SOFTWARE & SERVICES
25 AUGUST 2009
WEB 2.O WEEKLY
CONTENT DISTRIBUTIO N ACROSS PLATFO RMS BECOMING KEY
DAVID SHORE, CFA, MBA 416.860.6784
david.shore@researchcapital.com
MY S P AC E B U Y S L E AD IN G F AC E BO O K DE V EL O P E R; F AC E B OO K CR E AT E S T WIT T E R U P DAT E C A PA BIL I T Y
MySpace finally confirmed last week the much-rumoured acquisition of leading Facebook developer iLike. Terms of the deal are believed to be $13.5 million upfront and $6.5 million in retention payouts over time. W ith this acquisition, th MySpace now owns the 14 largest (according to www.appdata.com) Facebook developer – based on the number of monthly active users. Facebook itself announced that Facebook Page owners would be able to automatically update their Twitter status with their Facebook updates. Twitter users have long been able to update their Facebook status with their Tweets. Clearly, the large social network players see the value in allowing their users to cross-pollinate content across the different platforms. A much better August than 2008: Total capital raised in August (so far) is $148.1 million on 17 transactions. The average for August, month-to-date so far, is $8.7 million. This is well ahead of the mere $82.3 million (eight deals, $10.3 million average) raised in August 2008. However, this is down sequentially from June and July, with one week to go in the month. Total capital raised in July on 34 transactions was $190.2 million, averaging $5.6 million, and June was $204.1 million (averaging $5.0 million).
Financing Activity Last Twelve Months
400.0 16.2 350.0 14.6 14.0 300.0 16.0 18.0
12.0 250.0 10.3 9.7 (US$m) 200.0 7.0 150.0 7.1 6.5 6.6 6.2 5.6 5.0 100.0 4.0 6.0 8.7 8.0 10.0 (US$m) 2.0 0.0 Aug-08 Sep-08 Oct-08 Nov-08 Dec-08 Jan-09 Feb-09 Total Mar-09 Average Apr-09 May-09 Jun-09 Jul-09 Aug-09
7.0
50.0
0.0
*May-09 includes $200m FB investment
A strong price performance week: Most companies in our universe had strong stock price performances over the past week (for stocks with prices greater than $1) (Figure 6), with 37 companies showing positive returns on the week – reversing the prior weeks decline. Frogster (XTRA:FRG) led the group with a 19.6% return, while Ynk Korea (KOSE:A023770) had the worst return, dropping 14.6% in the week.
This report has been created b y Anal ysts that are emplo yed b y Research Capital Corporation, a Canadian Investment Dealer. For further disclosures, please see last page of this report.
T o ro n t o 4 1 6 . 8 6 0 . 7 6 0 0 Montreal 514.399.1500 w w w . r e s e a rc h c a p i t a l . c o m Vancouver 604.662.1800 Calgary 403.265.7400 Regina 306.566.7550
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THE WEB 2.0 UNIVERSE Ninety-one public Web 2.0 companies: Our W eb 2.0 universe contains 91 companies, with a combined market cap of ~$65 billion (Figure 1). The median market cap for the group is ~$65 million, with average trailing revenue of ~$160 million (median $57 million). The companies are also generally profitable, with a median EBITDA margin of 13.1%. On a valuation basis, the overall average is 5.0x trailing revenue (median 1.9x) and 11.9x trailing EBITDA (median 9.4x). Eighteen 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 s ociated Media Holdings Inc. B igs tring C orp. B eta wave C orporation B eyond C ommerce, Inc. B right T hings plc B roa dW ebAs ia Inc. C DC C orp. C hangyou. com L imited C hina G a teway C orporation C hines e G amer Interna tiona l C LIC K E R Inc. C ornerW orld C orpora tion C yberplex Inc. DADA S pA DXN Holdings B hd Dibz International, Inc. 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 a nada , Inc. F rogs ter Interactive P ictures AG G ama nia Digita l E ntertainment C o., Ltd. G ameOn C o Ltd. 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. IAS E nergy, Inc. is eemedia Inc. J umbuck E nterta inment P ty Ltd. K AB Dis tribution Inc. K ings oft C o. Ltd. Lingo Media C orporation LiveW orld Inc. LookS mart, Ltd. Magnitude Information S ys tems Inc. Mixi, Inc. Modern T imes G roup Mtg AB MO K O .mobi Limited Myriad G roup AG NE O W IZ G ames C orpora tion NetDragon W ebS oft, Inc. Neteas e. com Inc. NeuLion Incorporated NeXplore C orporation Ngi G roup Inc. Northgate T echnologies L imited 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 Interactive E nterta inment Ltd. S hutterfly, Inc. S K C ommunications C o., Ltd. S NAP Interactive, Inc. S NM G loba l Holdings S ocial Media V enures , Inc. S ocialwis e, Inc. S ohu. com Inc. S park Networks , Inc. S pectrumDNA, Inc. T encent Holdings Ltd. T he P arent C ompany T he9 Limited T heS treet. com, Inc. T ota l S port O nline AS T ree.C om, Inc. Unis erve C ommunica tions C orp. United O nline Inc. UOMO Media, Inc V alueC lick Inc. V OIS , Inc. W ebzen Inc. W izzard S oftwa re C orporation W orlds . com Inc. W oozyF ly, Inc. W ynds torm C orpora tion XING AG Y eda ngO nline C orp. Y nk K orea Inc. High Low Average Median
L TM as of Ticker
6/30/2009 3/31/2009 3/31/2009 6/30/2007 6/30/2009 6/30/2009 6/30/2009 9/30/2008 9/30/2008 6/30/2009 6/30/2009 9/30/2008 3/31/2009 5/31/2009 4/30/2009 6/30/2009 6/30/2009 5/31/2009 NA 6/30/2009 5/31/2009 3/31/2009 12/31/2008 3/31/2009 6/30/2009 12/31/2008 6/30/2009 6/30/2009 3/31/2009 6/30/2009 3/31/2009 3/31/2009 6/30/2009 3/31/2009 3/31/2009 6/30/2009 1/31/2009 3/31/2009 12/31/2008 6/30/2009 3/31/2009 3/31/2009 6/30/2009 6/30/2009 3/31/2009 6/30/2009 6/30/2009 12/31/2008 12/31/2008 12/31/2008 3/31/2009 6/30/2009 6/30/2009 6/30/2008 6/30/2009 6/30/2009 6/30/2009 6/30/2009 6/30/2009 6/30/2009 6/30/2009 12/31/2007 3/31/2009 6/30/2009 12/31/2008 6/30/2009 9/30/2008 12/31/2008 6/30/2009 6/30/2009 6/30/2009 6/30/2009 6/30/2009 8/2/2008 12/31/2008 3/31/2009 3/31/2006 6/30/2009 2/28/2009 6/30/2009 1/31/2009 6/30/2009 3/31/2009 6/30/2009 6/30/2009 3/31/2009 6/30/2009 NA 6/30/2009 12/31/2007 3/31/2009 AC LZ A052790 3838 AS MH BS GC B W AV B Y OC AIM: B G T BWBA C HIN. A C Y OU CGWY G T S M: 3083 C LK Z CWR L T S X :C X C M: DA DX N DIB Z DG LP DG T W DP DM A041060 E XT I T S X :F MN FRG 6180 3812 G E O 1V GA G IG M GR VY T S E : 3632 3765 A047080 IAC I IAS A. E IE E AS X :J MB T S X :K AB 3888 T S X V :LM LVW D L OO K MAG Y 2121 MT G B MK B MY R N A095660 777 NT E S T S X :NLN NX P C 2497 590057 OT E X OP W V PWRD T S X V :P N QP S A R BCI S NDA S FLY A066270 S TVI S NMN S MV I S C LW S O HU L OV S P XA 700 K IDS . Q NC T Y TS CM T OS O TR E E T S X V :US S UNT D UO MO V C LK V O IS W ZE N W ZE W DDD W ZY F W Y ND O 1B C A052770 A023770
E xc hange
OT C B B K OS E TS E OT C P K 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 OT C P K GTS M OT C B B OT C B B TS X CM K LS E OT C P K 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 OT C B B T S XV AS X TS X S E HK T S XV OT C P K Na s daqG M OT C B B TS E OM AS X 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 P K OT C P K OT C B B Na s daqG S AME X OT C B B S E HK OT C P K Na s daqG S Na s daqG M O T C NO Na s daqG M T S XV Na s daqG S OT C B B Na s daqG S OT C B B Na s daqG M AME X OT C B B OT C B B OT C P K XT R A K OS E K OS E
Trading C urrency HQ
US D KR W JPY US D US D US D US D GBP US D US D US D US D TWD US D US D C AD E UR MY R US D 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 US D C AD AUD C AD HK D C AD US D US D US D JPY SEK AUD 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 US D US D HK D US D US D US D NO K US D C AD US D US D US D US D US D US D US D US D US D E UR KR W KR W United S ta tes S outh K orea J a pan United S ta tes United S ta tes United S ta tes United S ta tes United K ingdom United S ta tes Hong K ong C hina United S ta tes T aiwa n United S ta tes United S ta tes C anada Italy Ma la ys ia United S ta tes United S ta tes United S ta tes United S ta tes S outh K orea United S ta tes United S ta tes G ermany T aiwa n J a pan F inland C hina T aiwa n S outh K orea J a pan J a pan S outh K orea United S ta tes C anada C anada Aus tralia C anada C hina C anada United S ta tes United S ta tes United S ta tes J a pan S weden Aus tralia S witzerland S outh K orea C hina C hina C anada United S ta tes J a pan India C anada United S ta tes C hina C anada United S ta tes R us s ia C hina United S ta tes S outh K orea United S ta tes United S ta tes United S ta tes United S ta tes C hina United S ta tes United S ta tes C hina United S ta tes C hina United S ta tes Norway United S ta tes C anada United S ta tes C anada United S ta tes United S ta tes S outh K orea United S ta tes United S ta tes United S ta tes United S ta tes G ermany S outh K orea S outh K orea
C urrent P rice
0. 57 19,150 50,400 0. 01 0. 02 0. 08 0. 18 0. 01 0. 23 2. 63 38. 08 0. 02 394 0. 01 0. 06 2 6. 38 0. 53 0. 00 0. 06 1. 40 0. 39 860 0. 08 1. 32 16. 75 50. 30 104,700 0. 05 8 4. 73 2. 39 8,540 243,000 3,795 19. 04 0. 15 0. 05 0. 38 1 9 1. 12 0. 05 1. 28 0. 01 614000. 00 310. 00 0. 07 4. 50 29650. 00 7 42. 28 1. 10 1 32400. 00 39. 40 35. 95 2. 86 39. 01 1. 67 2 1. 05 48. 75 15. 15 9310. 00 0 0. 00 0 0. 60 64. 52 2 0 120 0. 02 8. 44 2. 31 0. 03 8. 61 0. 05 7. 40 0 11 0 2. 82 0. 45 0. 11 0. 15 0. 10 27. 49 8,550 4,075
US D Market C ap ($m)
15. 8 133. 1 29. 0 0.6 1.0 2.3 8.3 4.0 19. 5 278. 7 2,094. 4 0.3 1,009. 5 0.4 5.3 97. 1 148. 1 34. 8 0.0 4.6 38. 3 20. 9 50. 2 3.6 64. 5 60. 6 233. 0 107. 0 64. 3 1,754. 9 257. 9 66. 4 2,021. 1 294. 3 67. 0 2,520. 9 10. 5 2.4 15. 4 83. 4 1,214. 6 13. 0 1.5 21. 9 3.0 1,000. 3 2,901. 8 5.2 90. 4 503. 0 452. 8 5,472. 2 116. 9 33. 5 42. 4 28. 3 2,018. 6 238. 2 1,918. 6 53. 2 19. 1 145. 7 3,255. 0 385. 7 314. 4 4.3 0.0 0.0 26. 6 2,473. 3 44. 2 11. 0 28, 087.7 0.5 215. 3 70. 7 0.1 93. 0 1.0 620. 4 12. 9 937. 8 5.0 33. 4 22. 7 5.7 2.6 1.8 207. 5 103. 3 17. 5 28, 087.7 0.0 720.6 65. 5
US D L TM Total R ev ($m)
4. 4 93. 1 65. 4 0. 1 0. 1 9. 4 11. 7 0. 3 0. 0 361.6 241.2 6. 7 56. 3 2. 5 3. 9 91. 0 236.5 76. 5 NA 1. 0 NM 0. 8 14. 8 NM 5. 3 3. 3 139.1 77. 5 6. 1 198.5 183.6 46. 1 147.5 109.0 55. 6 1, 392. 3 0. 0 1. 6 15. 0 68. 8 129.1 1. 0 10. 6 56. 8 0. 1 129.3 1, 950. 0 1. 2 40. 0 199.5 87. 0 472.2 21. 5 0. 7 87. 9 81. 9 785.7 191.7 255.6 21. 3 0. 2 150.9 570.3 218.6 185.5 3. 5 2. 0 0. 1 0. 0 485.1 50. 5 0. 1 1, 391. 1 112.0 250.5 67. 0 2. 2 216.6 24. 3 949.8 0. 6 563.6 0. 0 22. 3 5. 3 0. 0 NM NA 57. 5 55. 2 10. 6 1,950. 0 0. 0 160.4 56.8
US D L TM Total E B ITDA ($m)
(3.7) 20. 2 4.1 (2.3) (1.5) (12. 6) (12. 8) (1.9) (4.6) 25. 1 147.2 (6.6) 31. 6 (1.2) NM 9.8 31. 1 11. 0 NM (1.4) (2.5) (3.7) (3.5) NM (5.1) (6.3) 24. 6 19. 0 (15. 7) 124.1 NM 12. 7 88. 6 19. 6 (14. 9) 52. 7 (0.8) (5.1) 5.6 4.0 52. 0 (1.6) (0.1) (4.4) (3.1) 43. 7 299.6 (2.5) 0.8 53. 6 34. 4 297.3 (13. 0) (6.2) 6.5 (40. 9) 205.1 5.3 142.1 2.3 (10. 6) 19. 7 261.0 27. 3 12. 1 0.9 (0.7) (0.1) (5.6) 209.6 10. 8 (2.5) 685.6 (13. 5) 85. 4 1.9 (1.1) (0.7) 0.1 203.2 (0.5) 99. 0 (1.1) 2.2 (4.5) (0.8) NM NM 16. 6 11. 9 (0.8) 685. 6 -40.9 38.1 2. 3
