09 02 17 Web 2.0 Weekly
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Twitter raises $35m.

Twitter raises $35m.

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09 02 17 Web 2.0 Weekly Document Transcript

  • 1. SOFTWARE & SERVICES 17 FEBRUARY 2009 DAVID SHORE, CFA, MBA 416.860.6784 WEB 2.O WEEKLY david.shore@researchcapital.com Arun Thomas (Associate) 416.860.7666 NO REVENUE? NO PROBLEM T WIT T E R R AI S E S $ 35 MI L L IO N The largest W eb 2.0 financing of the last three months was for perhaps the hottest W eb 2.0 company on the planet – Twitter. On Friday, the company announced that it had closed on a new funding round of $35 million that rumour has it valued the company at approximately $230 million. This for a company with no revenue! However, Twitter has undergone tremendous growth over the last year. According to compete.com, Twitter had 6 million unique visitors as of January 2009, up an astounding 800% Y/Y, and moving ahead of social networks like Bebo (bought by AOL for $850 million). Overall, there have been 15 financings announced in February, totalling $89.0 million, or $5.9 million on average. The average value in February is below the $6.9 million average for January, with more early-stage financings announced in February relative to January – 64% of financings in February have been Series A rounds versus just 27% in January. Financing - Last Three Months 40.0 35.0 30.0 25.0 Feb-09 (US$m) 20.0 Jan-09 Dec-08 15.0 10.0 5.0 0.0 ChakPak Cake Financial Go Internet Media One True Media Pulse Entertainment DECA GoFish FooMojo JibJab Jackbe FetchDog RatePoint IMVU Tumblr TextDigger Play Hard Sports E-Global Sports Clickpass Geni Tvinci Overlay.TV Outbrain Nurien Taptu Tvtrip Social Median SocialMedia Oodle Tagged Playdo Mixpo 7 Billion People DotBlu Hubdub CoveritLive Identi.ca OneSpot Outright NetShelter SundaySky Fliqz Motionbox Gbox Meez Blue Kai Xobni AdMob Aster Data Scribd Snapmylife Snooth NewsGator VirtuOz Sportsblogs AboutUs WhistleBox StockTwits Yodle Superfish Angie's List fav.or.it Twitter Kewego Tripwolf InsideView This report has been created b y Anal ysts that are emplo yed b y Research Capital Corporation, a Canadian Investment Dealer. 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 86 public Web 2.0 companies identified: W e have identified 86 public companies for our W eb 2.0 universe, with a combined market cap of $30 billion. These include a wide variety of companies, including MMOG (Massive Multi-Player Online Gaming) companies, social networking software companies, media sharing companies, and social lending companies. See below for a summary of the full universe (Figure 1). The average market cap for the group is almost $350 million, with average trailing revenue of $130 million. The companies are also highly profitable, with an average EBITDA margin of 17.3%. On a valuation basis, the overall average is 4.3x trailing revenue and 8.7x trailing EBITDA. Fifteen of the companies have more than 500 employees. C omparable C ompany Analys is > Web 2.0 Trading C ur rent US D Mark et US D L T M T otal US D L TM Total E B ITDA T E V /L TM T E V /L TM C ompany Na me L T M as of Ti c ker E xc hange C urrenc y HQ Pr ic e C ap ($m) R ev ($m ) E B IT DA ($m ) % R evenue E B ITDA E mployees Acce lerize N ew Media, I nc. 9 /3 0/20 08 A C LZ OT CB B US D United S tates 0. 35 9. 4 3. 2 ( 4. 7) NM 4. 3 x - 20 Actoz S oft C o. , Ltd. 9 /3 0/20 08 A 05 279 0 K OS E KR W S outh K orea 12 ,7 00 7 8. 4 5 1. 2 9. 4 18 .3 % 1. 0 x 5 .7 x NA AQ Inte ractive, Inc. 1 2/31 /200 8 3 838 TS E JP Y J a pan 32 ,6 50 1 9. 3 6 5. 7 5. 3 8. 0% - - NA As s oci ated Me dia Holdings Inc. 6 /3 0/20 07 A S MH OT CP K US D United S tates 0. 01 0. 2 0. 1 ( 2. 3) NM 1 0. 2x - 3 B igs tring C orp. 9 /3 0/20 08 B SG C OT CB B US D United S tates 0. 02 0. 8 0. 1 ( 2. 1) NM 3 0. 7x - 8 B oomJ Inc 9 /3 0/20 08 B OMJ OT CB B US D United S tates 0. 70 2 8. 6 1. 1 ( 7. 7) NM 2 9. 1x - 25 B right T hi ngs plc 9 /3 0/20 08 A IM: B GT A IM G BP United K ingdom 0. 02 3. 5 0. 2 ( 1. 6) NM 1 4. 4x - 9 B roadW ebA s ia Inc. 9 /3 0/20 08 B W BA OT CP K US D United S tates 1. 50 127 . 3 0. 0 ( 4. 6) NM - - 46 C DC C orp. 9 /3 0/20 08 C HIN. A Na s daqG S US D Hong K ong 0. 88 9 4. 9 428 . 1 18 .8 4. 4% 0. 4 x 8 .1 x 3 ,1 25 C hina G ateway C orpora tion 9 /3 0/20 08 CG WY OT CB B US D United S tates 0. 00 0. 0 6. 7 ( 6. 6) -9 8. 9% 0. 0 x - 37 C hines e G amer International 9 /3 0/20 08 G T S M: 3 083 GTS M TWD T a iwan 11 4. 00 282 . 5 3 7. 5 17 .7 47 .1 % 6. 0 x 12. 8x NA C ornerW orld C orporation 1 0/31 /200 8 CW RL OT CB B US D United S tates 0. 15 7. 0 0. 6 3. 1 5 06. 8 % 1 3. 8x 2 .7 x NA DAD A S pA 9 /3 0/20 08 C M: DA CM E UR Italy 6. 26 129 . 7 216 . 7 34 .6 16 .0 % 0. 8 x 5 .0 x 5 74 Digi ta lF X Inte rnational, Inc. 9 /3 0/20 08 DX N OT CB B US D United S tates 0. 08 2. 0 1 6. 9 ( 4. 5) -2 6. 4% 0. 3 x - 68 Digi ta lP os t Inter active, Inc. 9 /3 0/20 08 DG LP OT CB B US D United S tates 0. 01 0. 9 0. 4 ( 3. 3) NM 4. 4 x - 11 Digi ta lT own, Inc. 1 1/30 /200 8 DG T W OT CB B US D United S tates 2. 00 5 4. 3 NM ( 2. 5) NM - - 3 Dolphin Digita l Me dia , Inc. NA DP DM OT CB B US D United S tates 0. 53 2 5. 8 NA NM NM - - 6 E olith C o. Ltd. 1 2/31 /200 7 A 04 106 0 K OS E KR W S outh K orea 5 90 1 9. 3 1 7. 5 ( 0. 0) -0 .3 % 1. 1 x - NA E xtensions, Inc. 9 /3 0/20 08 E XT I OT CP K US D United S tates 0. 20 1 8. 9 NM NM NM - - 2 F ina ncia l Me dia Group, I nc. 1 1/30 /200 8 F NG P OT CB B US D United S tates 0. 02 1. 0 6. 8 1. 2 18 .3 % 0. 0 x 0 .1 x 22 F luid Mus ic C anada , I nc. 9 /3 0/20 08 T S X: F MN TS X CAD United S tates 0. 60 2 5. 3 4. 2 ( 8. 6) NM 3. 2 x - 29 F rogs te r Inte ractive P icture s A G 6 /3 0/20 08 FRG XT R A E UR G ermany 4. 32 1 3. 0 5. 1 ( 3. 1) -6 0. 6% 2. 4 x - NA Ga mania Digital E nterta inme nt C o. , L td. 9 /3 0/20 08 6 180 GTS M TWD T a iwan 2 3. 40 103 . 6 108 . 4 18 .3 16 .9 % 0. 7 x 4 .3 x NA Ga meO n C o L td. 1 2/31 /200 8 3 812 TS E JP Y J a pan 1 14 ,0 00 120 . 1 8 1. 3 21 .5 26 .4 % 0. 7 x 2 .8 x NA Ge oS entric O yj 9 /3 0/20 08 G E O 1V HL S E E UR F inland 0. 04 4 5. 8 5. 2 (12 .1 ) NM 7. 7 x - 92 Giant Inte ractive G roup, Inc. 9 /3 0/20 08 GA NY S E US D C hina 6. 22 1, 478 . 5 245 . 5 1 55. 8 63 .5 % - - 1 ,0 16 GigaMe dia L td. 9 /3 0/20 08 G IG M Na s daqG S US D T a iwan 7. 38 398 . 7 200 . 5 48 .0 23 .9 % 1. 7 x 6 .9 x 9 75 GoF is h C orporation 9 /3 0/20 08 G OF H OT CB B US D United S tates 0. 20 5. 1 6. 3 (11 .0 ) NM 2. 5 x - 41 Gravity C o., Ltd 9 /3 0/20 08 GRVY Na s daqG M US D S outh K orea 0. 71 1 9. 7 3 4. 3 6. 6 19 .2 % - - 6 36 Gree, Inc. 6 /3 0/20 08 T S E : 3 632 TS E JP Y J a pan 5 ,3 60 1, 302 . 5 3 2. 0 11 .5 36 .0 % 4 0. 7x - NA GungHo Online E nte rtainme nt, Inc. 9 /3 0/20 08 3 765 OS E JP Y J a pan 98 ,6 00 122 . 8 111 . 3 16 .3 14 .7 % 0. 9 x 5 .9 x NA HanbitS oft, Inc. 9 /3 0/20 08 A 04 708 0 K OS E KR W S outh K orea 4 ,0 60 6 2. 3 4 8. 6 (12 .4 ) -2 5. 6% 0. 9 x - NA IA C /Inte rA ctive C orp. 1 2/31 /200 8 I AC I Na s daqG S US D United S tates 1 5. 05 2, 120 . 5 1 , 445 . 1 64 .6 4. 5% 0. 3 x 5 .7 x NA IA S E ne rgy, Inc. 1 0/31 /200 8 I AS C . A OT CB B US D C a na da 0. 03 1. 8 0. 0 ( 0. 9) NM - - NA IdeaE dge, Inc. 1 2/31 /200 8 O T C B B: ID AE OT CB B US D United S tates 0. 44 1 8. 6 0. 0 ( 4. 6) NM - - NA is ee media Inc. 9 /3 0/20 08 IEE T S XV CAD C a na da 0. 12 4. 9 1. 1 ( 4. 4) NM 2. 0 x - NA J umbuck E ntertainme nt P ty Ltd. 6 /3 0/20 08 A S X :J MB AS X A UD A us tra lia 0. 41 1 3. 2 1 0. 2 4. 7 46 .0 % 0. 9 x 1 .9 x 72 J umpT V I nc. 6 /3 0/20 08 T S X: J T V TS X CAD C a na da 0. 44 4 0. 2 1 1. 5 ( 1. 8) -1 5. 3% 4. 3 x - NA K a boos e Inc. 9 /3 0/20 08 T S X: K A B TS X CAD C a na da 0. 38 4 2. 8 5 9. 7 4. 5 7. 6% 0. 8 x 11. 0x NA K ings oft C o. Ltd. 9 /3 0/20 08 3 888 S EHK HK D C hina 2. 90 401 . 5 106 . 9 36 .1 33 .8 % 3. 0 x 8 .8 x 1 ,6 60 Lingo Me dia C orpora tion 9 /3 0/20 08 T S XV :L M T S XV CAD C a na da 0. 90 9. 3 3. 3 ( 1. 4) -4 2. 5% 3. 1 x - NA Live World Inc. 9 /3 0/20 08 L VW D OT CP K US D United S tates 0. 04 1. 2 1 1. 7 ( 1. 2) -1 0. 1% 0. 0 x - 73 LookS mart, Ltd. 9 /3 0/20 08 L OO K Na s daqG M US D United S tates 1. 37 2 3. 3 6 9. 5 ( 2. 6) -3 .7 % - - 93 Magnitude Informa tion S ys tems I nc. 9 /3 0/20 08 MA GY OT CB B US D United S tates 0. 03 1 0. 9 0. 1 ( 3. 2) NM - - 13 Mixi, Inc. 1 2/31 /200 8 2 121 TS E JP Y J a pan 4 13 ,0 00 688 . 7 127 . 