Is It Safe To Invest In Solara?
Solara is a company that specializes in acquiring, capitalizing and operating, innovative new Technology companies. Although Solara endeavors through its extensive and rigorous Due Diligence process, to ensure that both the Technology and the underlying business model supporting the Technology's commercialization are sound, the very act of taking a new company from the completed development stage of its Technology and fully commercializing it, has inherent risks. The question then becomes, is the potentially escalated amount of return, worth the elevated risk of a Solara investment?
What kind of ROI can I expect from a Solara investment?
That will ultimately depend upon the Solara investment (which subsidiary Solara company) that you invest in. But, each Solara investment is designed to always pay first, those who invested in it. Solara uses a Fractal Income to pay its Investors. Typically, the Fractal Income will be derived from 5% of the gross revenue of the subsidiary and distributed on a pro-rata basis, amongst the unit holders entitled to the Fractal Income. Fractal Income is collected from the gross revenue of the subsidiary's income, before any other expenses are paid. It is held in a separate account from the company's operating funds (not commingled) and paid quarterly from that account to the shareholders of the subsidiary.
If 1,000 Solara Members, each bought a $5,000 Security Unit, comprised of 1,000 Limited Partnership Units, each Security Unit paying a Fractal Income, that would raise $5,000,000 for the acquisition and commercialization of a new subsidiary company. If the SubCo, when launched, then produced a gross revenue of $500,000 a month ($6,000,000 a year), each Member Investor would receive $300/year in Fractal Income, paid quarterly. The $300 in Fractal Income, provides a 6% annualized ROI on the original $5,000 invested by the Member. That is a 2 to 5 times higher ROI, than the average GIC deposited, TFSA account would pay. **NB Please be advised, Solara is making no claim that each, or any subsidiary will gross $6,000,000 in any year's sales, but that this figure is used for what would be considered by most reasonable people, to be an acceptable amount for an example of this nature.
Who runs Solara and what are their backgrounds?
The Principal shareholders of Solara are veteran business people, each with exceptional backgrounds in the creation, marketing, financing and operations of private and public corporations. Their primary skills and experience include reporting and dealing with Security Regulators in the public arena. Solara's Principals have unique skill sets in the use, description and revitalization of Intellectual Property, within the financial reporting processes of Securities Law. Solara also has expertise in bridge financing, arranging of long term debt and equity financing.
Can I really invest from my TFSA and not pay taxes on the money I get as a return?
Yes. Canadians have been able to invest in a Tax Free Savings Account since 2009. The premise behind these accounts is to stimulate the economy by affording Canadians an opportunity to invest in somewhat higher risk ventures and offset the risk by not paying any tax on the returns received within the account. With additional risk should come additional benefit (higher returns) and with that would come the additional benefit of paying no tax when withdrawing from the account.
The current practice of most Canadian Investors, of placing their TFSA account in GICs with institutional financial companies, is diametrically opposed to the intent of the TFSA program. There is virtually no risk to this type of investment, but there is also certainly no stimulation of the economy as a whole nor of the Technology sector specifically and the returns to the Investors are almost non-existent.