Data Science. Credit Scoring. Digital Finance THE MOST INNOVATIVE - - PowerPoint PPT Presentation
Feb-19 Data Science. Credit Scoring. Digital Finance THE MOST INNOVATIVE TOP-2 TOP-50 INNOVATION TOP-250 FINTECH 100 HOTTEST IN CREDIT SCORING FASTEST GROWING FINTECH FASTEST GROWING LEADER COMPANIES STARTUPS IN EUROPE SERVICES
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THE MOST INNOVATIVE IN CREDIT SCORING SERVICES INNOVATION LEADER 2017 TOP-250 FINTECH COMPANIES October 2018 TOP-2 FASTEST GROWING FINTECH COMPANY IN EUROPE April 2018 TOP-50 FASTEST GROWING COMPANY IN EUROPE March 2018 100 HOTTEST STARTUPS IN EUROPE September 2018 September 2018
Feb-19
2 MARKET OVERVIEW AND COMPETITORS LANDSCAPE PRODUCT & IT KEY FINANCIALS AND FUNDING STRATEGY 3 4 2 EXECUTIVE SUMMARY 1
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try: digital consumer finance
nded ed: 2015, HQ Barcelona
ees: : 300+ 300+
ucts ts: Consumer instalment loans
hy : Europe (Spain & Poland), LatAm (Brazil & Mexico) LEADING INTERNATIONAL FINTECH COMPANY
Global Expansion: Europe and LatAm Revenue Company Overview
ES 2015 (HQ) PL 2015 BR 2016 MX 2017 BL 2012 (R&D hub)
Key Business Highlights
ancial al performa formanc nce: − $49m m revenue for 2018 (236 236% growth vs. 2017) − $92m m issued for 2018 (121 21% growth vs. 2017) − $52m m gross portfolio in Dec-18 (88 88% growth vs. Dec-17)
tomer er base: e: 1. 1.5m m registered users as at Dec-18 (x2.4 vs. Dec-17)
use e IT platfor form and international expertise
15 49 67 201 323 92 610 2017 2018F 2019F 2020F 2021F
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LEADING INTERNATIONAL FINTECH COMPANY
Our successful tractions was proved by top Recent Selected Awards
Fastest test growing ing fintec ntech company ny in Europe Fastest test growing ing company ny in Europe e 100 hottest est startup tups in Europe
To build number er one online consum umer er lending ng platfor form across Europe (Poland, Spain) and LatAm (Brazil, Mexico) To launc nch h new consum umer er prod
ucts ts:
Our strategy
c.20,000
Key Numbers Empowering underbanked to become financially included and live better lives by offering flexible, technology-empowered financial products Our mission
The most inno novati tive ve in credit dit scoring ing servi vices es
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RAPID GROWTH EMPOWERED THROUGH EFFECTIVE SCALING STRATEGY
Centrali ralise sed d IT and risk- infrastr rastruc ucture re Avail ilabili bility of fundin ding Profes fessio ional al and d motiv ivate ated d globa bal l and local al team am
2017 2018 2019 2020 2021
Gross Loan Portfolio Launch in Europe LatAm expansion Product diversification Further scaling
ain. . Jun-15 15
and. . Dec-15 15 Hired team Launched unsecured lending
Expand product range:
balance)
. Nov-16 16
co. . Sep ep-17 17 Created pool of loyal customers
card business
in other countries
Major facto tors rs for effectiv ective e scaling ing
2016
$1.7bn
$150m 0m
$0.5bn
$52m $28m 8m $6m $6m
Consumer loans Credit cards
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GLOBAL TEAM OF FINANCIAL SERVICES AND TECHNOLOGY EXPERTS
Co-founder, CEO
15+ years of work experience in banking Previously held various positions at Deutsche Bank, Renaissance Capital and RBS in London and Moscow Graduated from Cambridge University with a degree of Master in Economics
Co-founder, COO
10+ years of experience in banking and finance Previous experience: Deutsche Bank, London Holds Chartered Financial Analyst degree Graduated from Imperial College with a degree
Chief Financial Officer (CFO)
Boris Batin PhD Alexander Dunaev CFA Kieran Donnelly
19+ years of experience in financial services Previous experience in General Electric and Standard Chartered Bank Graduated from ESADE University (Barcelona, Spain) with a degree of MBA
Chief Risk Officer (CRO)
Ekaterina Kazak
10 years of work experience in risk management Previously worked as Head of Russia & CIS Experian Analytics Graduated from Moscow State University of Economics, Statistics and Informatics
Chief Marketing Officer (CMO)
Alessandro Ceschel
11 years of professional experience in Digital Marketing and international IT Projects Previously developed online internet businesses B2C, B2B and P2P in Spain – Ulabox, Logismarket, Socialcar, worked in MNC (Nestlé) and in early stage startups Graduated from Padova University with a Master in Industrial Engineering and Business Administration
