09-04-28 Web 2.0 Weekly

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The fourth week of April had only a marginal number of capital raises (four) …

The fourth week of April had only a marginal number of capital raises (four)
and not enough to push the month above March and February levels. Total
financings (month-to-date) were $102.3 million, with February and March
closing off at $185.5 mm and $159.5 mm, respectively. As of last week, a
total of 16 deals closed, with the $20 million raise by Collective Media and
$16 million by GOOM Radio being major contributors. Most of the companies in
our universe had positive stock price performances over the past week (for
stocks with prices greater than $1), with 22 companies showing positive
returns on the week. Modern Times Group Mtg AB (MTG B-OM) led the group with
a 27.7% return, while DigitalTown Inc. (DGTW-OTCBB) had the worst return,
dropping 21.7% in the week. Two companies had better than 20% price
increases last week.

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  • 1. SOFTWARE & SERVICES 28 APRIL 2009 DAVID SHORE, CFA, MBA 416.860.6784 WEB 2.O WEEKLY david.shore@researchcapital.com Arun Thomas (Associate) 416.860.7666 WEEK FO UR IN APRIL MOSTLY Q UIET; MEDIA COMPANY BATANGA RAISES $7.5 MILLION PI C K- U P I N ACT I VIT Y ON L Y MA RG IN AL IN W EE K F OU R The fourth week of April had only a marginal number of capital raises (four) and not enough to push the month above March and February levels. Total financings (month-to-date) were $102.3 million, with February and March closing off at $185.5 mm and $159.5 mm, respectively. As of last week, a total of 16 deals closed, with the $20 million raise by Collective Media and $16 million by GOOM Radio being major contributors. W ith four days left in April, it is evident that the month may likely finish at or slightly below March levels, unless a few high dollar financings materialize. W e speculate that capital market activity in April (for W eb 2.0 companies) world- wide has dropped from prior months, potentially as a follow-on (time lagged) effect of the equity markets. W ith a seeming capital market revival on the horizon (as exhibited by stock market index levels) and if sustainable, we should expect institutional investors to participate in venture capital funds or direct investments in private companies – albeit slowly. Financing Activity Last Three Months 200.0 8.0 180.0 7.0 160.0 6.0 140.0 5.0 120.0 (US$m) (US$m) 100.0 4.0 80.0 3.0 60.0 2.0 40.0 1.0 20.0 0.0 0.0 Feb-09 Mar-09 Apr-09 Total Average Capital Market Activity: Four weeks into April and we saw 16 companies raising money, with GOOM Radio and Collective Media still leading the list with $16 million and $20 million, respectively. The largest raise last week was by Batanga – raising $7.5 million. The month-to-date total capital raised stands at $102.3 million. The Rubicon Project (ad network sector) and Cellufun (gaming sector) followed GOOM Radio, raising $13 million and $10 million, respectively. Price Performance: Most of the companies in our universe had positive stock price performances over the past week (for stocks with prices greater than $1), with 22 companies showing positive returns on the week. Modern Times Group Mtg AB (MTG B-OM) led the group with a 27.7% return, while DigitalTown Inc. (DGTW -OTCBB) had the worst return, dropping 21.7% in the week. Two companies had better than 20% price increases last 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. w w w . r e s e a rc h c a p i t a l . c o m T o ro n t o 4 1 6 . 8 6 0 . 7 6 0 0 Montreal 514.399.1500 Vancouver 604.662.1800 Calgary 403.265.7400 Regina 306.566.7550
  • 2. Page 2 THE WEB 2.0 UNIVERSE Ninety-tw o public Web 2.0 companies identified: Our W eb 2.0 universe contains 92 companies, with a combined market cap of ~ $41 billion (Figure 1). The average market cap for the group is ~$452 million (but a median of only $45.8 million), with average trailing revenue of $145.7 million (median $51.8 million). The companies are also generally profitable, with a median EBITDA margin of 17.6%. On a valuation basis, the overall average is 4.7x trailing revenue (median 1.3x) and 9.1x trailing EBITDA (median 7.6x). Thirteen of the companies have more than 500 employees. C omparable C ompany A nalys is > W eb 2.0 Trading Current U S D Market U S D LT M Total US D L TM T otal E B ITDA TE V/LT M T E V/LT M C om pan y Nam e L TM as o f T ic ker E xc h ang e Cu rrenc y H Q Pr ic e C ap ($m) R ev ($m) E B ITDA ($m) % R evenu e E B IT DA E mployees Acce le rize N ew Me dia, Inc. 1 2/31 /200 8 AC LZ OT C B B USD U nited S ta tes 0 .49 1 3.4 3.8 (4 .8) NM 4.7 x - 11 Actoz S of t C o., L td. 1 2/31 /200 8 A0 527 90 K OS E KR W S outh K orea 14, 700 9 3.2 69. 5 1 3.9 20 .0% 0.9 x 4.7x NA AQ Inte ractive , Inc. 1 2/31 /200 8 38 38 TSE JPY J apan 47 ,100 .00 2 6.2 61. 6 4 .9 8 .0% - - NA As s ocia ted Media H oldings Inc. 6 /30 /200 7 AS MH OT C P K USD U nited S ta tes 0 0 .1 0.1 (2 .3) NM 8.1 x - 3 B igstring Corp. 1 2/31 /200 8 BS G C OT C B B USD U nited S ta tes 0 .01 0 .7 0.1 (2 .1) NM 23.6 x - 4 B e tawave Corpora tion 1 2/31 /200 8 BW AV OT C B B USD U nited S ta tes 0 3 .2 7.7 (1 1.8) NM - - 45 B e yond Commerce, Inc. 1 2/31 /200 8 BY OC OT C B B USD U nited S ta tes 1 .49 6 1.6 1.8 (8 .6) NM 35.5 x - 43 B right T hings plc 9 /30 /200 8 AIM:B G T AIM GBP U nited K ingdom 0 5 .0 0.2 (1 .6) NM 20.6 x - 3 ,12 5 B roa dW ebAs ia Inc. 9 /30 /200 8 BW B A OT C P K USD U nited S ta tes 0 .45 3 8.2 0.0 (4 .6) NM - - 37 C DC C orp. 9 /30 /200 8 C HIN .A Nas da qG S USD H ong K ong 1 12 6.3 428 .1 1 8.8 4 .4% 0.4 x 9.7x NA C hina G ate wa y C orpora tion 9 /30 /200 8 CGWY OT C B B USD U nited S ta tes 0 .00 0 .0 6.7 (6 .6) -9 8.9% 6.0 x - NA C hine s e G amer International 1 2/31 /200 8 G T S M:308 3 GT S M TWD T aiwan 215 54 0.7 46. 2 2 3.3 50 .5% 1.1 x 1 3.3 x NA C ornerW orld C orporation 1 /31 /200 9 C WR L OT C B B USD U nited S ta tes 0 .10 6 .4 1.3 NM NM 0.8 x 4.7x 574 C yberplex Inc. 1 2/31 /200 8 T S X:C X TSX C AD C ana da 1 5 3.8 46. 7 3 .9 8 .4% 0.5 x 3.9x NA D ADA S pA 9 /30 /200 8 C M:DA CM EUR Ita ly 5 .85 12 3.7 221 .2 3 5.3 16 .0% - - NA D XN Holdings B hd 1 1/30 /200 8 DXN KL SE MY R Ma la ys ia 0 2 0.2 76. 7 1 0.2 13 .3% 5.6 x - 11 D ibz Inte rnational, Inc. NA DIB Z OT C P K USD U nited S ta tes 0 .00 0 .0 NA NM NM - - 3 D igitalP ost Inte ra ctive , Inc. 9 /30 /200 8 DG LP OT C B B USD U nited S ta tes 0 1 .3 0.4 (3 .3) NM - - 6 D igitalT own, Inc. 1 1/30 /200 8 DG T W OT C B B USD U nited S ta tes 2 .35 6 3.6 NM (2 .5) NM 2.2 x - NA D olphin D igital Me dia, Inc. NA DP DM OT C B B USD U nited S ta tes 1 2 6.1 NA NM NM - - NA E olith C o. L td. 1 2/31 /200 7 A0 410 60 K OS E KR W S outh K orea 760 .00 4 0.7 18. 6 (0 .1) -0 .3% - - 22 E xte ns ions , Inc. 1 2/31 /200 8 E XT I OT C P K USD U nited S ta tes 0 1 4.2 NM NM NM 0.0 x - 29 F inancia l Media G roup, Inc. 1 1/30 /200 8 F NG P OT C B B USD U nited S ta tes 0 .00 0 .3 6.8 1 .2 18 .3% 5.2 x - NA F luid Mus ic Ca nada, Inc. 9 /30 /200 8 T S X:F MN TSX C AD U nited S ta tes 0 1 5.0 4.2 (8 .6) NM 1.1 x 7.8x NA F rogs te r Interactive P icture s AG 6 /30 /200 8 FRG XT R A EUR G ermany 9 .06 2 7.8 5.3 (3 .2) -6 0.6% 0.4 x 1.7x NA G a ma nia Digital E ntertainment C o., L td. 1 2/31 /200 8 61 80 GT S M TWD T aiwan 32 14 4.4 111 .5 1 6.1 14 .5% 6.9 x - 94 G a me On C o L td. 1 2/31 /200 8 38 12 TSE JPY J apan 92 ,000 .00 9 0.9 76. 2 1 9.7 25 .9% - - NA G e oS e ntric O yj 1 2/31 /200 8 G E O1 V H LS E EUR F inland 0 4 6.7 5.7 (1 2.8) NM 1.5 x 6.3x NA G iant Intera ctive G roup, Inc. 1 2/31 /200 8 GA NY S E USD C hina 8 .50 1,9 21.0 233 .6 14 4.6 61 .9% - - 636 G iga Media Ltd. 1 2/31 /200 8 G IG M Nas da qG S USD T aiwan 7 36 4.7 190 .4 4 6.0 24 .2% 40.8 x - NA G ravity C o., L td 9 /30 /200 8 G R VY Nas da qG M USD S outh K orea 0 .90 2 5.0 36. 5 7 .0 19 .2% 1.2 x 6.9x NA G ree, Inc. 6 /30 /200 8 T S E : 363 2 TSE JPY J apan 5, 650 1,2 88.0 30. 0 1 0.8 36 .0% 1.2 x - NA G ungH o O nline E ntertainment, Inc. 1 2/31 /200 8 37 65 OS E JPY J apan 139 ,000 .00 16 2.7 114 .9 2 0.5 17 .8% 0.3 x 7.6x 3 ,20 0 H anbitS of t, Inc. 1 2/31 /200 8 A0 470 80 K OS E KR W S outh K orea 4, 770 7 7.9 51. 8 (1 4.6) -2 8.2% - - NA IAC /InterActiveC orp. 1 2/31 /200 8 IAC I Nas da qG S USD U nited S ta tes 15 .92 2,2 43.9 1 ,44 5.1 6 4.6 4 .5% - - NA IAS E nergy, Inc. 1 /31 /200 9 IAS C.A OT C B B USD C ana da 0 1 7.5 0.0 (0 .8) NM 2.1 x - NA IdeaE dge, Inc. 1 2/31 /200 8 OT C B B :IDAE OT C B B USD U nited S ta tes 0 .44 1 8.8 0.0 (4 .6) NM 0.9 x 2.5x 72 is ee media Inc. 1 2/31 /200 8 IE E T S XV C AD C ana da 0 4 .2 1.2 (4 .8) NM 2.6 x - 237 J umbuck E ntertainment P ty Ltd. 1 2/31 /200 8 AS X:J MB AS X AU D Aus tra lia 0 .47 1 6.4 12. 7 4 .7 37 .2% 1.1 x 1 1.2 x NA J umpT V Inc. 1 2/31 /200 8 T S X:J T V TSX C AD C ana da 1 5 1.0 13. 4 (8 .4) -6 2.6% 3.7 x 9.5x 2 ,27 1 K a boos e Inc. 1 2/31 /200 8 T S X:K AB TSX C AD C ana da 0 .59 6 7.4 66. 8 6 .6 9 .9% 3.1 x - NA K ings oft Co. Ltd. 1 2/31 /200 8 38 88 S E HK HKD C hina 4 51 5.9 120 .2 4 6.3 38 .5% 0.2 x - NA Lingo M edia Corporation 9 /30 /200 8 T S XV : LM T S XV C AD C ana da 0 .90 9 .5 3.3 (1 .4) -4 2.5% - - 90 Live World Inc. 1 2/31 /200 8 LV WD OT C P K USD U nited S ta tes 0 3 .1 11. 8 (0 .5) -4 .3% - - 13 LookS mart, Ltd. 1 2/31 /200 8 LOOK Nas da qG M USD U nited S ta tes 1 .36 2 3.1 65. 