Chapter 427 - Fundraising
Chapter 427 Fundraising
Claude really had no other way. His money was being spent like water. As an honorary viscount of the kingdom, his yearly stipend and other related bonuses amounted to around 400 crowns. All the generals in the theatre, Bolonik included, were lieutenant-generals, but their salaries were only half of his. Bolonik wasn’t an honorary noble, so he didn’t have the extra 200 crowns Claude’s Title provided him with.
However, Kefnie was the one who dealt with the salary, stipend, bonuses and the rest. Claude’s necessities were provided for free by the military and there were few instances when he’d truly need money. But it wasn’t because his wife was the one who managed all household finances, but rather because he earned way more in the way of the other stuff than his salary. For instance, his victories in the three colonial wars with Thundercrash saw him earn up to nearly two thousand crowns in spoils. Those were all deposited into his national bank account which he managed himself.
Additionally, the 35 thousand plus crowns’ worth of Shiksan wealth and the profits he had made from the sale of mortars and revolvers hadn’t been accounted for. There was also a large ten-thousand-crown dividend from Borkal’s company. Basically, Claude had more than 500 thousand crowns at his disposal.
Despite that, he spent money rather frivolously as well. Buying the farmstead for his sister and setting up the lab there cost about 20 thousand crowns, and that was the smaller part of the equation. Most of the spending went into the tens of thousands of crowns spent on good lab equipment and materials for Sonia and Angelina to use. If they didn’t have those funds to play around with, even with Claude’s direction, Sonia wouldn’t have been able to create a new rifle within two short years.
Additionally, he also adopted more than 160 orphans for the Ferd household and ran a small elementary and middle school in the farmstead with the intent of developing talent for the house. That cost him quite a sum annually at around 10 thousand crowns. The necessities of the orphans weren’t an issue; it was the tutors that cost a lot to hire as well as the expensive learning materials.
Claude also teamed up with Weyblon to start the refinery, owning up to a third of the shares. The first batch of ores to be processed would be refined into mithril or some other sort of alloy, so the initial profits weren’t high. They had to slowly develop and up their scale.
Next was the production of the mortars. Claude earned around ten thousand crowns in profit from that, but now that war was no more, the theatre couldn’t order more. The mortars they already had in stock would last the soldiers a long while for their training sessions, so there was no way he could count on more profits from mortar orders anytime soon.
Then, there was the engine sector where the hot-air and steam-powered engines were being developed. However, Claude had promised Weyblon he would reinvest all profits generated from that endeavour for the next three years into further development. As it was only the third year of that arrangement, he would only be getting the profit the following year.
And then there was this arms factory he was trying to get running. While he had obtained Shiksan fabrication equipment from Borkal for free, there was much else that needed funding. For instance, there were Claude’s tasking of Liboyd and Sonia to survey a good location to set up a factory, a good place to purchase the mining rights for black firestone, hiring a few machinists in the colonies as well as other rogue rune magi, converting existing water-powered machines to hot-air ones, constructing the actual factory facility itself, hiring workers, and training them in the use of the new equipment and the setting up of cartridge production lines. Claude invested 280 thousand crowns into that endeavour to be able to give the factory a kick start.
While Liboyd was the nominal owner of the arms factory, the one who ran it was Sonia. Their estimations put their talented workers around a thousand plus. Currently, they were working at a rate of producing three thousand new rifles per year and four million brass cartridges. In terms of finances, they were making a slight loss, but it wasn’t too debilitating since the factory only required 30 thousand crowns to maintain including production costs.
Ideally, they should be hiring more and more workers to undergo training until they had two thousand employees in the factory. That would raise the annual maintenance cost to 50 thousand crowns, but they could produce ten thousand rifles and ten million cartridges at that rate, production costs included. If they sold the new rifles at eight crowns each, they could earn up to three crowns in profits for each rifle sold.
