ANGELA CERESNIE, CO-FOUNDER & CFO

TRENDS IN MARKETPLACE LENDING: EXPANDING FROM THE BALANCE SHEET

CONFIDENTIAL

ORCHARD’S ROLE IN MARKETPLACE LENDING2

P & IWITHDRAWLS P & I

PRINCIPALINVESTS PRINCIPAL

ORIGINATORS BORROWERS

Individuals

Businesses

MANAGERS

Hedge Funds

BDC’s

Asset Managers

RIA’s

Wealth Managers

INVESTORS

INSTITUTIONALBanks

InsurancePensions

Family OfficesGovernments

Sovereign FundsEndowmentsFoundations

Fund of Funds

INDIVIDUALSHigh Net Worth

Individuals

P L A T F O R M

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3ORCHARD’S GROWTH - LENDIT 2013 TO LENDIT 2015

• Institutional Investor product

• $50MM assets managed

• Blog• Lendscape• Meetups

2013 2014 2015

• Originator Database launch

• $100MM assets managed

• Industry Profiles• First Originator

Partnership

• 150+ Profiles in Originator Database

• Manager Database• $3B assets managed• Orchard Curated

Events• Index on Bloomberg• Originator Products

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4MARKETPLACE LENDING EVOLUTION – INVESTOR LANDSCAPE

Retail investors

Single strategy

funds

Multi-strategy

fundsHuge Asset Managers

Global Capital Banks

• The landscape of investors in Marketplace Lending has evolved tremendously to represent trillions of dollars worth of assets

• This trend has been international

• Reasons for investment interest tend to be:• Yield• Asset Diversification• Data Transparency

• Future Trends: Standardization, diversification, and increased liquidity

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5MARKETPLACE LENDING EVOLUTION – ORIGINATOR LANDSCAPE

Innovation Diversify Institutional Data Focus

Balance Sheet

Lenders

Tech Enabled Capital

Liquidity

• Whole loans,• Access to

leverage,• Early

Securitization

Non-lenders

with unique

data start lending

Diversify capital via distribution

Introduction to tech

enabled lending

Expansion to new borrowers and capital

Current Trends: New and unique entrants

Future Trends: Increased pricing visibility and liquidity

Retail + fixed

returns (Zopa)

Various asset

classes

The future will be:• Variable priced

auctions• Secondary markets

for liquidity outside of securitization market

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6LENDSCAPE - 2014

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7LENDSCAPE - TODAY

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8ECOSYSTEM EVOLUTION TRENDS

• Number of participants: from 113 to 165 (and much more curated)• Greater institutional presence • Plethora of categories, both asset classes and participants

The increase in complexity and diversity of the ecosystem is a benefit to both investors and platforms – but can make it more confusing to

navigate.

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9CURRENT CHALLENGES

Investors• Standardization of data, accounting / valuation, legal

documentation, and platform diligence• Benchmarking and market performance metrics• Liquidity

Originators• Increased competition from other platforms and establishment• Regulatory uncertainty• Capital diversification across investor types

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10ENABLING SUCCESS

• Continued borrower focus and smart growth

• Products which help borrowers thrive

• Technology focus

• Data transparency

• Industry-wide collaboration

• Education

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Thank You

ORCHARD PLATFORM