Blend Labs, Inc. (BLND) Earnings Call Transcript & Summary

Good morning, everyone, and welcome to Blend's inaugural Investor Day. My name is Bryan Michaleski. I'm the Head of IR here at Blend Labs. My job here for today is pretty simple. I'm going to walk you through just some simple housekeeping items. I'm sure I think a lot of you saw there's some snacks and coffee in the rear. We have bathrooms, 2 bathrooms in the back of the room. They're both generalist bathrooms, so take a pick there. And we have some charging stations underneath the tables here. But we are going to have a break halfway through and we've tried to set up as many as possible. So we do need some juice half way through. Feel free to step over and fill up your laptops there. So just quickly during the presentation today, we will be referring to some non-GAAP measures, which are reconciled to GAAP equivalents in our slides. Note that the GAAP measures are not intended to be a substitute for GAAP results. Certain statements we make today during our presentation regarding Blend and its operations, in particular, its guidance for 2023 and other periods. May be considered forward-looking statements under federal securities laws. The company cautions you that forward-looking statements involve substantial risks and uncertainties and a number of factors which may vary differently from the -- or beyond the company's control. Please refer to the risk factors we've identified in our most recent 10-K, our 10-Qs and other SEC filings. You can find the slides for today' s presentation. They were just posted just now on the Investor Relations web page at investor.blend.com. We are not undertaking any commitments to update these statements if conditions change, except as required by law. Brief -- quick look at the agenda today. We're going to be starting -- following with Nima and Eric's presentation, we'll have a short break. Feel free to get some snacks there. We are asking that you reserve your questions to the end of the presentation. We'll have a Q&A session -- dedicated Q&A session at noon. And lunch will follow shortly afterwards. Now without -- let's get things started without further ado, I'll hand it off to Nima Ghamsari, head of Blend.

Thanks, Bryan. Welcome, everyone, and thank you for joining. For those of you who are on the webcast, thanks for tuning in and for those of you who are here in person at our office in San Francisco, this is where a lot of the things that you will have seen on the screen by the end of the session have been created. So it's really special to have you all here in person today. As Bryan mentioned, we have a number of people speaking today, starting with myself. I'm Nima Ghamsari, one of the founders of Blend, and I'll be talking about our kind of past, present and future. And then you have [ Eric Robel ], who leads our product team, and he's going to talk about the platform and transitioning to a platform company and what that means for our product strategy going forward. [ Seb Joel ] who leads our customer-facing efforts. A lot of what we do as a company is centered around our customers. And so -- and all the amazing things that they do for consumers. And so you'll get to hear that from him firsthand and ending with Amir Jafari, who leads our finance and administration, and he'll walk you through a little deeper look into our finances than we've really shown publicly before. But if there's only 3 things that you take away from today because this is going to be a long day for you all. It's -- I would say, I would first -- Blend is -- we've taken the last few years to become really well set up for success for the long term. The second thing is that part of the reason for that success is that we have made this transition to a platform company, and that allows for us to be -- to serve our customers in new ways and do it much more efficiently than before. And lastly, it's that we're still focused on the here and now. We know the macro is uncertain. And so we're taking actions to make sure that -- and you've seen these actions in the last few years to make sure that we're doing things in the right way in this environment. So if you leave with nothing else, leave with those 3 things. And I don't want you to just take my word for the things that we say we're going to do. I also want to show you what we've been able to do over the last few years as a public company. We went public about 8 quarters ago, and it's an interesting time to go public, a much different environment. And clearly, the world is a lot different than it is now. But we set out really to do 2 things when we went public, which was to grow our customer base, and to do that in both mortgage and expand in consumer banking while building out Blend Builder. And actually, in the last 2 years, we have done those things. We've grown our mortgage base pretty significantly, both in terms of our market share and with the add-ons and additional monetization, our monetization per unit has grown pretty significantly, obviously, with the backdrop of a much smaller market now than it was 2 years ago. And on Consumer Banking, we've continued to grow, and that's an area where we see -- we continue to see growth this year even with our pipeline that we shared last quarter during the earnings call. But one thing that we didn't necessarily foresee the moment we went public, was just how much of a focus on efficiency we're going to have. I've been talking to you all about that for the last couple of years. And we have made a lot of improvement along those lines. So being able to grow while also driving material efficiencies to our business and you can see that with our operating expenses has been something that we've had to undertake. And all of that has happened on the backs of our customers. Like our customers are the ones who are going through probably the toughest -- some of the toughest times, whether they're a mortgage company and they're seeing record low volumes and margins. Or they're a bank and they're dealing with financial uncertainty, they're all trying to do the right thing for the consumer and serve these amazing consumers with products they need in this tough financial time. But they're the ones who were here to help. And I just came back from our annual executive Conference, which is called Blend Forum. And for those of you who don't know, Blend Forum, we get 50 to 100 executives from top financial institutions all across the country altogether and this year it was in North Carolina. And they come and they give us feedback and they share their road maps with us and they ask us our road map. And that's a really important part of it because we want to have that dialogue with our customers. But on top of that, we also unveiled our latest product innovations. And one of the things that we showed was Blend Copilot, which is a generative AI product for loan officers that sits on top of our platform. And now something that -- we're very excited about. But despite how cool that was, the thing they were by far the most excited about was -- and you can kind of see this in the third image on the screen, the thing that we're most excited about, was after the main stage keynote session we sat them down these executives of banks who are, in some cases, technical, but usually not. We sat them down in front of 50 laptops, and we said, you're going to build your own financial product on Blend Builder today. And people come up to me afterwards and say, well, it was really risky, but it worked out really well. And it was definitely the highlight of every customer who attended or every prospect who attended, seeing how simple and easy Blend Builder makes their lives in using financial products. But my highlight was actually a little different than that. My highlight was, I had 2 different customers who are on Blend Builder today come to me and say, it has changed their whole perspective on how they think about improving their organization. And they came to me and I'm paraphrasing a little bit -- and they came to me and they said something to the effective, there was something I needed to change about my business and my workflow, and I told the team at noon and by 4:00 p.m., we were already testing it in one of our lower environments. And that's just fundamentally different. Those changes, depending on the size of the organization, they take anywhere from months to quarters to make those kinds of changes. And with Blend Builder, they're able to make the changes and test it in that same day. And that, for me, is sort of the embodiment of what I think is necessary for us to achieve our vision, which is to bring simplicity and transparency to consumer finance. And it was very cool to hear that firsthand. We've been working on Blend Builder for a long time. It's taken quite a bit of investment, but seeing that come to life just showed me how much opportunity there still is gave me a lot of confidence in the future. Speaking about our vision, we -- our vision has been the same since we started the company 11 years ago. We want to bring simplicity and transparency to consumer finance and specifically originations. And the reason we want to do that is that a lot of these products that we think of as financial products as transactions sometimes, these are real financial -- really important financial freeing products that can dramatically change the course of a consumer's financial life. So for example, buying your first home, that often leads the biggest asset you'll ever build in your life for normal consumers across the country, consolidating your debt in a time when credit card rates are high and consolidating to a personal loan, can really lower your monthly payments take some burden off of you. And across the spectrum, say, using the high interest rates now to do a better job saving and opening that new CD or opening that new wealth account to do some investing. Those are things that we think are important for the financial structure of our country, but also eventually globally as well. And so that's why we set out to do what we're doing about 11 years ago and obviously, we started mortgage and we sort of expanded the purview over the last 11 years to expand to all aspects of consumer finance. But I would say the world is anything but simple and transparent today. Consumers are still underserved. The number of anecdotes that I hear of consumers who are revolving on 24%, 25% credit card debt, when they could consolidate into a personal loan or a home equity line at a much lower cost of capital and take a big burden off themselves. It's mind blowing. And the number of people who didn't take advantage of decade low or multi-decade low interest rates during the pandemic to get a house and lock in their housing payments for 30 years, because they didn't understand that they don't need 20% down, it's mind blowing. The number of people who got a 9% auto loan at their dealer and the local credit union will gladly refinance that loan at 6% or 7%. And are just paying extra money every month because they got that loan off the dealer because they just wanted the car. I mean, those kinds of things still happen today. It's because the financial system, which some people in this room can understand because we live it and breathe it every day, but to the average person in this country, it's hard to understand the number of products, the types of products, what's the right thing to do at the right time. These are really difficult things to understand. And so consumers are still very underserved today. And on top of that, even when they are served and they do get the product they want, because the products are served in a way that's still very manual and labor-intensive because they've been doing it some way for a long time, it increases the costs and those costs ultimately get passed on to the consumer, which means less accessibility for those consumers to be able to get at those products at the lowest possible cost. And it's not that the institutions that are offering these products want to do it manually, they do it manually because the systems that they want to change that they would, in theory, build these things on either aren't capable or are very, very inflexible and expensive to change because they were built 30, 40 years ago in some cases or even 60 years ago in some cases. And it's really hard to change systems that were built in the 1960s. And infrastructure is a big challenge for our customers across the board. Every bank or lender I talk to had some challenges with infrastructure. And what that all means to them in dollars and cents is that they're serving fewer customers at a higher cost than they otherwise could if they had a modern platform, and that's where a Blend comes in. It does come down to dollars and cents for our customers and actually for consumers. In the end, they're getting financial products to make their financial lives better so they can live more financially free. And -- in order to do so, they need to be able to -- we need to be able to make this process as frictionless and as simple and as digital as possible. And that's what Blends platform does for our customers. And by doing that, we not only lower the cost of origination for our customers, but by making the products more personalized. We help our customers grow market share, serve more consumers, offer them more increased lifetime value for those consumers. And we do that on a platform like Blend Builder, when we do that on a platform like Blend Builder, we allow them to continually always be on the latest and greatest from an innovation perspective. The pace of change on Blend Builder, like I told that anecdote about Forum, is dramatically faster both for our customers and for us internally as we use it as our primary development platform internally. And lastly, and this is super important. The way that really any organization, whether it's a bank or it's a consumer goods company serves consumers really well is if they can offer multiple products over the life of that customer, and having a unified platform that can serve all the products that a bank can offer is, allows our customers to be there for every moment in the consumer's financial life that they want to, whether it's their first credit card, when they're getting their first job and their first checking account to later on their car loan and later on, helping them with student loans or whatever it may be all the way through when they're retiring. Those are the kinds of things that our customers want to do for consumers, but it's really hard to do with so many disparate systems. And so that's -- I think this is where Blend comes in and being a modern platform or something that we can really help them enable do that. And that's been actually our formula for success since day 1. I mean, truly, I mean we didn't always have Blend Builder, but our formula for success was really simple, which is make our customers better at doing what they do. And as they become better doing what they do, they grow market share and they also do so more profitably. And as they do so more profitably, they often come back with the next because they're so successful and they're happy with Blend as a customer-focused company, and I'll talk about our culture in a little bit, which is about customer obsession. As they do that, they come back to us with the next thing that they want to do with us. And now you layer in something like Blend Builder that allows us to do that cost effectively and build new things and have a flexible but powerful system means we can actually serve them and help them with their next product line, which by helping them with their next product line and making them more successful there, drives even more economics to them and more benefit to consumers and the flywheel continues. And so that's been our game plan. And actually, I think, pretty much in every vertical software company, the game plan is -- or every really good one at least, the game plan is somewhat similar. It's help your customers as much as possible, be as successful as possible. And if you do that, they want to do more things with you. And so it's like that's been our formula since day 1. And our customers are sort of the centerpiece of what I think makes Blend uniquely special. Like I think about unique advantages and how do I focus on those. On a time of focus, I try to think out what are our unique advantages at Blend. And there's 3 that I can point to; our customers being the centerpiece, but our platform, Blend Builder now that we have it is another really important piece and then layer that on with a culture that really can utilize those things the best and it all comes in. So let's start with our customer base. For those of you who know us, you know we work with institutions, the largest institutions in the country, all the way down to small local community banks, credit unions and independent mortgage banks. And we've grown our customer base pretty materially since our IPO, but it's taken a decade to get here. And it's taken a decade of sweat and tears and being in their offices and throwing -- holding our annual forum and spending time understanding their processes in depth, so we can build a platform in a very regulated space. And because of that, they have gotten successful and they trust us, and they often come back to us with -- for more and more things that they want us to help them with over time. And so for our customers, if any of you are listening, I cannot thank you enough for giving us that trust over the years. And hopefully, you're seeing that we're continuing to innovate and investing at a time when I know you all are going through a pretty tough market. And one of the things that our customers are really excited about is our second unique advantage, which is Blend Builder. And the reason Blend Builder is so exciting to them is because not only is it something that is a modern platform, which, of course, has benefits in and of itself. But the way it's designed, it's designed to be more comprehensive and work across their entire process in a way that no other system has been designed. And part of the reason we've been able to do that is because of the second bullet, which is super important and that it's composable. And I want to stop and talk about this bullet for a moment. And composable for us means that as a developer on this platform, you can drag and drop almost any part of how a financial origination workflow works and do so and create new financial products in order of magnitude faster and cheaper than you could otherwise. And not only that, you can reuse those components across product lines so that every incremental thing not only creates new platform because there's more components built into the platform, but it also creates -- it's also easier and faster to build that next thing. This is sort of the linchpin also of how we've been changing our operations internally. So I don't want to overstate this, and I won't spend too much time on this because I know Eric and Amir and Seb will talk about this as well. But this is a super important part of our platform strategy and part of what's unique about Blend. And on top of that, it's omnichannel, it's not just a consumer-facing tool. It works across every persona at the bank. Any enterprise user can be made -- have a different flow working with the same product, which is super important to our customers. They don't want just 1 digital thing that they -- then separately have different internal tools, they want 1 system across all their products and across all their channels. And then lastly, it's open, which is important from an ecosystem perspective, working with partners, but maybe even more important to our biggest customers and our most tech savvy customers who want something that has all the power that I mentioned earlier, but want the flexibility to take it in their direction, whether it's connecting it to more internal systems or building completely bespoke flows alongside our team, those are the kinds of things that our customers really want, our biggest customers really want from us. And so Blend Builder -- I won't spend too much more time on this. I will say, though, speaking of forum, we introduced this at our first annual forum, I want to say, 3 years ago or 4 years ago, and it's been great seeing this come to life as a key component of our vision. It's taken a while, obviously, and a lot of investment, but it's something that we're very proud of. And when you layer on, those 2 things are customers and our platform with our culture. And if I had to describe our culture in a chapter book, there would only be 2 chapters, be super obsessed with their customers and always be driving the leading edge of innovation, just those 2 chapters. And when you power that with a great customer base and a great platform like Blend Builder, it leads to those cycles of working with customers, getting them more successful, they come back to you with the next thing and you can deliver on the next thing in a low-cost but highly valuable way to that customer. And so it creates more value creation for consumers, which means more revenue and profit to our customers, and that value creation ultimately is some part of what we'll capture some part of that back to Blend over the course of time. So I spent a lot of time talking about the long term. But obviously, we're in a pretty interesting macroeconomic environment right now. And I don't want to give you the impression that we're just focused in the long term. In fact, you're going to hear a lot from others about short and long term. But we have had to reorient the company in the near term to leverage the most of becoming this platform company and focusing entirely around becoming this platform company. So starting with expanding Blend Builder and making Blend Builder usable across all of our product lines and now starting the journey of getting our mortgage products on the Blend Builder, which it won't be just porting over, it will be a dramatically different and better experience than our already industry-leading product. And then second -- frankly, for a lot of our mortgage customers, just helping them through this tough time. It's very -- for those of you who follow the mortgage industry, it's probably once every a multi-decade time that it's been where it is today. But we're there for our customers. They've been loyal to us. We're going to be loyal to them and part of that is also delivering cost-saving products to our customers, so that they can do things even more cost efficiently than they were able to in the past. And lastly, internally, and maybe this was a newer one for us in the past few years, really focusing on using the Blend Builder to do these things as efficiently as humanly possible. Because if you have this great platform and this great customer base that wants to innovate with you and you can do it and you could in theory do it in a very efficient way, it's on us to do that. So that's been an internal initiative. You've actually kind of seen the outcomes of our cost-saving initiatives in our numbers, and you saw it in the change in this IPO over the past couple of years, but it's something that we now think about has become part of our culture and our mindset every single day in how we operate as a company. And that does lead to better financial outcomes I believe, and actually probably just being a healthier company overall. But I have to admit that our mindset, 2 years ago or 3 years ago and even 7 years ago, 9 years ago, 10 years ago, was a lot different than our mindset today. We've had to do a big shift in mindset to get to the point where we feel like we need to be able to achieve our ultimate vision of helping hundreds of millions of consumers across the world, improve their financial lives through our customer base. And I shouldn't even say we've had to make that shift in mindset, that ultimately, for those of you watching, like that ultimately comes back to me, like it's my job to set the tone and set the mindset for the company. And look, I've had a lot of learnings over the last 2 years and had to make a lot of changes to myself, first and foremost, and to the company and lead that from the top down, but it's been a lot different. What we focus on is different, what our customers, how we serve our customers is different. Our platform is different and better. And I think doing all these things, it's just like I said, it's made us healthier and there for the long term for our customers, which is something they really need from us. And I would categorize it all into the bucket of, we're going to be the best platform company that we can be, and we're going to do so in a way that serves our end vision and something that I'm very excited about. And I think one of the other things that comes from that is that it does lead to better financial outcomes for Blend. And for the first time, we actually want to share our long-term financial outlook, which is if you think about 3 to 5 years out in that range, and Amir is going to give you a much bigger buildup on this in his section coming up at the end of the day, so I won't spend too much time on this. But the short version is, we believe that because we're this platform company, we can achieve -- continue to achieve software-like margins in our platform, and also good net non-GAAP margins as well and good positive free cash flow and do it all the while we continue to grow, sign new customers, grow market share, help our customers do new things that they didn't even know was possible. And so -- and while it's hard for us to give a 6-month or 9-month outlook because so much in the short or medium term is subject to outside forces, in the long run we really control our own destiny. And I will say, controlling our own destiny is a super important part of this. And part of the -- one of the things I would say is we've set up the company to be able to achieve this in any market environment. We're not banking on some major mortgage market rebound in the short to medium term or even long term. We're just building this company to be as great as it can be with the things that are in front of us right now and using the platform to the most -- to the greatest extent we can. And speaking of platform, Eric is going to talk a lot about that in the next section. So I won't steal his thunder. Thank you all for joining. Eric, come on up.

