HIP 38 passed , HIP 38A: Making an additional investment into The Oikos

HIP 38 has passed! The community has given the team permission to legally separate The Oikos project into its own company which will run and be governed independently of Hector Network. As a part of the detail the 3.6 M budget voted on in HIP 37 will become seed funding for the new company, entitling Hector Network to 12% of the profit of the new company in a profit transfer agreement.

HIP 38A offers Hectorians an opportunity to increase the position in The Oikos from 3.6M (12%) to 5.6 M (additional 2M for a total of 17%).

If you would like to review the full proposal in context of HIP 38 please do so here:

https://drive.google.com/file/d/10kcqCOR2GZXW0RFlhDY8fWEqivH6lDOR/view?usp=share_link Making an additional investment into The Oikos

If the community commits an additional 2 Million to the project an additional 5% in profit entitlement would be written into the profit transfer agreement, making the share of profit owed to Hector Network 17% of the profit payout pool.

There are both risks and benefits associated with allocating additional funds towards The Oikos project. To be abundantly clear this is a decision that Hectorians need to make for themselves, and we will provide facts but attempt to remain as objective as possible in the discussion. We encourage heavy discussion in the community and will answer as many questions as humanly possible on this topic.

Benefits: Of all the sub-brands developed by Hector Network, The Oikos has always represented the largest potential revenue stream. An additional 5% of profit could represent millions of dollars in steady yearly revenue in the future. The additional investment could ensure a smooth launch for a key investment. An additional 2M upfront allows The Oikos team to extend the development runway from June 2023 (with budget to hire 4 people, CEO, CFO, COO, CMO) to into September and hire 17 people, (CEO, CFO, COO, CMO, CTO, Business Developer, Partnership Manager, Marketing Manager, Socials Manager, Accountant, Mod Staff for Social severs (x5) 2 Artists (for Marketing department). This extended staff greatly increases the company’s chances of swiftly landing key partnerships, landing venture capitalists and having successful NFT sales. Risks: Should The Oikos fail a larger share has been committed and is therefore lost, choosing to not invest further in The Oikos could provide more diversification to mitigate failure. If the market conditions continue the additional 2M strain on the treasury could reduce Hector Network’s runway and perhaps the project would go broke before it is able to benefit from the profit of The Oikos. A 2M investment might perform better if invested in another way, and produce more ROI than with The Oikos A 2M investment might perform quicker if invested in another way, and return funds to the treasury before profit from The Oikos kicks in.

To make savvy investment decisions the community needs to understand where we stand in the current budget for the last 6 months and what sort of environment the next budget HIP will be in.

Currently we are just over half way through the budget period and we are significantly under budget. You can review the current budget position & predictions for budget remainders for the end of the period here.

https://drive.google.com/file/d/1TbRRJkcAv6_lxK4TSLWTod3DK9qcRSPu/view?usp=share_link

Final numbers for the budget for next period are still being tabulated but by all accounts the next period will require notably less funds than allocated for this one. Predictions put that budget between 4-7 M for the 6 month period of April 2023 through to September 2023, and as shown in the charts above some of those funds will be able to roll over from this period. This is largely due to development for several major projects wrapping up between this period and the next, and the high cost of development transitioning to the much lower cost of operations.

The voting options for HIP 38A:

1. I want Hector Network to commit an additional 2 Million in exchange for a total of 17% of the profit payout pool.

2. I do not want Hector Network to commit additional funds towards the new legal company, and am satisfied with 15% of the profit payout pool.

3. I am unhappy with any of the presented options and supporting data.