Let's build a Bitcoin Company - I pledge 40 BTC

[eyal]

It started as an Idea for a Bitcoin related service, but then I thought It could actually be possible to set up a whole company, with employees and revenues, in an open-source/wikipedia fashion, purely online, purely with with bitcoins. so here goes..

The employees will be paid in bitcoins, the servers will be hosted on farms that accept bitcoins, and the company would practically not be able to do anything with dollars since it would not have a method of keeping USD.

Every member of the community is essentially an employee - and may get payed, with bitcoins, for his contribution. It is jointly decided by consensus how members should be compensated. if people cannot agree, they can fork the company, in the open-source spirit.

This company would be managed on mediawiki similarly to how policies are set on wikipedia. A process which is open and transparent. it may require few trusted administrators, though they would not have any special rights, just access to resources that require a certain level of trust (e.g. the company's wallet.DAT)

So here's what the company will do in short: A clearinghouse service to let your visitors, customers, subscribers to "Pay with Bitcoin" (very similar to "Pay with PayPal"'). It would offer merchant and other websites which accept payments a super easy way to accept bitcoins as well and get the payment in USD, Bitcoins or any desired split (e.g the company could transfer to the seller his funds 50% in bitcoins and 50% in USD, if he wishes to. The seller enjoys supporting a new high-profiled payment method with a very little effort, and it even reduce his charge-back risks.

It is done using the MtGox API to make sure that bitcoins are sold on realtime whenever customer is making a purchase according to the seller's required bitcoin/cash split. Potentially, fees could be collected to cover for market fluctuations, though it could still be a good deal comparing to PayPal's fees.

Employees required:
Developers
System Administrators
DBAs
QA guys
Online/Offline representatives (reps)

About reps: they would be those who bring new customers to the service and support them. probably a portion of the payment fee should be allocated to their bitcoin account, as they are supporting this account as well. The rep's job could be to contact the merchant, explain to him the nature of the service, and handle the sign-up process until it is fully operational. Get a large merchant, and you can earn yourself a nice monthly recurring income, though you will need to support your customer. They could also be responsible for making sure the funds are transferred to the merchant on a timely fashion.)

I propose that the initial team of administrator would be those who pledge 25+ BTCs to the project. Funds will be used to pay for servers and services as required and decided by the community.

Many thought wikipedia wouldn't work either - and it is quite an amazing accomplishment. I think it's worth giving it a shot.

Other thoughts:

• It could prove to be more secure than paypal - no chargebacks.
• It could really promote bitcoin as new merchants would be accepting it.
• We can build a compatible PayPal interfaces that would make the integration as simple as copy&paste & domain name change - we can make it that easy to accept bitcoins.
• This may be expanded to actual shops (not just online) as more and more people will carry bitcoins on their smartphones and could use it to pay.

 
Other potential components:

• A "Pay" page - Page that is called from the merchant, calculate the price in BTC, etc.
• Mgmt interface for reps/other employees
• Integration with the Bitcoin module
• Integration with MtGox to get realtime prices and market data, as well as to sell bitcoins for merchants that wish to get paid in USD.

Protection against market fluctuations
The market volatility issue can be handled with. The simple solution is to make the fees a bit higher - for example - 5% fee would cover any last min fluctuation with the price (on the long run), and would probably generate a large profit on top of that. The goal would be to find the right fee that would protect the company from changing prices, while remaining reasonable for the merchant and payers. Also, it is possible to examine the actual bids on the integrated Bitcoin exchange - so if a purchase is made, for example, of $1000 in bitcoins, the system could look up the actual exchange-rate in which it can practically sell $1000 worth of bitcoins instantly, according to the current market bids (which may be lower then the current market exchange rate) -  and quoting that adjusted exchange rate to the payer.

Many businesses already accept bitcoins, every day there are more, and it would be great if we could accelerate the adoption this way.

thoughts? pledges?

Community members interested in taking part:
eyal (me): product design, UI design + 40 BTC pledge
cyberaa: developer

[klaus]

http://glbse.com/

[BTCcommodities]

the two are not the same.


if the company would enable me (as a store provider) to rent/lease a BTC-based shopping system from them (with integration of paypal / CC at the customers end), I'd totally hit it.

[eyal]

if the company would enable me (as a store provider) to rent/lease a BTC-based shopping system from them (with integration of paypal / CC at the customers end), I'd totally hit it.

