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09 02 24 Web 2.0 Weekly
 

09 02 24 Web 2.0 Weekly

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Twitter largest financing in last three months.

Twitter largest financing in last three months.

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    09 02 24 Web 2.0 Weekly 09 02 24 Web 2.0 Weekly Document Transcript

    • SOFTWARE & SERVICES 24 FEBRUARY 2009 DAVID SHORE, CFA, MBA 416.860.6784 WEB 2.O WEEKLY david.shore@researchcapital.com Arun Thomas (Associate) 416.860.7666 DEAL SIZES INCREASE T WIT T E R R ET AI N S T O P S PO T F O R R AI SI N G M ON E Y IN T H E L A ST T H R E E M ONT H S The largest W eb 2.0 financing of the last three months remains the $35 million raised by Twitter (Figure 2). Overall, there have been 20 financings announced in February, totalling $160 million, or $8 million on average. The average value for February is 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 $15 million in January. Financing - Last Three Months 40.0 35.0 30.0 25.0 (US$m) Feb-09 20.0 Jan-09 Dec-08 15.0 10.0 5.0 0.0 DECA IMVU Mixpo JibJab Geni Tvinci ChakPak Oodle Tagged Hubdub GoFish Nurien Taptu Tvtrip Jackbe Ego Xobni Fliqz Gbox Meez RatePoint Yodle AdMob FooMojo Playdo FetchDog Snooth Scribd DotBlu blr Filtrbox Clickpass Overlay.TV Outright Outbrain CoveritLive Identi.ca Blue Kai VirtuOz fav.or.it OneSpot Tremor Media Kewego Snapmylife Twitter TextDigger NetShelter SundaySky Motionbox AboutUs StockTwits Synthasite Social Median SocialMedia Superfish 7 Billion People NewsGator InsideView Cake Financial Sportsblogs histleBox Tripwolf Angie's List Offerpal Media Go Internet Media One True Media Play Hard Sports Pulse Entertainment Virtual Fairground Tum Aster Data Systems E-Global Sports Network Emergent Game Technologies m W 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. www.researchcapital.com 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
    • Page 2 THE WEB 2.0 UNIVERSE 85 public Web 2.0 companies identified: W e have identified 85 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 ~$330 million (but a median of only $28.6 million), with average trailing revenue of $134 million (median $36 million). The companies are also highly profitable, with an average EBITDA margin of 17.8%. On a valuation basis, the overall average is 3.6x trailing revenue (median 1.1x) and 8.2x trailing EBITDA (median 5.4x). Fifteen of the companies have more than 500 employees. Comparable C ompany Analys is > Web 2.0 T rading C urrent US D Mark et US D L T M T otal US D L TM T otal E B IT DA TE V /L T M T E V /L T M C ompany Na me L T M as of Ti c ker E xc hange C urr enc y HQ Pric e C ap ($m) R ev ($m ) E B IT DA ($m ) % R evenue E B ITDA E mployees Acce lerize N ew Media, Inc. 9 /30/20 08 AC LZ OTCB B US D United S tates 0. 31 8. 3 3. 2 ( 4. 7) NM 4. 0 x - 20 Actoz S oft C o. , Ltd. 9 /30/20 08 A05 2790 K OS E KR W S outh Korea 11 ,0 50 6 5. 2 4 8. 9 8. 9 18 .3 % 0. 9 x 4.7 x NA AQ Inte ractive, Inc. 1 2/31 /2008 3838 TS E JP Y J a pan 31 ,8 00 1 8. 