Open Capital

I'd like to introduce a concept that is being touched on here. This comes from Chris Cook a former City of London regulator and creator of the Iranian Oil Bourse.

The concept is the  sharing of risk and reward through asset based finance and there are  already working models.

http://www.opencapital.net/

Re: Open Capital

OK, Well this isn't really a business model in its own right, rather a financial wrapper for  shared investment. It came about due to a change in UK law, intended to protect financial partnerships, such as Barings from vicarious liability.

The result was the UK variant of the LLP a structure which for example has been used by a Scottish charity to fund a wind farm in Pakistan from existing assets rather than conventional debt  based funding .

Chris Cook owner of the Open Capital website will do doubt be happy to join us here though he and I have already opened a discussion about the applications in the Open Capital group of the Omdiyar Network/ 

Re: Open Capital

hi jeff-

just browsed the opencapital site. read the 'theory' page. maybe you can help me out.

let's say a school decides to join such a partnership. who runs the school? what if the school falls on bad times, neighborhood decay, for example. can the partners pull out seeing it as a bad investment? what if public funding is decreased in this school and parents move the children out to some other school? can the investors disinvest?

thanx.

the best-
basho

Re: Open Capital

Hi Basho,

This is something I'm learning myself, so I can't offer the  experts  opinion.  I'll ask Chris Cook to join us. But first this is a financial wrapper which doesn't influence the way in which any organisation is structured or  maintained. So a  school , housing complex or  business  might all be examples

So, as I understand it, the parents and community might  be investors along with the local authority which owns the land  with the school an organisation, as the tenant renting the capital assets used,  from the investors 

Yes I believe an investor may sell their share in the physical infrastructure. You might also have the situation where parents decide to waive their rental returns until their children leave, then continue to hold the investment and take the rental as income to support the investment in another school, and so on.

This is based on a model under UK law,  Chris Cook the one to give definitive advice will no doubt tell you that it can also be done under a US LLC structure. I think you should talk to him if this is something you really want to do.

Jeff         

Re: Open Capital

Basho, Now I notice you're Swiss. I don't know what structures exist there, but I do know that your democracy allows 100 people to instigate new legislature. That's how I've understood it, at least.

Next month I'm expecting a visitor from Lausanne who's in the world of investment. She might be able to shed some light on the possibilities. I'll bounce it off her.

Jeff 

Re: Open Capital

hi jeff-

          'Now I notice you're Swiss.'

i haven't noticed that. :)  (moved here some 14 yrs ago)

          'your democracy allows 100 people to instigate new legislature.'

the referendum concept. but it only works if people vote. there seems to be a new ballot in the mail every couple of months. politics is a little different here than in that …other great democracy presently sliding into the toilet.

you might also be interested in the 'rotating govt.' concept wherein the 7 members of the Bundesrat rotate the presidency and the other cabinet posts on a regular basis. so one year one is president, the next maybe the ministry of defense, or finance, or judiciary etc.

CH has four official languages - french, german, italian and romanisch (a very old and beautiful language). English is fast becoming a second language. This of course extends to the culture of each of the linquistic-regions. So one can go to the italian portion of CH and experience the italian influence, for example. Without worrying that the trains are on strike. ;)

the best-
basho