The General Theory of Privately Funded Blockchain Features

[shiggidy]

Wow... 

[rgcrypto]

Could you flesh out a little how you think that would be done?

Because it requires new code, in particular this first instance of it.   It would just be a stipulation in a worker proposal to issue the asset.  Its a new kind of asset; I don't know what to call it; or its an [enhanced]UIA.   BM seemed to imply he's got an idea about this already.

I suppose there could be dynamic parameters and control given to the committee or perhaps something new with Vote functionality.  It might have its own committee of share holders.  IDK.  Or it might have no adjustable parts just be set and forget.   

This one might have a programmatic buy back at some rate.  Or maintains a bid and issues dividends.   
This would be easy to dial-in to a particular profit level, or an eternal royalty if you used dividends.

The pool of collected fees would just be added to the bid.

What else does it really need to do?

Wow...that is awesome.

If it's BitShares that issue the token it could give us enough gray zone to prevent falling pray to regulatory bodies.
Worker proposals could have as an "option" the issuance of a token people can buy, sell and trade? As well as automatically perform tasks such as buyback and distribution of dividends?

Seems to me like the definition of a smart contract.

Again...wow.

[onceuponatime]

Could you flesh out a little how you think that would be done?

Because it requires new code, in particular this first instance of it.   It would just be a stipulation in a worker proposal to issue the asset.  Its a new kind of asset; I don't know what to call it; or its an [enhanced]UIA.   BM seemed to imply he's got an idea about this already.

I suppose there could be dynamic parameters and control given to the committee or perhaps something new with Vote functionality.  It might have its own committee of share holders.  IDK.  Or it might have no adjustable parts just be set and forget.   

This one might have a programmatic buy back at some rate.  Or maintains a bid and issues dividends.   
This would be easy to dial-in to a particular profit level, or an eternal royalty if you used dividends.

The pool of collected fees would just be added to the bid.

What else does it really need to do?
 

Thanks @Xeldal

Will add this idea to our discussions tomorrow.

[Xeldal]

Could you flesh out a little how you think that would be done?

Because it requires new code, in particular this first instance of it.   It would just be a stipulation in a worker proposal to issue the asset.  Its a new kind of asset; I don't know what to call it; or its an [enhanced]UIA.   BM seemed to imply he's got an idea about this already.

I suppose there could be dynamic parameters and control given to the committee or perhaps something new with Vote functionality.  It might have its own committee of share holders.  IDK.  Or it might have no adjustable parts just be set and forget.   

This one might have a programmatic buy back at some rate.  Or maintains a bid and issues dividends.   
This would be easy to dial-in to a particular profit level, or an eternal royalty if you used dividends.

The pool of collected fees would just be added to the bid.

What else does it really need to do?


 

[onceuponatime]

The mall analogy while useful, only doesn't hold up because we are not bound by physical space, so the lifetime lease issue is a moot point.  It's really a matter of how useful a feature will remain for what length of time, and when will it be replaced or amended and how do we as a community decide to handle these cases, who is making these agreements, and what is the process for negotiating?  I personally think that a general, boiler plate agreement would be best in most cases, since it would provide something which is generally lacking around here, which is a standard operating procedure for how things get done.  Case by case is costly.  I say let investors make a case to make an exception to the boiler-plate agreement and otherwise don't mess with it.  We already have so many moving parts as it is.

The analog to physical space in a mall is transaction bandwidth on the blockchain.  Any new business on the chain needs to pay for the resources it consumes, plus a profit for the BitShares platform which is itself trying to be a profitable business.

I think the market will eventually home in on a few standard operating procedures but we are all still exploring this space so I'm not sure we yet know what to standardize on.

The answer will probably be, "Whatever works" 

That said, regulatory complexities will eventually drive us to implement certain built-in templates that help everyone stay out of trouble.

Regulatory Concerns  http://www.cuttingedgecapital.com/what-is-a-security-and-why-does-it-matter/

Regarding the STEALTH initiative:

if I (or a group of partners) contribute all the capital for developing the feature, and bear all of the risk of the feature being unprofitable, and then take for myself/ourselves the feature's share of the  income stream - then there would be no regulatory risk. (This I am willing to do - but it seems that the community for, whatever reasons, is hesitant to vote in such a proposal).

Conversely, if I make available the opportunity for the community to participate through a UIA, which then makes the proposal much more likely to get voted in, I/we will come under considerable regulatory risk.

It seems that the regulatory risk incurred under the second scenario must be compensated sufficiently to pay for me to up and move to a friendly jurisdiction 

I don't see the need to have you or anyone else to issue the asset.    The network could issue the asset, perhaps through a worker proposal. This Network Issued Asset (NIA) could be purchased by anyone or automatically returned if a threshold is not met, etc.  Noone needs to stand behind it and take the legal heat.   Does this make sense?

Could you flesh out a little how you think that would be done?

[Stan]

The mall analogy while useful, only doesn't hold up because we are not bound by physical space, so the lifetime lease issue is a moot point.  It's really a matter of how useful a feature will remain for what length of time, and when will it be replaced or amended and how do we as a community decide to handle these cases, who is making these agreements, and what is the process for negotiating?  I personally think that a general, boiler plate agreement would be best in most cases, since it would provide something which is generally lacking around here, which is a standard operating procedure for how things get done.  Case by case is costly.  I say let investors make a case to make an exception to the boiler-plate agreement and otherwise don't mess with it.  We already have so many moving parts as it is.

The analog to physical space in a mall is transaction bandwidth on the blockchain.  Any new business on the chain needs to pay for the resources it consumes, plus a profit for the BitShares platform which is itself trying to be a profitable business.

I think the market will eventually home in on a few standard operating procedures but we are all still exploring this space so I'm not sure we yet know what to standardize on.

The answer will probably be, "Whatever works" 

That said, regulatory complexities will eventually drive us to implement certain built-in templates that help everyone stay out of trouble.

Regulatory Concerns  http://www.cuttingedgecapital.com/what-is-a-security-and-why-does-it-matter/

Regarding the STEALTH initiative:

if I (or a group of partners) contribute all the capital for developing the feature, and bear all of the risk of the feature being unprofitable, and then take for myself/ourselves the feature's share of the  income stream - then there would be no regulatory risk. (This I am willing to do - but it seems that the community for, whatever reasons, is hesitant to vote in such a proposal).

Conversely, if I make available the opportunity for the community to participate through a UIA, which then makes the proposal much more likely to get voted in, I/we will come under considerable regulatory risk.

It seems that the regulatory risk incurred under the second scenario must be compensated sufficiently to pay for me to up and move to a friendly jurisdiction 

I don't see the need to have you or anyone else to issue the asset.    The network could issue the asset, perhaps through a worker proposal. This Network Issued Asset (NIA) could be purchased by anyone or automatically returned if a threshold is not met, etc.  Noone needs to stand behind it and take the legal heat.   Does this make sense?

Yes.  That's what I meant by:

"That said, regulatory complexities will eventually drive us to implement certain built-in templates that help everyone stay out of trouble."

Exercise for the student:

Define the requirements for such a template.

[Xeldal]

The mall analogy while useful, only doesn't hold up because we are not bound by physical space, so the lifetime lease issue is a moot point.  It's really a matter of how useful a feature will remain for what length of time, and when will it be replaced or amended and how do we as a community decide to handle these cases, who is making these agreements, and what is the process for negotiating?  I personally think that a general, boiler plate agreement would be best in most cases, since it would provide something which is generally lacking around here, which is a standard operating procedure for how things get done.  Case by case is costly.  I say let investors make a case to make an exception to the boiler-plate agreement and otherwise don't mess with it.  We already have so many moving parts as it is.

The analog to physical space in a mall is transaction bandwidth on the blockchain.  Any new business on the chain needs to pay for the resources it consumes, plus a profit for the BitShares platform which is itself trying to be a profitable business.

I think the market will eventually home in on a few standard operating procedures but we are all still exploring this space so I'm not sure we yet know what to standardize on.

