Hi there, a YC company 'pivoted' into copying our product completely, even the API calls. I discovered that, noticing their employees in our Slack Community channel. As a female founder, having my app rejected by YC with this product, it just makes me angry. What can we do, apart from, of course continuing on our mission??
Stop talking about it and call a law firm. Your local Bar Association will be able to give you a list of firms/attorneys that practice in this area, or your existing lawyer may have a recommendation. Many law firms will give you a short consultation for free. Bring a succinct written summary of the facts with you that briefly describes the product, how you discovered the issue, and what you found when you investigated, with dates. Include a list of evidence items you have already collected. Litigation is difficult and expensive, but if you have a strong case (and it sounds like you do) then the law firm may take it on contingency in return for a larger portion of the settlement/judgment.
EDIT: I wouldn't trust the opinions of the 'just execute better' posters here, considering your competitors' employees already infiltrated your slack channel.
Of course it isn't horrible advice, legal affairs are dealt with by lawyers and courts. If you have a product out there in the market you should go to bat for it.
And yes, it might make your company fail. But that goes for a well funded competitor outright copying your product as well.
The trick is getting an objective assessment of how strong the case is, the risks, opportunity cost, etc. There are a lot of lawyers who are perfectly happy to tilt at windmills for $500 an hour until you run out of money.
Legal action is fine as long as you have the time and money to do it
For the looks of it, in this case they should either not do it at all or just wait until they have enough money to do it
Even large companies wait for the right timing to sue
I know a company that had copied some images from Instacart. Instacart knew about it, but they waited until Uber acquired the company, then they sued Uber
Legal action is incredibly expensive and time consuming, especially in the US
What are the indicators you're seeing in this story that legal fees would have a real ROI? I think it's good to be skeptical of paying elective legal fees.
Not it won't. If it is an outright copy (that's relatively easy to prove) you can have an injunction issued, besides that the bad press alone might get them to back off. I've brought a lawsuit like that and won << $100K.
A few hundred in total. What helped is that they actually did copy text verbatim, so it was very easy to prove. Their defense: they stole it but not from us... go figure. Needless to say that didn't land very well with the judge.
If you go this route be sure to grab evidence now. Screenshots, logs and anything you can to show the product similarities and IP issues. Before they change stuff and try to erase it.
Good luck with this. It must be very frustrating to see this happening. Make sure you cross your 't's and dot your 'i's before going to court on this and offer them to settle first assuming you have hard proof that they copied your work product.
Document everything.
They item would be whether or not YC is aware of this and whether or not your application or parts thereof somehow made it to these people. If it did you have a much stronger case, if it did not then you need to document very carefully which bits you believe have been copied, timestamp the works and make sure your lawyer gives you a fair assessment of what to expect in terms of costs and what your claim will be.
I can't look into your walled but depending on how much backing you've got you may be able to hit the pretty hard or you may have to walk away from it, even if you have proof, hard to tell.
Pretty wild how much "just execute better" posts there are, one wonders if its the common response to a situation like this, from this community, and what that says about trustworthiness in general of YC "founder" types!
The alternative would pretty much be an end to startup innovation, since a large company with a team of lawyers could just claim that any new product that threatens them is a copy in some way and destroy the startup with legal bills regardless of whether there's any merit to the claims.
Being copied sucks, and I agree that it should be looked down upon culturally, but I think "just execute better" really is the right answer. It's better for consumers and ultimately better for entrepreneurs too.
I've had something like this happen with a bunch of guys cloning my software and changing the URL to offer a competing service.
I've also had a funded competitor copy our business model and attempt to compete.
I sued the first one, the other one we outcompeted in spite of a 30:1 funding discrepancy. Regardless, these things are distractions and some funded bunch of cowboys destroying the market for you when you've spent a long time to get established can be a real problem. Even if they go under they'll do a lot of damage, not just to you, but also to their customers and possibly the whole field as a consequence of their activities. For instance: to offer the product for free because they're burning investor cash.
I hear you, but what's the alternative? Are you advocating for software patents?
If you're just saying that an API or a website is copyrighted and can't be ripped off verbatim, that sounds more reasonable to me. But still, it's trivial to copy but then make minor cosmetic changes (especially with AI). Then we're back to a very troublesome gray area.
It all depends on what has been copied. If privileged info from the YC application was used they should be sued into the ground for that but I can't imagine that YC would ever let that happen. If they copied code, text or images from the product or webpages they should be slammed for that too. But if they just decided to clone the concept and did all the legwork themselves that would be a different matter.