8 48 .6 38 .0 % 4. 5 x 11. 8x NA Mode rn T imes Group Mtg A B 1 2/31 /200 8 MT G B OM SE K S weden 13 2. 00 1, 015 . 0 1 , 536 . 5 2 45. 7 16 .0 % 1. 0 x 6 .1 x NA Moggle , Inc 1 2/31 /200 8 MMO G OT CB B US D United S tates 2. 00 7 0. 6 NM ( 1. 1) NM - - 3 MOK O. mobi L imited 6 /3 0/20 08 MK B AS X A UD A us tra lia 0. 04 2. 1 1. 3 ( 2. 0) NM 0. 7 x - NA NE O W IZ G ame s C orpora tion 1 2/31 /200 7 A 09 566 0 K OS E KR W S outh K orea 33 ,6 50 226 . 2 126 . 3 33 .9 26 .9 % 1. 7 x 6 .4 x NA NetDra gon We bS oft, Inc. 9 /3 0/20 08 7 77 S EHK HK D C hina 2. 95 201 . 1 9 5. 4 46 .3 48 .6 % 0. 3 x 0 .5 x 1 ,4 82 Netea s e. com Inc. 9 /3 0/20 08 NT E S Na s daqG S US D C hina 1 9. 25 2, 368 . 8 423 . 1 2 74. 7 64 .9 % - - 2 ,4 13 NeXplore C orporation 9 /3 0/20 07 NX PC OT CP K US D United S tates 0. 79 4 4. 1 NM ( 4. 9) NM - - 19 Ngi G roup Inc. 1 2/31 /200 8 2 497 TS E JP Y J a pan 26 ,1 70 3 5. 2 107 . 1 33 .0 30 .8 % - - NA Northgate T e chnologies L imited 1 2/31 /200 8 5 900 57 BSE INR India 4 4. 30 3 1. 6 138 . 1 24 .3 17 .6 % 0. 2 x 1 .3 x 2 86 Open T e xt C orp. 1 2/31 /200 8 OTE X Na s daqG S US D C a na da 3 5. 55 1, 845 . 0 769 . 3 1 95. 0 25 .3 % 2. 6 x 10. 1x 3 ,4 00 Openwa ve S ys tems I nc. 1 2/31 /200 8 OPW V Na s daqG S US D United S tates 0. 89 7 4. 1 199 . 6 (10 .2 ) -5 .1 % - - 6 27 P e rfect W orld C o., Ltd. 9 /3 0/20 08 PWRD Na s daqG S US D C hina 1 4. 30 815 . 8 187 . 1 1 00. 0 53 .5 % - - 1 ,4 01 P hotoC hannel Ne tworks Inc. 9 /3 0/20 08 T S XV :P N T S XV CAD C a na da 1. 77 4 7. 6 1 3. 7 ( 2. 4) -1 7. 7% 3. 4 x - NA Quepas a C orp. 9 /3 0/20 08 QPS A Na s daqC M US D United S tates 1. 43 1 8. 1 0. 1 (11 .8 ) NM - - 63 OA O R B C Informa tion S ys tems 1 2/31 /200 7 R B CI RTS US D R us s ia 0. 30 4 1. 6 134 . 8 17 .6 13 .1 % 0. 0 x 0 .1 x NA S handa Intera ctive E nte rtainment L td. 9 /3 0/20 08 S NDA Na s daqG S US D C hina 3 0. 55 2, 119 . 6 478 . 5 2 28. 6 47 .8 % - - 2 ,5 64 S hutterfly, Inc. 1 2/31 /200 8 S F LY Na s daqG S US D United S tates 8. 49 213 . 4 213 . 5 29 .8 13 .9 % 0. 6 x 4 .2 x NA S K C ommunications C o. , Ltd. 1 2/31 /200 7 A 06 627 0 K OS E KR W S outh K orea 8 ,1 30 234 . 2 145 . 2 13 .7 9. 4% 1. 6 x 17. 1x NA S NA P Interactive, Inc. 9 /3 0/20 08 S TVI OT CB B US D United S tates 0. 99 1 0. 6 2. 3 0. 2 10 .1 % 4. 1 x 40. 7x 5 S NM G lobal Holdings 9 /3 0/20 08 S NMN OT CP K US D United S tates 0. 00 0. 0 2. 0 ( 0. 7) -3 4. 8% 1. 1 x - 33 S ocial Me dia V enure s , Inc. 1 2/31 /200 8 S MVI OT CP K US D United S tates 1. 42 0. 0 0. 1 ( 0. 1) -6 0. 5% 0. 1 x - NA S park Ne tworks , Inc. 9 /3 0/20 08 L OV A ME X US D United S tates 2. 55 5 4. 7 6 0. 1 11 .7 19 .5 % 0. 8 x 4 .3 x 1 76 S pectrumDNA, Inc. 9 /3 0/20 08 S PX A OT CB B US D United S tates 0. 10 4. 9 0. 1 ( 2. 7) NM - - 7 T encent Holdings Ltd. 9 /3 0/20 08 7 00 S EHK HK D C hina 4 8. 30 11 ,1 92 .8 904 . 8 4 48. 2 49 .5 % 1 3. 4x 27. 1x 6 ,0 39 T he P arent C ompany 8/2/2 008 K IDS . Q OT CP K US D United S tates 0. 03 0. 7 112 . 0 (13 .5 ) -1 2. 0% 0. 2 x - 3 47 T he 9 Limited 9 /3 0/20 08 NC T Y Na s daqG S US D C hina 1 4. 49 400 . 1 252 . 8 95 .2 37 .7 % - - 1 ,3 61 T he S tre et.com, Inc. 9 /3 0/20 08 TS CM Na s daqG M US D United S tates 2. 60 7 9. 3 7 5. 2 12 .2 16 .2 % 0. 0 x 0 .1 x 3 49 T ree . C om, Inc. 1 2/31 /200 8 TRE E Na s daqG M US D United S tates 3. 91 3 6. 6 228 . 6 (27 .0 ) -1 1. 8% 0. 2 x - NA Unis e rve C ommunications C or p. 1 1/30 /200 8 T S XV :U S S T S XV CAD C a na da 0. 08 1. 6 2 4. 0 0. 1 0. 4% 0. 2 x 36. 9x NA Unite d Online Inc. 9 /3 0/20 08 UNT D Na s daqG S US D United S tates 5. 19 425 . 4 538 . 7 1 30. 6 24 .2 % 1. 4 x 6 .0 x 9 28 UOMO Medi a, I nc 1 0/31 /200 8 UO MO OT CB B US D C a na da 0. 08 6. 8 0. 5 ( 0. 4) -9 1. 6% 1 5. 1x - NA V O IS , I nc. 9 /3 0/20 08 V OIS OT CB B US D United S tates 0. 75 5. 4 0. 0 ( 4. 0) NM - - 4 W ebzen Inc. 1 2/31 /200 8 W ZE N Na s daqG M US D S outh K orea 1. 50 1 7. 8 2 0. 0 ( 2. 0) -1 0. 1% - - 3 30 W izza rd S oftwa re C orporation 9 /3 0/20 08 W ZE A ME X US D United S tates 0. 73 3 3. 0 6. 2 ( 6. 5) NM 5. 3 x - 1 10 W oozyF ly, Inc. 9 /3 0/20 08 W ZYF OT CB B US D United S tates 0. 15 2. 6 0. 0 NM NM - - 14 W orlds .com Inc. 9 /3 0/20 08 W DDD OT CB B US D United S tates 0. 20 1 0. 5 0. 1 NM NM - - 1 W ynds torm C orporation NA W YN D OT CB B US D United S tates 0. 12 2. 2 NA NM NM - - NA XING A G 9 /3 0/20 08 O 1B C XT R A E UR G ermany 2 9. 75 197 . 8 4 0. 1 15 .6 38 .8 % 3. 6 x 9 .2 x 1 61 Y e dangO nline C orp. 1 2/31 /200 7 A 05 277 0 K OS E KR W S outh K orea 7 ,3 00 8 0. 0 4 8. 0 10 .7 22 .4 % 1. 7 x 7 .4 x NA Y nk K orea Inc. 1 2/31 /200 7 A 02 377 0 K OS E KR W S outh K orea 4 ,6 30 8. 0 1 3. 7 ( 1. 0) -7 .6 % 0. 6 x - NA ZipL ocal I nc. 9 /3 0/20 08 T S XV :ZIP T S XV CAD C a na da 0. 02 1. 3 2. 8 ( 3. 9) NM 0. 7 x - NA High 11 ,1 92 .8 1 ,5 36 .5 44 8. 2 5 06. 8 % 4 0. 7x 40. 7x 6, 03 9 Low 0. 0 0. 0 -2 7. 0 -9 8. 9% 0. 0 x 0 .1 x 1 Average 348.3 131.0 28.3 17.3% 4.3x 8.7x 604 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 ) Twitter raises $35 million: The largest W eb 2.0 financing of the last three months was for perhaps the hottest W eb 2.0 company on the planet – Twitter (Figure 2). On Friday, the company announced that it had closed on a new funding round of $35 million that rumour has it valued the company at approximately $230 million. This for a company with no revenue! However, Twitter has undergone tremendous growth over the last year. According to compete.com, Twitter had 6 million unique visitors as of January 2009, up an astounding 800% Y/Y, and moving ahead of social networks like Bebo (bought by AOL for $850 million) (Figure 3). Overall, there have been 15 financings announced in February, totalling $89.0 million, or $5.9 million on average. The average value in February is below the $6.9 million average for January with more early stage financings announced in February relative to January – 64% of financings in February have been Series A rounds versus just 27% in January. For additional details, see Figure 30 (at end of note). Financing - Last Three Months 40.0 35.0 30.0 25.0 Feb-09 (US$m) 20.0 Jan-09 Dec-08 15.0 10.0 5.0 0.0 Mixpo CoveritLive Motionbox IMVU InsideView TextDigger Overlay.TV Xobni AdMob Go Internet Media FooMojo Tvtrip One True Media Social Median Kewego SocialMedia Playdo SundaySky Gbox Meez Twitter NetShelter NewsGator Tripwolf fav.or.it Blue Kai Tvinci GoFish Yodle Outbrain Nurien Taptu Scribd JibJab Oodle Superfish Snapmylife Tagged Jackbe FetchDog 7 Billion People DotBlu Hubdub Snooth Identi.ca VirtuOz Play Hard Sports Fliqz Sportsblogs E-Global Sports StockTwits Clickpass Tumblr RatePoint DECA OneSpot Outright Angie's List Geni Cake Financial Aster Data Systems ChakPak AboutUs WhistleBox Pulse Entertainment Figure 2. Financings, Last Three Months Source. Company reports
  • 4. Page 4 Figure 3. Twitter vs. Bebo – Unique Visitors Source. www.compete.com Four aggregation companies raise $22.5 million (total): Activity in February has been busiest among aggregation companies (Figure 4). Four companies, Outbrain, Oodle, OneSpot and fav.or.it, have raised a total of $22.5 million. There have also been three video-related transactions, although the transactions were much smaller on average, with W histleBox, Tvinci, and Mixpo raising a total of $7.9 million. Financing by Sector - February 2009 40.0 35.0 30.0 25.0 (US$m) 20.0 35.0 15.0 22.5 10.0 5.0 9.0 7.9 5.3 4.3 3.0 2.0 0.0 Microblog Aggregation Travel Video Social Networks Search Analytics Financial Services 1 4 1 3 2 1 1 1 # companies Figure 4. Financings, by Sector, February 2009 Source. Company reports
  • 5. Page 5 Average round size increases slightly: On a trailing 12-month basis, total financing dollars inched up as of February 2009, with average round sizes increasing slightly as well (Figure 5). LTM Financing 4,000.0 20.0 18.0 3,500.0 16.0 3,000.0 14.0 2,500.0 12.0 (US$m) (US$m) 2,000.0 10.0 8.0 1,500.0 6.0 1,000.0 4.0 500.0 2.0 0.0 0.0 May-06 May-07 May-08 Nov-05 Mar-06 Nov-06 Mar-07 Nov-07 Mar-08 Nov-08 Jul-05 Sep-05 Jan-06 Jul-06 Sep-06 Jan-07 Jul-07 Sep-07 Jan-08 Jul-08 Sep-08 Jan-09 Total Average Figure 5. Financings, Last 12 Months Source. Company reports Cumulative total nears $5.4 billion: Overall, on a cumulative basis, W eb 2.0 financings have totalled nearly $5.4 billion, with the majority of the financing coming in late 2007 and the first three quarters of 2008 (Figure 6).