However, Claude only had some 100 thousand crowns’ worth of savings remaining. He still had to fund Angelina and Sonia for constant development and experimentation for proper tube mortar launchers. Additionally, he had to experiment with modifying light-infantry cannons to fire explosive shot instead of just scattershot and round shot. There was much money to be spent on those developments.
Liboyd’s research had completely transitioned from firearms to engines, and Claude would have to provide him with funding too. All in all, his 100 thousand crowns wouldn’t amount to much else. He wouldn’t even be able to maintain the factory at the minimal production rate for two years. So, he hoped the theatre could be his guarantor for a loan of a million crowns to solve his crisis.
As for Bolonik’s worry that paper notes wouldn’t take off, Claude didn’t pay it any heed. The paper notes were backed by the theatre itself, after all, and could be exchanged for real coin. As long as enough notes were gathered to amount to a thale, anyone could exchange the notes at the overseas bank for an actual thale coin.
Additionally, the notes could be used to pay taxes. That further cemented the interchangeability of notes and coins and also ensured that the notes would be circulated in the colonies in a healthy manner. There would also be measures to run checks in the market to punish or fine merchants that refused to accept notes as a means of payment by revoking their trading licences.
On top of all that, the units serving the theatre, ranging from the troops in the two corps to all the garrison soldiers, would be paid entirely in notes. In time, the citizens of the colonies would realise the benefits of using paper notes. At the very least, they would no longer have to carry large sacks of copper coins with them prior to making purchases, lest they attract the attention of thieves.
Bolonik finally nodded. “If you insist on getting a loan, the theatre can be your guarantor. But I really hope you reconsider. I’m not joking when I say you’ll only be able to get half of your one million crowns in loans if the paper notes end up worthless. That would mean you’ll make a loss of half a million crowns.”
“Wait,” Skri said, “I don’t understand why you need to borrow a million crowns? You can easily distribute the risk to others. If you’re willing to offer up the shares of your factory, I’m sure many rich folk in the colonies would be willing to buy them off you. They’ll buy them at a premium and you’ll be able to raise lots of funds easily.”
Claude shook his head. “The reason I’m borrowing a million crowns is I need them for more weapon experiments. I want to develop new kinds of weapons that are never before seen. The mortars, for instance, are mostly used for attacking. But while the mortars we found in the Shiksan smuggling ship are heavy and inconvenient to use, they are perfect for use in defences. We can launch them far away with our standard catapults. Our troops will no doubt be under threat if we have to face such a setup in an attack.
“That’s why I have to research even newer forms of weapons to ensure that we’re always a few steps ahead of the enemy, such as modifying light-infantry cannons to be able to shoot explosive rounds. If we sell shares for the arms factory, even if the new shareholders have small amounts of our shares, they can still exert some influence on our operations. We’ll also have to publicise our accounts. I don’t want the hassle of dealing with them, and having public shareholders will make it really hard for us to keep secret weapon projects under wraps.”
Claude knew that Skri was offering a suggestion as a kind gesture, but his explanation rendered the other generals speechless. All investors wanted returns on their profit, but Claude would be dumping all the money into a bottomless pit of investment. Nobody would be willing to buy into a scheme like that.
“Then let’s get you your million-crown loan from the overseas bank with the theatre as your guarantor then,” Bolonik decided.
If paper notes could successfully take off in the colonies, then Claude’s arms factory would be able to make ten thousand new rifles and ten million rounds each year. In five years, he would be able to pay the loan back in goods. Naturally, the loan would be interest free. The theatre only had to pay 200 thousand crowns annually to eventually clear the debt. With the loan, Claude’s minimum obligations would be to provide the arms he promised. He was free to use the rest of the funds for other experiments.
Since the theatre was going to be his guarantor, the matter was set in stone. Claude breathed a sigh of relief. “Let’s go to my office, then. I have a really good business proposal I want you all to hear. Perhaps you might be interested in becoming shareholders as well.”
