Financial Gravity Companies, Inc. · OTC:FGCO
Financial Gravity Companies — Investor Presentation (March 2021)
87 slides from Financial Gravity Companies's investor presentation, Mar 25, 2021
Slide 1: Welcome To The FGCO Investor Information Meeting
Welcome To The FGCO Investor Information Meeting March 25, 2021 Scott Winters Chief Executive Officer Financial Gravity CONFIDENTIAL;PROFESSIONAL USE ONLY
Slide 2: Agenda
3/25/21 Agenda 1. Scott Winters - Welcome To “The Best - Kept Secret On Wall Street” 2. Paul Williams - Financial Trends 3. Scott Winters - What Have We Accomplished 4. Scott Winters - Mission And Vision 5. Scott Winters - Where Are We Going 6. Ed Lyon - How Are We Disrupting The Tax Profession 7. D
Slide 3: The Best Kept Secret
• Under the radar • Disrupting a huge industry • World class management team NO ANALYST COVERAGE YET... The Best Kept Secret
Slide 4: A Transformation Is Taking Place
A Transformation Is Taking Place The Best Kept Secret On Wall Street
Slide 5: Suspense Before We Dive Deeper
Suspense Before We Dive Deeper Into The Past, Present, and Future Let’s Take A Look At Our Financial Trends . - Please Stick Around To The End Of The Presentation For More Information On Upcoming Meetings
Slide 6: Welcome - Paul Williams, Chief Financial Officer
Welcome To The FGCO Investor Information Meeting March 25, 2021 Paul Williams Chief Financial Officer Financial Gravity CONFIDENTIAL;PROFESSIONAL USE ONLY
Slide 7: Major Public Company Service Providers
Public Auditors Weaver and Tidwell, LLP – Dallas Securities Counsel Scheef & Stone, LLP – Dallas Transfer Agent Securities Transfer Corporation – Plano Major Public Company Service Providers
Slide 8: Recent Major Expansion Events
May 2020 – Acquisition of Forta Financial Group in Greenwood Village, Colorado March 2021 – Acquisition of Vestus Group in Carmel, California Recent Major Expansion Events
Slide 9: Consolidated Balance Sheets
Financial Gravity Companies, Inc. and Subsidiaries CONSOLIDATED BALANCE SHEETS As of September 30, 2020 and 2019
Slide 10: Consolidated Balance Sheets
Financial Gravity Companies, Inc. and Subsidiaries CONSOLIDATED BALANCE SHEETS As of September 30, 2020 and 2019
Slide 11: Consolidated Balance Sheets
Financial Gravity Companies, Inc. and Subsidiaries CONSOLIDATED BALANCE SHEETS As of September 30, 2020 and 2019
Slide 12: Unaudited Pro Forma Condensed Combined Statement of Operations
Financial Gravity Companies, Inc. and Subsidiaries UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENT OF OPERATIONS For year ended September 30, 2020
Slide 13: Consolidated Statements of Operations
Financial Gravity Companies, Inc. and Subsidiaries CONSOLIDATED STATEMENTS OF OPERATIONS For the three months ended December 31, 2020 and 2019 (Unaudited)
Slide 14: Financial Gravity Companies, Inc. stock
Financial Gravity Companies, Inc. (OTCQB: FGCO)
Slide 15: Highest Stock Price and Trade Volume
Highest Stock Price and Trade Volume
Slide 16: Welcome - Scott Winters, Chief Executive Officer
Welcome To The FGCO Investor Information Meeting March 25, 2021 Scott Winters Chief Executive Officer Financial Gravity CONFIDENTIAL;PROFESSIONAL USE ONLY
Slide 17: Corporate Turnaround
CORPORATE TURNAROUND ~ Started Late 2019 We Are Not The Same Old Company
Slide 18: Corporate Turnaround: Problem and Solution
CORPORATE TURNAROUND ~ Started Late 2019 We Are Not The Same Old Company ● Problem Worth Solving: The Tax Business Is Getting Commoditized and Digitized ● Solution: Three New Lucrative Revenue Stream
Slide 19: Framework For Evaluating A Successful Turnaround
FRAMEWORK FOR EVALUATING A SUCCESSFUL TURNAROUND
Slide 20: Past, Present, Future
Past, Present, Future Let’s See How It All Came together Within Our Framework For Turnaround Success Past Present Future
Slide 21: Past Post Turnaround
Past Post Turnaround 1. We Were In Massive Debt 2. We Were BURNING Money 3. We Had Diverted Attention 4. We Didn’t Have Enough Of The Right People 5. We Didn’t Have A Clear Mission And Vision Of The Future
Slide 22: Our Journey To The Present
Our Journey To The Present We Have Sold Our Closed Non - performing Business Units And Company Functions. We Have Cleaned Up Our Balance Sheet. We Are Acting Fiscally Responsible With Profitability On The Horizon. We Have Built A New Management Team (10 New Members).
