Pinnacle Disability Deck

Pinnacle's pitch deck.

Transcript

1. Representing Disabled Americans before the Social Security Administration Confidential
2. History 2 While the OASDI (Old Age, Survivors, and Disability Insurance) program was created in the 1935, the benefits wouldn’t include those for Disability for another 20 years when in 1956, Congress established the first operating disability program under the Social Security Act.* • 1958 – 1999 Social Security continues to amend and expand the Disability Benefits program • 1974 - Supplemental Security Income program is launched • Sections 206(b) and 1631(d)(2) of the Social Security Act enables an attorney or advocate to be compensated directly by the SSA for successful representation of a client seeking SSDI or SSI benefits, as well as reimbursement for reasonable fees.^ • The attorney's fee may not exceed 25 percent of the claimant's title II and/or title XVI past-due benefits and is capped at $6,000.^^ • There is a direct positive correlation between the national unemployment rate and the number of those seeking SSDI and/or SSI benefits** *https://www.ssa.gov/legislation/DI%20legislative%20history.pdf ^https://www.ssa.gov/representation/rep_fees_before_a_court.htm **https://www.ssa.gov/policy/docs/ssb/v66n3/v66n3p1.html ^^https://www.ssa.gov/pubs/EN-05-10075.pdf
3. Market 3 • Over 2 million Americans file for disability benefits annually,* • The average wait time for a hearing is about 500 days nationally^ • On average 70% of Initial applicants are declined, however the Office of Disability Adjudication and Review (ODAR) found that claimants who had legal representation had a 29% greater chance of winning their case. • Over the past decade, 2007 – 2017, the average annual total fees paid to Claimant Representatives by the SSA has been $1.24B.*^ *disabilityjudges.com , ^https://www.ssa.gov/policy/docs/statcomps/di_asr/2016/sect04.pdf, *^https://www.ssa.gov/representation/statistics.htm
4. Social Security Disability Benefits 4 • SSD is a monthly benefit for disabled Americans who meet the criteria of disability under the SSA Regulations. • Recipients have paid into “the system“ via FICA and Social Security tax withholdings. • SSI is a monthly benefit for disabled Americans or Americans over 65 with limited resources/income – the “welfare” type recipients • They must also satisfy the mandates of the SSA Regulations defining disability. Social Security Disability Title II Benefits Supplemental Security Income Title XVI Benefits
5. Competition 5 • Out of the roughly 3,200 firms in the Disability Representation space, the vast majority are small shops or they are a small portion of a larger law firms’ business. • The average firm earned just over $383M in 2013.^ • On average, the top 10 firms earn just over $19MM in fees annually.** • 95.3% of all firms have less than 5 Claimant Representatives • The top five largest firms in the space are:  Myler Disability  Citizen’s Disability  Premier Disability  Pond Lehocky  Freedom Disability *https://www.wsj.com/articles/SB10001424052970203518404577096632862007046 ^https://oig.ssa.gov/sites/default/files/audit/full/pdf/A-05-15-15017.pdf **https://oig.ssa.gov/sites/default/files/audit/full/pdf/A-05-15-15017.pdf
6. Opportunity 6 • Pinnacle Disability’s Management has 15 years successfully representing over 1,000 SSDI and SSI cases. • Similar operations, finance, and marketing requirements with sister entities enables a shared environment and reduces overhead. • Consistent marketplace volume which improves with an increase in unemployment associated with economic downturns. • Marketing strategy leverages direct response, digital, lead aggregators, and relationship marketing to build cross-product brand awareness, increase marketing efficiencies, and reduce marketing risk. • Key business statistics:  2017 Average Claim Paid: $3,149  Average claim resolution in 16 months  29% higher win rate  Returns in excess of 25%
7. Summary Financials 7 Summary 5-Year Year 1 Year 2 Year 3 Year 4 Year 5 TOTAL Total New Leads 16,535 21,208 32,711 39,151 39,151 148,757 Total New Cases 1,774 2,323 3,748 4,519 4,603 16,967 11% 11% 11% 12% 12% 11% Operating Income Fee award revenue at initial $325,201 $945,770 $1,371,226 $1,944,936 $2,208,186 $6,795,321 Fee award revenue at recon $21,754 $191,324 $268,234 $411,499 $494,487 $1,387,297 Fee award revenue at hearing $0 $510,985 $1,437,521 $2,087,876 $2,944,915 $6,981,296 Other Revenue $0 $0 $0 $0 $0 $0 Total Revenue $346,955 $1,648,080 $3,076,981 $4,444,311 $5,647,587 $15,163,914 Operating Expenses $1,369,929 $1,760,121 $2,364,318 $2,710,694 $2,914,066 $11,119,128 EBITDA ($1,022,974) ($112,041) $712,663 $1,733,617 $2,733,522 $4,044,786 EBITDA Margin 0% 0% 23% 39% 48% 27% Marketing Metrics Cost Per Lead $44 $39 $31 $26 $26 $31 Cost Per New Case $411 $352 $268 $226 $222 $271 Operating Metrics Open Caseload at year end 747 1,168 1,823 2,306 2,427 Open case value at year end 1,845,169 $ 2,884,674 $ 4,500,764 $ 5,692,665 $ 5,991,973 $ Average case value at year end1 2,469 $ 2,469 $ 2,469 $ 2,469 $ 2,469 $
