10 01 05 Web 2.0 Weekly Special Edition

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Slide 1: 5 January 2010 Web 2.0 Weekly – SPECIAL EDITION David Shore, CFA, MBA 416.860.6784 david.shore@researchcapital.com Damian Wojcichowsky, Associate 416.860.7652 2009 Review: A Strong Year for Web 2.0 damian.wojcichowsky@researchcapital.com SOFTWARE AND MEDIA Slide 2: Page 2 TOP FIVE DEALS OF 2009 The Top Five: Despite over 400 transactions in 2009, it wasn’t hard choosing our Top Five transactions for 2009 (with a little bit of massaging). Our Top Five transactions are: Facebook’s $200 million D round, Twitter’s $100 million E round, the $2.25 billion acquisition of Skype, the almost $1 billion in financing/M&A for Social Gaming companies (including Zynga, Playdom and Playfish), and the incredible per unique visitor value ascribed in the financing for location-based social networking company Gowalla. • Facebook raises $200 million D round: In May 2009, Facebook announced a new financing round – raising $200 million from Digital Sky Technologies. The transaction gave Digital Sky a 1.96% stake, valuing Facebook at $10 billion. This financing brought the company’s total to $678.2 million. This was also the largest financing we recorded in 2009. Twitter raises $100 million E round: The third largest financing round in 2009 belonged to Twitter – a $100 million Series E in September 2009. The financing reportedly valued Twitter at $1 billion – a remarkable valuation for a company that has not yet formalized a revenue model! More recently, it has been reported that Twitter was actually profitable in 2009 due to the $25 million in search deals it signed in October with Google and Microsoft. Skype is acquired for $2.025 billion: By far the largest overall transaction in our database in 2009 was the acquisition of a majority position (65%) in Skype from eBay for $2.025 billion – announced in September 2009. The transaction was completed in November 2009. eBay had purchased Skype for $4.0 billion in 2005. Social Gaming financing activity reaches ~$1 billion (Zynga, Playfish, Playdom, etc.): Perhaps the hottest sector overall in 2009 was Social Gaming. This segment of the W eb 2.0 market had the third highest number of deals (39) and generated almost $1 billion in financing/M&A activity – the second highest total overall (Figure 1). Three transactions in particular stand out in the social gaming space – the $400 million acquisition of Playfish (by Electronic Arts, November 2009), the $180 million financing of Zynga (Series C, December 2009, by Digital Sky), and the $43 million first round of financing for Playdom (New Enterprise lead, November 2009, Series A). There has been much speculation as to how the larger social gaming companies will proceed, with potential IPO or further strategic M&A most likely. • • • F inancing/M&A (2009) B y S ector/Type 2, 500 2, 000 S eries E 1, 500 (US $ mm) S eries D S eries C S eries B S eries A P IP E Debt financing Angel/S eed Acquis ition 1, 000 500 0 C rowds ourced C ontent Mobile P a yment Mobile A d Microblog Online L earning Online Dating T ravel B log Advertis ing C ollaboration Aggregation P ublis hing C las s ified S earch Internet R etail V ideo G aming W idget C omment/R eputation Advertis ing/Mobile S ocial C ommerce V ertical C ommunities F inancial S ervices V is ual C ommerce Location-bas ed S NS Online C alendar S MS /V oice Mobile V irtual W orld Mus ic Infras tructure E nterpris e Media W iki S ocial Networks V irtual G oods Micromedia Analytics Documents RSS S AS Figure 1. Capital Market Activity, 2009, By Sector Source. Company reports Slide 3: Page 3 • Hottest new sector? Location-based social networks (Foursquare, Gow alla, etc.). Unique visitor value skyrockets: Financing activity for location-based social networks really heated up late in 2009. W hile the total financing raised in 2009 was quite small (~$15 million), the hype surrounding location-based SNS companies was substantial. In our opinion, this was highlighted by the $8.4 million December Series B financing for Gowalla. The reported valuation of $28.4 million implies a value of $568 for each of its 50,000 users (Figure 2). That compares to a $40 per user value we estimate for the Foursquare financing in September. E s timated Value per Unique Vis itor S ourc e : C ompany re ports , C ompe te . com $600 $568 $500 $400 ($) $300 $200 $200 $113 $100 $88 $48 $42 $40 $32 $29 $29 $25 $22 $20 $19 $19 $16 P ageO nce $7 P la yfis h $6 Zynga $5 S tumbleU pon $2 F riends R eunited Aug-09 $Y elp Y elp C lub P enguin P eople Media MMC (P oynt) Dec-09 F riendF eed Mint.com P laxo T witter Linkedin F ours quare G owa lla F acebook T witter B ebo Mar-08 Dec-09 May-08 S ep-09 O ct-08 A ug-09 S ep-09 S ep-09 May-09 Aug-07 F eb-09 F eb-08 J ul-09 Dec-09 Dec-09 N ov-09 Dec-09 May-09 Figure 2. Unique Visitor Value Source. Company reports, RCC estimates, Compete.com Slide 4: Page 4 2009 FINANCING REVIEW December – the year ends on a high note: Total transaction value in the W eb 2.0 universe for December is $449.4 million (Figure 3). The number of financings stands at 34, averaging $13.2 million each. In comparison, total capital raised in November was $204.4 million, averaging $10.8 million (19 deals); October was $176.1 million, averaging $5.9 million (30 deals); and September was $232.8 million, averaging $9.0 million (26 deals). Financing Activity Last Twelve Months 500.0 16.0 450.0 14.2 13.2 14.0 400.0 12.0 350.0 10.8 10.0 300.0 (US$m) 9.0 (US$m) 250.0 7.0 6.4 200.0 6.9 6.5 6.2 5.6 4.7 150.0 7.4 8.0 5.9 6.0 4.0 100.0 2.0 50.0 0.0 Dec-08 Jan-09 Feb-09 Mar-09 Apr-09 May-09 Jun-09 Total Jul-09 Average Aug-09 Sep-09 Oct-09 Nov-09 Dec-09 0.0 May-09 includes $200m FB investment Dec-09 includes $180m Zynga investment Figure 3. Financings, Last Twelve Months Source. Company reports Slide 5: Page 5 September was biggest month: September was the biggest month for capital market activity, driven by the acquisition of Skype for $2.025 billion (Figure 4). After a slow October, financing/M&A activity picked up in the last two months of the year, with December being the largest month for financing (excluding M&A). Total C apital Market Activity - L as t Twelve Months 3, 000 2, 500 2, 000 1, 500 1, 000 S eries E S eries D S eries C S eries B S eries A P IP E Debt fina ncing Angel/S eed Acquis ition 500 Dec-08 J an-09 F eb-09 Ma r-09 Apr-09 Ma y-09 J un-09 J ul-09 Aug-09 S ep-09 O ct-09 Nov-09 Dec-09 Figure 4. Capital Market Activity, by Sector, Last Twelve Months Source. Company reports $10 billion cumulative: W ith $2.8 billion in financing in 2009, total financing for our W eb 2.0 universe is now $9.7 billion (Figure 5). The $2.8 billion raised in 2009 was down 17.2% from the $3.4 billion raised in 2008. Web 2.0 F inanc ing (c umulative) 1,600.0 1, 431. 6 1,400.0 10, 000.0 1,200.0 1, 067.3 8,000. 0 1,000.0 (US $m) 950.4 (US $m) 830.0 800. 0 623.0 600. 0 492. 4 426. 3 400. 0 338. 7 262. 9 240. 5 200. 0 41. 5 24. 7 Q 1 Q2 Q 3 Q 4 Q 1 Q 2 Q 3 Q4 Q 1 Q 2 Q 3 Q 4 Q 1 Q 2 Q3 Q 4 Q1 Q 2 Q 3 Q 4 Q 1 Q 2 Q 3 Q 4 2004 2005 2006 2007 2008 2009 182. 1 173.5 163.8 112. 8 59. 4 40.1 59. 7 43.3 95. 9 2,000. 0 4,000. 0 713.7 662. 0 658. 0 6,000. 0 12, 000.0 Figure 5. Web 2.0 Financing, by Quarter, Cumulative Source. Company reports Slide 6: Page 6 Smaller deal sizes: Deal size averages fell below long-term historical levels in 2009, with Series A-D rounds all below long-term average levels (Figure 6). However, angel rounds were significantly larger than historical levels, averaging $3.0 million in 2009, above the $2.6 million long-term average. Average financing round size 30.0 28.4 28.5 28.5 25.0 22.4 24.2 20.0 (US$m) 15.0 14.9 12.9 10.2 10.0 7.6 6.5 5.0 3.0 2.6 2.9 6.3 4.4 6.2 0.0 Angel/Seed Debt financing PIPE Series A LTM Average Size Series B Overall Average Series C Series D Series E Figure 6. Average Financing Round Size, LTM and Overall Average Source. Company reports Early rounds dominate: As Figures 7 and 8 show, early rounds (Angel/Series A) dominate our financing landscape, in terms of number of deals with almost 50% of deals. Series C rounds raised the most overall (25.8% of dollars raised), just ahead of Series B (25.2%). F inanc ing by Type - 2009 (# deals ) S eries C 15.6% S eries D 18. 6% S eries D 6. 0% Angel/S eed 7. 2% Debt financing 0. 9% P IP E 1. 4% F inanc ing by Type - 2009 (amount rais ed) S eries E 5.0% S eries E 1. 4% S eries B 26. 2% S eries A 15. 8% Angel/S eed 18. 6% S eries C 25. 6% Debt fina ncing 2. 5% S eries A 28.1% P IP E 1.6% S eries B 25. 