Proof before sent to print

An Exciting

Business Opportunity

The face of real estate has changed – forever.

The story behind this started nearly 20 years ago with wholesale purchasers like We Buy Ugly Homes. Fast forward in time and with the evolution of Big Data, Wall Street dollars and an industry that was left untouched – we now have the largest disruption in residential real estate that’s ever happened.

In 2015 a company called Opendoor launched in Phoenix. By the end of 2016 several other national companies jumped in the Phoenix market to compete including Zillow, Redfin & others. Today we know them as iBuyers. Opendoor alone has spread to over 20 different national markets and on pace to buy & sell 50,000 homes this year.

Their concept is simple. The consumer may not want to go through the traditional process of selling their home. Their solution is to provide the Convenience, Certainty and Control of a cash offer. This allows the consumer to eliminate updates, repairs, staging, showings, inspections, appraisals and all types of uncertainties.

National iBuyers are a mix of Big Data, Big Money and Big Systems. They’re big.. they’re bulky... and they need predictability. Therein lies the opportunity of MarketPass.

MarketPass is a hyper-local iBuyer for the Twin Cities. It takes the national power model of iBuyers, mixes it with local knowledge and is nimble enough to move quick. That local knowledge provides the expertise & adaptability that the big companies can’t.

MarketPass was created by Realtors for both the consumer AND the Realtor. It competes in the same arena the big companies can and goes where they can’t.

National Model + Hyper-Local Knowledge & Expertise =

N TH S BOOK 3-4 5-8 9-10 11-12 13-14 15-16

Market Disruption Market Players The Opportunity The Business Model Your Partner Bio

MARKET DISRUPTION

Big Data changing an industry. Does that sound familiar? What Netfix did to Blockbuster.. what Amazon did to retail.. what Uber did to taxis – this is what iBuyers are doing to real estate.

The residential real estate industry was virtually untouched for decades. Realtors kept control & ownership of listings, information, pricing and all types of industry data. The advent of the internet changed everything. Data is now shared – not owned.

Th

Zillow and many other websites were designed to share that info. Then they adapted to create home valuations. Now the evolution of Big Data has allowed them another rung in the ladder of disruption – cash offers directly to the consumer.

With a little time and effort, the consumer can go to their website to upload information and photos of their property. As long as that property fits the iBuyer model – they’ll produce an offer within 48 hours.

Ope has c 50,0 trans since up...

INDUSTRIES ALREADY CHANGED FOREVER

The Facts

By 2024

Every 34 minutes a house is bought by iBuyers

Opendoor has closed 50,000+ transactions since start up...

out of 10 9consumers recommend

iBuyers

for ease-of-use

300,000 That is

3,000+

transactions per month

Zillow offers have been requested in

2019 YTD

40%

60%

of all sellers already have an iBuyer offer before talking to an agent

of all home sales will be by an iBuyer

250K

Wall St. has now invested

Single Family Rentals are now owned by REITs

BILLION$

to Buy Homes to Rent

MARKET PLAYERS National iBuyers of all kinds are available for the consumer.

Direct offers, home trade in’s & more!

Market Players They’re backed by Wall Street dollars!

AMERICAN

H omes AMHERST

RENEWAL

STARWOOD

c a p i ta l g r o u p

invitation homes

SYLVAN ROADS

The Institutional Investors Strategy Categories of Commercial Real Estate Wall Street Firms Buy

Multi-Family (Apts)

Depressed home prices in The Recession kicked off buying that has increased in billions of dollars spent and committed. New funds are investing in 2020, as demand for rental houses has increased sharply. Investment has shifted to SFR to increase market share from 2% to 20% and due to a shift away from Retail investment and a weakness in Office investments.

