Starlight Horizons IPO Plan
• Chapter 1 - Summary of STR-H
• Chapter 2 - Background on origins/idea/current business
• Chapter 3 - Corporate Governance
• Chapter 4 - The Business Plan
• Chapter 5 - Statement of Assets
• Chapter 6 - Full Disclosure of Risks
• Chapter 7 - Exit Strategy
• Chapter 8 – IPO Phases, Dividends, Market Cap
• Chapter 9 - FAQ
Chapter 1 - Summary of Starlight Horizons Incorporated (STR-H)
STR-H is a manufacturing and trading Corporation. The goal of STR-H is to maximize the availability of commodities in Gallente and Amarr Space. STR-H will be selling low to mid value T1 commodities through manufacturing and mid to high value T2 commodities through trade.
Chapter 2 - Background on origins/idea/current business
The background of this business plan is nothing new; most of my principles date back to other successful IPO’s launched between January and February of 2007. After investing over 2 Billion isk in other IPO’s and speaking with the CEO’s I feel that I am ready to build upon their ideas and include some of my own.
The idea is based off of my market research in Gallente and Amarr Space over the last three months. I have a mission runner who runs level 4 missions for each of those races, and I am very aware of the loot that drops as well as which ores are available in each location. I have built several spreadsheets to break down each module I have looted to find its basic value. By that I am referring to how much I could either sell the module for on the market or how much I could sell the minerals if reprocessed. In October I conducted an experiment with 4 modules that I found were being sold on the market for less than the minerals were worth. With a starting base of 150 Million isk I used buy orders with my entire capital. I also found that modules vary in price between regions, example was item A sold for 2,000 isk in Gallente Space on sell orders and there was buy orders in Amarr Space for 6,000 isk. I know, most traders try and separate trading from hauling, but I was tripling my investment with this single module. I was very intrigued by this finding and soon started buying different modules. After one month I had turned my 150 million isk into a respectful 475 million. However, I was doing a lot of hauling, often times spending 4 to 6 hours on the weekend picking everything up and taking it the 10 jumps to sell it. I got burnt out and decided this plan wasn’t a long term solution.
This brings me to my new plan, which uses the same principles, but not on a region wide level. I have identified 8 modules in my current base of operations that I have been buying with buy orders within a 1 jump limit which refine for more value than purchase cost. I have also identified 12 T1 modules that will make at least 20% profit in the current market if I purchased the minerals from sell orders! I will not be doing that of course, as 85% of all my minerals will come from refined modules. The reason this works is because I am not competing with 150 other people in Jita struggling to make 1-5% margins.
STR-H currently is a one member corporation. That is because this is an alt I started for this very reason. I will be using 5 characters to run this IPO, the main one I will disclose is my main. My main is Nummb, who has always been in a NPC corporation. I have 4 accounts and all of the character slots are full. I have flown PvP in a 0.0 corp with one and mined in 0.0 with another. One is my Amarr mission runner and one is my Gallente mission runner. The rest are merely market watchers. The pilots I used for the 0.0 corp I was in are Anini and Akira Miyatake. I was in Four Rings and the only reason I left was due to military operations in Southeast Asia. Upon my return from my military deployment I took a break and decided that I didn’t want to go back into 0.0 right away.
Chapter 3 - Corporate Governance
The corporate governance will remain intact; no additional people will be invited. I will be the only individual with Wallet Access, although, if it is requested, then I will gladly let in an Auditor from EBANK to oversee accounts.
Chapter 4 - The Business Plan
I have over 50 T1 BPO’s all researched to ME 30 and PE 10 which I will use to manufacture modules when I deem them marketable. I will not build anything that will not sell for at least 20% over mineral purchase price. If I find that during a given week that none of my production will meet this goal then I will simply sell 30% of my minerals during that week to maintain my target income.