The answer will probably be, "Whatever works" 

That said, regulatory complexities will eventually drive us to implement certain built-in templates that help everyone stay out of trouble.

Regulatory Concerns  http://www.cuttingedgecapital.com/what-is-a-security-and-why-does-it-matter/

Regarding the STEALTH initiative:

if I (or a group of partners) contribute all the capital for developing the feature, and bear all of the risk of the feature being unprofitable, and then take for myself/ourselves the feature's share of the  income stream - then there would be no regulatory risk. (This I am willing to do - but it seems that the community for, whatever reasons, is hesitant to vote in such a proposal).

Conversely, if I make available the opportunity for the community to participate through a UIA, which then makes the proposal much more likely to get voted in, I/we will come under considerable regulatory risk.

It seems that the regulatory risk incurred under the second scenario must be compensated sufficiently to pay for me to up and move to a friendly jurisdiction 

I don't see the need to have you or anyone else to issue the asset.    The network could issue the asset, perhaps through a worker proposal. This Network Issued Asset (NIA) could be purchased by anyone or automatically returned if a threshold is not met, etc.  Noone needs to stand behind it and take the legal heat.   Does this make sense?

[onceuponatime]

The mall analogy while useful, only doesn't hold up because we are not bound by physical space, so the lifetime lease issue is a moot point.  It's really a matter of how useful a feature will remain for what length of time, and when will it be replaced or amended and how do we as a community decide to handle these cases, who is making these agreements, and what is the process for negotiating?  I personally think that a general, boiler plate agreement would be best in most cases, since it would provide something which is generally lacking around here, which is a standard operating procedure for how things get done.  Case by case is costly.  I say let investors make a case to make an exception to the boiler-plate agreement and otherwise don't mess with it.  We already have so many moving parts as it is.

The analog to physical space in a mall is transaction bandwidth on the blockchain.  Any new business on the chain needs to pay for the resources it consumes, plus a profit for the BitShares platform which is itself trying to be a profitable business.

I think the market will eventually home in on a few standard operating procedures but we are all still exploring this space so I'm not sure we yet know what to standardize on.

The answer will probably be, "Whatever works" 

That said, regulatory complexities will eventually drive us to implement certain built-in templates that help everyone stay out of trouble.

Regulatory Concerns  http://www.cuttingedgecapital.com/what-is-a-security-and-why-does-it-matter/

Regarding the STEALTH initiative:

if I (or a group of partners) contribute all the capital for developing the feature, and bear all of the risk of the feature being unprofitable, and then take for myself/ourselves the feature's share of the  income stream - then there would be no regulatory risk. (This I am willing to do - but it seems that the community for, whatever reasons, is hesitant to vote in such a proposal).

Conversely, if I make available the opportunity for the community to participate through a UIA, which then makes the proposal much more likely to get voted in, I/we will come under considerable regulatory risk.

It seems that the regulatory risk incurred under the second scenario must be compensated sufficiently to pay for me to up and move to a friendly jurisdiction 

[Stan]

The mall analogy while useful, only doesn't hold up because we are not bound by physical space, so the lifetime lease issue is a moot point.  It's really a matter of how useful a feature will remain for what length of time, and when will it be replaced or amended and how do we as a community decide to handle these cases, who is making these agreements, and what is the process for negotiating?  I personally think that a general, boiler plate agreement would be best in most cases, since it would provide something which is generally lacking around here, which is a standard operating procedure for how things get done.  Case by case is costly.  I say let investors make a case to make an exception to the boiler-plate agreement and otherwise don't mess with it.  We already have so many moving parts as it is.

The analog to physical space in a mall is transaction bandwidth on the blockchain.  Any new business on the chain needs to pay for the resources it consumes, plus a profit for the BitShares platform which is itself trying to be a profitable business.

I think the market will eventually home in on a few standard operating procedures but we are all still exploring this space so I'm not sure we yet know what to standardize on.

The answer will probably be, "Whatever works" 

That said, regulatory complexities will eventually drive us to implement certain built-in templates that help everyone stay out of trouble. 

[lovejoy]

Stan: Neither Hippy, nor Redneck... discuss. 
https://www.youtube.com/watch?v=MhliLCJKZGA

Back on topic.  I think this is one killer development!  Thanks @onceuponatime for bringing this to the fore, talk about putting your money where your mouth is!  UIA's profit sharing in feature development will fuel the the next wave of development.  And thanks @Samupaha for starting this thread!

The mall analogy while useful, only doesn't hold up because we are not bound by physical space, so the lifetime lease issue is a moot point.  It's really a matter of how useful a feature will remain for what length of time, and when will it be replaced or amended and how do we as a community decide to handle these cases, who is making these agreements, and what is the process for negotiating?  I personally think that a general, boiler plate agreement would be best in most cases, since it would provide something which is generally lacking around here, which is a standard operating procedure for how things get done.  Case by case is costly.  I say let investors make a case to make an exception to the boiler-plate agreement and otherwise don't mess with it.  We already have so many moving parts as it is.

[rgcrypto]

I'm in favor of not having any one standardized way to fund new features.

By standardizing I mean that we have to formalize the process how share-UIAs are created and used.

So far one of the biggest problems for Bitshares has been that many wonderful features lack both technical documentation and newbie-friendly explanations how things actually work.

I do not want that we will repeat the mistake once again. So what we have to do?

We have to design the share-UIA so that it can be used in many ways. There is no need to limit it to be only "20 % forever" or similar. Let it have broad variation of parameters that are set when it is created.

There should be only one share-UIA – I suppose it is the best way, because then we don't need to be hardforking and designing new kinds of UIAs all the time and the blockchain will stay simple. That one UIA just has to be versatile enough.

We have to document with sufficient detail every parameter, so that everybody knows that they are there and what they can be used for.

We have to also explain what this funding model is good for and what it is not. People need to have enough information about the system so they can evaluate their business plans themselves without flooding our forum with stupid questions.

We are going to the uncharted lands. If we want others to follow us, we need to draw some maps for them. So far not enough people have been following us, thanks to lacking documentation. They just don't know where the hell we are going and what there is. That's why I created this thread. I want us to discuss this new system so thoroughly that we can explain it to others and they will become as enthusiastic as we are. They have to see the possibilities we see. They have to be able to fully use every possibility that our system presents for them.

very good....whatever the configuration, we do need well understood, supported, documented and easily repeatable processes

If we go on a case by case basis, in my opinion,  that information will be available on the sales page for the UIA.

If the community don't like it, they can start a worker proposal to cut the grass under the feet of the private investor or start their own crowd funding with better terms.

[Ben Mason]

I'm in favor of not having any one standardized way to fund new features.

By standardizing I mean that we have to formalize the process how share-UIAs are created and used.

So far one of the biggest problems for Bitshares has been that many wonderful features lack both technical documentation and newbie-friendly explanations how things actually work.

I do not want that we will repeat the mistake once again. So what we have to do?

We have to design the share-UIA so that it can be used in many ways. There is no need to limit it to be only "20 % forever" or similar. Let it have broad variation of parameters that are set when it is created.

There should be only one share-UIA – I suppose it is the best way, because then we don't need to be hardforking and designing new kinds of UIAs all the time and the blockchain will stay simple. That one UIA just has to be versatile enough.

We have to document with sufficient detail every parameter, so that everybody knows that they are there and what they can be used for.

We have to also explain what this funding model is good for and what it is not. People need to have enough information about the system so they can evaluate their business plans themselves without flooding our forum with stupid questions.

We are going to the uncharted lands. If we want others to follow us, we need to draw some maps for them. So far not enough people have been following us, thanks to lacking documentation. They just don't know where the hell we are going and what there is. That's why I created this thread. I want us to discuss this new system so thoroughly that we can explain it to others and they will become as enthusiastic as we are. They have to see the possibilities we see. They have to be able to fully use every possibility that our system presents for them.

very good....whatever the configuration, we do need well understood, supported, documented and easily repeatable processes

[Samupaha]

I'm in favor of not having any one standardized way to fund new features.

