7 ms·

They are not equally invested. using your method Company fails A risked $100k money got 0. B risked $100k time got 100k money. A is now at -$100k B is at

They are not equally invested. using your method Company fails A risked $100k money got 0. B risked $100k time got 100k money. A is now at -$100k B is at zero My guess it's you'll claim A got $100k of your time so A is at 0 as well but if we follow that logic in other places we can see how it doesn't work. A pays $10 for B to make a pie B pays $10 of time to make a pie A now resells pie for $20. A does not own B any percentage of profit. That's the business success case just replace "pie" with "business". Similarly A drops pie. B does not owe A a new pie. That's the business fail case. $B got their $10 money for their $10 of time. B's risk has now been paid for. A still has a risk, that they can sell the pie. Replace "drops pie" with "business fails".

superqd 7y ago
The problem is you missed the full comparison. Person A has not the time to invest into building the product, so they invest money, 100k's worth of dollars. Person B has not the money to invest into building the product, so they invest time, 100k's worth of time. So if we compare dollars in the event of company failure, we have: Person A is now at -100k Person B is now at 100k Person A is now at +1 years Person B is now at -1 years Again, this means they both invested equally. What is usually harder to see is the time investment. But Person A gains one year of work they did not have to do on the product (via their investment). Person B loses the year they invest/spend on the product. Purchasing a product does not imply joint ownership. Consumers do not partly own the profit of the Producer. However, if A and B decided to build a pie product together then yeah, they'd split the profits. Which is what is at stake here in this overall discussion: how should profits fairly get split when two or more parties contribute the resources to build it.
- nl 7y ago
  This literally makes no sense, and it wrong even by your own math. Person A is now at -100k: Agreed Person B is now at 100k: Agreed Person A is now at +1 years: If you are valuing 1 year at 100k, then no - they are at zero years. They put in $100K over 1 year, so the two cancel each other out. Person B is now at -1 years: Again, they have been paid at the rate of $100K for 1 year, so they are at zero years. Again - I reject this "losing a year" thing. The investor hasn't gained a year at all - you can't lose or gain time. But if you value 1 year at 100K then they have paid for 1 year, but that means they have by-passed other opportunities. If they invest $100K in 2019 and the company goes bust in 2020 how have they gained a year? But even ignoring that (!!) your math doesn't work.
  - superqd 7y ago
    Let's say you have 1 year left to live. You have two things you want to do, X and Y, but X and Y take 1 year each to complete. It is the end result you want, but each result takes 1 year achieve, and you only have 1 year left to live. What can you do? Well, if you have enough money, you can pay for someone else to work on X while you work on Y. In this way, you have been able to get 2 years worth of work done, in only 1 year. In effect, you doubled the number of years you had to spend on getting things done. Spending money in exchange for someone else's work is a time multiplier on the one who spends the dollars. They get more done in less calendar time, i.e., because they effectively have more effort-time by converting their money to someone else's calendar time. The entirety of my reasoning in predicated on one simple thing: an investor trades in their money for something of equal value, and the worker trades in their time for something of equal value. This means, by definition, they are equal partners in the exchange, and hence must split the profits equally. It also means they each gained and lost equally, because they traded evenly. If you do not agree with the foundational assumption I am making, point out the error in that, as all else necessarily follows.
    - nl 7y ago
      The investor isn't trading their money for time, they are trading it for a share of a company.
    - nl 7y ago
      Also, if the company failed because they failed to deliver that thing you wanted to build does the investor get the time back? No. But the employee keeps the money. The entirety of my reasoning in predicated on one simple thing: an investor trades in their money for something of equal value, and the worker trades in their time for something of equal value. Indeed. The investor buys part of the company, and the worker gets paid for their time. If you buy shares in Microsoft you get a proportion of the company, not some weird "time" thing.

superqd 7y ago

The problem is you missed the full comparison. Person A has not the time to invest into building the product, so they invest money, 100k's worth of dollars. Person B has not the money to invest into building the product, so they invest time, 100k's worth of time. So if we compare dollars in the event of company failure, we have: Person A is now at -100k Person B is now at 100k Person A is now at +1 years Person B is now at -1 years Again, this means they both invested equally. What is usually harder to see is the time investment. But Person A gains one year of work they did not have to do on the product (via their investment). Person B loses the year they invest/spend on the product. Purchasing a product does not imply joint ownership. Consumers do not partly own the profit of the Producer. However, if A and B decided to build a pie product together then yeah, they'd split the profits. Which is what is at stake here in this overall discussion: how should profits fairly get split when two or more parties contribute the resources to build it.

nl 7y ago
This literally makes no sense, and it wrong even by your own math. Person A is now at -100k: Agreed Person B is now at 100k: Agreed Person A is now at +1 years: If you are valuing 1 year at 100k, then no - they are at zero years. They put in $100K over 1 year, so the two cancel each other out. Person B is now at -1 years: Again, they have been paid at the rate of $100K for 1 year, so they are at zero years. Again - I reject this "losing a year" thing. The investor hasn't gained a year at all - you can't lose or gain time. But if you value 1 year at 100K then they have paid for 1 year, but that means they have by-passed other opportunities. If they invest $100K in 2019 and the company goes bust in 2020 how have they gained a year? But even ignoring that (!!) your math doesn't work.
- superqd 7y ago
  Let's say you have 1 year left to live. You have two things you want to do, X and Y, but X and Y take 1 year each to complete. It is the end result you want, but each result takes 1 year achieve, and you only have 1 year left to live. What can you do? Well, if you have enough money, you can pay for someone else to work on X while you work on Y. In this way, you have been able to get 2 years worth of work done, in only 1 year. In effect, you doubled the number of years you had to spend on getting things done. Spending money in exchange for someone else's work is a time multiplier on the one who spends the dollars. They get more done in less calendar time, i.e., because they effectively have more effort-time by converting their money to someone else's calendar time. The entirety of my reasoning in predicated on one simple thing: an investor trades in their money for something of equal value, and the worker trades in their time for something of equal value. This means, by definition, they are equal partners in the exchange, and hence must split the profits equally. It also means they each gained and lost equally, because they traded evenly. If you do not agree with the foundational assumption I am making, point out the error in that, as all else necessarily follows.
  - nl 7y ago
    The investor isn't trading their money for time, they are trading it for a share of a company.
  - nl 7y ago
    Also, if the company failed because they failed to deliver that thing you wanted to build does the investor get the time back? No. But the employee keeps the money. The entirety of my reasoning in predicated on one simple thing: an investor trades in their money for something of equal value, and the worker trades in their time for something of equal value. Indeed. The investor buys part of the company, and the worker gets paid for their time. If you buy shares in Microsoft you get a proportion of the company, not some weird "time" thing.