SOFTWARE & SERVICES
10 NOVEMBER 2009
WEB 2.O WEEKLY
ANOTHER TECH BUBBLE? NOT Q UITE
GO OGL E A CQ UI R E S AD M OB N ET W OR K
DAVID SHORE, CFA, MBA 416.860.6784
david.shore@researchcapital.com Damian Wojcichowsky, CFA (Associate), 416.860.7652
Google announced the acquisition of AdMob, the mobile ad platform that serves online ads for a network of 15,000 mobile W eb sites. AdMob’s platform has made considerable in-roads into the iPhone ecosystem, and fits nicely with the burgeoning Google Android platform. Google bid $750 million for the company, which generates a revenue run rate of approximately $100 million currently, implying a Price/Sales valuation on the deal of 7.5x. Before we begin proclaiming the onset of a new tech bubble, we note that Google and Microsoft both acquired companies in the same digital marketing space in 2007 for double digit P/S multiples (see Digital Marketing M&A Valuations).
Digital Marketing M&A Valuations
WPP Group acquires 24/7 Real Media
Google acquires AdMob (November 2009)
Google acquires DoubleClick (April 2007)
Microsoft acquires aQuantive (May 2007)
-
2.0
4.0
6.0
8.0
10.0
12.0
14.0
16.0
Price/Sales (trailing 12 months)
EL E CT R ON IC A RT S A CQ UI R ES PL A YF I SH
The long-anticipated acquisition of Playfish by Electronic Arts has come to fruition in a deal involving consideration of $275 million upfront in cash, $25 million in retention payments via shares, and $100 million in earn-out – a total consideration of $400 million potentially. The Price/Sales valuation on this transaction (based on estimates of $75 million in Playfish revenue run rate) ranges between 4.0x and 5.3x (depending on the value when EA closes the deal). Playfish operates social games on Facebook, MySpace, Hi5, and other social networks which have been installed more than 150 million times, and claims 60 million monthly active users. Its top games include Pet Society, Restaurant City, Country Story, and Who Has The Biggest Brain?
S UMM AR Y – C A PIT AL M A RK ET S A CT I V IT Y
Slow down continues since late October: Total transaction value in the Web 2.0 universe for November is $24.2 million – a decidedly slow start to the month. November has begun with six financings in the sector averaging $4.0 million each (vs. an average of $6.3 million last month). In comparison, total capital raised in October was $171.3 million, averaging $6.3 million (27 deals); September was $232.8 million, averaging $9.0 million (26 deals); and August was $221.6 million, averaging $7.6 million (29 deals).
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 Eighty-nine public Web 2.0 companies: Our W eb 2.0 universe contains 89 companies, with a combined market cap of approximately $71 billion (Figure 1). The median market cap for the group is $41.8 million, with average trailing revenue of $163 million (median $56 million). The companies are also generally profitable with a median EBITDA margin of 11.6%. On a valuation basis, the overall average is 5.3x trailing revenue (median 1.8x) and 11.1x trailing EBITDA (median 8.3x). 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 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 Limited 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 entures 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 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 ynds torm C orpora tion XING AG Y D O nline C orp. Y nk K orea Inc. High Low Average Median
L TM as of Ticker
6/30/2009 6/30/2009 6/30/2009 6/30/2007 6/30/2009 6/30/2009 6/30/2009 3/31/2009 9/30/2008 6/30/2009 9/30/2009 9/30/2008 9/30/2009 5/31/2009 7/31/2009 6/30/2009 6/30/2009 8/31/2009 NA 6/30/2009 8/31/2009 6/30/2009 12/31/2008 6/30/2009 6/30/2009 6/30/2009 9/30/2009 6/30/2009 6/30/2009 6/30/2009 3/31/2009 6/30/2009 9/30/2009 6/30/2009 6/30/2009 9/30/2009 4/30/2009 6/30/2009 6/30/2009 6/30/2009 6/30/2009 6/30/2009 6/30/2009 9/30/2009 6/30/2009 6/30/2009 9/30/2009 6/30/2009 6/30/2009 12/31/2008 6/30/2009 6/30/2009 6/30/2009 6/30/2009 6/30/2009 6/30/2009 9/30/2009 9/30/2009 6/30/2009 6/30/2009 6/30/2009 12/31/2007 6/30/2009 9/30/2009 12/31/2008 6/30/2009 9/30/2008 12/31/2008 6/30/2009 9/30/2009 6/30/2009 6/30/2009 6/30/2009 8/2/2008 12/31/2008 3/31/2009 9/30/2009 8/31/2009 9/30/2009 7/31/2009 9/30/2009 6/30/2009 6/30/2009 6/30/2009 6/30/2009 NA 6/30/2009 12/31/2007 12/31/2008 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 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 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 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 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 US D C AD 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 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 G ermany S outh K orea S outh K orea
C urrent P rice
0. 75 15,450 47,400 0. 01 0. 03 0. 03 0. 07 0. 01 0. 03 2. 52 33. 14 0. 00 444 0. 01 0. 06 1 7. 35 0. 63 0. 00 0. 05 0. 50 0. 40 570 0. 25 1. 80 18. 66 45. 05 72,200 0. 06 7 3. 82 1. 57 5,410 205,400 3,580 19. 61 0. 12 0. 19 0. 34 0 8 0. 98 0. 04 1. 17 0. 01 740000. 00 323. 00 0. 09 4. 79 39250. 00 5 42. 00 0. 68 1 26600. 00 30. 85 39. 04 2. 15 49. 08 1. 76 1 1. 60 50. 41 15. 55 7150. 00 0 0. 00 0 0. 55 57. 86 3 0 139 0. 01 7. 88 2. 45 7. 78 0. 04 8. 33 0 10 0 3. 09 0. 47 0. 10 0. 10 32. 30 7120. 00 4020. 00
US D Market C ap ($m)
21. 0 112. 1 28. 8 0.4 2.0 0.9 3.5 5.4 2.5 267. 1 1,822. 7 0.0 1,151. 5 0.5 5.7 84. 2 174. 5 41. 1 0.0 3.5 13. 7 21. 5 34. 6 11. 1 86. 8 70. 0 211. 0 78. 1 78. 9 1,648. 5 208. 3 43. 6 2,708. 5 263. 2 65. 7 2,587. 9 8.5 9.2 14. 5 0.6 1,074. 8 11. 2 1.1 20. 0 4.1 1,275. 1 3,056. 7 7.9 205. 4 693. 4 351. 2 5,435. 9 72. 8 41. 8 36. 8 22. 4 2,201. 1 179. 6 2,473. 2 55. 4 17. 8 222. 0 3,390. 3 399. 2 250. 9 4.3 0.0 0.0 24. 3 2,225. 1 55. 0 7.3 32, 555.5 0.2 197. 7 75. 0 84. 8 0.8 704. 6 6.9 906. 4 6.2 36. 6 23. 7 5.2 1.8 249. 4 89. 5 18. 0 32, 555.5 0.0 794.1 41. 8
US D L TM Total R ev ($m)
4. 4 108.7 66. 1 0. 1 0. 1 9. 4 11. 7 0. 0 0. 0 361.6 255.3 6. 7 68. 3 2. 5 6. 8 89. 8 241.9 77. 3 NA 1. 0 0. 0 0. 6 15. 4 NM 5. 3 9. 6 151.2 81. 9 5. 4 198.5 183.6 49. 1 210.3 119.5 60. 7 1, 359. 6 0. 0 1. 7 16. 7 67. 9 139.1 1. 2 10. 6 54. 0 0. 1 136.8 2, 002. 6 0. 7 63. 0 207.3 89. 3 472.4 21. 5 1. 7 93. 0 82. 9 814.5 190.5 255.6 21. 0 0. 2 157.4 629.0 223.1 192.7 3. 5 2. 0 0. 1 0. 0 501.0 50. 5 0. 1 1, 391. 6 112.0 250.6 67. 0 217.1 16. 1 996.8 0. 8 545.7 0. 0 23. 2 5. 3 0. 1 NA 58. 9 57. 4 11. 9 2,002. 6 0. 0 163.0 55.7
US D L TM Total E B ITDA ($m)
(3.7) 25. 9 (2.0) (2.3) (1.5) (12. 6) (12. 8) (2.7) (4.6) 25. 1 157.4 (6.6) 39. 6 (1.2) NM 9.7 31. 8 (84. 0) NM (1.4) (1.8) (3.4) (3.6) NM (5.1) (4.5) 24. 9 20. 1 (17. 4) 124.1 NM 16. 6 122.2 26. 6 1.4 82. 4 (0.6) (4.5) 7.2 4.0 61. 4 (1.9) (0.1) (4.9) (2.5) 46. 2 282.9 (2.4) 3.4 55. 7 25. 7 297.4 (13. 0) (13. 3) 6.9 (41. 5) 211.1 5.6 142.2 2.3 (10. 6) 20. 6 296.7 27. 0 12. 5 0.9 (0.7) (0.1) (5.6) 218.5 10. 8 (2.5) 680.3 (13. 5) 85. 5 1.9 10. 5 0.1 214.9 (0.4) 130.8 (1.0) 2.3 (4.5) (0.7) NM 17. 0 12. 4 1.3 680. 3 -84.0 39.4 1. 7
E B ITDA %
-83. 3% 23. 8% -2.9% NM NM NM NM NM NM 6.9% 61. 7% -98. 9% 58. 0% -45. 8% NM 10. 8% 13. 1% NM NM NM NM NM -23. 6% NM -95. 2% -47. 0% 16. 5% 24. 5% NM 62. 5% NM 33. 9% 58. 1% 22. 2% 2.3% 6.1% NM NM 42. 8% 5.8% 44. 2% NM -1.2% -9.0% NM 33. 8% 14. 1% NM 5.4% 26. 8% 28. 7% 63. 0% -60. 3% NM 7.4% -50. 0% 25. 9% 3.0% 55. 6% 11. 0% NM 13. 1% 47. 2% 12. 1% 6.5% 27. 0% -34. 8% -60. 6% NM 43. 6% 21. 3% NM 48. 9% -12. 0% 34. 1% 2.9% 4.8% 0.9% 21. 6% -54. 2% 24. 0% NM 9.9% -84. 9% NM NM 28. 8% 21. 6% 10. 5% 63. 0% -98. 9% 6.2% 11. 6%
TE V/L TM R evenue
5. 8x 0. 7x 0. 1x 13.2x 48.2x 0. 8x 0. 7x 5. 9x 0. 0x 15.7x 0. 2x 2. 4x 0. 7x 0. 9x 0. 7x 5. 5x 38.6x 2. 4x 15.4x 7. 1x 1. 2x 0. 0x 14.5x 0. 7x 12.4x 1. 9x 0. 9x 0. 7x 5. 2x 0. 5x 7. 7x 8. 6x 8. 4x 1. 8x 10.0x 3. 2x 3. 3x 2. 3x 2. 9x 27.0x 0. 3x 2. 8x 0. 4x 0. 9x 2. 5x 0. 0x 1. 3x 1. 3x 0. 8x 1. 1x 4. 5x 3. 4x 1. 0x 25.8x 0. 2x 0. 2x 0. 3x 0. 3x 1. 0x 9. 3x 1. 4x 4. 7x 3. 3x 1. 7x 48.2x 5.3x 1. 8x
TE V/L TM E B ITDA
3. 1x 10. 5x 9. 6x 27. 0x 6. 6x 7. 0x 7. 5x 0. 2x 21. 3x 8. 6x 36. 9x 11. 5x 1. 1x 17. 5x 25. 0x 12. 7x 12. 3x 8. 0x 10. 8x 13. 3x 1. 5x 23. 1x 0. 4x 10. 6x 20. 0x 2. 9x 7. 7x 4. 9x 5. 4x 6. 2x 36. 4x 4. 5x 5. 7x 11. 6x 8. 0x 36. 9x 11.1x 8. 3x
E mployees
11 NA NA 3 4 51 101 NA 46 2, 227 628 37 NA 22 16 NA NA NA NA 7 3 NA NA 2 NA NA NA NA 115 1, 570 751 469 NA NA NA 3, 200 NA NA 79 NA 2, 463 NA NA 90 14 NA 2, 969 NA 405 NA 3, 109 3, 109 237 NA NA NA 3, 900 590 2, 096 NA 74 NA 3, 124 514 NA 11 33 NA NA 3, 197 183 7 6, 421 347 1, 626 310 700 NA 1, 469 NA 1, 189 4 328 110 1 NA 246 NA NA 6, 421 1 945 246
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 ) Slow down continues since late October: Total transaction value in the Web 2.0 universe for November is $24.2 million – a decidedly slow start to the month. November has begun with six financings in the sector averaging $4.0 million each (vs. an average of $6.3 million last month). In comparison, total capital raised in October was $171.3 million, averaging $6.3 million (27 deals); September was $232.8 million, averaging $9.0 million (26 deals); and August was $221.6 million, averaging $7.6 million (29 deals).
