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I'm really surprised YC are funding an illegal drug operation. The DOJ isn't enforcing anything against this criminal behavior, but that can change if the presi
by MichaelBurge 10y ago
I'm really surprised YC are funding an illegal drug operation. The DOJ isn't enforcing anything against this criminal behavior, but that can change if the president wakes up one day in a different mood.
Steps 1 and 2 are more subject to state law, but their step 3 is literally to set up a marketplace for illegal drugs over the internet(which crosses state borders).
If their marketplace is just a directory and doesn't accept payment, they can at least stay in business until they're raided. But I imagine it's going to be very difficult to find a bank that's willing to process payments for a company that handles illegal drugs, or even just to give you a checking account. They have enough problems with regulators as it is.
If you stick purely to software and essentially only handle contracts, I still wonder if a contract for illegal goods can be enforced in court. If I unwisely buy 1000lb of marijuana from their marketplace and they don't deliver, what's a judge going to do - order them to commit a crime to fulfill the contract? Or void the contract entirely, which makes the whole system meaningless?
- walrus01 10y ago> Steps 1 and 2 are more subject to state law, but their step 3 Step 1: Collect underpants Step 2: ??? Step 3: Profit
- chillacy 10y agoThe risk reward ratio is pretty favorable. If there's a big crackdown, that's another startup down, no big deal, startups fail all the time. Or there's no crackdown, and instead they have fewer competitors (because the industry is perceived as dangerous and risky) and they really take off.
- jsprogrammer 10y agoYou don't appear to have considered being charged by the Feds with inter-state drug trafficking, or similar.
- chillacy 10y agoI assume YC board members have consulted with their lawyers as far as their exposure goes.
- geofft 10y agoAre you surprised because it is risky to be illegal, or because it is unethical to be illegal? The practical legality of marijuana in many states is now basically the same as the practical legality of, oh, unlicensed transportation providers. You could be in trouble if someone wants to crack down -- and as demonstrated in Austin, this is distinctly plausible. And you could ask the same question: if I contract with a driver, and they refuse to do unlicensed pickups, can I actually get any restitution in court? (Yes, I know that YC itself hasn't invested in the major unlicensed-transportation-provider startups. But I really don't think that's because they found them too risky.)
- tmuir 10y agoI've read that credit unions which are not federally insured are not under the same restrictions, and can provide banking services to dispensaries. In Oregon, there are radio commercials for dispensaries, which say that they accept debit cards.
- MichaelBurge 10y agoDebit cards are doubly interesting because they go through a company like VISA or MasterCard, who I would expect to also not want this trouble. I have to say, it makes me a little bit happy they're respecting the interstate commerce clause if what you're saying is true. A credit union that doesn't allow interstate transfers from the marijuana account and doesn't settle transfers using the federal reserve does seem like it'd be outside their scope.
- louprado 10y agoVC's make bets on future. A bet that cannabis will be decriminalized and all the objections you raise will simply go away, seems like a sound assumption.