A couple of years ago, I was briefly involved with Pitch@Palace – Prince Andrew’s initiative to link up fledgeling businesses with investors. On Friday, the Duke of York quit the project following a wave of criticism surrounding his connection to Jeffrey Epstein. But from what I saw of the scheme, the Prince has more questions to answer than just those arising from their friendship. Pitch@Palace appears to have been a vehicle for Prince Andrew to enrich himself at the cost of the hardworking entrepreneurs he claimed to be helping.
In 2014, I was invited to a networking reception at Buckingham Palace. The event was part of the Digital Nations initiative, an international network of governments looking to use new technologies. To this day I have no idea why I was invited. I’ve built and sold quite a few technology firms over the past two decades but this was completely out of the blue.
I enjoyed meeting some very senior foreign dignitaries from countries like Korea and Estonia. They seemed just as bemused as I was to be there. After pitching to the guy from Korea, I was met with a grim silence and an expressionless face. My embarrassment was somewhat tempered when I discovered he didn’t understand a word of English. So far, so weird.
Afterwards, I was invited to take part in a Pitch@Palace event, the Dragon’s Den-style business initiative that the Prince has just resigned from. I was asked to fill out an online application.
Now I’ve been in the world of business start-ups for a while and I know there are a few shysters scamming less experienced company founders. One of the obvious red flags is when these people ask for money in return for the chance to pitch to investors. Potential investors will always want to know more about your business so will happily pick up the phone, while most other founders will gladly tell you about people they know. And start-up incubators usually have investor contact lists that they willingly share. There is no reason to pay to pitch to investors; it’s simply predatory on the part of the organisers.
So I was surprised when reading through the lengthy terms for Pitch@Palace that the project was asking for equity from firms that managed to win funding after the event. Bear in mind that the scheme itself has been funded by big business sponsors like Standard Chartered and KPMG. They clearly didn’t need the cash. Somewhat cleverly, the project wasn’t asking for money upfront, that would be too gauche I guess.
Buried in the form, the contract explained that Pitch@Palace Global Ltd (the Prince’s private company, not the charity) was taking two per cent of your business for zero cash.
This is absurd beyond belief. An early-stage technology start-up can easily justify a £500,000 valuation if they have some good people and a bit of tech, so that’s like giving away £10,000 before you’ve even started. And £10,000 for a few investor introductions is scandalous.
Worse still, if you raise another round of investment in the following three years, the conditions make clear that you’re still tied to the Prince. This section of the contract has now mysteriously disappeared after The Telegraph reported the story on Friday.
But the question remains – what on earth was a member of the royal family doing using his status to take from early-stage start-ups for essentially nothing? I, for one, am out.
Rich Wilson is an entrepreneur and has built up companies including an AI-driven hedge fund and an audience research firm specialising in the music industry.