0 (2 .0) -3 .1% 5.4 x 1 4.3 x NA Magnitude Information S ys tems Inc. 9 /30 /200 8 MA G Y OT C B B USD U nited S ta tes 0 6 .5 0.1 (3 .2) NM 1.4 x 8.5x 2 ,96 9 Mixi, Inc. 1 2/31 /200 8 21 21 TSE JPY J apan 483 ,000 .00 75 7.4 119 .8 4 5.6 38 .0% - - 3 Mode rn Times G roup Mtg AB 1 2/31 /200 8 MT G B OM S EK S weden 212 1,6 68.7 1 ,57 2.8 25 3.7 16 .1% 3.3 x - NA Moggle , Inc 1 2/31 /200 8 MMOG OT C B B USD U nited S ta tes 2 .30 8 3.5 NM (1 .1) NM 3.0 x 1 1.3 x NA MOK O.mobi L imited 1 2/31 /200 8 MK B AS X AU D Aus tra lia 0 4 .4 1.0 (2 .1) NM 1.9 x 4.2x 2 ,42 6 N E OW IZ G ames C orpora tion 1 2/31 /200 7 A0 956 60 K OS E KR W S outh K orea 58 ,400 .00 41 8.5 134 .3 3 6.1 26 .9% - - NA N etD ragon W ebS oft, Inc. 1 2/31 /200 8 77 7 S E HK HKD C hina 5 31 3.1 87. 3 3 9.9 45 .7% - - 19 N ete as e.com I nc. 1 2/31 /200 8 NT E S Nas da qG S USD C hina 30 .25 3,7 22.3 451 .8 29 3.7 65 .0% - - NA N eXplore Corpora tion 9 /30 /200 7 NXP C OT C P K USD U nited S ta tes 1 4 1.8 NM (4 .9) NM 0.2 x 1.3x 286 N gi G roup Inc. 1 2/31 /200 8 24 97 TSE JPY J apan 36 ,300 .00 4 5.8 100 .4 3 0.9 30 .8% 2.4 x 9.6x 3 ,40 0 N orthgate Te chnologies L imited 1 2/31 /200 8 59 005 7 BS E INR India 46 3 1.9 135 .1 2 3.8 17 .6% 0.1 x - 627 Open T e xt Corp. 1 2/31 /200 8 OT E X Nas da qG S USD C ana da 33 .54 1,7 40.7 769 .3 19 5.0 25 .3% - - NA Openwave S ys tems Inc. 1 2/31 /200 8 OP W V Nas da qG S USD U nited S ta tes 1 9 9.1 199 .6 (1 0.2) -5 .1% 2.6 x - NA P e rf ect W orld C o., Ltd. 1 2/31 /200 8 PW R D Nas da qG S USD C hina 16 .78 88 5.3 210 .5 11 3.9 54 .1% - - 74 P hotoChannel N etwork s Inc. 1 2/31 /200 8 T S XV : P N T S XV C AD C ana da 2 4 3.3 16. 2 (0 .8) -4 .9% 0.0 x 0.2x NA Quepa s a C orp. 1 2/31 /200 8 QP S A Nas da qC M USD U nited S ta tes 0 .87 1 1.1 0.1 (1 1.4) NM 0.1 x 0.3x NA OA O R B C Information S ys tems 1 2/31 /200 7 R BC I R TS USD R us s ia 1 10 5.7 141 .0 1 8.4 13 .1% 0.8 x 5.9x 514 S handa Interactive E ntertainme nt L td. 1 2/31 /200 8 S N DA Nas da qG S USD C hina 47 .30 3,2 81.8 522 .7 24 0.2 46 .0% 2.0 x 2 1.1 x NA S hutte rf ly, Inc. 1 2/31 /200 8 S F LY Nas da qG S USD U nited S ta tes 10 25 5.1 213 .5 2 8.4 13 .3% 1.8 x 5.8x 11 S K C ommunications Co., Ltd. 1 2/31 /200 7 A0 662 70 K OS E KR W S outh K orea 10 ,000 .00 30 6.4 154 .5 1 4.5 9 .4% 1.1 x - 33 S N AP Inte ra ctive , Inc. 1 2/31 /200 8 ST VI OT C B B USD U nited S ta tes 1 7 .0 3.0 0 .9 31 .4% 0.0 x - NA S N M G lobal H oldings 9 /30 /200 8 S N MN OT C P K USD U nited S ta tes 0 .01 0 .0 2.0 (0 .7) -3 4.8% 3.8 x 9.0x 3 ,19 7 S ocia l Media Ve nures , Inc. 1 2/31 /200 8 S M VI OT C P K USD U nited S ta tes 0 0 .0 0.1 (0 .1) -6 0.5% - - 15 S ohu. com Inc. 1 2/31 /200 8 S OH U Nas da qG S USD C hina 50 .53 1,9 26.0 429 .1 18 0.5 42 .1% 0.8 x 3.8x 183 S ite s earch C orporation 1 /31 /200 9 STPC OT C B B USD U nited S ta tes 3 2 8.2 NM (1 .1) NM - - 7 S park Networks , Inc. 1 2/31 /200 8 LOV AME X USD U nited S ta tes 2 .25 4 6.3 57. 3 1 2.3 21 .5% 15.9 x 3 2.5 x 6 ,19 4 S pectrumDNA, Inc. 1 2/31 /200 8 S P XA OT C B B USD U nited S ta tes 0 9 .7 0.1 (2 .5) NM 0.2 x - 347 T encent Holdings L td. 1 2/31 /200 8 70 0 S E HK HKD C hina 65 .95 15,3 25. 4 1 ,04 7.9 51 2.5 48 .9% - - NA T he Parent C ompany 8/2/2008 K IDS .Q OT C P K USD U nited S ta tes 0 0 .3 112 .0 (1 3.5) -1 2.0% - - 310 T he 9 L imited 1 2/31 /200 8 NCT Y Nas da qG S USD C hina 9 .21 24 7.0 250 .2 8 4.3 33 .7% 4.6 x - 16 T he S treet.com, Inc. 1 2/31 /200 8 TSC M Nas da qG M USD U nited S ta tes 2 7 1.9 71. 9 7 .0 9 .7% 0.3 x - 700 T otal S port Online A S 3 /31 /200 6 T OS O OT C NO NOK N orwa y 0 .03 0 .1 2.0 (1 .0) -5 0.6% 0.1 x 2 9.5 x NA T ree.C om, Inc. 1 2/31 /200 8 TR EE Nas da qG M USD U nited S ta tes 6 5 8.3 228 .6 (2 3.9) -1 0.4% 1.0 x 4.5x 1 ,46 9 U nis erve C ommunications Corp. 1 1/30 /200 8 T S XV : US S T S XV C AD C ana da 0 .04 0 .8 24. 4 0 .1 0 .4% 8.6 x - NA U nited Online Inc. 1 2/31 /200 8 U NT D Nas da qG S USD U nited S ta tes 5 39 0.2 669 .4 15 3.9 23 .0% 1.1 x 6.3x 1 ,18 9 U OMO Media , Inc 1 /31 /200 9 U OMO OT C B B USD C ana da 0 .06 5 .1 0.6 (0 .5) -7 8.2% - - 4 V a lueC lick Inc. 1 2/31 /200 8 VC LK Nas da qG S USD U nited S ta tes 10 84 0.6 625 .8 11 3.6 18 .2% - - NA V O IS , Inc. 1 2/31 /200 8 VOIS OT C B B USD U nited S ta tes 0 .30 2 .5 0.0 (1 .3) NM 4.3 x - 110 W ebze n Inc. 1 2/31 /200 8 W ZE N Nas da qG M USD S outh K orea 3 3 3.0 21. 2 (4 .2) -1 9.8% - - NA W izza rd S of twa re Corpora tion 1 2/31 /200 8 W ZE AME X USD U nited S ta tes 0 .55 2 5.9 6.1 (6 .0) -9 8.2% - - 1 W oozyF ly, Inc. 1 2/31 /200 8 W ZY F OT C B B USD U nited S ta tes 0 2 .6 NM NM NM - - NA W orlds .com Inc. 9 /30 /200 8 W DD D OT C B B USD U nited S ta tes 0 .17 8 .9 0.1 NM NM 3.1 x 9.8x 174 W ynds torm C orporation NA W YND OT C B B USD U nited S ta tes 0 1 .6 NA NM NM 2.2 x 9.8x NA XIN G AG 1 2/31 /200 8 O1B C XT R A EUR G ermany 29 .77 19 9.0 45. 6 1 4.6 32 .0% 0.6 x - NA Y e dangOnline Corp. 1 2/31 /200 7 A0 527 70 K OS E KR W S outh K orea 9, 670 11 2.7 51. 1 1 1.4 22 .4% 0.6 x - NA Y nk K orea Inc. 1 2/31 /200 7 A0 237 70 K OS E KR W S outh K orea 4 ,700 .00 8 .6 14. 5 (1 .1) -7 .6% - - - ZipLocal Inc. 1 2/31 /200 8 T S XV : ZIP T S XV C AD C ana da 0 0 .3 2.6 (2 .8) NM 40.8 x 3 2.5 x 2 0,16 4 H igh 15,3 25. 4 1 ,572 .8 51 2.5 65 .0% 40.8 x 3 2.5 x 20 ,16 4 Low 0 .0 0.0 -23.9 -9 8.9% - - 0 A vera ge 451.8 145.7 32.0 6.9% 4.7x 9.1x 1,122 Median 4 5.8 51. 8 1 .2 17 .6% 1.3 x 7.6x 183 Figure 1. Web 2.0 Universe Summary Source. Capital IQ
  • 3. Page 3 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 ) Marginal activity - April financing will likely be below March: Last week closed with 16 financings (month-to-date April) totalling $102.3 million. The month of April (so far) has registered four deals greater than or equal to $10 million and two deals greater than $15 million. The month of March registered 22 financings (total $130.7 million, average $5.9 million) compared to 25 financings announced in February, totalling $185.5 million, or $7.4 million on average (Figure 2). The average value for February was above the $6.8 million average for January, with four financings over $15 million in February (Twitter, Synthasite, Tremor Media, and Offerpal Media) vs. no deals over $15 million in January. Financing Activity Last Three Months 200.0 8.0 180.0 7.0 160.0 6.0 140.0 5.0 120.0 (US$m) (US$m) 100.0 4.0 80.0 3.0 60.0 2.0 40.0 1.0 20.0 0.0 0.0 Feb-09 Mar-09 Apr-09 Total Average Figure 2. Financings, Last Three Months Source. Company reports Collective Media largest deal in April: Four weeks into April and Collective Media tops the list with a $20 million raise, followed by Goom Radio and The Rubicon Project with $16 million and $13 million, respectively (Figure 3). For additional details, see Figures 23 and 24 (at end of note).
  • 4. (US$m) 0.0 5.0 10.0 15.0 20.0 25.0 30.0 35.0 40.0 Twitter Kaixin001.com Collective Media Source. Company reports Synthasite Tremor Media GOOM Radio Vidyo Offerpal Media Imagini The Rubicon Project Buzznet Emergent Game Figure 3. Capital Market Activity, Last Three Months Outbrain LendingClub SendMe Inc. companies raising $63.4 million. Miva Auditude Cellufun Glam Media Visible Measures SuperSecret Tvtrip GoViral ScanScout Batanga Tongxue Oodle Greystripe Wamba DoubleTwist OMGPOP Socialtext TextDigger OneSpot Mixercast Apture Simulmedia Mixpo FetchDog Virtual Fairground Tynt SoundCloud AnySource Media Pixazza 7 Billion People TubeMogul Financing Summary - Last Three Months FamilyLink.com Tribal Nova WhistleBox Tripbase Hunch Bit.ly Sports Composite DE Mendeley Outright Tvinci Filtrbox Socialcast Scan & Target MMO Life AdultSpace Cake Financial Myngle 33Across fav.or.it Three Melons Foodista Apr-09 Mar-09 Feb-09 Page 4 sector, with 12 companies raising over $74.4 million (Figure 4). The video sector has the next highest totals, with eight Social Networks is the most active sector: Activity over the last three months was busiest in the Social Networks
  • 5. Page 5 Capital Market Activity by Sector - Last Three Months 80.0 70.0 60.0 50.0 (US$m) 40.0 74.4 63.4 30.0 57.4 20.0 41.9 41.4 37.0 22.5 20.6 10.0 16.0 15.0 12.0 12.0 11.0 6.5 5.5 4.3 4.1 4.1 3.9 3.1 2.0 2.0 0.0 1.4 1.3 1.3 Comment/Reputation Gaming Visual Commerce Wiki Travel Media Microblog Mobile Publishing Online Learning Financial Services Mobile Ad Widget Lending Search Infrastructure Social Networks Virtual Goods SAS Video Aggregation Virtual World Crowdsourced Ad Network Analytics Content # companies 12 8 9 5 7 2 4 2 3 1 1 1 2 2 1 1 1 1 1 1 1 1 1 1 1 Figure 4. Capital Market Activity, by Sector, Last Three Months Source. Company reports 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 outperforms: Our W eb 2.0 index (market-cap weighted) essentially mirrored the performance of the NASDAQ composite index from mid-2008 until recently when it has moved higher than the NASDAQ index (Figure 5).
  • 6. Page 6 Web 2.0 Index Price Performance 120 100 80 60 40 20 0 4/28/2008 5/12/2008 5/26/2008 6/9/2008 6/23/2008 7/7/2008 7/21/2008 8/4/2008 8/18/2008 9/1/2008 9/15/2008 9/29/2008 10/13/2008 10/27/2008 11/10/2008 11/24/2008 12/8/2008 12/22/2008 1/5/2009 1/19/2009 2/2/2009 2/16/2009 3/2/2009 3/16/2009 3/30/2009 4/13/2009 4/27/2009 ^COMP - Share Pricing Index: Web 2.0 X (Market Cap) Figure 5. Web 2.0 Price Performance Source. Capital IQ A positive week: Most of the companies in our universe had positive stock price performances over the past week (for stocks with prices greater than $1) (Figure 6), with 22 companies showing positive returns on the week. Modern Times Group Mtg AB (MTG B-OM) led the group with a 27.7% return while DigitalTown Inc. (DGTW -OTCBB) had the worst return, dropping 21.7% in the week.
