Emerging Technology Advisory Group

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EMERGING TECHNOLOGY ADVISORY GROUP YOUR PARTNER FOR ENTREPRENEURIAL GROWTH

Cushman & Wakefield’s Emerging Technology Advisory Group brings together exceptional advisors from entrepreneurial clusters across FROM EMERGING TECH TO PUBLICLY TRADED

the globe to serve the dynamic needs of technology companies from early stage to mature. Our integrated, global team is uniquely situated to offer emerging industries a true partnership and a full suite of bespoke services as they evolve.

Our team at C&W will work tirelessly for an opportunity to earn your trust and partnership.

2 | EDUCATION ADVISORY GROUP 2 | EMERGING TECHNOLOGY ADVISORY GROUP

YOUR GLOBAL PARTNER As a large global firm with more the 51,000 employees in 70 countries, we offer a full suite of services, vast international connectivity and expertise. As an Emerging Tech-focused practice, we share the creative and entrepreneurial spirit of our clients, and in doing so develop unique and nimble solutions for our clients’ real estate portfolios.

CUSHMAN & WAKEFIELD | 3

WE HELP YOU SCALE WITH A BESPOKE MENU OF SERVICES. 2 We are with you every step of the way. Whether its securing your first coworking space for 10 employees or expanding regionally or nationally into talent hot spots, we will help you meet your unique financial and operational goals. 1-10 Employees 10-100 Employees COWORKING / SHARED FIRST OFFICE

500-3K SF Space

3K-20K SF Space

Challenges • Distraction • Security • Cost

Challenges

• Timing the scale • Higher rent obligation vs. funding/revenue

Cushman & Wakefield Services Solution

• Brokerage Advisory • Lease Review & Negotiation • Financial Decision Analysis & Support Cushman & Wakefield Services Solution

• Coworking Evaluation & Placement • Brokerage Advisory

HEADQUARTERS

NATIONAL/INTERNATIONAL

100-500 Employees

500+ Employees

20K-100K SF Space

100K+ SF Space

Challenges • Lease Term • Scalability

Challenges

• Significant real estate expense • Lost start-up mentality • Synthesizing data across platforms

• Brokerage Advisory • Lease Review & Negotiation • Financial Decision Analysis & Support • Business Incentives Negotiation • Labor Analytics & Business Consulting • Project & Development Services • Global Market Intelligence • Vendor Assessment & Selection • Portfolio and Lease Administration • Change Management Consulting Cushman & Wakefield Services Solution

4 | EMERGING TECHNOLOGY ADVISORY GROUP

SERVICES SPOTLIGHT

GLOBAL SITE SELECTION & LOCATION STRATEGY

Our Strategic Consulting practice offers a wide range of services, from helping you identify strong talent markets to designing a workplace that aligns with corporate culture. Our team also provides Change Management services, helping companies successfully adopt and communicate change in order to drive organizational success and outcomes.

LOCATION DRIVERS

Talent Markets with talent that align with growth needs, culture & cost

Taxes & Incentives Implications of state and local taxes & government incentives

Real Estate Availability & cost of suitable real estate

Implementation TI scope & timing, zoning & permitting, utilities

Logistics Proximity to key transit; parking & shuttle needs

Customers Access to customer & partner networks & industry clusters

Government Government regulations, currency stability

Risk Natural disaster, employee safety, IP protection

Cultural/Personal Cultural fit, housing, higher education, COL

As you grow, we respond.

CUSHMAN & WAKEFIELD | 5

SERVICES SPOTLIGHT

PORTFOLIO ADMINISTRATION

Our Portfolio Administration team will abstract your lease documents and service agreements into a robust technology platform that provides Critical Date notification as well as financial reporting capabilities to ensure bills are paid on time for the correct amounts. Through this service you will have complete transparency into your real estate portfolio data and be able to efficiently locate legal documents and English-abstractions of critical lease terms.

