Important disclosures appear at the back of this report GP Bullhound LLP is authorized and regulated by the Financial Conduct Authority GP Bullhound Inc is a member of FINRA Global Fintech Market Perspectives H1 2019 2 Fintech perspectives – executive summary ▪ GP Bullhound is a leading technology advisory and investment firm, providing transaction advice and capital to category leaders with a focus on fintech globally ▪ We publish our inaugural fintech market report to provide quantitative insights into public and private market valuations across the transaction spectrum and qualitative insights into company business models, technology and customer trends ▪ Based in our London office, Claudio Alvarez heads up our Fintech practice which has completed over 20 transactions involving both Equity and Debt ▪ We also feature many of the leading Fintech investors, companies & CEOs across sectors which we find interesting at the moment given the emergence of Open Banking, the importance of User Experience and the prevalence of Alternative Lending ▪ Several of our recent Fintech advisory transactions and investments are showcased below Sold to Private Placement Private Placement Investment from Investment from Investment from Private Placement Investment from 3 Key sector takeaways Recent Fintech transaction trends 1 2 3 4 6 Public market Fintech analysis Fintech CEO & Investor commentary Appendix A: Fintech trading comparables by category Appendix B: GP Bullhound Fintech credentials & team 5 4 The emergence of Open Banking 1 Digital banks continue to shine in investors’ minds 3 Cloud-based core banking platforms look to take centre stage 4 Continued consolidation in the payments universe 2 GP Bullhound’s view on current trends in Fintech 5 – We have seen an extraordinarily strong consolidation trend in payments in the last twelve months. Most notably the merger of Worldpay and FIS, the acquisition of iZettle by PayPal and the acquisition of Six by Worldline. Strategic rationales focus on complementary products and geographies – Notably, high growth payments companies Adyen and Network International have taken a contrary view and chosen to IPO aiming to grow further organically – We anticipate major acquisitions to continue as lower-growth industry players are looking to acquire digital payment assets – Private companies to watch include Stripe (which was valued at $22.5bn in their latest round) Klarna, Dwolla, Trustly, Paysafe and Checkout.com GP Bullhound’s view on current trends in Fintech Source: CapitalIQ, Pitchbook The emergence of Open Banking Continued consolidation in the payments universe 1 2 – Although the regulatory scheme driving Open Banking (“OB”) is being led in Europe (PSD2), OB is a global theme given the ubiquity of the digital economy and adoption of mobile payments – The announcement of Apple Card and Klarna’s launch of its own OB platform signal that (i) user experience is playing an increasingly vital role and (ii) merchants will look to integrate OB sooner rather than later to create a competitive edge versus other market participants – Investors are bullish on the impact that OB will have with companies raising c.