davebuczek

Jacko, 100% agree as it happened to me also. That is why we may have audits done by an international audit firm to give more comfort to the investors. I am also having agreements that will hold me personally liable if the funds are not paid/returned. Yes, it is a personal guarantee and anyone could say that, but I have a more than reasonable salary being an ex-pat and I am able to pay if the company does not, but I do not expect (and hope) this will ever be the case as the company will have adequate cash flows.

Just a quick update for those interested parties: We opened for business a little over a month ago, but we changed directions and decided not to become a microfinance organization. Instead we are an auto-lombard (auto financing company) and we give loans that have a maximum of 30-40% of the cars liquidity price. We decided to only give auto loans, due to the easy process to repossess and to sell (and higher interest rates than with flats). Here in Georgia (country) when a payment is overdue the police are actually involved in locating the car and bringing it to you to sell in lieu of the loan. As of today we have given 20 loans with a total loan value of around USD 50,000. The average interest rate on the loans is 6.26% per month (Yes, per month, not year). Some auto lombards are offering 10%, but we wanted to get the money loaned out as soon as possible so we are offer lower rates (still very high) and a 2% commission fee. For those that invested, we have increased our guaranteed rate to 20% (but may be higher depending on how the company does). If anyone else is interested, please PM me. I know I will get the usual keyboard warriors say that I am full of BS, but I expect that and I don't really care. Speak to anyone who knows me and you will learn that I am dead serious.

Tombon has stayed there. Send him a PM. Think he likes the place.

It seems to be common practice among US embassies that it is easier if you have lived in the lady's country for a few years to get any kind of visa. I had the same experience as Lovedog (except the first time we went we were not married) when I was living in Russia (with my GF then later on wife). I did the whole process myself and it was not that difficult. If I remember correctly, it does make a difference regarding getting a green card for her, depending on how long you have been married, which visa you applied for, etc. I was married for less than 1 year, so her first green card was "temporary" we had to go back in 1 or 2 years for a follow up interview, then she got her permanent green card. That was a while ago, so maybe things have changed.

Pattaya Bay Resort is 1,070 per night for low season (includes b-fast). The used to have stay 6 nights get 1 night free, but not sure if the new management will do that.

I sort of agree with you. The point I was trying to make that my functional currency will be the USD (IAS 21 for you non accountants). This means that on my books I do not want to take significant risk of losing against the USD. This is only for my financial statements. For investors that deposit in Euro, they will be paid back in Euro and I will manage this in various ways mentioned in earlier posts so that I do not have any significant risk against the USD.

Sure this is true. I guess investing in General Motors or Enron wasn't risky? There is always risk (no matter where you invest and no matter what the OECD rating) and you shouldn't judge your decision solely based on that. And the main reason Georgia is 6 is due to the war with Russia (in my opinion). While there is risk that our "big brothers' will come again, I think it is doubtful as the government here has basically let the 2 regions go. For sure they don't like it, but nothing Georgia can really do. There are also other ratings you need to consider (transparency, ease of doing business, protection of the foreign investor). Georgia ranks very high and much higher than many of the countries listed above it in the OECD ratings. There is basically no corruption, so to consider your investment in Thailand or Russia (both rated 3) or Greece and Portugal (both rated 0) less risky than Georgia is not reasonable. I have also lived in Russia and it is one of the most corrupt places on earth, so the fact that it is a 3 on the OECD ratings and Georgia is 6 doesn't really say much to me. Also, didn't Greece just have a little default and screwed many investors? How can it's credit rating be 0? Georgia is committed to the democratic reforms and protecting investors, especially foreign investors. In the end it is up to each person to do his/her due diligence. Saying that this is a risky way for non-residents to invest could be said about any investment in any country and can be supported one way or another. Thanks for the wishes and I am confident (and hope) we will do well. We have a very good team in place and our first objective is to mitigate risk as much as possible before making any decisions. We feel this can be done and still earn very nice profits.

