This document introduces the Human Capital Score, which measures the value of an education by generating 10-year income projections based on a person's achievements and educational choices. It was developed by labor economists to address limitations in traditional credit scoring for students and aims to increase transparency in higher education costs and outcomes. The founders seek investment to spin out this technology into a separate venture focused on consumers and tools to improve college planning.

1. PEOPLE CAPITAL
THE HUMAN CAPITAL SCORE:
MEASURING THE VALUE OF AN EDUCATION
People Capital, 111 East 14th Street, Suite 285 New York, NY 10003
Thomas Shelton, CEO, tom.shelton1999@gmail.com (917) 693-1019
Investor Introduction
This document contains trade secret information. Please be aware that no part of this presentation may be reproduced in any form or by any means, electronic or mechanical, including photocopying and
recording, for any purpose without the express written consent of Quest Growth Partners, LLC (doing business as People Capital). In addition, due to the proprietary nature of Quest Growth Partners’
methodologies and other information enclosed herein, this presentation may not be shown to any third party without the prior written consent of Quest Growth Partners, LLC.
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2. Overview
• The Human Capital Score™ is an income risk and projection engine
– Driven by achievements (e.g. SAT, GPA) and choices (e.g. school, major)
– Generates 10+ year income projection of young adults
– IP and academic research developed by Wharton/Harvard labor economists
– Patents filed in Jun ’08 and Jun ’09
– Primarily implemented as an API
• FICO® credit score is broken for students/young adults
– Initially developed to create an alternative credit score for students
• Developed by People Capital, a student loan technology company
– Serial entrepreneurs from finance, Internet and student loan industries
– Primary goal has been origination, servicing
– Raised $5 million equity throughout the recession
• Seeking investment to spin-out Human Capital Score into a separate venture or
pivot People Capital
– Disrupt higher education by measuring its true value
– Target consumers and consumer-oriented companies: college planning, personal finance, media, etc
– Use transparent, easy to use tools and metrics
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3. Founding Team & Consultants
Name Background
Tom Shelton • Founder & CEO People Capital
Founder & CEO • Serial entrepreneur CyberStream Solutions, Strive Medical Technologies, Jeremy's Microbatch
• VP Strategy & Operations, MyRichUncle (private student loan provider)
• Co-inventor of the Human Capital Score™
• Majored in Economics, with a concentration in Management, at The Wharton School
• http://www.linkedin.com/pub/thomas-shelton/a/607/188
Alan Samuels • CEO of Clearpath
Co-Founder, Consultant • Executive Vice President, Strategy & Operations at GrubHub.com Dotmenu, Inc
• Co-Founder & EVP People Capital. Led development of HCS
• Managing Director, Global Product Development, Fitch Ratings, VP, Standard & Poor's/McGraw-Hill
• Former strategy consultant at Arthur Andersen and Gemini Consulting
• MBA The Wharton School, BA University of Cambridge
• http://www.linkedin.com/in/alansamuels
Prof. @ Harvard • Higher education economist and world leading academic
Senior Academic • Currently leading HCS R&D. Improving and expanding the HCS to address a wider range of higher education
Consultant issues
CONFIDENTIAL CONFIDENTIAL CONFIDENTIAL
Prof. @ Wharton • World leading academic in the field of labor, insurance and risk management
Co-Inventor HCS • Co-inventor of the HCS
CONFIDENTIAL CONFIDENTIAL CONFIDENTIAL
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4. Founding Team & Consultants
Name Background
Laura Vincent • Research Coordinator, The Paul Milstein Center for Real Estate, Columbia Business School
HCS Research Analyst, Consultant • Data Analyst and researcher at People Capital, focused on Human Capital Score™
• Researcher, National Institute on Retirement Security
• BA in Economics and with honors from Amherst College in Massachusetts.
• www.linkedin.com/in/vincentlaura
Jim Wiegand • Currently Technology Director, Pro Bono Net
Engineer, Consultant • VP Engineering, People Capital/HCS
• 15 years of experience implementing internal and external applications, including high-transaction systems
and web-based financial systems. Previous positions at Coach, CIT Group, Merck.
• http://www.linkedin.com/pub/jim-wiegand/4/44a/594
Jacques Tohme • Experienced in corporate finance, investment banking and advisory services
Corporate finance, Consultant • VP, Corporate Finance and Development People Capital
• MBA from NYU, Engineering from Columbia
• http://ro.linkedin.com/in/jacquestohme
Josh Mailman, Serious Change, LP • Founded Serious Change, LP, the Social Venture Network and the Threshold Foundation. Currently a lead
Investor in People Capital investor in the following organizations : Indigenous Designs, Alter Eco, Lotus Foods, Emerge Financial, Social
Imprints, Ice Stone, General Compression, Red Rabbit, Blue Ridge Produce, PharmaSecure, Leapfrog Ventures,
frogtec, Clinica de Azucar, Equilibrium Capital, RSF Mezzanine Fund, Return Textile, Icon Wheelchair, Everyone
Counts, Napo Pharmaceutical and Baltix Designs.
• www.linkedin.com/pub/josh-mailman/23/168/9a5
Warren Serenbetz Jr., Radcliff Group, • President & CEO of Radcliff Group a private equity fund
Inc. • MBA from Wharton
Investor in People Capital • www.linkedin.com/pub/warren-serenbetz/8/201/120
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5. Higher Education Market
The $260+ billion/yr Student Funding
Market by Source Inflation-Adjusted Tuition & Fees 1982-2012
Personal*
Private Loans
Federal Loans
Grants
Education Tax
Benefits
Sources: College Board, Trends in College Pricing, 2011
*includes: non-education loans, credit cards, home equity financings,
family or self-financed
Sources: National Center of Education Statistics and College Board,
Trends in Student Aid Trends in College Pricing, FinAid
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6. A Huge and Important Problem
• Higher Education costs $260+ Billion/year.