$0.5bn over the last six months, and Plaid’s $250m being the largest fundraise – We expect investors’ level of enthusiasm to continue given the broad application of OB and other tech giants moving into this space TTV: $40m Deal Date: 5 Jun 2019 EV: $42.6bn EV/ Rev: 10.2x Deal Date: 18 Mar 2019 TTV: $25.7bn EV/Rev: 6.4x Deal Date: 28 May 2019 TTV: $38.5bn EV/Rev: 4.0x Deal Date: 16 Jan 2019 TTV: $843m EV/Rev: 6.8x Deal Date: 22 May 2019 TTV: $250m Deal Date: 11 Dec 2018 TTV: $64m Deal Date: 6 Feb 2019 TTV: $20m Deal Date: 3 Feb 2019 6 – Bank’s total global IT spend is forecast to reach $297bn by 2021, with spending on core banking systems accounting for 23% of total spend - the largest segment after mobile/Internet and BI/big data/analytics – With digital transformation impacting banks’ key verticals such as retail investments, retail lending, SME lending and corporate payments – and the emergence of Open Banking – banks are looking for alternatives to proprietary legacy banking platforms which allow them to deploy solutions to market in an agile manner and leverage the cloud and API ecosystems – We will continue to see strategics becoming stakeholders – such as in the case of 10x and Cloud Lending Solutions – but expect investors to continue backing independents as adoption grows and these businesses start generating meaningful ARR levels GP Bullhound’s view on current trends in Fintech (cont’d) Source: CapitalIQ, Pitchbook, Celent, “Global Tech Spending Forecast 2018, Banking Edition”; 10th Tenemos / Accenture Survey 2017 Digital banks continue to shine in investors’ minds Cloud-based core banking platforms look to take centre stage 3 4 – Digital banks raised c.$1.1bn in 2018 but that level looks like it will be surpassed if the pace that H1 2019 set continues – The first quarter of 2019 saw N26, OakNorth, Starling and Chime raise a total of almost $1bn, and we don’t expect this to slow down with rumours about Monzo close to closing a large round that would value it at £2bn; Monese looking to raise $100M+ after its $60m Series B last year; Revolut looking to close another growth round after its $250m Series C last year; and Tide looking to raise £60m – We don’t anticipate any consolidation in the space yet as most players are in ‘ramp-up’ mode but OakNorth has openly stated that it is looking at opportunistic acquisitions, and with the backing of SoftBank, has the firepower to acquire a meaningful player in this space TTV: $97m Deal Date: 13 Feb 2019 TTV: $440m Deal Date: 8 Feb 2019 TTV: $300m Deal Date: 10 Jan 2019 TTV: $200m Deal Date: 5 Mar 2019 TTV: $34m Deal Date: 18 Feb 2019 TTV: $19.6m Deal Date: 7 Mar 2019 TTV: $50m Deal Date: 30 Apr 2019 TTV: $30m Deal Date: 25 Jan 2019 7 Key sector takeaways Recent Fintech transaction trends Public market Fintech analyses Fintech CEO & Investor commentary 1 2 3 4 6 Appendix B: GP Bullhound Fintech credentials & team Appendix A: Fintech trading comparables by category 5 Confidential 8 Global fintech transaction trends M&A and fundraising activity by quarter Source(s): * Pitchbook as of 31 May 2019 Note: Data includes all “Fintech” M&A &private placement deals and IPOs as defined by Pitchbook regardless of geography or transaction size Transaction M&A deal value & volume Fundraising deal values becoming larger The US and Europe dominate M&A deal value Fundraising deal value by region 0 50 100 150 200 250 300 350 $0B $10B $20B $30B $40B $50B $60B $70B $80B $90B $100B Q3 2016Q4 2016Q1 2017Q2 2017Q3 2017Q4 2017Q1 2018Q2 2018Q3 2018Q4 2018Q1 2019Q2 2019*M&A M&A Deals 0 200 400 600 800 1000 1200 $0B $5B $10B $15B $20B $25B $30B $35B $40B $45B $50B Q3 2016Q4 2016Q1 2017Q2 2017Q3 2017Q4 2017Q1 2018Q2 2018Q3 2018Q4 2018Q1 2019Q2 2019*Total Capital Invested Deal count 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Q3 2016Q4 2016Q1 2017Q2 2017Q3 2017Q4 2017Q1 2018Q2 2018Q3 2018Q4 2018Q1 2019Q2 2019*U.S. & Canada Europe Asia Other 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Q3 2016Q4 2016Q1 2017Q2 2017Q3 2017Q4 2017Q1 2018Q2 2018Q3 2018Q4 2018Q1 2019Q2 2019*U.S. & Canada Europe Asia Other 9 Announce Date Target Buyer Target Description Value ($m) Implied EV/LTM Rev 11/02/2019 Digital identity verification and authentication solutions 300 7.9x 11/02/2019 Cloud-enabled services provider for equity plans management 863 7.1x 11/02/2019 Provider of online payment services - - 11/02/2019 Online equity plan administration technology & services 829 7.1x 30/01/2019 Real-time payment solution provider 38 - 18/01/2019 Blockchain-enabled platform for online transactions 72 - 16/01/2019 Electronic commerce and payment solutions 41,770 4.7x 08/01/2019 Financial data analytics 200 - 14/12/2018 Online financial and investment advisory services - - 13/12/2018 Transaction management platform provider 245 - 04/12/2018 Personal financial advisory services provider - - Announce Date Target Buyer Target Description Value ($m) Implied EV/LTM Rev 28/05/2019 Electronic payment services provider 25,700 6.4x 22/05/2019 Payment services and IT solutions for online businesses 843 5.5x 13/05/2019 Platform providing news and data to financial institutions 1,754 - 10/05/2019 Private Equity and alternative investment software 1,490 - 08/05/2019 Provider of cross-border payment services to banks and businesses 273 6.8x 17/04/2019 Cloud-based solutions for the residential mortgage industry 3,608 7.0x 12/04/20109 Provider of payment security and mobile payment technologies 70 - 18/03/2019 Provider of payment processing services 43,000 11.1x 05/03/2019 Expense reporting and supplier invoice automation platform (2) - 01/03/2019 Securities trading technology solutions provider 816 - 28/02/2019 Electronic bill presentment and payment solutions 750 2.1x 26/02/2019 Financial SaaS platform for SME’s and accountants - - 14/02/2019 Currency exchange and payments company 641 - Notable Fintech M&A deals Dec 2018 – June 2019 (1) Source(s): CapitalIQ, Pitchbook, Mergermarket (1)To 4 June 2019 (2) Transaction rumored to be >$1bn 10 Announced Date Targets Lead Investor(s) Target Description Capital Raised ($m) 04/06/2019 Platform to build financial applications 35 04/06/2019 Cloud based open banking platform 10 04/06/2019 Online platform for business loans 52 03/06/2019 Online money transfer service 175 29/05/2019 Online lending and wealth management platform 500 22/05/2019 Online app for investing in different asset classes 74 21/05/2019 Open API platform for managing payments processes 260 13/05/2019 Tech enabled working capital provider 800 02/05/2019 Online payments platform 230 16/04/2019 Employee financial wellness platform provider 32.8 11/04/2019 Peer-to-peer insurance platform for renters and homeowners 300 03/04/2019 Microlender for consumers at point of sale 300 25/03/2019 Platform offering smart cross-border payment solutions 100 10/03/2019 E-commerce payment solutions 93 Announced Date Targets Lead Investor(s) Target Description Capital Raised ($m) 06/03/2019 Online platform for insurance services 125 