CUSHMAN & WAKEFIELD PORTFOLIO ADMINISTRATION BY THE NUMBERS 66 Languages 1.4B SF Managed $10M Client Savings / Year 350 Global Resources 28 Platforms

Lease Data Management • Primary Database Maintenance • Lease Term Abstraction • Critical Dates Monitoring

Financial Management • Landlord Invoice Review • Rent Escalations Confirmation • Database Maintenance • Monthly Payee Reporting

Lease Accounting • Client-Managed Lease Accounting Module • Data Gap Analysis • Customized Ledger Accounts

6 | EMERGING TECHNOLOGY ADVISORY GROUP

SERVICES SPOTLIGHT

PROJECT & DEVELOPMENT SERVICES

Our Project Development Services (PDS) team ensures your construction projects are completed on-schedule and on-budget. With field professionals around the world, we provide local oversight to landlord and tenant-led build outs. Our PDS practice offers incredible purchasing power to our clients that can be used to obtain preferred pricing on furniture, fixtures, equipment and building finish materials.

Project Management • Design Management • Project Planning & Budgeting • Procurement Management • Cost Consultancy

Design & Build • Project Management • Full Procurement Services • Construction Management • Development Management • Post Project Manual Management

Construction Management • Construction Scheduling • Procurement Management • Contract Administration • Construction Monitoring • Health Safety • Environment

Supplementary Services • Feasibility Study • Due Diligence • Sustainability • Workplace Strategy • Change Management • Relocation / Move Management

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Cushman & Wakefield offers award-winning technology solutions that are changing the way in which occupiers transact and manage their portfolios. TECH (FOR TECH)

SECURELY MONITOR GLOBAL LEASE ACTIVITY Consider our collaborative, customizable and secure online portal. It provides full transparency into global account activity and seamless access to account resources, playbooks and templates.

GROW WITHOUT PAINS As companies scale, they undoubtedly encounter many parallel workstreams. Our transactions portal keeps our integrated team informed 24/7 on project status and action items.

DIAGNOSE BEST MARKETS FOR ENTRY Our interactive and intuitive mapping platforms arm you with intelligence on labor trends, demographics, and customer/ vendor hot spots, provoking informed location decisions.

8 | EMERGING TECHNOLOGY ADVISORY GROUP

ENJOY EXECUTIVE- FRIENDLY REPORTING Integrated with our client’s technology, we provide interactive, executive-friendly reports that inform new portfolio opportunities and alert critical dates and potential red flags. Global teams can stay abreast of portfolio dynamics and monitor ongoing performance in real time.

IDENTIFY OPPORTUNITIES AT A GLANCE Integrated dashboard reporting allows our clients to synthesize data across traditionally disparate technology solutions. Visualizing portfolio intelligence allows our teams to spot opportunities and push proactive strategies.

BE HEARD Client satisfaction and ongoing improvement are paramount. Our web-based client surveys provide real-time feedback to project teams managing the partnership.

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THOUGHT LEADERSHIP & INDUSTRY INTELLIGENCE View a complete list at cushwaketech.com or click on individual thumbnails below.

MARKET TRENDS & OVERVIEW CommonLocalMarketPractice

OVERVIEW OF MARKET NORMS AND TRENDS – COMMON LOCAL PRACTICES There are several key concepts causing curiosity among today’s tenants. This is a Montreal-based example of today’s Market Norms and Trends. Cushman & Wakefield can provide similar perspectives on any global market your team is interested in.

LeaseTerm

InQuebec,mostoffice lease terms fornew transactionsor renewals range from3 to 10 years,with the most common term commitmentbeing5 years.Considering thatMontreal is currently exhibiting a Tenant’smarket& thatACMECompanyhashigh standards for their leasehold improvements, a longer term (such as 10 years)wouldundoubtedlyuncoveropportunities such asnew constructions,build-to- suitprojects aswell as conversionof industrialbuildings, allwhile keeping the costs relatively low.A longer term also increasesnegotiating leverage tobuild inflexibility into the lease agreement including the rights to expand& contract the space, rightsoffirst refusal, terminationoptions alongwith rights to assign and\or sublease and soon.