  • 6. Page 6 Web 2.0 Financing (cumulative) 1,400.0 6,000.0 1,313.3 1,200.0 5,000.0 1,000.0 944.7 4,000.0 800.0 (US$m) (US$m) 701.7 3,000.0 600.0 524.9 2,000.0 400.0 338.5 301.8 297.5 1,000.0 200.0 145.7133.0 135.6 97.0 87.2 74.4 37.5 33.5 18.2 41.9 49.1 29.4 35.5 28.8 20.1 0.0 0.0 Qtr4 Qtr1 Qtr2 Qtr3 Qtr4 Qtr1 Qtr2 Qtr3 Qtr4 Qtr1 Qtr2 Qtr3 Qtr4 Qtr1 Qtr2 Qtr3 Qtr4 Qtr1 Qtr2 Qtr3 Qtr4 Qtr1 2003 2004 2005 2006 2007 2008 2009 Figure 6. Financing, Cumulative Source. Company reports U.S. remains dominant: U.S. companies continue to dominate capital market activity – with almost 73% of financings/M&A involving U.S. companies (based on dollars) (Figure 7). Canadian companies generated under 1% of capital market activity based on dollar volume (Figure 6). Based on number of transactions, the U.S. leads with 73.6% of deals, while Canada is third in number of financings at 5.3% (Figure 8). Financing/M&A by Country - LTM ($) Financing/M&A by Country - LTM (#) Canada UK UK 5.3% Israel 5.3% 13.1% 4.1% France China 2.8% 8.0% Russia ROW 1.7% 8.9% Israel 1.0% Canada 0.7% France 0.7% ROW 2.0% USA USA 72.9% 73.6% Figures 7 & 8. Financing/M&A, by Country (LTM, $, #) Source. Company reports
  • 7. Page 7 Larger volume of early-stage funding (by count): Almost half of financings in the last 12 months are for early-stage companies (Angel/Seed or Series A) (Figure 9). Series B rounds are 28.4% of the total, with later-stage (Series D, E and PIPE) deals accounting for just 7.0%. Financing by Type - LTM Series B Series C 28.4% 14.0% Series D 4.4% Angel/Seed 9.6% Debt financing 2.6% Series A PIPE 38.9% 2.2% Figure 9. Financing, by Type (LTM, #) Source. Company reports “D” series remain largest equity rounds (by dollar): In the last 12 months, there have been 10 “D” series rounds, averaging $23.8 million per financing (Figure 10). Note that we have excluded the $430 million Series C financing of Oak Pacific Interactive as it skews the results substantially.
  • 8. Page 8 Average financing round size - LTM 45.0 40.0 35.0 30.0 25.0 (US$m) 41.9 20.0 15.0 23.8 10.0 18.4 11.3 5.0 10.0 8.8 5.8 3.5 0.0 Angel/Seed Debt financing PIPE Series A Series B Series C Series D Series E # rounds 22 6 5 89 65 32 10 1 Figure 10. Average Size per Round 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 ) Price Performance: Our W eb 2.0 index (market-cap weighted) has closely tracked the performance of the NASDAQ composite index, although it has outperformed the index since mid 2008 (Figure 11).
  • 9. Page 9 Web 2.0 Index Price Performance 140 120 100 80 60 40 20 0 2/19/2008 3/4/2008 3/18/2008 4/1/2008 4/15/2008 4/29/2008 5/13/2008 5/27/2008 6/10/2008 6/24/2008 7/8/2008 7/22/2008 8/5/2008 8/19/2008 9/2/2008 9/16/2008 9/30/2008 10/14/2008 10/28/2008 11/11/2008 11/25/2008 12/9/2008 12/23/2008 1/6/2009 1/20/2009 2/3/2009 NASDAQ COMP Web 2.0 (Market Cap Weighted) Figure 11. Web 2.0 Price Performance Source. Capital IQ DigitalTown leads; NGI falls: DigitalTown Inc. (DGTW -OTCBB) had the best performance in the group (for stocks with prices greater than $1) (Figure 12), increasing 33.3% on the week. Quepasa Corporation (QPSA-NasdaqCM) fell the most, -19.2%.
  • 10. Page 10 1 Week P rice P erformance DigitalTow n, Inc. 33.3% NEOWIZ G ames Corporation 30.1% Northgate Technologies Limited 19.0% Y nk K orea Inc. 14.0% HanbitS oft, Inc. 12.5% S park Netw orks , Inc. 10.9% Eolith Co. Ltd. 9.4% PhotoChannel Netw orks Inc. 8.6% A ctoz S oft Co., Ltd. 8.1% Tencent Holdings Ltd. 6.2% G amania Digita l Entertainment Co., 5.6% S ocial Media V enures , Inc. 5.2% Chines e G amer International 4.9% Y edangOnline Corp. 4.6% NetDragon WebS oft, Inc. 2.8% DA DA S pA 2.7% GigaMedia Ltd. 2.6% IA C/InterA ctiveCorp. 1.8% G iant Interactive G roup, Inc. 1.3% Webz en Inc. 0.7% A Q Interactive, Inc. 0.6% Tree.Com, Inc. 0.0% LookS mart, Ltd. 0.0% Open Tex t Corp. -0.6% S hutterfly , Inc. -1.3% K ings oft Co. Ltd. -1.3% S handa Interactive Entertainment -1.6% G ree, Inc. -1.8% The9 Limited -2.3% G ungHo Online Enterta inment, Inc. -4.3% X ING A G -5.0% S K Communications Co., Ltd. -5.1% Neteas e.com Inc. -6.3% Perf ect World Co., Ltd. -8.6% Modern Times Group Mtg A B -8.8% G ameOn Co Ltd. -8.9% Frogs ter Interactive Pictures A G -9.3% Mix i, Inc. -9.4% United Online Inc. -11.4% Ngi G roup Inc. -11.5% TheS treet.com, Inc. -11.6% Quepas a Corp. -19.2% -30.0% -20.0% -10.0% 0.0% 10.0% 20.0% 30.0% 40.0% Figure 12. 1-Week Price Performance Source. Capital IQ
  • 11. Page 11 INDUSTRY NEWS (PARTNERSHIPS, FINANCIAL RESULTS, NEW PRODUCTS) Key Developments Company Headline Notes T ree . C om, Inc. announc ed it ex pec ts to T ree . C om, Inc. (N as daqG M : T R E E ) a nnou nc ed a private plac ement o f 93 5, 00 0 c ommo n s hares a t $3 . 91 per s hare f or gros s proc eeds of T ree .C om, Inc. (Na s daqG M: T R E E ) rec eive $3. 65 million in fun ding. $ 3, 65 5,85 0 on F ebrua ry 8, 200 9. Do ug L ebda , C ha irman a nd C hief E xec utive O ffic er of the c ompa ny will inves t in the transa ction . NetDragon W ebS oft, Inc. (S E HK :777); N e tDrago n P artners with S aigonT e l to N etDrago n W ebS o ft Inc. announc ed tha t it ha s signe d an agree me nt with S aigon T elec ommunic ation & T e chnologies C orpo ra tio n to lic ens e L ic ens e Zero O nline in V ietnam Ze ro O nline in V ietnam ma rk et. Z ero O nline is the firs t 2 . 5D M MO R P G develo ped in C hina that is s et in a s cienc e-fic tio n univers e with robo t S aigon T ele communica tion & a vatars. It wa s well rec eive d by play ers both in C hina and ove rs ea s mark et sinc e its launc h in April 2007 . NetDra gon has already launched T echnologie s C or poration the E nglish and S panish ve rs ion o f Zero Online in E urop ean and Americ an ma rk ets, and the traditional C hines e ve rs ion in Ho ng K ong, (HO S E : S G T ) M ac ao, and T aiwa n. B roadW ebA sia Inc . announce d that it has B roadW ebA s ia Inc . ( O T C P K : B W B A) a nnou nc ed a private plac ement of 1 8% s ec ured co nve rtible pro mis so ry no te with Able I ncome F und, B r oa dW ebAs ia Inc. (O T C PK : B W B A) rec eive d $0 .15 millio n in fu nding. L LC fo r gros s proc eeds o f $1 50, 0 00 o n F ebrua ry 9, 200 9. T he no te h as a c onvers io n price of $ 0.50 per s ha re . T he c ompany promis es to pa y to the ho lde r $150 ,000 in c as h on May 10 , 20 09. The de benture be ars interes t at the ra te o f 18 % per a nnum u ntil the matu rity date. T he c ompa ny will a ls o is su e a warra nt fo r the purc has e o f up to 5 0,00 0 s hares o f the c ompany ’s co mmon stoc k at an ex ercis e price of $0. 7 5 pe r s ha re . T he warra nts are exerc is able , in whole o r in part, any time from and afte r the date of is s uanc e of the warrant for a perio d of five ye ars . O pe n T ex t C o rp. T eams Up with F us e Digital O pe n T ex t C o rp. announce d that it ha s teamed up with F us e Digital to deliver the la tes t web s olu tio ns to F us e c lient the G S MA . The G S MA O pen T ext C or p. (Nas daqG S : O T E X ) to Deliver the La tes t W eb S olutions to F us e a pproac he d F us e Digital, o ne o f the UK 's leading digita l mark eting agencies , to improve its pu blic image online a nd move to a more sc alable C lient the G S MA a nd func tional website. P revious ly the G S M A site was hard to mana ge, it wa s re liant on c ode and ex porting co ntent which was ineff ic ie nt a nd time c onsu ming. T he G S MA wanted F us e to pro vide the c reative inpu t s urro unding the site and foc us on the brand and online ima ge. F u se s elec ted the O pen T ext W eb S olution to deliver the func tiona lity behind the s ce nes . Du e to the natu re of the site and the e nterprise le ve l f eatu re s the G S MA requ ired, F us e look ed to O pe n T ex t, to de live r the high le ve l f ra mewo rk required . O pen T ext W eb S o lutions enabled the G S MA to tak e c omplete co ntrol of all online o utpu t and mes s aging, whic h