Thanks, Nima. It's good to be with you, everyone here today. I look forward to talking to you about our product strategy, our portfolio and also giving you a peek into the future of where we're investing and innovating. If any of you need a quick break to grab a coffee or water, something, now it is good time to steal off and do that. But absent of that, I'm just going to jump into the main part of the show. As Nima mentioned, our vision is to bring simplicity and transparency to financial products. And from a product point of view, that means making them very easy to access, find, understand, order and get delivered to you. And that hasn't historically been the case for these products. Consumers are often finding it hard to understand, should I get a home equity loan or personal loan to finance something with my house, which kind of deposit account is the right thing for saving from my kids' tuition or other purpose that I have? And even once they select the product, there's a lot of paperwork typically involved that have to be shuffled back and forth with a financial institution. This is something that we think we can help with. In most other areas of our life, we can order a car to come here and pick me up and get me to the airport. I can get all the groceries to the store all at the top of the phone. And that's what it should be like for financial services. Over the last 10 years, we've been helping our customers, the financial institutions deliver a modern digital seamless experience to their consumers, to their customers. And today, I'll walk you through how we've done that and also how we want to carry that forward. Everything we do really starts with the consumer. We serve other constituents like bankers and people who work inside the bank closures, loan offices, et cetera. But the core always starts with how do we create a great consumer experience. And we want that consumer experience to be proactively delivered -- that the consumer, if they're a customer or financial institution shouldn't have to always go and look thing on and figure it out, proactively delivered to them, personalize to their experience. We're used to that in all other areas of our life. We expect it here as well. And it should be simple tap, I get approved, I get it qualified, I get it delivered to me. To deliver on this core, we built a set of out-of-the-box experience that financial institutions can adopt as is from us. Around things like home equity, credit cards, et cetera. And all of it is built on a new modern platform layer. You heard Nima talk about Blend Builder. It's an initiative we started about 4 years ago, taking all the learnings we had from mortgage, from the initial consumer banking products and transforming it into the most modern cloud banking platform available. So today, I'd like to focus on 3 specific areas in terms of our product strategy. First, we'll talk about some of the key industry trends that drive our decisions on what products to build, and with what set of capabilities. Secondly, I'll walk you through the actual product portfolio to give you a more concrete sense of what products we have available and why our customers buy them. And thirdly, we'll talk about new investment horizons, what are new things we're investing in and where do we see future revenue come from beyond the core set of products that we have today. I should say that after this session, a couple of my colleagues will come up and do a couple of demonstrations. We'll walk you through the Blend Builder demo. My colleague, Mike White will do that. And then you heard briefly about the AI product; Nima and another one of our colleagues will come up and give you a live demo of that product. So talking about the key industry trends that drive what we do. I would say the most important overarching trend that drives anything Blend does, is the move to fully digital self-serve, automated, instantly deliver financial products. That is the umbrella trend. We've been investing around for 10 years. There's 10 more years of investing around that easily. But within that, there are specific sub trends and needs that we're solving for. One of this is the move away from just having a point product to having an end-to-end solution. So a good example of that is the mortgage area. If someone is looking for a mortgage, they're not really fundamentally looking for a mortgage. I don't know anybody who thinks that's a fun thing to do. But what they are looking for is getting into a home, maybe they're scaling their family or finding new space. And so the goal for that consumer is getting into a home. As a financial institution, how can I help them with that? I'm not just a provider of money. I want to provide something that helps the consumer reach their full goal. That means end-to-end services. Can I help them find a realtor? Can I help them go through the title process? Can I help them go through the closing process in an easier way? And that's both the way to help the consumer. But for the financial institutions, it also a way to up-sell and create new products and services that is not just a loan. The second key trend we see is a move from relatively generic products to the ones that are more personalized. And of course, in other areas of the life, this is a very common thing to see. So if you use Netflix or TikTok or whatever modern product, you get a curated personalized suggestion on what you should do and what might be of interest to you. This has been slower to come to financial services because of how regulated it is and frankly, in some cases, because the technology stacks have been aging and not able to adapt to it. And lastly, I briefly mentioned the move from reactive to proactive. Today, it's very much of the consumer to go and find everything about the products, research them, compare them, understand them. this should be delivered. If I have -- if I'm a financial institution, I have a relationship with a customer, I should create curated product offerings and experiences for them all the time. Similar to how the consumer trends have been evolving. There's obviously a lot going on in the technology landscape as well. And while we don't want to address all technology trends, there are some that are particularly applicable to how consumer finance products are delivered. Starting with this move from documents to data. anytime you apply for a loan or open a new account or interact with your financial institution, it always involves documents, either literal paper documents or more likely tons of PDFs getting shuffled around. That means people have to look at these PDFs, read these PDFs, route them to other people. If you can use validated data sources instead, you can process things much faster and you can deliver better experience to consumers. And these days, more of these data sources are readily available from banks, from payroll of IRS from the IRS, from credit bureaus. And I'll share with you some examples later for our mortgage product. Nima talked about the transition from to code to composable. Of course, any software product is fundamentally built on code. But if you have to change that code every time you have to adopt our unique customer need or want a personalized experience, then it slows you down tremendously and it becomes cost prohibitive. What we see is a need to move a lot of the business logic, a lot of the workflow, a lot of the adaptations into a separate layer that's composable. I would say the #1 thing banks are struggling with is adapting to change. It's probably true for pretty much any company out there, but whether it's new regulations or fintech competitors on modern consumer needs, change, change, change is the only constant, and the composability is what allows them to adjust to that. And then the final area is around the move from individual products to a platform approach. Banks like, again, other organizations can be a little bit guilty of sort of shipping their org chart that however you organized internally is what you reflect outwards to your customers. And so they build up business units to have individual technology stacks, individual customer experiences, but it's not starting with a consumer-centric point of view of unifying that across everything the consumer touches. That requires a platform approach, that requires platform thinking. So these are all great things for our customers to go and embrace. But it's hard to go and embrace it because they don't always -- they're not always in a position to do that. I don't want to enumerate everything that stands in their way, but a couple of highlights that keep coming up, include some of the ones here. Number one, the lack of integrated data. If I want to personalize anything for any of you, I have to understand who you are, which means I have to look at different data points about you and integrate it into a single view. 80% of bank executives we thought they cannot do that. They don't have that view. If I can -- if I don't have that, I can't cross-sell, I can't personalize the expenses. Secondly, that the origination experiences are one-size-fits-all. So even if I had data and I knew what I wanted to do, can I actually customize it on the fly to give you an experience than the other consumer. Today's products tend to not allow for that. They need to be flexible to allow for that. And then thirdly, as I mentioned, they've been a little bit in the mode of sort of operating inside individual business units that each have their own technology stack processes, user experiences. They are struggling with dealing with sort of papering over that fragmentation and create the unified view. We looked at all these things in aggregate and independent of any individual product what we do, we said we have to have an approach that unifies all of it. we've chosen to call that composable origination because we think it unifies the combination of having out of the box, fully ready to roll, origination experiences that financial institutions can adopt along with the composability that it can adapt to any of these needs. It's powered by some of the things I talked about, verified data sources, the ability to build end-to-end workflows and unify things on a single platform. This is how banks can be responsive to modern consumer needs. This is how they can compete with fintechs that have a laser focus with the modern technology on going after many of the financial institutions. If they take an approach using composable origination, there's some fundamental benefits that they get from it. Probably most importantly, they get to innovate. As I mentioned, they are facing competitors that are nimble and tech savvy. They need tech arsenals and capabilities that allow them to move as fast, bring new products to market when they need to. They also want to create differentiated experiences. Customers tell us it's great that we have our out-of-the-box products that they can adopt as is, but they also want to show what's unique about them. What is unique about their brand. What is unique about the way they provide their service and create these products, allow them to express that in the product. And then lastly, of course, they want to lower cost that's both the cost to originate, which means more automation, more data sources, it is also lowering the cost of the tech stack, not replicating the same components over and over in different parts of the financial institution. So everything we do with our product portfolio embraces this notion of composable origination. And so with that, I want to talk you through some of the main capabilities of suites that are part of our product. We have 3 main product suites at Blend. The Mortgage suite, the Consumer banking suite and our composable origination platform known as Blend Builder. The Mortgage suite, as many of you I'm sure know, is our original product line where we learned a lot of things and developed and grew with our customers. So in many ways, it is the most developed and deepest of all the products that we have. Earlier, I talked about end-to-end journeys in the mortgage area and that it wasn't just about originating a mortgage, but really helping a user with a number of other things. How do they find a lender in the first place? Can they get preapproved, how much are they preapproved for? Whatever they're preapproved for, dictates what they can actually go shopping for in what neighborhood and so forth? How do we help them find the right home? Do the home search and going through things like title clearance, getting homeowners insurance, which obviously is a requirement when you get a mortgage and it finally is closing and through to moving in. All of this is -- they are things that we have helped our financial services' customers serve their consumers with to create a richer experience. If I look at this more from a product point of view, there's many more things that are listed here that go into the full mortgage process. I want to give you a little bit of a highlight reel of some of the things and what a user experience in a modern mobile phone-enabled way to get into a home and do all the activities that are associated with that. Many of you may be most familiar with Blend in a very sort of simple and a little bit superficial way as an application, you see you enter some data in a field, and that's kind of the experience you have. But it's sort of like an iceberg, like 99% of the real power and the real value is actually underneath the hood as long to highlight a couple of things that I think show that. We talked about the movement from documents to data. In the verification area when someone comes in and they apply for a mortgage, rather than have them go on fish for their pay stops and get an employment verification letter and seeing if they can find those tax receipts from last year, all this kind of stuff, we automatically go in and try to do an automated pool of all of that. Can I pull the income from the payroll provider? Can I get the asset statements from the bank? and so on and so forth. What happens when I do that is the consumer doesn't have all this frustration of trying to find this paperwork that they may not be able to find. In fact, we see a lot of times they churn out, they get frustrated in the process. And from the bank's point of view, it means we now have data coming in -- if I have data, I can apply automation. I can decide on things immediately. I can push a workflow immediately. So verifications are a key part of powering and modern origination experience. The other one I want to turn your attention to is the one at the end, called Close. So I don't know I assume many of you at some point have tried to purchase a home, hopefully went through with the process. And if you have, then you know that at some point, you either had to show up at a title office or had a notary shop in your home, they bought a big stack of papers, and you had to sign all of it immediately. You most likely or very unlikely, I would say, had time to actually read all the documents. When we survey consumers, they say that is usually the most stressful part of a home purchase. Like you're signing all these documents, it's probably the most important financial decisions you've ever made, and you really don't have any sense what you're signing off on. It's not a good experience. It's right for being modernized. And that's one thing we worked on. How do we do that? Well, first of all, we digitize as many of the documents as we can and push them to the consumer in advance. Let them sign in, in advance, let them consult their loan office. So [indiscernible] some of the Internet, whatever they need to do with peace of mind and time to complete the process. There are certain parts of the process that you have to do in front of a notary. We've moved that into what we call a digital signing room. So imagine a sort of a Zoom call where you joined by a notary loan officer yourself, anybody else that is needed. You can sign everything electronically, you can do it in your home. From a lender's point of view, it means I don't have to ship people physically around and pay for them. I can do it all with a phone call from wherever they work. It's a much more efficient process for everybody. And it's a good way also, frankly, for a financial institution to monetize additional services. If we step back from the fact that, okay, it creates a great consumer experience and there are some efficiencies with like, what does this boil down to in dollars and cents? Like how do banks actually bring more money using Blend. There's a few main categories that tend to repeat across all our products. The first is that the pull-through increases, more people complete the application, they're less frustrated. They don't have to stop because they don't have the data, so with greater pull-through is more success. On average, for our mortgage customers, we see a 15% increase in pull-through of applications. Second thing is around speed to close. It takes a lot of labor and work to finish alone, that ties up people, resources. It delays payment to the consumer, delays payment to the bank. The more you can close, the more you can save those resources and get the money flowing faster. And last is, of course, lower cost. When you use automated data sources when you have standardized loan applications, when you drive things through automation, you lower the cost. And all of this shows up in the net impact. The impact alone of using a Blend Solution versus not, is $636 for a mortgage loan that is a big proportion of the cost that goes into originating a loan. And that's why lenders on average have something close to an 8x return on investment by using Blend for their mortgage processes. Turning now to the second big product suite that we have. Consumer Banking suite. On the mortgage side, it's a relative verified event, at least for most of us. I don't buy a house that often, but so if you do, it's maybe a few times a year. But when you do, it's a complicated process with a lot of steps. Most of our normal banking needs are more every day, maybe a little mundane but nonetheless important, saving up for kids' tuition or getting my paycheck deposited and managed and getting access to credit for different types of purposes. That's what the consumer banking suite is about. It aims to address every standard, most common consumer finance need that every consumer has, that every consumer bank will want to serve out to their consumers, different types of deposits, savings, checking account, more or less interest rate depending on time horizon, being able to have access to short-term credit through personal loans and credit card, lines of financing some big purchase. Maybe it's a car, new RV, maybe it's a renovation of my house, specialized loans around that. We provide the full battery of products around that. and not just these individual products, but the fact that they're integrated together. They all have the same user experience. If you've used one, you know how to use another. They use the same automation modules across. They have cross-sell capabilities. So if I have used 1 product, the bank can pre-populate all that data into another application and suggest to me, why don't you get this deposit account associated with your mortgage to make it easier for you to make your monthly payments, which gets to another key point around the economics here. We see some of the same benefits, higher conversions, speed to close, lower cost, they all apply to each of these products just like it did for mortgage. In this particular case, rather than illustrated through averages, like we did on the mortgage side, I just thought I'd pull up an individual customer as Elements financial, they're based out of Indiana, a great long-time customer I had lent. They use a pretty full suite of all our products, credit card, vehicle loans, deposit accounts, a few more than I think. And you can see for individual products, they have had 11% increase in approved applications. They had a 60% reduction in application submission time. So a lot of great economics around that. But because they use multiple products, they get an additional set of benefits. Single-user experience across reduce costs through automation and all of this aggregates up to what I think -- what I hear most commonly a from consumer finance institution is their #1 North Star metric. How do I drive customer lifetime value? Each of these companies, they want to deepen the relationship with an individual customer. If you already have a mortgage with us, I want to make sure you have a deposit account. Can I set up a student savings account? Can I help give you a credit card? That is the best way to drive deep relationships is the best way for the bank to drive up revenue is customer lifetime value and our product suite is specifically optimized around that through things like cross-sell and other capabilities. The last part of our tour of the portfolio is the Platform layer. And this is probably where I would say, we're the most proud of the level of innovation that we've been able to bring to bear, over the last several years, a lot of the individual capabilities you see in mortgage that you see in consumer banking, are powered by the Platform and can be applied to many other areas as well. When we developed the Platform layer, we wanted to build something that powered end-to-end journeys for any banking product. That's not how we started Mortgage or Consumer Banking. But with the Platform, we said it should be able to power both those 2 product suites and any other product suite around any origination experience for any financial product that we want to build in the future. Even if partners want to build it for or with us, even if the customers want to build this platform, should be able to do it. And it doesn't do all of that in one go today, but that is the journey we are on. Today, we have all of our consumer banking products on it when the process of moving mortgage over, and we will gradually start opening up access to the platform. So people outside of Blend can build directly on it. Within the platform, we solved for 3 main goals when we built it. We want the customers to be able to define the experience, not just Blend. So that they can put the unique value into these experiences. We want to support continuous and rapid innovation by customers not just apply standard experience, let's say, how do they want to change, how do they want to differentiate and how do they put that into the product on an ongoing basis. And lastly, related to this part, every modern technology company is constantly experimenting and optimizing. That is the best way to innovate. But historically for financial products, in part because of technology, in part because of regulation, it's part for them to do that. So again, the platform is built from the ground up to support ongoing experimentation and optimization. So this kind of a classic stack view of the platform. There are a lot of pieces going into -- even this is, of course, not a full view, but I wanted to at least give you 1 pretty comprehensive view of all the personas on the left, the solutions being powered on top and the components that go into it. To give you a sense of why we think this platform is very unique in the industry. I want to highlight just a few different things. Starting at the top layer of the diagram. We have Blend Solutions that are fully developed on this platform that are ready to be deployed. If you're a financial service institution that want to provide a digital experience for, let's say, credit card, you could just take that product, deploy it and you're up and running. You don't really have to do a lot of customization configuration. Now the reality is most customers will want to do some configuration customization because they want to sell their value and make it their product. And the larger the customers are, the more I would say there is supply. So largest financial institution, this is an absolutely key requirement for them, take both the out of the box product from Blend, but also apply their own identity and value to it. You can also see the bespoke solutions over on the right. This means we can actually deploy pretty much any new solution on top of the platform. And in fact, we worked with several of our customers to develop new products that they wanted to create that we did not have out of the box. And I'll walk you through one of those in a little bit. Underneath this Solution layer, there is the sort of the main thing that makes it composable. It's a visual drag-and-drop environment, you connect pieces of functionality to each other. You decide the rules that should express between them, you surface that up into a UI layer or to an API. And it's much faster, much more iterative than sort of classic code development. In the demo that Mark is going to give in a little bit, you will get a very concrete sense of what that looks like. And the middle part of the platform is sort of the main part of it to some extent because these are the prebuilt, what we call Blend blocks or builder blocks out of the box, pieces of functionality needed to create an origination experience. And these take a lot of time to build out, to harden, in a lot of cases, they connect to external services. In a lot of cases, a lot of decision logic within them. So if you pull credit, you can either pull from all 3 providers or 2 of them in a particular order, similar for a lot of other things like income verification. This library of LEGO blocks is sort of the basics of the composability and the things that makes it much faster to develop on the Blend platform when you combine it with a low-code development environment. So we covered a lot of things around the Platform. There's certainly a lot more we can go into. I hope we have a chance to talk with some of you individually about it afterwards, so you'll see more on the demo. But just to abstract it out a little bit, again, like why is this platform so unique? Why do I think you cannot find anything else in the industry like that? Well, first of all, it's comprehensive and optimized for consumer finance in a modern cloud experience. It has all of these out-of-the-box solutions and all of the building blocks that go with it. It's composable. We saw the way it can be authored and assembled in a new and modern way. And it is omnichannel. It is while it starts with the consumer experience and solves for the consumer experience, it is really about unifying how consumers and bankers and other constituents come together to deliver a full product experience. And then finally, it is open. It fits with the existing environment. Pretty much any financial institution I know have spent oftentimes decades investing in technology. The last thing they want to do to introduce a new digital layer is to have to rip and replace out something else. So the way we integrate with existing banking cores, loan origination systems, et cetera, is key. All right. So we're getting to the last chapter of the book. We cover trends in the portfolio. I want to do a little bit more of a forward-looking take ride now and talk about where we're investing beyond these key areas that I've shown you so far. So we come from Mortgage, develop the broader home ownership journey and led into Consumer Banking. And if you look at our investments in the coming years, a lot of it will still be in these areas. There's a lot of opportunity to continue to innovate, provide more value, provide more depth in those areas. But there are other new investment horizon and things we'll invest in. And I would say that through line through pretty much all of them is the Platform, the Platform is both the linchpin and sort of the leverage point that drive our investment in these areas. The 3 areas are, deepening existing solutions by which I mean not the ones that are listed here, but add-on products that can attach to these experiences; secondly, developing an entire new suite of origination products. So just like we have Mortgage and Consumer Banking, there's an opportunity to develop other suites addressing all the origination needs. And then thirdly, there's an opportunity to take these products into new markets where we're not present today. So if we go through each of these in a little more detail. And I want to give you a more concrete sense of how we can do it and also how this can lead to revenue for Blend. In terms of deepening existing solutions, we have already done this quite a bit in the last 2 years and every time we do it, we focus on one of the trends I talked about earlier and say how do we develop a relevant modern product experience around it. So around digitizing an existing manual experience, we developed the Blend Close product, I shared it briefly with you earlier. We actually had that plan and just started when the pandemic hit. And then pandemic hit obviously, demand exploded all of a sudden. We accelerated our development, it has been one of our fastest growing products over the last couple of years, a lot of adoption already, but we continue to see a lot of a growth ahead for it. We did the same with the documents to data trend. We did the same with the documents to data trend. We saw that customers were dealing with manual pay stops and employment verification letters all the time. Why do we build a blend income product that pulls from many different employment sources and aggregates it up. And so from a financial institution, they can just kind of do an income hit and it will fan out, it will pull the data if it's available, simplify the process. And we did it with end-to-end journeys, so that when someone applies for a mortgage, we automatically generate a home insurance, serve it off for them. If we can, we compare it to the existing price if they already have insurance, and then we help them issue that insurance. So through these and several initiatives, we have had more than a 4x increase in revenue contribution from attached products over a 2-year period from 2021 to 2023. And -- this is a good way for us to serve very specific needs and take advantage of the technologies and skills we have to sell into our installed base. One area that's an example of how we can continue to do that is the AI co-pilot. It is a system that drives through AI and is able to answer complicated questions from consumers in a very personalized way that takes advantage of all our blend services to serve an answer up to the consumer and have a loan officer curate and manage that. And we'll show you a demo of that in just a little bit live. The second area of expansion is around adding entirely new suites of origination products in addition to what we have for Mortgage and Consumer Banking. Some examples of this are small business is an area that we're not currently in today. commercial banking, wealth management, there are yet more both in financial services and even with -- outside of that, that we can push into using this platform. And just to make it a little bit more concrete, if you look at Small Business Banking specifically, there's 33 million small businesses in the U.S. today. Every year they open 1.5 million deposit accounts, they open 2.2 million business credit cards. And most of it today is not automated, is not digitized, is not available self-service. It's a complicated process. It's often expensive for the banks to serve because they have to do everything manually. So there's an opportunity to digitize and modernize this process. One of our customers, BOK Financial, they came to us and said, "Hey, we want to provide a digital experience for that, but we don't have a product for it." So we worked with them on top of Blend Builder, build out a new modern experience for them, took 4 months to develop and deploy. We're very happy with the outcome. I know they are too. And we've had a number of other customers come to us and say, "Hey, can you help us with business deposit accounts. Can you help us with business line of credit? Can you help us with a small business loans?" And yes, we can. And over time, we will, we will go from individual bespoke products here to full commercial suites of products, and we will do that in other areas. And most of the time, our customers will lead us to the demand. The last thing to talk about is expansion into new markets. Today, we are present in the United States only. It's a combination of having enough opportunity there historically and also that the original products were not set up for international expansion. When we started the rebuild of the platform 4 years ago, that was one of the things we knew we wanted to do solve for. We knew we eventually wanted to go international, so we've started to internationalize the product as we went, being able to extract strings, localize, deal with different date formats, all the kind of stuff you have to do for international products. We've even now started shipping a small piece of our mortgage product in Spanish in the U.S. for Spanish-speaking customers. And the next step will be some future investments to support multi-language, et cetera, that we are set up for but haven't yet done, but will do in the coming years. Through that, we see an opportunity to go after some main markets. Initially we see Canada and Europe as the main opportunities. If you look at those markets and you only look at the customers that have more than $10 billion in assets under management, meaning just the larger customers. We have many more customer opportunities there, then just that alone is more than 500 prospective customers. My comparison, Blend today in the U.S., just over 300 customers. So it's a significant expansion of the available pool of customers, even counting just the largest prospects. To attack this market is a combination of our platform, of course, us establishing in-market presence and also, we see this as an opportunity to go to market with partners. Global system integrators and other partners have the local expertise in this market and when trained with Builder, they can go in and help us open up those markets. So I just want to quickly summarize what I see as the main points, I hope you take away from my presentation today. One is we have built out a comprehensive, I think, unrivaled portfolio of consumer banking and mortgage products that are all built on a single platform, all available in an indurated format. Secondly, we built a modern new cloud banking platform that is composable, will allow banks to innovate and go to market faster. And thirdly, due to this platform and some of our other initiatives, we are well set up for expanding into new growth areas beyond the ones that we're in today. So with that, I would love to show you the products a little bit more. At least for me, if I see a product, I understand it better, where many of us are visual thinkers. So we've got to show Blend Builder product demo that my colleague, Mark White will walk through. it'll take about 15 minutes altogether. And then Nima will come afterwards and give us a live demo of the AI co-pilot.

