HEFFX Master the Reverse ICO

HEFFX Master the Reverse ICO

HEFFX Master the Reverse ICO

HEFFX has built a library of various ICO’s ready for a reverse merger. These include ICO’s in the Marijuana, Travel, Real Estate and Tech Sectors.

With the HEFFX pre-built ICO customers are ready to sell tokens day 1.

The reverse ICO is defined as the process of buying out the equity of an established company with cryptocurrency acquired through a token sale or buying a shell ICO that has been purpose built for your industry. Neither the acquired company or the token sale need be public. This means that a private company may also be acquired through a private token sale via the reverse ICO mechanism. Typically, to incentivize growth and platform adoption, some portion of the tokens are offered to the general public. It all depends on the promoter, securities regulations, and the strategic motivations behind fundraising.

Generally, and for comparison’s sake, in the reverse merger, promoters offer the general public the opportunity to become shareholders for the first time. In the reverse ICO, promoters offer the general public the opportunity to become token holders for the first time. Tokens represent equity. In such cases, these equity tokens represent voting rights and the rights to future dividends of the venture.

Traditionally, ventures limited such economic benefits to those stakeholders that financially invested in the company and employees with stock options. With the advent of equity tokens, companies may also easily accrue benefits to the initial customers and suppliers that contribute to the future success of the venture. Tokens provide a frictionless way to incentivize all stakeholders. Equity tokens may be issued to both early adopters and vested suppliers that have a stake in the company’s financial success without the hassle of implementing a share registry and tediously tracking stock ownership.

The reverse IPO, which abbreviates reverse initial public offering, inspired the reverse ICO. A reverse IPO, also called a reverse takeover, is the name given to the process that takes a private company public through the acquisition of a public company. After acquiring the publicly-owned entity, the owners of the private company then exchange their equity in the private company for ownership in the public company.

Mergers and reverse mergers are increasingly popular alternatives for promoters looking for an attractive exit. Globally, the number of initial public offerings is on the decline.

Economic factors drive companies to select the reverse merger over the tradition initial public offering. It is generally less expensive to take a company public through the reverse merger process than through the traditional initial public offering process. Traditionally, going public is usually an expensive, time-consuming, and complex process that is only suitable for the largest of successful ventures. In this regard, the reverse merger is favorable to the traditional initial public offering. Especially if the reverse merger can be conducted through a token launch that provides network effects, or other economic incentives, to the various initial stakeholders in the venture.


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S. Jack Heffernan Ph.D. Funds Manager at HEFFX holds a Ph.D. in Economics and brings with him over 25 years of trading experience in Asia and hands on experience in Venture Capital, he has been involved in several start ups that have seen market capitalization over $500m and 1 that reach a peak market cap of $15b. He has managed and overseen start ups in Mining, Shipping, Technology and Financial Services.

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