Secondary ATS & Closing

Speakers

Oscar Jofre

CEO and Co-Founder

KoreConX

Oscar Jofre

CEO and Co-Founder

Oscar is currently one of the Top 10 Global Thought Leaders in Equity Crowdfunding, a Top 5 Fintech Influencer, Top 10 Blockchain and a Top 50 InsureTech. He has published an eBook that has been downloaded in over 20 countries, and been distributed by partners worldwide. Oscar is a featured speaker on Fintech, regulated, equity crowdfunding, compliance, shareholder management, investor relations, and transparency in the USA, Australia, UK, Germany, France, Netherlands, Canada, Singapore, Indonesia and China. He speaks to audiences covering alternative finance, RegTech, insurance, banking, legal, and crowdfunding. Oscar also advises the world’s leading research, accounting, law firms and insurance companies on the impact Fintech, RegTech, LegalTech, InsurTech and OrgTech is having in their business.

Dr. Kiran Garimella

Chief Scientist & CTO

KoreConX

Dr. Kiran Garimella

Chief Scientist & CTO

Kiran Garimella, Ph.D., is the chief scientist and chief technology officer at KoreConX, leading the strategy and development of blockchain and machine learning solutions. A sought after speaker and author, Kiran has more than 25 years experience in information technology, consulting and financial services. Previously, Kiran held roles such as global CIO and chief architect at a General Electric company and vice president and chief evangelist for BPM at Software AG. He is also an advisor to the Alliance of Merger & Acquisition Advisors and the MidMarket Alliance, principal founder of iKnowCentral and co-founder of CognitiveWorld.com.

Lee Saba

Head of Market Structure

Rialto Markets

Lee Saba

Head of Market Structure

Lee Saba brings more than 20 years of experience in the financial services industry. Prior to joining Rialto as Head of Market Structure, Lee was Managing Director and Principal at Wellington Management where he was responsible for proprietary and third party multi-asset electronic trading and connectivity infrastructure. For over 17 years, Lee led and contributed to industry standards on a variety of concepts including FIX post-trade for equities, futures and FX, execution venue normalization, risk mitigation symbology and electronic trading risk controls. While at Wellington, Lee headed the inaugural IT FinTech Working Group and was a vocal advocate of the investor hub for blockchain and digital assets research. Lee currently serves as the co-chair for the FIX Trading Community (https://www.fixtrading.org) consisting of 290+ members worldwide and is also an active steering committee member for Northeastern University’s D’Amore-McKim School of Business FinTech Initiative.

Stephen Brock

CEO

Medical Funding Professionals

Stephen Brock

CEO

Stephen Brock, CEO of Medical Funding Professionals, is a registered investment advisor with over 22 years of experience in the financial sector, including private placements, public capital markets, and regulatory compliance. He has helped over 50 companies enter the public capital markets, including his own.

