SCAM IPO [Bakewell] - Finally, a 'transparent' investment that will 'grow'!

[ianbakewell]

Restored from: http://web.archive.org/web/20130305005856/https://bitcointalk.org/index.php?topic=104489.0
Please note that Ian Bakewell is currently in default and hiding from his obligations - more information see:
http://scammer-ianbakewell.com/

https://bitfunder.com/asset/BAKEWELL

100,000 shares total

50,000 public shares @ .15
30,000 growth and maintenance
20,000 founders stake

The shares will be released on a 5 : 3 : 2 schedule
For every 5 shares sold to the public, 3 will be considered active for
growth and maintenance, and 2 will be sent to my personal portfolio.
This will keep the percentages proportional to funds raised while we grow

Total bitcoin raised: 7500
Market Cap: 15000

25,000 shares will be put up on ask @ .15
25,000 shares will be available through GLBSE private transfer, minimum 100 shares.

I will be offering investors the opportunity to receive an additional 10% bonus shares on purchases over 100.
These bonus shares will be awarded to them from my founders stake as a thank you for taking the first step with me.
Those interested in a purchase of 100 shares or more should PM me. The bonus is only available on the 25,000 shares put aside for private transfer.

I will be withdrawing BTC to purchase 7970 rigs every 2500 shares sold with the goal of hashing and paying dividends as quickly as possible.
Once the first 25,000 shares have been sold, the proceeds from the remaining 25,000 will be used to place an order with Butterfly Labs for a BitForce Mini Rig ‘SC’ (ASIC)
Upon arrival of the Mini Rig I will break down and sell the 7970 farm. The proceeds from this sale will be used to order a second BitForce Mini Rig ‘SC’ (ASIC)
Any available capital after the second Mini Rig order will be put into BitForce Single/Jalapeno purchases
*Reserve the option of purchasing equivalent ASIC technology from a BFL competitor should that become a better option for us

This plan of action will allow us to immediately begin mining and receiving dividends while allowing us to competitively upgrade to ASIC technology once it becomes available.

100% of the coins gained from mining will be paid out
Dividends will be paid on Monday and Thursday mornings before 12 Noon Mountain Time
My compensation will be received as dividends on my 20,000 shares

The dividends received on the 30,000 growth and maintenance shares, after covering monthly expenses,
will be put toward expanding our mining operation with the best available technology.

Bitcoin is an amazing opportunity and I look forward to building one of the top mining companies with you.
The future is uncertain and should we ever need to wind down and close out this asset,
we will do so by liquidating the physical equipment at fair market price and utilizing the proceeds and any other BTC holdings to pay a final dividend.

https://bitfunder.com/asset/BAKEWELL

[Snapman]

So, another guy trying to get the community to buy equipment for them.... what makes yours any different?

[Bitcoin Oz]

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CPA Shareholder Protection Agreement
Customer: Ian B. (bitcointalk.org: ianbakewell)
CPA Agents: usagi (tsukino)
DATE: August 31st, 2012


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A. GLBSE Shareholder Protection Agreement
1. Parties are Ian and his business ("the business"), CPA
   ("CPA") and the GLBSE shareholders of the business ("the
   shareholders").
2. CPA will insure shareholders by paying out on behalf of
   the business should the business become unable or unwilling
   to fufill the terms of it's contract (see section C).
3. CPA will not be liable for losses greater than the value
   of the funds held in trust; all other liabilities are the
   sole responsibility of the business.
4. No party may cancel this contract although any party may
   choose to accelerate their obligation at any time.


B. Payment of Premium
1. The business will contribute one bitcoin (or more) per week
   to a trust account operated by CPA.
2. The payment address is [1JHP6iaNmPs7osgPKoiki2i28ndm8rDddU]
   ("CPA Accounts #18 (Ian)").
3. The first week of coverage is 2012 Week #36 (September 2nd to
   September 8th).


C. Indemnification Procedure
1. If the business breaks the terms of their contract without
   reparation, CPA will pay the value of the trust account to
   the shareholders of the business on behalf of the business.
2. A period of 30 days will be allowed for the business to
   respond and make reparations before paying out on any
   default event.


D. Expiration Clause
1. If there is no default event prior to September 15th, 2013,
   CPA will contact the business and request guidance; the
   options will be:
   1. to extend coverage,
   2. to release the trust account to the business,
   3. to release the trust account to the shareholders
      (as a special dividend).
2. The guidance will be published on the CPA website for a
   period of 30 days before actoin is taken on that guidance.