Single-Family Homes for Rent (SFR)

Retail + Warehouse

Office

The Race Real Estate Brokerages

OD up

AN S

Realogy Companies

Century 21

Coldwell Banker Sotheby’s

ERA Better Homes & Gardens Re/Max Berkshire Hathaway Home Services EXP Compass Keller Williams Premier Realty Small Independent Brokerages “Cyber” Brokerages

New Disruptors to Real Estate Zillow Redfin iBuyer Model Opendoor Offerpad

Zillow Offers Misc Mortgage Companies Insurance Companies MarketPass

The race is on for realtors & brokerages to adapt. While realtors and brokerages use national vendors to plug into – 1 local office has a different idea. If you connect the hyper-local knowledge of the real estate office with the power model of the iBuyer – this is the adaptation of the future!

THE OPPORTUNITY iBuyers have what are called Buy Boxes. In other words – what are the parameters of what they’ll buy. Due to their size – they only buy “predictable” real estate.

BUY BOXES 1970s or newer

1970s or newer

NOT IN TWIN CITIES

3 Beds / 2 Baths

3 Beds / 2 Baths

1970s or newer

.5 acres or less

.5 acres or less

3 Beds / 2 Baths

$500K or less No adverse settings i.e. busy roads, near airport, etc...

$500K or less No adverse settings i.e. busy roads, near airport, etc...

.5 acres or less $500K or less

The consumer doesn’t fit into a box. The consumer is the same no matter where they live or how they live – they all want Convenience, Control and Certainty in the sale of their home.

WHAT ABOUT THE REST? MINNEAPOLIS

SAINT PAUL

BUILT BEFORE 1970

BUILT BEFORE 1970

Acreage, luxury, urban, rural, townhomes, condos, retirement communities, lots, land... what about all those people?

Y

iBuyers launched in Phoenix in 2015 and are now in 20 national markets and growing. In some markets they’re taking over 4% of ALL residential sales in just a few years. It’s predicated that they’ll represent over 50% of sales by 2025! Twin Cities launch was 2018 and by 3rd quarter only represented .1% of Twin Cities sales. By 3rd quarter 2019 – they jumped to 1.2% of Twin Cities market share. That’s a 1200% increase in 1 year!

MARKET SHARE OF iBUYER SALES Atlanta, GA

7%

Austin, TX 6%

Charlotte, NC Dallas, TX

5%

Denver, CO Houston, TX

4%

Jacksonville, FL 3%

Las Vegas, NV Orlando, FL

2%

Phoenix, AZ Raleigh, NC

1%

San Antonio, TX 0%

Twin Cities, MN

2015

2016

2017

2018

2019

MarketPass is a hyper-local iBuyer managed by Realtors – not computer programs.

The advantages are endless: -No Buy Boxes: MarketPass can make an offer on any property type, any age, any price, any property condition, at any time!

-With its affiliation to Keller Williams Premier Realty – it has 160 realtors at its fingertips that need a local version of this concept!

-Has the ability to create affiliate offices with other Keller Williams franchises around the Twin Cities -Can partner with a local builder to provide seamless transitions for new construction buyers

BUSINESS MODEL FOUNDERS I, LLC

10%

REALTY FUND, LLC

90%

Due to the complexity of this company, our legal team at Chestnut & Carbonne developed a system of (3) LLC’s. Founders I, LLC is owned and managed by the company founders. Realty Fund, LLC is YOU the investor.

Together we will own the face of the company – MarkePass, LLC Founders I, LLC will own a 10% share of the company while Realty Fund, LLC will own the remaining 90%.

The following proforma is based on unit counts. A “unit” defined as a purchase & resale of a home. Our profit margin will be based on the resale value of the home and set at a 4% minimum.