Oscar Jofre  00:00

Look forward to seeing all of you again. And now we’re going to get ready for our last panel for this afternoon, which is very dear to me. It’s dear to me because it, it requires us to, to really think about that question that Nick put to all of you. So for all of you that are still here since the beginning, he said, and I quote, you must really articulate your exit strategy. And you must think about it. And going public or being acquired is not the only choice you have. Now, it’s not the only choice you have. So now you have two other, you have an additional choice. And that additional choice is amazing. If we didn’t have it before. Imagine this, private companies. You know, if you wanted to sell your securities, your shares to someone, you needed to do it differently, you needed to find a buyer on your own, or maybe what you needed to ask permission from the company, you needed all these different reasons why how you could sell your shares in a private company, or you were under some heavy agreement prohibiting you from doing that. Well, guess what, and Regulation A plus is a free trading security. As you know, Lee and Kiran are going to talk about how that happens. And to make sure that, you know, you have a good understanding of the secondary market, the secondary market didn’t exist.  I’ll give a little bit of history on it, while the my two colleagues get themselves set up. But one of the things that’s really exciting about the private markets is that we didn’t have any of these things, or if they did exist, they were only available for a very small percentage of the market. The ultra high net worth and you guys read about it, you know, when people you keep hearing, Hey, wait a minute, who is trading those Facebook shares and all that that was a very small audience in a very controlled secondary ATS it was the who’s who could play in there are institutional investors. And the ATS were really created for dark pool trading for brokers to do it, you know, so, but now, it’s been brought out to everyone. And Rialto is the very first secondary market ATS trading platform that is available for the general public. That’s right, the general public anybody over the age of 18, to be able to come in and buy shares in privately held companies. So that is a game changer. In the market. It’s so it’s, it’s been unbelievable, how it has been received in the market. We are in the early stages of it. Holy mackerel, Kiran, you look like some UFO creature, but that your background showed it. It’s amazing what this evolution has done. For all of us. We’re in early days, a lot of questions being asked, you know about liquidity and pricing, where that’s not yet. It’s not here for that. What is here is that today, you can say to a privately held investor, if you need to monetize your investment, my company allows you the ability to monetize that investment in a regulated ATS Rialto Market. There it is. Whether they do it or not, is another question all itself. The point is, you’re offering it to them, and it’s going to happen, make no mistake for all of you that are listening today. Make no mistake, this will be like a feature in a car. And I’ve been saying this a lot. Because the thing about cars is they got lots and lots of features. But if you really think about it, all you really need it is a gas pedal, brakes, light switch, and that’s it. Everything else is just joyfully extra, right? Do you really need a warmer for your handlebars. But if it doesn’t have it, and the other one does well, for the same price, you know, that’s the point. And secondary market will be something a lot of companies will be bringing out there. So it’s important for everyone to understand what it is how it works. And guess what? I brought you the brainiacs that put it all together, and I’m going to leave them alone because the last time I got in a cage with them, I didn’t do well. I think they’re both gonna appreciate this even more because we’re talking about a vertical, life sciences, that investors are being asked to stay for 10, 15 years, and some can, some won’t be able to. And none of the founders are going to be upset. I mean, I’ve heard presentations where Stephen has brought this to their attention and CEOs, like all that would be great. I don’t want to cash out, but I know they’ve been with me for 10 plus years, I would like for them to get a little bit of their investment. See, every CEO thinks about their shareholders, why wouldn’t you? Any CEO that fears secondary market, then you’re going to have to deal with it sooner or later. So with that in mind, with that little prelude that I brought in, I like to introduce you to two amazing guests that I speak to frequently about secondary market, one on the technical side, and one more on the, the whole concept of how it all works. So first of all, we have Kiran Garimella, Dr. Kiran Garimella, my apologies. So this afternoon, and of course, from KoreConX, and Mr. Lee Saba, from Rialto Markets. So Gentlemen, I only introduce you by name, please let everyone know your name. So keep in mind the audience. This is the new vertical regime we’re going to we are Shari already provided everyone a little quick demo, how to trade. But how does it all happen? and answer all those questions regarding volatility and price? And how does it mechanism? I leave it to both of you have fun. 

Dr. Kiran Garimella  06:25

Thank you. Yes. Absolutely. Oscar, thank you so much. And I can’t tell you how excited I am, you know, just to be on this panel, and you’ll see this weird, slightly different background, and I said, as a techie, and to kind of show off and say, you know, hey, I feel like, you know, this is where in the last mile of this entire journey of end to end, you know, in the private capital markets. And this is like going into space, right? It’s like, I wanted to say, you know, this is the final takeoff. And you know, we have really launched a fantastic partnership and a platform to help us get to this secondary market. So. So Lee, how do you how do you feel about all this stuff? I mean, I know, we’ve been talking about this and dreaming about it. And we work very closely as a team in building a very, very fluid platform.

Lee Saba  07:15

Yeah, thanks, Kiran. And, you know, by the way, My name is Lee Saba, I am head of market structure for for Rialto Markets. And as Oscar was saying, you know, we’re we’re trying to stitch this all together, and, you know, design the, the compliant way to handle secondary trading. You know, I think today is just, you know, we’re at a milestone, right. And, you know, as some of the earlier panelists have mentioned, that we couldn’t really do this before, you know, in the private market space, and now, we actually have a regulated, fully compliant platform, not only across, you know, a broker dealer, an alternative trading system, but also, you know, a great partner in KoreConX where, you know, they’re, they’re an innovative forward thinking, transfer agent that actually has built something, you know, with us to allow for secondary trading. And, you know, Kiran, I know we’re gonna walk through some of the process there. And, you know, what the, what the handshakes are, at, you know, probably maybe a mid level, you know, high to mid level. Just just to get everybody a little bit closer to to what would happen when you when you enter into the ATS.

Dr. Kiran Garimella  08:30

Almost certainly, and, you know, it what’s what’s amazing about this whole innovation and me with my, you know, in the role of a chief scientist for KoreConX, it strikes me that when we all went to the private capital markets, and said, you know, that is an underserved market for, you know, everybody, and it’s something that we really need to look at. It’s amazing that, you know, as an industry, generally speaking, you know, we have allowed investors to come in, unlike in the public markets, where they get in the tail end of an IPO process here, they come in right in the front end. But then we lost something on the tail end, which is a secondary market. And that has been a known issue right from the beginning. And we have talked about it. So there’s a lot of innovation that kind of went into this whole idea of how to do this in a secure, safe and very compliant way. And along the way, there have been many challenges. And of course, as we looked into this entire space, we were amazed at what it takes to create this really seamless, you’ve seen the demo, right? I mean, you know, people have seen this demo that Shari and Julien and Amanda have done on the trade button and you know, how people can come in and complete the entire lifecycle so seamlessly, you know, with no problems at all, but there are a lot of productions that were kind of went into that right and i think Lee one thing You mentioned is really on the whole liquidity and the fluidity and you know if you can kind of share some of your thoughts on that that’d be fantastic.