E. Insurability (This is the "Fine Print")
1. Indemnity
   The insurance company indemnifies, or compensates, the
   shareholders in the case of certain losses only up to the
   lower of the shareholder's interest and the trust amount.
2. Insurable interest
   The shareholders must directly suffer from the loss; the
   shareholders have a "stake" in the loss or damage to the
   assets insured.
3. Utmost good faith
   The business is bound by a good faith bond of honesty and
   fairness. Material facts must be disclosed.
4. Contribution
   Insurers which have similar obligations to the insured
   contribute prior to any contribution by CPA.
5. Subrogation
   CPA acquires legal rights to pursue recoveries on behalf of
   the insured; for example, the insurer may sue those liable
   for insured's loss.
6. Causa proxima, or proximate cause
   The cause of loss (the peril) must be directly related to
   the breaking of the business's contract for financial gain
   at the shareholders' expense.
7. Mitigation - Before, and in case of any loss or casualty,
   the business must attempt to keep the loss to a minimum, as
   if the asset was not insured.


F. DISPUTE RESOLUTION
1. Any controversy or claim arising out of or relating to this
   contract, or the breach of this contract, shall be settled
   by binding internet arbitration at judge.me in accordance
   with the judge.me arbitration agreement. The arbitrator's
   decision shall be final and legally binding and judgment may
   be entered thereon.
2. The business must indemnify (make whole) CPA's incurred
   legal fees if they lose their claim, limited to the amount
   required to be paid by CPA to judge.me.
3. All judge.me fees related to this contract must be paid in
   bitcoins.


////////////////////////////////////////////////////////////////
////////////////////////////////////////////////////////////////

Confirmed

Witnessed 

[Bitcoin Oz]

Why no government ID?

Well, I went to pull it out for this, and realized it expired back in January and my pic is from 6 years ago.
Went to the registry, have a new one on the way, will update when it comes in.

In the meantime I have done my best to provide proof, as some people have asked of me privately.
Including a sock on my head, wtf is with that? I tried a search to look up the forum history but its just people yelling about sock puppets.

lol they didnt ask for a shoe on head ?

I hate it when my ID expires and I need to go back to using a paper birth certificate for all my ID purposes 

[Carnth]

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?

[Carnth]

First purchase and dividends: The first purchase will be as fast as I can execute it following the sale of the 50,000 public shares.

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.

I personally mine @ BTCGuild with my pc right now but I would probably put up a vote between the top pools listed here: http://blockchain.info/pools and take shareholder advice.

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.

[Akka]

I think too, that waiting until all shares have been sold until you start buying equipment is a bad Idea.

In that case I would be waiting until the majority of the shares has been sold and than try to get in, maybe tring to get some shares below IPO-Price, too, as people would surely get frustrated and sell off.

Best plan would be IMO to put asside 2/3 of the BTC ,or so, for the BFL Rig and immediately invest the remaining 1/3 in GPUs to show at least some dividents.

Once the Rig is paied you can invest 100% in further GPU grow.

[Carnth]

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

But I got to be completely honest with you.

A quick comparison of GIGAMINING (currently the most active mining asset on the glbse) shows them trading @ .83 for 5mhash now with an option to pay .25 for an upgrade to 20mhash/s post asic.
you can buy BAKEWELL right now for .15 and have 20mhash/sec post asic.

You would need to hold GIGAMINING and save the dividends they paid for 65 weeks+ to equal the expected gains on BAKEWELL based on current market prices.

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.

My reason for structuring it this way is the BTC:USD volatility. I want to assure the purchase of the first BitForce Mini Rig 'SC'.
I fear that if we take funds as they come in, and buy the gpu's .. and the exchange rate tanks ...

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.

I would like to hear some other opinions on this.

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.

[Akka]

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

+1 Me too

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.

I would devenetly invest in thes project if you would go with one of this options. Especially at the price you are offering. Would prefer option 1 though.

[Carnth]

I feel with the majority of those financial offerings... its all just some paper bullshit shuffled around.

