Frequently Asked Questions
Check our FAQs to get more information about Vireo structure, Vireo Products and Vireo services.
The Ethereum token standard (ERC20) is used for Ethereum smart contracts. Developed in 2015, ERC20 defines a common list of rules that an Ethereum token has to implement. Giving developers the ability to program how new tokens will function within the Ethereum ecosystem.
Vireo tokens will be an ERC20 on the Ethereum blockchain.
Blockchain is a distributed database that doesn’t have storage devices connected to a shared server. This database stores an ever-growing list of ordered records, called blocks. Each block contains a timestamp and a link to the previous block. Blockchains use cryptography to process and verify transactions on the ledger, providing comfort to users and potential users of the blockchain that entries are secure.
A distributed ledger is a database that is consensually shared and synchronized across network spread across multiple sites, institutions or geographies. … Underlying the distributed ledger technology (DLT) is the blockchain.
Vireo solution will be deployed in the blockchain to benefit from the advantages of the DLT.
A smart contract is a program code that allows you to automatically perform certain functions when certain conditions occur. To implement smart-contracts, a decentralized environment is required that completely excludes the human factor. To use the transfer of value in a smart-contract, it requires a cryptocurrency.
Vireo solution will use smart contracts to ensure transparent, secure and efficient transactions of value.
There are many definitions and words that have emerged to describe the crypto space. The term cryptocurrency or crypto is a broad categorization that describes digital currencies, digital assets, coins, and tokens. There are equity tokens, security tokens, and utility tokens; the type of digital asset has important legal and financial implications.
In the sense of Vireo token and Vireo Products, cryptocurrency (or crypto-currency) is a digital asset designed to work as a medium of exchange that uses cryptography to secure its transactions, to control the creation of additional units, and to verify the quality and the transfer of assets. Cryptocurrencies are a type of digital currencies, also know as alternative currencies and virtual currencies.
Cryptocurrencies use decentralized control as opposed to centralized electronic money and central banking systems.The decentralized control of each cryptocurrency works through a blockchain, which is a public transaction database, functioning as a distributed ledger. Cryptocurrencies thus are monetary units (also known as “coins” or “tokens”) protected by cryptographic technology. There is no physical analogue to these monetary units, they exist only in virtual space. Tokens are protected from forgery and secure, because they represent encrypted information that can not be copied (the use of cryptography defined the prefix “crypto” in the title).
More in Wikipedia
More in: Difference between coins and tokens/
More in: 3 types of ICO tokens/
A Security Token Offering (STO) is a mechanism for raising funds, under the terms of which future tokens are sold for liquid virtual money. You pay with crypto-currencies (e.g. bitcoins, ether, ripples, etc) or FIAT currencies (e.g. USD, GBP, EUR, etc.) during the token sale, and in return receive security tokens of the new project (here, the Vireo Tokens). This is another realization of the crowdfunding model. The participants finance the company’s development now in order to obtain from it some benefit in the future.
Pre-sale, also called pre-STO, is the stage before the security token sale. The pre-sale is conducted to test and verify the demand for the project, get support from the community and expand the budget for marketing before the main STO.
Vireo solution is ahead of the curve and takes into account current market concerns regarding definition of tokens and its regulation.
While most digital currencies currently available in the market define themselves as ‘Utility Tokens’ (meaning that their use is intrinsic and necessary to access the system they pretend to create, like a chip in a casino), in many cases they are clearly linked to promises of future financial rewards or financial security. This means that these so deemed “utility tokens” are in reality financial investment products (i.e. securities, or security tokens).
Therefore, any company dealing products that promise future returns should consider these products as financial instrument that fall unders securities regulations, and thus it shall be registered and have the appropriate licenses to be able to conduct its activities (the asset management license in the case of Vireo).
Being registered is a legal requirement to ensure quality and control over the services and products that Vireo will offer. For example, Vireo will have to justify/validate its valuation methodologies, ensure accounting and transactions for all activities, report yearly activities, ensure compliance with marketing guidelines fixed by regulations, etc.
Being regulated has no impact on the business model itself; meaning neither the potential of the business nor the returns generated by the business will be affected. Therefore, Vireo Products will be able to generate capital gains in the same way as other alternative digital currencies; the difference will reside in the transparent valuation of the security behind these products.
