Topic: Publicly traded mining business? (Read 2397 times)

For those of you interested in making an investment, please get in touch with me through a PM.  We can discuss details as well as determine an appropriate initial stake.

I will probably re-post my business plan on a new thread to facilitate further interest. 

I had 8 workstations with 2 open PCIx slots each.  I did not count the sunk cost of the workstations in the capital assets.

Hope that makes a little more sense. 

7.5k of hardware is hashing out 10 gh?  That is impressive considering the hardware is well protected.

The long term capital assets consist entirely of BitCO's hardware.  Cash (on reserve) is held entirely in BTC and is listed in short term assets. 

We currently have 1,000 shares outstanding (and will issue no more).  I own the majority of those shares, my CTO owns the remainder.  We are willing to sell 100 of these shares to angel investors at a annual yield of 15%.  This would translate into a per share price of 8 BTC.  Each share would initially pay monthly dividends of .1 BTC, with room for increases as seen fit.

What's the long term capital asset?  The amount of cash you have on reserve?  Hardware/equipment cost?

I'm wondering how many total shares there will be (yours included) and how much each share will cost for the initial investment?  Just got a work bonus so I'm in a position to invest.

I was thinking about this.

At first I would do exactly as you suggest.  I would keep the record of the 5-10 original shareholders as well as their information if they choose to share more than their address.  When more shares are issued, I will probably have to explore listing on an exchange.  If I feel I can handle the record keeping for 50-75 shares, I might continue handling it "in house".  I am thinking something like daily clearing would be adequate....just process any daily trades once nightly and update my records accordingly. 

I would like to restrict trading for the first few months, ie, a lock-up period in order to prove the company is viable before creating a market for the shares. 

I'd like in, if I meet your investor criteria, as possible angel or more general shareholder

Edit: eBay messaged one of my ID/feedbacks there

I really don't think I want to go that route. 

I am considering offering shares on the forum.  Originally I would like to find 5 "angel" investors that are interested.  After several months of successful operations, they will be able to give an assessment to the forum. 

If they are thrilled with their investment and the ROI is has had, then I believe more people will want in.  My end goal is to create a market for the shares that can be freely traded amongst the BTC community. 

will this be offered on glbse.com?

Ben, here is the business plan.


Executive Summary
Through superior management, effective leveraging of technology and a focus on results, BitCorp Mining Company (BitCO) will become the pre-eminent commercial Bitcoin Miner.  

Objectives
1. Increase mining capacity when cost effective, up to 15 GH/s.
2. Generate sufficient excess BTC to pay a stable and generous dividend.
3. Develop a well informed, financially savvy investor base.

Mission
BitCorp is built on the assumption that there is a distinct lack of trustworthy and responsible Bitcoin mining businesses.  We aim to change that perception by being unquestionably trustworthy and responsible, while also displaying the utmost professional ability.  Our number one priority is our shareholders.  To that end, we strive to create value through honest dealing and solid dividend payments.
  
Keys to Success
1. Differentiate from fly-by-night operators.
2. Build solid reputation that makes investors want to get involved.  
3. Increase share price through consistent and unfailing monthly dividends.
________________________________________

Company Summary
BitCo is a mature organization with stable operations.  Through our network of 26 miners, we are able to maintain a stable mining capacity of 10 GH/s.  Our technical know-how allows us to achieve fantastic up-time with few unplanned outages.  Our cost structure is very low due to favorable cooling methods as well as very cheap electricity.
 
Company Ownership
BitCO is currently majority owned by its founder, with a minority stake being held by our CTO.  No other individuals currently have an ownership stake.  

Company History
BitCO has been successful in BTC mining from its very first day of operation.  Started in February of 2011, BitCO has grown organically to its current size.  