Financing Activity Last Twelve Months
400.0 14.6 350.0 14.0 16.0
300.0
12.0
250.0 9.0 (US$m)
10.0
200.0 7.1 6.7 150.0 4.9 6.5 6.6 6.2 5.6
7.6
8.0 6.3 6.0
4.0 100.0 4.0
50.0
2.0
0.0 Dec-08 Jan-09 Feb-09 Mar-09 Apr-09 May-09 Total Jun-09 Average Jul-09 Aug-09 Sep-09 Oct-09 Nov-09
0.0
*May-09 includes $200m FB investment
Figure 2. Financings, Last Twelve Months Source. Company reports
(US$m)
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Deal round-up for November start: The large deal highlights for the month include: • Playfish – the UK-based social gaming company – was acquired by Electronic Arts in a deal potentially valued up to $400 million. Motley Fool – the financial information site – raised $25 million in an unattributed financing. Phoenix New Media – the subsidiary of Phoenix Television, a popular Chinese news portal and media site – raised $25 million from Intel Capital and Bertelsmann Asia Investment Fund.
• •
All other deals in the month were in the amount of $10 million or less. For additional details on financings, see Figures 23 and 24 (at end of note).
Financing & M/A Summary - Last Three Months
200.0
180.0
160.0
140.0
120.0 (US$m) Nov-09 100.0 Oct-09 Sep-09 80.0
60.0
40.0
20.0
0.0 Skype PlayFish Mint Twitter DailyMotion Phoenix New Motley Fool Yext NowPublic PopCap Games Ensequence Engine Yard Ecast Network HubSpot Livebookings Dopplr Jive Software Spigit Ooyala FeedRoom Mzinga InXpo ScanScout Jobvite CubeTree Riot Games NextBio Box.net Aviary Reality Mobile HiveLive Vuclip Eventbrite Imeem Watercooler Booyah YuMe Altruik Vdopia NeoEdge Sometrics Scout Labs Amie Street Alliance Health Unisfair Credit Karma Mocapay ViVu Conduit Labs Fwix Vantrix Fizzback Blekko MashLogic Overtone Godengo Greystripe Technorati Loomia FourSquare Tiny Pictures Onehub EduFire DataSync DailyBooth Hot Potato Linkedex StatusNet IngBoo Chango Fluther Scoopler TransGaming Inc. Listia OnLive VEVO Gamelab.com Aurora Feint
Figure 3. Capital Market Activity, Last Three Months Source. Company reports
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Social Networks the most active sector: Social Networks experienced the most financing activity among our W eb 2.0 sector categories in the past three months by number of transactions (8). Collaboration-related companies have been hot recently, garnering the second highest number of deals (7). Advertising continues to be among the highest activity sectors in the past quarter (6 deals) (Figure 4). The $2.0 billion acquisition of Skype skews the dollars transacted to the SMS/Voice segment, while the $400 million acquisition of Playfish brings the Virtual W orlds segment to the second highest total. Finally, the $170 million acquisition of Mint brings the Vertical Communities segment into third place.
Capital Market Activity by Sector - Last Three Months
200.0 180.0 160.0 140.0 120.0 (US$m) 100.0 80.0 60.0 40.0 20.0 2,025.0 0.0 Vertical Communities Collaboration Gaming Enterprise Microblog Mobile Media Music Infrastructure SMS/Voice Social Networks Virtual World Advertising Classified Search Video Crowdsourced Content Analytics 417.1 178.3 100.9 68.3 57.0 49.3 45.5 39.9 37.5 36.5 30.0 25.6 17.2 16.2 13.0 6.4 6.0 3.9 Social Commerce 3.6 Aggregation 3.0 Financial Services 2.2 Publishing 2.0 Mobile Ad 1.5 Comment/Reputation 1
# companies
1 4 2 2 5 3 8 7 6 3 4 4 2 2 5 4 2 1
1
2
2
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 continues 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 Q1/09. Since then, the index has diverged in a much stronger recovery relative to the NASDAQ index (Figure 5).
Web 2.0 Index Price Performance
250
200
150
100
50
0 1/19/2009 2/16/2009 3/16/2009 3/30/2009 4/13/2009 4/27/2009 5/11/2009 5/25/2009 6/22/2009 7/20/2009 8/17/2009 8/31/2009 9/14/2009 9/28/2009 12/8/2008 11/10/2008 11/24/2008 12/22/2008 10/12/2009 10/26/2009 11/9/2009 1/5/2009 2/2/2009 3/2/2009 6/8/2009 7/6/2009 8/3/2009
Index: Web 2.0 (Market Cap)
Figure 5. Web 2.0 Price Performance Source. Capital IQ
^COMP - Share Pricing
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Broad-based price improvement: Thirty-five companies in our universe had positive stock price performances over the past week (for stocks with prices greater than $1) (Figure 6), while 12 companies showed negative 1-week returns.
Quepas a Corp. Perf ect World Co., Ltd. V alueClick Inc. S handa Interactive Entertainment Ltd. Neteas e.com Inc. S hutterf ly , Inc. Changy ou.com Limited Eolith Co. Ltd. NetDragon WebS oft, Inc. CDC Corp. S ohu.com Inc. A ctoz S oft Co., Ltd. G ree, Inc. United Online Inc. Open Tex t Corp. Northgate Technologies Limited Modern Times G roup Mtg A B HanbitS oft, Inc. Y D Online Corp. Openw ave S y s tems Inc. Chines e G amer International DA DA S pA IA C/InterA ctiveCorp. Y nk K orea Inc. Webz en Inc. NEOWIZ G ames Corporation TheS treet.c om, Inc. K ings oft Co. Ltd. S K Communica tions Co., Ltd. A Q Interactive, Inc. The9 Limited Cy berplex Inc. Fluid Mus ic Canada, Inc. G amania Digital Entertainment Co., Ltd. G iant Interactive G roup, Inc. G ravity Co., Ltd My riad G roup A G Frogs ter Interactive Pictures A G PNI Digital Media Inc. Tencent Holdings Ltd. Tree.Com, Inc. Ngi G roup Inc. G igaMedia Ltd. Mix i, Inc. S park Netw orks , Inc. X ING A G L ookS ma rt, Ltd. G ameOn Co Ltd. -0.2
Figure 6. 1-Week Price Performance Source. Capital IQ
1 Week P rice P erformance
13.5% 12.9% 11.5% 11.4%
16.7%
-7.3% -7.4% -15.3% -0.15 -9.3% -0.1
-2.0% -2.0% -2.2% -2.9% -3.4% -3.4% -4.0% -5.2%
7.5% 7.5% 7.2% 7.0% 6.6% 6.3% 6.0% 5.7% 5.3% 5.2% 4.7% 4.6% 4.4% 4.2% 4.0% 3.1% 3.1% 2.0% 1.7% 1.7% 1.5% 1.4% 1.3% 0.8% 0.7% 0.6% 0.6% 0.3% 0.0%
9.2% 9.2%
-0.05
0
0.05
0.1
0.15
0.2
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P U B L I C C O M P A N Y I N D U S T R Y N E W S (P A R T N E R S H I P S , F I N A N C I A L R E S U L T S , N E W P R O D U C T S )
K ey Developments
C ompany
P erfect World C o., L td. (Nas daqG S :P WR D)
Headline
P erfect W orld C o., Ltd. P ropos es Amendments to Memorandum and Articles of As s ociation
Notes
P erfect W orld C o. , Ltd. announced that an annual genera l meeting of company will be held on November 14, 2009 for the purpos es of cons idering amendment of Article 1 of the a mended a nd res ta ted Memora ndum and Articles of As s ociation of the company by adding the following definition: 'Des igna ted S tock E xcha nge' means T he Nas daq S tock Market. And for the purpos es of cons idering amendment of Article 111 of the amended and res tated Memorandum a nd Articles of As s ocia tion of the company by repla cing it with the following new article: 111. S ubject to a pplicable la w and rules of the Des ignated S tock E xchange: (1) T he B oard s hall a ppoint an Auditor to a udit the accounts of the company a nd s uch a uditor s ha ll hold office until the board appoints another a uditor. S uch auditor may be a member but no director or officer or employee of the company s hall, during his continuance in office, be eligible to act as an a uditor of the compa ny. (2) A pers on, other tha n a retiring a uditor, s hall not be capable of being appointed auditor at a boa rd meeting unles s notice in writing of an intention to nominate tha t pers on to the office of Auditor ha s been given not les s than fourteen (14) days before the boa rd meeting a nd furthermore, the company s hall s end a copy of any s uch notice to the retiring a uditor. (3) T he B oard ma y, a t any board meeting convened and held in accordance with thes e articles , remove the auditor at any time before the expira tion of his term of office and s hall at tha t meeting appoint a nother Auditor in his s tead for the rema inder of his term. Neteas e.com Inc. la unched its ga me cha nnel, game.163. com, to extend its bus ines s . T he new channel will initially provide news on games , including product news , player oriented news , and indus try information. T he compa ny ha s es ta blis hed a tea m to collect and report the s elect content. Northgate T echnologies Limited reported una udited cons olidated and s tandalone ea rnings res ults for the s econd qua rter a nd s ix months ended S eptember 30, 2009. F or the quarter, the company reported on cons olidated ba s is , net los s of INR 169.999 million or INR 4.85 per diluted s ha re on revenue of INR 140. 411 million compared to net income of INR 224. 050 million or INR 6. 29 per diluted s hare on revenue of INR 1,893. 738 million for the s a me quarter a year ago. Net los s from ordinary activities after tax and before minority interes t was INR 169. 999 million, operating los s a fter interes t of INR 166.229 million compa red to net profit from ordinary activities after tax a nd before minority interes t of INR 225. 468 million, opera ting profit after interes t of INR 283. 971 million for the s ame quarter a yea r ago. Los s from ordinary activities before ta x wa s INR 157.143 million, operating los s before interes t of INR 165.203 million a nd opera ting los s before interes t, depreciation a nd amortization of INR 70. 719 million compared to profit from ordina ry activities before tax of INR 285. 564 million, operating profit before interes t of INR 286. 