By standardizing I mean that we have to formalize the process how share-UIAs are created and used.

So far one of the biggest problems for Bitshares has been that many wonderful features lack both technical documentation and newbie-friendly explanations how things actually work.

I do not want that we will repeat the mistake once again. So what we have to do?

We have to design the share-UIA so that it can be used in many ways. There is no need to limit it to be only "20 % forever" or similar. Let it have broad variation of parameters that are set when it is created.

There should be only one share-UIA – I suppose it is the best way, because then we don't need to be hardforking and designing new kinds of UIAs all the time and the blockchain will stay simple. That one UIA just has to be versatile enough.

We have to document with sufficient detail every parameter, so that everybody knows that they are there and what they can be used for.

We have to also explain what this funding model is good for and what it is not. People need to have enough information about the system so they can evaluate their business plans themselves without flooding our forum with stupid questions.

We are going to the uncharted lands. If we want others to follow us, we need to draw some maps for them. So far not enough people have been following us, thanks to lacking documentation. They just don't know where the hell we are going and what there is. That's why I created this thread. I want us to discuss this new system so thoroughly that we can explain it to others and they will become as enthusiastic as we are. They have to see the possibilities we see. They have to be able to fully use every possibility that our system presents for them.

[complexring]

Redneck friends.
Hippies don't wear overalls.

Not true.

[Ben Mason]

I think 20% for the life of the feature (after initial capital recovered) is a good deal for everyone.....it may provide an incentive to investors/businesses to develop the highest quality / most robust / most profitable features, to develop those features in order to maintain revenue stream.

Market competition for quality is good, i agree with Stan that a flat 20% gives everyone interested a well understood calculation and prevents community paralysis and unpleasant haggling.

Crowdfunded or individual, external business or existing community member.....all funding proposals should be considered.   UIA option a great addition.....

This is wonderfully exciting!

[Stan]

Redneck friends.
Hippies don't wear overalls.

[tonyk]

That's just my INTJ opinion.

One too many INTJ at one place at a time... in my not so humble INTP opinion

[Stan]

I'm in favor of not having any one standardized way to fund new features.

But I think the one that will be the most successful will follow the crowd funding model (we won't get guys with a perspective like onceuponatime all that often).

Given that assumption, certain market forces take over.  To raise the necessary funds, the sweetest deal possible will have to be presented to the investors to get them to chip in.  That will drive it towards offering investors a lion's share of the new features' revenue in perpetuity.  (If not, a second proposal will pop up almost immediately offering those better terms and siphoning off investors from the weaker proposal).

That will leave the rest of the voters sitting around wondering if they should hold out for someone else to implement the feature in a way that pays more to the network.  They will probably wait a long time.

Eventually a lot of fully-funded proposals that have been sitting there for a long time waiting for voter approval and doing nothing for BTS network will start to get voted in.

So it will come down to an equilibrium between what investors are willing to fund and what bitshareholders are willing to vote for.  In this deal, I believe the investors will have the upper hand because the voters are going to want to see all that raised money get spent and will have no real way to negotiate with what will have become a take-it-or-leave it offer from the investors.  Time will run out on that money being returned to the investors with no real guarantee that it can be raised again with a lesser deal.

And so most voters will conclude that a bird in the hand is sufficient.

That's just my INTJ opinion.

[Akado]

What's the problem of lifetime royalties? You know that lifetime royalties != 100% fees right? They will only get a part of that? BitShares will get the rest? Meaning BTS also has a feature that will stay around forever plus make profit from it? Plus the priceless exposure and new costumers?

Wtf is wrong with you people. You prefer going down and drag others with you instead of benefiting from something, just because someone will make more money than you - in theory - from it, while that person clearly is taking the risk. What a joke.

Royalties are usually higher in the beginning till someone makes their money back because of the risk and that's obvious and then they start getting lower when that person starts seeing profit.

You're making it sound like a lifetime sentence where BitShares won't ever see a penny from fees ever again. That's ridiculous. It's a win-win situation, plus you're not the one taking the risk, what's there even to think about? Some people are just egoistic.

@BunkerChain Labs
eager to see when that's announced, if it ever is. Obviously I'm not buying the millions of users part, that would make Bitcoin as it is, insignificant. I only buy that in the sense that it might have the potential to do that in 20 years, only because the chances of that happening are already so low. Otherwise that statement was not written properly.

If you read what I wrote in the context of this thread.. you will see I was just making an illustrated point.. based on a real life scenario I just happen to have instead of just  theories.

Nothing is set in stone.. they could decide to not just take my input and look around this forum for example.. get spooked by all the entitlement talk and other businesses attempting to do business with Bitshares get told how to do their own business.. and just decide to go the other way.

Threads like this one for example where people are talking about limiting their ROIs after they invest the money to do something just drives business opportunity away. It's like trying to plant seeds and tell them/forcing them to never  grow beyond 2" above ground.

They will just find another place to grow.

I wasn't saying what you've accomplish does not have value, I was criticizing how it was said but I understood it wasn't meant to be taken literally.

I agree on the second part. I don't understand what's there not to like, giving it will only bring BTS more income. It's plain nonsense. You're offered to make more profit, for free. Instead you refuse because whoever is offering you that might get more than you... Plain nonsense, but seems to be the thinking of some people, unfortunately.

I say implement all the features you want, as long as BTS profits from it.

[rgcrypto]

If BTS want's to own all of the stealth transaction fees, then it needs to place a competing bid against NoMoreHeroes.  Otherwise let nomorepurchase the feature and get royalties... It's still a massive risk on his part.

There is always the possibility to buyout nomoreheroes if he is ever in the position to sell.

I don't often find myself agreeing with you @lil_jay890 , but on that one I do. If BTS holder want to get 100% of the future profits of this new feature, they need to start getting their head out of their butt and promote a worker proposal. It's always appreciated if onceuponatime wants to reduce his risk and sell UIA to us. But I don't think he should be obligated to do so. If we want to attract investors and devs, we need to make it IRRESISTABLE for them to want to build features, pay for them and get maximum rewards for it. Like I said, FREE features, no risk to us and more transaction fees if the feature is successful...

The people who oppose giving maximum return to investors for giving us is a new feature at no cost to us is "pound foolish". Yes, we provide the infrastructure but THAT IS THE REASON WE CHARGE TRANSACTION FEES. If the feature isn't successful there is no downside for BTS holders.

[lil_jay890]

This is my theory:

In order to get a sense for whether this is a good deal for BTS holders , it would help to express the deal in known terms/concepts. I hope others can help to make the below more accurate:

The suggested deal offers a funding for a 75% royalty until the investment is recovered and a 25% life long royalty once the investment is recovered.

Does anyone know what (more or less) "standard" funding conditions for royalty deals are?

The royalty is basically a third option for compensation of the opportunity costs of capital besides interest (loans) or equity. Background: https://en.wikipedia.org/wiki/Revenue-based_financing

This assumes you frame it as a "royalty" instead of a tenant business renting infrastructure on our "shopping mall" platform. 

When a business based on recruiting new customers (e.g. OpenLedger) moves onto our platform, the system gets 20% and the business gets 80% for life.

When a business based on adding a capital improvement (e.g. stealth transfers) moves onto our platform, should they get anything less?  (Keep in mind, we want that business to continue to be profitable so it can afford to grow that business with new features and promotions.)

If we want to encourage businesses of either type to flock to our platform (growing its network effect and generating fees and attracting users for every other member business) we can't make the rent they must pay too high and certainly not 100% after some period of time.

In the end, charging 20% of earnings for use of our platform seems reasonable and something most investors would view as fair. 

A flat 20% is what we have done for share drops.
A flat 20% is what we have done for referrals.
A flat 20% is probably the right answer for tenant businesses.

If you want to maximize the number of tenant businesses.

