In search of investments: how not to fly into the web of "divorce"
Continuation of the topic about "investors" and "consultants"
Andrey Stadnik, BFM Group UkraineA long-time client who is looking for financing for his investment project called me yesterday.
Quite a serious project, worth about $ 20 million, for which our company recently conducted pre-investment research and developed a business plan.
And he called on such a question. They approached him the other day from some company, and vaguely introduced themselves, offered financing.
All that was understood by the client from the telephone conversation is that the company is acting on behalf of some international banking syndicate and finances projects of various industry orientation on the territory of Ukraine. Also, they say, represents a British financial company, which includes 5 American banks and 2 insurance companies, the turnover of which is more than $ 100 billion.
They agreed to arrange a personal meeting. Well, since I act as a project expert and accompany him at all stages, my presence at negotiations with investors is mandatory.
Something, however, alerted. First of all, I had never heard of such a company before, and only the mobile phone number remained as contact data. And in general, strictly speaking, for normal people, such meetings are preceded by a certain business correspondence, the study of the information provided, some kind of primary due diligence, industry expertise.
Well, Google, as they say, to help. It took 10 seconds to discover that the phone number from which the call was made appeared in several vacancies. Then it's easier. Having seen E-mail and landlines there, it remains only to find the name of the company, corporate websites and other information on the topic.
What was found immediately?
First of all, there are a lot of negative responses from former employees of this charade and a huge topic of discussion on one of the financial forums.
It took another 10 minutes to find out by WHOIS that the site (by the way, "sloppy on the knee") allegedly, the English company is registered on a Ukrainian hosting, and the domain name belongs to an individual.
On the "Clients and Partners" page there is an impressive list of banks. I enter each one in turn into the search engine – such banks do not exist in nature.
They don't have a physical office in London. This is indeed the address of a British company, but providing paid mailbox services and subscription service of a virtual office.
And for the sake of sporting interest, knowing the names of Ukrainian companies, I pulled their registration data from the IRC register, and after receiving the full name of the founders, I found out that only two young people born in 1985 were behind all this.
The divorce scheme is as simple as a felt boot and is used everywhere:
- Contract for the performance of services.
- Filling out an investment application and paying USD 300 for its consideration and supposedly forwarding to London.
- The act of completed works.
- Receiving a "positive response" (they themselves respond).
- Ordering and depositing of cambios (bills of exchange, in our opinion).
- Payment for cambio is USD 1500.
- The act of completed works.
- Choosing a payment agent and opening an account – USD 500.
- The act of completed works.
- Conducting an audit – USD 5000 (Not PWC and KPMG, but an unknown state of emergency Ivanov).
- The act of completed works.
- Assessment, business plan, legal opinion, agreement of terms and issue of debt obligations, insurance, risk certification, execution of contracts, signing of additional conditions and so on.
Between each of the points – the signing of the Act of acceptance and transfer of the work performed under the contract.
When you spend 50-70 000 of evergreen money, and the case seems to be coming to the final stage and the first transaction, they will start throwing up their hands, offering you to call the London office on your own and begin to hide from you if possible. I remind you that when you call London numbers, they will talk to you from Kiev. With a Slavic accent, which you will take for a Welsh dialect.
It should be remembered that competently drawn up contracts for the performance of services and signed acts of acceptance and transfer of works under the contract are their legal protection.
And their defense is quite competent. The contracts are drawn up in such a way that you do not have the opportunity to move on to the next stage without paying the previous one and signing an act stating that you are satisfied with everything. There is no one to complain and sue. Everything is done in good faith and in a sane mind.
I don't know what kind of cambio procedure these figures have, but spending in favor of third parties is alarming. As well as the fact that their registration is carried out at an early stage before the debt arises.
In general, there are many synonyms and possible conflicts in international bill law.
To put it mildly, I do not recommend signing such documents before the actual financing.
You have to pay for everything in this world. And for gaining experience, too. Even this one. I'll try to save you some money.
Don't let yourself be thrown. To determine who you are dealing with, in 90% of cases you do not need a private investigator. You can handle it yourself no less effectively.
What do you need to know first of all?
You should know that most investment intermediaries are not interested in making money on the result. They make money on the process. That is, if the investor would have to pay for the result (which he will not do by definition), then the applicant pays for the process (less experience, more naivety).
The most important definition. If you are asked for money before the start of financing, this is an obvious divorce.
By the way, it should not be confused with the actual amount of work, such as pre-investment research and business planning. For example, BFM Group. We never, and under no circumstances, promise anything to anyone. What are we doing? Estimation of estimates, bribes, cost, fixed costs. Construction. Engineering. Marketing planning. Then we make a business plan. Then – support. Moreover, we answer with our heads. And this is not an advertisement.
We could earn twenty times more doing what all these scammers do. We don't do that. And I, as an owner, sincerely believe that a good name is worth more than any money in the world. Point.
So, about money. What should you pay attention to before paying the first payment to an outwardly cool representative of the investor?
Scout it on the Internet. As they say nowadays, "if you're not on the Internet, you don't exist." Should be interested in everything. To do this, enter the name, phone numbers, e-mails, surnames and names of managers in the same Google. Use the advanced search. Analyze any information found. If you find any other contact details in the process, look for them as well. Repeat the same in Yandex. These search engines have different search algorithms. Therefore, some resources banned by Google may be found in Yandex. And vice versa.
Beware if you are offered unsecured financing at 5-10% per annum in foreign currency, but at the same time they tell you about conversion to the national currency at the rate of the Central Bank / NBU. Scammers may be at odds with mathematics, and they may not guess about the margin between existing deposit and loan rates. Restrictions on unsecured lending by an authorized bank also often fall out of the competence of intermediaries.
Be rigidly interested in funded and implemented projects. Ask for the contact details of the managers of these projects. Check these contacts online. If you try to hide information, turn around and leave.
Pay close attention to the style of correspondence and the manner of communication of your opponents. The excessive abundance of English-language "corporatism" indicates that you are not looking at investors, but young amateurs showing off. Ignoring the basics of office work and the ethics of correspondence says the same thing.
Communicate and schedule a meeting only with managers. It is not appropriate for you, the project director, to discuss the nuances of investing in the construction of a plant with a 20-year-old girl who does not know basic banking operations and legal terminology.
Feel the interlocutors. If you don't know how to read between the lines, calculate tension and vasomotor activity, catch omissions or stutters, pauses on uncomfortable questions – go live for another 10 years, and then come back again.
Pay attention to what package of documents is required from you. There are uniform rules and the same financial laws. The lender/investor always needs comprehensive information about the borrower and his business. A description of the project, high-quality marketing research, and a financial business plan are required. Together, all this is called a business plan. If they do not pay attention to any of the above - you are being bred.
When discussing the project, watch for reactions and expressions of interest in the details of the project. No specialist will ever forget about the legal component or tax payments.
If you are in the subject of all aspects of your business, you have the opportunity to conduct a kind of test, allegedly forgetting about something global. If you are not corrected, shake hands and say goodbye. You are no longer on the way with these people.
Portal "Eternal youth" http://vechnayamolodost.ru04.05.2011