The Good Things Partnership
From TurboCASH Wiki
The Good Things Partnership
The inspiration for the name of this Partnership comes from a movie where Alec Baldwin and Ben Stiller are standing together in a urinal talking about “Good Things”. With this in mind let us put this together and make sure that nobody gets wet in the process.
The Second Internet Bubble
The are a number factors that effect the outcome of this project, not least of them is the state of the IT markets. TurboCASH is an accounting package, but is being presented here as an Internet investment. Anyone that was eyes open in 2001, will have a healthy fear of the first Internet Bubble, and should approach any Internet investment with caution.
At TurboCASH we saw the Internet very differently. Whereas there was an investment bubble and crash, we have followed The Internet closely and it has gone on to completely change out lives. We have based the technology and the delivery around the Internet. TurboCASH as we know it today simply could not have existed without the Internet.
We have now entered “The Second Internet Bubble”. This is very different from the first and much more rational (at the moment). We now all realize the importance of Internet based products and the Global reach that they offer us. The demand for these companies is undoubtedly going to effect the outcome of this investment. This will change dramatically in the near future.
This could give us a considerable premium on on investment and it could just as quickly disappear. We will have to deal with the changes. It is important to acknowledge here that the state of the IT market is beyond the control of the TurboCASH Project, The Disclosed Partner or The Good Things Partnership. This will remain a exogenous variable and if you are unable to cope with this ambiguity, you should not enter this investment.
TurboCASH Registrations
Users, both New and Current can freely download copies of TurboCASH from the Sourceforge web site. They are free to enter up to 150 transactions, thereafter we ask them to register the program. Registration is free and we try to make it as easy as possible. Once the users are registered they are free at any time to deregister. If they stay registered, we regularly sent them email. An accounting package is an living project. We have responsibilities to governments around the world to keep our users informed of the changes in their territories. We would like them to stay connected to us. However this is their choice.
Currently we have no means of distinguishing if downloads are new users or repeated downloads. The ratio of downloads to new registrations is about 10 to 1. So there are a lot of people who download TurboCASH and do not register. Registration codes are transferable so once you have one, you can copy the program onto other machines, use the same registration code across multiple users. There are a number of ways that we can tighten this system, but the main consideration is not to impinge on the users rights to privacy and freedom. We are after all an Open Source project.
Some countries where we have really strong followings like Indonesia and Zimbabwe have limited access to the Internet and do not register online.
So for The Good Things Partnership we focus only on the users that have registered with us. We regard these as our loyal core.
At the time of writing this (November 2005) our monthly downloads are over 20 000 and our registrations are over 1200. A full history is shown below.
What does the Partnership actually own?
There is a common misconception about Open Source that when you licence a product under Open Source you are giving it away. This is simply not true.
We still retain the copyright. We retain the trademarks. While everyone has the opportunity to fork the product, this is usually easier said than done. There is a huge momentum behind the TurboCASH project. As we grow this gets stronger. To reconstruct the production and distribution channel is much harder than is immediately apparent. Very few Open Source projects successfully fork.
The GNU GPL ensures that any developments to the code must be returned to the project. So if parties are willing to develop, their output is immediately available to us.
It is also a misconception that the project is democratic and has no central decision making capability. This is also not true. While a developer does have the right to fork, if he stays inside the project, he is obliged to work under our rules. This is however a game of mutual respect and we are influenced by our top developers. Open Source projects are developer drive. The Good Things partnership enables us to contribute finance instead of development and to steer the project in the direction that the owners require. This means that effectively we are free to trade and deal with whatever parties interest us. The larger we become, the more those parties are going to be prepared to pay us to move their way.
Who would want to deal with us?
Basically anyone who wants to sell products or services to the SME market has the same problem. It is fragmented and difficult to communicate with. TurboCASH Opens that door. Link your service or product to TurboCASH and all its users immediately become available to you.
These deals have started to happen over the second half of 2005, eBay buys Skype (Skype is effectively an Open Source project), Google invests in Java Desktop (Open Office), Oracle buys InnoDB, Microsoft is currently courting AOL, primarily to acquire Firefox, the Open Source jewel of the AOL business.
Currently Intuit and Sage have between them 12 Million users. Microsoft is encroaching on the SME Accounting market from both sides. Vendors of enterprise software like Sun, SAP and Oracle, have large bases of users that will be very interested in linking through to a base of 1 Million users.
Any other Open source project that needs accounting needs to “upstream” to us. These products include Open Office, OSCommerce, Zen Cart, Sugar CRM, Vtiger. These projects are both acquisition targets fro us and well as potential buyers. This sector is going to be very active over the next year.
Online Media companies like eBay, Google, Amazon, Skype are all chasing the SME market. Once you have a homogeneous group like TurboCASH users, you have a gateway to a market.
Because accounting is such a pervasive application, Linux vendors will find great interest in a captive market of 1 Million users.