No mall is ever going to sign a LIFETIME lease, they would be shutting themselves out of possibilities for no reason. They might as well just sell the property outright. If that's what you're suggesting, fine, but are you sure you want to sell 20% of all stealth tx business for only 45k? We shouldn't consider this in terms of some unspoken tradition - let's keep it to a simple business calculation: lifetime 20% is just a BAD DEAL. Bad, one sided deals where one party is left unhappy only lead to future problems.

The reason we can offer lifetime to affiliates is that there can be unlimited number of them and they only make money by producing users.  A stealth tx monopolist has no incentive to bring users, he can sit back and let others do it.

If BTS want's to own all of the stealth transaction fees, then it needs to place a competing bid against NoMoreHeroes.  Otherwise let nomorepurchase the feature and get royalties... It's still a massive risk on his part.

There is always the possibility to buyout nomoreheroes if he is ever in the position to sell.

[Shentist]

as i see it "stealth transfer" is a wallet feature and so it is not a core feature for the blockchain

i think a UIA for the wallet is here a better solution

anyone can still do the same with a different UIA and take the profits for stealth transfer.

with a UIA we will have so much more to gain

1. a asset for the bitshares exchange - so more people are attracted to use bitshares
2. the risk that this feature will not be used are given to the UIA investors
3. and this for a lifetime of 20% of the transaction fee is a no brainer - because for a normal transaction the network gets only 20% and the rest goes to referral anyway, so the
BTS holders are loosing nothing at all.
4. this will set the path for many no UIA projects, so much, much more use of the exchange and if you are using bitshares anyway, just use the trading for altcoins and using the
trading with bitassets and using all the features in the future.

i believe we have one of the best core technic in place we need a way to attract faster more projects and they will give more people exposure to our product.

[triox]

This is my theory:

In order to get a sense for whether this is a good deal for BTS holders , it would help to express the deal in known terms/concepts. I hope others can help to make the below more accurate:

The suggested deal offers a funding for a 75% royalty until the investment is recovered and a 25% life long royalty once the investment is recovered.

Does anyone know what (more or less) "standard" funding conditions for royalty deals are?

The royalty is basically a third option for compensation of the opportunity costs of capital besides interest (loans) or equity. Background: https://en.wikipedia.org/wiki/Revenue-based_financing

This assumes you frame it as a "royalty" instead of a tenant business renting infrastructure on our "shopping mall" platform. 

When a business based on recruiting new customers (e.g. OpenLedger) moves onto our platform, the system gets 20% and the business gets 80% for life.

When a business based on adding a capital improvement (e.g. stealth transfers) moves onto our platform, should they get anything less?  (Keep in mind, we want that business to continue to be profitable so it can afford to grow that business with new features and promotions.)

If we want to encourage businesses of either type to flock to our platform (growing its network effect and generating fees and attracting users for every other member business) we can't make the rent they must pay too high and certainly not 100% after some period of time.

In the end, charging 20% of earnings for use of our platform seems reasonable and something most investors would view as fair. 

A flat 20% is what we have done for share drops.
A flat 20% is what we have done for referrals.
A flat 20% is probably the right answer for tenant businesses.

If you want to maximize the number of tenant businesses.

No mall is ever going to sign a LIFETIME lease, they would be shutting themselves out of possibilities for no reason. They might as well just sell the property outright. If that's what you're suggesting, fine, but are you sure you want to sell 20% of all stealth tx business for only 45k? We shouldn't consider this in terms of some unspoken tradition - let's keep it to a simple business calculation: lifetime 20% is just a BAD DEAL. Bad, one sided deals where one party is left unhappy only lead to future problems.

The reason we can offer lifetime to affiliates is that there can be unlimited number of them and they only make money by producing users.  A stealth tx monopolist has no incentive to bring users, he can sit back and let others do it.

[Samupaha]

Can we come up with a good name for the share-UIA? Here are some examples I've been thinking today:

Dappcoin
Dappshare   
Featureshare (IMO too difficult to pronounce for some non-english speakers)
Royaltycoin
Roicoin (ROI = return on investment)
Sharecoin
Featurecoin
Featcoin (my favourite so far, short to write and easy to pronounce, although might be misheard for "feetcoin" or "fitcoin")

[Samupaha]

Agreed, but I don't think it must be viewed as a "monopoly".  OpenLedger will have many exchanges using it and it makes our platform more robust, not necessarily more complicated.  Individual wallets and web sites can decide which of several alternative implementations they want to make available to their customers (hiding or automating choices if there are too many.)

How many versions of iouUSD will we have?  Let the best DAPPs win!  (And don't tax them to death.)  Business platforms never get the lion's share of a businesses revenue.  We need to be lightweight if we want to attract businesses.

Shopping malls don't usually limit how many shoe stores can move in.  In fact, stores of a feather often flock together.

Even Apple's outrageous rates for getting onto the iPhone don't go so far as to demand the lion's share and 100% after some period of time.  BitShares is not big enough (yet) to charge Apple's confiscatory rates.

As with everything, metaphor selection matters.

Yeah, I understand your point. I was mostly thinking private transfers now that the stealth transfer is the first example of privately funded feature. I don't think it would be very good user experience if there was ten different ways to make private transfers (too much hassle to find out what is the best and what others are using). Also wallet developers might get frustrated when there is always coming new features  that do not really add anything new. And wouldn't it also make the blockchain use more resources?

[santaclause102]

This is my theory:

In order to get a sense for whether this is a good deal for BTS holders , it would help to express the deal in known terms/concepts. I hope others can help to make the below more accurate:

The suggested deal offers a funding for a 75% royalty until the investment is recovered and a 25% life long royalty once the investment is recovered.

Does anyone know what (more or less) "standard" funding conditions for royalty deals are?

The royalty is basically a third option for compensation of the opportunity costs of capital besides interest (loans) or equity. Background: https://en.wikipedia.org/wiki/Revenue-based_financing

This assumes you frame it as a "royalty" instead of a tenant business renting infrastructure on our "shopping mall" platform. 

When a business based on recruiting new customers (e.g. OpenLedger) moves onto our platform, the system gets 20% and the business gets 80% for life.

When a business based on adding a capital improvement (e.g. stealth transfers) moves onto our platform, should they get anything less?  (Keep in mind, we want that business to continue to be profitable so it can afford to grow that business with new features and promotions.)

If we want to encourage businesses of either type to flock to our platform (growing its network effect and generating fees and attracting users for every other member business) we can't make the rent they must pay too high and certainly not 100% after some period of time.

In the end, charging 20% of earnings for use of our platform seems reasonable and something most investors would view as fair. 

A flat 20% is what we have done for share drops.
A flat 20% is what we have done for referrals.
A flat 20% is probably the right answer for tenant businesses.

If you want to maximize the number of tenant businesses.

Isn't the difference between something like Open ledger and the feature investor that open ledger can easily be replaced by something that does better marketing because it has a better wallet etc. (-> OL is on the business layer) and the feature is hard coded into bitshares and guarentees to generate profit from EVERYONE that uses that feature (no need to innovate more like OL has to to keep the profits coming).
BUT if, like Samupaha pointed out just above this post, that the feature we are talking about here can easily be replaced with a better feature (ring signature or so) then it's a totally different picture.
That would have WIDER implications. Maybe this is even a way to bring competition among those that produce features (this is an advantage that Ethereum has: Competition for the best app / specific feature /solution). Thinking thinking....

[BunkerChainLabs-DataSecurityNode]

What's the problem of lifetime royalties? You know that lifetime royalties != 100% fees right? They will only get a part of that? BitShares will get the rest? Meaning BTS also has a feature that will stay around forever plus make profit from it? Plus the priceless exposure and new costumers?

Wtf is wrong with you people. You prefer going down and drag others with you instead of benefiting from something, just because someone will make more money than you - in theory - from it, while that person clearly is taking the risk. What a joke.

Royalties are usually higher in the beginning till someone makes their money back because of the risk and that's obvious and then they start getting lower when that person starts seeing profit.

