Crypto & Corks — How $RCGR’s Holding Company Status Hedges The Crypto Uncertainty

  • Company announced its involvement in cryptomining this past December
  • Simple Cork appraised at a “fair value” of over $12.4 million
  • 36 billion bottles of wine are sold each year
  • Company currently trading at only 1/6th the Simple Cork appraisal alone
First Intercontinental Technology (OTC:Pink RCGR), formerly Rich Cigars, offers investors, who love the latest and greatest “cryptocurrency” sector, a bonus of sorts or an insurance like policy (hedging) by being a Holdings company. This gives tech investors a taste of the crypto world, in addition to holdings such as RCGR’s recently announced Simple Cork asset purchase.
The advantage of investing in a holdings company is simply “less” risk. Investing in most companies, puts you in a position where you either win or lose. In the small cap space, most businesses are start-ups and if you know the business world, you know that odds are against them. With a holdings company that is well diversified, meaning their business are not all in the same sector, it allows a hedging of your bet. If one business fails, you do not lose all your money or investment as there are other assets or businesses within the portfolio of holdings still in play.
With RCGR, skeptical crypto investors can find comfort in knowing that if the sector goes “belly up”, which I personally feel is not the case, they still have the vast potential of Simple Cork. If crypto continues to grow, the Simple Cork venture could be an added bonus. In retrospect, wine enthusiasts may invest in RCGR just for Simple Cork’s stand alone potential, and see their investment as having cryptomining in the mix as a added bonus.
 
random crypto mining photo
Perfect Timing For Crypto Mining
For companies getting involved in cryptomining, the opportunity to get started during a correction period is a blessing. When one starts mining, they have zero inventory and sell what is mined same day for profits. If they hold their mined coins, and build their inventory in hopes the crypto market returns to the trading levels in December, not only will their daily mined coins sell at a much more profitable level, their past inventory’s value has grown significantly as well also.
Cryptomining is a very a lucrative and highly profitable business once the initial equipment is paid for. The cost to run a rig is maybe a few dollars a day in electricity, so any value in coins mined is profit. Rigs take up very little space, can work 24/7 without breaks, days off, health benefits, vacations, sick leave etc. like an employee would need. Similar to oil companies, they know that the overall process is going to cost them $20/barrel to produce. So, it doesn’t matter the price of oil is $40/barrel or $80/barrel, its profitable, but when prices are higher, its that much MORE profitable. That is how cryptomining works. At current coin prices, the latest miners can generate $10-12 worth of coins a day, minus a couple of “bucks” for electricity, you still have huge profit margins. When the cost of coins are way up, similar to the prices in December, a rig can produce $18-$22 a day making it that much more profitable similar to the oil analogy.
The initial cost of the equipment can be steep, but depending on the prices of coins, the cost of the machine can be made back after 6-12 months of nonstop consistent mining. So as previously stated, once the initial equipment cost is made up, the rest is gravy…almost free money working around the clock. The company has yet to give in-depth information on just how many rigs they have, but future filings and/or press releases will shed more light on this division of RCGR.
Simple Cork: The Asset, The Product, The Appraisal 
Simple Cork was an asset once owned by the publicly traded company Vapor Group Inc. (OTCPink: VPOR). As per today’s press release, VPOR shareholders of record as of December 27th 2017, will receive 1 share of RCGR for every 5000 shares owned. Series A Preferred stock holders will not receive any shares, but Series B Preferred shareholders will receive a 1:1. Lastly, the company will assume no less than $2 million of VPOR’s convertible debt. Much of this debt has been converted into Series C Preferred stock and significantly reduced.

Richard Davis, current President, stated, “Overall, the addition of this IP and our commitment to develop Simple Cork™ is yet another game changer for us. Worldwide, on average, about 36 billion bottles of wine are bought and sold each year. The key geo-markets on which we are focused represent approximately 30 billion of these bottles We have developed a comprehensive go-to-market business plan to be executed over 36 months from market entry which is projected for later this year. We believe once launched Simple Cork™, as a separate initiative from our cryptomining business, will have a significant positive impact on shareholder value.”

Obviously, the RCGR team saw something in the Simple Cork asset, in which they will be able to develop and bring value to the intellectual property.

Simple Cork is a revolutionary integrated wine bottle opener and cork. It has been awarded a patent in France. The company is confident the French patent will be the first of many that they’ll receive. As a result, the Simple Cork™ has been filed for patent protection in 8 other countries, as well as under the ‘Patent Cooperation Treaty’ in which 70 countries participate.

On November 29, 2017, RCGR obtained a copy of an independent CPA appraisal using the ‘relief-from-royalty method’ of the estimated ‘fair value’ of the intellectual property once in market. The valuation used in the Appraisal was performed in conformity with the ‘Statement of Standards for Valuation Services No. 1’ of the American Institute of Certified Public Accountants (“AICPA”). The standard of value used was ‘fair value’, which per the Financial Accounting Standards Boards (“FASB”) is defined as ‘the price that would be received to sell as asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date’. AICPA also finds the definition of ‘fair market value’ in Revenue Ruling 59-60 consistent with the definition of ‘fair value’ as defined by FASB.

As of the date of the Appraisal, the IP of Simple Cork, Inc. was estimated to have a ‘fair value’ of $12,440,000 (U.S.) subject to the Company’s execution of its business plan for Simple Cork™.

 

Follow The Leader, Creating A Standard

Penetrating the “Cork” business will be a challenge, but one must assume they have a plan.of action. If their cork can been seen as revolutionary cork technology, it will be huge for the company. The goal is is to land major bottlers around the world and soon the others will follow suit.
Take Coors Brewing company, back in 1997 they patented the wide mouth can which had a 45% larger opening, allowing a smoother drinking capability. Soon after, and we can all witness today, the wide mouth opening is an industry standard.
The evolution of the cork has changed throughout the years also. Many complained standard old fashioned corks risked breaking apart in your wine when using a corkscrew. Then came along a spongy plastic imitation cork like solution. RCGR is betting on the convenience of offering a reusable cork that contains a mechanism which allows consumers to easily remove it without a corkscrew. If the cost is inexpensive enough comparable to standard corks it can be a hit. Even if its trend that only lasts a year or two, within that time, the company could do very well.
Investment Summary
Many investors feel RCGR should be trading in the dollars, as the recent asset of Simple Cork came in above the $12 million mark, and with a market cap of just $2 million, simple math shows its currently trading at only 1/6th of November appraisal by a certified independent group. If you mix this in the excitement of cryptocurrency, which I will be honest, its not as hot a sector as it was in late November, but the outlook is still sexy, and has major potential. The backlash to crypto is the influx of ICO’s and abundance of altcoins, but mining the base coins such as litecoin, ethereum and bitcoin, are much more stable. The company is reporting, allowing transaparency, so any curiosity investors may have about the cryptomining side of the company will soon be known. The company does have a small float and can move very easily with positive volume. We will continue to watch RCGR’s developments.
Disclosure: PSInvestor has NOT been compensated the above mentioned article, nor do we hold a position in the company. Please read our FULL DISCLOSURE here.

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