in turn s treamline d work flow proc es s es , and inc re as ed e fficienc y , pro duc tivity and va lue for mone y. F urthermore, the n ew fu nc tio nality will ena ble the organis ation to deliver c ontent in a va riety of la ngua ges to a wo rldwide a udienc e. T his wa s critic al to the organis ation as it has o ver 7 50 G S M mobile pho ne o perato rs a nd o ver 2 00 manufac turers and s upp W iz zard Media a nd A ttentionS pan Media W iz za rd Media, a divis io n of W izz ard S oftwa re , ha s signe d an agree me nt with A tte ntion S pa n Me dia , LL C to dis tribute the s tudio's 'S oc k Attention S pan Media , L L C ; W izzard S ign Dis tribu tio n A greement T u be P res ents ' original video c on tent for do wnlo ad to pe rs onal mobile d evic es , c ompute rs a nd via A pple's iT unes s ervic e a nd M ic ros oft' s S oftwar e C or poration (AME X: W ZE ) Zu ne M arke tplac e. Do pod Inte rnational C o rp. Ltd. and is eemedia I nc . and Dopod I nterna tio nal C orp. Ltd. have e ntered into a n ag re eme nt that will s ee is ee me dia 's is ee doc s (T M ) E mail a ttac hment is eemedia Inc. (TS X V: IE E ) is eemedia I nc . A gree to P re -ins tall Is eedo cs s olution pre-ins ta lled o n hu ndreds o f thous ands of Do pod W indows Mo bile devic es in S pring 200 9. T he Dopod a greement in unis on with o n S ma rtphones T hroughout C hina is eemedia's rec ent agree me nt with H os t C hina Mobile ( Hos tC HN ) is intended to promote the us e o f ise edoc s , by giving S ma rtphone us ers immedia te and ea sy a cc es s to the tec hno logy with the clic k of an ic on on the hands et. X ING A G Ann ounc es E arnings R e su lts for X ING A G anno unc ed earnings res ults for the y ear 2 008. T he c ompa ny re ported reve nues inc reas ed by 80% to € 35. 3 million c ompared to X ING A G (X T R A: O 1B C ) the Y ear 2 008 € 19. 6 million. T he C o mpany also increa se d its ope ra tio nal res ult ( E B IT DA ) by mo re tha n 85 % . T he E B IT DA ( adjus ted for no n rec urring e xpe ns es res ulting from disc ontinued M& A pro ce ss es totaling €0 . 77 millio n) the re fore ros e by 86% to €1 2. 82 million in the 2 008 financ ia l y ear c ompa re d to €6.8 9 million for the s ame pe riod la st ye ar. P erfec t W orld Announce s C lo se B e ta T e st P erfect W orld C o. Ltd. announc ed on that its multimedia online role-pla ying game, ' K ou daixiyo u', o r E therS a ge O nlin e, h as s tarted clos e P erfec t W or ld C o., L td. f or 'K ouda ix iy ou' in North A meric a beta tes t in No rth A me ric a. (Nas da qGS : PW R D) S handa to C o llaborate with S torm S ha nda Interac tive E nterta inment Ltd. ha s re ached an a greement with Ac c es s C hina H olding Ltd. on c oope ra tio n in operating o ne o f the Acces s C hina Holding L td.; S handa E nte rtainme nt o n G ame O peration latter's online ga me s. S handa will adopt th e s ame mode as is u se d in its c ollaboration with K ings oft C orp. in operating the game, but Interactive E nterta inment L td. dec lined to dis c lo se mo re details on the co operation. (Nas da qGS : S N DA) M odern T imes G ro up M tg A B R eports M odern T imes G roup Mtg AB reporte d ea rn ings re su lts f or the full y ea r o f 20 08. F or the ye ar, the company po sted a n op erating pro fit of S E K Modern T ime s G roup Mtg AB E arnings R e su lts f or the F ull Y ear of 200 8 ; 3 , 671 million, as c ompared to S E K 2, 027 millio n in 20 07. G rou p ne t s ales amounted to S E K 13 ,166 million, up by 1 6% fro m S E K 1 1,35 1 (O M: MT G B ) A nno unc es No n-C as h A s se t Impairme nt million in 200 7. E arnings per share ended at S E K 4 3.36 , up from S E K 20. 35. B oth s ales and earnings rea ched a n all time high. T he C harge c ompa ny anno unc ed non-c as h a ss et impa irme nt c ha rg e of S E K 76 millio n relating to MT G 's O nline bu sines s area . DigitalF X Internation al, Inc . has file d a S he lf D igitalF X In ternational, Inc . has file d a S he lf R egis tration in the a mou nt o f $0 . 42 millio n. Digi ta lF X Inte rnational, Inc. R e gistration in the amount of $0.4 2 million. (AME X: DX N) T o ys quot;R quot;Us , I nc . ac qu ired T o ys quot;R quot;Us , I nc . ac qu ired B a byUnivers e.c om, eT o ys . c om and eP regna nc y. c om o f T he P a re nt C o mpa ny on Fe bruary 12, 2009 . T he financ ial T he P are nt C ompany B aby Universe .c om, eT oy s . c om and terms of the dea l we re not disc los ed. T he P arent C ompany f iled for bankruptcy p ro tectio n in De ce mber, 200 8. T o ys quot;R quot;Us , I nc . c ompleted (O TC P K : K ID S .Q ); T he P are nt e P regnanc y .c om of T he P arent C ompany . the a cquis itio n of B a by U nivers e. c om, e T oys .c om and eP regnanc y. co m of T he P a re nt C ompany on F ebruary 12, 200 9. C ompany, B abyUnivers e. com, eP re gna ncy.com a nd eT oys .com; T oys quot;R quot; Us Inc. W e bz en I nc . R eports E a rnings R es ults for W ebz en I nc . repo rte d ea rnings re su lts for the fou rth qua rter and full yea r 2008 . F or the qu arter, the c ompan y reported net los s of K R W 2, 0 19 W ebzen Inc. (K O S E : A069080) the F ou rth Q uarte r and F ull Y ear 20 08 million on re venue o f K R W 7 ,211 million a gains t ne t inco me of K R W 2, 07 3 million on revenu e of K R W 6,9 64 millio n a y ea r ago. F or the ye ar, the c ompa ny re ported net los s of K R W 14 , 266 million on revenue of K R W 28,4 81 million aga ins t net los s of K R W 9,5 36 million on re venue o f K R W 28 , 216 million a ye ar ago . Figure 13. Key Developments Source. Capital IQ
  • 12. Page 12 VALUATION MMOG companies lead market cap charts: Eight companies in our Web 2.0 universe top US$1 billion in market capitalization (Figure 14). Sixty-one of the 80 (up from 58 last week) companies have market caps under US$100 million, with 26 (vs. 22 last week) under $10 million. Online gaming companies dominate the top of the list with four of the top six by market cap. Market C ap (US D m) Tencent Holdings Ltd. Neteas e.c om Inc. 2368. 8 IA C/InterA c tiveCorp. 2120.5 S handa Interac tive Entertainment Ltd. 2119.6 Open Tex t Corp. 1845.0 G iant Interactive G roup, Inc. 1478. 5 Gree, Inc. 1302.5 Modern Times Group Mtg A B 1015.0 Perfec t World Co., Ltd. 815.8 Mix i, Inc. 688.7 United Online Inc. 425. 4 K ings of t Co. Ltd. 401.5 The9 L imited 400.1 G igaMedia Ltd. 398.7 Chines e Gamer International 282.5 S K Communic ations Co., Ltd. 234. 2 NEOWIZ Games Corporation 226.2 S hutterf ly , Inc. 213.4 NetDragon WebS of t, Inc. 201. 1 XING A G 197. 8 DA DA S pA 129. 7 B roadWebA s ia Inc. 127. 3 122.8 GungHo Online Entertainment, Inc. GameOn Co Ltd. 120.1 Gamania Digital Entertainment Co., 103.6 CDC Corp. 94.9 80.0 Y edangOnline Corp. TheS treet. com, Inc. 79.3 A c toz S oft Co., Ltd. 78.4 Openw ave S y s tems Inc. 74. 1 70. 6 Moggle, Inc HanbitS of t, Inc. 62. 3 S park Netw orks , Inc. 54.7 DigitalTow n, Inc. 54.3 47. 6 PhotoChannel Netw orks Inc. G eoS entric Oy j 45. 8 NeXplore Corporation 44. 1 K aboos e Inc. 42.8 41.6 OA O R B C Inf ormation S y s tems J umpTV Inc. 40.2 Tree.Com, Inc. 36.6 Ngi Group Inc. 35.2 33.0 Wiz z ard S of tw are Corporation Northgate Technologies L imited 31.6 B oomJ Inc 28.6 Dolphin Digital Media, Inc. 25.8 Fluid Mus ic Canada, Inc. 25.3 LookS mart, Ltd. 23.3 Gravity Co., L td 19.7 A Q Interac tive, Inc. 19.3 Eolith Co. Ltd. 19.3 Ex tens ions , Inc. 18.9 IdeaEdge, Inc. 18.6 Quepas a Corp. 18.1 Webz en Inc. 17.8 J umbuck Entertainment Pty Ltd. 13. 2 Frogs ter Interactive Pictures A G 13. 0 Magnitude Inf ormation S y s tems Inc. 10. 9 S NA P Interac tive, Inc. 10. 6 Worlds .c om Inc. 10. 5 A c celeriz e New Media, Inc. 9.4 L ingo Media Corporation 9.3 Y nk K orea Inc. 8.0 CornerWorld Corporation 7.0 UOMO Media, Inc 6.8 V OIS , Inc. 5.4 GoFis h Corporation 5.1 4.9 is eemedia Inc. S pec trumDNA , Inc. 4.9 B right Things plc 3.5 Wooz yFly , Inc. 2.6 2.2 Wynds torm Corporation MOK O.mobi L imited 2.1 DigitalFX International, Inc. 2.0 IA S Energy , Inc. 1.8 1.6 Unis erve Communic ations Corp. ZipL ocal Inc. 1.3 LiveWorld Inc. 1.2 Financ ial Media G roup, Inc. 1.0 0.9 DigitalPos t Interac tive, Inc. B igs tring Corp. 0.8 The Parent Company 0.7 A s s oc iated Media Holdings Inc. 0.2 0.0 China Gatew ay Corporation S ocial Media V enures , Inc. 0.0 S NM G lobal Holdings 0.0 0 500 1, 000 1, 500 2, 000 2,500 3,000 3, 500 4,000 Figure 14. Market Cap Ranking Source. Capital IQ
