A beautiful example that business CAN be made simple and sweet:
“But first, there are a million ways to spin-off a company. And most of them are fucking complicated. Complicated stuff is anathema to us at Basecamp, so anything messy, extensively lawyer-y, protracted, knotty, or otherwise elaborate was off the table. So what was simple?
… So we decided to give Claire half of it. We’d own 50%, she’d own 50%. Her 50% wouldn’t cost her anything.
We wanted her, she was up for the challenge, and the money that she would have to normally come up with to buy-in wasn’t an amount that mattered enough to us to put any hurdles in the way of making it happen. Plus, we didn’t have to mess around with silly valuations either. Why complicate things?
We’d maintain that 50/50 partnership until she generated $1,000,000 in new sales. It could take 3 weeks, it could take 3 months, it could take 3 years. The $1,000,000 was cumulative — she’d hit it whenever she hit it. And when she did, we’d flip the partnership in her favor. She’d now own 75%, and we’d own 25%. And that’s how it would run in perpetuity.”
The source post includes the actual term sheet:
First I came across this article about negative interest spotted in the wild. I was surprised to see this manifest so soon. Things seem to be moving faster.
But then I came across this even more interesting article about negative interest backfiring. Basically a person who just manages to get by from a monthly income and is trying to save for retirement, watches with worry, when any saving she is able to set aside (without investing it in any risk-related monetary tools) shrinks due to negative interest.
There seems to be a conflict between the underlying story of negative interest and the underlying story of prevalent money / economics. The latter is a story of unlimited economic growth – a growth imperative rooted in interest is built into it. Negative interest, however, comes from a story in which money is in a constant state of healthy flow – systems of either steady-state or degrowth economics. It seems that prevalent economic, in its religious clnging to the growth imperative, is trying to subvert negative interest for its own means – to induce economic growth. But apparently that is not working.
To get an idea of what an alternative “retirement fund” could be we need to look past money and to reflect about the functions we expect it to provide. Lets say that when I retire I want to know that I will have a place to live, access to good food and people who will be able to support and care for some of my needs as I become less able to do so myself. What if instead of setting aside money to be able to buy these things in the future I could invest money I currently have in social enterprises that would create infrastructure that could provide me with those services. The level of my investment in these services would determine the level of service that could be made available for me when I retire
Near zero interest rates and a destablized global economy make it very difficult to create money-based savings for retirement. Now imagine negative interest applied in such a world. Instead of worrying about future value of money or watching it lose its value sitting in a savings account would it not be a better option to invest it in social enterprises that would provide me what I would like to have when I retire?
It seems we are arriving at negative interest for wrong reasons – to extend the myth of econmoic growth. That may lead to a deeper problem: that we then dismiss negative interest as a failed tool and reject it in the future. I hope we can realize and discern that the conditions are not yet right for negative interest. That it is better understood as a tool that needs to be applied in the context of other tools and changes … in service of transforming the underlying story of money instead of prolonging the one that is currently failing us.
“… Macroeconomics, he argues, is like a science that has not only stalled for three decades, but has actually gone backwards in its ability to understand reality.
In the late 1970s, as the old certainties of Keynesianism collapsed, a new generation of economists moved the discipline on to the terrain of super-abstract equations. Their assumption was that the economy tends towards equilibrium, and that only unpredictable shocks from outside the system can disturb it. Since the shocks come from outside, for the purposes of these mathematical models, the economist has to imagine what they might be. In The Trouble With Macroeconomics, Romer mocks these imaginary disruptions …
Romer is a doyen of the profession, and from the heart of the US academic mainstream. His attack on some of the most esteemed and influential economists of our time is a big thing …
… Romer, scathingly, calls this “post-real” economics, and suggests a horribly simple explanation for its popularity: human frailty … over-confidence, “an unusually monolithic community”, near-religious group loyalties, a tendency to disregard results that don’t match the theory – and too little consideration of the risks of being wrong.
This is not just a problem for economics. Romer says the parallels between bad physics and bad economics suggest there might be a “general failure mode” in any discipline that becomes over-reliant on maths. Basically, the kudos goes to people at the cutting edge of designing mathematical models, not to those whose models match reality. If Romer is right, there are big implications for the way governments and central banks make policy. Instead of abstract models, you would need something much closer to reality – and, with the rise of computer simulation technologies, that is close at hand.
… In an agent-based model, you don’t try to work out whether a million people will, on aggregate, buy more bread or less bread. You create a million digital “people” and unleash them in world with digital bread and digital money.”
Paul Romer – The Trouble With Macroeconomics
“… Cryptocurrencies are having crises of governance — Bitcoin about blocksize and other scaling strategies, Ethereum because the hard fork they made to try to save DAOhub in the midst of its crisis of having no way to authorize an update to a buggy smart contract. Plenty of other coins and systems have had their own issues along the way as well.
These problems are not incidental to the design of these systems, they are inherent.
Cryptocurrencies were designed to escape oppressive governance. Their creators have focused on optimizing personal autonomy and anonymity. The fact that we don’t know who stole $65 million from DAOhub or even who the original creator Bitcoin is, should make this fact obvious.
Why does this matter?
Any system that can’t regulate itself dies. If it can’t respond, adapt, or evolve, it’s dead.
The kind of governance we’re seeking is best thought of as a self-regulatory community. In other words, a community which has the necessary information, communication flows, and feedback loops to regulate its health and longevity.
Until people and community, along with the information flows required for that community to see its own patterns and issues are actually built into the ontology of cryptocurrencies, they won’t solve the problem of governance and collective self-regulation.”
also see Preparing Bitcon for a Hard Fork
A fascinating article in its abstract ideas and in the amazing obviousnesses in which it is disconnected from human experience … a marvelous heartless existence … the “people” traveling in these cars … why would they be there in the first place … why go anywhere to see anything when a “livestreamed HD panoramic view can be projected in helmet that responds to your head and eye movements” can be made available to you … a profound example of intellect run-amok …
“The opportunity to multitask while traveling could make the journey into the destination. Given the expanded possibilities of what one could do inside a vehicle, our existing distinctions between vehicles and buildings, between transit and destination, between static and mobile spaces, may begin to blur. Imagine commuting while sleeping, or socializing at happy hour while the bar transports you home. Imagine if a garage was also the car. If commuting entails being in a space that is functionally equivalent to being at home, one might eventually skip returning home, and commute perpetually. The journey to work could commence as soon we fall asleep. The idea of having a destination becomes as obsolete as drivers and cars. Highways would host listless roaming bedrooms, meandering through the night.
Our understanding of a house as a stable locus of physical and emotional shelter could become diluted. There would be no reason for homes to not also be vehicles. A range of new options for customizing these vehicle-home hybrids would emerge: Homes could be made up of modular docking pods, and specific rooms could be shared, swapped, rented out, or sent away for cleaning or restocking. Modern conveniences that we currently take for granted — such as being able to use a bathroom without needing to arrange for its presence in advance — could become tomorrow’s luxuries. The homeless would be the only people not constantly in motion, the people closest to retaining a fixed physical location called home. Stasis would become homelessness.”