Best MUSIC DAC launch model for 2014?

[Stan]

less likely to complain about not getting their 45%.

It amazes me how quickly an entitlement mentality sets in.
The social consensus is for 10%.

Developers can allocate the remaining 80% however they think will allow them to outmaneuver their competition.

http://bitshares.org/10-natural-laws-of-the-crypto-asset-universe/

The music industry has Big Elephants stomping around.
BitShares music must be prepared to take them on head to head.
This will take a Big War Chest.
Let's not make the assumption that accumulating any amount of resources is too much.

In this doge-eat-doge world, the name of the game is to
leave no room for someone to clone your software and field a more competitive DAC.

Cob's job is to generate a massive fast-rolling stone that gathers all the moss in its path.

Period.

[oco101]

if you want buzz and more people in the boad, maybe accept some coins with good trading volume

1. BTC
2. LTC
3. DOGE

so far everyone else ignors the alt communities, maybe this would be the right move. If you get the doge community you will get a lot of good marketers on our side.

Hmm I think this is could be a  good idea. It is true is easier to just accept bitcoin, but in the same time I think you'll bring a lot of new blood if you'll accept LTC  and dodge this will be a first. Almost every ICO has only used bitcoin so why not give it a try ? Also bitUSD I'm pretty sure will be ready by the time you start the pre sale.

[arhag]

Ah! I see where the confusion may lie.
You seem to think there is a link between third party developers and PTS/AGS.
PTS and AGS were a way to donate to invictus innovations, now called BitShares. Whatever money was sent to them was to make a bitshares toolkit.
BitShares is not launching ANY products. They are merely developers writing software for corporations to launch.
Corporations can use their software under 1 condition and 1 condition only. You allocate 10% of whatever you launch to PTS holders and 10% to AGS. No other strings attached.
Somehow you seem to think Cédric Cobban and Eddie Corral received funds from AGS or PTS.

Well said. Personally, I was even fine with the 10% to AGS, 10% to PTS model. What I wasn't fine with was a small group of founders owning such a large share of the equity in the beginning of the DAC. I think 10% to the BitShares Music Foundation, x% to AGS, x% to PTS, and the rest (90 - 2*x)% for a pre-sale/IPO is great. Obviously, x >= 10, but I am not sure what the best number should be. It depends on what are people's initial valuation of the DAC, and what the expected expenses will be for development/marketing/legal for the DAC and supporting infrastructure (PeerTracks) during the early initial growth phase. For later phases, and for unexpected expenses that can turbocharge growth, a dilution mechanism, if necessary, will work well.

Whatever specific allocation you guys decide on, you need to provide justification for it. And kicking the can down the road by saying inflation will solve all of the funding needs doesn't help. People need to have some estimation of the inflation they can expect when deciding how to initially values NOTES at launch. We need to see a more detailed business plan (the posted whitepaper is not enough) explaining what exactly provides value to NOTES and how you intend to do it. We need some estimation of the expected costs (development, business relations, marketing, legal, etc.) needed to create an ecosystem that is large enough that it can sustain itself off profit or even some light dilution if necessary for strategic expenses. I think if people had a much better idea of what the grand vision is, the economics of the system that make the DAC profitable, the unique risks involved, and how expensive it really is to achieve all of this, they would be less likely to complain about not getting their 45%. Uncertainty is only going to hurt the public image of this project and also likely result in a lower initial market cap / IPO funding.

[Stan]

...

No it's not pointless. The IPO sets an initial market cap. In the 20% case a 1:5 ratio of course.
Also after the IPO an sell off wouldn't be needed.
The devs wouldn't have to wait for buy support to be build, only to wreck it by dumping for development costs.

This is about as succinctly as I've ever seen it said. 

[tonyk]

from: dat peg doe on Today at 09:39:57 PM

Now the next step is to mentally accept the 'Music Foundation' is not getting any free share allocations. (i.e. no 10% reserved share). Getting the hard cash should be good enough. ( if you want some Notes, feel free to buy some in the IPO)

You are saying that when a company goes public it should not be allowed to retain any stock?
The funds people sent them to develop the product should be used to buy up stock in order to have a say/votes in the project?