3 6 3. 7 5. 1 8. 0% - - NA As s ociated Media Holdings Inc. 6 /30/20 07 AS MH OTCP 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 /30/20 08 BSGC OTCB B US D United S tates 0. 01 0. 7 0. 1 ( 2. 1) NM 2 8. 9x - 8 B r ight T hings plc 9 /30/20 08 AIM: B GT AIM G BP United K ingdom 0. 02 3. 3 0. 2 ( 1. 6) NM 1 3. 4x - 9 B r oadW ebA s ia Inc. 9 /30/20 08 B W BA OTCP K US D United S tates 1. 01 8 5. 7 0. 0 ( 4. 6) NM - - 46 C DC C orp. 9 /30/20 08 C HIN. A Na s daqG S US D Hong K ong 0. 79 8 5. 2 428. 1 18 .8 4. 4% 0. 3 x 7.5 x 3 ,125 C hina G ateway C orpora tion 9 /30/20 08 CG W Y OTCB 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 /30/20 08 G T S M: 3083 GTS M TW D T a iwan 11 1. 00 271 . 8 3 7. 1 17 .5 47 .1 % 5. 9 x 12. 4x NA C ornerW orld C orporation 1 0/31 /2008 CW R L OTCB B US D United S tates 0. 15 7. 0 0. 6 3. 1 506. 8 % 1 3. 8x 2.7 x NA DAD A S pA 9 /30/20 08 C M: DA CM E UR Italy 5. 70 117 . 7 216. 0 34 .5 16 .0 % 0. 7 x 4.6 x 5 74 DXN Holdings B hd 1 1/30 /2008 DX N K LS E MY R Ma lays ia 0. 32 2 0. 0 7 6. 0 10 .1 13 .3 % 0. 5 x 3.9 x NA Digita lP os t Inter active, Inc. 9 /30/20 08 DG LP OTCB B US D United S tates 0. 01 0. 5 0. 4 ( 3. 3) NM 3. 6 x - 11 Digita lT own, Inc. 1 1/30 /2008 DG T W OTCB B US D United S tates 2. 40 6 5. 2 NM ( 2. 5) NM - - 3 Dolphin Digita l Me dia , Inc. NA DP DM OTCB B US D United S tates 0. 50 2 4. 2 NA NM NM - - 6 E olith C o. Ltd. 1 2/31 /2007 A04 1060 K OS E KR W S outh Korea 5 85 1 8. 3 1 6. 7 ( 0. 0) -0 .3 % 1. 1 x - NA E xtensions, Inc. 9 /30/20 08 E XT I OTCP K US D United S tates 0. 15 1 4. 2 NM NM NM - - 2 F ina ncia l Me dia Group, Inc. 1 1/30 /2008 F NG P OTCB B US D United S tates 0. 03 2. 1 6. 8 1. 2 18 .3 % 0. 2 x 1.0 x 22 F luid Mus ic C anada , Inc. 9 /30/20 08 T S X: F MN TS X CAD United S tates 0. 50 2 1. 0 4. 2 ( 8. 6) NM 1. 9 x - 29 F rogs te r Inte ractive P ictures A G 6 /30/20 08 FR G XT R A E UR G er many 4. 03 1 2. 1 5. 1 ( 3. 1) -6 0. 6% 2. 3 x - NA Ga mania Digital E nterta inme nt C o. , L td. 9 /30/20 08 6180 GTS M TW D T a iwan 2 1. 55 9 4. 3 107. 2 18 .1 16 .9 % 0. 6 x 3.8 x NA Ga meO n C o L td. 1 2/31 /2008 3812 TS E JP Y J a pan 91 ,0 00 9 2. 9 7 8. 8 20 .8 26 .4 % 0. 4 x 1.6 x NA GeoS entric O yj 9 /30/20 08 G E O 1V HL S E E UR F inland 0. 04 4 5. 6 5. 2 (12 .0) NM 7. 7 x - 92 Giant Interactive G roup, Inc. 9 /30/20 08 GA NY S E US D C hina 6. 05 1, 438. 1 245. 2 1 55. 7 63 .5 % - - 1 ,016 GigaMe dia L td. 9 /30/20 08 G IG M Na s daqG S US D T a iwan 6. 03 325 . 8 200. 5 48 .0 23 .9 % 1. 3 x 5.4 x 9 75 GoF is h C or poration 9 /30/20 08 G OF H OTCB B US D United S tates 0. 11 3. 2 6. 3 (11 .0) NM 2. 2 x - 41 Gravity C o., Ltd 9 /30/20 08 GRVY Na s daqG M US D S outh Korea 0. 70 1 9. 5 3 2. 7 6. 3 19 .2 % - - 6 36 Gree, Inc. 6 /30/20 08 T S E : 3 632 TS E JP Y J a pan 4 ,7 40 1, 116. 5 3 1. 0 11 .2 36 .0 % 3 3. 9x - NA GungHo Online E ntertainme nt, Inc. 9 /30/20 08 3765 OSE JP Y J a pan 112 ,4 00 135 . 7 107. 9 15 .8 14 .7 % 1. 0 x 6.9 x NA HanbitS oft, Inc. 9 /30/20 08 A04 7080 K OS E KR W S outh Korea 3 ,3 70 4 9. 