Slide 23: The Management Team
The Team Management G&S ‘Scott Winters, cEO-FECO ‘Jennifer Winters co0-Feco “4 Pd | Dave O'Rourke President|-Sofos CEO-MPath Advisor CEO TaxMaster Investments Resources Network Ler, Mark Williams Bryce Hamilton kailiWinters EvP of Operations _-«EVPofDistribution VP. Compliance- Forta €CO-Sofos Paul
Slide 24: Rebuilt Technology And Infrastructure
Our Journey To The Present We Have Rebuilt Our Technology And Infrastructure - SalesForce Financial Services Cloud, The World’s Most Robust And Connected CRM. - Orion, the industries cutting edge performance reporting, trading, and client portal. - Laserfiche, an industry - standard process automati
Slide 25: Purchased Forta Financial Group And Vestus Group
Our Journey To The Present We Have Purchased Forta Financial Group And Vestus Group Leveraging Resources And Management Talent. We Have Onboard Several New Financial Advisors That Account For Over Two Million In Revenue Plus Growth. We built a Turn Key Asset Management Platform (TAMP) designed for t
Slide 26: Present Mission
Present Mission: To Give Tax Professionals A Turnkey Suite Of Tools, Training, And Community To Dominate Their Market Through Integrated Tax And Financial Services Advice Becoming True Advisors, Planners, And Partners In Their Clients’ Success.
Slide 27: Three Reasons Tax Professionals Fail In Financial Services
Present Mission: To Give Tax Professionals A Turnkey Suite Of Tools, Training, And Community To Dominate Their Market Through Integrated Tax And Financial Services Advice Becoming True Advisors, Planners, And Partners In Their Clients’ Success. The Three Reasons Tax Professionals Fail In Financial S
Slide 28: The Financial Gravity Machine
$80 $240 $480 $1280 Access Learning Doing Active Revenue TMN FATE 101 FATE 201 FINANCIAL ADVISOR Internet Cost Assumption Outcome Low Mid High New Assets: $5M New Assets: $10M New Assets: $15M New Revenue: $146K New Revenue: $292K New Revenue: $438K Recurring Revenue: $56K Recurring Revenue: $112K R
Slide 29: Future Vision
Future Our Vision: To Dominate The Transformation Of The Tax Industry Into Financial Services By Being The BEST At Education, Technology, And High - Touch Advisor Support And Service. What Does The Math Look Like?
