Summary Points

• use prediction markets to start and run a startup company
• raise $25,000 to operate during the Puppet Inc phase of a company's existence
• investors have to have a net worth of less than $500,000
• all decisions made through prediction markets
• must have a business plan, product / service idea, logo, company name, generate at least $1 of revenue before leaving the Puppet Inc stage

What is it?

Puppet Inc! is where investors create and run a company collectively. Investors invest money in a blank check company. Once the funding is complete (based upon a minimum amount raised and an end date), the company is created and investors decide what the company will do, what the company's name should be, what the company's logo will be, and so on until the company has developed a product or service and taken that product or service to market.

Restriction: The resulting company must take a product or service to market within 18 months (so another company can enter the "Puppet Inc" stage).

What is the minimum amount that needs to be raised?

$25,000

Who is operating the Puppet Inc! concept?

John Mueller. To contact John Mueller, go to the contact us page.

How is the Puppet Inc! concept funded?

The concept was started and is funded by John Mueller puersonally. In the future, hopefully a corporate sponsor and a university sponsor will help fund the Puppet Inc! concept.

How much is each share?

$100

How many shares can an investor buy?

An investor can buy only 1 share.

Why is there a limit on the number of shares an investor can buy?

An investor can only buy 1 share so that no one investor has a larger owwnership share in the company than another investor.

Where does the my money go?

When an invest buys a share of the resulting company, the money will be held in a PayPal account in escrow. Once the investment period is finished that PayPal account will be the resulting company's financing account, with a second PayPal account setup to pay for future operating expenses of the resulting company.

If for some reason the offering is not fully placed by the end date, then money that was received in the PayPal escrow account will be returned to each investor that submitted funds.

Is there a fee to buy a share of the company?

Yes, there is a fee to buy a share. The fee is $3.20. This fee is charged by PayPal for transferring money into the escrow account. So when you purchase a share you will be charged $103.20, with $100 going into the escrow account and $3.20 being paid to PayPal for their service.

Schedule

To be determined.

How will investors make decisions for the company?

Investors will make decisions through prediction markets. Each investor will have a set amount of funny money in their prediction market account to make decisions. So the investors that decide correctly will be able to make more decisions in the future.

The prediction market software is currently being created by John Mueller (he built GolfInvestors' market -- http://golfinvestors.com). It would have been preferred to use Inkling Markets and their prediction market software. However, the cost to license / use the software is above our low budget.

How will investors make money on their investment?

Investors make a return on the money when the company becomes a full fledge operating company and the company has either started generating positive cash flow (to take dividends from the company) and / or the company's valuation increases and is sold to another company.

Are there any advisors which investors can call upon?

John Mueller is setting up an advisory board to help him operate the Puppet Inc! concept. As for an advisory board for the companay that investors setup, the investors will decide who should be on an advisory board and also the board of directors.

Who will do the work in the company?

People can be hired or investors can help out in the work. However, the investor base has to decide collectively who will be hired, who much each person will get paid, and so on.

As well, employees of the company must become investors of the company. So as part of their employment agreement, employees must purchase 1 share of the company with their own money.

Will the share price increase

The share price will not change while the resulting company is still in the Puppet Inc! concept stage. Only after the company has exited the Puppet Inc! stage will the share price be able to change either up or down.

What happens if the company needs a follow-up round of financing?

If the resulting company needs additional funds to operate, then the company must exit the Puppet Inc! stage and move on.

Use of the Puppet Inc! domain name: puppetinc.com

The resulting company can utilize the Puppet Inc! domain name puppetinc.com while the company is still in the Puppet Inc! stage if the resulting company so chooses. Once the resulting company exits the Puppet Inc! stage, then the company needs to use its own domain.

What is in it for John Mueller?

Just like every other investor, John Mueller will buy 1 share in the company and get to vote as an equal shareholder in the decisions that are made by the company. He does not get paid compensation for managing the process activities while the resulting company is in the Pupupet Inc! stage. The main reason why he is building the Puppet Inc! stage is to see if investors can build and run a company collectively. The resulting data will help him with is doctorate work.

However, since John Mueller owns the Puppet Inc! concept and there are expenses involved in building and running the Puppet Inc! concept, he will generate revenue to cover these expenses from branding the concept through franchises, advertising, and sponsorship agreements.

Are there any advisors which investors can call upon?

Investors will decide if an advisory board should be put in place and who should be on the board. As well, the investors will need to elect a board of directors accordingly.

Why raise $25,000, and not more or not less?

Why make the shares priced at $100 rather than more or less

Who can buy shares?

Anyone 18 years or older that has $100, has a net worth of less than $500,000, and is willing to participate in making decisions for the company.

Why have to have a net orth of less than $500,000?

Want every day people to be in involved in owning a startup company. Once the company has graduated from Puppet Inc, then follow-up rounds do not have any of the Puppet Inc restrictions if they do not want to have them.

How do you, as an investor, make a positive return on the $100 you use to buy 1 share

If the value of the company increases, the value of each share will increase during the initial stages assuming there is no dilution of shares. Once additional funding is needed for the company, additional shares will need to be issued, and your ownership will be diluted. In any event, your goal as an investor is to help increase the value of the company and if you do that, you will make a positive return on your investment.

How to get my investment out of the company?

By selling your 1 share or by gettinng paid a dividend from the company. The company will not be paying any dividends while in the Puppet Inc stage, so the dividend would have to be paid in the considerable future if you have not already sold your share.

How do I sell my 1 share?

While still the company is still in the Puppet Inc! stage, if you as a shareholder want to sell your 1 share, you can do so via a section of this web site that will be setup in the future to allow you to tell others you are willing to sell your share and at what price (i.e. quasi stock market). The only restriction is that you must use that area of the web site so we can transfer the share officially between the shareholders and so we know the price of the share.