What is the tibdit fund? [DRAFT 4]

THE TIBDIT FUND comprises (500,000) 600,000¹ units with a face value of 1mBTC (0.001 Bitcoin) each.

TIBDIT LIMITED, a limited liability company incorporated in the United Kingdom, is developing and will provide a patent-pending service that facilitates online micropayment transactions.

THE TIDBIT FUND, comprises 20% of the total equity ownership of TIBDIT LIMITED as at the launch of THE TIBDIT FUND on NN-Feb-2014.

TIBDIT LIMITED has resolved to make an initial public offering through Havelock Investments of (250,000) 300,000¹ (50%) units in THE TIBDIT FUND, representing 10% of the total equity in TIBDIT LIMITED at the time of issue; the remaining 250,000 units in THE TIBDIT FUND will be held by TIBDIT LIMITED and may be offered publicly or privately by the directors of TIBDIT LIMITED at a later date if such an offer is determined by them at that time to be in the interests of TIBDIT LIMITED and it's shareholders, including holders of units in THE TIBDIT FUND.

¹ TIBDIT LIMITED is seeking GBP £100ᴋ of funding for a 10% equity stake. While we acknowledge volatility in the bitcoin exchange rates is normal, we have asked that Havelock Investments revise the number of units in the FUND to reflect the recent sustained drop in bitcoin value relative to other major currencies.²

² Given the present volatility in the market, and that we cannot predict future movements, the only reference point we can use is the exchange rate available at the time of announcing the listing. Correspondingly, we are exploring asking that Havelock apply the following rules to determine the number of units comprising THE TIBDIT FUND based on the prevailing USD/BTC rate:
$625-$775, 500ᴋ units   $525-$625, 600ᴋ units  
$450-$525, 700ᴋ units   <$450, 800ᴋ units.

Until such time as Havelock Investments announce the launch of THE TIBDIT FUND on their platform, all the above details should be considered as subject to change with no notice. The details as published by Havelock Investments will be the authoritative statement of fact in regard to the structuring of THE TIBDIT FUND.

What's taking so long? [DRAFT 4]

tibdit apologises for the delay in announcing our investment funding offer via Havelock Investments.

We will be a global (micro)payments service, which neccesarily includes ensuring that the structure of the offer and the vehicle (THE TIBDIT FUND) are appropriate in that context. We are waiting on the legal drafting of a document that will provide the basis for how the 20% share equity in TIBDIT LIMITED allocated for THE TIBDIT FUND will be managed and protected in the interests of all the parties involved.

Given the nature and ambition of tibdit, we have elected to add an extra level of security on top of the standard Havelock Investments listing agreement between them and ourselves.

This will take a few days yet, and hopefully by that time the bitcoin volatility induced by Mt Gox will have stabilised somewhat. (26/02/2014)

How does tibdit work?

• users (tibbers) sign up with the service (tibdit) in order to send micropayments (tibs), which may be either (a) gratuities or (b) access-fees, to 3rd-parties (tibbees).
  
  
• tibbers set the value of their own tibs in their own (or a preferred) currency, e.g. a UK tibber will be able to set a value between 1.5p and £1.50. We intend to support GBP EUR USD and XBT at launch, and add many other currencies subsequently. tibber deposits are held in their selected currency to minimise exchange rate risks, and tibbers using fiat currencies are not exposed to bitcoin at all.
  
  
• tibbers are required to purchase tibs in blocks (of between 10 and 500) at their chosen value per tib, and to use up one block before using another - the balance between paying access-fees and paying gratuities from the same block ensures tibbers set a fair value for their tibs. tibbers are encouraged to set their tibs at whatever value means they "don't have to think twice" before tibbing. We expect an average tib value of around 15p/25c.
  
  
• tibbees are not made aware of the value of each individual tib, and are prohibited from requiring multiple tibs before providing access in return. This means they must treat every tibber identically. tibdit delivers an average value per tib, and so tibbee income will be driven primarily by the volume of tibbers accessing the tibbee’s content or service.
  