05/03/2019 Digital-only bank provider 200 13/02/2019 Digital-only bank provider 100 08/02/2019 Online lending and savings solutions 440 07/02/2019 Automated micro investing app 105 07/02/2019 Online payment processing services to businesses provider 75 07/02/2019 Cloud based open banking platform 64 05/02/2019 Term deposit rates marketplace operator 116 29/01/2019 Online payment processing solutions 100 11/01/2019 Mobile financial services across emerging markets 170 09/01/2019 Digital-only bank provider 300 21/12/2018 Online solutions for holiday financing 123 20/12/2018 Offers paycheck advance to workers 125 03/12/2018 Investment and financing services online platform developer 1,330 Notable Fintech private financings Dec 2018 – June 2019 (1) Source(s): CapitalIQ, Pitchbook, Mergermarket (1)To 4 June 2019 11 Key sector takeaways Recent Fintech transaction trends Public market Fintech analyses Fintech CEO & Investor commentary 1 2 3 4 6 Appendix B: GP Bullhound Fintech credentials & team Appendix A: Fintech trading comparables by category 5 12 99.1 15.3 23.2 16.1 7.9 4.1 2.2 2.1 2.2 1.1 1.5 0.4 29.9 15.4 3.0 7.7 3.3 1.7 1.2 1.1 0.6 0.2 128.9 30.6 26.2 23.8 11.2 5.8 3.5 3.2 2.8 1.3 1.0 0.3 Market Cap Change in Market Cap Current Market Cap GP Bullhound’s selected Fintech index market valuations Source(s): CapitalIQ 1. Market capitalization as of 31/12/2018 2. Change in market capitalisation through 31/05/2019 (Market Cap Values in $ in billions) 1 2 (0.5) (0.1) 13 4.0x 6.0x 8.0x 10.0x 12.0x 14.0x 31/05/2016 30/09/2016 31/01/2017 31/05/2017 30/09/2017 31/01/2018 31/05/2018 30/09/2018 31/01/2019 31/05/2019 2019 H1 GPB Fintech Index - TEV/LTM Revenues 2019 H1 GPB Fintech Index - TEV/NTM Revenues Analysis of GP Bullhound Fintech index valuations Revenue multiple trends – last three years Source(s): CapitalIQ as of 31 May 2019. (1) EV/Rev multiples except for online lenders which are computed as Market Cap/Rev multiples Note: Fintech Index constituents are: Paypal, Shopify, Square, Adyen, Market Access, Xero, Envestnet, Q2, Blackline, Lending Club, Funding Circle, Ondeck Current Fintech valuations are trading higher than the three year mean; showing the strength of the current market environment Mean: 9.1x Mean: 8.3x As of May 31 : 10.8x As of May 31: 11.7x EV/Revenue(1) 14 Share price performance – LTM Source: CapitalIQ as of 31 May 2019 Note: Detail on companies included shown in Appendix Banking Technology 16.1% HR & Payroll 39.4% Financial Data & Analytics 25.6% Nasdaq 0.1% Payments 16.2% LTM performance Performance 1 Month 3 Months 6 Months 1 Year HR & Payroll 0.3% 9.6% 32.9% 39.4% Banking Technology (4.6%) 2.5% 12.9% 16.1% Financial Data & Analytics (1.8%) 10.6% 19.2% 25.6% Payments (1.2%) 6.5% 18.5% 16.2% Nasdaq (7.9)% (1.1)% 1.7% 0.1% The Fintech sector is outperforming the NASDAQ 70 80 90 100 110 120 130 140 150 HR & Payroll Banking Technology Financial Data & Analytics Payments Nasdaq 15 Indicative trading valuation benchmarks Source: CapitalIQ as of 31 May 2019 Notes: Mean 14.7% 28.5% 29.5x 9.2x 9.4% 36.4% 24.5x 10.3x 10.6% 33.2% 23.7x 9.7x HR & Payroll Payments Banking Technology Companies Avg. 2019E Revenue Growth Avg. 2019E EBITDA Margin Avg. EV / 2019E Revenue Avg. EV / 2019E EBITDA 3.0% 32.9% 19.0x 7.5x Financial Data & Analytics 16 Key sector takeaways Recent Fintech transaction trends Public market Fintech analyses Fintech CEO & Investor