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Since i highly underestimated the amount of work and potential stress of a groupbuy i decided i will create a post for everyone who goes with the thought of starting a groupbuy on its own. I will describe what you have to await so you see this more correctly.

Firstly, i started a groupbuy for avalon asic chips Generation 1. Our groupbuy bought 5.6 batches, totaling 4816BTC. We had exactly 300 members involved.

The first thing i thought is that it wont be much work. The biggest work will be the packaging of the chips. Highly wrong. In fact the packaging is something that can be done in a couple hours. Which is a tiny fraction, not even worth to mention. But a groupbuy will mean to you work of 2-6 hours each day, 7 days a week and for me now unbelievable 4 months long (didnt notice this till now). Very seldom only 1 hour a day. You have to stay in contact with your groupbuyers. Nothing is worse for the situation than a groupbuy organizer that doesnt get back to the members. You can await that very fast rumours appear and fears lead to a doom loop that goes in a direction no one wants. Im sure you saw such groupbuys already since there are groupbuys of all kinds on bitcointalk.

Saying that... support is the biggest part of work. Up to 100 pm's each day are common most of the time, if nothing happens for some days you might only get around 20 a day but its seldom. Luckily i can type machine so im fast writing. If you cant it might take you even more time.

You need to be able to maintain a correct dataset. In my case i used a calc sheet of open office. Calc can greatly lower your work amount with automatic formulas and so on. For example i let calc create automatically forum topic, status text and order tables in bbc-code. It would have been a hell of a lot more work otherwise without this help.
Keep sure this data is protected. Backups is something you need very much since you deal not with your own money, its others people money. Even when you dont make backups for your own, at this point you have to when you dont want to risk real trouble.

Before starting a groupbuy make a set of rules. Its easier for you when you can point to explainations this way and it makes the rules clear for both side. The same goes for the fee you take, shipping cost and so on.

You need to specify refund rules. This topic will appear for sure and you need to be prepared. And according to my experience it might happen that everything stops for a reason you cant change and everyone wants his bitcoins back. Its best you have a rule prepared for that case so that you dont sit on the costs and work you had.
If something goes wrong (miner arent worth much anymore because of difficulty rise, seller did something wrong) and you werent fully in contact then await to be the one that was the reason for the problems. My members didnt say that luckily and i constantly was in contact but there might be others outside of the groupbuy that dont bother if you did it. Be prepared to be the one that lured them into buying and planned everything to scam in order to earn money. They simply search a scapegoat because some people cant simply search the error in their decision. It probably cant be changed since you cant be everywhere in each forum thread. So better stay in touch to prevent the doom loop i mentioned above. You dont want get this developed in a shitstorm without real base.

Important point... dont underestimate the legal problems. If as private groupbuy or as a business, the rules are different but there are possible problems that can really make you trouble in real life. Keep sure you thought everything through. I wont go into detail though. In case you want to start a groupbuy and want to know what i mean ask me via pm.

If youre unlucky you have a seller that isnt communicating. That doesnt only bring you much stress because you are the connection between your members and the seller. You get all the possible anger so you can transfer it to the seller. And what do you do when the seller isnt reacting? You collect this in form of stress. In my case i then started to try every way of contact and had to put a lot of time in it. At the end i had to give up realizing there wont be an answer.
I only want to warn you that this can happen.

It might get even worse. What if all was a scam? When the seller took the money and ran? Im not a lawyer but you better didnt do this as a company but instead as a private person that only ordered with its friends a bigger thing. Otherwise you would be the one taking all the loss. But like i said, im not a lawyer, maybe im wrong.
You might even think of rules regarding the case of scam happening. Its always better you have something to point at in case something unawaited happens.

