Frequently Asked Questions
When does LOVE TO start?
We are planning to launch two Mutuals in June 2021, LOVE TO Be Fit and LOVE TO Be Bright Green. Other Mutuals will follow.
How do you know what personal beneficial effort I have invested?
We ask you to make a claim using our app. There is no cost to making a claim. Then we verify the claim and provide you with a certificate of value for the effort you have made.
The Mutual offers to buy your certificates from you and will pay you for those certificates in LifeShares that it issues.
What is a LifeShare™
You will get paid for your certificate by swapping it for a number of LifeShares determined by the amount of verified assets you have generated. We explain more about verification below. So if you have $3000 worth of verified personal beneficial effort after we have verified it, you will be allocated 30 shares, each of which has a $100 face value. This is the “wholesale” price of the shares. When they are listed on the stock exchange they may go up or down, like any other share.
How can I sell LifeShares?
Once they are listed on a stock exchange you will be able to sell the shares you own, using a normal stockbroker.
Are there any conditions on selling LifeShares?
We are planning on developing an escrow system that requires the LifeShares gained for effort during the preceding 12 months to be held under escrow for 12 months. The escrow will be released when effort for the current period can be shown to have been (at least) sustained.
We will have some exceptions that allow smoothing to allow for difficult short-term situations like acute personal injures for the Be Fit Mutual, or drought/fire/flood impacts for ecological Mutuals.
(If you have a multi-year claim for ecological effort, only the most recent year’s improvement will be escrowed. This is calculated by averaging the shares issued over the years claimed.)
Upon the advice of our brokers we may implement an escrow that manages the flow of shares to market and will affect how quickly you can sell LifeShares. This is to prevent everyone missing out by having too many shares for sale at once.
You will still own your shares and they will still earn their dividends, even under escrow. You may be able to sell them off-market as well, and LOVE TO will be looking to create these opportunities to benefit our Mutual Members as much as we can.
What is Verification?
The process we use starts with a claim made by you, your club or organisation. We look at that claim and find the data that supports it. It is a way of proving to the investors who buy the LifeShares that the asset you made is real.
In LOVE TO Be Fit right now we have two verification levels:
Silver level is awarded for support by existing records from third parties. It relies on the claimant making a true and witnessed claim, and then their club or organisation must have data to support the claim you have made, such as participant registration records, times, awards, team photos and the like.
Gold standard verification includes all the silver level requirements, plus additional data that is generated in real time when the activity is happening. For example, in LOVE TO Be Fit Mutual this could include data from wearable devices.
In LOVE TO Be Bright Green we determine a verification percentage by multiplying the methodology error by the data quality measure. For example if you use a methodology with an error of 80% and data source with a measurement error of 95%, your verification score would be 76%
The higher the Verification level reached, the more LifeShares you will be allocated for the same amount of effort.
Can my family participate?
Yes, your children can own shares if they are also creating Personal Beneficial Effort, eg by playing club sport or volunteering.
If it’s an Australian Mutual, will that mean I can’t join in if I live in another country?
You can join an Australian Mutual from any country in the world, as long as your laws allow it.
What if I can’t verify my activity?
If you’re unable to verify past activity, there’s little we can do about that. But you can verify future activity by using our recommended methods, such as wearables.
Will I have to pay tax on my shares?
Everyone’s tax situation is different, so we are currently preparing an accountant’s advice paper. Usually, you won’t have to pay tax when you receive the shares and you will most likely pay regular income tax in your place of tax-residence when you sell them.
How do you measure the benefit generated by people’s activity?
We use widely recognised and scientifically validated assessment systems for measuring benefit. Accounting For Nature is the system we use for ecological improvement.
QALYs and DALYs are the systems we use for human health and wellbeing. There are a lot of scientific papers about QALYs and DALYs but wikipedia is a good place to start exploring how they work.
(for Be Fit Mutual) How do you verify the activity exists and is sustainable?
We use several levels of verification, best suited to the activities. The simplest (and weakest) level is personal witnessing, where another person verifies that they witnessed your activity. Mid-strength verification comes from external organisation records, such as club or event attendance. The highest level of verification uses technology, such as wearables.
(for Be Fit Mutual) How do you determine the financial value of the benefits?
Each country establishes its own QALY and these aren’t always published.
For LOVE TO Be Fit Mutual, an independent expert provides a report that supports our assessment of the “willingness to pay” for a QALY, which is different in each place that people live and work. All participants are treated equally without discrimination based on race or nationality.
(for Be Bright Green Mutual) How do you determine the financial value of the benefits?
For ecosystems, we have developed our own algorithm for determining the value of improvements that is based on the ecosystem improvements made and the priority of those improvements.
(for Be Fit Mutual) How much money can I make?
This depends on what your beneficial activity is, how long you’ve been doing it, what quality of verification is available and what its value is.