You're making it sound like a lifetime sentence where BitShares won't ever see a penny from fees ever again. That's ridiculous. It's a win-win situation, plus you're not the one taking the risk, what's there even to think about? Some people are just egoistic.

@BunkerChain Labs
eager to see when that's announced, if it ever is. Obviously I'm not buying the millions of users part, that would make Bitcoin as it is, insignificant. I only buy that in the sense that it might have the potential to do that in 20 years, only because the chances of that happening are already so low. Otherwise that statement was not written properly.

If you read what I wrote in the context of this thread.. you will see I was just making an illustrated point.. based on a real life scenario I just happen to have instead of just  theories.

Nothing is set in stone.. they could decide to not just take my input and look around this forum for example.. get spooked by all the entitlement talk and other businesses attempting to do business with Bitshares get told how to do their own business.. and just decide to go the other way.

Threads like this one for example where people are talking about limiting their ROIs after they invest the money to do something just drives business opportunity away. It's like trying to plant seeds and tell them/forcing them to never  grow beyond 2" above ground.

They will just find another place to grow.

[Stan]

For me it's not clear how that lifetime thing would work. Are we selling a monopoly for a certain feature or is some competition possible? What if shareholders later want to abandon that particular code in favour of a different implementation? It just feels to me like this could cause a lot of political trouble. But maybe I'm wrong.

Important question!

Let's look the incentives.

Investor:
- does have incentives for marketing the feature and not charging too much fees (otherwise he doesn't get users and BTS owners might get angry)
- does have incentives for making the feature better over time (decreases the competition coming from similar features, makes users more satisfied)

BTS owner:
- does have incentives for giving monopoly for feature as long as it works reasonably well (otherwise other developers are less interested in offering new features)
- doesn't have incentives for implementing several features that give same service (makes whole system too complicated)

So yeah, this might get us in trouble, but I guess it will work most of the times. Developers and investors propably understand that "lifetime" means lifetime of the feature – it is very possible that the feature becomes obsolete some day in the future. And BTS owners understand that it is best to give some kind of monopoly even when there is no explicit contract.

Agreed, but I don't think it must be viewed as a "monopoly".  OpenLedger will have many exchanges using it and it makes our platform more robust, not necessarily more complicated.  Individual wallets and web sites can decide which of several alternative implementations they want to make available to their customers (hiding or automating choices if there are too many.)

How many versions of iouUSD will we have?  Let the best DAPPs win!  (And don't tax them to death.)  Business platforms never get the lion's share of a businesses revenue.  We need to be lightweight if we want to attract businesses.

Shopping malls don't usually limit how many shoe stores can move in.  In fact, stores of a feather often flock together.

Even Apple's outrageous rates for getting onto the iPhone don't go so far as to demand the lion's share and 100% after some period of time.  BitShares is not big enough (yet) to charge Apple's confiscatory rates.

As with everything, metaphor selection matters.

[Samupaha]

A 25% life long royalty seems a bit much to me and probably is far away from the standard royalty deals. Just a guess though

When Bitshares and the investor are making the deal, we should discuss what kind of lifetime there is to be expected. For example, stealth transfers might get replaced by ring signature transfers in some point if our users demand it. So it is entirely possible that sometimes the investor do not get back all of his investment because the feature becomes obsolete earlier than he has anticipated.

And there might be cases when it's difficult to estimate what the total investment has been. Somebody could make the feature on their free time just for fun and then offer it for Bitshares in exchange for share-UIA.

From Bitshares' point of view, we should always examine every case individually and accept it only if we see that it will generate benefits for us. Developers and investors can make their own calculations, I don't think we should care that much when they get their whole investment back and start to generate profit.

Bitshares should be mainly interested in whether the feature will bring us more users and transaction fees or not and what is the price we have to pay for it. Only price we care is defined in the parameters of the share-UIA. If we think it's too expensive, we can decline and wait for somebody else to make cheaper offer, or fund the feature ourselves from the reserve pool.

[Stan]

This is my theory:

In order to get a sense for whether this is a good deal for BTS holders , it would help to express the deal in known terms/concepts. I hope others can help to make the below more accurate:

The suggested deal offers a funding for a 75% royalty until the investment is recovered and a 25% life long royalty once the investment is recovered.

Does anyone know what (more or less) "standard" funding conditions for royalty deals are?

The royalty is basically a third option for compensation of the opportunity costs of capital besides interest (loans) or equity. Background: https://en.wikipedia.org/wiki/Revenue-based_financing

This assumes you frame it as a "royalty" instead of a tenant business renting infrastructure on our "shopping mall" platform. 

When a business based on recruiting new customers (e.g. OpenLedger) moves onto our platform, the system gets 20% and the business gets 80% for life.

When a business based on adding a capital improvement (e.g. stealth transfers) moves onto our platform, should they get anything less?  (Keep in mind, we want that business to continue to be profitable so it can afford to grow that business with new features and promotions.)

If we want to encourage businesses of either type to flock to our platform (growing its network effect and generating fees and attracting users for every other member business) we can't make the rent they must pay too high and certainly not 100% after some period of time.

In the end, charging 20% of earnings for use of our platform seems reasonable and something most investors would view as fair. 

A flat 20% is what we have done for share drops.
A flat 20% is what we have done for referrals.
A flat 20% is probably the right answer for tenant businesses.

If you want to maximize the number of tenant businesses.

[santaclause102]

But there has to be an end date so that bts share holders can make money from it in the future.

But that's the beauty of it -- BTS shareholders do profit from it, by getting exponentially improved features and a flood of new users who are drawn to BTS by the new features. So I'm also in the lifetime revenue camp; no end date necessary. It really does seem to be win-win-win all around, and I feel this could prove to be the most exciting BTS development in a long while.

On first sight I would be ok with life time royalties but at beter conditions. A 25% life long royalty seems a bit much to me and probably is far away from the standard royalty deals. Just a guess though

[santaclause102]

This is my theory:

In order to get a sense for whether this is a good deal for BTS holders , it would help to express the deal in known terms/concepts. I hope others can help to make the below more accurate:

The suggested deal offers a funding for a 75% royalty until the investment is recovered and a 25% life long royalty once the investment is recovered.

Does anyone know what (more or less) "standard" funding conditions for royalty deals are?

The royalty is basically a third option for compensation of the opportunity costs of capital besides interest (loans) or equity. Background: https://en.wikipedia.org/wiki/Revenue-based_financing

[Samupaha]

yes this would be good but the private investors should never get eternal royalties.

They should get royalties until they have made a good return on their investment for example doubled their money. But there has to be an end date so that bts share holders can make money from it in the future.

Why should BTS as a blockchain get eternal royalties but other investors in features can't?

Bitshares isn't getting any royalties, it is collecting fees for compensation for blockchain use.

I agree that it would be good thing to have some point when royalties end, but I would leave that to be decided when the UIA is created. If investors demand lifetime royalties, and BTS owners really want the feature, then there will be lifetime royalties. In Bitshares the shareowners are the highest authority on decisions – if they accept LTR, so be it.

But whether there is lifetime royalties or not, Bitshares has to get compensation for filling up the blockchain with transactions. Otherwise BTS owners will end up subsidizing usage of the feature (then it is only us who will pay for witnesses and keep the blockchain alive, not users or investors of the feature).

Edit: We actually have LTR already: referral income. There is no end date on how long you can get a share from payments from the account you referred (unless the account is updated to lifetime membership).

[Samupaha]

For me it's not clear how that lifetime thing would work. Are we selling a monopoly for a certain feature or is some competition possible? What if shareholders later want to abandon that particular code in favour of a different implementation? It just feels to me like this could cause a lot of political trouble. But maybe I'm wrong.

Important question!

Let's look the incentives.

