[HAVELOCK] BTM leasing inventory fund

[NotLambchop]

...
IF: The prospectus directs the usage of the funds raised on Havelockinvestments.com. Summarized: Funds are to be used for the purchase of inventory that will be leased to operators globally. In the highly unlikely event that we are not able to do procure leasees, the funds would be returned to the unit holders since they would not be able to be used for other activities.

Havelockinvestments.com requires proof of usage from the management company for any withdrawal of funds from the Fund. We will provide Havelockinvestments.com with the contract, pre-payment fees invoice & proof of pre-payment payment from the leasee (trackable by them on the blockchain and verified against the contract and invoice provided by Ignite Financing), as well as the invoice from the manufacturer. Havelockinvestments.com can release the funds directly to the manufacturer invoice BTC address from the Fund (all BitcoinATM manufacturers invoice directly in BTC). There is no reason for these funds to ever touch the management company's Bitcoin wallet.
...

If Havelock is to be the custodian of the raised funds, it is not stated in your prospectus.  I realize Havelock has experimented with playing intermediary, and doling out raised funds as a parent would dole out his child's allowance, but such stewardship proved problematic for the "investors" of MintSpare (ticker: MS):  While Havelock is [allegedly] still holding 100 BTC, both it and the issuer have simply ceased all communications with the unfortunate "investors" after the stock tanked.

The last comment from Havelock (note date):

There are no plans to release any additional units of the Fund.
Everyone understood that the success of this company is heavily depended on the Bitcoin price and popularity.
If and when Bitcoin makes a "comeback" in price, so will the customers that want to trade their electronics for Bitcoin.

Last dividends:  never.

Last official update:  February 14th, 2014

The last comment from the issuer (note date):

Update is under review by Havelock.

TL;DR:  If Havelock is taking on any, above purely technical, responsibilities upon itself, the extent of these responsibilities should be concisely delineated by Havelock, and included in your prospectus.  No one wants another MintSpare.

Oh Jesus, don't tell me this guy ain't 100% legit!

[IgniteFinancing]

Havelock is not the "custodian of the shares".

Any problem you have with any other Havelock fund, take it to the relevant thread, or talk directly with Havelock.

[NotLambchop]

You have stated that Havelock will be holding the funds, and dispensing said funds to you only after having verified and approved their intended use.  That describes the role of the custodian.  I quote:

...
Havelockinvestments.com requires proof of usage from the management company for any withdrawal of funds from the Fund. We will provide Havelockinvestments.com with the contract, pre-payment fees invoice & proof of pre-payment payment from the leasee (trackable by them on the blockchain and verified against the contract and invoice provided by Ignite Financing), as well as the invoice from the manufacturer. Havelockinvestments.com can release the funds directly to the manufacturer invoice BTC address from the Fund (all BitcoinATM manufacturers invoice directly in BTC). There is no reason for these funds to ever touch the management company's Bitcoin wallet.
...

If Havelock is incapable of providing sound stewardship, the issue is relevant for your potential "investors."

P.S:  Since you are trying your hand at being concise, keep in mind that text enclosed by quotes must be verbatim.  For instance, I have never used the phrase "custodian of the shares" (which you seem to be attributing to me), making it difficult to understand just whose claim you are refuting.

[IgniteFinancing]

I would refer you to Havelockinvestments.com for specific documentation on how they manage funds for companies that raise on their platform.

[NotLambchop]

Please do.  I'm unable to find such documentation.

Edit, regarding this:

...
The management fee on this Fund is not enough to cover the expenses directly involved in managing the fund, hence we raised a small private equity round to cover our internal business expenses (salaries, rent, back-office systems, travel, support, contract management, etc) while we grow Ignite Financing and our Fund -> Lease model, as well as additional internal initiatives, such as smart contracts (leases directly on the blockchain) and other interesting applications of the Bitcoin technology within the business.