E B ITDA %
-83. 3% 21. 7% 6.3% NM NM NM NM NM NM 6.9% 61. 0% -98. 9% 56. 0% -45. 8% NM 10. 8% 13. 1% 14. 4% NM NM NM NM -23. 6% NM -95. 2% NM 17. 7% 24. 5% NM 62. 5% NM 27. 5% 60. 1% 18. 0% -26. 8% 3.8% NM NM 37. 2% 5.8% 40. 3% NM -1.2% -7.8% NM 33. 8% 15. 4% NM 1.9% 26. 8% 39. 5% 63. 0% -60. 3% NM 7.4% -50. 0% 26. 1% 2.8% 55. 6% 11. 0% NM 13. 1% 45. 8% 12. 5% 6.5% 27. 0% -34. 8% -60. 6% NM 43. 2% 21. 3% NM 49. 3% -12. 0% 34. 1% 2.9% -50. 6% -0.3% 0.2% 21. 4% -78. 2% 17. 6% NM 9.9% -84. 9% NM NM NM 28. 8% 21. 6% -7.6% 63. 0% -98. 9% 5.0% 13. 1%
TE V/L TM R evenue
4. 7x 1. 1x 15.6x 32.5x 1. 2x 14.6x 0. 8x 7. 5x 0. 0x 16.7x 0. 2x 4. 0x 0. 8x 0. 8x 0. 6x 6. 7x 28.3x 3. 5x 10.6x 17.9x 1. 5x 0. 5x 9. 9x 1. 0x 12.9x 2. 4x 0. 9x 0. 6x 0. 9x 0. 7x 9. 4x 12.4x 0. 0x 6. 9x 1. 8x 3. 3x 2. 5x 2. 5x 3. 8x 5. 0x 0. 3x 2. 6x 0. 7x 0. 5x 2. 4x 0. 0x 1. 5x 1. 7x 0. 8x 1. 1x 4. 5x 4. 1x 0. 8x 22.1x 0. 2x 0. 1x 4. 6x 0. 5x 0. 2x 0. 9x 20.8x 1. 4x 4. 5x 2. 7x 2. 0x 32.5x 0. 0x 5.0x 1. 9x
TE V/L TM E B ITDA
5. 1x 10. 9x 12. 4x 29. 9x 7. 8x 6. 3x 4. 5x 8. 5x 1. 9x 21. 5x 13. 6x 14. 8x 1. 8x 23. 4x 20. 3x 11. 6x 9. 2x 9. 5x 10. 0x 24. 4x 1. 0x 21. 9x 0. 2x 11. 8x 26. 1x 2. 9x 9. 4x 3. 9x 44. 9x 3. 2x 4. 4x 8. 1x 9. 4x 9. 4x 44. 9x 0. 2x 11.9x 9. 4x
E mployees
11 NA NA 3 4 45 43 9 46 2, 227 628 37 NA 22 NA NA NA NA NA 7 3 NA NA 2 NA NA NA NA 108 1, 570 751 469 NA NA NA 3, 200 NA NA 72 NA 2, 271 NA NA 90 14 NA 2, 969 NA 405 NA 2, 426 3, 109 237 NA NA NA NA NA 2, 096 NA 74 NA 3, 124 514 NA 11 33 NA NA 3, 197 183 7 6, 194 347 1, 626 310 16 700 NA 1, 469 NA 1, 189 4 NA 110 1 NA NA 174 NA NA 6, 194 1 860 376
Figure 1. Web 2.0 Universe Summary Source. Capital IQ
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C A P I T A L M A R K E T S A C T I V I T Y (M & A A N D F I N A N C I N G ) Total capital raised in August (so far) is $148.1 million: Online gaming company Turbine, Inc. raised $50 million in August – the largest transaction in August. Mint, a vertical community site (offering web-based solutions for financial management), was a distant second raising $14.1 million. Total capital raised in July on 34 transactions was $190.2 million, averaging $5.6 million, and June was $204.1 million (averaging $5.0 million). The average for August, month-todate so far, is $8.7 million.
Financing Activity Last Twelve Months
400.0 16.2 350.0 14.6 14.0 300.0 16.0 18.0
12.0 250.0 10.3 9.7 (US$m) 200.0 7.0 150.0 7.1 6.5 6.6 6.2 5.6 5.0 100.0 4.0 6.0 8.7 8.0 10.0 (US$m) 2.0 0.0 Aug-08 Sep-08 Oct-08 Nov-08 Dec-08 Jan-09 Feb-09 Total Mar-09 Average Apr-09 May-09 Jun-09 Jul-09 Aug-09
7.0
50.0
0.0
*May-09 includes $200m FB investment
Figure 2. Financings, Last Twelve Months Source. Company reports
(US$m) 10.0 20.0 30.0 40.0 50.0 60.0 70.0 80.0 90.0 0.0
Turbine, Inc. $50 million raise largest in August: On the capital raise front, Turbine, Inc. raised $50 million, the largest transaction so far in August. Mint was a distant second securing a $14.1 million round. Closely behind was RichRelevance raising $12.5 million. Of the total 17 transactions thus far, 12 were below $10 million each, bringing the total capital raised for August to $148.1 million. In addition, Friends Reunited was acquired for $42 million and MySpace bought iLike for $20 million. For additional details on financings, see Figures 23 and 24 (at end of note).
Figure 3. Capital Market Activity, Last Three Months Source. Company reports
Financing & M/A Summary - Last Three Months
People Media Super Rewards Turbine Friends Reunited AdLink Internet Media Pandora Media iLike xoopit MediaMath Edo Interactive Sugar Inc. Kontera Ltd. Ning Tumri Mint Boku RichRelevance QuickPlay Media Grab Networks Wimba Traffiq AdChina Causes Goojet SAS Bill.com Outspark ConnectEdu Acquia, Inc beeTV AdMeld Inc. SBNation InnoCentive blueKiwi Software SA Nokeena Metaversum iMemories Zoosk Boxee Bubble Motion Invodo Sense Networks Polyvore Gather Taomee Jambool MojoPages Animoto Quikr India Pvt. Ltd. GameGround StyleCaster Nexage OPEN Sports network RingRevenue TweetDeck OurStage Crowdcast Z2Live KODA YuMe Scoreloop eRepublik Busca ClickFuel ProtonMedia Newser LLC Akademos Inigral AdEx Media Roblox GROU.PS Yapta OneTXT iLoop Mobile my6sense I Love Rewards Comunitae Lat49 Aloqa Cliqset ChessCube Tributes.com CoTweet Cognitive Match Limited TodaCell Glubble Cellufun Picaboo LiquidPlanner AdWhirl Clikthrough People Capital BookFresh MashLogic iSyndica Masher Media Jaxtr Gigpark Jul-09 Jun-09 Aug-09
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Ad Netw ork remains the most active sector in dollars raised: Following recent trends, Ad Networks as a sector saw the most activity in dollars raised ($126.4 million) and number of transactions (13), followed by the Social Network sector also with 13 transactions, raising $105.2 million (Figure 4).
Capital Market Activity by Sector - Last Three Months
140.0
120.0
100.0
(US$m)
80.0
60.0
126.4 105.2
40.0
80.0 69.9 64.2 64.0 58.0 32.6
20.0
24.3
24.0
22.3
19.3 Vertical Communities
19.1 Media
13.0 Mobile Payment
12.5 Comment/Reputation
12.0 Collaboration
10.7 Online Learning
0.0 Online Dating Gaming Mobile Enterprise Music Infrastructure Blog Social Networks Virtual World Ad Network Video
7.3 Crowdsourced Content
5.0 Virtual Goods
5.0 Search
4.1 Classified
3.2 Microblog
3.0 Mobile Ad
1.0 Publishing
1.0 Analytics
0.5 Online Lending
0.5 Online Calendar 1
0.0 SMS/Voice 0
# companies
13 13 1 5 7 10 3 5 5 2 7 3 4 1
1
2
2
1
1
1
1
1
2
1
1
1
Figure 4. Capital Market Activity, by Sector, Last Three Months Source. Company reports
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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 continue to outpace NASDAQ recovery: Our W eb 2.0 index (market-cap weighted) essentially mirrored the performance of the NASDAQ composite index from mid-2008 until earlier this year. However, the index has recently had a much stronger recovery relative to the NASDAQ index (Figure 5).
Web 2.0 Index Price Performance
140
120
100
80
60
40
20
0 9/8/2008 2/9/2009 3/9/2009 4/6/2009 5/4/2009 10/20/2008 11/17/2008 12/15/2008 12/29/2008 8/25/2008 9/22/2008 1/12/2009 1/26/2009 2/23/2009 3/23/2009 4/20/2009 5/18/2009 6/1/2009 6/15/2009 6/29/2009 7/13/2009 7/27/2009 8/10/2009 8/24/2009 10/6/2008 11/3/2008 12/1/2008
^COMP - Share Pricing
Figure 5. Web 2.0 Price Performance Source. Capital IQ
Index: Web 2.0 (Market Cap)
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A strong price performance week: Most companies in our universe had strong stock price performances over the past week (for stocks with prices greater than $1) (Figure 6), with 37 companies showing positive returns on the week – reversing the prior weeks decline. Frogster (XTRA:FRG) led the group with a 19.6% return, while Ynk Korea (KOSE:A023770) had the worst return, dropping 14.6% in the week.
Frogs ter Interactiv e Pictures A G G ravity Co., Ltd Northgate Technologies Limited Lingo Media Corporation NetDragon WebS of t, Inc. Fluid Mus ic Canada , Inc. Perfect World Co., Ltd. G ree, Inc. DigitalTow n, Inc. S ohu.com Inc. Modern Times G roup Mtg A B V alueClick Inc. S handa Interactive Entertainment Ltd. G igaMedia Ltd. Quepas a Corp. LookS mart, Ltd. My riad Group A G Neteas e.com Inc. Eolith Co. Ltd. DA DA S pA PNI Digital Media Inc. Tencent Holdings Ltd. Webz en Inc. CDC Corp. IA C/InterA ctiveCorp. K ings of t Co. Ltd. S hutterf ly , Inc. TheS treet.com, Inc. Openw ave S y s tems Inc. Changy ou.com Limited The9 Limited Mix i, Inc. G ameOn Co Ltd. A Q Interactiv e, Inc. S park Netw orks , Inc. United Online Inc. Giant Interactive G roup, Inc. NeuLion Incorporated XING A G Ngi G roup Inc. Cy berplex Inc. Y edangOnline Corp. Tree.Com, Inc. Chines e Gamer International S K Communications Co., Ltd. Open Tex t Corp. NEOWIZ Games Corporation HanbitS of t, Inc. A ctoz S of t Co., Ltd. Gamania Digital Entertainment Co., Y nk K orea Inc. -20.0%
Figure 6. 1-Week Price Performance Source. Capital IQ
1 Week P rice P erformance
12.0% 12.0% 10.0% 14.9%
19.6% 18.9%
-14.6%
-10.1% -11.3%
-1.2% -3.0% -3.6% -3.7% -4.4% -5.5% -5.8% -6.2% -8.0%
7.9% 7.7% 7.7% 7.7% 7.6% 7.5% 7.4% 7.3% 7.1% 6.7% 5.6% 5.1% 4.9% 4.8% 4.4% 4.3% 3.7% 3.5% 3.5% 2.7% 2.7% 2.7% 2.1% 2.0% 1.9% 1.7% 1.7% 1.6% 1.3% 1.2% 0.9% 0.0% 0.0%
-15.0%
-10.0%
-5.0%
0.0%
5.0%
10.0%
15.0%
20.0%
25.0%
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INDUSTRY NEWS (PARTNERSHIPS, FINANCIAL RESULTS, NEW PRODUCTS)
K ey Developments
C ompany
United Online Inc. (Nas daqGS : UNTD)
Headline
United O nline Inc. Announces E xecutive P romotions
Notes
O n Augus t 14, 2009, F rederic A. R anda ll, J r. , who ha s s erved a s the E xecutive V ice P res ident, G enera l C ouns el and S ecreta ry of United O nline Inc. , wa s elected to the pos ition of E xecutive V ice P res ident and C hief S trategy Officer, a newly-created executive officer pos ition of the company, effective Augus t 15, 2009. In his new role, Mr. R a nda ll will focus on matters related to s trategic planning and a cquis itions . C harles B . Ammann, who ha s s erved as the compa ny's S enior V ice P res ident, Deputy G enera l C ouns el a nd As s is tant S ecretary, wa s promoted to the pos ition of E xecutive V ice P res ident, G enera l C ouns el a nd S ecreta ry of the compa ny, effective Augus t 15, 2009. It is learnt that, S NM G loba l Holdings continues its ques t to s ecure funding to pa y down debt a nd continue with the development of infras tructure a nd s eeking a cquis itions . T he compa ny is a ls o exploring expa ns ion into other indus tries tha t will complement as well as divers ify their Media –E ntertainment/S ports content development, delivery a nd dis tribution model. Digita lP os t Interactive Inc. reported earnings res ults for the s econd quarter a nd s ix months ended J une 30, 2009. T ota l revenue for s econdqua rter 2009 ros e more tha n 161% to $376, 400, from $144,200 in s econd-quarter 2008. T he increa s e was driven by more tha n 211% growth in s ubs criptions revenue, which was due to the compa ny's pa rtners hip with K iddie K andids , a nd more than 126% growth in profes s iona l s ervices revenue. C a s h us ed in opera tions improved s ignifica ntly to $2, 700 for s econd-qua rter 2009 a s compared to $460, 800 for the s a me period la s t yea r. T he improvement reflects the compa ny's ongoing effort to s trea mline opera tions while driving more revenue through the growth of recurring s ubs criptions a nd through the profes s iona l s ervices contracts that have been a warded. Net los s for s econd-quarter 2009 narrowed to $424,200 from a net los s of $1. 5 million in s econd-qua rter 2008. F or the firs t s ix months of 2009, net cas h us ed by operating activities declined to $64, 900 from $873,000 for the firs t s ix months of 2008. T ota l revenue was $687, 400 compared to $195, 500 in the precious yea r period.