Lee Saba  10:08

Sure, yeah. I mean you know, a lot of times we use the term fluidity and it’s kind of a newer term and it goes hand in hand with with liquidity in some rounds because you know, what we’ve done is designed a seamless compliant path into the ability to trade or transact so you can buy your shares or or sell shares you know within this process without having to go the old way which was you know, maybe calling the original issue or maybe talking to the transfer agent maybe contacting your lawyer their lawyer contacting your lawyer and then eventually over weeks months years finalizing a trade now we can do this in you know, seconds once everything is all set up and and ready to rock so you know Kiran and I have spent a long time in numerous numerous calls stitching out this new fabric to facilitate this trading and you know, we couldn’t be more proud of it but it’s it is it would look and feel like a traditional account you know, whether you had it at you know, Vanguard or Fidelity you know, it’s one it’s very similar in nature but under the hood, it’s it’s much different because it has a completely different market structure and different dependencies. And I don’t know, Kiran if you wanted to walk through a little bit about you know, that the steps in the process as to how, how the the trade would would originate.

Dr. Kiran Garimella  11:40

Absolutely, and I think when we were designing this there were a couple of principles in mind in the forefront of our mind really and that is we need to make sure that the investors are totally protected you know, and I know you know, you have some thoughts on what finality really means in a space like this and you know, I’m sure we’ll share that in a minute. But you know, protecting investors was absolutely critical and then being compliant and we have seen so many scams in this entire area and you know, we have looked at a lot of these you know, I won’t say platforms necessarily but you know, there are there have been a lot of fly by night and operators who came and went obviously, and just being compliant and making sure that you know, both the investors and the broker dealers and you know, the trading platforms and the clients the companies all of them are you know, completely compliant and you know, nothing is bad is going on so the entire process really you know, really starts with you know, people who have invested our shareholders of companies that are on the platform and now they say well wait a minute, these are free trading shares and you know, maybe I would like to sell some of my holdings and typically that’s what it is. And I tell you in most of the people that you know, we know that we talked to and investor shareholders and you know, they are in it for the love the companies and they want to be in it and especially med tech you know, I have a soft spot for med tech myself and my mom’s a doctor and you know, we have a medical background and all these people you know, they really care they want to be in touch with their CEOs and companies but at the same time, they also want to look out and say, Hey, wait a minute, that often is closed in that other med tech company or a health tech company and should I would love to have participated in that one so it’s a it’s not a matter of I necessarily want to sell everything it’s a matter of Hey, can I also buy something else also that I’ve missed earlier on right? So

Lee Saba  13:40

It’s not always a sell conversation it you know, in order to buy more conversation, you know, a lot of times it is and it a lot of times it’s it’s allowing access to folks outside of the original primary raise. So you know, there are folks that are there again, all compliant AML KYC they’ve been you know, authorized as good citizens to participate in this. And again, it kind of goes to some of the interactions that we have designed to to efficiently update the cap table when somebody you know, wasn’t part of the primary Investment Group.

Dr. Kiran Garimella  14:18

Absolutely. And you know, as as you know, people might have heard on the some of the previous sessions, once a once a person is on the cap table, they are known people I mean there’s you know, we know who they are their KYC ID AML verification service done. Everything has been collected, it’s all very clear who they are. But now let’s say somebody decides and says you know, hey, I want to sell some of my holdings, which is a fantastic [uncertain] and thing to do. You know, obviously you’ve seen on the demo how they can come to the trade button, and it seamlessly once it’s all set up, very seamlessly takes them into the the trading platforms themselves, the Rialto platform, right and, and I know A lot of magic happens on that note, which, for people who are not familiar with the extent of the number of checks and balances, and due diligence and compliance checks that are done both on the KoreConX platform, and seamlessly, also on the Rialto platform, I think it’s an eye opener, I remember, you know, we were sitting down, and we were having a conversation and in all the different things that we need to check for to make sure this is all compliant and safe for everybody. There were like 25 checks that, you know, we have to go through and kind of really make sure that everything is hunky dory. So I would love to know if you can share on from your side, the whole question of the matching the liquidity and the finality, I think that would be an eye opener for people to hear.

