Perspectives · a position
What cannot compress.
Drawing a structure, modelling it, comparing the routes and assembling the documents all get faster. Three things inside the same transaction do not get faster at all, and all of them is held by somebody who is not in the room. What follows is a position on those three, and on what they do to the order in which a transaction is built.
Perspectives · seven rooms
01 · What compresses
The argument
Drawing the structure gets faster. The clock somebody else holds does not.
Sort the work of a transaction into two lists. On the first list is everything the manager and its appointed parties can finish sooner by working harder: the analysis, the comparison of routes, the modelling, the drafting and the assembly of the bundle. On the second list is everything granted by a party outside the transaction, on that party's own timetable: a consent, a registration, a connection, a confirmation, an approval, a licence.
The first list compresses. The second does not, and it is the one that decides the date. That is a description of where the two lists sit in the documents rather than a claim about the future: the first list produces paper, and the second produces facts that other people are entitled to be slow about.
02 · The three that do not
The second list
Three things do not compress, and each of them sets a date.
- Another party's clock
Consents, registrations, connections, confirmations and approvals are granted by parties outside the transaction, in windows those parties set, on evidence they specify. A consent applied for late is a closing date that has moved, by whatever that party's queue happens to be. Lead time not started is lost rather than deferred, so the count of these items belongs in the first week and not in the month the drawdown was planned for.
- Where the asset sits
The owner's domicile travels. The asset's jurisdiction does not. Who may hold the asset there, in what legal form, and with what local participation at the operating level, is a condition of holding it at all rather than a term to be negotiated with the seller. That asymmetry is answered at the entity chain, before anything is formed, or it is answered by the local register afterwards, at which point the chain is rebuilt around an answer nobody asked for.
- Standing
A permission is a release granted to a named person for named activities. It does not travel with a document, it does not attach to a letterhead, and it cannot be produced on the day it is needed. Where a route requires a locally authorised party standing in the middle of it, that appointment is a lead-time item and it belongs on the critical path from week one rather than in the paragraph of the plan that says the arrangements will be finalised.
03 · What it does to a structure
The consequence
The date is set by the items nobody in the transaction controls.
Three things follow for the design, and all three are decisions about where an item is written rather than about how hard anybody works. Every dependency is named against the party who can make it true and the week it has to be true by, because a dependency with no owner is a hope with a deadline on it. Every item on the second list enters the entry instrument as a condition, with the party who grants it and the date it is needed by, rather than as a covenant to be cured. And the sequence is drawn before the spending starts, because the only phase in which a lead-time item is cheap is the one where nothing has yet been relied on by anybody outside the building.
That is the whole of the argument for reading the order of a transaction before it starts. Which steps cannot be taken a second time is set out at the one-way doors, and what naming a dependency against its owner actually looks like is set out across the fifteen rooms at worked structures, where every dependency named carries an owner and not one of them is ours.
04 · The position
Dated, falsifiable
Amended in the open.
The position: the drawing, modelling and assembly of a structure compress, while another party's clock, the place the asset sits and standing do not; a transaction's date is therefore set by the second of those two lists; and the design work that matters is the work of moving items from the programme, where they are tasks, into the instrument, where they are conditions with a holder and a date.
What would change our mind, stated now so the record can be checked against it. On the clock: if consents, registrations and connections begin to arrive inside programmes that were not drawn around them, the first claim fails and we will say so. On place: if the conditions governing who may own an asset where it sits become terms the transacting parties can settle between themselves, the second weakens. On standing: if a permission begins to travel with a document rather than attaching to a named person for named activities, the third was never structural. Each of the three is watchable on the face of the instruments, and the result will be carried here either way.
None to date. This row is where they will appear, dated, under the convention set out on Perspectives.
Perspectives · 6 minute readPerspectivesStructural work published in full. Fifteen places structures break, sixteen steps with the doors marked, five open questions, five worked structures, seven positions.
Perspectives · 10 minute readThe one-way doorsMandate to first drawdown in sixteen steps, each marked reversible, expensive to reverse, or a one-way door.
Perspectives · 17 minute readExposure through an existing platformA worked structure. A fund already formed, invested and borrowing wants exposure to an illiquid asset under another body of law. Six constraints, three routes, one that survives.