RentStructure

A commonpractice in themarket,when considering either institutionallyorprivatelyownedoffice buildings, is tohave leases that arenet-net to the landlord.Thismeans theparties establish a minimum rent (NetRent) and theTenant shallpay all costs and expenses relating to theoperation and maintenanceof thebuilding, the leasedpremises and/or thebusiness carriedonby theTenant (known as “AdditionalRent”).Landlords remain responsible for all structural elementsof thebuilding.

RentEscalations

NETRENT The escalationsof theNetRent shallbenegotiated and agreeduponbybothparties in theLease.For long-term leases, there aregenerallypredeterminedNetRent increases, i.e.$15.00Net (years 1-5)&

$16.00 (years6-10) ADDITIONALRENT

Tenantsgenerallypay theirproportionate shareof thePropertyTaxes&BuildingOperatingExpenses according to theLandlords’ auditedfinancial statements.On average, theAdditionalRent increases by 2 to3percent annually.Some landlords accept for a cap tobe imposedon such augmentations, limiting thebuildingoperational expense increases to amaxoutpercentage (generally3-4%).

SecurityDeposits

A commonpracticeofLandlords is to require aminimumdepositorprepaid rent equivalent to thefirst and lastmonths’NetRent andAdditionalRentplus taxesormoredependingon the solvencyof the Tenant. In the caseof some large and reputableorganizations likeACMECompany,however,wehave been successful inhaving suchdeposits excluded from lease agreements.

AUTHOR: ErikLangburt SeniorVicePresident, InvestmentSales&Leasing +1514841-3818 erik.langburt@cushwake.com

cushwaketech.com cushmanwakefield.com

AnEmergingTechnologyAdvisoryGroupPublication

CRE TECH FOR DESK ALLOCATION, HOTELING & MEETING ROOM BOOKING This overview of several innovative CRE technologies is appropriate for occupiers of flexible workplace solutions and a mobile workforce. Now you can identify the right technology solutions for managing hot desking and conference room booking.

CRE TECH FOR DESK ALLOCATION, HOTELING & MEETING ROOM BOOKING Anoverviewof the latestSaaS solutionswhichhelp clients allocate,&monitor, desk allocations (permanent andhoteling)&meeting roombooking

SUZANNEMEHTA Building aVision for EmployeeEngagement suzanne.mehta@cushwake.com

Suzanne leads thedesign andoperationalizationof the firm’sEmployeeExperienceProgram.Theprogramhelps ouroccupier clients establish a vision and strategy for enhancinguser experience and servicequalitydelivery in supportof employee engagement, retention, and productivity.

Robin

Condeco

Teem

Essensys

• Robin software allows clients to schedule rooms and deskswith integration across Google&Outlook calendars whileprovided real-time officemaps andworkplace analytics. • Robin integrateswithdigital meeting room signage via tablets and televisions and is scalable across enterprise- gradedeployments

• Condecohelps clients managemeeting rooms, visitors,hospitality, services and video conferences acrossmultiple locations and time zones. • CondecoDigitialConference Room allowsuses to instantly start a conference, scheduleor release a room usingPINorRFID • Screensgather real-time information abouthow conference rooms are reserved andused andhave auto-bumps forno shows.