4 4 6. 4 (11 .9) -2 5. 6% 0. 7 x - NA IA C /Inte rA ctiveC orp. 1 2/31 /2008 IAC I Na s daqG S US D United S tates 1 4. 92 2, 102. 2 1 , 445 . 1 64 .6 4. 5% 0. 2 x 5.4 x NA IA S E ne rgy, Inc. 1 0/31 /2008 IAS C . A OTCB B US D C a na da 0. 02 1. 5 0. 0 ( 0. 9) NM - - NA IdeaE dge, Inc. 1 2/31 /2008 O T C B B: ID AE OTCB B US D United S tates 0. 40 1 6. 9 0. 0 ( 4. 6) NM - - NA is ee media Inc. 9 /30/20 08 IE E T S XV CAD C a na da 0. 08 3. 3 1. 1 ( 4. 4) NM 0. 6 x - NA J umbuck E ntertainme nt P ty Ltd. 6 /30/20 08 AS X :J MB AS X A UD Aus tra lia 0. 40 1 2. 8 1 0. 1 4. 7 46 .0 % 0. 8 x 1.8 x 72 J umpT V Inc. 6 /30/20 08 T S X: J T V TS X CAD C a na da 0. 40 3 6. 4 1 1. 5 ( 1. 8) -1 5. 3% 3. 9 x - NA K a boos e Inc. 9 /30/20 08 T S X: K AB TS X CAD C a na da 0. 38 4 2. 6 5 9. 4 4. 5 7. 6% 0. 8 x 11. 0x NA K ings oft C o. Ltd. 9 /30/20 08 3888 S EHK HK D C hina 2. 77 383 . 5 106. 8 36 .1 33 .8 % 2. 8 x 8.2 x 1 ,660 Lingo Media C orpora tion 9 /30/20 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 /30/20 08 L VW D OTCP K US D United S tates 0. 04 1. 2 1 1. 7 ( 1. 2) -1 0. 1% 0. 0 x - 73 LookS mar t, Ltd. 9 /30/20 08 L OO K Na s daqG M US D United S tates 1. 27 2 1. 6 6 9. 5 ( 2. 6) -3 .7 % - - 93 Magnitude Informa tion S ys tems Inc. 9 /30/20 08 MA GY OTCB B US D United S tates 0. 02 7. 9 0. 1 ( 3. 2) NM - - 13 Mixi, Inc. 1 2/31 /2008 2121 TS E JP Y J a pan 368 ,0 00 594 . 8 123. 9 47 .1 38 .0 % 3. 9 x 10. 3x NA Mode rn T imes Gr oup Mtg AB 1 2/31 /2008 MT G B OM SE K S weden 11 2. 00 840 . 3 1 , 499 . 2 2 39. 7 16 .0 % 0. 9 x 5.4 x NA Moggle , Inc 1 2/31 /2008 MMO G OTCB B US D United S tates 2. 00 7 2. 6 NM ( 1. 1) NM - - 3 MOK O. mobi L imited 6 /30/20 08 MK B AS X A UD Aus 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 /2007 A09 5660 K OS E KR W S outh Korea 33 ,7 50 217 . 0 120. 6 32 .4 26 .9 % 1. 7 x 6.4 x NA NetDra gon WebS oft, Inc. 9 /30/20 08 777 S EHK HK D C hina 2. 80 190 . 9 9 5. 3 46 .3 48 .6 % 0. 1 x 0.3 x 1 ,482 Netea s e. com Inc. 9 /30/20 08 NT E S Na s daqG S US D C hina 1 8. 63 2, 292. 5 422. 7 2 74. 4 64 .9 % - - 2 ,413 NeXplore C or por ation 9 /30/20 07 NX P C OTCP K US D United S tates 0. 50 2 7. 9 NM ( 4. 9) NM - - 19 Ngi G roup Inc. 1 2/31 /2008 2497 TS E JP Y J a pan 17 ,1 80 2 2. 4 103. 8 32 .0 30 .8 % - - NA Northgate T e chnologies L imited 1 2/31 /2008 5900 57 BSE INR India 3 8. 45 2 7. 0 135. 5 23 .8 17 .6 % 0. 2 x 1.1 x 2 86 Open T ext C orp. 1 2/31 /2008 OTE X Na s daqG S US D C a na da 3 1. 94 1, 657. 7 769. 3 1 95. 0 25 .3 % 2. 3 x 9.2 x 3 ,400 Openwa ve S ys tems Inc. 1 2/31 /2008 OPW V Na s daqG S US D United S tates 0. 82 6 8. 3 199. 6 (10 .2) -5 .1 % - - 6 27 P erfect W orld C o., Ltd. 9 /30/20 08 PWRD Na s daqG S US D C hina 1 2. 20 696 . 0 186. 9 99 .9 53 .5 % - - 1 ,401 P hotoC hannel Ne tworks Inc. 9 /30/20 08 T S XV :P N T S XV CAD C a na da 1. 96 5 2. 5 1 3. 6 ( 2. 4) -1 7. 7% 3. 8 x - NA Quepas a C orp. 9 /30/20 08 QPS A Na s daqC M US D United S tates 1. 40 1 7. 7 0. 1 (11 .8) NM - - 63 OAO R B C Informa tion S ys tems 1 2/31 /2007 RB CI RTS US D R us s ia 0. 