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Social Finance and the end of traditional banking

January 2013 – MIT Forum

Yoni Assia Co-Founder & CEO

2 30-Jan-13 30-Jan-13 2 eToro©2010 Presentation materials are confidential and should not be copied, distributed or passed on, directly or indirectly, to any other person.

Finance is BIG and ready for disruption

In billions of revenues 2010 figures

CNNMoney

Financial services,

$2,760.05

Aerospace, $129.97 Agriculture, $315.38

Automotive, $1,443.53

Conglomerate, $1,156.03

Health, $834.55

IT, $381.33

Insurance, $670.57 Oil and Gas, $3,962.45

Retailing, $1,844.08

Telecommunications, $757.27

Financial services

Aerospace

Agriculture

Automotive

Conglomerate

Health

IT

Insurance

Oil and Gas

Retailing

Telecommunications

Global Revenues by Sector ($b)

“When I was young I thought that money was the most important thing in life; now that I am old I know that it is.” Oscar Wilde

30-Jan-13 3 eToro©2010 Presentation materials are confidential and should not be copied, distributed or passed on, directly or indirectly, to any other person.

Banks are currently focused on reducing costs and risk

After the crisis, banks are focused on:

Centralization aligned with de-risking

Reducing counterparty risk & operational risk

Increasing levels of change & regulations

Increasing corporate client expectations

Desire to address legacy expenses

Source: Deutsche Bank

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Banking is boring

Banks focus on reductions makes them overlook the fact…

“ “ Institutions will try to preserve the problem to which they are the solution.

Clay Shirky

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Banks have to adjust to the new age of networks

Industrial Economy

200 Years

50 Years

1750 1850 1950

1771: The industrial revolution

1829 The age of steam and railways

1875 The age of electricity

1908 The age of mass production

1971 The age of information

Information Economy

2006 The age of social networks

2012

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Consumerization (Added Value on consumers)

Social Gamification

Globalization – One brand for ALL

“Appli”-fication - Everything as a service

Open networks of (Big) data – No secrets

The new age of networks is driven by various trends

7 30-Jan-13 30-Jan-13 7 eToro©2010 Presentation materials are confidential and should not be copied, distributed or passed on, directly or indirectly, to any other person.

So how do information and networks change our world?

Information paradigm

Distributed

Abundance

Talent

Web products UX

Resilience

Industrial paradigm

Vertically integrated

Scarcity

Financial capital

Financial Products

Scale

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Networks growth is staggering

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Users connectivity is going to double itself

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Where are we on the Solical Era Cycle

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Social financial services are emerging and growing

Sean Park, Anthemis Group

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Payments Services

Sean Park, Anthemis Group

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Payments Services – One new global currency ?

Sean Park, Anthemis Group

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Personal Finance – Manage your expenses

Sean Park, Anthemis Group

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Risk Management

Sean Park, Anthemis Group

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Wealth Management

Sean Park, Anthemis Group

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Business Banking

Sean Park, Anthemis Group

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Investments

Sean Park, Anthemis Group

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eToro is the #1 social investment network that allows users to invest in a

fully transparent & engaging community by sharing and copying from one another

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Copying and sharing using eToro’s OpenBook

21 30-Jan-13 30-Jan-13 21 eToro©2010 Presentation materials are confidential and should not be copied, distributed or passed on, directly or indirectly, to any other person.

eToro has changed investments as we knew them

Investing through a bank / broker

“Boring”

Knowledge required

Private and local

Social investments with eToro

Social and exciting

Using the wisdom of the crowd

Open global community with 2.5

million users form 200 countries

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Thank You

“ “ You never change things by fighting the existing reality. To change something build a new model that makes the existing model obsolete.

Buckminster Fuller

Yoni Assia CEO

yoni@eToro.com Tel: +972 54 4277789