đĻMutual Fund
Mutual funds give small or individual investors access to invest. Each shareholder, therefore, participates proportionally in the gains or losses of the fund.
In the simplest model, there are only 3 main stages of working with NEO DAO:
Raising Funds. LP burning is off. LP offer is activated;
DAO earning process. LP burning is off. LP offer is deactivated;
Profits distribution. LP burning is on. LP offer is deactivated;
Repeat.
We can run a private round and a public one first. We can have the first round only private or only public.
How is a private offer different from a public offer?
A private offer makes it possible to buy only a certain amount of LP tokens for a specific user.
A public offer allows an unlimited number of users to buy an unlimited number of tokens.
Private Round - We can create a private offer specifically for one investor. We set the price in a specific asset, and the number of NEO LP tokens that will be redeemed at the specified price (there are no restrictions here). After purchase, the offer will be deactivated automatically. NEO DAO will receive the proceeds from the sale of NEO LP into its account.
Public Round - Wa can create a public offer for many participants. We set the price for 1 NEO LP. NEO DAO will receive the proceeds from the sale of NEO LP into its account.
For example, consider this case: We sold 10 NEO LP to one participant in a private round for 200 USDT. 1 LP = 20 USDT.
NEO DAO earned 200 USDT in a private round.
We also sold 1 NEO LP each in the public round to 10 members at a price of 20 USDT.
NEO DAO earned 200 USDT in the public round. DAO AUM (assets under management) 200 + 200 = 400 USDT.
In total, NEO DAO distributed 20 LPs. A member with 10 LP has 50% of the NEO DAO share. A member with 1 LP has 5% of the NEO DAO share.
NEO DAO earning process:
In our example NEO DAO by its actions was able to earn +100 USDT. NEO DAO AUM 400 + 100 = 500 USDT. How will the profit be distributed among the participants now? Participant with 50% share, 200 USDT -> 250 USDT. Participant with 5% share, 20 USDT -> 25 USDT.
Exit NEO DAO:
At this stage, NEO DAO does not make money and does not invite new members, but gives the current members time to exit. Let's say no one wants to leave NEO DAO this time. The shares remain the same.
Second round of fundraising:
Now it is important to determine the value of theNEO LP token in order to raise funds again and not depreciate the shares of contributors from the first round.
We will use the following formula:
Or simply: NLP Price = NEO DAO AUM / NLP Total Supply
In our example: 500/20 = $25 (we can also slightly increase the NLP price this time so that previous participants get a small profit at this stage).
We create another public offer. We set the price for 1 NLP = $25. Our token was bought by another 10 people, 1 NLP each and NEO DAO received into the treasury + $250.
Total NEO DAO AUM is 500 + 250 = $750.
The shares are distributed as follows: NEO DAO handed out 30 NEO NLPs in total. The participant with 10 NLP has 33.3% of NEO DAO shares. A member with 1 NEO NLP has 3.33% of NEO DAO shares.
The money is distributed as follows: Participant with 33.3% share, 250 USDT -> 250 USDT.
Participant from the first round has a 3.3% share, 25 USDT -> 25 USDT. The participant from the second round has a 3.3% share, 25 USDT -> 25 USDT.
NEO DAO earning process:
Let's say NEO DAO managed to earn x2 at this stage.
NEO DAO AUM = $750 + $750 = $1.500.
Participant with 33.3% share, 250 USDT -> 500 USDT.
Participant with 3.3% share, 25 USDT -> 50 USDT.
Exit NEO DAO:
After successful deals, some of the partners decided to leave.
Let's say 5 people with 1 NLP decide to burn their tokens and exit. There are 25 NEO NLPs left in circulation. NEO DAO AUM = $ 1.250.
Participants' shares and earnings were distributed as follows: Participant with 10 NLP, 40% share, 500 USDT -> 500 USDT. Participant with 1 NEO NLP has 4% share, 50 USDT -> 50 USDT.
Rule #1 How to distribute profits among investors? NLP token is the very mechanism of profit distribution. Investors earn as long as they hold NLP tokens. To exit with profits, they burn their share. This burning will be manually activated on predetermined dates.
Rule #2 How do you keep our investors safe? By activating burning NLP tokens and without freezing this rule. We can also select specific days for participants when the burn function will be active. The burning function will be turned on and off manually.
The provided figures and information are approximate and for informational purposes only. They do not constitute a guarantee of income. Please note that all investments carry a risk and past performance is not indicative of future results. Investing in NEO DAO or any other investment opportunities carries a risk and potential investors should conduct their own research and seek advice from a financial advisor before making any investment decisions.
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