• Teemprovides space scheduling&management, visitormanagement,building wayfinding andworkplace analytics. • Book conference roomsor desks through amobile app, digital tabletdisplayor voice activation • Integrationwith real-time occupancy sensors to supportworkplace analytics

• Software tailored for the coworking/flexibleoffice industry, includes features specific to aflexibleoffice manager such asmove scheduler,WiFimanager/ stats, and supporthub. • The software’sSpace Publisher feature allows users topublishmeetings rooms toonlinedata aggregators and a space management tool to reserve and allocatedesks and roomson thefly

SEANBUCKLEY Understanding& Implementing TechSolutions sean.buckley@cushwake.com

AtCushman&WakefieldSean advises clientson the Space&Workplace technologymarket landscape and trends.Newproducts are analyzed and scored so that differentiators canbe clearly communicated to interested clients.The levelof engagement variesper clientbut can range from a simplephone call to confirm a client ison the right track in theirown search to a full technology software selectionproject.

SaaS Solutions:

ELISAKONIK ManagingDirector,Brokerage &StrategicServices Chair,EmergingTech AdvisoryGroup elisa.konik@cushwake.com

ElisaKonik leadsC&W’sEmergingTechnologypractice group, advising startups andhighgrowth technology occupierson theirglobal real estate strategy. With a broadnetwork across theglobe,C&W’sEmergingTech teamhas exceptional experienceworkingwith innovative tenants tofind,negotiate andbuild cutting edge workplaces.

cushwaketech.com cushmanwakefield.com AnEmergingTechnologyAdvisoryGroup&TenantAdvisoryGroupPublication

Copyright© 2019Cushman&Wakefield.All rights reserved.Nowarrantyor representation, expressor implied, ismade to the accuracyor completenessof the information about the services containedherein, asCushman&Wakefielddoesnotown these services.

FLEXIBLE

DIRECT LEASE

FLEXIBLE WORKPLACE TO DIRECT LEASE ANALYSIS With our partnership you can formally evaluate a transition from a coworking or serviced office to a direct lease. This framework helps to qualify the quantitative and qualitative impact of long term traditional leases to help you identify the right inflection point for your portfolio’s growth.

MarketProfile:HongKong,HK Theaccompanyinganalysisprovides anestimatedeconomic and qualitative comparativebetween ourexistingFlexible Workplaceagreement (ManagedorServicedoffice)and a traditionalDirectOfficeLease. Adirect leasealternativewas chosen (10minwalk from currentoffice) for representative pricing;however all termsare subject tonegotiationandare estimates innature.

ExistingOfficeObligation Address

AddressXXX,XXFloor

Provider /Landlord

WeWork

LeaseExpiry

8/31/20

RSF

1,000

TheWorkplace Team recommends evaluating Direct Lease alternatives in the range of 4K SF for a 3-5 year term commencing Sept 2020, in linewithour current expiration.

Desks

CurrentMonthlyOffice ServiceFees$USD

$XXX

Headcount –Current andFuture GrowthProjections:

2019 2020 2021 2022

36Employees 40Employees 44Employees 38Employees

18Desks 20Desks 22Desks 24Desks

2023

53Employees

27Desks

Note:36employees inmarket todayat ratioof2Employees:Desk anda10%perannumgrowth rate.

10 | EMERGING TECHNOLOGY ADVISORY GROUP

We put industry-leading tools with real-life application in the hands of our emerging tech clients.

LEASE SECURITIZATION FOR A “START-UP” Technology companiesoftenexperience rapidgrowth through investmentbutmay nothave the longstandingbalance sheet a landlord is accustomed tounderwriting with aFortune500 company. How to securitize a lease is especially importantwhen the landlord is spending tensof thousands, ifnothundredsof thousands,ofdollars tobuild your company’snewdream space.As a result, landlords expect somefinancialprotections from the tenant as security.Securitization can come in severaldifferent forms, including a cash securitydeposit, a letter of credit, and apersonalguaranty.

What’sNew inLease Securitization?

LEASE SECURITIZATION FOR A “START-UP” Technology companies often experience rapid growth through investment but may not have the long-standing balance sheet a landlord is accustomed to underwriting with a Fortune 500 company. This will guide you through your Security Deposit options.

