Re: [wg-c] non/for profit

[Eric Brunner <brunner@world.std.com>]

Jon,

I suppose it may be educational to consider Milt's thesis that the two models
are indistinguishable, and run the pricing pony round the barrels, however...

The two general forms of corporations under discussion are distinguishable
by their access to capital, and as we've seen the price of commodity PCs
actually go to zero, and the retail price of browsers stable at zero, it is
possible that any ceiling may be too high. A for-profit with a business plan
which is revenue-negative until market share goals are met, or permanently
revenue-negative with indirect recovery, will have access to capital.

The synthetic numbers from p228 of this month's Red Herring (the monthly of
choice of Soviet fisherpersons) for dorky B2B start-ups is $10M 1st round,
$20M 2nd, and more cream at mezzanine -- and these guys can't point at the
NSI direct, or potential indirect revenues, or decade-long exponential rate
of market expansion to motivate their VC readers.

If you assume that telcos, handset OEMs, other "convergent technology"
lemmings, and mass-market e-service retailers all place a non-zero valuation
on the NSI data, distinct from the annual data renewal revenues, and I do,
the liklihood of our for-profit ponies all starting from zero is close to
that value.

In either case, anyone playing at being a for-profit with less than $30M
when the bell rings is a consolidatee, and late ponies will be rendered
before post-time, as the VCs won't buy the same product more than a few
times.

On the other hand, it is unlikely that non-profit corporations will be able
to engage in a series of spectacularly negative-revenue quarters, betting
on the come of providing value-added services beyond mere lease of names,
or of becomming too big to fail to attract another capitalization round.

Postel handed out ccTLDs to _individuals_ with little more than an academic
sinecure and their underwear, and the problematic non-profit TLDs created
in that process are few enough that out of 200+ non-profit TLDs, we actually
know them by name.

You asked if anyone had any suggestions other than a "ceiling price". I do.

You may want to consider a floor price. Figuring out what useful things
to do with some disposable income may be an easier task than explaining
the alternative.

Cheers,
Eric