The generals were quite surprised. Claude wasn’t willing to offer up shares for the arms factory, yet now he said he had a business opportunity for them. Would it really be more profitable than the arms factory, however? After all, the factory would be producing bleeding-edge new rifles, albeit with rather expensive price tags. The price was so high that the theatre didn’t dare to outfit their two corps with the new rifles right away. They only settled for slowly switching the guns out ten thousand rifles per year with the loan scheme.
When they entered his office, Claude took out a rolled-up scroll and laid it open on his desk. It was a blueprint for a black, metallic thing. On top of it was a cylindrical object laid horizontally. The cylinder had a smoke chute poking out from the back and below it was a rectangular object sandwiched between two steel wheels were connected to a long metal axle. Behind the cylinder was a small room that looked similar to a coach.
One of the drawings depicted the metallic object letting out smoke into the air dragging tens of other similar coaches behind it with steel wheels, coursing through the plains. It was worth noting that the ground on which the contraption travelled wasn’t the usual flattened or cobblestoned path for carriages. They were two parallel rails with cushioning pieces of wood in between.
“What is this? A kind of carriage?” Birkin asked.
Claude nodded. “Yes, it’s a railway carriage, or a train. It travels on a rail. The main component of the train is the frontmost locomotive. It is powered by a steam engine that moves the wheels beneath it, allowing the carriage to drag the tens of other ones behind it. Grandmaster Liboyd has confirmed that the head carriage can be built. We’re currently running trials and have seen modest initial success.
“The prototype head carriage he made can pull ten rear carriages filled entirely with black firestone. It travelled in three rounds of railroad, roughly 1500 metres, before expiring due to inadequate materials used in the forging. However, he promised that he’d be able to solve that production issue in the next three months and completely refine the internal structure of the head carriage.
“The area the colonies occupy is far too wide. It takes up to a month to travel from Vebator to the southmost Aduras colony. If we go by sea, we’ll take 20 days at least, but the risks are far more substantial. While we’re sailing near to the coast, we wouldn’t be able to completely prevent pirate attacks or some other maritime accident.
“But if we travel by train, it’ll only take seven days and nights to travel from Vebator to Aduras, assuming it travels at a rate of 30 kilometres per hour. The longest it’ll take is ten days. The reason for that is simple. Riders have to ensure their mounts get enough rest and sailing requires a safe place to stop during the night. However, trains can travel without stopping. The guests can rest within the cabins and even sleep as the train cars move. When they awaken, they’ll have reached their destinations.
“Militarily speaking, trains can ensure we don’t need to march our troops long distances. We can send them to the frontlines using the train and it’ll greatly help with deployment and reinforcements. For civilians, they can use trains to ship large amounts of goods easily and also travel from one place to another without much trouble. All the train needs is a steady supply of black firestone and water for steam.”
Actually, Claude only had to describe how the train worked and the other generals would easily be able to picture what kind of impact the train would bring to the colonies. They didn’t doubt his words at all. It was indeed a rather good business venture. If they could own a small share in it, they would have enough wealth to be passed down in their families for generations.
“How do we get a piece of the shares?” Bolonik asked.
“I’ll give each one of you two percent shares for ten thousand crowns. The four of you will own up to eight percent in total. my own shares will be twelve percent, and I’ll put in 60 thousand crowns for it. Coupled together, we’ll have 100 thousand crowns. Grandmaster Liboyd and his daughter, as well as their technician team, will own up to ten percent in shares for the creation of the head carriage. As for the other 70 percent, I plan to use them to raise funds. They’ll sell for 20 thousand crowns per one percent, and the total of 1.5 million crowns will be used for the construction of the rails and the formation of the railway company.” Claude had long drafted up a plan for that.
“But Balingana and Robisto are separated by Dorinibla River…” Eiblont reminded.
“There are two methods to deal with that. We can build railroads all the way to Dorinibla River and stop there. We’ll have another railway line on the other side of the river. The other method is to build a steel bridge across the river to link the two colonies into one, but this method will cost more as the technological challenges are much harder. It’s still not certain whether it’d be possible. We might have to further dilute our shares to raise more funds from the populace for that steel bridge…”