cmapes

Restaurants do use the ugly food, there's many grades to choose from when you're a wholesale buyer purchasing from specialty suppliers.

Sure, but restaurants have special needs relating to getting groceries. When they want "avocados" they don't just want any case of avocados. They may want a case of "locally sourced Haas 40's with 4-5 day ripening time with a USDA Grade of #2 Combination, or #2, but not #1". Not just avocados. Instead of wanting "bread" they might need an artisan bread with a gluten free recipe that's standardized to 16oz weight for their lunch sandwiches. So it's not as simple as it seems, which is why there's dozens of huge billion-dollar companies who do this such as Costco, Sysco, US Foods, Shamrocks, etc. You just shop around and stay on top of food costs. And if you're a medium-large chain you lock down trade agreements much farther up the supply chain (producer level) to very low fixed prices for 6 months at a time. So if amazon wants to try to tackle dozens of intricacies for thousands of types of perishable goods that will have variable quality in a market that is heavily regulated by the USDA, more power to them. Source: I own a restaurant on the side.

Enforcing quality-standards for services rendered sounds nightmarish for either the end user or for the service provider. It's going to be interesting to see how this pans out for amazon.com.

I was also thinking redbeacon.com, although they've already exited to Home Depot so it's not so much of a concern.

Agreed, food / grocery delivery and transportation services would certainly be interesting, but defining the rates based on some sort of a base-cost-unit like mileage and speed of delivery would be extremely challenging to do smoothly for the end user. I think it would end up being non-satisfying for the customer and the sellers.

Besides, amazon.com has amazon fresh for the grocery delivery service needs. Why cut into their own business?

You're thinking about it incorrectly. Here's what the $200/hr developer does:

Identifies business challenges and offers a custom-tailored solution that will generate more money than it costs. Then that said developer will effectively pitch their prospective customer from that angle.

A business, if convinced you're correct and capable, will be happy to pay $500,000 to a developer who will develop software that will make them or save them $1,000,000 in the next year.

I was checking to see if someone else already wrote this. This is one of the first things I was thinking.

Not realistic if you run a business that actually operates in the real world.

I agree, it was honestly difficult to read this article and to reconcile the thought that I do business banking with Chase.

I've been thinking of a few non-profit startup ideas to combat this widespread corruption problem, but its nothing I'd want to discuss publicly in case I actually pull the trigger on it and desired to remain anonymous. I think you're thinking down the right highway of thought though.

Ah. I understand what you guys are doing now. This is an interesting and challenging concept to execute. I wish you guys success!

My only question remaining is how you guys handle shareholder liability since there's no corporate veil for partnerships. Is there some sort of general liability policy requirements, or is that kind of up to the people running the partnership?

I'm curious how this works with the legal landscape of US regulation.

I'm 99.9% sure the law would consider this equity compensation in exchange for labor performed, since this is being positioned as "getting a share" of the company. The only difference between standard "sweat equity in exchange for labor" agreements and this is that there are "coins" that represent a certain percentage of ownership instead of a standard contractual agreement bearing stock certificates.

That opens up a whole can of worms in terms of questions:

- Can the project owner further dilute the "coins" of the project, by increasing the total coin count? (Can prior work be diluted, thus lowering earning for prior work?)

- What kind of financial reporting requirements to companies have that work through assembly? Sarbanes oxley compliance? How do you know that they're reporting accurate earnings and not short-changing developers?

- Are these just "amorphous projects with a DBA" aka an informal partnership or are they all required to be corporations or LLC's?

- How about implicit liability?

If someone were to do an amount of work equal to 10-20% of a company's ownership equity, and the company did something illegal, wouldn't the developer have implicit ownership since he was profit sharing with the company? Would this open the developer to potential liability? (disclaimer: not an attorney, and it's been a while since I looked at related laws, but I remember reading some surprising case law that implied this a while back.)

- Possibly most importantly: How does this work with the SEC and IRS regulatory landscape?

How is this viewed by the SEC? The SEC requires that any exchange of securities be subjected to extreme regulations (you must take your company public to sell shares to public investors). When I raised money for my angel round, I had to seek SEC Rule 506(d) exemption just to provide shares to my initial investor base and to sweat equity to myself and my founder.

Most SEC exemption types carry additional reporting requirements for companies that have "non-qualifed" stockholders. This means monthly financial reporting that is SOX compliant by a CPA among other things IIRC. For the record, "qualified investors" have a net worth of $1mm+ or access to internal information that allows them to make knowledgeable investing (or in this case, investment of the developer's labor). These developers won't qualify simply by developing software for the company, as they need to have access to executive-level information.

In addition, SEC exemptions need to be filed by the actual companies in question. Those exemptions have a window of time during which they're valid. Different exemptions have different maximum non-qualified investor counts before the company must go public. That may mean that there's a maximum amount of different developers that can develop and receive sweat equity on a project before it reaches a ceiling, depending on interpretation of the law.

Finally, how does this affect the developer's taxable income? If he were to receive these equity shares (whether called "coins" or not), the IRS is going to deem these coins as having some sort of a value, just like stocks do. There's a lot of case law here, and typically it's going to work out to be (company valuation / ownership percentage = effective income amount). The IRS doesn't simply have you pay on dividends received from your equity, it has you pay the value of the equity as income as well, so how about with these coins? The IRS will see this as an asset received for labor, so how will this affect the taxable income of the developer? Do you require the companies on assembly to post a credible, running, monthly valuation by a 3rd party investment bank for taxation purposes? How do you handle the possibility of phantom taxation?

I apologize if this seems negative, I think the idea is (potentially) pretty sweet. I just hope you and your founding team talked with some good attorneys before building out this business. As a startup CEO myself, there's a lot of basic regulatory issues that I see with it which would have prevented it from passing the initial "idea vetting" process.

That was my first thought too, I use stevia in almost everything.

I suddenly had a flashback to selecting soundblaster as my audio device..

I thought ransom was supposed to work by making the person whom you have secret information pay you NOT to disclose the info. Especially if this "Jeffrey" knows the the Satoshi's true identity like the hacker says. That's not even mentioning that Satoshi almost certainly has way more than $20k in bitcoin (likely 100's of millions of dollars) and has a real interest in preserving anonymity. Wouldn't that make him personally the obvious target to extort?

Or maybe this "Jeffrey" is full of bs and has no real information, which would explain why he's trying to get money from the public. Obvious troll seems obvious.