Knowledge Book
Descriptions of key aspects of sectors Kakol Real Estate works in.
Real Estate
Fees in Real Estate
Success fee
A fee typically paid upon the successful execution of a deal, often calculated as a percentage of the total transaction value.
Retainer fee
A fixed monthly payment that covers ongoing advisory costs, travel, and administrative expenses.
Additional costs
Fees associated with specific tasks such as document preparation, investment decks, and detailed market analysis.
Due diligence
In the financial world, due diligence requires a comprehensive examination of financial records before entering into a proposed transaction with another party.
Funds & VCs
Investment Criteria
Key performance indicators include monthly recurring revenue (MRR), customer acquisition cost (CAC), and customer lifetime value (LTV).
Metals & Commodities
Bullion & Spot Price
The Spot Price is the current, immediate market price for a physical commodity available for immediate delivery.
Refining & Purity
Assay
The chemical testing of a metal sample to determine its exact purity and fineness.
Fine Content
The actual amount of pure metal in a bar or coin, excluding any alloying metals.
Karat (K)
A measure of gold purity; 24K is considered pure gold (99.9%+).
Hallmark
An official stamp on a metal product certifying its purity, origin, and weight.
Refining
The industrial process of purifying raw metal to a higher commercial grade.
Mint
A facility where raw metals are refined and fabricated into standardized bars or coins.
Physical Metal Forms
Bar (Ingot)
A refined, cast, or minted block of metal with specific purity and weight markings.
Billet
A semi-finished casting of metal with a circular or square cross-section.
Cathode
A highly pure form of metal (e.g., copper cathode) used in industrial manufacturing.
Kilo Bar
A standard industrial bar weighing 1,000 grams (approx. 32.15 troy ounces).
Coin (Bullion)
A government-minted coin valued primarily by its metal content rather than face value.
Proof
A coin struck using special dies and higher pressure for a highly polished, detailed finish.
Storage & Logistics
Allocated Metal
Physical metal stored in a vault that belongs to the owner outright, not the vault provider.
Unallocated Metal
Metal held in an account that is not segregated; the holder is a general creditor of the bank.
Troy Ounce
The standard unit of weight for precious metals, equaling approximately 31.103 grams.
London Fix
The daily benchmark price for gold and silver set by major trading firms in London.
Warrant
A document of title for metal stored in a warehouse, transferable to take ownership.
Delivery Point
The specific location designated by an exchange where the physical commodity must be delivered.
Trading Mechanics
Markets often experience Contango (futures price > spot price) or Backwardation (spot price > futures price) depending on supply and storage costs.
Commodity Classifications
Precious Metals
Rare, high-value metals including gold, silver, platinum, and palladium.
Base Metals
Industrial non-ferrous metals that oxidize easily, such as copper, aluminum, and zinc.
Energy Commodities
Natural resources used for power and transport, like oil, natural gas, and coal.
Soft Commodities
Agricultural products that are grown rather than mined, such as coffee, sugar, or cotton.
Industrial Commodities
Metals and materials (like iron ore) used primarily for manufacturing and construction.
Actuals
The physical commodity itself, as opposed to a paper-based futures contract.
Market & Risk
Hedging
Taking a position in the futures market to offset price risks in the physical market.
Basis
The difference between the local cash price of a commodity and the futures contract price.
Forward Contract
A customized, non-standardized agreement to buy or sell a commodity at a future date.
Carrying Charge
The total cost of storing, insuring, and financing a physical commodity over time.
Mark-to-Market
The daily adjustment of a trading account based on the closing price of the futures contract.
Margin Requirement
The cash deposit required to open and maintain a position in the futures market.
Valuation & Metrics
Performance Indicators
Net Present Value (NPV)
The difference between the present value of cash inflows and outflows over a period of time, used to analyze the profitability of a projected investment.
Internal Rate of Return (IRR)
The discount rate that makes the net present value of all cash flows from a particular project equal to zero.
Return on Investment (ROI)
A measure used to evaluate the efficiency of an investment by comparing the gain relative to its cost.
Free Cash Flow (FCF)
The cash a company generates after accounting for cash outflows to support operations and maintain its capital assets.
Earnings Per Share (EPS)
The portion of a company's profit allocated to each outstanding share of common stock, serving as an indicator of profitability.
Weighted Average Cost of Capital (WACC)
The average rate a business pays to finance its assets, calculated by weighting the cost of each capital component (debt and equity).
Accounting & Governance
Financial Reporting
Accounts Payable (AP)
Short-term debt that a company owes to its suppliers and creditors for goods and services received.
Accounts Receivable (AR)
The proceeds or money that a company is entitled to receive from its customers for goods or services provided on credit.
Working Capital
The difference between a company's current assets and its current liabilities, representing operational liquidity.
