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cosmoray
Cosmoray Construction
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Posted - 2008.12.18 17:46:00 -
[1]
I thought I might leave a little nugget of information for some of the newer players here.
If you want to invest or run a business, lets have a look at 2 new business opportunities that are both less than 2 days old on this forum:
1. Atima Industries
Aima Industries
This person is a relative unknown, but is asking for 20B ISK. That is a huge amount of trust for someone with no background reputation. But wait, the manager wasn't stupid and realised they would have a problem, so look at what they did:
Wrote a good business plan? Yes Is that a profitable business area? yes Arranged an audit with most respected auditor?yes In advance? yes Answered questions quickly? yes Provided a mechanism to secure investors funds (locked down BPO's with respected auditor)? yes
When people look at this offering, the downside is very limited, max 20% loss. Do you trust Kazuo (absolutely).
result = Sold out quickly, with more wanting to reserve.
2. 1 Billions ISK Bond at 12% (by 720)
720 Bond
Again an unknown wanting cash. Not even a large amount of cash, only 1 Billion, and paying a really good interest rate. What did 720 do.
Wrote a good business plan? yes Is area profitable? Is the person good at their job, we don't know Would audit help confirm this? yes Did CEO arrange for an audit? NO Did CEO answer questions quickly? NO Did we gain further trust from answers? NO Do we have secure feeling our money is safe? NO
Result = Unsuccessful launch (720 failed to raise the cash, and some reservation were withdrawn)
What did we learn. It is not difficult to spot really good investments. It is more difficult to pick through the average or bad ones.
If you want to invest, look at the 2 examples and ask yourself if you would invest in either.
If you want to launch a business, how would you now go about it?
Remember there is another harsh rule on these forums. It is very difficult (not impossible) to come back for a second launch if your first one was a failure!
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cosmoray
Cosmoray Construction
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Posted - 2008.12.19 18:54:00 -
[2]
Another point I should have made:
I think most investors like to invest in a "bricks and mortar business". Something that has tangible assets.
These assets hold a fixed value, that can be liquidated to repay shareholders (even though in the event of a SCAM assets get stolen too).
For a trader we are asked in blind faith to take the word of someone that they are a good trader. This is why we like to audit traders, so they can prove that they are previously successful.
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cosmoray
Cosmoray Construction
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Posted - 2008.12.19 19:48:00 -
[3]
Originally by: Ray McCormack
This will happen to lolbank btw, the directors need to have provisions in place for it.
That made my afternoon!!
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cosmoray
Cosmoray Construction
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Posted - 2008.12.19 20:15:00 -
[4]
Originally by: SiJira every time you invest you are either investing blindly or doing more work than you could do on your won with less risk
So you have turned to attacking every investor and investment that appears. I am sure this has nothing to do with the fact you failed to launch your own business?
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cosmoray
Cosmoray Construction
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Posted - 2008.12.19 23:35:00 -
[5]
720 its nothing personal, I am not attacking you. I am judging your offering.
When I did an eve-search it showed a lot of posts. I did clarify that I might have screwed that up.
The reason I want to see and audit is simple.
You say your a good trader. How do I know that. If I am an investor, I want some assurance you can do what you say you can. An audit would show your previous trading history, and would prove if your successful, and an auditor could state that.
When an audit is completed, the auditor and the CEO make an agreement. When my company was audited in June this year, my agreement with kazuo is that he will reveal the names on all my accounts to the forum if I scam. You can craft an agreement with an auditor not to reveal all your character or other things. If the scope of the audit was just to prove your trading record that could be agreed upon, in MD, in advance. If you have something genuine to hide then I am concerned enough that I probably wouldn't invest. Kazuo and the other auditors held in high regard do not want to trash their reputation divulging privelaged information.
The reason I am calling this a failure is because I see people investing in you, for a gamble. They are not investing for business reasons. The investors don't care about the funds.
I have watched over 100B ISK scammed through MD forum in last 18 months, and the vetting/questionning process is one that has morphed directly because of the scams. Now quite a few of the older players are leaving but they have left a good legacy of how IPO's are critiqued. Something to be proud of.
MY concern is that MD may turn into an IPO scamfest, and when that happens this market will again dry up, with no one investing.
Most IPO's don't die because people call SCAM. They mostly don't get the chance to try because they fail before launch because the business plan is poor or the attitude of the manager is poor.
Investors want transparency. They want to feel confident in the manager and the plan.
Keeping Politics Aside One of the consequences of some people moving over to other forums is that there is now a considerably lower amount of ISK available for players here to tap. The EBank & DBank boards are controlling 300-500B of investment capital, and the other players leaving probably account for over 500B. Most successfully launched IPO's major investors are the guys that are leaving. That is not a good thing.
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