30 4 1. 6 131. 7 17 .2 13 .1 % 0. 0 x 0.1 x NA S handa Intera ctive E nte rtainment L td. 9 /30/20 08 S NDA Na s daqG S US D C hina 3 1. 98 2, 218. 9 478. 0 2 28. 3 47 .8 % - - 2 ,564 S hutterfly, Inc. 1 2/31 /2008 S F LY Na s daqG S US D United S tates 7. 48 188 . 0 213. 5 29 .8 13 .9 % 0. 5 x 3.4 x NA S K C ommunications C o. , Ltd. 1 2/31 /2007 A06 6270 K OS E KR W S outh Korea 6 ,7 30 185 . 1 138. 7 13 .1 9. 4% 1. 3 x 14. 2x NA S NA P Inter active, Inc. 9 /30/20 08 S T VI OTCB B US D United S tates 1. 00 1 0. 7 2. 3 0. 2 10 .1 % 4. 2 x 41. 2x 5 S NM G lobal Holdings 9 /30/20 08 S NMN OTCP 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 enures , Inc. 1 2/31 /2008 S MVI OTCP K US D United S tates 1. 25 0. 0 0. 1 ( 0. 1) -6 0. 5% 0. 1 x - NA S park Networks , Inc. 9 /30/20 08 L OV AME X US D United S tates 2. 50 5 3. 6 6 0. 1 11 .7 19 .5 % 0. 8 x 4.2 x 1 76 S pectrumDNA, Inc. 9 /30/20 08 S PX A OTCB B US D United S tates 0. 10 4. 9 0. 1 ( 2. 7) NM - - 7 T encent Holdings Ltd. 9 /30/20 08 700 S EHK HK D C hina 4 6. 65 10 ,8 14.3 903. 8 4 47. 8 49 .5 % 1 2. 9x 26. 1x 6 ,039 T he P ar ent C ompany 8/2/2 008 K IDS . Q OTCP K US D United S tates 0. 02 0. 6 112. 0 (13 .5) -1 2. 0% 0. 2 x - 3 47 T he 9 Limited 9 /30/20 08 NC T Y Na s daqG S US D C hina 1 3. 22 365 . 0 252. 5 95 .1 37 .7 % - - 1 ,361 T he S tre et.com, Inc. 1 2/31 /2008 TS CM Na s daqG M US D United S tates 2. 23 6 7. 7 7 1. 9 7. 7 10 .8 % - - NA T ree . C om, Inc. 1 2/31 /2008 TR E E Na s daqG M US D United S tates 3. 98 3 7. 3 228. 6 (27 .0) -1 1. 8% 0. 2 x - NA Unis e rve C ommunications C or p. 1 1/30 /2008 T S XV :U S S T S XV CAD C a na da 0. 05 1. 0 2 3. 9 0. 1 0. 4% 0. 1 x 31. 3x NA Unite d Online Inc. 1 2/31 /2008 UNT D Na s daqG S US D United S tates 4. 76 390 . 8 669. 4 1 53. 9 23 .0 % 1. 0 x 4.5 x NA UOMO Media, Inc 1 0/31 /2008 UO MO OTCB B US D C a na da 0. 08 6. 8 0. 5 ( 0. 4) -9 1. 6% 1 5. 1x - NA VO IS , Inc. 9 /30/20 08 V OIS OTCB B US D United S tates 0. 75 5. 4 0. 0 ( 4. 0) NM - - 4 W ebz en Inc. 1 2/31 /2008 W ZE N Na s daqG M US D S outh Korea 1. 13 1 3. 4 1 9. 1 ( 1. 9) -1 0. 1% - - 3 30 W izz a rd S oftwa re C orporation 9 /30/20 08 W ZE AME X US D United S tates 0. 65 2 9. 3 6. 2 ( 6. 5) NM 4. 7 x - 1 10 W ooz yF ly, Inc. 9 /30/20 08 W ZY F OTCB B US D United S tates 0. 15 2. 6 0. 0 NM NM - - 14 W orlds .com Inc. 9 /30/20 08 W DDD OTCB B US D United S tates 0. 18 9. 4 0. 1 NM NM - - 1 W ynds torm C orporation NA W YN D OTCB B US D United S tates 0. 12 2. 2 NA NM NM - - NA XING A G 9 /30/20 08 O 1B C XT R A E UR G er many 3 1. 00 205 . 5 3 9. 9 15 .5 38 .8 % 3. 8 x 9.8 x 1 61 Y edangO nline C orp. 1 2/31 /2007 A05 2770 K OS E KR W S outh Korea 6 ,6 30 6 9. 4 4 5. 9 10 .3 22 .4 % 1. 5 x 6.7 x NA Y nk K or ea Inc. 1 2/31 /2007 A02 3770 K OS E KR W S outh Korea 4 ,1 00 6. 7 1 3. 0 ( 1. 0) -7 .6 % 0. 5 x - NA ZipL ocal Inc. 9 /30/20 08 T S XV :ZIP T S XV CAD C a na da 0. 01 0. 3 2. 8 ( 3. 8) NM 0. 3 x - NA High 10 ,8 14.3 1 ,4 99 .2 44 7. 8 506. 8 % 3 3. 9x 41. 2x 6, 039 Low 0. 0 0. 0 -2 7. 0 -9 8. 9% 0. 0 x 0.1 x 1 Average 333.1 133.9 29.0 17.8% 3.6x 8.2x 626 Median 2 8. 6 36.3 0 .1 15 .3 % 1. 0 x 5.4 x 92 Figure 1. Web 2.0 Universe Summary Source. Capital IQ