325 million a nd opera ting profit before interes t, depreciation a nd amortiza tion of INR 463.570 million for the s ame quarter a yea r ago. O penwave S ys tems Inc. has announced that B ouygues T elecom has s elected O penwave's traffic management s olution to ma nage a nd optimize its network tra ffic. O penwave's traffic ma nagement s olution monitors and dyna mically controls a divers e range of IP (T C P -a nd UDP -bas ed) data flows within the B ouygues mobile network. O penwave's monitoring features will ena ble B ouygues T elecom to obtain better ins ights into network us age patterns and help them to define and anticipate new s ubs criber beha viours . O penwave's traffic management s olution will als o allow B ouygues T elecom to offer a variety of tiered s ubs criber plans tha t reflect a ctual us age. W ith O penwave's traffic ma nagement s olution, B ouygues T elecom will be able to apply a policy for each s ubs criber initia ted IP s es s ion including: Acces s control bas ed on des tination IP and port of content or application being reques t. Acces s control bas ed on s ubs criber plan/level of s ervice. S ource/des tina tion network addres s trans lation (NAT ). Monitoring of predefined time a nd volume s es s ion limits . T he O penwa ve tra ffic ma nagement s olution will a ls o a llow informa tion to be logged on each IP s es s ion to enable 'hot-billing' bas ed on duration a nd volume cons umed, giving B ouygues T elecom the ca pability to control network res ources that bind s ervice tiers to rea l-time parameters , and provides a framework for even more s ophis ticated and proa ctive a ll IP policy management going forward. LookS ma rt L td. reported un-audited cons olidated earnings res ults for the third quarter and nine months ended S eptember 30, 2009. R evenues for the third quarter of 2009 were $12.5 million, a 19% decrea s e from $15. 4 million in the third quarter of 2008 and a 5% decrea s e from $13. 2 million in the s econd quarter of 2009. Net los s for the third quarter of 2009 was $1.9 million, or $0.11 los s per s ha re. T his is compa red to a net los s for the third quarter of 2008 of $1. 7 million, or $0. 10 los s per s hare. Net los s for the s econd quarter of 2009 was $1. 3 million, or $0.08 per s ha re. Los s from continuing operations for the third qua rter of 2009 was $2. 1 million, which includes $0. 3 million of s everance expens e and $0.2 million of expens es rela ted to the evalua tion of s trategic growth a lterna tives or $0. 12 ba s ic and diluted los s from continuing opera tions compared to a los s from continuing operations in the third quarter of 2008 of $1.7 million, which included $0.2 million of s evera nce expens e or $0.10 bas ic and diluted los s from continuing operations of previous year period. Non-G AAP net los s for the third qua rter of 2009 was $1. 7 million compa red to a los s of $1. 0 million in the third quarter of 2008. Non-G AAP net los s for the s econd quarter of 2009 was $0. 7 million. C apital expenditures , including ca pita liza tion of internally developed s oftware, in the third quarter of 2009 were $0. 6 million, compared to $1.2 million in the third qua rter of 2008, and $0.4 million in the s econd qua rter of 2009. Net cas h us ed in opera ting activities for the three months ended S eptember 30, 2009 was $2. 2 million. T he compa ny announced the appointment of J ea n-Y ves Dexmier as the E xecutive C ha irma n of the B oard of Directors . Dr. Dexmier ha s s erved on the company's B oa rd of Directors s ince 2007 and ha s s erved as the C ha ir of both the Audit and S tra tegic Direction committees .
Neteas e.com Inc. (Nas daqG S : NTE S )
Neteas e.com Inc. La unches New G ame C hannel G ame.163. com Northgate T echnologies L imited R eports Una udited C ons olidated and S tandalone E arnings R es ults for the S econd Q uarter and S ix Months E nded S eptember 30, 2009
Northgate Technologies L imited (B S E :590057)
Openwave S ys tems Inc . (Nas daqG S :OP WV)
B ouygues T elecom S elects O penwave S ys tems to Manage and O ptimiz e Network T ra ffic
L ookS mart, L td. (Nas daqG M: L OOK )
LookS ma rt L td. R eports U n-Audited C ons olida ted E arnings R es ults for the T hird Q ua rter a nd Nine Months E nded S eptember 30, 2009 ; Announces Appointment of J ea n-Y ves Dexmier as the E xecutive C hairman of the B oard of Directors
Tencent Holdings L td. (S E HK : 700)
T encent H oldings Ltd. P rovides E a rnings G uidance for the T hird Q ua rter of 2009
T encent Holdings Ltd. provided earnings guidance for the third quarter of 2009. T he company is predicted to a chieve a n online game revenue of C NY 1. 43 billion in the third quarter of 2009, up 15% quarter on quarter. T he company is expected to ga in a tota l revenue of C NY 3. 28 billion and a net profit of C NY 1.34 billion in the qua rter. IceW E B Inc. (O T C B B : IW E B ) acquired 19.31% s take in V O IS , Inc. (O T C B B : V O IS ) for $0. 64 million in cas h on November 3, 2009. In addition to the cas h cons ideration, V O IS will ha ve acces s to IceW E B ’s cloud s tora ge network and will be able to dis tribute IceMAIL , IceP O R T AL, and IceS E C UR E to exis ting and pros pective new us er bas e. Mark B . Lucky, C hief F inancia l O fficer of IceW E B , has tak en a B oard pos ition on V O IS and will cha ir the Audit C ommittee. IceW E B Inc. (O T C B B : IW E B ) completed the a cquis ition of 19. 31% s ta ke in V O IS , Inc. (O T C B B : V OIS ) on November 3, 2009.
Ic eWE B Inc. (OTC B B : IWE B ); VOIS , Inc . IceW E B Inc. (O T C B B : IW E B ) acquired 19. 31% s take in V O IS , Inc. (O T C B B : V O IS ) for $0.64 million. (OTC B B : VOIS )
Ic eWE B Inc. (OTC B B : IWE B ); VOIS , Inc . V O IS , Inc. a nnounced tha t it has received $0. 05 million in V O IS , Inc. (O T C B B : V O IS ) announced a private placement of 160,000, 000 s hares of common s tock at $0.0003 per s hare to funding from IceW E B , Inc. IceW E B , Inc. for gros s proceeds of $48, 000 on November 3, 2009. T he purcha s er is an accredited inves tor and an affiliate (OTC B B : VOIS ) of Mark B . Lucky, a member of the B oard of Directors . T he s hares were is s ued purs ua nt to R egulation D under the S ecurities Act. T he compa ny did not pay any commis s ions or finder’s fees . IceW E B will a ppoint new directors to the company.
Figure 7a. Key Developments Source. Capital IQ
Page 9
K ey Developments - c ontinued
C ompany
Quepas a C orp. (OTC B B : QP S A)
Headline
Q uepas a and Mexico's T ouris m B oa rd Announce S ocial Media Marketing Initiative
Notes
Q uepas a C orp. a nnounced tha t it will be colla borating with Mexico's T ouris m B oard, officially known as the C ons ejo de P romocion T uris tica de Mexico, S A de C A, with regards to an online initiative aimed a t promoting touris m to Mexico. As part of this progra m, Q uepa s a will promote Mexico's beautiful touris t des tinations via online communities , which will index content rela ted to s pecific des tina tion and facilitate us er interaction via blogs and vira l tools . At the s ame time, Q uepa s a and Mexico's T ouris m B oard will be a pproa ching online travel a gencies , hotels and a irlines with rega rds to s pons oring a broader vira l campa ign us ing the Q uepa s a Dis tributed S ocial Media pla tform.
G iant Interac tive G roup, Inc. (NYS E :G A)
G ia nt Intera ctive L aunches B D-C onnect(T M) for B lu-ra y
G ia nt Intera ctive G roup, Inc. announced the North America n ava ilability of B D-C onnect(T M), the world's mos t widely us ed B D-L ive s olution. T he flexible, eas y to us e ga teway to content a nd cus tomers is the eas ies t B D-L ive technology to implement, is pre-configured with more features than competing s olutions and ready to go. Alrea dy featured on more than 400 titles in E urope a s dyna micHD, a nd availa ble in North America exclus ively through G iant, B D-C onnect s oftwa re for adding robus t web-connected interactive fea tures to B lu-ray Dis cs is a ctive a nd in us e on more B lu-ra y titles worldwide tha n any other B D-Live platform. T he technology is already a hit with E uropea n cons umers and content producers , and it arrives in North America as a compelling a nd thoroughly proven gatewa y to cus tomers and content. B D-C onnect works s eamles s ly with community-driven web s ites s uch a s C B S -B DLive.com, T witter a nd F acebook. O ther noteworthy fea tures include a highly s ca la ble a rchitecture with Aka ma i edge s erver content delivery, a llowing for ra pid loa ding of geo-targeted B D-Live components with full s creen progres s ive s treaming video, HD downloa ds , s ynched movie viewing experiences , us er genera ted quizz e tracks , photo ga lleries , marketing banners , R S S feeds and menu widgets .
IAC /InterActiveC orp. (Nas daqG S : IAC I)
IAC /InterActiveC orp. Announces C es s a tion of G regory R . O n November 2, 2009, G regory R . B latt ceas ed to be an executive officer of IAC /InterActiveC orp. as a res ult of his reduced B la tt a s E xecutive O fficer role at the IAC corporate level. Mr. B la tt will continue in his role as C hief E xecutive Officer of Ma tch.com, a s ubs idiary of IAC . IB 3 Network s Inc. Announces R es ignation of T renton Argobright a s C hief T echnology O fficer W ebz en Inc. Announces E arnings R es ults for the T hird Q uarter and Nine Months E nded S eptember 30, 2009 IB 3 Network s Inc. a nnounced tha t T renton Argobright res igned his pos ition of chief technology officer. H e will remain as chief technology officer and s enior network E ngineer of wholly owned s ubs idiary iB ea m S olutions LLC . W ebz en Inc. announced ea rnings res ults for the third quarter and nine months ended S eptember 30, 2009. F or the quarter, the company reported s a les of K R W 6,716 million compared to K R W 6, 879 million for the s ame period las t yea r. O perating income was K R W 355 million compared to operating los s of K R W 603 million for the s ame period las t yea r. P rofit from continuing operation before corporate income tax was K R W 367 million compa red to K R W 1,988 million for the s ame period la s t year. Net income wa s K R W 138 million compared to K R W 1, 843 million for the s a me period las t year.