  
• We pay tibbees 90% of the tib value in bitcoin (XBT) from a float. Globally common bitcoin addresses mean we do not need to register tibbees - at the simplest level, a tibbee needs to do nothing more than put a link to tibdit containing their bitcoin address on their site. Charging a tib for access to content or for services obviously requires a bit more work for the tibbee’s web developer; but nothing changes whatsoever for tibdit, regardless of how the tib is used.
  
  

How have you valued tibdit?

tibdit is offering 250,000 shares at 1mB͈̎ in THE TIBDIT FUND. This equates to a ten percent stake in TIBDIT LIMITED. The funding sought through this offering is approximately GBP £100ᴋ (at B͈̎1 = £400)

Therefore, we have valued TIBDIT LIMITED for the purposes of this offering at GBP £1ᴍ, and it is reasonable to ask how we arrived at this valuation, and why we believe it is fair.

Determining an accurate and true value for a pre-revenue company with no active equity trading is impossible. It comes down to the team, the concept, the risks, and a very subjective analysis of those. We can emphatically state that if someone offered to buy tibdit for $1ᴍ right now, we would decline.

The team that has come together is impressive: The diversity across seven individuals, in skill sets and outlooks and personalities, is stark. And yet all are excited, committed, and everyone gets along.

Will the concept work? We are well aware of the history of non-niche casual micropayment startups. But six months in we have yet to uncover or be confronted by any reason it shouldn’t. Most people readily relate personal examples of how the concept could be applicable to their own online experiences.

This is the basis on which the founders, having contributed £40ᴋ of their own funds and having taken major life decisions to increase their availability moving forward, have determined to make this equity offering and move tibdit up to the next level.

As a micro-transaction platform, volume is key, and it will take some time to ramp up, but we should know within a few months of launch if it is taking off or not. It seems unlikely that there is a middle road for tibdit between the extremes of failure and viral success - all anyone can do is make an assessment of the probability of those outcomes.

Why £1ᴍ? We need £100ᴋ to get to the end of September this year with a reasonable cushion. September marks the end of our first financial year, and within that timeframe we will collect several months of data from live, revenue generating operations. We will use this data to obtain further funding to see us through to profitability. We conservatively forecast that we will achieve net profitability (month-on-month) before September 2016.

The 10% equity is more arbitrary - it comes down to estimating the minimum percentage we can offer and still have a realistic expectation of achieving our current funding goal via Havelock Investments. And it’s a round number.

To put the opportunity into context, by 2017 we expect more than one major media outlet to be receiving micropayments through our platform, with a host of smaller publishers similarly providing paid access. In addition there will be a vast number of free sites accepting micro-donations through tibdit. Our resulting forecast for net profit for the year ending September 2018 exceeds £5ᴍ. This is based on assumptions of a user count approaching 8ᴍ, an average transaction of 15p/25c, and an average per-user transaction frequency of every other day.

It is for potential investors to assess for themselves whether the odds seem as good to them as they do to us.

Why have you applied for a patent?

tibdit has filed US Patent Appl. No 61/938,980 covering significant elements of the tibdit solution to the casual online micropayments problem.

We are well aware that misuse of the patent system in recent years by many organisations, especially around patents for inventions encoded in software, has resulted in some people viewing such patents as inherently ‘wrong’. In that context, along with the rather more severe abuse of the copyright system that continues to unfold globally, we expect that some may regard any form of intellectual property protection as invalid.

That said, we wish to reassure the community that nothing in this patent application is specific to bitcoin and that, to the best of our understanding, nothing in the patent intersects with the recent micropayment additions being incorporated into the bitcoin protocol.

Our purpose in filing this patent application is to protect what we believe to be our novel solution to an old problem, without some established and well resourced organisation implementing our approach before we are able to gain traction and see for ourselves if our concept is viable (which we naturally believe to be the case). While we expect that the viability of the tibdit approach may be demonstrated for real well in advance of the patent being examined, we are confident that the disclosures within the application are indeed ‘new art’ and that the patent proper will ultimately be granted. The patent application should be published by the USPTO eighteen months following 13th February 2014.

tibdit supports (and is built upon) both bitcoin and open-source software. With the window of exclusivity ensuring at least some chance of success, we look forward to being in a position to make that support tangible in the future.