Hello Chris,
Thank you for your feedback - which is very valuable because it obviously shows
that our site did not address these issues for you:
(1) Most importantly - the solution conceived and developed over the last 3
years - came about from the realisation that the value of an individuals's
spare time or underused resources dissappears - in the same way that food
becomes unsaleable after it's 'use by' date. It therefore occurred to me that
it made sense to "fund" innovative ideas and unproven teams to market using the
required people and resources rather than the money required to buy them on the
open market. Having said that, even if a few hours per week could lead to a
premium payment, a top job or a stake in the next big wb success, unless the
risk was reduced most people would not be interested....
(2) So we developed DealMaker Online (see ww.piefinance.com/DealMakerInfo.aspx)
and a whole host of risk mitigation innovations that significantly increase the
chances of people getting paid:
(a) Payment out of revenue - as opposed to profit - starts sooner and is
more transparent.
(b) A detail plan helps identify and eliminate risks - or determine that
the proposition is untenable - especially if it's worked on by all of the
technical and commercial resource providers with current knowledge of market
risk and technical limitations.
(c) By exporting the plan to an accounting system and using it to run the
business, management error risk is minimised and performance can be measured
against milestones.
(d) Payment are distributed by a trusted 3rd party (eg. a bank), not the
company management according to plan.
(e) If milestones are not met, the system allows a reverse royalty
structure to be defined so maximum value can be extracted from the IP,
prototypes, brand, order book and other created assets.
(f) As usual, the created assets remain the property of the stakeholders
until payment is made.
(g) Funding rounds are very short to minimise the risk that availability
of resource or skills providers changes and each has multiple back ups.
(h) This working basis is only required until the venture can access
sufficient revenue and/or finance to move to a normal payment basis.
Does the above information convince you that the solution is workable? If so,
how would you convey it to potential users?
Kind regards
Senake
Senake Atureliya
Managing Director
Pie Finance Limited
83 Victoria Street
London
SW1H 0HW
United Kingdom
T: +44 (0) 20 7684 4700
F: +44 (0) 20 3051 7147
M: +44 (0) 7958 933248
E: [email protected]
W: [http://www.piefinance.com/] www.piefinance.com
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-----Original Message-----
From: "Chris Neale" <[email protected]>
Sent: Tuesday, June 15, 2010 1:38pm
To: "'mySociety public, general purpose discussion list'"
<[email protected]>
Subject: Re: [mySociety:public] Views wanted - on our sustainable solution
enterprise and employment creation solution
Most start-ups don’t get anywhere close to the stage where they’re paying
people out of revenue (which is reason for that 3% number), so volunteering to
work for a possible future payout is incredibly high risk even if the potential
payout is much higher than the market rate. Consequently, as an entrepreneur
I’d have to be very wary that anyone agreeing to work on that basis might just
give up and walk away leaving me with the problem that my business plan’s
timeline is screwed. They couldn’t be contractually bound to do the work
without me being contractually bound to pay them in time even if the project
fails unless they’ll sign something very dubious.
In essence it sounds like you’re trying to turn “sweat equity” into a job. It’s
an admirable idea, and it’d be great if you can do it, but it’s going to be a
huge job selling the idea of working for possible future wages to people. One I
think you might find is insurmountable. In fact, I imagine most start-ups would
find it easier to find people willing to work for free.
C
From: [email protected] [mailto:[email protected]]
Sent: 15 June 2010 12:38
To: [email protected]
Subject: [mySociety:public] Views wanted - on our sustainable solution
enterprise and employment creation solution
Hi Everyone,
I am interested in getting your views on our sustainable solution to enterprise
and employment creation which facilitates the following:
(1) The "funding" of business start up with peoples spare time and resources -
currently less than 3% of even investor ready, high growth venture propositions
succeed in raising finance.
(2) Enabling individuals to help create their own well paid jobs by help a
start up get to market by working on an initial premium priced, but paid out of
revenue basis.
(3) Reducing or eliminating the ongoing cost of employment and enterprise
support services by getting them paid for on the same premium priced, deferred
payment basis.
(4) Minimising lost tax revenues due to informal collaboration and bartering -
our platform minimises repayment risk by enabling revenue distribution by a
bank or payment processor.
(5) An increase in the number of later stage investable ventures boosting the
recovery.
Details on the solution can be found at [http://www.piefinance.com/]
www.piefinance.com
Your thoughts on it's merit and drawbacks would be much appreciated, together
with any thoughts on how it could be rolled out for maximum public benefit.
Kind regards
Senake Atureliya
CEO
Pie Finance Ltd & Pie Finance (Not for Profit) Ltd, London
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