  • 7. Page 7 1 Week P rice P erformance Modern Times G roup Mtg A B 27.7% Eolith Co. Ltd. 21.6% LookS mart, Ltd. 19.9% DA DA S pA 17.3% Chines e Gamer International 14.7% HanbitS of t, Inc. 14.7% GungHo Online Entertainment, Inc. 13.7% Giant Interactive G roup, Inc. 11.8% XING A G 10.3% S ohu.com Inc. 8.8% Frogs ter Interactiv e Pictures A G 8.5% S handa Interactive Entertainment Ltd. 6.4% Webz en Inc. 5.7% Perfect World Co., Ltd. 5.3% Neteas e.com Inc. 4.6% V alueClick Inc. 4.4% TheS treet.com, Inc. 4.0% G ree, Inc. 3.7% Tree.Com, Inc. 2.8% Cy berplex Inc. 2.5% Gamania Digital Entertainment Co., 0.8% A Q Interactiv e, Inc. 0.2% A ctoz S of t Co., Ltd. 0.0% United Online Inc. -0.2% G ameOn Co Ltd. -0.2% B ey ond Commerce, Inc. -0.7% G igaMedia Ltd. -1.0% Openw ave S y s tems Inc. -1.7% IA C/InterA ctiveCorp. -1.7% S hutterf ly , Inc. -3.5% The9 Limited -4.0% S park Netw orks , Inc. -4.3% Open Tex t Corp. -4.5% PhotoChannel Netw orks Inc. -5.5% CDC Corp. -15.7% DigitalTow n, Inc. -21.7% -30.0% -20.0% -10.0% 0.0% 10.0% 20.0% 30.0% 40.0% Figure 6. 1-Week Price Performance Source. Capital IQ
  • 8. Page 8 INDUSTRY NEWS (PARTNERSHIPS, FINANCIAL RESULTS, NEW PRODUCTS) K ey Developments C ompany Headline Notes S hutterfly, Inc . (Nas daqG S : S FL Y) S hutterfly E xpands B eyond P hotos with New C oordina ted S hutterfly Inc. a nnounced the expa ns ion of its s ta tionery collection to include a n a rra y of new products a nd hundreds of exclus ive des igns by S uites of Des igner S ta tionery s ome of the indus try's mos t celebra ted des igners . B uilding on S hutterfly's pos ition in ca rds , the new pers ona l s ta tionery line grows the C ompa ny's des igns to ca ter to a variety of life's celebra tions . S hutterfly's s uite of s tationery now offers new items s uch a s pers ona lized pa rty invita tions . S hutterfly's S ta tionery C ollection Includes , E xpa nded occa s ions for 5x7 s tationery ca rds . F rom moving a nnouncements to birthda y invitations for a ll a ges a nd s ocia l corres pondence cards , S hutterfly's premium non-photo offering comes on hea vy-weight ca rds tock with envelopes . Ma de from 30% pos t-cons umer wa s te, 5x7 s ta tionery cards a re s old in s ets , from $1. 39 per ca rd. New, s ma ller 4. 25x5. 5 s ta tionery ca rds . Ma ny of the new des igns ha ve coordina ted 4. 25x5. 5 tha nk you ca rds for a nnouncements a nd invita tions . T he s maller ca rd provides a n elega nt wa y to s end a ha nd-written thank you or a note to s a y a s imple hello. C a rds a re s old in s ets with envelopes , from $0. 89 per ca rd. Des igner a ddres s la bels . T he new s tylis h, coordina ted a ddres s la bels a llow cus tomers to a dd a s ma ll, but noticeable, pers ona l touch VOIS , Inc . (OTC B B :VOIS ) V O IS Inc. L a unches New S ocia l S ourcing W ebs ite V OIS Inc. la unched a new s ocia l s ourcing webs ite a imed a t s licing through the ma la is e and red ta pe of the tra ditiona l recruitment a nd employment model. V ois . com a ims to be the firs t s ocia l commerce s ite tha t levera ges the power of s ocia l networking to help a global audience find a nd offer immedia te work. W ith V OIS , members can pos t work, find work a nd network--a ll without ironing s lacks or vis iting K inkos . F rom the profes s ional's pers pective, get to build ra pport with peers , form virtual cros s -functiona l tea ms , a nd then bid on a nd ta ckle both temporary a nd perma nent projects . B uyers a nd s ellers a re encouraged to get to know more tha n each other's online ha ndles a nd hourly ra tes through cha t rooms , interna l mes s aging, robus t profiles a nd even a trus ty rating s ys tem. W hile s ta nda rd freela nce ma rketpla ces typica lly ta ke between 8-20% of the provider's payment by notorious ly nickel a nd diming us ers with fees and fine print, V OIS is a dhering to a 'F reemium' model. T his model offers a free vers ion of its webs ite to a ny member but is s upported by pa id credits of its mos t frequent us ers . DigitalFX International, Inc . DigitalF X Interna tional Inc. Appoints R icha rd B urnett to Digita lF X Interna tiona l Inc. a nnounced tha t it ha s enga ged lea ding direct s elling indus try expert R icha rd B urnett, a s a s pecia l a dvis or to (OTC B B : DGF X) L ea d S a les and Ma rketing ma na gement to front its s a les and ma rketing efforts within its independent dis tributor network. B urnett's enga gement is a critica l pa rt of the compa ny's continued efforts to ens ure s us ta ina bility a nd reliability, a nd to s et the s ta ge for future growth. His res pons ibilities will include as s es s ing a nd improving a ll a s pects of the company's a ffiliate network, a nd he will a ls o s upport the ma na gement team in its efforts to further develop the C ompa ny's ma rket pos ition. R icha rd B urnett is F ounder & C E O of T op G un Network Inc. a nd ha s a 30 year tra ck record of helping individua ls a nd compa nies dra ma tica lly increa s e s a les a nd improve lea ders hip performa nce. C DC C orp. (Nas daqGS : C HIN.A); C DC C DC R eviews Alterna tives F or T hree B us ines s es C DC C orp. a nnounced tha t it pla ns to explore s trategic growth a lterna tives for its three core bus ines s tha t ha ve together increa s ed 2008 Games L imited; C DC G lobal S ervic es , aggrega te Adjus ted E B IT DA (a ) from continuing opera tions (b) by 34% compa red to 2007. T he three core bus ines s es a re C DC S oftwa re Inc .; C DC S oftware C orporation C orporation, C DC G loba l S ervices a nd C DC G a mes L imited. P eter Y ip, C E O of C DC C orp s aid, “Des pite the globa l economic downturn, three of our core bus ines s es a chieved a n impres s ive 34 percent increa s e, on a n a ggrega te ba s is , in Adjus ted E B IT DA from continuing opera tions in 2008 compa red to the prior yea r. C DC C orpora tion has inves ted cons idera ble time a nd effort to develop thes e va rious core bus ines s es a nd ea ch of them is a t a different s ta ge of ma turity. During 2008, C DC C orporation ha s improved s evera l of the key opera ting metrics in thes e bus ines s es a nd is now in the proces s of exploring s tra tegic a nd growth a lterna tives with res pect to a ll of them. W e believe tha t the exploration of s uch alterna tives for thes e bus ines s es could ultima tely unlock s ha reholder va lue in the compa ny, a s we feel our s ha res are currently underva lued in the ma rket. ” C DC C orp. (Nas daqGS : C HIN.A) C DC C orp. R eports Una udited E a rnings R es ults for the C DC C orp. reported una udited ea rnings res ults for the fourth qua rter a nd yea r ended December 31, 2008. F or the qua rter, the compa ny F ourth Qua rter a nd Y ea r E nded December 31, 2008 reported opera ting los s from continuing opera tions of $57, 881, 000, los s before income ta xes of $87, 836, 000 a nd los s from continuing opera tions of $84, 287, 000 or $0. 79 ba s ic a nd diluted per s ha re and net los s of $84, 015, 000 or $0. 78 bas ic a nd diluted per s ha re on tota l revenues of $96, 236, 000 a ga ins t opera ting los s from continuing opera tions of $8, 986, 000, los s before income ta xes of $24, 920, 000 a nd los s from continuing opera tions of $26, 188, 000 or $0. 24 ba s ic a nd diluted per s ha re a nd net los s of $93, 999, 000 or $0. 88 ba s ic a nd diluted per s ha re on tota l revenues of $106, 926, 000 for the s ame period a yea r ago. T he company a ls o reported net ca s h provided by opera ting activities $27, 106, 000. Adjus ted E B IT DA from continuing opera tions wa s $8. 0 million compa red to a djus ted E B IT DA of los s of $4. 5 million, res pectively, for the fourth qua rter of 2007. F or the yea r, the compa ny reported opera ting los s from continuing opera tions of $71, 424, 000, los s before income ta xes of $108, 079, 000 a nd los s from continuing opera tions of $108, 445, 000 or $1. 01 ba s ic a nd diluted per s ha re a nd net los s of $116, 300, 000 or $1. 08 ba s ic a nd diluted In the fourth quarter of 2008, the compa ny recorded a goodwill a nd intangible a s s et impa irment charge of $49. 0 million and a n impa irment cha L ookS mart, L td. (Nas daqG M:L OOK ) L ookS mart Announces Limited B eta T es t of LookS ma rt Ltd. a nnounced the limited beta tes t of S ma rtR ota tion, a cos t-per-a cquis ition (C P A) driven tool tha t us es a tra cking pixel to S ma rtR ota tion, a C os t-per-a cquis ition Driven T ool automa tica lly optimize ca mpa igns ba s ed on the bes t-converting a d crea tive. S ma rtR ota tion is pa rt of a la rger beta tes t of a d rota tion a nd is the lates t a ddition to LookS ma rt's AdC enter, a powerful a d s erving a nd keyword a uction pla tform tha t ena bles advertis ers to ma na ge return on inves tment (R OI) through increas ed ta rgeting a nd tra cking. L ookS ma rt's AdC enter proces s es more tha n a billion da ily queries for LookS ma rt's s yndica ted network a nd is us ed by thous a nds of a dvertis ers via s elf-s ervice accounts , dedica ted ma na ged s ervices a nd bid ma na gement through a dva nced AP I technology. T he AdC enter's ta rgeting a nd tra cking fea tures include geo-ta rgeting, a d s cheduling, a nd convers ion tra cking a nd reporting a nd tra ffic ma na gement fea tures like referrer white-a nd bla ck-lis ting a nd ca mpaign-level feed ca pping. S ma rtR ota tion is ava ila ble in limited beta tes ting to qualified cus tomers . Quepas a C orp. (Nas daqC M: QP S A) Q uepa s a . com a nd W orldV ibe E nterta inment Announce Quepa s a C orp. , owner of Quepa s a . com, a nnounced a n exclus ive pa rtners hip with W orldV ibe E nterta inment G roup, L L C . Under the E xclus ive P a rtners hip pa rtners hip Q uepas a . com will be the exclus ive online pa rtner for E s MiP la neta . com, the fa n s ite for 'B a ta lla de la s Americas , ' a mus ic-ba s ed rea lity s how tha t s pa ns more tha n twenty countries throughout the America s , including the U. S . T he firs t 2009 s eas on is a ta lent s ea rch for the ba nd 'X M2, ' in which three former members of the L atin s uper-group Menudo(T M), s ea rch for their final member. T he fully-interactive, vibra nt online community, which will be powered by Q uepa s a . com in three la ngua ges : E nglis h, S pa nis h, a nd P ortugues e, will fea ture online voting in which fa ns determine which contes ta nts move on a nd who goes home. P lus the genera l public will be invited to join the competition by s ubmitting a video a udition online a nd enter the contes t via the web. T he multimedia community will als o include exclus ive online performa nce highlights , behind the s cenes foota ge, contes ta nt profiles a nd photos , us er-genera ted content, and the a bility to uploa d photogra phs a nd videos . NetDragon W ebS oft, Inc . (S E HK : 777) NetDra gon W ebS oft, Inc. 's E quity B uyba ck has expired NetDra gon W ebS oft, Inc. (S E HK : 777) wa s granted s ha reholders a pprova l in the Annua l G eneral Meeting held on J une 12, 2008. Under the program the compa ny intends to repurcha s e up to 10% of the is s ued s ha re ca pita l. T he s ha re capita l would be repurcha s ed in the s tock excha nge. T he s ha re a uthority will expire ea rlies t of the conclus ion of the next Annua l G enera l Meeting or by the revoca tion or va riation of this res olution by a n ordina ry res olution of the s ha reholders of the C ompa ny in genera l meeting. As of S eptember 30, 2008, the C ompa ny ha s repurcha s ed 9, 370, 500 s ha res for a HK D 46. 90 million (C NY 41. 38 million). T he convers ion wa s ma de through www. oa nda . com on S eptember 30, 2008. NetDra gon W ebS oft, Inc’s s hare repurcha s e program expired on April 21, 2009. NetDragon W ebS oft, Inc . (S E HK : 777) NetDra gon W ebS oft, Inc. a nnounces a n E quity B uyback NetDra gon W ebS oft, Inc. (S E HK : 777) wa s granted s ha reholders a pprova l to repurcha s e s hares in the Annua l G eneral Meeting held on April 21, 2009. Under the progra m, the compa ny intends to repurcha s e up to 52, 857, 086 s ha res repres enting 10% of the is s ued s ha re capita l of the compa ny. T he Directors believe tha t it is in the interes ts of the C ompa ny a nd the S ha reholders to ha ve a genera l a uthority from the S hareholders to ena ble the Directors to repurcha s e S ha res on G E M. S uch repurcha s es ma y, depending on ma rket conditions a nd funding arra ngements a t the time, lead to a n enha ncement of the net a s s ets of the C ompa ny a nd/or its ea rnings per S hare a nd will only be ma de when the Directors believe tha t s uch purcha s es will benefit the C ompa ny a nd the S ha reholders . T he program is valid until the ea rlies t of the conclus ion of the next a nnua l genera l meeting of the C ompa ny or the expira tion of the period within which the next a nnua l general meeting of the C ompa ny is required by the Articles , or a ny applicable la w of the C a yma n Is la nds to be held or the R epurchas e Ma nda te being revoked or va ried by a n ordina ry res olution of the S ha reholders in genera l meeting prior to the next a nnua l genera l meeting. B eyond C ommerce, Inc. B eyond C ommerce Inc. R eports R evenue R es ults for the B eyond C ommerce Inc. revenue res ults for the month of F ebrua ry 2009. T he compa ny reported $3. 3 million in revenues for the month of (OTC B B : B YOC ) Month of F ebrua ry 2009 ; P rovides R evenue G uida nce F ebrua ry 2009, $2. 3 million for the month of J a nua ry 2009 a nd $1. 07 million for the month of December 2008. for the Months of April a nd Ma y 2009 T he company is on tra ck for continued s trong growth in revenue in the months of April a nd Ma y 2009. S ites earc h C orporation (OTC B B : S TP C ) S ites ea rch C orpora tion Announces E xecutive C ha nges On April 20, 2009, J a mes S . Dixon res igned a s C hief E xecutive Officer, P res ident, S ecreta ry a nd T rea s urer of S ites ea rch C orpora tion. As a co-founder a nd inves tor in S ites ea rch C orpora tion, Mr. Dixon will rema in a Director of the C ompany. T he B oa rd of Directors a ppointed J effrey S . P eters on, to s erve a s the C hief E xecutive O fficer, S ecreta ry a nd T rea s urer. Mr. P eters on will s erve in thes e pos itions a nd a ls o continue to s erve a s the cha irma n of the B oa rd. T he company a ls o announced the res igna tion of B a mbi F ra ncis co a s a Director at her reques t. Ms . F ra ncis co ha s s erved a s a n outs ide Director for the C ompa ny s ince April, 2008.
