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Direct investment market

Most of the stock market is just shifting shares between buyers and sellers and doesn't invest money in the actual companies
  [vote for,

Have a flexible market cap and a dynamic number of shares issuable.

So you can invest directly in a company and give the company money.

When a company does an IPO is issues a set amount of shares for sale and raises the amount of money.

I propose companies are doing IPOs continuously and selling shares of themselves all the time.

Typically when you buy a share you're just buying it off the previous holder of the share. You're not actually investing in the company significantly.

There is such a thing as a flexi cap fund. But that's just a fund that invests in companies that doesn't have a fixed market cap.

chronological, May 27 2020


       Schemes similar to this exist (I'm thinking of a fund run by an alumni group that invests in startups founded by other alumni) but generally the investors must be "accredited investors" i.e. rich or finance professionals.   

       A rant I read online somewhere proposed having all employees do an annual vote if they want to "cash out" the company they work for i.e. if a majority of employees vote to dissolve the company and evenly divide the assets of the company among the workers, then the company is dissolved, the workers take the money and run and look for new jobs at other companies.
sninctown, May 28 2020

       The nature of stock is that its value is a percentage of the company's value. So any new stock issues must dilute the value of the existing stock. Bonds are a way to directly bet on the future of the company.
Voice, May 28 2020

       If I buy a holding in company X on the secondary market then, it's true, I'm not providing additional capital to company X's operations. However, it is the existence of the secondary market which makes it worthwhile for those investors who originally did fund company X's operations.   

       If the venture capitalists (or bankers, or whoever) were not able to sell off shares in X, at a profit, to suckers like me and you, then why would they take the trouble and risk of getting X off the ground in the first place? And how would they then acquire the liquid capital to fund a new company, Y?   

       And why would I buy shares in a company if I knew that the value of my holding would be continuously diluted by new issuance? It would be like buying bonds from a government bent on hyperinflation.
pertinax, May 28 2020

       this does not make any sense nor is it in anyway new. You can buy shares from a public company at time by sending a mail to the CFO -- notoriously people used to do that. And you can buy a substantial piece of any public company if you have enough money directly from the company, if they are so inclined. And you are getting "new shares" from the company if you reinvest dividends, and employee stock options become stock all the time... and... infinitely
theircompetitor, May 28 2020


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