Understanding and Engaging the UHNW. David Friedman CEO & Founder, LifeChain

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1 Understanding and Engaging the UHNW David Friedman CEO & Founder, LifeChain

2 Most Complicated Wealth Design in History Where a man s wealth is, there is his heart also ~Ancient Proverb Human Capital: 700 Wives 300 Concubines

3 Money is a Narrative

4 Most Expensive Car Crash

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6 Some Budgets Are Bigger

7 Even Bigger Budgets

8 Background

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10 Key Trends Shaping the Wealth Landscape Understanding What is Driving Change The World of Wealth

11 Will Robots replace the Middle Class?

12 Community: clicks back to bricks

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14 The Wealth Pivot: China to Chicago, the New Emerging Market for Luxury Chinese anti-corruption purge has facilitated major pull back Macao revenues have shrunk for the first time Conspicuous and over luxury is receding This is going to hit hard, said David Friedman, the president of Wealth-X, a luxury intelligence firm. Mr. Friedman, who is based in New York, added, It s the straw that breaks the camel s back for luxury brands that looked at the Chinese consumer as a driver of their revenue growth. Is the Chinese consumer still incredibly important to luxury brands? The answer is absolutely yes. But is the Chinese consumer over the next several years going to be the same economic juggernaut of consumption for these brands? The answer is no.

15 From Assets to Platform for Luxury Experiences

16 Facebook: Social Graph The Graphs of Life

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19 Global Wealth Graph

20 Risk & Philanthropic Graph

21 Risk & Wealth - Converging

22 Wealth & Risk The emergence of hyper polarized wealth in emerging economies is closely linked with traditional risk and compliance issues AML/KYC Casinos Auction Houses Enlightenment Publishing Cyprus Arkady R. Rotenberg, a judo sparring partner from Mr. Putin s St. Petersburg youth Microsoft 22

23 Luxury Graph

24 Increased Scrutiny

25 Luxury & Risk

26 Luxury Real Estate, CIP and Risk

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28 Passports: The New Asset Class

29 $16 Trillion over Three Decades

30 Retail Sales and Wealth

31 How big is the market & where are these individuals? 31

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33 235K seating

34 211,275 UHNW Individuals US$29.7 trillion UHNW Wealth Source: Wealth-X and UBS World Ultra Wealth Report

35 The Typical UHNW Individual Average Net Worth US$141 million Average Age 59 years Average Liquidity US$35 million Average Number of Children 2 children Source: Wealth-X and UBS World Ultra Wealth Report

36 Concentrated 211,275 individuals 0.004% UHNW Market UHNW Share of the world s population $ 13% of the world s wealth Wealth Management Luxury Non-Corporate Philanthropy US$7,395 billion US$234 billion US$90 billion 37% 19% 18% Source: Wealth-X and UBS World Ultra Wealth Report

37 Where Are The World s Ultra Wealthy? Source: Wealth-X and UBS World Ultra Wealth Report

38 USA Keeps its Pole Position COUNTRY UHNW POPULATION UHNW WEALTH US$ billion 1 UNITED STATES 69,560 9,630 2 GERMANY 19,095 2,580 3 JAPAN 14,720 2,430 4 UNITED KINGDOM 11,510 1,445 5 CHINA 11,070 1,565 Source: Wealth-X and UBS World Ultra Wealth Report

39 1 2 CITY NEW YORK, UNITED STATES LONDON, UNITED KINGDOM UHNW POPULATION CHANGE % 8, % 6, % 3 TOKYO, JAPAN 6, % 4 5 Top 10 World Cities SAN FRANCISCO, UNITED STATES LOS ANGELES, UNITED STATES 5, % 5, % 6 OSAKA, JAPAN 3, % 7 PARIS, FRANCE 3, % 8 HONG KONG 3, % 9 CHICAGO, UNITED STATES 2, % 10 MEXICO CITY, MEXICO 2, % Source: Wealth-X and UBS World Ultra Wealth Report

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42 Virtual Family Office PF 990

43 What are the Pyschographics of Passion Investments?

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47 How do luxury brands try to reach the UHNW?

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50 How does an UHNW individual qualify or assess you? You were introduced by someone that they trust and you are riding off the social capital of their relationship with that individual Common passion, hobby or interest Chemistry

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52 Key Underlying Impulses You have to earn the right to be heard Always looking for Value Shanghai Tang I don t want to be taken for a ride

53 Marc Benioff

54 Why does Marc wear Berluti?

55 The Future is Already Here 55

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58 The Friction of Trust Blockchain does not provide more trust It actually eliminates the need for trust Does this make us better or will it lead to a massive atrophy of our capabilities demanding trust?

59 In our view, companies that conduct some or all of their transactions on the blockchain will enjoy a trust bump in share price. Blockchain Revolution

60 Data is the new asset class one that may trump previous asset classes. Another is the undermining of our traditional concepts of privacy and the autonomy of the individual. Blockchain Revolution

61 The macro drive towards transparency Aeol(automatic exchange of information)

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63 Life Dashboard

64 Redefining Life Insurance

65 David S. Friedman 65