Country Manager (Mexico)
Yannick Del Ponte Bonilla
20+ years of experience working for financial multinational companies. Previously held senior management positions in Servicios Financieros con Valor, Pretmex and Fullerton Financial Holdings Certified in Financial Institutions for Private Enterprise Development at Harvard Kennedy School Post Graduate Certificate in Corporate Finance at Universidad Intercontinental
Javier Lopez
30+ years of management experience in banking and finance Served as CEO of 4finance Holds senior roles at Standard Bank Group, MDM Bank and Renaissance Group
Board member Country Manager (Brazil)
Antonio de Brito
12+ years of experience in financial services Previous experience in Asset Management industry as well as in Enova (multinational
Operations Manager and Security Asset Graduated from Duke University at North Carolina, USA, with a degree of MBA (Operations and Strategy)
7 MARKET OVERVIEW AND COMPETITORS LANDSCAPE PRODUCT & IT KEY FINANCIALS AND FUNDING STRATEGY 3 4 2 EXECUTIVE SUMMARY 1
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33% 33% 37% 37% 37% 37% 40% 40% 42% 42% 52% 52% 69% 69% World average Spain Australia Brazil UK India China
$40
bn revenue ue by 2028 2028 (BR+MX) Money transfer & payments
ech adoptio ion n and Brazil il is in Top Top-5 5 market ets with the e highest hest FinTec ech adopti tion.
el is expe pecte ted d to grow from 40% to 69%
*Adoption is a percentage of respondents in each market who reported using one or more FinTech service in that category. Calculated based on survey prepared by E&Y in 2017
FinTech adoption* (world), 2017 Adoption in Brazil is anticipated to grow up to 69 69%* Insurance Savings & Investments Financial planning Borrowing The major FinTech categories
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70 70 79 79 89 89 100 100 113 113 127 127 142 142
$0 $20 $40 $60 $80 $100 $120 $140 $160 2016 2017 2018 2019 2020 2021 2022
ech market t is rapidly dly growing ng in LatAm and expe pecte ted d to gener nerate te $40b 0bn n in the e next xt 10 years with trans nsaction n volumes es futur ture e CAGR of 12%
Transaction volumes on LatAm FinTech market ($bn)
Actuals Forecast
Sources: Statista, E&Y survey (2017), Goldman Sachs
303 303 648 648 802 802
2008 2017 2022
Sources: EIU, Goldman Sachs, Central bank of Brazil, ID Finance
Household loans in Brazil and Mexico, $bn
with 7% CAGR expected in Brazil and Mexico
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Low competition: 5 banks controlling c. 80% bank assets which results in the world’s third highest borrowing costs Outdated technology: offline and bureaucratic business processes
Internet and mobile penetration increases: Brazil is the fourth-largest by number of smartphone users in the world (80 mln) New distribution channel for financial services makes “branch”-banking obsolete Only 14 bank branches per 100,000 inhabitants and only few small alternative consumer lenders (Kueski, Kubo, Albo, Prestadero) cause strong demand in banking services Young, educated, tech-savvy and financially literate generation enters the period of greatest productivity Structural reforms, fiscal discipline, falling nominal interest rates will unlock GDP growth during next 2 years >50% 0% Brazil & Mexico population is underbanked
Economic recovery Demographic bonus Underbanked population Technology disruption Arising Mexican market Uncompetitive banking services
Uncompe petit itiv ive e banking ng servic ices togeth ther er with incre rease se in mobile e penet netra rati tion n and growth th of popula lati tion n crea eate te strong ng opportunity tunity for FinTec ech companies nies to gain market et share from politi tically ly influe luenc nced ed incum umbe bent nts
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5 10 15 20 25 30 Jan-16 Mar-16 May-16 Jul-16 Sep-16 Nov-16 Jan-17 Mar-17 May-17 Jul-17 Sep-17 Nov-17 Jan-18 Mar-18
dit card market et in Brazil il is g growing ing 10% annua ually ly
ehold d consum umpt ptio ion n was c cleared ared through ugh credi edit t cards s in 2017 7
il still l has the highest hest credi edit t card d rates es of all OECD countries tries
Monthly transactions made by credit cards, $bn Credit card outstanding balance, $bn
30% 30% 12% 12% 16% 16% 4% 4% 3% 3% 35% 35% ITAU Banco De Brazil Bradesco Santander Caixa Other
$61b 1b n