Shipping, like i said, is something that doesnt really cost much time. I didnt ship the actual chips but many shipments with sample chips. Its not much time involved compared to the real time. You might use electronic stamps to speed up the process or similar things.
While we are at shipping. If its special hardware you need to make sure you can provide correct shipment. In my case buying pakets, antistatic bags, antistatic workplace to not hurt the chips, bubble foil and more. Be prepared since most probably time isnt something you will have much when the products were delivered to you.
I had to search a import company to solve some potential problems. To make sure that it will run correctly i travelled to the company and signed a contract to make sure i dont risk the bitcoins of other people because otherwise it would have been my problem.
I only say this to tell that such unawaited things happen too.

Next thing is information collecting. In case you need more infos, for example email, billing address, refund yes or no and so on, you have to collect them to move on. I had to do this several times. If you need that info its not enough to make a post. The response will be very low. You need to create pm. You can send 20 pm with one pm. For example let calc create you ready made lines like "username", "username2", that you can copy into BCC(Blindcopy)-Field so that no other member see the other receivers in case you offered anonymity of some kind. Theres a 120 PM limit per hour at the moment. Only if you do this you can hope to get the needed info in the next days. But even then you will miss 25%. Those remaining infos can come in slowly in weeks or months for mostly good reasons. Sometimes you dont get it at all.
But you will have again much work with it. Especially when you need the info to move on and have to remind often.

My personal result of the groupbuy i did is... my wall to break to do something like that again is huge. The reward is not even close to the stress and work that has to be done. Its really a full time job like someone said before. Luckily i was able to stop my normal work for other reasons, so i found this time. It would have been not be possible for me to do this properly otherwise.
A good result is on the other hand that people learn to know you. After you did this they know if youre trustworthy. Since trust is everything in bitcoin + the Net this is something valuable for sure.

I hope i could help someone with my experiences who thinks about making a groupbuy. ;)

As one who was considering starting a group buy I can say this has probably saved me exponential amounts of headaches.  

I was lucky enough to ask questions before starting anything and SebastianJu is very professional and helpful.  Most group buy starters are very open and will answer questions.  As stated above these guys have to respond to hundreds of PMs a day so it may take a few days, but I have always heard back.

Keep the community and the hard work shown from the Avalon buys in mind is what I have concluded.  I may still perhaps start a group buy if the community seems to back an idea.

Thank you SebastianJu. I've thanked you before previously for your service (which I've never even used) and I'm thanking you again. I would add that SJ's Group Buy is a bit more ambitious then most GBs. Not every GB is going to have hundreds and hundreds of buyers to keep track of.

I would also like to add that most of the stress that took a toll on you and the other Avalon GBCs is *NOT* your fault that a formerly reputable forum member went AWOL on you guys for months. You guys went in thinking you were doing business with Dr. Jekyll and you ended up with Mr. Hyde.

Part of the risk of organizing a Group Buy is deciding *who* to organize a Group Buy FOR. This mfg? That mfg? A pool of mfgs? We all have to do our own homework & come to our own decisions with our time and our spending power. This decision could play a role into whether your GB even gets off the ground.

I, for one, will NEVER do business with BFL again or Avalon due to the words and actions of their primary stakeholders.

Also, for anyone reading this, I specialize in helping new Group Buy Coordinators succeed in completing their Group Buys. Like anyone else, I can't do much about mfg. delivery but at least I can help you succeed in ordering your equipment.

After having experienced all this myself with only 18000 chips ordered, I second every single word of Sebastian on his post.

 

Thanks for taking the time to write this up.  Some very valuable information for those who are thinking of doing this.   My hats off to you.   I think you also need to add , GB organizer must have patience of a Saint.  LOL I would tell most of the drama queens doom and gloomers to take your BTC back and  F**k off .  ;-)   Hahah Not a good trait to have for customer service.

This is why I backed out. I decided to partner up with some gentlemen that can better handle certain aspects of the buys (admin etc) and concentrate on the hosting side- so I can concentrate at what I am good at and what others are good at, in exchange for a smaller share of the "profit" so to speak. To be honest the whole bitcoin deal is a rush for me so I am excited just to be a part of it.