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

- I do not mean to come off as a dick, I truly appreciate bouncing ideas back and forth
I want to build something solid and real here while keep my investors safe and giving competitive returns. Just trying to be as open and honest as I can

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 think a good middle ground would be to wait until 300 or so BTC have been raised, then put up a vote.
Current shareholders could choose to wait, or to purchase 7970s.
- Going back to my fear of the exchange rate, it actually kinda seems like a better idea to quickly grab assets that have a more or less static usd value

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
  

  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. 

[mcris444]

How much do you estimate the mining rig will cost?
Will it be purchased new?



I agree with some of the other posts here. You are competing with other miners.

There is a very similar share CIUCIU.MINING
It is a fund for a "BitForce Mini Rig ‘SC’  by Butterly Labs" and they pay out 1% per week. Once the unit arrives, the interest paid out in advance will be deducted from the weekly profits.

[btharper]

IPO: The biggest flaw that I haven't seen addressed is that there's no incentive to get in early. No discount, no dividend, nothing. As well anyone who doesn't want to wait can sell into your wall at 0.125, or into anyone else's wall at 0.12500001 which is also below your wall. The laws of economics make your security a hard sell right now.

That being said, you have a great plan for what to do after all the shares are sold; you have a solid start on GPUs that can be resold later, and a clear plan to transition into ASIC as available.

My biggest complaint is the 20% "Founders Stake." While I realize that you're putting capital and time forward to setup, manage, and run the IPO, inventory, insurance, and growth. Your plan ends up with you owning $12,000 worth of ASIC for free. Assuming 50x difficulty and 25 BTC block reward you may end up with 600 BTC annually. If the rig runs at 1.5KW and you pay $0.15 USD for your electricity you stand to make $500 USD monthly if bitcoins trade at $10/BTC (Obviously everything would be in local currency though).

Pool: I'd suggest P2Pool with at least some of the GPUs, for large enough miners it provides low variance and comes with zero fees. BFL's FPGAs have been known to not play well with P2Pool, but hopefully this won't be a problem with the new generation of products.

Caveat emptor: The block reward is halving soon and the difficulty is going to shoot up when ASICs come out, both predicted before year's end. This isn't something the security operator can control, but it's something to be aware of.

Also, while you're paying 0.15 to get 20MH/s post-ASIC, dividends are based on half that. That will cause the immediate returns seen by investors to look smaller.

[mcris444]

How much do you estimate the mining rig will cost?
Will it be purchased new?

A new BitForce Mini Rig 'SC' is $29,899usd or roughly 3000 bitcoins @ todays rate
I intend to order new, directly from Butterfly Labs. I had considered paying a premium to get one of the first ones delivered, but I am not sure such an opportunity will arise.

Sorry, should have been more specific. The GPU rig.

[btharper]

I personally think midrange gaming rigs will preserve the most value and allow for the quickest resale.
I lean toward gaming rigs because in the plan the gpu's are only to provide an income while we wait for asic.
We need to retain as much value as possible in the resale to place the second order.

This seemed counter-intuitive at first, but makes good sense. The whole point is to use them as a stop-gap and try to get going again after as fast as possible.

[Carnth]

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

I am well aware of what is required to run a mining rig. I am a gamer who discovered bitcoin, pushing gpu's to the limit is something I am quite good at.
[snip]
I am new to this Tho that specific quote is in relation to the wording of the shareholder contract...

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.

Loaning would imply having it paid back with interest, I am not so sure putting BAKEWELL in debt (even to myself) is a good idea at all.

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.

I understand this concern & am trying to figure out a way to fairly address it.
I believe you may be right with deploying the GPU's first and as funding becomes available

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.

[Carnth]

PureASIC is not a mining bond. It is listed on GLBSE as stock investment,

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.

[Carnth]

I am looking for a way to reward the investors willing to put the first money in, I want to solve this problem:

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.

I would like to create a better "out clause" that is fair to everyone involved should we choose to wind the company down.
- would love your thoughts and opinions on this

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.

[Carnth]

---Paying a dividend out of my own pocket, to be reimbursed from the growth fund once we are underway

• This has the problem of people potentially labelling me a ponzi, as I would be paying dividends before provable income.

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.

[Carnth]

That is what I figured, it just didn't make sense to me and seemed a bit unethical.

The only way I can see it being "ethical" is if you invest idle BTC until you have enough to purchase appropriate equipment.

COGNITIVE has done this very thing to help keep the dividend yield up for investors.
You can see the motion here.

[VeeMiner]

props for the sock on the head