Radical investments are more like an Angel investment or a real estate investment. Actually, it could be both. For sure, they are not at all like Venture Capital investments.

Here is a sketch of each…

Venture Capital Investments

A Venture Capital (VC) investment triggers an ownership transfer.^∇ The business now has to issue shares of stock so they can give a forever percentage of stock to the VC investor in exchange for their capital. If the amount of investment is big enough, VC investors also expect a seat on the Board which gives them control over the business. Although they usually defer to the execs, they can always fire them and hire somebody more, say, amenable to their wishes.

In my experience, they contribute almost nothing to the success of the business other than their capital. Their advice is hard to come by and, in fairness, they don't have the expertise or the bandwidth to give you more than banal advise.

Angel Investments

An Angel investment does not trigger an ownership transfer.

Angel investors exchange their capital for a promissory note. The note usually spells out the maximum return that Angels could expect. There are no stocks and they do not get a seat on the Board because there isn’t one. Besides their capital, their advice is also very valuable as they can help with raising further capital, give business and industry advice, etc.

In general, when they offer advice it is to improve the chances of success of their investments.

Real Estate Investments

A real estate investment does not trigger an ownership transfer, either.

Real estate investors exchange their capital for an annuity. They receive their return as a percentage of their investment on a recurring basis. Normally, this return goes on for the life of the investor, but it may also survive the death of the original investor.

BTW, I am not sure if this applies to all types of real estate investments, but it applies to hotels and other real estate ventures.

Radical Investments

A Radical investment does not trigger an ownership transfer. Radical investors do not seek control of the companies they invest in, nor are they looking for a “forever” return.

Like the Angel investment, a Radical Investments exchanges capital for a promissory note. Like a real estate investment, the return may come as an annuity. A big difference to other forms of investment, is that a Radical investor can also participate in giving and receiving RADs. Investors can,

• Work with their portfolio companies,
• Help them improve their chances of success, and
• Do all this while getting paid for doing so.

These contributions would be recognized, turned into RADs, and, finally, into earned dividends (i.e., cash).

ENDNOTES

• According to Blair Fix, Nitzan and Bichler argue that ownership is a negative social relation: it is the institutional right to exclude. Unemployment and the Maturity of Capitalism. May 06, 2023. Economics from the Top Down. <https://…>