3 ms·
What do you mean by buyback in terms of revenue? * For every $X we will spend $0.0001 buying back tokens? * For every $X we will buy back Y coins? * For ever
by slivym 9y ago
What do you mean by buyback in terms of revenue?
* For every $X we will spend $0.0001 buying back tokens?
* For every $X we will buy back Y coins?
* For every $X we will buy back Y coins at a set value?
I guess it's got to be the first or third since the second would imply that the cost of buying back the coins could be greater than the revenue of the company (let's saying I buy all the coins and refuse to sell them, whachagonado?)
Basically what you're describing is selling a royalty interest with a fixed buyback value.
Which whilst technically achievable seems like a strange thing to do. Since when you're starting a company it's very difficult to calculate your margin. The result would be that you could very well end up finding that the royalty makes your company unprofitable.
- dmichulke 9y agoIMO only the first makes sense. The third would imply a "non-market" setting which kind of defeats the purpose of an ICO. The company I talked with was in the loan business, so if you set a target rate of 10% on every interest rate payment, it's possible it's gonna break your neck but then you didn't have a very good business model to begin with. The idea is that after 5 or 10 years you already bought back a decent amount of your tokens and initially you can set different buyback rates (e.g, X% for the Xth year up to 10) to "soften the blow" in case you're entering a highly competitive market (aka shark pool). The good news is that it's kind of self-regulating: if you underperform, the tokens will be worth less so your buybacks in terms of coins will be higher and your subsequent buybacks therefore cheaper.