8. Management Bios FARVA JAFRI: Prior to starting Looking Glass, Farva built a specialty finance company with over 50 employees and three product lines, spanning Florida, Georgia, Illinois and New York. While she served as COO, the sales team originated $4.5MM over the course of a year. Farva also served as regulatory lead and Chief Author Representative at a health data and analytics startup called Apervita. In her role, Farva liaised with academic medical centers (AMCs), regulatory bodies like the FDA and CMS, and large health IT enterprises such as GE healthcare. Her focus on medical devices and regulatory & policy engagement helped Apervita gain significant headway amongst key stakeholders in Congress and within administrative bodies. Furthermore, by working closely with leading authors from AMCs such as the Mayo Clinic, Cleveland Clinic, Johns Hopkins University and the University of California, Farva served a key role in building the first two-sided marketplace for health data and analytics. Farva has a varied legal background, and has experience in criminal law, banking foreclosure and intellectual property. Additionally, she has served as the executive director of a non-profit, international consulting organization spanning six countries (Israel, the United States, Sweden, Taiwan, Singapore and South Korea), and chairwoman of another non-profit, arts-oriented organization based in the Middle East. Farva holds a J.D. and M.B.A. from the University of Illinois at Urbana-Champaign, a M.P.H. from the Keck School of Medicine at the University of Southern California and a B.A. from New York University. 8
9. Management Bios MICHAEL OLSEN: The CMO of Looking Glass Financial and President of Looking Glass Financial’s legal funding arm has more than 25 years experience holding executive leadership and general management positions driving growth and enterprise value for start-up ventures and Fortune 500 companies across multiple industries including specialty financial services, retail credit, media, automotive, tax services, and legal. He has led marketing, product management, operations, data analytics, and client development functions, as well as managing the growth of P&Ls up to $75 million, and marketing budgets up to $15 million. Most recently, he was a Co-Founder of Signal Funding, a legal funding company that grew from zero to $5.3MM in originations in twelve months, as well as a consultant helping small to medium-size businesses revitalize their growth through optimization of marketing, operations, and analytics. Prior, he was the CMO of Oasis Financial, where he built and led the national B2B and B2C marketing function to grow the organization to become the largest national brand in the country. He also led strategic growth initiatives while at Citigroup’s private label retail credit division and GE Capital’s Partnership Marketing group. He holds a B.S. in Advertising from Ferris State University and a M.S. in Direct Marketing from Northwestern University. 9
10. Management Bios 10 DIANA GRAMENOS Diana Gramenos is the President and COO of Pinnacle Disability and brings 10 years of SSD practice to the table, along with a lifetime of exposure to SSD as her father was an Administrative Law Judge for the SSA for over 30 years. She began her solo SSD practice when she handled her first Appeals Council case and was able to capture over $50,000 in retroactive pay for her first client. She then moved from Michigan to Chicago and built an in-house SSD practice in a prominent Chicago Workers’ Compensation firm. She was then recruited by a well-known legal funding business to build an in-house SSD practice, from which she spun out to raise a half a million dollars in funding and launched a new SSD business, Disability Corner, LLC. While operating Disability Corner, LLC she has recovered millions in retroactive benefits to over 1000 clients nationwide and received over $2 million in attorney fees. She earned her Bachelors Degree in Journalism from Eastern Michigan University and her Juris Doctorate from Western Michigan University, Thomas M. Cooley Law School.