  • 13. Page 13 TEV/Revenue (LTM) averages 4.1x: The overall average TEV/Revenue (LTM) multiple for our group is 4.3x – up from 4.1x last week (Figure 15). However, this is skewed by Gree (3633-TSE) at 40.7x, Bigstring (BSGC-OTCBB) at 30.7x, and BoomJ at 29.1x (BOMJ-OTCBB). Excluding those companies, the average is 2.8x (2.9x last week). Note that we exclude multiples greater than 50x. Thirty-one of the companies have multiples under 1.5x. T E V/L T M R evenue (x) 45. 0 40.7 40. 0 35. 0 30.7 29. 1 30. 0 25. 0 20. 0 15.1 1 14.4 13. 4 3.8 15. 0 10.2 10. 0 7.7 5.3 6.0 A vera ge, 4.3 4.4 4.5 3.43.6 4.1 4.3 4.3 2. 4 2.52.6 3.03. 1 3.2 5. 0 1.4 1.6 1. 71.7 1.7 2.0 1.0 1.01. 1 1.1 0.0 0.0 0.1 0.20.2 0.20.2 0.3 0.30.3 0.4 0.6 0.6 0. 70.7 0.70.7 0. 80.8 0.8 0.90. 9 0.9 0. 0 NE O WIZ G ames C orporation MO K O .mobi L imited UO MO Media, Inc G a mania Digital E ntertainment C o., G ungHo O nline E ntertainment, Inc. J umbuck E nterta inment P ty Ltd. C hines e G amer Interna tional U nis erve C ommunications C orp. N orthgate T echnologies L imited G oF is h C orporation T ree.C om, Inc. DigitalF X Interna tiona l, Inc. C DC C orp. G a meO n C o Ltd. S K C ommunica tions C o., Ltd. F luid Mus ic C a nada , Inc. DigitalP os t Intera ctive, Inc. T he P a rent C ompany Modern T imes G roup Mtg AB G eoS entric O y j S N M G loba l Holdings Lingo Media C orporation C ornerWorld C orporation B oomJ Inc T heS treet.com, Inc . United O nline Inc . O pen T ex t C orp. P hotoC hannel Network s Inc . S NAP Intera ctive, Inc . J umpT V Inc . IAC /InterAc tiveC orp. NetDra gon WebS oft, Inc . S pa rk N etwork s , Inc . E olith C o. Ltd. G igaMedia Ltd. is eemedia Inc . F rogs ter Intera ctiv e P ic tures AG Mix i, Inc . As s ociated Media Holdings Inc . T encent Holdings Ltd. G ree, Inc . XIN G AG B right T hings plc L iveWorld Inc . S ocial Media V enures , Inc . Y nk K orea Inc . ZipLoca l Inc . K aboos e Inc . H anbitS oft, Inc . Y edangO nline C orp. B igs tring C orp. S hutterfly , Inc . K ings oft C o. Ltd. Acceleriz e New Media , Inc . DADA S pA Ac toz S oft C o. , Ltd. Wiz z ard S oftware C orporation Figure 15. 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 16 shows the average TEV/Revenue multiples by stock exchange. The OTCBB has the largest number of companies (22), trading at an average multiple of 9.5 (down from 10.6x last week). On a geographic basis, the United States has the most companies (39), trading at an average of 4.9x revenue (unchanged from last week) (Figure 17). Ten of the companies are Canadian (average 3.6x revenue). Average TEV/LTM Revenue - By Exchange Average TEV/LTM Revenue - By Country 16.0 18.0 14.4 15.3 16.0 14.0 14.4 14.0 12.0 12.0 11.7 9.5 10.0 10.0 (x) 7.7 8.0 (x) 8.0 7.7 5.6 6.0 3.4 5.6 6.0 3.1 3.0 2.8 2.3 4.9 4.0 1.9 1.2 1.1 1.0 0.9 0.8 0.8 0.2 3.6 2.0 3.0 2.8 0.1 0.0 4.0 0.0 1.2 2.0 1.0 0.8 0.8 OTCPK 0.4 OTCBB GTSM NasdaqGM TSE HLSE SEHK KOSE NasdaqGS OSE RTS OM CM AMEX XTRA TSX BSE AIM TSXV ASX 0.2 0.0 0.0 Germany Kingdom Japan Finland China United Canada Hong India Russia Italy South Korea Kong States Taiwan Australia Sweden United 5 1 22 1 3 2 2 2 3 8 5 7 11 1 1 1 2 1 5 1 # Companies 1 6 1 8 39 10 2 3 9 1 1 2 1 1 1 # Companies Figures 16 & 17. TEV/Revenue Ranking (Exchange, Country) Source. Capital IQ
  • 14. Page 14 TEV/EBITDA (LTM) averages 9.4x: The average multiple for the 31 companies with positive EBITDA (and multiples under 100x) is 8.7x LTM EBITDA (9.4x last week), led by SNAP Interactive’s (STVI-OTCBB) 40.7x multiple (Figure 18). Nineteen of the companies have EBITDA multiples under 7x. T E V/L T M E B IT DA (x) 45. 0 40. 7 40. 0 36. 9 35. 0 30. 0 27. 1 25. 0 20. 0 17. 1 15. 0 12. 8 11. 8 10. 1 11. 0 A verage, 8.7 9. 2 8. 8 8. 1 10. 0 7. 4 6. 9 6. 4 6. 1 5. 9 6. 0 5. 7 5. 7 5.0 4.3 4.3 4.2 5. 0 2.7 2.8 1.9 1. 3 0. 5 0. 1 0. 1 0. 0 0. 0 0. 0 0. 1 0. 0 NE O WIZ G ames C orporation J umbuck E ntertainment P ty Ltd. G amania Digital E ntertainment C o. , Ltd. G ungH o O nline E ntertainment, Inc . C hines e G amer International U nis erve C ommunic ations C orp. #NUM! #NUM! #NUM! O AO R B C Information S y s tems Northgate T ec hnologies L imited F inanc ial Media G roup, Inc . G ameO n C o L td. C DC C orp. S K C ommunic ations C o. , L td. Modern T imes G roup Mtg AB T heS treet. c om, Inc . U nited O nline Inc . O pen T ex t C orp. S NAP Interac tive, Inc . C ornerWorld C orporation NetDragon WebS oft, Inc . S park Network s , Inc . IAC /InterAc tiveC orp. G igaMedia L td. Mix i, Inc . T enc ent Holdings L td. XING AG Y edangO nline C orp. K aboos e Inc. S hutterfly , Inc. K ings oft C o. L td. DADA S pA Actoz S oft C o. , L td. Figure 18. TEV/EBITDA Ranking Source. Capital IQ TEV/EBITDA (LTM) by country/exchange: Figure 19 shows the average TEV/EBITDA multiples by stock exchange. The OTCBB has the largest number of companies (22), trading at an average multiple of 14.5x, while companies on the TSXV have the highest multiples (36.9x). On a geographic basis, the United States has the most companies (39), trading at an average of 8.0x EBITDA (Figure 20). Ten of the companies are Canadian (average 19.3x EBITDA). Average TEV/LTM EBITDA - By Exchange Average TEV/LTM EBITDA - By Country 40.0 36.9 25.0 35.0 19.3 30.0 20.0 25.0 (x) 15.0 20.0 12.1 14.5 12.1 (x) 15.0 11.0 9.2 9.2 8.6 7.3 9.2 9.2 6.8 6.1 10.0 8.1 10.0 8.0 8.0 5.9 5.0 4.3 6.8 6.1 1.9 1.3 5.0 0.1 0.1 5.0 5.0 0.0 1.9 OTCBB GTSM NasdaqGM SEHK KOSE TSE NasdaqGS OSE RTS OM CM TSX XTRA AMEX BSE TSXV ASX 0.1 1.3 0.0 Germany Canada China Hong United Japan India Russia Italy South Korea Kong States Taiwan Australia Sweden # Companies 5 22 3 3 2 7 2 5 11 1 1 1 2 2 1 5 1 # Companies 10 8 2 9 1 3 39 6 1 1 2 1 1 Figures 19 & 20. TEV/EBITDA Ranking (Exchange, Country) Source. Capital IQ P/E (LTM) averages 13.8x: The average multiple for the 31 companies with positive earnings (and multiples under 100x) is 13.8x LTM EPS (down from 14.2x LTM EPS), led again by SNAP Interactive’s (STVI-OTCBB) 58.5x multiple (Figure 21). Sixteen of the companies have P/E multiples under 10x.
  • 15. Page 15 P /E L T M (x) 70.0 58.5 60.0 48.0 50.0 36.6 37.7 40.0 31.9 30.0 19.7 15.7 15.8 17.3 20.0 A verage, 13.8 13.3 13.4 11.5 11.7 11.8 12.0 9.6 9.7 7.3 8.0 10.0 5.5 5.7 6.5 3.4 3.8 1.8 1.9 2.0 3.0 0.0 0.0 0.0 0.0 1.0 1.3 1.4 0.0 NE O W IZ G ames C orporation J umbuck E ntertainment P ty Ltd. G amania Digital E ntertainment C o., Ltd. C hines e G amer International #NUM! #NUM! #NUM! #NUM! Northgate T echnologies Limited G iant Interactive G roup, Inc. G ameO n C o Ltd. Modern T imes G roup Mtg AB T he9 Limited Neteas e.com Inc. S handa Interactive E ntertainment Ltd. United O nline Inc. Ngi G roup Inc. T heS treet.com, Inc. O pen T ex t C orp. S NAP Interactive, Inc. Look S mart, Ltd. Worlds .com Inc. S park Network s , Inc. NetDragon W ebS oft, Inc. G igaMedia Ltd. IAC /InterActiveC orp. Mix i, Inc. T encent H oldings Ltd. XING AG P erfect World C o., Ltd. Y edangO nline C orp. K ings oft C o. Ltd. S hutterfly , Inc. DADA S pA Actoz S oft C o., Ltd. Figure 21. P/E Ranking Source. Capital IQ P/E (LTM) by country/exchange: Figure 22 shows the average P/E multiples by stock exchange. The OTCBB has the largest number of companies (22), trading at an average multiple of 31.2x. On a geographic basis, the United States has the most companies (39), trading at an average of 19.4x earnings (Figure 23). Ten of the companies are Canadian (average 37.7x EPS). Average P/E - By Exchange Average P/E - By Country 40.0 35.0 37.7 31.2 30.0 35.0 25.0 30.0 19.7 18.1 20.0 17.7 25.0 (x) 14.6 14.0 19.7 19.4 15.0 17.7 (x) 12.9 20.0 13.7 10.0 8.4 8.0 7.3 12.9 15.0 5.5 3.0 5.0 2.0 7.7 8.0 10.0 1.4 7.3 3.0 0.0 5.0 OTCBB GTSM NasdaqGM 2.0 SEHK TSE NasdaqGS KOSE CM OM XTRA AMEX BSE NYSE ASX 0.0 Germany Canada United Japan China India Italy South Korea States Taiwan Australia Sweden 22 2 3 5 2 11 7 5 1 2 2 1 1 1 # Companies 10 2 39 6 3 9 1 8 2 1 1 # Companies Figures 22 & 23. P/E Ranking (Exchange, Country) Source. Capital IQ
