Earnest Capital is live

Re:Earnest Capital is live by nodesocket on Wednesday February 13, 2019 @02:27PM (#19155964)

Any idea the total number of investments you are looking to make a year? Handful, dozens?

Is there a limit on the term? Let's say you invest $100,000 in a $3k MRR business. Unfortunately it does not grow, or maybe even MRR declines. What happens to the investment obligation?

[ Parent | on HN ]

Re:Earnest Capital is live by tylertringas on Wednesday February 13, 2019 @06:06PM (#19158042)

10-12 per year.

There's no limit. If the business stalls at $3k MRR (ie no Founder Earnings) it can go on running forever or shut it down. We would get a % if it was ever sold.

[ Parent | on HN ]

Re:Earnest Capital is live by nodesocket on Wednesday February 13, 2019 @06:25PM (#19158179)

Thanks for the reply. So if after accepting investment, if the company does not work out and has to shut down, is there a personal liability owned back to Earnest Capital by the founders?

Second, can you explain the valuation cap in terms of acquisition. Let's say I take $100k in investment, and 5 years later I sell the company for $10M. What is the max amount Earnest Capital will receive?

[ Parent | on HN ]

Re:Earnest Capital is live by tylertringas on Wednesday February 13, 2019 @07:07PM (#19158428)

No personal liability. We assume some of these investments will fail for us.

% of the sale would be roughly $100k / Valuation Cap (which is negotiable at time of investment).

[ Parent | on HN ]