    • (U S$m ) 0.0 5.0 10.0 15.0 20.0 25.0 30.0 35.0 40.0 T w itter G oF is h Sy nthas ite Source. Company reports Tremor M edia O fferpal M edia Yodle Em ergent G am e T ec hnologies AdM ob O utbrain Figure 2. Financings, Last Three Months As ter D ata Sy s tems VirtuO z N etShelter Blue Kai IM VU N ew s G ator G o Internet M edia R atePoint D EC A N urien F ooM ojo T aptu T v trip O ne True M edia Sc ribd Sunday Sk y Play H ard Sports Soc ial M edian additional details, see Figure 30 (at end of note). J ibJ ab 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 ) Xobni Ins ideView Kew ego F liqz M otionbox Soc ialM edia O odle Superfis h Snapm y life Sports blogs J ac k be G eni T agged C hak Pak AboutU s G box Financing - Last Three Months T um blr Tex tD igger Play do O neSpot Virtual F airground Fetc hD og M ix po O v erlay .T V E-G lobal Sports N etw ork 7 Billion People m Ego T ripw olf Whis tleBox D otBlu O utright T v inc i Filtrbox C ak e F inanc ial H ubdub Snooth Angie's Lis t C ov eritLiv e Stoc k T w its fav .or.it Identi.c a C lic k pas s Puls e Entertainm ent M eez Jan-09 Feb-09 Dec-08 Page 3 average. The average value for February is above the $6.8 million average for January, with four financings over $15 Twitter (Figure 2). Overall, there have been 20 financings announced in February, totalling $160 million, or $8 million on Twitter raises $35 million: The largest W eb 2.0 financing of the last three months remains the $35 million raised by million in February (Twitter, Synthasite, Tremor Media and Offerpal Media) vs. no deals over $15 million in January. For
    • Page 4 Four video companies raise $25.9 million (total): Activity in February has been busiest among video companies (Figure 3), with Tremor Media, WhistleBox, Tvinci, and Mixpo raising a total of $25.9 million There have also been four financings of aggregation companies - Outbrain, Oodle, OneSpot and fav.or.it - raising a total of $22.5 million. Financing by Sector - February 2009 40.0 35.0 30.0 25.0 (US$m) 20.0 35.0 15.0 25.9 22.5 10.0 20.0 15.0 12.5 5.0 9.0 5.3 4.3 4.0 3.0 2.0 1.4 0.0 Comment/Reputation Gaming Wiki Travel Microblog Financial Services Search Virtual Goods Social Networks Video Aggregation Virtual World Analytics 1 4 4 1 1 1 1 2 1 1 1 1 1 Figure 3. Financings, by Sector, February 2009 Source. Company reports 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 4).
    • Page 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 4. Financings, Last 12 Months Source. Company reports Cumulative total nears $5.6 billion: Overall, on a cumulative basis, W eb 2.0 financings have totalled nearly $5.6 billion, with the majority of the financing coming in late 2007 and the first three quarters of 2008 (Figure 5).Financing for the first quarter of 2009 has now passed that raised in the fourth quarter of 2008 – reversing the downtrend since the second quarter last year.
