Capital Partnership

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Partnership-based business model proposedd by Chris Cook of Open Capital


Description

Chris Cook:

"whereby production, or the revenues from the sale of production, of a productive asset are shared between the "Investor" member, and the User of Investment (which can be an entity of any type or legal form).

This allows the "Unitisation" of production or revenues in a simple new way ... as ... proportional shares with no "par" value." (http://www.socialedge.org/discussions/funding/new-model-for-angel-investment/document_view)

Examples

Chris Cook:

""The Art of Flirting LLP" was a framework for a film of that name.

The actors all received "Units"; I got 5%, and the producer got the rest. However, we needed £10k for lights, cameras etc, and the producer sold 20% of his share of gross revenues (if there are any) in exchange for the £10k.

The result was "Equity" funding within the LLP framework, and extremely tax efficient, because as is optional with US LLC's (I understand) UK LLP's are tax transparent or "pass through" and the investors may offset their £10k loss against other income.

In this model, the function of banks will be to bring investors together with investments in the gross revenues or production of productive assets. ie Investment Banking.

For affordable housing, we believe this model wipes the floor with any other, since there is no capital repayment, and we aim for an index-linked rental which is then unitised. This rental may be set at a rate below bank rates. For renewable energy, we can finance the average wind turbine simply by selling maybe 40% of its future production to investors either as proprtional shares or even in redeemable Kilowatt Hour "Units" (not unlike "Deli Dollars")." (http://www.socialedge.org/discussions/funding/new-model-for-angel-investment/document_view)