Hey everyone,
I regret to inform you all that I have decided to pull out from this business venture. As much as this was a great idea, both for you guys and for myself, the risks are simply too high for me to want to invest that amount of money. After discussing the idea at length with some of you over skype, many of you pointed out that this was a "bold" idea and a lot of things could go wrong.
Of course I was aware of the risks before posting, and the risks are in fact the reason I believe this has never been attempted before. However after the discussions I had with some of you last night, I have to say I have been turned off from the idea. I will of course go through my thought process and list the reasons I have decided to pull out below:
Regards,
Hyper
I regret to inform you all that I have decided to pull out from this business venture. As much as this was a great idea, both for you guys and for myself, the risks are simply too high for me to want to invest that amount of money. After discussing the idea at length with some of you over skype, many of you pointed out that this was a "bold" idea and a lot of things could go wrong.
Of course I was aware of the risks before posting, and the risks are in fact the reason I believe this has never been attempted before. However after the discussions I had with some of you last night, I have to say I have been turned off from the idea. I will of course go through my thought process and list the reasons I have decided to pull out below:
- The first and possibly largest risk which I faced was the fact that I would not be able to guarantee the top slot. As prices for slots fluctuate so often, it is impossible to actually know how much each slot is going to go for each auction. Of course you can be safe in the knowledge that if you bid around $4000 you are guaranteed a slot, however which slot you will never know. Therefore if I was even outbid, by $1 I would only get the second slot. Which of course would lower the value of the slot, and cause a lot of you to pull out from the deal, losing me a lot of money. The only way I would be able to some how "guarantee" the slot would be mine, would be to bid in the region of $4500-$5000, although even then nothing is certain.
- The second risk I faced is the trust between myself and you guys, and the fact that I would need every single one of you to stand by your offer and pay for your slots. Of course this is trust relationship varies from user to user, depending on how well I know you myself, and the respect and "rep" you have within the community. However as more and more 1 post, new to the forum users were reserving slots it became incredibly hard to know if everyone would pay up. Now I could have restricted this thread to only allow people I know personally or members of the community who can be trusted, to purchase slots. However this would have given me 0% chance, of filling every slot.
- The third reason I have decided to pull out, is the fact that it does not seem likely that we are going be able to fill every slot on the sheet by the time I am required to bid and pay for the slot. Of course it would not be necessary to fill every slot, however at this moment it seems unlikely with the number of slots taken and the rate at which they are being taken, that I could even beak even from my investment.
- My fourth reason for pulling out, is a mixture of everything above. What it all comes down to, is the return which I could expect to make back from my investment. So it's time to crunch some numbers. Taking my first point into consideration, I would need to invest at least $4500 to guarantee the first slot. Now if I rented out every hour on the sheet, it would give me $5560. Making me a return of $1060 on my investment. Which all sounds great, everyone renting a slot gets to save money with the cheapest prices ever and I get to make a nice return for the risk of investing my money. However, taking into consideration my second and third reason above, there is no way I could expect to make the whole $1060 back. On top of which, we have to take into consideration PayPals currency conversion and cross border payment charges, which would reduce my return by between 3-5%. Which leaves me with around $1000. Which of course will then be taxed at 45%, and leave me $450 left over. So, overall if every slot was sold out, and everyone paid up, I would be making a profit of $450 which is a 10% return on my investment. Personally that is not a big enough return for me to risk such a large amount of money, knowing that it could be far less than that as not every slot will be taken and not everyone will pay up.
Regards,
Hyper
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