Rick, our functional currency will be the USD, not the Georgian Currency (Lari). The GEL is very liquid within Georgia and surrounding countries. I would only use derivatives to hedge (i.e as insurance to protect against currency risk). But, most of the deposits I get and loans given out will be in USD, GBP or EUR which are not illiquid (at least the last time I checked). If you would do some research you would see that many banks in Georgia have very good ratings and the largest bank (Bank of Georgia) is premium listed on the London Stock Exchange. Would that be some no name bank? There are also large banks from France (Societe Generale) and Germany (ProCreditBank) with good ratings that have been here many years. Also HSBC is here, ever heard of them? Please stop being so critical before you do a little research. Georgia is a very stable country, has democratic elections and has very low corruption (not dodgy as you say). Again I invite you to come and I will show you around and I think you will have a much different picture.

Sorry, not sure I understand what you mean. What I meant by "leaving that to the currency traders" was that I do not want to be in the business of trading currencies and taking currency risk. I am sure there are many people that are successful at doing that, but FOREX speculation is not something I am comfortable with. I want as little currency risk as possible and don't plan on having huge gains/losses on FOREX.

Yes, you can open the account in any currency you like. We would hedge this with loans given in £STL, purchasing option/future contracts, etc. as we don't want to be exposed to currency risk. I will leave that to the currency traders.

Have never been to Nigeria, but Georgian's are very trustworthy people and good people (I wouldn't have stayed so long if it was different). Yes Stalin was Georgian, so I guess all Georgians are like him? Out of all of the former Soviet countries, Georgia is far ahead of most (if not all) in regards to democracy, corruption (I mean low), business environment etc. Come for a visit, I will be happy to show you around and your views will be different.

Damn, I knew the support of a friend would get me in trouble some day. Don't really care for soccer, but put it up for a guy I met from Liverpool. Most know him as the best dancer on the FLB Board...

Actually the Georgian Lari (GEL) has been very strong the past 3 years. During 2011 it appreciated against the USD and other currencies (http://nbg.ge/?lng=eng). The investments can be in any currency you choose so there would be no currency risk to the investor, however we do not want currency risk and we will hedge this risk based on the deposits/loans received and loans given. Also most borrowers have a choice of what currency to borrow in. As I have said many times, happy to discuss in person when I am there next week or on the phone to give more details.

Gabor, you are still in Patts? will be there next Saturday, maybe will have a cruise again...will let you know...

Hmm...have you been here? I have lived/worked in many places in the world and there are far more "shitholes" than Georgia. By the way, the Habs blow. Go Wings....

Agree with what you have said about being able to get funds at a much lower rate, but you need to have the collateral to get loans here in Georgia. For now we only have the start up funds and are trying to offer high rates to increase the portfolio. Some of the MFO's here are offering even higher rates on deposits (up to 20%) but they tend to take more risk and charge higher rates to their clients even 5-6% per month. I never said this was riskless, most things aren't, but some are willing to take some risk to earn higher returns and as I said I can demonstrate a business plan that mitigates the risk. All loans will be backed by collateral that will be at least worth 2-3 times the value of the loan and most cases more, so if a loan goes bad, no losses will be made on repossessing the collateral. As I mentioned earlier, happy to speak on the phone or meet in person or send more information. Sure I can never prove this as riskless (no business can), but I can prove enough equity/collateral or other guarantees to justify money being invested. I will also continue working at my current job and would be happy to use that as part of the guarantee (providing it is not more than I could get approved for at a bank). Georgia's legal system is modeled after the US, so if you have an agreement and someone doesn't pay, you can garnish wages, repossess collateral, etc. If you don't believe me, write to DLA Piper an international law firm with offices all over the world and run by an American here in Georgia. In any rate, I won't keep posting here as it seems as if people think I am running some kind of scam or something and I don't need the sarcastic comments. If someone wants to know more, please pm me and I am happy to answer any questions. However, after we get up an running, I will post links to our website with our results and you will be able to see if I was full of it (as mentioned by many above) or I am serious.