S NM G lobal Holdings (OTC PK : S NMN)
S NM G lobal S eeking Acquis itions
DigitalP os t Interac tive, Inc . (OTC B B : DG L P )
Digita lP os t Interactive Inc. R eports E a rnings R es ults for the S econd Qua rter a nd S ix Months E nded J une 30, 2009
C DC C orp. (Nas daqG S : C HIN.A)
C DC C orp. R eports Una udited C ons olidated E a rnings R es ults for the S econd Q ua rter and S ix Months E nded J une 30, 2009
C DC C orp. reported una udited cons olida ted ea rnings res ults for the s econd quarter a nd s ix months ended J une 30, 2009. F or the quarter, the company reported net income a ttributa ble to controlling interes t was $3, 249,000 or $0. 03 ba s ic a nd diluted ea rnings per s ha re on revenue of $81, 654, 000 compared to net los s attributable to controlling interes t of $9,996, 000 or $0.09 ba s ic and diluted los s per s hare on revenue of $111,040, 000 for the s a me period a yea r a go. Income from continuing opera tions was $3,409,000 or $0. 03 ba s ic a nd diluted earnings per s hare from continuing opera tions compa red to los s from continuing opera tions of $7, 450, 000 or $0. 07 bas ic a nd diluted los s per s ha re from continuing operations for the s a me period a year a go. Income before income ta xes was $4,662,000 compa red to los s before income ta xes of $6,978,000 for the s ame period a yea r ago. Adjus ted E B IT DA from continuing opera tions was $12, 477, 000 compared to $9, 973, 000 for the s a me period a year a go. Net ca s h provided by operating a ctivities wa s $11,168,000 and ca pital s pend in purcha s e of property, plant & equipment was $391,000 compared to net ca s h provided by opera ting a ctivities of $5,573,000 and ca pita l s pend in purcha s e Myria d G roup AG announced that it ha s been s elected by T -Mobile C zech R epublic to provide the US S D platform for its cus tomer ca re s ervice. T he s olution exploits the s trengths of the Myriad S ervices P la tform to a llow the operator to offer US S D as a s imple trigger for s ubs criber s elf s ervice, s o helping to reduce cus tomer churn. T he s olution is a s elf-s ervice s ys tem tha t a llows cus tomers to quickly acces s s ervices and informa tion on their mobile hands et and cha nge their s ettings . T he s olution improves cus tomer s a tis fa ction, reducing the need for cus tomer s ervice reques ts a nd can be upgra ded to s upport a dva nced s elf s ervices us ing gra phical interfa ces in the future. F or T -Mobile the us e of US S D provides a n intuitive cha nnel which a llows a ny cus tomer to immediately s elf-provis ion cus tomer ca re. G ama nia Digita l E ntertainment C o. L td. reported a udited cons olida ted fina ncial res ults for the firs t s ix months ended J une 30, 2009. F or the qua rter, the compa ny reported cons olidated operating revenue of T W D 2, 671, 670, 000, opera ting income of T W D 384, 453, 000, net income of T W D 291, 943, 000 a nd earnings per s ha re (E P S ) of T W D 2. 00. B enefited from the product divers ification s tra tegy, the operating revenue s trongly increa s ed 42. 37% yea r-over-year for the firs t ha lf year 2009. T he operating revenue of the parent company a ls o performed quite well a nd grew 24.66% yea r-over-year due to the contribution from three flags hip titles . L ingo Media C orpora tion, Annual G eneral Meeting, Aug 18, 2009, a t 11: 00 E a s tern Da ylight. L ocation: W eirF oulds L LP , 130 K ing S treet W es t, S uite 1500, T oronto, ON M5X 1J 5, Onta rio, C anada. Agenda : T o receive the audited financia l s tatements for the fis ca l year ended December 31, 2008 and the report of the Auditors thereon the compa ny; to elect the directors of the company; to appoint C ollins B a rrow T oronto L LP as auditors for the ens uing year a nd to a uthorize the directors to fix their remunera tion; to a pprove a n ordinary res olution of dis interes ted s hareholders a uthorizing the a mendment of the company's s tock incentive pla n to increas e the ma ximum number of s hares is s uable under the P la n; and to trans a ct s uch other bus ines s a s may properly come before the Meeting . G iant Interactive G roup Inc. reported unaudited cons olidated financia l res ults for the s econd quarter ended J une 30, 2009. F or the qua rter, the company reported net revenue was R MB 364.1 million compa red to R MB 373. 5 million in the firs t qua rter 2009 and R MB 504. 8 million in the s econd qua rter 2008. Net income a ttributa ble to the company's s hareholders wa s R MB 231. 9 million compared to R MB 231.9 million in the firs t qua rter 2009 and R MB 350. 6 million in the s econd qua rter 2008. T he year-over-year decrea s e is attributable to the decreas e in net revenue. Non-G AAP net income a ttributa ble to the compa ny's s hareholders excluding non-ca s h s ha re-ba s ed compens ation was R MB 239. 8 million compared to R MB 240.2 million in the firs t qua rter 2009 a nd R MB 362. 5 million in the s econd qua rter 2008. B as ic a nd diluted nonG AAP ea rnings excluding non-cas h s ha re-ba s ed compens ation per ADS were R MB 1.06 and R MB 1. 03, res pectively, compa red to ba s ic a nd diluted non-G AAP ea rnings per ADS of R MB 1. 50 and R MB 1. 45, res pectively, for the s econd quarter 2008, and ba s ic and diluted nonG AAP ea rnings per ADS of R MB 1.06 and R MB 1. 03, res pectively, for the firs t qua rter 2009. T he compa ny reported income from operations o IAC /InterActiveC orp. a nnounced that interactive entertainment veteran and lifetime a chievement award recipient L ouis C as tle ha s joined IAC 's Ins ta ntAction Holdings as its new C E O. Under C as tle's lea ders hip, Ins tantAction will purs ue a n expa nded bus ines s s trategy that will build upon the vis ion of true, frictionles s web publis hing, and will more effectively connect developers directly to cons umers while crea ting a ll new IP a cros s multiple ga ming pla tforms a nd genres . C as tle, a 26-yea r gaming indus try veteran, joins the online ga ming leader to help s pearhea d the tra ns ition of ma ins tream video ga mes to the web. C as tle s ucceeds former C E O J os h W illiams who will as s ume the role of fellow and chief technologis t at Ins tantAction.
Myriad G roup AG (S WX: MYR N)
Myria d G roup AG S igns C ontra ct with T -Mobile C zech R epublic to P rovide the US S D P latform
Gamania Digital E ntertainment C o., L td. (GTS M: 6180)
G a ma nia Digita l E nterta inment C o. Ltd. R eports Audited C ons olida ted F ina ncia l R es ults for the F irs t S ix Months E nded J une 30, 2009
L ingo Media C orporation (TS XV: L M)
Lingo Media C orporation, Annua l G enera l Meeting, Aug 18, 2009
Giant Interactive G roup, Inc . (NYS E : GA)
G ia nt Intera ctive G roup Inc. R eports Una udited C ons olida ted F ina ncia l R es ults for the S econd Q ua rter E nded J une 30, 2009 ; P rovides R evenue G uidance for the T hird Q ua rter 2009
IAC /InterActiveC orp. (Nas daqGS : IAC I)
IAC /InterActiveC orp. Appoints L ouis C as tle a s C E O
UOMO Media, Inc (OTC B B : UOMO)
UO MO Media, Inc. R eports Audited R evenue R es ults for UOMO Media, Inc. reported a udited revenue res ults for the year ended April 30, 2009. F or the period, the company reported revenue of the Y ea r E nded April 30, 2009 $858, 137 s etting a record a s the highes t in the company's his tory with a corres ponding growth in tota l a s s ets .
Page 9
S oc ialwis e, Inc . (OTC B B : S C L W)
S ocia lwis e Inc. Appoints Mark Miller to the C ompany's B oard of Advis ors
S ocia lwis e Inc. a nnounced the appointment of Ma rk Miller, former S enior V ice P res ident of DC S hoes and action s ports indus try vetera n to the company's B oa rd of Advis ors . In this role, he will us e his extens ive network of online mercha nts , Actions S ports athletes , a nd indus try connections to pos ition B illMyP arents as a leading youth payment s ys tem. He will be in charge of s ecuring pa rtners hips with leading online a ction s ports brands a nd reta ilers a s well as building us er ba s e of young cons umers a nd their pa rents . Ma rk Miller has over twenty-five years experience working in Action S ports and youth culture bus ines s es . As a s enior executive, Ma rk focus ed on developing and executing go-tomarket s tra tegies for cons umer goods compa nies . Mos t recently, he s erved as the S enior V ice P res ident a nd G eneral Ma nager of DC S hoes , a s ubs idia ry of Q uiks ilver Inc., where he ma na ged the America s ' divis ion including s trategic pa rtners hips with both reta il a nd online dis tribution channels . S NAP Intera ctive Inc. announced una udited cons olida ted ea rnings res ults for the s econd quarter a nd s ix months ended J une 30, 2009. F or the quarter, the compa ny's revenue was $784,242, a s compa red to $533, 257 for the three months ended J une 30, 2008, a 47% increa s e. Net income for the quarter was $46,430 as compared to net income of $144, 862 or $0.01 per diluted s hare for the three months ended J une 30, 2008, a 68% decrea s e. Income from opera tions wa s $131,035 compa red with $145,133 for the s ame period a yea r ago. Income before provis ion for income ta xes was $137,985 compa red with $144,862 for the s ame period a yea r ago. F or the s ix months , the compa ny's revenue was $1,553,214, a s compa red to $1, 053, 159 for the s ix months ended J une 30, 2008, a 47% increa s e. T he increa s e in revenue wa s prima rily due to higher enga gement on its a pplica tions in 2009 compa red to the s a me time period in 2008 as well as the introduction of premium fea tures to its a pplications to genera te additional revenue. Net income for the period wa s $112, 902 or $0. 01 per diluted s hare a s compa red to net income of $335, 371 or $0. 03 per diluted s hare for the s ix months ended J une 30, 200
S NAP Interactive, Inc . (OTC B B : S TVI)
S NAP Intera ctive Inc. Announces Una udited C ons olida ted E arnings R es ults for the S econd Q ua rter and S ix Months E nded J une 30, 2009
Open Text C orp. (Nas daqGS : OTE X) K ings oft C o. L td. (S E HK : 3888)
Open T ext C orp. P rovides E a rnings G uida nce for the Y ear of 2010 K ings oft C o. Ltd. Announces to R elea s e O pen B eta T es t of J X3 O nline
O pen T ext C orp. provided ea rnings guida nce for the yea r of 2010. F or the year, the company expects to s ee s ingle-digit growth for revenues , double-digit growth for a djus ted ea rnings . K ings oft C o. L td. a nnounced that it would releas e the date for the open beta tes t of J X 3 O nline at a pres s conference to be held on Augus t 24, 2009. T he compa ny will a ls o la unch open beta tes ts of J X 2 O nline W ai Zhuan, a s is ter ga me to J X 2 O nline, and C hun Qiu W a i Zhua n, a nother s is ter game to C Q Online, on Augus t 20 a nd Augus t 21 res pectively. S o will the firs t expans ion pack of T he F irs t Myth 2 on Augus t 27. T hree more online games are under proprieta ry development a nd will meet gamers by the end of 2009, including Y ue Y ing C huan S huo a nd Du G u J iu J ia n. Y ue Y ing C hua n S huo is being developed by Zhuhai Xis ha nju S oftwa re C o. L td. (S ea s on S tudio) under K ings oft.