Thank you for joining us on Blend's first ever Investor Day. My name is Mark White, a solutions engineer with Blend. And today, we're going to take a look at a few of the ways the Blend Builder platform is changing the shape of financial product origination. Many financial institutions are challenged with siloed technology stacks between their digital, branch and operations teams. This creates unnecessary friction in the customer experience, missed revenue opportunities, and makes it challenging to deepen relationships with existing customers in a highly competitive market. Financial institutions have a difficult time quickly adjusting to market changes and capitalizing on new product opportunities because changes to the existing experience are costly, difficult and slow to roll out. The Blend Builder platform is a low-code solution designed to power financial institutions to take control of their origination experiences and brings together all of the complex requirements around integration, workflow management, compliance, business rules, logic and automation to create an environment where a business analyst level individual can truly own, configure, manage, update and change all of the various onboarding workflows for a given financial institution. This means the business line is empowered to make changes more rapidly and in a more self-served way, and IT organizations have the tools to deliver more value to their customers faster than ever before. Let's take a look at how the Builder can enable the financial institution to go from a blank canvas to a complete end-to-end financial product, ready to roll out to their customers in a matter of minutes. What we're looking at right now is the Blend Builder Interface. This is specifically designed to make the process of designing, constructing and configuring origination workflows as easy as possible. And one of the unique tools that Blend brings to market is something that we call our Blend Blocks. These are preconfigured sets of configuration, that could comprise things like [indiscernible] the actual UI/UX that you're seeing here, the fields and data components that are necessary to power this origination workflow and integrations to internal services, data transformations or external third parties that can provide significant automation and analytics to create more of a personalized experience than ever before. What you're seeing right now is an example of how an FI just grab one of Blend's initial getting-started blocks to kick off the universal application, this concept of allowing a customer to come to the financial institution and express a need and have the technology find the right solution for them. But this customer wanted to make some changes to Blend's Block. And so they've gone into one of the initial form nodes and are adding one of their own customized fields through the simple drag-and-drop user interface. They can add it into the existing data model, define things like unique contextual help for that particular field. And just by using this drag-and-drop interface in this way, this new field becomes an intrinsic part of this particular on-boarding workflow and is completely indistinguishable from the configuration that they also leverage from Blend. This gives our customers the best of both worlds, where they can continue to leverage out-of-the-box capabilities as delivered by Blend Blocks and through our preconfigured integrations to external services like credit homeowners insurance data collection, document signing services, et cetera, and express their own personalization throughout the experience by incorporating their own language, their own look and feel and their own unique data elements. Now let's take a couple more blocks. We're going to add the ability to capture the typical personal details and employment and income information that you might need in the financial services product. The ability to hit a credit engine or credit bureau, right, to get an individual's credit score. And finally, the ability to render or show that credit decision to the applicant. Simply by grabbing these 4 blocks, we've now constructed a complete end-to-end workflow that we are actually going to publish live for you all today. Before we do that, let's actually take a look at the configuration representation of this workflow. Everything that we just connected is defined as a part of this JSON stream. All of your configuration elements, all of your automation logic, the way your integrations interact with each other, all codified for you by using the drag-and-drop tools that we see before us. Now let's take a look at our published experience. This is what the applicant would actually see where they had come to [ Emblem Bank ] and try to apply in this universal way. Right? They might opt to sign in through their online banking technology and the integrations we have with those tools, we'll certainly prefill a variety of their initial information. But what you're seeing here is an example of that updated block, that this particular individual change is a part of this financial process as a part of this particular workflow. They've taken that initial intent details and added their promo code field to build logic behind it. But it doesn't just stop there in terms of personalization. We've also given them the ability through the native integration capabilities of the Blend platform to integrate the things like their existing servicing systems, their existing customer record systems, to provide this individual a highly personalized and highly unique experience that recognize there were mortgages on us and prefilled all of their existing data to provide them unique value and understanding that just beyond this individual product scenario, there are other things that FI might be able to do for you. The Builder also plugged directly into NFI's existing product and pricing engines and credit decisioning engines or gives those customers the ability to leverage the native pricing and decisioning tools that are part of the Blend platform in Blends Decision Management Studio. This does things like deliver personalized rates to a customer and help them determine across a wide swath of products or potential products, exactly which one might be the right fit for them. Another really important component to the customer experience is not only how do you provide a full suite of self-service tools and automation that streamlines the customers' application experience, but how do you treat them from a post application perspective? Document collection is still a very, very important part of the financial origination process and leveraging the power of the Blend Builder, you have the ability to create through the drag-and-drop tools simple business rules that can automate all of your document collection requirements to present exactly the specific documents that are necessary to that customer at the right point in time. Now one of the more interesting things that our customers are starting to look at doing by the power of the Blend Builder is creating an experience for customers that helps them understand the full texture of value that, that financial institution can offer them. Right? So today, this customer came in looking for an individual loan, because they were trying to go through a home improvement project. The FI in pulling their credit to make a decision about that particular lending product, also noticed through the power of the Blend Platform, that they have an auto loan that is not with this FI with [ Emblem ] Bank. So the Blend Platform was able to calculate on the fly, the details of their original auto loan, compare that to what they could potentially be approved for with [ Emblem ] Bank and then present to that customer dynamically this detail you see on the screen before us. We can save this customer up to $300 a month if they were to refi their auto loan with [ Emblem ] Bank. This type of unique personalized value is typically reserved for months long campaigns that require intensive farming of customer data, product and pricing data and a lot of manual work to set up all of the offers for each of the individuals who are going to be given something like this. And then typically, it's delivered via e-mail, it's sent to customers in the mail. This experience was entirely constructed in an automated fashion delivered to the customer automatically and allows them to engage with it in a completely self-served way. This is one of the major ways that the Blend Builder platform is changing the shape of how customers interact with their financial institutions, originate new products and ultimately understand the value that financial institution offers them over their entire customer life cycle. Now let's look at an example of how we might make a change to this particular workflow. One of the other really important concepts behind the blend builder platform is Blend continually invest in expanding our integrations, our third-party services and the scope of capabilities that the platform has empowering these onboarding experiences. So let's go back into the workflow we just -- we were just looking at. Now let's make a quick change. We're going to go back to our Blend blocks where there's a prebuilt integration to a driver's license scanning service. I'm going to grab that block and drop it out in the canvas. And we're going to just go right back and immediately republish that experience. Now one of the important components from a technology perspective is every time we've made a change and we've published a new version of this experience, the Builder is keeping track of that entire version history. This is really, really important to our customers. Because their regulators will often come and perform audits that require them to look 1, 3, 5 years back in your history. And they're often asking questions not only about the loans that they've got, the accounts that they've opened, but how that process was executed, what workflow took place, what business rules and automation did you have configured to run. And the Blend Builder Platform makes it extremely easy for that financial institution to support that process through something like this version history. Let's go back into this published experience now and see what we just added, right? The beginning of this is going to look very, very simple. We're going to express all of the same type of intent details that we did at the very start. But now rather than having our information prefilled with [indiscernible], we're presented with our driver's license scan. And this gives us the ability to take a document and whether we do it on our phone or on our desktop, scan that document directly into this particular workflow, where it can be recognized and the data extracted and populated into this particular experience for me. Now this was a drastic change to the U.S. And all it took was leveraging a Blend Block, bringing that block into our workflow, connecting it at the appropriate point where we wanted. And all of the logic behind, when the service should be run, the data elements and the data model that are necessary to power this third-party integration, the actual communication of that integration, what data is being sent, what data is being received, how do we react to it. And the [ UX ] of that entire scanning experience are all encapsulated with this single block. So the one activity of dragging that block out of the screen, hooking it up and publishing my experience, give me all of that rich functionality and all of that rich capability without needing to touch a single line of code. This is just another way that the power of the Blend Builder Platform is changing the shape of financial originations. But we're not going to stop there. What we've taken a look at so far is leveraging the power of Blend Blocks to create a consumer experience for the digital channel. Now I'm taking everything that we have just created, copying it and dropping it on what we refer to as the enterprise side of the Blend Builder. This is where workflows are constructed for the staff at the financial institution. So if I were to walk into a physical location and walk into a branch and [indiscernible] bank, this is the experience that, that branch bank is going to be able to take me through, if I'm interested in opening up or taking out a loan. Now I just constructed an entire experience simply by copying the existing consumer one, pacing it and publishing that new experience. I want to pause for a second because that looks incredibly simple. But what we've actually done is just construct a complete omnichannel experience that ensures if the customer comes to [ Emblem ] Bank's website to apply for a financial product, if they walk into a branch, to talk to a person. And I want to understand a little bit more about what financial products might be available to them, that same experience powered with the same automation, the same tools and the same capabilities is now fully deployed across the digital channel, the branch channel, the call center. Every customer touch point is now consistent to deliver the same world-class experience regardless of when, where or how that customer chooses to interact with [ Emblem ] Bank. And we did it in a copy and a paste, right? It sounds very, very simple, but there is an immense amount of power that having a single platform like the Blend Builder can provide rather than needing to manage the multitude of technologies that most [ FIs ] have to deal with today where their technology between their digital channel is separate from their technology that's used in branch, separate than what their call centers are using and IT teams have to commit their entire road maps, simply to managing integration between all of these disparate technologies. The Blend Builder Platform made delivering true omnichannel experiences to the entire customer journey as simple as drag and drop. This is, again, one of the key ways that the Blend Builder Platform is helping change the shape of how financial products are originated in the market today. I want to thank you very, very much for your time and attention. We're going to turn now to the Head of Blend, Nima Ghamsari, who's going to talk to us a little bit about the continual innovation that we're doing at Blend, with some emerging AI technologies and large language modeling in a unique application to how that fits within the mortgage process.

