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FINU Manager
FIN-U
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Posted - 2007.04.15 14:55:00 -
[1]
FIN-U Bond Details
1) Background
Eve Financial Services (better known by the corp ticker of FIN) was launched in September 2006 offering a secured investment product with a guaranteed minimum return. The investment for FIN was T2 BPOs which could be locked down to secure asset value.
This worked well until CCP decided (in their infinite wisdom) to fiddle in the economy once again with reseeding and invention. So although FIN still makes more than the minimum return, the capital value has dropped which means that Isk has to be re-invested to increase the capital value of the fund at the expense of the dividends.
Although the FIN investors agreement allows for the terms of the investment to change I do not believe that it would be in keeping with the spirit of the initial investment and would likely not be in the best interests of all investors. The solution is to form a new investment fund which does not have any official security but pays out the actual returns rather than diverting them into capital growth.
2) What would the investment be in?
a)Trade
b)Financial products
c)Invention
d)Anything that FIN-U decide would be a good idea
3) What are the details?
The new corp is called FIN-U (for FIN Unsecured) and will operate under the following rules:
a)Bond will be sold for 1,000,000 Isk (1 Million Isk) each, directly through FIN-U and through the stock exchanges once they are listed (there is a listing process that takes some time). FIN-U will at all time hold the majority of bonds and may issue more bonds subject to demand.
b)Interest will be paid out based on the actual returns achieved. This is expected to be 6-8% once the business gets going.
c) There will be no security at all beyond my word. That means it is possible for me to just run with all the Isk, so if you donĘt trust that I wonĘt run with it then donĘt invest.
d) Reports every month will be general in nature without feedback given for every Isk spent. I have enough to do in life without spending all my free time capturing data into a spreadsheet.
e)There will be no official buyback policy. Of course it is possible to sell the bonds on the open market using one of the two stock exchanges (EGSEx and ResX). However if for some reason it is decided to close FIN-U down, all bonds will be bought back for the original selling price of 1,000,000 Isk each.
f)Interest (in the form of dividends) will be paid out by the end of each month. This may be split into multiple smaller dividends during the month or as a single large dividend at the end of the month at FIN-U managementĘs discretion.
g)There will be a management fee of 10% of the profits each month.
h)Although from time to time bond holders may be asked to give their opinion or vote on various issues, this is an indulgence by the FIN-U management and not a right. Bond holders will have a claim on the profits generated each month but will not have any official claim on decision making.
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FINU Manager
FIN-U
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Posted - 2007.04.15 14:55:00 -
[2]
reserved for future use
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FINU Manager
FIN-U
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Posted - 2007.04.15 14:57:00 -
[3]
reserved for future use
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FINU Manager
FIN-U
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Posted - 2007.04.15 14:57:00 -
[4]
reserved for future use
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Eefrit
Eve Financial Services
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Posted - 2007.04.15 15:10:00 -
[5]
Confirming that FINU Manager is my alt.
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Ionia
Advanced Manufacturing
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Posted - 2007.04.15 15:14:00 -
[6]
Congrats on the launch Eefrit, I am sure there is no doubt in the community of the value of your word and these will sell like hotcakes!
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Motivated Prophet
Zerodot Schools Power Corrupts Industry's
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Posted - 2007.04.15 15:18:00 -
[7]
Needz moar link to sales thread.
I trust you're applying for EGSEx listing? I see aftermarket trading listed as a possibility, but didn't see explicit reference to an application.
MP
--
TINY. Stage 2 IPO, because good things come in pairs. |
Eefrit
Eve Financial Services
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Posted - 2007.04.15 15:38:00 -
[8]
Originally by: Motivated Prophet Needz moar link to sales thread.
I trust you're applying for EGSEx listing? I see aftermarket trading listed as a possibility, but didn't see explicit reference to an application.
MP
Link now added as the sales thread did not exist at the time of posting this.
Yes, I am in the process of applying to EGSEx and ResX and will have done so within the next few minutes.
Cheers,
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Shadarle
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Posted - 2007.04.15 16:28:00 -
[9]
Why are you calling this a Bond rather than an IPO? Wouldn't a bond reach maturity and then pay back in full at a specific point in time?
I am not a financial expert in such terms... but my basic understanding of the topic and also my limited browsing of Wikipedia on the subject revealed this comparison of stocks and bonds.
"Also bonds usually have a defined term, or maturity, after which the bond is redeemed whereas stocks may be outstanding indefinitely."
Tanking Setups Compared
Stacking Penalty / Resists Explained |
Eefrit
Eve Financial Services
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Posted - 2007.04.15 16:36:00 -
[10]
Originally by: Shadarle Why are you calling this a Bond rather than an IPO? Wouldn't a bond reach maturity and then pay back in full at a specific point in time?
I am not a financial expert in such terms... but my basic understanding of the topic and also my limited browsing of Wikipedia on the subject revealed this comparison of stocks and bonds.
"Also bonds usually have a defined term, or maturity, after which the bond is redeemed whereas stocks may be outstanding indefinitely."