IB 3 Networks , Inc . (OTC B B : IB NW) B eyond C ommerc e, Inc. (OTC B B : B YOC ) Moggle, Inc ValueC lick Inc . (Nas daqG S : VC L K )
IB 3 Networks Inc. will C hange its T icker to IB NW E from IB NW B eyond C ommerce, Inc. has filed a S helf R egis tration in the amount of $15. 00 million. Moggle, Inc ha s filed a S helf R egis tration in the amount of $12.00 million. B a rra ck, R odos & B acine Announces S umma ry Notice of P ropos ed V alueC lick Inc. C la s s Action S ettlement a nd S ettlement Hea ring
E ffective Augus t 24, 2009, IB 3 Networks Inc. will change its O T C B B s tock ticker s ymbol to IB NW E from IB NW . B eyond C ommerce, Inc. ha s filed a S helf R egis tra tion in the a mount of $15.00 million. Moggle, Inc has filed a S helf R egis tra tion in the amount of $12. 00 million. B a rrack, R odos & B a cine a nnounced that purs ua nt to R ule 23 of the F ederal R ules of C ivil P rocedure and an Order of the C ourt, tha t a s ettlement for $10 million in ca s h ha s been propos ed in the a bove-ca ptioned certified clas s action a ga ins t V alueC lick Inc. A hea ring will be held before the Honorable Dea n D. P regers on, a t the United S ta tes Dis trict C ourt for the C entral Dis trict of C alifornia , W es tern Divis ion, 312 North S pring S treet, L os Angeles , C a lifornia 90012, at 10:00 a. m., on November 9, 2009 to determine whether the propos ed s ettlement s hould be a pproved by the C ourt a s fair, rea s ona ble, a nd a dequate, and to cons ider the a pplica tion of P laintiffs ' C ouns el for attorneys ' fees a nd reimburs ement of expens es .
Wizzard S oftware C orporation (AME X: WZE )
W izza rd Media Announces T ii P odcas t App Hits T op 100 W izzard S oftware C orporation a nnounced the a va ilability of the T ii P odca s t iP hone App currently ra nked number 58 on the 100 T op P a id Lis t in iT unes App S tore Apps lis t in the P roductivity category after only three days in the iT unes App S tore. T he new App, priced a t $1. 99, is the companion App for the T oday in iP hone podcas t. In a ddition to providing direct s trea ming acces s to the entire back catalog of T oday in iP hone podcas t epis odes , it a ls o offers exclus ive bonus content with iP hone T ips , T ricks a nd T utoria ls via audio a nd video footage. T he company is offering cus tomized podca s t compa nion Apps to the 11 600 podca s ts on the W izza rd Network as well as other interes ted top podcas ts as a new mea ns to monetize the content they crea te while offering their a udience members an enha nced viewing experience.
Open Text C orp. (Nas daqGS : OTE X)
Open T ext C orp. Announces Una udited C ons olidated E a rnings R es ults for the F ourth Quarter a nd F ull Y ear E nded J une 30, 2009
O pen T ext C orp. announced una udited cons olida ted earnings res ults for the fourth qua rter a nd full year ended J une 30, 2009. F or the qua rter, the compa ny reported income from opera tions of $34, 395, 000 a ga ins t $29,293,000 a yea r a go. Income before income ta xes was $28,508, 000 agains t $39, 875, 000 a year ago. Net income was $19, 481, 000 or $0.36 per diluted s hare on tota l revenues of $203,356,000 a ga ins t $27,254,000 or $0. 51 per diluted s ha re on tota l revenues of $200, 269,000 a year ago. Net cas h provided by operating activities wa s $38,627, 000 agains t $44, 611, 000 a year ago. Acquis ition of capita l as s ets was a mounted to $5, 842,000 a ga ins t $1, 481,000 a year ago. NonG AAP ba s ed a djus ted net income wa s $39.2 million or $0.73 per diluted s ha re agains t $33. 3 million or $0. 63 per diluted s hare a year a go. Non-G AAP net income wa s $41.6 million or $0. 78 per diluted s ha re on non-G AAP revenues of $203. 9 million. F or the year, the company reported income from opera tions of $97, 584, 000 a ga ins t $100, 379, 000 a year a go. Income before income ta xes wa s $80,777,000 agains t $76, 497, 000 a year a go. Net income was $56,938, 000 or $1.07 per diluted s hare on tota l revenues of $785,665,000
DigitalFX International, Inc . (OTC B B : DG FX)
Digita lF X International Announces E xecutive C ha nges
O n Augus t 17, 2009, Digita lF X International, Inc. 's C hief Operating Officer, Allen La ngford, res igned his pos ition with the company for pers ona l reas ons a nd the company a ppointed Mr. J ohn P retto, a ge 46, as its C hief O pera ting O fficer, pending a pprova l by the company's B oard of Directors . Mr. P retto has over twenty years of bus ines s a nd Informa tion technology ma nagement experience including s erving on the board of directors of other publicly tra ded corpora tions . T he company's B oard of Directors a pproved Mr. P retto's a ppointment as the C hief O pera ting O fficer on Augus t 20, 2009, effective a s of Augus t 17, 2009.
Figure 7. Key Developments Source. Capital IQ
Page 10
VALUATION Online Gaming companies lead market-cap charts: Fourteen companies in our W eb 2.0 universe top US$1 billion in market capitalization (Figure 8). Fifty-seven of the 91 companies have market caps under US$100 million, with 25 under US$10 million. Online gaming companies dominate the top of the list, led by Tencent Holdings with a market cap over US$20 billion.
Market C ap (US D m)
Tenc ent Holdings L td. Neteas e. c om Inc . S handa Interactive Entertainment L td. Modern Times Group Mtg A B IA C/InterA c tiveCorp. S ohu. c om Inc . Changyou. com L imited Gree, Inc . Open Tex t Corp. Perfect World Co. , L td. G iant Interac tive G roup, Inc . K ings oft Co. L td. Chines e Gamer International Mix i, Inc . V alueClick Inc . United Online Inc . NEOWIZ Games Corporation NetDragon WebS oft, Inc . S hutterfly , Inc . S K Communic ations Co. , L td. GungHo Online Entertainment, Inc . CDC Corp. G igaMedia L td. Openw ave S ys tems Inc . Gamania Digital Entertainment Co. , L td. The9 L imited XING A G DA DA S pA OA O R B C Information S ys tems A ctoz S oft Co. , L td. NeuLion Inc orporated GameOn Co L td. Y edangOnline Corp. Cyberplex Inc . Tree. Com, Inc . Myriad G roup A G K A B Dis tribution Inc . TheS treet. c om, Inc . HanbitS oft, Inc . Gravity Co. , L td Fluid Mus ic Canada, Inc . GeoS entric Oy j Frogs ter Interactive Pic tures A G PNI Digital Media Inc . Eolith Co. L td. S park Netw orks , Inc . Ngi G roup Inc . DigitalTow n, Inc . DXN Holdings B hd NeXplore Corporation Webz en Inc . A Q Interac tive, Inc . Northgate Tec hnologies L imited S oc ialw is e, Inc . Wiz z ard S oftw are Corporation L ookS mart, L td. Dolphin Digital Media, Inc . B roadWebA s ia Inc . Quepas a Corp. Y nk K orea Inc . A c c eleriz e New Media, Inc . J umbuck Entertainment Pty L td. L ingo Media Corporation UOMO Media, Inc S pec trumDNA , Inc . IA S Energy , Inc . B eyond Commerce, Inc . Worlds . c om Inc . CornerWorld Corporation MOK O. mobi L imited V OIS , Inc . DigitalPos t Interac tive, Inc . S NA P Interac tive, Inc . B right Things plc Ex tens ions , Inc . Magnitude Information S y s tems Inc . Wooz y Fly , Inc . is eemedia Inc . B etaw ave Corporation Wynds torm Corporation L iveWorld Inc . Unis erve Communic ations Corp. B igs tring Corp. A s s oc iated Media Holdings Inc . The Parent Company CLICK ER Inc . China Gatew ay Corporation Total S port Online A S S NM G lobal Holdings Dibz International, Inc . S ocial Media V enures , Inc . 0
Figure 8. Market Cap Ranking Source. Capital IQ
2094.4 2021. 1 2018. 6 1918. 6 1754. 9 1009. 5 1214. 6 1000. 3 937. 8
2520. 9 2473. 3
2901. 8
3255. 0
620. 4 503.0 452. 8 385. 7 314.4 294. 3 278. 7 257. 9 238. 2 233. 0 215. 3 207. 5 148. 1 145. 7 133. 1 116. 9 107. 0 103. 3 97. 1 93. 0 90. 4 83. 4 70. 7 67. 0 66. 4 64. 5 64. 3 60. 6 53. 2 50. 2 44. 2 42. 4 38. 3 34. 8 33. 5 33. 4 29.0 28.3 26.6 22. 7 21. 9 20. 9 19. 5 19. 1 17. 5 15. 8 15. 4 13. 0 12. 9 11. 0 10. 5 8. 3 5. 7 5. 3 5. 2 5. 0 4. 6 4. 3 4. 0 3. 6 3. 0 2. 6 2. 4 2. 3 1. 8 1. 5 1. 0 1. 0 0. 6 0. 5 0. 4 0. 3 0. 1 0. 0 0. 0 0. 0 500
1, 000
1, 500
2, 000
2, 500
3, 000
3, 500
4, 000
Page 11
TEV/Revenue (LTM) averages 4.8x: The overall average TEV/Revenue (LTM) multiple for our group is 5.0x (vs. 4.8x last week) (Figure 9). Two companies trade at more than 25x revenue – Bigstring Corp. (OTCBB:BSGC) at 32.5x, followed by Dolphin Digital Media, Inc. (OTCBB:DPDM) at 28.3x. The median is only 2.0x. Note that we exclude multiples greater than 50x. Twenty-nine companies have multiples under 1.5x.
T E V/L T M R evenue (x)
35. 0 30. 0 25. 0
22.1 20.8
32.5
28.3
20. 0
16.7
17.9 15.6 14.6 12.412.9 10.6
15. 0 10. 0 A vera ge, 5.0 5. 0 0. 0
6.7 6.9 4.6 4.7 5.0 4.0 4.1 4.5 4.5 3.3 3.5 3.8 2.4 2.4 2.5 2.5 2.5 2.6 2.7 1.5 1.7 1.8 2.0 0.8 0.8 0.8 0.9 0.9 0.9 1.0 1.1 1.1 1.2 1.4 1.5 0.1 0.2 0.2 0.2 0.3 0.5 0.5 0.5 0.6 0.6 0.7 0.7 0.8 0.8 9.4 9.9 7.5
Figure 9. TEV/Revenue Ranking Source. Capital IQ
TEV/Revenue (LTM) by country/exchange: W e have also calculated multiples based on where the companies are listed or domiciled. Figure 10 shows the average TEV/Revenue multiples by stock exchange. The OTCBB has the largest number of companies (19), trading at an average multiple of 11.0x (vs. 11.0x last week). On a geographic basis, the United States has the most companies (39), trading at an average of 5.1x revenue (vs. 5.1x last week) (Figure 11). Ten of the companies are Canadian (average 5.6x revenue).
Average TEV/LTM Revenue - By Exchange
16.0 14.6 14.0 11.8 12.0 11.0 10.0 10.3 9.9 9.1 8.0 6.0 6.8 4.0 2.0 OTCBB GTSM 0.0 SEHK AIM HLSE TSE XTRA
(x)
(x)
TSX OTCNO
OTCPK
NasdaqGM
ASX NasdaqGS
KOSE
OSE
KLSE
AMEX
TSXV
SWX
RTS
OM
CM
BSE
Germany
T heS treet.com, Inc . U nis erve C ommunications C orp. C LIC K E R Inc. T he P a rent C ompany N orthgate T echnologies L imited G a meO n C o Ltd. T ree.C om, Inc. P erfect World C o., Ltd. IAC /InterAc tiveC orp. DXN Holdings B hd J umbuck E nterta inment P ty L td. O penwave S y s tems Inc . C DC C orp. S NAP Intera ctive, Inc. DADA S pA S pa rk N etwork s , Inc . C y berplex Inc . is eemedia Inc . H anbitS oft, Inc . United O nline Inc . G igaMedia Ltd. S N M G loba l Holdings Ac toz S oft C o. , Ltd. B ey ond C ommerc e, Inc. V alueC lic k Inc . S hutterfly , Inc . G a mania Digital E ntertainment C o., Ltd. S K C ommunica tions C o., Ltd. Modern T imes G roup Mtg AB Y edangO nline C orp. P N I Digital Media Inc. G ungH o O nline E ntertainment, Inc. My riad G roup AG N E O WIZ G ames C orporation Y nk K orea Inc . O pen T ex t C orp. XIN G AG MO K O .mobi L imited E olith C o. Ltd. NetDra gon WebS oft, Inc . C ornerWorld C orporation S ohu.com Inc . Wiz z ard S oftware C orporation S ocial Media V enures , Inc . T otal S port O nline AS Acceleriz e New Media , Inc . NeuLion Inc orporated DigitalP os t Intera ctive, Inc. Mix i, Inc . C ha ngy ou.com L imited K ings oft C o. Ltd. G eoS entric O y j F luid Mus ic C a nada , Inc. Lingo Media C orporation G ree, Inc . B right T hings plc As s ociated Media Holdings Inc . C hines e G amer Interna tional F rogs ter Intera ctiv e P ic tures AG UO MO Media, Inc T encent Holdings Ltd. Dolphin Digital Media, Inc. B igs tring C orp.
