# LEX Markets Financial Model Two-sided marketplace that securitizes individual commercial real estate (CRE) assets and enables retail trading of equity shares via an SEC-registered ATS. - Canonical: https://finamodel.com/startups/lex-markets - Excel download: https://finamodel.com/startup-models/lex-markets.xlsx - Category: Fintech - Model type: Marketplace / GMV - Funding round: Series A - Funding: $15M - Founded: 2022 - Geography: USA (US regulatory framework: FINRA, SEC, DTCC, Reg A) - Customer: B2B2C ## About the company LEX Markets is a two-sided platform that securitises individual commercial real-estate assets and enables retail trading of equity shares through an SEC-registered alternative trading system. It brings issuance and secondary-market access to properties that would normally be privately held. The company can earn fees when a property is brought to market and again as investors trade securities on the platform. Its growth depends on both a pipeline of attractive real-estate sponsors and enough investor liquidity to support secondary trading. The model should forecast listed property value, number of issuances, underwriting or issuance-fee yield, secondary trading volume, and transaction fees. Sponsor acquisition, investor accounts, market-maker activity, and regulatory or operating costs should be visible as separate drivers of an exchange-style P&L. ## What's included - 5-year monthly revenue build with stage-appropriate growth assumptions - Full P&L, headcount plan, and operating-expense schedule - Cash-flow statement, runway, and burn-rate tracking - Valuation via exit multiple with a DCF cross-check - Returns analysis with MOIC and IRR - Unit economics including CAC, LTV, payback, and cohort retention ## Product & value proposition Three vertically-integrated pillars: 1. **Supply** - Licensed investment bankers take individual CRE buildings public via a securitization template (minority equity stake sold as non-voting permanent capital; sponsor retains control). 2. **Liquidity** - Proprietary SEC-registered Alternative Trading System (ATS) powered by Nasdaq matching engine; T+2 settlement via DTCC/CNS; accessible to market makers and any brokerage. 3. **Demand** - FINRA-member broker-dealer app (iOS); integrated with Apex Clearing; open to non-accredited investors; shares tradeable via LEX app or existing brokerage accounts / RIAs. Investor experience: buy from $250/share, earn quarterly distributions from rent, sell freely on the ATS without holding periods. ## Market - Potential distribution partner platforms: 100+ million investors - Total AUM on those platforms: $20+ trillion - No formal TAM/SAM/SOM breakdown presented in the deck. - Competitive positioning framed qualitatively: LEX is the "only option for single asset, freely tradable shares of real estate" - intersection of single-asset and publicly tradable, distinct from traded REITs, non-traded REITs, Fundrise, YieldStreet, Cadre, CrowdStreet, etc. ## Revenue model Not explicitly stated in the deck. Implied revenue streams (inferred from business model description): - **Issuance / underwriting fees** charged to CRE sponsors when LEX takes a building public (investment banking function) - **Transaction / trading fees** on secondary market activity via the ATS - **Potential spread / maker-taker fees** from market makers operating on the ATS - Share price at IPO: $250/share; illustrative trading prices shown at ~$248–$254/share ## Traction & metrics - 12,000+ registered users (LIVE) - 1,600+ brokerage accounts opened - 1 asset successfully taken public in 2021 (first CRE IPO on the platform) - ATS live: continuously matching orders 9:30–4:00 on all business days - Assets in illustrative user portfolio shown: 3 properties, $78.1M asset value - Illustrative share prices: GWYGU Gateway Garage ~$252.09/share, PKPLZ 12 Park Plaza ~$248.12/share ## Competition / moat Competitive landscape: - Positioned at unique intersection of "single asset" + "publicly tradable" - no direct competitor occupies this space. - Non-traded REITs, Fundrise: not single-asset or not tradable. - Traded REITs: portfolio-based, not single-asset. - YieldStreet, Cadre, CrowdStreet, PeerStreet, RoofStock, RealCrowd, Realty Mogul, Building Bits: single-asset but not freely tradable. Moat sources: - Regulatory licenses already obtained: SEC-registered ATS, FINRA-member broker-dealer, Reg A securities - Nasdaq technology partnership (ATS matching engine) - Apex Clearing integration - Moody's Analytics property data - DTCC/CNS eligibility and CUSIP securities - enables distribution through any brokerage - First-mover: first CRE asset securitized and listed in 2021 ## Team & funding ask / use of funds - Partners listed: Nasdaq (ATS/UMS), Moody's Analytics (property analytics), Apex Clearing (clearing & custodian) - Investors: Greycroft, Thor Equities, Raj Capital, Gaingels, Modern Venture Partners, Kawawa - No team slide, no individual names, no funding amount, no round size, no use of funds disclosed. --- ## Recommended financial model - **Archetype + why:** Marketplace GMV / take-rate model with a dual-revenue layer (issuance fees + ATS trading revenue). LEX is a two-sided marketplace where gross property value listed (deal flow) and secondary trading volume are the primary top-line drivers. This resembles an exchange/marketplace P&L more than a SaaS or DTC model. - **Forecast horizon & granularity:** 5-year annual model (2022–2026), with monthly granularity for Year 1 to capture ramp. Nov 2021 deck → Company is just post-launch. - **Key drivers & assumptions:** *Supply side (deal flow)* - Number of CRE assets taken public per year - Average property equity tranche size ($M per deal) - Issuance fee as % of equity raised *Secondary market (trading revenue)* - Total shares outstanding (cumulative deal flow × avg shares per deal) - Daily trading volume as % of shares outstanding (annualized turnover) - ATS fee per share traded - Share price: ~$250 at issuance *Demand side* - Registered users - Brokerage account conversion rate (accounts / users) - Average invested capital per active account *Cost structure* - Personnel (IB team, compliance, tech) - Compliance / regulatory maintenance - Nasdaq ATS technology licensing - Apex Clearing per-account or per-trade fees - **Scenarios (Base / Bull / Bear - which variables flex):** - **Bear:** 1–2 deals/year, low user conversion, thin trading volume, issuance fee compression - **Base:** 4–6 deals/year by Y2, 13% account conversion maintained, 30% annual turnover - **Bull:** 8–12 deals/year by Y3, 20%+ conversion, higher turnover as market makers add liquidity, 3rd-party brokerage distribution channels open up - **Required sheets / outputs:** 1. Deal Flow & Issuance Revenue (supply pipeline: deals × avg equity tranche × fee %) 2. ATS Trading Revenue (shares outstanding × turnover × fee/share) 3. User & Account Funnel (users → accounts → invested AUM) 4. Opex Build (headcount by function, tech/compliance costs) 5. P&L Summary (revenue, gross profit, EBITDA) 6. Cash / Runway (burn rate, implied funding need) 7. Scenario toggle (Bear / Base / Bull) ## Frequently asked questions ### Is the LEX Markets financial model free? Yes. The LEX Markets model is a free Excel download with live formulas. ### Can I change the assumptions? Yes. The workbook is editable and its live formulas recalculate when assumptions change.