  • 9. Page 9 E lectronic Arts Inc . (Nas daqG S : E R TS ); T he9 Limited - S pecia l/M&A C all T o dis cus s the highly anticipa ted game E A S P O R T S (T M) F IF A O NLINE 2 will begin its open beta tes t in mainla nd C hina The9 L imited (Nas daqGS : NC TY) K ings oft C o. L td. (S E HK : 3888) K ings oft C o. Ltd Mulls a n E quity B uyback K ings oft C o. L td will s eek s ha reholder a pproval to repurchas e own s hares at the Annua l G eneral Meeting to be held on Ma y 25, 2009. Under the propos ed buyback, the compa ny intends to repurcha s e up to 107,720, 033 s hares . R epurcha s es s ha ll be made on the s tock excha nge. MOK O.mobi L imited (AS X: MK B ) MOK O .mobi S igns Dea l with B oos t Mobile MOK O. mobi L imited has s igned a n a greement with B oos t Mobile Aus tra lia that includes a revenue s ha re on daily and monthly s ubs cription cha rges , MMS , priva te media mes s aging and advertis ing. MOK O. mobi is now a vaila ble a cros s a ll mobile networks in Aus tra lia. NetDragon WebS oft, Inc. (S E HK : 777) NetDragon La unches Open B eta T es ting for T he NetDragon W ebS oft, Inc. announced tha t T he W arlords , the E nglis h vers ion of T ou Ming Zhua ng O nline, entered its open beta tes ting on W a rlords in North America April 24. T he W arlords is a 2. 5 D MMO R P G ga me jointly crea ted by NetDragon a nd C hina F ilm G roup, s haring the s ame s tory as the film titled T he W arlords . It exhibits traditiona l C hines e ma rtial arts through complica ted s tories s et in the la te Qing Dyna s ty. B eyond C ommerc e, Inc. B eyond C ommerce, Inc. Announces the L aunch of B eyond C ommerce, Inc. announced the official launch of LocalAdL ink. com, a low cos t provider of online a dvertis ing for loca l bus ines s es (OTC B B : B YOC ) Loca lAdlink a cros s the nation. L ocalAdLink is a provider of s ervices that ena ble local bus ines s es to reach loca l cus tomers with targeted Internet a dvertis ing. T he cus tomer fa cing W eb s ite, L oca lAdLink. com, is a loca l s earch directory and acts as the central hub for the L oca lAdL ink technology. W hen a cus tomer vis its L ocalAdLink. com, proprietary geo-ta rgeting s oftwa re identifies the cus tomer's loca tion a nd dis plays relevant loca l bus ines s lis tings . In a ddition, L oca lAdLink has created an Advertis ing Network tha t publis hes loca l bus ines s lis tings on its owned a nd operated s ites , as well as partner s ites . Figure 7. Key Developments Source. Capital IQ
  • 10. Page 10 VALUATION MMOG companies lead market-cap charts: Nine companies in our Web 2.0 universe top US$1 billion in market capitalization (Figure 8). Sixty-four of the 92 companies have market caps under US$100 million, with 28 under $10 million. Online gaming companies dominate the top of the list. Market C ap (US D m) Tenc ent Holdings Ltd. Neteas e.c om Inc . 3722.3 S handa Interac tive Entertainment Ltd. 3281.8 IA C/InterA c tiveCorp. 2243.9 S ohu.c om Inc . 1926.0 Giant Interac tive G roup, Inc . 1921.0 Open Tex t Corp. 1740.7 Modern Times G roup Mtg A B 1668.7 G ree, Inc . 1288.0 Perfec t World Co., Ltd. 885.3 V alueClic k Inc . 840.6 Mix i, Inc . 757.4 Chines e G amer International 540.7 K ings oft Co. Ltd. 515.9 NEOWIZ G ames Corporation 418.5 United Online Inc . 390.2 G igaMedia Ltd. 364.7 NetDragon WebS oft, Inc . 313.1 S K Communic ations Co., Ltd. 306.4 S hutterfly , Inc . 255.1 The9 Limited 247.0 X ING A G 199.0 G ungHo Online Entertainment, Inc . 162.7 Gamania Digital Entertainment Co., Ltd. 144.4 CDC Corp. 126.3 DA DA S pA 123.7 Y edangOnline Corp. 112.7 OA O R B C Information S y s tems 105.7 Openw ave S y s tems Inc . 99.1 A c toz S oft Co., Ltd. 93.2 GameOn Co Ltd. 90.9 Moggle, Inc 83.5 HanbitS oft, Inc . 77.9 TheS treet.c om, Inc . 71.9 K aboos e Inc . 67.4 DigitalTow n, Inc . 63.6 B ey ond Commerc e, Inc . 61.6 Tree.Com, Inc . 58.3 Cy berplex Inc . 53.8 J umpTV Inc . 51.0 GeoS entric Oy j 46.7 S park Netw orks , Inc . 46.3 Ngi G roup Inc . 45.8 PhotoChannel Netw orks Inc . 43.3 NeXplore Corporation 41.8 Eolith Co. Ltd. 40.7 B roadWebA s ia Inc . 38.2 Webz en Inc . 33.0 Northgate Tec hnologies Limited 31.9 S ites earc h Corporation 28.2 Frogs ter Interac tive Pic tures A G 27.8 A Q Interac tive, Inc . 26.2 Dolphin Digital Media, Inc . 26.1 Wiz z ard S of tw are Corporation 25.9 G ravity Co., Ltd 25.0 LookS mart, Ltd. 23.1 DX N Holdings B hd 20.2 IdeaEdge, Inc . 18.8 IA S Energy , Inc . 17.5 J umbuc k Entertainment Pty Ltd. 16.4 Fluid Mus ic Canada, Inc . 15.0 Extens ions , Inc . 14.2 A c c eleriz e New Media, Inc . 13.4 Quepas a Corp. 11.1 S pec trumDNA , Inc . 9.7 Lingo Media Corporation 9.5 W orlds .c om Inc . 8.9 Y nk K orea Inc . 8.6 S NA P Interac tive, Inc . 7.0 Magnitude Information S y s tems Inc . 6.5 CornerWorld Corporation 6.4 UOMO Media, Inc 5.1 B right Things plc 5.0 MOK O.mobi Limited 4.4 is eemedia Inc . 4.2 B etaw ave Corporation 3.2 LiveWorld Inc . 3.1 Wooz y Fly , Inc . 2.6 V OIS , Inc . 2.5 W ynds torm Corporation 1.6 DigitalPos t Interac tive, Inc . 1.3 Unis erve Communic ations Corp. 0.8 B igs tring Corp. 0.7 Z ipLoc al Inc . 0.3 Financ ial Media G roup, Inc . 0.3 The Parent Company 0.3 Total S port Online A S 0.1 A s s oc iated Media Holdings Inc . 0.1 China Gatew ay Corporation 0.0 S NM G lobal Holdings 0.0 Dibz International, Inc . 0.0 S oc ial Media V enures , Inc . 0.0 0 500 1,000 1,500 2,000 2,500 3,000 3,500 4,000 Figure 8. Market Cap Ranking Source. Capital IQ TEV/Revenue (LTM) averages 4.2x: The overall average TEV/Revenue (LTM) multiple for our group is 4.2x – same as last week (Figure 9). However, this is skewed by Gree (3633-TSE) at 40.8x and Beyond Commerce Inc. (BYOC-OTCBB) at 35.5x. The median is only 1.5x. Note that we exclude multiples greater than 50x. Thirty-one companies have multiples under 1.5x.
  • 11. 0. 0 5. 0 10. 0 15. 0 20. 0 25. 0 30. 0 35. 0 40. 0 45. 0 (x) S ocial Media V enures , Inc . # Companies O AO R B C Information S y s tems 0.0 5.0 10.0 15.0 20.0 25.0 Source. Capital IQ Source. Capital IQ F luid Mus ic C a nada , Inc. A verage, 4.2 1 AIM O penwave S y s tems Inc . 20.6 2 AMEX U nis erve C ommunications C orp. 15.9 TSXV S handa Interac tive E ntertainment Figure 9. TEV/Revenue Ranking 13.0 L iveWorld Inc . NasdaqGS 6.8 T he P a rent C ompany OTCBB N orthgate T echnologies L imited T ree.C om, Inc. 5 13 22 1 KLSE 6.0 5.6 IAC /InterAc tiveC orp. 2 GTSM C DC C orp. 1 OM G a meO n C o Ltd. DXN Holdings B hd 9 OTCPK Figures 10 & 11. TEV/Revenue Ranking (Exchange, Country) ZipLoca l Inc . 4 TSX 4.0 3.3 3.0 2.1 Y nk K orea Inc . 5 NasdaqGM DADA S pA S hutterfly , Inc . 5 TSE S pa rk N etwork s , Inc . 0.00.00.00.10.10.10.20. 20.20.30.3 0.40.40.50.60.60.80.80.8 2 ASX J umbuck E nterta inment P ty Ltd. 1 HLSE Ac toz S oft C o. , Ltd. 2.0 1.8 1.5 1.5 United O nline Inc . 1 RTS S N M G loba l Holdings 7 Average TEV/LTM Revenue - By Exchange KOSE K aboos e Inc . 2 XTRA C y berplex Inc . G a mania Digital E ntertainment C o., 1 OSE 0.8 0.6 0.5 0.3 V alueC lic k Inc . 3 SEHK H anbitS oft, Inc . 1 NasdaqCM G ungHo O nline E ntertainment, Inc. 0.2 0.1 Modern T imes G roup Mtg AB G igaMedia Ltd. S NAP Intera ctive, Inc . 0.90. 91.01.11.11.11.11.11.21.21.4 1. 51.8 NetDra gon WebS oft, Inc . (x) S K C ommunica tions C o., Ltd. is eemedia Inc . 0.0 5.0 10.0 15.0 20.0 25.0 T E V/L T M R evenue (x) # Companies E olith C o. Ltd. United 1 Y edangO nline C orp. 20.6 Kingdom (Figure 11). Eleven of the companies are Canadian (average 7.7x revenue). O pen T ex t C orp. 1.92.02.12.22.22.4 3 Taiwan 16.3 P hotoC hannel Network s Inc . Canada J umpT V Inc . 11 7.7 NE O WIZ G ames C orporation 1 Malaysia 5.6 Lingo Media C orporation United XIN G AG 41 4.8 States MO K O .mobi L imited 2.62.63.03.1 3.13. 3 K ings oft C o. Ltd. 1 3.3 Sweden S ohu.com Inc . 9 China Wiz z ard S oftware C orporation 3.7 3.84.3 T otal S port O nline AS 2 1.9 1.5 Australia Acceleriz e New Media , Inc . 1 F rogs ter Intera ctiv e P ic tures AG 1.5 Finland Mix i, Inc . 4.64.7 5.25.4 6 Japan DigitalP os t Intera ctive, Inc. C ornerWorld C orporation 5.6 6.0 1 Russia G eoS entric O y j 6. 9 South 9 Average TEV/LTM Revenue - By Country 1.3 0.8 0.8 As s ociated Media Holdings Inc . Sixteen of the companies have EBITDA multiples under 7x. The median multiple is 7.6x (vs. 7.1x last week). Korea UO MO Media, Inc 8.1 8.6 2 Germany 0.5 C hines e G amer Interna tional 10.6 Hong T encent Holdings Ltd. 1 15.9 Kong B right T hings plc 20.6 1 Norway B igs tring C orp. 0.4 0.1 23.6 B ey ond C ommerc e, Inc. 35. 5 G ree, Inc . 40.8 Page 11 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 (22), trading at an average multiple of 6.0x (up from 5.8x last week). On a geographic basis, the 100x) is 9.0x LTM EBITDA (from 8.7x last week), led by Tencent Holdings Ltd.’s (700-SEHK) 32.5x multiple (Figure 12). TEV/EBITDA (LTM) averages 9.0x: The average multiple for the 30 companies with positive EBITDA (and multiples under United States has the most companies (41), trading at an average of 4.8x revenue (slightly up from 4.7x last week)
  • 12. Page 12 T E V/L T M E B IT DA (x) 35. 0 32. 5 29.5 30. 0 25. 0 21. 0 21. 1 20. 0 14. 3 15. 0 13. 3 11. 2 11. 3 A v era ge, 9.0 9. 5 9. 6 9. 7 9. 8 9. 8 8. 5 9. 0 10. 0 7. 6 7. 8 6. 3 6. 3 6. 9 5. 8 5. 9 4. 2 4. 5 4. 7 4.7 5. 0 3. 8 3. 9 2. 5 1.3 1. 7 0. 2 0. 3 0. 0 NEOWIZ G ames Corporation J umbuck Entertainment Pty Ltd. G ungHo Online Entertainment, Inc. G amania Digital Entertainment Co., Ltd. Chines e G amer International Unis erve Communications Corp. Northgate Technologies Limited DXN Holdings Bhd OAO R BC Information Sys tems Modern Times G roup Mtg AB G ameOn Co Ltd. CDC Corp. SK Communications Co., Ltd. Shanda Interactive Entertainment Ltd. United Online Inc. SNAP Interactive, Inc. Open Text Corp. XING AG Spark Networks , Inc. NetDragon WebSoft, Inc. G igaMedia Ltd. ValueClick Inc. IAC/InterActiveCorp. Sohu.com Inc. Cyberplex Inc. Mixi, Inc. Tencent Holdings Ltd. YedangOnline Corp. Kaboos e Inc. DADA SpA Shutterfly, Inc. Kings oft Co. Ltd. Actoz Soft Co., Ltd. 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 (22), trading at an average multiple of 7.8x. On a geographic basis, the United States has the most companies (41), trading at an average of 8.6x EBITDA (Figure 14). Eleven of the companies are Canadian (average 11.5x EBITDA). Average TEV/LTM EBITDA - By Exchange Average TEV/LTM EBITDA - By Country 35.0 32.5 35.0 30.0 30.0 29.5 25.0 29.5 25.0 20.0 (x) 16.3 20.0 13.3 (x) 15.0 13.3 9.6 9.3 8.6 7.8 15.0 12.4 11.5 10.0 7.7 7.6 9.7 8.6 8.6 7.1 6.3 5.9 5.2 2.4 10.0 7.7 6.3 5.0 1.7 0.3 5.9 5.0 3.9 0.0 OTCNO OTCPK OTCBB GTSM NasdaqGM NasdaqCM 0.0 TSE NasdaqGS OSE HLSE RTS KOSE AMEX TSX XTRA TSXV ASX 0.0 1.7 Germany Canada Hong China Japan United Finland Russia India Kong South Korea States Taiwan Australia Norway # Companies 2 1 5 2 5 13 5 22 2 1 4 1 1 9 7 2 1 # Companies 1 3 9 11 1 6 41 2 1 1 9 2 1 Figures 13 & 14. TEV/EBITDA Ranking (Exchange, Country) Source. Capital IQ P/E (LTM) averages 16.4x: The average multiple for the 32 companies with positive earnings (and multiples under 100x) is 16.4x LTM EPS (from 15.9x last week), led by TheStreet.com’s (TSCM-NASDAQ) 75.7x multiple (Figure 15). Thirteen of the companies have P/E multiples under 10x. The median is just 11.4x.