Average TEV/LTM Revenue - By Country
16.0 14.6 14.0 12.0 10.0 8.0 6.0 4.0
0.3 0.3 0.0
10.3
9.9 7.9 6.4 5.7 5.6 5.1
5.5 4.64.0
3.6 2.6 2.5
2.4 2.0 2.0 2.0 1.8
0.8 0.6
4.6 2.5 2.0 2.0 1.8 0.8 0.8 Hong Kong Italy 0.6 0.3 0.0 Malaysia Russia 1 India 1
2.0 0.0 United Canada Finland United Japan China Taiwan Norway
Australia
South 8
# Companies
1 3 19 2 1 2 5 4 1 4 11 2 1 1 2 14 6 1 1 1 1 5 1
# Companies
1
2
1
10
3
6
10 39
1
Switzerland
1
2
Sweden 1
1
1
1
Figures 10 & 11. TEV/Revenue Ranking (Exchange, Country) Source. Capital IQ
Page 12
TEV/EBITDA (LTM) averages 11.9x: The average multiple for the 34 companies with positive EBITDA (and multiples under 100x) is 11.0x LTM EBITDA (vs. 11.0x last week), led by Tencent Holdings (SEHK-700) 44.9x multiple (Figure 12). Eleven companies have EBITDA multiples under 7x. The median multiple is 9.4x (vs. 9.2x last week).
T E V/L T M E B IT DA (x)
50. 0 44. 9 45. 0 40. 0 35. 0 29. 9 30. 0 25. 0 20. 3 20. 0 15. 0 10. 0 5. 0 0. 2 O AO R B C Information S y s tems 0. 0 1. 0 P erfec t World C o. , L td. 1. 8 J umbuck E ntertainment P ty Ltd. 1. 9 G ameO n C o L td. 2. 9 3. 2 3. 9 4. 4 4.5 5.1 A verage, 11. 9 6.3 7.8 8.1 8.5 9.2 9. 4 9. 4 9. 4 12. 4 10. 9 11. 6 11. 8 9. 5 10. 0 13. 6 14. 8 21. 5 21. 9 23. 4 24. 4 26. 1
NE O WIZ G ames C orporation
G amania Digital E ntertainment C o. , Ltd.
G ungH o O nline E ntertainment, Inc .
P NI Digital Media Inc .
S K C ommunic ations C o. , L td.
Modern T imes G roup Mtg AB
C hines e G amer International
C hangy ou. c om L imited
DXN Holdings B hd
S NAP Interac tive, Inc .
T heS treet. c om, Inc .
U nited O nline Inc .
O pen T ex t C orp.
C DC C orp.
NetDragon WebS oft, Inc .
Figure 12. TEV/EBITDA Ranking Source. Capital IQ
TEV/EBITDA (LTM) by country/exchange: Figure 13 shows the average TEV/EBITDA multiples by stock exchange. The OTCBB has the largest number of companies (19), trading at an average multiple of 2.9x (vs. 3.1x last week). On a geographic basis, the United States has the most companies (39), trading at an average of 9.2x EBITDA (Figure 14). Ten of the companies are Canadian (average 13.2x EBITDA).
Average TEV/LTM EBITDA - By Exchange
30.0 26.0 25.0 20.0 (x) 15.0 10.0 5.0 GTSM 0.0 SEHK TSXV NasdaqGS KOSE OSE TSE OM XTRA CM TSX 21.9 19.2 14.6 13.6 12.4 11.6 10.7 25.0 20.0 15.0 9.4 (x) 7.8 10.0 6.3 4.5 3.9 3.2 2.9 NasdaqGM OTCBB AMEX KLSE 1.8 0.2 ASX RTS 5.0 0.0
Average TEV/LTM EBITDA - By Country
19.2 16.8 14.3 13.2 12.4 11.6 10.9
9.4 9.2 6.3 4.5 1.8 Germany 0.2 Russia 1 0.0 Switzerland 1
Canada
Japan
China
Hong Kong
United States
O penwave S y s tems Inc .
Malaysia
Taiwan
South Korea
Italy
# Companies
3
4
2
5
1
6
1
14
2
4
1
1
2
5
19
2
1 # Companies 3 10 6 10 8 1
1
2
39
1
1
Figures 13 & 14. TEV/EBITDA Ranking (Exchange, Country) Source. Capital IQ
Australia 2
Sweden
T enc ent Holdings L td.
S park Network s , Inc .
IAC /InterAc tiveC orp.
Mix i, Inc .
V alueC lic k Inc .
C yberplex Inc .
S ohu. c om Inc .
Y edangO nline C orp.
S hutterfly , Inc.
G ree, Inc .
XING AG
Actoz S oft C o. , L td.
K ings oft C o. L td.
DADA S pA
Page 13
P/E (LTM) averages 11.0x: The average multiple for the 30 companies with positive earnings (and multiples under 100x) is 11.0x LTM EPS (vs. 11.0x last week), led Tencent Holdings Ltd (SEHK-700) 57.4x multiple (Figure 15). Eleven companies have P/E multiples under 10x. The median is just 12.1x.
P /E L T M (x)
70.0 60.0 51.4 50.0 40.0 33.6 30.0 21.8 19.7 20.3 20.0 A verage, 11.0 10.0 2.1 G iant Interactive G roup, Inc. 0.0 2.4 T he9 Limited 2.6 S handa Interactive E ntertainment Ltd. 2.7 P erfect World C o., Ltd. 3.1 Neteas e.com Inc. 5.8 6.0 7.7 8.6 11.9 12.1 10.2 11.3 11.4 16.2 14.1 14.4 14.6 27.2 27.3 37.5 38.9 45.3 57.4
J umbuck E ntertainment P ty Ltd.
G amania Digital E ntertainment C o., Ltd.
NE O W IZ G ames C orporation
Modern T imes G roup Mtg AB
C hines e G amer International
DXN H oldings B hd
C hangy ou.com Limited
S NAP Interactive, Inc.
G ameO n C o Ltd.
O pen T ex t C orp.
C y berplex Inc.
NetDragon W ebS oft, Inc.
Figure 15. P/E Ranking Source. Capital IQ
P/E (LTM) by country/exchange: Figure 16 shows the average P/E multiples by stock exchange. The OTCBB has the largest number of companies (19), trading at an average multiple of 22.6x. On a geographic basis, the United States has the most companies (39), trading at an average of 17.3x earnings (Figure 17). Ten of the companies are Canadian (average 21.1x EPS).
Average P/E - By Exchange
40.0 35.0 30.0 25.0 (x) 20.0 15.0 10.0 5.0 OTCBB GTSM 0.0 TSE SEHK KOSE NasdaqGS XTRA OM AMEX TSX KLSE ASX 33.6 29.6 22.6
(x)
40.0 35.0 30.0 25.0 20.0 15.0 10.0
Average P/E - By Country
36.0
36.0
23.1 21.8 21.1 17.3 14.3 14.1 11.7 6.0 5.8 0.0 0.0 Germany United States Malaysia Japan Canada China South Korea Australia Taiwan Switzerland 1 Sweden Italy 1
21.8
19.5 14.1 12.1 10.6 8.6 6.0 5.8
2.1 NYSE
5.0
0.0 NasdaqGM
0.0 SWX
0.0
# Companies
5
3
2
19
2
6
1
2
14
4
2
1
1
5
1
# Companies
6
3
2
10
39
10
1
8
2
1
Figures 16 & 17. P/E Ranking (Exchange, Country) Source. Capital IQ
T encent H oldings Ltd.
G igaMedia Ltd.
S park Network s , Inc.
IAC /InterActiveC orp.
S ohu.com Inc.
Worlds .com Inc.
Y edangO nline C orp.
Actoz S oft C o., Ltd.
K ings oft C o. Ltd.
G ree, Inc.
XING AG
Mix i, Inc.
Page 14
UPCOMING EVENTS
E arnings C alendar
C ompany
NetDragon W ebS oft, Inc. (S E HK : 777) T he9 L imited (Nas daqG S : NC T Y )
Figure 18. Earnings Calendar Source. Company reports
Date & Time
T ues day, Augus t 25, 2009 9: 00 P M (E DT ) T hurs day, Augus t 27, 2009 9: 00 P M (E DT )
Quarter
Q 2 2009 Q 2 2009
C onf C all Details
10-800-130-0399 800-561-2693
Page 15
C omparable C ompany Analys is > Web 2.0
Pric 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 s ociated Media H oldings Inc. B igs tring C orp. B eta wave C orpora tion B eyond C ommerce, Inc. B right T hings plc B roadW ebA s ia Inc. C DC C orp. C ha ngyou.com Limited C hina G a tewa y C orporation C hines e G a mer International C LIC K E R Inc. C ornerW orld C orpora tion C yberplex Inc. DADA S pA DXN Holdings B hd Dibz Interna tional, Inc. DigitalP os t Intera ctive, Inc. DigitalT own, Inc. Dolphin Digital Media, Inc. E olith C o. L td. E xtens ions , Inc. F luid Mus ic C anada, Inc. F rogs ter Intera ctive P ictures AG G amania Digita l E ntertainment C o., L td. G ameO n C o L td. G eoS entric Oyj G ia nt Interactive G roup, Inc. G igaMedia L td. G ra vity C o., Ltd G ree, Inc. G ungH o Online E ntertainment, Inc. H anbitS oft, Inc. IAC /InterA ctiveC orp. IAS E nergy, Inc. is eemedia Inc. J umbuck E ntertainment P ty Ltd. K AB Dis tribution Inc. K ings oft C o. L td. L ingo Media C orpora tion L iveW orld Inc. L ookS mart, L td. Ma gnitude Information S ys tems Inc. Mixi, Inc. Modern T imes G roup Mtg AB MO K O .mobi L imited Myriad G roup AG NE O W IZ G ames C orporation NetDra gon W ebS oft, Inc. Netea s e. com Inc. NeuLion Incorpora ted NeXplore C orpora tion Ngi G roup Inc. Northgate T echnologies Limited O pen T ext C orp. O penwa ve 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 ha nda Interactive E nterta inment L td. S hutterfly, Inc. S K C ommunications C o. , L td. S NA P Intera ctive, Inc. S NM G loba l H oldings S ocial Media V enures , Inc. S ocialwis e, Inc. S ohu.com Inc. S pa rk Networks , Inc. S pectrumDNA, Inc. T encent H oldings Ltd. T he P a rent C ompany T he9 L imited T heS treet.com, Inc. T ota l S port Online A S 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. W oozyF ly, Inc. W ynds torm C orpora tion XING A G Y eda ngOnline C orp. Y nk K orea Inc. H igh L ow Average Media n C urrenc y US D KR W JPY US D US D US D US D GB P US D US D US D US D TWD US D US D C AD E UR MY R US D 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 US D C AD AU D C AD HK D C AD US D US D US D JPY SEK AU D 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 US D US D HK D US D US D US D NO K US D C AD US D US D US D US D US D US D US D US D US D E UR KR W KR W Tic ker AC L Z A052790 3838 AS MH BSGC B W AV B Y OC AIM:B G T BWBA C H IN.A C Y OU CGWY G T S M:3083 CLK Z CW R L T S X: C X C M:DA DXN DIB Z 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 IA S A. E IE E AS X: J MB T S X: K AB 3888 T S XV :LM LV W D LO OK MAG Y 2121 MT G B MK B 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 NMN S MV I S CLW S O HU LO V S P XA 700 K IDS . Q NC T Y TS CM T OS O TR E E T S XV :US S UNT D UO MO V CLK V O IS W ZE N W ZE W DDD W ZY F W Y ND O1B C A052770 A023770 E xc hange OT C B B K OS E TS E OT C P K OT C B B OT C B B OT C B B A IM OT C P K Nas da qG S Nas da qG S OT C P K GTS M OT C B B OT C B B TS X CM K LS E OT C P K 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 H LS E NY S E Nas da qG S Nas da qG M TS E OS E K OS E Nas da qG S OT C B B T S XV AS X TS X S E HK T S XV OT C P K Nas da qG M OT C B B TS E OM AS X S WX K OS E S E HK Nas da qG S TS X OT C P K TS E BSE Nas da qG S Nas da qG S Nas da qG S T S XV OT C B B R TS Nas da qG S Nas da qG S K OS E OT C B B OT C P K OT C P K OT C B B Nas da qG S A ME X OT C B B S E HK OT C P K Nas da qG S Nas da qG M O T C NO Nas da qG M T S XV Nas da qG S OT C B B Nas da qG S OT C B B Nas da qG M A ME X OT C B B OT C B B OT C P K XT R A K OS E K OS E US D Market C ap ($m) 15.8 133.1 29.0 0.6 1.0 2.3 8.3 4.0 19.5 278.7 2, 094.4 0.3 1, 009.5 0.4 5.3 97.1 148.1 34.8 0.0 4.6 38.3 20.9 50.2 3.6 64.5 60.6 233.0 107.0 64.3 1, 754.9 257.9 66.4 2, 021.1 294.3 67.0 2, 520.9 10.5 2.4 15.4 83.4 1, 214.6 13.0 1.5 21.9 3.0 1, 000.3 2, 901.8 5.2 90.4 503.0 452.8 5, 472.2 116.9 33.5 42.4 28.3 2, 018.6 238.2 1, 918.6 53.2 19.1 145.7 3, 255.0 385.7 314.4 4.3 0.0 0.0 26.6 2, 473.3 44.2 11.0 28,087. 