It looks like there is a new scam going around targeting startups and small business. These seem to be well funded scammers, they target innovators with software and deep tech products that aren't funded yet. They steal the identities of small Investment holding companies or angels and use that to target founders with an ID theft scam of their corporate and personal identities that could potentially ruin them.
I did some research and started by looking at a few crowd funding sites that seem to be publishing more information then needed around startup ideas and came across EquityNet. I tested it out and sure enough, after a few weeks I started getting unsolicited emails from so called "investors" who had found us on EquityNet.
So I started checking out these "investors" one by one, first at the domain level on whois.net and getting namecheap.com as a DNS provider for each one, then we ran them through ScamAdvisor. The first "investor" that reached out had a 2/100 rating on Scam Advisor.
Not so good, in fact just about the worst rating possible, though you could argue 1/100 is technically worse, it seems implausible or broken while 2/100 seems legit and just bad. I kept looking, but didn't see anything on the typical reporting sites relating to them scamming startups. They were all foreign holding companies with small investment portfolios, claiming to be looking into US startups based on the current market trends.
All of these "investors" had similar Scam Advisor ratings but no reports. Based on the registry info for each one of them though, we found similarities that pointed to a very obvious scam. Each scam had a similar profile, they found small investment and holding companies without international web presences and created english language websites and email accounts. This essentially allowed them to start up their own shadow investment firms. They used these shadow companies to steal not only money from founders, by way of fake investor insurance policies, but also to document everything about each startup idea, business entity and founder. Then with identities in hand, as well as the business idea associated with the startup they can steal from the founders accounts, fake there identity as well as pitch or sell the idea to real investors either as their own, or masquerading as the startup whose identity they had stolen. Since discovering this we have had a few others come to us with similar stories looking for advise as well as starting to now report it.
If your a founder, or working on project that is looking for funding keep an eye out and vet them thoroughly, and never go for a pay-for-play scheme where they as for a deposit or insurance. More often then not if you just show an investor a SAFE note or something similar, they will let you know if they are legit or not quickly.
I posted the full and original version of this article on for Buildly.
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