  • 13. Page 13 P /E L T M (x) 80.0 75.7 70.0 60.0 57.3 50.0 43.6 40.0 35.6 36.2 28.2 30.0 23.0 21.2 18.8 20.0 A verage, 16.4 15.6 16.7 12.9 13.4 13. 4 11.1 11.3 11.6 12.5 9. 2 9.2 10.3 10.0 7.4 7.4 3.3 3.9 4.9 1.5 1. 9 2.1 2.5 2.7 0.7 0.0 NE O WIZ G ames C orporation J umbuc k E ntertainment P ty L td. G a mania Digita l E ntertainment C o., L td. C hines e G amer International Northgate T echnologies Limited DXN Holdings B hd G ia nt Interactive G roup, Inc . G ameO n C o Ltd. Modern T imes G roup Mtg AB T he9 Limited Netea s e.com Inc. S handa Interactive E ntertainment L td. S NAP Intera ctiv e, Inc. Ngi G roup Inc. O pen T ex t C orp. T heS treet.com, Inc. XING AG Worlds .c om Inc. NetDragon WebS oft, Inc. S pa rk Network s , Inc. C y berplex Inc. G igaMedia Ltd. S ohu. com Inc. IAC /InterActiveC orp. Mix i, Inc. T enc ent Holdings Ltd. P erfect W orld C o. , Ltd. Y eda ngO nline C orp. K ings oft C o. Ltd. S hutterfly , Inc. DADA S pA Ac toz S oft C o., L td. 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 (22), trading at an average multiple of 12.8x. On a geographic basis, the United States has the most companies (41), trading at an average of 18.7x earnings (Figure 17). Eleven of the companies are Canadian (average 23.6x EPS). Average P/E - By Exchange Average P/E - By Country 80.0 75.7 70.0 70.0 57.3 60.0 60.0 57.3 50.0 50.0 36.2 (x) 40.0 30.1 40.0 (x) 30.0 23.4 23.6 18.7 16.7 30.0 18.7 18.1 20.0 12.8 12.1 11.6 11.3 10.3 11.6 11.3 9.2 20.0 10.0 8.8 10.3 9.2 8.4 10.0 6.0 0.0 0.0 OTCPK OTCBB NasdaqGM GTSM RTS TSE OSE HLSE NasdaqGS AMEX TSX XTRA TSXV ASX 0.0 Germany Russia Canada United Japan Finland China South Korea States Taiwan Australia Norway # Companies 5 1 5 9 2 5 1 22 4 1 2 2 2 13 # Companies 1 11 41 6 1 3 2 2 9 9 1 Figures 16 & 17. P/E Ranking (Exchange, Country) Source. Capital IQ
  • 14. Page 14 UPCOMING EVENTS E arnings C alendar C ompany Date & Time Quarter C onf C all Details S hutterfly, Inc. (Nas daqG S : S F L Y ) W ednes day, April 29, 2009 5: 00 P M (E DT ) Q 1 2009 877-591-4956 IAC /InterActiveC orp. (Nas daqG S : IAC I) W ednes day, April 29, 2009 11: 00 AM (E DT ) Q 1 2009 NA O penwave S ys tems Inc. (Nas daqG S : O P W V ) W ednes day, April 29, 2009 2: 00 P M (P DT ) Q 3 2009 800-289-0508 T ree. C om, Inc. (Nas daqG M: T R E E ) F riday, May 01, 2009 11: 00 AM (E DT ) Q 1 2009 877-407-0782 L ookS mart, L td. (Nas daqG M: L O O K ) Monday, May 04, 2009 5: 00:00 P M (E DT ) Q 1 2009 800-762-8779 V alueC lick Inc. (Nas daqG S : V C L K ) T ues day, May 05, 2009 4: 30 P M (E DT ) Q 1 2009 818-575-4677 United O nline Inc. (Nas daqG S : UNT D) T ues day, May 05, 2009 2: 00 P M (P DT ) Q 1 2009 877-681-3374 O pen T ext C orp. (Nas daqG S : O T E X) W ednes day, May 06, 2009 5: 00: 00 P M (E DT ) Q 3 2009 800-733-7571 Figure 18. Earnings Calendar Source. Company reports
  • 15. Page 15 C omparable C ompany Analys is > W eb 2 .0 P ric e P erformanc e C ompa ny Na me C ur rency T ic ker E x change U S D Ma rket C ap ($m) C urrent Pric e 1 Wk 1 Mth 3 Mth 6 Mth 1 Yr 52 We ek Acce le riz e N ew Me dia, Inc. US D A CL Z OT C B B 1 3.4 0.4 9 53.1 % 1 13.0 % 40 .0% -2.0% -31 .9% -37. 2% Actoz S of t C o., L td. KR W A 052 790 KO SE 9 3.2 1 4,70 0.0 0 0.0 % 3 3.0 % 38 .7% 83 .5% 82.6 % -8.1 % AQ Inte ractive , Inc. JPY 3 838 TSE 2 6.2 4 7,10 0.0 0 0.2 % 4 1.2 % 63 .5% 25 .1% -78 .6% -80. 0% As s ocia ted Media H oldings Inc. US D A S MH OT C P K 0 .1 0.0 0 0.0 % 7.1% -7 0.0% -8 1.3 % 36.4 % -97. 0% B igstring Corp. US D B S GC OT C B B 0 .7 0.0 1 1.4 % -6.7 % -1 7.6% -3 0.0 % -93 .2% -93. 6% B e tawave Corpora tion US D B W AV OT C B B 3 .2 0.1 1 -21. 4% -26. 7% -3 8.9% 0 .0% -70 .3% -73. 8% B e yond Commerce, Inc. US D B Y OC OT C B B 6 1.6 1.4 9 -0.7 % 1 92.2 % 60 .2% -2 5.5 % -36 .6% -54. 8% B right T hings plc GBP A IM:B G T AI M 5 .0 0.0 2 0.0 % 4.2% 34 .6% 20 .7% -50 .0% -50. 0% B roa dW ebAs ia Inc. US D B W BA OT C P K 3 8.2 0.4 5 0.0 % -11. 8% -5 5.4% -2 5.0 % -80 .0% -84. 5% C DC C orp. US D C H IN .A N as da qG S 12 6.3 1.1 8 -15. 7% 3.5% 40 .5% -3.7% -66 .1% -68. 9% C hina G ate wa y C orpora tion US D CGWY OT C B B 0 .0 0.0 0 1 00. 0% 1 00.0 % 0 .0% -8 6.7 % -96 .7% -95. 6% C hine s e G amer International TWD G TS M:3 083 GT S M 54 0.7 21 5.0 0 14.7 % 1 3.8 % 13 8.1% 18 8.6% 1 00. 9% 0.0 % C ornerW orld C orporation US D CWR L OT C B B 6 .4 0.1 0 -16. 7% -28. 6% -7 5.6% -5 0.0 % -80 .4% -87. 5% C yberplex Inc. C AD T S X:CX TSX 5 3.8 1.2 3 2.5 % 3 9.8 % 21 5.4% 17 3.3% 61.8 % -0.8 % D ADA S pA E UR C M :DA CM 12 3.7 5.8 5 17.3 % 2 3.9 % -9 .1% -1 8.8 % -60 .2% -63. 9% D XN Holdings B hd MY R DXN KL SE 2 0.2 0.3 2 1.6 % 1 2.5 % -1 1.3% -4.5% -43 .8% -43. 8% D ibz Inte rnational, Inc. US D DIB Z OT C P K 0 .0 0.0 0 -90. 0% -90. 0% -9 0.0% -9 8.0 % -98 .0% -98. 0% D igitalP ost Inte ra ctive , Inc. US D DG L P OT C B B 1 .3 0.0 2 20.0 % 0.0% -1 4.3% -6 4.0 % -90 .5% -93. 6% D igitalT own, Inc. US D DG T W OT C B B 6 3.6 2.3 5 -21. 7% -6.0 % -2 1.7% -6.0% -23 .0% -61. 5% D olphin Digital Me dia, Inc. US D DP DM OT C B B 2 6.1 0.5 3 -1.9 % -7.0 % -1 8.5% -4 7.0 % NM -53. 1% E olith C o. L td. KR W A 041 060 KO SE 4 0.7 76 0.0 0 21.6 % 4 3.4 % 47 .6% 83 .1% -23 .6% -29. 3% E xte ns ions , Inc. US D E XT I OT C P K 1 4.2 0.1 5 -25. 0% -25. 0% 18 5.7% 50 .0% 0.0 % -85. 1% F inancia l Media G roup, Inc. US D F NGP OT C B B 0 .3 0.0 0 -27. 3% -55. 6% -7 3.3% -9 8.9 % -98 .0% -99. 6% F luid M us ic Ca nada, Inc. C AD T S X:F MN TSX 1 5.0 0.3 5 0.0 % -12. 5% 12 .9% 0 .0% NM -82. 8% F rogs te r Interactive P icture s AG E UR FR G XT R A 2 7.8 9.0 6 8.5 % 3 9.4 % 83 .0% 16 2.6% 1 08. 3% -2.5 % G a ma nia Digital E ntertainment C o., L td. TWD 6 180 GT S M 14 4.4 3 2.1 5 0.8 % -4.9 % 49 .2% 14 7.3% -1. 4% -13. 0% G a me On C o L td. JPY 3 812 TSE 9 0.9 9 2,00 0.0 0 -0.2 % -2.3 % -2 4.7% 31 .6% -17 .1% -43. 7% G e oS e ntric O yj E UR G E O1V H LS E 4 6.7 0.0 4 0.0 % 3 3.3 % 0 .0% 0 .0% -42 .9% -42. 9% G iant Intera ctive G roup, Inc. US D GA NYS E 1,9 21. 0 8.5 0 11.8 % 2 3.0 % 40 .3% 32 .2% -45 .8% -50. 6% G iga Media Ltd. US D G IG M N as da qG S 36 4.7 6.7 5 -1.0 % 8.7% 2 .9% 17 .0% -57 .9% -66. 0% G ravity C o., L td US D G RV Y N as da qG M 2 5.0 0.9 0 -8.2 % 4 0.6 % 5 .9% 12 .5% -42 .3% -55. 0% G ree, Inc. JPY T S E :36 32 TSE 1,2 88. 0 5,65 0.0 0 3.7 % 1 1.2 % -1 .7% NM NM -10. 3% G ungH o O nline E ntertainment, Inc. JPY 3 765 OS E 16 2.7 13 9,00 0.0 0 13.7 % 1 6.4 % 41 .1% 36 .8% -52 .6% -68. 0% H anbitS oft, Inc. KR W A 047 080 KO SE 7 7.9 4,77 0.0 0 14.7 % 4 3.2 % 55 .1% 74 .1% 3.7 % -32. 0% IAC /InterActiveC orp. US D I ACI N as da qG S 2,2 43. 9 1 5.9 2 -1.7 % 3.5% 6 .0% -5.9% -63 .0% -68. 5% IAS E nergy, Inc. US D I AS C .A OT C B B 1 7.5 0.2 5 2.0 % 4 55.6 % 109 0.5 % 21 2.5% 16.3 % -28. 6% IdeaE dge, Inc. US D O TC B B :ID AE OT C B B 1 8.8 0.4 4 46.7 % 1 0.0 % -2 4.1% -7 6.8 % -31 .3% -84. 5% is ee media Inc. C AD IEE T S XV 4 .2 0.1 0 -16. 7% 1 1.1 % 11 .1% 66 .7% -64 .9% -71. 4% J umbuck E ntertainment P ty Ltd. AU D A S X:J M B AS X 1 6.4 0.4 7 -7.0 % -7.0 % -3 .1% 9 .4% -20 .5% -29. 0% J umpT V Inc. C AD T S X:J T V TSX 5 1.0 0.5 5 0.0 % 1 2.2 % 57 .1% -1 5.4 % -28 .6% -57. 0% K a boos e Inc. C AD T S X:K AB TSX 6 7.4 0.5 9 1.7 % 5 1.3 % 55 .3% 13 .5% -51 .2% -54. 6% K ings oft Co. Ltd. HKD 3 888 S E HK 51 5.9 3.7 2 4.5 % 2 4.0 % 39 .8% 86 .0% 10.4 % -13. 7% Lingo Media Corporation C AD T S XV :LM T S XV 9 .5 0.9 0 -18. 2% 5.9% -8 .2% -3 0.8 % -52 .6% -57. 1% Live World Inc. US D L VW D OT C P K 3 .1 0.1 0 0.0 % -23. 1% 23 3.3% -2 3.1 % -58 .3% -75. 6% LookS mart, Ltd. US D L OOK N as da qG M 2 3.1 1.3 6 19.9 % 3 2.8 % 1 .1% -2 0.3 % -71 .2% -71. 8% M agnitude Information S ys tems Inc. US D M AG Y OT C B B 6 .5 0.0 2 0.0 % 0.0% -4 4.0% 15 .4% -14 .3% -50. 0% M ixi, Inc. JPY 2 121 TSE 75 7.4 48 3,00 0.0 0 28.1 % 2 7.1 % -5 .7% -2 0.7 % -40 .1% -49. 5% M ode rn Times G roup Mtg AB SE K MT G B OM 1,6 68. 7 21 2.0 0 27.7 % 5 4.2 % 55 .6% 37 .2% -52 .2% -53. 4% M oggle , Inc US D M MOG OT C B B 8 3.5 2.3 0 15.0 % 1 5.0 % 53 .3% NM NM 0.0 % M OK O.mobi L imited AU D MKB AS X 4 .4 0.0 7 -12. 9% -18. 7% 85 .0% 54 .2% 80.5 % -26. 0% N E OW IZ G ames C orpora tion KR W A 095 660 KO SE 41 8.5 5 8,40 0.0 0 5.0 % 4 0.0 % 15 3.9% 38 6.7% 74.1 % -20. 4% N etDragon W ebS oft, Inc. HKD 7 77 S E HK 31 3.1 4.5 9 0.4 % 9.5% 73 .2% 58 .8% -59 .8% -66. 3% N ete as e.com I nc. US D NT E S N as da qG S 3,7 22. 3 3 0.2 5 4.6 % 2 3.0 % 65 .5% 47 .0% 30.1 % -3.2 % N eXplore Corpora tion US D N XP C OT C P K 4 1.8 0.7 5 7.1 % 2 5.0 % -6 .3% 15 .4% NM -48. 3% N gi G roup Inc. JPY 2 497 TSE 4 5.8 3 6,30 0.0 0 32.0 % 5 1.9 % -2 5.3% -5 2.1 % -71 .2% -78. 3% N orthgate Te chnologies L imited IN R 5 900 57 BS E 3 1.9 4 5.7 0 6.3 % 4 0.2 % 7 .5% -4 3.6 % -88 .8% -90. 3% Open T e xt Corp. US D O TE X N as da qG S 1,7 40. 7 3 3.5 4 -4.5 % -3.0 % 5 .9% 35 .5% -11 .4% -14. 2% Openwave S ys tems Inc. US D O PW V N as da qG S 9 9.1 1.1 9 -1.7 % 3 6.8 % 95 .1% 65 .3% -42 .8% -46. 6% P e rfect W orld C o., Ltd. US D P W RD N as da qG S 88 5.3 1 6.7 8 5.3 % 1 8.3 % 13 .5% -4.1% -47 .1% -49. 9% P hotoChannel N etwork s Inc. C AD T S XV :P N T S XV 4 3.3 1.5 5 -5.5 % 0.0% -8 .8% -1 6.2 % -56 .9% -62. 7% Quepa s a C orp. US D Q PSA N as da qC M 1 1.1 0.8 7 20.8 % -20. 2% -4 9.7% -5 6.3 % -67 .8% -74. 9% OA O R B C Information S ys tems US D R BC I R TS 10 5.7 0.7 6 52.4 % 7 3.2 % 14 7.8% -4 9.2 % -91 .1% -91. 6% S handa Interactive E ntertainme nt L td. US D S NDA N as da qG S 3,2 81. 8 4 7.3 0 6.4 % 2 8.6 % 68 .6% 84 .8% 32.5 % -12. 2% S hutte rf ly, Inc. US D S F LY N as da qG S 25 5.1 1 0.1 4 -3.5 % 9.5% 62 .5% 50 .9% -25 .6% -43. 6% S K C ommunications Co., Ltd. KR W A 066 270 KO SE 30 6.4 1 0,00 0.0 0 10.0 % 2 3.2 % 41 .8% 11 5.1% -33 .3% -49. 2% S N AP Inte ra ctive , Inc. US D S T VI OT C B B 7 .0 0.6 5 -7.1 % -18. 8% -3 4.3% 27 .5% -17 .7% -39. 8% S N M G lobal H oldings US D S NM N OT C P K 0 .0 0.0 1 1 40. 0% 5 00.0 % 190 0.0 % -9 5.0 % -99 .8% -99. 9% S ocia l Media V e nures , Inc. US D S MVI OT C P K 0 .0 0.1 5 -83. 0% -87. 