Ignite Financing is subsidizing the Fund's management and administration expenses since the method is new to the space, and we have to prove this method to investors through good returns in order to raise additional funds to back ever more machines (this raise purchases around 12 machines against our current outstanding orders of over 80).
...

Seems ur taking 20 BTC (~$12k) from the funds raised on Havelock, according 2 ur prospectus:


http://ignitefinancing.com/BTM_prospectus.pdf

[tempestb]

Why does management get 25% of revenue, but investors get net after expenses?  That's a pretty cherry deal for you guys. 

So, if we say Bitcoin is $600.  You're gonna get $162,000

You're going to buy 12 machines.  So each machine is $13,500 worth of the investment.  I realize you're keeping 20 bitcoins to reward yourselves for putting this together, but ultimately it's $13,500 per machine since the investors are looking to earn their money back.

On a single year lease, you'd have to earn $1125 a month, to pay back the value of the machine, without even taking your 25% cut and the various fees along with it. 

I think it's safe to say, nobody is going to lease this machine for that kind of money.  Not unless they can earn more than that per month, which seems unlikely.  Maybe a three year lease, at $375 a month.  But even then, that's not enough because you have to add on the 25% for you and the additional 25% you're predicting in profit.  So $562.50 a month.  And whatever extra for fees over three years.

I doubt you sell this machine for that much a month.  If you expand it beyond three years, you risk the machine failing anyway before it returns enough revenue to make it worthwhile.

I can't see how investors make money here.  It seems like a sweet deal for you guys, but investors are going to get screwed.  What are you charging per month for a lease?  If it's different per operation, you still have to have some kind of ballpark figure.  What is it?

[Korbman]

Honestly, I'm quite surprised this thread has made it to 2 pages. Normally something lacking in any real information just gets ignored in these parts...

Anyway, this has been dead in the water since day #1. The prospectus lacks any and all realistic financial information that investors would need to even start their due diligence process. I presume someone with prior management experience would already recognize the lack of information provided, so I must assume there's something else going on here. If legitimate funding routes (the Angel and Venture Capitalists you've referred to) aren't willing to go the full way to get you started, I have a hunch there are some serious flaws in your business model.

From what I've read so far, there is absolutely no incentive for someone to invest a single Satoshi in this. It just doesn't make any sense.

Regardless, I do want to see more Bitcoin ATMs around the States. Best of luck to your team.

[hl5460]

Translated into Chinese and posted:
http://8btc.com/thread-6614-1-1.html

[Gleb Gamow]

Torrance Miles

Post subject: Re: Money System, my opinionPostPosted: Sat Dec 20, 2008 2:57 pm

Joined: Sun Dec 14, 2008 7:42 pm
Posts: 7
Location: Iowa or Washington state, USA, depending on my mood.

http://forums.osgrid.org/viewtopic.php?f=3&t=545&start=20

Ralf (Mr. Shark):
I was not around for ARPANet. Even in '91 rural America didn't have Internet access. I don't think my hometown saw decent local Internet access (without calling Minneapolis, Chicago or further) until the late 90's (1998 I think).

Buyers on websites are not anonymous, people often think they are because there is not someone standing looking at them when they make the purchase. When you order a book from Amazon, you are entering in your credit card info. Paypal knows who you are. Google probably knows more about you than yourself! If someone is entering into a contract, real info is going to be wanted as a contract is implied. If you rent server space from me, you're gonna want to know who I am so that when I steal all your data and start selling it myself you have a court based remediation process. I'm not aware that it has been tested in a court in US or EU yet, but I assume that the "Avatar" is the person and contractual obligations will stand.

I understand the desire to be anonymous, but don't think it can fully stand up to the rigors of business needs. Am I anonymous on OSGrid? Nope, OSGrid knows who I am, at least in a way. The user server has my e-mail address, the system has my IP, it is even transmitted to the individual region servers. Both of these could be used to track back to me sitting in my office. Linden Labs knows who you are, especially if you have a Credit Card on file with them. I don't see that OpenSim is going to be any less secure than the web. There is no reason we couldn't run over SSL, hide personal details when directing a customer to PayPal or the like...

