as yourself to read the complaint and evaluate the evidence on its own merits. There was a long list of defendants in the recent litigation involving Google and Apple and Intuit and eBay, because--guess what--they all broke the law.
I stand by my point that lawsuits are signaling mechanisms for potential ethical problems. Not all of them are legit. Sometimes they're just crazy. But by and large, they point to problems that need resolution.
Also, if you want to selectively quote things from articles, here's what Felix Salmon at Reuters has to say about T.J. Rodgers: "Chrystia Freeland has found a classic example of Silicon Valley hubris in TJ Rodgers."
http://blogs.reuters.com/felix-salmon/2012/06/01/silicon-val...
Regarding my legal battle with California, the Upcounsel article also said, "He may be right, and it seems obvious that California’s MTA is much tougher than comparable laws in other states," as well as "his complaint raises some valid points."
In the unfair competition case, after trying and failing to get rid of the case via bogus sanctions, Y Combinator and the other defendants manufactured standing issues to get it thrown out by arguing that one cannot be the victim of "unfair competition" if one is not legally permitted to compete (even when the other parties are "competing" by breaking a law). This leads to the perverse conclusion that § 17200 encourages illegal activity.
Most legal gadflies are not cited by opposing counsel in formal filings before state agencies, invited to submit testimony to Congress, consulted by the GAO on what to tell Congress, cited by academics, or offered fellowships at Stanford Law School. But, you know, whatever.
Is anyone here actually willing to discuss the actual points I've raised? Just want to get that on the record.
As for "it", if "it" was not in the text of one of the comments leading up to my post, I probably did not read "it". In any event, I doubt that further knowledge of "it" would have substantially modified the nature of that assertion you made.
The actual subject matter of the lawsuit you've been referencing is only of marginal interest to me (and is irrelevant to my comment), and I didn't feel like looking through the claimed hundreds of pages of materials, or addressing the merits of a case that is already in the hands of professionals.
It might be more on track to say that criminal lawsuits indicate criminal activity, since DAs are only supposed to commence with prosecution when they believe that the law has been broken and when they can prove it. It's a safe bet that the majority of people criminally accused actually did what happened. But it violates the spirit of innocent until proven guilty, where even after an investigation the state must still convince a jury of the defendant's peers beyond a reasonable doubt.
So that's just to contrast with civil lawsuits. There is essentially no bar at all for those.
http://www.plainsite.org/dockets/28ec7xw86/arkansas-western-...
http://www.plainsite.org/dockets/28ec8i12d/new-york-eastern-...
Perhaps if you talked about anything else we wouldn't automatically think "oh, this guy again."
Is your argument really that I haven't written about enough different topics? Well, here's some for you:
- Toxic waste in Palo Alto http://www.aarongreenspan.com/writing/essay.html?id=88
- Supreme Court briefing requirements http://www.aarongreenspan.com/writing/essay.html?id=87
- Business schools http://www.aarongreenspan.com/writing/essay.html?id=58
- Airport security http://www.aarongreenspan.com/writing/essay.html?id=49
So given that I've written about a variety of issues, do you have any substantive response to any of the questions I pose above?
Combining your boorish focus with your unpleasant discourse makes me think, "oh god, he's here to beat his dead horse again."
For what it's worth, digging into someone's profile to figure out how some background detail is relevant to your dead horse is is somewhere between "unpleasant discourse" and "creepy."
I also suspect that pointing these things out to you is unlikely to yield fruit so I already know that this is my own private dead horse.
I'll update my profile regardless.
Here's what I don't understand: you're now criticizing me for referencing something you posted on a public profile. Why did you put it there if you don't want it to be seen or considered?
You're also criticizing me for raising a substantive issue especially relevant to startup founders and investors, on a forum for startup founders and investors, when you yourself are a startup founder and (it would appear from this page) investor.
If you want to plug your ears and pretend that I am just some crazy person obsessed with a pet issue that has no bearing on reality, by all means go ahead. But this is exactly the ethical debate I believe needs to be had. Because I am not just a crazy person obsessed with a pet issue. I, like you, am a rather rational person looking to turn a profit from my involvement in the technology sector. And the California legislature has now put forth not one, but two bills, to amend the law that I am most concerned with because it had a material impact on my company and many others, including some of the largest in the country (ADP, PayPal, MoneyGram, etc.). Moreover, this law affects you and potentially your investments. It certainly affects Y Combinator. And there are serious ethical issues tied up in all of this, which I will continue to haul before a judge as long as I need to.
So really, what are you getting at? You don't like me? No problem, you don't have to. But don't pretend that I'm doing something "creepy" when all that I'm doing is pointing out that laws actually matter.
The creepy refers to your mode of communication, not the message specifically. I never really get to the meat of what you are saying because I find I dislike your manner of presentation.
The message and the format are inseparable.
