Founder Alleges That YC-Backed Fintech Startup is 'Copy-and-Pasting' Its Business

A new startup lifting elements of competing businesses is far from unusual in today's venture world, but sometimes competing founders don't find the imitation all that flattering. From a report: Andy Bromberg, CEO of the a16z-backed startup Eco, is claiming that Pebble, another fintech startup that came out of stealth this morning, "plagiarized" Eco's materials and business model. Bromberg posted a Twitter thread this afternoon saying Pebble engaged in "copy-and-pasting, immaturity, lying, and espionage." In the thread, Bromberg detailed the background behind his claims, and he also spoke to TechCrunch about the allegations.

Bromberg claims the Pebble co-founders, CEO Aaron Bai and CTO Sahil Phadnis, impersonated Y Combinator investors to get access to Eco's waitlist. He also alleges that Phadnis asked detailed questions about Eco's backend under the guise of looking for employment and that multiple aspects of Pebble's product and marketing language are essentially copy-pasted from Eco. TechCrunch covered the news earlier this week that Pebble, which participated in Y Combinator's Winter 2022 cohort, raised $6.2 million in seed funding from YC itself alongside LightShed Ventures, Eniac Ventures, Global Founders Capital, Montage Ventures, Soma Capital and angel investors.

On its website, Pebble, founded last year, calls itself "the first app that pays you to save, spend, and send your money -- all in one balance." It launched with two core products -- a 5% APY interest offering for customer cash deposits, and a 5% cash back offering when customers spend at its partner merchants, which include Uber, Amazon and Chipotle, Pebble CEO Aaron Bai said. The former product is based on the model of taking in customer funds, converting them to stablecoins, and lending them out to institutions, Bai explained at the time. Bromberg subsequently told TechCrunch that both core products were based on two of Eco's core offerings.

If it's one thing businessmen hate above all else

[rsilvergun]

it's competition. And they will use any and all available dirty tricks to stop it.

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[account_deleted]

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[stonecypher]

oh, poor slashdotter, trying to explain that plagiarism should be expected

it's actually disgusting though, and entirely unlike the patent you named

please stop embarrassing yourself this way

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[account_deleted]

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[HotNeedleOfInquiry]

"It's hard to take you seriously when you start with an ad hominem attack."

You must be new here.

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[msmonroe]

Do they have a defensible IP? If Eco has a patent on their technology and has a unique offering, they can sue Pebble. Eco seems like it has nothing unique to offer and is shitposting about another company coming into the crowded fintech space.

Bromberg claims the Pebble co-founders, CEO Aaron Bai and CTO Sahil Phadnis, impersonated Y Combinator investors to get access to Eco's waitlist. He also alleges that Phadnis asked detailed questions about Eco's backend under the guise of looking for employment and that multiple aspects of Pebble's product and marketing language are essentially copy-pasted from Eco.

This is only an allegation. If this is true whoever revealed this information to applicants is a dumbass and should be fired, if it's actually true. lol

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[mbkennel]

confidential information obtained by impersonation and fraud?

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[account_deleted]

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[Whateverthisis]

I would disagree with that. Assuming what Eco's CEO is alleging is actually true, then representing themselves as a Y-Combinator investment team and then claiming due diligence to gain access to their customer pipeline is pretty slimey. Depending on what they did during this alleged visit, it could be considered fraud (for example if htey signed an NDA to get the client list; NDAs often have specific purposes for data and this is usually one of those called out), although technically misrepresenting yours

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[account_deleted]

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[registrations_suck]

Yeah...in other words, the complaining company didn't bother to do any due diligence as to who they were talking to and got played. Boo hoo!

Hard pass

[muh_freeze_peach]

Good grief. They want to take your real money, turn it into funny money, loan that funny money out in hope it returns with interest, and also hope the funny money doesn't vaporize? Thanks, I hate it.