WHAT ISSECURITI? A suretybondused tomeet security deposit requirements in a commercial lease, replacing theneed for cashor a letterof credit.Securiti acts like amore traditional insurance vehicle for tenants,but functions like a letterof credit forLandlords.

CashSecurityDeposit This is themost common formof securitization in a lease.A ‘best-case’ securitydeposit is typically equal toone monthof rent and ispaidupfront atLeaseExecution.The landlordholds the securitydeposit throughout the lease term and returns itback to the tenant shortly after expiration,provided the tenant adheres to itsobligations in the lease.The sizeof the securitydepositmay increasedependingon the amountofmoney a landlord invests onTenant Improvements and a tenant’sown creditworthiness. In some cases, a landlordwill ask forup to6 to 12 monthsof rent (ormore) as a securitydeposit.This is challenging for any company, especially a startup,whomay be strapped for cash. For larger securitydeposits,bothCash andother formatsnotedbelow, aBurnDownmaybenegotiatedwhich allows thedeposit amount tobe reducedover time.Provided you remain ingood standing, and arenot in lease default,BurnDownsmaybenegotiated againstmilestones such as:TimeElapsed,ClosingofFutureFunding Rounds,Profitabilityorothermeasures. LetterofCredit Provided theLandlord is amendable, some companiesmayopt to secure aLetterofCredit (LOC), in lieuof cash. In some instances, aLandlordmay require aLetterofCredit. Typically, aLetterofCredit isbest secured from thebankwhere the companydoes themajorityof itsbankingbusiness.AnLOC is typically cash collateralized, meaning that the companywillnotbe able to access the equivalent cash fundswhile theLOC is active.With anLOC, the tenant typicallypays thebank a fee, fees varybybank. While this can varyby legal jurisdiction, an LOCmaybeperceived asprovidingbetterbankruptcyprotection to a landlordbecause a cash securitydeposit is typically consideredpropertyof thedebtor’sbankruptcy estate andmaybe subject toother claimsmade against the estate.

HOWDOES ITWORK?

Pay aSmallAnnualPremium Rates aredeterminedby the resultsof Securiti’sunderwriting

ReplacesYourSecurityDeposit Your landlord is issued a suretybond backedbyChubb Insurance andother A-rated carriers KeepYourCash

Spend yourmoney theway youwant

POTENTIALADVANTAGES Securiti allows you to keep your cash&maximize operationalflexibility • No collateral required • Offbalance sheetfinancingwithno impacton leveragemetrics • No impacton credit capacity so yourbusiness canborrow asneeded

PersonalGuaranty APersonalGuaranty is amoreuncommon solution though itmay come intoplay for early stagebusinesses. Essentially, theownerof a companyputsup theirpersonal assets as collateral should therebe a leasedefault. This is typically a ‘PlanC’option, andnot adesirableposition ifother security vehicles canbe achieved. If signing aPersonalGuaranty,negotiating aBurnDown schedulewillbe especially important.

cushwaketech.com cushmanwakefield.com AnEmergingTechnologyAdvisoryGroup&TenantAdvisoryGroupPublication

Real Estate Business Case

Market

ProjectType

Oakland, CA

REAL ESTATE BUSINESS CASE Gaining consensus and approvals for multi- year projects can be a challenge for rapidly growing businesses. Our intuitive Business Case Approval forms illustrate the thoughtful process we undertake on behalf of clients from inception to execution, providing transparency into local trends and comps, labor markets and financial impacts that speak to executives.

