Crowdfunding GWR Toplights poll

[Neal Ball]

Please see the main thread for the arguments and suggested carriages: http://www.rmweb.co.uk/community/index.php?/topic/118689-gwr-toplights-poll/page-1

 

That poll has been running since January 2017 and at this point has voted from 126 members. Whilst just over 42% are saying under £50 it’s probably more realistic to be paying £60 to £70 for a carriage made to 2018 standards.

 

There doesn’t seem to be any interest from the RTR manufacturers, would you therefore join a crowdfunding group? It has been suggested £1000 to join (subject to minimum numbers) with maybe £70 per carriage.

 

This isn’t costed at this stage, we need a CAD designer, then a manufacturer, it’s all pie in the sky at this stage, but would you sign up?

 

To choose exact diagrams, please use the initial Toplights Poll.

Edited June 19, 2018 by Neal Ball

[Colin_McLeod]

£1000 to join and £70 per coach by my arithmetic means 14 coaches each funder. Is that what is meant?

[Neal Ball]

It’s only finger in the air to gauge opinion.

 

Possibly an initial investment buys you into the project as a shareholder. With possibly a minimum order book needed, a) before production and b) possibly before a return.

 

C) could be, would you commit to x number of carriages in order for the project to get off the ground.

 

Given the majority said they wanted to pay less than £50 would people really pay £70? That’s the test.....

 

The poll has been amended to include this as an option.

Edited June 19, 2018 by Neal Ball

[Clearwater]

There's a number of ways it can be cut and hecne my comment on Neal's other thread on complexity. The challenge is that I think the cash sum required to deliver a container of toplights into the UK almost certainly requires more cash per subscriber than they would want coaches. As such, I've been thinking how such a business plan could be constructed. I don't suggest Neal amends his poll but one way of setting up the deal would be (and for illustration):

Initial funders subscribe £x per coach. Minimum take of [10] coaches. Option to sell some or all of coaches at £z (the final stage price).

Funders post CAD subscribe 1.1*£x. Minimum take [10] coaches. Option per above

Funders pre tooling subscribe 1.2*£x. Minimum take [5] coaches

Funders at pre production 1.25*£x. No minimum take and no option to sell down

Purchases/orders post commencement of production pay £z which is at least 1.3*£x

 

Each funding stake could be structured to pay in instalments up to the final preproduction stage. The concept is that those who take most risk get most benefit- ie cheapest coaches and the chance to make a modest profit selling to those who buy in later. I'd look to try and make the maths work such that the early stage guys were getting around a 10% return on their capital - ie appreciably better than in a bank account. When the day job allows, I'll model up what I think a financial proposal could look like.

 

One other way to get this to work might be for a manufacturer/commissioner to take the risk of getting a few CADs drawn up, a rough idea of the expected total costs and then ask for funding to take the project further. Would still likely need a minimum number of subscribers although conceptually such a party may have the appetite to underwrite a certain number of units.

 

David

[Clearwater]

APologies Neal for crashing your thread/poll.

 

To illustrate the pricing structure, I've outlined above I've put together a very simple back of the envelope type model to illustrate the concept. There's probably a few errors/simplifications and I've not tried to budget vs cost over time (ie does not take into account the requirement of the project to stay cash flow positive) and hence think about the valid point of how to structure installments.

 

For literally 10 mins work, I think it shows how you get a reasonable total chunk of cash, how early subscribers can make a reasonable turn on their money (and effectively 'benefit' through cheaper coaches. Ignores time value of money - very crudely16% is c5% pa for 3 years (an instalment scheme would raise the compound rate but leave the overall return constant). I think the stage 2 figures don't look fair but as I say this is a crude starter for 10.

 

Obviously I have no idea at all whether the subscriber figures are reasonable and whether the market as a whole would buy 4,600 coaches split across 3 diagrams and 3 liveries (900 per variant doesn't sound wholly implausible though). I've also approached very much from a model buyer perspective and I've probably not treated VAT properly etc etc. Question is does that scope/scale of budget give enough for a commissioner to take the plunge?

 

David

[The Fatadder]

Interesting idea, and one that I wish well.

 

While I dont have the free capital to go in at that sort of level, I would definitely be interested in buying a couple should it go ahead.  

[57xx]

Given the majority said they wanted to pay less than £50 would people really pay £70? That’s the test.....

 

 

I voted originally as <£50, in reality if the product were good enough I would probably pay up to £60. £70+ and I would be either not be buying any or reducing the number of units bought to meet budget. My budget certainly won't stretch to 14 units @ £70 each, or even £750 of stock, so this would be of no interest to me. I think you may have taken the sh*t stirring in the other thread a little too much to heart. The original poll was good and has provided usable data, some people just can't do the analysis.

Edited June 26, 2018 by 57xx

[88D]

I would be miffed if I forked out money on a crowd funding venture, only to find that Slaters had found a way to re-release their top light kits. So how about approaching them with this crowdfunding idea? Might be enough to push them back into the market.