The wait time on my group buys are usually less than a week and it's insanely stressful making sure everyone is informed... I couldn't even imagine handling a single group buy that lasted 4 months! :(

Sebastian really does offer up an epic case of group buy.  Perhaps his stress can be shown as the optimal case of a hard working GBC.. (and to be fair other big GBs for avalon like Zefeir did awesome too from my understanding... these guys know a thing or two more than me), but realistically we may never see that high of stress again.. or at least hopefully, not for awhile.  ;D

I think a Group Buy of SJ's size and duration should only be taken on by the most ambitious GBC, preferably with a core group of 2 or more people. I don't think a GB of your size/complexity should be undertaken lightly by anyone.

Seeing the size of those chip Group Buys, for comparison's sake it took 14 other buyers & shares purchased by myself to purchase 40 shares for a HF BabyJet in my recent GB, and it still took a lot of work behind the scenes to keep running smoothly. I'd say any new GBC should learn to walk before they run & *focus* on just one Group Buy of limited size/complexity/duration. There's a lot to be said about not fighting two or three front wars.

Be prepared to deal with distrust and a lot of time spent educating others and answering questions. Also, look at yourself honestly and ask how well you deal with customer service and teaching others.

- How will you handle concerns about BTC handling and for miner rigs: miner payouts later on ?
- Hosting details? Everyone kosher about where the hardware is going?
- How will you deal with refunds? Do you have funds set aside for this?
- Will you have co-admins in case you get hurt/incapacitated or if there's concerns about fraud?
- Are you willing to risk your time, your job and your freedom to give Group Buyers the world's best prices?

Sebastian shows that it is possible for one person to manage 300+ people,

And you have to factor in all of the complications that the original company offered for all of those really coordinated people like SBJ.  They were able to take a largely fractured buy (things only got more complicated when people started freaking out about ROI and sold off GB purchases to others.. this was good actually since I got a few chips this way as a developer), and were able to reasonably talk to all of their friends that bought with them through the whole struggle to the final resolution of refund or no refund.  

I just don't think those terrible courses of events shall play out for awhile in the BTC community.  Or I'm just hopeful.

Either way these group buy leaders for Avalon show'd greater face than the company they were buying from.  Perhaps these Avalon GB coordinators could give customer service advice to some non-bitcoin related companies I can think of  ;D

reserved

Many used their meager savings in lieu of food, clothing and rents to pay for the group buys and after 4 months, we were told that chips will not deliver but getting a refund. Zefir was considerate and we wish more people like him who gave refunds immediately to those less fortunate to alleviate their suffering.

In the first place who started the group buy and who wants to make money from the group buy?? Don't blame those on your group buy blamed them on Yifu if you will.

Everyone in the group buy should get a full refund, those who are rich and wealthy can always donate to their favorite group buy mods.

5.6 batches is 5.6 x 10,000 chip = 56,000 x .079 btc each = 4256 btc x 10% = 425btc profit x $145 = $61k very good.  Were you Greedy. ? with the 61k you could buy 10 Jupiter for FREE,.

Oh eve, I appreciate the warnings you incessantly give these forums but I've actually worked closely with and talked with these Group Buy Coordinators you accuse of being evil and greedy.

Evil and greedy seems to be the furthest description of the 2 GBCs I've vetted & the new GBC I'm currently vetting. I've also gotten *good* free advice from CanaryInTheMine, waldohoover, and CoinHoarder. You couldn't be any further from the truth. You have no idea about the sacrifices of time/money/stress these GBCs must go thru behind the scenes to give Group Buyers the world's best prices. You have no idea how much work it takes behind the scenes to succeed in a Group Buy, whether you're a newbie or a veteran.

BTW, newsflash: this isn't communism where everyone gets paid the same for no effort or groundbreaking efforts. How much profit do you propose a Group Buy Coordinator should make to stay in business and prepare for the future? Should we create a committee to figure this out?

Until you've walked a mile in their mocassins, your argument holds no water.

