How Revenue is Shared

Work in progress image

Note: This section is critical and will be a work in progress for some time. I need a lot more input from a lot more people. I could spend time better served elsewhere, wrapping my brain around different solutions, only to suffer rejection when it comes time to vote. Bearing this in mind, below are my preliminary thoughts on this subject.

By now, many of you have imagined different ways of earning a piece of the action. What you could not have imagined, is how revenue sharing is in a league of its own. Revenue is shared, in the form of residual payments, with contributors whose projects make everything happen. Contributors do not have to be involved in a project from the beginning. They do have to be instrumental to its success in the end. Web designers, writers, editors, artists, these are examples of those deserving their cut.

Projects can be improved with updates, corrections, rewrites, anything imaginable. Unsuccessful projects that never get off the ground could simply lack the right visionary to get involved and change everything.

Residual Payments

As long as a project or contribution generates revenue, residuals are paid for a period of ten years. After this period, ownership rights to the project are transferred to UpgradeMyDream and contributors to that project are no longer compensated. This does not affect their other projects generating residuals, or newer ones they have in the pipeline.

In the section Investing, Exchanges, Futures, and Wall Street, I briefly touched upon selling or trading residuals. Be forewarned: Just as the prices of stocks and bonds go up and down, residuals are likely to do the same. Members selling residuals could come to regret it. On the other hand, members might build a project just to sell future rights to it. In the end, who can say which approach will be best?

Formulas for Residual Payments

Our dreams for the future only work if people are compensated fairly. This transcends everything and creating formulas for residuals, wages, fees, and all things considered, is going to take cooperation and patience. Changes will be needed to keep us all satisfied. Whether rewards go up, down, or sideways, will be determined by time, experience, and a lot of constructive feedback. The world is full of solutions and together we can find them.

Projects can grow to a size the original team cannot handle. When a team is overwhelmed, or no longer involved, new people can appear and make necessary improvements. Other notable changes will come from new specialists, new ideas, or the need for someone to take up the slack. Of course these members need to be rewarded, determined, in part, by the tiered pay structure below.

Tiered Pay Structure

Many projects must be constantly updated or they run into danger of being replaced by something better. However, assuming a project remains in use, a tiered pay structure is one approach for determining residuals.

Core projects begin everything, and they are called Tier 1 projects. Tier 1 projects run by themselves, and may or may not have other tier projects linked to them. Tier 1 projects are often joined, in time, by additional projects improving functionality. Upgrades and revisions are Tier 2 projects. Tier 2 projects are dependent on Tier 1 being stable, in use for a while, and classified "complete". (Web development projects are further classified as "bug-free".)

Tiers 1 - 3 in detail.

  • Tier 1 is an original core project, and contributors collect 100% of their share. As long as their work is unchanged, they retain 100%. If another tier is added, the share for Tier 1 drops to 70%.

  • Tier 2 increases the revenue generated by Tier 1 through additions and improvements. However, those in Tier 1 must agree to these improvements. If Tier 1 agrees, Tier 2 contributors receive a 30% share, also for ten years. Tier 1 members still receive 70% of their share, up to the time their ten year contract expires. Tier 1 members may also be involved in Tier 2. In this case, like all Tier 2 members they receive a 30% share for another ten years.

    While Tier 2 receives a smaller percentage than Tier 1, the rewards are instant if Tier 1 is generating revenue. It should also be noted: Even if Tier 1 is enjoyed by regular users, in the long run, Tier 2 can overshadow Tier 1.

  • Tier 3 is the lowest tier. It adds minor functionality to Tier 1 or 2. Tier 3 may or may not receive residuals and may or may not consist of mostly trainees. Tier 3 could consist of Tier 1 members, wanting to update their project further, or it could consist of those wanting to prove their worth and capabilities. For now, I leave Tier 3 as a mystery and someone else to solve it.

Shares paid to different tiers follow the table below.

Tier structure table
Tier 1 Tier 2 Tier 3
100% NA NA
70% 30% NA
60%? 30%? 10%?

Alternate Pay Structures

An alternate pay structure places everyone in a class. The class they belong to determines their earnings. There are many ways of classifying pay scales already accepted in business and society the world over. It should be relatively simple to copy something already in place. E.g., Law firms depend on partnership levels, militaries depends on rank.

A final approach splits earnings equally within each department. This would be simple to implement, but for obvious reasons, it would be worse for those who deserve the most credit and the greatest rewards.

Additional Consideration for Payment

Most departments generate their own revenue. Departments for advertisers, writers, artists, and bankers, are a few examples.

The Web Development Department is the one department that receives revenue from everyone. The reason is website development benefits all of us and there is no future without it. More profitable departments will need one or more web developers working for them full time, each entitled to their share. See: Website Development.

Some departments are dealt with differently because we cannot function without them. Aside from their normal earnings, these departments also receive payments coming straight from company profits. These payments can be split between departments, using something like the incomplete table below. There will be other departments added, and for now the figures seem pretty useless. Nevertheless, this table is used to begin the conversation. Like everything else it is far from complete.

Percentages of company profits split between departments
Department Percentage
Company 25%
Programming 25%, or residuals from projects (To be decided)
Legal Department 5%
Accounting 10%
Research 3%
Server 3%
Security 5%
Search engine optimization (SEO) 3%

Those working in the departments above, and other areas of this website, could easily be paid standard fees for their services. However, paying a percentage motivates people in ways I won't go into. Suffice to say, some might drop everything they are doing and give us their undivided attention.

This page needs a lot more detail and thought. It also needs an agreement before we can really get started.

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