Has any YC founder ever gone to jail for startup-related crimes?

8 TeslaK20 3 8/1/2025, 2:40:33 AM
Forbes 30 under 30 has become infamous for it's press-to-prison pipeline.

But YC has selected literally thousands of founders, maybe tens of thousands, and I haven't heard of any of them getting arrested for fraud.

Are there any exceptions? And why is YC so good at screening out impressive-seeming but fraudulent founders?

Comments (3)

m0zzie · 16h ago
IIRC there have been a few but the only one I specifically remember is uBiome: https://en.m.wikipedia.org/wiki/UBiome

YC has yet to back a Theranos-scale fraud.. unless there is one that simply hasn't been discovered yet.

TeslaK20 · 16h ago
Oh I remember hearing about that one now! I didn't realize it was YC. That one's interesting since the founders are still fugitives.
anovikov · 14h ago
I worked for a YC founder (won't name it ofc) on a project that went through its pipeline with a big success around 10 years ago, although for me it was evident that the idea was unworkable and i wondered how could they raise funding. As it turned out, one or both of cofounders had criminal convictions before, one of them actually came up with the idea of that product while in prison, they completely faked all their user and traction numbers and siphoned money out of investors, and almost everything that was ever actually done, was done by a single developer i have supplied them. Then they were uncovered and went into hiding again (probably always used fake names so idk if it even matters - maybe they are still around us).

Ironically, the idea that was unworkable back then, appears to be still unworkable, and is still actively tried by one team i talk with! And they recently raised money from Google.