Actually it could be a super-simple solution for the store providers. The service may look like this:

• Quick registration
• A "Pay with Bitcoins" button - technically compatible with "Pay with PayPal" compatible button - so if you have paypal integrated, it would be a non-brainer to integrate this button to the  it would work the exact same way
• A reporting system detailing all the Bitcoin transactions processed by the system for the store provider and current Bitcoin/USD balance
• A weekly/monthly wire transfer of the accumulated funds in USD to a bank account of the provider's choice
• Wallet services for the store provider's bitcoins (if the store provider wishes to keep some % of the income in Bitcoins), which he may transfer to any Bitcoin address of his chose

something like that.. thoughts?

[cyberaa]

i would work on something like that ... looks really interesting if bitcoin will take the jump to something global.This is really interesting and i will be checking it in the future.
As for the positions, i would be interested in dev or sa positions since im a dev...
Looks awesome if it happens and actually would help bitcoin to grow up and have a stable economy ... Also it would make bitcoin be like anyother money since u would be able to pay everything with it ...

[eyal]

i would work on something like that ... looks really interesting if bitcoin will take the jump to something global.This is really interesting and i will be checking it in the future.
As for the positions, i would be interested in dev or sa positions since im a dev...
Looks awesome if it happens and actually would help bitcoin to grow up and have a stable economy ... Also it would make bitcoin be like anyother money since u would be able to pay everything with it ...

Great! I'm adding your nickname to the post. You are absolutely right - the whole purpose of this is to increase the number of product that can be paid for with Bitcoins

[Gareth Nelson]

I'd definitely be interested in joining up as a developer compensated in BTC with rates etc open to negotiation. Same for sysadmin work (though i'll suggest that you may want to have 2 tiers of sysadmin - some with access to the sensitive assets such as wallet.dat and some with access to less valuable assets).

Some thoughts on your business model:
1 - give retailers the option of multiple exchanges or just having BTC alone
2 - fees "may" be collected? no - fees WILL be collected or you make no profit at all
3 - people with money to pledge and people with the best sysadmin skills may not be overlapping groups
4 - offer a "wallet service" as a separate paid service but with value-add such as rapid USD cashout, accounting/reports etc - otherwise let retailers maintain their own bitcoin client
5 - though I may sound a hypocrite, don't build your business around mtgox's API - make it modular (in my defence, my own plan is similar - just starting out with mtgox)

Also, before you get serious interest from people with quality skills, it may help to prove you've evaluated the market:
Who are your main competitors (yes, you have some already) and where will you beat them?

One competitor i'll give away: mtgox themselves offer a merchant API.

[NO_SLAVE]

Sounds good, only problem is that people arent spending BTC like dollars.
They are just hoarding them or trading them as an appreciating commodity.
The volatility of the BTC is something like 5000% more volatile than the Dollar and IMHO will not make BTC effective as a currency.
This dialogue has been going on in other threads, but no clear resolution to that one central issue.

[Gareth Nelson]

Sounds good, only problem is that people arent spending BTC like dollars.
They are just hoarding them or trading them as an appreciating commodity.
The volatility of the BTC is something like 5000% more volatile than the Dollar and IMHO will not make BTC effective as a currency.
This dialogue has been going on in other threads, but no clear resolution to that one central issue.

Chicken
Egg

[speeder]

the two are not the same.


if the company would enable me (as a store provider) to rent/lease a BTC-based shopping system from them (with integration of paypal / CC at the customers end), I'd totally hit it.

I think what he means is you could get funding from glbse, not  that glbse is already what you suggest. Put together a detailed plan, offer some stock and get things moving.

That

[eyal]

I think that as an "open-source" company, maybe it doesn't have stockowners. Maybe just debt for investors that risked their money (even paying back up to 100x on investment)..

[Gareth Nelson]

I think that as an "open-source" company, maybe it doesn't have stockowners. Maybe just debt for investors that risked their money (even paying back up to 100x on investment)..

Investors don't want just their initial investment back - they want to profit from the deal, and most will want dividends.

[Anonymous]

I don't think any rational investor would touch this with a 10-foot pole. There's no reason why you can't make this profitable. I can think of several methods.

