Not as sinister as it seems. You could also not be approached for investment, launch your product, then get killed by a competing product from a big company, all the same.
But you would hypothetically be accounting for that outcome in your strategy. If I'm understanding the commentary correctly, Amazon would regularly invest in companies in order to gain access to their data and technology while another team used the info to undercut and kill their product. You don’t generally assume your investment partner is actively planning your demise by pretending to support you while siphoning off your life blood.
I agree though that it’s not as sinister as it initially seems. Companies create competition at times to stimulate product development even though it’s a shitty operating mode for the ground soldiers involved. In that case though they’re spending entirely of their own resources and not leeching off other investments to actively undermine a successful exit.
Perhaps startups are undervaluing their IP if this behavior is able to manifest easily. And in light of this news I’d be super hesitant as a board to allow any money from Amazon whatsoever.
It's different when the companies are being baited with investments to spill their secrets and visions to you, and then you take the idea and throw your infinite power behind it without them.