You are right that bonds "normally" have a fixed maturity date but not necessarily. Fixing a maturity date within the mechanics of Eve is problematic to say the best.
The difference between bonds and shares are that with shares you are buying a portion of the company and own a portion of the company whereas with bonds you own a portion of the profits of the company but not the company itself.
You could think of them as non-voting class B shares, but that is also not strictly true here.
I hope that helps.
/Eefrit
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Ionia
Advanced Manufacturing
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Posted - 2007.04.15 16:50:00 -
[11]
This is not without precedent, although is very very unusual in today's market
Originally by: Wikipedia Perpetual bonds are also often called perpetuities. They have no maturity date. The most famous of these are the UK Consols, which are also known as Treasury Annuities or Undated Treasuries. Some of these were issued back in 1888 and still trade today. Some ultra long-term bonds (sometimes a bond can last centuries: West Shore Railroad issued a bond which matures in 2361 (i.e. 24th century)) are sometimes viewed as perpetuities from a financial point of view, with the current value of principal near zero.
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Kim McCormack
BIG
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Posted - 2007.04.15 16:53:00 -
[12]
How many bonds are you initially releasing? Or is it open-ended until you feel you've reached a comfortable number?
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Eefrit
Eve Financial Services
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Posted - 2007.04.15 17:26:00 -
[13]
Originally by: Kim McCormack How many bonds are you initially releasing? Or is it open-ended until you feel you've reached a comfortable number?
It is open ended as I do not expect to raise isk faster than I can get it working. I will likely freeze the sale of bonds at times when I have more capital than I can reasonably invest or I may freeze it permanently once I get to a point where I feel I could not manage any more Isk well.
/Eefrit
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Shadarle
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Posted - 2007.04.15 17:41:00 -
[14]
Originally by: Eefrit
Originally by: Shadarle Why are you calling this a Bond rather than an IPO? Wouldn't a bond reach maturity and then pay back in full at a specific point in time?
I am not a financial expert in such terms... but my basic understanding of the topic and also my limited browsing of Wikipedia on the subject revealed this comparison of stocks and bonds.
"Also bonds usually have a defined term, or maturity, after which the bond is redeemed whereas stocks may be outstanding indefinitely."
You are right that bonds "normally" have a fixed maturity date but not necessarily. Fixing a maturity date within the mechanics of Eve is problematic to say the best.
It seems it would be as simple as setting a term and then at the end of that term you issue dividends to all stockholders equal to the initial price and then close the corp out... or simply stop paying dividends at that point.
I understand this is not how your venture is going to work, but it doesn't seem like it is all that hard to do with EVE mechanics. Ionia is planning to do it with the bond she is selling currently.
In any case, good luck with your bond
Tanking Setups Compared
Stacking Penalty / Resists Explained |
Roemy Schneider
BINFORD
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Posted - 2007.04.15 18:04:00 -
[15]
look... i understand these are harsh times, production has become a little more complicated, mining got screwed over by drone ratting etc etc etc but is there really need for another ISSO? only half of their intended budget was injected so far and a lot of those shares were handed out for fishy deals to begin with. i wonder if they could even reconstruct how much money really came in for all those shares.
anyway... no buyback, no security, slightly higher interest than ISSO but otherwise the same deal: you park your money at a rather large and known entity and can only hope that 13-17 months later, you'll be back where you started. stock market surfers will offer 500,000isk to get the dividends they're used to, so the break-even would be reached no sooner than 6-9 months after investing ("... once the business gets going" not included)
sry eefrit, but ISSO removed all of my already little faith in these. yes, i'm positive you'll stick to your word just as ISS sticks to their bare minimum - folks running around for years with idle cash will enjoy this. but such timeframes just don't lure my pennies out of the mattrass.
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Eefrit
Eve Financial Services
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Posted - 2007.04.15 18:52:00 -
[16]
Roemy, I never expected something like this to be for everyone as it is a niche product. If you don't have a lot of idle Isk then there are few if any investments that will make you more Isk than you could yourself with a lot of effort.
Otherwise there are large differences between FIN-U and ISSO and they would generally appeal to a different segment of the market although I would agree there will be some overlap.
/Eefrit
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Imperius Blackheart
Caldari Reprocity Pure.
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Posted - 2007.04.15 19:00:00 -
[17]
Hey, interesting preposal, if I was gonna trust anyone with money in this kinda thing it would be you.
However as a bond holder in FIN I would be concerned with how this will effect FIN that investment, and the ammount of attention you will be able to give to improving that fund.
Whilst I would like to invest in FIN-U for the higher rate of return that potentially could come out of it I am nervous about what this means for FIN the returns I get from that investment and its potentially deminishing returns.
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Rodrom Caldera
Gallente BGG League of Abnormal Gentlemen
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Posted - 2007.04.15 22:39:00 -
[18]
As a multi bilion isk share holder of fin i do ask the same thing. How wil this affect my current investment? -*-*-*-*-*-*-*-*-*-*-*-*-* I'm writing a evolving Epic story with side story's to support the whole.
