We will be listing the assets in 3 Phases:
1st Phase: 30 000 at 30 NXT Due: 10th May
2nd Phase: 40 000 at 40 NXT Due: 21st June
3rd Phase: 50 000 at 45 NXT Due: On Opening Est: Mid July
I wish people would stop doing this, it doesn't make sense.
If you want to do an IPO just list your shares at 40 NXT which is approx. the average. Why would anyone pay 45 (12% above the average of the new issue)? Honestly BGCAFFE is great I invest in it myself but if you're going to do a fundraiser, why would I pay 45 for shares when I know I am throwing 12% of my money into the garbage?
Again I like BGCAFFE but why pay 12% more when I can just pay 3 or 4% more and buy MMNXT? Or invest in something else -- even some other IRL business, like Temple Hotels, which pays almost 10% per year? From a financial standpoint I just don't see the point in structuring an IPO this way.
In fact I see little reason to buy shares at 40, since it would only make sense to buy at 40 if you could guarantee a full sell-out of shares at 45, and you can't. So you could even be damaging your own IPO here (because the pricing of the second tranche is unattractive).
Normally what happens in an IPO is you take your existing share price and then issue a # of shares against it based on what you want to raise. Otherwise what you are doing is dictating your share price which is impossible unless you own a great majority of it. Why didn't you just float 200k shares at 24 or 25? Why state your shares are worth so much more? Frankly if your shares weren't worth 45 before, averaging them out with 25 (a great simplification, I know, but...) puts them at an average price of about 35. All things being equal don't you think it would be better to just issue shares at the price they are worth, and see if the market can support them? Forcing the market in this way will only lead to a glut and a crash. I can't see any real liquidity happening here until the business has been up and running for several months otherwise. And that is a pity because I had hoped to see this heavily traded someday. This just seems like another nail in the liquidity coffin for BGCAFFE.. Am I missing something?
Hi Printshop,
Firstly thank you for the post, this is also new to us and we appreciate advice and feedback.
Regarding staggering the assets listing in price, you are correct, it was what we did with the first shop as we wanted early adopters to benefit. For the first store had a higher degree of uncertainty, however this time it had no real benefit and we were also subject to manipulation in that someone bought out all the shares and then just listed them at a higher price. So we will NOT do this again, in future we will just list the shares we require to be sold at market price until we raise the required funds.
However regarding the value of the shares, we are paying far higher than 10% return per an anum, additionally we based the prices listed above on sufficient capital that would be required to open the store. If the NXT community is not willing to pay those prices for the assets, its not worth us listing the assets. Keep in mind NXT has dropped in value 6 fold, so we listed our very first asset at 10NXT, it should now be 60NXT at list price. We are currently paying out 1NXT per an Asset, when we started it was around 0.24.
Lastly I would just like to point out that people must see the difference in BGCAFFE from for example mining or arbitrage assets, those assets payout large returns however are high risk. In fact to date hardly any of them have lasted!
Brick and mortar businesses are more secure and stable, we firmly believe that as time continues and we show the community that we are sustainable the value in our assets will stand out clearly.