Lee Saba  15:50

Sure, yeah, um, you know, maybe it’s helpful to just kind of, you know, walk through the first the process, and then maybe some of those questions will be answered, you know, throughout. So, you know, first of all is a 20,000 foot view, you know, say, you know, medical technology company decides to list or, you know, allow themselves for secondary trading on the Rialto ATS, obviously, we have to have all your folks on the original cap table captured there already within the KCX platform. And, you know, we would work collectively to set up the security for secondary trading, you know, we would request the [uncertain], something like that, and a [uncertain], for those who aren’t super familiar with, or what they call security identifiers, so that we can trade efficiently in the marketplace. So you can look these things up, you know, on a Bloomberg terminal or, you know, on Yahoo, once they get out there, you know, we would set a launch date with working with the issuer, ourselves and KoreConX, and, you know, probably notify the existing shareholders, that trading is now available, right. So, they would have to come in, you know, in in register themselves a little bit with the ATS. And again, this kind of goes into the finality conversation, because, you know, we have to get them onto the ATS platform, as well as you know, work out, you know, some payment rails. So we’re really working on both ends of the spectrum. One is, when we get you on the onto the ATS, we know who you are, we’re doing AML KYC, we’ve already you know, understood the those processes, but we check to make sure that, you know, Kiran has 500 shares of, you know, XYZ company, the buyer, we do on the reverse and say we have to make sure that so and so has enough money on hand to perform the order that they’re trying to do. So, that helps us again, ensure finality, because if there is a match, we know that Kiran has the shares and the the purchaser has the money and that allows us to really avoid a lot of trade breaks. And and just again, protect both sides because you know, if you had to wait for the settlement to occur and then you find out that Oh, you’re excited that you’ve got the shares and then we have to say sorry, so and so didn’t have the money that’s not that doesn’t create any confidence it’s not good on the reporting cycle, it’s, you know, you want to just be rock solid anytime you come into the platform and know that both orders are very sound.

Dr. Kiran Garimella  18:44

Absolutely, and, and one example of the the, the amount of due diligence that the platform so, seamlessly perform is you know, whenever a shareholder wants to sell, there could be a very interesting case on the back end, where they have placed a transfer request. So they may be transferring part of their holdings to you know, some beneficial owner on their side a family member or somebody else. And of course, you know, all parties in all Rialto on the trading side trading mechanism engine and us as a transfer agent, you know, we all need to make sure that those things have been accounted for and you know, they can right package everything that they’re trying to transfer the same time trying to sell it to. So there is quite a bit of due diligence that happens. One other thing that also we as you know, designers and implementers of something like this have placed at the forefront of our mind is how to make sure that we have total trust everyone has total trust in this entire process. So it isn’t just a matter of, you know, us and Rialto or just a few selected, you know, people knowing about it and doing this thing is also being immutably stored on a permissioned blockchain at the end, right? And I don’t mean to go any of the details here. That’s not the time for that. But right from the get go, every transaction, every click, every communication back and forth, are all recorded very seamlessly on the on the KoreChain, which is our permissioned blockchain itself.

Lee Saba  20:24

Yeah, no, those are all super important aspects I like would you say the the infrastructure of trust trust, right. I love that term. And that’s exactly what it is. And, again, you know, just being innovative looking at, you know, digital ledger technology, or, you know, blockchain based technologies in a permissioned world. Again, these are not permissionless, I’m not going to get into the crypto geek side of things. But, but, but it’s, it’s a good tool, and obviously, you know, we can leverage it as well, as a as an API layer to increase communication in between ourselves. So yeah, it’s all really good. And, you know, and I wanted to just emphasize that point about, you know, this new market structure, when, when a trade is put on, by, you know, somebody who’s trying to sell, making sure that those shares are unencumbered is is a huge factor. And that’s the responsibility of the transfer agent, because they’re working for the issuer. And they have to, you know, maintain all of those, all those rules and regulations and keep them updated. So when we go to pain as Rialto in the ATS, it tells us, you know, gives us a green light or red light, you know, to move forward with this transaction. And like you said, there might be 25 checks that that before that green light goes off. And it but they’re all very necessary. And, you know, again, it it, it helps with finality, and making sure that every step of the process is, is sound.

Dr. Kiran Garimella  22:02

Oh, absolutely. And, you know, it’s the many things that happen on the back end of the transfer agent side, and also, you know, the transfer agent is really out there to make sure that the company is compliant, but also the investors are protected, the shareholders are protected, right? So it isn’t only on the outgoing side, when somebody is trying to sell something through, they already own shares, and they’re selling. But even on the buy side, there is a question of, you know, how do buyers on the other side of the fence when the matching engine performs its magic? And how do they on the buy side come and get taken in into the platform and become legitimate shareholders once a transaction is final right? Could you maybe throw a little bit of color commentary on what specifically happens to investors who say, you know, what, I have no shares at all, in a company that’s only KoreConX platform, as you know, part of you know, your clients, but I do want to buy on the secondary side, I want to come in fresh secondary. So how does? Can you put some color on that particular process?

