Different type of funding. I've used this type of funding before.
"If company A is looking for 10 investors to get 1 million in funding for 80% cut of spoils through LPs
Yet it only sells 2 and does not reach that funding level how could the 2 investors still get the 80%?
"
The answer (using your numbers as an illustration.) is that if 10 investors invested, there would be 10 LPs and the $1MM owed. If $10MM were found, and $5MM were given as the split, then 80% of $1,250,000, or $1,000,000, would be the first tranch given to the LPs. If only 2 were sold for a total of $200,000 raised instead of $1,000,000, then 80% of $250,000, or $200,000, would be given in the first tranch, and that part would be satisfied earlier since there are less investors. That's what I meant by a lower cap. It's still 80%, not a lesser percent, but, based on a lesser dollar amount owed.
And if the amount found was only $100,000, then regardless of whether the company sold $1,000,000 or $200,000 in LPs, 80% of that $100,000 would go first to the LPs, because it would not be enough to cover either one of the numbers needed to return the principal to the investors (Whether $1,000,000 or $200,000)
The formula is more complicated than that, with the LPs getting different off the top amounts as they are paid back and then as they earn profit. It was not that bad of a deal for the LPs OR for DPBE when done. I just don't like people forgetting now, after the fact, that the LPs DID happen, and so artifacts and profits WILL come off the TOP in order to pay them back. We loved them when they were sold, as the way to keep working. Now though, we want to say that we get 50% of what is found as "our portion", and no longer want to include the LPs in any formulas of what the company retains. Whether some people like it or not, they are not "imaginary"! And they WILL be paid BEFORE the company. As they should , since they gave the company money to continue to dive. Stating that they exist and get paid a large percent of what is found in the beginning (With caps on it) should not be denigrated to skew reality of what the company gets to keep. We will get very little relative to what was found in this division. Look, I'm not a super bear of all things like some on this board. I'm also not a super bull, like others. I try to correct errors of fact, and also give my opinion from time to time. One of the biggies though that is touted and is wrong is that the company keeps 50% of what is found. No, they don't. Just like the DR takes off the top, the LPS and London take off the top too. The company gets les than 50%. A lot less for now. And that is FINE, since it allows us to continue DIVING. It still has to be factored in though, even if the exact amounts of how much the treasure is worth is not known yet at this time. It can't be ignored just because the firm number is not there yet.
So yes, the answer your question, it is 80% even if not all the units were sold, but 80% up to a lower upper limit. Which still seems to me to be higher than the amount we shall be getting in THIS division. Oh ... IMHO on that last sentence, of course. LOL.