Slide 30: What Does The Math Look Like? New Members
What Does The Math Look Like? Number of New TMN Members per Year Year1 Year 2 Year 3 Year4 YearS # of new Tax Master Network Members 1000 1250 1500 1750 2000 # that enter FATE 101 250 313 375 438 500 # that enter FATE 201 125 156 188 pak 250 # that Produce as advisors 63 78 94 109 125
Slide 31: What Does The Math Look Like? Advisor Tenure
What Does The Math Look Like? Tenure of Active Advisors Each Year into Plan Execution Advisor Tenure Year 1 Year 2 Year3 Year 4 Year 5 ill 63 78 94 109 125 2 63 78 94 109 3 63 78 94 4 63 78 a 63 Total Number of Advisors 63 141 234 344 469
Slide 32: What Does The Math Look Like? Revenue by Tenure
What Does The Math Look Like? Revenue of Each Tenure of Active Advisors Each Year Into Plan Execution Advisor Tenure Year 1 Year 2 Year 3 Year 4 Year 5 1 $9,125,000 $11,406,250 $13,687,500 $15,968,750 $18,250,000 2 $0 $12,625,000 $15,781,250 $18,937,500 $22,093,750 3 $o $0 $16,125,000 $20,156,250 $2
Slide 33: What Does The Math Look Like? Total Revenue
What Does The Math Look Like? Total Revenue Per Year of Plan Execution Year 1 Year 2 Year 3 Year 4 Year 5 Total Membership Revenue $2,025,000 $4,316,250 $6,861,750 $9,651,900 $12,679,020 Total Revenue Per Year of PlanExecution $9,125,000 $24,031,250 $45,593,750 $74,687,500 $112,187,500 Total Revenue
Slide 34: Our Competitive Advantage Speakers
Our Competitive Advantage Speakers
Slide 35: Tax Master Network - Ed Lyon
Tax Master Network March 25, 2021 Ed Lyon Chief Executive Office Tax Master Network CONFIDENTIAL;PROFESSIONAL USE ONLY
Slide 36: Our Market
Our Market - 50,000+ Independent CPAs - 50,000 Enrolled Agents - Financial Advisors
Slide 37: Two Primary Challenges
Two Primary Challenges - Other CPAs - Technology
Slide 38: Our Solution
Our Solution - Escape “Numbers In Boxes” - Stop Just Recording Numbers - Start Breathing Meaning Into The Numbers
Slide 39: Volume
UISJe|A| Volume
Slide 40: Transitioning To Volume
Transitioning To Volume - Raise Fees - Add Higher Value Work - Add Financial Services
Slide 41: Why Financial Services?
Why Financial Services? - Leverage Dollars, Not Time - Passive Income - Build Business Equity
Slide 42: Born On Third Base
Born On Third Base
Slide 43: Why Financial Gravity?
Why Financial Gravity? - Full Range Of Products/Services - FATE 101/201 Training Programs - FATE “Done For You” Partnering
Slide 44: Ultimate Value Proposition
Ultimate Value Proposition ● Disrupting Traditional Accounting ● Demolishing Barriers to Entering Financial Services ● Front - Ending Financial Services through FG Companies
Slide 45: Democratizing Family Office Services - Dave O'Rourke
FGCO 2021 Shareholders Meeting Creating A Competitive Advantage Through Democratizing Family Office Services Dave O’Rourke President Sofos Investments CONFIDENTIAL;PROFESSIONAL USE ONLY
Slide 46: Wealth Management: A Bifurcated Industry
Wealth Management: A Bifurcated Industry Family Offices Have Had Unfair Advantages ● Personalized, Dedicated And Coordinated ● Synergized Wealth And Tax Planning Services ● Comprehensive Suite Of Offers ○ Wealth Management, Intergenerational Transfer, Risk management, Charitable Giving, And More
Slide 47: Mass Affluent Locked Out
Mass Affluent Locked Out Dis - Economies Of Scale ● Siloed Technology And Expertise Prevent Synergies ● Tax And Wealth Are Vitally Important To All Investor Cohorts ● TAMPs Not Innovating In This Area
Slide 48: Massive Opportunity For FGCO: A Blue Ocean Strategy
Massive Opportunity For FGCO A Blue Ocean Strategy ● Democratize Family Office Services ● Disrupt Managed Money Industry ● Capture TAMP Assets And Market Share ● Mine The Trend Of CPAs Transitioning To Advisory ○ Existential Threat From AI ○ Most Trusted Financial Professional ○ Largely Untapped And
Slide 49: FATE - Financial Advisor Technical Education
FATE -- Financial Advisor Technical Education Powerhouse LMS ● Videos, White Papers, Scripts, Collateral ● Self - Directed And Live Interactive Classroom ● Multiple Learning Modalities Graduates Fully Prepared To Mine Existing Client Opportunities
Slide 50: Done-For-You Partnership
Done - For - You Partnership Intelligent Division Of Labor ● Massive Productivity Innovation ● FGCO Performs All Middle - And Back - Office Functions ● Advisor Faces Client & Manages Relationships Significant Additional Revenue Stream For FGCO
Slide 51: Behavior-Driven Investment Philosophy
Behavior - Driven Investment Philosophy Grounded In Two Fundamental Truths ● Popular Risk Tolerance Methods Deeply Flawed ● Control The Controllables ○ Costs ○ Tax Efficiency ○ Diversification ○ Risk Exposure Perfectly Suited To The Accountant/Advisor’s Mindset
Slide 52: Advisor's Alpha
Advisor’s Alpha A Value Proposition Based On Delivering Value ● Efficiencies Boost Returns And Compounding ○ Lower Total Costs ○ Reduced Tax Drag ○ Creative Diversification ○ Sustainable Risk
Slide 53: Tax Alpha
Tax Alpha Common Sense Tax Minimization Strategies ● Asset Location ● Loss Harvesting ● Low Turnover Employed By Institutions And Family Offices For Generations
Slide 54: Confident About Our Future
Confident About Our Future Reasons For Our Confidence ● An A Team ● First Mover Advantage ● FATE ● Done - For - You Partnership Model Thank you!
