Business model
Revenue comes from one fixed administrative load
The partnership does not lend, does not charge interest, and does not take spread on member money. It charges a single administrative load, fixed at the point of enrolment and spread across the whole term.
Unit economics
What members pay, and what it covers
19% of the credit face value, all-inclusive. No origination fee, no monthly service fee, and no interest at any point in the contract.
- 12% · Operations
- Administration and running the program.
- 5% · Reserve fund
- Held against member default within a group.
- 2% · D&O insurance
- Directors & Officers coverage.
Why 19% is not comparable to a 7% mortgage rate
The two numbers measure different things. 19% is the total cost of the entire contract, charged once and spread across the term. A 7.2% mortgage rate is charged every year and compounds, which is how a $400,000 loan accumulates roughly $559,000 of interest across thirty years.
Why the revenue is predictable
The load is set when a member enrols and does not vary with rates, credit markets, or asset prices. Partnership revenue is therefore a function of one variable: how many members are contributing, and at what average monthly amount.
Scaling
Revenue tracks enrolment, and nothing else
Modelled throughout at an average contribution of $500 per member per month. Multiply members by contribution to get monthly inflow, annualise it for AUM, and the 19% load falls out of that.
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Members contributing
5,000
Base case, start of 2027.
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Average contribution
$500
Per member, per month.
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Monthly inflow
$2.5MM
Members multiplied by contribution.
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Administrative load
$5.7MM
19% of annual AUM of $30MM.
Investor participation
Where investor distributions come from
Distributions to this round are funded out of the administrative load the partnership already collects, not from member contributions and not from new investor capital.
Source
10% of the 19% administrative load is allocated to the investor pool. As members enrol and AUM grows, that pool grows with it.
Capital amortisation
Principal is returned progressively across the three-year term rather than in a single repayment at the end, and accelerates as the program scales.
Interest
8% per year on the outstanding capital balance, for a cumulative 24% across the full term.