Phase 1: Present the IPO and sell shares. I will use 60% of the initial capital to expand my current buy orders. I have two markets picked out to begin buying modules and Nummb has a transport ship that I will use to haul the modules between the two. I have carefully selected modules that were not affected by the compression change and I will continue to evaluate modules if additional changes are made by CCP. Timeframe: (10 day cycles)
Phase 2: I will haul after every 10 day cycle, or use contracts depending on the volume acquired during the cycle. I will keep an exact record of every purchase during the cycle and evaluate the value before hauling. If it is more profitable to just resell within the current region then I will. Once everything is in my base I will refine and calculate my mineral value.
Phase 3: I will check which of my BPO’s will meet my requirements as outlined above and begin production. I watch volume very closely, I will not flood the market with 2,000 modules if it currently only goes through 100 a day.
Phase 4: I will check my two market hubs and Jita for T2 modules once a week. I will take 35% of the initial capital and buy T2 modules in Jita which have favorable markets where I operate. I will set a hard cap of 10% of the 35% on any one item. I plan to purchase between 5 and 10 different T2 items to protect myself from over exposure. I will haul and use sell orders in my two operating markets and monitor them during the week. I will NEVER haul from Jita on a Sunday, but that won’t stop me from buying. I will evaluate sells performance and buy additional modules to keep my sell orders going. I fully expect to change which modules I sell on a weekly basis, so I will remain flexible and keep the 10% rule in effect at all times.
Phase 5: Approximately 5 days before the end of each month I will conduct analysis on how much money I have in buy and sell orders, how much value I have in minerals on hand and how much isk is on hand. I will send the dividend isk to my personal wallet so that I know exactly how much isk is remaining to continue operations. I will pay the dividend between the 3rd and 5th of each month depending solely on server status.
Chapter 5 - Statement of Assets
All of my BPO’s will become property of the corporation and will be locked down with a vote after all the shares have been purchased. Nummb’s Transport Ship and Hulk will become corp assets as well as they will be used throughout the IPO. I like to mine semi-afk on my laptop while watching t.v. with the wife, nothing major but its mindless and easy income.
Chapter 6 - Full Disclosure of Risks
There are a few risks associated with this IPO, mainly compression/refining change by CCP, destruction of my transport ship, mineral market flux, rl illness and military operations.
Compression/Refining Change: Depending on the severity of the change I will change my procedures as necessary to facilitate the movement of goods to my refining station. Nummb is just the freighter skill book away from flying freighters and if that became the only viable alternative then I would place a vote to shareholders to cover the cost of purchasing the freighter and include it as corp assets. I will pay for the skill book out of pocket.
Destruction of ships: I never haul afk and all of my operations will take place in high sec. Nummb is in an NPC corp and therefore cannot be war decced. I consider myself a veteran transport ship pilot and I have successfully flown through gate camps before. Should a loss happen though I will make a decision after reviewing the incident if it was my fault or due to game mechanics and or lose of connection. I have enough isk in my EBANK account to cover buying a new ship and if I am at fault I will purchase out of pocket.
Mineral flux: If minerals flux widely in price this could complicate operations. I will hedge my bets accordingly and keep a reserve of minerals on hand at all times. Nummb has over 250,000 shares in BSAC and I have the ability to create mineral contracts from Block if needed.
Real Life Illness: I will post or have my wife post if a rl illness causes me to halt operations for more than 2 consecutive days.
Military Operations: I am in the US Military, it is no secret and everyone who has known me in game already knows as much. I am currently stationed in Virginia and I am not in a deployable position due to a compassionate reassignment. For those of you not in the military that means nothing, for those who are, it’s a family member who is getting better and in the mean time I am undeployable. We have several other military folks here, I can share my AKO address with one of them but I would prefer not to disclose it on the forums.
Scamming:
Every IPO has a risk of scamming. I will not go to any great lengths to prove to anyone I am not a scammer but I will disclose the following information. My main is Nummb, my notable alts include Starlight Horizons, Anini, and Akira Miyatake. I believe that Ricdic might now one or two of my other alts due to them having EBANK accounts and I am making no attempt to hide any of my characters from the public.
