Why Halagard?

Halagard is building a long-term, mutually-beneficial relationship with SMBs by being more than just a providing of affordable capital. We have plans for a full suite of services including a site where SMBs can buy and sell services to each other.

Traditional Loans

  • A traditional loan can be expensive. What is the cost?
    • Your time gather and fill out different applications with multiple banks;
    • Various loan fees that are added to the loan;
    • Having 10% down payment;
    • Compounding Interest; and
    • Repayment of the principle.
  • When all said and done, the cost of an SMB loan can be 50% of the principle
  • These cost severely reduce cash flow and reduce the growth

Traditional Public Market Cost are Expensive

  • Going Public as an SMB means you will likely use a Reg A+ offering which will allow you to trade on the OTC
  • The cost are generally as follows, for the purpose of this example we will assume $10M is being raised:
    • SEC form 1A $50-$60K
    • Legal – $100K
    • Audit $2-$10K
    • Marketing generally 2-4% of raise ($300K)
    • Transfer Agent Escrow 0.5% – 1% of raise ($75K)
    • Advisory fee $100K
    • Escrow fee $30K
    • Broker / Dealer $400K
    • Total fees will be nearly $1M or 10% of the capital raise plus warrants
  • After the raise you will have additional cost, such as:
    • Annual audit – $10K
    • Transfer agent fees – TBD
    • Annual DTCC $10-$20K
    • Annual Exchange fees $20K
  • The Halagard approach is to provide a Private Marketplace, which leverages regulations that have a reduce cost compared to public markets i.e. you need to raise less capital

Comparing a Reg A+ Cost to Halagard

The one time cost are generally as follows:

Fee Area Reg A+ Halagard
SEC form 1A $50-$60K N/A in a Private & Vertical Market
Legal $100K Expect to be less
Audit $2-$10K Mandatory
Marketing $2-4% of total raise ($300K Included as part of our overall fee.

Instead of hunting for buyers across the globe we have a place where buyers gather.  Making marketing cost significantly lower

Transfer Agent Escrow 0.5% – 1% of raise ($75K) N/A in a Private & Vertical Market
Advisory fee $100K Halagard fee is $25K to $100K depending on the deal
Escrow fee $30K N/A in a Private & Vertical Market
Broker / Dealer (introductions, et.) $400K N/A in a Private & Vertical Market
Total At least $1M or 10% of the capital raise plus warrants $25K-$100K plus 2.5% of total equity in company

The Annual Cost are generally as follows

Fee Area Reg A+ Halagard
Audit $2-$10K Mandatory
Transfer Agent TBD N/A in a Private & Vertical Market
DTCC $10-$20K N/A in a Private & Vertical Market
Exchange Membership $20K Included as part of our overall fee

Lower Fees with Halagard

  • Halagard has two fees, the goal of the fees is to leave cash in the SMBs
    • First is a low sub $100K fee that varies based upon the size of the business. Smaller firms could pay as low as $25K
    • Second is a 2.5% equity stake in the SMB joining its ecosystem
    • The cash fee only covers a portion of our actual cost and we use the equity to help make up the difference
  • The silver lining for the Halagard model is that once an SMBs pays the above fees and has joined our ecosystem they never pay additional fees to use equity for capital in the future. Ask your banker for the same this term J
  • By holding equity in our customers, we are directly aligned with the commercial success of each SMB on the platform.
  • The Halagard model also mitigates the impact of economic downturns on SMBs by allowing them to raise capital when debt markets may be closed or significantly hamstrung.

Vertical Integration

  • In a traditional Public market IPO you will pay multiple parties fees.  An IPO is like a wedding, everyone knows a lot of money is going to be spent and fees are set accordingly by each company.
  • Halagard takes a different approach, by putting stacking the services normally performed by multiple companies into a single company we are able to reduce fees.  Vertical Integration.
  • Vertical integration and the use of blockchain and smart contract technology enables Halagard to transcend the legacy process, cut out the middlemen, and slash maintenance overhead costs that other capital providers demand.

Deeper Investor Pool

  • The Halagard digital securities platform provides a standard and straightforward system to connect SMBs with more potential investors than ever before.
  • Instead of searching out multiple Private Equity investors and pitching them separately, you now present your company in a single manner to a wide audience of investors.
  • Halagard’s infrastructure provides a new channel through which investment dollars can be easily deployed in the SMB market.

Alignment of Interest

  • Halagard’s application process for SMBs is designed for easy navigation and our staff is ready to guide business owners through each step of the process.
  • The underwriting and Digital IPO process is just the beginning of Halagard’s relationship with its SMBs. Halagard’s success is a direct result of our ability to help our clients achieve long-term success.
  • We have many exciting ideas related to additional services and support for SMBs.  We believe the equity market is just the beginning of how we can help SMB owners.
Do you want to learn more?

Contact Halagard to learn more about our unique platform and how you may fit into our community.

 

The Halagard Team is excited to bring our solution to the SMB and Private Equity markets and democratize the ability to access capital.

Jeff Hudson
CEO, Halagard