P.S. You can't shoot the messenger in this case about being greedy or evil; if you care to dig in my posting history on Reddit, here, and even the Surfermag BB up to 8 years ago, I've been helping folks out in forum after forum for free for as long back as you care to dig (8 years worth, if you want). And if you look at the transactions in my GB, I haven't made a single red satoshi in profits from my fellow co-op members, and I set it up this way on purpose because I just wanted access to the best tech at the best values at the ultra lowest costs. That's pretty much it. I also set up my co-op as a democracy too, as I'm no tyrant.

This is me trying to give complete strangers my good paying job in paradise (at a National Lab, no less) 5 years ago; I can't make this shizz up: http://forum.surfermag.com/forum/showflat.php?Number=1369010

Well said SebastianJu.

I know in my case, with my 3% fee on seven Avalons, it is not worth the time and trouble it takes to run my group buy. For instance, I made about 9 BTC for 3-4 months of work at an hour+ each day... sometimes 8+ hours in a day. Of course, Avalon really screwed me/us over, but still.. you need to plan for delays in your hosting price structure.

Yes, it takes about a hour a day (sometimes more) to keep 100+ people updated, answer questions, update investor account information, and all issues involved with the hosting of the equipment.. it is a lot of work. If it is a hosted group buy you also have to think about share transfers, consider using an exchange to save you the headache... I do it by hand in Excel the old school way.  :(

Really consider charging a lot more than 3% which seems to be the standard norm in group buy hostings. I'd suggest 8%-10% to make it worth your while. If no one wants to participate for that high of a percentage, then don't run the group buy and save yourself the trouble.

In case I didn't learn my lesson, I am doing another group buy now (which is closed). I am just asking for it... working for pennies is not very fun. I like to think I'm providing a good service to the community (which makes it all worth it in the end.) If it wasn't me doing the group buy, it could be some scammer, so I would prefer I do it and everyone not get scammed.  ;D

Unfortunately for me, my Avalon group buy stopped short of about less than 60 BTC. Had to refund everyone. I got into a private group buy and that is much better handled considering a lot less members. But we're still going for a refund now instead of waiting for the chips.

The good news is, for me, I avoided all the potential stress and head aches and heart aches and all the aches and pains.

PSA: Since it seems common sense isn't always common, perhaps *All* Group Buy Coordinators should add this disclaimer in their terms (or something to this effect):

** By agreeing to participate in this Group Buy, you agree to NOT use your money that was primarily meant for: food, clothing, rent/mortgage, short term emergency funds, car payments, insurance, 401(k), IRAs, or children's college funds. These are considered HIGH RISK purchases of hardware, with funds tied up for weeks, and are NOT meant for those trying to "get rich quick." **

THANKS A LOT for writing and sharing that Sebastian!!! :) Really a good and impressive work, well done!!! ;)

Kind Regards!
-anykeywhy-

MY BIG KUDOS!!!

ctrl-c'ed + ctrl-v'ed THX! ;)
&cheers!!

Thanks for the laugh. But yes, it looks like that is something needed in red. Even though i wonder someone whose money nearly was completely lost, now got nearly all back and then needs the small rest now so badly because the childs dont have a meal anymore. Doesnt match. And i could wonder why eve is protesting when he dont even is a member in my groupbuy. By speaking about that... im really glad that everyone in the groupbuy was ok with me keeping a bit for my work and the cost that were created.

Good post  SebastianJu

I agree 100% with everything you mentioned.....

My  learning experience has been priceless however, would not  trade it  for the world.

I would personally like to thank all the contributions in my GB's(financial, guidance), and the friends and experience I have acquired along the way

Cheers

That is one cool outcome of it that I didn't expect, I met some new friends. It is kind of cool how you all go through the same process and have people to debate with and complain with (in Avalon's case), and in the end it kind of brings everyone together.. like bonding with your family! :)

Me too! I was surprised by that as well. I have a feeling that I'll be friends with many of the people in my co-op for years. I think Group Buyers as a whole are an optimistic bunch (perhaps a bit too wide eyed when we start off) that see the glass as half full, so it tends to attract the same type of people with similar risk profiles.