Lee Saba  23:14

Yeah, of course. Now, it’s a great question. So what what we would do on the Rialto side is, you know, we call them maybe, you know, off the street, or, you know, folks that get processed outside of, you know, say, the KoreConX platform, we would bring them in, we have an onboarding platform ourselves, again, we run them through AML, KYC, you know, as a registered broker dealer, you know, sec and FINRA approved. So once, once they pass muster, you know, they would come on, they would have a Rialto ATS login, they would obviously have some payment rails already baked into the process, which which they would have gone through when they signed up. Once they’re clear, they would start, you know, participating on the ATS. Now, if it was one of the KoreConX issuers, they would, and they wanted to buy something there, we would allow that to occur, right? Because we would make sure that they had enough money to go forward. And then the process that you and I painstakingly, you know, pulled apart was to, you know, how we would notify you of this new person with all the pertinent details and create a new, you know, IDs for them and store them at the transfer agent for you know, for to move shares from A to B So, you know, from the, from the, from the seller to the new buyer that you’d never recognize before but because of our broker dealer status, you know, we have some collaboration there where you know, they’ve they’ve passed the high bar of AML KYC.

Oscar Jofre  24:58

I have emerged

Dr. Kiran Garimella  24:59

Have you? Have you learned people? We could you

Oscar Jofre  25:06

You know, but I also, because there were some earlier questions from people. And obviously, hopefully, you know, these questions can be answered by [uncertain]. So the some of the questions that have come up, are, you know, it’s great to have secondary market. So what what, what’s gonna happen when, you know, they’re my my stock is obviously going to be thinly traded, and someone you know, the the price is going down, or someone’s trying to dump it and cut it dramatically to what my value is, or, or I’m going to be doing a capital raise, how is this going to be? What is the role of the ATS with the issuer? in that in that in that process? Sure.

Lee Saba  25:48

Yeah, I know it, that that’s a great question too. And we fully understand, you know, all the complexities and questions around that, you know, there’s, there’s a few different things like liquidity profiles, right, like every issuer has a slightly different liquidity profile, there’s what I call it, right, if you have 100, shareholders, your liquidity profile is probably going to be a little bit less than somebody that has 1000 shareholders or 100,000, or 200,000 shareholders. So when you enter into these into the ATS, and you want to create, you know, fluidity, you might want to create, you know, options, when when you when you train, we can have what they call it continuous cross, you know, it by the issuer, what that means is, during normal business hours, let’s call it 930, to four your traditional market hours, you know, the, the market can always be live, and you can constantly interact with any other open order on the, on the Contra side. Now, that works much better when you have a lot more shareholders now, and that’s great, it could still work for things that don’t have a lot of shareholders, but it’s probably a little bit more suited in that fashion. But you can also have what they call point in time crosses are scheduled crosses, so you know, where you can aggregate liquidity in a point in time. So maybe it’s, you know, every once a month, once a day, you know, where you say, Hey, listen, you know, to our shareholders, we are going to aggregate liquidity from 10am to 11am, is when the, when the cross is going to happen, please place all your orders, and then we do a match of all the orders that are in there. And in every one of the shareholders is very familiar with what time to be into the system. And, you know, we’ve seen this a lot of different ways, like you said, it’s kind of a flexible process, by leveraging the ATS, you know, the, the issuer can call their cross again, we have to work out these details in advance. But, you know, it could be again, daily, weekly, real time, monthly, quarterly, annually, you know, however, you know, they would like to schedule it. So that, you know, that that’s, I just wanted to make sure that was clear, because it’s not traditional market structure, you know, we’re not, you know, it’s not the New York Stock Exchange, it’s not NASDAQ, where you have, you know, hundreds of millions of transactions happening in, in micro and nanoseconds with, you know, those traditional structures, this is a is a much different arena. But the magic, again, is allowing these trades to, to actually facilitate themselves, should there be liquidity on the other side.

Dr. Kiran Garimella  28:51

And it’s also a different type of market also, right, it’s not high frequency trading, and algorithmic trading and things like that, but these are real people with, you know, real monies and real interests and connections to the companies they invest in.

Lee Saba  29:06

Yeah, that’s true, and another point that sorry, I don’t think I answered your question was, you know, there are liquidity options there to where, you know, if the like a stock buyback program could be infused into the process where you know, if if somebody is trying to come in and you know, just selling at a penny or something, you know, all their shares and trying to dive stock there could be a barrier in there with a with a placeholder by the issuer that says, you know, I’ll scoop up anything at this particular level. So those we’ve had a lot of conversations around that and you know, we’re still fine tuning it, but you know, it’s, it is an option to create some price stability.