Typically, if you play sport and exercise throughout the year, we estimate that is worth approximately 10% of one QALY, which at the moment we expect to be around $5000 for people in Australia, New Zealand, most of Europe and the US. You will receive around 52% of that as saleable shares and another approximately 17% as shares that you invest into the Mutual’s Dividend fund.
This is subject to change, because we will only know how the market will respond to our valuation once the first tranche of shares is listed.
Why are you using Mutual Companies?
Mutual companies are a very traditional structure that are designed to last a long time and be very stable. The biggest advantage is that they are owned by their members, not by shareholders. This means they can’t be manipulated or controlled by a few people at the expense of many.
How many people does it take to make a Mutual?
It depends on the value of the assets that are being generated by members of the Mutual. A large farm can generate a huge asset, so we will need fewer farmers to create sufficient value to become investable than in the case of health and wellbeing activities.
Why are these activities investable, when this hasn’t been possible in the past?
Presently there is a significant demand for investments that are focused on improving ecological and social conditions. This demand comes from institutional investors who have been mandated by their governments or their corporate clients to invest in projects that demonstrate and verifiably prove outcomes like mitigation or adaptation to climate change, or to positive social impacts.
Estimates of investable funds required to meet commitments of signatory nations to the Paris Climate Accord are approximately US$1 trillion per annum and this scale of investment would be required every year for about 20 years. So far in the first four years of the Accord the volume of funds is gradually increasing but presently sits at about 12% of the annual target, so as well as a need to rapidly expand actual investments made into the sector, there is almost $3.3 trillion of catching up to be done and a limited time frame in which to do it.
Other estimates indicate a requirement of about US$3.5 trillion per annum to be invested into projects that support the UN Sustainable Development Goals (SDGs). Again the actual amount invested to date is circa 12% of the target over the last 3 years.
How do you allocate the LifeShares?
These allocations are approximate and may change when we appoint a Financial Partner.
69% goes to the person who generated the Personal Beneficial Effort (52% saleable and 17% invested)
10% saleable plus 3.3% invested goes to the Asset Manager. The Asset Manager manages all the share issues, listing arrangements and invests the Dividend Fund on behalf of Mutual members.
The rest goes to the various organisations that help make this possible, including clubs and associations, business partners, key distributors and others.
The invested components mentioned above total 25% and are invested in the Dividend Fund (which belongs to all members of the relevant Mutual)
What does the Dividend Fund do?
The Dividend Fund sells the 25% of the total issuance of LifeShares to investors to create a market, and uses the cash returned to invest into projects that produce more good in the world and also increase the value of the fund. The returns we achieve from investing are the profits of the Mutual and this allows us to pay dividends on every LifeShare issued and grow the Mutual at the same time.
What is the value of the dividend?
We are allocating US$2 per LifeShare. One LifeShare has a face value of US$100.
What Mutuals will there be?
In the long-term we expect there to be Mutuals for just about any beneficial activity you can imagine. To begin with, check our website to find out the most up-to-date information.
Will it be possible to belong to more than one Mutual?
Yes, as long as each Mutual is recognising and rewarding different beneficial activity.
What can I do to prepare for joining a LOVE TO Mutual?
Start by joining our free webinar, The Future of US. This will help you understand LOVE TO and keep you in the loop as we develop.
How do Business Partners make their money from LifeShares?
When your customers or members receive LifeShares because of the Personal Beneficial Activity they have generated, your organisation will receive a small percentage of every share issued. If you have many members, this could be a significant additional revenue stream every year.
Are there other ways to partner with LOVE TO?
LOVE TO will work with Business Partners that can offer our members beneficial products that contribute further to the asset being generated (eg health and wellbeing or ecological improvement). You will receive a share of this asset for your contribution to the creation of it.
(for Bright Green Mutual) What’s a retrospective claim?
If people have been doing beneficial activities for many years and they can be verified, we may be able to turn the value of those activities into an asset and issue shares for retrospective activity. This means that an individual’s first claim may be much larger than subsequent, annual claims.
As a Business Partner who is able to verify those claims, you will receive a percentage of the asset.
(for Be Fit Mutual) How much money can my business make?
This depends on what your beneficial activity is, how long your customers have been doing it, what quality of verification is available and what its value is. Typically, if you organise sport and exercise throughout the year, that’s worth 10% of one QALY per participant, which is around $5000. Your members will receive around 69% of that and your organisation will receive a small percentage on every share.
(All numbers are approximate and subject to change)
How can we sell our LifeShares?
Once they are listed on a stock exchange you will be able to sell them (subject to conditions outlined in the escrow section above). We may need to manage the speed at which you can sell shares initially, to prevent a rush on the market.
What if we can’t verify the activity of our members?
If you’re unable to verify past activity, there’s little we can do about that. But you can verify future activity by using our recommended methods, such as good record-keeping and wearables.