Investor:
- does have incentives for marketing the feature and not charging too much fees (otherwise he doesn't get users and BTS owners might get angry)
- does have incentives for making the feature better over time (decreases the competition coming from similar features, makes users more satisfied)

BTS owner:
- does have incentives for giving monopoly for feature as long as it works reasonably well (otherwise other developers are less interested in offering new features)
- doesn't have incentives for implementing several features that give same service (makes whole system too complicated)

So yeah, this might get us in trouble, but I guess it will work most of the times. Developers and investors propably understand that "lifetime" means lifetime of the feature – it is very possible that the feature becomes obsolete some day in the future. And BTS owners understand that it is best to give some kind of monopoly even when there is no explicit contract.

[Akado]

What's the problem of lifetime royalties? You know that lifetime royalties != 100% fees right? They will only get a part of that? BitShares will get the rest? Meaning BTS also has a feature that will stay around forever plus make profit from it? Plus the priceless exposure and new costumers?

Wtf is wrong with you people. You prefer going down and drag others with you instead of benefiting from something, just because someone will make more money than you - in theory - from it, while that person clearly is taking the risk. What a joke.

Royalties are usually higher in the beginning till someone makes their money back because of the risk and that's obvious and then they start getting lower when that person starts seeing profit.

You're making it sound like a lifetime sentence where BitShares won't ever see a penny from fees ever again. That's ridiculous. It's a win-win situation, plus you're not the one taking the risk, what's there even to think about? Some people are just egoistic.

@BunkerChain Labs
eager to see when that's announced, if it ever is. Obviously I'm not buying the millions of users part, that would make Bitcoin as it is, insignificant. I only buy that in the sense that it might have the potential to do that in 20 years, only because the chances of that happening are already so low. Otherwise that statement was not written properly.

[complexring]

I'm fine with lifetime royalties as long as they're decreasing over time. So say it's 80% until they recoup their investment, then 20% and halving every four years until finally it stays at 1% forever. If BitShares is successful that's 1% of a multi billion $ activity.

As BM said in the other thread: the feature needs to be able to fund it's own development and upgrades.
With time the original code developed with the original investment will get less and less relevant so it only makes sense that it'll receive decreasing share in profit.

This is much more reasonable than 25% lifetime after initial investment has been recoup'ed.

Although, I like the idea of community crowdfunding for features via UIA as opposed to investors with pre-existing capital -- although not generally opposed. 

Something like a 50/50 partnership with investors and the community would be a good compromise as well.  This allows for investors with larger capital to provide the bulk of the funds necessary to develop a feature AND allows the community to support, and also profit, from a feature being implemented as well.

The point is that there's no reason not to allow private investors to develop a feature, allow them to take the risks and, potentially, the rewards.  But, it'd be nice to allow others to get in on the action who do not have the same type of capital reserves.  Otherwise, we're building a system that is still inherently an oligarchy in design that benefits those with pre-existing capital. 

I understand that all bts owners benefit when such a feature is implemented, but why can't some of us benefit more, if we are willing to pony up the dough?

tl;dr

25% lifetime is too much.  1% is nice.  Allow for potential public / private, i.e. community / private, initiatives to fund features. 

[rgcrypto]

I don't get the entitlement of shareholders on any featured paid by a third party. First, we get the feature for free. Second, if the investor brings in new users, the shareholders of BTS get the transaction fees. That's the only cut we are entitled with are transaction fees unless they do a crowd funding on the platform with User issued assets. Unlimited upside is what's going to attract investors...and we have only gained.

[Empirical1.2]

Unless you are putting your own money up, you have no say in how this feature gets coded.

Shareholders in BTS do have a say in how/what gets coded on BTS.

[triox]

I'm fine with lifetime royalties as long as they're decreasing over time. So say it's 80% until they recoup their investment, then 20% and halving every four years until finally it stays at 1% forever. If BitShares is successful that's 1% of a multi billion $ activity.

As BM said in the other thread: the feature needs to be able to fund it's own development and upgrades.
With time the original code developed with the original investment will get less and less relevant so it only makes sense that it'll receive decreasing share in profit.

[Empirical1.2]

I am hearing some people complaining about ongoing fees or % etc going to those that invested to make them.. but the fact is if the company is going to be operating something that is going to bring tens of millions of users (not kidding), think of all the other transactions and activity this is going to bring Bitshares.

I just hope the community will see past being pound foolish as @Stan put it earlier when we bring proposals like this to create new decentralized businesses that will build on BitShares and bring their entire user base to it.

Omg, 'tens of millons of users (not kidding)' hype and 'pennywise pound foolish' metaphors, you were certainly right to reference the master of hype there

when the choice under discussion is whether to decline to spend 3% to fund development and marketing targeting several orders of magnitude (10 x 10 x 10...) growth, we have a proposition that falls pretty clearly in to the category of "penny wise and pound foolish" 

I hope it's an exciting prospect though, just color me skeptical on the tens of millions of users part for the time being.

yes this would be good but the private investors should never get eternal royalties.

They should get royalties until they have made a good return on their investment for example doubled their money. But there has to be an end date so that bts share holders can make money from it in the future.

Why should BTS as a blockchain get eternal royalties but other investors in features can't?

Yeah what Ethereum has going for it is that third parties can easily build onto the platform and keep a lot of the profits they make. This means a third party would rather fund an Ethereum app than BTS blockchain addition without some lifetime profits. Given that BTS can't afford to pay a lot via dilution, funding some features in this way is a good solution if it doesn't want to be ruthlessly outpaced.

BTS should be allowed to support multiple implementations of that feature, provided they are sufficiently different so survival of the fittest can occur and so we're not tied into only supporting an outdated privacy feature for example  when technology evolves.

The privacy feature is a borderline case as it might delay other needed development if it's prioritised first by CNX. It also doesn't require a lot of external help once it's implemented.

A prediction market though for example is something that would cost more and probably needs to be separately managed and so needs a seperate group interested in specifically developing, marketing and making it a success long term. So that is an example of a feature that would highly benefit from a revenue sharing model.

[cube]

yes this would be good but the private investors should never get eternal royalties.

They should get royalties until they have made a good return on their investment for example doubled their money. But there has to be an end date so that bts share holders can make money from it in the future.

Why should BTS as a blockchain get eternal royalties but other investors in features can't?

It is not the BTS the blockchain getting eternal royalties.  It is the BTS SHAREHOLDERS who should be getting eternal royalties.  BTS shareholders are the ones who sponsored the development of bitshares foundation platform, without which there will not be any privatised features to be built upon.  BTS shareholders have been holding on to their bts unwavering despite the long downturn in bts price. 

BTS shareholders have every rights to determine how these private investors are to be compensated for the capital they put up in building new the privatised features.  The shareholders need to be mindful of how the new development will impact/delay the current development schedule.

Edit: I just discover the mysterious invester is 'onceuponatime' - a long-time bts investor and supporter.  He has my full respect and support.

[BunkerChainLabs-DataSecurityNode]

Here is a real life scenario without going into a lot of details.

Someone recently contacted me to consult on a project. They have the option to either create their own private chain or build their business on BitShares.

One way would mean they own it all top to bottom.

The other would be to attempt to navigate the bitshares community, and introduce various new features to the Bitshares network in order for his business to be able to run with it. It would require a Worker proposal to fork the new features.

They are looking at investing well over $100k to do this. I recommended that they should have control over the fee structure of these features and even suggested to them that we could potentially license or allow others to use these features in their own operations.

I am hearing some people complaining about ongoing fees or % etc going to those that invested to make them.. but the fact is if the company is going to be operating something that is going to bring tens of millions of users (not kidding), think of all the other transactions and activity this is going to bring Bitshares.

I just hope the community will see past being pound foolish as @Stan put it earlier when we bring proposals like this to create new decentralized businesses that will build on BitShares and bring their entire user base to it.

[luckybit]

We should try to separate two independent issues:

1.  If an entrepreneur develops a new DAPP and offers it to BitShares with a revenue sharing model, are we going to vote to install it? 

     (The first time we turn down such an offer will probably be the last time we get one.)