I do not say you "should not", I am just saying it is double dipping in my book. It is more clearer (i.e. perceived as more fair, the other way).
...At the end of the day, any one of those can result in the same final share allocation...

[bitmeat]

I can't possibly imagine that any further Bitshares DACs would not be using BTSX as a funding solution. Create an asset and fund it with BitUSD, jeesh, this should be part of the social contract going forward.

[cob]

So I guess the PTS/AGS snapshot will be INDEPENDENT of the presale? you launch the presale AFTER the snapshot?

Snapshot is Oct 10th. Pre-sale will be later than that. Need time to market it and hype it up OUTSIDE of the BitShares world. Let's get some outside capital in here.

My initial thoughts are:

1. I don't feel that we are so much in a crypto booming. Especially with bitcoin price dropping from the beginning of the year

Price is irrelevant. VCs and angel investors are looking for start ups with potential to put in their capital.

2. What happens if BTC drops in price much faster than notes? You will spend very fast all the bitcoins for future development and not raise so much money. Consider also the possibility that not many people learn or invest on the IPO so with few bitcoins, few people earn more shares and dilute PTS-AGS shareholders. This will create a bad image for the PTS and raise questions for their purpose in acquiring in advance shares for future DACs. I have already seen a lot of new members asking why to invest in PTS now and not wait when the DAC is launched.

Nothing is stopping the Foundation for hedging it's funds. If it want's to sell off EVERYTHING it has for fiat, it can. The pre-sale will be done in Bitcoin, but nothing is stopping it from selling some off for Euros, canadian dollars, DOGE lol

3. You do give the opportunity to new people to participate through PTS. I don't understand why you think that an IPO will be different and will bring more members in our community. The same persons that are likely to invest through IPO might as well invest by buying PTS and keep them for the next DACs.

People spending their money on PTS raises exactly ZERO dollars for the Music project. So why bring it up? Your goal is to own a DAC that has wealth behind it no?

4. Definitely agree imposing a cap to the dilution from the delegates in order to avoid selling pressure.

Yes and let's see what Bytemaster comes up with in his other thread.

5. Isn't the 10% of the Foundation sufficient for the development of the DAC especially if it is to be worth billions?

Please re-read the original post.
Summary:
-The foundation has zero dollars.
-at launch, it will have notes
-it will need to DUMP THEM ALL to fund development, marketing, partnerships, etc.
-Price crashes
-people sell off
-New people not interested
-people will park their wealth elsewhere
-everyone gets aids (seriously re-read the first post)

Now the next step is to mentally accept the 'Music Foundation' is not getting any free share allocations. (i.e. no 10% reserved share). Getting the hard cash should be good enough. ( if you want some Notes, feel free to buy some in the IPO)

You are saying that when a company goes public it should not be allowed to retain any stock?
The funds people sent them to develop the product should be used to buy up stock in order to have a say/votes in the project?

The 3rd step is to accept bitUSD (in addition to BTC) - the positives are numerous let's name a few:
- Hedge against possible (likely in my mind) BTC price movement;
- Support for the whole Bitshares eco-system (which your Music DAC is a part of now, and we all hope grown part of it);

If it can be implemented simply. But I remember Toast telling me we would not be ready for this yet. Will have to bring it up again.

While this would be great, we shouldn't forget that we are still using test wallets, not a final product.
I think this would create a great barrier for new investors.

Ah yes! That was the main reason why (:

Do you have expenses that require both 10% to the foundation and then another 20%? Basically you're saying the foundation should get 30% up front?

Do we have expenses!? haha hmm yes.
And I don't understand where you are getting that 30% from. The foundation gets 10%. The 20% is going to whoever buys the publicly available Notes in the pre-sale. They are never in control of the foundation. Genesis block means 35% to PTS, 35% to AGS and 20% to Pre-sale. Foundation gets 10%.