Banks, freight companies, Office supplies, travel agents, conference providers, auditors, financial service providers, ISPs – all these companies find access to the SME market fragmented. We offer them a simple door to a well defined customer. They are the predators circling the “fishball” and we are there to catch them.
We are in the tax collection business. Governments love us. They want healthy tax paying businesses. A working accounting system is the key to that process.
This does not mean that our strategy is exclusively “grow the base and sell”, although that is a front running idea. We are still in the building phase. As the number of users grows, we revise this strategy to deal with what ever comes on offer.
The Mission
The Mission of TurboCASH project and the Mission of The Good Things Partnership are not necessarily the same. Developers working inside the TurboCASH project have their own agendas. They are working on niche implementations, making TurboCASH work sin a specific market or with specific hardware. What the partners want is to drive the project to gain a large amount of users.
As partners, we are more interested in developing the community than on the day to day revenues of the project. So we are not involved in the specifics of how to make money on a day to day basis. We leave that to the developers and agents and we leave them to have these revenues. What we want is more and more of them feeding off the “fishball”.
We are specifically not offering revenue streams as part of this proposal. This does not mean that we should not take them if they arise, it is just that getting the maximum size of the user base is the first priority. As this rises it will become difficult not to make money out of it.
From about 100 000 users we become major players and we can expect to be approached by many suitors. Once we get to 1 Million users we have an entity worth at least $ 100 Million under current market conditions. We will have the option of selling out to these suitors or simply staying where we are and taking advantage of the revenue opportunities. As our user base grows we become stronger in the market and can negotiate connection relationships on our terms.
The Nature of an Exit
I don't want to give you the impression that what we are going to do here is build up a a huge user base sell them to a commercial competitor and close the project. This is not a likely outcome.
However, we all enter into this Partnership for different reasons. Some partners are simply speculators. They purchase shares, watch the value rise and then leave when they choose to do so. This is their free right. So we can find along the way a shifting of ownership from one group to the next. Each new partner has a different agenda and is able to influence events to their needs.
As the TurboCASH User base grows they become more and more valuable for their “homogeneity”. So you are able to launch Web serves at ever increasing degrees of profitability. So it is quite possible that our future partners become business customers rather than owners in the sense of the other partners. An example of this would be the recent Google funding of Java Desktop, where it is on Google's interest to invest funds in the Java Technology to ensure that the Google search bar is integral to Java.
So we would happily entertain overtures form commercial accounting companies or large companies to link the TurboCASH community to their systems., At the point that these deals become profitable, the Good Things Partners can either decide to stay on for the revenue generated or to sell to interested parties.
It is however highly likely that a commercial competitor would want 100% control of the TurboCASH project and they would then wish to direct it in their desired direction. In that case the partners would be expected to sell their shares at the price negotiated by the Disclosed partner and pass control to the new entrant.
En Commandite Partnership
An en commandite partnership is associated in South Africa and Australia, with tax avoision schemes in the movie industry, so why introduce such an unpopular structure? The Good Things Partnership has very little tax benefit. In most countries partnership losses are ring fenced and can only be claimed up to the amounts put into the project. In those countries that do not have ring fencing, partners will be able to enjoy as substantial tax benefit as we are likely lose substantial amounts on the way to acquiring the user base.
Here is a description as laid out in Wikipedia, a very successful OS project. http://en.wikipedia.org/wiki/Soci%C3%A9t%C3%A9_en_commandite_par_actions
As this is going to be a multinational partnership, a partnership structure enables us to have “nationless” structure. Using a partnership structure gives us the greatest benefit and flexibility to each partner. Each partner deals with the laws of their own country.
The “en commandite” part, means that partners remain anonymous. They have no liability other than their investment. They are not required to put in further monies or to have any exposure other than their investment. All contact and contracts with the outside world is carried on by the disclosed partner. This give maximum protection to the partners. Further the disclosed partner is merely committed to spend the revenues raised. There are no liabilities or fixed costs. The partnership has minimal running expenses and can never run up liabilities or face insolvency. The Disclosed Partner, Flash Internet CC The Disclosed partner is Flash Internet CC and its appointed agents. Flash Internet is a close corporation registered in South Africa and is and will remain 100% owned by Philip Copeman. The mandate of the disclosed partner is to carry out the mission of The Good Things partnership and to report live on all expenditure. All funds raised for the partnership will be kept in trust and accounted for by The Disclosed Partner and its agents or will be distributed to the Partners. Flash Internet may not enter into any other business.
Philip Copeman has a long history of success in the Software Industry. He has been the sole provider of finance for the first two years of the TurboCASH Open Source project. He has been integral in building a number of Software products. He has the major part of his personal assets invested in the TurboCASH project.
The Disclosed Partner may not in any way beyond the funds invested indebt The Good Things Partnership.
Who do we expect to be partners?
