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>Couldn't be stuff like a $500m personal loan to a startup CEO, secured by said CEOs stock in a private company that has negative cash flow and no real assets,

by o-__-o 7y ago

>Couldn't be stuff like a $500m personal loan to a startup CEO, secured by said CEOs stock in a private company that has negative cash flow and no real assets, which he also happens to control? Surely there is no reason to doubt the quality of collateral like that. As a startup CEO with available stock, an actual positive cash flow and no _real_ assets.. please tell me where I can apply for this type of loan? Because all the loans I'm looking at are 3-8% interest and requires me to sign over my personal assets as collateral in return for a paltry $250k. I'd rather use that loan to just buy more real assets for myself instead (which is what I am doing)

motohagiography 7y ago
https://www.bloomberg.com/news/articles/2019-09-19/neumann-s-lenders-seek-changes-to-his-500-million-credit-line https://www.bloomberg.com/news/articles/2019-09-19/neumann-s...
- o-__-o 7y ago
  Are you telling me the assets that WeWork owns are not real assets? Well, then, if real estate is not an asset then what qualifies as assets?
azernik 7y ago
This is a reference to Elon Musk's financial strategy, specifically https://www.reuters.com/article/us-tesla-offering-banks/elon-musk-owes-507-million-to-banks-helping-tesla-raise-capital-idUSKCN1S901E https://www.reuters.com/article/us-tesla-offering-banks/elon... Essentially, he has almost nothing in cash, and instead of selling stock to raise cash he borrows money with his stock as collateral. This is why he's so monomaniacally focused on his stock value and public image. For a more professional, but login-walled, overview, see https://www.economist.com/business/2016/10/22/countdown https://www.economist.com/business/2016/10/22/countdown
- one2zero 7y ago
  Ahh the paywall. Let me keep reloading and smash esc until i get it to load without the paywall.
  - azernik 7y ago
    It's only loginwalled; if you're okay with them having your e-mail, you can read several articles a month.
- o-__-o 7y ago
  This isn’t just Elon, Oracles Founder did the same thing. Except they actually have a company with assets. So I don’t get what OP was rambling on about “non real assets”. A fucking manufacturing plant is an asset. My servers are not. Looks like the financial world is working as it should...
  - azernik 7y ago
    The specific $500M number was a reference to Elon, but yeah, given how successful this strategy is I'm not surprised the Oracle founder uses it too. I agree with you that these cases are where the companies have tangible, provable value, even if they're not profitable right now.

by o-__-o 7y ago

motohagiography 7y ago

https://www.bloomberg.com/news/articles/2019-09-19/neumann-s-lenders-seek-changes-to-his-500-million-credit-line https://www.bloomberg.com/news/articles/2019-09-19/neumann-s...

o-__-o 7y ago
Are you telling me the assets that WeWork owns are not real assets? Well, then, if real estate is not an asset then what qualifies as assets?

azernik 7y ago

This is a reference to Elon Musk's financial strategy, specifically https://www.reuters.com/article/us-tesla-offering-banks/elon-musk-owes-507-million-to-banks-helping-tesla-raise-capital-idUSKCN1S901E https://www.reuters.com/article/us-tesla-offering-banks/elon... Essentially, he has almost nothing in cash, and instead of selling stock to raise cash he borrows money with his stock as collateral. This is why he's so monomaniacally focused on his stock value and public image. For a more professional, but login-walled, overview, see https://www.economist.com/business/2016/10/22/countdown https://www.economist.com/business/2016/10/22/countdown

one2zero 7y ago
Ahh the paywall. Let me keep reloading and smash esc until i get it to load without the paywall.
- azernik 7y ago
  It's only loginwalled; if you're okay with them having your e-mail, you can read several articles a month.
o-__-o 7y ago
This isn’t just Elon, Oracles Founder did the same thing. Except they actually have a company with assets. So I don’t get what OP was rambling on about “non real assets”. A fucking manufacturing plant is an asset. My servers are not. Looks like the financial world is working as it should...
- azernik 7y ago
  The specific $500M number was a reference to Elon, but yeah, given how successful this strategy is I'm not surprised the Oracle founder uses it too. I agree with you that these cases are where the companies have tangible, provable value, even if they're not profitable right now.