Oppfi Inc. · NYSE:OPFI
Oppfi — FG New America Acquisition — SPAC Merger (May 2021)
37 slides from Oppfi's SPAC merger presentation, May 13, 2021
Slide 1: A Leading FinTech Platform for the Everyday Consumer
Investor Presentation May 2021 A Leading FinTech Platform for the Everyday Consumer
Slide 2: Disclaimer
1 Disclaimer This presentation (the “Presentation”) is for information purposes only . This Presentation has been prepared to assist parties in making their own evaluation with respect to a proposed transaction (the “Transaction”) as contemplated by a definitive business combination agreement betwee
Slide 3: Presenters
2 2 Presenters Jared Kaplan OppFi, CEO Shiven Shah OppFi, CFO 7 - Time Executive
Slide 4: OppFi's Vision
3 OppFi’s Vision The Digital Financial Services Destination for the Everyday Consumer 3
Slide 5: OppFi's Mission
4 4 OppFi’s Mission Facilitate credit access Enable savings Build wealth Empower Everyday Consumers to Rebuild Financial Health
Slide 6: Most Americans Lack Savings and Credit Access
5 Most Americans Lack Savings and Credit Access 1. Hamdani , Kausar , et al. “UNEQUAL ACCESS TO CREDIT The Hidden Impact of Credit Constraints.” NewYorkFed.org, 2019 2. Bureau of Labor Statistics – U.S. Full - and Part - Time Workers; Friedman, Zack. "78% Of Workers Live Paycheck To Paycheck.“ Forbe
Slide 7: We Help Everyday Consumers Solve Everyday Problems
6 OppFi customers can use proceeds for any unexpected expense We Help Everyday Consumers Solve Everyday Problems Our typical customer: • Thick File • Median Income • Employed • Bank Account • >30 Years Old • Educated • No Savings Medical Education Family Car Trouble Housing
Slide 8: OppFi Powers Banks to Unlock Credit Access for the Everyday Consumer
7 7 Consumers x 5 minute application process x Instant access to fair, transparent credit x Opportunity to build financial health x Best - in - class mobile acquisition x Alternative data, AI powered underwriting algorithms x Industry - leading, tech enabled customer service Banks Value to Bank Part
Slide 9: We Leverage Billions of Data Points to Make Credit Scores Obsolete
8 OppFi’s proprietary algorithms powered by AI better predict ability and willingness to repay We Leverage Billions of Data Points to Make Credit Scores Obsolete 10+ Million Repayments 14+ Million Loans 1.5+ Million Attributes per Repayment ~500 Applications AI - Powered Proprietary Scoring Algorith
Slide 10: The Digital Financial Services Destination for the Everyday Consumer
9 Mobile Banking & Debit The Digital Financial Services Destination for the Everyday Consumer Our platform leverages proprietary technology to best serve the Everyday Consumer Near Prime Lending Payroll Deduction Lending Auto Lending Credit Cards x Digitally enabled lending platform x Best - in - cl
Slide 11: Vast, Underserved Market Opportunity
10 Vast, Underserved Market Opportunity 1. Elkins, Kathleen. “Here’s how much money Americans have in their savings accounts.” CNBC.com, Sept 13, 2017 2. US Census Bureau and Experian – Based on adult population of US (~255mm) as of July 1, 2019 multiplied by population within 580 - 669 credit band
Slide 12: Key Company Highlights
11 11 Robust Customer Demand More than 2.5 million applications annually, of which 80% are mobile generated Leading Proprietary Credit & Technology Platform Real - time AI drives automation for ~75% of decisions Exceptional Customer Satisfaction Net Promoter Score of 85; 10,000+ online customer revi
Slide 13: Platform with Proven Ability to Scale Profitably