Vireo has a functioning beta version of the trading platform, a sound business development plan, strategic partnerships to implement the business plan and a strong network of green project owners, project developers and project validators (network being developed since 2014 and spread globally, with a focus across Southeast Asian countries). Vireo is currently seeking funding to:
- Register Vireo Investment Management (IM) in Singapore
- Establish Vireo Asset Management (AM), acquire the adequate licenses and be registered
- Automate the valuation platform and connect our systems to the blockchain
- Get projects validated by accredited third parties
- Seal agreements with third party auditors who will be in charge of validating Vireo cash flows (in and out), and compliance with our internal policies
Vireo Token sale has been scheduled for May 3rd, 2018.
Vireo will issue 23,500,000 Vireo Tokens, of which 16,450,000 Vireo Tokens will be available for sale. The remaining Vireo Tokens will be kept for the management team (5,405,000 tokens) and for PR / marketing (1,645,000 tokens). No other Vireo Tokens will be issued in the future.
Soft cap: SGD 1,000,000
Hard cap: SGD 5,000,000
The exchange price between Vireo Tokens and alternative digital currencies will be fixed at the time of the Token sale. However, because Vireo is a strong believer and supporter of the blockchain, Vireo will offer an additional 10% discount to participants buying Vireo Tokens with digital currencies.
The number of Vireo Tokens received will depend on the tranche of the token sale that you will participate in (check our tokenomics for more details).
For example, if at the time of the Token sale ETH/SGD price is SG$ 1.100 whereas current price of Vireo Tokens is SG$ 0.35, for 1 ETH a Vireo token buyer will receive: (1.100 * 1.10) / 0.35 = 3,457.14 Vireo Tokens.
To purchase VIREO Tokens, you will undergo our know-your-customer (KYC) process and answer some questions to make sure that you are a qualified investor. Indeed, acquiring securities requires a minimum knowledge about investments and financial products, so non-qualified investors will not be allowed to purchase our Vireo Tokens.
VIREO Tokens can only be purchased in two ways:
- Using accepted digital currencies already available on crypto exchanges, that are already liquid enough and for which the market quotation is representative of a real exchange rate. As such, we will be able to only accept the major cryptocurrencies, such as Bitcoin (BTC), Ethereum (ETH), LiteCoin (LTC), BitcoinCash (BCH), Neo, NeoGas, etc
- Using standard FIAT currencies such as USD, EUR, CHF, GBP, etc. You will be able to buy Vireo Tokens by transferring cash directly to Vireo; however, you should know that:
- If you transfer cash to get Vireo Tokens, you will still need to have an e-wallet (for which you know the private key) so that we can deliver the Vireo Tokens
- Transferring cash using your credit card will cost you a transfer fee (depending on the conditions set by your credit card provider).
VIREO Tokens are Ethereum-based ERC20 tokens. Token holders can easily store and manage their VIREO Tokens using existing Ethereum clients, including the official Ethereum wallets (Mist, MyEtherWallet.com) or other ERC20 compatible ETH e-wallets like Parity, Trust, Metamask, Lykke. Other ETH e-wallets like, Exxodus, Coinomi, etc. will still be able to store your Vireo tokens, but will be more difficult to manage at the moment, so we don’t recommend them for storing your Vireo tokens after purchase.
Of course, whenever possible you should store Vireo tokens in a hardware wallet (like Ledger Nano S or Trezor). Hardware wallets have built-in Ethereum support, so the firmware won’t need to be updated to support Vireo Token (or any other ERC20 token). Instead, it will all be taken care of through MyEtherWallet, which serves as a user interface for hardware wallet owners looking to store and spend ERC20 tokens. The additional security provided by hardware wallets should never be overlooked, as hackers will exploit any and all weak security measures that users may put in place.
More info on ERC20 compatible wallets here.
No, since the VIREO Tokens are released on the Ethereum blockchain, you will need an Ethereum address to get and store VIREO Tokens. You must use Ethereum wallets in which you have access to your private keys.
IMPORTANT: Don’t send your digital currencies from the accounts of exchanges to participate in VIREO Token sale. You don’t have access to private keys of your crypto-exchange accounts, so you won’t be able to access to your VIREO Tokens!
To limit the effect of transaction fees, the minimum transaction amount has been set at SGD 50.
Yes, Vireo has a bounty program. However, because Vireo Tokens are deemed security tokens, we need to make sure that people who want to access the bounty program have sufficient qualification and a sound understanding of financial instruments to promote our Vireo Token and benefit from the bounty program. For more details or if you are interested, please contact us on LinkedIn or by email at email@example.com
Funds will be used to launch Vireo Investment Management and Vireo Asset Management, the 2 key entities that will set in motion and manage Vireo ecosystem. Around 23% of the funds will be used for salaries (development of Vireo platform, automation of the valuation tool). The rest of the funds will be used to run daily activities, namely:
- Third party review and validation of projects in pipe, following international standards, to ensure maximum security for investments: around 41% of the funds
- Marketing (Vireo Seed ICOs promotion): around 9% of the funds
- Marketing promises: around 8% of the funds
- Legal costs for preparation of Vireo ICO and daily activities: estimated around 4% of the funds
SEEDS, CROPS AND PROJECTS
Seeds are Security Tokens that we can assimilate to digital fund shares; they are issued for early stage investment in green projects. Investors who wishes to acquire Seeds will be able to select which green project will be financed and, once the financing level for a project is reached, Vireo IM will proceed to project acquisition.
