Annual contracts are cool, but what if you could bundle and sell cohorts of your subscriptions for their risk-adjusted lifetime value? HT @mike_seekwell
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This might need some unpacking for technologists who haven’t geeked out an asset back securities yet: In the simple model, cash flow from customers flows into a pool, and then the pool flows to investors equally. In the tranched model, in every periods cash flows to N pools.
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First you fill up the pool which is safest (and pays lowest interest), then the next safest, etc etc until you get to the last, riskiest pool. By convention that pool is called the equity. If you math this out, it takes losses caused by e.g. churn first.
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Ah, so it’d be like debt that pays a coupon representing a fraction of the cohort’s revenue?
I’m going to have to let that ferment for a while. 
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It functions a lot like mortgage securitization, and would have a very, very similar pitch to potential investors (minus the federal guarantee).
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Is there a securitized industry where this has been done? Seems it wasn't done for mortgage originators during the subprime boom, and I can't find any other references.
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