Past Performance                       June                        July                                   Aug
Production (in BTC)                                 63.7                        85.9                                121.35
Operating Expenses (in BTC)                   31.5                        45.2                                  55.6
Free BTC flow                                 32.2                        40.7                                  65.75

Balance Sheet: August
Short-term Assets
Cash:  BTC 127.55
Accounts receivable:  BTC 80
Total Short-term Assets:  BTC 207.55

Long-term Assets
Capital Assets:  $7,502
Total Long-term Assets:  $7,502
Total Assets:  $7,502

Company Locations and Facilities
We have three locations:
1)   A residential office, with 3,000 MH/s of capacity.  Upgradable and expandable.
2)   2,000 SF class A office space with 3,000 MH/s of capacity.  Nearly maxed out on capacity.
3)   3.500 SF class A office space with 4,500 MH/s of capacity.  Large additional capacity.  

Products and Services
BitCO engages in 2 lines of business.  The primary business activity is the mining of Bitcoin.  The secondary business is the occasional selling of a mining contract to 3rd parties.  When management finds it advantageous, they engage in mining contracts that are short-term in nature and encompass a portion of BitCO’s capacity.

Competitive Comparison
BitCO has built a cutting edge, highly reliable network of miners.  Our operations are not what you would find in a garage of a teenager stealing their parents electricity.  All of our machines are state of the art, properly cooled, and adequately protected from the elements (read: no naked motherboards lying on boxes).


Main Competitors
There are currently several mining companies already is existence, but we do not view them as competitors.  Namely, since we are not competing for customers of a product, but merely mining a commodity, we do not compete.  That being said, we aim to be the pre-eminent investment opportunity in the Bitcoin mining community for the reasons stated above.
 
Strategy and Implementation Summary
Our strategy is to continue to operate professionally, and provide great returns to our shareholders.  We would like to broaden ownership of BitCO in order to both unlock value, as well as broaden the investment opportunities available for BTC.  We plan to implement our strategy with a private placement of a small number of shares to interested parties that meet our criteria.  

Peter,

I am trying to apply a rough Dividend Discount Model approach to pricing the shares.  If the gross earnings are 150 BTC per month (it is), they should probably be priced higher than 500 BTC in total. I think the best way to approach the IPO would be to do a Dutch Auction on 50 shares, and retain 50 shares for myself.  I would set the dividend at 1 BTC per share, per month with the retained earnings earmarked for maintenence and modest expansion.

make sense?

Ben,

I really appreciate the feedback.  I will be looking into writing a business plan.....if and when it is completed, I will be reaching out to you.

As for examples of my reputation, I can offer 2 for now:  My Ebay profile can be found under Yochdog, and my Bitcoin rep can be verified on this thread:  https://bitcointalksearch.org/topic/9000-mhs-rental-41888


Thanks!

I consider you one of the best bellweathers on here.

No pressure ;0)

If you produce a professional quality business plan for this, such as I would expect from a "real world" investment opportunity, which demonstrates to me you are serious and competent, I pledge to match whatever Peter L initially invests in you up to the BTC equivalent of £250.

If you deliver ~10% annual return over the first 6 months of operation, I'll double my investment. If you deliver ~10% annual return over the next 6 months, I'll double my investment again.

I want Bitcoin to succeed and I will put my hard earned money where my mouth is.

If you can offer me three verifiable examples of your solid reputation via sites such as Ebay etc ... I will double the investment pledges made above.

Feel free to PM me.

That's probably an easier way to do it, I'd be interested in it.

this is not a yah or nah on bitco mining but a comment about the 1Gh
just ordered from newegg........  1999.00 usd  for 3 Ghs mining power (assuming I have the ONE motherboard and 2 psus which could be bought for the other 500 bucks)
4     

    AMD HD5970 Radeon HD 5970 2GB 256-bit GDDR5 PCI Express 2.1 x16 HDCP Ready CrossFireX Support Video Card - OEM
    Item #: N82E16814105001
    VGA Replacement Only Return Policy

   $1,999.96
($499.99 ea)
Subtotal    $1,999.96
Tax    $0.00
 UPS 3 DAYS    $0.00
Rush Processing (Preferred Account)    -$3.99
Rush Processing    $3.99
Order Total    $1,999.96

Interesting....  I think I need a private placement.  Just find 10-20 investors who want in without dealing with a 3rd party. 

Could you elaborate on why you still think it is a bad idea?  Simply trust and verification issues?  Or is the business plan flawed in your mind? 

thanks!