Oscar Jofre  29:56

Well, the key is, I think they the overall message to anyone Is that secondary market trading is now evolving, we now we we first started with, we needed to have the regulations. Number two, we needed to have the venue, we now have the venue. Now, people are finally discovering that, you know, just because the securities free trading, there’s still additional steps you need to take, right? The company still needs to find their blue sky, the company still needs to be listed in a securities manual. So just like everything else, these are steps. And how does secondary work overall, I think as time goes by, that visibility will come out more. But the way I look at it in simplicity is that you get to stay as a private company. So who cares what your price is, you know, everything about whenever you talk to a CEO of a publicly traded company, whether it’s NASDAQ, or TSX, V, CSC or DC, all my share price, my share price, my share price, my share price, I haven’t seen a single offering in Reg A or write any of the regs where it’s, you know, you’re buying a 50 cent 50 cents 50 cents, it’s not about the price. So I think it is that’s the way you’re thinking you’re going to, you’re going to get them there. If you take them out of that equation in you treat it as a venue, and this venue is going to work with you, it’s not going to work against you. Meaning that if you need to raise capital, if I correct me if I’m wrong here, Lee that the company can actually halt the ATS platform from trading their securities once a company goes live with an offering. I’m correct on that.

Lee Saba  31:39

Yeah, so we, we can certainly talk about that. Right? You know, once it’s listed, for sure, you know, but if there is a if there is a need for a halt, we can we get we’re open to talking about that for sure.

Oscar Jofre  31:54

Okay, perfect. So there, yeah. So that these are the kinds of things that, you know, CEOs are thinking about, how do I utilize this venue, but always try to remember this in the back of your mind? You’re a private company, that’s not a public stock exchanges? Yes. It’s like, you know, I don’t want to it’s like a glorified bulletin board. But fully regulated, right? With all the protections that everyone needs, but more importantly, it’s good for you to provide that [uncertain]. Otherwise, you’re going to be dealing with a pressure. So when are you selling when you sell and when you’re going public, and you may not want to go public, you may not want to sell, I mean, how many times have all you know Scott Pantel brought up a great example earlier today. And, and sort of Stephen Brock that needs to be reminded to everyone, it not every company is a publicly traded company. This is it. This is you know, and I’m going to give it to you in numbers. Now, I’m only going to give you one number that is in the United States, this 32 million privately registered companies. Okay, so with COVID-19, I’ll chop away 2 million. Okay, so 30 million, and 30 million, and there’s less than 20,000 publicly traded companies trading, so it’s not for everyone. And the other companies are still raising money, they’re still staying private. And all you’re doing is providing a form of monetization for your investors so they can keep re putting that money back in the private world. And, and we that’s how it works. Not everyone needs to go that route. If that is your route, that’s fantastic, great, but you’re going to need capital you you know going public just being worth a billion isn’t enough anymore. Now you need to be worth 5 billion 10 billion to get the market awareness and everything so build it up while you’re private. That way you don’t have to spend the millions of dollars per year on governance and compliance to maintain that so I’m like I’ve been an entrepreneur for well won’t say how many years because you know, you’ll know how old I am I’m only 25 So the important thing is that it’s great to provide people an option that they know to be real if you’ve ever raised money there is if you when you are asked this question by an investor and they go so what’s the I just said oh, we’re going to get a roll ourselves into a CPC, and we’re going to find it in there’s 1000s everybody always says there’s always 1000 but when when it’s time to look you can’t find any it’s always oh my god it’s a pain in the body and and then the final deal everybody gets screwed except the diva excuse my language, but you know, I’ve been there done that. So I know firsthand how you get swayed into that model. And then in the end, you got nothing. Nothing Absolutely nothing to show for it. So and then the other model is where, you know, you’re going to sell the company Great. So fast and burn sell Great. So who’s going to be spending the time building the company, you know, growing the company, and, and I think that’s the way for me, it’s, you want to dump it, I’m not gonna be able to stop, you sell it. Okay, sell it, it’s done you so what 100,000 shares at half the price is that the is that the indicator, if the rest of the people aren’t selling, if you’ve got 30,000 shareholders and one sold is that the indicator that now I’m so it’s time to embrace the fear of the unknown. Because the fear of the unknown is that it is actually something that we can embrace gracefully. So I’m really excited. So thank you both. You guys were amazing. This afternoon, you guys close it up for everyone. Dr. Android there, with the background and Lee, I always enjoy our talks, you know, it’s never a dull moment, right from the stock symbol conversation to make it work for decentralized centralized identity, which is solving real problems. So for everyone else, I am going to, you know, you’ve all graced us with your, with your time this afternoon, you’ve taken the time to come and listen to the the whole process from A to Zed on how your company in the medtech Life Sciences sector can take advantage of this amazing, amazing regulation. And not only take advantage of this amazing regulation, but how does it all start, this is the part that a lot of people did not understand that there is a process to get it all started, there is things you need to go through. If you don’t, you heard one of the panel panelists, we had it earlier to say that if you decide to go to here, we’re gonna you know, we’re going to need to go back to here. So you know, I, I’ve been trying to get that hopefully to everyone here, this vertical is so special. It you heard every one of our speakers had an attachment to what all of you are doing, all of you are doing something so impactful. That it, it really made a big difference in the sector. So and what I’m trying to do now is just kind of closing all of you all for this afternoon, I want to remind you just, you know, as you review the materials that you’re going to receive, there is a there’s a deliberate process that’s been created for companies like yours, to be able to follow right from the, you know, having the earlier program with Stephen Brock, there, Stephen, he was in shock, he was just trying to get it reconnected, which is an important one, which Stephen brings to the table, to the sector is something that, you know, I’ll be honest with you, when I first saw what the Stephen was doing for his clients. At first, I wasn’t really all there. You know, like everyone, I, I’ll be honest with you, it’s just a matter of education. And now, you know, all of us around who have experienced this process with Stephen, we’ve, we’ve said to ourselves, you know what, it would be great if this was done by many of the other companies and other sectors. And one of the things that people often often forget to do is the process. And I know I heard Douglas Ruark say I heard Shari saying, I said I heard the people that KoreConX when the KoreTransfer site, we heard it from the investor acquisition from Scott Allen, and so on. But the process begins here. It needs to have a beginning in order for you to get properly started. And that is the the part that Scott and Stephen are providing. It’s a it’s a way for you to take all of those ideas and things you’ve been working on into properly structured, so it can materialize to something that the lawyers can submit to the SEC. And the auditors can audit and let’s not forget, investors can invest in. There’s nothing worse than saying I need money and they go and I’ve seen this I kid you not. I’ve actually seen this where companies are ready to raise money. They’re ready to go they got people lining up and then nobody Everybody look under the hood and say, Excuse me, guys, we got a problem here, we can’t take on the investor. What? Right so and that’s what, Stephen that what you’re working on helping companies bringing them on through the, it’s a six week program that you walk them through, just give us the high level points of it. So everyone remembers what they need to start with.