NewLease

Purchase

Renewal

Sublease

ProjectDrivers (HighlightAllThatApply)

MarketExpansion

ExitorDownsizing

NewMarket

Consolidation

KeyObjectives (SelectTopThree)

ReduceOperatingCosts inMarket UpgradeWorkplaceCulture SupportBusinessUnitGrowth ImproveOperationalEfficiencies

AttractandRetainTopTalent

✔

ReduceUnderutilized/SurplusSpace CreateLongTermStability inMarket

✔

OfficeProximitytoCustomers

✔

Notes/Other: TextGoesHere

HeadCountForecasting&SpacePlanning

DesignStandards: X RSF PerEmployee Est.RSFNeed: X to X RSF

50 2018

50 2019

50 2020

50 2021

50 2022

50 Beyond

Notes: TextGoesHere

ExistingObligations AcrossMetroArea Address

Lease Expiry 1/1/18 0/0/00

RSF

Head Count

Seat Count

CurrentAnnual BaseRent

55512 th Street,Oakland,CA 12345Street,City,State

10,000

30 00 00

20 00 00

$1.1M

00 00

12345Street,City,State

0/0/00

Whileeachmarket anddeal isunique,most commercial realestate leases fall intoone of the formatsnotedbelow. It is critical to understandhow your rent is structured to avoid hidden feeswhenbudgeting for your total annual realestateobligation.

OPERATING EXPENSES: What’s Included inYour BaseRent?

TypicalRentStructures

OPERATING EXPENSES: WHAT’S INCLUDED IN YOUR BASE RENT? While each market is unique, most commercial real estate leases fall into one of four typical rent structures. It is critical to understand how your rent is structured to avoid hidden fees when budgeting for your total annual real estate obligation.

FullServiceGross

IndustrialGross

ModifiedGross

TripleNet

Most common structure forU.S.office leases.Base rent includes tax, insurance, utilities, in-suite janitorial,

Base rent excludesutilities and in-suite janitorial. While this variesby market,$0.40/SFper month is a reasonable estimate to convert IG leases to aFSG equivalent.

Structure can varybut typically excludesutilities, in-suite janitorial, andCAM.

Base rentonly; tenant responsible for tax, insurance,utilities, in-suite janitorial, andCAM.

andCommonArea Maintenance (CAM).

Internet/Phone and related cabling are typically a tenantexpense andexcluded in rent structures,with the exceptionofmost co-working facilities andexecutive suites.

OperatingExpenses&BaseYearExplained FullServiceLease

BaseYear: • Established infirst yearofoccupancy • No additionalOperatingExpense (OpEx)/ additionalRentdue

Example: Tenant is responsible for costdelta from current yearoverBaseYear. TotalBuildingOpEx inBase Year $1M

YEAR 1

TotalBuildingOpEx in CurrentYear

$1.1M

YearTwo: • Tenant assumespro-rata shareof totalbuilding OpEx increaseoverBaseYear • Ownerprotected from excessive annualOpEx increases • No additionalOpEx rentdue in the eventof second yearOpEx reduction

YEAR 2

Delta fromCurrentYearover BaseYear

$100K

YourPro-rataShareofBuilding OpEx (PremisesSF/BuildingRSF)

3.55%

YourAdditionalRent inCurrent Year:$3,550 annuallyor$296/mo

$3,550

AnnualBaseRentEscalation

Your rentwill likelyescalateeach year. How itescalates shouldbenegotiated and then specified in your lease.

3% InmanyU.S.markets, office rents increaseby

per yearor are CPI-based.

cushwaketech.com AnEmergingTechnologyAdvisoryGroupPublication

CUSHMAN & WAKEFIELD | 11

About Cushman & Wakefield Cushman & Wakefield (NYSE: CWK) is a leading global real estate services firm that delivers exceptional value for real estate occupiers and owners. Cushman & Wakefield is among the largest real estate services firms with approximately 51,000 employees in 400 offices and 70 countries. In 2018, the firm had revenue of $8.2 billion across core services of property, facilities and project management, leasing, capital markets, valuation and other services. To learn more, visit www.cushmanwakefield.com or follow @CushWake on Twitter.

Elisa Konik Chair Emerging Technology Advisory Group +1 510 891 5851 elisa.konik@cushwake.com

cushmanwakefield.com

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