11. Management Bios 11 SHREYAS VENKATASUBRAMANIAM Shreyas Venkatasubramaniam is a co-founder and the Head of Lago Six’s Quantitative Investments, and is also Looking Glass Financial’s CFO. He is responsible for evaluating quantitative strategies to manage risk, allocate assets and portfolio management for a variety of asset backed securities. He is also a member of Lago Six’s Management and Investment Committees. Mr. Venkatasubramaniam has extensive quantitative experience in alternative credit investing and executing specialty finance and corporate transactions. He has deep experience in building quantitative strategies for a variety of asset backed securities including equities, marketplace loans and other fixed income assets. Prior to co-founding Lago Six, he was the Head of Quantitative Research and Capital Markets at Argon where he was responsible for building machine learning algorithms using Big Data analytics to improve the decision engine and optimize capital structures. He performed highly structured, esoteric transactions in securitization and special situation opportunities, supported by a strong background in credit and leverage finance. He serves as an adviser to several start-ups where he provides business strategies and design thinking. Mr. Venkatasubramaniam holds a Bachelor of Engineering degree with Honors in Electrical and Electronics Engineering and a Master of Science degree in Financial Engineering from the University of Illinois, Urbana-Champaign. He sits on the board of several non-profits and is a familiar face in the Chicago tech community.
12. Management Advisors 12 KEN YAGER Ken has 25 years of executive leadership experience in stakeholder communication. Mr. Yager regularly takes on profit and loss and risk-management responsibility for cash-constrained companies in growth, leveraged-buyout and turnaround situations. He also has successfully worked on implementing dozens of initiatives involving, operations and project management, team building, marketing, and sales and joint-venture management. He is a fierce advocate for capital preservation and saving jobs. Ken has worked with clients in a variety of industries in over 100 engagements. Prior to Newpoint Advisors, Mr. Yager was a Principal at MorrisAnderson, a national turnaround management firm focused on assisting companies deal with severe liquidity issues and insolvency. Mr. Yager previously held positions at Newpoint Ventures, a company dedicated to revitalizing middle-market companies through new management and the introduction of low-cost employee leveraging tools; Equity Sponsor Business Development at Bank of America; The Assurance practice of Coopers & Lybrand and the Capital Markets Division of Salomon Brothers. Ken earned a Bachelor’s degree in Management with majors in Finance and Accounting from Tulane University, A.B. Freeman School of Business, and received a Master of Management degree from J.L. Kellogg Graduate School of Management.
13. 13 DAN KRAUT Dan has 20 years of general management, product management, sales, and marketing experience at both large and early-stage consumer financial technology (FinTech) and SaaS-based business service companies. He founded Viola, an Internet-based personal investing service, purchased by Intuit and co-founded KEEPS America, a provider of prepaid debit cards to unbanked consumers receiving lawsuit settlements or disability benefits through their law firms. Prior to that, Dan was President of E*TRADE Financial’s Corporate Services unit where he turned a $1 million loss to a $24 million profit in two years’ time, increasing revenue 34% to $90 million. He also led E*TRADE’s online advice (robo advisor) initiative and fidelity.com's retail brokerage product management efforts. Dan has lived and worked in New York, San Francisco, Boston, the UK, and Israel. Dan holds a BS in electrical engineering from Cornell University and an MBA from MIT’s Sloan School of Management. BRIJ SHAH Brij is a strategy and product management leader with over 20 years experience in financial services and management consulting. Brij is currently Vice President of Group Strategy at Fiserv, Inc. (NASDAQ: FISV). Brij built the strategy group in the Billing and Payments group and oversees strategy for businesses with total revenues over $2B. Prior to Fiserv, Brij was an Engagement Manager at McKinsey & Company advising CEOs and CIOs on growth strategy and operational excellence initiatives. Prior to McKinsey, Brij led product management for FactSet Inc.’s fixed income analytics business. Brij arrived at FactSet with acquisition of Derivative Solutions, a start-up he helped grew from $1M to over $10M in revenue in his engineering and sales roles. Brij started his career in India working for small family businesses (diamonds, steel and textiles). Brij holds a BA in computers from DePaul University and an MBA from Northwestern’s Kellogg School of Management. Management Advisors