    • Page 6 Web 2.0 Financing (cumulative) 1,400.0 6,000.0 1,313.3 1,200.0 5,000.0 1,000.0 944.7 4,000.0 800.0 712.7 (US$m) (US$m) 3,000.0 600.0 524.9 2,000.0 370.9 400.0 338.5 313.8 1,000.0 200.0 145.7151.5 135.6 101.6 87.2 82.8 57.8 77.4 37.5 33.5 18.2 41.9 35.5 38.8 20.1 0.0 0.0 Qtr4 Qtr1 Qtr2 Qtr3 Qtr4 Qtr1 Qtr2 Qtr3 Qtr4 Qtr1 Qtr2 Qtr3 Qtr4 Qtr1 Qtr2 Qtr3 Qtr4 Qtr1 Qtr2 Qtr3 Qtr4 Qtr1 2003 2004 2005 2006 2007 2008 2009 Figure 5. Financing, Cumulative Source. Company reports U.S. remains dominant: U.S. companies continue to dominate capital market activity – with almost 73% of financings/M&A involving U.S. companies (based on dollars) (Figure 6). Canadian companies generated under 1% of capital market activity based on dollar volume (Figure 6). Based on number of transactions, the U.S. leads with 73.5% of deals, while Canada is third in number of financings at 5.1% (Figure 7). Financing/M&A by Country - LTM (#) Financing/M&A by Country - LTM ($) Canada UK UK 5.1% Israel 5.1% 12.9% 4.0% France 2.8% China 7.9% ROW Russia 1.7% 9.5% Israel 1.0% Canada 0.7% France 0.7% ROW 2.3% USA USA 73.5% 72.8%
    • Page 7 Figures 6 & 7. Financing/M&A, by Country (LTM, $, #) Source. Company reports Larger volume of early-stage funding (by count): Almost half of financings in the last 12 months are for early-stage companies (Angel/Seed or Series A) (Figure 8). Series B rounds are 28.5% of the total, with later-stage (Series D, E and PIPE) deals accounting for just 7.0%. Financing by Type - LTM Series B Series C 28.5% 14.0% Series D 4.3% Angel/Seed 10.2% Debt financing 2.6% Series A PIPE 38.3% 2.1% Figure 8. Financing, by Type (LTM, #) Source. Company reports Equity financings smaller over last twelve months: In the last 12 months, the average size of Series A, B, C and D rounds have all been lower than the overall average (Figure 9). Note though that Angel/Seed rounds have been larger.
    • Page 8 Average financing round size 45.0 41.9 40.0 38.1 34.9 35.0 29.3 30.0 25.0 23.8 (US$m) 20.0 18.4 15.0 12.0 11.4 11.3 11.3 10.0 8.8 7.5 6.8 5.8 5.0 3.5 2.6 0.0 Angel/Seed Debt financing PIPE Series A Series B Series C Series D Series E LTM Average Size Overall Average Figure 9. 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 from mid 2008 until recently (Figure 10).
    • Page 9 Web 2.0 Index Price Performance 140 120 100 80 60 40 20 0 2/25/2008 3/10/2008 3/24/2008 4/7/2008 4/21/2008 5/5/2008 5/19/2008 6/2/2008 6/16/2008 6/30/2008 7/14/2008 7/28/2008 8/11/2008 8/25/2008 9/8/2008 9/22/2008 10/6/2008 10/20/2008 11/3/2008 11/17/2008 12/1/2008 12/15/2008 12/29/2008 1/12/2009 1/26/2009 2/9/2009 2/23/2009 NASDAQ COMP Web 2.0 (Market Cap Weighted) Figure 10. Web 2.0 Price Performance Source. Capital IQ DigitalTown continues to lead; Webzen falls: DigitalTown Inc. (DGTW -OTCBB) again had the best performance in the group (for stocks with prices greater than $1) (Figure 11), increasing 20.0% on the week. W ebzen Inc. (W ZEN-NasdaqGM) fell the most, -24.8%.