====

Since we're talking about best practices and things to consider when setting up, I'd like to add this BTC Currency Volatility Protection Model that trout & I came up with during my first GB for consideration; this may have been the first of its kind on the GB forum:

- EDIT: 1 BTC is being valued at $100 USD for this transaction. Since BTC is volatile, if 1 BTC is worth $120 or more (Blockchain value) at time of purchase, I refund you the difference! [Tip o' the hat to trout]
- ADDENDUM: This BTC currency volatility protection does not apply for ebay/PayPal shares.

Of course, you use the current value of BTC at the start of your GB instead of the $100 I have here (you know, in those ancient days when BTC was about a hundred: AKA last month). You could also use another exchange's price, of course. I'd also like to add if BTC *drops* 20% in value by the time your GB ends you're gonna be SOL unless you also included some sort of disclaimer that everyone has to chip in more or the GB disbanded if the value dropped 20% from the start of the GB.

Just a suggestion, but it's meant to CYA, mate! It's also fair to the Buyers if BTC appreciated over 20% since the start of the GB.

It depends on the particular Group Buy. If the manufacturer or supplier is pricing their items in fiat or in bitcoins. Avalon chips are priced in bitcoins so the value of each BTC does not affect the Group Buy. Others, like BFL and KnC use USD as their base and just convert and accept BTC.

Great point! In our case, HashFast priced their unit in USD, so trout had a valid point that the GBC can profit unfairly just from a rise in BTC over the course of the GB.

On the other hand a GBC could lose too this way. So i think its best to find a deal with the hardware supplier to buy for a static btc-price or the gbc makes a rule to pay back or collect more btc when the price makes it needed. Maybe easiest way is to collect a bit more from the start and then pay this back or use it partly for shipping and then pay back the rest. Something like that. I think a GBC does not want that the members feel treated unfair. That takes out much fun. When rules are there then the member can take part or not, so its best to think about everything before.

Very educational Sebastian, I didn't participate in your group buys but was very impressed with how you handled everything.

It seems Avalon is beginning to refund some of the chip buys. Kindly check if you have bought chips from Avalon if you got a refund already. It's a relief to see 782.1 BTC in my wallet after all this time.

And keep sure you dont fall for a scammer and you dont answer happily "yes, refund" since someone put in his address... i didnt fall luckily otherwise i would have lost 2 batches refunds.

Oh? So some scumbags tried to get you to issue a refund when they didn't even order? Weak.

Care to share the names of these obvious miscreants so we know who to watch out for? Perhaps a thread in the scam accusation forum is applicable.

Keep in mind the top scammers on the scam thread are those that have had higher trust ratings than anybody here... If I spent 6 months to a year building hero status and suddenly found myself able to peace out on hundreds of thousands of $ in BTC.. well I can think that I wouldn't but what would you do?  Maybe none of us know what we will do when we are in charge of those kind of assets.

Gah! I don't understand that scammer mentality. You can make just as much money - if not more - working legitimately without having to look over your shoulder for the Police all the time. I'll never understand that. Scams take a lot of work too in most cases; might as well make your living by not pissing people off & tempting karma!

If you're hosting the units yourself and not on an exchange. This is an easy way to pay dividends: https://github.com/csjones/sharebitcoins

Holy crap your awesome.
The first $$$ I make from hosting using that you get a tip for, and the developer

Nice script. Would work with coin refunds too it seems. How safe would the private key be?


Yes i know who it was and i was in contact with him already. Its a pity since its someone i worked with and trusted not a few till now. He obviously forgot that he tried to use the address he used for trying to get the refund already in the forum. Since the deal didnt happen the address looked unused. Thats why he used it for the refund form most probably. Thats why i know who it was and made pictures to prove it.
I really dont know what to do. It was a saturday... it might be he was drunk or so... i dont have a clue. I wrote with him on that saturday and he wrote things like that i should refund all 5 and fly to thailand with a shirt "IAM RICH,BITCH!"... and he didnt give a real explaination why he did it.
I would destroy his Identities on the forum so im really unsure what to do since till now he was always reliable. Man, why did he bring me in this situation...

