It means you:

• Pay off the investors by licensing the tech, so they get made whole
• Hire whichever employees you feel like taking from the team, typically the founders + their favourites
• Leave the rest of the company in place

You can do it as a founder as a type of exit where you get paid a whole lot of money.

The bad part is that every other employee at the company basically gets stiffed. The "social contract" of startups is that you forego a big tech-level compensation package in favour of stock options which may provide returns at the point of an exit. In reverse acquihires this social contract is directly violated.