5% Figures 7 & 8. Capital Market Activity, by Type, Last Twelve Months Source. Company reports Slide 7: Page 7 Q4 largest for financing: Figures 9 and 10 show the financing activity by month and quarter for 2009, broken out by earlystage (Angel/Series A), mid-stage (Series B&C), and late-stage (Series D, E, and PIPEs). Q4 was the largest quarter in terms of amount raised, but the second lowest quarter for number of deals. Financing by Type - 2009 (Amount raised) 900.0 828.0 800.0 131.0 700.0 653.2 657.3 660.0 600.0 94.2 222.3 227.3 Late Stage (D/E) 449.4 532.3 76.5 390.3 321.7 Mid-Stage (B/C) Early Stage (Angel/A) Total 500.0 (US$m) 400.0 300.0 281.8 19.0 193.7 187.1 48.2 205.0 177.7 27.0 103.3 146.0 12.0 168.7 68.6 65.4 Q1/09 67.6 49.1 79.1 189.6 5.3 105.2 241.4 301.1 206.9 31.0 99.8 193.6 76.1 Q2/09 Jul-09 121.2 80.2 38.1 17.5 Q3/09 131.7 49.3 54.9 60.5 Q4/09 222.4 63.2 133.1 230.8 203.4 175.1 2.0 123.8 52.5 312.4 200.0 100.0 75.7 - 100.0 96.0 164.7 45.6 47.4 Jan-09 Feb-09 Mar-09 Apr-09 May-09 Jun-09 Aug-09 Sep-09 Oct-09 Nov-09 Dec-09 Figure 9. Capital Market Activity, by Type, Last Twelve Months, Amount Source. Company reports Financing by Type - 2009 (Number of Deals) 100 91 90 86 5 80 9 81 6 70 67 7 35 42 37 Late Stage (D/E) Mid-Stage (B/C) Early Stage (Angel/A) Total 40 1 60 (#) 50 40 39 37 3 34 30 13 2 24 15 4 40 29 1 12 3 30 28 2 21 24 2 8 10 11 21 14 7 7 7 Q1/09 10 18 19 2 9 3 22 2 17 46 16 18 2 38 20 10 22 14 21 13 6 Q2/09 Jul-09 Aug-09 Sep-09 Q3/09 Oct-09 16 9 15 7 Nov-09 Dec-09 Q4/09 Jan-09 Feb-09 Mar-09 Apr-09 May-09 Jun-09 Figure 10. Capital Market Activity, by Type, Last Twelve Months, # of Deals Source. Company reports Slide 8: Page 8 U.S. dominates financing landscape: Figures 11 and 12 show the financing/M&A activity by country (based on company HQ). The U.S. had the most deals – over 75% of the total (by number of deals). Financing/M&A by Country - 2009 ($) UK 7.8% China 4.4% Israel 4.1% Financing/M&A by Country - LTM (#) Canada 4.6% Canada 2.0% Luxembourg 31.2% UK 4.1% China 3.6% Israel 2.9% France 1.3% ROW 2.4% USA 76.2% ROW 8.5% USA 46.7% Figures 11 & 12. Capital Market Activity, by Geography, Last Twelve Months Source. Company reports TOP 10 LISTS Top 10 funded companies: Facebook tops the financing list for 2009, having raised $200 million (Figure 13). Zynga, with its $180 million round late in the year, came in second ($195 million total), followed by Twitter which raised $135.7 million. No other company raised more than $100 million in 2009. Top 10 Funded Companies - 2009 250.0 200.0 150.0 (US$ mm) 100.0 Series E Series D Series C Series B Series A 50.0 0.0 Facebook Zynga Twitter RockYou Turbine Playdom Youku Zoosk Pandora Media ChaCha Figure 13. Top 10 Financed companies, 2009 Source. Company reports Slide 9: Page 9 Top 10 acquirers: As lead investor in the Skype acquisition, Silver Lake leads our Top 10 acquirers list for 2009 (Figure 14). Second was Electronic Arts with the $400 million (including earn-outs) acquisition of Playfish. One of the last deals announced in 2009 drove O2 to the #3 spot with its $207 million acquisition of JaJah. Top 10 Acquirers (2009) B y Amount Inves ted 2500 2000 1500 (US $ mm) 1000 500 0 Intuit K ongZhong Ma tch. com O2 S ha nda Intera ctive E ntertainment L td. Adknowledge Network S ilver L ake E lectronic Arts Hi-Media S . A. IT V B es s emer V enture P artners Figure 14. Top 10 Acquirers, 2009, Amount invested Source. Company reports Top 10 lead investors (# deals): Accel Partners was the most active lead investor in 2009, leading nine transactions (Figure 15). Benchmark Capital was second with seven lead investments, followed by Charles River Ventures with six. Four firms were lead on five transactions. Mos t Deals (2009) B y L ead Inves tor 10 9 8 7 6 5 4 3 2 1 0 Accel P artners B enchmark C harles R iver C apital V entures New E nterpris e As s ociates Dra per F is her J urvets on C ana an P a rtners Augus t C a pital S equoia C a pital F irs t R ound C apital Figure 15. Top 10 Lead Investors, # of Deals Source. Company reports Slide 10: Page 10 Top 10 lead investors (amount invested): W hen analyzing amount invested, Digital Sky Technologies was the largest lead investor in 2009, participating in $380 million of transactions (Figure 16). Insight Venture Partners was second ($100 million), followed closely by Benchmark Capital with $99.4 million. Top 10 Inves tors (2009) B y Amount Inves ted 400 350 300 250 (US $ mm) 200 380. 0 150 100 50 100.0 99. 4 91. 9 70.5 52. 5 C a naa n P artners 50.0 G ranite G lobal V entures 50.0 S oftba nk 49. 0 G reylock P artners 41.0 Morgentha ler V entures 41 AdLink Internet Media 0 B enchmark C a pita l New E nterpris e As s ociates 80 Shanghai Dacheng Network Ins ight V enture P a rtners Figure 16. Top 10 Lead Investors, Amount Invested Source. Company reports Top 10 acquisitions: The largest acquisition in 2009 was the $2.025 billion acquisition of Skype (Figure 17). In second place was the $400 million Playfish acquisition, followed by the $207 million JaJah acquisition. Top 10 Acquisitions - 2009 2500 2000 1500 (US$ mm) 1000 2025 500 400 207 0 Skype PlayFish Jajah Mint 170 80 People Media 50 Super Rewards 44 Ku6 42 Friends Reunited Figure 17. Top 10 Acquisitions, 2009 Source. Company reports Accel P artners Digita l S ky T echnologies Slide 11: Page 11 C A P I T A L M A R K E T S A C T I V I T Y (P R I C E P E R F O R M A N C E ) Web 2.0 index outpaces NASDAQ in 2009: Our W eb 2.0 index (market-cap weighted) essentially mirrored the performance of the NASDAQ composite index for the first three months of 2009. Since then, the index has diverged in a much stronger recovery relative to the NASDAQ index (Figure 18). Web 2.0 Index Price Performance 250 200 150 100 50 0 1/19/09 2/16/09 3/16/09 3/30/09 4/13/09 4/27/09 5/11/09 5/25/09 6/22/09 7/20/09 8/17/09 8/31/09 9/14/09 9/28/09 11/9/09 10/12/09 10/26/09 11/23/09 12/7/09 1/5/09 2/2/09 3/2/09 6/8/09 7/6/09 8/3/09 12/21/09 Index: Web 2.0 (Market Cap) Figure 18. Web 2.0 Price Performance Source. Capital IQ ^COMP - Share Pricing Slide 12: Page 12 Strong 2009 performance: Fifty-three companies in our universe had positive stock price performances in 2009 (Figure 19), while 27 companies showed negative or flat returns. The performance for the group was led by Fluid Music Canada, Inc. with a 400% return in 2009, followed by Chinese Gamer International with a 353% return. Twenty-five of the companies saw their stock prices at least double in 2009. The worst performance was by Beyond Commerce, Inc. dropping 98.4% in 2009. BroadW ebAsia Inc. also fell more than 90% (-90.9%). Fluid M usic Canada, Inc. Chinese Gamer Internatio nal NEOWIZ Games Co rpo ratio n Openwave Systems Inc. M ultiplied M edia Co rpo ratio n Tencent Ho ldings Ltd. VOIS, Inc. M OKO.mo bi Limited Fro gster Interactive P ictures A G Cyberplex Inc. iseemedia Inc. DigitalP o st Interactive, Inc. Gravity Co ., Ltd OA O RB C Info rmatio n Systems SK Co mmunicatio ns Co ., Ltd. GungHo Online Entertainment, Inc. Webzen Inc. Gamania Digital Entertainment Co ., Ltd. Tree.Co m, Inc. Shutterfly, Inc. A Q Interactive, Inc. Kingso ft Co . Ltd. P erfect Wo rld Co ., Ltd. Gree, Inc. M o dern Times Gro up M tg A B A ccelerize New M edia, Inc. Netease.co m Inc. CDC Co rp. Changyo u.co m Limited A cto z So ft Co ., Ltd. Shanda Interactive Entertainment Ltd. DXN Ho ldings B hd Uniserve Co mmunicatio ns Co rp. Extensio ns, Inc. NeuLio n Inco rpo rated ValueClick Inc. NetDrago n WebSo ft, Inc. M ixi, Inc. B igstring Co rp. Open Text Co rp. IA C/InterA ctiveCo rp. United Online Inc. Spark Netwo rks, Inc. So hu.co m Inc. YD Online Co rp. XING A G Giant Interactive Gro up, Inc. HanbitSo ft, Inc. P NI Digital M edia Inc. Quepasa Co rp. Eo lith Co . Ltd. B right Things plc SpectrumDNA , Inc. Geo Sentric Oyj Lingo M edia Co rpo ratio n DA DA SpA Jumbuck Entertainment Limited M yriad Gro up A G Ynk Ko rea Inc. A sknet A G M agnitude Info rmatio n Systems Inc. TheStreet.co m, Inc. So cialwise, Inc. GameOn Co Ltd. Lo o kSmart, Ltd. NeXplo re Co rpo ratio n SNA P Interactive, Inc. B etawave Co rpo ratio n The9 Limited GigaM edia Ltd. Ngi Gro up Inc. Wo rlds.co m Inc. DigitalTo wn, Inc. UOM O M edia, Inc No rthgate Techno lo gies Limited Wizzard So ftware Co rpo ratio n Do lphin Digital M edia, Inc. Co rnerWo rld Co rpo ratio n B ro adWebA sia Inc. B eyo nd Co mmerce, Inc. 2009 P rice P erformance 235.1 % 227.3% 221 .6% 200.0% 200.0% 1% 98.1 1 92.3% 1 84.6% 1 .3% 81 1 80.0% 1 79.5% 1 72.7% 1 55.8% 1% 53.1 1 50.3% 1% 45.1 1 43.7% 1 32.3% 1% 30.1 1 .6% 21 1 2.6% 1 1 03.4% 85.7% 82.6% 80.6% 65.9% 61 .6% 57.7% 57.1 % 50.0% 50.0% 42.6% 42.4% 40.3% 33.8% 29.7% 28.8% 28.6% 24.4% 1 7.6% 1 6.9% 1% 6.1 1 3.2% 1 .2% 1 1 0.4% 9.2% 5.3% 4.4% 4.0% 3.3% 0.0% 277.2% 353.5% 400.0% -5.0% -1 4.4% -20.5% -24.2% -25.3% -26.1 % -28.0% -30.7% -38.6% -40.0% -40.5% -44.0% -45.7% -47.9% -49.2% -50.5% -52.2% -55.0% -55.6% -58.0% -59.4% -64.2% -74.4% -88.0% -90.9% -98.4% -200.0% Figure 19. 2009 Price Performance Source. Capital IQ -100.0% 0.0% 100.0% 200.0% 300.0% 400.0% 500.0% Slide 13: (US $m) 10, 000 20, 000 30, 000 40, 000 50, 000 60, 000 70, 000 80, 000 90, 000 - Figure 20. Total Market Capitalization, Monthly Source. Capital IQ Market C apitalization VALUATION 2009 ends at record high: After bottoming in November 2008 at $28.8 billion, the combined market capitalization of the 80 public companies we track hit an all-time high at the end of 2009, reaching $77.4 billion (Figure 20). J an-05 F eb-05 Mar-05 Apr-05 May-05 J un-05 J ul-05 Aug-05 S ep-05 Oct-05 Nov-05 Dec-05 J an-06 F eb-06 Mar-06 Apr-06 May-06 J un-06 J ul-06 Aug-06 S ep-06 Oct-06 Nov-06 Dec-06 J an-07 F eb-07 Mar-07 Apr-07 May-07 J un-07 J ul-07 Aug-07 S ep-07 Oct-07 Nov-07 Dec-07 J an-08 F eb-08 Mar-08 Apr-08 May-08 J un-08 J ul-08 Aug-08 S ep-08 Oct-08 Nov-08 Dec-08 J an-09 F eb-09 Mar-09 Apr-09 May-09 J un-09 J ul-09 Aug-09 S ep-09 Oct-09 Nov-09 Dec-09 Page 13 Slide 14: Page 14 Tencent the gorilla: Tencent Holdings (SEHK:700), with a market cap of approximately US$39.5 billion, has driven a large portion of the gains over the last year (Figure 21), rising from a market cap of $9.8 billion in November 2008. The other big contributors have been CYOU (+$1.8 billion), TSE:3632 (+$2.8 billion), MTG.B (+$2.1 billion), NTES (+$2.5 billion), and SNDA (+$1.9 billion). Market C apitalization 90, 000 80, 000 70, 000 60, 000 50, 000 (U S $m) 40, 000 30, 000 20, 000 10, 000 May-05 May-06 May-07 May-08 May-09 Nov-05 Nov-06 Nov-07 Nov-08 S ep-05 S ep-06 S ep-07 S ep-08 S ep-09 Nov-09 J ul-05 J ul-06 J ul-07 J ul-08 J an-05 J an-06 J an-07 J an-08 Mar-08 J an-09 Mar-09 Mar-05 Mar-06 Mar-07 J ul-09 AC L Z 3838 BS GC B Y OC BWBA C Y OU CWR L C M: DA DG L P DP DM E XT I FRG 3812 GA GR VY 3765 IAC I AS X: J MB T S XV :LM