From the back office of Zurker.

What's all the buzz of vShares

Zurker isn't your average social network for many reasons, the foremost being that users can own vShares in Zurker. vShares are an innovation designed to democratize the social network, spur growth, and lay the framework for the development of the best social networking app since the dawn of time.
What are vShares?
 
 
vShares are a stake in Zurker. Specifically, vShares are units of equity in the Zurker Project allocated to members during alpha and beta testing. While vShares are a form of ownership, vShares shouldn't be confused with shares or stock, as Zurker isn't a public company yet. vShares can be thought of as agreements between the owners of a startup about the size of their stake in the enterprise to be incorporated. Such agreements are common amongst founding investors whenever a business is launched; however, with hundreds of thousands of investors owning vShares in Zurker, the number of owners is larger than usual.
How are vShares disbursed?
 
 
vShares are allocated to members in exchange for inviting their friends to Zurker. vShares may also be purchased for cash.
What use are vShares?
 
 
One vShare is equivalent to ownership of 1/1,000,000 of Zurker. When 1,000,000 vShares have been allocated, Zurker will be restructured as a public corporation and vShares will become real shares. (Incorporating a company with 1,000,000 stakeholders is a complex and challenging undertaking logistically and financially, requiring a dedicated team and considerable financial experience, expertise, and resources, which is why we are not doing it now.)
In other words, vShares entitle the owner to own equity in Zurker, and shares in the future Zurker corporation.

Why does Zurker give out vShares?
 
 
In conventional startups, small groups of investors own the entire company. The first investor provides the seed capital, which is usually used for initial development. Seed capital is typically less than $20,000. Once a product is ready, 'angel' investors enable expansion with investments of about $250,000 or more. If the startup performs as expected, VC's (venture capitalists) come in with millions in funding.
Since the development and growth are funded by small groups of just a few people, fortunes can be made. In the case of Facebook, for example, one of the early investors, Peter Thiel, now owns a stake worth about $1.5 billion. It's no wonder that many of the world's fortunes and super yachts are owned by Venture Capital investors such as Tom Perkins.

vShares enable Zurker to grow without relying on a small group of outside investors. Some vShares are purchased with cash, financing servers and other expenses. Other vShares are disbursed in exchange for referrals (successful invitations of friends to Zurker). The cost of user acquisition is often estimated to be about $7.50; to this day Facebook continues to advertise for new users, spending probably $15 ~ $20 per new account.

Compared to advertising, vShares are a low-cost alternative for driving the growth of the user base and traffic.

What is the value of a vShare?
 
 
Currently, vShares are priced at $1.00. Zurker will be incorporated as a company when 1,000,000 vShares have been allocated. At that juncture, the value of a vShare should be about ten times as much, as successful startups with more than 500,000 users can easily gain a valuation of $5+ million.
If Zurker were to continue to grow and attain a valuation of $50 billion like Facebook, each vShare would be worth $50,000. Of course, it's unwise to assume that Zurker will attain the same level of valuation as the current market leader.

Bebo was sold to AOL for a more down-to-earth $800 million. At that level of valuation, each vShare would be worth $800. MySpace was sold to News Corporation for $580 million - about $580 per vShare.

The above estimates are based on capital gains. If Zurker were never to sell out - and a user base of owner-investors would probably oppose selling out to a large corporation - the value of vShares would be determined by the earnings of the company and the dividends paid quarterly. If Zurker earns a net profit of $100 million, then each vShare would entitle the owner to a pretax income of $100. If you own 10 vShares now, that would translate to an income of $1,000 per quarter.

Are there additional benefits to vShares?
 
 
The issuance of vShares ensures that every member can also be an investor and a co-owner. With a member base comprised of people with the best interests of the project in mind, Zurker will benefit from the collective creativity of many thousands of minds.

Members who are also owners will help the operations team develop the best social networking product, bar none. Facebook and Google+ may have highly talented engineers, but no elite engineering team can beat the innovative power of 500,000 passionate members who each have a stake in the success of the project as a whole. Recent history has taught us one thing - democracy always triumphs.

Join this incrediable program: http://linktrack.info/zurker

Regards:

To your success, Own the Future:

William