Goodwill
An intangible asset that arises when a buyer acquires an existing business for more than the fair market value of its net assets.
Corporate Governance
The system of rules, practices, and processes by which a firm is directed and controlled, balancing the interests of stakeholders.
Consolidated Financials
Financial statements that combine the assets, liabilities, and results of a parent company and its subsidiaries.
Capital & Strategy
Strategic Finance
Capital Structure
The specific mix of debt and equity used by a company to finance its overall operations and growth.
Leverage
The use of borrowed funds (debt) to increase the potential return of an investment or project.
Leveraged Buyout (LBO)
The acquisition of another company using a significant amount of borrowed money to meet the cost of acquisition.
Capital Expenditure (CapEx)
Funds used by a company to acquire, upgrade, and maintain physical assets such as property, plants, or equipment.
Cost of Capital
The minimum return that a business must earn before it can generate value, representing the hurdle rate for investments.
Blockchain Core
Blockchain
It is characterized by its immutability, meaning data cannot be altered or deleted once recorded, and its transparency, allowing all participants to verify transactions.
Infrastructure & Consensus
DLT
Distributed Ledger Technology: A system for recording asset transactions shared across multiple sites or institutions.
Node
A computer that participates in a blockchain network to verify and store transaction data.
Consensus Mechanism
A protocol (like PoW or PoS) used to achieve agreement on the validity of transactions in a network.
Smart Contract
Self-executing code that automatically carries out the terms of an agreement when conditions are met.
Fork
A change to the blockchain protocol that split the chain into two paths; can be hard (incompatible) or soft.
Mainnet / Testnet
The primary functional network (Mainnet) versus a developer-focused testing environment (Testnet).
Digital Assets
Tokens & Currencies
Cryptocurrency
A digital currency secured by cryptography, operating independently of central authorities.
Altcoin / Stablecoin
Non-Bitcoin cryptocurrencies (Altcoins) and those pegged to stable assets like fiat (Stablecoins).
NFT
Non-Fungible Tokens represent ownership of unique digital or physical assets like art or collectibles.
Tokenization
The process of converting rights to an asset (e.g., real estate) into a digital token on a blockchain.
CBDC
Central Bank Digital Currency: A digital form of a country's fiat currency issued by the central bank.
Security Token
A digital asset representing fractional ownership in an underlying entity, subject to regulation.
Wallets & Security
Access & Protection
Private Key
A secret cryptographic key that allows a user to sign transactions and prove ownership of assets.
Cold Storage
A hardware wallet or device not connected to the internet, used for secure, long-term storage.
Seed Phrase
A 12-24 word recovery phrase used to restore access to a digital wallet if a device is lost.
KYC / AML
Verification processes (KYC) and regulations (AML) designed to prevent illicit financial activities.
Multi-Sig
Multisignature wallets require more than one private key to authorize and execute a transaction.
Trading & Market
Market Dynamics
Volatility & Liquidity
Market factors defining price fluctuations (Volatility) and ease of buying/selling (Liquidity).
Bull & Bear Market
Sustained periods of rising prices (Bull) or declining prices (Bear) in the asset markets.
Gas Fee
The transaction fee paid to network validators to process and secure data on the chain.
Order Book / Arbitrage
The list of buy/sell orders and the practice of exploiting price differences across exchanges.
ATH / Floor Price
The highest price reached (All-Time High) and the lowest entry price for an NFT collection.
DeFi & Web3
Decentralized Finance (DeFi)
Key infrastructure includes Decentralized Exchanges (DEX) and Automated Market Makers (AMM) that manage liquidity.
Advanced Protocols
DAO
Decentralized Autonomous Organizations governed by code and stakeholder voting rather than hierarchy.
Layer 1 & Layer 2
The base blockchain (L1) and the scaling solutions (L2) designed to improve speed and efficiency.
Oracles
Services that bridge smart contracts with external, real-world data like price feeds or weather.
Staking & Yield Farming
Locking assets to secure networks (Staking) or provide liquidity to earn returns (Yield Farming).
Zero-Knowledge Proof
A method to prove a statement is true without revealing the secret information itself.
Strategy & Management
Strategic Alignment
Effective Due Diligence acts as a safeguard, providing a methodical investigation of a business or person prior to any major investment or contract.
Performance & Optimization
Best Practices
Proven methodologies that consistently show superior results compared to other means through research and experience.
Benchmarking
The process of comparing business performance metrics against industry best practices or top competitors.
KPIs
Key Performance Indicators: Measurable values that demonstrate how effectively a company is achieving its objectives.
Scalability
The capability of a business to handle growing amounts of work or sales in a controlled and capable manner.
Actionable Insights
Information that can be directly acted upon to improve business performance and decision-making.
Bottleneck Analysis
Identifying specific constraints within a process that reduce overall throughput and efficiency.
