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Ask YC: Ethical Question, possible fraud

news.ycombinator.com

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Re: Ask YC: Ethical Question, possible fraud

#31

Post by jamiequint »

gunderson wrote: post #13

I can't advise you to leave b/c that's just the way sales happens -- you aren't going to escape this sort of thing even if you go to work for a non profit. Non profits often exaggerate the amount of good they do and how important their cause is -- and how efficient they are or are not. The bottom line is that it's tough to bootstrap a company and sometimes the salespeople will "throw the ball ahead of the runner" a b…

I ran a consulting company that did some work for large "name brand" corporations. I bid on projects for companies we should have never had access to and I didn't have to lie to do it. Its a positioning game, you position your weakness as strength. For an excellent contemporary example of this see Barack Obama's campaign. Whether you like Obama or not, he has managed to position his relative inexperience as a strength. Similar tricks are possible within a company, NO LYING REQUIRED.

It sounds like you're trying to convince yourself that lying as a means to the end is OK. Its a pretty weak argument, or rather excuse to not work hard and do things honestly.

The suggestion that what this founder is doing is "spirited optimism" is sickening.

Re: Ask YC: Ethical Question, possible fraud

#32

Post by icey »

Harkins wrote: post #22

I've been in roughly this situation, where the founder of a small company made grandiose claims and would say anything to get the sale, get another round of investment, get his way. Reevaluate any promises he's made to you or any agreements you think you have with him. If you have a manager between you and him, same goes. A manager who is much closer than you to his dishonesty and is OK with it is going to act the sa…

This advice is correct on every level. Get out now. (I've been in this situation as well, with painful results.)

Re: Ask YC: Ethical Question, possible fraud

#33

Post by SwellJoe »

dcurtis wrote: post #20
prakash wrote: post #10

Ever heard of WinFS? A good personal moral compass in such situations is whatever helps you sleep soundly at night. Life is rarely black or white, more shades of grey (can't remember where I read that). Curious to know, what would you have said in the same situation, would you have said we have 2 customers, one office, couple of customers, you would be third if we are lucky and hey guess what you are going to beta te…

Number 2 is kind of abstract. There are a lot of ways to interpret "putting your customer's interest before your company's." You could make the software cheaper, for example, but you probably won't. I've thought a lot about how far to bend to customers demands the past few weeks as I've been working on a fairly large project geared toward companies that are used to influencing product design and direction. In enterpr…

"There are a lot of ways to interpret "putting your customer's interest before your company's." You could make the software cheaper, for example, but you probably won't."

I have to agree on the interpretation problem here. But, I think an important thing to learn in business is that sometimes lowering your price is bad for your customers. You may have more of them because of a price drop...but you'll almost certainly serve them less effectively. It took me way too many years to learn this simple fact (and Joel Spolsky hadn't yet written his very good article on the subject when I was learning it).

Re: Ask YC: Ethical Question, possible fraud

#34

Post by gunderson »

jamiequint wrote: post #31
gunderson wrote: post #13

I can't advise you to leave b/c that's just the way sales happens -- you aren't going to escape this sort of thing even if you go to work for a non profit. Non profits often exaggerate the amount of good they do and how important their cause is -- and how efficient they are or are not. The bottom line is that it's tough to bootstrap a company and sometimes the salespeople will "throw the ball ahead of the runner" a b…

I ran a consulting company that did some work for large "name brand" corporations. I bid on projects for companies we should have never had access to and I didn't have to lie to do it. Its a positioning game, you position your weakness as strength. For an excellent contemporary example of this see Barack Obama's campaign. Whether you like Obama or not, he has managed to position his relative inexperience as a strengt…

I'm not saying that lying is good, but in any small company there is (or should be) a collective belief in the success of the company and its product. If we wanted to be rational we could just look at the numbers and realize that over 80% of startups fail and mention that when on the phone with prospective clients!

My point is that it's not a good idea to get overly worked up about someone in sales stretching the truth a bit. Sales is the part of the organization that responds to customer needs, and so if they promise a feature to a client, you as the developer are more likely to end up building that feature than if it was never promised and the sale was lost.

It's an imperfect system, but at its core it's not any different from Ford running a commercial that suggests that its operations actually benefit the environment. People believe what they want to believe in order to give themselves an excuse to buy what they want. If the founder in question is outright lying, then he's just not very good at helping customers rationalize the purchase.... :)

Re: Ask YC: Ethical Question, possible fraud

#35

Post by h34t »

I would quietly & politely leave, possibly after a candid, thoughtful conversation with the founder in question. Or, I would be quiet and put up with it.

