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