Organizational Frameworks
SWOT Analysis
A strategic framework used for identifying internal Strengths and Weaknesses, and external Opportunities and Threats.
Value Proposition
A concise statement that summarizes why a consumer should choose a product or service over the competition.
Core Competency
A defining capability or advantage that distinguishes a business from its competitors in the market.
Change Management
Approaches for preparing and supporting individuals and teams through organizational transitions.
Risk Mitigation
Developing strategies to enhance opportunities and reduce potential threats to project and business objectives.
Business Continuity
Creating systems of prevention and recovery to deal with potential threats to a company’s ongoing operations.
Financial Investment
Fiduciary Duty
Capital Allocation is the strategic distribution of financial resources to different projects or units to maximize shareholder value.
Financial Controls
EBITDA
Earnings Before Interest, Taxes, Depreciation, and Amortization: a proxy for operational cash flow.
Budgetary Control
A system where plans are prepared in advance and constantly compared with actual results for management control.
Compliance Audit
A comprehensive review to ensure an organization is following all external laws and internal regulations.
Revenue Recognition
An accounting principle that identifies the specific conditions under which revenue is recognized as earned.
Valuation
The analytical process of determining the current worth of an asset, subsidiary, or entire company.
Divestiture
The strategic disposal of business components, such as subsidiaries or assets, to streamline operations.
Investment Strategy
AUM
Assets Under Management: the total market value of investments managed on behalf of clients.
Asset Allocation
A strategy that aims to balance risk and reward by apportioning a portfolio’s assets according to goals.
Cash Flow Forecasting
The process of estimating the flow of cash in and out of a business over a specific future period.
Cost Optimization
A business-focused approach to reducing expenses while maximizing business value and operational quality.
Arbitrage
The practice of taking advantage of price differences between two or more markets for the same asset.
Capital Structure
The specific mix of debt and equity used by a firm to finance its overall operations and growth.
Legal & Contractual
Intellectual Property
Indemnification is a contractual provision where one party agrees to compensate the other for certain losses or damages.
Contractual Provisions
Confidentiality Clause
A provision that limits how sensitive and proprietary information can be shared with third parties.
Force Majeure
A clause that frees parties from liability when an extraordinary, uncontrollable event prevents fulfillment of obligations.
Breach of Contract
A legal cause of action where a binding agreement is not honored by one or more involved parties.
Condition Precedent
A specific condition that must be met before a contract or individual obligation becomes legally binding.
Pro Bono
Professional work undertaken voluntarily and without payment as a public service.
Liability & Resolution
ADR
Alternative Dispute Resolution: Methods of resolving conflicts outside the courtroom, such as arbitration.
Joint & Several Liability
A legal term meaning any involved party can be held responsible for the full amount of a liability.
Legal Due Diligence
The thorough review of legal documents to confirm facts and risks before a merger or acquisition.
Technical & IT
System Architecture
Technical Due Diligence is the process of evaluating the tech stack, architecture, and engineering team of a target company.
System Lifecycle
Legacy Migration
The process of transferring data and functionality from outdated computing systems to modern platforms.
Interoperability
The ability of different computer systems or software to exchange and make use of shared information.
Scalability Testing
Testing that measures a system’s ability to handle increased load without performance degradation.
Cloud Optimization
Selecting the best cloud resources to maximize performance while minimizing overall operational costs.
Governance & Security
Data Governance
The overall management of the availability, usability, integrity, and security of enterprise data.
Cybersecurity Audit
A systematic and thorough evaluation of the security of a company's information systems.
API Integration
The connection of two or more applications via their interfaces to exchange data and functionality.
Technical Feasibility
An evaluation of a proposed project to determine if it can be achieved using current technology.
Mergers & Acquisitions
Mergers and acquisitions
In an acquisition, one company purchases another outright. A merger is the combination of two firms to form a new legal entity.
Deal Origination
Sourcing Channels
Direct Outreach
The proactive identification and direct engagement with potential target companies or strategic partners.
Intermediary Network
Leveraging established relationships with investment banks, brokers, and industry-specific advisors.
Proprietary Data
Utilizing advanced database analytics to identify off-market opportunities and niche sector leaders.
Institutional Onboarding
Compliance & KYC
Standardized procedures ensure rapid, secure, and fully compliant entry into global financial markets.
Project Advisory
Project Lifecycle
Dedicated management teams ensure that projects are delivered according to specifications, timeline, and budgetary constraints.
Financing
Financing Structures
Equity Financing
The process of raising capital through the sale of shares in a business to institutional or private investors.
Debt Financing
Raising capital by borrowing funds that must be repaid over a specified term with interest.
Mezzanine Financing
A hybrid of debt and equity financing that gives the lender the right to convert to an equity interest in case of default.