  • 16. Page 16 UPCOMING EVENTS Upc oming E vents E vent Date L oca tion Webs ite W eb 2. 0 C anadian L eade rs hip S erie s - Ga ming Ma rch 3 T oronto h ttp: //web2le aders hips eries . iglooev ents . net/ E ngage! E xpo Ma rch 10-11 New Y ork www. enga geex po. co m Me sh 200 9 A pril 7-8 T oronto www. mes hconferenc e. com Figure 24. Upcoming Events Source. Company reports E arnings C alendar C ompany Date & Time Quarter C onf C all Deta ils T heS tree t. com, In c. (N as daqG M: T S C M ) T hurs day, F ebru ary 1 9, 2 009 4: 30 P M (E S T ) Q4 200 8 N /A United O nline Inc . ( Na sd aqG S : UNT D) T hurs day, F ebru ary 1 9, 2 009 5: 00 P M (E S T ) Q4 200 8 8 88-587 -0 611 T he9 L imited (Nas daq GS : NC T Y ) Mond ay , F ebrua ry 23 , 20 09 8 : 00 P M (E S T ) Q4 200 8 1 -8 66-543 -6 405 P hotoC han nel Network s In c. (T S XV : P N) W edn es day , F ebru ary 2 5, 2 009 4: 30 P M ( E S T ) Q1 200 9 8 88-300 -0 053 Neteas e. com In c. ( Nas daq GS : NT E S ) W edn es day , F ebru ary 2 5, 2 009 8: 00 P M ( E S T ) Q4 200 8 8 00-218 -0 713 S hand a Interac tive E n tertainment L td. (N as daqG S : S NDA) T hurs day, F ebru ary 2 6, 2 009 8: 00 AM (E S T ) Q4 200 8 1 -8 66-383 -7 989 P erfec t W o rld C o. , L td. (Na sdaqG S :P W R D) Mond ay , Ma rc h 02, 2 009 8: 00 A M (E S T ) Q4 200 8 1 -8 66-519 -4 004 Figure 25. Earnings Calendar Source. Company reports
  • 17. Page 17 C omparable C ompany Analys is > W eb 2.0 P ric e P erforma nc e C ompany Name C urrenc y Tic ker E xchange US D Market C ap ($m) C urrent Price 1 Wk 1 Mth 3 Mth 6 Mth 1 Yr 52 W eek Acce lerize N ew Medi a, Inc. US D AC L Z OTC BB 9. 4 0 .3 5 -12. 5% -1 2. 5% -36. 4 % -5 3. 3% NM -56 . 3% Actoz S oft C o. , Ltd. KRW A0 52790 K OS E 7 8. 4 1 2, 70 0 4 .5 % 23. 9% 41 . 6% 30 .9% 44. 3% -9. 9% AQ Inte ractive, Inc. J PY 383 8 TS E 1 9. 3 3 2, 65 0 -1. 4% 15. 4% -4 .0 % -7 6. 7% -8 8. 0% -90 . 5% As s oci ated Me dia Holdings Inc. US D AS MH OTCPK 0. 2 0 .0 1 -50. 0% -3 7. 5% -37. 5 % NM -8 7. 5% -93 . 8% B igs tring C orp. US D B S GC OTC BB 0. 8 0 .0 2 -8. 6% -5. 9% -36. 0 % -8 0. 0% -9 2. 4% -93 . 2% B oomJ Inc US D B O MJ OTC BB 2 8. 6 0 .7 0 -12. 5% -3 0. 7% -39. 1 % -7 7. 8% -4 4. 9% -78 . 8% B right T hings plc G BP AIM:B G T AIM 3. 5 0 .0 2 -3. 6% 27. 5% 90 . 0% 8. 6% -3 8. 7% -55 . 3% B roadW ebAs ia Inc. US D BW B A OTCPK 127 . 3 1 .5 0 48. 5% 17 2. 7% 11 . 1% 30 .4% NM -50 . 0% C DC C orp. US D C HIN. A Na sdaqGS 9 4. 9 0 .8 8 2 .3 % -1 2. 9% -10. 2 % -6 8. 5% -7 7. 1% -79 . 0% C hina G ateway C orpora tion US D C GW Y OTC BB 0. 0 0 .0 0 -33. 3% -3 3. 3% -80. 0 % -9 4. 4% -9 9. 7% -99 . 7% C hines e G amer International TW D GT S M: 308 3 G TSM 282 . 5 1 14 .0 0 2 .7 % 24. 6% 59 . 0% 36 .9% 21. 9% -8. 1% C ornerW orld C orporation US D CW R L OTC BB 7. 0 0 .1 5 -63. 4% -4 0. 0% -25. 0 % -7 6. 9% -8 9. 3% -89 . 7% DAD A S pA E UR C M:DA CM 129 . 7 6 .2 6 1 .1 % -8. 6% -3 .8 % -4 7. 0% -5 5. 1% -61 . 3% Digita lF X Inte rnational, Inc. US D DXN OTC BB 2. 0 0 .0 8 -42. 9% -3 4. 7% -68. 0 % -8 3. 7% -9 2. 4% -93 . 8% Digita lP os t Interactive, Inc. US D DGL P OTC BB 0. 9 0 .0 1 30. 0% -4 8. 0% -67. 5 % -8 1. 4% -9 5. 7% -96 . 1% Digita lT own, Inc. US D DGT W OTC BB 5 4. 3 2 .0 0 33. 3% -3 3. 3% 0. 0% -5 2. 9% -4. 8% -67 . 2% Dolphin Digita l Media , I nc. US D DP DM OTC BB 2 5. 8 0 .5 3 -11. 7% -1 8. 5% -41. 1 % NM NM -53 . 1% E olith C o. Ltd. KRW A0 41060 K OS E 1 9. 3 59 0 -2. 5% 9 .3 % 11 . 3% -2 2. 4% -6 8. 7% -71 . 5% E xtensions, Inc. US D E XT I OTCPK 1 8. 9 0 .2 0 33. 3% -8 0. 2% 1 00.0% NM 33. 3% -80 . 2% F ina ncia l Me dia Group, Inc. US D F NGP OTC BB 1. 0 0 .0 2 36. 4% -6 6. 7% -92. 5 % -9 8. 0% -9 2. 5% -98 . 5% F luid Mus ic C anada , Inc. C AD T S X :F MN TS X 2 5. 3 0 .6 0 7 .1 % 93. 5% 57 . 9% -5 8. 9% NM -70 . 6% F rogs te r Inte ractive P icture s A G E UR FR G XT R A 1 3. 0 4 .3 2 -7. 7% -1 6. 9% 3. 3% -3 8. 3% -1 6. 8% -43 . 5% Ga mania Digital E nterta inme nt C o. , L td. TW D 618 0 G TSM 103 . 6 23 .4 0 6 .4 % 6 .4 % 91 . 0% -7.5% -1 2. 4% -36 . 7% Ga meO n C o L td. J PY 381 2 TS E 120 . 1 11 4, 00 0 -4. 8% 0 .9 % -10. 2 % 1. 8% -1 1. 6% -30 . 3% Ge oS entric O yj E UR GE O1V HL S E 4 5. 8 0 .0 4 0 .0 % 0 .0 % 0. 0% -4 2. 9% -5 5. 6% -55 . 6% Giant Inte ractive G roup, Inc. US D GA NY S E 1, 47 8. 5 6 .2 2 1 .3 % 9 .1 % 3. 0% -4 0. 6% -4 5. 1% -63 . 8% GigaMedia L td. US D GIGM Na sdaqGS 398 . 7 7 .3 8 2 .6 % 12. 7% 38 . 2% -4 1. 9% -6 2. 2% -64 . 8% GoF is h C orpor ation US D GO F H OTC BB 5. 1 0 .2 0 33. 3% 0 .0 % -16. 7 % -3 4. 4% -3 9. 4% -66 . 1% Gr avity C o., Ltd US D GR V Y Na sdaqGM 1 9. 7 0 .7 1 -1. 1% 20. 3% 6. 4% -6 1. 6% -6 6. 2% -71 . 4% Gr ee, Inc. J PY T S E : 363 2 TS E 1, 30 2. 5 5, 36 0 -2. 0% -2. 9% NM NM NM -14 . 9% GungHo Online E nte rtainment, Inc. J PY 376 5 OSE 122 . 8 9 8, 60 0 -4. 3% -5. 2% -13. 5 % -5 1. 3% -4 6. 7% -77 . 3% HanbitS oft, Inc. KRW A0 47080 K OS E 6 2. 3 4, 06 0 21. 0% 28. 5% 52 . 6% 13 .9% -3 7. 2% -44 . 2% IAC /InterActive C orp. US D IA C I Na sdaqGS 2, 12 0. 5 15 .0 5 1 .8 % 1 .3 % -5 .5 % -5 7. 8% -6 5. 3% -70 . 2% IAS E nergy, I nc. US D IA S C . A OTC BB 1. 8 0 .0 3 0 .0 % 19. 0% -51. 0 % -8 8. 1% -9 2. 9% -93 . 4% IdeaE dge, Inc. US D OT C B B :I DA E OTC BB 1 8. 6 0 .4 4 -4. 3% -4 7. 0% -76. 2 % -8 2. 2% -6 1. 2% -84 . 5% is eemedia Inc. C AD IE E T S XV 4. 9 0 .1 2 33. 3% -4. 0% 71 . 4% -2 5. 0% -6 0. 0% -73 . 3% J umbuck E ntertainme nt P ty Ltd. A UD AS X: J MB AS X 1 3. 2 0 .4 1 2 .5 % -1 4. 6% 2. 5% -3 3. 9% -4 3. 1% -47 . 4% J umpT V Inc. C AD T S X :J T V TS X 4 0. 2 0 .4 4 -2. 2% 46. 7% -26. 7 % -4 6. 3% -6 4. 5% -68 . 6% K a boos e Inc. C AD T S X :K AB TS X 4 2. 8 0 .3 8 -7. 3% -3. 8% 2. 7% -5 4. 8% -8 2. 3% -84 . 1% K ings oft C o. Ltd. HK D 388 8 S E HK 401 . 5 2 .9 0 -4. 9% 7 .4 % 46 . 5% 0. 0% 20. 8% -32 . 7% Lingo Me dia C orpora tion C AD T S X V: LM T S XV 9. 3 0 .9 0 -14. 3% -1 0. 0% -18. 9 % -5 0. 0% -1 8. 2% -59 . 1% LiveWorld Inc. US D LV WD OTCPK 1. 2 0 .0 4 -20. 0% -4 6. 7% -20. 0 % -8 1. 0% -8 5. 7% -94 . 7% LookS mart, Ltd. US D LO OK Na sdaqGM 2 3. 3 1 .3 7 0 .0 % -2. 1% -16. 0 % -5 3. 7% -6 2. 5% -71 . 5% Magnitude Informa tion S ys tems Inc. US D MAG Y OTC BB 1 0. 9 0 .0 3 -16. 7% -7. 4% 92 . 3% 25 .0% 78. 6% -28 . 6% Mixi, Inc. J PY 212 1 TS E 688 . 7 41 3, 00 0 -9. 0% -2 6. 6% -30. 0 % -4 8. 4% -6 6. 1% -69 . 2% Mode rn T imes Group Mtg A B S EK MT G B OM 1, 01 5. 0 1 32 .0 0 -11. 9% -6. 2% -6 .0 % -6 1. 8% -6 8. 0% -71 . 0% Moggle , Inc US D MMOG OTC BB 7 0. 6 2 .0 0 0 .0 % 0 .0 % NM NM NM 0.0% MOK O. mobi L imited A UD MK B AS X 2. 1 0 .0 4 0 .0 % -2 0. 0% 0. 0% -9.1% -1 8. 4% -43 . 7% NE O W IZ G ames C orpora tion KRW A0 95660 K OS E 226 . 2 3 3, 65 0 21. 5% 76. 2% 1 65.0% 51 .2% 18. 7% -15 . 9% NetDra gon We bS oft, Inc. HK D 777 S E HK 201 . 1 2 .9 5 4 .2 % 4 .2 % 18 . 0% -5 5. 0% -7 3. 9% -78 . 3% Netea s e. com I nc. US D NT E S Na sdaqGS 2, 36 8. 8 19 .2 5 -6. 3% 12. 8% -2 .0 % -2 4. 3% 3 .1 % -29 . 1% NeXplore C orpor ation US D NXP C OTCPK 4 4. 1 0 .7 9 -7. 1% -2 1. 0% -31. 3 % 36 .2% NM -45 . 5% Ngi G roup Inc. J PY 249 7 TS E 3 5. 2 2 6, 17 0 -4. 5% -4 9. 0% -60. 0 % -7 0. 9% -8 5. 4% -86 . 9% Northgate T e chnologies L imited INR 590 057 BSE 3 1. 6 44 .3 0 12. 0% -2. 3% -26. 4 % -8 4. 6% -9 1. 0% -91 . 9% Open T e xt C or p. US D OT E X Na sdaqGS 1, 84 5. 0 35 .5 5 -0. 6% 16. 1% 23 . 7% 0. 7% 7 .3 % -9. 1% Openwa ve S ys tems I nc. US D OP W V Na sdaqGS 7 4. 1 0 .8 9 21. 1% 21. 9% 36 . 9% -3 8. 