Are rich because of the markets - Warren Buffet - Birkshire Hathaway, Bill Gates - Microsoft, Larry Ellison - Oracle, Rob McEwan - GoldCorp. The list goes on I could name thousands. They got rich not from owning companies but from the increases in value of them through the markets. They played the game. The problem is that these are big companies and the shares and options were issued in a way that are not available to the little guy. For people in lower income ranges to become more wealthy the game needs to be changed in thier favor.
Googles auction of its stock on its ipo is a great example of one part of how this can be done.
Tuesday, November 24, 2009
Thursday, November 12, 2009
Wal Mart
As companies grow, they eventually growth slows for example Wal Mart. The Wal Mart story has been told all that awaits is the end. there is very little money to be made in Wal Mart Stock. Why? Its to dam big.
The solution is to spin Wal Mart off into hundreds if not thousands of small companies. WalMart would own all the shares and they would trade on the market both individually and collectively. Employees and customers would be portioned shares in the spin offs as to the viral capital model. It would include units of stores, marketing, purchasing, HR etc. Lets take the HR division. It would charge a fee to all of the stores, the stores would all get stakes in the Wal Mart Marketing Company based on its use. Since viral marketing is based on free markets any of the stores could drop the Marketing division if its not up to snuff, but its really in their interest if it succeeds. This would weed out the ineffective units of Wal Mart or bring them up to snuff. It would increase efficiencies by reducing waste full bureaucracy. In the race to lowest prices the eventual result is bankruptcy or near nil profits it effs up a lot of people and those that work there become low wage slaves at the bottom of the pyramid and overpaid dictators at the top.
The solution is to spin Wal Mart off into hundreds if not thousands of small companies. WalMart would own all the shares and they would trade on the market both individually and collectively. Employees and customers would be portioned shares in the spin offs as to the viral capital model. It would include units of stores, marketing, purchasing, HR etc. Lets take the HR division. It would charge a fee to all of the stores, the stores would all get stakes in the Wal Mart Marketing Company based on its use. Since viral marketing is based on free markets any of the stores could drop the Marketing division if its not up to snuff, but its really in their interest if it succeeds. This would weed out the ineffective units of Wal Mart or bring them up to snuff. It would increase efficiencies by reducing waste full bureaucracy. In the race to lowest prices the eventual result is bankruptcy or near nil profits it effs up a lot of people and those that work there become low wage slaves at the bottom of the pyramid and overpaid dictators at the top.
Viral Capitalism
What is Viral Capitalism?
Viral Capitalism is a new business model made to maximise efficiencies, growth and profits by rewarding customers and employees with common shares to become shareholders of a corporation. The premice is that outsized returns are possible by enlisting customers and employees in an equal weight basis with existing shareholders.
Technically profits go to the shareholders - but an amount of common shares equal to 1/2 of the profits gets split equally 50-50 between employees and customers. The profits can be calculated on a period ranging from monthly to annual.
Example - PDQ Company trading at a daily weighted average of $10.00 per share makes $.80 profit for the year the profits are attributable to the company and may be paid in part to the shareholders as a dividend. 50% of the value of the profits or $.40 is divided between the employees and customers 50-50 or $.20 worth of shares each. This would be a 4% dilution to the shares of the company and give the customers and the employees each a little less than 2% of the company. The value of the shares should be determined as the daily average closing price for a period of time that the profits are calculated on.
Viral Capitalism is a new business model made to maximise efficiencies, growth and profits by rewarding customers and employees with common shares to become shareholders of a corporation. The premice is that outsized returns are possible by enlisting customers and employees in an equal weight basis with existing shareholders.
Technically profits go to the shareholders - but an amount of common shares equal to 1/2 of the profits gets split equally 50-50 between employees and customers. The profits can be calculated on a period ranging from monthly to annual.
Example - PDQ Company trading at a daily weighted average of $10.00 per share makes $.80 profit for the year the profits are attributable to the company and may be paid in part to the shareholders as a dividend. 50% of the value of the profits or $.40 is divided between the employees and customers 50-50 or $.20 worth of shares each. This would be a 4% dilution to the shares of the company and give the customers and the employees each a little less than 2% of the company. The value of the shares should be determined as the daily average closing price for a period of time that the profits are calculated on.
Customer Loyalty Program Cost Effectiveness
The Viral Capitalist system allows for a portion of the profits 25% to go to the customers. How does this make sense from a bottom line point of view?
1)Get rid of rewards programs - Many large companies already have loyalty programs think air miles or VIP points, Canadian tire money or some other membership type rewards. With the information to collect customer data already in place the cost of setting up a program is negligible. Company's already have membership lists with specific customer numbers. Usually these programs run from under 1% to 3% of the cost of a customers purchase.
2)Reduced Marketing Costs - The second thing that companies do is bombard us with media spectacles, constant phone calls, unnecessary emails, flayers and various ads that try to trick us into buying. The costs involved with these practices can be cut out. although some marketing is necessary much of it isn't as it insults peoples intelligence and pisses them off.
