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But I think the worst scammers are those that operate in a semi-legit way. They're actually out there, in person, trying to raise money for some product which m

But I think the worst scammers are those that operate in a semi-legit way. They're actually out there, in person, trying to raise money for some product which may work on a fundamental level, but that does not mater, as they have no plans on developing anything. Maybe they have legit experience from before, and even have serious people that can vouch for them, if needed. They put together startups, have a couple of good months, but then go back to regular programming of funneling VC money into their own account, while starving out their startup. Then when the startup goes under, they disappear, only to resurface a year or two later somewhere else. Probably with a new name or alias. They almost never go for the real big fish / tens of millions, or even millions - but just enough to live a cushy and flashy lifestyle. Nice leased penthouse, cars, etc.

fortran77 7y ago
I get the feeling that it's easier to raise money for some vaporware, and then have fun for a couple of years with that pile of money than to spend a couple of years self-funding something that actually works and trying to find a buyer.
- jacquesm 7y ago
  The more frustrating version: you work hard and self-fund for a couple of years to make something that works. Then along comes clueless bunch 1.0 who are bankrolled by clueless VC who then undercut you on price, over promise and do not deliver leaving you with potentially years without sales because you can't match the hype train. I've seen this a couple of times and it isn't pretty. By the time they finally go belly up you may have preceded them down that path.
exclusiv 7y ago
Totally agree. I came across a few of these over the years. Entrepreneurs that have done 5-10 companies in the past and none succeeded. They always raise money and fill their coffers and their friends' too. They stiff good vendors. Because if you can get real work done for free, it gives them the optics of having created something but they still have more money to squander before it goes belly up. And when the company closes down, unless you can prove fraud there's no recourse. In the movie Goodfellas they articulate it well - obtain the goods on credit, move it in front door and sell it at a discount out the back. It doesn't matter. It's all profit! Then they even light it on fire and collect insurance money.
- TrackerFF 7y ago
  Here in Norway they have a name (to the Goodfellas ref.), in the lines of "bankruptcy jockeys/riders", meaning that they ride companies into bankruptcy. They are especially rampant in construction, where it's easy to get bank loans, by showing contracts and won bids (which are won by aggressively undercutting competition), and inventories can be flipped with ease. We do have laws that essentially gets them banned from owning companies, if they pull that off too many times - but they easily circumvent that by just persuading friends and family to start companies on their behalf. It's a scummy business.

fortran77 7y ago

I get the feeling that it's easier to raise money for some vaporware, and then have fun for a couple of years with that pile of money than to spend a couple of years self-funding something that actually works and trying to find a buyer.

jacquesm 7y ago
The more frustrating version: you work hard and self-fund for a couple of years to make something that works. Then along comes clueless bunch 1.0 who are bankrolled by clueless VC who then undercut you on price, over promise and do not deliver leaving you with potentially years without sales because you can't match the hype train. I've seen this a couple of times and it isn't pretty. By the time they finally go belly up you may have preceded them down that path.

exclusiv 7y ago

Totally agree. I came across a few of these over the years. Entrepreneurs that have done 5-10 companies in the past and none succeeded. They always raise money and fill their coffers and their friends' too. They stiff good vendors. Because if you can get real work done for free, it gives them the optics of having created something but they still have more money to squander before it goes belly up. And when the company closes down, unless you can prove fraud there's no recourse. In the movie Goodfellas they articulate it well - obtain the goods on credit, move it in front door and sell it at a discount out the back. It doesn't matter. It's all profit! Then they even light it on fire and collect insurance money.

TrackerFF 7y ago
Here in Norway they have a name (to the Goodfellas ref.), in the lines of "bankruptcy jockeys/riders", meaning that they ride companies into bankruptcy. They are especially rampant in construction, where it's easy to get bank loans, by showing contracts and won bids (which are won by aggressively undercutting competition), and inventories can be flipped with ease. We do have laws that essentially gets them banned from owning companies, if they pull that off too many times - but they easily circumvent that by just persuading friends and family to start companies on their behalf. It's a scummy business.