Republic Note has launched on Republic, seeking a minimum raise of $360,000 and up to $2.02 million. The price per digital security is $0.36 with a minimum investment of $100 and a maximum amount of $60,0000. The security is being issued under Reg CF.
As it stands currently, 524 investors have committed $490,815 – easily topping the minimum hurdle. The deadline for the offering has been set at the end of the month on April 30th.
According to the White Paper, the Republic Note has been “engineered to empower Republic community members to share in the financial upside of its portfolio of companies—and to be rewarded for their engagement with, and contributions to, the Republic ecosystem. Made possible by a meticulous combination of strategic, blockchain, and legal engineering, the Republic Note aims to serve as the connective tissue of the Republic ecosystem for many years to come.”
Each Republic Note is a unit of Class B limited liability company membership interests in a digital form issued by Republic Core LLC. The digital asset represents a revenue share of capital gains generated by the platform. As explained, Republic Retail sends 100% of its realized upside to Republic Core, while Republic Capital sends 25% of its upside profit to Republic Core. These “Core Proceeds” accrue in a pool that will eventually get distributed as dividends to Republic Note holders.
While subject to change, Republic Note holders are currently expected to receive distributions from the dividend pool each time it reaches a threshold amount of $2 million. A dividend distribution will occur net of administrative fees, currently capped at $35,000 per distribution event.
Republic provides some test cases to share examples of a hypothetical return to Note holders. Future funding rounds of Republic Note are planned, and the delivery date of the assets for this round is expected to take place later in Q2 2023. There are also some community benefits offered which may be of interest to some investors.
A successful investment in Republic Note is predicated on the ability of issuers generating a good exit in an asset class that typically needs an extended runway to drive postitive returns. At the same time, Republic states that its intention is for Republic Note to list on leading national and international exchanges but for the time being, investors should plan on holding these assets for a long time.
Republic envisions a future when just about any asset can or will be tokenized, and they are at the beginning of this transition.
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