Re: Generalizing Peer Production into the Physical World
- Hi Scott
Although I'm based in Linlithgow, Scotland (birthplace of Mary, Queen
of Scots) I'm not Scottish myself, just a mongrel.
--- In firstname.lastname@example.org, "Scott Feamster" <sf@...>
>family, angel, or venture capital investment in the U.S. Equity will
> What Chris describes is equity capital that we call friends and
continue to provide the costliest investment dollars; debt will
continue to provide the cheapest investment dollars.
>The "who" is immaterial.
It's the "how" of this new form of Equity that is entirely novel
(although, as I said, Canadian "Income Trusts" come close).
This is not "Equity" as in a Limited Company, and is a lot less
risky, albeit the returns MAY be less than those from Equity in a
Corporation, so are the risks.
Investors receive a proportional share of the revenues from the
property financed (whether Real property or IP) BEFORE the
management gets its hands on them.
If there are any revenues, of course.
In other words, in this model Labour works WITH Capital not FOR it,
and you don't get the "Principal/Agent" problem which
all "Corporations" have, and which is why there is a huge body of
Company law, and that famous oxymoron, "Corporate Social
This "Open" form of Capital is an entirely new and simple
(unlike "mezzanine", convertibles, warrants etc etc) middle ground
between conventional "Debt" and "Equity", and in my experience comes
in a lot less expensive than conventional "Equity", but more
expensive than "Debt" wwith potential of a much greater return.
There cannot be a default, because it is not a "cost" or
an "overhead", but rather a "pre-distribution".
This is something entirely new, and it does take a bit of getting
your head around, for sure.