5% -8 5.6% -8 5.1 % NM -97. 0% S ohu. com Inc. US D S OH U N as da qG S 1,9 26. 0 5 0.5 3 8.8 % 2 1.1 % 32 .8% -4.7% -35 .0% -44. 8% S ite s earch C orporation US D S TPC OT C B B 2 8.2 3.5 0 -30. 0% NM NM NM NM -30. 0% S park N etworks , Inc. US D L OV AM E X 4 6.3 2.2 5 -4.3 % -1.7 % -9 .3% -2 6.2 % -49 .8% -51. 6% S pectrumDN A, Inc. US D S P XA OT C B B 9 .7 0.2 0 -4.8 % 5.3% 10 0.0% -2 0.0 % NM -66. 7% T encent Holdings L td. HKD 7 00 S E HK 15, 325 .4 6 5.9 5 0.2 % 1 9.5 % 49 .0% 50 .1% 25.6 % -8.5 % T he P arent C ompany US D K IDS .Q OT C P K 0 .3 0.0 1 -14. 3% -20. 0% -7 6.0% -9 8.6 % -99 .6% -99. 7% T he 9 L imited US D NC TY N as da qG S 24 7.0 9.2 1 -4.0 % -33. 4% -4 2.6% -2 9.4 % -56 .9% -67. 7% T he S treet.com, Inc. US D T S CM N as da qG M 7 1.9 2.3 5 4.0 % 1 5.2 % -1 9.0% -3 9.4 % -68 .5% -75. 2% T otal S port Online A S N OK T OS O OT C N O 0 .1 0.0 3 -25. 0% -25. 0% -2 5.0% -4 0.0 % -70 .0% -70. 0% T ree.C om, Inc. US D TR EE N as da qG M 5 8.3 5.8 4 2.8 % 2 8.4 % 31 .5% 15 9.6% NM -47. 4% U nis erve C ommunications Corp. C AD T S XV :U S S T S XV 0 .8 0.0 4 -20. 0% -20. 0% 0 .0% -5 0.0 % -88 .6% -91. 1% U nited Online Inc. US D UNTD N as da qG S 39 0.2 4.7 5 -0.2 % 3.3% -2 3.9% -3 4.1 % -55 .0% -62. 0% U OMO Media , Inc US D U OMO OT C B B 5 .1 0.0 6 -25. 0% -25. 0% -2 5.0% -6 2.5 % -82 .9% -92. 5% V a lueC lick Inc. US D V CL K N as da qG S 84 0.6 9.6 9 4.4 % 1 9.9 % 56 .0% 50 .2% -51 .4% -53. 9% V O IS , Inc. US D V OIS OT C B B 2 .5 0.3 0 30.4 % -25. 0% -2 5.0% -6 0.0 % NM -94. 6% W ebze n Inc. US D W ZE N N as da qG M 3 3.0 2.7 8 5.7 % 5 0.3 % 89 .1% 20 5.5% 1.8 % -37. 5% W iz za rd S of twa re Corpora tion US D W ZE AM E X 2 5.9 0.5 5 -3.5 % 2 5.0 % -2 3.6% -4 2.7 % -73 .7% -76. 6% W oozyF ly, Inc. US D W ZY F OT C B B 2 .6 0.1 5 0.0 % 0.0% NM NM NM -96. 3% W orlds .com Inc. US D W DDD OT C B B 8 .9 0.1 7 0.0 % 3.0% 6 .3% -5.6% -39 .3% -57. 5% W ynds torm C orporation US D W YND OT C B B 1 .6 0.0 9 -47. 1% -25. 0% -2 5.0% -5 5.0 % NM -89. 4% XIN G AG E UR O 1B C XT R A 19 9.0 2 9.7 7 10.3 % 5.6% -4 .0% 10 .3% -19 .0% -36. 2% Y e dangOnline Corp. KR W A 052 770 KO SE 11 2.7 9,67 0.0 0 1.7 % 1 1.4 % 36 .4% 56 .0% -19 .4% -22. 9% Y nk K orea Inc. KR W A 023 770 KO SE 8 .6 4,70 0.0 0 5.9 % 2 2.2 % 19 .0% -3 8.0 % -65 .3% -69. 5% ZipLocal Inc. C AD T S XV :ZIP T S XV 0 .3 0.0 1 0.0 % -66. 7% -7 5.0% -5 0.0 % -96 .4% -97. 1% H igh 1 40. 0% 5 00.0 % 190 0.0 % 38 6.7% 1 08. 3% 0.0 % Low -90. 0% -90. 0% -9 0.0% -9 8.9 % -99 .8% -99. 9% A vera ge 451.8 2.5% 21.5% 52.3% 13.2% -36.9% -57.0% M edian 0.1 % 1 1.1 % 6 .1% -3.9% -48 .4% -57. 1% Figure 19. Price Performance Source. Capital IQ
  • 16. Page 16 C omparable C ompany A nalys is > W eb 2.0 V aluatio n Multiples P rimary US D Market TE V/LT M TE V/ N TM TE V/LT M TE V/NTM C om pany Nam e S ec to r Co untry E xc hange Tic ker Cap ($m) R evenue R evenue E BITDA E BITDA P /LT M E P S P /NT M E P S P /TangBV Acce le rize N ew Me dia, Inc. D irect Marketing U nite d S tates OT C B B AC LZ 13. 4 4.7 x - - - - - - Actoz S of t C o., L td. G aming S outh K ore a K OS E A 052 790 93. 2 0.9 x - 4.7 x - 15 .6x - 1 .8x AQ Inte ractive , Inc. G aming J a pan TSE 3 838 26. 2 - - - - - - 0 .4x As s ocia ted Media Holdings Inc. Mobile U nite d S tates OT C P K AS MH 0. 1 8.1 x - - - - - - B igstring Corp. Ins ta nt Mes s aging U nite d S tates OT C B B BS G C 0. 7 23.6 x - - - - - - B e tawave Corpora tion Me dia U nite d S tates OT C B B B WA V 3. 2 - - - - - - 0 .3x B e yond Commerce, Inc. S ocia l Ne tworking U nite d S tates OT C B B BYO C 61. 6 35.5 x - - - - - - B right T hings plc S ocia l Ne tworking U nite d K ingdom AIM AIM:B G T 5. 0 20.6 x - - - - - - B roa dW ebAs ia Inc. S ocia l Ne tworking U nite d S tates OT C P K B WB A 38. 2 - - - - - - - C D C C orp. G aming H ong K ong N as da qG S C HIN .A 1 26. 3 0.4 x 0.5x 9.7 x 6.5x - 3 4.7 x - C hina G ate wa y C orpora tion Mobile U nite d S tates OT C B B CG W Y 0. 0 0.0 x - - - - - - C hine s e G amer International G aming T a iwan GTS M G T S M:308 3 5 40. 7 10.6 x - 21.0 x - 28 .2x - 9 .5x C ornerW orld C orporation C ontent U nite d S tates OT C B B CWR L 6. 4 6.0 x - - - - - - C yberplex Inc. Advertis ing C anada TSX T S X:C X 53. 8 1.1 x 0.8x 13.3 x 8.6x 11 .3x 1 1.2 x 1 1.6x D AD A S pA S ocia l Ne tworking Italy CM CM:DA 1 23. 7 0.8 x - 4.7 x - 7. 4x - - D XN Holdings B hd S ocia l Ne tworking Malays ia KL SE D XN 20. 2 0.5 x - 3.9 x - 3. 9x - 0 .4x D ibz Inte rnational, Inc. S NS A pps U nite d S tates OT C P K D IB Z 0. 0 - - - - - - - D igitalP ost Inte ra ctive , Inc. C ontent U nite d S tates OT C B B DGL P 1. 3 5.6 x - - - - - - D igitalT own, Inc. S ocia l Ne tworking U nite d S tates OT C B B D G TW 63. 6 - - - - - - - D olphin D igital Me dia, Inc. S ocia l Ne tworking U nite d S tates OT C B B DP DM 26. 1 - - - - - - - E olith C o. L td. G aming S outh K ore a K OS E A 041 060 40. 7 2.2 x - - - - - - E xte ns ions , Inc. C ontent U nite d S tates OT C P K E XT I 14. 2 - - - - - - - F inancia l Media G roup, Inc. D irect Marketing U nite d S tates OT C B B F NGP 0. 3 - - - - - - - F luid Mus ic Ca nada, Inc. Me dia U nite d S tates TSX T S X:F MN 15. 0 0.0 x 0.0x - - - - 1 .2x F rogs te r Interactive P icture s AG G aming G ermany XT R A F RG 27. 8 5.2 x - - - - - 2 .6x G a ma nia D igital E ntertainment C o., L td. G aming T a iwan GTS M 6 180 1 44. 4 1.1 x - 7.8 x - 18 .8x - 2 .0x G a me On C o L td. G aming J a pan TSE 3 812 90. 9 0.4 x - 1.7 x - 9. 2x - 1 .2x G e oS e ntric O yj Mobile F inland H LS E G E O1V 46. 7 6.9 x - - - - - 4 .9x G iant Intera ctive G roup, Inc. G aming C hina NYS E GA 1,9 21. 0 - - - - 1. 9x 1 3.9 x 0 .4x G iga Media Ltd. G aming T a iwan N as da qG S G IG M 3 64. 7 1.5 x 1.5x 6.3 x 6.4x 11 .6x 1 0.6 x 3 .3x G ravity C o., L td G aming S outh K ore a N as da qG M GR VY 25. 0 - - - - - - - G ree, Inc. S ocia l Ne tworking J a pan TSE T S E :3 632 1,2 88. 0 40.8 x - - - - - 1 9.8x G ungH o O nline E ntertainment, Inc. Me dia J a pan OS E 3 765 1 62. 7 1.2 x - 6.9 x - - - - H anbitS of t, Inc. G aming S outh K ore a K OS E A 047 080 77. 9 1.2 x - - - - - 2 .6x IAC /InterActiveC orp. Me dia U nite d S tates N as da qG S IAC I 2,2 43. 9 0.3 x 0.4x 7.6 x 2.9x 16 .7x 2 7.4 x 1 .1x IAS E nergy, Inc. V ide o C anada OT C B B IA S C .A 17. 5 - - - - - - - IdeaE dge, Inc. S ocia l Ne tworking U nite d S tates OT C B B OT C B B :IDA E 18. 8 - - - - - - 1 3.7x is ee media Inc. C ontent C anada T S XV IE E 4. 2 2.1 x - - - - - 2 .4x J umbuck E ntertainment P ty Ltd. S ocia l Ne tworking A us tralia AS X AS X:J MB 16. 4 0.9 x - 2.5 x - 7. 4x - 1 .9x J umpT V Inc. V ide o C anada TSX T S X:J T V 51. 0 2.6 x - - - - - 2 .8x K a boos e Inc. C ontent C anada TSX TS X:K AB 67. 4 1.1 x 1.0x 11.2 x 6.3x - - - K ings oft Co. Ltd. G aming C hina S E HK 3 888 5 15. 9 3.7 x - 9.5 x - 13 .4x - 3 .1x Lingo Media Corporation Le arning C anada T S XV TS XV :LM 9. 5 3.1 x - - - - - - Live World Inc. S ocia l Ne tworking U nite d S tates OT C P K LV W D 3. 1 0.2 x - - - - - 1 .4x LookS mart, Ltd. D irect Marketing U nite d S tates N as da qG M L OOK 23. 1 - - - - - - 0 .8x Magnitude Information S ys tems Inc. S ocia l Ne tworking U nite d S tates OT C B B MAG Y 6. 5 - - - - - - - Mixi, Inc. S ocia l Ne tworking J a pan TSE 2 121 7 57. 4 5.4 x - 14.3 x - 36 .2x - 5 .9x Mode rn Times G roup Mtg AB Me dia S we den OM MT G B 1,6 68. 7 1.4 x 1.3x 8.5 x 1 0.9 x 4. 9x 1 2.4 x - Moggle , Inc G aming U nite d S tates OT C B B MMO G 83. 5 - - - - - - - MOK O.mobi L imited S ocia l Ne tworking A us tralia AS X MK B 4. 4 3.3 x - - - - - 3 .8x N E OW IZ G ames C orpora tion G aming S outh K ore a K OS E A 095 660 4 18. 5 3.0 x - 11.3 x - 23 .0x - 1 3.6x N etD ragon W ebS oft, Inc. G aming C hina S E HK 777 3 13. 1 1.9 x - 4.2 x - 10 .3x - 1 .7x N ete as e.com I nc. G aming C hina N as da qG S NT E S 3,7 22. 3 - - - - 2. 5x 1 5.1 x 0 .7x N eXplore Corpora tion C ontent U nite d S tates OT C P K N XP C 41. 8 - - - - - - - N gi G roup Inc. Me dia J a pan TSE 2 497 45. 8 - - - - 13 .4x - 0 .7x N orthgate Te chnologies L imited D irect Marketing India BS E 59 005 7 31. 9 0.2 x - 1.3 x - 2. 1x - - Open T e xt Corp. C ollaboration C anada N as da qG S O TE X 1,7 40. 7 2.4 x 2.2x 9.6 x 8.4x 35 .6x 1 4.0 x - Openwave S ys tems Inc. Mobile U nite d S tates N as da qG S OP W V 99. 1 0.1 x 0.1x - 1.3x - 3 9.7 x 1 .3x P e rf ect W orld C o., Ltd. G aming C hina N as da qG S PW R D 8 85. 3 - - - - 1. 5x 8.2x 0 .5x P hotoChannel N etwork s Inc. D igital Imaging C anada T S XV T S XV :P N 43. 3 2.6 x 1.8x - 5.5x - 2 0.1 x 9 .5x Quepa s a C orp. S ocia l Ne tworking U nite d S tates N as da qC M QP S A 11. 1 - - - - - - 8 .3x OA O R B C Information S ys tems Me dia R us s ia R TS R B CI 1 05. 7 0.0 x - 0.2 x - - - - S handa Interactive E ntertainme nt L td. G aming C hina N as da qG S S NDA 3,2 81. 8 0.1 x 0.7x 0.3 x 1.6x 2. 7x 1 5.2 x 1 .3x S hutte rf ly, Inc. D igital Imaging U nite d S tates N as da qG S S FL Y 2 55. 1 0.8 x 0.8x 5.9 x 5.3x 57 .3x - 1 .5x S K C ommunications Co., Ltd. S e arch S outh K ore a K OS E A 066 270 3 06. 4 2.0 x - 21.1 x - - - - S N AP Inte ra ctive , Inc. D ating U nite d S tates OT C B B S TVI 7. 0 1.8 x - 5.8 x - 9. 2x - 4 .6x S N M G lobal H oldings Me dia U nite d S tates OT C P K S N MN 0. 0 1.1 x - - - - - - S ocia l Media V e nures , Inc. S ocia l Ne tworking U nite d S tates OT C P K S MV I 0. 0 0.0 x - - - - - - S ohu. com Inc. G aming C hina N as da qG S S OH U 1,9 26. 0 3.8 x 3.2x 9.0 x 7.6x 12 .5x 1 2.5 x 5 .9x S ite s earch C orporation S ocia l Ne tworking U nite d S tates OT C B B STPC 28. 2 - - - - - - 4 0.1x S park N etworks , Inc. S ocia l Ne tworking U nite d S tates AME X L OV 46. 3 0.8 x - 3.8 x - 11 .1x - - S pectrumDN A, Inc. Me dia U nite d S tates OT C B B S P XA 9. 7 - - - - - - 1 4.7x T encent Holdings L td. P orta l C hina S E HK 700 15,3 25. 4 15.9 x - 32.5 x - 43 .6x - 1 7.8x T he P arent C ompany Me dia U nite d S tates OT C P K K ID S .Q 0. 3 0.2 x - - - - - - T he 9 L imited G aming C hina N as da qG S NC T Y 2 47. 