conflict of interest? They test it first, then uses those insights to decide whether or not to invest, that removes the conflict of interest because they’re testing it first

biggest challenge as an investor: industry is saturated now, and firms are more resistant to trying out new technology, so more demand for investment from startups, but less demand from firms themselves, due to being fatigued from so many startups pitching the firms

Prefers the club side vs the virtual fund because more direct involvement in it. I wasn’t able to articulate why it doesn’t need to be regulated particularly well.

The cash efficiency of the tax returns makes it better to invest directly into the startups themselves, plus then he can pick the ones he likes both, so it’s just a better deal all round that way.

Neil and Ryan (Accountants)

Both done well with their businesses and now looking for additional areas to invest in. Both buying their final homes then will have money available to invest

Neil mentioned he had a few rental properties and acquired an additional accounting business last year

For ryan - RE the hub, his preference is for all the people that have invested in the hub are accountants etc therefore better qualified to vote, that would give him more confidence in the voting process, and he’d want it to be a weighted vote when deciding whether to invest or not

Max Inglis

Odin uses a UK Bare Trust structure, as a globally tax transparent vehicle

What are we trying to achieve?

In a nutshell, in anticipation of our upcoming investment raise, we’re trying to figure out the best way to structure it tax-wise, especially considering that we will have a mix of Australian and UK investors.

Our initial thoughts:

We have heard that setting up something like a UK Bare Trust SPV would give tax transparency for both countries, however not locked into this idea at this stage.

Key goal: Tax efficiency for both UK and Aussie investors.

Puzzles to Solve:

Is there an Australian version of the tax transparent UK Bare Trust?

What tax schemes are Australian investors entitled to? (Just providing the name is fine - so that we know where/what to look at)

Any tax quirks/’be aware of’ for Australia investors owning part of a UK entity? And vice versa?

Would love to hear your thoughts or any similar scenarios you've encountered. No need for deep dives - just your first impressions or any pointers would be amazing!

With the fees, he said just do both, they should value both

He also made an interesting point about paying some of the returns back to the investors - a profit share model. It might not be relevant/necessary, but could be a way to further ensure they are bought in.

Another thought, since we’re flexing the onboarding method, maybe there is

Ogier - law firm that he knows which do international tax structure setups.

send over the Odin doc

Overall, he reminded me that he’s not a tax specialist, so it’s not necessarily his remit to be able to help with that. But, once we got to it, it seemed like he agreed with the structure I was proposing - setting up an SPV, but the big question is, how do we get the cash to go from the SPV to the main company.

He said maybe we do it as a loan - the cash gets loaned from the SPV to the main business, and then the loan is repaid via the equity we get in each startup. But I wonder if we can do it simpler than that - what if the money goes directly into the main company and the investors get equity in the SPV.

He started via talking about it as the idea of having a UK based holding co, which then has a UK and Australian entities, but when I explained that the reason I’m hesitant on that is that we are only looking at this as a 2 year project, so maybe not necessary.

Liam Lawyer

Highlighted some regulatory risk around raising money into the SPV - he’s worried that it could be construed as a financial product, because we are raising cash from investors and then deploying it, which is fairly close to a regulated activity.

His advice was that, unless there is a huge tax benefit from setting up an SPV, he doesn’t think it’s worthwhile, it would be better just to do a typical startup equity raise.

He was clearly trying to be helpful, but I didn’t feel he really understood the structure of the setup that we are trying to achieve, had to go over it a few times.

He said that this is primarily a tax activity, rather than a legal one, which is the same as what Max said as well, so there’s a theme there.

I wonder if maybe we’d be better off just using Odin for this process? Since they can cover us from a regulatory standpoint and give the tax benefits, maybe that would be a better approach? Would be interesting to at least get their thoughts on how we would get the cash from the SPV into the EAH LTD entity? Because that still seems to be a sticking point.

I asked about the money going into the LTD and then an SPV is created, is that a legal setup?

Basically here are the emerging options:

Straight up LTD raise

Straight up LTD raise

⁠

Creating SPV

Creating SPV

⁠

Paul Gardner (investor in HK)

Adi

21-3-24

startups that we’ve helped, ask them who their VCs are, or any angel investors

Linkedin ads

Find an equity finder and offer them exclusivity to our founders

family offices

deal scouts

focus on accounting tech, run a webinar as top of funnel and attract investors

demo day idea

accountants - do they have any clients that might be investors?

Adi mentioned he had a contact in London that is connected to investors

Do we need to change the Miro board? Ask existing investors

Need to put more about why accounting tech

Want VC perspective as part of our investors - do you think vcs might be interested?

DAS based webinar - ask them if we can do it as an affiliate

‘an investors guide to DAS’ as a piece of content

Gavin

27-3-24

forward petter amlie book

Jonathan Gaunt

Send him some dates

Amar & Karla

Initial notes from call with Karla and Amar

In our call today, they raised a good question - what happens if we do make a load of money from our service offering?

