Tyler Tringas details the quarterly subscription parameters and accessibility thresholds for Earnest Capital LPs.
Disclosure
Tringas: Earnest Capital blocks arbitrary prepayments but guarantees formulaic buy-downs
“The founders are allowed to make that payment. They're not allowed to prepay in the sense of just dumping money at us. So what they can't do is just say, here's a check, 300 grand, boom, like we bought you down, right? And again, the reason for that is let's s…”
Prediction Not checkable as stated
Tringas: New software deployment age favors niche products over mega-companies
“It's not the case that You know, a handful of software companies are going to scoop up all of the opportunity. What we're seeing and something that I've written about is, is this new deployment age of software.”
Insight
Tringas: VC feedback is mostly optimized to make founders go away
“Don't ever listen to the feedback that VCs give you. It's mostly optimized for you to just leave them alone and refer other people to them. It's not real advice. Like mostly don't take it.”
Insight
Tringas: Traditional convertible notes and SAFEs fail profitable, non-fundraising startups
“Most of the early stage instruments, convertible notes and safes really are orientated around the idea that you will raise another round. And if you don't raise another round, They either do stuff that's, you know, not great, like accumulate interest indefinit…”
Disclosure
Tringas: Earnest Capital equity is typically reducible by up to two-thirds
“It's usually reducible by two thirds. So, so if we had written a check that entitled us to say nine percent of ConvertKit, you know, Nathan absolutely would have, you know, paid us down to about three percent and we would be very happy to still have that three…”
Prediction Open · timeframe Jul 2025
Tringas: Shared earnings instruments will eventually qualify for capital gains treatment
“And so we do believe that, you know, over time this will continue to be categorized more and more as equity risk, which the tax code tends to reward with capital gains treatment.”