    • Page 10 1 Week P rice P erformance DigitalTow n, Inc. 20.0% G ungHo Online Entertainment, Inc. 11.5% PhotoChannel Netw orks Inc. 10.7% S handa Intera ctive Entertainment Ltd. 4.7% X ING A G 4.2% Tree.Com, Inc. 1.8% NEOWIZ G ames Corporation 0.3% Moggle, Inc 0.0% Eolith Co. Ltd. -0.8% IA C/InterA ctiveCorp. -0.9% S park Netw orks , Inc. -2.0% Quepas a Corp. -2.1% A Q Interactive, Inc. -2.6% Chines e G amer International -2.6% G iant Interactive Group, Inc. -2.7% Neteas e.com Inc. -3.2% Tencent Holdings Ltd. -3.4% K ings oft Co. Ltd. -4.5% NetDragon WebS oft, Inc. -5.1% Frogs ter Interactive Pictures A G -6.7% LookS mart, Ltd. -7.3% G amania Digital Entertainment Co., Ltd. -7.9% United Online Inc. -8.3% The9 Limited -8.8% DA DA S pA -8.9% Y edangOnline Corp. -9.2% Open Tex t Corp. -10.2% Mix i, Inc. -10.9% Y nk K orea Inc. -11.4% G ree, Inc. -11.6% S hutterfly , Inc. -11.9% A ctoz S oft Co., Ltd. -13.0% TheS treet.com, Inc. -14.2% Perfect World Co., Ltd. -14.7% Modern Times Group Mtg A B -15.2% HanbitS oft, Inc. -17.0% S K Communications Co., Ltd. -17.2% GigaMedia Ltd. -18.3% G ameOn Co Ltd. -20.2% Webz en Inc. -24.8% -30.0% -25.0% -20.0% -15.0% -10.0% -5.0% 0.0% 5.0% 10.0% 15.0% 20.0% 25.0% Figure 11. 1-Week Price Performance Source. Capital IQ
    • Page 11 INDUSTRY NEWS (PARTNERSHIPS, FINANCIAL RESULTS, NEW PRODUCTS) K ey Developments Company Headline Notes O pe nwave S ys te ms A nno unces A bout O penwa ve O pen wave S ys tems Inc. anno unc ed Openwave(R ) E ma il Mx 8. 0 . O pen wa ve E mail Mx is an extens ible , O penwave S ys te ms Inc . E mail Mx 8. 0 c arrier-s ca le ema il s olution that wa s ra nk ed the mark et leader and top playe r in R adicati's ann ual 200 8 (Nas da qGS : O PW V ) Me ss aging P latforms for Hos ted E mail P roviders Mark et Q ua drant. T he late st ve rs ion, E mail M x 8 .0, now s upports mo bile e ma il us in g th e IM AP IDL E standa rd, and high capac ity mailboxes . T he I MAP ID LE feature en ables s ervice providers to offer mobile email directly to th eir s ubscribers with any compatible ha nds et, an d high ca pac ity mailboxe s offe r n early limitle ss s to rage to han dle the in crea sing amount of ric h c onte nt. O pen wave E mail Mx 8.0 addres s es the s ervic e provider's requirement to offer high ca pacity mailboxe s as well as network -bas ed mobile email th at e liminates the re quire me nt for us ers to download a ha nds et clie nt. O pen wave E mail Mx 8.0 sc ales to s uppo rt any nu mber of s ubsc ribers with fas t, re liable performa nce. T he dis tribu ted, multi-threaded a rc hitec tu re allows inde pendent sc alin g of all c ompo nents to fit a n operator's s pec ific gro wth patterns , while reducing the ope ra tor's T C O . T e ls tra S elects O penwa ve's Openwave I ntegra Nex t O pen wave S ys tems Inc. has an noun ce d th at T els tra ha s se lecte d O pen wave Integra, nex t ge neration O penwave S ys te ms Inc . G en S e rvice Man agemen t S olu tio n mobile in ternet se rv ice ma nage me nt s olution des igned to provide o pen , s ec ure multimedia and multi- (Nas da qGS : O PW V ) protoc ol se rv ic e ma nage ment s upport. O pe nwav e In tegra offe rs T els tra a ra nge of be nefits , inc lu ding the ability to rapidly s cale to me et c ha nging c us to me r needs, as well a s su pport new pro toc ols, co nten t types an d applications . O pe nwav e In tegra provide s T e ls tra a n evolutiona ry roadmap with innovative s ervic es and be nefits inc luding: C o st efficient evolutiona ry roadma p from W A P gate way to n ext-ge neration data arc hitec ture, ena bling T els tra to lev erage its inv es tme nt in O pe nwav e's M obile Acc es s Ga teway fo r W AP s upport R apid deploy me nt of ne w s ervice s and ability to c os t efficiently add c apa city an d ne w co re prox ies fo r new traffic , including o pen internet ac ce ss a nd R T S P s uppo rt C ommo n s ervic es framework for a ll protoc ols -W A P , HT T P , R T S P etc. with en hanc ed ope ra tio ns , adminis tration and monitorin g (O AM ) c apa bilitie