MAG Y MT G B T S X V : MMC A095660 NT E S NXP C 590057 OP W V T S XV :P N R BCI S FLY S TVI S O HU S P XA NC T Y TR E E U NT D V C LK K O S E : A069080 W DDD A052770 A052790 XT R A: A5A B W AV AIM: B G T C HIN.A G T S M: 3083 T S X: C X DXN DG T W A041060 T S X: F MN 6180 G E O 1V G IG M T S E : 3632 A047080 IE E 3888 L OO K 2121 MK B MY R N 777 T S X: NL N 2497 OT E X PWR D QP S A S NDA A066270 S C LW L OV 700 TS CM T S XV : US S UO MO V O IS W ZE O1B C A023770 Figure 21. Market Capitalization, By Company & Month Source. Capital IQ Slide 15: Page 15 Online Gaming companies lead market-cap charts: Thirteen companies in our W eb 2.0 universe top US$1 billion in market capitalization (Figure 22). Forty-six of the 80 companies have market caps under US$100 million, with 28 under US$25 million. Online gaming companies dominate the top of the list, led by Tencent Holdings (SEHK:700) with a market cap of approximately US$39.5 billion. Market C ap ($US mm) Tenc ent Holdings L td. Neteas e.c om Inc. S handa Interac tive Entertainment L td. Modern Times G roup Mtg A B G ree, Inc. IA C/InterA c tiveCorp. Open Tex t Corp. S ohu.c om Inc. Perf ec t World Co. , L td. Changyou. c om Limited G iant Interactiv e G roup, Inc. Mix i, Inc. Chines e G amer International K ings of t Co. L td. V alueClick Inc. NEOWIZ G ames Corporation United Online Inc. S K Communic ations Co. , L td. S hutterf ly, Inc. G ungHo Online Entertainment, Inc. NetDragon WebS of t, Inc. G amania Digital Entertainment Co. , L td. CDC Corp. XING A G My riad G roup A G OA O R B C Information S y s tems Openw ave S ys tems Inc. The9 Limited G igaMedia L td. DA DA S pA A ctoz S oft Co. , L td. Webz en Inc. Fluid Mus ic Canada, Inc. Tree. Com, Inc. Y D Online Corp. Eolith Co. L td. GameOn Co L td. Cyberplex Inc. NeuLion Incorporated TheS treet. com, Inc. HanbitS of t, Inc. Frogs ter Interactiv e Pictures A G S park Netw orks , Inc. PNI Digital Media Inc. G eoS entric Oy j G rav ity Co. , L td A Q Interactiv e, Inc. DXN Holdings B hd DigitalTow n, Inc. Ngi Group Inc. NeXplore Corporation Quepas a Corp. S ocialw is e, Inc. Multiplied Media Corporation A s knet A G Northgate Tec hnologies Limited A c celeriz e New Media, Inc. Wiz z ard S oftw are Corporation LookS mart, L td. MOK O. mobi Limited Y nk K orea Inc. J umbuc k Entertainment Limited Ex tens ions , Inc. V OIS , Inc. Dolphin Digital Media, Inc. Lingo Media Corporation is eemedia Inc. Magnitude Inf ormation S ys tems Inc. S pectrumDNA , Inc. B right Things plc Worlds .c om Inc. B roadWebA s ia Inc. S NA P Interactiv e, Inc. DigitalPos t Interactiv e, Inc. UOMO Media, Inc B etaw av e Corporation CornerWorld Corporation B igs tring Corp. Unis erv e Communic ations Corp. B eyond Commerc e, Inc. 0 Figure 22. Market Cap Rankin Source. Capital IQ 39524.0 4888. 4 3549. 7 3266. 2 2763. 0 2733. 1 2289. 1 2209. 9 1980. 3 1838. 1 1594. 3 1217. 0 1107. 4 905.9 869.9 734.8 618.6 561.6 463.7 311.5 275.4 260.7 237.5 232.1 205.8 193.9 193.1 179.8 178.8 136.8 128.8 114.1 104.7 101.3 94. 8 77. 9 76. 7 74. 6 74. 0 72. 8 72. 1 64. 1 61. 7 53. 0 51. 3 46. 7 40. 1 36. 4 32. 8 32. 6 31. 2 25. 5 24. 3 22. 4 21. 8 20. 2 18. 7 18. 2 16. 8 15. 9 15. 1 13. 5 13. 3 11. 9 11. 7 11. 2 9. 2 8. 0 7. 6 5. 6 4. 8 4. 2 4. 1 3. 9 3. 7 3. 7 2. 9 1. 5 1. 4 1. 2 500 1, 000 1,500 2,000 2, 500 3,000 3, 500 4, 000 Slide 16: Page 16 TEV/Revenue (LTM) averages 2.47x: The overall median TEV/Revenue (LTM) multiple for our group is 2.47x (Figure 23). The multiple at year-end dropped slightly from 2.53x at the end of November. The average multiple troughed in October 2008 at just 1.40x and peaked at 4.49x in January 2007. Note that we exclude multiples greater than 100x. E V / R evenue 5.0x 4.5x 4.0x 60 3.5x 3.0x Multiple (x) 2.5x 2.0x 1.5x 20 1.0x 0.5x 0.0x Ma y-05 Ma y-06 Ma y-07 Ma y-08 Ma y-09 Nov-05 Nov-06 Nov-07 Nov-08 S ep-05 S ep-06 S ep-07 S ep-08 Nov-09 Ma r-05 Ma r-06 Ma r-07 Ma r-08 Ma r-09 J ul-05 J ul-06 J ul-07 J ul-08 J ul-09 S ep-09 J a n-05 J a n-06 J a n-07 J a n-08 J a n-09 10 50 C ompa nies (#) 80 70 40 30 0 Median Figure 23. TEV/Revenue, By Month Source. Capital IQ C ount Slide 17: 10. 0 15. 0 20. 0 25. 0 30. 0 35. 0 40. 0 45. 0 0. 0 5. 0 Figure 24. TEV/Revenue Ranking Source. Capital IQ # Companies (x) 10.0 15.0 20.0 25.0 5.0 20.7 12.0 11.6 11.4 10.7 8.2 6.8 5.4 0.0 3 OTCPK 1 HLSE SEHK 3 16 2 OTCBB ASX 2 GTSM 3 TSX 5 TSE 5 Figures 25 & 26. TEV/Revenue Ranking (Exchange, Country) Source. Capital IQ 3.9 3.3 3.2 3.2 2.5 TSXV Average TEV/LTM Revenue - By Exchange 8 (x) 10.0 12.0 14.0 4.0 6.0 8.0 12.0 10.7 7.7 7.4 5.7 4.8 3.3 3.3 6.0 6.0 6.7 5.1 5.1 5.2 5.7 KOSE 3 3.2 8.1 8.1 XTRA 1 3.2 12.0 14.9 13.113.2 17.6 SWX 2 AMEX 2.3 2.0 1.7 0.8 0.6 1 OSE OM 1 14 1 NasdaqGS CM T E V/L T M R evenue (x) 1 KLSE 0.4 0.2 1 BSE 4 NasdaqGM 0.0 1 RTS 0.0 2.0 3.8 2.8 2.9 2.9 3.2 3.3 3.4 1.7 1.9 2.0 2.2 2.3 2.3 2.4 0.9 1.0 1.0 1.2 1.2 1.3 1.3 1.6 1.6 0.0 0.1 0.1 0.1 0.3 0.3 0.4 0.4 0.4 0.4 0.5 0.5 0.6 0.6 0.6 0.7 0.8 0.8 0.8 TEV/Revenue (LTM) by company: Three companies trade above 25x revenue – Tencent Holdings Ltd. (27.4x), Bigstring Corp. (40.4x), and Dolphin Digital Media, Inc. (42.1x) (Figure 24). Twenty-one companies have multiples under 1.0x. TEV/Revenue (LTM) by country/exchange: W e have also calculated multiples based on where the companies are listed or domiciled. Figure 25 shows the average TEV/Revenue multiples by stock exchange. The OTCBB has the largest number of companies (16), trading at an average multiple of 11.4x. On a geographic basis, the United States has the most companies (29), trading at an average of 7.7x revenue (Figure 26). # Companies 1 Finland Average TEV/LTM Revenue - By Country 2 Australia 29 United States 10 China 3 Taiwan 6 Japan 9 Canada 9 South Korea 3 Germany 1 Switzerland 2.0 1 Sweden 0.8 1 Italy 0.6 20.721.0 1 Malaysia 0.6 0.4 Page 17 1 Hong Kong 27.4 42.1 40.4 1 India G a meO n C o Ltd. As k net AG T heS treet.com, Inc . B eta wav e C orporation AQ Intera ctive, Inc . T ree.C om, Inc. P erfect World C o., Ltd. U nis erve C ommunications C orp. J umbuc k E nterta inment L imited N orthgate T echnologies L imited O penwave S y s tems Inc . C y berplex Inc . G igaMedia Ltd. C DC C orp. DXN Holdings B hd Ac toz S oft C o. , Ltd. S NAP Intera ctive, Inc. DADA S pA IAC /InterAc tiveC orp. United O nline Inc . B ey ond C ommerc e, Inc. H anbitS oft, Inc . Y nk K orea Inc . S pa rk N etwork s , Inc . V alueC lic k Inc . NetDra gon WebS oft, Inc . G a mania Digital E ntertainment C o., Ltd. S hutterfly , Inc . Y D O nline C orp. C ornerWorld C orporation Modern T imes G roup Mtg AB P N I Digital Media Inc. Webz en Inc . G ungH o O nline E ntertainment, Inc. NeuLion Inc orporated S K C ommunica tions C o., Ltd. O pen T ex t C orp. XIN G AG My riad G roup AG S ohu.com Inc . N E O WIZ G ames C orporation Wiz z ard S oftware C orporation DigitalP os t Intera ctive, Inc. is eemedia Inc . UO MO Media, Inc Acceleriz e New Media , Inc . C ha ngy ou.com L imited K ings oft C o. Ltd. F rogs ter Intera ctiv e P ic tures AG Lingo Media C orporation Mix i, Inc . G eoS entric O y j G ree, Inc . E olith C o. Ltd. C hines e G amer Interna tional F luid Mus ic C a nada , Inc. NeX plore C orporation MO K O .mobi L imited T encent Holdings Ltd. B igs tring C orp. Dolphin Digital Media, Inc. 0.0 1 Russia Slide 18: Page 18 TEV/EBITDA (LTM) averages 11.6x: The median multiple for the 41 companies with positive EBITDA (and multiples under 100x) is 10.75x LTM EBITDA (Figure 27). The median multiple has risen slightly from 10.50x at the end of November but is still well below the peak of 23.7x in April 2006. The median is up significantly from the recent trough levels around 5.5x. E V / E B ITDA 25. 0x 45 40 20. 0x 35 30 C ompa nies (#) 15. 0x Multiple (x) 25 20 10. 0x 15 5.0x 10 5 0.0x Ma y-05 Ma y-06 Ma y-07 Ma y-08 Ma y-09 Nov-05 Nov-06 Nov-07 Nov-08 S ep-05 S ep-06 S ep-07 S ep-08 Nov-09 Ma r-05 Ma r-06 Ma r-07 Ma r-08 Ma r-09 J ul-05 J ul-06 J ul-07 J ul-08 J ul-09 S ep-09 J a n-05 J a n-06 J a n-07 J a n-08 J a n-09 0 Median Figure 27. TEV/EBITDA , By month Source. Capital IQ C ount Slide 19: Page 19 TEV/EBITDA (LTM) by company: Uniserve Communications Corp. (40.2x) and SK Communications Co., Ltd. (43.7x) have the highest multiples in the group (Figure 28). Fourteen companies have EBITDA multiples under 7x. T E V/L T M E B IT DA (x) 50. 0 45. 0 40. 2 40. 0 35. 0 30. 0 25. 0 20. 0 15. 0 10. 0 5. 0 0. 0 G ameO n C o L td. 0. 2 0. 3 0. 7 1. 0 J umbuck E ntertainment L imited G ungH o O nline E ntertainment, Inc . NE O WIZ G ames C orporation G amania Digital E ntertainment C o. , Ltd. P NI Digital Media Inc . C hines e G amer International U nis erve C ommunic ations C orp. O AO R B C Information S y s tems C hangy ou. c om L imited T ree. C om, Inc . Modern T imes G roup Mtg AB S K C ommunic ations C o. , L td. U nited O nline Inc . T heS treet. c om, Inc . S NAP Interac tive, Inc . C DC C orp. AQ Interac tive, Inc . S park Network s , Inc . NetDragon WebS oft, Inc . O pen T ex t C orp. C yberplex Inc . V alueC lic k Inc . S ohu. c om Inc . Y D O nline C orp. IAC /InterAc tiveC orp. P erfec t World C o. , L td. Y nk K orea Inc. O penwave S y s tems Inc . Actoz S oft C o. , L td. K ings oft C o. L td. S hutterfly , Inc. E olith C o. L td. Webz en Inc. DADA S pA G ree, Inc . XING AG Mix i, Inc . 5. 8 6. 0 4. 4 4.5 4.8 5. 0 5. 4 3. 4 4. 1 4. 2 7. 6 7. 8 8. 0 10.5 10.8 11. 0 11. 2 9. 4 9. 7 10. 3 14. 9 13. 8 14. 2 12. 7 12. 8 13. 0 13. 2 21. 0 22.6 24. 5 25. 7 27. 7 43. 