Pagaya Technologies Ltd. · NASDAQ:PGY
Pagaya Technologies — Investor Presentation (August 2024)
22 slides from Pagaya Technologies's investor presentation, August 2024
Slide 1: Pagaya Technologies Investor Presentation
August 2024 INTRODUCTION Pagaya Technologies Investor Presentation 1 1
Slide 2: Disclaimer
Disclaimer Forward-Looking Statements Thi s present ation (“Presentation”) is provided by Pagaya Technologies Ltd. (“ Pagaya” or the “Company”) for informat ional purposes only . The informat ion contained herei n does not purport to be all -inclusive and none of Pagaya, its affiliates, any of its o
Slide 3: Company Overview
01 Company Overview 3 3
Slide 4: Delivering more financial opportunity
MISSION Delivering more financial opportunity to more people, more often 4 4
Slide 5: Pagaya by the numbers
Pagaya by the numbers 31 Lending partners 5 Markets (personal loan, auto, 120 Funding partners >$2T Applications evaluated since inception point-of-sale, credit card, and single-family rental) >$22B Funding raised across 50+ ABS transactions since ~$1B Annualized run-rate total revenue ~$200M Annual
Slide 6: Consumers can’t get the credit they deserve
The Problem Consumers can’t get the credit they deserve 42% ~$120K 31 Unique API of U.S. consumers are denied the Average income of our borrowers(2) Integrations credit they seek under legacy credit Into lending scoring models(1) origination systems across multiple markets Our Solution Ensuring lend
Slide 7: Lenders add more borrowers under their brand
How our Product Works Lenders add more borrowers under their brand With Pagaya, the end borrower gets an offer from the lender they trust Step 1 Step 2 Step 3 Step 4 Per so nal Loan Per so nal Loan Per so nal Loan The outcome: a seamless experience for lenders & borrowers API • Lender keeps the rela
Slide 8: How We Fund Our Network Volume
How We Fund Our Network Volume Unlike traditional funding models, we raise funding before assets are created – minimizing liquidity risk Upfront funding model mitigates liquidity risk Pagaya’s upfront funding model • Pagaya raises cash from investors first, which sits in a trust waiting to be deploy
Slide 9: How We Make Money
How We Make Money Pagaya earns $3.5 - $4.5 in FRLPC1 for every $100 of loans issued FRLPC1 driven primarily by fees paid by our lending partners for helping them add more borrowers Lending Partners Funding Partners Pay fees to Pagaya to use our product to originate more loans and gain new customers
Slide 10: Driving profitability with growing unit economics
Driving profitability with growing unit economics Network volume Total revenues $ in millio ns & YoY % growth $ in millio ns & YoY % growth 33% 31% 28% 19% 31% 4% 13% 8% 10% 1% Take rate% ¹ 9.5% 9.5% 8.8% 9.8% 10.4% Fee revenue less production costs Adj. EBITDA $ in millio ns & YoY % growth $ in mil
Slide 11: Growth Strategy
02 Growth Strategy 11 11
Slide 12: Sustainable, cost-efficient growth strategy compared to D2C lenders
Sustainable, cost-efficient growth strategy compared to D2C lenders Sustainable growth through macro volatility Volume change (%) indexed to 1Q’22 Adding Lending Partners To Our Network 140% PL POS Auto 120% Cost Efficient: Scalable: No Increment al Market ing Cost (CAC) New Partners Drive Increment
Slide 13: Expanding our partner network with top U.S. lenders
Expanding our partner network with top U.S. lenders Added 6 enterprise-level partnerships in the last 12 months for a total of 31 lending partners Top 5 Auto Captive Source: ©2023Company internal |data. Pagaya. Confidential FinancialUSE FOR INTERNAL data as of June 30, 2024, unless otherwise noted.
Slide 14: Developing new products to help lenders extract more customer lifetime value
Developing new products to help lenders extract more customer lifetime value Increasing Flagship Product Increasing Customer Products in Development Market Share Wallet Share Enable lenders to capture customers that Product roadmap designed to enhance CLV of Increase Customer otherwise would have be
Slide 15: Pagaya aspires to be the go-to lending technology partner for the consumer finance ecosystem
Pagaya aspires to be the go-to lending technology partner for the consumer finance ecosystem Pagaya’s flagship product started in credit. We strive to help transform a bank’s full value chain with technology Today Long Term Origination Collections Marketing Platforms Funding Underwriting Model Risk
Slide 16: Financials
03 Financials 16 16
Slide 17: Illustrative unit economics: FRLPC margin structure
Illustrative unit economics: FRLPC1 margin structure Metric Definition Illustrative Application Volume Total applications seen from lending partners $1,000,000 Conversion Rate % of loan offers accepted by the borrower 1% The notional value of all assets Network Volume (“NV”) $10,000 created using ou
Slide 18: Increasing fees as we deliver more value to our partners
Increasing fees as we deliver more value to our partners Fee revenue less production costs (“FRLPC(1)”) by product 4.2% 160% 3.8% 140% 3.3% 3.4% 3.2% 120% 3.0% 2.9% 3.0% 2.7% 100% 1% 32% 80% 25% 43% 58% 60% 63% 63% 69% 60% 99% 40% 75% 68% 57% 20% 42% 40% 37% 37% 31% 0% 2Q'22 3Q'22 4Q'22 1Q'23 2Q'23
Slide 19: Growing profitability with higher fees + operating leverage
Growing profitability with higher fees + operating leverage $60 Adjusted EBITDA (in $ millions) $50 $50 $40 $40 $34 $30 $28 $20 $17 $10 – 2Q23 3Q23 4Q23 1Q24 2Q24 *Note: See “Appendix” for a reconciliatio n of non-GAAP measures to the mo st comparable GAAP measure
Slide 20: Pagaya’s value proposition
04 Pagaya’s value proposition 20 20
Slide 21: Our flagship product provides a “win-win-win” for lending partners, their customers and funding partners
Our flagship product provides a “win-win-win” for lending partners, their customers and funding partners Lending Partners Lending Partner Customers Funding Partners Grow originations and customers with no Access to more financial opportunities Efficiently deploy capital at scale in unique incrementa
Slide 22: What makes Pagaya different
What makes Pagaya different Differentiated and sustainable growth strategy Growing data advantage of US population Constantly growing “top of the funnel” by partnering >$2T of applications seen since inception across 30 with lenders lenders and 5 asset classes Stable fee generation through cycles Di
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