Keys to the Kingdom. Kathy Gregory Experienced entrepreneur Started a software company 15 years...
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![Page 1: Keys to the Kingdom. Kathy Gregory Experienced entrepreneur Started a software company 15 years experience as a real estate agent VP of mortgage lending.](https://reader036.fdocuments.us/reader036/viewer/2022082711/56649ead5503460f94bb3caf/html5/thumbnails/1.jpg)
Keys to the Kingdom
![Page 2: Keys to the Kingdom. Kathy Gregory Experienced entrepreneur Started a software company 15 years experience as a real estate agent VP of mortgage lending.](https://reader036.fdocuments.us/reader036/viewer/2022082711/56649ead5503460f94bb3caf/html5/thumbnails/2.jpg)
Kathy Gregory
Experienced entrepreneurStarted a software company
15 years experience as a real estate agentVP of mortgage lending for a Canadian bank
Started Pardigm Mortgage processing company
![Page 3: Keys to the Kingdom. Kathy Gregory Experienced entrepreneur Started a software company 15 years experience as a real estate agent VP of mortgage lending.](https://reader036.fdocuments.us/reader036/viewer/2022082711/56649ead5503460f94bb3caf/html5/thumbnails/3.jpg)
ParadigmCurrent Situation
• Provides business processing outsourcing services to mortgage lenders in Canada
•Sub prime crisis was hitting US....Canada stricter finance rules helped them avoid similar crisis but the effects were felt around the world.....money started to dry up
•In canada, start up and foreign institutions started entering the mortgage lending industry in Canada........
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•The mortgage market became more competitive
•Kathy identified an opportunity to provides these new lenders with the services to facilitate mortgage processing, lines of credit, and home equity loans
•She would customize her services according to the finance rules....of each unique market she served
•Paradigm quickly became successful, administering 3 billion of mortgages
![Page 5: Keys to the Kingdom. Kathy Gregory Experienced entrepreneur Started a software company 15 years experience as a real estate agent VP of mortgage lending.](https://reader036.fdocuments.us/reader036/viewer/2022082711/56649ead5503460f94bb3caf/html5/thumbnails/5.jpg)
It doubled to 6 billion one year later
Rev grew to 29 million
Earnings before interest, taxes, deprecation... were 4 million
Offices in Toronto and Vancouver
147 employees
They provided superior customer service
Conducted audits to ensure accuracy and to mitigate risk, and follow best practices for the
industry developing a solid reputation
![Page 6: Keys to the Kingdom. Kathy Gregory Experienced entrepreneur Started a software company 15 years experience as a real estate agent VP of mortgage lending.](https://reader036.fdocuments.us/reader036/viewer/2022082711/56649ead5503460f94bb3caf/html5/thumbnails/6.jpg)
In 2007 paradigm started working with Canadian Muslims
They identified an opportunity to develop sharia compliant mortgages
Sharia is Islamic law.....illegal to pay for the use of money.....the bank would have to buy the property and the buyer would have
to make payments to buy it from the bank at a higher priceNo late fees are applied
The bank asks for collateral but the property is in the name of the buyer????
Saudi investors wanted paradigm to help them build a mortgage business in Saudi
The Saudis were well educated and had the moneyThe saudis had experience in construction, oil, insurance,
equipment leasing
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The Saudis would create a new company that would sell mortgages to low and middle income
families
A joint partnership would be created between paradigm and tlc, the Saudi company
10 million in start up capital would be needed
Of which paradigm would put up 1 to 2 million
Paradigm would own 40% of company
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Meanwhile, the sub-prime crisis affected markets around the world and the recession hit
As governments tried to shore up financial institutions, banks stopped lending ..... With a
recession looming for the foreseeable future, they decided to put the joint venture on hold...........
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SAUDI DEMAND FOR REAL ESTATE
91% of Saudis lease houses42% want to own
66% could afford to buyDef a growth market
Mortgage financing low in Saudi 2% of GDPStudies show that the Saudi real estate has huge
growth potential
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Current Competition in Saudi Arabia
Real Estate Development Companies - provides interest free loans, many of which have been defaulted on
Public pension agency - purchased homes for government employees and the military
Saudi credit and savings bank
Other commercial banks
Mortgage Finance Companies
A coalition of four companies formed to fund housing projects
All knowledgeable in sharia finance law
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Gregory and Saudis believe
There is little competitionThere is a high demand for mortgages
A new finance co would increase awarenessA pending real estate mortgage law would drive
demandThe new law would provide protection to lenders
And increase home ownership
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CENTRAL QUESTION
Should Paradigm form the joint venture and enter the Saudi market?
Present Adv and Disadvantage
Growth opportunity to enter new marketProvides experience for entering other muslim markets in the futureYoung company with limited resourcesReal estate was a sketchy market at this pointCultural and religious differences huge.....Saudi is THE most restrictive country!Women have no rights in this country!!!!!!!!!Possibility of Anti-American partners......Market not well regulatedNot certain what the new law will look like
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Pertinent Questions
Would you do business in SaudiWhat are the risks.....The ambiguity of the
pending lawWhat about the competition in Saudi..... The
newly formed coalitionDo you have employees who known language
and cultureAre the financial terms of the deal favorable
to ParadigmDoes Paradigm have the resources to enter
this market