Seeds will be issued in a limited number, at a minimum price of 1USD, and maximum amount to be issued is equal to 1,500,000,000. The final amount of Seeds to be issued will depend on its market value; for example (check Vireo financial projections for more details):
- At 1USD per Seed, Vireo AM will issue 1,500,000,000 Seeds
- At 1USD per Seed for 1st issuance and 2USD per Seed for next issuances, the number of Seeds to be issued should be equal to 865,000,000
Non-issued Seeds will be burnt when Vireo AM will have reached critical mass.
Seeds can be used to acquire green projects to be developed or running projects. When green projects will be operational, Vireo AM will proceed to the sale of these green projects, via the issuance of Crops (project digitization), and will generate some cash that will serve as security for the Seeds. The accumulated cash at Vireo AM will be used to re-invest into new green projects and to issue more Crops.
Seeds holders will be entitled to receive 5% free Crops at each new Crops issuance. Of course, these Crops will also receive digital interest (the CropYield).
Seeds will be tradable and Vireo will assure minimum liquidity. Seeds value will be based on the value of green assets held by Vireo AM as well as on the accumulated cash arising from the green assets. The accumulated cash will be subject to foreign exchange risk, but Vireo IM will be in charge of covering this risk (refer to Annex I)
More details about the Seeds in Vireo White Paper Phase II.
Crops are Security Tokens and true digital assets backed by physical green commodities. Crops will be issued when Vireo AM digitizes green assets to be marketed to impact investors who prefer to invest in less risky, long-term and more stable investments. Crops will represent a portion of one or more green assets that will be producing green commodities.
As underlying green projects are producing green commodities, Crops will pay an equivalent digital interest, the CropYield, on a yearly basis. The CropYield will be computed based on the quantity of green commodities produced and therefore, because we value the quantity of green commodities produced, the CropYield will not depend on Crops FIAT market value.
Thus, if a Crops is paying a CropYield of 3%, an investor who has 1,000 of this Crops will receive 30 new Crops, whether the Crops market value is US$ 100 or US$ 1,000. Because Vireo AM will pay CropYield, the cash received from the projects will be kept by Vireo AM in order to (1) create a cash security for the Crops and (2) re-invest cash as soon as a new green project (duly validated) can be financed, in order to maintain a perpetual investment mechanism.
Crops investors will be able to choose between 3 different type of Crops (check Vireo White Paper Phase II):
- Project Crops: investment in a specific project that investors will have selected. Project Crops have a limited lifetime, equal to each underlying project’s maturity. Project Crops investors will have the option to encash their investment at maturity or reinvest in other Vireo Products
- Group Crops: investment in a pool of projects (e.g. wind farms, all type of projects in a specific country, etc.). Group Crops have no maturity and will remain as long as there are underlying green projects generating green commodities
- Global Crops: investment in all the green projects owned by Vireo AM. Global Crops have no maturity and will remain as long as there are underlying green projects generating green commodities
Crops will be regularly valued using latest project production information (monthly) and updated financial risk information (weekly or monthly). Therefore, the regular updates of Crops Value, should facilitate the exchange of Crops on the secondary market. Vireo will assure a minimum liquidity for the Crops.
Investors (such as insurances, private and commercial banks or individuals) will be able to acquire these projects as secure long term investment or as a remunerated cash account.
To ensure minimum return on Crops, Vireo IM has set a remuneration policy based on the performance of Crops. Below a 1.5% CropYield, Vireo IM will not charge any fee to the related Crops (check Annex II for more details).
More details about the Seeds in Vireo White Paper Phase II.
Vireo Certificates are regulated financial instruments that will be sold to financial institutions and corporate that cannot hold digital assets on their balance sheet. Through the certificates (which will are off balance sheet entries), these “traditional” investors will be able to place their cash directly into a project and receive, via the Certificates, the cash flows from the projects (either when sold during or acquired after digitization). The scheme will be basically similar to standard fund shares.
