Our Process

Underwriting / Rating

  • Small and medium businesses (SMBs) that wish to raise capital via a Halagard-placed Digital IPO must submit both business and financial information.
  • Halagard works with commercial aggregators of information (e.g. Experian, Dun & Bradstreet etc.) to gather information about an SMB
  • Halagard vets each company that applies, screening their financial information for evidence of stability, growth potential, and other factors impacting the company’s value to investor on the Halagard platform.
  • Applicants that are rated as Investment Grade move forward to creating an offering for investors.

Offering/PPM/Marketing

  • Halagard assists clients with the development of Offering documentation also known as a Private Placement Memorandums (PPM)
  • We support the subsequent marketing of a client’s Digital IPO to interested investors.
  • The intent of the PPM is to provide an accurate, detailed and compliant review of the company.
  • The PPM includes a summary of offering terms, estimated use of proceeds, a securities description, company risk factors, a subscription agreement, an investor suitability questionnaire, plus more.

Securitizing Assets on Blockchain

  • Ahead of the security sale, Halagard assumes the role of issuer, designing a tradable financial instrument represented by digital securities and backed by the client’s company equity, financial assets, and/or cash flow.
  • The shares of the company are moved to our blockchain which levers the Hyperledger Fabric architecture.  See our blog for more details.

Establishing Share/Bidding Price

  • Halagard uses a unique bidding process allowing investors to determine the price per share for a Digital IPO.  The process used in public markets only benefits a few companies.
    • In a traditional IPO the price per share is set by the investment banks and major buyers.  If the public markets had a bidding system open to all interested investors, then there would be few stories about a company IPOing and their stock shooting up 50% or down 20% on the first day of trading.
  • Our approach provides a middle ground where all investors (large & small) have the ability to provide input via bids.   Our goal is that stocks don’t have a wild swing in either direction when they do a Digital IPO.
    • A drop on day 1 means Investors lost money
    • A spike on day 1 means the company gave away too many shares for the capital.
    • We are building a Win / Win solution instead of the current Lose / Win scenario

Capital Raise/ Digital IPO

  • Halagard issues Regulation D 506(c) digital equity securities on behalf of SMBs via a Digital IPO
  • Investors who are registered with Halagard may purchase these securities
  • Proof of purchase is recorded on the investor’s asset record on our blockchain as a permanent record
  • Halagard processes and sends capital derived from the security sale to the SMB

Shares Become Tradable

  • SEC rules require that securities sold via Regulation D 506(c) have a one-year lockup period.  This means the shares can’t trade for one year.
  • After one year, investors can trade their securities on Halagard’s Marketplace.
  • enforced using smart contract technology
  • In a public market the Halagard Marketplace would be called an Exchange, since we are Private, we are not able to use the term Exchange.  Technically the SEC calls the Halagard Marketplace an ATS (Alternative Trading System).
  • The one-year lockup period and exclusive trading on the Halagard marketplace are.

Servicing/Annual Reporting

  • Halagard manages the distribution of shares, dividends, reimbursements and other miscellaneous payouts from SMBs to investors.
  • Currently Regulation D 506(c) offerings do not require quarterly or annual reporting.
  • Halagard requires all companies that complete a Digital IPO to file an annual report for their shareholders and provide news updates throughout the year. This ensures investors maintain access to salient company information.
  • Halagard provides resources to help SMBs create this report.
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