Yikes! I'm sorry to hear about that complication.  That's the risk we all take when we're dealing with Customer Service; never know if you're going to get that so-called 1-3% of society that are mentally impaired or damaged. They deserve our empathy and compassion but it makes for a difficult situation if you're a Seller. That was a Dave Chapelle reference BTW if you were unfamiliar with it.

Two things I can think of:

- Sounds to me like someone was on a bender in Asia! The Hangover: Part 3.5!
- Maybe he's just off his meds right now.  ??? I've known people that suffered from bipolar disorders that made them act this way when they refused to take their meds (says it makes them lethargic).

I'd stick to the deal, whatever it was. That's just me personally. You don't get to handle the payroll of >200 people if you can't be trusted.

This...it will eventually come back and bite you in the arse...I don't deal with payroll but I do deal with tens of thousands of dollars in cash a day, and every once in awhile have to count 100-250k.

Well, OPs post definately made me not want to conduct a group buy! We always need more group buys in Australia

I actually started a group buy with Sebastian's offer of escrow in a safe manner.  Nobody wants to group buy with me.  Maybe it is just me.. or maybe it is getting harder to soundly invest in any of the hardware we are being presented.  There have been issues from previous ROI fails so I had to offer no security rather than promise on pre-orders again.   

Honesty and trust are shown awesomely in these threads... yet I feel we can't trust ASIC devs. Maybe they just stop caring after they are presented with all of the pre-order profits/ being able to hash faster than anyone else on your newly printed test ASICs.

I think the only way to get hardware that will break even in the next months will be to have an Asic Design and produce miner at cost.

A lot of the work comes from the fact that many of you have no or very little restrictions regarding the minimum investment. If you choose to deal with 100's of of tiny investors, what do you expect?

Thats correct. Thats why burnin (The bitburner developer) now decided to only do B2B anymore because the work involved is too much otherwise.
But a groupbuy has the purpose to allow small buyers to buy. Of course one can raise the minimum but when i see into my list there werent very often chips bought below 20 pieces anyway. Of course a 1000 chip threshold would have helped a bit but its not much better than the 10K threshold avalon used then.

Hate to say it, but that's where gentlemen like myself, waldohoover, CoinHoarder, etc., etc.. help fill in the niche of those looking for complete hardware even if they don't own the entire device. The sad fact is that the very best values are only found in the most expensive hardware, for the most part; hence: Group Buys of single expensive miners for those adapting to rapid network difficulty growth. Group Buys are for those willing to take fractional risk on a number of strong bets among ASIC mfgs *and* Group Buy Coordinators. Those willing to be GBCs better have a lot of patience, be good at selling, customer service, education, and handling refunds and concerns.

When I became impressed by HashFast's Miner Protection Plan & value at the time for B1, I could buy about 1/3 to 1/2 of it so I didn't want to pay share management fees since I would own a big chunk. That's why I, personally, out of the blue decided, hey, running a Group Buy shouldn't be too hard! That was about Aug. 13-14 (I hope I've gotten better at things on my 2nd round for a Group Buy).

For my first real GB attempt, I quickly figured out that the only way I could compete and make a mark was if I offered rock bottom prices with some sort of guarantees in place for miner payouts. I also figured out that the only way the little guy could compete was by us banding together via trusted members so we can collectively get the best prices, technology, and values. My small co-op, which I had no intention of expanding 3 days ago, is currently at 19 members, so there's much less of us to keep track of, so far.  :)

=============================================================================================

I also offer services to smaller custom hardware manufacturers who do Group Buys here, like Barntech, for example, to help offload Customer Service and some marketing to people like me, who are hardware neutral, and advocates for both Buyers and Sellers. I'm able to see things from both perspectives having been in both roles.

