Friday, September 15, 2017 1:21:13 AM
For example, if 1M USD from GLEC was used to fund the operations of GECO, and GECO raised 1M USD privately from investors, then GLEC would own 50%, and other GECO investors 50%. Or if GECO investors got a 10% discount as incentives to invest directly into GECO, then it would be 40%/60% for example (math is different but you should get the idea).
Let's say its 50% GLEC, 50% private - Now if GECO goes from a 2M company to 20M, then the GLEC ownership of GECO would be entitled to half the cashflow / valuation of the company since it owns 50%. And then GLEC would distribute that to its investors, i.e. everyone on this board.
Before you ask why private money was raised and GLEC cut down to 50%, it's because thats how you raise money...and if the money wasn't raised, then the company would already be dead.
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