I think ethics are important. I don't really know much about your background. But it's disingenuous of you to claim that it's irrelevant when you're an investor with links to Walmart.
The only reason I sound like a crazy person to you is because, as you admit, you "never really get to the meat of what [I'm] saying." That's easily remedied by actually reading what's written, as opposed to just scoffing and writing me off as crazy.
As for format, I've tried just about everything there is, but I'm open to suggestions. In any event, my approach seems to be working, whether you want to admit it or not:
http://leginfo.ca.gov/cgi-bin/postquery?bill_number=ab_2209&...
The technicalities are way over my head, but even if you're right, you're unlikely to get any reply from YC since a law suit is pending...
Unsolicited advice:
From what others say in this thread, it sounds like you're obsessed with this issue. If I understand correctly, you've been wronged and filed a law suit because of it. Let your lawyers do their thing, and move on.
Your rants cause you more pain than they cause to the people you accuse.
Greenspan is acting as his own lawyer in this action (unless other counsel has been added since the initial complaint).
I never claimed that ethics weren't important. I am saying that your mode of presentation is tiresome and makes your point impenetrable.
If it were only the relevant ones then that would be one thing. But this threadjacking is getting a bit much.
Tiresome indeed.
Do you see how this works?
I don't think I even disagree with the issues you point out. It's just that I hate the way you present them.
The feeling is mutual.
If you haven't noticed, that strategy isn't working.
How am I hiding my connections?
Accusing people of felons is probably also not a good way to rally them to your cause.
Even here you are bent on turning the discussion to your cause. I'm talking about the phrasing, not the message.
It does seem creepy that you see enemies and opposition everywhere. Good luck with your cause - you need it.
FWIW my investment in Square was small and because Jack was a friend. I'm not really injured either way, though would generally like to see laws make sense in the interest of parsimony.
Also FWIW, I think plainsite is pretty good.
Wow, news.yc makes this thread really narrow. Probably punishment for belaboring the point.
The fact that I am supposedly "bent on turning the discussion to [my] cause" would actually suggest that I see potential partners everywhere, if anything.
As for phrasing, if the private and very polite conversations I've had with people had gone better, we never would have reached this point.
I retract "dead horse" and wish to replace "pet cause" - the first implies more about your cause than I really mean to.
Is that better?
Fair or unfair, that's the impression I have of your account.
https://hn.algolia.com/?q=author%3Athinkcomp#!/comment/sort_...
Wikipedia has a term that might (or might not?) apply here: "Single Purpose Account".
The general sentiment I get from the community is that if you're an expert on a particular issue, and you happen to have an unpopular viewpoint, you shouldn't participate. The community is entitled to that sentiment, and I am entitled to strongly disagree with it, which I will continue to do so long as it persists.
I wouldn't know anything about having unpopular viewpoints coupled with subject matter expertise. Maybe you're right about HN.
> The general sentiment I get from the community is that
> if you're an expert on a particular issue, and you
> happen to have an unpopular viewpoint, you shouldn't
> participate.
Forget about "facts" and "evidence": If you want to win people's support you'll have to court them like a politician courts voters. Study the techniques of some politicians who had to gain support for unpopular or controversial legislation.
Dale Carnegie is also worth a read:
http://en.wikipedia.org/wiki/How_to_Win_Friends_and_Influenc...
No, that much is clear. What is clear is that you have an axe to grind and have lost perspective as to what is and is not a proper venue for making your point (you're suing, what else do you want to do?), and that your concerns are now a matter of court review so whatever someone here has to say about it (including Sam Altman) has no importance at all.
Ethics have relatively little to do with your complaint, you contend that it should be illegal, that does not mean that it is ethical or not to engage in said practice.
Lots of things that are legal are not ethical and vice versa, but by involving the courts you have made your battleground the legal aspect, not the ethical one.
The one that does not want to hear it seems in this case is you.
All I can say is that I disagree wholeheartedly.
Also, ethics have everything to do with my complaint.
ps you might have more luck pretending that you're trying to win a popularity contest. No one likes lamers.
Ethics in business are simply informal rules.
The purpose is to fill in gaps in the laws.
(or mitigate the cost of a hyper-specific compliance regime).
Thus, legal systems underpin the context for "informal ethics" in this sense.
"Moral ethics" (so called) are a wholly distinct concept.
Of course, this is all somewhat subjective, and I acknowledge some people may dispute the idea that something can be illegal and still be ethical. But if a law is bad, I believe breaking that law can be ethical behavior. YMMV.
At an intutive level, "ethical fabric" is often/practically seen substitute for legal/regulatory infrastructure. The latter is more complex/arduous/expensive, so one advantage of developing ethical norms is increased productivy (from more focus on business, less on due dilligence/monitoring of contracts and general micro-management issues).
FWIW, with the whole money transmission thing, it does sound like you got screwed for doing the right thing. That sucks.