Thanks, Mark. And so it's so great to see that come to life because that did come from something that our customers were asking for. Obviously, they weren't asking us for specifically that. But the things they're asking us for -- where the ability to embed more power in system, be more end to end and they were also asking us, a way that they could have more flexibility. And when everything was in code, it's really hard to do that and that's what inspired us to create this. And I mentioned we announced this at our first forum and it's just been a hit since then, and our customers love it. And so it was great to see that firsthand. But -- for us, one of the things that's always interesting to look at is when there's new emerging technologies. Like what's recently happened in Generative AI is to think about what how, if at all, could this be used in our space. And not everything can be and I have this strong belief that we should use our unique advantages if we are going to implement these technologies and we should also make sure it's a high utility thing, not a flash in the pan thing. And so when Generative AI came about, it was -- obviously, it was very -- the recent advancements in Generative AI came about, it was very hyped. And for us, we kind of took our time and looked at where can we apply this the best. And something Eric mentioned during his presentation is one thing that financial institutions really want to do, our customers really want to do that Blend Builder is very capable of doing and Blend's Platforms generally are capable of doing and help them with is, be a system that really understands the consumer and their financial situation and also be a system that understands all the bank's products. And every consumer is different and across the spectrum, there are tens of thousands of products that banks offer. And so the combination of those 2 things is really hard to do. And that is sort of the thing that came to us as, this could be a really practical use case of Generative AI. And the other thing that's really interesting is most of the interactions during, for example, a mortgage process are still done by consumers in natural language. Whether it's to their loan officer, to their bank or whoever it is, financial adviser. And so it was kind of a perfect entry point to look at it and so we announced Blend copilot a couple of weeks ago, about a week ago. And I want to show you a live demo. So, just to set the stage, I'm a [ Blown ] officer, I am a of Blend. And I have the Blend LO Mobile app user of a mobile app on the screen here today. And Blend LO Mobile, for those of you who don't know, it's kind of the Mortgage suite in your pocket, if you're a loan officer, you're on the go, you're either showing -- you're presenting it at Investor Day, whatever it may be, like it's just there in your pocket and can help you. And so in this case, we have a consumer named Alice, who will be played by one of the engineers who worked on this product, Dario, who's sitting over there. and Alice has just applied for a loan. And so as she's applied for a loan, maybe she's just gotten basic information done. She's going to go do some showing, she's buying a house and she is probably going to come to me later for help around things like, okay, I'm going to this showing, I need an offer those kinds of things. And you probably did notice at the top right of the screen, I just got a little chat bubble saying Alice just sent me a message. So I'm going to tap on that. And you can see that Alice just sent me a question, Alice played by Dario [ question ], and can you send me a preapproval letter? I have a showing today and I want to offer $350,000. And this is where Generative AI can be really special because Alice's financial situation is specific and unique. And the products that I offer as a bank or lender or loan officer are unique and different. And so it's going through and it's going through every aspect of Alice's financial profile, combining that with the product that I offer and saying, okay, in this case, I had said $280,000 for a 30-year fixed, updated all the fees. And now it's not only done that, it's generated the preapproval letter for Alice and generated a note for me as the loan officer to send back to Alice with a link to that preapproval letter. So I could have been talking to you, I could have been getting coffee by the time I show up and open my phone, the AI has done the work for me. The copilot has done the work for me so I can serve Alice as fast as possible and send that note to her. And so Alice is going to go. And by the way, one of the important things to our customers is they're very regulated, having a full audit trail around this. Every aspect of the process has to be done. But maybe now Alice went to her showing and maybe it was successful and maybe it was not and she's going to send me a message at some point saying, how it went and maybe next steps if I didn't ping her proactively already. And actually, it -- I just got a message from her saying, my offer is accepted. I want to figure out how much I need to spend upfront. Times are actually -- right now, one thing consumers are thinking about a lot is how to conserve cash, so this question makes sense. What would my monthly payments be? And what would they be if I only put down $35,000? One thing I'll mention is that this is connected to all of the major Blends, including things like our credit pool service, our Blend Income Service, which Eric showed you. It's connected to our product and pricing engines, which connect to all the products of the bank. And so then copilot sort of serves as this orchestrator across all these services by interpreting what natural language questions are coming from Alice and figuring out which products and services it needs to -- or use from the Blend Platform to get Alice the answer that she needs in that moment. And so in this case, Alice is going to get 2 scenarios. They're doing 2 scenarios, one with $70,000 down on a $350,000 loan or home and one with $35,000 down, and it's going to create those 2 scenarios for me to share with Alice, without me even having to lift a finger. And actually, it writes up a nice response for me to say that your payment would be $2,217 at $70,000 down $2,565 or $35,000 down and also shares the closing costs with Alice and I can send that to her. And maybe I want to edit that because we always want the loan officer to be in control, to be able to see what's going on, to be in control so that they can personalize the message. Maybe I would edit this here and say, hey, these are complicated financial decisions, hop on a call with me if you have any questions. But the important thing is that these 6, 7, 8, 10 different systems that I normally would go to as a loan officer to do this work and get that preapproval letter and then compare multiple scenarios can now be all done in 1 place by the copilot. So now let's fast forward a year. So I suppose that I'm still Alice, and now it's been a year. Dario is still Alice. It's been a year, and Alice got her mortgage at 7.75%, and she sees rates coming down. So she might ask the question, normal questions she might ask, thanks troubling with that loan last year. I've heard rates are going down. I'd like to see if I can save money by refinancing now, what would my monthly payment be? We fast forwarded the application was already done, but -- in this case, we hadn't pulled credit. We hadn't got -- we just check if credit consent is done. It pulls credit on behalf of the consumer, automatically behind the scenes, it checks to make sure they have assets that are necessary to have some reserves to pay the monthly payments. Checks the Blend income information. And now it's generating that scenario, a refinancing in the loan, which has a lower principal balance because Alice has been paying making our payments for a year. And so it's done that work. And now it says to Alice, that your current financial situation, you can bring your payment down to $2,000 from that original $2,200, and this includes property taxes and homeowners insurance. But Alice, maybe she's a little scared, its a tough financial decision. And perhaps she wants to understand a much more complicated question like how do I optimize, how much money I put down because I want to put as little down as possible and how much do I have to put down. These are -- by the way, these are really complicated questions that actually behind the scenes require these loan officers to go to 5, 6, 7 different systems. But in this case, copilot is going to go through all those systems, do all that workflow and compare the 2 options of what is a no closing cost option for a loan, going to cost for a month that she knows it's going to be more. And what are my closing costs if I'm willing to do that? And especially as rates start going down, this is going to be incredibly important. I don't know how many of you remember, but during the pandemic, there are so many of people trying to refinance these loans all at once that it created a massive backlog and consumers weren't served in a timely enough fashion and 3 or 4 months of higher payments are a meaningful impact to a consumer's financial situation. And so in this case, the copilot went and found all the options within the bank that are available to that consumer. The estimated closing costs for the refinance with the lowest closing cost option would be $826. However, please note that this now has a higher monthly payment. So now while I can do a 0 closing cost option or close to 0 closing cost option, it has a much higher monthly payment and the trade, and it actually explains nicely to the consumer and something I would say is a loan officer the trade-off for lower closing cost is typically a higher interest rate, which results in a higher monthly payment. And so I'm able to do that again, I might offer to jump on a call and serve that customer and a much more sort of bespoke way if I need to. But I think that's what -- that's kind of the essence of Blend. Like I said, 4 years ago, we showed the Blend Builder, and now we see it at scale with our customers and when we showed this product this year, it generated excitement. And while it's early days with Generative AI and early days of what this can do, it can already start to understand really deep things about the customer and really help the customer and understand deep things about all the bank's products. And this doesn't just apply to mortgage. I mean this is something that can apply to any product or any system that Blend is connected to. And so going back to one of our original value propositions of being the same platform across products and services will only continue to benefit and make an even smarter system for our customers, the banks and lenders out there to be able to serve their consumers. And so, I mentioned during the culture section that Innovation is sort of -- and by the way, I think culture is -- all levels of the organization has to be there. It can't just be -- you can't just have a Chief Innovation Officer in an innovation team. It has to be all levels of the organization. And so one of the things that we are making sure to do as Blend, because there's so much transformation that has to happen for us to achieve our vision is to keep investing the things that can really move the needle for our customers, and this is an example of that. And so with that, I'll turn it over to Bryan for a few remarks, and then I think we have a break coming up.