commentary 1 2 3 4 6 Appendix B: GP Bullhound Fintech credentials & team Appendix A: Fintech trading comparables by category 5 17 Fintech CEO profile Meniga offers B2B2C SaaS solutions to help leading banks use data to create better customer experiences and new revenue streams in digital banking. Meniga’s key message to banks is “Banking beyond banking”. To stay relevant, digital banking applications must become more than just a place to perform banking services. They must get smarter and evolve into more of a financial-coach type application that helps people with their financial lives, including how to be smarter consumers and save money. Georg Ludviksson CEO & Co-Founder “We currently see multiple forces bring rapid changes to the world of digital banking. These forces are driving demand for Meniga’s solutions as banks are realizing that if they don’t create more value from their data for their customers, then someone else will” Personal Financial Management Targeted Insights Financial Gamification Personalised Cashback Rewards 18 Fintech investor profile Launched in October 2015, the ABN AMRO Digital Impact Fund is a corporate venture fund investing in innovative start-ups and scale-ups specialising in the digitalisation of financial products and services. The fund is here to add value and allow portfolio companies to access ABN AMRO’s knowledge and network. In March 2018, the fund was raised to €50m thanks to a successful investment pace. Investments range between €1m and €5m. Hugo Bongers Director “From a fund perspective, Open Banking is one of the core trends within financial services. We view it as a real opportunity within ABN AMRO, keeping in mind it still remains the early days of the segment” Digital Impact Fund Open banking APIs Description: Tink enables banks to create next- generation banking services, including account aggregation and PFM Location: Stockholm, Sweden Investment(s): May-16; Oct- 17; Feb-19 Bank as a platform Description: SolarisBank offers a platform that enables digital companies to create custom solutions for their financial needs Location: Berlin, Germany Investment(s): Mar-18 Data aggregation and marketplace Description: CrossLend provides a debt exchange platform where capital flows of originators are matched towards investors Location: Berlin, Germany Investment(s): Sep-18 Data management Description: Tealium offers solutions for real-time customer data orchestration solutions and enterprise tag management. Location: San Diego, USA Investment(s): May-19 19 Fintech CEO profile TrueLayer’s aim is to become the leading provider of financial APIs that power a new era of financial innovation. TrueLayer is building a range of APIs - including a Data API which allows companies to access the financial data of their customers, securely and efficiently and a Payments API which enables seamless, secure and near instantaneous online payments. TrueLayer was founded in 2016 by serial entrepreneurs, Francesco Simoneschi and Luca Martinetti. It has received $47 million of funding from top-tier firms operating in financial services and SaaS business, including Tencent, Temasek, Northzone & others. Francesco Simoneschi & Luca Martinetti Co-founders “TrueLayer’s goal is to foster innovation which removes friction and barriers to entry from banking. This will allow consumers and businesses to benefit from modern, fair and competitive