IB 3 Networks , Inc. (OTC B B :IB NW) Webzen Inc . (K OS E : A069080)
L iveWorld Inc. (OTC P K :L VWD)
LiveW orld Inc. reported $2. 5 million in total revenues and net income of $7,000 for the third quarter of 2009 as compared to LiveW orld Inc. R eports Una udited E arnings R es ults for the T hird Q ua rter a nd Nine Months E nded S eptember 30, $2. 7 million in total revenues and net los s of $602, 000 for the third qua rter of 2008. T he company s a w lower revenues as a 2009 res ult of fewer new client acquis itions , which was pa rtia lly offs et by new projects from exis ting clients . T he $609,000 increas e in the net income was attributable to efficiencies the company has been a ble to obtain in the delivery of s ervices to clients . On a non-G AAP bas is , the company reported net income of $189, 000 for third quarter of 2009, which wa s a n improvement of $541,000 from the $352, 000 net los s for the third quarter of 2008. Income from operations wa s $3,000 aga ins t los s from operations of $622, 000 a year ago. Los s before tax was $5,000 aga ins t $618, 000 a year ago. Net cas h provided by opera ting activities wa s $100,000 aga ins t net cas h us ed in operating a ctivities of $294,000 a yea r ago. Adjus ted E B IT DA wa s $189,000 aga ins t adjus ted LB IT DA of $352, 000 a year a go.
Figure 7b. Key Developments – continued Source. Capital IQ
Page 10
K ey Developments - c ontinued
C ompany
United Online Inc. (Nas daqG S : UNTD)
Headline
United O nline Inc. R eports C ons olidated Unaudited E arnings R es ults for the T hird Q ua rter a nd Nine Months E nded S eptember 30, 2009; P rovides E arnings G uidance for the F ourth Q ua rter a nd F ull Y ea r of 2009; Declares Q uarterly C a s h Dividend P a yable on November 30, 2009; Net Debt as at S eptember 30, 2009
Notes
United O nline Inc. reported cons olidated unaudited earnings res ults for the third quarter and nine months ended S eptember 30, 2009. F or the qua rter, the company reported revenues were $216. 2 million, a n increas e of 28% vers us the year-ago qua rter. T he increas e was attributable to the company's acquis ition of F T D on Augus t 26, 2008. Net income applica ble to common s tockholders wa s $14. 9 million or $0. 18 diluted net income per common s hare aga ins t net income applicable to common s tockholders of $15. 2 million or $0. 20 diluted net income per common s hare for the s a me quarter a year ago period. Income before income taxes was $26.2 million a gains t $26. 6 million for the s ame quarter a year ago period. O perating income was $32.6 million a gains t $28. 8 million for the s ame qua rter a year a go period. C a s h flows from opera tions and free cas h flow were $28.2 million and $23.5 million, a decreas e of 20% and 25% , res pectively vers us the yea r-ago quarter. T he decreas e in cas h flows was primarily a ttributable to changes in working capital. P urcha s es of property and equipment were $4. 8 million aga ins t $4. 2 million for the s ame qua rter a year a go period. Adjus ted net income applica ble to comm income per common s ha re a gains t $25. 4 million or $0. 34 diluted net income per common s hare for the s a me quarter a yea r ago period. T he compa ny provided earnings guidance for the fourth quarter and full year of 2009. F or the quarter, the company expects adjus ted O IB DA to be in the range of $56.0--$61.0, revenues in the range of $235. 0--$243. 0 and G AAP opera ting income in the ra nge of $29.1--$34.1. F or the year, the company expects a djus ted O IB DA to be in the range of $243.5--$248.5, revenues in the range of $975.6--$983. 6 and G AAP operating income in the ra nge of $142.3--$147. 3. T he compa ny's B oard of Directors recently decla red a quarterly cas h dividend of $0. 10 per s hare that is paya ble on November 30, 2009 to s tockholders of record on November 13, 2009. Net debt at S eptember 30, 2009 was $252. 6 million, a decreas e of $12.5 million vers us $265. 1 million at J une 30, 2009.
The9 L imited (Nas daqG S :NC TY)
G la ncy B inkow & G oldberg L LP F iles a C las s Action G la ncy B inkow & G oldberg L LP has filed a cla s s action laws uit in the United S ta tes Dis trict C ourt for the S outhern Dis trict of Laws uit on B ehalf of a C las s C ons is ting of All P ers ons or New Y ork on behalf of a clas s cons is ting of a ll pers ons or entities who purchas ed American Depos itary S hares , a s E ntities W ho P urchas ed American Depos itary S hares , of evidenced by American Depos itary R eceipts , of T he9 Limited between November 15, 2006 and J uly 15, 2009, inclus ive (the T he9 L imited 'C las s P eriod'). T he C ompla int charges T he9 and certain of the C ompany's current and former executive officers with violations of federal s ecurities laws . T he9 operates as an online game opera tor and developer in ma inla nd C hina and directly or through a ffiliates operates licens ed multiplayer online role-playing games and adva nced ca s ual games , including S oul of T he Ultima te Na tion, G ranado E s pada and Atlantica, among others . T he C omplaint alleges tha t throughout the C la s s P eriod defendants knew or reckles s ly dis rega rded that their public s tatements concerning T he9's bus ines s , opera tions and pros pects were materia lly fa ls e a nd mis lea ding. S pecifically, the defendants ma de fals e and/or mis lea ding s tatements and/or failed to dis clos e tha t: (i) it was becoming increa s ingly les s likely that the C ompa ny would be renewing the W orld of W arcra ft c E ntertainment Inc. ('B lizz ard'); (ii) T he9 had not even begun formal negotiations with B liz zard regarding the W orld of W arcra ft contract renewal; (iii) T he9 and B lizz ard had been at odds regarding T he9's operation of W orld of W a rcraft in C hina; a nd (iv) the equity inves tment in T he9 by E lectronic Arts Inc.--a developer and publis her of interactive enterta inment--had made it les s likely that B liz za rd would renew the W orld of W arcra ft contract beca us e B liz za rd would es s entially be doing bus ines s with one of its greates t competitors .
C hines e G amer International (G TS M: 3083)
C hines e G amer Interna tional S igns G ame Licens ing Agreement with C ha ngyou. com
C hines e G a mer Interna tiona l announced an over R MB 100 million (approx. $14. 7 million) licens ing agreement with C hangyou. com Limited, whereby C ha ngyou. com will receive the exclus ive right from the company to operate Zhong Hua Y ing X iong, a new 3D martial-a rts game, in mainland C hina. C hines e G amer a ls o plans to grab more s hares in the va s t C hines e online game market in the future through work ing clos ely with C hangyou.com on the res earch and development of new games . W iz za rd Media a nnounced the launch of 24 new iP hone(R ) Apps availa ble for s ale in the App s tore including Inves tors B us ines s Da ily E ditoria ls and Alas k a H DT V . T he newly launched Apps a re iP hone companion Apps for popular podca s ts on the W izz ard Media Network, offering a udiences one-click acces s to the podcas t directly on their iP hone or iP od T ouch(R ), bonus content and new s ocial communica tion features creating a n unprecedented level of audience engagement. W iz zard recently announced 2009 third quarter network numbers of 12, 281 podca s ts downloa ded 332 million times in the qua rter by over 18 million unique monthly audience members . Approxima tely 70% of the audience for podca s ts s ubs cribe through iT unes (R ) from which us ers download podca s ts for their iP hone a nd iP od(R ). U ntil recently, W iz za rd's only means to derive R evenue was through podcas t publis hing s ervices as well a s a dvertis ing s ales . W ith the la unch of the iP hone App s tore in iT unes , W iz zard created a unique iP hone App that can be quickly cus tomized for each podcas t and allows podca s t publis hers to genera te a new revenue s tream by ma rketing their own iP hone App directly to their audience.
Wizzard S oftware C orporation (AME X:W ZE )
W iz za rd Media L aunches 24 New iP hone Apps
S park Networks , Inc . (AME X:L OV)
S park Networks Inc. R eports F inancial R es ults for the T hird Q uarter E nded S eptember 30, 2009
S park Networks Inc. reported fina ncial res ults for the third quarter ended S eptember 30, 2009. F or the qua rter, the company reported revenue of $11. 1 million, a decreas e of 21% compared to $14.0 million in the third qua rter of 2008. C ontribution for the third quarter of 2009 wa s $8.0 million, a decreas e of 25% compared to $10.6 million for the third quarter of 2008. Net income was $1 million, or $0. 05 per s hare, compared to $1.7 million, or $0.08 per s hare, for the third qua rter of 2008. Adjus ted E B IT DA was $2. 6 million, a decreas e of 36% compared to $4.1 million for the third quarter of 2008. DigitalP os t Interactive Inc. announced its rebranded and cus tomized interactive platform was la unched for F amilyDrive.com, a new pa rtner providing pers ona l, priva te and a d-free s ha ring a nd pres ervation of family pictures , videos , and other digital memories . Digita lP os t's interactive platform and s oftware development provided F amilyDrive. com with new technology capa bilities to not only s erve their exis ting cus tomers but a ls o rea ch out to new family cus tomers . T he F amilyDrive. com web s ite wa s cus tom-des igned to provide a place where fa milies ca n depend on pers onal s ervice and cutting-edge technology for s haring and s toring their precious family memories . S pectrumDNA Inc. a nnounced tha t J eff Nolan ha s been appointed to its board of directors . Nolan is a n entrepreneur, venture ca pitalis t and s ocial media s trategis t. He wa s venture partner for S AP V entures , founded the E nterpris e Irregulars B logging C ommunity, s erved as director of the Apollo S trategy G roup for S AP G lobal Mark eting, and mos t recently was vice pres ident of corpora te development at News G a tor T echnologies . Q uepas a C orp. a nnounced the formation of a cros s -functiona l team dedicated to e-ma il management and deliverability. As part of this initia tive, the company hired T ony P atti a s Director of Deliverabilty. T ony is a recogniz ed leader in the field of ema il deliverability. W ith a record of s ucces s s panning over a decade, T ony has developed focus ed, cus tomiz ed delivera bility s olutions for s uch brands as T ra velocity. com a nd T rue. com, helping them a chieve unprecedented delivery-to-inbox rates . As an expert in e-mail marketing, IS P relations , and the lates t in indus try trends a nd s tanda rds , T ony's delivera bility s tewards hip ens ures tha t Q uepa s a's vital marketing inves tment pays - ins tea d of being los t in s pa m filters .