The fact that they infiltrated the OPs comms channels certainly doesn't make them look good.
YC isn't responsible for the actions of the founders of every start-up that they fund. Even worse: after funding them they have very limited ability to influence the companies they funded, after all, YC has a small minority stake and founders could just ignore them. Obviously YC can cut them off from further capital and blackball them but that may not be sufficient.
on the contrary! They are indeed very much responsible, if only in part, for the actions of the people they are giving money and sharing connections with! Pretty sure there's an entire corner of criminal law and civil code covering exactly those responsibilities! And yeah, they can do all kinds of stuff to make sure that these things don't happen, or at the very very least publicly demonstrate that they will not tolerate it from future "founders" by responding appropriately to this one. I am always freshly amazed, probably from naivete, each time people make excuses for the terrible behavior of SV tech "founders" and the VCs that prop them up. I shouldn't be, on this forum, and thats on me.
As a seed investor and VC investor I'm happy to inform you that it very rarely happens that seed investors or VCs have a controlling interest in the company.
You may have a board seat. And if you don't like what the company is doing your most powerful move is resign from the board. Another option is to force a shareholder vote, but if the founders still hold the majority (as they should, at this phase) that will be overruled.
I'm freshly amazed by the lack of basic corporate law knowledge in the context of HN, this is really something that should be known if you partake of conversations like these.
I agree they should respond appropriately, but depending on what happened that response may not satisfy you.
I don't care whether you invest, nor do I care about corporate law. Nor, really, is corporate law at the heart of this matter! But, hey, if it shuts down opposition on forum arguments I'm sure thats an easy card to try and pull out. So let me be crystal clear, no one needs to know corporate law to comment on whether or not a YC funded startup is ripping off another startup, a startup that had previously applied to YC and was turned down! The idea that YC is in some way not responsible for the companies which would not even exist if not for the money and connections provided by YC is dishonest in the extreme. You should be embarrassed but I know you won't. In half an hour or less this comment will likely be flagged out of existence and no one will the wiser.
> considering your competitors' employees already infiltrated your slack channel.
It was a public community slack channel. There may have been proprietary/protected information shared in there but in my naive opinion (NAL!) that wouldn't be protected by trade secrets if it was shared publicly. Some things could still be protected by copyright or trademark but it's pretty unlikely. It's possible copying the API could be infringing but Google v. Oracle[0] makes that a very uphill battle.
"Secret sauce" is highly valued by founders and product managers but IMHO it's generally overvalued and doesn't constitute a moat. For the most part, competitors are allowed to copy most things and leverage whatever other advantages they have over the original innovators.
Litigation is about more than the legal argument alone, and the legal arguments often turn on specific facts that may seem general on casual inspection. Other factors to consider include cost, embarrassing facts that may emerge during discovery, and reputational damage. That's why cases are often settled on the eve of trial, sometimes for significant sums.
Getting a professional opinion on the options is generally better than just making assumptions. Copycats and rip-offs are a fact of life, but that doesn't mean they should enjoy free reign. It's not that I think litigation is better than execution, but people exclusively advocating the latter are expressing an opinion about how they think things should work in a perfect world while not having any assets of their own on the line.
I'm inclined to be sympathetic to the OP, but looking at both products side-by-side, including their API docs, they just seem like two similar but not identical products in the promotions space.
The APIs look fairly different to me from a brief look through the docs. Apart from both using some resource names like 'Campaigns' and 'Customers' that you'd expect any platform in this space to use, most of the actual endpoints seem to be quite different.
Same with the overall set of features. There are some features in common, but also features on both sides that aren't shared. Website design and copy is totally different.
It seems like OP is unhappy that a competitor is funded by YC and did competitive research in their public community Slack channel. I get that, but I see no evidence that anything was directly copied. It doesn't seem fair to tarnish the reputation of Rehook's founders without evidence to back it up. It's not wrong or illegal to build a competitor to an existing product.
Depending on what they copied it can be anywhere from 'meh' to 'guilty'. What it looks like isn't relevant other than in the context of whether or not it is their original work or not.
Unless they literally stole your code, or had access to privileged information from your YC application or something, I doubt there is much you can do. It's not illegal to enter the same business as an existing company, or even to make an app that does the exact same thing. Where it starts to get iffy is when you start talking about people literally copying your HTML/CSS or what-not. Is that the case here? If so, call a lawyer. If not, ignore them and just execute better.