The difference resides in the fact that Certificates will also offer a free embedded option to traditional investors, as Certificates will be indexed either on related portion of Seeds or Crops, and, when cash flows will be executed, Vireo will leverage investors’ returns using Crops and Seeds capital gain between Certificate Start Date and Payment Date.
Check Vireo White Paper Phase II for more details
CropYield represents digital interests generated by the Crops, every year, payable to Crops holders in Crops either every 6 months or every year. The CropYield will be computed using all green projects’ performances so that less profitable projects can be compensated by stronger projects to (1) enable less profitable projects to be realized and (2) to guarantee more security / stability in project returns. In order to remain conservative and to anticipate most of potential negative impacts, the CropYield will be calculated using conservative valuation parameters, that will aim for a lower, yet realistic, forecast of CropYields; for example:
- Valuation model will consider only negative project degradation impact on project production capacity
- Valuation model will consider only negative climate change impact on project production capacity
- Valuation model will consider only negative Foreign Exchange impact on project revenues
- Valuation model will alway consider minimum operational expenses and project maintenance, even if revenues drop drastically
A risk estimator (0 – no risk – to 100% very risky) will be regularly provided to indicate the relative risk related to each investment.
As Crops investors will choose the green projects to invest in, Crops investors will intrinsically define the Corps monetary policy, and all investors will be able to enjoy the same transparent monetary policy.
Vireo is a disruptive solution which will offer a new financing environment to people and will disrupt financial institutions which are promoting speculation and debt creation, and that are failing to support the real economy.
The Vireo ecosystem affords investors direct access to significant sized green projects and direct benefits arising from these investments. Due to minimised operational / intermediary costs, and the innovation of new class of financial instrument that are based on the value green commodities, Vireo will be able to offer attractive financing solutions to green project owners whilst providing attractive returns to impact investors.
Vireo wants to set a very high standard for green project validation. Vireo will collaborate with green experts to vet the projects, applying World Bank and Asian Development Bank standards. By limiting the construction / default risk from projects and ensuring full compliance with green standards, we expect to reduce the risk premium for investors. In addition, Vireo will split investors to lower financing costs on the long term:
- Early investors, higher risk taker, will invest into Seeds. Seeds will serve higher returns but only on the construction period of each project
- Long-term investors, lower risk taker, will invest into Crops. Crops will serve more reasonable returns as there will be no construction risk anymore and very low default risk (to cover country / political risk, Vireo will purchase insurance whenever required), and therefore it will lower the financing costs. Crops will remain valid while its underlying green projects are running and the Vireo structure composed of Debt and Equity returns enables to lower financing costs at project inception
Therefore, the system will create a virtuous circle where attractive financing solutions will enable Vireo to attract the most promising projects in compliance with Vireo high quality internal standards; promising projects will attract more investments… Finally, thanks to liquidity and benefits of the blockchain, investors will be able to use Vireo AM as a green decentralized cash account, remunerated based on real green commodities produced by Vireo green assets.
Seeds and Crops are part of the smart green economy and they are the instruments of a new financing system, supporting green development. They will contribute to sustainable and inclusive economic growth for those who are left aside by the current financial system.
Seeds and Crops are real digital assets, backed by real green assets and cash. They will be stable, liquid instruments, regularly audited, valued and offering steady, attractive returns. Thanks to Seeds and Crops, impact investors will be absolutely sure that their money will be invested only in green projects of their choosing, as all project details, fund flows, transactions and project follow-ups will be disclosed online. Furthermore, as Seeds and Crops will be digital assets, investors will be able to trade / redeem their investments at their convenience, using Seeds and Crops like green deposits.
The more projects Vireo acquires, the more stable and secured the Crops and Seeds value and brand will be become. Therefore, the more investors will trust in the Seeds and the Crops, the more Vireo ecosystem will become secure and strong, attracting promising green projects while offering equal investment opportunities to everyone to fight against climate change.
- Why Seeds are secure Tokens?
First, Seeds will be backed by Vireo AM assets under management and by cash accumulated by Vireo AM activities.
Vireo commits to validate each project in compliance with best international standards and using accredited third parties. Furthermore, no cash will be delivered to project developers if project development milestones are not respected (all cash flows will be validated by external auditors and will be disclosed online). In case delays or project costs are increased due to unexpected structural issues, Vireo will partially cover these extra costs to ensure that project doesn’t default.
- Why Crops are secure Token?
