I believe YC accepted them for the idea and not for their strategy for acquihire. Kind of baffles me that just a 2 month old company gets acquired for talent, and that too for a not-an-out-of-the-world product
I assume they weren't able to get any additional funding, and were at the point where they needed to wind down the company. Another company comes along and says "we'll give you good jobs, and make your investors whole." So they take it. It's not like there was a Plan B.