Place holder for comments linked to from here.

@blunders Are you asking about businesses who are aware that their activities are illegal (in which case, one imagines that they focus on hiding their illegality/not getting caught), or businesses who are acting illegally without knowing it (in which case, one imagines that they're ill-informed due to inadequate planning, execution and reporting)?

@eggyal Many do try to hide the activities, attempt to shield themselves via contracts, litigate, settle, file for bankruptcy, or claim that the activities are not illegal, but extralegal. In general, my position has always been to avoid business models that are not 100% legal, but often wonder if that's a view that limits business opportunities. Updated the question in an attempt to address your question, if it's still not clear, let me know.

(just reposting my response since it's unclear what's not clear to you.)

@blunders It's unclear to me whether you're asking about businesses who are aware that their activities are illegal, or businesses who are acting illegally without knowing it?

@eggyal In the end, given the resources, if something is legal requires years of litigation, which clearly is costly. Here's an example of what I'm looking for, "How to Run an Illegal Start-up."

Does this address the ambiguities your seeing, and if so, please either edit the question directly, or express how you believe the question might be edited to respond to the issues you're attempt get clarification on. Thanks!

@blunders I really don't understand your comment, "if something is legal requires years of litigation". Nor do I see how that addresses the question that I have now asked three times: are you asking about businesses who are aware that their activities are illegal, or businesses who are acting illegally without knowing it? It's an either-or question: are you able to just say to which of those two scenarios your question is referring? If not, why not?

The article to which you have linked suggests that you are referring to businesses who act illegally without knowing it; whereas your comment "many do try to hide" etc suggests that you are referring to businesses who are aware that their activities are illegal. Can you give some more specific details about the precise problem that you are facing in your startup and how we can help to solve it for you?

Meanwhile, I am voting to close as "unclear what you are asking".

@eggyal Sorry, but I don't agree it's an either or question; understand that might not have been clear from my response, but that's my position, and based on years of real world litigation. Did you review the article I linked to?

@blunders Yes I have read the article (indeed, I have given my view that it is referring to businesses who act illegally without knowing it). And I assure you, my question was either-or (though I accept that it may not be something you're able to answer in that way: but if that's so, it'd be really helpful if you could articulate why not).

@eggyal In my opinion, the article clearly states the businesses are aware its activities maybe ultimately be judged illegal, and that the legal strategy needs to reflect an informed cost-benefit analysis.

Deleting the question, since I've found an answer, and it appears I am unable to resolve your concerns.

@blunders FWIW, I think there is a huge difference between a business striving to act legally (but being vaguely aware that, for example, its privacy controls might not be in full compliance with the esoteric laws of some obscure jurisdiction in which it operates) and a business that sets out to operate illegally in the full knowledge that it is breaking the law.

Consider, for example, Google discovering that it has broken privacy laws in Europe vs The Dread Pirate Roberts operating the Silk Road marketplace.

"The Dread Pirate Roberts" is a bad example in my opinion, in part because because his legal strategy was so poor. Also, in my opinion, Google knew it broke privacy laws in Europe, but it had a strategy that at the very least didn't result in their CEO in jail, unlike DPR. Point is there are hundred of examples, but that doesn't address how to best evaluate the cost-benefit of engaging in markets and tactics that maybe ultimately be judged illegal, and how to best manage the related risks.

@eggyal Joel's comment, "The last 'OnStartups' site filled up with a lot of junk; hope this iteration does better" - does not strike me as being in support of a Startup.SE, but I might be wrong.

@blunders It's probably not worth taking the specific examples much further, but I will note that Larry Page could never have landed in gaol because that sanction isn't available for privacy offences; also, DPR's "legal strategy" was to keep his identity hidden (and it would seem he failed).

My question was simply designed to establish whether you were interested in how a person like DPR (who sets about to commit crimes and whose priority is to evade law enforcement) should act; or how a person like Larry Page (who sets about to conduct legitimate business and whose priority is to demonstrate that their actions are lawful) should act. Despite asking repeatedly, it's still unclear to me which scenario you were interested in—but that's fine: others may understand what you're after.

@blunders Whatever you might think of his comment, he did commit to the proposal. And such commitment indicates that one intends to participate in the beta to ensure its success.

@eggyal I agree that it would likely might what the parties' awareness of the activities, there legality, and response, but I personally see this as a subset of factors, especially given that I would hope it is clear that my position is that the startup does in fact become aware of the potential legal conflicts. If it matters, I would simple state that the execute staff is aware of the potential legal conflicts.

@eggyal Appears that Joel in fact did take part in OnStartup - so, maybe you're right, and I've misunderstood the meaning of his comment.