Thanks, Nima. So we are going to take a quick pause probably 15, 20 minutes. Feel free to help yourself to some more coffees, more snacks, again, restrooms in the back. Will come back and rejoin the presentation with Sebastian Joll, Head of Growth. Thanks, everyone. [Break]

Hello. We're going to get started about 2 minutes here. Just 2 minutes. If we can take your seats in the next couple of minutes, we'll get going. Hello, everyone. Welcome back. I hope you enjoyed this morning's presentations. I know I sure did. I wish investor -- building investor presentations was as easy as Mark made building configuration workflows. But I'll ask -- we've got a very exciting speaker coming up. Sebastian Joll is our Head of revenue and he's going to walk you through our GCM strategy for the company. So, with that...

Thanks, Bryan, and thanks to Nima and our presenters this morning. So Mark and Eric as well for walking people through the product. As Bryan mentioned, my role here is Head of revenue. So it means a look after our go-to-market team, sales, customer success, professional services and other folks that really help make our customers thrive in this market and the next one as well. And so in today's presentation, I'm really going to cover 3 main things. I'm first going to talk about the ecosystem that we work within, the other technologies that we see around us and the kinds of buyers that we see in our customers and what value they find in Blend. I'm then going to touch on a single customer story and walk you through what it looks like for one of our customers to purchase Blend and really buy into the platform strategy, grow with us over time to be able to come not only a single source of originations through the Blend Builder platform but also grow in their market and succeed because of the advantages our technology provides. And then finally, what I'm going to do is go through our market strategy. So talk a little bit about what we've been growing, the kinds of customers that we have been targeting and where we see the next couple of waves of growth coming from, as we go into 2024 and 2025. So with that, I'm really going to start with our technology ecosystem. And so what that means for us, is, we really work within originations, we see 3 layers of technology. And this is very generalized, hyper-simplistic. Outside these layers of technology, there's a ton of ancillary services and other tools we plug into. But most of our customers think through 3 things. I think through the point-of-sale layer, the loan originations system layer and they think through the core system as well. Each of these layers does something a little bit different, both giving a customer an advantage as well as creating complexities. And so with the point-of-sale layer, what we find is that this is -- if you go to our bank's website and click on a mortgage or a personal loan origination experience. This is really the layer you're engaging with. Now a couple of things here are relevant. First of all, you primarily find these in a digital experience. When you walk into a branch to deal with a banker, often they're operating at the next layer down in the loan origination system. But this experience, most importantly, is product specific. Most companies who provide a point-of-sale solution deal with 1 or maximum 2 products. And what that means is that the consumer needs to know what kind of financial service they need before beginning the experience. They need to know I need a personal loan or I need a home equity loan or I need a credit card. That both limits the consumer's experience and that it relies on them to know more to be able to go through the process. It also limits the bank, credit union or lenders experience to be able to provide recommendations. We had to guide them through and then cross-sell additional products during that process, which for all of our customers, they're trying to really gather depth of wallet and further penetrate every customer transaction is a real floor in the process. So the next level down for us is the loan origination system. So these are partners that we integrate with, they're really, really important in the process, really critical to our customers. They provide a lot of the brains of the origination system and hold a ton of complex logic. Now the difficulty with some of these systems is that often they can be limited in the UX or the UI that the LO , the loan officer and the banker deals with, and they can require the bankers and loan officers to be really expert, really trained to be able to navigate the system and originate the loan. It becomes a very human heavy process and quite cost intensive for the banks. What that also means is that the consumers struggled or very rarely even touch systems. So if you're thinking about having straight-through processing, where a banker and a loan officer and a consumer are all working on one source of truth and one system. This really prevents a challenge. And so while Blend does not replace the loan origination system, what we can do is support it and help smooth some of those gaps. And then finally, we had the core, which may be even more so in the loan origination system is based on, I know Nimo alluded to it earlier, is based on really old technology. And specifically for products like deposits, this really limit the company's ability to innovate and come to market quickly. The management of these systems requires talent that is extremely difficult to find in the market. And it means that executives who are looking to implement a strategy quickly are often hindered by their technology rather than supported by it. And so what we find in this environment when we talk to our customers and really talk to the CEOs, and this can be verified pretty easily. You look at the 10-K or public announcement of any lender in the United States. They will primarily talk about 3 things. They'll talk about wanting to drive down the cost of origination, particularly in this market. So I want to talk about beating the real fintech threat. They feel this threat viscerally. Fintechs have come in, innovated, disrupted the market and started to capture share from customers -- from our customers who were historically dominant in their space. So they feel that and they want to fight back. And then they talk about maximizing the potential of every single customer that walks in the front door or goes to their website. So all of the technology underneath, if you think about those goals, that is really hard to do with this disaggregated product siloed experience and technology systems that they're working within. A CEO is trying to cross-sell products. They're trying to get more products per customer. They are trying to make this a cheaper experience, more digital, more straight through rather than a slower human-driven process that is siloed into product experiences. And that's really where Blend comes in. Again, super simplified, but one of the things or the main value proposition that we talk about with our customers is we're really the only company out there that can provide a single point-of-sale solution across mortgage, home equity and into the consumer space as well. So if you're a CEO and you want to drive greater share of wallet, if you want to maximize the rare opportunities that come into your top of funnel, you want to be able to attach mortgage, all home equity, credit card, personal loans, vehicle loans to as many consumers as you can and give them the right product for their need, so they start to treat you as their primary financial institution. This is a real game changer as people disconnect from always having branch-driven and people-driven processes and try and build trust, which is incredibly difficult to generate in an online digital capacity, only through an incredible world-class experience that you get with Blend, only being able to provide recommendations that connect data sources from both public data and your internal data stack and only them being able to do it in a way that feels as effortless is ordering a car on your phone, do you create that trust and win that customer. One of the things we talk about internally and hear from our customers is that these banks, credit unions and lenders, they are spending millions of dollars, millions of dollars on marketing and trying to bring customers to their doorstep? And then with their digital experiences, they're putting a bouncer at their front door and turning them away. With Blend, with a world-class origination experience that allows the customer to find the right product, you bring the customer and you pull them through the funnel and convert them not only into a consumer of one of your products, but multiple products, and that's the value that we're delivering to the CEOs. Within the companies, within our customers, there are then really 3 kinds of buyers that we primarily deal with. And so the first is lines of business leaders, things like Head of Mortgage or Head of Consumer Lending. Next is our digital teams who are really looking after the digital operations and digital originations and then more and more technology leaders. And each of these buyers find a different value proposition of blend. So kind of like other large software companies, certainly sales force and somebody I'm intimately familiar with, we started off selling to heads of business. You can buy a Blend out of the box in many ways, you didn't have to do a ton with your internal IT department. And you knew that when you got Blend out of the box, it was a world-class experience. Those millions of dollars that you were spending out trying to find leads, you knew you would convert at a higher rate, do it at lower cost because it was digital and be at a close in a shorter amount of time, which is incredibly important for them to help them manage their balance sheets. And so the ROI, which I know Erik walked through a little bit before, was incredibly tangible for our business line leaders. And that value proposition is extended as we moved out of mortgage and into other origination workflows as well. Credit card, deposit accounts, personal loans. If you are trying to capture a larger share of a fairly scarce market today, or capture the lion's share of a fairly robust market in a good time, Blend gives you a competitive advantage of all the origination solutions otherwise exist in the market, and that's what our business line leaders are buying. They're buying confidence that when they use Blend, they will create the best outcomes for their top and bottom line. For our digital teams, the value prop is similar, but what it really brings is a lot of features that otherwise are incredibly difficult to implement in a more disaggregated technology stack. So I talked a lot about cross-sell already, and that's something you'll get out of the box. Somebody who needs to open up a mortgage and needs a deposit account, which is very common at our customers could do it in one flow. You can sell from one product to the other. Somebody who wants a home equity line of credit and also is interested in personal loans, can do both. We can do both in one flow. And that's really, really critical as again, we try and maximize, not only the number of leads that we win, but then the penetration of those leads. Are our customers able to sell as many products per user capture the household share of wallet as they can. There are other things in here like Omnichannel, being able to start online and walk into a branch and continue that experience with a banker if you need to. Particularly important in the credit union space, where our customers have enormous community presences. They rely on being able to blend, both the banker approach and the -- sorry, blend [indiscernible] But they don't try and blend their banker approach with their digital approach as well. And that Omnichannel out of the box is something that just wasn't possible before we released it in Bank of Workspace pretty recently, and gives us enormous upside to both capture additional volume as well as provide that richer, deeper experience. I've listed some other things up here. I certainly talked about user experience, AI and our configurable data model. The rub though, is for digital leaders in a bank, when they buy this out of the box, it puts them 2 or 3 years down their road map, than if they had tried to build on themselves on their legacy tech stack. They can now focus on converting and winning customers on their strategies and not on building the building blocks, the artifacts of war that they will take to market. We're giving them the ammunition and it's ready to go. And then finally, and maybe certainly most recently, we've really expanded into selling direct to technology leaders. Now this has happened in a fairly organic way, as we had mortgage or home equity and consumer and -- the different points in consumer, landed across one business unit. Technology leaders that they started to take notice. They realized, well, here's a vendor that we can work with and start to slim out our tech stack, start consolidating with one vendor who can do many things in our business. And that was great for us and got us close to the technology leaders, and then they started to see Blend Builder as well underneath, and realized not only is this a vendor that we can work with just to take load off our play, this is a vendor that we can work with that will help accelerate our own internal development, help us go from code to clicks, be able to use different kinds of resources, different levels of talent and move much faster support their business lines. Again, I sort of harken back to the story of Salesforce, which had a similar transformation, right? Went from selling to business line leaders to IT departments over many years as they build value. We are at that crest now where technology leaders are looking at us as a development platform as much as a provider of an incredible out-of-the-box workflow. So one of the things certainly that brought me to Blend though, was the knowledge that this story is really just starting. So I'm going to talk in a little bit about the customers that we have and kind of the presence in the market. But for us, it is only -- we really work with the vendor, the tip of the spear of customers and banks, credit unions and lenders that are looking to make this digital transformation and are at all equipped to deal with the Fintech threat. The advantage of working for Blend is that our customers are the blue chip of the lending environment. They are the largest lenders in the country and in many cases, the largest lenders in the world. That means that they invest on time horizons that are 10 to 15 years. What they tell us is they're looking to Blend now as their strategic partner, because we help them overcome much of the tech debt that's in their existing technology system, their technology stack. And that allows them to then fight fire with fire against fintechs, drive digital transformation without having to do open heart surgery necessarily on these 20-, 30-year-old systems that they might have that could be weighing them down. Not only does that position Blend well to work with the Vanguard, but as we do that, I believe digital transformation will become obviously much more than a nice to have for the other 4,000 or 5,000 lenders that are in the United States. Let alone the other lenders internationally that we can work with over time as this trend continues and Blend goes from being one of the leading players to the dominant player in this space. And so with that sense of why customers buy us, what I want to talk you through is how our platform strategy has really landed with one of our customers specifically, and give you a sense of what it's like to grow from mortgage into other products, and the value that provides the customer and then the value that reinforces the Blend. And so before I get there, I think it's important to understand our revenue model. Now I'm sure everybody in this room and on the telecast knows already that we're a success-based revenue model. So that means that we make money after we do a couple of things. We have to sell a product into a customer. They have to agree to use our solution. We then have to capture utilization. So of all the mortgages that customer A transacts, we need to ensure that they all touch Blend and go through Blend. And then ultimately, we scale with customer volumes. And for us, that's great. Again, I mentioned our customers are really the top tier. And through their over investment in technology, their investment in digital and their ability to do acquisitions in this downturn, they are growing market share. And so we are getting this lift, this tailwind just by the exposure we had to our customer base and the fact that they use the best technology. I know we reported in our last earnings call that we continue to capture market share. And that is in large part due to our customers win, our customers beat their peers and beat the market, and that's a trend that we think will continue. So what I want to go into though is back to the things that we really control. So selling our products and utilization. And when we think through that, I think there are a couple of layers of product that we have. So everything we do in the world is now increasingly anchored by Blend Builder as the center of our ecosystem. It really is our sun that we revolve around. Outside the sun, we had our primary loan types, then we have attached products. And what that means is primary loan types or things you might walk in the door or go to a dotcom website to try and get, attach products and stuff like clothes and verifications. That key off that transaction provide additional value to the consumer and generate additional revenue. And for Blend what that looks like is something like this. So when I think of our primary products, we have home equity, mortgage, personal loans, credit card, and then attach to these, for every mortgage or every home equity transaction, we will have additional products that can create a layer of revenue on top because it's driving additional value. And that's really important to Blend as we think about growing our market share and growing our top line, because we can do so by introducing additional products that solve discrete problems in the end-to-end workflow that attached to the same transaction. So as mortgage volumes stay stagnant or even when they grow, we can still grow our revenue by solving different problems in that journey and attaching additional products. And so let's talk this through this example. This is one of my favorite customers. I mean, all