Being as Equity: Founder and Investor Equity as Finite Issuance towards Self and Others
Balance Sheet Existentialism, Part 3
tldr;
1. Being (in the early-Modern, existential sense) is to be understood as equity since, firstly, it is defined only through the finite issuance of its ownership, and secondly, its receipt by both itself and others.
2. The existential being appears as already enmeshed within a complex social reality, to be understood only in its ‘thrown-ness (geworfenheit)’ in the authentic acknowledgement of our ‘being-towards-death (sein-zum-tode)’, in other words, the act of finite issuance of its ownership or equity.
3. This finite issuance of ownership is directed first towards the self (Founder equity) as our ‘being-in-the-world (dasein)’, and subsequently towards others (Investor equity) as our ‘being-with-others (mitsein)’.
Introduction: Being as Equity
What is being? While we had allocated the body under Assets, and the soul under Liabilities, it appears as though we had already exhausted both terms in the traditional Cartesian duality for which we commonly structure our understanding of existence. This, however, proves to be incomplete. In addition to the body and the soul, there is another dimension from which we ought to understand human existence: being. As radical opposition against the ‘bloodless philosophy’ of rationalism, Being (or more specifically in this case, Heidegger’s concept of dasein/being-in-the-world), sought to bring the focus of existential studies back to us as viscerally communal beings. Rather than logically deducing the body/soul or object/subject dichotomies in logical isolation, dasein is always and only defined in relation to the world around us; that it is only proper and relevant to attempt to understand ourselves - already enmeshed within the complex social reality we live in.
What has being got to do with equity? Simply put, being is the finite issuance of equity to self and others. What is equity? Equity, in BS terms, is the final portion of the A=L+E triadic, where it sits on the same side of the equation of liabilities. While liabilities take on debt-like characteristics whereby you essentially hold IOUs to be returned eventually at time of maturity, equity is not about borrowing but owning of the entity. How this ownership is allocated: through the finite issuance of equity, to ourselves, and then to others.
Being as Finite Issuance of Equity
In the same way we distribute equity to shareholders such as ourselves (the founder) and subsequently, angel investors, venture capitalists, and institutional investors, we similarly proceed through our lives existentially enmeshed in a complex social reality whereby we find ourselves distributing parts of our being to other beings we encounter in the world.
Why is being to be understood as ‘issued’ and ‘finite’? According to Heidegger, since we no longer follow traditional rationalism of existence conceived in pure static isolation, we rather find ourselves ‘thrown’ (geworfenheit) into this social reality. This thrown-ness can be understood as directional, upon ourselves and the rest of the world; this is not dissimilar to the issuance of equity, being directional upon us as founders before other shareholders that acquire equity eventually.
What is interesting is the understand that this issuance is of something that is ‘finite’. When equity is first issued, a stated amount is chosen, be it 10 shares or 1,000,000 shares, a stated price per share fixed, and then they are distributed to respective shareholders. Similarly, Heidegger contends that the immediacy of recognizing our ‘thrown-ness’ puts us in particular moods, the most authentic mood of which is when we recognize our death or finite, as ‘being-towards-death (sein-zum-tode)’. Only in recognizing that our value is to be understood in finite terms (although it can keep growing within that limit, the way shares increase or decrease in price per share, or in no. of shares outstanding), can we allow ourselves to live authentically/meaningfully.
Issuance of Equity Towards Self and Others
Now that we have established that being is simply understood as the finite issuance of equity, we need to resolve the nature of such finite issuance it towards Self and Others. Dasein, as the recognition of our ‘being-in-the-world’, is an existential orientation to define ourselves amidst the complex social reality. Although the world is complicated and taken as ‘already there’, the immediacy of our understanding of the world can only begins with us first. In the same way, therefore, for an entity to be formed, it has to be incorporated with shares outstanding decided - after which it is distributed first to that who founded it in the first place, the founder. Equity is not a priori, but has to be issuance by the founder, to the founder (100% first). This seemingly redundant step is important because it indicates directionality - once again, that our existence is not to be taken as a ‘state’ but a ‘thrown-ness’.
Once we understand this act of issuance to the self, we can start to consider the ontological characteristic of our being-with-others (mitsein). No being can exist alone within a social reality, but necessarily engages in transactions involving the self with other beings. More often than not these transactions involve a particular negotiated exchange of ourselves, (or in common terms, giving a part of oneself), in return for a value that we would like to recognize as an asset to us - similar to equity sale to external investors who take an interest in our life’s work. These transactions are multifarious: be it time (equity) spend with a loved one to create memories (asset) together, or effort (equity) dedicated to a team to create a project (asset) that is of value to the world - they occur all the time around us and it would be prudent to take note of the equity issuances we may be consciously/subconsciously allocating to the people around us.
Unfinished Notes
An interesting point that I had not yet expounded is the seeming contradiction that exists in the finite issuance of equity, and yet the infinite scalability of its amount/value. For instance, if an entity has 10 shares outstanding at $1 per share, the value of this company is simply 10*$1=$10. This 10 shares issued is finite at this point in time, but there are 2 variables that makes equity attractive as an asset class. Firstly, the amount of shares can always be adjusted. For instance, while keeping the entity’s value at $10, the entity can issue 10 more shares, causes the total shares outstanding to be 10+10=20, decreasing the price per share to $0.50. Secondly, the entity’s value is always changing by appraisal. For instance, in year 1 the entity may be valued at $10, but as the company’s business lines grow, in year 2 it may be valued at $15, changing the price per share accordingly. These two infinitely scalable variables (tentatively I will refer to as ‘infinite subdivision’ and ‘infinite upside’) are fascinating characteristics worth investigating as they exist precisely only because of the limits that finite issuance imposes.