First, Crops will be fully backed by real green assets, producing green commodities, and by cash. They will be regularly calculated by Vireo IM and all information will be disclosed online:
- Value of assets backing each of the Seeds and the Crops
- Conservative return forecast (check Annex II for more details about valuation):
- Always using the latest project and financial data
- Using conservative risk approach to anticipate most of potential future negative impacts or unexpected events
Thanks to its wide range of products, the flexibility offered by Vireo Products and Vireo validation process (compliant with most financial institutions’ requirements), Vireo will be able to target the full spectrum of investors:
- Financial institutions
Vireo has defined a strategy to approach these different client segments as each type of investors will look for specific features in their investments.
There will no impact on Seeds and Crops. The impact will be at Vireo level, as Vireo will have to comply with securities regulations; which means more security for investors.
Therefore, there will be no impact for investors, except the guarantee that regulations will protect them.
As the price of Seeds and Crops will be controlled by the market, and not by Vireo, Vireo cannot provide any reliable information. However, if Vireo solution becomes popular and if volumes are increasing accordingly to Vireo business development plan, the value of Seeds and Crops is expected to increase.
Vireo will raise cash and store cash using the major FIAT currencies to limit the exposure to FIAT currency risk exposure. The first basket of currencies will be:
The basket of currencies may evolve in the future, depending on Vireo FX hedging models AND depending on the reference currency that Vireo will choose to evaluate all cash flows.
The reference currency is defined using the criteria below:
- Currency used to quote most of Vireo projects (construction costs, project revenues)
- Most stable currency within the basket of currencies
- Currency preferred to exchange local currencies
- Most liquid currency
Objectives of FIAT currency hedging are:
- Lowering the risk of currency devaluation and that Vireo will not be able to finance a project
- Lowering the risk that local revenues deflate
Thanks to advanced banking models, Vireo will be able to hedge this risk through its FX trading operations or by using some financial institutions to provide security to Vireo.
For each green project that helps to reduce carbon emissions (or, more globally, GHG emission reduction), Vireo will regularly provide a forecast of yearly CO2 emission reduction as well as the current effective CO2 emission reduction (in metric tons).
While the CO2 emission reduction forecasts will incorporate the risk factors of the valuation model (i.e. forecasts will be conservative, as aligned with the CropYields forecast), the current effective CO2 emission reductions will be based on real project performances and will thus correspond to real CO2 emission reduction. Crops will provide direct measure of CO2 emission reduction.
Then, there will be 2 ways for investors to benefit from this CO2 emission reduction:
- Through the Crops market price: corporates / industries or individuals willing to reduce their CO2 footprint will be able to acquire Crops, knowing that Crops will also represent a placement for these investors (thus, acquiring CO2 credits will become directly profitable). These investors will have a positive impact on Crops market value, as demand should increase price of Crops.
- Through carbon credit trading: Vireo works with some carbon trading partners (such as AERA or CRX) who will manage carbon credit trading on behalf of Vireo. The carbon credit benefits will be returned to Crops investors who agreed to sell their carbon credits
To avoid double counting of carbon credits (e.g. an entity declaring CO2 carbon emission reduction because it holds Crops, whereas this same entity is willing to sell the carbon credits through carbon credit market), Vireo will work on issuing specific carbon credit certificates to Crops holders who are willing to trade or directly benefit from their carbon credits; and these certificates will be traded or used to justify a real CO2 emission reduction.
Seeds and Crops backed value will be composed of:
- Green assets; and
Regarding the green assets, the value will be equal to the Net Asset Value (NAV) of each projects; roughly, Vireo will use future free cash flows methodology to evaluate NAV.
For the Cash, Vireo will create a FX trading department which will be in charge of assessing foreign exchange risks and covering / hedging such risks using our advanced FX models (check Annex II for more details).
The value of the assets backing the Seeds or each Crops will be equal to the NAV of respective underlying green assets + respective cash amount.
The value is driven through the selection of green projects by impact investors to be admitted (through investment) into the Vireo green economy and managed by the monetary policy algorithm governing the global CropYields for the entire Vireo ecosystem. The monetary policy is in turn influenced by the growth of projects admitted into the Vireo ecosystem reinforced by our continuous, burgeoning and reliable pipeline (see FAQ on continuous pipeline) and the financial efficiency of green commodities currently in production.
Check Annex II for more details
All the projects which will be on Vireo AM platform should be ready to start; which means that, as soon as a project can be financed, Vireo will start the administrative work, using legal office, to seal the contracts, terms and conditions to start the financing. A 1 month to 3 months period is to be expected from the closure of Seeds STO and a project start date.
Each project will go through Vireo IM selection process. Vireo IM selection process consists in (1) a first internal review (through EPC and Vireo staff – including the financial analysis) and (2) an external review from accredited third parties (accredited means ISO certified companies with significant track record in green industry – preferably with experience working with multilateral institutions). All reviews and analysis will be disclosed online, and available to all investors.