The reason this could be an issue for them/what they might be concerned about is that we could just use the cash invested to pay our salaries whilst we figure out a way to make the cashflow business work, which means zero ROI for them.

They need some protection against that, which makes sense.

I think idea 1 below is best because it’s worth remembering that, if we aren’t getting enough equity in businesses, we are failing at our goal. If we start this and, somehow, we find that we are making loads of cash, it becomes a completely different business model and therefore we should exit the existing model, give them their money back and carry on without them.

Idea 1

The first $100K achieved each year is earmarked for pushing towards our mission - to get as much equity as possible. Only doing this so that it minimises logistics.

Any cash above that amount is redistributed to investors.

This ensures that we don’t have any motivation to push cash.

This still doesn’t really solve/reassure investors that we aren’t just using their cash to figure out how to make the business work.

Could we combine this with some personal warranties? Legal framework to ensure that our best efforts are towards generating equity only as per our mission?

What else do we have to reassure them?

Re-articulate our personal incentivisation structure to detail that we stand to make a lot more from equity than we do from cash.

Below market rate salaries.

Idea 2

First 100K earmarked, then any remaining cash is decided by investors, ranging from:

Return to investors

Allocated to be used as follow on cash investments into startups

Put towards fund number 2 (in lieu of them investing directly, this would get very messy).

Idea 2

Some kind of pivot model where we guarantee to repay them their investment via company returns? Terrible idea from our side.

Idea summary

First 100K is at our discretion. Above that amount is put to vote.

Why? Because we expect some level of revenue under this number (100K) and want to minimise the back and forth for investors. Plus, an additive approach allows us to spend the cash as required before hitting the threshold.

Above 100K, we will have a voting procedure in which we will present a suggestion as to what we want to do with the additional money.

The proposal can either be accepted or rejected, if it’s rejected, the money simply returns to investors.

Additional considerations/reasons why we didn’t spend a lot of time thinking about this before now:

If we gain more than $300K at the end of year one, it means we’ve done something wrong, so it’s plausible that we would consider closing down, returning money to investors (including distributing the gains)

The reason we are raising money is that startups don’t typically have cash, so it’s very unlikely this will be an issue

We contractually obliged to perform with our mission (which is to take equity whenever possible)

We are contractually financially incentivised to take equity, due to below market salaries and being rewarded via the same mechanism as investors (through exits/dividends).

If the above doesn’t suffice, we are happy to offer warranties around this issue (as we don’t see any reason not to).

4-4-24

Tax returns - wanting historic financial data

Exits - when looking at our historic data, it seems that it was not necessarily clear that we didn’t benefit from the exits that we had listed in that table

Can unit holders be forced to not exit the SPV?

How will external investors affect our strategy?

Ask permission from existing investors if they’re happy to talk to prospective investors

concern regarding Jack leaving

payment plan? instalment?

Yohan

4-4-24

Miro structure and support docs - look for inconsistencies

Benchmark slide - what was the latest from Adi on this? Should we keep it or leave it?

our journey - doing a loom covering the slides that previously covered this

Intro videos about us

Do some debrief notes about the investment call

15-4-24

[07:52, 15/04/2024] Ben Swanson: Seis is immediate [07:53, 15/04/2024] Ben Swanson: Linked in soft push to investors [08:02, 15/04/2024] Ben Swanson: Targeting more specific/targeted group of investors, so why not ignore UK market at first?

Strategy with Yohan and Alastair

paul certies

Look at existing companies exhibiting at das, and look at their investors if you can

Corporate investment vehicles

Yoris vander

Guy Pearson investor

proof points for what would have happeneed if we had been taking equity histgorically

which market are you going after. who is the ultimate winner, xero

45% equity

Tzakhi - Meet Capital (from Adi)

started as an agency, connecting with angels via linkedin

Partnerships and also helping to connect us with investors

Expandlee or expanding, gives access to our linkedin, then they run a search, and go through the results, finds good fits, active linkedin users. In the USA, they have a database so they don’t need to chjeck the links every time. No database in Aus, 3 messages with each contact.

Don’t recommend just relying on this method of cold outreach

My idea - Partnership RE Aus? we pay less but then we have list for future deals with our startups?

What are the success rates? 30% of angels should connect request, 2-5% overall response 5-15 investors might say interested

Globally

USA

How do we avoid people we’re already talking with? They can provide list of contacts, for us to approve first, and they don’t contact 1st connections

Pricing? $100USD, set up fee $1,000, 10% discount . 2 months recommended. 300-400, 400-500 on the second month,

List of investors? not australia

DQ Ventures

11-6-24

18 cvompanies since 2021

older founders, allowing them to start the company whilst their in their exisitng job.

helping them

4-5 have raised cash

what happens to the businesses when they dont go ahead

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