my customers are my favorite customers, but this is definitely one of my favorites. We call out this is a $10 billion or larger than $10 billion credit union. That's important because I think it's -- what it does is give you a sense that this customer, while larger, is not one of the largest in the country. This is not a unicorn in terms of a customer study, they're a little more advanced in their path down the platform approach with us. Actually, I think that's a good story to tell, but we have many customers in our book that are like this. So this customer that purchased mortgage -- purchased mortgage about 6 years ago. Following a successful implementation and good returns on that purchase, they then went and expanded into home equity and vehicle as well. About a year after that, they further expanded into our deposits product and our credit card product. Now what these bubbles on the page represent is that kind of give you a sense of the relative revenue that's available in that product, if we were to capture all of the transactions of the bank. And I'll talk you through a little bit how we go through capturing that revenue. Let's just give you a sense of scale as we further penetrate this institution, we keep uncovering additional revenue opportunities, which are mutually beneficial for us and the customer. Now with this customer, there was something called a pandemic in 2020. I'm sure you guys were aware of that. That put them into the Close and HOI space. They said, "Look, now we're looking for that digital experience and to really make it for the consumer as touch free as possible. And then even if we zoom forward to today, we're looking at additional products, bespoke lending products, title, verifications, other things that can grow Blend's revenues, service the customer and is mutually beneficial. Now that was pretty cool. It's a pretty cool experience for us to have a customer that kept seeing additional ways, kept asking for Blend to step over into a new line of business and bring that same incredible mortgage experience into other parts of the business that they wanted to grow. What gets really called though is what we're doing today. So we are currently transforming them from our older technology under Blend Builders. So they already have vehicle and personal loans on Blend Builder. They are already beginning to transfer their home equity product to our instant home equity product, which is a higher price point and a more flexible product. And they're beginning the transformation of their deposits product and their credit card product, under Blend Builder. This is cool because it gives us Blend as Blend Builder as the true anchor for their ecosystem, and it begins to open Blend Builder up to their IT department to see it as a development platform and something that we can monetize as an additional product within our stack. And for the customer, what they see, as we continue to go to Blend Builder and continue to anchor our entire ecosystem on it, is they see these advantages, which I know Erik touched on before. But with Blend Builder, they can innovate faster. In minutes instead of months, they can change how workflow works. They can introduce new data. They can change an adjudication process. What that means is as the macro changes and consumer demands change, be it from the 2020 pandemic to inflation today to whatever it's going to be tomorrow, they can change their go-to-market strategy rapidly. The flight of deposits that we saw earlier this year around Silicon Valley and other banking system changes, was really a super critical opportunity that did not last very long. Those banks and credit unions that were able to capitalize on that and capture deposit share by changing their go-to-market quickly, stood to capitalize on an almost once-in-a-generation event that everybody else would be left behind on. If you're going to be building your originations workflow in code instead of clicks, you will always be 2 to 3 years behind the market. You will always be chasing a road map and development resources to adapt your strategy to what you're trying to do. And if you are the CEO that we showed at the start and you're trying to innovate and battle fintechs, well you're going to lose. You're going to lose slowly, but you're going to lose. With Blend Builder and moving all of these products, we've talked about consumer and eventually mortgage, it allows you to anticipate and adapt and implement a strategy around going to market much more quickly. It also allows you to differentiate. Instead of an out-of-the-box robust workflow that is one fit for the entire market, you can say, well, our customers are a little bit different. We're subprime or we're going after jumbo loans or whatever it could be and change how you adjudicate and measure applications coming to your system and best fit it to your strategy. And then finally, cost is paramount. Cost is the single most important thing at our customers right now. 2 years ago, it was volume and now it's cost. With Blend Builder, as they move their consumer products and ultimately, mortgage to Builder, they will be at it -- originate at a lower cost, either through automation that Blend Builder provides, such as our instant home equity product, or by just requiring lower cost resources to do development, not needing all credit to our Stanford computer science people who work at Blend, but not needing Stanford computer scientists to always run their originations work for, be able to do it with clicks instead of code. And so I talked a lot about that journey, expanding into the product and now being able to convert those customers to Builder. And as we convert them to Build, they will win in the market, and we will benefit from that as a tailwind. As our customers win, it provides us an opportunity to grow top line and bottom line for Blend as well. But a really important part of our revenue model is not just selling the customer then having it utilized. And so what we try and show here is that same customer and how much of the revenue and that customer we have captured already. And so perhaps not a big surprise, in mortgage, Home Equity and Close have captured the majority of the revenue available. We can continue to expand that revenue by introducing more instant products, higher-value originations workflows, but we're predominantly standardize and capturing a lot of their volume. What you see on the right-hand side of the page, though, is a growth story. We have introduced consumer products, primarily in their digital channel. When we sold digital consumer to this customer, we didn't have a banker solution. There was no way to originate consumer in branch. And what that represents for us is an enormous opportunity to grow our revenue without signing or deploying another customer. Roughly, this customer brings in about $1.4 million to $1.5 million for Blend today. We estimate that at fully tapped, this customer will be worth $4 million or $5 million to Blend today. And so for those Math geniuses in the room, that means we're about 30% penetrated for this customer. It gives us an enormous potential upside as we go through the next 2 or 3 years, and our product has expanded its capabilities to adapt to the other solutions or the other use cases that we need, to move into this empty revenue space. And what other is I'll walk you through exactly what that looks like. And again, this is sort of idiosyncratic to each customer that we have. So in this customer's case, we have existing revenue, and this is a double click on deposits. The existing revenue we capture is about 14% or 15%. Again, that's the digital channel. Some customers are way bigger in digital than branch. This one is a little bit different. What we can do now is through our banker Workspace, they have an internal tool that they use to originate deposit accounts and other consumer loans in the branch. With Banker Workspace on Builder, we will be able to position Builder as a way to originate in branch, which if successful, opens up an additional 50% of their volume to Blend and allows them to use one technology stack, allows them to use the Omnichannel features, allows them to use cross-sell and AI recommendations, all of which isn't available in most banker tools. We can then do other things like add new products like certificates of deposit, a kind of deposit product. We already have that built for other customers. We just haven't turned it on and launched it at this customer. So that's an easy win for us. And then there are edge cases, stuff like cross-selling from specific kinds of products into a Blend deposit account. That is available that we can also roll out of this customer. And so what I want you to take away is, while there is an enormous revenue opportunity, there's also broadly with our capabilities today, a plan to go and capture it. It isn't fictitious. Yes, we have to win at the customer and show them the value was greater than whatever they're using today, but we have the capabilities to do it, which we did not have 8 or 12 months ago until we launch Banker Workspace and other capabilities, fully fledged on Builder. And this idea of capturing revenue extends to other products as well. So that was deposit accounts. This is verifications, and while this isn't the same customer, it's more of an example, we see the same lens. So the first step we take is just going and winning new users, convincing loan offices or branches or channels to process verification of income when they get a mortgage through a Blend. And that can often be a ground style approach, where we're going branch by branch and user by user. But once they're using verification of income, it provides a significant speed uptick in speed in terms of processing the loan and being able to get to close faster. But the critical thing for verification of income is not only did somebody click to use verification of income with Blend, but then could we get a data hit. And that often relied on us getting borrower information from payroll providers, which coverage is fairly fragmented and it's sort of vendor by vendor negotiation that everybody takes to try and get that coverage, to ensure that of all the clicks we get into income verification, we get successful hits and can charge for that. And that leads to today's announcement that we introduced assets derived income, which instead of needing to go off to a third-party data provider, allows Blend to use asset information and direct deposit information in the consumers' data to automatically verify their income. And what that means is it vastly expands our hit rate on income verification and immediately steps up the capture of revenue that we have. If X number of customers or X number of loans are already triggering verification of income, but only why we're getting successful hits, we have now materially expanded why, meaning that our revenue steps up in an order of magnitude, without having to do any new sales or any new deployments to automatically begin appearing when customers select into it. And what I want to give you the sense of is that this is an opportunity or a strategy that we really have just started. If you zoom back to 2020, we had about 1, 1.1 products per customer. Today, we have just under 3 products per customer. We have 10 products we can sell. There is enormous upside to continue to push our customer base up this chain. And because we're really blessed and fortunate to have the biggest customers in the world already on Blend, each of those product ads are really material. They make an enormous swing to Blend's revenue and Blend's potential. So it's a strategy that we've followed for the last 12 or 18 months. The strategy will continue to follow. We care deeply about our customers, and it's because our success is tied to their success. But as we bring them on to the platform, not only can Blend bring more to the top and bottom line, but the value of each individual product becomes greater, as we get cross-sell and other capabilities that are generated out of a platform-based approach. And then on utilization capture. Again, at the top level, there is additional upside here. And the thing about this upside, it is right there. It's at our fingertips. These customers are not only already sold, they're already deployed. By expanding to new channels, winning the battle to convert users, enablement, change management, we will be able to grow our penetration of our sold book really materially. And what we show you here is just an example. Mortgage, one of our older products, obviously, our first product, is better penetrated in our customer book. That's not a big surprise of our customers who have bought mortgage and more of them use it in a standardized way. There's still upside there, but as we go into the attached products like close and even more so verification of income, there's even greater upside. These are newer technologies, newer ways of working that not all employees, loan officers and bankers are used to doing. As banks go through their own internal change management as we open up channels and capabilities, we will capture that upside. It doesn't require signing a new customer, doesn't require deploying a new customer that requires rolling out and the adoption of features that we already have and features that people want to use. It just is a process that takes time to transform the bank. And so with that, I only have a few minutes left, but I would be remiss not to touch a little bit on how we're thinking about going forward. And so what this shows is it shows the rough penetration by segment of our different customers. And so the map that we have of potential banks, credit unions and independent mortgage banks, how penetrated we are already? Do we have one relationship for one product with any of these banks? So not surprisingly, as we've mentioned, we're really strong in the top end of the market. That's where we've been focused. Our expansion strategy in terms of continuing to sell the platform into our existing customers is going to pay a lot of dividends in that end of the market. But there's still space for us downstream. As we've modernized and matured the Builder platform, we're able to now sell it and deploy it at more scale down market. And so for us, as we think not only about expanding within the base, but selling more, there's significant opportunity there as well. And what that does is sow the seeds of success for 2026, 2027 as those customers get deeper and deeper into the platform approach as well. And so as I think about 2 things going forward, I think about 2 waves of growth we'll experience. The first is a little bit more short term, 12, 18, 24 months. That is the continuing expansion within our customer base. Moving into deposits, moving into credit card, moving into personal loan, adding verification of income, adding home equity, improving all of those products on the Builder platform so that those customers win, they will beat their peers and Blend will benefit from it. We'll continue to capture utilization. And then as people see the value of Blend Builder and begin using it more as a development tool, either with our resources or theirs, we are monetizing the underlying platform as a development tool for our customers. And then finally, in the short term, we're thinking about new use cases. I know Erik mentioned small business banking before and wealth management and other cases. We certainly think about personal other ways we can support in the CB space, the consumer banking space, but adding new use cases, adding additional sort of capabilities, pink circles to the platform, we will be able to sell more products and again capture more revenue through that blue chip customer base we have. And then in terms of the next wave, I talked about new logos already, the logos I sell today set the seeds for 24 months away. As they deploy and ramp and then expand into new products, those are the next $2 million or $3 million customers that we have, and we're going to sell them this year. Increasingly, we're working with partnerships, either other technology vendors who are like us in the originations ecosystem, working with a more flexible newer tech stack, and we think we're best of breed when we're together. We're doing deeper integrations with them, providing more value to our mutual customers and allowing each other ways to sell into prospects. So working with other industry folks like AWS to do go-to-market partnerships and scale. And then I know that Erik already mentioned our GSI relationships and how we will use them, particularly as we think about global. And global, I'll mention is the last element of that second wave. Now Erik you and I have to talk about Australia because I think we should go to Australia, you didn't mention them. But certainly, Western Europe, Canada, other countries and even French and other languages are all capable within Blend Builder. Mortgage for us has been historically fairly locked within the United States, because we're built to a local ecosystem that is frankly enormously complex and abide by regulations that are U.S.-specific. Build allows us to break away from that. It allows us to take the brand permission that we've built, the expertise that we've built, the go-to-market skills that we've built and take those lessons to ecosystems like Canada and the U.K. and other places that don't have the same constraints or the same partnerships that we see in the United States and build very, very rapidly into their market as well. And so for me, that is an enormous opportunity. And so I'm going to -- I think I just have a minute left. If I will wrap up with just one thing, though, I'll leave you with a sense that Blend has real upside in the short term, just because of the customers that we already worked with and have a platform-based business model with. The value of our products only expands when you do multiple products with Blend. It opens up all of the competitive advantages that the CEOs are looking for, as they look to control costs, have a world-class digital experience against fintechs and maximize share of wallet with every customer. So that's Blend strategy in the short term, but the upside is significant beyond that. We have been so focused over the last 12 or 18 months on our existing customers that we have as we've matured the product, now left ourselves with significant opportunity to grow outside that customer base. And I for one can't be more excited for that journey. And so with that, I think I pass back to Amir, our CFO, to talk us through some of the more financials of our presentation. Thank you, everybody.