Once projects will have been duly validated, Vireo will go through a light investment committee, composed of external and internal Vireo members, to make sure that all aspects of the green projects have been duly validated and are ready to be financed. All projects with a forecasted Yearly Effective Crop Return (YECR) below 1.5% will be automatically eliminated (check Vireo White Paper Phase II for more details about the YECR) because of Vireo revenue model (check Vireo Annex II for more details).
During construction period, cash will be transferred to project developers if and only if projects meet development schedule and milestones. To make sure that all cash transfers will be justified, Vireo will work with independent third parties who will:
- Follow-up project developments and validate progress
- Control expenses compared to the original Bill of Quantities
- Ensure that all cash flow in and out of each projects are justified
Vireo will avoid as much as possible from transferring big amounts and will always ask for invoices to justify any cash transfer.
Therefore, no project developer will be able to “run with the money”, any unjustified expense should be extremely limited and any construction issue will be identified before cash is misused. As soon as a project will encounter an unexplained issue, Vireo will cease cash transfers to this project to avoid loss of cash.
To assure the proof of assets, all projects will be monitored / reviewed by independent third parties, all information (whether good or bad) will be disclosed online with no control of Vireo over the information.
After project completion, Vireo will remain at the board of each projects with Veto right or management control whenever possible (basically, whenever Vireo will be major shareholder in the projects) and will require that all project will be reviewed by international audit companies (no local audit companies or officers will be allowed to avoid collusion issues). These third party auditors will be paid directly by the projects to avoid collusion issues between Vireo and auditors.
Assuring quality of the projects is key for Vireo, as Vireo will also be remunerated based on projects performance. The Vireo solution has been designed so that Vireo will have the same concerns as investors on project quality.
All transactions and projects will be audited and validated by independent third party auditors, who will be responsible of disclosing the information online.
During project construction period, Vireo will require the validation from these independent auditors in order to perform a cash transfer to a project. All transactions will be yearly reviewed during yearly accounting audits.
Vireo cannot guarantee that all projects will be duly completed; however, Vireo will make sure that any project will have minimum risk and that project defaults remain very rare (Vireo’s objective is 5% maximum default probability as a worst case scenario – with a realistic 3% default probability).
With Vireo being paid on project performance, both Vireo and investors will share the same goals: only through project operational success and ensuring that all projects can be completed.
2 types of risk shall be identified:
- Construction risk; and
- Political / country risk
Regarding the construction risk, Vireo will implement specific procedures to ensure that any project being financed is reliable and feasible, and that only limited amount of cash will be lost in case a project turns bad.
Regarding the political and country risk, 2 sub cases:
- Distribution and economic risk; and
- Political risk
To cover political risk, Vireo will acquire insurance whenever it will be deemed necessary.
To cover the distribution / economic risk, Vireo will make sure that all our projects will be linked to national grids or significant / reliable local distribution networks. All projects should be justified by a recent market study that can support project necessity. If projects cannot be supported by reliable / satisfactory market survey, Vireo will always require guarantees from local administration / government to cover distribution risks.
However, if economic problems turns global (financial crisis or global country economic turmoil), Vireo will not be able to guarantee any security for impacted projects’ revenues and any case will be managed on a case by case basis. The advantage of Vireo business model is that Vireo AM will remain owner of the projects as shareholder.
Our current projects in the pipeline are ready to go – our EPC partner has raised some points to be double-checked to ensure better project security, but globally all projects went through a first validation round compliant with international standards.
Thanks to Vireo network and because Vireo ecosystem should attract promising green projects, Vireo will be able to get continuous feeding of project pipeline; more particularly because:
- Renewable Energy market is worth 15 trillion dollars
- Current needs in green production capacity increase in emerging countries is really significant
- Needs for equal and inclusive developments in emerging countries are really significant
- Developed countries will have to go through energetic transition to give up fossil fuels (refer to the Paris agreements)
More information and links are available in Vireo White Paper.
It will depend on project size and interest of other investors to co-invest with Vireo. Co-investment means risk dilution and investment leveraging. There is no rule but any financial structure will be disclosed online so that investors will be able to see who are the different investors in any project and if Vireo is the sole investor or not.
VIREO ORGANIZATION, DUTIES AND PROCESSES
VIREO LLP is registered in Singapore. After Vireo token sale, Vireo IM will be incorporated in Singapore. Vireo AM will registered as a Special Purpose Entity managing Vireo Asset Management platform and will be incorporated, for example, in Mauritius, Cayman Island, Singapore, Guernsey or Luxembourg.
