General process

October 2, 2019

1. Due Diligence

Once an individual applies to be considered as an issuer, platforms’ team reviews the applicant to determine his/her adherence to the standards and validity of the credentials.

2. Issuance Details Definition

Platform and approved issuers finalize the details of this and any possible subsequent offerings: total possible offered size, initial offering size, pre-placement duration, minimal amount per hour, and the term sheet.

3. Pre Placement Review

Potential investors review the issuer & proposed term sheet: use of funds, timing of when issuer will be using the funds. Once investor reviews and agrees with the offering, she or he can commit funds to the pre-placement to be included in the order book for the placement. Price of human equity will be determined through holistic auction for the order book participants.

4. Holistic Auctions

Price per issuer’s hour will be determined through the process of the holistic auction – total amount of committed funds divided by the total amount of hours per this offering at the end of the pre-placement. For example:

Issuer decides to commit 200 hours at the initial offering at $200 per hour as a minimal price.

  1. If investors commit exactly $40,000($200 x 200 hours) then each hour will worth $200 and each investor will receive his/her committed funds/$200. E.g. if investor commits $1000 she or he will own 5 hours of issuer time.
  2. If investors commit more than $40,000 due to the high demand then each hour will worth total amount of committed funds/number of offered hours. E.g. if investors totally commit $100,000 then each hour will worth $500 ($100,000 divided by 200 hours).
  3. If investors commit less than 75% ($30,000) due to the low demand, pre placement is cancelled and investors receive their funds back.

5. Placement

Once pre-placement is complete and price per issuer hour is determined through holistic auction, all of the order books participants will receive the human equity asset proportional to their invested amount. The following day they can start trading their human equity or redeem it for the issuer time.

6. Human Equity Redemption

Once the holder of human equity indicates on the platform the desire to exchange the human equity for the issuer time, an issuer has to respond within 72 hours to propose several mutual acceptable time slots. Platform will facilitate all of the communication and will collect the feedback from the holder once exchange has happened. Positive and negative feedback of using issuer’s time will be used to keep Social Score of the issuer on the platform. The initial score is 85 and will be adjusted up or down per point per redeemed hour.

7. Fund distribution to the issuer

Once funds are collected, issuer is entitled to receive the collected funds, less 6% of placement fee (for initial and subsequent placements) and less 4% platform listing fee (paid once per issuer). Collected funds are held in special escrow account and could be allocated to the issuer if both of the following are true:

  1. The amount and timing of the funds is in line with terms mentioned in the term sheet.
  2. The Social Score of the issuer is above 90.

If score goes below 90, issuer will have 90 days to get the score above 90 to get the next tranche of funds. If issuer’s score is below 90 and no redeemable human equity left, or if issuer fails to get the score above 90 within 180 days, the remainder of the escrow amount will be distributed back to the last registered owners of the human equity.

This General process was last updated on October 4th, 2019.