I will hold money in my EBANK Account to cover fees and serve as back-up security for this IPO. I will request a member of EBANK to serve as a consultant and auditor if the investors want it. If the investors want API disclosure to EBANK and for EBANK to audit my corporation I will use corporate funds to pay for this service. I will pay the initial 20 million isk to EBANK to set-up a contract for this purpose and for every month or quarter an audit is requested the payment will come from corporate funds.
Chapter 7 - Exit Strategy
I will buy back shares starting in March 2007. This is a long term IPO that I fully expect to run for over a year. However, I will buy back shares from investors who request it. I am expecting this to be a growth corporation with NAV increasing over the IPO offering. When I conduct buy backs I will offer 95% of IPO. I will set a limit of 5% of shares to be bought back each month so as to not hamstring the operations.
If everything fails I will turn over all my sellable assets to EBANK. This includes all my BPO’s and ships mentioned. If absolutely necessary I will sell one of my other characters for isk to pay off investors. I will not fail, I am a NCO, I will Adept, Improvise and Overcome!
Chapter 8 - IPO Phases, Dividends, Market Cap
Total Number of Shares
101,000
Shares Allocated for IPO
67,750
Price Per Share
100,000
Anticipated Market Capitalization
6,775,000,000.00
Dividend Schedule
Between the 3rd and 5th of each month starting in February 2008.
Total Dividend Payment
707,000,000 per month then moving up as the corp grows.
Projected Return per Dividend Payment(%)
7%
Projected Return per Share
7,000
Dividends:
I have already created 101,000 shares and sent 50,501 to Nummb so that I control 51% of the corp. However, what I will do is take the dividends Nummb receives and divide them in half. The first half will go in my EBANK account so that I am maxing out my return from EBANK. The second half will be returned to the corp wallet and added in as corp growth. I will continue to adjust the value the corp based only on the shares purchased in the IPO. So, when I make more than what is needed for a 7% dividend I will make a post stating the new NAV. If I make enough to cover two months worth of dividends then I will place of vote to the shareholders if they want the additional dividend now or should it be saved to repurchase shares.
Chapter 9 - FAQ
Q: How do I know this isn't a scam?
A: You don’t; however, I will give my gmail account and cell phone number to individuals who want to verify who I am. Also, I will only give my AKO address to other members of the military.
Q: How do you know you'll be successful?
A: I don’t. I will make one promise though, I will not lie to the investors. If I am not successful I will do everything in my power to pay back the IPO.
Q: Why are you doing this?
A: I am an analyst at work and I tend to think analytically at home as well. I am taking college courses in economics and while all the theories don’t hold true, some do and I enjoy Eve for what it is and what it offers.
Q: Do you intend to have an audit done at some point?
A: Yes, as outlined in the plan I will pay an initial 20 million isk to EBANK out of pocket as a sign of good faith. If additional audits are requesting, I expect the corp to pay EBANK the fair market value for conducting this procedure.
Q: What's your background?
A: I have done it all, Mining, Refining, PvP, Missions, Manufacturing and Trading. I don’t do very much PvP, and when I do it’s with an alt flying a T1 cruiser hunting down Pirates.
Q: Will you ever buy back shares?
A: Shares will be bought back beginning in March 2008. I will limit the number of shares bought back to 5% of all outstanding shares currently available. I will offer those shares bought back first to the remaining shareholders and if they decline then I will offer them to the public.
Q: Will you ever pay over 7% dividends?
A: At first no, because I am planning on growing the business. I will give the investors the option however of receiving larger payouts instead of an increased NAV.
Q: What if someone War Decs STR-H?
A: This will have no effect as STR-H is a one man corp and Starlight Horizons will not be leaving the station. Everything will be conducted through my main and other alts in different corps.
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