Vireo IM will be registered as a standard Limited Company, with the capacity to do investment management, and Vireo AM will be registered as an Asset Management company.
Vireo ecosystem is the combination of Vireo solution (Vireo IM, Vireo AM and its respective Products and Services) and the participants to it, including global impact investors, local green project developers, all Vireo partners that interact with the solution (by providing or receiving services, products or rewards), and of course the larger Vireo community.
Vireo AM will be the platform where Seeds and Crops will be issued (respectively to acquire/build and to sell green projects).
Vireo IM will be the entity supervising Vireo AM as well as the entity in charge of Vireo Services: project vetting, investment analysis, valuation of Vireo Products and their related securities: green projects acquired and built with the Seeds, and the green commodity produced by the projects that will generate cash and that Vireo will digitize via the Crops Sales.
Thanks to Vireo IM and Vireo AM, Vireo will be able to attract promising green projects and instill confidence amongst global impact investors regarding the quality, reliability and performance of the offered investments. Having a loyal customer base of impact investors ready to participate in the green digital revolution through Vireo AM platform will in turn attract more and more local project developers to benefit from Vireo’s innovative financing solution.
Refer to Vireo White Paper for more details
Traditional green financing solutions (other than emerging green crowdfunding solutions) can be separated in two categories:
- Public financing, such as financing provided by governmental institutions or institutions that are representing governmental institutions (some aid agencies or green multilateral entities). By nature, the source of funding in this case is governments and requirements in terms of returns is much lower than private financing. However, in general, processes to go through to get public financing are long and restrictive.
- Private financing, are coming from private institutions which do not necessarily have political interest or social development policies. These institutions will focus more on returns and security, and do not emphasize on human benefits of investments. In all cases, these institutions have a pure financial approach of investments and charge significant margins to (1) cover their significant operational costs and (2) cover the loss of opportunity for the cash they cannot place. Furthermore, for private institutions supposed to invest exclusively in green projects, they do not have skills to properly assess such projects they and as such will miss opportunities and compensate potential losses by investing in non-green projects without disclosing to investors.
Public financing is oriented towards social developments; however, processes and conditions to access such financing are so demanding that only governments (who are not in hurry) will dare asking for public financing. Which means that only with large projects, do governments benefit from public financing. For other projects (micro to medium size, privately owned or private / public ownership), the only possibility remains private financing. However, such financing are not compatible with green projects.
Vireo will be a link and a nexus between public and private financing. Vireo will collect money from investors only when green projects will be duly vetted and ready to start (all information will be online – check our pipeline); Vireo will then apply minimum friction to ensure the cheapest financing solution for local project developers while giving back maximum returns to investors (those investors can be retail investors who usually do not receive any benefit when they deposit their money into their current/saving bank account, whilst it is used to be invested in projects / financial products / deals of which consumers are unaware and could be very risky).
Vireo projects will adhere to the same standards as required for public financing (for security) and Vireo will provide bespoke financing solutions to ensure project feasibility and profitability, with the efficiency of private financing. To offer profitability, Vireo will bet on long-term investments and revenues optimization, rather than going for short-term investments that aim to maximize revenues.
As a conclusion, Vireo is re-creating an ecosystem where long-term and stable profit is preferred to support real economy and green development. All our projects will remain profitable due to low operational costs (maximum returns for investors and no sleeping cash) and long-term Debt/Equity stakes in our investment structure (returns calculated over decades).
Leveraging the digital asset feature, investors will be able to exchange Vireo Products whenever they want – i.e. same principle as withdrawing cash from a bank account – and for the amount they want. There will be no volume / amount restrictions such as for other placements offered by financial institutions.
As a concrete example, thanks to Vireo structure and new value referential (Vireo Products are valued based on green commodity – check Annex II for more details about valuation principles and our project pipeline for examples) Vireo will be able to offer financing solutions at less than 3% costs for project owners, but with:
- more than 2.5% p.a. Average CropYield for Crops investors, for more than 20 years; and
- 5% to 10% return on cash backing the Seeds
Last, to ensure the best service quality, Vireo will beremunerated based on a performance fee policy. Below a CropYield of (1.5%) for a Crops, Vireo IM will not charge its annual management fee on this Crops. This principle ensures that Vireo will always act faithfully and with the commitment of delivering quality to its clients (check Annex II for more details).
Crowdfunding solutions do not offer innovative financial instruments such as Vireo Products, where there is strong interaction between projects, payment of digital interests and possibility to customise investment portfolios.