access to financial products and services. We help developers to easily access and operate the technical infrastructure which will make Open Banking a reality, not just in Europe but eventually, across the world” 20 Key sector takeaways Recent Fintech transaction trends Public market Fintech analyses Fintech CEO & Investor commentary 1 2 3 4 6 Appendix B: GP Bullhound Fintech credentials & team Appendix A: Fintech trading comparables by category 5 21 Source: CapitalIQ as of 31 May 2019 Trading comparables – HR & Payroll Market Cap (USDm) EV (USDm) Revenue Growth EBITDA Growth EBITDA Margin EV / Revenue EV / EBITDA P/E Company 31/May/19 31/May/19 18/19 19/20 18/19 19/20 CY2018 CY2019 CY2020 CY2018 CY2019 CY2020 CY2018 CY2019 CY2020 CY2018 CY2019 CY2020 HR & Payroll ADP 69,689 69,858 9% 7% 11% 12% 24% 25% 26% 5.2x 4.8x 4.5x 21.6x 19.5x 17.4x 39.9x 28.1x 24.6x Intuit 63,476 60,578 12% 10% 41% 13% 29% 36% 37% 9.7x 8.6x 7.9x 34.1x 24.1x 21.4x 64.5x 35.8x 30.7x Workday 46,211 45,848 26% 23% n.a. 34% (9%) 20% 21% 16.2x 12.9x 10.4x n.m. 65.5x 48.9x n.m 121.0x 91.3x Paychex 30,832 30,954 18% 6% 15% 7% 42% 41% 41% 9.0x 7.7x 7.2x 21.5x 18.7x 17.6x 37.8x 28.9x 26.6x SS&C 14,079 22,446 38% 5% 71% 8% 32% 40% 41% 6.6x 4.8x 4.6x 20.4x 12.0x 11.0x 62.3x 14.6x 13.2x Paycom 12,198 12,166 27% 23% 56% 25% 34% 41% 42% 21.5x 16.9x 13.8x 63.7x 40.9x 32.7x 112.1x 64.5x 51.4x The Sage Group 10,242 10,774 7% 8% (3%) 7% 29% 26% 26% 4.6x 4.3x 4.0x 16.1x 16.6x 15.5x 28.9x 24.2x 22.2x Coupa Software 6,698 6,551 26% 26% n.a. 151% (15%) 6% 11% 25.2x 20.0x 15.9x n.m. n.m. n.m. n.m n.m n.m Xero 5,826 5,814 32% 27% 94% 49% 13% 19% 23% 17.2x 13.0x 10.3x n.m. 68.0x 45.7x n.m n.m n.m Paylocity 5,309 5,170 26% 20% 238% 25% 11% 29% 30% 12.8x 10.1x 8.5x n.m. 35.1x 28.2x n.m 68.5x 54.8x TriNet 4,436 4,606 (73%) 10% 41% 12% 8% 41% 42% 1.3x 4.9x 4.5x 16.9x 12.0x 10.7x 29.6x 18.7x 16.6x Blucora 1,499 1,621 28% 18% 32% 24% 19% 19% 20% 2.9x 2.3x 1.9x 15.4x 11.7x 9.4x 46.9x 14.3x 11.2x Mean 15% 15% 59% 31% 18% 29% 30% 11.0x 9.2x 7.8x 26.2x 29.5x 23.5x 52.7x 41.8x 34.3x Median 26% 14% 41% 18% 21% 27% 28% 9.4x 8.2x 7.5x 21.0x 19.5x 17.6x 43.4x 28.5x 25.6x 22 Source: CapitalIQ as of 31 May 2019 Trading comparables – Banking Technology Market Cap (USDm) EV (USDm) Revenue Growth EBITDA Growth EBITDA Margin EV / Revenue EV / EBITDA P/E Company 31/May/19 31/May/19 18/19 19/20 18/19 19/20 CY2018 CY2019 CY2020 CY2018 CY2019 CY2020 CY2018 CY2019 CY2020 CY2018 CY2019 CY2020 Banking Technology First Data 23,989 43,693 4% 6% 11% 7% 35% 38% 39% 5.0x 4.8x 4.6x 14.2x 12.8x 11.9x 37.5x 16.1x 14.2x Fiserv 33,695 39,500 6% 5% 25% 5% 33% 38% 38% 6.8x 6.4x 6.1x 20.8x 16.7x 15.9x 41.2x 24.8x 22.3x Temenos 12,040 12,584 18% 12% 58% 14% 29% 39% 39% 15.0x 12.7x 11.4x 52.0x 33.0x 28.9x 98.3x 49.8x 42.8x MarketAxess 11,227 10,973 11% 12% 14% 15% 54% 55% 56% 25.3x 22.7x 20.3x 47.1x 41.4x 36.0x 80.8x 58.5x 50.8x Jack Henry 10,131 10,130 0% 7% 6% 7% 31% 32% 33% 6.3x 6.3x 5.9x 20.6x 19.5x 18.1x 40.0x 37.1x 33.0x Q2 3,237 3,292 29% 22% n.a. 94% (7%) 7% 11% 13.7x 10.6x 8.7x n.m. n.m. 81.8x n.m n.m n.m Bottomline Technologies 1,900 1,922 6% 10% 139% 7% 10% 23% 23% 4.7x 4.4x 4.0x 45.2x 18.9x 17.7x n.m 32.7x 29.5x Mean 11% 10% 42% 21% 26% 33% 34% 11.0x 9.7x 8.7x 33.3x 23.7x 30.0x 59.5x 36.5x 32.1x Median 6% 10% 19% 7% 31% 38% 38% 6.8x 6.4x 6.1x 33.0x 19.2x 18.1x 41.2x 34.9x 31.2x 23 Source: CapitalIQ as of 31 May 2019 Trading comparables – Financial Data & Analytics Market Cap (USDm) EV (USDm) Revenue Growth EBITDA Growth EBITDA Margin EV / Revenue EV / EBITDA P/E Company 31/May/19 31/May/19 18/19 19/20 18/19 19/20 CY2018 CY2019 CY2020 CY2018 CY2019 CY2020 CY2018 CY2019 CY2020 CY2018 CY2019 CY2020 Financial Data & Analytics S&P Global 52,632 57,327 4% 6% 4% 7% 51% 51% 51% 9.2x 8.8x 8.3x 18.1x 17.4x 16.2x 33.5x 23.7x 21.5x Moody's 34,674 39,726 5% 6% 6% 8% 47% 48% 48% 8.9x 8.5x 8.0x 18.8x 17.8x 16.5x 32.7x 23.2x 20.9x Thomson Reuters 31,803 32,966 8% 4% 35% 32% 20% 25% 31% 6.0x 5.6x 5.3x 30.6x 22.7x 17.2x n.m 54.3x 33.0x Experian 27,139 30,233 4% 8% 2% 9% 34% 34% 34% 6.2x 6.0x 5.6x 18.3x 17.9x 16.4x 43.8x 29.6x 25.7x IHS Markit 22,942 28,422 11% 6% 33% 8% 33% 40% 41% 7.1x 6.4x 6.0x 21.5x 16.1x 14.9x 64.1x 22.5x 19.9x Verisk Analytics 22,913 25,625 7% 7% 17% 8% 44% 48% 48% 10.7x 10.0x 9.3x 24.5x 21.0x 19.4x 52.1x 31.7x 28.6x MSCI 18,630 20,754 8% 10% 11% 11% 53% 55% 56% 14.5x 13.4x 12.2x 27.2x 24.5x 22.0x 53.2x 35.0x 30.7x TransUnion 12,274 16,262 13% 8% 25% 10% 35% 39% 40% 7.0x 6.2x 5.7x 19.8x 15.9x 14.4x 54.4x 24.7x 21.6x FactSet 10,638 10,968 6% 6% 14% 8% 33% 36% 37% 8.0x 7.5x 7.2x 24.0x 21.1x 19.5x 44.6x 28.4x 25.6x Black Knight 8,373 10,066 7% 8% 63% 10% 33% 50% 51% 9.0x 8.5x 7.8x 27.7x 17.0x 15.5x 60.8x 29.0x 25.1x FICO 8,578 9,324 9% 9% 44% 14% 23% 31% 32% 8.8x 8.0x 7.4x 37.8x 26.3x 23.1x 74.9x 39.1x 33.9x Morningstar 5,974 5,771 n.a. n.a. n.a. n.a. 26% n.a. n.a. 5.7x n.a. n.a. 21.4x n.a. n.a. 44.7x n.a n.a CoreLogic 3,162 4,959 (6%) 1% 20% 7% 22% 28% 30% 2.8x 3.0x 2.9x 12.7x 10.6x 9.9x 31.5x 15.7x 13.9x Envestnet 3,471 3,774 12% 17% 122% 24% 11% 21% 23% 4.6x 4.2x 3.6x 43.3x 19.5x 15.7x n.m 31.5x 25.2x LiveRamp 3,544 2,482 (64%) 27% n.a. n.a. 7% (18%) 2% 2.6x 7.2x 5.7x 36.4x n.m. n.m. n.m n.m n.m BlackLine 2,830 2,716 23% 22% n.a. 59% (5%) 8% 10% 11.9x 9.7x 8.0x n.m. n.m. 78.8x n.m n.m n.m Mean 3% 10% 30% 15% 29% 33% 35% 7.7x 7.5x 6.9x 25.5x 19.0x 21.4x 49.2x 29.9x 25.0x Median 7% 8% 20% 9% 33% 36% 37% 7.5x 7.5x 7.2x 24.0x 17.9x 16.5x 48.4x 29.0x 25.2x 24 Source: CapitalIQ as of 31 May 2019 Trading comparables – Payments Market Cap (USDm) EV (USDm) Revenue Growth EBITDA Growth EBITDA Margin EV / Revenue EV / EBITDA P/E Company 31/May/19 31/May/19 18/19 19/20 18/19 19/20 CY2018 CY2019 CY2020 CY2018 CY2019 CY2020 CY2018 CY2019 CY2020 CY2018 CY2019 CY2020 Payments High Growth Omnichannel Payments PayPal 128,949 123,099 16% 18% 68% 21% 18% 25% 26% 8.0x 6.8x 5.8x 45.0x 26.9x 22.3x 82.1x 36.8x 31.2x Shopify 30,642 28,749 41% 33% n.a. 86% (6%) 4% 6% 26.8x 19.0x 14.3x n.m. n.m. n.m. n.m n.m n.m Square 26,203 26,159 (31%) 34% 2162% 56% 1% 18% 21% 7.9x 11.5x 8.6x n.m. 62.7x 40.2x n.m 81.5x 54.6x Adyen 23,779 22,390 (70%) 36% 45% 40% 11% 53% 55% 12.2x 40.9x 30.1x n.m. 76.7x 54.6x n.m 113.5x 80.6x Wirecard 19,297 17,456 29% 26% 33% 32% 28% 29% 31% 7.6x 5.9x 4.7x 26.8x 20.2x 15.3x 58.6x 33.7x 24.8x Pageseguro 10,480 9,863 130% 22% n.a. 33% (13%) 35% 38% 14.6x 6.4x 5.2x n.m. 18.2x 13.7x 51.8x 26.9x 21.0x Mean 19% 28% 577% 45% 6% 28% 30% 12.8x 15.1x 11.4x 35.9x 40.9x 29.2x 64.2x 58.5x 42.4x Median 23% 29% 57% 36% 6% 27% 28% 10.1x 9.2x 7.2x 35.9x 26.9x 22.3x 58.6x 36.8x 31.2x General Payments & Services Worldpay 37,827 45,407 9% 9% 39% 14% 39% 50% 52% 11.6x 10.6x 9.7x 29.3x 21.1x 18.6x n.m 25.9x 22.3x First Data 23,989 43,693 4% 6% 11% 7% 35% 38% 39% 5.0x 4.8x 4.6x 14.2x 12.8x 11.9x 37.5x 