We’re open to ideas for improvement. How would you change the initial compensation proposal to be fair and reasonable for both Index Cooperative and Titans of Data?
I don’t know the right answer, I guess it will require people more knowledgeable than me on the past discussions regarding the methodologists compensation. If there is a group working on this, I would be happy to participate.
However I wanted to expose my concerns regarding this proposal (and potential future ones), it seems that the value going to the methodologists is very high relatively to the benefits for the Coop.
If we take the target of $100m AUM, we would have the following numbers after one year (assuming $23 price for INDEX):
- net result for methodologists: 200000x23 + 285000 = 4885000 ($4.9m)
- net result for Index Coop: -200000x23 + 665000 = -3935000 (-$3.9m)
With constant fees, it would take 6 more years (3.9m/665k) for the Coop to be profitable. And I am not even taking into account the running costs. It seems to me like a not very attractive investment.
Still, I like the product and it is great to hear that IP is still on the horizon!