3)The customers themselves become your sales force - the more people they recommend the more money they make. The more their friend recommends - they both benefit. and so on like a virus.
4)Customers will be very loyal - or as loyal as a person would be to their own company because it is their own company. Over time as the value of their shareholdings increases, so does loyalty- interest and marketing.
5)Customers will also run other busnesses or have influence on them - they may change thier companies to the Viral model. Then one day its a company that your company does business with. The company will now benifit from the interest in lets say a supplier - the more you sell of that product the better your company, your employees and customers do. But of course that doesnt mean that you will sell crap as it benifits no one.
6)Increased shareholder base - This is also a great way to diversify your shareholder base as it also spreads the word of your shares.
7)Increased liquidity - more shareholders also means more trades in the market - this helps to moderate the price fluctuationsn of the stock.
1)Get rid of rewards programs - Many large companies already have loyalty programs think air miles or VIP points, Canadian tire money or some other membership type rewards. With the information to collect customer data already in place the cost of setting up a program is negligible. Company's already have membership lists with specific customer numbers. Usually these programs run from under 1% to 3% of the cost of a customers purchase.
2)Reduced Marketing Costs - The second thing that companies do is bombard us with media spectacles, constant phone calls, unnecessary emails, flayers and various ads that try to trick us into buying. The costs involved with these practices can be cut out. although some marketing is necessary much of it isn't as it insults peoples intelligence and pisses them off.
3)The customers themselves become your sales force - the more people they recommend the more money they make. The more their friend recommends - they both benefit. and so on like a virus.
4)Customers will be very loyal - or as loyal as a person would be to their own company because it is their own company. Over time as the value of their shareholdings increases, so does loyalty- interest and marketing.
5)Customers will also run other busnesses or have influence on them - they may change thier companies to the Viral model. Then one day its a company that your company does business with. The company will now benifit from the interest in lets say a supplier - the more you sell of that product the better your company, your employees and customers do. But of course that doesnt mean that you will sell crap as it benifits no one.
6)Increased shareholder base - This is also a great way to diversify your shareholder base as it also spreads the word of your shares.
7)Increased liquidity - more shareholders also means more trades in the market - this helps to moderate the price fluctuationsn of the stock.
Ultimate Employee Loyalty Program
The Ultimate Employee Loyalty Program is to make an employee a shareholder proportional to thier contribution to the orginization. As a whole a viral capitalist organization would have 25% of the value of profits distributed to the employees of the company in the form of common shares. This is like a continuation of a share purchase or stock option program. Companies already spend large amounts trying to give incentive to employees - so the affects to the bottom line No $2.00 coupons or phoney awards here - thats doo-doo. A piece if the action is where its at. The minimum should be 1% of the market capitalization of the fully diluted share float. This keeps employees in the game in tough periods and scince its dilutive and not a capital cost it fluctates with the companies fortunes. The remaining value of profits 25% go to customers as new issues of common stock, and 50% to the common shareholders (which is cancelled). The proportion of stock issued to employees is proportioned according to thier wages (50%), seniority (25%), Insentive Pool (25%) of coarse this is only a simple recommendation and in practice may vary widely.
Ultimate Customer Loyalty Program
The ultimate customer loyalty program is to make the customer a part of the business. The portion of the business that the customer acquires is calculated by the customers revenues divided by the total gross customer revenues. Customers can include individuals, corporations, and other organizations including non-profit and governments. The customers are rewarded by common stock in the corporation at the end of each period which can range from monthly to yearly.
The amount portioned to customers should be equal to that of employees and dependant but not conditional on profits. The minimum amount of stock that would logically be portioned to customers would be one percent of the fully diluted shares outstanding. The optimal amount of common shares portioned to the customers would be 25% of the profits for the period. Of the remaining 75% is portioned 25% to the employees, the remaining 50% is deemed to the existing shareholders and is not actually issued but de facto would be issued and immediately cancelled.
The amount portioned to customers should be equal to that of employees and dependant but not conditional on profits. The minimum amount of stock that would logically be portioned to customers would be one percent of the fully diluted shares outstanding. The optimal amount of common shares portioned to the customers would be 25% of the profits for the period. Of the remaining 75% is portioned 25% to the employees, the remaining 50% is deemed to the existing shareholders and is not actually issued but de facto would be issued and immediately cancelled.
Tuesday, November 10, 2009
Tools of The Revolution
- Boycotting certain organizations
- Buying up shares en masse to change the corporation
- Recruiting existing shareholders
- Recruiting existing employees
- Recruiting venture capitalists and hedge funds
- Lobbying governments or/and protests
- Using the internet to form groups and to collude
- Recruiting Government Officials
- Electing the right government officials and corporate directors
- Working en Masse Via the internet (Facebook / YouTube etc.) to form groups / plan and execute strategies
- Have great parties and events to celebrate sucesses
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