7 0.5 215.3 70.7 0.1 93.0 1.0 620.4 12.9 937.8 5.0 33.4 22.7 5.7 2.6 1.8 207.5 103.3 17.5 C urrent P ric e 0.57 19, 150 50, 400 0.01 0.02 0.08 0.18 0.01 0.23 2.63 38.08 0.02 393.50 0.01 0.06 1.60 6.38 0.53 0.00 0.06 1.40 0.39 860.00 0.08 1.32 16.75 50.30 104, 700 0.05 7.75 4.73 2.39 8, 540 243, 000 3, 795 19.04 0.15 0.05 0.38 1 9 1.12 0.05 1.28 0.01 614,000.00 310.00 0.07 4.50 29,650.00 6.64 42.28 1.10 0.60 32,400.00 39.40 35.95 2.86 39.01 1.67 1.50 1.05 48.75 15.15 9,310.00 0 0.00 0.17 0.60 64.52 2 0 120 0.02 8.44 2.31 0.03 8.61 0.05 7.40 0.15 10.76 0.01 2.82 0.45 0.11 0.15 0.10 27.49 8, 550 4, 075 1 Wk 1. 8% -10.1% 1. 6% -30.0% -11.1% 33.3% -33.3% -2.3% -22.8% 3. 5% 2. 0% -25.0% -4.4% -9.1% -8.3% -3.0% 4. 8% 9. 3% 20.0% 20.0% 7. 7% 0. 0% 4. 9% -60.0% 10.0% 19.6% -11.3% 1. 7% 0. 0% 0. 9% 7. 3% 18.9% 7. 7% 5. 7% -8.0% 3. 5% 25.0% -16.7% 4. 2% 0. 0% 2. 7% 12.0% -9.1% 6. 7% 8. 3% 1. 7% 7. 6% -5.3% 5. 6% -6.2% 12.0% 5. 1% 0. 0% -11.8% -1.2% 14.9% -5.8% 2. 1% 7. 9% 4. 4% 7. 1% 0. 0% 7. 4% 2. 7% -5.5% 100.0% 125.0% -10.5% -11.8% 7. 7% 1. 3% -2.2% 4. 3% 31.3% 1. 9% 2. 7% 0. 0% -3.7% 0. 0% 1. 2% 20.0% 7. 5% 20.0% 3. 7% -4.3% 10.0% 0. 0% 0. 0% 0. 0% -3.6% -14.6% 125.0% -60.0% 3.6% 1. 9% 1 Mth 26.7% -24.6% -17.8% -30.0% -42.7% -27.3% -50.0% -33.3% -22.8% -17.6% -8.6% 650.0% -13.1% -41.2% 10.0% -8.6% 4.6% 34.2% NM -1.6% -30.0% 8.3% 9.6% 0.0% 48.3% 39.2% -18.1% -2.1% 66.7% -5.1% -5.0% 55.2% 24.3% 13.0% -15.7% 6.3% 0.0% -37.5% 7.1% 0.0% 20.9% 1.8% 42.9% 7.6% -13.3% -11.7% 23.0% -5.3% 3.4% -4.0% 9.6% 0.2% 34.1% 9.1% -3.0% 5.6% -6.7% -3.7% 11.6% 11.3% 51.5% 16.7% -14.5% -3.4% -1.9% -11.1% 12.5% -46.9% -21.4% 1.4% -9.8% 60.7% 15.9% -29.6% -6.0% 12.1% 0.0% -19.5% -35.7% -16.6% 46.3% -9.0% -14.3% -19.3% -8.2% -18.5% NM 0.0% -6.9% 6.6% -29.7% 650.0% -50.0% 7.0% -2.0% 3 Mth 14.0% -23.4% -30.0% 833.3% -29.6% 0.0% -82.0% -19.9% -54.9% 68.6% 13.2% 650.0% 11.8% 25.0% -38.9% -5.3% 8.3% 41.3% 20.0% 185.7% -44.0% -35.0% 12.4% -46.7% 76.0% 104.5% -8.2% 8.3% 0.0% 1.6% -22.5% 106.0% 60.8% 56.8% -31.6% 18.7% -42.3% -44.4% -16.7% 4.9% 51.8% 6.7% -37.5% 1.6% -35.0% 31.5% 38.7% 7.6% -21.7% -20.9% 23.0% 31.9% 37.5% -14.3% -6.4% 1.4% 8.6% 43.0% 109.7% -1.2% 51.5% 6.6% -6.5% 4.9% -13.0% -46.7% 80.0% 1600. 0% -14.3% 11.1% -5.8% -43.8% 57.2% 97.0% -6.1% 16.7% 0.0% -30.8% 12.5% 13.8% -46.4% 3.1% -33.3% -39.6% -21.0% -26.7% 0.0% 233.3% -17.8% -22.3% -45.7% 1600. 0% -82.0% 42.4% 1.6% 6 Mth 62.9% 76.5% 62.1% 180.0% 2. 4% -52.9% -76.6% -16.7% -77.2% 220.7% NM 650.0% 211.1% -87.5% -63.3% 357.1% 18.5% 55.9% -88.0% 650.0% -41.7% -23.5% 43.3% -60.0% 203.4% 316.7% 127.6% 9. 6% 150.0% 25.2% -21.6% 246.4% 84.4% 99.5% 19.7% 25.9% 275.0% -47.4% -16.7% 77.8% 223.5% 40.0% 0. 0% 4. 9% -65.8% 57.8% 178.0% 57.8% 22.0% 88.3% 143.2% 126.1% 175.0% -1.6% 86.2% 7. 9% 12.7% 261.6% 216.6% -16.5% 16.3% 238.7% 49.7% 86.3% 37.9% -59.6% 350.0% -86.4% 53.8% 30.7% -15.8% 136.8% 163.7% -21.2% -29.5% 12.1% -25.0% 97.5% -43.8% 47.4% 114.3% 75.5% -20.0% 149.6% -30.8% -8.3% 0. 0% -16.7% -11.3% 36.8% 3. 8% 650.0% -88.0% 73.3% 37.9% 1 Yr -9.5% 96.6% -62. 1% -30. 0% -74. 0% -74. 2% -93. 9% -32. 4% -84. 7% -0.8% NM -50. 0% 391. 1% -99. 2% -92. 6% 158. 1% -45. 7% 35.9% -97. 6% 9.1% -67. 1% -51. 3% 19.4% -46. 7% -26. 7% 140. 0% 103. 8% -17. 6% 0.0% -15. 4% -59. 4% 62.6% NM 38.1% 7.2% 14.7% -25. 0% -68. 8% -31. 8% -11. 1% 193. 9% -41. 7% -80. 0% -60. 5% -59. 4% -31. 0% -9.5% 97.2% -54. 3% 175. 8% 18.6% 61.9% NM 11.1% -64. 9% -86. 4% 2.5% 98.6% 55.4% -50. 7% -53. 3% -86. 2% 84.0% 62.9% -26. 4% -55. 1% -99. 4% -32. 0% -74. 8% -14. 3% -49. 8% -61. 9% 79.1% -99. 0% -53. 9% -67. 5% -40. 0% 13.3% -82. 0% -29. 7% -61. 5% -16. 5% -62. 5% 30.6% -64. 6% -63. 3% NM -83. 3% -21. 2% 0.7% -58. 8% 391. 1% -99. 4% -12.1% -31. 4% 52 Week -13.6% -46.8% -64.3% -72.0% -77.5% -76.5% -94.2% -49.4% -92.1% -32.9% -21.3% -57.1% -24.2% -99.3% -93.0% -19.6% -46.8% -3.6% -97.6% -39.4% -68.9% -65.5% -25.9% -92.1% -26.7% -3.7% -26.9% -31.6% -28.6% -24.6% -61.1% -9.1% -2.4% -13.2% -42.8% -2.7% -46.4% -73.7% -38.5% -24.7% -8.4% -41.7% -80.0% -61.8% -78.3% -33.3% -13.3% -29.0% -54.5% -29.4% -7.1% -9.9% -5.2% -58.6% -74.6% -87.4% -10.5% -8.6% -7.0% -52.8% -56.6% -86.6% -25.0% -8.4% -28.4% -63.0% -99.7% -96.6% -76.9% -19.2% -51.9% -61.9% -2.2% -99.0% -57.4% -68.5% -40.0% -34.1% -82.0% -34.2% -85.8% -20.3% -73.9% -39.7% -74.0% -68.6% -96.3% -83.3% -23.6% -31.0% -67.1% -2.2% -99.7% -47.4% -44.6%
720.6
Figure 19. Price Performance Source. Capital IQ
Page 16
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 Intera ctive, Inc. As s ocia ted Media Holdings Inc. B igs tring C orp. B etawave C orpora tion B eyond C ommerce, Inc. B right T hings plc B roadW ebAs ia Inc. C DC C orp. C hangyou.com Limited C hina G atewa y C orpora tion C hines e G amer Interna tional C L IC K E R Inc. C ornerW orld C orporation C yberplex Inc. DA DA S pA DXN Holdings B hd Dibz Interna tiona l, Inc. DigitalP os t Interactive, Inc. DigitalT own, Inc. Dolphin Digital Media, Inc. E olith C o. L td. E xtens ions , Inc. F luid Mus ic C a nada, Inc. F rogs ter Interactive P ictures A G G amania Digital E ntertainment C o., Ltd. G ameO n C o Ltd. G eoS entric Oyj G iant Interactive G roup, Inc. G igaMedia Ltd. G ravity C o., Ltd G ree, Inc. G ungH o O nline E nterta inment, Inc. Ha nbitS oft, Inc. IAC /InterActiveC orp. IAS E nergy, Inc. is eemedia Inc. J umbuck E ntertainment P ty L td. K A B Dis tribution Inc. K ings oft C o. Ltd. Lingo Media C orpora tion LiveW orld Inc. LookS ma rt, L td. Magnitude Information S ys tems Inc. Mixi, Inc. Modern T imes G roup Mtg AB MOK O .mobi Limited Myriad G roup AG NE OW IZ G ames C orporation NetDra gon W ebS oft, Inc. Netea s 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 N I Digital Media Inc. Q uepa s a C orp. O AO R B C Information S ys tems S handa Interactive E nterta inment Ltd. S hutterfly, Inc. S K C ommunications C o., Ltd. S N AP Interactive, Inc. S N M G lobal Holdings S ocial Media V enures , Inc. S ocialwis e, Inc. S ohu.com Inc. S park N etworks , Inc. S pectrumDN A, Inc. T encent Holdings Ltd. T he P a rent C ompany T he9 L imited T heS treet.com, Inc. T otal S port Online AS T ree.C om, Inc. Unis erve C ommunications C orp. United Online Inc. UO MO Media, Inc V a lueC lick Inc. V O IS , Inc. W ebzen Inc. W izzard S oftware C orporation W orlds .com Inc. W oozyF ly, Inc. W ynds torm C orporation XIN G AG Y eda ngO nline C orp. Y nk K orea Inc. High Low Average Median
S ec tor
Direct Marketing G aming G aming Mobile Ins ta nt Mes s aging Media S ocial Networking S ocial Networking S ocial Networking G aming G aming Mobile G aming Direct Marketing C ontent A dvertis ing S ocial Networking S ocial Networking S NS Apps 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 V ideo C ontent S ocial Networking C ontent G aming L earning S ocial Networking Direct Marketing S ocial Networking S ocial Networking Media S ocial Networking Mobile G aming G aming G aming V ideo C ontent Media Direct Marketing C ollabora tion Mobile G aming Digita l Ima ging S ocial Networking Media G aming Digita l Ima ging S earch Dating Media S ocial Networking S ocial Networking G aming S ocial Networking Media P orta l Media G aming Media Media P orta l S ocial Networking Media Media Media S ocial Networking G aming P odca s ting C ontent S ocial Networking C ontent S ocial Networking G aming G aming
C ountry
U nited S ta tes S outh K orea J apan U nited S ta tes 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 U nited S ta tes T a iwa n U nited S ta tes U nited S ta tes C ana da Italy Mala ys ia U nited S ta tes 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 erma ny T a iwa n J apan F inland C hina T a iwa n S outh K orea J apan J apan S outh K orea U nited S ta tes C ana da C ana da Aus tra lia C ana da C hina C ana da U nited S ta tes U nited S ta tes U nited S ta tes J apan S weden Aus tra lia S witzerla nd S outh K orea C hina C hina C ana da U nited S ta tes J apan 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 U nited S ta tes U nited S ta tes C hina U nited S ta tes U nited S ta tes C hina U nited S ta tes C hina U nited S ta tes N orway 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 U nited S ta tes U nited S ta tes G erma ny S outh K orea S outh K orea
P rimary E xc hange
OTCB B K OS E TS E OTCP K OTCB B OTCB B OTCB B AIM OTCP K N as da qG S N as da qG S OTCP K GTS M OTCB B OTCB B TS X CM K LS E OTCP K OTCB B OTCB B OTCB B K OS E OTCP K TS X XT R A GTS M TS E H LS E NY S E N as da qG S N as da qG M TS E OS E K OS E N as da qG S OTCB B T S XV AS X TS X S E HK T S XV OTCP K N as da qG M OTCB B TS E OM AS X SWX K OS E S E HK N as da qG S TS X OTCP K TS E BS E N as da qG S N as da qG S N as da qG S T S XV OTCB B R TS N as da qG S N as da qG S K OS E OTCB B OTCP K OTCP K OTCB B N as da qG S AME X OTCB B S E HK OTCP K N as da qG S N as da qG M O T C NO N as da qG M T S XV N as da qG S OTCB B N as da qG S OTCB B N as da qG M AME X OTCB B OTCB B OTCP K XT R A K OS E K OS E
Ticker
AC LZ A052790 3838 AS MH BSGC B W AV B YOC AIM:B G T BWBA C HIN.A C Y OU CGW Y G T S M:3083 C LK Z CW R L T S X: C X C M:DA DXN DIB Z 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 IAS A.E IE E AS X:J MB T S X:K AB 3888 T S XV : LM LV W D L OOK MA G Y 2121 MT G B MK B 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 FLY A066270 S TVI S NMN S MV I S CLW S O HU L OV S P XA 700 K IDS .Q NC T Y TS CM T OS O TREE T S XV :US S U NT D UO MO V CLK V OIS W ZE N W ZE W DDD W ZY F W Y ND O1B C A052770 A023770
US D Market C ap ($m)
15.8 133.1 29.0 0.6 1.0 2.3 8.3 4.0 19.5 278.7 2,094.4 0.3 1,009.5 0.4 5.3 97.1 148.1 34.8 0.0 4.6 38.3 20.9 50.2 3.6 64.5 60.6 233.0 107.0 64.3 1,754.9 257.9 66.4 2,021.1 294.3 67.0 2,520.9 10.5 2.4 15.4 83.4 1,214.6 13.0 1.5 21.9 3.0 1,000.3 2,901.8 5.2 90.4 503.0 452.8 5,472.2 116.9 33.5 42.4 28.3 2,018.6 238.2 1,918.6 53.2 19.1 145.7 3,255.0 385.7 314.4 4.3 0.0 0.0 26.6 2,473.3 44.2 11.0 28,087.7 0.5 215.3 70.7 0.1 93.0 1.0 620.4 12.9 937.8 5.0 33.4 22.7 5.7 2.6 1.8 207.5 103.3 17.5 28,087.7 0.0 720.6 47.2
TE V/L TM R evenue
