British Pearl

Idea

Introduction

British Pearl is a FCA authorised investment manager enabling hassle-free fractional international investment in property via its online platform.

We make property investment accessible, easy and liquid.

Accessible – You can invest in specific properties as a shareholder or a lender from £1,000, thereby becoming a landlord or a mortgage provider.

Easy – Invest in under four minutes, you can go from registration to purchasing shares or loans in a property of your choice.

Liquid – Resale Market offers investors a source of liquidity by allowing them to list their buying and selling intentions and automatically executing transactions as they match.

Diversification – We provide our investors the ability to fine tune their investments to meet their risk/return needs. You can buy shares and loans across multiple property types (new build, refurbishment, high yield, development and commercial) across the UK and soon internationally.

Intended impact

Consumer investment

Problem: Property investment is expensive, time consuming, requires expertise. Saving returns negative with inflation. Investments can be opaque, volatile, difficult to understand

Solution: Affordable, transparent, hassle-free property investment

International/Institutional investor

Problem: Require credible service providers delivering attractive returns

Solution: Institutional grade due diligence and operations not available from property companies. Better risk adjusted returns

Property company

Problem: Challenging sales and stricter lending

Solution: Additional sales and financing channel essential to de-risking their operations

How we do it

1. Originate and underwrite attractive investments

2. Registration to investment in minutes

3. Buy shares + loans in seconds

4. Provide Resale Market exchange

5. Easy portfolio management tools

Unlike intermediary platforms we are responsible for investment performance and take delivering on forecasted returns seriously

Substantial accomplishments to date

1st trading year achievements

· 2,400 registered investors of which 430 purchased £2.5m of property shares & loans

· Investors from 28 countries

· ≈ £90k sold through Resale Market representing 9% of available investments

· Investors increase investment balances by 155% within six months of initial investment

· Customer satisfaction with excellent Trust Pilot customer rating

· 20 properties worth £3m purchased. 80% of portfolio sold to registered investors

· Interest (4.2% p.a.) and dividends (3.3% p.a.) distributed in line with forecasts

· Accomplished 11% average property purchase discount to market valuation

· Market leading software enables property securities origination, trading, portfolio management, automated KYC, execution, clearing and cashflow management. We understand that we are the only property investment platform with Open API.

· HMRC approved ISA provider

International joint venture progress

· Hong Kong. Company incorporation started

· USA early stage discussions

· EU early stage discussions

Recognition

· AliBaba Entrepreneurs Fund global competition finalist, Feb 2020

· Hong Kong FinTech global competition finalist, Nov 2019

· BuiltWorld Expo Real European runner up, Oct 2019

· 10 award nominations, 3 speaker engagements, 20+ media features including The Times, the BBC, The Independent, the Daily Mail

Capital raise

From professional investors including Lord Fink: £5.8m equity capital raised into British Pearl and £3.1m into a separate property underwriting vehicle accessible by British Pearl's investment management team.

Monetisation strategy

As an investment manager and property investment platform provider we operate two revenue models. A fund management model and a service model for joint venture relationships

Fund management

· Includes charges to the investors and funds i.e. the ring-fenced property SPVs we manage

· Share investor purchase fees are 2%, no annual fees and a 20% success fee on realised capital gains

· Loan investor purchase fees are zero

· Investor sale fees (Resale Market) are 1% on shares and 0.5% on loans

· Investor and property SPV fees equate to average revenues of approximately 2% per annum of the investment amount

Fees have been designed to be fair, competitive and to align our interests with our investors. All returns are presented net of all expenses and fees. Fees are clearly stated on the how it works page and detailed in the FAQs

Service model

Our service model is bespoke to each joint venture and includes operator (headcount and transactional), annual investment management and license fees.

Use of proceeds

Funds raised to be used for working capital to achieve the following:

Improve sales - 30%

Implement commission-based UK corporate partnerships and international joint ventures into the EU, USA, Asia, Middle East and Commonwealth countries. We are in a number of early stage joint venture discussions.

Extend property sourcing - 10%

Sourcing properties in the EU and USA through partnerships. We are in early discussions with companies in both territories

Investment platform feature development - 30%

We're building our investment platform to be market leading, our software development roadmap includes:

· New markets e.g. integrating Hong Kong banking and KYC services

· Fund manager and intermediary interface

· Extend API

· Open banking

· Security Token Offering

The remaining 30% of funds raised will be spent on other headcount, general operating and administrative expenses

This fundraising round precedes what we expect to be a larger and higher priced post—Brexit fundraising round in 2020

Please note that the company has a £200k convertible loan held by the CEO. The potential dilutive effect of this loan has been included in the pre-money valuation of the campaign. The funds raised will not be used to pay this loan.