Stephen Brock  40:22

Thanks, Oscar, I gotta tell you, this was a fantastic presentation you put on your A plus team members, which are also part of our eight plus team members and presenting to the medical community has been fantastic having them involved with us and presenting to them, so that they can feel comfortable, and they can trust the process. And their experience and their direction. And how long they’ve been doing this for is just amazing. And I’m even doing for 12 years, I tell you, I’ve been able to meet you and involve the groups that you have pulled together has been so beneficial to the medical community, and they just don’t know it yet. They’re gonna learn by the educational aspects that we’re all putting together here. But what we put together was the Capital Planning valuation strategy, which many of the people that we’ve talked to in, were on the session today know about to some degree, and some don’t, but we will build that presentation, and at no cost and at no obligation, because we want them to win, and we want them to raise that capital that they deserve, especially as how hard they have worked. And so having the foundational platform of knowing where should our structure be? What’s our pre imposed valuation? What does it look like from a capital cash flow, cost presentation? Do we need a 506 C to be able to use as a stepping stone into a Reg A plus, financially. So all of that we will develop for them and go through our protocols as a registered investment advisor, I will get that foundation with my team built out and presented, and they will enjoy it because it’s an option that they have. And look, I agree with you venture, I’d hoped and I said this to Scott Pantel earlier on, I would love venture capital to get behind this and see it as a way for them to have less dilution to the original shareholder to the original shareholders and founders so that they have a bigger raise that they can do for them and have more people involved. And so it might benefit them to get behind Regulation A plus as a as a way to stepstone to even larger raises and show the founders, they want them to keep that passion. And to have that benefit of having more ownership, preferably more control, of course. But also getting VCs to embrace this, and use it as a tool that they show that they are in this with the founders as partners. And not just as people looking into avid exit and make that extra bill off of them. Get them as partners in the deal. Have them as partners in the deal. And everybody wins, look at it from a win win structure. And that would be super to have more VCs embrace this long term. And I think there’s a huge benefit to that if they could just tweak their viewpoint of allowing founders to have more. 