7 Figure 28. TEV/EBITDA Ranking Source. Capital IQ TEV/EBITDA (LTM) by country/exchange: Figure 29 shows the average TEV/EBITDA multiples by stock exchange. The OTCBB has the largest number of companies (14), trading at an average multiple of 4.8x. On a geographic basis, the U.S. has the most companies (29), trading at an average of 8.1x EBITDA (Figure 30). Average TEV/LTM EBITDA - By Exchange 30.0 26.5 25.0 20.0 (x) 13.8 13.1 18.217.6 10.8 10.5 9.7 8.9 6.0 6.0 5.8 4.8 NasdaqGM OTCBB Average TEV/LTM EBITDA - By Country 20.0 18.0 16.0 14.0 12.0 (x) 10.0 8.0 6.0 4.0 2.0 0.0 Germany Canada Japan United States China Hong Kong South Korea Taiwan Italy Sweden 18.2 17.6 17.2 13.8 12.6 10.8 10.3 8.1 7.5 6.0 1.0 0.3 Australia 2 Russia 1 15.0 10.0 5.0 4.5 1.0 ASX 2 0.3 RTS 1 GTSM 0.0 KOSE TSXV SEHK TSE OSE NasdaqGS OM XTRA CM AMEX # Companies 5 8 2 1 5 3 1 3 14 4 1 2 16 TSX 3 # Companies 9 3 9 1 6 3 1 29 10 1 Figures 29 & 30. TEV/EBITDA Ranking (Exchange, Country) Source. Capital IQ Slide 20: Page 20 P/E (LTM) averages 21.0x: The median multiple for the 32 companies with positive earnings (and multiples under 100x) is 17.7x LTM EPS (Figure 31). This is up from 16.0x at the end of November and well above the 8.8x trough multiple in November 2008. The peak multiple was 37.4x in April 2006. P /E 40. 0x 40 35. 0x 35 30. 0x 30 25. 0x Multiple (x) 25 C ompa nies (#) 20. 0x 20 15. 0x 15 10. 0x 10 5.0x 5 0.0x Ma y-05 Ma y-06 Ma y-07 Ma y-08 Ma y-09 Nov-05 Nov-06 Nov-07 Nov-08 S ep-05 S ep-06 S ep-07 S ep-08 Nov-09 Ma r-05 Ma r-06 Ma r-07 Ma r-08 Ma r-09 J ul-05 J ul-06 J ul-07 J ul-08 J ul-09 S ep-09 J a n-05 J a n-06 J a n-07 J a n-08 J a n-09 0 Median Figure 31. P/E, By Month Source. Capital IQ C ount Slide 21: Page 21 P/E (LTM) by company: Five companies have multiples greater than 50x – GungHo Online Entertainment, Inc. (60.6x), W ebzen Inc. (61.4x), Mixi, Inc. (63.1x), Tencent Holdings Ltd. (68.6x), and HanbitSoft, Inc. (70.0x) (Figure 32). Four companies have P/E multiples under 10x. P /E L T M (x) 80.0 70.0 60.6 61.4 60.0 50.0 40.0 31.4 30.0 20.0 10.0 1.7 G iant Interactive G roup, Inc. 0.0 2.0 T he9 Limited 2.3 S handa Interactive E ntertainment Ltd. 2.4 P erfect World C o., Ltd. 2.6 Neteas e.com Inc. 5.3 6.5 7.1 8.0 9.8 17.9 18.1 13.4 13.5 11.6 12.4 19.9 20.5 22.8 27.3 37.3 33.7 48.5 49.9 68.6 70.0 63.1 3.8 J umbuck E ntertainment Limited NE O W IZ G ames C orporation G amania Digital E ntertainment C o., Ltd. G ungH o O nline E ntertainment, Inc. Modern T imes G roup Mtg AB C hines e G amer International DXN H oldings B hd C hangy ou.com Limited G ameO n C o Ltd. S NAP Interactive, Inc. NetDragon W ebS oft, Inc. O pen T ex t C orp. C y berplex Inc. G igaMedia Ltd. T encent H oldings Ltd. 5.3 Malaysia 1 IAC /InterActiveC orp. S ohu.com Inc. S park Network s , Inc. Y D O nline C orp. G ree, Inc. XING AG Mix i, Inc. Figure 32. P/E Ranking Source. Capital IQ P/E (LTM) by country/exchange: Figure 33 shows the average P/E multiples by stock exchange. The OTCBB has the largest number of companies (16), trading at an average multiple of 22.8x. On a geographic basis, the U.S. has the most companies (29), trading at an average of 18.3x earnings (Figure 34). Average P/E - By Exchange 70.0 60.0 50.0 (x) 40.0 30.0 20.0 10.0 OTCBB GTSM 0.0 KOSE SEHK OSE TSE XTRA NasdaqGS AMEX OM 39.8 39.3 60.6 Actoz S oft C o., Ltd. K ings oft C o. Ltd. 50.0 45.0 40.0 35.0 30.0 Average P/E - By Country 45.0 (x) 34.0 32.7 31.4 31.4 30.5 28.2 22.7 18.3 18.1 13.9 3.8 22.8 20.5 18.1 25.0 20.0 15.0 10.0 11.6 6.5 5.3 3.8 KLSE TSX ASX 1.7 NYSE NasdaqGM 0.0 0.0 SWX 5.0 0.0 Germany Canada Japan United States South Korea China Australia 2 Taiwan Sweden # Companies 1 5 8 3 3 2 16 2 1 14 3 1 2 1 4 1 # Companies 6 9 3 9 3 29 1 10 Figures 33 & 34. P/E Ranking (Exchange, Country) Source. Capital IQ H anbitS oft, Inc. W ebz en Inc. Slide 22: Page 22 THE WEB 2.0 UNIVERSE Eighty public Web 2.0 companies: Our W eb 2.0 universe contains 80 companies, with a combined market cap of approximately $77.3 billion (Figure 35). The median market cap for the group is $72.4 million, with average trailing revenue of $176.5 million (median $59 million). The companies are also generally profitable with a median EBITDA margin of 15.6%. On a valuation basis, the overall average is 5.4x trailing revenue (median 1.9x) and 11.7x trailing EBITDA (median 10.0x). Twenty of the companies have more than 500 employees. C omparable C ompany Analys is > Web 2.0 C ompany Name Accelerize New Media, Inc. Actoz S oft C o. , Ltd. AQ Interactive, Inc. As knet AG B igs tring C orp. B eta wave C orpora tion B eyond C ommerce, Inc. B right T hings plc B roa dW ebAs ia Inc. C DC C orp. C hangyou. com Limited C hines e G amer Interna tional C ornerW orld C orporation C yberplex Inc. DADA S pA DXN Holdings B hd DigitalP os t Interactive, Inc. DigitalT own, Inc. Dolphin Digital Media, Inc. E olith C o. Ltd. E xtens ions , Inc. F luid Mus ic C anada, Inc. F rogs ter Intera ctive P ictures AG G ama nia Digital E nterta inment C o. , Ltd. G ameO n C o L td. G eoS entric O yj G iant Interactive G roup, Inc. G iga Media Ltd. G ravity C o., Ltd G ree, Inc. G ungHo O nline E ntertainment, Inc. HanbitS oft, Inc. IAC /InterActiveC orp. is eemedia Inc. J umbuck E ntertainment Limited K ings oft C o. Ltd. Lingo Media C orpora tion LookS mart, Ltd. Magnitude Information S ys tems Inc. Mixi, Inc. Modern T imes G roup Mtg AB MO K O .mobi Limited Multiplied Media C orporation Myriad G roup AG NE O W IZ G ames C orporation NetDragon W ebS oft, Inc. Neteas e.com Inc. NeuLion Incorporated NeXplore C orporation Ngi G roup Inc. Northgate T echnologies Limited O pen T ext C orp. O penwave S ys tems Inc. P erfect W orld C o. , Ltd. P NI Digital Media Inc. Q uepa s a C orp. O AO R B C Information S ys tems S handa Intera ctive E ntertainment Ltd. S hutterfly, Inc. S K C ommunications C o. , Ltd. S NAP Interactive, Inc. S ocialwis e, Inc. S ohu. com Inc. S park Networks , Inc. S pectrumDNA, Inc. T encent Holdings L td. T he9 Limited T heS treet. com, Inc. T ree.C om, Inc. U nis erve C ommunications C orp. U nited O nline Inc. U OMO Media, Inc V alueC lick Inc. V OIS , Inc. W ebzen Inc. W izzard S oftware C orpora tion W orlds . com Inc. XING AG Y D O nline C orp. Y nk K orea Inc. High Low Average Median L TM as of Ticker 9/30/2009 9/30/2009 9/30/2009 9/30/2009 9/30/2009 9/30/2009 9/30/2009 3/31/2009 9/30/2008 9/30/2009 9/30/2009 9/30/2009 7/31/2009 9/30/2009 6/30/2009 8/31/2009 9/30/2009 8/31/2009 9/30/2009 9/30/2009 9/30/2009 9/30/2009 6/30/2009 9/30/2009 9/30/2009 9/30/2009 9/30/2009 3/31/2009 9/30/2009 9/30/2009 9/30/2009 9/30/2009 9/30/2009 9/30/2009 6/30/2009 9/30/2009 9/30/2009 9/30/2009 9/30/2009 9/30/2009 9/30/2009 6/30/2009 9/30/2009 6/30/2009 12/31/2008 9/30/2009 9/30/2009 9/30/2009 6/30/2009 9/30/2009 9/30/2009 9/30/2009 9/30/2009 9/30/2009 9/30/2009 9/30/2009 12/31/2007 9/30/2009 9/30/2009 12/31/2008 9/30/2009 6/30/2009 9/30/2009 9/30/2009 9/30/2009 9/30/2009 12/31/2008 3/31/2009 9/30/2009 8/31/2009 9/30/2009 7/31/2009 9/30/2009 6/30/2009 9/30/2009 9/30/2009 9/30/2009 9/30/2009 12/31/2007 12/31/2008 AC LZ A052790 3838 X T R A: A5A BS GC B W AV B Y OC AIM: B G T BWBA C HIN.A C Y OU G T S M: 3083 CWR L T S X: C X C M: DA DX N DG LP DG T W DP DM A041060 E XTI T S X: F MN FR G 6180 3812 G E O 1V GA G IG M GR VY T S E :3632 3765 A047080 IAC I IE E AS X: J MB 3888 T S XV : LM LO O K MAG Y 2121 MT G B MK B T S XV : MMC MY R N A095660 777 NT E S T S X: NLN NX P C 2497 590057 OT E X OP W V PWR D T S XV : P N QP S A R BCI S NDA S F LY A066270 S TVI S C LW S O HU LO V S P XA 700 NC T Y TS CM TR E E T S XV : U S S U NT D U O MO V C LK V O IS K O S E :A069080 W ZE W DDD O 1B C A052770 A023770 E xc hange OT C B B K OS E TS E XT R A OT C B B OT C B B OT C B B AIM OT C P K Na s daqG S Na s daqG S GTS M OT C B B TS X CM K LS E OT C B B OT C B B OT C B B K OS E OT C P K TS X XT R A GTS M TS E HL S E NY S E Na s daqG S Na s daqG M TS E OS E K OS E Na s daqG S T S XV AS X S E HK T S XV Na s daqG M OT C B B TS E OM AS X T S XV SWX K OS E S E HK Na s daqG S TS X OT C P K TS E BSE Na s daqG S Na s daqG S Na s daqG S T S XV OT C B B R TS Na s daqG S Na s daqG S K OS E OT C B B OT C B B Na s daqG S AME X OT C B B S E HK Na s daqG S Na s daqG M Na s daqG M T S XV Na s daqG S OT C B B Na s daqG S OT C B B K OS E AME X OT C B B XT R A K OS E K OS E Trading C urrency HQ US D KRW JPY E UR US D US D US D GBP US D US D US D TWD US D C AD E UR MY R US D US D US D KRW US D C AD E UR TWD JPY E UR US D US D US D JPY JPY KRW US D C AD AU D HK D C AD US D US D JPY SEK AU D C AD C HF KRW HK D US D C AD US D JPY INR US D US D US D C AD US D US D US D US D KRW US D US D US D US D US D HK D US D US D US D C AD US D US D US D US D KRW US D US D E UR KRW KRW U nited S tates S outh K orea J apa n G ermany U nited S tates U nited S tates U nited S tates U nited K ingdom U nited S tates Hong K ong C hina T a iwan U nited S tates C a nada Italy Malays ia U nited S tates U nited S tates U nited S tates S outh K orea U nited S tates U nited S tates G ermany T a iwan J apa n F inla nd C hina T a iwan S outh K orea J apa n J apa n S outh K orea U nited S tates C a nada Aus tralia C hina C a nada U nited S tates U nited S tates J apa n S weden Aus tralia C a nada S witzerland S outh K orea C hina C hina C a nada U nited S tates J apa n India C a nada U nited S tates C hina C a nada U nited S tates R us s ia C hina U nited S tates S outh K orea U nited S tates U nited S tates C hina U nited S tates U nited S tates C hina C hina U nited S tates U nited S tates C a nada U nited S tates C a nada U nited S tates U nited S tates S outh K orea U nited S tates U nited S tates G ermany S outh K orea S outh K orea C urrent P ric e 0. 65 17, 050 68, 300 3 0. 02 0. 13 0. 02 0. 01 0. 05 2. 24 33.42 424.00 0. 03 1 5. 91 0. 55 0 1. 20 0. 21 595.00 0. 30 1. 75 17.50 55 73500. 00 0. 04 7. 04 3. 