4.7x 1.1x 15.6x 32.5x 1.2x 14.6x 0.8x 7.5x 0.0x 16.7x 0.2x 4.0x 0.8x 0.8x 0.6x 6.7x 28.3x 3.5x 10.6x 17.9x 1.5x 0.5x 9.9x 1.0x 12.9x 2.4x 0.9x 0.6x 0.9x 0.7x 9.4x 12.4x 0.0x 6.9x 1.8x 3.3x 2.5x 2.5x 3.8x 5.0x 0.3x 2.6x 0.7x 0.5x 2.4x 0.0x 1.5x 1.7x 0.8x 1.1x 4.5x 4.1x 0.8x 22.1x 0.2x 0.1x 4.6x 0.5x 0.2x 0.9x 20.8x 1.4x 4.5x 2.7x 2.0x 2.5x 32.5x 0.0x 5.0x 2.0x
TE V/ NTM R evenue
5.8x 0.7x 1.4x 7.5x 1.0x 1.7x 2.2x 0.7x 2.7x 2.0x 1.4x 3.5x 0.2x 0.1x 0.9x 1.5x 7.5x 0.1x 2.1x 1.5x
TE V/L TM E B ITDA
5. 1x 10.9x 12.4x 29.9x 7. 8x 6. 3x 4. 5x 8. 5x 1. 9x 21.5x 13.6x 14.8x 1. 8x 23.4x 20.3x 11.6x 9. 2x 9. 5x 10.0x 24.4x 1. 0x 21.9x 0. 2x 11.8x 26.1x 2. 9x 9. 4x 3. 9x 44.9x 3. 2x 4. 4x 8. 1x 9. 4x 9. 4x 44.9x 0. 2x 11.9x 9. 4x
TE V/NTM E B ITDA
10.1x 6.0x 4.7x 13.1x 8.4x 5.9x 5.2x 6.5x 7.4x 7.8x 13.0x 7.1x 3.7x 5.7x 13.1x 3.7x 7.5x 6.8x
P /L TM E P S
19.7x 14.4x 38.9x 8.6x 5.8x 20.3x 11.3x 2.1x 10.2x 0.0x 45.3x 11.9x 6.0x 27.3x 51.4x 14.1x 27.2x 16.2x 3.1x 33.6x 2.7x 2.6x 7.7x 14.6x 12.1x 57.4x 2.4x 0.0x 37.5x 21.8x 11.4x 57.4x 0.0x 17.4x 12.1x
P /NTM E P S
12.9x 9.7x 1.6x 14.0x 9.5x 36.3x 15.4x 17.0x 14.2x 44.7x 12.7x 13.2x 13.2x 17.6x 12.1x 48.5x 10.6x 16.8x 48.5x 1.6x 17.8x 13.6x
P /TangB V
2.2x 0.5x 0.5x 14.2x 14.6x 3.8x 0.7x 4.7x 6.0x 8.2x 3.1x 1.3x 10.7x 0.3x 2.2x 0.0x 21.0x 41.3x 2.0x 1.2x 1.9x 1.5x 0.9x 6.6x 13.1x 0.7x 0.8x 7.0x 3.7x 4.0x 13.8x 2.4x 0.9x 8.5x 0.9x 3.5x 1.3x 18.3x 1.1x 2.3x 2.4x 4.8x 45.2x 25.6x 0.1x 0.9x 1.2x 6.1x 17.1x 0.0x 6.8x 3.6x 0.8x 45.2x 0.0x 6.6x 2.7x
Figure 20. Valuation Comparison Source. Capital IQ
Page 17
C omparable C ompany Analys is > Web 2.0
S ummary by C ountry
C ompany Name United S tates C a na da C hina S outh K orea J a pa n T a iwa n Aus tralia G erma ny S witzerla nd Hong K ong F inla nd Ita ly United K ingdom India S weden R us s ia Ma lays ia Norwa y G rand Total 39 10 10 8 6 3 2 2 1 1 1 1 1 1 1 1 1 1 90 US D Market C ap ($m) C hina U nited S ta tes J a pan S weden C anada T a iwa n S outh K orea Hong K ong G ermany Ita ly R us s ia S witzerla nd F inland Malays ia India Aus tralia U nited K ingdom Norway G rand Total 46, 938. 8 5, 255. 6 3, 494. 2 2, 901. 8 2, 409. 0 1, 500. 4 1, 270. 9 278. 7 268. 1 148. 1 145. 7 90. 4 64. 3 34. 8 28. 3 20. 5 4. 0 0. 1 64,853.7 Avg US D Market C ap ($m) C hina S weden J apan T aiwan Hong K ong C anada S outh K orea Ita ly R us s ia U nited S ta tes G ermany S witzerla nd F inland Malays ia India Aus tralia U nited K ingdom Norway G rand Total 4,693. 9 2,901. 8 582. 4 500. 1 278. 7 240. 9 158. 9 148. 1 145. 7 134. 8 134. 0 90. 4 64. 3 34. 8 28. 3 10. 3 4. 0 0. 1 720.6 US D L TM Total R ev ($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 R us s ia India Ma lays ia G erma ny S witzerla nd Aus tralia F inla nd Norwa y United K ingdom G rand Total 4,080. 4 3,887. 4 1,950. 0 1,015. 7 672. 3 616. 5 379. 1 361. 6 236. 5 150. 9 81. 9 76. 5 60. 8 40. 0 16. 3 6. 1 2. 2 0. 3 13,634.4 US D L TM Total E B ITDA ($m) C hina S weden United S tates C a na da J a pa n S outh K orea T a iwa n Ita ly Hong K ong R us s ia Ma lays ia G erma ny Aus tralia S witzerla nd Norwa y United K ingdom F inla nd India G rand Total 2, 038. 8 299. 6 289. 4 200. 3 181. 5 94. 2 56. 2 31. 1 25. 1 19. 7 11. 0 10. 3 3. 1 0. 8 -1. 1 -1. 9 -15. 7 -40. 9 3,201.5 E B ITDA % C hina A us tralia T aiwan G ermany J apan S weden Mala ys ia Italy R us s ia S outh K orea Hong K ong S witzerla nd C anada U nited S ta tes India Norway U nited K ingdom F inland G rand Total 49. 4% 37. 2% 36. 9% 28. 8% 25. 0% 15. 4% 14. 4% 13. 1% 13. 1% 7. 9% 6. 9% 1. 9% -12. 1% -21. 9% -50. 0% -50. 6% NA NA 5.0%
Figure 21. Comparison by Country Source. Capital IQ
C omparable C ompany Analys is > Web 2.0
S ummary by E xc hange
C ompany Name OT C B B Na s daqG S OT C P K K OS E TS E Na s daqG M TS X T S XV S E HK AME X AS X XT R A GTS M SWX HL S E CM BS E NY S E OS E AIM OM RTS K LS E OT C NO G rand Total 19 14 11 6 5 5 4 4 3 2 2 2 2 1 1 1 1 1 1 1 1 1 1 1 90 US D Market C ap ($m) S E HK Nas da qG S TS E OM NY S E GTS M K OS E TS X OS E Nas da qG M XT R A OT C B B CM R TS SWX T S XV AME X HLS E OT C P K K LS E BS E AS X AIM OT C NO G rand Total 29, 755. 1 22, 686. 9 3, 199. 8 2, 901. 8 1, 754. 9 1, 242. 6 1, 171. 1 362. 0 294. 3 285. 5 268. 1 197. 6 148. 1 145. 7 90. 4 69. 6 66. 9 64. 3 61. 3 34. 8 28. 3 20. 5 4. 0 0. 1 64,853.7 Avg US D Market C ap ($m) S E HK OM NY S E Nas da qG S TSE GTS M OS E K OS E CM R TS XT R A TSX SWX HLS E Nas da qG M K LS E AME X BS E T S XV OT C B B AS X OT C P K AIM OT C NO G rand Total 9,918. 4 2,901. 8 1,754. 9 1,620. 5 640. 0 621. 3 294. 3 195. 2 148. 1 145. 7 134. 0 90. 5 90. 4 64. 3 57. 1 34. 8 33. 4 28. 3 17. 4 10. 4 10. 3 5. 6 4. 0 0. 1 720.6 US D L TM Total R ev ($m) OM S E HK Na s daqG S CM NY S E RTS OS E TS E K OS E GTS M BSE Na s daqG M K LS E TS X SWX XT R A AME X OT C P K T S XV AS X HL S E OT C B B OT C NO AIM G rand Total 1,950. 0 535. 7 494. 4 236. 5 198. 5 150. 9 109. 0 101. 5 100. 6 97. 7 81. 9 81. 8 76. 5 46. 7 40. 0 30. 4 27. 9 16. 5 12. 0 8. 1 6. 1 2. 3 2. 2 0. 3 13,634.4 US D L TM Total E B ITDA ($m) Na s daqG S S E HK OM TS E NY S E K OS E GTS M CM RTS OS E Na s daqG M K LS E XT R A AME X AS X SWX OT C NO AIM TS X T S XV HL S E OT C P K BSE OT C B B G rand Total 1, 760. 5 772. 0 299. 6 161. 9 124. 1 79. 3 56. 2 31. 1 19. 7 19. 6 11. 7 11. 0 10. 3 6. 2 3. 1 0. 8 -1. 1 -1. 9 -4. 2 -4. 4 -15. 7 -34. 1 -40. 9 -63. 5 3,201.5 E B ITDA % NY S E S E HK AS X GTS M Nas da qG S XT R A TSE OS E OM K LS E CM R TS Nas da qG M T S XV K OS E S WX A ME X TSX OTCP K OTCB B BSE O T C NO HLS E A IM G rand Total 62. 5% 43. 0% 37. 2% 36. 9% 30. 3% 28. 8% 26. 4% 18. 0% 15. 4% 14. 4% 13. 1% 13. 1% 6. 4% 5. 6% 4. 4% 1. 9% -31. 8% -34. 7% -41. 5% -45. 1% -50. 0% -50. 6% #DIV /0! #DIV /0! 5.0%
Figure 22. Comparison by Exchange Source. Capital IQ
Page 18
Financ ing - L as t Three Months (US $ m)
F in. Amount (Million) Month J un-09 C ompany Name S ugar Inc. Tumri B oku W imba G rab Networks AdC hina G oojet S AS E do Interactive AdMeld Inc. beeTV blueK iwi S oftware S A Nokeena B ubble Motion S ens e Networks Zoos k G ather MojoP ages Taomee Animoto G ameG round R ingR evenue C rowdcas t YuMe eR epublik News er L L C C lic kFuel Inigral AdE x Media G R OU.P S my6s ens e Yapta OneTXT I L ove R ewards C liqs et P icaboo TodaC ell G lubble AdW hirl L iquidP lanner Mas hL ogic J un-09 Total C ountry 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 rael US A US A US A S pain US A US A US A US A US A Is rael US A US A C ana da US A US A Is rael Netherlands US A US A US A 1. 0 1. 0 0. 5 53.3 15.3 28.5 67.8 34.0 5.3 1. 5 1. 0 1. 0 1. 0 2. 0 1. 8 2. 1 2. 0 2. 0 2. 4 2. 3 3. 0 2. 9 2. 8 2. 5 2. 5 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 Type of financing Angel/S eed P IP E S eries A S eries B 15. 0 S eries C 16. 0 S eries D G rand Total 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. 5 204.1
Page 19
F in. Amount (Million) Month J ul-09 C ompany Name P andora Media K ontera L td. Ning QuickP lay Media 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. OP E N S ports network S tyleC as ter Nexage TweetDeck B us ca Akademos P rotonMedia iL oop Mobile C omunitae Aloqa L at49 Tributes .c om C oTweet C likthrough C ognitive Matc h L imited C ellufun B ookF res h P eople C apital Mas her Media J ul-09 Total Aug-09 Turbine Mint R ic hR elevance Traffiq MediaMath B ill.c om E do Interactive InnoC entive B oxee P olyvore K ODA OurS tage Z2L ive S coreloop R oblox C hes s C ube iS yndica Aug-09 Total G rand Total 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 S outh Africa US A C ountry US A Is rael US A C ana da 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 UK US A US A US A US A S pain G ermany C ana da US A US A US A UK US A US A US A US A
Type of financing Angel/S eed 15. 5 15. 0 12. 0 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 3. 2 2. 6 2. 5 2. 5 2. 0 1. 7 1. 5 1. 5 1. 2 1. 1 1. 0 1. 0 1. 0 0. 5 0. 5 0. 3 63.8 11.1 36.8 51.5 27.0 50. 0 14. 1 12. 5 10. 0 10. 0 8. 5 8. 5 7. 3 6. 0 5. 6 3. 0 3. 0 3. 0 2. 8 2. 2 1. 3 0. 4 25.3 142.4 15.3 3.0 42.6 47.2 151.7 22.6 108.1 50.0 82.3 P IP E S eries A S eries B S eries C 35. 0 S eries D G rand Total 35. 0 15. 5 15. 0 12. 0 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 3. 2 2. 6 2. 5 2. 5 2. 0 1. 7 1. 5 1. 5 1. 2 1. 1 1. 0 1. 0 1. 0 0. 5 0. 5 0. 3 190.2 50. 0 14. 1 12. 5 10. 0 10. 0 8. 5 8. 5 7. 3 6. 0 5. 6 3. 0 3. 0 3. 0 2. 8 2. 2 1. 3 0. 4 148.1 542.3
Figure 23. Financing, Last Three Months Source. Company reports
Page 20
C ompany Des c riptions - C urrent Month C apital Market Ac tivity
C ompany
B ill.com
HQ
United S ta tes
Webs ite
Des cription
