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The problem with your logic is that if these ethically grey business models are profitable, you have to agree that the less morally demanding VC will indeed fund them (after all, profit is profit). Eventually, YC might still have their high ethical standards, but its the unscrupulous VC that makes the most dough. And the market selects for those who makes the most dough, not those who has the highest moral standing.



Well, YC does not control the entire market but they are certainly prominent in it and seem to have no lack of interest from investors and entrepreneurs.

I think what YC does probably does send stronger signals to the market through the startups they invest in than it does through pure dollars and cents.

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