[ahominid]

My background in financial engineering is limited to trying to make sense of articles like this so maybe someone more in-the-know would be kind enough to help me understand. But when you securitize an asset, isn’t it typically an asset that has intrinsic value, e.g. property of some sort that can be easily liquidated? It seems to me that recurring revenue for a service only has value as long as that service exists. So if some startup selling dog food subscriptions stops providing that service, the subscriptions are worth exactly zero.

To take the example further, would said startup now be unable to sell the book of business to someone else before going broke?

[swiley]

I’d imagine that’s how you end up with companies like Verizon taking over services like tumblr.