B ill. com, Inc. offers an electronic cas h management s ervice. Its s ervice s implifies the way companies ma nage bills , invoices , contracts , and other documents . T he company delivers its s ervice through an on-demand S oftware a s a S ervice (S aaS ) model. C as hV iew is a W eb-bas ed s ys tem that allows companies to s tore all documents , proces s es , mes s ages , and trans a ctions in one place. It gives companies a real-time daily view of anticipated cas h flow while s imultaneous ly proces s ing trans actions . T he compa ny was formerly known as C as hV iew, Inc. a nd changed its name to B ill. com, Inc. in J anuary, 2008. B ill. com, Inc. was founded in 2006 and is bas ed in P alo Alto, C alifornia. B oxee T V , Ltd. develops media center s oftware. T he company’s s oftware enables its us ers to control media programs s tored in the pers onal computer or the Internet doma in, and brings them to the televis ion. It enables its us ers to view, rate, and recommend content to their friends through s ocial networking features , as well as its s ocial component allows s haring with friends . T he company was founded in 2007 and is bas ed in New Y ork, New Y ork. C hes s C ube, is an online game allowing us ers to play ches s for free and maintain their online rating, s ocialize in chat rooms and invite friends to play ches s . T he company is bas ed in S outh Africa. edo interactive, Inc. develops technologies for digital marketing. T he company focus es on Marketing P latform, a behavioral targeting and marketing platform that allows bus ines s es to create micro-targeted ma rketing campa igns ; monitor the campaign from their computer; target k ey cons umer groups us ing demogra phic, geographic, a nd ps ychographic cons umer information to filter a nd build targeted campa igns ; and offers demons trable s ales revenue res ults . It offers P rewarding, a tool that gives cas h incentives directly to cons umers in advance of des ired purchas ing behavior through their pre-pa id debit Mas terC ard; C as h, a s ys tem that provides cas h rewa rds to loyal cus tomers ; and MarketIQ , which provides rea l-time feedback from cus tomers through s urveys and focus group tools . T he company was founded in 2007 and is bas ed in Na s hville, T ennes s ee. F riends R eunited G roup operates as an online community that connects people through a network of friends . It provides an online meeting place for people to s ocializ e, ma ke acqua intances , and find others who s hare their interes ts . T he company a ls o ena bles members to look up friend’s W eb pages , and s hare photos and videos . In addition, it offers online da ting s ervices . T he compa ny is bas ed in the United K ingdom. F riends R eunited G roup operates as a s ubs idia ry of IT V plc. G igP ark (www. gigpa rk. com) is a s ocia l recommendations tool to find the trus ted s ervice people that friends us e iLike. com, Inc. operates as a s ocial mus ic dis covery s ervice and mus ic application on s ocia l networking s ites in the United K ingdom and L atin America. It offers iLike S idebar for fans , which s cans mus ic library, recommends mus ic, and connects friends and the iLike community, a s well as offers a lerts on concerts and favorite artis ts . T he company a ls o provides iLike Univers al Artis t Da s hboard for a rtis ts to manage their online pres ence. In addition, it offers a mus ic-promotion platform for promoters to create multimedia a ds to target us ers by location and mus ic tas te; and enables W eb s ite or application developers to add mus ic features . F urther, the company provides t-s hirts for men and women online. iLike. com, Inc. was formerly known a s E volution Artis ts , Inc. T he company wa s founded in 2002 and is bas ed in S eattle, W as hington. As of Augus t 19, 2009, iLike. com, Inc. operates as a s ubs idiary of MyS pace, Inc. F ounded in 2001, InnoC entive built the firs t global web community for open innova tion, enabling s cientis ts , engineers , profes s iona ls and entrepreneurs to collaborate to deliver brea kthrough s olutions for innovative organiz ations . InnoC entive S eekers , who collectively s pend billions of dolla rs on R &D, s ubmit C hallenges to the InnoC entive Marketpla ce where more than 160, 000+ engineers , s cientis ts , inventors , bus ines s people, a nd res earch organiz ations in more than 175 countries a re invited to s olve them. S olvers who deliver the mos t innovative s olutions receive financial awards ra nging up to US $1, 000,000. InnoC entive’s S eekers include commercial, government and non-profit organiz ations s uch as P rocter & G amble, Avery Dennis on, P endulum, E li L illy and C ompany, J a ns s en, S olvay, G lobalG iving and T he R ockefeller F oundation iS yndica, a cloud-ba s ed digital media dis tribution platform, s implifies online s elling by s yndica ting, promoting and tracking us er content on multiple es tablis hed channels . iS yndica’s Upload O nce - S ell E verywhere™ approa ch helps us ers increas e revenue while reducing their work load. B uilt on Amazon W eb S ervices (AW S ), our V irtua l Dis tribution S erver (V DS ) is a groundbreaking, patent pending, multi-category s oftware-as -a-s ervice (S aaS ) dis tribution platform. iS yndica currently s upports photogra phy a nd video. K ODA was founded with a mis s ion to create a pla tform that allows emerging talent and s ma rt companies to go beyond the res ume or traditional job pos ting. More profes s ional than F acebook but more pers onal than LinkedIn, K ODA looks to s howcas e profiles and employer profiles that allow both s ides of the hiring equa tion to get to know each other. Media Math, LLC provides cros s -exchange a dvertis ing management s ervices and technology. T he company offers S ingularity, a media buying platform for advertis ing a gencies , which provides technology, s trategy, s ervices , and ins ights to trade a cros s dis play a dvertis ing exchanges on behalf of advertis ers . Media Math, LLC was founded in 2007 and is bas ed in New Y ork, New Y ork . Mint S oftware, Inc. provides a W eb-bas ed s olution for online fina ncial mana gement. It offers money mana gement, debt management, expens e tracking, inves tment ma nagement, budget management, mutual fund, IR A management, a nd financial pla nning s ervices . T he company als o provides s ugges tions bas ed on us er’s s pending patterns and a utomatic categorization of purcha s es . Mint S oftware, Inc. was founded in 2006 and is bas ed in Mountain V iew, C a lifornia . O urS ta ge, Inc. offers a democra tic competition that allows fa ns to decide the bes t artis t in entertainment in the United S tates . Its O urS ta ge. com allows the artis t to upload their mus ic or video, and decide which competition to enter, s o that the Internet a udience judges the work s ide by s ide with the work of others . At the end of ea ch month, the top performers enter into the company’s S MS text voting period, where the artis t in each channel with the mos t S MS votes wins the priz e. OurS tage, Inc. was founded in 2006 and is bas ed in C helms ford, Mas s achus etts . P olyvore, a fa s hion 2. 0 company founded by the man res pons ible for Y ahoo P ipes , lets us ers mix and ma tch complete outfits by dragging a nd dropping clothing images found on the web. It’s part s ocia l network, and part des igners ’ club, the end res ult being a place where us ers can put together their dream outfit or learn about the lates t fas hions from other us ers . richrelevance, Inc. provides pers ona liza tion and product recommenda tion tools for the eC ommerce s ites . It offers R ichrecs , which offers product recommenda tions to pers onaliz e cus tomer's s hopping experience; myrecs that enga ges loyal s hoppers with a pers onalized pa ge of releva nt product recommendations ; and richmail, which enables cros s -s elling a nd up s elling of relevant products . richreleva nce, Inc. was founded in 2005 and is headquartered in S an F rancis co, C alifornia. It has loca tions in S an Diego, C alifornia; Dallas a nd Hous ton, T exas ; and New Y ork, New Y ork. R oblox C orpora tion develops online gaming s oftware. R oblox C orpora tion was founded in 2004 and is bas ed in P ortola V alley, C alifornia. T R AF F IQ , Inc. , a dis pla y advertis ing mark etplace, operates a digital media management platform that connects buyers and s ellers of online media. Its platform provides a s uite of enterpris e tools that enables negotiations for deal points and centraliz ed advertis ing operations , including trafficking, inventory management, tra cking a nd optimiz ation, and billing. T he company’s pla tform incorporates components of the media planning, buying, and s elling proces s , including s ite s earch, inventory pa ckaging tools , negotiation management, order execution, a utomated R F P dis tribution, campa ign optimiz ation, a nd publis her reconciliation/invoicing. It s erves advertis ers and publis hers . T he company was founded in 2006 and is bas ed in New Y ork, New Y ork with an additional office in V ienna, V irginia. T urbine, Inc. , an interactive media company, engages in developing, launching, and operating online entertainment in North America . It offers online games , including multiplayer online role-pla ying games . T he company operates s ocial gaming communities . It als o s ells its games through reta ilers in North America and E urope. T urbine, Inc. was formerly known a s T urbine E ntertainment S oftware C orp. T he company was founded in 1994 and is headquartered in W es twood, Ma s s achus etts . Z2L ive, a mobile multiplayer ga ming platform, was formed to leverage the new capa bilities of mobile devices , the s eamles s flow between mobile and W eb communities and the advent of cons umer-focus ed marketplaces . T he compa ny was founded in 2009 by Damon Danieli, a 14-year Micros oft veteran, David B luhm, a long time veteran of mobile content and entertainment and Madrona V enture G roup, a S ea ttlebas ed venture capital firm. Z2Live’s mis s ion is to enable multipla yer gaming acros s all mobile devices and all wireles s networks .
www.bill.com
B oxee
United S ta tes
www.boxee.tv
C hes s C ube E do Interac tive
S outh Africa United S ta tes
www.chesscube.com www.edointeractive.net
F riends R eunited
United K ingdom
www.friendsreunited.co.uk
G igP ark iL ike
C a nada United S ta tes
www.gigpark.com www.ilike.com
InnoC entive
United S ta tes
www.innocentive.com
iS yndica
United S ta tes
www.isyndica.com
K oda
United S ta tes
www.koda.us www.mediamath.com www.mint.com
MediaMath
United S ta tes
Mint
United S ta tes
OurS tage
United S ta tes
www.ourstage.com
P olyVore
United S ta tes
www.polyvore.com www.richrelevance.com
R ichR elevance
United S ta tes
R oblox Traffiq
United S ta tes United S ta tes
www.roblox.com www.traffiq.com
Turbine Inc.
United S ta tes
www.turbine.com
Z2L ive
United S ta tes
www.z2live.com
Figure 24. Company Descriptions Source. Company reports, Capital IQ, Crunchbase
Page 21
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
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