Story |
Kim McCormack
BIG
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Posted - 2007.04.16 09:38:00 -
[19]
Seeing as it's a guaranteed 4% and it's just from Tech II BPO production and sales it should not be affected. And from what Eefrit says he's been doing this for awhile now so it's not like it'll suddenly affect his time-investment in FIN.
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Eefrit
Eve Financial Services
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Posted - 2007.04.16 09:41:00 -
[20]
Originally by: Imperius Blackheart
Hey, interesting preposal, if I was gonna trust anyone with money in this kinda thing it would be you.
However as a bond holder in FIN I would be concerned with how this will effect FIN that investment, and the ammount of attention you will be able to give to improving that fund.
Whilst I would like to invest in FIN-U for the higher rate of return that potentially could come out of it I am nervous about what this means for FIN the returns I get from that investment and its potentially deminishing returns.
That is a good question, which I will add to the FAQ sections.
Basically FIN will continue in the line that it was created for. That is investing in T2 BPOs. That is actually not a lot of work considering that I build and sell a lot from my personal BPOs as it is.
I honestly can not see how FIN will be negatively effected by FIN-U as they will primarily be working in completely different market segments. I have never charged FIN a management fee purely because it is not a lot of extra work for me - if it were a lot of work I would have been charging a fee without any doubt.
If you recall the discussion thread on changing the security in FIN, it was clear from there that some people wanted increased risk and increased returns, but in the end I felt forcing that on people that bought into FIN because it was secured would be in a way being betrayed by that change. FIN-U is the best solution that I could see to appease both factions.
Please come back at me if I've missed the gist of your question.
Regards,
Eefrit
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Chip2k3
Energy. Insurgency
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Posted - 2007.04.16 12:27:00 -
[21]
can we trade FIN shares for FIN-U shares? and what would you invest in if you were going for one of the two?
sig pending. |
LlamaOfPoon
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Posted - 2007.04.16 12:33:00 -
[22]
What sort of capital are you aiming to raise with the initial bond offering?
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Imperius Blackheart
Caldari Reprocity Pure.
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Posted - 2007.04.16 13:32:00 -
[23]
Thanks for the reply Eefrit, jesus that was a bad post of mine.. Must remember not to visit the eo forums when its so late at night.. but yes you got the gist of my post and answered it well.
And well you can put me down for an inital 100 million.
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Eefrit
Eve Financial Services
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Posted - 2007.04.16 16:31:00 -
[24]
Originally by: Chip2k3 can we trade FIN shares for FIN-U shares? and what would you invest in if you were going for one of the two?
I would like to do that, but it would not reduce the required security in FIN and would therefore amount to having the FIN-U investors subsidise part of FIN as it would not be injecting any working capital into FIN-U.
You can always sell your FIN bonds on the exchanges and buy FIN-U bonds with them though.
/Eefrit
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Eefrit
Eve Financial Services
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Posted - 2007.04.16 16:35:00 -
[25]
Originally by: LlamaOfPoon What sort of capital are you aiming to raise with the initial bond offering?
The amount of capital that will be raised in total will depend on how much can effectively be employed and used to make Isk at a decent rate.
I don't expect that FIN-U will raise Isk at a faster rate than I can invest it effectively, but if that happens I will freeze bond issues until the Isk is well invested.
Sincerely,
Eefrit
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BhurakStarkiller
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Posted - 2007.04.24 03:41:00 -
[26]
200 shares, isk sent
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Kazzac Elentria
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Posted - 2007.04.24 13:39:00 -
[27]
If anyone can pull this launch of it would be you..
...liquidating some stock this week and will buy in sometime shortly after. |
Eefrit
Eve Financial Services
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Posted - 2007.04.24 17:12:00 -
[28]
Originally by: Kazzac Elentria If anyone can pull this launch of it would be you..
...liquidating some stock this week and will buy in sometime shortly after.
Thanks Kazzac. It's always nice to get positive feedback from people, and for those that have sent me evemails wishing me well, thank you too.
I'm sure you will be happy with FIN-U in the future.
Regards,
Eefrit
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virox sci
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Posted - 2007.05.17 04:16:00 -
[29]
10M in bonds for me please :)
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Ricdic
Caldari Corporate Research And Production Pty Ltd Zzz
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Posted - 2007.05.27 03:54:00 -
[30]
Hey Eefrit, just curious to know how many bonds have been sold to date, and/or the amount of capital raised thus far.
Also,I notice this is open ended, so I wonder how you are getting around creating more shares? I assume you have a big bundle, but does this have any affect on dividends, ie do you have to do multiple dividends to negate the excess shares in holding for further bond sales.
Final question. When do you believe you will no longer need further capital and stop the bond issuance? Already the value on FIN-U shares is below your price due to the mass market flooding of them. I wouldn't call this bad, as I have picked up a sizable portion well below cost, but just curious.
Cheers, Ricdic
Sick of the waits with empire research slots? Use mine! |
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