We've thought of open sourcing some of YC's documents. The reason we haven't so far is that they're still getting tweaked. Which implies the earlier versions had holes. And the prospect of having other people use legal documents with holes is a lot more alarming than other people using software with bugs. I.e. we might get sued-- if not by benevolent founders, then by their evil investors.

Isn't this analogous to using open source software in a setting where bugs in the software might result in financial losses -- i.e. is there not a "NO WARRANTY, USE AT YOUR OWN RISK" clause that you can attach that is strong enough to shield you from any potential liability?

If you can get the legal angle sorted out, I'd personally find these sorts of documents useful. As for waiting for a version without "holes", that sounds like waiting until the software is perfect before shipping it :) It's not like a theoretically "bulletproof" set of templates would stop anyone from suing you anyway, if some company tanks and the investors are looking around desperately for someone to blame...

I think that disclaimer will be there anyway, so YC's concerns aren't about getting sued but about causing more harm than good.

That's an interesting idea -- I would imagine that there's a lot of commonality between the legal paperwork you need for most early-stage startups, and when differences exist, they can often be parameterized reasonably well ("$a founders, $b equity pool, $c shares per founder, vesting according to schedule $d", etc.). Putting some common templates for this kind of paperwork up on a wiki somewhere would be useful, I think.