0 - - - - 0. 7x 1 0.1 x 0 .1x T he S treet.com, Inc. Me dia U nite d S tates N as da qG M TSCM 71. 9 - - - - 75 .7x - 0 .7x T otal S port Online A S Me dia N orway OT C NO T OS O 0. 1 4.6 x - - - - - - T ree.C om, Inc. P orta l U nite d S tates N as da qG M TR E E 58. 3 0.3 x 0.3x - - - - 0 .9x U nis erve C ommunications Corp. S ocia l Ne tworking C anada T S XV T S XV :U S S 0. 8 0.1 x - 29.5 x - - - - U nited Online Inc. Me dia U nite d S tates N as da qG S U N TD 3 90. 2 1.0 x 0.7x 4.5 x 2.9x - 6.6x - U OMO Media , Inc Me dia C anada OT C B B U OMO 5. 1 8.6 x - - - - - - V a lueC lick Inc. Me dia U nite d S tates N as da qG S VC LK 8 40. 6 1.1 x 1.3x 6.3 x 5.5x - 1 6.4 x 8 .2x V O IS , Inc. S ocia l Ne tworking U nite d S tates OT C B B VOIS 2. 5 - - - - - - 5 .6x W ebze n Inc. G aming S outh K ore a N as da qG M W ZE N 33. 0 - - - - - - 0 .0x W iz za rd S of twa re Corpora tion P odcas ting U nite d S tates AME X W ZE 25. 9 4.3 x - - - - - - W oozyF ly, Inc. S ocia l Ne tworking U nite d S tates OT C B B W ZY F 2. 6 - - - - - - - W orlds .com Inc. C ontent U nite d S tates OT C B B W DD D 8. 9 - - - - 3. 3x - - W ynds torm C orporation C ontent U nite d S tates OT C B B W YND 1. 6 - - - - - - - XIN G AG S ocia l Ne tworking G ermany XT R A O 1B C 1 99. 0 3.1 x - 9.8 x - 21 .2x - 5 .5x Y e dangOnline Corp. G aming S outh K ore a K OS E A 052 770 1 12. 7 2.2 x - 9.8 x - 12 .9x - 6 .0x Y nk K orea Inc. G aming S outh K ore a K OS E A 023 770 8. 6 0.6 x - - - - - - ZipLocal Inc. D irectory C anada T S XV T S XV :ZIP 0. 3 0.6 x - - - - - - H igh 15,3 25. 4 40.8 x 3.2x 32.5 x 1 0.9 x 75 .7x 3 9.7 x 4 0.1x Low 0. 0 0.0 x 0.0x 0.2 x 1.3x 0. 7x 6.6x 0 .0x A vera ge 451. 8 4.2x 1.0x 9.0x 5.7x 16.4x 16.7x 5.2x Median 39. 4 1.5 x 0.8x 7.6 x 5.9x 11 .4x 1 4.0 x 2 .5x Figure 20. Valuation Comparison Source. Capital IQ
  • 17. Page 17 C omparable C ompany A nalys is > W eb 2.0 Su mmary b y C ountry C om pany Nam e U S D Market Cap ($m) Avg US D Mar ket C ap ($m) U S D LT M T otal R ev ($m) U S D LT M Total E B IT DA ($m) E B IT DA % U nited S tates 41 C hina 28, 137.7 China 3,126. 4 U nited S ta tes 3, 744. 3 C hina 1,655. 9 C hina 48. 4% C anada 11 U nited S tates 4, 524.4 S weden 1,668. 7 C hina 3, 353. 2 S weden 253. 7 Aus tral ia 37. 2% C hina 9 J a pan 2, 370.8 Japan 395. 1 S weden 1, 572. 8 U nited S ta tes 240. 1 T aiwa n 29. 7% S outh K orea 9 C anada 1, 993.6 Ta iwa n 349. 9 C a na da 944. 7 C a na da 186. 1 J a pa n 26. 1% J a pa n 6 S weden 1, 668.7 Ca na da 181. 2 S outh K orea 552. 0 J apan 132. 4 I ndia 17. 6% T a iwa n 3 S outh K orea 1, 115.9 Hong K ong 126. 3 J a pa n 503. 0 T a iwan 85. 5 S weden 16. 1% A ustra lia 2 T a iwa n 1, 049.8 S outh K orea 124. 0 H ong K ong 428. 1 S outh K orea 63. 0 I ta ly 16. 0% G ermany 2 G erma ny 226.7 Ita ly 123. 7 T aiwan 348. 0 I taly 35. 3 M a la ys ia 13. 3% N orway 1 H ong K ong 126.3 G erma ny 113. 4 I ta ly 221. 2 I ndia 23. 8 R uss ia 13. 1% H ong K ong 1 I ta ly 123.7 United S tates 110. 4 R uss ia 141. 0 H ong K ong 18. 8 S outh K orea 4.7% F inla nd 1 R uss ia 105.7 R us sia 105. 7 I ndia 135. 1 R uss ia 18. 4 H ong K ong 4.4% I ta ly 1 F inland 46.7 Finland 46. 7 M a la ys ia 76. 7 G erma ny 11. 4 U nited S ta tes -11.0% U nited K ingdom 1 I ndia 31.9 India 31. 9 G ermany 50. 8 M alays ia 10. 2 G ermany -14.3% I ndia 1 Aus tra lia 20.8 Malay sia 20. 2 Aus tra l ia 13. 8 Aus tralia 2. 6 C anada -18.0% S weden 1 M alays ia 20.2 Australia 10. 4 F inla nd 5. 7 N orway -1. 0 N orway -50.6% R us sia 1 U nited K ingdom 5.0 United K ingdom 5. 0 N orwa y 2. 0 U nited K ingdom -1. 6 U nited K ingdom #DI V /0! M a la ys ia 1 N orway 0.1 Norway 0. 1 U nited K ingdom 0. 2 F inland -12. 8 F inla nd #DI V /0! G rand To tal 92 G rand T otal 41,568.1 G rand Total 451.8 G rand T otal 12,092.7 G r and T otal 2,721.9 G rand T otal 6.9% Figure 21. Comparison by Country Source. Capital IQ C omparable C o mpan y A nalys is > W eb 2.0 Su mmary b y Ex c hange C om pan y Nam e U S D Market Cap ($m) Avg US D Market C ap ($m) U S D LT M T otal R ev ($m) U S D LT M To tal E B IT DA ($m) E B IT DA % OT C B B 22 S E HK 16, 154.3 S E HK 5,384. 8 OM 1, 572. 8 N a sdaqG S 1,522. 8 NYS E 61. 9% N a s daqG S 13 N a sdaqG S 16, 123.0 NY S E 1,921. 0 N asdaqG S 492. 7 S E HK 598. 8 S E HK 44. 4% OT C P K 9 TSE 2, 208.2 OM 1,668. 7 S EHK 418. 5 OM 253. 7 AS X 37. 2% K OS E 7 NYS E 1, 921.0 Nas daqG S 1,240. 2 NYS E 233. 6 NYS E 144. 6 GT S M 32. 5% TSE 5 OM 1, 668.7 TS E 441. 6 CM 221. 2 TSE 111. 9 TSE 27. 7% N a s daqG M 5 K OS E 1, 057.9 G TS M 342. 5 R TS 141. 0 K OS E 60. 2 N a sdaqG S 26. 8% T S XV 5 GT SM 685.1 OS E 162. 7 BSE 135. 1 GT S M 39. 4 OS E 17. 8% TSX 4 O T CB B 368.8 K OS E 151. 1 OS E 114. 9 CM 35. 3 BSE 17. 6% S E HK 3 XT RA 226.7 CM 123. 7 N asdaqG M 84. 6 BSE 23. 8 OM 16. 1% A ME X 2 N a sdaqG M 211.3 XT R A 113. 4 GTS M 78. 8 OS E 20. 5 CM 16. 0% XT R A 2 TSX 187.1 RTS 105. 7 TSE 77. 6 R TS 18. 4 K LS E 13. 3% ASX 2 OS E 162.7 TS X 46. 8 K LS E 76. 7 X TR A 11. 4 R TS 13. 1% GT S M 2 CM 123.7 HL S E 46. 7 K OS E 70. 6 K LS E 10. 2 K OS E 6.1% OT C NO 1 R TS 105.7 Nas daqG M 42. 3 TSX 32. 8 AM E X 6. 3 N a sdaqG M -0. 9% HLS E 1 O T CP K 97.7 AME X 36. 1 AM E X 31. 7 AS X 2. 6 XT RA -14.3% NY S E 1 AM E X 72.2 BSE 31. 9 XT R A 25. 4 OT CNO -1. 0 TSX -14.8% CM 1 T S XV 58.0 K LS E 20. 2 OT CP K 21. 0 AI M -1. 6 T S XV -15.6% BSE 1 HLS E 46.7 O TC B B 16. 8 T S XV 9. 6 TSX -6. 4 OT CP K -27.9% N a s daqC M 1 BSE 31.9 TS X V 11. 6 AS X 6. 9 T S XV -9. 8 OT CB B -31.8% OS E 1 AS X 20.8 Nas daqC M 11. 1 H LS E 5. 7 N a sdaqC M -11. 4 AM E X -38.3% A IM 1 K LS E 20.2 O TC P K 10. 9 OT CB B 2. 0 HLS E -12. 8 OT CNO -50.6% OM 1 N a sdaqC M 11.1 AS X 10. 4 OT CN O 2. 0 N a sdaqG M -16. 1 AI M #DI V /0! R TS 1 AI M 5.0 AIM 5. 0 AI M 0. 2 OT CP K -26. 5 N a sdaqC M #DI V /0! K LS E 1 O T CN O 0.1 O TC NO 0. 1 N asdaqC M 0. 1 OT CB B -52. 5 HLS E #DI V /0! Gr an d To tal 92 G rand T otal 41, 568.1 G ran d To tal 451. 8 G rand T otal 145. 7 G rand T otal 2,721. 9 G rand T otal 6.9% Figure 22. Comparison by Exchange Source. Capital IQ
  • 18. Page 18 Financing - Last Three Months (US$ m) Month C ompany Name C ountry Angel/S eed Debt financing P IP E S eries A S eries B S eries C S eries D S eries E S ereis A G rand Total F eb-09 Twitter US A 35. 0 35. 0 S ynthas ite S outh Africa 20. 0 20. 0 Tremor Media US A 18. 0 18. 0 Offerpal Media US A 15. 0 15. 0 Imagini UK 13. 5 13. 5 E mergent Game Technologies US A 12. 5 12. 5 Outbrain Is rael 12. 0 12. 0 Tvtrip F ra nce 9. 0 9. 0 Tongxue C hina 6. 0 6. 0 Oodle US A 5. 6 5. 6 TextDigger US A 4. 3 4. 3 OneS pot US A 4. 2 4. 2 Mixpo C ana da 4. 0 4. 0 F etchDog US A 4. 0 4. 0 Virtual F airground Netherlands 4. 0 4. 0 7 B illion P eople US A 3. 0 3. 0 F amilyL ink.com US A 2. 9 2. 9 W his tleB ox US A 2. 3 2. 3 Mendeley UK 2. 0 2. 0 Outright US A 2. 0 2. 0 Tvinc i Is rael 1. 6 1. 6 F iltrbox US A 1. 4 1. 4 MMO L ife Netherlands 1. 3 1. 3 C ake F inancial US A 1. 3 1. 3 fav.or.it UK 0. 7 0. 7 F eb-09 Total 13.3 24.8 76.4 58.6 12.5 185.5 Mar-09 Kaixin001.com China 20. 0 20. 0 Vidyo US A 15. 0 15. 0 B uzznet US A 12. 5 12. 5 L endingC lub US A 12. 0 12. 0 S endMe Inc . US A 12. 0 12. 0 Auditude US A 10. 5 10. 5 G lam Media US A 10. 0 10. 0 S uperS ec ret US A 10. 0 10. 0 GoViral UK 8. 8 8. 8 G reys tripe US A 5. 5 5. 5 OMG P OP US A 5. 0 5. 0 Apture US A 4. 1 4. 1 S imulmedia US A 4. 0 4. 0 Tynt C ana da 3. 9 3. 9 AnyS ource Media US A 3. 2 3. 2 P ixazza US A 3. 1 3. 1 B it.ly US A 2. 0 2. 0 Hunch US A 2. 0 2. 0 S ports C ompos ite DE US A 2. 0 2. 0 AdultS pac e US A 1. 3 1. 3 Myngle Netherlands 1. 3 1. 3 33Acros s US A 0. 8 0. 8 Three Melons Argentina 0. 6 0. 6 Mar-09 Total 1.3 1.3 0.6 41.1 50.3 43.0 12.0 10.0 159.5 Apr-09 C ollec tive Media US A 20. 0 20. 0 GOOM Radio France 16. 0 16. 0 The R ubicon P roject US A 8. 0 5. 0 13. 0 C ellufun US A 10. 0 10. 0 S canS c out US A 8. 1 8. 1 Batanga USA 7. 5 7. 5 DoubleTwis t US A 5. 0 5. 0 S oc ialtext US A 4. 5 4. 5 SoundCloud Germany 3. 3 3. 3 TubeMogul US A 3. 0 3. 0 Tribal Nova Canada 2. 5 2. 5 Tripbase USA 2. 0 2. 0 S oc ialcas t US A 1. 4 1. 4 S can & Target F ra nce 1. 3 1. 3 Foodista USA 0. 6 0. 6 Apr-09 Total 9.4 8.0 24.3 42.5 4.1 12.0 2.0 102.3 G rand Total 24.0 9.3 0.6 90.1 169.1 105.7 24.0 22.5 2.0 447.3 Figure 23. Financing, Last Three Months Source. Company reports
  • 19. Page 19 C ompany Des c riptio ns - C urrent Mo nth C apital Market A c tivity C ompany HQ W ebs ite Des criptio n B atanga U nited S ta tes www. ba ta nga .c om B atanga, Inc. opera tes a s a media a nd enterta inment c ompany for His pa nic s. I t offers online entertainment, suc h as Internet ra dio, mus ic videos , artist interviews, a nd L atin-centric enterta inment c ontent, a s well a s s ocia l network ing. T he compa ny publishes ma ga z ines, a s well as promotes a nd executes cus tom and s ponsor driven music -oriented ev ents . I t a lso owns a d network ta rgeting His panic s. T he company wa s founded in 1999 a nd is ba s ed in C oral G ables , Florida with an a dditional offic e in N ew Y ork. As of Dec ember 2, 2005, B a ta nga , I nc . operates a s a subs idiary of Hi spa nic M edia, I nc. C ellu fun , LL C U nited S ta tes www. cellufun. com C ellufun, LL C opera tes as a n ad s ponso red mobile ga ming portal. The company’ s portal provides free enterta inment content, a s well a s cas ua l, connected, a nd multiplay er games for ex isting a nd next-generation W eb-ena bled mobile phones . It a l so offers free s ingle-pla yer games, a s well as multi-player vers ions on a s ubs cription ba s is . The c ompany ena bles subs cribers to persona liz e their ga ming profile; sa ve scores ; crea te tea ms; partic ipa te in tournaments ; a nd sha re informa tion rela ted to tips , trick s, a nd bra gging rights . C ellufun wa s founded in 2005 and is bas ed in New Y ork, N ew Y ork. C ollec tive Media, Inc . U nited S ta tes www. collective-media . com C ollective Media , I nc. opera tes a s a n online a dvertising network tha