16.1x 14.2x TSYS 21,861 25,780 1% 7% 31% 8% 28% 36% 36% 6.4x 6.4x 5.9x 23.0x 17.5x 16.3x 49.3x 25.3x 22.3x Worldline 10,926 11,197 38% 7% 69% 9% 21% 26% 26% 5.8x 4.2x 4.0x 28.1x 16.6x 15.3x 50.9x 34.6x 29.3x Nexi 6,088 10,023 (38%) 7% n.a. 19% n.a. 47% 53% 5.7x 9.2x 8.6x n.a. 19.4x 16.3x n.m 26.5x 21.8x Cielo 4,647 6,955 (6%) 2% (28%) 9% 39% 30% 32% 2.3x 2.5x 2.4x 6.0x 8.3x 7.6x 6.2x 8.5x 8.3x Ingenico 4,930 6,663 22% 6% 23% 9% 18% 18% 19% 2.3x 1.9x 1.8x 12.8x 10.4x 9.5x 23.9x 15.1x 13.8x Network International 3,508 3,870 12% 13% 30% 18% 42% 49% 51% 13.0x 11.6x 10.3x 30.9x 23.7x 20.2x 0.0x 33.9x 28.9x EVO Payments 950 1,780 2% 9% 151% 14% 11% 28% 29% 3.2x 3.1x 2.8x 27.8x 11.1x 9.8x 18.2x 51.4x 40.4x Mean 5% 7% 41% 12% 29% 36% 37% 6.1x 6.0x 5.6x 21.5x 15.7x 13.9x 26.6x 26.4x 22.4x Median 4% 7% 31% 9% 32% 36% 36% 5.7x 4.8x 4.6x 25.4x 16.6x 15.3x 23.9x 25.9x 22.3x Payment Networks Visa 352,568 363,138 (9%) 11% 16% 13% 55% 71% 72% 14.1x 15.5x 13.9x 25.4x 22.0x 19.5x 42.5x 29.0x 24.9x Mastercard 256,877 256,503 12% 13% 14% 15% 60% 61% 62% 17.2x 15.3x 13.5x 28.8x 25.2x 21.8x 50.2x 33.1x 28.0x Mean 1% 12% 15% 14% 57% 66% 67% 15.6x 15.4x 13.7x 27.1x 23.6x 20.6x 46.33 31.0x 26.4x Median 1% 12% 15% 14% 57% 66% 67% 15.6x 15.4x 13.7x 27.1x 23.6x 20.6x 46.33 31.0x 26.4x Mean (ALL) 9% 15% 190% 24% 24% 36% 38% 9.6x 10.3x 8.6x 24.9x 24.5x 19.5x 39.3x 37.0x 29.1x Median (ALL) 9% 11% 32% 15% 24% 35% 36% 7.9x 6.8x 5.9x 27.3x 19.8x 16.3x 45.9x 31.0x 24.8x 25 Source: CapitalIQ as of 31 May 2019 Market Cap assumed a proxy for Enterprise Value in multiples analysis Trading comparables – Online Lenders Market Cap (USDm) EV (USDm) Revenue Growth EBITDA Growth EBITDA Margin EV / Revenue EV / EBITDA P/E Company 31/May/19 31/May/19 18/19 19/20 18/19 19/20 CY2018 CY2019 CY2020 CY2018 CY2019 CY2020 CY2018 CY2019 CY2020 CY2018 CY2019 CY2020 Online Lending LexinFintech 2,001 2,426 239% 10% 43% 36% 71% 30% 37% 6.4x 1.9x 1.7x 9.0x 6.3x 4.7x 10.4x 5.9x 5.0x Lending Club 1,296 1,296 12% 12% 40% 33% 13% 16% 20% 1.9x 1.7x 1.5x 14.0x 10.1x 7.6x n.m n.m 67.0x Fundinc Circle 1,031 1,031 41% 38% n.a. n.a. (30%) (14%) (5%) 5.8x 4.1x 3.0x n.m. n.m. n.m. n.m n.m n.m Ondeck 305 305 n.a. 8% n.a. 25% n.a. 10% 12% n.a. 0.7x 0.6x n.a. 6.6x 5.3x 13.8x 8.9x 7.6x Mean 24% 14% 44% 22% 20% 21% 26% 6.4x 5.9x 5.2x 25.1x 16.4x 21.2x 45.6x 26.0x 27.3x Median 8% 10% 40% 15% 23% 29% 31% 6.4x 7.4x 6.3x 24.0x 17.9x 16.1x 46.5x 29.0x 25.2x 26 Key sector takeaways Recent Fintech transaction trends Public market Fintech analyses Fintech CEO & Investor commentary 1 2 3 4 6 Appendix B: GP Bullhound Fintech credentials & team Appendix A: Fintech trading comparables by category 5 27 GP Bullhound’s recent Fintech activity Private Placement Private Placement Investment from Sold to Private Placement Investment from Investment from Investment from Secondary Sold to Private Placement Sold to Private Placement Private Placement Sold to Sold to Sold to Private Placement Private Placement Sold to Private Placement Sold to IPO €343m Private Placement 28 FLORIS BACKER Executive Director Floris.Backer@gpbullhound.com CLAUDIO ALVAREZ Partner Claudio.Alvarez@gpbullhound.com ADAM PAGE Associate Adam.Page@gpbullhound.com ALEXIS MAJOS Analyst Alexis.Majos@gpbullhound.com Authors 29 No information set out or referred to in this research report shall form the basis of any contract. 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