6% -5 9. 2% -68 . 9% P e rfect W orld C o., Ltd. US D PW R D Na sdaqGS 815 . 8 14 .3 0 -8. 6% -1 2. 5% -15. 4 % -4 3. 7% -3 8. 9% -57 . 3% P hotoC hannel Ne tworks Inc. C AD T S X V: P N T S XV 4 7. 6 1 .7 7 8 .6 % 1 .1 % 26 . 4% -4 9. 9% -5 3. 4% -57 . 3% Quepas a C orp. US D QP S A Na sdaqC M 1 8. 1 1 .4 3 -19. 2% -2 3. 5% -34. 7 % -5 2. 2% -5 0. 2% -58 . 7% OA O R B C Informa tion S ys tems US D R BCI RTS 4 1. 6 0 .3 0 3 .4 % -5 0. 0% -80. 0 % -9 6. 2% -9 7. 1% -97 . 2% S handa I ntera ctive E nte rtainment L td. US D S NDA Na sdaqGS 2, 11 9. 6 30 .5 5 -1. 6% 16. 6% 26 . 1% 14 .0% 7 .1 % -20 . 1% S hutterfly, Inc. US D SFLY Na sdaqGS 213 . 4 8 .4 9 -1. 3% 25. 8% 24 . 3% -1 5. 0% -4 6. 9% -52 . 8% S K C ommunications C o. , Ltd. KRW A0 66270 K OS E 234 . 2 8, 13 0 1 .2 % 40. 2% 72 . 1% -3 7. 9% -5 8. 5% -69 . 0% S NA P Inter active, Inc. US D STVI OTC BB 1 0. 6 0 .9 9 -1. 0% 0 .0 % 32 . 0% 11 .2% 10. 0% -10 . 0% S NM G lobal Holdings US D S NMN OTCPK 0. 0 0 .0 0 -66. 7% 15 0. 0% -99. 3 % -9 9. 8% -100 .0 % -1 00 .0 % S ocial Media V enure s , Inc. US D S MV I OTCPK 0. 0 1 .4 2 5 .2 % 36. 5% -0 .7 % 4 68. 0 % NM -71 . 6% S park Ne tworks , Inc. US D LO V AME X 5 4. 7 2 .5 5 10. 9% 1 .6 % -16. 4 % -4 0. 3% -5 2. 9% -54 . 2% S pectrumDNA, Inc. US D S P XA OTC BB 4. 9 0 .1 0 0 .0 % -3 3. 3% -58. 3 % NM NM -83 . 3% T encent Holdings Ltd. HK D 700 S E HK 11,192 .8 48 .3 0 7 .1 % 12. 7% 2. 3% -2 3. 8% 2 .3 % -33 . 0% T he P arent C ompany US D K IDS . Q OTCPK 0. 7 0 .0 3 -25. 0% -5 7. 1% -96. 8 % -9 8. 5% -9 9. 4% -99 . 4% T he9 Limited US D NC T Y Na sdaqGS 400 . 1 14 .4 9 -2. 3% 5 .0 % 20 . 3% -2 2. 8% -1 5. 6% -49 . 2% T heS treet.com, I nc. US D TSCM Na sdaqGM 7 9. 3 2 .6 0 -11. 6% -1 8. 0% -18. 0 % -6 2. 3% -7 6. 8% -77 . 6% T ree . C om, Inc. US D TR EE Na sdaqGM 3 6. 6 3 .9 1 0 .0 % -9. 7% 78 . 5% -6 0. 1% NM -64 . 8% Unis erve C ommunications C orp. C AD T S X V: US S T S XV 1. 6 0 .0 8 -20. 0% 60. 0% -55. 6 % -6 8. 0% -8 2. 2% -82 . 2% Unite d Online Inc. US D UNT D Na sdaqGS 425 . 4 5 .1 9 -11. 4% -1 6. 2% -21. 6 % -5 6. 0% -5 3. 2% -58 . 5% UOMO Media, Inc US D UOMO OTC BB 6. 8 0 .0 8 0 .0 % 14. 3% -48. 4 % -8 0. 0% -8 8. 9% -90 . 0% VO IS , Inc. US D VO IS OTC BB 5. 4 0 .7 5 87. 5% 15 0. 0% 0. 0% -8 1. 3% NM -86 . 6% W ebzen Inc. US D WZE N Na sdaqGM 1 7. 8 1 .5 0 0 .7 % 56. 2% 63 . 0% -4 8. 5% -4 8. 3% -66 . 3% W izz a rd S oftwa re C orporation US D WZE AME X 3 3. 0 0 .7 3 4 .3 % -1. 2% -12. 0 % -5 4. 4% -7 0. 8% -74 . 5% W oozyF ly, Inc. US D WZY F OTC BB 2. 6 0 .1 5 0 .0 % 0 .0 % NM NM NM -96 . 3% W orlds .com Inc. US D WD DD OTC BB 1 0. 5 0 .2 0 -9. 1% 33. 3% 25 . 0% -3 3. 3% -4 8. 7% -55 . 6% W ynds torm C orporation US D WY ND OTC BB 2. 2 0 .1 2 -4. 0% 0 .0 % -40. 0 % -8 0. 0% NM -85 . 9% XING A G E UR O1 BC XT R A 197 . 8 29 .7 5 -4. 0% -2. 7% 15 . 9% -9.8% -2 5. 8% -36 . 2% Y e dangO nline C orp. KRW A0 52770 K OS E 8 0. 0 7, 30 0 8 .1 % 12. 3% 23 . 7% -2 2. 3% -1 3. 0% -41 . 8% Y nk K orea Inc. KRW A0 23770 K OS E 8. 0 4, 63 0 2 .5 % 7 .7 % -25. 0 % -5 5. 5% -7 4. 3% -76 . 7% ZipL ocal Inc. C AD T S X V: ZIP T S XV 1. 3 0 .0 2 0 .0 % 10 0. 0% 1 00.0% -8 1. 8% -8 4. 6% -90 . 9% High 87. 5% 17 2. 7% 1 65.0% 4 68. 0 % 78. 6% 0.0% Low -66. 7% -8 0. 2% -99. 3 % -9 9. 8% -100 .0 % -1 00 .0 % Average 348.3 -0.7% 4.7% -0.5% -36.7% -48.6% -63.7% Figure 26. Price Performance Source. Capital IQ
  • 18. Page 18 Comparable C ompany Analys is > Web 2.0 V aluation Multiples P rimary U S D Market T E V/L T M T E V / NTM T E V /L T M TE V /NT M C ompany Na me E xc ha nge Tic ker C ap ($ m) R ev enue R e venue E B ITDA E B IT DA P /L TM E P S P /NT M E P S P /T angB V Acce lerize N ew Media, Inc. O T C BB AC L Z 9.4 4 .3 x - - - - - - Actoz S oft C o. , Ltd. K OS E A052790 78 . 4 1 .0 x - 5 .7 x - 1 5. 7x - 1. 6x AQ Inte ractive, Inc. TS E 3 83 8 19 . 3 - - - - - - 0. 3x As s ociated Media Holdings Inc. O T C PK A S MH 0.2 10. 2 x - - - - - - Bigs tring C orp. O T C BB B SGC 0.8 30. 7 x - - - - - - BoomJ Inc O T C BB BO MJ 28 . 6 29. 1 x - - - - - - Bright T hings plc A IM A IM: B GT 3.5 14. 4 x - - - - - - BroadW ebA s ia Inc. O T C PK B W BA 127 . 3 - - - - - - - C DC C orp. Na sdaqGS C HIN .A 94 . 9 0 .4 x 0. 4x 8 .1 x 6 .5 x - 12 .4 x - C hina G ateway C orpora tion O T C BB C GW Y 0.0 0 .0 x - - - - - - C hines e G amer International GTSM G T S M: 30 83 282 . 5 6 .0 x - 12. 8 x - 1 7. 3x - 5. 6x C ornerW orld C orporation O T C BB C WR L 7.0 13. 8 x - 2 .7 x - - - - DAD A S pA CM C M:DA 129 . 7 0 .8 x - 5 .0 x - 8. 0x - - Digita lF X Inte rnational, Inc. O T C BB DXN 2.0 0 .3 x - - - - - - Digita lP os t Inter active, Inc. O T C BB DG LP 0.9 4 .4 x - - - - - - Digita lT own, Inc. O T C BB DG T W 54 . 3 - - - - - - - Dolphin Digita l Me dia , Inc. O T C BB DP DM 25 . 8 - - - - - - - E olith C o. Ltd. K OS E A041060 19 . 3 1 .1 x - - - - - - E xtensions, Inc. O T C PK E XT I 18 . 9 - - - - - - - F ina ncia l Me dia Group, Inc. O T C BB F NGP 1.0 0 .0 x - 0 .1 x - - - - F luid Mus ic C anada , Inc. TS X T S X: F MN 25 . 3 3 .2 x 2. 2x - - - - 2. 1x F rogs te r Inte ractive P icture s A G XT R A FR G 13 . 0 2 .4 x - - - - - 1. 3x Ga mania Digital E nterta inme nt C o. , L td. GTSM 6 18 0 103 . 6 0 .7 x - 4 .3 x - 1 2. 0x - 1. 6x Ga meO n C o L td. TS E 3 81 2 120 . 1 0 .7 x - 2 .8 x - 1 1. 5x - 1. 5x Ge oS entric O yj HL S E G E O1 V 45 . 8 7 .7 x - - - - - 7. 0x Giant Interactive G roup, Inc. NY S E GA 1 , 478 . 5 - - - - 1. 4x 13 .0 x 0. 3x GigaMedia L td. Na sdaqGS G IGM 398 . 7 1 .7 x 1. 6x 6 .9 x 6 .4 x 1 1. 7x 10 .9 x 3. 8x GoF is h C or poration O T C BB G OF H 5.1 2 .5 x - - - - - - Gr avity C o., Ltd Na sdaqGM GRVY 19 . 7 - - - - - - - Gr ee, Inc. TS E T S E :3 63 2 1 , 302 . 5 40. 7 x - - - - - - GungHo Online E nte rtainme nt, Inc. OSE 3 76 5 122 . 8 0 .9 x - 5 .9 x - - - 35 . 3x HanbitS oft, Inc. K OS E A047080 62 . 3 0 .9 x - - - - - 2. 2x IA C /Inte rA ctive C orp. Na sdaqGS IA C I 2 , 120 . 5 0 .3 x 0. 3x 5 .7 x 2 .2 x 1 5. 8x 23 .9 x 1. 0x IA S E ne rgy, Inc. O T C BB IAS C . A 1.8 - - - - - - - IdeaE dge, Inc. O T C BB OT C B B :IDAE 18 . 6 - - - - - - 13 . 7x is ee media Inc. T S XV IE E 4.9 2 .0 x - - - - - 1. 7x J umbuck E ntertainme nt P ty Ltd. ASX A S X: J MB 13 . 2 0 .9 x - 1 .9 x - 7. 3x - 1. 6x J umpT V Inc. TS X T S X :J T V 40 . 2 4 .3 x - - - - - 2. 9x K a boos e Inc. TS X T S X: K AB 42 . 8 0 .8 x 0. 7x 11. 0 x 5 .5 x - - - K ings oft C o. Ltd. S E HK 3 88 8 401 . 5 3 .0 x - 8 .8 x - 1 1. 8x - 2. 6x Lingo Me dia C orpora tion T S XV T S XV : LM 9.3 3 .1 x - - - - - - Live World Inc. O T C PK LV W D 1.2 0 .0 x - - - - - 0. 6x LookS mart, Ltd. Na sdaqGM LO OK 23 . 3 - - - - 3. 4x - 0. 8x Magnitude Informa tion S ys tems Inc. O T C BB MAG Y 10 . 9 - - - - - - - Mixi, Inc. TS E 2 12 1 688 . 7 4 .5 x - 11. 8 x - 3 1. 9x - 5. 0x Mode rn T imes Gr oup Mtg A B OM MT G B 1 , 015 . 0 1 .0 x 0. 9x 6 .1 x 6 .5 x 3. 0x 6. 6x - Moggle , Inc O T C BB MMOG 70 . 6 - - - - - - - MOK O. mobi L imited ASX MKB 2.1 0 .7 x - - - - - 1. 4x NE O W IZ G ame s C orpora tion K OS E A095660 226 . 2 1 .7 x - 6 .4 x - 1 3. 3x - 7. 8x NetDra gon We bS oft, Inc. S E HK 7 77 201 . 1 0 .3 x - 0 .5 x - 5. 7x - 1. 1x Netea s e. com Inc. Na sdaqGS NT E S 2 , 368 . 8 - - - - 1. 8x 10 .3 x 0. 5x NeXplore C orporation O T C PK NXP C 44 . 1 - - - - - - - Ngi G roup Inc. TS E 2 49 7 35 . 2 - - - - 9. 6x - 0. 5x Northgate T e chnologies L imited B SE 59 00 57 31 . 6 0 .2 x - 1 .3 x - 2. 0x - - Open T e xt C orp. Na sdaqGS OTEX 1 , 845 . 0 2 .6 x 2. 3x 10. 1 x 8 .8 x 3 7. 7x 13 .9 x - Openwa ve S ys tems Inc. Na sdaqGS OPW V 74 . 1 - - - - - 29 .7 x 1. 0x P erfect W orld C o., Ltd. Na sdaqGS PW R D 815 . 8 - - - - 1. 3x 6. 8x 0. 4x P hotoC hannel Ne tworks Inc. T S XV T S XV : P N 47 . 6 3 .4 x 2. 0x - 6 .3 x - 28 .1 x 16 . 7x Quepas a C orp. Na sdaqC M QP S A 18 . 1 - - - - - - 7. 4x OA O R B C Informa tion S ys tems R TS R BC I 41 . 6 0 .0 x - 0 .1 x - - - - S handa Intera ctive E nte rtainment L td. Na sdaqGS S NDA 2 , 119 . 