Thank you, Seb. Okay. Well, you all have been sitting a long time. So if you want to do a quick stretch, this is it before we get into -- jumping in the deep end. So if not, let's get into it. Good morning, again, for all of you, I've had a chance to meet. It's great to see you again. For those of you who I haven't had a chance to meet, my name is Amir Jafari. I joined earlier this year as the Head of Finance and Administration. And prior to Blend, I had the chance and the opportunity to serve as the CFO of 2 private companies. And prior to that, I joined ServiceNow back when they were also going through their development of an app to a platform. And even though I started my career really in the realm of accounting and finance. I had a chance to actually grow it into being the GM as we built a business unit that I had a chance to create. So with that, I'm going to walk us through the opportunity at hand, and let's dive in. We've had a chance to share this with you just to reinforce it. As you can expect, not only the standard statement, but we are going to be making forward-looking statements. We're going to be talking about our non-GAAP metrics. And so again, the standard disclaimer. For today, there are 3 critical takeaways that we want for everyone. It's one, our vision. Our vision right now is more relevant than ever, and it's being reinforced by our mission. And you heard about this from Erik and from Nima. Second, clarity. Our intention is we're going to deep dive into our long-term operating model, with the intention of giving you clarity around our unit economics and the overall potential that we have. And third, conviction. We're going to share with you the opportunities that we have, much of which you've heard, that really fuel our level of conviction internally. Let's start though with our accomplishments. It's important for us. It's important to highlight our accomplishments, because it helps set the stage for where we are today. It also allows us to tie in how we're bringing our vision into reality. With that, let me give you a bit of a recap in terms of where we are today. We're quite fortunate. 2023 has been filled with multiple levels of execution and thus highlights. It's a testament to our focus and the execution that we delivered, and we're gaining momentum as we continue to increase our velocity, A few callouts. First, mortgage. Our mortgage business is continuing to evolve when we've added new features like soft credit. The formal launch of Builder for us in March of this year, it not only created tremendous momentum, but it also helped with the foundation for the future, which is starting with consumer banking, and we had the opportunity to reinforce this with the Navy announcement. We're doing all this while we're also laying a brand-new foundation, a foundation for scale and for financial leverage. This is going to continue to help us meet and beat the guidance that we've shared and as we increase our overall predictability. This rapid pace of progress that we're sharing with you, it's translating into results. Again, starting with mortgage. We have achieved record market share. We have new products, and these products are delivering meaningful contribution. This is allowing us to outperform versus the industry average. With regards to consumer banking, we have new logos. We're expanding with our customers. And with that, we have a healthy pipeline of deployments. Again, this is creating strong consumer banking momentum. It's the foundation for our future, which will expand to mortgage as well. As for our title business, our title business is back to a foundation that starts and stops with profitable operations. Our thesis from the time of acquisition continues to hold. We see opportunity, not just with existing customers, but with new logos and the ability to unlock digital opportunities. The recipe for success that's fueling all of this, it's our framework of operational excellence. We have a commitment across the organization and it's supported by 3 critical ingredients. The first, we are streamlined and we're optimized for scale. We are leaner, we have clear priorities and it's bringing everyone together. You're seeing the benefits as we've been able to reduce our operating expenses by more than $100 million. Second, we're efficient given those clear priorities and our level of focus. It allows us to emphasize what Seb mentioned, and it's resulting in the go-to-market productivity that you see. The outcome. The outcome is a 28% growth in our platform revenue per head. And third, the evolution of an app to a platform. It's benefiting our customers. But more importantly, it's actually benefiting Blend as well. We're able to innovate faster and that level of innovation is turning into an innovation multiplier for us. And as we bring these together, they are generating the results that you see across the board. Let me double click though. I'll double click one step further in terms of one of the outcomes of operational excellence, and it's our focus on gross margins. We've shown material improvement even while there have been record lower originations and the overall macro uncertainty. We've continued to execute against our goals, and we've lowered our cost base. But the benefits are beyond cost measures. It's tied to the value that we've delivered and more importantly, our ability to capture that value at the time of renewal. As a company, our decisions are ROI-centric, and also profitability is now the first focus for many of our lines of business. I'll expand. I'll expand a bit further on what this means. Blend as a whole is seeing higher gross margins. Our platform gross margins are at a record high. You may recall that in Q2 of 2023, we also reported 81% software gross margins. In our title business, our title business is back to providing financial leverage. And as we bring these together, that higher margin profile is exactly what we want as we enter our second phase. It's for that title business. I talked about gross margins, but I want to double-click. I want to double-click, given the strategic nature of title. We have a very strong product offering. We're uniquely positioned, in that we can provide both traditional and digital first opportunities. We have a strong customer base that's powered by the capabilities that we have nationwide, but we see the opportunity to expand, expand our customers and we see this through the synergies with our software customers as well. Because of this, we will add new logos as the market stabilize. Our continued focus on profitable operations will drive the future viability, but also generate accretive value, which brings me to our second phase. And as we move beyond this, let me take us into our second phase. We are building a bill to last company. Our second phase is fundamentally a larger opportunity because of our platform. I'm going to take you through a few of these opportunities, starting with our mortgage suite. We have an incredible customer base. It is hard to build a customer base that we have, and it's a testament to our first phase. We are always going to be customer first, but we now have the opportunity to deepen those relationships. Expand not just our wallet share, but also our mindshare. Within mortgage, there are 2 variables critical for success. The first for funded loan and the second is our market share. Let me touch on an example of how we're driving the success. It's the expansion of our per funded loans. We have shared with you our revenue per funded loan, but we want to give you additional clarity about the performance and the growth of the overall business. And we're sharing a new metric, our economic value per funded loan. Think about the economic value as the contract rate matched to the funding of the loan, while disregarding contract minimums. The metric further supports our ability to execute and expand our per funded loan value and through the strength of our attached products. Let's dive deeper. Let's dive deeper. Let me share with you more insights, not just in terms of what we can grow into, but what the overall potential is. In the last 2 years, we've seen our per funded loan metrics grow 40%. It's a direct correlation to value. We're continuing to execute. You heard about the opportunity ahead from Seb. We have an efficient go-to-market motion to capture this. But we see a clear path. We see a clear path to $90-plus in 2024. Nevertheless, what we want to emphasize is the runway ahead of us. We have plenty of room to grow as our customers continue to deploy and utilize. We see the potential for our fully utilized economic value to be roughly $170. We're continuing with core mortgage, but what we're doing is we are allowing our newer products to grow into their full potential. And now we're not guiding when. The key takeaway for us is that there is significant upside. I mentioned there are 2 variables. The second is market share. And let me start with just an update on the numbers. As we share our forecast with you, we use the MBA as the market size. We view [ Honda ] though, as the source of truth. And so what you're seeing is an update of the market size to reflect [ Honda. ] Please note, we have not changed any of the loans that we reported. More importantly, the first call out. We have a track record now that's over 3 years and beyond of growing market share. We've added 400 basis points every year, and technology is the clear differentiator. Additionally, our customers are going to continue to grab share, and we see that as the potential to be a catalyst into 2024. As for consolidation, it will be both a tailwind and a headwind for us, and it may impact the short term. But what we believe is our technology will win in the long term, as it has already proven to do so. This brings together the factors that we're doubling down on. And this fuels the success within our mortgage suite. With the insights that we've shared, it allows for the foundation for our outlook. We have significant upside potential for the next 3 years. As we march forward, our intention is to grow both our share and per funded loan. But it's important for me to call out. Even isolated growth in either of those metrics will be material, even at the current market levels, and yet even more dramatic as the market norms return. Speaking of the overall market. We recognized that we cannot predict the future. But what we can do is we can use history to be the guide for where we're headed. The first fact. In the last 30 years, we have been sub-6 million originations only 4 times. Second, an average of $6 million to $8 million of originations is the norm in recent history. We recognized we're in unchartered territory. The MBA is forecasting 4.5 million originations in 2023. That will become the lowest data point that you see. And those interest rate pressures, they will persist into 2024, we recognize that. But what we can do is we can -- every purchase transaction that's happening today is building the pipeline for refinance, and it allows us to drive innovation of solutions like the instant refi solution that you saw today. It allows us to turn a headwind into a tailwind. With history in mind, the scenarios that we view as likely are still well below the historical averages. Let's dive into the impact. The impact is specific to our operating model. Simply put, for us, we are well positioned for growth. Starting with our conservative case. As we maintain share, have nominal improvements in our per funded loan, we see the ability to generate a 12% CAGR from now through 2026. As for our base case, as you see the return to the low end of historical averages, with incremental share gains and improvements in our prefunded loan, we see the ability to generate a 25% CAGR, now through 2026. And as the market norms return, and as we continue to execute and further expand both our share and our per funded loan stance, we see the ability to generate a 35% CAGR, now through 2026. And this really helps solidify the entire growth story tied to mortgage. It takes us to Builder, the key pillar for our second phase. As we evolve to a platform for strategy, that journey, it starts with Builder and it starts with consumer banking. We've spent a lot of time talking about our platform. You've heard about value from Seb. You've heard about rapid innovation from Erik. There are 3 critical components for everyone to take away. First, with our platform, we have the ability to diversify our revenue. We can do this through new and existing logos, and we have the ability to power nonmortgage solutions that are countercyclical. That in turn, translates to countercyclical impacts to our own top line. Second, our free cash flow. Our free cash flow will continue to improve through multiple outcomes through a platform fee, not tied to seats, but tied to innovation as we provide a canvas to reimagine the future for our customers. In addition, not everything that we power is tied to consumption. And as both of these comes together, they will lead, not just to higher upfront payments, but also increases in RPO. And third, with regards to due expansion, expansion of not just wallet share, but also mindshare. Technology is at the forefront of our vision, especially as we push to being end-to-end. There are opportunities that we believe we have yet to consider, but will be unlocked with our customers. On the topic of diversification. As we segregate our mortgage versus nonmortgage transactions, we've already seen diversification play out. We see it with consumer banking and specifically with home equity and instant home equity. The countercyclical nature, it helps us stabilize the movements in our own top line and it drives the power of the suite of solutions versus a single application. Our mortgage base is strong, and that will continue to be a big part of our story in 2026. But expansion to 20% to 30%, it further validates our platform strategy. Being an end-to-end solution, with our consumer banking as the catalyst for both growth and predictability. I'll expand further. I'll expand further and speak more to predictability. We're now able to take advantage of multiple contract structures. The value in our consumption first approach in mortgage is going to stay. We believe we are well positioned with our customers. Builder and consumer banking, they can now drive a model that improves predictability and free cash flow, by providing a mix of both consumption upside and fixed fees. And what this means is that in our future, we'll see more balance. This slide is probably the best representation as to why I joined Blend. Now I know it speaks to consumer banking, but it's a great proxy for the opportunities that we have ahead of us. Consumer Banking is in its early stages. We're seeing strong demand. Our customers want to digitize. And we've already seen that growth in 2022. And as for 2023, the growth continues. Even with the overall macro and banking uncertainty that continues to loom. While we stay focused on our customers and innovation, we will be able to deliver a 30% plus CAGR from now through 2026. Seb spoke to why our customers trust us. They want to need digital transformation. Consumer banking is an even larger opportunity, again, as we push to being end-to-end for our customers. But with Builder, it unlocks even more opportunities. International. With both existing customers and the ability to add new logos across the world. The ability to work with GSIs, the global system integrators. It helps our customers both domestic and international. The canvas to reimagine the future, it is not just for our customers, but it will expand to our partners. New product offerings in the future. You heard about small business from Erik or generative AI, the incredible demo that you saw today. That level of rapid innovation, what it's going to do is it will unlock the ISVs, the independent software vendors to actually be able to build on top of Blend in the future. All of what I just shared with you is upside. It's going to start with consumer banking. We will extend the mortgage, and it will drive the foundation for better unit economics in the future. As for our TAM. We already serve an incredibly large opportunity with very low penetration. Nevertheless, our TAM is expanding with builder. We view the TAM for builder to be $15.5 billion. This brings together what you heard from Seb on cross-sell, and innovation, which you heard from Erik. We're bringing our vision into reality and Builder is the key pillar to achieve this. This pace of rapid innovation and go-to-market execution, it is paving the way for our third priority. We're moving beyond breakeven, and we're going to focus on generating cash. Let me bring all this together, both to our 2023 outlook and our long-term operating model. Let me start with 2023. We recognize that the macro uncertainties continue, but we do continue to execute. We are narrowing our guidance for Q3 2023 to the current midpoint and high end of guidance, which I'll expand on. I'll expand on that in just 1 second. But let me start with fiscal year 2023. We are guiding our platform revenue to $110 million to $114 million. We're guiding our title revenue to $47 million to $49 million, with the ability to deliver 71% platform gross margins. As for fiscal year 2026, we are providing guidance around market scenarios that we discussed earlier. We see our platform revenue of $200 million for our conservative case, $290 million for the market norm and with a base case of $245 million. We see title revenue of $60 million for our conservative case, $75 million for the market norm with the base case of $70 million. And across all of these scenarios, we will be able to deliver 75% platform gross margins regardless of the scenario. As I mentioned, we are moving beyond breakeven and being able to generate cash. We are guiding to non-GAAP operating margin of 15% for our conservative case, 25% for our market norm and 20% for our base case. We're also guiding to free cash flow. We are guiding to free cash flow margin of 8% for our conservative case, 18% for the market norm with our base case at 12%. It's the first time that we're now sharing free cash flow targets. It's a testament to the success that we see in our future and with our customers. This is the type of company that, in my opinion, represents a built-to-last company. Let me touch on Q3, as I mentioned. Again, we are updating and narrowing our guidance for Q3 to the current midpoint and high end of guidance. We have been able to continue to execute in Q3. With this, we are updating our revenue guidance to $28.5 million to $30 million for platform revenue and $11.5 million to $12 million for title revenue. I had a chance to share earlier. I shared earlier that we are leaner, and we are more focused, given our clear priorities. We are evolving with our customers, and we're leveraging the efficiency of our platform. Our Builder platform, it is allowing us to keep and accelerate our pace of innovation, but at a lower cost. The efficiencies tied to our go-to-market motions benefit from our platform. But again, with the ability to execute at a lower cost. As for G&A, we have rightsized our operations to establish what we need to focus on, which is people, process and automation. All of our functions are set up for success and scale. One final slide before I wrap things up. I want to be clear about our cash burn and more importantly, our ability to generate cash. Unlevered free cash flow excludes debt financing costs, and we view this as a valuable liquidity measure. I've highlighted the scenarios we're modeling. 2024 accepts the stage for our ability to minimize our cash burn, but also achieve our path to profitability in Q4 of 2024. Beyond this, the business is able to generate cash, as evidenced by the unlevered free cash flow in 2025, 2026 and thereafter. Please note, this is not intended to portray our ending cash position, as that would include our debt paydown. As for the put option. As for the put option that we have with Mr. Cooper, who we purchased the title business from, the contract is detailed. The put option is 9.9% of Title365 exercisable on June 30, 2026. The purchase price of that put option is roughly $65 million under the contract. However, the contract terms are detailed and as I have noted, we have certain rights that will allow us to extinguish the put option under certain conditions. We are transitioning our focus. First, on providing clear context on how we plan to meet our capital obligations. And second, on giving us the ability to actually explore strategic alternatives that will further strengthen our balance sheet. Nima and I, we've shared repeatedly that we feel confident in our ability to meet our capital obligations, that remains true today. Let me wrap it up and bring it all together. For our mortgage suite, we have a very strong customer base. And with those customers, we are winning share, and we are growing our wallet share through our revenue per funded loan. As we expect 2023 to be the bottom, we are staged for success. Phase 2 will be platform first. We're delivering on results through a diversified revenue stream and improved unit economics that include the acceleration of free cash flow. This is the foundation for our future. The discipline that we now have is ingrained in our day-to-day operations. We will always monitor our performance through the lens of operational excellence. As we continue to build a built to last company, we will generate the cash necessary to meet our capital obligations. And this concludes our presentation. On behalf of all of us, I want to thank all of you who made the trip to be here today. A huge thank you, and we're looking forward to working with all of you in the future. Let me ask Nima to come back to start Q&A and Bryan as well to guide us through. Yes, thank you.