DigitalP os t Interactive, Inc . (OTC B B : DG L P )
DigitalP os t Interactive Launches Digital Media-S haring P la tform for F amilyDrive.com
S pec trumDNA, Inc. (OTC B B : S P XA)
S pectrumDNA Inc. Appoints J eff Nolan to its B oa rd of Directors
Quepas a C orp. (OTC B B : QP S A)
Q uepas a C orp. Appoints T ony P a tti as Director of Deliverabilty
Figure 7c. Key Developments – continued Source. Capital IQ
Page 11
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-eight of the 89 companies have market caps under US$100 million, with 39 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$32.6 billion.
Market C ap (US D m)
Tenc ent Holdings Ltd. Neteas e.c om Inc . S handa Interac tive Entertainment Ltd. Modern Times G roup Mtg A B G ree, Inc . IA C/InterA c tiveCorp. Perf ec t World Co. , Ltd. S ohu.c om Inc . Open Tex t Corp. Changy ou. c om Limited G iant Interac tive G roup, Inc . Mix i, Inc . Chines e G amer International K ings of t Co. Ltd. V alueClick Inc . United Online Inc . NEOWIZ G ames Corporation S hutterf ly, Inc . NetDragon WebS of t, Inc . CDC Corp. G ungHo Online Entertainment, Inc . S K Communic ations Co. , Ltd. XING A G OA O R B C Information S ys tems G amania Digital Entertainment Co. , Ltd. GigaMedia Ltd. My riad G roup A G The9 Limited Openw ave S y s tems Inc . DA DA S pA A c toz S oft Co. , Ltd. Y D Online Corp. Fluid Mus ic Canada, Inc . Tree.Com, Inc . Cy berplex Inc . GeoS entric Oy j G ameOn Co Ltd. TheS treet. c om, Inc . NeuLion Inc orporated Frogs ter Interac tive Pictures A G HanbitS of t, Inc . PNI Digital Media Inc . S park Netw orks , Inc . G ravity Co., Ltd NeXplore Corporation DX N Holdings B hd Ngi Group Inc . Webz en Inc . Eolith Co. Ltd. A Q Interac tive, Inc . S oc ialw is e, Inc . Wiz z ard S of tw are Corporation Northgate Technologies Limited Dolphin Digital Media, Inc . A cc eleriz e New Media, Inc . LookS mart, Ltd. Y nk K orea Inc . Quepas a Corp. J umbuc k Entertainment Limited DigitalTow n, Inc . Lingo Media Corporation Ex tens ions , Inc . is eemedia Inc . IA S Energy, Inc . MOK O. mobi Limited S pec trumDNA , Inc . UOMO Media, Inc V OIS , Inc . CornerWorld Corporation B right Things plc Worlds .c om Inc . S NA P Interac tive, Inc . Magnitude Inf ormation S y s tems Inc . B ey ond Commerce, Inc . DigitalPos t Interac tive, Inc . B roadWebA s ia Inc . B igs tring Corp. Wy nds torm Corporation LiveWorld Inc . B etaw ave Corporation Unis erve Communic ations Corp. K A B Dis tribution Inc . CLICK ER Inc . A s s oc iated Media Holdings Inc . The Parent Company China G atew ay Corporation S NM G lobal Holdings Dibz International, Inc . S oc ial Media V entures Inc . 0
Figure 8. Market Cap Ranking Source. Capital IQ
32555. 5 5435. 9 3390. 3 3056. 7 2708. 5 2587. 9 2473. 2 2225. 1 2201. 1 1822. 7 1648. 5 1275. 1 1151. 5 1074. 8 906. 4 704. 6 693. 4 399. 2 351. 2 267. 1 263. 2 250. 9 249. 4 222. 0 211. 0 208. 3 205. 4 197. 7 179. 6 174. 5 112. 1 89.5 86.8 84.8 84.2 78.9 78.1 75.0 72.8 70.0 65.7 55.4 55.0 43.6 41.8 41.1 36.8 36.6 34.6 28.8 24.3 23.7 22.4 21.5 21.0 20.0 18.0 17.8 14.5 13.7 11.2 11.1 9.2 8.5 7.9 7.3 6.9 6.2 5.7 5.4 5.2 4.3 4.1 3.5 3.5 2.5 2.0 1.8 1.1 0.9 0.8 0.6 0.5 0.4 0.2 0.0 0.0 0.0 0.0 500 1,000 1,500 2, 000 2, 500 3, 000 3, 500 4, 000
Page 12
TEV/Revenue (LTM) averages 5.4x: The overall average TEV/Revenue (LTM) multiple for our group is 5.4x (vs. 5.3x last week) (Figure 9). W e continue to see four companies trading above 25x revenue – Bigstring Corp. (OTCBB:BSGC) at 48.2x, Dolphin Digital Media, Inc. (OTCBB:DPDM) at 38.6x, NexPlore Corporation (OTCPK:NXPC) at 27.0x, and Tencent Holdings Ltd. (SEHK:700) at 25.8x. The median of 1.8x compares with 1.7x last week. Note that we exclude multiples greater than 50x. Thirty-one companies have multiples under 1.5x.
T E V/L T M R evenue (x)
60. 0
50. 0
48.2
40. 0
38.6
30. 0
27.0 25.8
20. 0
A10. 0 verage, 5.4
3.3 3.3 3.4 2.3 2.4 2.4 2.5 2.8 2.9 3.2 1.2 1.3 1.3 1.4 1.4 1.7 1.8 1.9 0.0 0.0 0.0 0.1 0.2 0.2 0.2 0.3 0.3 0.3 0.4 0.5 0.7 0.7 0.7 0.7 0.7 0.7 0.8 0.8 0.9 0.9 0.9 1.0 1.0 1.1
5.8 5.9 4.5 4.7 5.2 5.5
7.1 7.7
8.4 8.6
14.515.4 13.2 12.4 10.0 9.3
15.7
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 (18), trading at an average multiple of 12.4x (vs. 12.6x last week). On a geographic basis, the United States has the most companies (38), trading at an average of 7.3x revenue (vs. 6.9x last week) (Figure 11). Ten of the companies are Canadian (average 4.0x revenue).
Average TEV/LTM Revenue - By Exchange
16.0 14.5 14.0 12.4 12.0 11.9 10.0 (x) 8.0 6.0 4.0 2.0 OTCBB OTCPK GTSM 0.0 HLSE SEHK TSX
(x) 16.0 14.0 12.0 10.0
NasdaqGM
TSE
OSE
CM
NasdaqGS
KOSE
RTS
OM
XTRA
AMEX
TSXV
KLSE
SWX
ASX
BSE
Germany
Hong Kong
Finland
China
Canada
India 1
Australia
# Companies
1 18 3
2 11 4
2
5
2
4
1
2
1
1 14 6
1
1
1
5
1
# Companies 1 10 38 3 2 2 6 10
Switzerland
1
1
8
1
1
Malaysia
Sweden South Korea
Taiwan
1
Figures 10 & 11. TEV/Revenue Ranking (Exchange, Country) Source. Capital IQ
Russia 1
United States
Japan
Italy
C hina G atewa y C orporation G a meO n C o Ltd. O AO R B C Information S y s tems AQ Intera ctive, Inc . T heS treet.com, Inc . T he P a rent C ompany C LIC K E R Inc. N orthgate T echnologies L imited T ree.C om, Inc. U nis erve C ommunications C orp. O penwave S y s tems Inc . J umbuc k E nterta inment L imited DXN Holdings B hd IAC /InterAc tiveC orp. C y berplex Inc . C DC C orp. G igaMedia Ltd. Ac toz S oft C o. , Ltd. S NAP Intera ctive, Inc. B ey ond C ommerc e, Inc. H anbitS oft, Inc . P erfect World C o., Ltd. DADA S pA United O nline Inc . S pa rk N etwork s , Inc . S N M G loba l Holdings G a mania Digital E ntertainment C o., Ltd. S hutterfly , Inc . S K C ommunica tions C o., Ltd. V alueC lic k Inc . Y nk K orea Inc . Y D O nline C orp. Modern T imes G roup Mtg AB G ungHo O nline E ntertainment, Inc. NetDra gon WebS oft, Inc . C ornerWorld C orporation E olith C o. Ltd. P N I Digital Media Inc. O pen T ex t C orp. NeuLion Inc orporated My riad G roup AG N E O WIZ G ames C orporation XIN G AG S ohu.com Inc . S ocial Media V entures Inc . Wiz z ard S oftware C orporation is eemedia Inc . DigitalP os t Intera ctive, Inc. Acceleriz e New Media , Inc . C hangy ou.com L imited F rogs ter Intera ctiv e P ictures AG K ings oft C o. Ltd. Mix i, Inc . Lingo Media C orporation UO MO Media, Inc MO K O .mobi L imited G ree, Inc . As s ociated Media Holdings Inc . G eoS entric O y j F luid Mus ic C a nada , Inc. C hines e G amer Interna tional T encent Holdings Ltd. NeX plore C orporation Dolphin Digital Media, Inc. B igs tring C orp.
0. 0
Average TEV/LTM Revenue - By Country
14.5
8.5
7.7 6.3 5.3 5.2 5.2 4.2 3.2 2.8 1.9 1.8 1.7 1.7 0.9 0.7
8.0 6.0 4.0
7.7
7.3 5.9 5.3 5.2 4.6 4.0 3.2 1.8 1.7 0.9 0.7 0.7 0.3 0.0
0.3 0.2
0.0
2.0 0.0
Page 13
TEV/EBITDA (LTM) averages 11.8x: The average multiple for the 35 companies with positive EBITDA (and multiples under 100x) is 11.8x LTM EBITDA (vs. 10.6x last week), led by HanbitSoft, Inc. (KOSE:A047080) 36.9x multiple (Figure 12). Twelve companies have EBITDA multiples under 7x. The median multiple is 9.6x (vs. 8.6x last week).
T E V/L T M E B IT DA (x)
40. 0 35. 0 30. 0 25. 0 25. 0 20.0 20. 0 15. 0 A verage, 11. 8 10. 0 5. 0 0. 0 G ameO n C o L td. 2. 9 3. 1 8. 0 8. 0 8. 6 7.0 7.5 7. 7 6. 2 6.6 4. 9 5. 4 5. 7 4. 5 9. 6 13. 6 12. 7 13. 3 11. 5 11. 6 12. 3 10. 5 10. 6 10. 8 17.5 23. 1 21.3 36. 4 36. 9
27. 0
1. 1 1. 5 0. 2 0. 4 J umbuck E ntertainment L imited O AO R B C Information S y s tems P erfec t World C o. , L td.
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 .
C hines e G amer International
U nis erve C ommunications C orp.
C hangy ou. c om L imited
S K C ommunic ations C o. , Ltd.
T ree. C om, Inc .
C DC C orp.
Modern T imes G roup Mtg AB
S NAP Interac tive, Inc .