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[edi_guy]

Totally. The magic yields on these accounts of 5% while a 'good' return on an FDIC savings account is closer to 0.7% smells. Then I read that bit about the stablecoin and we're back in Luna coin craziness (Luna-cy). Recall the whole purpose of the the Luna stablecoin was to gin up demand for Terra:

"Access the first successful, decentralized algorithmic stablecoin. Participate in the value creation of a new DeFi stack"

Terra was paying something like 25% (!) annual returns...which were 'created' by gettin

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[Jason Earl]

Exactly. These guys have a ridiculously slimy business model. It shouldn't surprise them that other slimy people might want to steal their business model.

I mean, honestly, they are tricking people into changing actual money into imaginary money, and we are supposed to feel bad for them because someone pretended to be a VC and stole their client list from them. Boo-Freaking-Hoo.

Mom!

[awwshit]

Mom! Pebble won't stop copying me!

Cryptobros?

[waspleg]

Tell me again why we don't need strict regulation for all this fraud.

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[smooth wombat]

It helps weed out the stupid.

Also, gives us something to laugh about when we hear their sob stories about how broke they are.

Pebble?

[Anonymous Coward]

isnt that a smart watch?

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[DarkRookie2]

https://www.pebble.us/ [pebble.us]
Banking app that is promising way too much for free.

Fake Banking Apps

[DarkRookie2]

Just skip them both.

Honor among thieves

[algaeman]

So we set up a crypto company.. yada yada.. a lot of investors lost their money.

Unsurprisingly, no FDIC/NCUA

[jacks smirking reven]

And they address it: Looking at FDIC Insurance with Perspective [pebble.us] and they called it a "failed system" with a bunch of half truths, distortions and some what I feel are outright deceptions.

The future of finance is increasingly being built upon new rails, which is insulated against bank runs and marked by revolutionary security. As this new approach to finance expands, FDIC insurance may one day be completely unnecessary.

Holy shit that is some hardcore cope.

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[nadass]

Hahaha! They should probably update their stance after the week-old bank runs on Terra and Luna cryptos (not to mention the previous ones, or the ways in which the banks/crypto-wallets keep getting hacked/bilked).

We're definitely in a crypto-bubble when VCs pour any amounts of money into Pets.com-esque startups like these; at least Pets.com carried some tangible value as an e-commerce service.

Re:Unsurprisingly, no FDIC/NCUA

[mbkennel]

The web page is wildly "pants on fire lie" misleading. "But with more research, you’ll find that 489 FDIC-insured banks failed during the financial crisis years of 2008 through 2013. And the FDIC couldn’t pay a single one of their customers out."

There has never been a loss of a FDIC insured deposit amount since the start of the program in 1933, including 2008-2013.

FDIC insured deposits are considered to be legally backed by Full Faith and Credit of US Treasury, same obligation as Treasury bills (default is prohibited by US Constitution). There will never be a default on FFAC as long as there is a US government.

How it actually worked: FDIC arranges for stronger banks to take over the deposits and operations of the weak ones and finances it as necessary to protect FDIC depositors. I had a Washington Mutual account. Chase took it over with no change. I never lost access to funds.

If a bank assuming the deposits is not possible then FDIC will pay out directly to depositors, but that's a slower process than their preferred one.

There was not any danger ever that FDIC system would fail. FDIC insures deposits. It does not insure equity stockholders of banks, so banks are supposed to fail with FDIC.

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[Pascoea]

I promptly lost access to 99.9% of my funds.

You didn't have funds. You had shared ownership of a company that went tits-up. The job of the FDIC isn't to protect investments (risky, or otherwise) it's to make sure your checking and savings accounts aren't gone tomorrow.

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[account_deleted]

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Should have done an NFT

[ljw1004]

If only the founder had created an NFT of his business-plan, then it wouldn't matter that other people copy+pasted; the founder would still "own" the actual original business plan.

boo hoo

[juancn]

Business is all about execution, not ideas. Ideas are worth shit, unless executed properly. Yeah, every once in a while there's a disruptive, truly disruptive, innovation, but most of the times, it's borderline obvious and you just need to excel at doing it right.

Usually if there's no competition, there's no market for it.