6 - - - - 1. 9x 11 .0 x 1. 0x S hutterfly, Inc. Na sdaqGS S F LY 213 . 4 0 .6 x 0. 6x 4 .2 x 3 .9 x 4 8. 0x - 1. 2x S K C ommunications C o. , Ltd. K OS E A066270 234 . 2 1 .6 x - 17. 1 x - - - - S NA P Inter active, Inc. O T C BB S TV I 10 . 6 4 .1 x - 40. 7 x - 5 8. 5x - 7. 7x S NM G lobal Holdings O T C PK S NMN 0.0 1 .1 x - - - - - - S ocial Me dia V enure s , Inc. O T C PK S MV I 0.0 0 .1 x - - - - - - S park Ne tworks , Inc. A ME X LOV 54 . 7 0 .8 x - 4 .3 x - 5. 5x - - S pectrumDNA, Inc. O T C BB S PX A 4.9 - - - - - - 5. 2x T encent Holdings Ltd. S E HK 7 00 11 , 192 . 8 13. 4 x - 27. 1 x - 3 6. 6x - 14 . 5x T he P arent C ompany O T C PK K IDS .Q 0.7 0 .2 x - - - - - - T he 9 Limited Na sdaqGS NC T Y 400 . 1 - - - - 1. 0x 7. 2x 0. 2x T he S tre et.com, Inc. Na sdaqGM T SCM 79 . 3 0 .0 x 0. 0x 0 .1 x 0 .4 x 1 3. 4x - 0. 8x T ree . C om, Inc. Na sdaqGM TR E E 36 . 6 0 .2 x 0. 2x - - - - 0. 6x Unis e rve C ommunications C or p. T S XV T S XV: US S 1.6 0 .2 x - 36. 9 x - - - - United Online Inc. Na sdaqGS UNT D 425 . 4 1 .4 x 0. 8x 6 .0 x 3 .3 x 6. 5x 8. 1x - UOMO Media, Inc O T C BB UO MO 6.8 15. 1 x - - - - - - VO IS , Inc. O T C BB VO IS 5.4 - - - - - - - W ebzen Inc. Na sdaqGM WZE N 17 . 8 - - - - - - 0. 0x W izza rd S oftwa re C orporation A ME X W ZE 33 . 0 5 .3 x - - - - - - W oozyF ly, Inc. O T C BB W ZY F 2.6 - - - - - - - W orlds .com Inc. O T C BB W DDD 10 . 5 - - - - 3. 8x - - W ynds torm C orporation O T C BB W Y ND 2.2 - - - - - - - XING A G XT R A O 1B C 197 . 8 3 .6 x - 9 .2 x - 1 9. 7x - 5. 3x Y edangO nline C orp. K OS E A052770 80 . 0 1 .7 x - 7 .4 x - 9. 7x - 4. 5x Y nk K orea Inc. K OS E A023770 8.0 0 .6 x - - - - - - ZipL ocal Inc. T S XV T S X V: ZIP 1.3 0 .7 x - - - - - - High 11 , 192 . 8 40. 7 x 2. 3x 40. 7 x 8 .8 x 5 8. 5x 29 .7 x 35 . 3x Low 0.0 0 .0 x 0. 0x 0 .1 x 0 .4 x 1. 0x 6. 6x 0. 0x Average 348.3 4.3x 1.0x 8.7x 5.0x 13.8x 14.0x 4.2x Figure 27. Valuation Comparison Source. Capital IQ
  • 19. Page 19 C omparable C ompany Analys is > Web 2.0 S ummary by C ountry C ompany Na me US D Market C a p ($ m) Avg US D Mark et C ap ($m ) US D L T M Total R ev ($m ) US D L T M Total E B I TDA ($m) E B IT DA % 39 18 , 978 . 2 2, 372. 3 3 , 011 . 1 1, 38 5.1 4 9.9% U nited S tates C h ina C hina U nited S ta tes C hina C hina 10 3 , 567 . 6 1, 015. 0 2 , 694 . 1 24 5. 7 4 6.0% C an ada Un ite d S tate s S weden C hina S we den A us tra lia 9 2 , 288 . 6 381. 4 1 , 536 . 5 18 4. 5 2 9.3% S outh K o re a J apan J apa n S we den C a na da T a iwa n 8 2 , 001 . 3 261. 6 885 . 9 13 6. 2 2 5.7% C hina C a nada T a iwa n C ana da J apan J a pa n 6 1 , 015 . 0 200. 1 525 . 2 10 1. 8 2 0.6% J a pa n S wede n C a na da J apa n U nited S tates U nite d S tate s T a iwa n 3 T a iwa n 784 . 9 Ita ly 129. 7 S outh K orea 504 . 7 T aiwan 8 4.0 I ndia 1 7.6% 2 745 . 9 105. 4 428 . 1 5 8.8 1 6.0% A us tra lia S outh K orea G erma ny H ong K ong S outh K o re a S wede n 2 210 . 8 94. 9 346 . 4 3 4.6 1 6.0% G erma ny G erma ny H ong K ong T aiwa n Ita ly I ta ly 1 129 . 7 91. 5 216 . 7 2 4.3 1 3.1% R us s ia I ta ly U nited S tates Italy Ind ia R uss ia 1 94 . 9 82. 9 138 . 1 1 8.8 5 . 8% H on g K ong Ho ng K on g S outh K o re a Ind ia H ong K ong S outh K orea 1 45 . 8 45. 8 134 . 8 1 7.6 4 . 4% F inla nd F inland F inla nd R us s ia R us s ia H ong K on g 1 41 . 6 41. 6 45 . 2 1 2.4 -10 . 9% Ita ly R u ss ia R us s ia G erman y G erma ny G erm any 1 31 . 6 31. 6 11 . 5 2.7 -19 . 1% U nited K ing dom I ndia In dia Austra lia A us tra lia C a nada 1 15 . 3 7. 6 5 .2 -1.6 N/M In dia A us tralia A us tralia F in la nd U nited K ingd om U nite d K ingdom S weden 1 Un ite d K in gdom 3.5 U nited K ing dom 3. 5 U nited K ingd om 0 .2 F in lan d -1 2.1 F inla nd N/M G rand Total 86 G rand T ota l 29 ,954.7 G ra nd Total 348. 3 G rand Total 10 ,483 .8 G rand T otal 2,29 2.7 G ra nd Tota l 17.3% Figure 28. Comparison by Country Source. Capital IQ C omparable C ompany Analys is > Web 2.0 S ummary by Exc hange C ompany Na me US D Market C a p ($ m) Avg US D Mark et C ap ($m ) US D L T M Total R ev ($m ) US D L T M Total E B I TDA ($m) E B IT DA % 22 11 , 795 . 4 3, 931. 8 1 , 536 . 5 1, 17 5.1 6 3.5% OTCB B S E HK S E HK OM Na s da qG S NY S E 11 10 , 876 . 5 1, 478. 5 466 . 9 53 0. 7 5 3.1% Nas da qG S Na sdaqG S NY S E Nas da qG S S E HK OTCB B 8 2 , 165 . 8 1, 015. 0 369 . 0 24 5. 7 4 6.0% OTCP K TS E OM S E HK OM AS X 7 1 , 478 . 5 988. 8 245 . 5 15 5. 8 4 4.0% K OS E NY S E Na s da qG S NY S E NY S E S E HK 5 1 , 015 . 0 433. 2 216 . 7 11 9. 9 3 2.0% TS E OM TS E CM TSE GTS M Nas da qG M 5 K OSE 708 . 4 G TSM 193. 1 BS E 138 . 1 K OS E 5 4.2 TS E 2 7.8% 5 386 . 2 129. 7 134 . 8 3 6.0 2 6.8% T S XV GTS M CM RTS GTSM Na sda qG S 3 279 . 8 122. 8 111 . 3 3 4.6 1 9.5% S E HK OTCB B OSE OSE CM A ME X 3 210 . 8 105. 4 85 . 5 2 4.3 1 7.6% TS X XTR A XT R A Nas da qG M BSE BSE 2 192 . 5 101. 2 82 . 8 1 7.6 1 6.0% A ME X OTCP K K OS E TSE RTS OM 2 176 . 8 45. 8 73 . 0 1 6.3 1 6.0% XT R A Na sdaqG M HL S E GTSM OSE CM 2 129 . 7 43. 8 64 . 4 1 2.4 1 4.7% ASX CM A ME X KOS E XT R A OS E 2 122 . 8 41. 6 33 . 1 5.2 1 3.1% GTSM OS E RTS AM E X A ME X R TS 1 108 . 3 36. 1 25 . 1 2.7 6 . 2% R TS TS X TS X TSX ASX K OSE HLS E 1 A ME X 87 . 6 Na s da qG M 35. 4 XT R A 22 . 6 A IM -1.6 Na sda qG M 2 . 0% 1 64 . 8 31. 6 21 . 0 -5.8 -3 . 9% OSE T S XV BSE OT C PK TSX TS X 1 45 . 8 24. 1 9 .0 -1 1.8 -10 . 9% CM HL S E OTCP K TSXV Na s da qC M XTR A 1 41 . 6 18. 1 5 .7 -1 2.0 -19 . 9% B SE RTS Na s da qC M AS X TSXV T S XV 1 31 . 6 13. 0 5 .2 -1 2.1 -29 . 4% Nas da qC M BS E T S XV HLS E HL S E OTCP K 1 18 . 1 12. 7 2 .5 -1 2.8 N/M NY S E Na sdaqC M OTCB B OT C BB Na s da qG M HL S E 1 15 . 3 7. 6 0 .2 -2 7.2 N/M A IM AS X ASX AI M OTCPK A IM 1 3.5 3. 5 0 .1 -5 4.6 N/M OM A IM A IM Nas da qC M OTCBB Na sda qC M 86 29 ,954.7 348. 3 131 .0 2,29 2.7 17.3% G rand Total G rand T ota l G ra nd Total G rand Total G rand T otal G ra nd Tota l Figure 29. Comparison by Exchange Source. Capital IQ
  • 20. Page 20 Financing - Last Three Months (US$ m) Month Company Name Country Angel/Seed Debt financing PIPE Series A Series B Series C Series D Series E Grand Total Dec-08 GoFish USA 22.5 22.5 Canada 11.1 11.1 NetShelter USA 10.5 10.5 Blue Kai UK 9.9 9.9 Taptu USA 9.9 9.9 FooMojo Scribd USA 9.0 9.0 Israel 5.3 5.3 Superfish USA 5.0 5.0 Tagged Snapmylife USA 5.0 5.0 USA 5.0 5.0 Jackbe India 5.0 5.0 ChakPak USA 4.5 4.5 Tumblr Sweden 4.3 4.3 Playdo Overlay.TV Canada 3.8 3.8 USA 2.0 2.0 DotBlu USA 1.0 1.0 Angie's List USA 0.8 0.8 StockTwits Dec-08 Total 5.0 22.5 31.9 49.2 1.0 5.0 114.6 USA 13.0 13.0 Jan-09 Yodle USA 12.5 12.5 AdMob Aster Data Systems USA 12.0 12.0 France 11.4 11.4 VirtuOz Korea 10.0 10.0 Nurien IMVU USA 10.0 10.0 USA 10.0 10.0 NewsGator DECA USA 10.0 10.0 USA 10.0 10.0 Go Internet Media USA 10.0 10.0 RatePoint One True Media USA 9.0 9.0 Israel 8.0 8.0 SundaySky USA 8.0 8.0 Play Hard Sports JibJab USA 7.5 7.5 USA 7.0 7.0 Xobni InsideView USA 6.5 6.5 France 6.2 6.2 Kewego USA 6.0 6.0 Fliqz Motionbox USA 6.0 6.0 USA 6.0 6.0 SocialMedia USA 5.0 5.0 Sportsblogs Geni USA 5.0 5.0 USA 5.0 5.0 AboutUs Gbox USA 5.0 5.0 USA 3.5 3.5 E-Global Sports Network Austria 2.5 2.5 Tripwolf Hubdub UK 1.2 1.2 USA 1.0 1.0 Snooth Canada 1.0 1.0 CoveritLive Canada 0.2 0.2 Identi.ca USA Meez Jan-09 Total 2.2 45.2 68.9 82.2 10.0 208.5 USA 35.0 35.0 Feb-09 Twitter Outbrain Israel 12.0 12.0 France 9.0 9.0 Tvtrip Oodle USA 5.6 5.6 USA 4.3 4.3 TextDigger USA 4.2 4.2 OneSpot Mixpo Canada 4.0 4.0 USA 4.0 4.0 FetchDog USA 3.0 3.0 7 Billion People WhistleBox USA 2.3 2.3 USA 2.0 2.0 Outright Tvinci Israel 1.6 1.6 USA 1.3 1.3 Cake Financial UK 0.7 0.7 fav.or.it Feb-09 Total 23.4 25.0 40.6 89.0 Grand Total 2.2 5.0 22.5 100.5 143.1 123.8 5.0 10.0 412.0 Figure 30. Financing, Last Three Months Source. Company reports
  • 21. Page 21 RELEVANT DISCLOSURES APPLICABLE TO: NONE LIST OF DISCLOSURE TERMS: None applicable. 1. 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