Governance

Make control, payment priority, and default rules explicit before launch.

This page is the working governance structure behind a Hadto venture. It is for operators, lenders, community investors, and deal readers who need to know who gets paid first, who runs daily decisions, what changes after a trigger, how this differs from a policy memo or template, and which documents should come out of the structure.

Use this page before roles blur

Who should read this

Operators, senior lenders, community investors, and deal readers who need to know who controls money, decisions, reports, defaults, and mission protections before a venture launches.

Why it matters

Governance prevents role confusion. It keeps operator authority, lender remedies, community rights, reporting duties, and mission locks from being explained differently after money has moved.

What the page helps decide

Whether the structure is clear enough to keep drafting, which missing rule should be written next, and which ambiguity should stop a deal conversation.

Compare it to common substitutes

Not a policy memo

A policy memo can describe intent. Hadto governance has to name the capital stack, approval rights, default triggers, reserved matters, reporting duties, and mission lock that carry the intent under pressure.

Not an operating agreement template

A template can supply clauses. This structure starts with the business roles and cash priority so the documents match who runs the company, who gets paid first, and who can act after a breach.

Not a dashboard project

A dashboard can display activity. Governance decides which reports matter, who receives them, which events require notice, and what authority changes when a trigger is reached.

What the structure should produce

A reader should be able to trace authority from ordinary operation to stress without asking for a separate explanation.

  • Capital-stack order, payment priority, and first-loss rule stated before deal economics are discussed.
  • Decision-right map, trigger table, reserved-matter schedule, reporting calendar, and material-event notice rules.
  • Mission-lock and conflict rules that state what ordinary operating votes cannot remove.

Core vocabulary

These terms keep one meaning across the site. Use the glossary before reading the role, service, blog, or governance pages.

ownership model

Hadto's structure for making operator authority, capital priority, handoff rules, reporting duties, and downside triggers explicit before launch.

operator

The accountable person who runs ordinary service-business decisions and carries responsibility for pricing, quality, staffing, customer response, and cash discipline.

venture

A specific Hadto-backed service business or operating company with its own demand, documents, capital stack, operator, and reporting duties.

governance

The documented decision rights, reserved matters, reporting duties, trigger rights, mission protections, and conflict rules that keep control legible.

operating system

The teachable method beneath a business: workflows, source-of-truth rules, evidence trails, review gates, and operating cadences that make work inspectable.

Governance mechanisms

A reader should be able to scan this page and find the actual rules before reading any philosophy. The mechanism list names the documents, rights, reports, and triggers that carry the deal under pressure.

Published capital stack

Each venture shows the same order before deal economics are discussed: senior lending first, community participation below senior claims, and operator common equity at first loss.

Decision-right map

The documents should say which decisions stay with the operator, which require consent, and which move only after a negotiated default or covenant breach.

Trigger table

Lender remedies, consultation rights, cash controls, and workout authority step forward only after named trigger events. They should not depend on vague concern or informal pressure.

Reserved-matter schedule

Major debt, equity changes, asset sales, operator replacement, claim-priority changes, and mission changes belong in an explicit reserved-matter list.

Reporting calendar

Monthly financials, quarterly management updates, annual packages, and immediate material-event notices should line up with the rights each stakeholder actually has.

Capital stack order

The stack shows who sits where, who gets paid first, who takes first loss, and which rights are economic versus control rights. Deal-specific economics can vary by venture and belong in the underlying offering and memo materials.

Capital stack for one Hadto ventureThree stacked capital layers. Senior lending sits at the top with first claim and yield-only returns. The community token layer sits in the middle with subordinated yield plus upside. The operator equity layer sits at the bottom, takes first loss, and holds ordinary control while the venture is solvent.One venture capital stackCash priority runs top-downCASH WATERFALLLOSS ABSORPTION1Senior Lending LayerSecured term debt and small working-capital revolverSecured claim; first-priority lien on venture assetsAbsorbs loss last, after all junior capital is exhausted10-12% gross IRR; yield onlyMonthly interest + scheduled amortization2Community Token LayerTransfer-restricted revenue-share preferred unitsSubordinated to senior debt; senior to common equityAbsorbs loss after common equity and before senior debt15-18% gross IRR; yield + upside kickerQuarterly distribution when covenant tests pass3Operator Equity LayerCommon equity; Hadto participates only in this layerResidual claim; owner-operator holds 60% voting commonTakes first loss and keeps ordinary control while solvent25%+ target IRR; residual upsideResidual quarterly or semiannual common distributionsOperating cash: reserves and statutory obligations -> senior debt service -> community distribution -> common residualRestructuring control shifts to senior lenders only after a payment default or covenant breach.
Hadto stays inside the Operator Equity Layer. It does not hold a sponsor preference that jumps ahead of the community or the owner-operator.

Senior lending

Senior lenders sit first in claim priority. They get covenanted reporting, defined remedies, and step-in rights only through documented triggers rather than ordinary operating votes.

Community participation

Community participation sits below senior claims and above operator common in cash priority. It is economic, subordinated, and does not carry ordinary managerial control.

Operator common equity

Operator common sits at first loss and holds ordinary control in the healthy case. That is where founder, operator, and Hadto sponsor common belong.

Ordinary control and trigger rights

Ordinary control stays with the operator in the healthy case. Control changes only when the documents name the trigger, the right that moves, and the stakeholder allowed to use it.

Operator authority

The operator runs pricing, service quality, hiring, customer response, vendors, and ordinary operating decisions while the venture is solvent and compliant.

Senior trigger rights

After a documented default, covenant breach, reporting failure, or collateral impairment, senior rights can move into consultation, cure, cash control, restructuring, or enforcement.

Community participation limits

Community investors receive only the economic, information, consent, or voting rights granted in their documents. The community layer should not blur day-to-day operating control.

Reserved matters and reporting

Reserved matters protect the published structure without turning every operating decision into a consent process. Reporting gives each stakeholder the information needed to use the rights they actually have.

Reserved decisions

Changes to ordinary voting control, new senior debt, material asset sales, amendments that change claim priority, and distribution policy should stay inside explicit reserved-matter rules rather than informal side deals.

Consent path

The charter should show which changes require lender consent, which require class consent, and which remain with the operator in the ordinary course.

Reporting and notice

Monthly, quarterly, and annual reporting should line up with claim priority and trigger rights. Immediate notice should cover payment stress, covenant breach, litigation, operator change, control changes, and any event that could impair the published stack.

Principles behind the mechanisms

These principles do not replace the rules above. They explain why the mechanisms are written that way and where the documents should refuse ambiguity.

Authority should match accountability

The operator is accountable for the business, so ordinary control should sit with the operator unless the documents name a specific reason to narrow it.

Downside rules should be visible early

Stress-case control should be written before stress arrives. That is how lenders, operators, and junior participants know what changes after a breach.

Mission lock and conflict discipline

Mission protections, sponsor conflicts, operator incentives, and class consents belong in the governing documents, not in later explanations. Mission protections should not be removable by an ordinary operating vote.

Follow the structure into each role

Once the mechanisms are visible, use the role pages to test what each stakeholder can do, what each stakeholder cannot do, and which service work may be needed before terms move.

Start an investor inquiry

Read the source documents

The public memo and charter draft carry the longer version of this page, including venture-level economics and sample terms that should not be mistaken for final deal documents.