Furthermore, such platforms do not apply international standards, industrial best practices and cannot guarantee strict compliance of projects with the best standards. Therefore, as there is no independent validation process, projects offered on these platform may be risky; leading to bad reputation for other crowdfunding platforms or initiatives that handle the necessary measures to duly vet projects.
Then, in most cases, usual crowdfunding platform cannot offer liquidity (possibility to buy or sell easily the related investments) as they don’t offer valuation of investments. Vireo, thanks to its unique valuation tool, will be able to offer investors a full comprehensive financial analysis and regular valuation reporting to facilitate tradability of Vireo Products.
Vireo Tokens are meant to enable the participation of Vireo community in Vireo IM. Initially they are equity tokens similar to shares with access to dividends but no voting rights. Vireo intends to convert part of Vireo Tokens into Vireo IM shares: buying back Vireo Tokens and burning them in exchange of equivalent shares in Vireo IM. Vireo will start the Vireo token buy back program as soon as Vireo’s operations and volume allow (refer to White Paper Phase I for more details).
Vireo Tokens will pay dividends based on Vireo IM revenues. The more Vireo is able to expand the more Vireo Tokens will pay significant dividends. If Vireo IM can meet its development objectives, it has been estimated that Vireo Token value could be multiplied by 14 within 4 years (considering the potential future value of dividends) and would offer a 10 years Return on Equity at 27% per year (check Vireo financial projections for additional details).
These figures are based on Vireo assumptions and would be realized only if all Vireo assumptions are accurate. Investors shall not consider the figures above as guaranteed future prices or returns, and they should make their own analysis to estimate Vireo Token potential.
The current financial system and available financing solutions are not designed to address green development, particularly in emerging economies. Thanks to Vireo, local green project developers will have access to a new financing channel that will offer them attractive financing solutions while respecting best international standards and requirements for project validation, and keeping efficiency in delivering project development & financing services.
Globally, the Vireo ecosystem will act as the development bank for local green project developers funded by the global impact investment community (digital and digital-friendly via Certificates).
Vireo solution is strongly complementary with existing and emerging distributed green energy solutions on the blockchain. While existing solutions focus more on energy distribution, Vireo solution will focus on financing green asset production for micro to medium size privately owned green projects. Cooperative solutions may rise with such existing ventures, as green energy produced & tokenized by Vireo can be easily distributed & re-tokenized by other existing distributed energy solutions.
Vireo solution could become complementary with existing and emerging social tokens, which could help to complement or expand Vireo company value by adding digital monetization of additional benefits while sharing the projects and customer base. In addition, Vireo can also collaborate with other securities and financial tokens to facilitate payments, enhance liquidity and improve tradability (such as listing on existing digital exchanges).
Vireo will become a reference in green financing. Therefore, green projects that will be securitised on Vireo platform will automatically be benefit from the Vireo brand, bringing confidence to investors and offering a greater possibility to access attractive financing solutions.
Furthermore, Vireo will help project owners to raise the quality of their projects, through technical assistance, to reach the international standard level required by Vireo. One of Vireo’s objective is to help to transfer knowledge and skills to project owners with small capital capacities, and create a community of dedicated and like-minded people acting for real sustainable development. This objective will enable the local population to reach higher operational and construction standards and therefore reduce project costs.
We need to empower local project owners and help them to reach higher standards to create the virtuous circle that will boost green development.
Vireo will welcome any green project that complies with international standards for green development (low carbon emission, no corruption, inclusive growth / support to local economy, women empowerment, etc.).
Though Vireo model is flexible and enables to optimize financing structures to make all projects attractive, Vireo will not accept non profit generating projects; all projects that Vireo onboards shall have economic rational.
Then, all projects that meet Vireo criteria, and that successfully confirmed by our validation process, will be offered on Vireo platform. From there, Seeds investors will choose which project will be financed.
Therefore, profitable projects may be financed, but also less profitable ones that have probably stronger impacts on society. Vireo will not fix any guidelines on which project shall or shall not be financed; Vireo will only guarantee that all projects are feasible and compliant with international green development goals and standards.
Have credible/realistic/promising green projects and be ready to comply with international standards.
Check our current pipeline for examples
Vireo will be in charge of managing the transaction. As such:
- Both Seeds and Crops investors, when investing into the Seeds and the Crops, will automatically appoint Vireo as the entity in charge of managing Vireo assets
- Vireo will therefore have direct access to the funds that projects collect
However, Vireo will be regulated and will be audited every year in any jurisdiction where Vireo holds green projects. Therefore, all information regarding Vireo operations will be fully disclosed and accessible online.
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