This is a very bad idea for exactly the reason you gave.


Also, never borrow money to pay dividends. By definition, a dividend is a distribution of a company's earnings.
Not a distribution of a company's debt (loans).
Only pay dividends with coins made by the company.

Here is what others have done to help jump start:

Before the IPO, offer shares at a discount off the IPO price. Example. Your shares sell for .15 so you could have offered investors an opportunity to purchase at .14 per share. Perhaps even a better discount for multiples of 100 shares. It brings in less BTC but it can really jump start a new IPO.
Unfortunately, the IPO trigger has already been pulled so doing this is a bit more difficult.

You can still do this. But you would have to take down most of your 49K+ ask wall in GLBSE.
Next, advertise here in this thread that you plan to offer shares to investors at some discount.
Set a deadline date. At the deadline, pay a dividend to the existing shareholders for the difference.
For example, if you offered .14 per share and investors on GLBSE already bought in at .15--give them a .01 special dividend.

Once you have offers for share, you can use the GLBSE asset transfer feature to distribute the shares.


No matter what you do, make sure you have your revised mining plan posted in the OP.
Make sure you explain your "special sale of shares," if you want to do this, in the OP as well.

Since this is a company then my statement in the other thread still stands. Sell the company, equipment (and your founder shares) to someone who wants to take over. Or motion to liquidate equipment and distribute all remaining BTC to the shareholders.

The other "out clause" is only needed in a perpetual bond.

That's another thing that needs to be more clearly defined on the asset page and in the OP.
Is BAKEWELL a bond or a company that issues stock shares?

I think you are setting this up to be a company with actual stock shares--in which the investors (shareholders) own a piece of the company, and it's equipment. But I just want to make sure this distinction is clearly defined as it is an important one.

And 4 months instead of 4 weeks.

Hello again. I am enjoying this discussion.
I am also being hard on you because I want BAKEWELL to succeed.

I didn't mean to step on your technical knowledge, but running a company is a new thing for you, and it has its own perils and pitfalls.
Also, running a mining rig that thousands of shares rely on for dividends is way more involved with the personal mining that you have been doing.
When you start mining "this big" you have to consider stales/rejects much more carefully. Things like lost packets, and ping times to the mining pools actually become an issue. As a gamer, I'm sure you know what I'm talking about. This also leads to making sure you have a very stable internet connection from the rig to the pool.
Every little problem gets amplified at this large scale. Just one hour of any downtime is significant. These are just some of the things to be considered.


You can still loan personal rigs/coins/whatever and charge 0%. The principal would still need to be paid back but I would suggest using the "maintenance/growth" shares for this.
As I understand it, you have 100K shares broken down into 3 categories:

• 20% Founder Shares -- Your personal profit
• 30% Maintenance Shares -- For maintenance and growth of equipment
• 50% Public Shares -- For the rest of us

I see no reason why any loan can't be paid back using profits from the maintenance shares--especially since you are using it to grow the equipment. This is exactly what its for.


You can still keep your 20-30-50 ratio by selling 5 common shares, and then activating the 2 founder and 3 maintenance shares.
By activating, I mean all unsold shares--and corresponding "unsold" founder and maintenance shares should not receive dividends.

Holy shit! I can't believe you just cursed... and in your own thread!   


I don't mean to sound like a dick either. I'm also just being honest with you. Constructive criticism and all that.

My whole point is:
You already say you want to buy a BFL ASIC rig and that's great. Until that happens we investors make nothing. You joke about NYAN.A being paper bullshit, but it is paying real CPA insured dividends right now.

This is what you are competing against. That's right, you are competing against all the other assets. So you have to prove why you should get our BTC instead of someone else.
As an investor, I look at GLBSE and see BAKEWELL and NYAN.A or COGNITIVE or any other mining asset and I have to calculate the risks vs the rewards... and I see no reward from your asset.
The only way to profit from your asset--as it stands with waiting until all share are sold--is to wait and buy the last shares. In the mean time, this mean no shares are sold, because everyone is waiting to be the last.



I like the idea. Taking calculated steps toward the goal instead of waiting and making a huge gigantic leap.

I would still recommend to go smaller (say 150 BTC) and here's why (Watch out... more "honesty" incoming):

• You are new to this board, and although you have perfectly identified your real life self... I don't know you.
• I don't know if you know how to handle a mining rig and how to get the most profit from it. I say this because you asked for shareholder advice on where to mine--and to be frank--this is something a mining operator should already know.
• In other threads, you say you are new to all this
  
  Quote from: ianbakewell on September 04, 2012, 08:57:44 PM
  Fair enough I am new to this....
  

I would not invest until you have a clear plan. You need to show how you can get some return from my BTC.
Start very small... Get a rig with one GPU going. Show how you plan to use it, and when you can get a return from it. And when the investors can get their return as well.
Once you do this, this thread can get much more active with all the positive returns.
But you may have to dip into you own pocket to get things going. This can be either BTC or rigs you already own. AKA, a loan from yourself to the BAKEWELL asset. This is perfectly fine as long as everything is clearly documented.

Once you get things started, more investors will follow. And... be nice to fund managers, they usually have bigger pockets than individual investors. 

My trade fees show up in my portfolio the instant the screen refreshes after a trade.
If you pay no trade fees, I would like to know how you get away with it. 