Marketing copy and sales documentation is also copyrighted.
Yes, that's why I said:
Where it starts to get iffy is when you start talking about people literally copying your HTML/CSS or what-not. Is that the case here? If so, call a lawyer.
where "or what-not" is short-hand for the exhaustive list of "things that can be copied" that I had neither the time not the inclination to list out explicitly.
Np, think of it as an enhancement, not in opposition. Your point was very valid. And it's exactly that kind of stuff that won me a lawsuit (15 lines of fairly unique Javascript exploiting a long lived bug in Explorer and Netscape to deliver streaming video to the browser without a plug-in).
YC companies also copy other YC companies. It happens all the time. Personally I would prefer that the world didn't work this way, but it's just how the game is played.
There are a lot of people in the tech world with the right connections, access to capital, and execution skill, but who either aren't creative enough to come up with an innovative product, or prefer to be the nth-mover in an already-validated market to the risk of trying to establish a new market. If they see that you have a good idea but aren't executing/growing/raising money at an A+ level, they will swoop in and copy your idea and then pretend that they were the first to come up with it.
There's nothing necessarily wrong with this apart from (imo) being kind of lame on a personal level. The consumer ultimately benefits from the competition, and you have only yourself to blame really for creating an opening by not executing quickly and effectively enough. It's capitalism. All the solutions to this 'problem' I've ever heard proposed--software patents and the like--create far worse problems for people who want to innovate.
If you're working on a new idea and are seeing real traction, you just need to expect this and factor it into your strategy. This is why so much emphasis is placed on having a 'moat' of some kind that is difficult to reproduce. If you're seeing success and it's easy to copy you, someone's probably already working on a clone.
Presumably they raised money, and will need to raise money again. That means that they have money (it's worthwhile to sue, assuming you can get damages). It also means it's a huge lever: they'll never be able to raise under active litigation, they'll have to tell their board, etc.
Now is the time to do this. If they just pivoted, and are literally copying you, they can just pivot to something else. You could even get them to agree to transfer/refer their customers as a settlement.
All this assumes they did something illegal. Copyright is the best thing to check: have they literally copied anything (APIs may be legal to copy, see Oracle vs Google).
> When people copy you, the best strategy is usually to ignore them. People who copy you are (a) unoriginal and (b) opportunists, and those are both strong predictors of failure. If you wait them out, they'll eventually drop away.
It sucks, but the only thing to do is kick ass in the field. The more successful you are, the more companies will copy you. We had companies with 30 or even 100 people hard pivot into an exact clone of our company when it was clear we had traction. We just have to keep out executing
I don't know, but the possible drama from this might be good for both companies. Start talking about it on twitter and see if you can get some reposts. Hopefully you can use it to your advantage, regardless of the legal outcome.
You can still apply multiple times after getting rejected. There’s plenty of stories of companies/founders that only got into YC after several rejections
To be honest, if I were in their situation I wouldn’t apply again, but it could be a good move regardless
I'm not sure what YC's stance is on investing in established businesses, but in the VC world as a rule it is 'not done' to invest in multiple competitors active in the same field. That path is rife with conflicts of interest.
You are right. Not sure about their official policy, but I know of multiple instances of where they’ve invested on competitors of their own companies
Sometimes this happens without them even knowing, because they put money into a company very early on, then the company pivots and starts competing with another YC company
This. By pivoting to your business model, they are lending it validation and doing you a favour. It’s another reason for a VC to invest in your product vs theirs, as you have been at it longer.
If you really believe in yourself and your team, work hard to outcompete them. Like many others have said, unless there is something illegal about this, it is fair game.
Very sorry to hear this. Did you have any copyright to the apis or the code? Or even a ToS on your slack channel? IANAL so wouldn't hurt to speak to a lawyer.
Also sorry I am not good reading the signals - why would being a female founder make you angrier than a non female founder? Id be angry as F too if a clone of my hard work appeared out of no where!
> Did you have any copyright to the apis or the code?
Any code that's written from scratch is automatically assigned copyright to the creator or their employer at the time of creation. API's are probably considered copyrighted by the courts but getting any kind of remedy for that will be exceedingly difficult after Google vs. Oracle.
> Id be angry as F too if a clone of my hard work appeared out of no where!
This happens literally all the time. I wouldn't recommend someone be a founder if this upsets them. No half-decent innovation isn't instantly cloned by 10 fly-by-night copycats and multiple large incumbents.
