Leadership Grants Organization: Oh, the sweet smell of a scam

In the last several weeks, I've been contacted directly by no less than six or seven people who have submitted--or are considering submitting--applications to the Leadership Grants Organization. It makes me realize that I really should have shared my conclusions about this organization much sooner. So below is the breakdown of the research that convinced me AGAINST moving forward with the grant application process. (Those of you whom I've e-mailed directly will recognize this!)

As you know if you've read previous blog posts, I was initially thrilled when I came upon the Leadership Grants Organization website. It's extremely difficult to find grants for which one is eligible as an individual, and I thought this could be the solution I'd been looking for. However, my excitement was tempered with just a hint of suspicion, rooted in the fact that the only mention of actual grant recipients was a list with first names and last initials. No press releases, no links to winners' websites or projects--nothing. I've worked in publicity, and it seemed extremely strange to me that the organization would choose not to promote its work or that of its grantees.

So, first I found the site's IP address, then tried to match that with a physical address. The physical address given by the organization is on Madison Avenue in New Jersey--but the IP address is in Canada. To double-check, I did a search for the company in the directory of the Madison Avenue building it's supposed to be located in and couldn't find anything. Then I found the owner of the IP address: Darren Morgenstern. This charmer is the founder of ashleymadison.com, which caters to married people who want to cheat on their partners with other married people (more discreet that way, I suppose). Weird connection, so I looked further, and it looks like he was investigated in 2001 (in Canada) for a domain name scam. There are also accusations of a scam with a home staging teaching company he owns, but he hasn't been indicted for either (and he made some big bucks when he sold ashleymadison.com). Then I looked on BBB to see that Leadership Grants Organization has been assigned a rank of F because it was only established in April. Odd, since the website shows that some people won grants BEFORE then. Also on the BBB site, I saw that a Sarah Morgenstern is listed as a chief operating officer of the organization. So I thought--wife of Darren Morgenstern? Either way, this wasn't looking good, but I couldn't figure out where the "scam" would be. I did some MORE looking, and found that there are people complaining online that they paid between $2700 and $4000 to an "outside business plan consulting company" that Leadership Grants Organization had recommended--but these people had never (a) received help on their plans or (b) heard back from Leadership Grants Organization. So I e-mailed the woman I'd been in touch with to ask directly if the site/organization is linked to either Morgenstern. In response, she copy/pasted the contact page listed on the website, basically just ignoring my question.

As Paul and others have mentioned, my conclusion is that if people just submit their business plans, as I would have done, there would be no loss of money--just a waste of time. But I worry that it would be more harmful for those who hire this consulting company to help them create or edit their business plans. (I also did the same IP address/physical address search on this consulting company, Capital Business Service but, to be honest, can't remember the results as in detail as the ones I gave above. But they were just as fishy.)

To be clear (don't want any lawsuits here!), my "findings" are more suggestive than definitive, but they convinced me against proceeding with the organization, and I'm advising anyone who asks to be cautious in moving forward. It also seems that, at the very least, this company should be investigated by those with more resources than me to determine its legitimacy.

Have you submitted a grant application with Leadership Grants Organization? Worked with Capital Business Service? Has anyone reading this WON a grant from them? Please share your experiences in the comments, and feel free to contact me directly if you'd like to discuss this further.

And for the record, I think it's DISGUSTING and so, so disheartening that would-be entrepreneurs could be derailed by a scam like this. I hope none of you have been.

Dear Leadership Grants of America, Would You Like to Give Me Some Money?

As some of you know, I've been preparing a grant application for Pepsi Refresh for some time now. The idea behind this grant is that individuals and organizations can apply for grants of $5,000, $25,000, $50,000 or $250,000; those grant applications are posted online, and viewers can vote on them daily. Each bracket has a different amount of grantees that will be awarded each month--but here's the catch: Pepsi only accepts the first 1,000 submissions it receives starting midnight EST on the first of each month.

Unfortunately, the system has been a little flawed.

Or perhaps that's unfair. What is undeniably true, though, is that a LOT of people are applying for these grants, and the high activity level tends to make the Pepsi submission site a bit uncooperative. When I logged on to submit my grant application (at EXACTLY midnight EST), the site froze up immediately and didn't let me continue. Ten minutes later, 1,000 submissions had been received. Frustrating, to say the least, and so far Pepsi has said there's nothing to be done but try again next month. Okay, I will.

But in the meantime I've been looking into other grant opportunities. Have you ever tried looking for or applying for grants? There are a LOT of them out there, but they all have specific eligibility guidelines, so it can take a while to weed through and find the grants that are applicable to you. Fortunately, I found one: Leadership Grants of America. Wonderfully, the Leadership Grants Organization awards funds to entrepreneurs looking to start or expand their small businesses.

So, I got in contact with the organization, and just today my initial application was confirmed. The next step is to submit a business plan and cover letter no later than July 16. If the proposal meets the organization's criteria, I'll be told what due diligence items are required, and the amount of funds awarded. So exciting! And I love that I have an official deadline for when to complete my business plan. Hey, I'm a writer--I like deadlines.

I'll keep you posted!