Hooray to the above PM for posting what most of us are thinking? This presumes that Georgia is very unstable and very corrupt. Do some research and you will see that the opposite is true.

I will be in Patts between the April 7 and April 16th if anyone is serious about having a discussion. As many on this board know me, they know that I am not a troll or someone that would try to scam someone.

don't take my word for it. Do some research and see how profitable other microfinance companies are in many places in the work Think what you like. It is not too good to be true and if you like, we can have a call or meet up some time. If you do a little research then you will find what Micro finance companies are doing in other parts of the world. I gave you a link of 1 here in Georgia, did you bother to look? We can offer a high ROI as we can lend the money out at a much higher rate. As you are such an astute business man, you will know that a10-20% spread on deposits to loans is more than sufficient to be profitable. In the US most banks have spreads of 3-4% and do very well. How about 10-20%? Emerging markets have more risk, but there is more reward and as I have lived here for 3.5 years, had some of these types of businesses as clients, have contacts, etc. I know the market well and how to mitigate my risk. We have the initial funding, but additional funding is needed to increase the size of the portfolio.

Take a look at many microfinance companies around the world. They claim to help the poor and get them credit that they cannot normally get, but in reality they are chargining them through the nose some as much as 4-5% per month...thats per month, not year. Here is one link for a MFO in Georgia: http://www.geocredit...spx?language=en You will see rates like 30% or 36%, but the effective rates are actually higher due to fees, etc.

Backed by a government that just defaulted and screwed many bond-holders.

Not a bank, but a financial institution and is regulated by the National Bank of Georgia. The National Bank of Georgia requires quarterly reporting and financials to be posted on the company's website. There is also an annual audit requirement. There is no insurance here in Georgia (as in most emerging markets). The deposits received will be lent out at rates of 24% or higher and be 100% secured by real estate. The maximum loan that can be given out is around USD 30,000 (per law) and secured by apartments or other real estate that will have much higher value. The currency can be whatever you choose. We will actually be mitigating our currency risk by balancing the deposits we receive and the loans we give out. We don't want to be exposed to unexpected devaluations of a currency (or at least mitigate the risk). In the end, yes there is usually higher risk with higher reward, but as we will be investing a signficant amount of our own money, I would be very conservative. Also, I am a US CPA and I have many banks/financial institutions as clients, so that is why I feel that this can be a very successful business as the market is still developing and other companies are currently successful in the market. Happy to give more details if you PM me or even have a quick phone call. Some of the other guys on the board know me, so you can ask around about the type of person that I am and if I am a bull shitter or not.

Actually if you do a little research, Georgia is very stable at least compared to other countries in the region. There is almost no corruption (like in surrounding Azerbaijan, Armenia, Russia, etc) and they rank very highly in the ease of doing business rankings and transparency. During the financancial crises no banks collapsed here. How many countrires can say that? As usual, do your own research, but don't be so quick to judge Georgia as just another post soviet corrupt society. It is exactly the opposite. http://www.doingbusiness.org/rankings

Those returns would be guaranteed up front and the time scale to be negotiated. Obviously, like any other type of financial institution the longer the time frame the higher the rates. There would also be flexibility on early withdrawals as long as there was a few months notice (i.e. if a 1 year deposit was agreed, but the deposit was needed after 9 months). For this there would be no penalties on early withdrawals and 9 months worth of interest would be paid as we would have negotiated this up-front. Also, the interest would be net of taxes here in Georgia (country, not state), but the interest may be taxable in your home country. Also, equity ownership could be discussed and the returns may well be much higher, but this would be after a few years and paid out as cash flows would allow. We would prefer to let equity grow so the business can grow, but this is also open to negiotiation based on each person/company's circumstances and/or goals.

Anyone interested in earning 10-15% on deposits, please PM me. If interested I will give more details of our business model, etc. Please serious inquiries only. Thanks.