Also the whole presale thing seems like a completely unnecessary ritual. If you just say 30% goes to the foundation then you can just sell that. I think the presale idea is bad.

I think you also missed something in the original post. Of course we can dump Notes at launch. The point of this thread is that it's not a good idea to crash the price of a baby blockchain when instead you can just spend bitcoin to fund devs and marketing and lawyers.

New investors can just buy PTS if they want to get shares prior to launching.

Once again, how does buying PTS off of an exchange pay for a DAC exactly?

I don't understand why you think that an IPO raising bicoins will attract new people.

I speak from personal experience. I know many people that bought into Ethereum and maidsafe that where previously NOT fans. The IPO got them interested "hmmm am I missing out if I don't read up on this project?"

New people will get attracted by buying PTS in advance as long as this is well communicated to them.

Which helps no one except the PTS seller, whoever that may be.

The IPO is pointless. If they just pre-allocate 30% to themselves it's the exact same effect. Once the shares hit the exchange they can sell off some of it.

So the question is why did they originally offer 45/45/10 and now they want to do 35/35/30?

There is no way that is seriously still "the question" not if you've read the first post of this thread.

If people wanted to get in then what was AGS/PTS for? What about those people?

So now AGS/PTS has to compete with some presale operation? I can see the point that presales can generate hype but AGS/PTS already generated hype. Tell them to buy AGS/PTS.

Dilution is barely acceptable but I don't see any benefit to this idea. What exactly does it gain?

Ah! I see where the confusion may lie.
You seem to think there is a link between third party developers and PTS/AGS.
PTS and AGS were a way to donate to invictus innovations, now called BitShares. Whatever money was sent to them was to make a bitshares toolkit.
BitShares is not launching ANY products. They are merely developers writing software for corporations to launch.
Corporations can use their software under 1 condition and 1 condition only. You allocate 10% of whatever you launch to PTS holders and 10% to AGS. No other strings attached.
Somehow you seem to think Cédric Cobban and Eddie Corral received funds from AGS or PTS.

Let's do an exercise in empathy everyone. Say tomorrow you decide to launch a DAC. *close your eyes and imagine friends!*
You have a cool idea and decide to go forward with it. Good for you! What's your first step? Are you a lawyer? Can you code everything yourself? CAn you market it yourself? hmmm I know. I pay people with mad skills to do what I can't!
First stop, the bank. How much do I have in the bank?

*ok open your eyes now*

How many of you had over 200 000 USD in their bank accounts?

OK. start problem solving (:

I think more then a few of you will think up "Oh! what if I have a pre-sale!"

[clayop]

I would suggest 40/40/20 allocation. PTS/AGS have 40% of the Notes each, and 20% will be sold in presale and consequently will go into dev fund.

[amencon]

If we go for a pre-sale. It will be a Bitcoin only AGS style one. Only shorter, 30 to 60 days yes.

I think only 10% should go to pre-sale. 20% to pre-sale is too high.

Also at what price should the presale be? It has to be higher than what PTS and AGS paid for it otherwise it's at the expense of PTS and AGS. PTS and AGS was like the initial pre-sale. People donated and got shares.

Why should the cost of Notes obtained by PTS cost less than those bought directly through a pre-sale? 

In fact I think it makes sense to have some Notes for sale cheaper at the pre-sale, that way investors have a choice.  If they believe in I3 and the DAC toolkit being developed they can pay a bit more and get shares in all future DACs following the social consensus or if they are really only interested in the Music DAC specifically they can get shares for just that at a small discount rate.

I do agree that it will be a bit disappointing if direct sale Notes end up being orders of magnitude cheaper than what I paid for the PTS/AGS that grant me Notes, but considering that 70% are going to PTS/AGS investors I doubt that will be the case.

[Shentist]

if you want buzz and more people in the boad, maybe accept some coins with good trading volume

1. BTC
2. LTC
3. DOGE

so far everyone else ignors the alt communities, maybe this would be the right move. If you get the doge community you will get a lot of good marketers on our side.