Top 5 players represent 65%
Credit dit card trans nsactions ns repr present esent
househo ehold ld consum umpt ptio ion
Sources: MarketLine, ABECS, Companies’ Reports, ID Finance analysis
55 55 61 61 67 67
Forecast
* Interest free transactions, associated with an instalment plan or not. ** Regular instalments (non interest free) only. *** Includes cash withdrawals
20 40 60 80 Revolving*** Financing** Non-financing*
Annual Monthly Major traditional banks Banco do Brasil 195.7% 9.5% ITAU Unibanco BM 218.3% 10.1% Caixa 252.4% 11.1% Santander 254.8% 11.1% Bradesco (Brasil) 255.0% 11.1% Average (major banks) 235.2% 10.6% Digital nature banks (certain examples) Banco Inter 95.8% 5.8% Banco Original 369.4% 13.8% Agibank 514.2% 16.3% Nubank n/d 2.8%-14.0% Next n/d 15.1%
Statistics on interest rates
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933 933 1,079 1,129 1,161 1,212 1,281 1,362
$0 $200 $400 $600 $800 $1,000 $1,200 $1,400 $1,600 2016 2017 2018 2019 2020 2021 2022
537 537 583 583 633 633 687 687 747 747 811 811 880 880
$0 $200 $400 $600 $800 $1,000 2016 2017 2018 2019 2020 2021 2022
pe has world average ge adopti tion n of 33% with Spain n in Top-6 6 market ets with the highest hest FinTech ech adopti tion.
l is expe pecte ted d to grow from 37% to 56%
pean n FinTech ech market et is e expe pecte ted d to grow with 9% CA CAGR unti til 2022
Transaction volumes on European FinTech market ($bn)
Actuals Forecast
Sources: Statista
Key European market trends
Sources: EIU
Household loans in Spain and Poland, $bn
consumer loans
(2017-22) expected in Spain and Poland Spain and Poland nd constitute only 8% 8% of European FinTech market Europe has world average adoption of 33% with Spain in Top-6 marke kets ts with the highest t FinTec ech adopti tion
grow from 37% 37% to 56 56% Investment in venture capital is growing with $4.7bn n invested ted in 2017 Shift in investment from main financial hubs (London, Germany, France) to Central and Eastern Europe as more rapidly growing underdeveloped fintech markets The Central and Eastern fintech market is worth an estimated €2.2 billion ($2.6 billion)
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Disruptive Consumer Focused Digital Banks (globally) Equity raised to date
R$567mln vs. R$170.mln in 2016. Net losses: R$117mln in 2017
t valuation: tion: $4bn n (Oct-18).
$707 07m
international money transfer, investment, overdraft, and cash withdrawal and deposit at stores.
t pre-money
tion is $2.7 .7bn (Jan-19) 19)
$513 13m
then expanded into banking by offering current accounts, now plans to launch commission-free trading
t valuation: tion: $1.7 .7bn (Apr-18)
$340 40m
$480 80m
begun rolling out its current accounts
t pre-money
tion is $1.3 .3bn (Oct-18)
$280 80m
to see their money from a new perspective
$190 90m
Profe fess ssio ional al team am Access s to fundin ing Loya yal l client nt base
Key ID Financ nce e compet etit itive ive advanta ntage ges
ID Finance unlocks talent pools in countries outside LatAm and shares international expertise ID Finance may use internally generated income to scale and grab market share ID Finance may leverage existing loyal customer base offering new banking products and driving LTV up
Became e unicorn
s in 2018/e /earl rly 2019
14 MARKET OVERVIEW AND COMPETITORS LANDSCAPE PRODUCT & IT KEY FINANCIALS AND FUNDING STRATEGY 3 4 2 EXECUTIVE SUMMARY 1
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WE TARGET PEOPLE LIVING IN LARGE CITIES WHO ARE UNDERSERVED BY TRADITIONAL BANKS
Geographical expansion strategy Disposable income 25-45 years old Age
monthly for LatAm and EUR1500 for Europe Availability of product across the whole countries presence Has a smartphone Active card user Has bank account, but partially underbanked Active loan users Have/had any loan
mortgage…)
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WE PLAN TO OFFER A RANGE OF FINANCIAL SERVICES ON A FULLY MOBILE PLATFORM IN LATIN AMERICA
ACQUISI UISITIO ION
Develop unsecured lending and build up loyal customer base
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RETEN ENTION ION
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Collect data, monitor and instantly address issues to increase retention and lower churn
Steps: s:
NEW PRODUC DUCTS TS
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Offer new products to existing customers – credit cards, payments, FX etc.