Five years ago, at 20 years old, I was offered an amazing opportunity -- running leadership conferences across Canada, and leading teams of youth around the world to promote business/development. I'd been running projects with the organization for a couple of years and absolutely loved it.

Then, I discovered that the founder was committing fraud with taxpayer money -- criminal mismanagement. Had anyone gone to the media, it would have been a juicy scandal involving taxpayer money (but that would only have hurt the youth involved). He was hurting himself, his family, and at times even putting people in danger.

After consulting mentors I trusted (an ethics law professor, retired business person and retired diplomat)and a five hour conversation with the President, I turned down his bribes and caused a minor but localized fuss in a genuine attempt to improve the situation. It was unsuccessful.

Even though I was right, and even though my mentors and friends verified this and helped me form my actions, I would have been much better off by keeping my mouth shut, politely declining their job offer, and simply shifting my focus to creating my own future.

This would have avoided the stress of going through hell in a fruitless attempt to make things better, that most people would never understand and would leave me disconnected to a group of people I loved being apart of (aside for just the couple of people who were causing all this nonsense) -- I was disconnected from them because I couldn't explain why I was taking action without endangering the good that the org. was also doing for a lot of young people. ie. I didn't want to harm the org. by actually having the media get wind of it.

So next time I will button my lip, acknowledge the world exactly as it is, and stay focused on what I want my own life to be instead of getting hung up on others..

Re: Ask YC: Ethical Question, possible fraud

#36

Post by LukeG »

gm wrote: post #9

There is a fine line between fraud and salesmanship... This is actually one of the things that lawyers learn at law school... What I would do is not listen to that. They have their job (selling the software) and you have yours. If they commit a fraud, you will not go to jail for it. Do you hear the car dealership mechanic tell the customers the cars was NOT really driven by an old lady to church every Saturday? Now,…

Ignoring it is wrong. You have a responsibility to do something, even it it's just talking to your boss.

Re: Ask YC: Ethical Question, possible fraud

#38

Post by ConradHex »

mcescher wrote: post #8

Bill Gates did this stuff dealing with IBM et al. If you CAN do X, and the only thing stopping you from getting the deal is the other side's perception of you, then influencing their perception (i.e. lying) can save the deal, save your company, and solve their problem -- all at the same time. It can OFTEN be in BOTH your AND your client's best interest to lie. And ask for forgiveness later after they are happy with y…

> It can OFTEN be in BOTH your AND your client's best interest to lie.

Hmmm... this sounds like a slippery slope to me.

Re: Ask YC: Ethical Question, possible fraud

#39

Post by andreyf »

h34t wrote: post #35

I would quietly & politely leave, possibly after a candid, thoughtful conversation with the founder in question. Or, I would be quiet and put up with it. Five years ago, at 20 years old, I was offered an amazing opportunity -- running leadership conferences across Canada, and leading teams of youth around the world to promote business/development. I'd been running projects with the organization for a couple of years…

From the way you explain it, you seem like a nice guy, giving nice guy advice. It's a bit ironic, however, that you were supposed to be running leadership conferences - shouldn't a "good leader" rally people against perceived injustice? Surely, it would be hard to argue that criminal mismanagement is just. Could there have been some way you could have "created your own future" without letting criminal actions stand?

Re: Ask YC: Ethical Question, possible fraud

#40

Post by andreyf »

prakash wrote: post #10

Ever heard of WinFS? A good personal moral compass in such situations is whatever helps you sleep soundly at night. Life is rarely black or white, more shades of grey (can't remember where I read that). Curious to know, what would you have said in the same situation, would you have said we have 2 customers, one office, couple of customers, you would be third if we are lucky and hey guess what you are going to beta te…

Curious to know, what would you have said in the same situation, would you have said we have 2 customers, one office, couple of customers, you would be third if we are lucky and hey guess what you are going to beta test our product.

No, but how about... "No, we are not a major corporation with millions of customers. This has many effects on how we'll do business with you. For one, it allows us to provide you with the kind of attention and customer service unmatched by our competitors. As one of our first customers, you have a strong influence on how our product lines evolve, what features we implement, and what bugs we fix first. We can also offer you {special service program}, something we will only offer our first {100} customers, to help us evolve our software to address all of your needs. Being a fresh competitor in {this market} also holds our product to a significantly higher standard - the purchases you make from us can't be justified as the 'market default', and so we have to compete on features and quality, such as {specific features and examples of better quality}."

But I'm just a programmer, not a good business person; I'm sure a good business person can make it sound much better.

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