Beware of ‘advisers’ seeking equity, say tech investors

Experts warn that such equity arrangements would immediately make serious investors wary of any start-up that engaged in them

Pat Phelan, founder of Sisu Aesthetic Clinic and an investor in a number of businesses, said he was approached by an adviser last week asking for 8 per cent of his business in exchange for introductions to venture capitalists. Picture: Fergal Phillips

Multiple Irish tech investors have warned start-ups to be wary of “advisers” seeking equity in return for access to investors.

Pat Phelan, founder of Sisu Aesthetic Clinic and an investor in a number of businesses, said he was approached by an adviser last week asking for 8 per cent of his business in exchange for introductions to venture capitalists. Phelan, who sold Trustev, his IT security business, for €40 million in 2015 said this is ...