T heS treet. c om, Inc .
U nited O nline Inc .
S park Network s , Inc .
O pen T ex t C orp.
NetDragon WebS oft, Inc.
IAC /InterAc tiveC orp.
S ohu. c om Inc .
Y D O nline C orp.
V alueC lic k Inc .
C yberplex Inc.
O penwave S y s tems Inc.
G ree, Inc .
XING AG
Mix i, 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 (18), trading at an average multiple of 2.9x. On a geographic basis, the United States has the most companies (38), trading at an average of 7.2x EBITDA (Figure 14). Ten of the companies are Canadian (average 19.2x EBITDA).
Average TEV/LTM EBITDA - By Exchange
35.0 29.8 30.0 25.0 (x) 20.0 15.0 10.0 5.0 GTSM NasdaqGS SEHK TSE KOSE OSE 0.0 TSXV OM XTRA CM TSX 17.3 16.0 15.5
Actoz S oft C o. , L td.
Average TEV/LTM EBITDA - By Country
25.0 20.0 15.0 19.2 17.3
12.8 12.7 11.6
(x)
16.0
13.8
8.6 8.6 7.0 6.6
5.8 4.9 NasdaqGM AMEX
10.0
2.9 1.1 OTCBB ASX 0.4
12.7 11.6
K ings oft C o. L td.
10.5
8.9
7.2 7.0 1.1
5.0
RTS
H anbitS oft, Inc.
Y nk K orea Inc.
S hutterfly , Inc.
DADA S pA
0.0 Germany Japan China Hong Kong Canada United States South Korea Italy Australia 2 Taiwan Sweden
0.4 Russia 1
# Companies
4
2
6
5
3
1
2
1
14
1
4
5
2
18
2
1
# Companies
10
3
8
6
1
2
1
10
38
1
Figures 13 & 14. TEV/EBITDA Ranking (Exchange, Country) Source. Capital IQ
Page 14
P/E (LTM) averages 18.6x: The average multiple for the 33 companies with positive earnings (and multiples under 100x) is 18.6x LTM EPS (vs. 18.8x last week), led by Tencent Holdings Ltd. (SEHK:700) with a 66.5x multiple (Figure 15). Fourteen companies have P/E multiples under 10x. The median is 12.3x.
P /E L T M (x)
70.0 61.9 60.0 48.0 56.9 66.5
50.0 40.0 30.0 20.0 A verage, 18.6 8.2 9.5 20.0 15.0 15.9 16.4 13.1 14.3 11.0 11.7 12.3 21.4 22.5
45.8 35.3 36.1 25.6
10.0 0.0 0.0 0.0 G ravity C o., Ltd W ebz en Inc. 2.0 2.3 G iant Interactive G roup, Inc. T he9 Limited 2.4 3.1 3.5 S handa Interactive E ntertainment Ltd. Neteas e.com Inc. P erfect World C o., Ltd.
4.1 J umbuck E ntertainment Limited
6.0
7.5 7.7 7.8
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
S NAP Interactive, Inc.
G ameO n C o Ltd.
O pen T ex t C orp.
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 (18), trading at an average multiple of 13.8x. On a geographic basis, the United States has the most companies (38), trading at an average of 13.4x earnings (Figure 17). Ten of the companies are Canadian (average 27.8x EPS).
Average P/E - By Exchange
60.0 56.9 50.0
(x)
40.0 (x) 30.0 20.0 10.0
38.5
34.1
28.9
25.6 18.3 16.4 15.0 13.8 11.5 7.5
6.0 KLSE
4.1 ASX
2.0 NasdaqGM 0.0 NYSE
Germany
Canada
Japan
United States
China
Malaysia
OTCBB
GTSM
Taiwan
South Korea
NasdaqGS
Australia
SEHK
KOSE
OSE
TSE
OM
Sweden
# Companies
1
5
3
2
2
6
1
2
18
14
4
1
2
1
5
# Companies
6
10
2
3
1
10
38
8
1
2
Switzerland 1
XTRA
AMEX
TSX
Figures 16 & 17. P/E Ranking (Exchange, Country) Source. Capital IQ
Italy 1
0.0
50.0 45.0 40.0 35.0 30.0 25.0 20.0 15.0 10.0 5.0 0.0
Average P/E - By Country
43.1
27.8 25.6
22.0 16.4 14.1 13.4 12.2 6.0 4.1 0.0 0.0
T encent H oldings Ltd.
C y berplex Inc.
G igaMedia Ltd.
S park Network s , Inc.
IAC /InterActiveC orp.
Y D O nline C orp.
Worlds .com Inc.
S ohu.com Inc.
H anbitS oft, Inc.
Actoz S oft C o., Ltd.
K ings oft C o. Ltd.
G ree, Inc.
XING AG
Mix i, Inc.
Page 15
UPCOMING EVENTS
E arnings C alendar
C ompany
Cyberplex Inc. (TSX:CX) Perfect World Co., Ltd. (NasdaqGS:PWRD) Netease.com Inc. (NasdaqGS:NTES) The9 Limited (NasdaqGS:NCTY)
Figure 18. Earnings Calendar Source. Company reports
Date
10-Nov-09 16-Nov-09 18-Nov-09 23-Nov-09
Time
4:30 p.m. EST 7:00 a.m. EST 8:00 p.m. EST 8:00 p.m. EST
Quarter
Q3/09 Q3/09 Q3/09 Q3/09
C onf C all Details
888-892-3255 800-819-0121 877-941-1427 800-884-5695
Page 16
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 Limited 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 entures 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 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 ynds torm C orpora tion XING A G Y D Online 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 US D C AD 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 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 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 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 P K XT R A K OS E K OS E US D Market C ap ($m) 21.0 112.1 28.8 0.4 2.0 0.9 3.5 5.4 2.5 267.1 1, 822.7 0.0 1, 151.5 0.5 5.7 84.2 174.5 41.1 0.0 3.5 13.7 21.5 34.6 11.1 86.8 70.0 211.0 78.1 78.9 1, 648.5 208.3 43.6 2, 708.5 263.2 65.7 2, 587.9 8.5 9.2 14.5 0.6 1, 074.8 11.2 1.1 20.0 4.1 1, 275.1 3, 056.7 7.9 205.4 693.4 351.2 5, 435.9 72.8 41.8 36.8 22.4 2, 201.1 179.6 2, 473.2 55.4 17.8 222.0 3, 390.3 399.2 250.9 4.3 0.0 0.0 24.3 2, 225.1 55.0 7.3 32,555. 5 0.2 197.7 75.0 84.8 0.8 704.6 6.9 906.4 6.2 36.6 23.7 5.2 1.8 249.4 89.5 18.0 C urrent P ric e 0.75 15, 450 47, 400 0.01 0.03 0.03 0.07 0.01 0.03 2.52 33.14 0.00 444.00 0.01 0.06 1.40 7.35 0.63 0.00 0.05 0.50 0.40 570.00 0.25 1.80 18.66 45.05 72, 200 0.06 7.28 3.82 1.57 5, 410 205, 400 3, 580 19.61 0.12 0.19 0.34 0.01 7.62 0.98 0.04 1.17 0.01 740,000.00 323.00 0.09 4.79 39,250.00 5.15 42.00 0.68 0.75 26,600.00 30.85 39.04 2.15 49.08 1.76 1.40 1.60 50.41 15.55 7,150.00 0.40 0.00 0.01 0.55 57.86 2.67 0.15 139 0.01 7.88 2.45 7.78 0.04 8.33 0.08 10.40 0.01 3.09 0.47 0.10 0.10 32.30 7,120.00 4,020.00 1 Wk 36.4% 6. 6% 1. 3% 11.1% -2.9% -1.6% -14.6% -9.1% 0. 0% 7. 2% 9. 2% -86.7% 4. 2% -23.5% 0. 0% 0. 7% 4. 0% -0.8% 20.0% -10.0% -50.5% 0. 0% 7. 5% -37.5% 0. 6% -2.0% 0. 6% -15.3% 20.0% 0. 3% -4.0% 0. 0% 6. 3% -2.9% 4. 7% 3. 1% 9. 1% 31.0% 0. 0% -50.0% 1. 5% 3. 2% -12.5% -9.3% -18.2% -5.2% 5. 2% -4.4% -2.0% 1. 7% 7. 5% 11.4% -2.9% 0. 0% -3.4% 5. 3% 5. 7% 4. 4% 13.5% -2.2% 16.7% 0. 0% 11.5% 9. 2% 1. 4% 90.5% 0. 0% 6. 8% 10.0% 7. 0% -7.3% 0. 0% -2.9% 0. 0% 0. 8% 1. 7% -3.4% -30.0% 6. 0% 5. 3% 12.9% 87.5% 2. 0% 9. 3% 0. 0% 0. 0% -7.4% 4. 6% 3. 1% 90.5% -86.7% 1.2% 0. 7% 1 Mth 25.0% -6.9% -5.0% -28.6% -21.4% -55.0% -56.3% -9.1% -87.0% -1.9% 6.0% -86.7% -2.8% -35.0% 0.0% 12.0% 7.9% 2.4% NM -25.0% -75.0% 14.3% -18.6% -44.4% 33.3% 3.7% -8.1% -18.4% 20.0% 4.6% -21.1% -19.1% 10.4% -7.3% -17.4% 2.8% 100.0% 58.3% -15.0% -99.2% 1.5% 0.0% -30.0% 0.9% 0.0% 13.7% 4.5% 13.2% 7.6% -3.8% 0.2% 3.7% -29.2% 36.4% -3.1% -18.0% 1.3% -19.5% 12.0% -5.4% 2.9% 6.7% 5.3% -7.1% -16.3% 14.3% 0.0% -86.1% -5.2% -10.3% 14.6% -25.0% 7.9% 0.0% 2.5% -18.1% -1.5% -12.5% 2.2% -30.4% -22.7% 50.0% 10.0% 0.0% 0.0% 0.0% -11.3% -15.7% 2.3% 100.0% -99.2% -7.1% -0.8% 3 Mth 31.6% -33.3% -8.7% -28.6% 31.5% -58.0% -75.9% -16.7% -87.0% -4.5% -13.0% -86.7% -2.2% -18.8% 20.0% -17.2% 21.5% 18.9% 20.0% -35.7% -61.5% -11.1% -29.2% 25.0% 44.0% 33.4% -23.1% -30.8% 20.0% -8.4% -19.9% -26.3% 37.5% 1.7% -17.5% 7.1% 3.4% 171.4% -8.1% -99.2% -10.2% -12.5% -36.4% -14.0% 28.6% 14.9% 12.9% 32.3% 14.6% 21.3% -20.8% -6.7% -25.3% 7.1% -19.9% -12.2% 2.8% -19.8% 22.9% 23.9% 0.0% 52.4% 2.1% -0.5% -29.6% 0.0% -70.0% -93.4% -15.4% -8.0% -4.0% -34.8% 18.2% -53.3% -15.4% 7.5% -19.5% -22.2% 11.8% -42.9% -3.2% 36.4% -4.0% -2.1% 11.1% 0.0% 15.4% -22.6% -25.0% 171.4% -99.2% -7.2% -8.0% 6 Mth 50.0% 1. 3% -15.1% 566.7% 43.5% -71.4% -92.4% -28.6% -91.4% 110.0% 21.6% 0. 0% 72.8% 8. 3% -57.1% -17.6% 22.9% 46.5% -88.0% 200.0% -75.0% -43.7% -44.1% 66.7% 200.0% 120.8% 12.6% -22.7% 20.0% -11.0% -35.7% 61.9% 103.4% 44.0% -37.0% 29.4% -57.1% 100.0% -17.1% -98.6% 79.3% -2.0% -53.3% -6.4% -10.0% 76.2% 43.9% 14.7% -5.9% 18.0% -2.8% 36.1% -2.9% 36.4% -16.1% -28.1% 29.1% 77.7% 175.3% 6. 7% 37.3% 62.4% 4. 1% 28.3% -20.1% -50.0% -50.0% 25.0% -16.7% 10.2% 4. 7% -61.5% 90.8% -53.3% -13.2% 29.6% -32.9% -12.5% 23.4% -75.8% 7. 4% 134.4% -3.4% -24.2% -41.2% 11.1% 7. 7% -25.7% -48.6% 566.7% -98.6% 15.9% 4. 1% 1 Yr 87.5% 67.0% 24.7% 233. 3% 32.0% -86. 