Re:Earnest Capital is live
by fragsworth on Wednesday February 13, 2019 @11:16PM
(#19159573)
It sounds to me like a critically important part of their model that they don't want you to understand or think about. There's nothing about it on their site from what I saw.
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Re:Earnest Capital is live
by tylertringas on Thursday February 14, 2019 @07:06AM
(#19161264)
The residual stake is a factor of the investment amount, the Valuation Cap (negotiated at time of investment) and the terms of a sale. Note by "stake" we just mean an option to participate in a sale. You can run the business profitably forever without paying us a penny. There is a screencast here going over every term and a spreadsheet anybody can use to run the numbers. Not hiding anything :) https://earnestcapital.com/shared-earnings-agreement-digging...
> we just mean an option to participate in a sale
By what instrument though? Are you offering a stock option at a strike price? Is it equity at a priced round? Or is a convertible note? Other? You can just say "if you sell we have the option to take a %"...