28 2 5720.00 252000 3830.00 20.71 0 0 6 0. 95 0. 98 0. 02 732, 000 356 0. 15 0. 18 4. 85 40550. 00 4. 04 37.77 0. 67 0. 56 24400. 00 27 40.60 2. 31 40 1. 66 2. 00 1. 40 52.78 18.06 15600. 00 0 0. 51 57.46 3. 00 0. 16 169 7. 16 2 9. 29 0. 06 7 0 10 0. 01 11200. 00 0. 34 0. 09 30.80 7350.00 3290 US D Market C ap ($m) 18. 7 128.8 40. 1 21. 8 1.5 3.7 1.2 5.6 4.2 237.5 1, 838.1 1, 107.4 2.9 74. 6 136.8 36. 4 3.9 32. 8 11. 7 77. 9 13. 3 104.7 64. 1 260.7 76. 7 51. 3 1, 594.3 178.8 46. 7 2, 763.0 311.5 72. 1 2, 733.1 9.2 13. 5 905.9 11. 2 16. 8 8.0 1, 217.0 3, 266.2 15. 9 22. 4 205.8 734.8 275.4 4, 888.4 74. 0 31. 2 32. 6 20. 2 2, 289.1 193.1 1, 980.3 53. 0 25. 5 193.9 3, 549.7 463.7 561.6 4.1 24. 3 2, 209.9 61. 7 7.6 39, 524. 0 179.8 72. 8 101.3 1.4 618.6 3.7 869.9 11. 9 114.1 18. 2 4.8 232.1 94. 8 15. 1 39, 524. 0 1.2 966.1 72. 4 US D L TM Total R ev ($m) 4. 1 118. 8 71.4 101. 1 0. 1 8. 4 13.5 0. 0 0. 0 334. 2 255. 3 68.8 6. 8 109. 0 236. 1 78.5 1. 2 0. 0 0. 3 5. 9 0. 0 5. 6 9. 4 152. 2 76.5 4. 5 202. 3 183. 6 51.2 202. 9 116. 4 59.1 1, 359. 6 1. 9 17.1 143. 5 1. 4 54.0 0. 1 134. 7 1, 942. 0 0. 7 0. 2 63.0 212. 7 91.4 483. 1 24.9 1. 7 78.8 47.7 814. 5 190. 5 286. 2 23.2 0. 2 156. 3 694. 6 223. 1 197. 7 3. 4 0. 0 501. 0 47.5 0. 1 1, 589. 0 250. 7 67.0 217. 1 16.6 996. 8 0. 8 545. 7 0. 0 23.6 5. 2 0. 1 61.0 58.9 12.2 1,942. 0 0.0 176.5 59.0 US D L TM Total E B ITDA ($m) (1.5) 26. 4 3.6 (2.3) (1.0) (14. 3) (12. 4) (2.7) (4.6) 20. 0 157. 4 39. 9 NM 12. 1 31. 0 (85. 2) (0.9) (1.8) (4.6) 2.8 NM (3.0) (4.4) 25. 1 18. 0 (18. 5) 137. 9 NM 18. 1 117. 9 25. 9 (0.3) 82. 4 (4.2) 7.3 57. 7 (2.3) (4.5) (2.3) 44. 5 274. 4 (2.5) (4.7) 3.4 57. 1 27. 8 291. 9 (16. 1) (13. 3) 3.1 (51. 2) 211. 1 6.2 157. 4 3.9 (9.8) 20. 4 317. 3 27. 0 12. 9 0.5 (5.6) 218. 4 10. 0 (2.5) 811. 6 85. 5 1.9 9.7 0.2 212. 9 (0.4) 130. 8 (1.0) 2.6 (3.9) (0.6) 16. 5 12. 7 1.3 811.6 -85.2 45.1 3. 4 E B ITDA % -36. 5% 22. 2% 5.1% -2.3% NM NM -91. 9% NM NM 6.0% 61. 7% 58. 0% NM 11. 1% 13. 1% NM -73. 8% NM NM 47. 6% NM -54. 0% -47. 0% 16. 5% 23. 5% NM 68. 2% NM 35. 4% 58. 1% 22. 3% -0.6% 6.1% NM 42. 8% 40. 2% NM -8.4% NM 33. 0% 14. 1% NM NM 5.4% 26. 8% 30. 4% 60. 4% -64. 5% NM 3.9% NM 25. 9% 3.3% 55. 0% 17. 0% NM 13. 1% 45. 7% 12. 1% 6.5% 15. 6% NM 43. 6% 21. 0% NM 51. 1% 34. 1% 2.9% 4.5% 0.9% 21. 4% -54. 2% 24. 0% NM 11. 0% -76. 4% NM 27. 0% 21. 6% 10. 5% 68. 2% -91. 9% 11.8% 15. 6% TE V/L TM R evenue 5.7x 0.7x 0.3x 0.1x 40. 4x 0.1x 1.0x 0.6x 6.0x 14. 9x 1.9x 0.5x 0.8x 0.6x 5.1x 42. 1x 13. 2x 17. 6x 6.7x 1.6x 0.0x 12. 0x 0.6x 13. 1x 2.3x 1.0x 0.8x 5.1x 0.4x 6.0x 8.1x 8.1x 2.0x 21. 0x 3.2x 3.4x 1.3x 2.4x 20. 7x 0.4x 2.9x 0.5x 0.4x 2.2x 0.0x 1.6x 2.8x 0.8x 3.3x 1.2x 27. 4x 0.1x 0.3x 0.4x 0.9x 5.2x 1.3x 2.3x 3.8x 2.9x 1.7x 1.2x 42. 1x 0.0x 5.4x 1.9x TE V/L TM E B ITDA 3. 4x 5. 0x 10.3x 9. 7x 25.7x 4. 5x 6. 0x 27.7x 9. 4x 0. 2x 22.6x 10.5x 13.2x 1. 0x 14.9x 24.5x 13.8x 12.7x 4. 4x 11.2x 14.2x 0. 7x 12.8x 0. 3x 13.0x 43.7x 4. 8x 7. 6x 5. 8x 4. 2x 7. 8x 40.2x 4. 1x 5. 4x 21.0x 10.8x 8. 0x 11.0x 43.7x 0. 2x 11.7x 10.0x E mployees 11 NA NA NA 4 48 86 NA 46 2, 227 628 NA 16 NA NA NA 7 3 NA NA 2 NA NA NA NA 118 1, 570 751 469 NA NA NA 3, 200 NA 79 2, 271 NA 90 14 NA 2, 969 NA NA 405 NA 2, 426 3, 109 237 NA NA NA 3, 900 590 2, 096 NA 74 NA 3, 124 514 NA 11 NA 3, 197 183 7 6, 194 1, 626 310 700 NA 1, 469 NA 1, 189 4 328 110 1 266 NA NA 6,194 1 1,015 319 Figure 35. Web 2.0 Universe Summary Source. Capital IQ Slide 23: Page 23 C omparable C ompany Analys is > Web 2.0 P ric e P erformanc e C ompany Name A ccelerize New Media, Inc. A ctoz S oft C o. , L td. A Q Interactive, Inc. A s knet AG B igs tring C orp. B eta wave C orporation B eyond C ommerce, Inc. B right T hings plc B roadW ebA s ia Inc. C DC C orp. C ha ngyou.com L imited C hines e G a mer International C ornerW orld C orpora tion C yberplex Inc. DADA S pA DXN Holdings B hd DigitalP os t Intera ctive, Inc. DigitalT own, Inc. Dolphin Digital Media, Inc. E olith C o. Ltd. E xtens ions , Inc. F luid Mus ic C anada , Inc. F rogs ter Intera ctive P ictures A G G amania Digita l E nterta inment C o. , Ltd. G ameO n C o Ltd. G eoS entric Oyj G ia nt Interactive G roup, Inc. G igaMedia Ltd. G ra vity C o., L td G ree, Inc. G ungH o Online E nterta inment, Inc. H anbitS oft, Inc. IAC /InterA ctiveC orp. is eemedia Inc. J umbuck E nterta inment L imited K ings oft C o. Ltd. L ingo Media C orpora tion L ookS mart, L td. Ma gnitude Informa tion S ys tems Inc. Mixi, Inc. Modern T imes G roup Mtg AB MO K O .mobi Limited Multiplied Media C orporation Myriad G roup AG NE O W IZ G ames C orpora tion NetDra gon W ebS oft, Inc. Neteas e. com Inc. NeuLion Incorpora ted NeXplore C orpora tion Ngi G roup Inc. Northgate T echnologies L imited O pen T ext C orp. O penwa ve S ys tems Inc. P erfect W orld C o., L td. P NI Digital Media Inc. Q uepa s a C orp. O AO R B C Informa tion S ys tems S ha nda Intera ctive E nterta inment L td. S hutterfly, Inc. S K C ommunications C o., Ltd. S NA P Intera ctive, Inc. S ocialwis e, Inc. S ohu.com Inc. S pa rk Networks , Inc. S pectrumDNA, Inc. T encent H oldings Ltd. T he9 L imited T heS treet.com, Inc. T ree.C om, Inc. U nis erve C ommunica tions C orp. U nited O nline Inc. U OMO Media , Inc V alueC lick Inc. V OIS , Inc. W ebzen Inc. W izzard S oftwa re C orporation W orlds .com Inc. XING A G Y D Online C orp. Y nk K orea Inc. H igh L ow Average Media n C urrency US D KR W JPY E UR US D US D US D GBP US D US D US D TWD US D C AD E UR MY R US D US D US D KR W US D C AD E UR TWD JPY E UR US D US D US D JPY JPY KR W US D C AD AU D HK D C AD US D US D JPY SEK AU D C AD C HF KR W HK D US D C AD US D JPY INR US D US D US D C AD US D US D US D US D KR W US D US D US D US D US D HK D US D US D US D C AD US D US D US D US D KR W US D US D E UR KR W KR W Ticker AC LZ A052790 3838 XT R A:A 5A BS GC B W AV B Y OC AIM:B G T BWBA C H IN.A CY OU G T S M:3083 CW R L T S X: C X C M: DA DXN DG LP DG T W DP DM A041060 E XT I T S X: F MN FR G 6180 3812 G E O1V GA G IG M GR VY T S E :3632 3765 A047080 IA C I IE E AS X:J MB 3888 T S XV :L M LO O K MAG Y 2121 MT G B MK B T S XV :MMC MY R N A095660 777 NT E S T S X: NL N NXP C 2497 590057 OT E X OP W V PWRD T S XV :P N QP S A R BCI S NDA S F LY A066270 S TVI S C LW S O HU LO V S P XA 700 NC T Y TS CM TR E E T S XV :U S S UNT D UO MO V C LK V O IS K O S E :A069080 W ZE W DDD O1B C A052770 A023770 E xc hange OTC B B K OS E TSE XT R A OTC B B OTC B B OTC B B A IM OTC P K Nas da qG S Nas da qG S GTS M OTC B B TSX CM K LS E OTC B B OTC B B OTC B B K OS E OTC P K TSX XT R A GTS M TSE H LS E NY S E Nas da qG S Nas da qG M TSE OS E K OS E Nas da qG S T S XV AS X S E HK T S XV Nas da qG M OTC B B TSE OM AS X T S XV S WX K OS E S E HK Nas da qG S TSX OTC P K TSE BSE Nas da qG S Nas da qG S Nas da qG S T S XV OTC B B R TS Nas da qG S Nas da qG S K OS E OTC B B OTC B B Nas da qG S A ME X OTC B B S E HK Nas da qG S Nas da qG M Nas da qG M T S XV Nas da qG S OTC B B Nas da qG S OTC B B K OS E A ME X OTC B B XT R A K OS E K OS E US D Market C ap ($m) 18.7 128.8 40.1 21.8 1. 5 3. 7 1. 2 5. 6 4. 2 237.5 1,838.1 1,107.4 2. 9 74.6 136.8 36.4 3. 9 32.8 11.7 77.9 13.3 104.7 64.1 260.7 76.7 51.3 1,594.3 178.8 46.7 2,763.0 311.5 72.1 2,733.1 9. 2 13.5 905.9 11.2 16.8 8. 0 1,217.0 3,266.2 15.9 22.4 205.8 734.8 275.4 4,888.4 74.0 31.2 32.6 20.2 2,289.1 193.1 1,980.3 53.0 25.5 193.9 3,549.7 463.7 561.6 4. 1 24.3 2,209.9 61.7 7. 6 39,524.0 179.8 72.8 101.3 1. 4 618.6 3. 7 869.9 11.9 114.1 18.2 4. 8 232.1 94.8 15.1 C urrent P ric e 0.65 17,050 68,300 3.03 0.02 0.13 0.02 0.01 0.05 2.24 33.42 424.00 0.03 1.14 5.91 0.55 0.05 1.20 0.21 595.00 0.30 1.75 17.50 54.70 73, 500.00 0.04 7.04 3.28 2 5, 720.00 252, 000.00 3, 830.00 20.71 0 0 6 0.95 0.98 0.02 732, 000.00 355.90 0.15 0.18 4.85 40, 550.00 4.04 37.77 0.67 0.56 24, 400.00 27.05 40.60 2.31 39.80 1.66 2.00 1.40 52.78 18.06 15, 600.00 0.38 0.51 57.46 3.00 0.16 168.50 7.16 2.38 9.29 0.06 7.31 0.04 10 0.01 11, 200.00 0.34 0.09 30.80 7, 350.00 3, 290.00 1 Wk 0. 0% -6.8% 50.8% -3.8% 20.6% 4. 2% 0. 0% 13.0% -44.4% -2.6% -0.2% 3. 4% 0. 0% -0.9% 1. 1% -1.8% -8.2% 18.8% -2.4% 4. 4% -33.3% 1. 2% 0. 3% 8. 7% 11.5% -20.0% 0. 4% 3. 1% 17.5% 3. 8% 60.0% -4.4% 4. 6% 0. 0% 3. 3% 4. 6% 0. 0% -5.7% -5.3% -5.5% 3. 7% -9.1% 2. 9% 1. 0% 2. 4% 2. 0% 0. 2% 1. 5% -11.1% -6.1% -2.0% 1. 1% -0.3% -3.1% -2.9% -9.1% -12.7% 2. 3% -0.8% 27.9% 26.7% 4. 1% 1. 4% 0. 0% 3. 3% 4. 3% -1.5% 0. 8% -0.4% 50.0% 0. 9% -16.0% 2. 5% 0. 0% -5.9% -8.1% 0. 0% 1. 8% 6. 5% -1.5% 60.0% -44.4% 1.8% 0. 2% 1 Mth -11.0% -22.0% 68.9% -16.1% -17.2% 56.3% -50.0% 6.1% -44.4% -8.9% 1.2% -1.6% -40.0% -7.3% -5.9% -1.8% -15.1% -14.3% -26.8% 6.3% 0.0% -12.5% -1.4% 18.8% 17.8% 0.0% -1.4% -17.6% 12.8% 24.3% 71.8% 4.4% 6.6% -5.1% -6.1% 10.3% -1.0% -8.3% -5.3% 4.6% 14.8% 25.0% 5.9% 0.0% -4.0% -5.8% -5.0% -8.2% -24.3% 9.9% -16.4% 6.0% -2.0% -11.8% 0.6% 43.9% -12.7% -0.6% 20.4% 106.9% 90.0% 4.1% 2.1% 27.7% 10.7% 14.9% -7.9% 2.9% 46.1% 50.0% 5.1% -30.0% 5.6% 0.0% 0.9% -19.1% -10.0% -6.4% 20.1% -11.0% 106.9% -50.0% 3.8% -0.3% 3 Mth 0. 0% -5.3% 34.2% -2.3% -33.3% 56.3% -85.2% 3. 8% -78.3% -9.3% 2. 7% -9.8% -50.0% -12.3% -14.8% -8.3% -19.6% -40.0% -48.8% -18.5% 25.0% 25.0% -2.7% 14.3% -17.5% -20.0% 6. 8% -29.9% -5.6% 19.2% 9. 6% -7.9% 8. 0% 42.3% -20.5% -7.1% -5.0% -14.7% 100.0% 25.6% 19.4% 130.8% 33.3% 4. 8% -4.9% -19.8% -14.0% -33.0% -13.8% 0. 7% -35.4% 9. 4% -7.9% -11.5% -14.0% 25.0% 20.5% 9. 8% 15.5% 76.3% 8. 6% -16.4% -11.1% 34.5% 19.2% 37.1% -5.6% -18.8% 19.1% 50.0% -5.2% -65.3% -20.3% 200.0% 6. 7% -26.1% 0. 0% -13.2% -14.6% -15.6% 200.0% -85.2% 2.0% -5.2% 6 Mth 62.5% -33. 8% -1.7% -3.5% -29. 4% 56.3% -94. 9% -13. 3% -78. 3% 48.3% -16. 0% -4.3% -50. 0% -30. 9% -8.0% 48.6% 28.6% -41. 5% -57. 3% -20. 1% 200. 0% 150. 0% 54.9% -7.3% -32. 9% 0.0% -11. 