24.00 $ 320,000 $ 7,680,000 $ 215,040 10% $ 21,504

28.00 $ 340,000 $ 9,520,000 $ 266,560 10% $ 26,656

$ 340,000 $ 13,600 $ 1,904,000 $ 125,000 $ 1,779,000

30.00 $ 340,000 $ 10,200,000 $ 285,600 10% $ 28,560

$ 340,000 $ 13,600 $ 2,040,000 $ 155,000 $ 1,885,000

33.00 $ 340,000 $ 11,220,000 $ 314,160 10% $ 31,416

$ 340,000 $ 13,600 $ 2,244,000 $ 175,000 $ 2,069,000

36.00 $ 340,000 $ 12,240,000 $ 342,720 10% $ 34,272

$ 340,000 $ 13,600 $ 2,448,000 $ 175,000 $ 2,273,000

40.00 $ 340,000 $ 13,600,000 $ 380,800 10% $ 38,080

$ 340,000 $ 13,600 $ 2,720,000 $ 185,000 $ 2,535,000

$ 325,000 $ 65,000,000 $ 5,416,667 $ 20,312,500

200 .

44.00 $ 340,000 $ 14,960,000 $ 418,880 10% $ 41,888

$ 340,000 $ 13,600 $ 2,992,000 $ 200,000 $ 2,792,000

$ 325,000 $ 71,500,000 $ 5,958,333 $ 22,343,750

220

2030

$ 465,000 $ 7,560 $ 472,560 $ 141,768 $ 330,792

$ 865,000 $ 13,440 $ 878,440 $ 263,532 $ 614,908

$ 1,175,000 $ 18,200 $ 1,193,200 $ 357,960 $ 835,240

$ 1,411,000 $ 21,504 $ 1,432,504 $ 429,751 $ 1,002,753

$ 1,885,000 $ 28,560 $ 1,913,560 $ 574,068 $ 1,339,492

$ 2,069,000 $ 31,416 $ 2,100,416 $ 630,125 $ 1,470,291

Company Value

$ 1,779,000 $ 26,656 $ 1,805,656 $ 541,697 $ 1,263,959

$ 2,273,000 $ 34,272 $ 2,307,272 $ 692,182 $ 1,615,090

$ 2,535,000 $ 38,080 $ 2,573,080 $ 771,924 $ 1,801,156

$ 2,792,000 $ 41,888 $ 2,833,888 $ 850,166 $ 5,294,429 $ 1,983,722

$ 10,096,264 $ 10,427,056 $ 11,041,964 $ 11,877,204 $ 12,879,957 $ 14,143,916 $ 15,483,408 $ 16,953,699 $ 18,568,790 $ 20,369,946 $ 22,353,667

20.00 $ 325,000 $ 6,500,000 $ 182,000 10% $ 18,200

$ 320,000 $ 12,800 $ 1,536,000 $ 125,000 $ 1,411,000

$ 325,000 $ 58,500,000 $ 4,875,000 $ 18,281,250

180

2029

CONCEPT 7: Cumulative Return Total Profit + Original Investment

16.00 $ 300,000 $ 4,800,000 $ 134,400 10% $ 13,440

$ 325,000 $ 13,000 $ 1,300,000 $ 125,000 $ 1,175,000

$ 325,000 $ 53,625,000 $ 4,468,750 $ 16,757,813

165

2028

$ 135,000 $ 2,520 $ 137,520 $ 41,256 $ 96,264

9.00 $ 300,000 $ 2,700,000 $ 75,600 10% $ 7,560

$ 300,000 $ 12,000 $ 960,000 $ 95,000 $ 865,000

$ 325,000 $ 48,750,000 $ 4,062,500 $ 15,234,375

150

2027

CONCEPT 6: Revenue Less Dividend Revenue 1 ‐ Profit from Sales Revenue 2 ‐ Profit from Referrals Total Less 30% ‐ DIVIDEND to Investors Net Profit

3.00 $ 300,000 $ 900,000 $ 25,200 10% $ 2,520

$ 300,000 $ 12,000 $ 540,000 $ 75,000 $ 465,000

$ 320,000 $ 44,800,000 $ 3,733,333 $ 14,000,000

140

2026

15% 15% 15% 15% 15% 15% 15% 15% 15% 15% 15% $ 3,780.00 $ 11,340.00 $ 20,160.00 $ 27,300.00 $ 32,256.00 $ 39,984.00 $ 42,840.00 $ 47,124.00 $ 51,408.00 $ 57,120.00 $ 62,832.00