Oscar Jofre  43:51

I think we’re there. I really believe that the the numbers speak for themselves, right? I mean, I remember when, right, you know, the JOBS Act got introduced and people all you know, it’s just kiddie money. Well, we’re about to hit 1 billion with just one of the regulations. And the fact that Regulation A get increased from 50 to 75 million, tells you the regulators know that this is a regulation for the ment of biotech, Life Sciences companies real estate, so it’s no longer just for startups, not every startup needs 75 million on the first year. A company like this would so I’m I’m really excited and I think this was thank you for your comments. And but again, I cannot stress to everyone because we see this all too often you’re eager to get going with us. And we would love to have you on board. We want to get you started faster, but I’m going to tell you it’s like anything else. The fastest way to get to A to Zed is starting with a Okay, so make no mistake the fastest way to get to A to Zed is starting with a and Stephen Brock.

Stephen Brock  44:59

If you’ve got the foundational build out ready to present to the lawyers ready to present, the broker dealers ready to present to KoreConX, you actually will save tons of time. Because if you deliver this, let’s just call it a mess of documentation, well, then it’s really hard for them to get started. And then it has to go backwards again. And so why not just do it right from the get go, and you will save months of time. And that is what actually absolutely will occur. If they follow a foundational build out a roadmap, a way to stay in control, a way to raise the kind of capital that they did not realize was available to them. I can’t tell you how many companies think, well, we’re debating if we actually have a five or $10 million valuation, we do this presentation for them that lasts about an hour and a half after we’ve done our due diligence, and built the documentation out for them. It’s actually sometimes it’s $100 million valuation. And they go, what, Where’d that come from, I Oh, we didn’t develop it, the VCs developed it. That’s the new valuation stock times price. But we also have to make sure we take comparables into consideration off a pitch book, and what’s going on in their marketplace. So number of things have to be looked at. But let’s get that done. Now. Let’s not wait until you want to file at the SEC. And then we have to start over again and get it prepared for the lawyers and the auditor, the auditor needs great documentation before they even get on to the audit. And that’s from a legal perspective. And so that’s why you have two legal pieces involved. One is the foundational legal, that gets executed. And then the secondary after that is where Doug and RDR comes into play. And they get their piece done for the offering documents and either a 506 C, which they’ll prepare for the client, or just go straight to a Reg A plus or use the 506 C as the stepping stone into a Reg A plus. And the beauty of that is the 506 C is the majority of what’s going to go to the a plus. Because all of that works been done, except for you know, pieces like the audit etc. So I really appreciate Oscar being allowed to show the industry what you have developed in digital raise to raise and so many people don’t realize that’s available. And some of the old guards look at it and say, Well, I prefer the old way and going to meet people, you know, face to face. Zoom fixes that, in fact, I just talked to a potential client yesterday and she said, Stephen, I did my whole seed invest all on zoom. So that was really special to hear that they’re embracing the use of productivity features, and not having to go walk around people’s offices and shake hands and meet face to face. Because it’s almost the same thing as being able to use video, good documentation and due diligence back and forth. And hey, if you have to have that plane trip and meet, because that’s the way it is, then you do it. But many are not having to because they’re getting more comfortable due diligence in this way to get to the end result of a great capital raise. So I mean, what you’ve all put together and Oscar your KoreConX, it’s just, it’s stunning to me, where it’s all come from, from when I got into the industry, and where we are today. It is the most fun ever. And I just can’t wait until the people in the verticals that we work in can see that. And we’ll take the time to learn about it. And I hope you use it. Perfect.

Oscar Jofre  48:43

Well Well said. So we’re now down to the hour. And I just want to thank everyone once again for attending one of our amazing core KoreSummits bring the eight teams together. And this new exciting vertical, the medtech Life Sciences, biotech pharma. And thank you everyone. As a reminder, if you want to meet any of the speakers, just go to www KoreSummit.io. Click on speakers, you will see the speakers their bios, their LinkedIn link their email addresses, you will be emailed the information shortly as well about the event. And as well because it was recorded it will be available on YouTube channel for those who are registered. Once again. Thank you and stay tuned. We have five more KoreSummits to finish off 2021 there’s some exciting topics that could appeal to some of you as well. Till then, thank you and I look forward to seeing all of you very soon on your journey to getting your impact company brave. Thank you

Join the all-in-one platform empowering private capital markets.

Free forever, KoreConX makes it easy for participants in private capital markets to manage their investment portfolios, raise capital, and meet global compliance standards along every step of the way.

Book a demo
Join the all-in-one platform empowering private capital markets.
Free forever, KoreConX makes it easy for participants in private capital markets to manage their investment portfolios, raise capital, and meet global compliance standards along every step of the way.


Sign up, it’s free!   Book a demo