9% -93. 9% 38.9% -97. 8% 157. 1% NM -80. 0% 458. 5% -96. 8% -70. 0% 250. 0% 9.9% 75.0% -97. 6% 12.5% -75. 0% -55. 6% 5.6% 150. 0% 373. 7% 334. 0% 241. 3% -39. 3% 50.0% 20.5% -28. 5% 135. 4% NM 67.0% 32.3% 23.2% 50.0% 171. 4% -15. 0% -99. 4% 264. 6% -11. 7% -56. 3% -28. 2% -52. 6% 18.4% 113. 2% 115. 0% -31. 6% 479. 3% 99.6% 113. 7% 13.3% -34. 8% -63. 1% -49. 9% 35.8% 230. 8% 190. 2% 25.7% -36. 1% 6.7% 108. 1% 127. 7% 56.1% -46. 7% -99. 2% -99. 1% -70. 3% 33.6% -12. 5% -37. 5% 177. 0% -99. 3% -34. 6% -22. 7% 255. 3% -80. 6% 25.8% -48. 4% 82.1% 0.0% 235. 9% -43. 4% -37. 5% -50. 0% 12.2% 24.3% -32. 4% 479. 3% -99. 4% 44.0% 13.3% 52 Week -6.3% -57.1% -42.9% -50.0% -42.1% -89.1% -96.3% -49.4% -99.0% -35.7% -31.5% -93.3% -14.5% -98.1% -87.2% -29.6% -10.3% -8.7% -97.6% -54.5% -85.7% -57.9% -50.9% -75.2% -16.3% -13.2% -34.5% -52.5% 0.0% -23.9% -50.6% -40.3% -5.3% -26.6% -46.1% -7.8% -57.1% 0.0% -32.0% -99.4% -19.5% -32.9% -86.0% -36.1% -70.0% -6.4% -5.0% -14.0% -34.4% -12.6% -28.0% -13.4% -47.7% -48.3% -68.1% -58.6% -5.8% -31.3% -2.8% -18.1% -40.4% -5.9% -22.4% -14.2% -44.4% -63.0% -99.3% -99.8% -72.5% -20.0% -15.2% -66.7% -8.6% -99.3% -52.6% -34.5% -40.5% -65.0% -11.9% -92.5% -25.4% -67.4% -34.0% -72.8% -56.5% -80.4% -15.0% -42.6% -53.8% 0.0% -99.8% -44.1% -40.5%
794.1
Figure 19. Price Performance Source. Capital IQ
Page 17
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 Limited 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 entures 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 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 ynds torm C orporation XIN G AG Y D Online 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 P orta l S ocial Networking Media Media Media S ocial Networking G aming P odca s ting C ontent 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 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 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 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 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 TREE T S XV :US S U NT D UO MO V CLK V OIS W ZE N W ZE W DDD W Y ND O1B C A052770 A023770
US D Market C ap ($m)
21.0 112.1 28.8 0.4 2.0 0.9 3.5 5.4 2.5 267.1 1,822.7 0.0 1,151.5 0.5 5.7 84.2 174.5 41.1 0.0 3.5 13.7 21.5 34.6 11.1 86.8 70.0 211.0 78.1 78.9 1,648.5 208.3 43.6 2,708.5 263.2 65.7 2,587.9 8.5 9.2 14.5 0.6 1,074.8 11.2 1.1 20.0 4.1 1,275.1 3,056.7 7.9 205.4 693.4 351.2 5,435.9 72.8 41.8 36.8 22.4 2,201.1 179.6 2,473.2 55.4 17.8 222.0 3,390.3 399.2 250.9 4.3 0.0 0.0 24.3 2,225.1 55.0 7.3 32,555.5 0.2 197.7 75.0 84.8 0.8 704.6 6.9 906.4 6.2 36.6 23.7 5.2 1.8 249.4 89.5 18.0 32,555.5 0.0 794.1 41.8
TE V/L TM R evenue
5.8x 0.7x 0.1x 13.2x 48.2x 0.8x 0.7x 5.9x 0.0x 15.7x 0.2x 2.4x 0.7x 0.9x 0.7x 5.5x 38.6x 2.4x 15.4x 7.1x 1.2x 0.0x 14.5x 0.7x 12.4x 1.9x 0.9x 0.7x 5.2x 0.5x 7.7x 8.6x 8.4x 1.8x 10.0x 3.2x 3.3x 2.3x 2.9x 27.0x 0.3x 2.8x 0.4x 0.9x 2.5x 0.0x 1.3x 1.3x 0.8x 1.1x 4.5x 3.4x 1.0x 25.8x 0.2x 0.2x 0.3x 0.3x 1.0x 9.3x 1.4x 4.7x 3.3x 1.7x 1.4x 48.2x 0.0x 5.4x 1.8x
TE V/ NTM R evenue
0.1x 0.8x 4.9x 16.0x 0.6x 0.9x 1.4x 14.7x 1.5x 0.7x 7.3x 0.7x 0.5x 6.3x 2.5x 1.6x 2.4x 0.4x 2.1x 1.0x 1.2x 2.9x 19.6x 0.2x 0.2x 0.3x 1.0x 1.4x 2.6x 1.4x 19.6x 0.1x 3.2x 1.4x
TE V/L TM E B ITDA
3. 1x 10.5x 9. 6x 27.0x 6. 6x 7. 0x 7. 5x 0. 2x 21.3x 8. 6x 36.9x 11.5x 1. 1x 17.5x 25.0x 12.7x 12.3x 8. 0x 10.8x 13.3x 1. 5x 23.1x 0. 4x 10.6x 20.0x 2. 9x 7. 7x 4. 9x 5. 4x 6. 2x 36.4x 4. 5x 5. 7x 11.6x 8. 0x 13.6x 36.9x 0. 2x 11.5x 9. 1x
TE V/NTM E B ITDA
7.3x 7.6x 25.9x 5.2x 6.0x 3.4x 13.3x 4.9x 1.2x 12.1x 8.6x 4.4x 9.0x 3.8x 6.9x 5.7x 6.1x 6.5x 46.8x 12.8x 7.9x 3.9x 5.6x 7.3x 4.8x 46.8x 1.2x 9.1x 6.5x
P /L TM E P S
15.9x 12.3x 35.3x 7.5x 6.0x 22.5x 7.8x 2.0x 8.2x 0.0x 45.8x 56.9x 11.7x 11.0x 4.1x 21.4x 61.9x 16.4x 36.1x 14.3x 3.1x 48.0x 3.5x 2.4x 7.7x 13.1x 15.0x 66.5x 2.3x 0.0x 20.0x 25.6x 9.5x 66.5x 0.0x 18.6x 12.3x
P /NTM E P S
8.5x 10.6x 22.0x 8.4x 16.5x 1.6x 15.2x 7.7x 26.1x 28.7x 3.0x 16.1x 49.5x 12.4x 11.4x 1.2x 13.1x 30.3x 14.1x 6.5x 92.0x 14.9x 54.9x 97.9x 6.7x 16.9x 15.3x 7.2x 97.9x 1.2x 21.7x 14.5x
P /TangB V
1.8x 0.5x 0.2x 9.5x 16.9x 3.3x 0.8x 3.1x 8.2x 8.6x 2.7x 0.9x 65.2x 0.3x 1.8x 0.0x 21.7x 19.6x 1.8x 1.3x 18.2x 1.3x 0.0x 6.0x 20.1x 0.5x 0.8x 8.5x 8.2x 18.2x 1.9x 0.9x 5.2x 0.7x 2.5x 1.6x 19.3x 0.9x 2.4x 2.4x 4.0x 56.2x 72.8x 29.6x 0.1x 1.0x 1.3x 4.8x 39.5x 0.0x 8.0x 3.0x 0.9x 72.8x 0.0x 9.6x 2.5x
Figure 20. Valuation Comparison Source. Capital IQ
Page 18
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 38 10 10 8 6 3 2 2 1 1 1 1 1 1 1 1 1 1 89 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 G ermany Hong K ong Ita ly R us s ia S witzerla nd F inland Malays ia India Aus tralia U nited K ingdom Norway G rand Total 49, 633. 4 5, 811. 3 3, 871. 5 2, 974. 2 2, 488. 2 1, 733. 6 1, 527. 4 317. 0 294. 6 165. 4 160. 9 92. 0 65. 9 39. 8 31. 0 22. 1 6. 0 0. 1 69,234.6 Avg US D Market C ap ($m) C hina S weden J apan T aiwan Hong K ong C anada S outh K orea Ita ly R us s ia G ermany U nited S ta tes S witzerla nd F inland Malays ia India Aus tralia U nited K ingdom Norway G rand Total 4,963. 3 2,974. 2 645. 3 577. 9 294. 6 248. 8 190. 9 165. 4 160. 9 158. 5 152. 9 92. 0 65. 9 39. 8 31. 0 11. 0 6. 0 0. 1 777.9 US D L TM Total R ev ($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 4,152. 4 3,887. 3 1,982. 6 1,015. 0 707. 3 634. 4 385. 8 361. 6 242. 6 156. 2 82. 8 77. 1 68. 7 40. 0 17. 8 5. 5 2. 3 0. 0 13,819.5 US D L TM Total E B ITDA ($m) C hina S weden United S tates C a na da J a pa n S outh K orea T a iwa n Ita ly Hong K ong R us s ia G erma ny Ma lays ia Aus tralia S witzerla nd Norwa y United K ingdom F inla nd India G rand Total 2, 070. 2 304. 6 290. 0 200. 0 186. 0 121. 9 59. 8 31. 9 25. 1 20. 4 12. 5 11. 1 4. 5 0. 8 -1. 1 -2. 7 -17. 5 -41. 4 3,276.1 E B ITDA % C hina A us tralia T aiwan J apan S weden Mala ys ia Italy R us s ia S outh K orea Hong K ong S witzerla nd C anada G ermany U nited S ta tes India Norway U nited K ingdom F inland G rand Total 48. 8% 42. 8% 37. 1% 24. 2% 15. 4% 14. 4% 13. 1% 13. 1% 12. 7% 6. 9% 1. 9% -8. 5% -9. 1% -21. 9% -50. 0% -50. 6% NA NA 5.1%
Figure 21. Comparison by Country Source. Capital IQ
C omparable C ompany Analys is > Web 2.0
S ummary by E xc hange
C ompany Name OT C B B Na s daqG S OT C P K K OS E TS E Na s daqG M TS X T S XV S E HK AME X AS X XT R A GTS M SWX HL S E CM BS E NY S E OS E AIM OM RTS K LS E OT C NO G rand Total 18 14 11 6 5 5 4 4 3 2 2 2 2 1 1 1 1 1 1 1 1 1 1 1 89 US D Market C ap ($m) S E HK Nas da qG S TS E OM NY S E K OS E GTS M XT R A OS E Nas da qG M TS X 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 31, 520. 4 24, 385. 7 3, 569. 2 2, 974. 2 1, 750. 4 1, 437. 0 1, 430. 0 317. 0 302. 3 279. 7 243. 6 230. 9 165. 4 160. 9 92. 0 76. 6 68. 5 65. 9 65. 8 39. 8 31. 0 22. 1 6. 0 0. 1 69,234.6 Avg US D Market C ap ($m) S E HK OM NY S E Nas da qG S GTS M TSE OS E K OS E CM R TS XT R A SWX HLS E TSX Nas da qG M K LS E AME X BS E T S XV OT C B B AS X AIM OT C P K OT C NO G rand Total 10,506. 8 2,974. 2 1,750. 4 1,741. 8 715. 0 713. 8 302. 3 239. 5 165. 4 160. 9 158. 5 92. 0 65. 9 60. 9 55. 9 39. 8 34. 2 31. 0 19. 1 12. 8 11. 0 6. 0 6. 0 0. 1 777.9 US D L TM Total R ev ($m) OM S E HK Na s daqG S CM NY S E RTS OS E K OS E TS 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 1,982. 6 540. 0 498. 6 242. 6 198. 5 156. 2 116. 1 106. 0 103. 7 101. 1 82. 8 82. 4 77. 1 46. 4 40. 0 34. 3 27. 9 16. 5 12. 0 8. 9 5. 5 2. 3 2. 3 0. 0 13,819.5 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 OS E RTS Na s daqG M XT R A K LS E 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, 796. 0 767. 5 304. 6 160. 2 124. 1 103. 2 59. 8 31. 9 25. 8 20. 4 15. 6 12. 5 11. 1 6. 2 4. 5 0. 8 -1. 1 -2. 7 -4. 3 -4. 6 -17. 5 -34. 1 -41. 4 -62. 4 3,276.1 E B ITDA % NY S E AS X S E HK GTS M Nas da qG S TSE OS E OM K LS E CM R TS K OS E Nas da qG M T S XV S WX XT R A A ME X TSX OTCB B OTCP K BSE O T C NO A IM HLS E G rand Total 62. 5% 42. 8% 40. 6% 37. 1% 30. 4% 24. 6% 22. 2% 15. 4% 14. 4% 13. 1% 13. 1% 9. 6% 7. 7% 5. 6% 1. 9% -9. 1% -31. 8% -34. 7% -38. 8% -41. 5% -50. 0% -50. 6% NA NA 5.1%