Slide 55: Disruptive Behavioral Finance - William R Nelson
Disruptive Behavioral Finance March 25, 2021 William R Nelson PHD Chief Executive Office Sofos Investments CONFIDENTIAL;PROFESSIONAL USE ONLY
Slide 56: Problem
Problem - Investors Consistently Underperform By Buying High And Selling Low. - Investors Are Disappointed By The Volatility And Returns. - Investors Fire Their Old And Find A New Advisor. - Companies Must Constantly Acquire New Clients Just To Tread Water.
Slide 57: Documentation Of Underperformance
Documentation Of Underperformance In 2016, The 20 - Year Annualized S&P Return Was 7.68% While The 20 - Year Annualized Return For The Average Equity Fund Investor Was Only 4.79%, A Gap Of 2.89% Annualized. DALBAR Quantitative Analysis of Investor Behavior (QAIB)3/17
Slide 58: Solution
Solution Financial Gravity Uses Innovative Techniques And Technology To Acquire New Clients And Keep Them For Life.
Slide 59: First Understand The Problem
First Understand The Problem Why Do Investors Underperform? ● Fear And Greed/Fight Or Flight ● Motivates Buying High And Selling Low
Slide 60: Humans Herd
Humans Herd - Safety In Numbers - Survival Technique Developed Over Millennia - Herding Instincts Magnify Fear And Greed
Slide 61: Good Advice
Good Advice Warren Buffett Teaches To Be “Fearful When Others Are Greedy, And Greedy When Others Are Fearful.” Easier Said Than Done
Slide 62: Summary: Humans Are Maladapted For Investing
Summary: Humans Are Maladapted For Investing Financial Gravity Seeks To Help investors By Quieting Their Fear, Insulating Them From The Main Herd, Providing Them With An In Crowd Of Their Own.
Slide 63: How We Help Overcome Fear, Greed, and Herding
How We Help Overcome Fear, Greed, and Herding 1. Control The Controllables 2. Real Risk System Ρ 3. Time Optimized Planning 4. Guiding Our Own, Smarter, Contrarian Herd
Slide 64: Control The Controllables
Control The Controllables - Many Advisors Sell Exaggerated Returns Based On Stock Picking Or Market Timing - Both Are Difficult Or Impossible To Accomplish - Empty Promises Of Alpha
Slide 65: We Focus on What We Can Control
We Focus on What We Can Control Make Promises We Can Keep So To Keep Our Clients.
Slide 66: The Real Risk System
For Risk Alignment We Use The Real Risk System Goals : ● Risk And Return Expectations Match Reality ● Keep Clients ● Receive Referrals ● Grow Financial Gravity ● Increase Stock Price
Slide 67: Real Risk System
Real Risk System - Risk Meter - Portfolio Picker - Risk Pledge
Slide 68: Time Optimized Planning
Time Optimized Planning ● New And Innovative Method Of Retirement Income Planning ● Money Is Invested In The Right Way From A Finance Perspective ● More Importantly, Provides Transparent And Easily Understood Near/Mid - Term Income Security To Overcome Fear During Market Declines.