Don't just think about how you will benefit the users of your product but the people supporting it. Everyone doesn't just get a good feeling in their stomach by giving people an amazing product. They still need incentive for their work. Like it or not, man isn't a sacrificial animal.

Also, if you say this isn't about profit, I wish you luck in this world.

[eyal]

I'd definitely be interested in joining up as a developer compensated in BTC with rates etc open to negotiation. Same for sysadmin work (though i'll suggest that you may want to have 2 tiers of sysadmin - some with access to the sensitive assets such as wallet.dat and some with access to less valuable assets).

Some thoughts on your business model:
1 - give retailers the option of multiple exchanges or just having BTC alone
2 - fees "may" be collected? no - fees WILL be collected or you make no profit at all
3 - people with money to pledge and people with the best sysadmin skills may not be overlapping groups
4 - offer a "wallet service" as a separate paid service but with value-add such as rapid USD cashout, accounting/reports etc - otherwise let retailers maintain their own bitcoin client
5 - though I may sound a hypocrite, don't build your business around mtgox's API - make it modular (in my defence, my own plan is similar - just starting out with mtgox)

Also, before you get serious interest from people with quality skills, it may help to prove you've evaluated the market:
Who are your main competitors (yes, you have some already) and where will you beat them?

One competitor i'll give away: mtgox themselves offer a merchant API.

I agree with everything. I had some thoughts about how the financials would work:
- the initial group decides what is the required investment amount to execute the project
- investors are offered a deal in which they will be payed back up to x100 their investment - however they have to acknowledge the substantial risk of loosing their investment altogether.
- if the investment round is oversubscribed - then investor may bid for less then x100 return on their investment, therefore letting the market determine the actual return.
- a minimum percentage of the income (e.g. 20%) would be always allocated for investor payouts - however, the investors have the right to wave that right if they feel that's the best thing for the company.
- investments and payouts are made in Bitcoins - so if the value goes up, the investor (as well as the company) benefit from it.

this way we can stay out of share holders/board/dilution nightmare (and "wage slavery") while getting a competitive financing deal.

thoughts?

[cyberaa]

i would work on something like that ... looks really interesting if bitcoin will take the jump to something global.This is really interesting and i will be checking it in the future.
As for the positions, i would be interested in dev or sa positions since im a dev...
Looks awesome if it happens and actually would help bitcoin to grow up and have a stable economy ... Also it would make bitcoin be like anyother money since u would be able to pay everything with it ...

Great! I'm adding your nickname to the post. You are absolutely right - the whole purpose of this is to increase the number of product that can be paid for with Bitcoins

thanks alot  i would work on this with no problem ... lets see more people involved in this, this is a great project and more people should join it.

[eyal]

updates! we have a server and a domain, "OpenBitcoin.Biz" (all bought with bitcoins) and a Wiki (http://openbitcoin.biz/wiki/)

you can see my latest post here: http://forum.bitcoin.org/index.php?topic=26444.0

[terroh8er]

Sounds good, only problem is that people arent spending BTC like dollars.
They are just hoarding them or trading them as an appreciating commodity.
The volatility of the BTC is something like 5000% more volatile than the Dollar and IMHO will not make BTC effective as a currency.
This dialogue has been going on in other threads, but no clear resolution to that one central issue.

I don't think that's true. People seem to be way more willing to spend bitcoins over dollars.

[unemployed]

Actually it could be a super-simple solution for the store providers. The service may look like this:

• Quick registration
• A "Pay with Bitcoins" button - technically compatible with "Pay with PayPal" compatible button - so if you have paypal integrated, it would be a non-brainer to integrate this button to the  it would work the exact same way
• A reporting system detailing all the Bitcoin transactions processed by the system for the store provider and current Bitcoin/USD balance
• A weekly/monthly wire transfer of the accumulated funds in USD to a bank account of the provider's choice
• Wallet services for the store provider's bitcoins (if the store provider wishes to keep some % of the income in Bitcoins), which he may transfer to any Bitcoin address of his chose

something like that.. thoughts?

Looks similar to MyBitcoin with their Buy Now button and eWallet.

"A weekly/monthly wire transfer of the accumulated funds in USD to a bank account of the provider's choice"
Is this part doable?

[MeSarah]

Is this another, I have an idea and a few btc but no skills so build it for me and I'll let you share in the profits if I decide there are any profits. You know I have to pay myself before there are profits.