I'm naive enough that well over a month ago, I even offered to help dig Yifu (offer sent via PM) out of his hole via Customer Service (AKA as uberfast refunds and sincere apologies to pissed off customers) when he came out of so-called "mafia" hiding and still had some semblance of a chance of salvaging his name and Avalon's reputation. This offer was from someone with no horse in the Avalon race, a CSR background, and the patience to deal with angry people since I had nothing to do with them being angry.  ;D

For those willing to put the work and effort into really succeeding at Group Buys...To those willing to take risks, you can't win if you don't try! Ya know that really cute friendly girl that everyone knows but no one asks out? Sometimes they're the loneliest ones because everyone assumes they have boyfriends! Or so I've heard.  :D  ;)

Thanks to my first GB launched 1 month and 1 day ago, and my GBEC services, I've already vetted several hosts and GBCs for free, and already have a mesh network of vetted (or soon to be) vetted Bitcoin Miner Hosts available in multiple US states, and favorable possibilities to expand to Europe, the Middle East, and Asia! I had no idea I would have my GBEC services in place *and* a 2nd GB in September. I would probably have voted against such a possibility 5 weeks ago.

A new model of GB share pricing and BTC volatility protection, for both buyers and sellers.

Just thought I'd offer this for anyone that wants to use this type of share pricing on future GBs. From a PM I sent to an anonymous gentleman asking about which exchange I was using to value the USD to BTC ratio since I was pricing shares for my 2nd GB in USD instead of BTC (TL;DR: As a GBC, BTC volatility doesn't matter to me for USD products!):

"Here's another nice thing about this USD/BTC GB share model I suppose I'm helping to pioneer: since it's priced in USD, you just need to make sure that as long as you have X amount of USD or your natl. equiv. (in the range of $100-138 avail. per share) to ensure that you're getting the best price possible on your GB shares at the exact time you're ready to apply PayPal or BTC funds towards a GB; thereby allaying worries/distrust about BTC volatility on the part of both the GBC *and* the buyer!

As a GBC, I don't have to care about the ever changing BTC/USD exchange rate and variability across exchanges because you the buyer just need to get BTC in the amount that's equivalent USD value of your share(s), *when* you're ready to purchase your share(s). Since you have Coinbase, you should only be charged a 1% fee for the currency exchange, which appears to be the lowest cost & fastest method to buy BTC from a reputable source." - DZ

I think it was stickied already not long after the start. My first stickied post... :)

As a Network Engineer and having built the biggest Miners Co-op on this forum with able partners (400+ members/customers, 32 GPUs operational, and about 56TH/s of hashrate ordered, as of today), here's some more free GB planning advice below.

Don't forget to include the costs of:

- UPS and Battery Backup for short outages
- Gas Generators (Optional) if you're ambitious enough to try to protect against longer outages
- Network costs (including dual network connections preferably 4G LTE as a backup, if possible)
- Electricity costs - a not unimpressive amount, depending on what you're running and where
- Cooling costs - Fans and optional Air Conditioning aren't free. A/C can sometimes let you overclock, but also drives up energy costs.
- Mining Pool costs and Management costs

All these costs add up and are not always properly accounted for by those trying to get into the Group Buys biz.

I also want to add: don't hesitate to *build* an able team. No woman or man is an island, and it's a *lot* of work to both sell, run, maintain, and troubleshoot ASIC miners, in volume.

I completely agree, thanks for your contribution DZ, your advices would be good start point for who's thinking that "one order" is sufficient to start mining! ;) 

Cheers!
-akw-

I decided January 1st to make a big move mining wise and am now running my 3rd group buy.  I've never worked so hard in my life.  You really don't appreciate the scale of things until a pallet of miners is sitting in your garage. Timing the arrival of everything needed to do a successful install is very challenging; Fry's Electronics and I are on a first name basis.  On group buy #2, half of our power supplies were shit ~ be ready to face a ton of unexpected costs.  Just managing all the owners, keeping track of who buys what and staying in constant communication is a full time job.  Your family and friends need to be supportive, and you need to build a team to work at a large scale.  It's vastly different than running a dozen miners at home; you are now accountable and responsible for somebody else's hardware.  When you go big you'll want to use 208V power for more efficiency; be prepared to pay out the nose for cables to plug into a 208V PDU.  Oh don't forget you need PDUs; get the ones that you can remote power cycle, only problem is they are over $1k each.