Now, I was a rash in saying that I would never accept Linden$. If that is what people will pay me in, I will likely end up taking it rather than turning it away. Depends on how badly Linden Labs messes with it. I won't be holding it as part of a currency portfolio though!

I was not aware that one could interface with PayPal in Second Life. That is interesting information.


Rock:
I agree it is early, but I think that is good.

Renting land is a euphemism for paying for server space. Not everyone that wants to hook up to OSgrid, or any other OpenSim grid, has the server, bandwidth, know-how, etc to just set-up and admin their own region. There is great possibility here for hosting companies. Uploading textures is another euphemism for storage space and bandwidth charges. Script charges and extra prims are much the same, storage and CPU/RAM usage.

Product is not the only business model. I think services (and software as a service) will be a (the?) major market.


One does not need to participate in any market to have a good time and get a full experience from OS Grid. There are a ton of free resources and people can always build what they want. OpenSim can easily run a region on any PC that can run the viewers. I could see transitory regions (apartments?) even being a built-in option in future viewers.

*why can't I just write short posts, rather than essays?

- Torrance

Some people call me Digger.

[IgniteFinancing]

BTC would fit in very nicely in OpenSim and the various other virtual reality spaces. Too bad I haven't been involved in that for several years. There are several companies working with BTC for in-game / virtual reality currency (OpenSim had no native in-game currency). There could be interesting usage cases for OneName and BitMessage as well. OpenSim was exciting to me due to its decentralized p2p nature (anyone could/can run a server and connect to the network) vs. the centralized control SecondLife had on their platform, and their constant meddling with their in-game currency (sound familiar?). If only Bitcoin had been developed then... I'm pretty sure the server I used for the OpenSim rented spaces is the one we now use for our full Bitcoin node and Tor exit node.

These walks down memory lane are fun, and I have been involved with many diverse activities, hobbies, and technologies over the years, and will likely be involved in more in the future, but, this is quite off topic. Please keep posts relevant to the current offering on Havelock.

On topic, we are working on a lease revenue example to report here and update in the prospectus. I expect we'll post the updates sometime this evening.

[IgniteFinancing]

We've posted an updated prospectus to Havelockinvestments.com that adds information about leases and lease revenue per BitcoinATM.

[Gleb Gamow]

BTC would fit in very nicely in OpenSim and the various other virtual reality spaces. Too bad I haven't been involved in that for several years. There are several companies working with BTC for in-game / virtual reality currency (OpenSim had no native in-game currency). There could be interesting usage cases for OneName and BitMessage as well. OpenSim was exciting to me due to its decentralized p2p nature (anyone could/can run a server and connect to the network) vs. the centralized control SecondLife had on their platform, and their constant meddling with their in-game currency (sound familiar?). If only Bitcoin had been developed then... I'm pretty sure the server I used for the OpenSim rented spaces is the one we now use for our full Bitcoin node and Tor exit node.

These walks down memory lane are fun, and I have been involved with many diverse activities, hobbies, and technologies over the years, and will likely be involved in more in the future, but, this is quite off topic. Please keep posts relevant to the current offering on Havelock.

On topic, we are working on a lease revenue example to report here and update in the prospectus. I expect we'll post the updates sometime this evening.

Thank you kindly for being civil with your reply. Good luck, bud.

~Bruno Kucinskas

[IgniteFinancing]

The Fund is now live:
https://www.havelockinvestments.com/fund.php?symbol=BTM


A follow-up on some questions and comments:

The 20BTC difference between raised funds and utilized funds (270-250) mostly go to cover expenses already incurred on behalf of the Fund, and exchange filling & listing fees. There is no windfall profit here for Ignite Financing. A break down of usage funds will be included in the Fund's first report, expected to be delivered 30 days after of the close of the listing.

