An Overview Of Pacaso As A Marketplace For Second Home Co-Ownership

Can you give us an overview though of Pacaso as a marketplace and maybe touch on some of the unique aspects of it? Yeah. So we think about the business like a tech-enabled marketplace that connects empty second homes with aspiring homeowners who either can't afford or can't justify owning 100% of a home that they're only going to use 10% of the time. Historically, Most of the supply that we brought on is what I would describe as like first-party supply, where Pacaso is actually buying the house before we resell it to the buyers that we're aggregating on the other side. The long-term goal is to be more of a true third-party marketplace where Pacaso is aggregating the buyers on one side and then matching those buyers with the home. as opposed to Picasso being in the middle of the transaction and buying the alt first. But the reason why we, why historically most of our transactions have been this first-party supply model is because shortly after we launched the business, we basically launched in stealth mode in May of 2020 under a different brand. We didn't officially launch picasso.com until October of 2020. Shortly after we launched, you all may remember that the sort of, well, you may not have realized this if you weren't in the real estate business, but if you were in the real estate business, you would remember that the second home market just blew up in very late 2020 and all of 2021. It was like a rocket ship. I mean, anybody who had money wanted to get out of their home, had the flexibility, or at least more flexibility to work remote. So people were buying homes, you know, in these second home markets at record paces. So it was basically impossible to get any good inventory without buying the home. So we adjusted our business model. You could call it a pivot if you want, but we kind of pivoted our business model away from the original vision of third-party marketplace to first-party marketplace out of necessity. It was the only way to get good supply at the time. Now that the market has returned to a place that's more representative of normal, we're returning back to the original vision of third-party marketplace. In addition to kind of the basic marketplace functionality of connecting supply and demand, there are a couple of other things that are pretty unique about our business. Not really sure how to describe it in a In like a perfectly technical sense, but I'll just loosely describe it as there's a whole bunch of services that we have to provide in order to make this co-ownership model work. Connecting buyers and sellers is just one of the services, but there's a bunch of other services like managing the properties, financing the properties. You know, 70% of people who buy a Pacaso use financing. Prior to Pacaso, there was no such thing as the co-ownership loan. So we invented the co-ownership mortgage, and Pacaso is the bank for all the people, effectively the bank. We, technically speaking, we partner with other banks, but we're like originating all these loans. We're also the reseller for partial interest in homes. Meaning if you, let's say that you and 3 of your closest friends or family members wanted to buy a home together, you could obviously go do that on your own without Pacaso. But if one of you wants out, Like if you own a fourth of a home with 3 other people and one of you wants out, good luck. You know, prior to Pacaso, there was no market for that. You couldn't just go out and sell a fourth of a home. Now you can. We created a secondary market for partial interest in homes for the first time. So all these other little services that layer onto our marketplace are a really important part of our strategy long-term. And while we do pretty well on the first transaction because we charge a little markup on the real estate, the real opportunity that we have is in the recurring revenues that compound into the future. Because once a home becomes a Pacaso, it stays in our marketplace indefinitely.