12 Platform with Proven Ability to Scale Profitably Revenue 1,2 Adj. EBITDA 1,3 Adj. Net Income 1,4 Note: Reconciliation of non - GAAP to GAAP financials for 2017 through 2020 located in Appendix pages 29 - 31 1. 2021P projections include impact of recent additional government stimulus and assume a
Slide 14: 1Q21 Results
13 1Q21 Results Unaudited Quarter End March 31, ($ in 000s) 2021 2020 Net Income $24,384 $16,897 Adj. Revenue 1 84,257 88,970 Adj. EBITDA 1 32,361 24,945 Adj. Net Income 2 19,256 13,011 Key Metrics Net Originations $99,809 $124,146 Adj. EBITDA Margin 38% 28% Adj. Net Income Margin 23% 15% Net Charge
Slide 15: Appendix
14 Appendix
Slide 16: Non-Prime Customer More Consistent Following Economic Disruption
15 Coupled with short duration of product, this customer shows more resiliency than higher credit score segments in economic dislocations Non - Prime Customer More Consistent Following Economic Disruption Source: Federal Reserve Bank of New York Consumer Credit Panel, Equifax, “Personal Loan Perform
Slide 17: Resilient Credit Performance during COVID-19
16 Pre - COVID (Avg. 2019) FY2020 Delinquency 1 12.4% 10.8% Active communication with customers and willingness to skip payments when requested Charge - Offs 3 33% 28% Stimulus + reduced spending + customer loyalty We demonstrated our ability to withstand the most challenging economic conditions Res
Slide 18: FG New America
17 FG New America
Slide 19: FG New America Acquisition Corp
18 FG New America Acquisition Corp Kyle Cerminara, President • Co - Founder and CEO of Fundamental Global (FG) • Former Buyside at T. Rowe Price, Point72 and Highside • Institutional Investor Magazine Best of Buyside for Financial Sector (2006) FG New America Team Larry Swets , CEO • Founded Itasca
Slide 20: FGNA Investment Thesis
19 FGNA Investment Thesis Source: Company Filings, SPACinsider and Dealogic ; Market as of 3/7/2021 Note: Reconciliation of non - GAAP to GAAP financials for 2017 through 2020 located in Appendix pages 29 - 31; 2021P projections inc lude impact of recent additional government stimulus and assume a c
Slide 21: FGNA Investment Thesis (cont'd)
20 FGNA Investment Thesis (cont’d) Source: Company Filings, CNBC, Forbes, Federal Reserve 1. Elkins, Kathleen. “Here’s how much money Americans have in their savings accounts.” CNBC.com, Sept 13, 2017 2. Bureau of Labor Statistics – U.S. Full - and Part - Time Workers; Friedman, Zack. "78% Of Worker
Slide 22: Not Just About the Numbers
21 Not Just About the Numbers x Mission - driven organizations • TD Ameritrade : To bring financial literacy to every family in America • OppFi : To bring financial inclusion to the Everyday Consumer x Ameritrade and OppFi Comparison • Ameritrade in 2001 : • Consistently losing money • $700M market
Slide 23: The OppFi Advantage
22 The OppFi Advantage A platform that puts you in control
Slide 24: Scalable, Diversified, Next Generation Marketing Platform
23 43.4% 23.9% 18.4% 15.9% 56.6% 76.1% 81.6% 84.1% -10.0% 10.0% 30.0% 50.0% 70.0% 90.0% 110.0% 2017 2018 2019 2020 Direct Mail Non-Direct Mail Scalable, Diversified, Next Generation Marketing Platform 1. Represents Search Engine Optimization, Email Marketing, Customer Referrals, Strategic Partnershi
Slide 25: Proprietary AI Powered Credit Decisioning Algorithms
24 - 4.0% 8.0% 12.0% 16.0% 20.0% - 10 20 30 40 50 Week 2017 2018 2019 2020 Proprietary AI Powered, Credit Decisioning Algorithms… Our proprietary algorithms look beyond credit score to instantly identify borrowers who have the ability and willingness to repay …Result in Stable Write - offs by Cohort
Slide 26: Powered by Modern and Leverageable Technology Stack