In LatAm Am, ID Finance plans to … ... develop existing products … launch new consumer products
lending platform across Europe (Poland, Spain) and LatAm (Brazil, Mexico)
consumer lending know-how
$
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HIGHLY EFFECTIVE CLIENT ACQUISITION AND RETENTION STRATEGY
Term APR Europe: $25 - $1900 LatAm: $50 - $750 Loan size Europe: 50% - 100% annually LatAm: 15% - 30% per month 1 – 12 months
(vs. 3.9m for 2017)
(vs. 0.5m for 2017)
(vs. 121k for 2017)
22% 22% 90% 90% 10% 10%
Conversion to applications Approval rate Retention rate
Clien ent Acquisition
18) Produc
t over erview
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PROPRIATERY IT PLATFORM AND IN-HOUSE IT TEAM
Web and mobile application Ongoing IT-support High Technologies Park Dedicated developme nt team
Proprietary developed IT platform makes personal banking services available for thousands of active mobile users automazing regular banking activities Highly efficient org structure:
end developers
Using user-centric approach constantly improve usability, accessibility, empower high-quality visual designs and front-end development
Technology
1 3 6 2 5 4
Located in the center of IT innovations - Belarus High Technologies Park
Flexibility
In-house developed IT infrastructure allows IDF to adapt to changing fintech market conditions faster than competitors
Top-25 25 IT companies in Belarus*
Chief Technical Officer (CTO)
Pavel Shareyko
13 years of experience in software development, including development of high-load applications and financial systems Previous experience: Lead developer at Itransition Graduated from Belorussian State University * dev.by
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Credit history Internet presence Fraud prevention Behavioural data 1 2 3 4
The dat ata-dr driven client nt assess ssme ment nt of the client nt is key to a robus ust credit it risk manag nageme ment fram amework
ID Finance uses market leading risk-management solutions, in addition to proprietary technology empowered capabilities
20 MARKET OVERVIEW AND COMPETITORS LANDSCAPE PRODUCT & IT KEY FINANCIALS AND FUNDING STRATEGY 3 4 2 EXECUTIVE SUMMARY 1
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18 45 73 293 933
100 200 300 400 500 600 700 800 900 1,000 2017 2018 2019 2020 2021
Lending: Europe Lending: LATAM Credit Cards X23 GROWTH IN 3 YEARS
Reveune ($m)
CAGR (2018-21)
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42 92 230 837 2,437 500 1,000 1,500 2,000 2,500 3,000 2017 2018 2019 2020 2021 Lending: Europe Lending: LATAM Credit Cards X19 GROWTH IN LOANS ISSUED (2018-21)
Number of loans/cards issued (mln) (2018-21)
Gross loan portfolio ($m)
CAGR (2018- 21)
28 52 150 491 1,742 200 400 600 800 1,000 1,200 1,400 1,600 1,800 2,000
2017 2018 2019 2020 2021
Lending: Europe Lending: LATAM Credit Cards
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STRONG UNIT ECONOMICS
118 118 118 118 118 118 28 28 28 28 28 175 175 175 175 203 203 203 347 347 62 933 100 200 300 400 500 600 700 800 900 1,000 Interest income Interest expenses Provision and write off Operating expenses Administrative expenses Tax expenses Net income
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Co-founder, COO @ ID Finance
Alexander.dunaev@idfinance.com
Co-founder, CEO @ ID Finance
Boris.batin@idfinance.com
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regulation or which would require any registration or licensing within such jurisdiction.
is made as to the accuracy, completeness or fairness of the presentation and the information contained herein and no reliance should be placed on such information.
facts, including, without limitation, any statements preceded by, followed by or including the words “targets”, “believes”, “expects”, “aims”, “intends”, “may”, “anticipates”, “would”, “could” or similar expressions or the negative thereof. Such forward-looking statements involve known and unknown risks, uncertainties and other important factors beyond the company’s control that could cause the company’s actual results, performance or achievements to be materially different from future results, performance or achievements expressed or implied by such forward-looking statements. Such forward- looking statements are based on numerous assumptions regarding the company’s present and future business strategies and the environment in which it will operate in the future. These forward-looking statements speak only as at the date of this presentation. The company expressly disclaims any obligation or undertaking to disseminate any updates or revisions to any forward-looking statements contained herein to reflect any change in its expectations with regard thereto or any change in events, conditions or circumstances on which any of such statements are based.