I really like the open nature of your offering. I like the price.

But I got to be completely honest with you.


In your example, we can at the very least expect the difference back in 65 weeks.
Or, I can also invest my .15 BTC with PatrickHarnett's Starfish Bank OR NYAN.A and expect to have .25 in 55 weeks (rough guess).

As it stands right now, I can not expect any return in any number of weeks because there is no guarantee when ALL 50K shares would be sold.
Will all the shares be sold before or after the block reward halving? Will they all be sold by 2013? 2014? There is no way any one can know, unless you can get some big investors ready to drop the 7,500 BTC needed. And that is a tall order.


Again, with no way of knowing when all shares will be sold there is no way what the exchange rate will be at that time.



The bottom line is: You need to have some kind of return for the investors and you need to be able to tell them when to expect it. Without that information I fear you will never sell all the shares.


As said in an earlier post, you are not the first one to do this... so this is how others have done it:

• Buy equipment as shares are sold. This is not always ideal, as you have to purchase a little at a time over a long time. But it does produce coins that can be paid as dividends. COGNITIVE, BTC-MINING, and NASTY do exactly this... by buying FPGA singles from BFL with the intent on taking advantage of BFL's ASIC exchange program. You said that you would use GPUs to mine. Why not start with that?
• Take the proceeds from current sale of shares and invest it in something like NYAN.A or Starfish to get dividends that you can then re-pay to your investors. Once all shares are sold, cash out and buy the equipment. The downside to this is that you would have to clearly explain this process in the GLBSE asset and/or make a motion to invest current funds in this way.

This is what a motion is for. Raise a motion to sell the asset (hopefully at a nice profit). Shareholders like profit, motion passes, everybody wins.


But something like this did happen when ASICS were first announced. Although this wasn't done by an issuer, all mining assets tanked.
Even Gigamining was down about 50% AND stayed that low for over 2 weeks. If gigavps really wanted to, he could have taken advantage of the clause at that time and everything would have been "legal" so to speak. I know giga wouldn't do this, but he certainly could have.


There just has to be a better way, a better worded "out clause" for the maintainer that is fair to the investors as well. Because the scenario above can still happen (especially since the block reward halving is coming).

Something like this could work. But I would like to see other ideas as well. Does any one else have suggestions?

Great work. The dashboard has all the info I need, right at my fingertips.

Thank you for the additions to the dashboard!

I have one more dashboard suggestions that I forgot to mention in my last post:

The pie chart shows GLBSE Assets... but can we also add the Loans to this Pie Chart.  Then we can call it "Total Assets" or something.
This would easily show that Loans make up about 3-4% of the total assets in the fund.

Knowing the percentages of each asset (including the outstanding loans) can help investors better assess the risk profile of the entire fund.

Yes, you are absolutely correct. It is the perfect escape clause for the maintainers of the assets that would leave the investors holding the bag.
I also agree that this clause is ridiculous and needs to stop.

As it is right now (with just about every asset featuring this clause) you have to really trust the maintainer when you choose to invest.

I would invest in more GLBSE assets if they left this clause out and actually took some responsibility.

Am I to understand that equipment will not be purchased until all 50K public shares are sold? I just want to make sure I understand this clearly.
If this is true, you may have to re-think your strategy. I can not afford to have BTC invested in an asset that is not producing current dividends. I'm sure many other investors think the same way.

BTC Guild is pretty good (they even have DDoS protection) but 5% fees is steep.
I'm sure there are other pools out there, but I am not the best person to offer advice in this area.

Hello, it's looking good. Here are my questions:
When can we expect to see the first purchase of equipment and first dividend?
Where will the equipment be located? Will the equipment be insured against fire/theft/etc.?
Will you be mining solo, or in a pool? Which one? PPS rate?

First, I think the OP needs to be updated (still contains Pre-IPO info).
I also think the OP (and the GLBSE asset) needs to have a more concise category applied to FDBF.
For example: Is this a low-risk, medium-risk or high-risk fund?
"Flying Dutchman is a medium-risk Bitcoin fund," etc.

I like the Google Docs Dashboard. The information and charting is great.

In the "Weekly income and costs" section, I would like to see a column called "Dividends Reinvested" that shows the other 30% of the dividend with a total at the bottom. Its not hard to figure it out, it would be quicker if the dashboard had this info.

Also, in the loans section, I would like to see an "Amount Outstanding" column with a total at the bottom. Again, it's not hard to figure out, but having it on the dashboard would give the info quicker.

Thanks and keep up the good work.

Please add me name as well!

Yes sir, thank you very much.

NYAN.A is another GLBSE stock (or "asset") that invests in other GLBSE assets. Think of NYAN.A like a mutual fund of sorts.

Anyway, usagi was just saying that the NYAN.A administrators have purchased shares of BTC-MINING. As NYAN.A only likes to invest "in high quality mining securities, insured investment vehicles, and other extremely low risk securities" ...it was considered a compliment.

If you have less than 100 BTC on deposit, you can increase your deposit up to 100 BTC by using the same address you were already given. No need to check in--just do it.

If you have more than 100 BTC already on deposit, you will need to check with PatrickHarnett first.

What is this on a per share basis?