2.  What are all the insanely great ideas for funding such upgrades to BitShares?

We should care about any upgrade's safety, use of resources, and impact on BitShares reputation, etc..  We should not care about how the developer raised funds to develop it or speculate on her motivations for doing so.    Most especially, it is none of our business what method they use to raise their development funds.  Encourage them to innovate.

We should go forth and tell the world about all the ways there are for investors and developers to make money using the BitShares platform.  This should build interest in BitShares more than anything I can think of.  What's the  best thing about Ethereum?  Its attractive to developers.  What's most attractive to developers?  A way to profit from their efforts.

Folks who want to confiscate their profits or cap their upside are being penny wise and pound foolish.

In general, the more a developer/investor can earn from starting a new business on our blockchain, the more they are likely to reinvest in that business to make it more profitable.  That means more features, more polish, and more promotion effort from the developer/investor.  As long as BitShares is getting a cut to cover network costs and earn a profit for its own investors, everybody wins.

The more profitable businesses that are motivated to build on our platform, the more customers will use it, and the more attractive it will be for other businesses.

A virtuous cycle.

I'm sure no one really cares how they raise their funds... The biggest contention here is using funds from a worker proposal and then selling that feature to other chains.  If a company (say cnx) were to create a worker proposal for prediction markets, bts should have a right to profits from the selling that feature to any of the other chains (muse, identabit, etc) since bts is an investor.

The social consensus, it means a sharedrop onto BTS.

[luckybit]

But there has to be an end date so that bts share holders can make money from it in the future.

But that's the beauty of it -- BTS shareholders do profit from it, by getting exponentially improved features and a flood of new users who are drawn to BTS by the new features. So I'm also in the lifetime revenue camp; no end date necessary. It really does seem to be win-win-win all around, and I feel this could prove to be the most exciting BTS development in a long while.

I'm in the eternal revenue camp. If the Bitshares community is willing to fund a worker proposal then after the initial ROI is made by the private feature then the Bitshares community can do their own implementation funded by dilution.

I don't see why people who didn't put any money up should have a profit share. Why?

On the other hand if its just a GUI feature then it's not eternal, there can be other GUIs. Multiple implementations, but until you are ready to pay for those implementations via dilution you should let them have eternal royalties.

I really like the idea of people buying shares in features and getting dividends through lifetime fees. If we were to automate the creation of shares for a proposal like this one, the person/people investing the money or work-hours would own all of them, and if they'd like, they could go public to make some of their money back by selling shares. I think the ability to trade the ownership of the fees could help us with the centralization issue here, as well as give us a way to measure the profitability of different features. I guess it could be argued this could be done with the existing framework but I still like the idea of having it right on the blockchain.

Someone called it "Featureshares". Not a bad idea for marketing purposes.

[luckybit]

yes this would be good but the private investors should never get eternal royalties.

They should get royalties until they have made a good return on their investment for example doubled their money. But there has to be an end date so that bts share holders can make money from it in the future.

Why should BTS as a blockchain get eternal royalties but other investors in features can't?

[Ben Mason]

And this is where IP becomes a thorny issue that is ultimately slowing us down. If we try to compete based upon IP it is like a country trying to compete by placing tariffs on imports/exports. Ultimately the only thing that "protectionism" does is increase costs to the citizens of the country while hurting the competitiveness of the country and subsidizing unprofitable businesses.

  I'm glad to hear you take this stance.

Indeed, well said

[SpiritofJefferson]

I really like the idea of people buying shares in features and getting dividends through lifetime fees. If we were to automate the creation of shares for a proposal like this one, the person/people investing the money or work-hours would own all of them, and if they'd like, they could go public to make some of their money back by selling shares. I think the ability to trade the ownership of the fees could help us with the centralization issue here, as well as give us a way to measure the profitability of different features. I guess it could be argued this could be done with the existing framework but I still like the idea of having it right on the blockchain.

[rgcrypto]

I am down with any private investor willing to invest in features they need.

Lifetime royalties? Absolutely. As long as we have the transaction fees, I dont care if someone gets rich because on stealth transaction. Its his $45K. Someone who is willing to spend that kind of money in a feature DEFINITELY has a plan to market it and get users to use it.

If the person is willing to pay 100%, he should receive the maximum benefit he can get from it. We profit from transaction fees and WE DIDNT HAVE TO PAY FOR THE ADDED FEATURE.

As an investor, I would like if the person split the investment opportunity with the community. The person who wants to pay for the feature, would benefit to offer this has a marketing opportunity and to secure himself people who would want to promote his project.

For stealth transaction, the individual could create STEALTH (UIA)  and then sell lets say 50% of the UIA and buyback shares over time. This way, he gets 50% of all fees for a lifetime fees and we do too. Everybody win.

One thing is that this new feature need to be available for everyone to use in the future.

[TravelsAsia]

And this is where IP becomes a thorny issue that is ultimately slowing us down. If we try to compete based upon IP it is like a country trying to compete by placing tariffs on imports/exports. Ultimately the only thing that "protectionism" does is increase costs to the citizens of the country while hurting the competitiveness of the country and subsidizing unprofitable businesses.

  I'm glad to hear you take this stance.

[onceuponatime]

For me it's not clear how that lifetime thing would work. Are we selling a monopoly for a certain feature or is some competition possible? What if shareholders later want to abandon that particular code in favour of a different implementation? It just feels to me like this could cause a lot of political trouble. But maybe I'm wrong.

It seems to me that it is easy enough to abandon. Just stop using it! I'm sure that many people will never use it at all anyway.

And if someone comes up with a proposal for another stealth method, better and/or cheaper - well, competition is what it's all about.

[bytemaster]

We should try to separate two independent issues:

1.  If an entrepreneur develops a new DAPP and offers it to BitShares with a revenue sharing model, are we going to vote to install it? 

     (The first time we turn down such an offer will probably be the last time we get one.)

2.  What are all the insanely great ideas for funding such upgrades to BitShares?

We should care about any upgrade's safety, use of resources, and impact on BitShares reputation, etc..  We should not care about how the developer raised funds to develop it or speculate on her motivations for doing so.    Most especially, it is none of our business what method they use to raise their development funds.  Encourage them to innovate.

We should go forth and tell the world about all the ways there are for investors and developers to make money using the BitShares platform.  This should build interest in BitShares more than anything I can think of.  What's the  best thing about Ethereum?  Its attractive to developers.  What's most attractive to developers?  A way to profit from their efforts.

Folks who want to confiscate their profits or cap their upside are being penny wise and pound foolish.

In general, the more a developer/investor can earn from starting a new business on our blockchain, the more they are likely to reinvest in that business to make it more profitable.  That means more features, more polish, and more promotion effort from the developer/investor.  As long as BitShares is getting a cut to cover network costs and earn a profit for its own investors, everybody wins.

The more profitable businesses that are motivated to build on our platform, the more customers will use it, and the more attractive it will be for other businesses.

A virtuous cycle.

I'm sure no one really cares how they raise their funds... The biggest contention here is using funds from a worker proposal and then selling that feature to other chains.  If a company (say cnx) were to create a worker proposal for prediction markets, bts should have a right to profits from the selling that feature to any of the other chains (muse, identabit, etc) since bts is an investor.

And this is where IP becomes a thorny issue that is ultimately slowing us down. If we try to compete based upon IP it is like a country trying to compete by placing tariffs on imports/exports. Ultimately the only thing that "protectionism" does is increase costs to the citizens of the country while hurting the competitiveness of the country and subsidizing unprofitable businesses.

[Frodo]

For me it's not clear how that lifetime thing would work. Are we selling a monopoly for a certain feature or is some competition possible? What if shareholders later want to abandon that particular code in favour of a different implementation? It just feels to me like this could cause a lot of political trouble. But maybe I'm wrong.

[lil_jay890]

We should try to separate two independent issues:

1.  If an entrepreneur develops a new DAPP and offers it to BitShares with a revenue sharing model, are we going to vote to install it? 

     (The first time we turn down such an offer will probably be the last time we get one.)