3% -41. 5% 52.7% 59.8% 0.0% -18. 1% 28.8% 117. 6% -20. 5% 12.2% -20. 8% -18. 2% 93.5% 28.9% 54.4% 114. 3% 125. 0% -2.8% 25.5% -29. 0% 12.6% -8.2% -20. 0% -32. 2% -29. 8% 10.3% 5.6% 34.7% 10.7% 100. 0% 55.3% -0.7% 33.8% 58.4% -15. 6% -26. 1% -5.2% 29.3% -46. 6% 89.9% -24. 4% 17.7% -1.8% -25. 0% 14.3% -68. 9% 1.9% -16. 7% -30. 2% -32. 0% -21. 7% 2.3% -18. 2% -52. 2% 200. 0% -94. 9% 8.5% -3.2% 1 Yr 85.7% 61.6% 132.3% -26.1% 29.7% -47.9% -98.4% 4. 0% -90.9% 80.6% NM 353.5% -88.0% 192.3% -14.4% 57.1% 181.3% -55.6% -74.4% 4. 4% 50.0% 400.0% 198.1% 150.3% -40.0% 0. 0% 11.2% -50.5% 180.0% 112.6% 155.8% 10.4% 28.6% 184.6% -20.5% 130.1% -5. 0% -40.5% -28.0% 33.8% 103.4% 200.0% 227.3% -24.2% 277.2% 40.3% 82.6% 42.6% -44.0% -52.2% -59.4% 28.8% 235.1% 121.6% 9. 2% 5. 3% 179.5% 57.7% 143.7% 172.7% -45.7% -38.6% 16.9% 17.6% 3. 3% 221.6% -49.2% -30.7% 145.1% 50.0% 24.4% -58.0% 42.4% 200.0% 153.1% -64.2% -55.0% 13.2% 16.1% -25.3% 400.0% -98.4% 56.1% 28.6% 52 Week -18.8% -52.6% -17.7% -26.5% -57.9% -47.9% -98.9% -47.4% -97.5% -42.9% -30.9% -18.3% -92.7% -42.7% -27.9% -20.3% -54.5% -65.7% -74.4% -48.7% -70.3% -18.6% -18.6% -20.5% -44.7% -33.3% -26.4% -57.6% -36.1% -5.0% -10.0% -42.3% -2.7% -31.5% -38.0% -32.2% -33.6% -45.0% -53.8% -15.4% -0.1% -25.0% -23.4% -24.2% -9.7% -43.5% -22.1% -48.5% -44.0% -59.3% -62.8% -2.0% -26.1% -21.2% -22.1% -20.0% -17.8% -18.8% -4.0% -4.3% -64.8% -50.0% -20.5% -11.0% -65.6% -0.3% -57.0% -33.0% -28.9% -40.0% -22.7% -96.0% -27.2% -47.8% -45.9% -64.2% -60.9% -18.9% -40.7% -62.2% -0.1% -98.9% -37.2% -33.2% 966.1 Figure 36. Price Performance Source. Capital IQ Slide 24: Page 24 C omparable C ompany Analys is > Web 2.0 Valuation Multiples C ompany Name Accelerize New Media, Inc. Actoz S oft C o., Ltd. AQ Interactive, Inc. As knet AG B igs tring C orp. B etawave C orporation B eyond C ommerce, Inc. B right T hings plc B roadW ebAs ia Inc. C DC C orp. C hangyou. com L imited C hines e G amer International C ornerW orld C orpora tion C yberplex Inc. DADA S pA DXN Holdings B hd DigitalP os t Intera ctive, Inc. DigitalT own, Inc. Dolphin Digital Media , Inc. E olith C o. Ltd. E xtens ions , Inc. F luid Mus ic C ana da, Inc. F rogs ter Intera ctive P ictures AG G amania Digita l E nterta inment C o., L td. G ameO n C o L td. G eoS entric Oyj G iant Intera ctive G roup, Inc. G igaMedia L td. G ravity C o., Ltd G ree, Inc. G ungHo O nline E ntertainment, Inc. H anbitS oft, Inc. IAC /InterActiveC orp. is eemedia Inc. J umbuck E nterta inment L imited K ings oft C o. L td. L ingo Media C orporation L ookS mart, Ltd. Magnitude Information S ys tems Inc. Mixi, Inc. Modern T imes G roup Mtg AB MOK O.mobi L imited Multiplied Media C orporation Myria d G roup AG N E OW IZ G ames C orporation N etDragon W ebS oft, Inc. N etea s e.com Inc. N euL ion Incorporated N eXplore C orporation N gi G roup Inc. N orthgate T echnologies Limited O pen T ext C orp. O penwa ve S ys tems Inc. P erfect W orld C o. , Ltd. P N I Digita l Media Inc. Q uepas a C orp. O AO R B C Information S ys tems S handa Interactive E ntertainment Ltd. S hutterfly, Inc. S K C ommunications C o., Ltd. S N AP Interactive, Inc. S ocialwis e, Inc. S ohu. com Inc. S park N etworks , Inc. S pectrumDNA, Inc. T encent H oldings L td. T he9 L imited T heS treet. com, Inc. T ree.C om, Inc. U nis erve C ommunica tions C orp. U nited Online Inc. U OMO Media, Inc V a lueC lick Inc. V O IS , Inc. W ebzen Inc. W izzard S oftwa re C orpora tion W orlds .com Inc. XING A G Y D O nline C orp. Y nk K orea Inc. H igh L ow Average Median S ec tor Direct Ma rketing G aming G aming G aming Ins ta nt Mes s aging Media S ocial Networking S ocial Networking S ocial Networking G aming G aming G aming C ontent Advertis ing S ocial Networking S ocial Networking C ontent S ocial Networking S ocial Networking G aming C ontent Media G aming G aming G aming Mobile G aming G aming G aming S ocial Networking Media G aming Media C ontent S ocial Networking G aming Learning Direct Ma rketing S ocial Networking S ocial Networking Media S ocial Networking Mobile Mobile G aming G aming G aming V ideo C ontent Media Direct Ma rketing C ollabora tion Mobile G aming Digital Ima ging S ocial Networking Media G aming Digital Ima ging S earch Da ting S ocial Networking G aming S ocial Networking Media P ortal G aming Media P ortal S ocial Networking Media Media Media S ocial Networking G aming P odca s ting C ontent S ocial Networking G aming G aming C ountry U nited S ta tes S outh K orea J apa n G ermany U nited S ta tes U nited S ta tes U nited S ta tes U nited K ingdom U nited S ta tes H ong K ong C hina T aiwan U nited S ta tes C ana da Italy Ma lays ia U nited S ta tes U nited S ta tes U nited S ta tes S outh K orea U nited S ta tes U nited S ta tes G ermany T aiwan J apa n F inla nd C hina T aiwan S outh K orea J apa n J apa n S outh K orea U nited S ta tes C ana da A us tralia C hina C ana da U nited S ta tes U nited S ta tes J apa n S weden A us tralia C ana da S witzerland S outh K orea C hina C hina C ana da U nited S ta tes J apa n India C ana da U nited S ta tes C hina C ana da U nited S ta tes R us s ia C hina U nited S ta tes S outh K orea U nited S ta tes U nited S ta tes C hina U nited S ta tes U nited S ta tes C hina C hina U nited S ta tes U nited S ta tes C ana da U nited S ta tes C ana da U nited S ta tes U nited S ta tes S outh K orea U nited S ta tes U nited S ta tes G ermany S outh K orea S outh K orea P rimary E xc hange OT C B B K OS E TS E XT R A OT C B B OT C B B OT C B B AIM OT C P K Nas daqG S Nas daqG S GTS M OT C B B TS X CM K LS E OT C B B OT C B B OT C B B K OS E OT C P K TS X XT R A GTS M TS E HLS E NY S E Nas daqG S Nas daqG M TS E OS E K OS E Nas daqG S T S XV AS X S E HK T S XV Nas daqG M OT C B B TS E OM AS X T S XV SWX K OS E S E HK Nas daqG S TS X OT C P K TS E BSE Nas daqG S Nas daqG S Nas daqG S T S XV OT C B B R TS Nas daqG S Nas daqG S K OS E OT C B B OT C B B Nas daqG S AME X OT C B B S E HK Nas daqG S Nas daqG M Nas daqG M T S XV Nas daqG S OT C B B Nas daqG S OT C B B K OS E AME X OT C B B XT R A K OS E K OS E Tic ker AC LZ A052790 3838 XT R A: A5A BSGC B W AV B YOC AIM:B G T BWBA C HIN .A C Y OU G T S M:3083 CW R L T S X:C X C M:DA DXN DG L P DG T W DP DM A041060 E XT I T S X:F MN FR G 6180 3812 G E O1V GA G IG M GR VY T S E :3632 3765 A047080 IAC I IE E AS X:J MB 3888 T S XV :L M LO OK MAG Y 2121 MT G B MK B T S XV :MMC MY R N A095660 777 NT E S T S X:NLN NXP C 2497 590057 OT E X OP W V PWRD T S XV :P N QP S A R BCI S N DA S F LY A066270 STVI S CLW S O HU LO V S P XA 700 NC T Y TS CM TR E E T S XV :US S UN T D UO MO V C LK V OIS K OS E :A069080 W ZE W DDD O1B C A052770 A023770 US D Market C ap ($m) 18. 7 128. 8 40. 1 21. 8 1. 5 3. 7 1. 2 5. 6 4. 2 237. 5 1,838. 1 1,107. 4 2. 9 74. 6 136. 8 36. 4 3. 9 32. 8 11. 7 77. 9 13. 3 104. 7 64. 1 260. 7 76. 7 51. 3 1,594. 3 178. 8 46. 7 2,763. 0 311. 5 72. 1 2,733. 1 9. 2 13. 5 905. 9 11. 2 16. 8 8. 0 1,217. 0 3,266. 2 15. 9 22. 4 205. 8 734. 8 275. 4 4,888. 4 74. 0 31. 2 32. 6 20. 2 2,289. 1 193. 1 1,980. 3 53. 0 25. 5 193. 9 3,549. 7 463. 7 561. 6 4. 1 24. 3 2,209. 9 61. 7 7. 6 39,524. 0 179. 8 72. 8 101. 3 1. 4 618. 6 3. 7 869. 9 11. 9 114. 1 18. 2 4. 8 232. 1 94. 8 15. 1 39,524. 0 1. 2 966.1 72. 4 TE V/L TM R evenue 5. 7x 0. 7x 0. 3x 0. 1x 40.4x 0. 1x 1. 0x 0. 6x 6. 0x 14.9x 1. 9x 0. 5x 0. 8x 0. 6x 5. 1x 42.1x 13.2x 17.6x 6. 7x 1. 6x 0. 0x 12.0x 0. 6x 13.1x 2. 3x 1. 0x 0. 8x 5. 1x 0. 4x 6. 0x 8. 1x 8. 1x 2. 0x 21.0x 3. 2x 3. 4x 1. 3x 2. 4x 20.7x 0. 4x 2. 9x 0. 5x 0. 4x 2. 2x 0. 0x 1. 6x 2. 8x 0. 8x 3. 3x 1. 2x 27.4x 0. 1x 0. 3x 0. 4x 0. 9x 5. 2x 1. 3x 2. 3x 3. 8x 2. 9x 1. 7x 1. 2x 42.1x 0. 0x 5.4x 1. 9x TE V/ NTM R evenue 0. 6x 5. 0x 0. 4x 0. 8x 17.6x 1. 1x 0. 8x 5. 5x 2. 5x 0. 5x 1. 9x 1. 9x 1. 5x 2. 9x 0. 1x 0. 3x 0. 9x 1. 4x 17.6x 0. 1x 2.5x 1. 2x TE V/L TM E B ITDA 3.4x 5.0x 10. 3x 9.7x 25. 7x 4.5x 6.0x 27. 7x 9.4x 0.2x 22. 6x 10. 5x 13. 2x 1.0x 14. 9x 24. 5x 13. 8x 12. 7x 4.4x 11. 2x 14. 2x 0.7x 12. 8x 0.3x 13. 0x 43. 7x 4.8x 7.6x 5.8x 4.2x 7.8x 40. 2x 4.1x 5.4x 21. 0x 10. 8x 8.0x 11. 0x 43. 7x 0.2x 11.7x 10. 0x TE V/NTM E B ITDA 4.9x 7.7x 3.6x 22.6x 5.6x 9.3x 4.4x 3.7x 5.9x 8.0x 6.5x 9.1x 3.6x 5.3x 22.6x 3.6x 7.2x 5.7x P /L TM E P S 17.9x 12.4x 33.7x 6. 5x 5. 3x 27.3x 8. 0x 1. 7x 7. 1x 0. 0x 48.5x 60.6x 70.0x 11.6x 3. 8x 19.9x 63.1x 18.1x 37.3x 13.4x 2. 6x 49.9x 2. 4x 2. 3x 22.8x 13.5x 20.5x 68.6x 2. 0x 61.4x 31.4x 9. 8x 70.0x 0. 0x 23.5x 15.7x P /NTM E P S 10.9x 6. 8x 0. 8x 14.9x 30.4x 14.2x 13.6x 32.6x 11.5x 10.4x 14.6x 15.5x 5. 6x 16.5x 32.6x 0. 8x 14.2x 13.9x P /TangB V 1. 9x 0. 7x 2. 5x 10.1x 9. 6x 16.1x 2. 6x 0. 7x 0. 9x 7. 6x 8. 1x 3. 3x 0. 9x 0. 3x 1. 5x 0. 0x 23.0x 9. 9x 2. 0x 1. 4x 1. 2x 4. 8x 0. 7x 8. 1x 14.2x 16.2x 18.9x 1. 5x 0. 7x 10.0x 0. 6x 2. 7x 1. 1x 11.5x 0. 4x 2. 8x 2. 2x 4. 0x 27.8x 30.5x 0. 1x 0. 9x 1. 5x 4. 7x 63.2x 1. 1x 6. 7x 2. 9x 0. 7x 63.2x 0. 0x 7.0x 2. 6x Figure 37. Valuation Comparison Source. Capital IQ Slide 25: Page 25 C omparable C ompany Analys is > Web 2.0 S ummary by C ountry C ompany Name United S tates C hina C a na da S outh K orea J a pa n T a iwa n G erma ny Aus tra lia S witzerland India F inla nd United K ingdom Ita ly Hong K ong S weden R us s ia Ma lays ia G rand Total 29 10 9 9 6 3 3 2 1 1 1 1 1 1 1 1 1 80 US D Market C ap ($m) C hina United S tates J a pa n S weden C a na da S outh K orea T a iwa n G erma ny Hong K ong S witzerland R us s ia Ita ly F inla nd Ma lays ia Aus tra lia India United K ingdom G rand Total 56,945.8 5, 465.2 4, 440.9 3, 266.2 2, 538.6 1, 845.8 1, 546.9 318.0 237.5 205.8 193.9 136.8 51.3 36.4 29.4 20.2 5.6 77,284.4 Avg US D Market C ap ($m) C hina S weden J apan T aiwan C ana da Hong K ong S witzerland S outh K orea R us s ia United S ta tes Italy G ermany F inland Mala ys ia India Aus tra lia United K ingdom G rand Total 5, 694. 