I haven't made any sort of profit (yet); I'm basically working for free.  It's also been one of the most fun, rewarding experiences I have ever had. 

Come Friday we'll be up to 17TH deployed, all from idea to deployment in less than a month's time.

Congrats for the success! Yes, the work involved is intense. Besides that the responsibility is something to shoulder which isnt easy when you watch the forum and see projects going down left and right. Other people start with good ideas too but then problems happen. So you hope to run everything better and try to prepare for every possible turn of events. I didnt want to get into the same place others in the forum landed when things dont run well. If something goes wrong you can save a huge amount of hate and the circle of doom when you keep really in contact and have some rhetoric skills. Nothing is worse than silence and missing information then.

Good thing people still try running groupbuys and projects knowing the risks...

Congrats MWNinja. I see that you're already in the Top 15 now at BTCGuild with 22TH currently deployed.

Sorry I couldn't help you earlier to help you organize your GBs when you contacted me when you were trying to get into the GB game; I/we were swamped ourselves dealing with expanding beyond mining ops, and a number of issues and moving to a larger facility 6k sq. ft.+...which turned out to have used fuses from 1974!

If you go the pre-order route...just know that you'll be having to not only deal with hardware that may be late or never arrive (grumble grumble) but also software: as in people both on the back end and on the customer support side. On some matters, as a mediator on some things, I've personally lost sleep and felt discomfort over how the minority was affected when votes came up for critical things.

On another note: Over the last 7 months, I've vetted 14 Miner hosts and/or GB Coordinators so far, for free. Some of them you see in threads below such as thomas_s, bobsag3, Dabs, SolarWindMiningCo., Thyatis, and others.

I'm now charging $10 BTC for my Forum Vetting services, for those reading all of these horror stories and who *still* want to do break into doing Group Buys for the community. Please shoot me a PM or contact me via Skype if you'd like to get vetted by a forum veteran with a history of doing this for the GB community.

I myself did a little groupbuy with around 15 people.
I just kept track in a little textfile who ordered what, who payed using which service, etc.
But how are you keeping track if you have hundreds of clients?
Do you use a massive excel sheet, of some other software?

Also, Do you use adress stickers or handwrite everything?

Calc(Free Excel) is a huge help. Most people dont know what it can do really.

Adress stickers printing is easier for big amounts. But thats only a very small part of the work.

another must have helping tool could be a co-worker... more heads on the same things often help, especially with high work loads!

before joing group buy check trust feedback of creator

you can be scammed and get your trust ruined...

Also read trust those entering the GB as buyers... if you don't want PROBLEMS after the fact with extortionists like bbxx and his "brother" you might want to limit people like that getting into the group buy in the first place.

Then read Bick's writing about any member and if he says NO.
Then it is FINAL sentence .
listen to this man. I recently discovered he is also even  investigating my wife.
So then he is trustworthy
:D ;)

It's almost as if a Developer should design a trustworthy group buy platform :D

You realize that the last answer in this thread was three years ago?  :D

And no, software can not really solve things.

Wow, this seems all so far in the past now. I was involved in an ASIC purchase by candoo a couple of years back but since having lost so much on mtgox I became really distanced from the whole cryptocurrency stuff. All the latest group purchases were a couple of months back.....if there´s anything going on in the near future, I´d be highly interested to take part in a new group project.

Does anyone have some news on that maybe?

I would say, stay away form the risks of cloudmining, mining groupbuys, mining ICO's or mining with your own hardware. The risks are no fun. Even self mining. You order gpu and at the end they change delivery date so "we don't know when we can deliver, sorry".

It's not worth it. Just invest in the coins you believe in.

Yes mostly it has been done because of price discounts. Sometimes also because the minimum packages were so high priced that no single individual could afford them.