From the updated prospectus available at Havelockinvestments.com:

Leases and Revenue from Leasing
Lease terms generally run from 36-60 months, with 36 months being the most common. Leases are structured such that there is a pre-payment of fees by the operator to initiate the contract and manufacturer order, a set number of monthly payments, and a final residual/purchase value of the BitcoinATM, which can be 1) purchased by the operator, 2) re-leased by the operator on new terms, or 3) returned to Ignite Financing and the lease is completed (operator may choose to lease newer equipment). On the event of a returned unit at the end-of-lease, the management company may sell the used unit on the open market or lease to another qualifying operator, for the benefit of the Fund.

For illustrative purposes, and based on expected common lease terms, we can assume an average retail price of $14,500 USD*, 36 month lease, and end-of-lease purchase option is executed by the leasing operator: the Fund realizes gross revenue of ~$25,000 USD over the course of the contracted lease (pre-payment + sum of all monthly payments + end of lease purchase).

* This example does not take into account special manufacturer pricing, additional discounts, incentives, and/or rebates which could increase the per machine gross revenue on behalf of the Fund.

"But, this really expensive!"

Yes and no. These amounts are not grossly out of line with other financing and leasing options for similar equipment. The leases do run a little higher at this time due to various reasons (new industry, lack of traditional financing options, etc).

As discussed previously, there are various reasons why an operator chooses to lease (payments via cash-flow, tax benefits (OPEX vs. CAPEX), alternative usage of capitalization, upgrade options, and so on). The operator determines the best usage of their capitalization, and leasing is a viable and competitive method. The lease is, maybe surprisingly, one of the less expensive line items of an operator's on-going budget, especially when you are operating multiple machines across a larger geographical region (such as 5 BitcoinATMs, one in each of the top 5 population centers of, say, Germany, and especially for multi-national operators).

In talking to operators, what draws them to this method is the ability to deploy 3-4x times as many BitcoinATMs as they would have if they opted to purchase. This allows them to access economies of scale when running their business, such as negotiating contracts with cash handling services, marketing, licensing, liquidity/exchange platforms, location rent, and more.

I can't explain how excited Mike and I are to be working to maximize the Fund's profit, and in the process increase the number of physical access points to Bitcoin globally. We truly believe BitcoinATMs are the fastest and easiest way to access Bitcoin (no waiting for bank transfers to clear), enabling more people to enter into the Bitcoin ecosystem, increasing the overall value of the network for all of us.

Any more questions or comments, please, post them and we will continue to answer as best we can.

[IgniteFinancing]

We have been having a great time talking and meeting with current and potential investors, so we are doing additional Open Office Hours:

- Fri, Aug 15, from 12:00-14:00 CDT
- Sat Aug 16, from 15:00-17:00 CDT

Individual time blocks are 15 minutes. Schedule your time to talk to us via Skype at:
http://ohours.org/IgniteFin

Schedule a time and we can talk about the BTM Fund and BitcoinATM leasing, or commiserate with us about the recent price drop.

[IgniteFinancing]

Ignite Financing has translated the prospectus into Chinese.

Ignite Financing招股说明书翻译转换成中文版.  你可以在这里找到:
https://www.havelockinvestments.com/reports.php

[IgniteFinancing]

We made some big improvements to the website: http://ignitefinancing.com/
* We're still making some minor improvements and adding content, but wanted to get it pushed out as soon as possible.

BTM Fund specific page at: http://ignitefinancing.com/investors/

[kgantchev]

This is an excellent option offered by BitLendingClub and BTCPoint for an operator to get a BTM, though this is only offered for BTCPoint machines at this point. I do hope they add many more manufacturers if this model is successful for them. More options for the greater proliferation of BTMs globally are good for the entire ecosystem.

BitLendingClub now has integrated loans with BitXATM, CounOutlet and BTCPoint.