6 3, 266. 2 740. 1 515. 6 282. 1 237. 5 205. 8 205. 1 193. 9 188. 5 136. 8 106. 0 51. 3 36. 4 20. 2 14. 7 5. 6 966.1 US D L TM Total R ev ($m) C hina United S tates S weden C a na da S outh K orea J a pa n T a iwa n Hong K ong Ita ly G erma ny R us s ia Ma lays ia S witzerla nd India Aus tralia F inla nd United K ingdom G rand Total 4,496.8 3,752.1 1,942.0 992.4 740.1 680.8 404.6 334.2 236.1 171.4 156.3 78.5 63.0 47.7 17.8 4.5 0.0 14,118.5 US D L TM Total E B ITDA ($m) C hina United S ta tes S weden J apa n C a na da S outh K orea T a iwan Italy R us s ia Hong K ong G erma ny Aus tra lia S witzerland United K ingdom F inla nd India Ma la ys ia G rand Total 2,262.8 393.7 274.4 213.0 199.5 133.5 65.0 31.0 20.4 20.0 9.7 4.9 3.4 -2.7 -18.5 -51.2 -85.2 3,473.8 E B ITDA % C hina Aus tra lia T aiwan J apan S outh K orea S weden Italy R us s ia Hong K ong S witzerland G ermany C ana da United S ta tes F inland India United K ingdom Mala ys ia G rand Total 49. 0% 42. 8% 37. 3% 24. 3% 20. 1% 14. 1% 13. 1% 13. 1% 6. 0% 5. 4% -7. 4% -10. 6% -15. 4% NA NA NA NA 11.8% Figure 38. Comparison by Country Source. Capital IQ C omparable C ompany Analys is > Web 2.0 S ummary by E xc hange C ompany Name OT C B B Na s daqG S K OS E T S XV TS E Na s daqG M TS X XT R A OT C P K S E HK AME X AS X GTS M SWX HL S E CM BSE OS E NY S E AIM OM RTS K LS E G rand Total 16 14 8 5 5 4 3 3 3 3 2 2 2 1 1 1 1 1 1 1 1 1 1 80 US D Market C ap ($m) S E HK Na s daqG S TS E OM K OS E NY S E GTS M XT R A OS E TS X Na s daqG M SWX RTS OT C B B CM T S XV AME X HL S E OT C P K K LS E AS X BSE AIM G rand Total 40,705.3 22,230.0 4, 129.4 3, 266.2 1, 799.1 1, 594.3 1, 368.0 318.0 311.5 253.3 237.6 205.8 193.9 166.1 136.8 97.3 79.9 51.3 48.8 36.4 29.4 20.2 5.6 77,284.4 Avg US D Market C ap ($m) S E HK OM NY S E Nas da qG S TS E GTS M OS E K OS E SWX R TS CM XT R A TS X Nas da qG M HLS E AME X K LS E BSE T S XV OT C P K AS X OT C B B AIM G rand Total 13, 568. 4 3, 266. 2 1, 594. 3 1, 587. 9 825. 9 684. 0 311. 5 224. 9 205. 8 193. 9 136. 8 106. 0 84. 4 59. 4 51. 3 40. 0 36. 4 20. 2 19. 5 16. 3 14. 7 10. 4 5. 6 966.1 US D L TM Total R ev ($m) OM S E HK Na s daqG S CM NY S E RTS OS E TS E GTS M Na s daqG M K OS E K LS E SWX XT R A BSE TS X AME X AS X T S XV HL S E OT C B B OT C P K AIM G rand Total 1,942.0 607.9 508.5 236.1 202.3 156.3 116.4 112.9 110.5 97.3 86.1 78.5 63.0 57.1 47.7 46.5 26.4 8.9 8.6 4.5 2.4 0.6 0.0 14,118.5 US D L TM Total E B ITDA ($m) Na s da qG S S E HK OM TS E NY S E K OS E GTS M CM OS E Na s da qG M R TS XT R A AME X AS X SWX AIM TS X T S XV OT C P K HL S E BSE OT C B B K LS E G rand Total 1,918.2 897.1 274.4 187.1 137.9 115.4 65.0 31.0 25.9 25.2 20.4 9.7 6.0 4.9 3.4 -2.7 -7.0 -7.2 -17.9 -18.5 -51.2 -58.3 -85.2 3,473.8 E B ITDA % NY S E AS X S E HK GTS M Nas da qG S TS E OS E K OS E OM CM R TS T S XV Nas da qG M SWX XT R A AME X TS X OT C B B OT C P K AIM BSE HLS E K LS E G rand Total 68. 2% 42. 8% 40. 6% 37. 3% 30. 7% 24. 7% 22. 3% 18. 2% 14. 1% 13. 1% 13. 1% 9. 0% 8. 6% 5. 4% -7. 4% -27. 7% -35. 8% -48. 2% NA NA NA NA NA 11.8% Figure 39. Comparison by Exchange Source. Capital IQ Slide 26: Page 26 F inancing - 2009 (US $ mm) - Top Ten by Type Fin. Amount (Million) C ompany Name S kype P layF is h J ajah Mint S hanghai Dacheng Network P eople Media S uper R ewards K u6 F riends R eunited AdL ink Internet Media Grand Total Type of financing Ac quis ition 2025. 0 400. 0 207. 0 170. 0 80. 0 80. 0 50. 0 44. 0 42. 0 41. 2 3139.2 Fin. Amount (Million) C ompany Name MediaMath E do Interactive K ontera L td. B oku C aus es Imeem S canS cout S B Nation B ubble Motion T ongxue G rand Total Type of financ ing Angel/S eed 16. 6 16. 5 15. 5 13. 0 10. 0 8. 8 8. 1 8. 0 6. 0 6. 0 108.4 Fin. Amount (Million) C ompany Name One Net E ntertainment T he R ubicon P roject T ops y Loomia Myngle C ommunityLend P ros per. com T rans G aming Inc. Grand Total Type of financing Debt financing 10. 0 8. 0 3. 0 1. 5 1. 3 1. 3 1. 0 0. 5 26.5 Fin. Amount (Million) C ompany Name P laydom P opC ap G ames G OO M R adio Marin S oftware gW allet S uperS ecret AdC hina Nurien G o Internet Media Intent Media InXpo G rand Total Type of financ ing S eries A 43. 0 22. 5 16. 0 13. 0 12. 5 10. 0 10. 0 10. 0 10. 0 9. 0 9. 0 165.0 Fin. Amount (Million) C ompany Name G roupon S mith & T inker S ynthas ite K aixin001. com C ollective Media As ter Data S ys tems Livebookings Zynga Offerpal Media T umri Grand Total Type of financing S eries B 30. 0 29. 0 20. 0 20. 0 20. 0 17. 0 16. 0 15. 0 15. 0 15. 0 197.0 Fin. Amount (Million) C ompany Name Zynga P andora Media C haC ha DailyMotion S ezmi T remor Media E ngine Y ard L ithium S ugar Inc. Millennial Media HubS pot G rand Total Type of financ ing S eries C 180. 0 35. 0 30. 0 25. 3 25. 0 20. 0 19. 0 18. 0 16. 0 16. 0 16. 0 400.3 Fin. Amount (Million) C ompany Name F acebook T urbine R ockY ou Y ouku T witter Zoos k E ns equence Ning Zoove QuickP lay Media S endMe Inc. Grand Total Type of financing S eries D 200. 0 50. 0 50. 0 40. 0 35. 7 30. 0 20. 0 15. 0 13. 2 12. 0 12. 0 477.9 Fin. Amount (Million) C ompany Name T witter E mergent G ame T echnologies G lam Media News G ator Mzinga G rand Total Type of financ ing S eries E 100. 0 12. 5 10. 0 10. 0 10. 0 142.5 Figure 40. Top 10 Deals, By Type, 2009 Source. Company reports Slide 27: Page 27 F inanc ing - 2009 (US $ m) F in. Amount (Million) Month J an-09 C ompany Name C haC ha As ter Data S ys tems Yodle AdMob VirtuOz IMVU News Gator DE C A Go Internet Media R ateP oint Nurien L imbo One True Media P lay Hard S ports S undayS ky J ibJ ab Xobni E vernote Ins ideView K ewego Ohai C loudera Motionbox Fliqz S ocialMedia Geni AboutUs Gbox S ports blogs S c rapblog OneS eas on.c om E -G lobal S ports Network Tripwolf mE go Hubdub S nooth C overitL ive TweetDec k B ac kType Identi.c a Meez J an-09 Total F eb-09 Twitter S ynthas ite Tremor Media Offerpal Media Imagini E mergent Game Technologies Outbrain Tvtrip Tongxue Oodle Tributes .c om TextDigger OneS pot Fetc hDog Mixpo Virtual Fairground 7 B illion P eople FamilyL ink.c om Whis tleB ox MobGold Mendeley Outright Tvinci Filtrbox MMO L ife C ake F inancial Invodo fav.or.it F eb-09 Total Mar-09 K aixin001.c om Vidyo B uzznet L endingC lub S endMe Inc. Auditude Ngmoco Glam Media Vis ible Meas ures S uperS ec ret GoViral Greys tripe J ajah C loudera OMGP OP Apture S imulmedia Tynt AnyS ourc e Media P ixazza Tops y S ports C ompos ite DE B it.ly Hunch AdultS pac e Myngle 33Acros s Three Melons Mar-09 Total C hina US A US A US A US A US A United S ta tes US A US A US A UK US A Is rael US A US A US A US A C a nada US A US A US A US A US A US A US A Netherlands US A Argentina S outh Africa US A US A UK US A Is rael F ra nce C hina US A US A US A US A US A C a nada Netherlands US A US A US A C hina UK US A Is rael US A Netherlands US A US A UK 13.3 1. 3 1. 3 1. 2 0. 7 32.3 76.4 20.0 15. 0 12. 5 12.0 12. 0 10.5 10.0 10.0 10. 0 10. 0 8. 8 5. 5 5.0 5. 0 5.0 4. 1 4. 0 3. 9 3. 2 3. 1 3. 0 2.0 2. 0 2. 0 1. 3 1. 3 0.8 1.3 4.3 0.6 0.6 46.1 60.3 43.0 17.0 10.0 23.6 35.7 12.5 2. 0 2. 0 1. 6 1. 4 2. 3 2. 0 4. 0 3. 0 2.9 4. 3 4. 3 4. 2 4. 0 4.0 6. 0 5. 6 12.0 9.0 15.0 13.5 12.5 20.0 18. 0 C ountry US A US A US A US A F ra nce US A US A US A US A US A K orea US A US A US A Is rael US A US A US A US A F ra nce US A US A US A US A US A US A US A US A US A US A US A US A Aus tria US A UK US A C a nada UK US A C a nada US A 9.5 66.2 74.9 112.2 9.0 35. 7 10.0 281.8 35. 7 20. 0 18. 0 15. 0 13. 5 12. 5 12. 0 9.0 6.0 5.6 4.3 4.3 4.2 4.0 4.0 4.0 3.0 2.9 2.3 2.0 2.0 2.0 1.6 1.4 1.3 1.3 1.2 0.7 193.7 20. 0 15. 0 12. 5 12. 0 12. 0 10. 5 10. 0 10. 0 10. 0 10. 0 8.8 5.5 5.0 5.0 5.0 4.1 4.0 3.9 3.2 3.1 3.0 2.0 2.0 2.0 1.3 1.3 0.8 0.6 182.5 1. 0 1. 0 0. 5 0. 3 0. 2 2. 5 1. 2 4. 0 3. 5 3. 5 2. 5 5. 0 5. 0 5. 0 6. 0 6.0 6. 0 6. 0 6. 0 5. 0 6. 5 6.5 6. 2 7.0 8. 0 7. 5 9.0 8.0 10. 0 9.0 10. 0 10. 0 10.0 11.4 10. 0 10.0 Type of financing Angel/S eed Debt financing P IP E S eries A S eries B 17.0 13. 0 12. 5 S eries C 30. 0 S eries D S eries E Grand Total 30. 0 17. 0 13. 0 12. 5 11. 4 10. 0 10. 0 10. 0 10. 0 10. 0 10. 0 9.0 9.0 8.0 8.0 7.5 7.0 6.5 6.5 6.2 6.0 6.0 6.0 6.0 6.0 5.0 5.0 5.0 5.0 4.0 3.5 3.5 2.5 2.5 1.2 1.0 1.0 0.5 0.3 0.2 Slide 28: Page 28 Financ ing - 2009 (US $ m) F in. Amount (Million) Month Apr-09 C ompany Name C ollective Media GOOM R adio Marin S oftware The R ubic on P rojec t FreeW heel C ellufun C onduc tor Inc . S c anS cout B atanga Viximo DoubleTwis t IMS hopping B ooyah S ocialtext Mixercas t S oundC loud TubeMogul Tribal Nova Tripbas e S ocialcas t B randtology S c an & Target J odange Foodis ta Apr-09 Total May-09 Facebook One Net E ntertainment C yberplex Peer39 OpenX Intent Media Imeem E veryZing C onnec tE du B logHer Inc . WonderHill Gis t Fuhu Inc . Azuki S ys tems I L ove R ewards DocuS ign TimeB ridge OL X Medialets C loud E ngines R es onate Networks VoxP op Mo'Minis L oop'd Network May-09 Total J un-09 S ugar Inc. Tumri B oku Wimba Grab Networks AdC hina Goojet S AS E do Interac tive AdMeld Inc . beeTV blueK iwi S oftware S A Nokeena B ubble Motion S ens e Networks Zoos k Gather MojoP ages Taomee Animoto GameG round R ingR evenue C rowdcas t YuMe eR epublik News er L L C C lickFuel Inigral AdE x Media GR OU.P S my6s ens e Yapta OneTXT I L ove R ewards C liqs et Picaboo TodaC ell Glubble AdW hirl L iquidP lanner MOG Mas hL ogic C ommunityL end OneF orty J un-09 Total US A US A US A US A US A C hina F rance US A US A US A F rance US A US A US A US A US A US A C hina US A Is ra el US A US A US A S pain US A US A US A US A US A Is ra el US A US A C a nada US A US A Is ra el Netherla nds US A US A US A US A C a nada US A 0. 