Great advice, Ayo. You should be blogging! edit

Just today, I asked a person to run a venture and all he wanted was for me to open a bank account, send my personal information, then he wanted me to invest for him. I told him before all that, that I don't invest for people anymore.


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Thanks Ayo. We have been fortunate to raise some money through PartnerUp connections, however I do agree that many of those types of offers that you describe aren't legitimate.

Best,

Jon Harris
www.wisejackcooking.com edit

Hi Ayo,

Very good heads-up for the less sophisticated here. A good place to hook up with a VC is on the VC group on LinkedIN. In addition, all legitimate VCs will be registered with the NASD and can be looked up there. Most also participate in a national trade association. You can also check with the state's corporation commission to see if the business is registered.

The other word of caution relates to individuals offering to invest here, particularly if offshore which makes identity verification and due diligence more challenging. I use an investor questionnaire which helps determine that the investor is accredited under the SEC's safe-harbor rules and provides due diligence information. We use a company that runs international background checks and if the information cannot be sufficiently verified, we pass on the investment.

The reason for this, on advice of Counsel, is that there are Nigerian 419 scams involving impersonating an investor to get your banking and other information.

If the "investor" resists or appears offended by your request for references or information about him/her that can verify his/her identity, something is wrong. A sophisticated, accredited investor would appreciate your cautious approach and good judgment in vetting the investor.
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I must say, PartnerUp seems to abound with Nigerian 419 scammers. If you are not familiar with Nigerian 419 scams, you should Google the term. I was contacted today by one wanting to pitch financing for my venture. His post opened with "Hello Dear" which is the classic Nigerian 419 scam email greeting. They do not realize that U.S. Business professionals would never great one another with a term of endearment.

Then I noticed this same person posted a barrage of topics on PartnerUp in the last 24 hours as both an investor and as several businesses needing funding.

I have been contacted by others who I am fairly certain are also Nigerian 419 scammers working PartnerUp.

The bottom line: do not ever agree to open a bank account and then send your personal credentials to anyone questionable on PartnerUp. Do not ever pay an upfront fee to anyone on PartnerUp. Beware off offshore "lenders" who could be posing as U.S. lenders as their applications may be just for the purpose of stealing your identity, account numbers, social security number, etc.

In short, if you cannot verify who the investor or lender is by verifying licensing with NASD and state corporations and securities regulators, I wouldn't touch it!

Aren't there any Moderators watching over PartnerUp topics? It's a great concept but those who have great ideas but lack experience with the way legitimate investors and lenders work, may get hurt here!

Watch out for those wolves in sheep's clothing! If it sounds to good to be true--it likely is! edit

Ayo is correct (to a great degree). I've been saying this for years. Sites like MeetUp & Linkedin are pretty much solely populated by individuals with ideas & ventures they are seeking to get funded, as well as vultures on the make. I've never encountered a single serious entrepreneurial investor looking to find projects they could back or partner on. The alleged Pro's have their dubious lawyers looking out for profitable possibilities in their interest. Quite often lawyers pass up projects with certain rapid turnover when they find a producer in need of funding that can't afford an up-front fee (which is generally all that lawyers are concerned with), and the shortsighted demand for instant money frequently leads to loss of millions in potential returns. I went through a case like that from 1979 through 1991 where I couldn't find a lawyer to work "with me", and help me locate the $2 million needed to obtain the most valuable TV archive in existence. They all realized the priceless acquisition would quickly generate a $100 million, which meant a million in their own pockets within months, but they were only concerned with a $5.or $10 thousand advance for their 15 minutes of time needed to go through their Rolodex & find the right candidate investor/partner.
As for "LinkedIn". I joined every Venture capital group, which I visited and posted on daily for 4 years. . They are ALL a waste of time! The site is only occupied by those seeking to get funded AND scam artists preying upon the naivety of fools gullible enough to believe some guy in Turkey or India or even Fort Lauderdale is going to help them get funded for a fee. Linkedin is just plain useless because the folks running it do not investigate who is legitimate or not. They keep removing harmless helpless individuals who are not hurtful to anyone, simply because a scam artist made a complaint about someone he couldn't victimize.. It's not easy to find investors because there is no Oasis where wealthy financiers hang out to encounter entrepreneurial geniuses they could help fund. If there was, we'd all be living in Disneyland - without having to pay the admission. . edit

Plus, those that aren't even looking for an investor, but only a partner, is the case. edit

Hi , it is depend business to business and requirement . some time people don't need investor but yes a partner to run or support their business.

first check out the business requirement may be its profitable. i am also looking for business partner who can give time to my business (part time ) if works then they can think further.
my website : www.egloble.in email id :info:egloble.in edit