Thanks, Amir. Just hand off that mic. I think we're just looking for Nima at the moment and he should be here shortly. But while we're doing that, I'm just going to go over some housekeeping items for Q&A. That's for you. I think -- so if you don't mind raising your hand to ask a question for this section. When you do get a mic, one of our members of the IR team, Jordan and Emily will hand you off the mic. Because this is a recorded session, if you don't mind introducing yourself, where you're from, that would be great. At the end of the Q&A session for this room, we'll open it up to questions on the webcast. For anyone right now, there should be a box open in there that you can enter your questions and feel free to start populating those now. We might take a couple of minute pause.

I think I'll take 1 minute break.

We'll take a 1 minute break. We just got to track down Nima. [Break]

So we got team here. Yes. Perfect.

Guys. Great presentation. It's clear why Blend is gaining share in the market and looking forward to that consumer product set gaining the traction that mortgage has over time. I'm Joe Vafi from Canaccord. Just a couple of questions. I mean, since you just ended, maybe we'll start with you. Thanks for laying out those free cash flow guidance numbers through 2026. I guess we understand how the revenue could grow under the different scenarios, but maybe drill down a little bit more in costs, if you look maybe even to that conservative case of 8% free cash flow margin through 2026. What's that implying relative to your cost structure? Is it continuing to -- is it going to stay flat? Is it still coming down? Or are you at critical mass on the downside and we're going to start to grow it again and then a quick follow-up.

Yes. Thanks, Joe. Good to see you. The right answer for us in terms of how to think about it is that there are certain scenarios as we shared with the conservative with the base in the market norm. There are certain cost components that we can actually leverage to be able to continue to reduce our cost. The end position of what we share with regards to the -- not only the cash that we generate, but the operating margins that we showed, are the right way to think about how cost will move to in essence, meet those numbers. So we talked about, in essence, our revenue. We gave you the scenarios for what -- to think about with regards to platform gross margins. And you should think about the cost of having certain elements of variability that we can move up and down to ensure we hit those numbers for the ranges that we shared.

Got it. And maybe a little early for this, but looking at the term loan in 2026 relative to, like, say, your conservative case assumption, what kind of optionality at that run rate of cash flow do you have in addressing the term loan that's going to be coming due in 2026?

Yes. It's not too early to talk about. First of our term for our term loan, we have an incredible partner in [indiscernible] who holds that term loan. Second, I think the actions that we're taking are exactly intended to achieve what you said, which is to give us that optionality to unlock the opportunities that we want as specific to that term loan. The things that you could consider is for what we shared, the potential to potentially create a paydown structure in the future. But those are all things that we will unlock as we continue to execute on what we shared above.

Great. Mike Ng from Goldman Sachs. I wanted to explore a facet of the mortgage suite 25% CAGR outlook through 2026, specifically around the economic value per funded loan growth. Could you just maybe just talk about some of the assumptions embedded in that? Is that more core like-for-like price increases? Is it more about the attach of adjacent products like income and close? And if you could maybe just expand on the -- that new disclosure, how does that tie into the revenue metrics that you'll be disclosing?

Happy to. Let's break down the first part of the question. The way to think about it is what we shared. There's the ability to grow into what we already see for our per funded loan. That's like $90 plus that we talked about for 2024. That happens to what Seb mentioned, which is we have customers that have these solutions, but we continue to push them to help deploy and utilize those capabilities. That's how we grow into 2024. To your question around 2025 and '26, we've already shown that our core mortgage solution adds value. You can expect that, that will continue. But the bigger piece is what we mentioned, which is as these attached products become more and more utilized for what they do, and they provide more value to our customers, that is then what allows us to, in essence, expand that per funded loan metric to be able to continue to grow to the levels that we share. And just to recall again, what we said is that it has the ability to really not just grow into the $90 plus, but to think about the fully utilized potential of that to be $170. That was part one. Part 2 was the difference in the discussion. On our earnings call, we obviously shared with you our revenue per funded loan. But it's important to note, this is a segregated calculation, and it's not intended to bridge the 2. The economic value, the way to think about it is we often want to make sure that, in essence, the stats that we shared with you create a new metric, a new lens of being able to understand how much value are we creating with our customers, thanks to the economic value, while being able to disregard certain things like contract minimums and really being able to paint that picture, for not only our ability to grow into it, but also for our ability to be able to express to all of you, how that grows again into the $90-plus range in 2024. And again, has the potential to grow into the $170 range. Hope that I answered it, Mike.

David Unger, Wells Fargo. Great stats today. I appreciate it. The TAM, the 2026 revenue target that you outlined, I'm trying to get a sense for the growth coming from ex U.S., I mean it looks like there's a much bigger TAM globally versus just the U.S. So wondering what's embedded in your assumptions there and how to think about growth outside of the U.S.?

The easy answer is, what we shared with you around 3 parameters are all upside. So first, your question on TAM. You're right, we see the TAM opportunities tied to international and new solutions, like small banking as an example. What is not in our numbers is exactly that. We do not have international expansion in our numbers. We do not have the ability to partner with the GSIs, which is a natural stepping stone for us, as you think about international and larger customer sets. And we do not have the independent software vendors, the ISVs, which ultimately, over time, will be able to build on it. So to be clear, those 3 pieces are not in our guidance figures. They are in our TAM because for the first time with Builder, we see a clear path of being with actually achieve those.

Dylan Becker from William Blair. Nima, maybe starting with you from the platform approach. Obviously, it seems like a lot of the emphasis from customers today is on the cost side of the equation and driving efficiency there. There's a lot of value unlock and owning different components of that workflow to where it can turn to the revenue side of the equation. So I wonder how you think about that serving as a catalyst of kind of incentivizing this cross-sell motion as the story plays out over the next kind of 3 to 5 years?

Can you clarify the question to make sure I'm understanding it right.

So just, I guess, from the purchasing pattern behavior, shifting from an emphasis on cost efficiency, to utilizing again at network dynamic of where it can be the revenue synergy side of the equation that really incentivize this cross-sell.

Yes. I mean actually, interestingly, what we're starting to see and good anecdote I can give is at Blend Forum, one thing we unveiled is how our next generation of mortgage is going to look on Blend Builder, which we started some work on now. And what was particularly interesting to me was, given that there's no rate in term refis happening right now, how much focus that got from our customers, our mortgage customers, in particular, those that have -- that are banks that have servicing books or that are mortgage companies that have servicing books. They are starting to think about lifetime value in a much deeper way, and being able to capture those customers that they work with today for their next product, the next financial milestone, which, in that case, might be lowering their rate or in the case -- some of the cases that were shown by Erik and Seb around, hey, you've got a mortgage with us, if you open a -- somebody is telling me an anecdote about this over in the side. If you get -- if you got a mortgage with us, if you click here to open a bank account with us, you transfer $25,000 into it, we'll give you a discount on your mortgage. Our customers are trying to think about that. And in fact, in some cases, doing that very manually today. And so embedding it into a platform like Blend Builder that they're using already, makes a ton of sense for them. Actually, we've gotten requests for things like that for years. We just didn't really have the capability set to do it in a not so custom way, if that makes sense. So now that we can do that in a scalable way, I think that will be a very natural extension of what we do. Actually, one of the really interesting anecdote is one of the very large credit unions that we work with, they're looking at how do they serve their member across all products. So a member might come in with a specific need, but by pulling all that members information, their credit information, their income, any assets they have, like a mortgage they might have with that credit union, they can be very personalized with the product that they show to the member is like, hey, this is the one that probably makes the most sense to you and take them down that path. But in order to do that, again, they need all their products on Builder, which is what they're thinking about with us now. And so there's a lot of things happening, different permutations along this space, and I think Blend Builder puts us in a good position to execute on that.

[ Zack Savic ] from [ Entitled Investments. ] I guess just on the cost side, guys. So of the $130 million-ish of run rate OpEx you guys spoke to in '24, any rough quantification of what percentage of that is tied to the title business today?

We have not provided that level of guidance. I think the best way to look at it is what we've shared with you, which is the parameters that tie both in terms of where we're spending on sales and marketing, R&D, but we have not taken title down to the point of giving you that level of guidance.

Super helpful. And I guess, maybe just related to that then, has anything changed in kind of the medium to long-term vision for title?

Well, the first -- I'm going to give one tactical operational answer, and I think Nima will give you a better vision answer, which probably takes it back to when the business was purchased. I'd say the biggest change that we've seen is exactly what we highlighted. Today, every action that we take within title, it starts and stops with profitable operations. That fundamentally, in essence, changes the way you focus, how you serve your customers, the SLAs that we deliver, the opportunities that we share with them, not just with regards to traditional title, which is still there today, but the ability to unlock digital opportunities for them, as they think about their stream of solutions horizontally for the journey. So that's the short-term change.

Yes. And going back to why we purchased title company in the first place, especially for refinances and for home equity, having a centralized really efficient, very digital title operation, is important, because every single consumer who's getting a 6% and 7% and 8% mortgage today is going to need to go through a process of getting a refinance to lower the rates if rates go below 6, and that's -- there's 10 million plus that will be in that range by the time rates are below 6. And so having that hasn't changed, I think the macro has changed a lot around us. And our focus and investment, we're still investing in that business, making it profitable and efficient. But it's just -- it's going to be a timing thing. And we can't predict exactly when that's going to happen on the title side. But nothing has changed. We want to have an integrated experience. We want to have an integrated experience for our customers and ultimately, for consumers to lower the cost to them. So that when they do refinance, they can save as much money as possible.

Ryan Tomasello from KBW. Thanks for the presentation today guys. Amir, just one for you. I think you highlighted some opportunities, different rights you have with the put option with Title365 in different scenarios, maybe just putting a finer point around what those look like and what it would take to potentially exercise those?

Yes. I think the finer point that we would share today is really tied to what I said, not necessarily going at a level below that, which is as folks have asked us about that, making sure that people have had a chance to actually understand the details of that contract and the rights that we have mutually on our side, for the ability for certain conditions that would actually allow us to extinguish it. There's not much more to go into beyond that today, but just making sure that there's clarity around the certain options. And also that value that people quite often talk about, that's tied to the purchase price at the time of the acquisition, not necessarily where we are today.

And then just a bigger picture question, Nima, for you. Obviously, Blend has carved out a very attractive moat in mortgage over the last several years, and consumer banking clearly presents a lot of upside for growth. But curious how much time you spend thinking about broader strategic alternatives given the mortgage backdrop, some scale, nuances with the business. Could Blend ultimately be an attractive partner to another scale platform out there? Is that something that you would consider, obviously, not an easy question to ask, but one that we get from investors.

Yes. And look, I get it, the mortgage market backdrop is, it's pretty unique. I mean it's not been like this for a very long time, if ever, in mortgage, in terms of unit volumes. And of course, anything that comes to our desk that we have to -- we have a right fiduciary right as a Board to share that responsibility -- to share that with our Board and talk through it. But what I can say from my perspective, as a large shareholder and somebody sees all the upside and Blend, I think we will be one of those scale players one day. And we're going to keep building -- and actually, we're using Blend Builder to be able to invest and build things at a lower cost during a time when nobody else is investing. It's really hard to invest in the mortgage space right now. It's really hard to invest in the banking space right now, when budgets are tight for them as well, and we're able to do it. And so frankly, I feel like we're better positioned today than there -- than we would have been in the absence of a downturn. It's just really hard to see with all the clouds that surround this macro.

Just a couple of quick follow-ups, Joe Vafi, Canaccord. I think in some of the slides, you mentioned part of the growth is going to come from scaling into perhaps smaller FIs and smaller lenders. What do economics look like for smaller customers versus some of your big ones? And then one more quick follow-up. I know Seb was talking about some of that earlier.

Yes. So certainly, smaller lenders is a place that we have had exposure to historically. Blend sold to a lot of the smaller lenders in its first 8 or 10 years. Hasn't been a particularly big focus for us in the last 12 to 24 months as again, we buckled down with our big lenders. Look, the mortgage market and banking generally is more consolidated in the top end. So we have a really rich vein to mine with our existing customer set. But the economics down market, as we really change how we service those customers, allowed to make it more self-serve. The product has matured to be able to do things more automatically, gets pretty attractive for us. Even on products like Close, some of our back-end operations have been materially streamlined, which makes selling to the smaller customers are pretty attractive as a way to layer on additional avenues of growth. So for me, I'll continue to pursue these bigger customers and expand with them as my first part of call. That's definitely an opportunity that 24 or 36 months ago. I don't think would have been a profitable segment for us, and now it can be something that we win really collectively with the customer.

Great. And then, I mean, it's counterintuitive actually in the current macro, but some of the other names we follow that are selling software into the banking sector. Some of them have shown some pretty resilient and strong numbers. And the bottom line is they've got good deal flow, because of this war for customer deposits that's going on out there. I know, obviously, you put a really big circle up there in the upsell capability and deposit. How strategic is deposit right now in the kind of whole go-to-market relative to what customers are really looking for today?

Well, I'll start with an anecdote. I was on a kickoff call with one of our newly signed customer, a small credit union based on the East Coast. And it was a customer that specifically wanted to drive new membership and deposits because that's part of their growth strategy. It's very important to them to be able to do that at a time when cost of capital can be high in other scenarios. And so it is something we hear a lot. And we announced the Navy Federal deal earlier this year. And so we're working with them as well. But there's a number of customers who're working with on this. And I'll say just back to the first question that Seb mentioned, being on this kickoff call with this specific credit union that just signed with us, it's 6 weeks to get that thing live on Blend Builder. We have the components prebuilt. It works across all their channels if they need it, and the first thing they're talking to us about on that call to kick off a 6-week project to get this first piece live, is, okay, the next thing we're going to do, and they've already got this teed up and signed with us is consumer loans, auto loans, et cetera. And so it just becomes a natural way for us to work with these smaller customers when we can do it in an out-of-the-box and low-cost way with Blend Builder, that maybe wasn't possible 2 years ago. So again, I feel well positioned to actually serve that smaller end of the market and do it profitably and actually get pretty good economics for it and for us as well in providing enough value to them, because it is so important to them to drive deposits.

Well, we don't have any online questions that weren't already answered here today. So with that, I want to say thank you all very, very much for making the trip out and attending our very first Investor Day. Thank you to everyone who joined the webcast online. Thank you to our presenters. Really appreciate it. That's it for today. We'll break for lunch.