Founders: Beware of Fake Investor Scams

An article we liked from Thought Leader DC Palter:

Founders: Avoid Getting Scammed by Fake Investors

Beware of scammers posing as investors to steal your money

One of the companies I advise was nearly scammed out of $7,000 by a team posing as angel investors offering to invest in their business. The scammers were very good, and their story plausible. This was not an email from the supposed widow of the Nigerian oil minister, though in the end, their fake fee scam worked the same way.

All founders need to beware of this fake investor scam. With so many new startups looking for funding, the problem is certain to grow worse.

The scam starts with an outreach from supposed investors that looks like this:

We are a group of high-net-worth investors in the UK looking for our first angel investment in an early-stage startup. If your startup is looking for capital, please email us your executive summary for review.

No typos, no bad English. It asks for an executive summary rather than a pitch deck, but we can chalk that up to being new to angel investing or being in the UK, where they talk funny anyway. It sounds plausible, especially to an inexperienced founder who doesn’t know that angel investors don’t pop up like this.

What startup founder isn’t always looking for capital? A group of investors with money ready to invest — hell yes. Sign us up!

With some healthy skepticism, the founders replied with a short elevator pitch and the latest pitch deck, the same as they would with any potential investor — no harm in seeing where it goes.

A few days later…

Read the rest of this article at STARTUPEVENTS.ORG…

Want to share your news or advice for startup entrepreneurs? Submit a Guest Post here.

Ready for more startup news, free expert advice, and events? Choose from 7 free email newsletters to help grow your business and join the Startup Council FREE here now: https://StartupCouncil.org/joinsc