20%

$ 300,000 4% $ 12,000 $ 180,000 $ 45,000 $ 135,000

$ 300,000 $ 36,000,000 $ 3,000,000 $ 11,250,000

120

2025

CONCEPT 5: Managemnt Comp 15% commission from above 4 Total Payment to Managers

CONCEPT 4: Activity = more Activity Additional units per listing Avg Sale Price Total Additional Sales Volume Commission ‐ Blended Rate ‐ 2.8% commission back to MarketPass Total Additional Sales Revnue

CONCEPT 3: PROFIT Avg Resale Price Avg Return on Sales Volume # of Sales x Avg Return Less Annual Expenses ‐ Estimated Total Profit

$ 315,000 $ 31,500,000 $ 2,625,000 $ 9,843,750

100

2024

$ 1,289,063 $ 3,867,188 $ 7,000,000 $ 9,843,750 $ 11,250,000 $ 14,000,000 $ 15,234,375 $ 16,757,813 $ 18,281,250 $ 20,312,500 $ 22,343,750 12.77% 37.09% 63.39% 82.88% 87.35% 98.98% 98.39% 98.84% 98.45% 99.72% 99.96%

$ 280,000 $ 22,400,000 $ 1,866,667 $ 7,000,000

80

2023

RULE: No more than 70% leveraged Money in Circulation: Line Above Divided by Cumulative Return

$ 275,000 $ 12,375,000 $ 1,031,250 $ 3,867,188

45

15

2022

$ 275,000 $ 4,125,000 $ 343,750 $ 1,289,063

2021

2020

CONCEPT 2: FUNDS NEEDED Avg Purchase Price APP Volume Divided by 12: avg mo need Avg Turn Time: 3.75 Months

CONCEPT 1: UNIT COUNT Total # of MarketPass Sales

Proforma for $10,000,000 Starting Fund

Proforma Concepts Explained CONCEPT 1 – UNITS SOLD MarketPass will have several pillars of business. The first and foremost pillar of business is its affiliation with Keller Williams Premier Realty (KWPR). KWPR has 160 Realtors, sells nearly 900 listings per year, dominates its area market share and is growing!

Additional pillars of business are other brokerages & offices, single agents and brokers that want & need a local iBuyer.

One of our vendors is GCS Title and will be supplying them with a massive amount of additional business. GCS Title has relationships with 100’s Realtors and top producers in the Twin Cities and will introduce us to select agents as well.

We’ll be working to establish a relationship with a local builder. The synergy between MarketPass and local builders is endless.

CONCEPT 2 – FUNDS NEEDED This concept adapts to the amount of units sold. This shows the amount of investment we need to make that volume work. This proforma is based on a $10,000,000 starting fund.

RULE – Per the guidance of our accounting team at Wells, Schluter & Hanson – we should not leverage our cash reserves over 70% UNLESS we have a line of credit to back us up. The proforma shows a maximum usage of the funds.

CONCEPT 3 – PROFIT! The margin of profit per sale is set at 4%. There will be times this will go well over 4% but for a more conservative approach – we have the proforma set at 4%.

CONCEPT 4 – MORE ACTIVITY This is a fun one! The concept here is that real estate activity leads to more real estate activity. If we have 10 listings, we will get business from that. This is from sign calls, internet leads, open house activity and real estate marketing basics. We will refer that business back to Realtors at KWPR for a referral fee of 25%. MarketPass will take 10% of that.

CONCEPT 5 – MANAGEMENT COMPENSATION How do our managers get paid? Not by salary.. not by eating up our capital to buy homes. They get paid by this ancillary revenue stream CONCEPT 6 – DIVIDENDS MarketPass will pay annual dividends of 30% of revenue.

