@birch I'm just a random person who is so far away from YC and the rest of this "scene" they might as well be on the moon. But I have been a software engineer for a long time and have started a successful software business, so I feel that's "good enough" for a random comment here ...
As unfortunate as it is that these startups failed, that is supposed to be a major element of what venture capital firms do. Risk management, risk analysis.
Someone pitches you a product idea tied directly to a major company's API, with the intentions of that company unknown and motives unclear? So with one swift move they can destroy the whole concept and just do it themselves?
I, the unsophisticated investor that I am, would still see that and put that well into the
"very high risk" "extremely high risk" "absurdly high risk" category, next to the "don't even think about it" category.
But, I'm not a VC so maybe I just never got the memo with the details.
Instead, I see hundreds of thousands of dollars being invested on one side, and then the other side comes along and does the thing that made the investments risky.
It wasn't shocking, quite the opposite ... it seemed perfectly rational. Not something the startups wanted to happen, but must have been at least on the radar.
OpenAI being a business, that's usually "money is good" and you want to get more of it. So they ran some numbers, they turned out good, and so they did it.
I simply don't see why this is surprising, even shocking ... and the resulting drama.