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Marketplace Lending for Commercial Real EstateWALL STREET + SILICON VALLEY =

The Next Gen of Commercial Real Estate FinanceLendIt Conference, April 2016

John Maute, Board of Directors

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LendIt Conference 2016, San Francisco

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Information and Distribution Combined, Power and Control

The financial institutions are in control…The Gate Keepers! They have the broker network sourcing loans They have the investor relationships to sell the loans

Who did the financial institutions sell loans to? Other lenders…Participations….. “The Sharing Economy” Securitizations of Commercial Mortgage Backed Securities (CMBS) Public fixed income funds

Who were the investors in these funds? You, me, and people just like us that need stable fixed income cash

flow and to save for retirement

What Made Wall Street Successful?

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If You Do Not

Change, You May

Become Extinct

Source: “Who Moved My Cheese?” Dr. Spencer Johnson, 1998

Who Moved My Cheese?

Marketplace Lending Summarized in Six Words:

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Traditional Lending Value Chain

BorrowerApply for

Credit / LoanBanks /

ServicersPackage

Loans

InvestorsMutual Funds

Tranches Securitization

Borrower Investor

Peer-to-Peer / Marketplace Lending

“Financial Transformation via Online, Direct Lending”

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Source: “Who Moved My Cheese?” Dr. Spencer Johnson, 1998

Old Beliefs Will

Not Lead You to

New Cheese

Who Moved My Cheese?

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As this industry develops, together, we are stewards for the industry. It is our responsibility to:

Develop best practices Help create responsible regulation Keep out bad actors If we fail to do it ourselves, the government will do it for us

Together, we can create an ethical and transparent system governed by appropriate regulation in order to grow and become part of the sustainable foundation of the Commercial Real Estate Finance industry

Great Opportunity Comes with Great Responsibility

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Source: “Who Moved My Cheese?” Dr. Spencer Johnson, 1998

Change HappensThey Keep Moving the Cheese

Anticipate ChangeGet Ready for the Cheese to Move

Monitor ChangeSmell the Cheese Often So You Know When It is Getting Old

Adapt to Change QuicklyThe Quicker You Let Go of Old Cheese, The Sooner You Can Enjoy New Cheese

ChangeMove with the Cheese

Enjoy Change!Savor the Adventure and Enjoy the Taste of New Cheese!

Be Ready to Change Quickly and Enjoy it AgainThey Keep Moving The Cheese

The Handwriting on the Wall