Slide 69: How Time Optimized Planning Works
How Time Optimized Planning Works - Money Needed Soon Is Invested In Lower Risk Investments. - Money Not Needed Soon, Thus Having Time To Recover From Market Declines, Is Invested In Higher Risk Higher Expected Return Investments. - The Right Amount Of Money Is Invested For Each Future Year’s Income
Slide 70: Guiding Our Own Herd
Guiding Our Own Herd Goal : Create Confidence In Our Group
Slide 71: Our Herd
Our Herd - Belief In Our Tools And Methods Is Key To Success - Community Of Tax Professional And Like Minded Advisors - Meetings, Online Forums, And Newsletter
Slide 72: Differentiation and Disruption
Differentiation and Disruption Our Unique, Innovative Behaviorally Attuned Techniques And Technology Provide Disruptive Opportunity And Reinforcing Cycles Of - Confident Investors - Thriving Advisors - Referrals From Both - Growing Revenue - Rising Stock Price
Slide 73: The Blue Ocean Opportunity - Mark Williams
The Blue Ocean Opportunity March 25, 2021 Mark Williams EVP Of Operations Forta Financial Group CONFIDENTIAL;PROFESSIONAL USE ONLY
Slide 74: The Blue Ocean Opportunity
I. Untapped Market II. Current Challenges III. Forta Financial Group Solution The Blue Ocean Opportunity
Slide 75: Understanding the Untapped Market
I. Understanding the Untapped Market ❏ 713,750 Tax Preparer IDs (PTINs) in America today* ❏ Average Professional has $25 - 50 Million of investable assets ❏ $1 Million of revenue equates to $100 Million investment Assets ❏ Current Broker/Dealer Industry is not build for this business ❏ Tax Professio
Slide 76: Current Challenges
❏ Don’t Have Time ❏ Don’t Know What To Do ❏ Don’t Know How To Market Their New Services ❏ Don't Have Wealth Management Experience ❏ Don’t Want More Industry Regulations, Compliance and Licenses II. Current Challenges They Don’t Know What They Don't Know
Slide 77: Forta Financial Group Solution
III. Forta Financial Group Solution ❏ In - House Marketing Support ❏ Dedicated Financial Paraplanner Staff ❏ Full - Service Back Office Support ❏ In - House Professional Money Management ❏ Advisor Education and Training Improving Client Relationships with Expert Support
Slide 78: A Blue Ocean: Why Reinvent The Broker Dealer?
A Blue Ocean An Untapped Market That Has The Potential For Huge Growth Why Reinvent The Broker Dealer?
Slide 79: John Pollock - MPath Advisor Resources
March 25, 2021 John Pollock Chief Executive Office MPath Advisor Resources CONFIDENTIAL;PROFESSIONAL USE ONLY
Slide 80: The Problem
The Problem
Slide 81: The Problem II
The Problem II
Slide 82: The Problem III
The Problem Ill WEALTH MANAGEMENT
Slide 83: The Problem IV
The Problem IV
Slide 84: The Solution
The Solution TAXMASTER S\( OS NETWORK™
Slide 85: Welcome - Scott Winters, Chief Executive Officer
Welcome To The FGCO Investor Information Meeting March 25, 2021 Scott Winters Chief Executive Officer Financial Gravity CONFIDENTIAL;PROFESSIONAL USE ONLY
Slide 86: Mission, Team, Technology and Revenue Math
Mission: To Give Tax Professionals A Turnkey Suite Of Tools, Training, And Community To Dominate Their Market Through Integrated Tax And Financial Services Advice Becoming True Advisors, Planners, And Partners, And Partners In Their Clients’ Success. Scott Winters, CEO - FGCO Dr. William R Nelson, C
Slide 87: Accountability In Scaling: KPIs To Watch
Accountability In Scaling KPI’s To Watch 1. The Number Of New TMN Members 2. The Number Of FATE 101 Participants 3. The Number Of FATE 201 Participants 4. The Number Of New Financial Advisors 5. The Average Revenue Per Financial Advisors Our Commitment To Shareholders -- Quarterly Investor Meetings
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