• The Federal Government and the Gates Foundation Higher Education, Income and Unemployment
are now focused on the economic value of an
18% Average annual income Unemployment $140,000
education. Creating demand for HCS products.
16%
• Tuition costs have increased at twice the rate of 14%
$120,000
inflation $100,000
12%
– Federal loan limits have not kept pace with tuition costs $80,000
10%
– Traditional funding alternatives are now limited, i.e.
8% $60,000
private student loans, credit cards, home equity,
6%
investments, etc. $40,000
4%
• Need for transparency and accountability to value $20,000
2%
services provided by colleges and universities
0% $0
– Students should understand the financial ramifications Less than High school Some Associate Bachelor's Master's Doctorate Professional
of a particular educational path H.S. college
– Allowing lenders to use the students “Debt to Projected
Income ratio”. †Note: Unemployment data as of January 2010; income data from median full-time,
– Helps bring additional pressure to colleges to slow the year-round worker over age 25
†Sources: U.S Census Bureau – Current Population Survey, 2008 Annual Social and
growth of education costs Economic Supplement
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7. The Human Capital Score™
• Initial focus was to fix FICO® which is broken for students/young adults
– Students generally receive low scores that do not reflect true credit risk
• The Human Capital Score™
– Proprietary risk measure developed by People Capital
– Built by leading labor economist and a team of researchers
– Based upon achievements (e.g. SAT, GPA) and choices (e.g. school,
major)
– http://www.slideshare.net/tomshelton/hcs-summary-validation-faqs
• Built core technology for use as API and web services
– Generates 10-year income projections of young adults. Mean and range
of earnings post graduation, trajectory of growth, ability to pay
– Can provide robust output based on 2-5 variables
• HCS impact and progress
– Helped raise equity capital and driver of loan operations business
– Key factor in deal with ATM/Cardtronics for their credit union clients
– Beta tested by credit risk depts. at Discover, Citibank, etc.
– Closed deal with leading personal finance site (but not launched)
– Strong interest and due diligence by top 5 news company for partnership
– Used by the National Institute of Certified College Planners (NICCP)
• Consumer-focused calculator launched
– Scenario Analysis/College Planning Tool launched
– R&D: law school, business school, grad, associate degrees, etc.
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8. Why is this important?
WORK & FAMILY
“HumanCapitalScore.com's projections can also help a student figure out how much
money to borrow for college. Many experts say total student loans shouldn't
exceed a grad's first-year income after graduation.”
http://online.wsj.com/article/SB10001424052748703438404574597952027438622.html
http://www.slideshare.net/tomshelton/assessing-the-value-of-a-college-degree-wsj
• Unique source of post-graduation income potential
• Leads to an informed conversation …
– What is the student’s potential income post graduation?
– How much should he/she be comfortable borrowing?
– What is his/her ability to pay back over time?
– What is the impact on the choice of college or major?
• Can change behavior of all players in higher education industry
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9. Experiences and Lessons Learnt
• People Capital lending business was top priority
– Could not take advantage of HCS opportunities nor build proper consumer solutions
– Focused on the credit risk departments rather than consumer marketing companies.
• Primary goal was to tie HCS to credit risk and institutional lenders
– Toughest and longest sales cycles
– Still valuable to attach credit risk defaults to HCS, but that is complicated and extended
business model
• Opportunity to provide unique college planning tools to the consumer market
– Built a college analysis tool but UX/UI was poor, no investment in lead gen
– Initial successes will be with personal finance sites, leading news sites, college and career
planning.
– A slimmer and more agile organization focused on HCS
– Unique tools driving revenue share partnerships
– Freemium
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10. Partners & Competition
College Planning
HCS
Personal Finance HR & Data
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11. Product Roadmap
Medium Term
Opportunities
Partnership Opportunities •Expand product to include non-
•Close deals with third-parties to traditional education & training,
provide our products to their end- i.e. Khan Academy, Udacity,
Build a Consumer offering community college, etc.
users
• Develop consumer-focused •Institutional clients and lenders •Build referral network
offering license HCS (like a credit bureau •Create and sell data services
• Improved UX/UI pull) •Enhance the credit risk
• Build Recommendations •Acquire additional data sets algorithm for the lender market.
Engine, providing more •License third-party
dynamic college planning •Crowdsource
experience.
• Social networking apps
• Create Widgets to be deployed
into partner sites for revenue
share.
• Improve API to drive
partnership integrations
• Update model with current data
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12. Additional Info - Current HCS
• Sample report:
– http://www.slideshare.net/tomshelton/hcs-college-planningtool
• HCS Validation & FAQs:
– http://www.slideshare.net/tomshelton/hcs-summary-validation-faqs
• API:
– http://www.slideshare.net/tomshelton/human-capital-score-api-for-lenders-v202
• Videos:
– HCS Simple Results Demo
• http://www.slideshare.net/tomshelton/people-capitalp2phcsdemoflashvid
– HCS Long Demo
• http://www.slideshare.net/tomshelton/people-capitalhcs-demo4min
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13. For more information
• Thomas Shelton
– Founder & CEO, People Capital
– tom.shelton1999@gmail.com
– (917) 693-1019
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