CONCEPT 7 – CUMULATIVE RETURN We have the potential to increase our initial fund over 2.5X!

RETURN ON INVESTMENT The return on investment will increase depending on how quickly we can maximize the fund’s available cash. A large volume cash will lend the opportunity to franchise or create affiliate offices. A small volume of cash allows us to be selective on the home purchases and model accordingly. Due to the size and flexibility of MarketPass – we can adjust our strategy accordingly.

The sample proforma puts all cash reserves to work within 6 years and creates extremely profitable annual returns in the later years of this model.

TIMEFRAME What’s the timeframe on your investment? – 10 years. This is not a short-term investment and we’re setting the standard that this is a 10-year model. You’ll be able to fully divest from the company after 10 years.

RISK What’s your risk? It’s minimal and what makes this opportunity very attractive!! The investment funds are used for purchasing homes. The investment funds are NOT used for: -Salaries: The management team gets paid by executing ancillary business activity. We’re not using capital to pay ourselves.

-Brick & Mortar: We have no offices, no brick and mortar, no rent. We are Realtors with an established office setting. MarketPass’s activity of buying and selling homes is what we already do.

-Advertising & Marketing: Yes – that’s correct. We don’t have the need for marketing. We are a tool for Realtors to use and we have the office of Keller Williams Premier Realty as an affiliate. That’s 160 Realtors that are waiting for this local option to use.

The expenses are minimal as this company is started from the Realtors within. After we get to 30 units per year, we’ll need to hire staff. Until then, the company will be run by the Realtors within and their teams of admin staff.

YOUR PARTNER Why work with us?

Market Share Totals Total $ Volume (By Office)

250

225

200

DOM 28 Mkt 7.2%

175

$ in Millions

150

125

100

DOM 37 Mkt 3.4%

DOM 36 Mkt 3.0%

75

DOM 43 Mkt 2.9%

DOM 37 Mkt 2.4%

DOM 32 Mkt 2.4%

DOM 30 Mkt 2.2%

DOM 55 Mkt 2.2%

DOM 32 Mkt 2.0%

50

DOM 38 Mkt 1.7%

25

0 Keller Williams Premier Realty 55110

Edina Realty, Inc. 55110

Edina Realty, Inc. 55127

Keller Williams Premier Realty 55125

REMAX Results 55128

List $

REMAX Results 55128

Coldwell Banker Realty

REMAX Synergy

Keller Williams Classic Realty

Sell $

Because we dominate the market.

Realty Group, Inc.

8 7%

oup, Inc.

TEAM Connie Bossard

Broker & Co-owner – Keller Williams Premier Realty Team Lead to 160 realtors at Keller Williams Premier Realty Licensed realtor for 20 years New Construction & Relocation Specialist

Kevin Marois

Realtor – Keller Williams Premier Realty Investor in Flip/Rentals since 2000 Licensed Realtor for 20 years $20,000,000 in annual sales volume 500+ career transactions

Marty Rathmanner

Realtor - Keller Williams Premier Realty Licensed realtor for 24 years 1,000+ career transactions Luxury Home Specialist $35,000,000+ in annual sales volume

Joe Holmes

Realtor – Keller Williams Premier Realty 700+ career transactions Former Owner & Founder of Prosperity Mortgage of MN, Inc. Versed in REO & Institutional Listings & Sales $20,000,000+ in annual sales volume

Larry Eberhard

Realtor - Keller Williams Premier Realty Licensed realtor for 31 years 1,800+ career transactions $25,000,000+ in annual sales volume

Jonathan Wells

Partner - Wells, Schluter, Hanson & Co. Accountant & Business Development Enrolled Agent to practice before the IRS Series 7 & 63 Licensed Licensed Realtor Expert in taxation of Partnerships, C-Corps & S-Corps