Users – These people are actually the most important part of the project. They also have the greatest understanding of the potential of TurboCASH. We should offer them the first option to own this project. We expect these to be small investments, but it will gain us a wide group of support.
Developers - We will be able to acquire the services of investors a lot simpler buy buying their services. We can raise the funds necessary to do so by issuing shares in The Good Things Partnership to developers
Development Financiers – These are parties that wish to invest in TurboCASH project, but find the GNU GPL commercially unviable. That is, they want a significant change to the system, are prepared to pay, but cannot justify the whole cost of the investment. By selling them shares in the partnership, we are able to make their cash investment viable.
Media Partner – Most of the funds raised from partners will be used to purchase media space. The potential exists for Media providers to take partnership shares and be paid effectively in shares. We anticipate that a large portion of partners will be media companies.
IT Investors - Under the current bull market circumstances, investors have the opportunity to purchase a share in the partnership and sell their shares later at a substantial profit.
Shares in the Partnership will be numbered by rank. Where shares have been acquired by trade for development or media placement, they will have the lowest rank. Shares acquired by direct cash investment will have the highest rank. When new shares are offered to a new partner, these will first be offered to ranking partners who may choose to sell their share in the partnership at the same price as the incoming partner. Ranking is on a first come first served basis. This will enable the maximum liquidity and allow partners to exit the Partnership freely.
Partners my sell their shares privately, but must first offer them to the The Good Things Partnership first. There are no outside creditors to the Partnership. The Good things partnership may at any time offer to purchase partners shares and will make these offers to partners by rank order.
The disclosed partner may sell the entire partnership for cash or shares consideration, and all partners will be paid equally in accordance with their proportional partnership holding. The Price guarantee
This investment is attractive while the shares in the partnership continue to rise. However it is possible that market conditions can turn against the project and we may be forced to sell the project at a discounted price. In certain circumstance, Philip Copeman is prepared to underwrite the sales of partners shares by supplementing them with sales of his own shares in the partnership. Not all partners will have this guarantee, it will be negotiated at the time of purchase.
As Philip Copeman is the largest partner and is also the owner of the disclosed partner, he is in a position to control the sale of the partnership. In the sale of shares he is underwriting a “low price of sale”. This is not an guarantee of funds invested, but an offer by Philip Copeman to supplement the sale of any partners shares with funds generated by the sale of his own shares.
So for example : If a partner has purchased shares for $ 120 per share and Copeman has Guaranteed a low price of $ 100, then in the event that we are forced to sell the partnership shares at say $ 50, Copeman will still offer to pay the partner concerned $ 100 per share. Copeman will do so by selling his own shares at the the price of $ 50 paying the partner concerned his guarantee. Not all shares will be sold with this guarantee.
A choice of projects
When a partner buys into the partnership they will be given the option to choose how their investment should be spent. This will enable the partners themselves to have a say in the direction of the project. So typically this would mean marketing in a certain country or investing in a particular sub project.
This will give a financier an option to develop a certain add on to TurboCASH. One of the problems we have with Open Source development is getting the first user to finance the cost of development of a sub project, when on release, all his industry competitors immediately get the product for free. Usually the numbers don't add up. It is difficult for us to get more than one party to invest. By buying into the partnership multiple parties can get the benefit of both the development that they want and the benefit of owning a growing investment in an Open Source project.
Disputes
Any disputes between the partners will be conducted in the country of residence of the partner with the largest share. Any disputes between the partners and the disclosed partner will be conducted in South Africa.
Is this a Pyramid Scheme?
So just what are we suggesting here? We want you to buy into a partnership that is offering not only a zero return rate, but also zero revenue. It seems that the only way that you can get your money out is to sell to the next person and further than this the major partner is offering some partners guaranteed selling prices. This whole thing smacks of a pyramid scheme or worse, a Ponzi scheme.
This is not a Ponzi Scheme. To find out what a Ponzi scheme is, click here [1]
There is nothing odd about this financing. It is a tranche based venture capital exercise with the prices of entry rising, that instead of being offered first to outsiders, is offered first to users of the product. This method of financing is very similar to the way that most successful Internet projects have been financed. We know that as the number of TurboCASH users rises, the value of each user and the total value of the users rises. If we sell out all our interests now we will be devoured by outside capital. By selling in it “rounds” or “tranches”, we enable those that come in early, who take the biggest risk, to make the maximum return on their money. The real risk in the TurboCASH project has already been taken. This was taken by Philip Copeman and all those that contributed to to getting out the early Open Source versions and helping to get the first 5000 then 10000 users.
Salesmen's Commission
If you go over the above, I am sure that you will agree that unless you are familiar with either TurboCASH or Open Source or the opportunities and dangers of previous Internet Bubble, getting you head around this investment can take a while. We are going to require hard nosed salesmen to make these investments happen at the right prices. We are therefore offering the people that do this a commission of 20% on successful applications. We want all investors in the partnership to be aware of that.