Figure 22. Comparison by Exchange Source. Capital IQ
Page 19
F inanc ing - L as t Three Months (US $ m)
F in. Amount (Million) Month S ep-09 C ompany Name Twitter E ns equence L ivebookings Mzinga InXpo J obvite R iot Games NextB io Imeem Vuclip Y uMe B ooyah NeoE dge Alliance Health Networks Unis fair C onduit L abs Moc apay F wix Vantrix Mas hL ogic G reys tripe L oomia F ourS quare E duF ire F luther Trans G aming Inc. OnL ive S ep-09 Total Oct-09 DailyMotion P opC ap Games E ngine Yard HubS pot J ive S oftware S pigit Ooyala S c anS cout B ox.net R eality Mobile W atercooler Vdopia S ometric s Amie S treet ViVu F izzbac k Technorati Onehub DataS ync DailyB ooth Hot P otato L inkedex S tatus Net IngB oo C hango C redit K arma L is tia Oct-09 Total Nov-09 C ubeTree E ventbrite Altruik C redit K arma B lekko S c oopler Nov-09 Total US A US A US A US A US A US A 0.5 0.5 7.2 8.0 6.0 2.5 4.7 2.5 2.5 US A UK C a na da US A C a na da US A 0.5 0.4 4.5 40.9 56.5 8.0 6. 0 67.4 2.0 US A US A US A 1.0 0.9 0.8 0.7 1.0 1.0 US A US A UK US A US A 1.3 1.2 3.0 2.6 2.0 US A US A US A US A 4.7 4.0 3.9 US A US A US A 6.5 5.5 F rance US A US A US A US A US A 12. 0 10. 0 10. 0 8.5 7. 1 22.5 19. 0 16. 0 C ountry US A 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 ana da US A US A US A US A US A US A C ana da US A 0.6 2.0 16.9 52.3 27.9 25. 3 23.1 110.0 232.8 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. 0 2. 6 2. 0 1. 3 1. 2 1. 0 1. 0 1. 0 0. 9 0. 8 0. 7 0. 5 0. 4 171.3 8. 0 6. 0 4. 7 2. 5 2. 5 0. 5 24.2 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 Type of financing Angel/S eed Debt financing S eries A S eries B S eries C S eries D 20.0 S eries E 100.0 G rand Total 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
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
Altruik B lekko C redit K arma
HQ
United S ta tes United S ta tes United S ta tes
Webs ite
www. altuik. com www. blekko.com www. creditkarma. com
Des cription
Altruik , Inc. provides s earch engine optimization s olutions for optimiz ing the W ebs ite content to ens ure vis ibility and page rank ing. T he company was founded in 2006 and is bas ed in New Y ork, New Y ork. B lek ko, Inc. provides internet s earch s olutions . B lekk o, Inc. was founded in 2007 a nd is bas ed in United S tates . C redit K arma is the cons umer’s advoca te for demys tifying credit and has a ra nge of tools a nd information res ources to help them monitor a nd manage the credit as pect of their financial hea lth. C redit K a rma’s goal is to help cons umers eas ily diges t the contents of their credit report and unders tand what makes up their credit s core. C redit K arma works with a range of partners , including mortgage lenders , credit card providers , bank s , and wireles s providers . C ubeT ree, Inc. provides s ocial networking s oftware. It offers C ubeT ree AP I, a R E S T W eb s ervices AP I, which allows applications to query a nd manipulate the res ources provided by the C ubeT ree W eb application. C ubeT ree provides its s oftware as s ervice. T he compa ny was founded in 2008 and is bas ed in R edwood C ity, C alifornia. Mollyguard C orpora tion, doing bus ines s as E ventbrite, provides online regis tra tion s olutions to event organizers . It offers online event management and ticketing s ervices . T he company a ls o engages in publis hing branded event pages ; promoting events online; and s elling event tick ets through the pers onalized event regis tration W eb page. In addition, it offers an online events marketplace that enables individuals , bus ines s es , and organiza tions of various s izes mana ge, promote, and s ell their events . T he compa ny s erves event organizers , a s well as various non-profits , univers ities , libra ries , and organiz ations . Mollyguard C orporation was founded in 2006 and is ba s ed in S an F rancis co, C alifornia. P hoenix New Media is a s ubs idiary compa ny of P hoenix T elevis ion G roup, an integra ted multi-media platform that offers web, online V OD, a nd mobile internet/ wireles s s ervices . Its web portal, www. ifeng. com, is one of the top news s ites in C hina, es pecially popular among C hina's growing middle clas s . P layfis h Limited, a s ocial games company, develops and publis hes video games for s ocial networks . It creates games for people to play together us ing s ocial networks , s uch as F acebook, MyS pace, B ebo, Y ahoo! , iP hone, and iP od touch. T he company als o offers a dvertis ing opportunities , including in-game video ads and s pons ors hips packages . P layfis h Limited wa s founded in 2007 and is headquartered in L ondon, the United K ingdom with additional offices in B eijing, C hina; S an F rancis co, C alifornia; and T roms o, Norway. As of November 9, 2009, P layfis h Limited operates as a s ubs idia ry of E A Interactive. S coopler, Inc. , a real-time s earch engine, aggregates and organiz es content being s ha red on the internet as it happens . It offers s earch options on entertainment, technology, s ports , world a nd bus ines s , s cience, gaming, politics , and lifes tyle topics . T he company wa s incorporated in 2008 and is ba s ed in S an F rancis co, C a lifornia .
C ubeTree
United S ta tes
www. cubetree. com
E ventbrite
United S ta tes
www. eventbrite. com
P hoenix New Media
C hina
P layF is h
UK
www. playfis h. com
S coopler
United S ta tes
www. s coopler. com
Motley F ool
United S ta tes
www. fool. com
T he Motley F ool, Inc. operates as a multimedia financial-s ervices company. T he compa ny provides financia l s olutions for various inves tors . It reaches people each month through its W ebs ite, books , news paper column, televis ion appea rances , and s ubs cription news letter s ervices . T he company’s s ervices include s ubs cription inves tment news letter that provides information on blue-chips , mutual funds , undis covered s mall caps , and growth s tocks , as well as delivers s tock and fund recommendations ; and F ool.com that publis hes articles to offer news , a nalys is , and commentary through a range of dis tribution partners hips primarily with Y a hoo! , MS N, and AO L. Its s ervices als o compris e C AP S , a Motley F ool community members ’ s tock-rating s ervice; a weekly news paper column; books in print on inves ting and pers onalfinance; independent analys is and engaging commentary for bus ines s reporters , as well as radio a nd T V producers ; F ool UK , a financial W ebs ite in the United S tates ; a nd cons umer finance advices that range from buying a home to dealing with taxes , and from managing creditcard debt to s aving for retirement. Its products and s ervices further include credit cards ; online news letter as an inves tment guide; and reports on s ma res earch, value s tock res earch, million dollar portfolio s ervice, different portfolios , and s tock advis ory. T he company a ls o provides informa tion on bonds , broker comparis on, E T F s , index funds , mutua l funds , and s tock idea s ; and s aving and s pending, credit and debt, home and real es tate, death and T axes , and IR As . T he Motley F ool wa s founded in 1994 a nd is bas ed in Alexandria , V irginia.
Figure 24a. 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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