[amencon]

If we go for a pre-sale. It will be a Bitcoin only AGS style one. Only shorter, 30 to 60 days yes.

Personally I agree, this would be my preferred way to handle a pre-sale.  No fixed price, long enough to generate sales and buzz but not too long where it drags on forever.

My initial reaction to any sort of dilution scheme is negative, but that's not necessarily fair.  I certainly agree that if there will be dilution it should happen later and only if needed.

I think the question will be if outside pre-sale participants are put off by how large a stake is being awarded to PTS/AGS holders.  Same for how they will feel for paying for shares that are planned to be diluted in the future.

Honestly though no matter what scheme you guys come up with, there will be some that like and some that won't.  All things considered I think the current strategy you've come up with is a pretty good one.  Thanks for taking community suggestions into account before making a final decision on this.

Good luck, hope the pre-sale, DAC and peertracks in general are successes.  I've already shared this idea with some of my friends and will share it to a larger audience when there is something concrete to point them at.

[tonyk]

Sounds great. I agree that a pre-sale would generate some buzz and give people another chance to get in. This seems like a fair revised allocation.

My only added suggestion is to not have the pre-sale drag on and on. AGS lasted for too long. I'd go with 30-60 days maximum unless you need more time to develop the product.

If people wanted to get in then what was AGS/PTS for? What about those people?

So now AGS/PTS has to compete with some presale operation? I can see the point that presales can generate hype but AGS/PTS already generated hype. Tell them to buy AGS/PTS.

Dilution is barely acceptable but I don't see any benefit to this idea. What exactly does it gain?

$$$$
You know, the oil that makes the world go round? The stuff that buys you bulldozers in order to make big holes instead of diggin' by hand... (in as per of one of BM's post's today)

[mf-tzo]

well I am still not convinced that you will attract more new supporters from an IPO. I believe that the same people buying into PTS will buy in the IPO. It will end up to be a game theory as to how many will buy through the IPO vs. through PTS.

That is why I would think that an IPO (small percentage) would make sense only if it was to be made in bitusd so it supports development if needed, but also BTSX ecosystem by showing more confidence in that system.

If I feel that I have a large % like the 45% announcement, I will not dump it because I would feel important in that DAC. I will not dump a single % at launch.. If I have a small % I would think, ooo fuck it why bother, let's sell it and buy some BTSX or whatever... I think psychology plays a very important role but maybe it is just me..



 

[santaclause102]

I wouldn't allocate 30% to presale. It's too much imo. Investors who participate in presale basically seek to short-term profit; they are dumpers. In addition, if we allocate too many Notes to presale, the average price will be lowered, especially given the situation that crypto-market is experiencing recession, and then this will generate negative effects on AGS/PTS holders.

And it is not 'only 5%' because initial suggestion was 45%. 15 out of 45 is a quite big difference.

I fully agree with that quote

I'd disagree because sufficient starting capital and new supporters (also for the whole bitshares ecosystem!) are so crucial. Thinking in terms of exponential growth and giving away first helps a lot in my experience! A balance has to be found...

[graffenwalder]

well i am against the IPO. But I understand the need to raise capital for development. So if you do make an IPO I would like this to be in bitusd. This would be a very good chance to show to everyone how each DAC support the other.

Why raise any bitcoins or PTS? You want capital? Get it via Bitusd and convert that to usd when needed...

The IPO is pointless. If they just pre-allocate 30% to themselves it's the exact same effect. Once the shares hit the exchange they can sell off some of it.

So the question is why did they originally offer 45/45/10 and now they want to do 35/35/30?

They are asking for more money without justifying why it's necessary other than because they can.

No it's not pointless. The IPO sets an initial market cap. In the 20% case a 1:5 ratio of course.
Also after the IPO an sell off wouldn't be needed.
The devs wouldn't have to wait for buy support to be build, only to wreck it by dumping for development costs.