Y Combinator, a renowned venture firm, has taken the step of excluding an Indian startup from its batch due to the discovery of “irregularities” within the company, according to individuals familiar with the situation who spoke with TechCrunch.
The startup in question is Medobed, an Indian company that initially gained admission into Y Combinator’s S23 batch. However, Y Combinator has recently severed its association with Medobed after uncovering issues and irregularities. A partner at the venture firm has also advised potential investors to avoid any engagement with Medobed. This recommendation was conveyed through an email, a copy of which TechCrunch obtained, sent by a YC group partner. The partner noted that the startup’s activities breached the firm’s ethics policy, without providing further details.
The YC partner’s email stated, “If you have anything outstanding with this company, our recommendation is to disengage completely with the company.” Consequently, Medobed is no longer associated with YC and won’t participate in YC demo day. Additionally, the startup appears not to have secured any funding through this YC process.
Despite TechCrunch’s outreach, both Y Combinator and Medobed founders remained unavailable for comment as of August 29. Notably, Y Combinator has also erased any mentions of Medobed from its official website.
An investor who had been approached by Medobed separately expressed suspicions regarding the startup’s claims. The founder’s account of educational history frequently changed, and the company’s growth metrics, which included “$1 million of monthly GMV and EBITDA profitability,” seemed inconsistent, the investor revealed. For candor, the investor chose to remain anonymous. TechCrunch was unable to independently verify these claims.
It is highly uncommon for Y Combinator, which selects a small fraction of startups from a large pool of applications, to remove a firm from its prestigious program. Over the past few years, India has become a significant market for Y Combinator’s operations.