2 50.6 0.3 15.3 28.5 71.2 34.0 5.3 0. 5 0.3 1. 0 1. 0 0.5 1. 5 1.0 1. 0 1.0 2. 0 1.8 2. 1 2. 0 2.0 2. 4 2.3 2. 8 2. 5 2. 5 3. 0 2.9 4. 1 3. 5 5. 0 4.4 5. 0 6. 0 6.0 6. 0 5.3 8. 0 8.0 8.0 6.5 6.5 12.0 10. 0 8.5 13. 0 12. 0 15.0 US A C hina C a nada US A UK US A US A US A US A US A US A US A US A US A C a nada US A US A US A US A US A US A US A Is ra el US A 0. 8 13.6 10.0 22.9 35.5 26.9 40.8 16. 0 205.0 1. 5 4. 0 3. 3 2. 0 1.5 5.0 5. 0 6. 0 5.9 5.0 7. 0 6. 8 6.3 8.2 7. 0 8. 8 8. 3 9. 0 10.0 10.0 12.9 10. 5 10. 0 C ountry US A F rance US A US A US A US A US A US A US A US A US A US A US A US A US A G erma ny US A C a nada US A US A S ingapore F rance US A US A 15.6 8.0 1. 3 1. 2 0. 6 49.8 52.5 16.1 12.0 200.0 2. 0 1. 4 1. 4 3. 3 3. 0 2.5 4. 1 4. 7 4. 5 4.5 5. 0 5.0 8. 1 7.5 10.0 10.0 8.0 Type of financ ing Angel/S eed Debt financing PIP E S eries A 16. 0 13. 0 5.0 12. 0 S eries B 20.0 S eries C S eries D Grand Total 20. 0 16. 0 13. 0 13. 0 12. 0 10. 0 10. 0 8.1 7.5 5.0 5.0 4.7 4.5 4.5 4.1 3.3 3.0 2.5 2.0 1.4 1.4 1.3 1.2 0.6 154.0 200. 0 20. 0 12. 9 10. 5 10. 0 9.0 8.8 8.3 8.2 7.0 7.0 6.8 6.3 6.0 5.9 5.0 5.0 5.0 4.0 3.3 2.0 1.5 1.5 0.8 354.6 16. 0 15. 0 13. 0 12. 0 12. 0 10. 0 8.5 8.0 8.0 8.0 6.5 6.5 6.0 6.0 6.0 5.3 5.0 5.0 4.4 4.1 3.5 3.0 2.9 2.8 2.5 2.5 2.4 2.3 2.1 2.0 2.0 2.0 1.8 1.5 1.0 1.0 1.0 1.0 1.0 0.5 0.5 0.3 0.2 205.1 Slide 29: Page 29 F inanc ing - 2009 (US $ m) Fin. Amount (Million) Month J ul-09 C ompany Name P andora Media K ontera L td. Ning Quic kP lay Media B lekko C aus es Outs park C onnectE du Acquia, Inc S B Nation MediaMath Metavers um iMemories Invodo J ambool Quikr India P vt. L td. C haC ha Nexage S tyleC as ter OP E N S ports network TweetDeck B us c a P rotonMedia Akademos iL oop Mobile C omunitae Lat49 Aloqa Thread Tributes .com C oTweet C ellufun C ognitive Matc h L imited C likthrough B ookF res h P eople C apital Mas her Media J ul-09 Total Aug-09 Turbine S mith & Tinker Mint Zoove R ic hR elevance Traffiq MediaMath B ill.c om E do Interac tive InnoC entive OneR iot B alihoo B oxee P olyvore Fanbas e MOG OurS tage Z2L ive K ODA S coreloop R oblox Tremor Media iS oc ket R ights Flow P lis ta C hes s C ube S C VNG R Links ify iS yndica DailyB ooth Aug-09 Total S ep-09 Twitter E ns equence Livebookings Mzinga InXpo J obvite R iot Games NextB io Imeem Vuc lip YuMe B ooyah NeoE dge Alliance Health Networks Unis fair C onduit L abs Mocapay Fwix Vantrix Mas hLogic Greys tripe Loomia FourS quare E duF ire Fluther Trans G aming Inc . OnL ive S ep-09 Total US A UK US A US A US A US A US A US A US A US A US A US A US A US A US A US A US A C a na da US A US A US A US A US A US A C a na da US A 0.6 2.0 16.9 52.3 27.9 23.1 110.0 232.8 0. 6 0. 5 1. 5 1. 4 1. 3 2. 5 2. 0 2. 8 2. 6 3. 0 3. 0 5. 0 4. 0 3. 3 3. 1 6. 0 6. 0 5. 0 9. 0 8. 3 8. 0 8. 0 16. 0 10. 0 20. 0 US A US A US A US A US A US A US A US A US A US A US A US A US A US A US A US A US A US A US A G ermany US A US A US A US A G ermany S outh Africa US A US A US A US A 0. 5 0. 4 0. 0 25.8 12.3 77.6 43.6 63.2 100. 0 1. 3 0. 8 2. 0 1. 5 1. 4 2. 2 2. 0 3. 0 2. 8 3. 0 3. 0 5. 0 5. 0 6. 0 5. 6 8. 5 7. 3 7. 0 7. 0 10. 0 8. 5 12. 5 10. 0 29. 0 14. 1 13. 2 C ountry US A Is ra el US A C a na da US A US A US A US A US A US A US A G ermany US A US A US A India US A US A US A US A UK US A US A US A US A S pa in C a na da G ermany US A US A US A US A UK US A US A US A US A 0. 3 65.0 11.1 36.8 63.0 31.0 50. 0 0. 5 0. 5 1. 0 1. 0 1. 1 1. 0 1. 5 1. 2 1. 2 2. 5 2. 0 1. 7 1. 5 2. 5 4. 0 3. 2 2. 6 4. 0 4. 0 4. 1 4. 0 8. 0 6. 6 6. 3 6. 2 6. 0 5. 0 8. 0 10. 0 8. 3 8. 2 11. 5 Type of financing Angel/S eed 15. 5 15. 0 12. 0 Debt financ ing S eries A S eries B S eries C 35. 0 S eries D S eries E G rand Total 35. 0 15. 5 15. 0 12. 0 11. 5 10. 0 8. 3 8. 2 8. 0 8. 0 6. 6 6. 3 6. 2 6. 0 5. 0 4. 1 4. 0 4. 0 4. 0 4. 0 3. 2 2. 6 2. 5 2. 5 2. 0 1. 7 1. 5 1. 5 1. 2 1. 2 1. 1 1. 0 1. 0 1. 0 0. 5 0. 5 0. 3 206.9 50. 0 29. 0 14. 1 13. 2 12. 5 10. 0 10. 0 8. 5 8. 5 7. 3 7. 0 7. 0 6. 0 5. 6 5. 0 5. 0 3. 0 3. 0 3. 0 2. 8 2. 2 2. 0 2. 0 1. 5 1. 4 1. 3 0. 8 0. 5 0. 4 0. 0 222.4 100. 0 20. 0 16. 0 10. 0 9. 0 8. 3 8. 0 8. 0 6. 0 6. 0 5. 0 5. 0 4. 0 3. 3 3. 1 3. 0 3. 0 2. 8 2. 6 2. 5 2. 0 1. 5 1. 4 1. 3 0. 6 0. 5 Slide 30: Page 30 F inanc ing - 2009 (US $ m) F in. Amount (Million) Month Oc t-09 C ompany Name DailyMotion P opC ap G ames E ngine Yard HubS pot J ive S oftware S pigit Ooyala S c anS cout B ox.net R eality Mobile W aterc ooler Vdopia S ometrics Amie S treet Aurora F eint ViVu F izzbac k Tec hnorati Onehub DataS ync C ommunityLend Hot P otato DailyB ooth L inkedex S tatus Net IngB oo C hango C redit K arma L is tia OneF orty Oc t-09 Total Nov-09 R oc kYou P laydom S ezmi Millennial Media Zynga E vernote C ubeTree Alice.c om E ventbrite P lac ecas t AppNexus Altruik C redit K arma B lekko P layfire S impleG eo P ros per.c om Adfonic S c oopler Nov-09 Total Dec -09 Zynga Youku Zoos k G roupon L ithium gW allet MobGold Movik Networks G owalla G ogii L iveMoc ha S onic Mule kaC hing S eekingAlpha P ageonc e G enius .com C urs e AlikeL is t P owerR eviews S maato S C VNGR Tonc hidot Twilio 5 Minutes J anR ain S toc kTwits Artic le One P artners W his key Media Appolic ious G rapes hot C enter'd W eP ay J inni G lobalMotion Media Dec -09 Total Grand Total US A C hina US A US A US A US A C hina US A US A US A US A US A US A Is ra el US A US A US A US A US A US A US A J a pa n US A C hina US A US A US A US A US A UK US A US A Is ra el US A US A US A US A US A US A US A US A US A US A US A US A US A US A US A UK US A US A UK US A 43. 0 25. 0 16. 0 15. 0 10. 0 8. 0 6. 0 6. 0 5. 0 5. 0 4. 7 2. 5 2. 5 2. 1 1. 5 1. 0 0. 6 0. 5 2.6 C ountry F ra nce US A US A US A US A US A US A US A US A US A US A US A US A US A US A US A UK US A US A US A C a na da US A US A UK C a na da US A C a na da US A US A US A Type of financing Angel/S eed Debt financ ing P IP E S eries A 22. 5 19. 0 16. 0 12. 0 10. 0 10. 0 8. 5 7. 1 6. 5 5. 5 4. 7 4. 0 3. 9 3. 7 3. 0 2. 6 2. 0 1. 3 1. 2 1. 0 1. 0 1. 0 1. 0 0. 9 0. 8 0. 7 0. 5 0. 4 0. 2 4.7 S eries B S eries C 25. 3 S eries D S eries E Grand Total 25. 3 22. 5 19. 0 16. 0 12. 0 10. 0 10. 0 8. 5 7. 1 6. 5 5. 5 4. 7 4. 0 3. 9 3. 7 3. 0 2. 6 2. 0 1. 3 1. 2 1. 0 1. 0 1. 0 1. 0 0. 9 0. 8 0. 7 0. 5 0. 4 0. 2 176.1 50. 0 43. 0 25. 0 16. 0 15. 0 10. 0 8. 0 6. 0 6. 0 5. 0 5. 0 4. 7 2. 5 2. 5 2. 1 1. 5 1. 0 0. 6 0. 5 204.4 180. 0 40. 0 30. 0 30. 0 18. 0 12. 5 12. 0 8. 5 8. 4 8. 2 8. 0 8. 0 7. 5 7. 0 6. 5 6. 5 6. 0 5. 0 4. 9 4. 5 4. 0 4. 0 3. 7 3. 5 3. 3 3. 0 3. 0 2. 5 2. 4 2. 4 1. 9 1. 7 1. 6 1. 0 58.0 26.5 38.8 453.5 40. 0 30. 0 30. 0 18. 0 12. 5 12. 0 8. 5 8. 4 8. 2 8. 0 8. 0 7. 5 7. 0 6. 5 6. 5 6. 0 5. 0 4. 9 4. 5 4. 0 4. 0 3. 7 3. 5 3. 3 3. 0 3. 0 2. 5 2. 4 2. 4 1. 9 1. 7 1. 6 1. 0 449.4 142.5 2863.7 1.0 44.6 56.5 67.4 2.0 50. 0 1.0 52.3 44.0 52.0 180. 0 52.5 2.5 205.1 101.5 730.6 210.9 734.4 76.5 532.3 Figure 41. Financing, 2009 by Company, Country, Round, Month Source. Company reports Slide 31*: Page 31 RELEVANT DISCLOSURES APPLICABLE TO: NONE LIST OF DISCLOSURE TERMS: 1. None applicable. ANALYST CERTIFICATION Each analyst of Research Capital Corporation whose name appears in this report hereby certifies that (i) the recommendations and opinions expressed in this research report accurately reflect the analyst’s personal views and (ii) no part of the research analyst’s compensation was or will be directly or indirectly related to the specific conclusions or recommendations expressed in this research report. I n f o r ma t i o n a b o u t Re s e a r ch C a p i t a l C o r p o r a t i o n ’ s Ra t i n g S y s t e m, t h e d i s t r i b u t i o n o f o u r r e s e a r ch t o cl i e n t s a n d t h e p e r ce n t a g e o f r e c o m me n d a t i o n s wh i c h a r e i n e a c h o f o u r r a t i n g c a t e g o r i e s i s a v a i l a b l e o n o u r we b si t e a t ww w. r e s e a r ch c a p i t a l . c o m. T h e i n f o r ma t i o n c o n t a i n e d i n t h i s r e p o r t h a s b e e n d r a wn f r o m s o u r c e s b e l i e ve d t o b e r e l i a b l e b u t i t s a c cu r a c y o r co mp l e t e n e ss i s n o t g u a r a n t e e d , n o r i n p r o vi d i n g i t d o e s R e s e a r c h Ca p i t a l C o r p o r a t i o n a s s u me a n y r e sp o n si b i l i t y o r l i a b i l i t y . R e s e a r ch C a p i t a l C o r p o r a t i o n , i t s d i r e ct o r s , o f f i c e r s a n d o t h e r e mp l o y e e s ma y , f r o m t i me t o t i me , h a v e p o si t i o n s i n t h e s e cu r i t i e s me n t i o n e d h e r e i n . Co n t e n t s o f t h i s r e p o r t c a n n o t b e r e p r o d u c e d i n wh o l e o r i n p a r t wi t h o u t t h e e xp r e ss e d p e r mi s si o n o f R e se a r ch C a p i t a l C o r p o r a t i o n . ( U . S . I n s t i t u t i o n a l Cl i e n t s — Re s e a r ch C a p i t a l U . S. A . I n c. ( a wh o l l y o wn e d s u b si d i a r y o f R e s e a r c h C a p i t a l Co r p o r a t i o n ) a cc e p t s r e s p o n si b i l i t y f o r t h e c o n t e n t s o f t h i s r e p o r t s u b je c t t o t h e t e r ms & l i mi t a t i o n s s e t o u t a b o v e . F i r ms o r i n s t i t u t i o n s r e ce i vi n g t h i s r e p o r t s h o u l d e f f e ct t r a n s a ct i o n s i n s e c u r i t i e s d i sc u s se d i n t h e r e p o r t t h r o u g h R e s e a r ch C a p i t a l U . S . A . I n c. , a B r o k e r - D e a l e r R e g i s t e r e d wi t h t h e U n i t e d S t a t e s S e cu r i t i e s a n d E xc h a n g e C o m mi s si o n ) . Tor on to 4 16. 8 60. 76 00 M ontr eal 51 4. 39 9. 150 0 V anco u ver 60 4. 66 2. 180 0 C al gar y 40 3. 26 5. 740 0 R egi na 306. 566. 7550 www.researchcapital.com