Learn how to show in kind investments
For example, let's imagine one of your companies has a 50k investment through a trust agreement and a 100k investment through in kind contributions. When your shares are converted, they will be converted based on a 150k investment rather than the 50k cash investment.
There are a few ways to express this in Rundit.
- You can buy 50k worth of equity and buy the exact number of shares you got with 150k. Then you could adjust the share price so that your equity is immediately worth 150k. In other words, you bought discounted shares.
- You can buy shares with 50k and then do a state update where you add more shares to your ownership.
- There is an instrument called equity received on the platform which can be used for in kind payments. You could add the 50k as a convertible and as a separate transaction equity received worth 10 k.
Another example: You provided labor worth a certain amount of money, which essentially represents an investment in the company. Later down the line you are compensated for this work with shares.
1. You can use convertible note instrument to reflect this scenario in Rundit. Add the value of work as a convertible note. Add the compensation for the work as a convertible note conversion. This way Fair Value calculation takes into account the number of shares, but not the value of the services you provided (as the shares already represent the work you provided).