Yeah if the folks somehow copied code (hacking etc) there may be some grounds. Again this is black belt legal stuff. You beat me to it - especially after that whole GvsO case APIs getting copyright is also very tricky it feels to me.
> This happens literally all the time. I wouldn't recommend someone be a founder if this upsets them. No half-decent innovation isn't instantly cloned by 10 fly-by-night copycats and multiple large incumbents.
+10 - My only point here I wasnt sure why being a female founder mattered whether you could/should get angry. Getting angry is reasonable - just that what you do next and how you pick yourslef matters.
Talk to a lawyer. Copying your API is possibly a copyright violation. But take the lawyer's advice with the following grain of salt. It is in a lawyer's interest for you to go to court. But the best outcome FOR YOU is almost certainly a negotiated settlement. However your legal threat is the best way to get them to settle.
Or to get them to back the fuck off. If for instance they were the recipient of privileged information sent to YC (pure speculation!) then they may well be in trouble.
There's four kinds of intellectual property: Copyright, patent, trademark, and trade secret. Which of those did they violate?
Is your business defensible?
(Remember, APIs generally aren't protected by intellectual property. It's the implementation or patents that protect your product. For example, if copying your API violates your patent, then you have a case.)
It should go without saying that these shouldn't be new concepts to anyone running a startup.
That YC is advertising itself as 'female founder friendly' and to fund a bunch of - presumably, too little data - guys to copy the product of a female applicant that got rejected would be a strong move in the wrong direction.
But: since the OP doesn't supply any information at all all you can do is speculate about whether or not that is what happened.
It's very fair: YC bills itself as 'female founder friendly', if it turns out that you can't safely apply without your data leaking through to would be competitors that would be a serious problem. Note that there is zero proof for such a scenario but it is kind of odd that the OP applied there and that a YC backed company is now copying their business. At a minimum you'd expect YC to state very clearly that such a thing did not happen and that this is coincidence. That would put any speculation to that effect to rest.
I don’t understand why YC should object to fund a company that executed an idea that others also execute. Good ideas are a dime a dozen. What matters is the execution. If you execute well, your company will thrive. If everyone is doing it, maybe not.
I think it opens a very small can of worms. It is uncontroversial that founders and execution count more than ideas and originality in a VC setting. This is perhaps cynical, but welcome to the competition.
I think it’s fair. When a clone of your product is funded by the same entity that rejected yours, it's only logical to assess the differences that do exist.
Had she said “as a first-time founder,” I doubt the victim card argument would be raised.
When startups are fundraising or applying to incubators, there is no expectation of confidentiality.
I don't think it's fair to ewe to speculate on why YC rejected her company. What I will say is that incubators judge many factors into why they accept companies; and merely having a good idea, or good insight into what kind of product will succeed in the marketplace, isn't the only factor.
"Investors talk." It's perfectly reasonable to assume that investors would pass along good ideas that come from entrepreneurs who they don't think can bring them to fruition.
That being said, I do think it is poor form on ewe to play the minority status card. Most startups fail, so playing the victim when the odds are against you, just hurts your credibility.
That's not always as easy as you seem to want to make it. It can take a long time to establish a field and a product line, a copycat can skip all your mistakes and take the end product. Now: it all depends on what was copied. They've copied code, text from the website, other documentation they may well be in serious trouble. And then it helps that they happen to be funded because that makes them a nice fat & juicy target.
The last thing you want is to sue some party that is penniless.
matter of fact it does not, as when I posted this originally it was literally the last item on the front page. So, no. But keeping carrying water for this website and its companies! I'm sure they'll be real appreciative!
Edit: I should also note it is not on the front page any more
Would you like more of the front page to be people lobbing vague allegations at YC funded companies? The only reason it isn't flagged to death is because they make a point of staying out of YC stuff, it's definitely not front page material.
the idea that this forum "makes a point of staying out of YC stuff" is absurd, aside from the money, this site literally advertises for YC companies, on top of many other examples.
Reading these its quite obvious that they do, in fact, moderate on behalf of YC companies, they just proclaim that its "less, not more", which is utterly meaningless without examples or explicit rules and given that dang himself or someone he reports to or reports to him literally edited configs for the webserver so that the referrer headers on urls to asahi linux would evade a soft block, I'm kind of at a loss as to why I should believe them. Its bizarre and embarrassing that people are giving them a charitable read on this.
EDIT: I wouldn't trust the opinions of the 'just execute better' posters here, considering your competitors' employees already infiltrated your slack channel.