25 …Powered by Modern and Leverageable Technology Stack Modern Data Warehouse Real - time Data & Analytics Machine Learning Microservice Infrastructure Bank Verification Income Verification Continuous A/B Testing $18 Million 2020 Technology Spend 1 1. Technology spend represents cash expense of full
Slide 27: Driving Operational Leverage via Automation and Productivity Tools
26 Driving Operational Leverage via Automation and Productivity Tools Increasing Automated Approvals Increasing Application Conversion Continued increases in operational leverage positions OppFi well for post - COVID demand 0% 7% 18% 26% 41% Dec-17 Dec-18 Dec-19 Dec-20 Mar-21 Auto Approval Rate (AAR
Slide 28: Financial Performance
27 Financial Performance
Slide 29: Growth Strategy and Drivers
28 Credit Card Salary Tap Installment Loans Growth Strategy and Drivers • Assumed return to pre - COVID demand • Improved conversion rate optimization of acquisition funnel • Operational leverage driven by technology gains in automation and productivity • Stable credit • Employer adoption of financi
Slide 30: EBT to Fair Market Value EBT Reconciliation
29 OppFi Current Audited Financials EBT to Fair Market Value EBT Reconciliation ($ in millions) 2017A 2018A 2019A 2020A Current Audited Financials EBT 1 $2.6 $9.7 $33.0 $77.5 Loan Loss Reserve Adjustment 6.8 18.7 26.0 1.1 Capitalization Adjustment (1.2) (6.5) (8.3) 4.9 Increase / (Decrease) in FMV 4
Slide 31: EBT to Adjusted EBT Reconciliation
30 OppFi Current Audited Financials EBT to Adjusted EBT Reconciliation ($ in millions) 2017A 2018A 2019A 2020A Current Audited Financials EBT 1 $2.6 $9.7 $33.0 $77.5 Recruiting Fees, Severance & Relocation 0.2 0.4 0.3 0.2 Amortization of Debt Transaction Costs 0.5 0.5 1.8 1.9 Other Addback and One -
Slide 32: Fair Market Value EBT to Adj. EBT and EBITDA Reconciliation
31 OppFi Fair Market Value EBT to Fair Market Value Adj. EBT and EBITDA Reconciliation ($ in millions) 2017A 2018A 2019A 2020A Pro Forma Fair Market Value EBT $12.9 $35.8 $68.4 $66.7 Recruiting Fees, Severance & Relocation 0.2 0.4 0.3 0.2 Amortization of Debt Transaction Costs 0.5 0.5 1.8 1.9 Other
Slide 33: Quarterly EBT to Adj. EBT and Adj. EBITDA Reconciliation
32 OppFi Quarterly EBT to Adj. EBT and Adj. EBITDA Reconciliation Unaudited Quarter End March 31, ($ in thousands) 2021 2020 Variance (%) EBT 1 $24,384 $16,897 44.3% Fair Value Adjustment -- (123) -- Debt Amortization 521 520 0.2% Other Addback and One - Time Expenses 2 769 56 1,273.2% Adjusted EBT
Slide 34: Quarterly Revenue to Adj. Revenue Reconciliation
33 OppFi Quarterly Revenue to Adj. Revenue Reconciliation Unaudited Quarter End March 31, ($ in thousands) 2021 2020 Variance (%) Total Revenue $84,257 $74,654 12.9% Amortization of Loan Origination Costs -- 14,316 -- Adjusted Revenue $84,257 $88,970 (5.3%)
Slide 35: Benchmarking & Valuation
34 Benchmarking & Valuation
Slide 36: Upstart, Katapult and Affirm: Business Comparison
35 Consumer Finance Originator x x x x Proprietary AI for Credit Decisioning x x x x Highly Automated Decisioning x x x x Utilizes Bank Partnership Model x x x x Diverse Marketing Strategy x x Multiple Years of GAAP Profitability x Core Delivery Model Bank Sponsored Origination Bank Sponsored Origin
Slide 37: Upstart, Katapult and Affirm: Financial Comparison
36 2020A Revenue $323 million $233 million $250 million $670 million 2020A Adj. EBITDA Margin 31% 13% 16% Negative EBITDA 3 ’18A – ’20A Revenue CAGR 55% 53% 141% 86% 4 Product 11 months, $1,500 3 to 5 years, $1,000 to $50,000 10 to 18 months, $100 to $3,500 6 weeks to 48 months, up to $17,500 Market