t specializ es in audienc e ta rgeting a nd optimiz ation s olutions for publishers a nd a dvertis ers in the United S ta tes. I t provides con text, beha v ior, re-ta rgeting, demogra phic, a nd geogra phic ta rgeting; a nd dashboard, a reporting interfac e that pres ents a nd ma nipula tes ad performa nce da ta generated by ca mpa igns. T he compa ny a ls o offers a network of online news s ites , a s well as enterta inment, s ports , a nd health si tes . In addition, it provides bra nd a dvertis ing a nd direct ma rketing services . T he company wa s founded in 2005 a nd is bas ed in N ew Y ork, New Y ork . do ubleT wis t Corpo ration U nited S ta tes www. doubletwis t. com doubleTwist C orpora tion des igns a nd develops entertai nment s oftwa re a pplica tions . T he company applica tions s hares a nd s y nchroniz es pictures , video, and audio to medi a dev ices . I t offers doubleT wis t desk top, a n a pplica tion tha t ena bles c lients to tra ns fer, sha re, a nd sy nc persona l media ; a nd Twis t me! , a network applica tion tha t a llows us ers to share photos, video, and audio files from the c lient’s profile pages. doubleTwist C orpora tion wa s founded in 2007 a nd is ba s ed in S an F ra nc isco, Ca li fornia with an a dditiona l office in O s lo, Norway. F o odis ta U nited S ta tes www. foodista .com F oodis ta is a W iki pedia for rec ipes, food, a nd c ooking. R eci pes are contributed a nd edited in a wik i in a n a ttempt to avoid numerous repeats of the s ame rec ipe. The s ite ta k es a structured da ta a pproa ch a ki n to I MD B , where every ingredient, c ooking technique, utens il, and dis h G o On Media F rance www. goomradio.c om links to Medi a other mention on the ssta tions . I t broa dc asts music , wea ther, news , a nd music news through I nternet. In addition, the c ompany G o O n every opera tes digita l radio ite. opera tes a community for interaction between the c reators of ra di os. T he c ompa ny was founded in 2007 a nd is ba sed in S aint C loud, Mixerc as t, In c . U nited S ta tes www. mixerc a st.com F ra nc e. s t, I nc . provides s oc ial mark eting a pplic ation pla tform that ena bles c ontent pub lishers a nd a dvertis ers to rea ch a udienc es a cross the Mix erca soc ia l W eb. It offers MC ast P latform that includes a s et of tools and s ervi ces to c reate, distribute, monetiz e, a nd track va rious types of social ma rk eting a pplic a tions, inc luding widgets, ma s h-ups, F a c ebook a nd M yS pac e apps, and portab le c ontent or bra nd experienc es. M ixerc ast, Inc . wa s formerly k nown a s Na noc ast L a bs, I nc . The compa ny wa s founded in 2005 and is ba s ed in S a n M a teo, C alifornia . S c an & Target F rance www. s cana ndta rget. c om S ca n & Target provides s oftwa re a s a serv ice solution for the ana lys is and filtering of tex t user genera ted content. I t offers its a na lys is solution for va rious a pplica tions, s uc h a s modera ting and monetiz ing us er generated content, routing and qua lity c ontrol, v alida ting a ds a nd listings , a nd populating cus tomer relations hip ma na gement da ta bases . T he compa ny provides its s olution in various platforms , suc h as Internet, mobile, a nd intera ctive televis ion for pub lishers of onl ine communities, modera ting s ervice providers , a nd suppliers of technology solutions . S ca n & Ta rget wa s founded in 2007 and is ba s ed in P utea ux, F rance. S c anS co ut, In c. U nited S ta tes www. s cans cout. com S ca nS cout, Inc. opera tes as a n online video advertising network. I t s erves publis hers , advertise rs , a nd ad network s . The company was founded in 2005 a nd is ba s ed in B oston, M ass a chus etts with additiona l offic es in New Y ork a nd L os Angeles . S ocialcas t U nited S ta tes www. s ocialca st. com S oci a lcas t provides soc ial network ing pla tforms a nd s olutions for both consumer-fa cing clients and enterpris e cus tomers . The compa ny wa s founded in 2005 a nd is ba s ed in Irv ine, C al ifornia . S ocialtext In corporated U nited S ta tes www. s ocialtext.com S oci a ltext Inc orpora ted develops enterpris e s oc ia l s oftware. T he company focus es on offering c olla bora tion platform tha t a llows organizations to c ollaborate. It offers P eople, whic h ena bles users to integra te s oc ial network ing with enterprise colla bora tion; W eblog tha t supports colla bora tiv e a nd ongoing conv ersa tions a mong collea gues ; W orks pa c e, an enterpris e wiki for sea rc hing informa tion and people; a nd S ig na ls tha t a mplifies, cla rifies, and complements other c ollabora tion ac tiv ities , a s well a s prov ides a medium for information s ha ring. The c ompa ny a ls o provides D ashboa rd, which aggrega tes content from S oc ialtex t wik i pa ges , the W eb, a nd enterprise sy stems; an d S oci a lC alc s preadsheets tha t inc lude informa tion from other sprea ds heets or works pace pa ges . The compa ny wa s founded in 2002 a nd is based in P a lo Alto, C a lifornia . S oundClou d L td. G erma ny s oundc loud.c om S oundC loud L td. provides an online audio pla tform for recei ving, s ending, and distributing music for a rtis ts , record la bels , a nd other music profes s iona ls. T he compa ny was founded in 2007 a nd is ba sed in B erlin, G erma ny . R ubicon P roject, Inc . U nited S ta tes www. rubiconproject.com R ubic on P roject, I nc. , an a dv ertis ing technology c ompa ny , provides online a dv ertis ing solutions to W eb publishers a nd a d networks . I t also offers a d network optimiz a tion serv ices , a s well a s ad qua lity protection progra ms . In a ddition, the company prov ides solutions to s top unwa nted a ds in tra ck s by protecting W eb publis hers. T he compa ny was founded in 1998 a nd is ba sed in Los Angeles, Ca lifornia. T ripbas e U nited S ta tes www. tripba se. com Tripbas e is a tra vel webs ite that gives you unbiased recommenda tions a bout where to go o n y our next trip based on wha t y ou lik e. T ribal No va, In c. C a nada www. triba lnova. com/en/ Triba l Nov a , I nc. dev elops a nd ma rk ets Internet s ites , online ga mes , intera ctive televis ion programs , a nd cellula r telephony c ontent for children. It produc es a n arra y of ga mes ranging from educ a tiona l pres chooler online ga mes , s uch a s Ca i llou to multiplayer online role pla yi ng game for teens, suc h as Ma gi Na tion. The compa ny opera tes at the internationa l level in E urope and N orth America . T riba l Nova , Inc . wa s founded in 2004 a nd is ba s ed in Montrea l, Ca nad a. T ubeMogul, Inc. U nited S ta tes www. tubemogul. c om TubeM ogul, I nc. opera tes as a n online video ana lytics a nd dis tribution company worldwide. It focuses on prov iding v ideo publis hing tools . The c ompa ny provides a single point for deploy ing uploads to the video s haring s ites , a nd a nalytics on who, wha t, a nd how v ideos are being viewed. It serv es content produc ers, media companies , a d a ge ncies , digita l consulta nts, record la be ls, film s tudios , politicians , c onsumer products orga niz a tions , and corporations. The compa ny wa s founded in 2006 a nd is ba sed in B erkeley , C alifornia. Figure 24. Company Descriptions Source. Company reports, Capital IQ, Crunchbase
  • 20. Page 20 RELEVANT DISCLOSURES APPLICABLE TO: NONE LIST OF DISCLOSURE TERMS: 1. None applicable. ANALYST CERTIFICATION Each analyst of Research Capital Corporation whose name appears in this report hereby certifies that (i) the recommendations and opinions expressed in this research report accurately reflect the analyst’s personal views and (ii) no part of the research analyst’s compensation was or will be directly or indirectly related to the specific conclusions or recommendations expressed in this research report. I n f o r ma t i o n a b o u t Re s e a r ch C a p i t a l C o r p o r a t i o n ’ s Ra t i n g S y s t e m, t h e d i s t r i b u t i o n o f o u r r e s e a r ch t o cl i e n t s a n d t h e p e r ce n t a g e o f r e c o m me n d a t i o n s wh i c h a r e i n e a c h o f o u r r a t i n g c a t e g o r i e s i s a v a i l a b l e o n o u r we b si t e a t ww w. r e s e a r ch c a p i t a l . c o m. T h e i n f o r ma t i o n c o n t a i n e d i n t h i s r e p o r t h a s b e e n d r a wn f r o m s o u r c e s b e l i e ve d t o b e r e l i a b l e b u t i t s a c cu r a c y o r co mp l e t e n e ss i s n o t g u a r a n t e e d , n o r i n p r o vi d i n g i t d o e s R e s e a r c h Ca p i t a l C o r p o r a t i o n a s s u me a n y r e sp o n si b i l i t y o r l i a b i l i t y . R e s e a r ch C a p i t a l C o r p o r a t i o n , i t s d i r e ct o r s , o f f i c e r s a n d o t h e r e mp l o y e e s ma y , f r o m t i me t o t i me , h a v e p o si t i o n s i n t h e s e cu r i t i e s me n t i o n e d h e r e i n . Co n t e n t s o f t h i s r e p o r t c a n n o t b e r e p r o d u c e d i n wh o l e o r i n p a r t wi t h o u t t h e e xp r e ss e d p e r mi s si o n o f R e se a r ch C a p i t a l C o r p o r a t i o n . ( U . S . I n s t i t u t i o n a l Cl i e n t s — Re s e a r ch C a p i t a l U . S. A . I n c. ( a wh o l l y o wn e d s u b si d i a r y o f R e s e a r c h C a p i t a l Co r p o r a t i o n ) a cc e p t s r e s p o n si b i l i t y f o r t h e c o n t e n t s o f t h i s r e p o r t s u b je c t t o t h e t e r ms & l i mi t a t i o n s s e t o u t a b o v e . F i r ms o r i n s t i t u t i o n s r e ce i vi n g t h i s r e p o r t s h o u l d e f f e ct t r a n s a ct i o n s i n s e c u r i t i e s d i sc u s se d i n t h e r e p o r t t h r o u g h R e s e a r ch C a p i t a l U . S . A . I n c. , a B r o k e r - D e a l e r R e g i s t e r e d wi t h t h e U n i t e d S t a t e s S e cu r i t i e s a n d E xc h a n g e C o m mi s si o n ) . Tor on to 4 16. 8 60. 76 00 M ontr eal 51 4. 39 9. 150 0 V anco u ver 60 4. 66 2. 180 0 C al gar y 40 3. 26 5. 740 0 R egi na 306. 566. 7550 www.researchcapital.com