2.  What are all the insanely great ideas for funding such upgrades to BitShares?

We should care about any upgrade's safety, use of resources, and impact on BitShares reputation, etc..  We should not care about how the developer raised funds to develop it or speculate on her motivations for doing so.    Most especially, it is none of our business what method they use to raise their development funds.  Encourage them to innovate.

We should go forth and tell the world about all the ways there are for investors and developers to make money using the BitShares platform.  This should build interest in BitShares more than anything I can think of.  What's the  best thing about Ethereum?  Its attractive to developers.  What's most attractive to developers?  A way to profit from their efforts.

Folks who want to confiscate their profits or cap their upside are being penny wise and pound foolish.

In general, the more a developer/investor can earn from starting a new business on our blockchain, the more they are likely to reinvest in that business to make it more profitable.  That means more features, more polish, and more promotion effort from the developer/investor.  As long as BitShares is getting a cut to cover network costs and earn a profit for its own investors, everybody wins.

The more profitable businesses that are motivated to build on our platform, the more customers will use it, and the more attractive it will be for other businesses.

A virtuous cycle.

I'm sure no one really cares how they raise their funds... The biggest contention here is using funds from a worker proposal and then selling that feature to other chains.  If a company (say cnx) were to create a worker proposal for prediction markets, bts should have a right to profits from the selling that feature to any of the other chains (muse, identabit, etc) since bts is an investor.

[Stan]

We should try to separate two independent issues:

1.  If an entrepreneur develops a new DAPP and offers it to BitShares with a revenue sharing model, are we going to vote to install it? 

     (The first time we turn down such an offer will probably be the last time we get one.)

2.  What are all the insanely great ideas for funding such upgrades to BitShares?

We should care about any upgrade's safety, use of resources, and impact on BitShares reputation, etc..  We should not care about how the developer raised funds to develop it or speculate on her motivations for doing so.    Most especially, it is none of our business what method they use to raise their development funds.  Encourage them to innovate.

We should go forth and tell the world about all the ways there are for investors and developers to make money using the BitShares platform.  This should build interest in BitShares more than anything I can think of.  What's the  best thing about Ethereum?  Its attractive to developers.  What's most attractive to developers?  A way to profit from their efforts.

Folks who want to confiscate their profits or cap their upside are being penny wise and pound foolish.

In general, the more a developer/investor can earn from starting a new business on our blockchain, the more they are likely to reinvest in that business to make it more profitable.  That means more features, more polish, and more promotion effort from the developer/investor.  As long as BitShares is getting a cut to cover network costs and earn a profit for its own investors, everybody wins.

The more profitable businesses that are motivated to build on our platform, the more customers will use it, and the more attractive it will be for other businesses.

A virtuous cycle.

[Samupaha]

A simple way to think about it.

A group of investors owns a shopping mall.  Someone approaches them and offers to build a parking garage on their property.  She offers to pay the mall owners a never-ending share of her garage's profits (after expenses) and give them the benefit of her garage making the mall more attractive for everybody's customers.

It's not about the mall owners paying her "royalties" forever, it's about her paying the mall a share of her revenue forever in exchange for rights to build on the mall's property.

Meanwhile, she has established a wonderful precedent for the mall owners who start looking for more ways to apply this model to generate more revenue and attractive features for the mall.

And yes, other projects could be crowd-funded using the same model, where those who donate are guaranteed a lifetime share of the revenue generator they helped to fund.

i like the idea

but would suggest some changes

1. make it possible that a UIA is created for the investor
2. the UIA can be in control of the committee members and the investor
3. create a automated buyback mechanism etc.
4. the fees for this UIA should only be paid on top of a normal transaction. so if a normal transaction costs 20 cent and the stealth fees say 30 cents and then split the 30 cent like discribed.

With this we can finance many more project in the pipline

you want a prediction market? done, create UIA get the project funded

with this we can create multiple automated UIA assets on our blockchain who will be traded and give our bitshares exchange some unic assets.

This is exactly what we discussed over lunch today. It seems like a great way to crowdfund features. After all the value of a feature is the present value of its projected future revenue to the network. With a few small changes it could even be set up such that a minimum amount of funding must be achieved or the BTS are returned. Very much like an automated kickstarter.

[Samupaha]

yes this would be good but the private investors should never get eternal royalties.

They should get royalties until they have made a good return on their investment for example doubled their money. But there has to be an end date so that bts share holders can make money from it in the future.

Yeah, this is important question. But I wouldn't throw away lifetime royalties yet.

The investor could decide how the profits are paid. It could be based on:
- time (royalties are paid only a certain time, then shares become worthless)
- payback of invested money (royalties are paid until investors have got back what they paid plus some profit)
- lifetime royalties (royalties are paid forever)
- combinations?
- any other possibilities?

Just because the lifetime royalties opportunity exists, that doesn't mean it will be used very time. BTS-holders should vote on every proposal and propably not many would accept lifetime royalties. That would force most of the proposals to implement some other way to collect profits.

Propably lifetime royalties would be used only if somebody comes up with a totally unique invention that is desperately wanted by everybody, and he wont implement it in the Bitshares if he doesn't get lifetime royalties.

[tonyk]

But there has to be an end date so that bts share holders can make money from it in the future.

But that's the beauty of it -- BTS shareholders do profit from it, by getting exponentially improved features and a flood of new users who are drawn to BTS by the new features. So I'm also in the lifetime revenue camp; no end date necessary. It really does seem to be win-win-win all around, and I feel this could prove to be the most exciting BTS development in a long while.

+ 1

on a different note. Someone copy here @Shentist original post (and BM's response as well maybe.)

[nomoreheroes7]

But there has to be an end date so that bts share holders can make money from it in the future.

But that's the beauty of it -- BTS shareholders do profit from it, by getting exponentially improved features and a flood of new users who are drawn to BTS by the new features. So I'm also in the lifetime revenue camp; no end date necessary. It really does seem to be win-win-win all around, and I feel this could prove to be the most exciting BTS development in a long while.

[JonnyB]

yes this would be good but the private investors should never get eternal royalties.

They should get royalties until they have made a good return on their investment for example doubled their money. But there has to be an end date so that bts share holders can make money from it in the future.

[Samupaha]

Go see the New Stealth Transfer Worker ($1000) thread if you haven't yet. Somebody got an absolutely brilliant idea: he will fund the development of the stealth transfer GUI if he gets royalties from every stealth transfer after it's implemented.

We should discuss this idea in more broadly. How can we use private funding to accelerate the development of other new features for Bitshares? Can we agree on a standardized process?

I think best way to make this happen would be to issue UIA that acts like a share for the feature. The person/group/company that funds the feature gets all the shares and profits that those shares will collect in the future. When somebody uses the feature and pays for it, part of that money goes to the share-UIA and part to the blockchain.

Can anybody come up with a good name for it? Dappcoin? Featureshare?

Investor can be just one person (or a company), who develops the feature himself and then offers it to Bitshares in exchange for share-UIA. Or investor can be crowdfund group that uses the money to pay for the code.

Investor can define how many shares there will be, how much they will get profits and how long they are valid (might be forever). BTS owners then decide if this is a good deal and accept or decline it. How the process should go? Worker proposal?

Of course the share-UIA can be traded in the Bitshares exchange, if the investor wants to sell it. This should be also possible in advance for the crowdfunded projects.

This should be our highest top priority!

Why? Because right now we can fund only very few projects at a time. We get out 5 bts/s from reserve pool and that's not much with current shareprice.

With privately funded blockchain features we could develop dozens of projects at a same time! That would give an enormous boost to the development process!

We'll get lots of new users who want to buy shares for these features because they can make money with them: just buy and hold and get revenue automatically – who could resist that? We'll get lots of new developers who will earn money by coding these features. So incentives are very much in place.

I'm getting really, really nice mindblowingfullness feelings from this, anyone else?

But first we should decide how exactly this process would work, what kind of hardforks it will need, etc.