In an unexpected move, renowned venture firm Y Combinator has taken the decision to remove an Indian startup from its current batch, citing undisclosed “irregularities” within the company. This revelation comes from sources close to the matter, as reported by TechCrunch.
The startup in question, Medobed, originally secured a spot in Y Combinator’s prestigious S23 batch. However, recent developments have seen Y Combinator sever its ties with Medobed, with a YC partner going as far as advising potential investors to avoid any dealings with the Indian firm. This advisory stance was conveyed through an email obtained by TechCrunch.
Within this email, the YC group partner vaguely referred to “irregularities” at Medobed that contravened the firm’s ethics policy, but refrained from providing specific details. The email strongly recommended disengaging entirely from Medobed, clarifying that Medobed would no longer participate in YC events, including the demo day, and appeared to have not secured any funding during this process.
Both Y Combinator and Medobed have remained unresponsive to inquiries from TechCrunch as of August 29. Furthermore, Y Combinator has removed all references to Medobed from its official website.
An anonymous investor, who had been separately pitched by Medobed, expressed suspicions regarding the founder’s claims. The founder frequently altered details related to his educational background, and the company’s reported growth metrics, which included “$1 million of monthly GMV and EBITDA profitability,” appeared inconsistent. TechCrunch was unable to independently verify these claims.
Y Combinator’s decision to remove a startup from its highly sought-after batch is a rare occurrence, considering the rigorous selection process that the firm conducts. Notably, India has emerged as a significant market for YC over the past five years.
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