The Distressed Debt Investors Club is currently in development. My developers have the back end largely completed, with the front end being worked on next. I am hoping a beta launch will occur at the end of September. I am still working out a number of debatable issues; some that readers have proposed and others that inherently arose from developing a site from the ground up. With that being said, the objective is still the same: To foster a strong community where high-quality investors can share / vet out investment ideas. This community will be high caliber. I promise you that. Now on to some FAQ.
When can I send you my application for the DDIC ? - Right now, we are working on a system to have all the applications go directly through the website. If that doesn't pan out, I will set up a unique email address where you can send them. The beta test for the site will last probably 1 month. That being said, I will take applications for beta sometime in mid-late September, and applications for full-blown membership in October, once all the kinks have been worked out.
Who can apply ? - Theoretically anyone can apply. That being said, I am limiting the number of members to 250 for at least the first year. There will be an unlimited number of guest spots that will have a 50 day delay to the database.
How will you evaluate the application ? - On a few criteria really. While the site is completely anonymous, when you apply, you will have to provide your real name to me, and the number of years you worked in the industry (buy-side or sell side). This information will be kept solely by me and will not be released. I do not want to discriminate against MBA students or recent graduates, but tenure and quality of investing experience will be weighed in the application. Outside of that, it really is going to come down to your write-up, which I will discuss in great detail next week.
Do the ideas on the site have to be distressed related? - Not distressed related specifically. The site will have a number of categories: Distressed, Stressed, High Yield, Investment Grade, Post-Reorg Equity, Liquidation (for the Greenbackd in you), Special Situation, Other (Credit Related), Other (Equity Related). As you can see, undervalued/overvalued equities do not really impress me and unfortunately that is not what this site is about. This site is specifically geared to what I have written about on this blog and to investors that follow it. While members will be able to contribute equity related ideas, they will not count to the annual requirements and probably should not be submitted for the application process.
Tell me a little bit more about the guest access? - Guests will be able to read the database on a 50 day delay, similar in nature to VIC. They will not be able to comment on investment ideas, but will be able to read the comments in full.
Will you continue with the blog after DDIC is launched? - Yes. Absolutely. In fact, each month, I will take a particular write up (with the member's permission) and post it on the blog.
Why are you making it anonymous? What if I want to network with the investors on the site? - I run this blog anonymously. I would never ask someone to reveal their identity/background to the general public. For networking, there will be a messenging system for Members (makes my life a lot easier as administrator) that will fascilitate offline conversations.
Will the DDIC membership cost anything? In all honesty, I have struggled with this one. Sadly, I am not Joel Greenblatt or Divya Narendra (first here, then look up the story of ConnectU), so I am going to have to charge a nominal amount to cover future development, maintenance, and site fees. This will amount to somewhere less than $40/year if I have done my math right. That equates to 5 beers in Manhattan (4 Red Bull vodkas to all you investment banking analysts) which I think is well worth the sacrifice. Guests will also be asked to contribute a nominal amount annually - nothing required though. I will not collect any $$ until January to give members / guests the time to opt out in the small chance the site fails miserably.
Why only 250 members? There are a few reasons for this, but the main one is that I believe a number of the situations that will be proposed on the site will have minimal liquidity. I have seen in the past few months a number of VIC ideas that have just taken off because everyone was bid-without. Secondly, I want to keep the quality of members and ideas at the highest level and do not want to dilute the offering with a barrage of ideas that are merely presented to pump a stock/bond price. Member will only be required to post 2 ideas on the topics I mentioned above a year. If it works out the way I hope, member will post more than that and comment significantly more, so there should be a constant stream of information. One idea will be in the first half of the year and the second in the second half (or two in the first half)...I have never liked that so many people throw up ideas at the same time when annual requirement are just being met.
Will members be able to offer suggestions / make changes to the siet? Yes. While I might seem like a dictator now, once the site gets up and running, any major change will be proposed to the members for commenting / discussion (in tandem with the site will be an internal forum where users can talk about whatever they please). New ideas can be suggested and assuming my developers can make the change, we will be fluid and hopefully, constantly improving.
I am very excited of everything that is going on and I want to thank the twenty or so of you that sent me comment / suggestions on what would make the site better. If you have any questions or further comments, please email me at hunter [at] distressed-debt-investing.com.