s a cros s all traffic s and se rvic es that enables e as e of prov is ioning, mainte nance, billin g, an alytic s an d operations . I ntegra als o gives o perato rs th e ability to ex pand the c apabilities o f the ir ex is ting mo bile gate G eo S e ntric O yj A nno unc es the La unc h o f G y P S ii G eoS en tric O yj's G yP S ii bus ines s unit a nnounced the lau nc h of the Gy P S ii OpenE xpe rienc e AP I, the G eoS entric Oyj (HL S E : G E O 1V) O pe nex perie nc e A pi premier all-in clus iv e pla tform for incorporating loca tio n-bas ed so cial netwo rk ing func tiona lity into embe dded mobile c lients a nd a pplic ations . T he c ompan y will be de mon stra ting s elec t s ervic es of OE x on the s oo n to be rele as ed G y P S ii n ative applic ation s uppo rt for the iP h one. G yP S ii will be in H a ll 7 B 59 at M obile W orld C on gres s, B arce lon a. O E x s upports a wh ole new us er experie nc e on mo bile devic es , a s se en o n the iP h one a nd o ther n ew us er e xperience bas ed mobile platforms . O E x allows G yP S ii partn ers to e nhan ce th eir o wn produ cts and se rv ice s with the rich loc ation-s pec ific fe atures , co nten t and commu nity o f the G yP S ii mobile so cial ne twork. In us ing the AP I, partne rs c an le verage G y P S ii's vas t interna tio nal infras truc ture a nd imme dia tely o ffer n ew s ervices to their cu stomer bas e. G eo S e ntric O yj's T W I G B us ines s Unit L aunche s G eoS en tric O yj's T W IG bus ine ss unit, an nounce d th e launch of its ne xt generation , G P S /G S M personal G eoS entric Oyj (HL S E : G E O 1V) T W I G P rote ctor protec tio n de vice --T he T W IG P ro tec tor. C re ated to protec t lon e work ers, the vu lne ra ble and tho se nee din g ac ces s to eme rgenc y ca re , th e T W IG P rotecto r is s hock an d water re sis tant, ligh t an d ex tremely e as y to us e. In a ddition it c an co mmun ic ate with all TW IG (T M ) devices an d s upport s ys te ms us ing both S M S a nd G P R S M obile P hone T ele ma tics P ro toc ol. W hen o perated in c onjunc tion with the T W IG W ebF inder, th e T W IG P rotec to r provide s a fully inte grated, mobile co mmun ications a nd pro tec tio n s olution, that can be us ed any where in the world. L G E lectronic s I nc. an d G eoS en tric O yj A nno unc es L G E lectro nics In c. and G eoS entric O yj ann ounc ed a partners hip to embed G yP S ii's loc ation -e nabled G eoS entric Oyj (HL S E : G E O 1V); L G P artne rs hip to E mbed G y P S ii's Lo ca tio n-E n abled mobile digital lifes ty le applica tio n on a ran ge of new mo bile devices . Un der the terms of the deal, LG E lec troni c s Inc . (K O S E : A0665 70) M obile Digita l L ife style A pplic ation on a R ange o f E le ctron ic s mobile cu stomers will h ave ac ces s to G y P S ii's broa d range of lo ca tio n-aware fu nc tio ns and Ne w Mobile De vice s mobile lifes ty le s ervices in cluding us er gen erated c onte nt s haring, frien d finding and so cial ne tworking application, as well a s the ability to view it all o n a ma p within a s ingle, e as y to n avigate us er inte rfac e. T he s ervice will be prov ide d in pa rtn ersh ip with Intrins yc, L G 's nav igation so lution prov ide r. W ithin the pa rtners hip agree men t, L G E lectronic s and Gy P S ii will s hare adv ertis ing a nd s po ns orsh ip re ve nues ge nerate d by us ers of G yP S ii on the n ew L G devices . T he range will firs t launch ac ro ss the W indows Mo bile o perating sy s tem, c los ely fo llowed by An droid and ja va -e nabled devices . B eta wave C orpo ra tio n A nnou nc es A d-S upported B etawa ve C orporation (Go F is h C o rporation) an nounce d th e premie re of B etawav e T V , an ad-s upported G oF is h C orporation (O T C B B : G OF H ) V ideo P latfo rm v ide o platform. B e tawav e T V ha s lau nc hed on s ev eral publis hers with in the B e tawav e portfolio , an d will als o be available to s elect pa rtners not in the B e tawav e publis he r n etwork . T he produ ct fea tures advertis er- s afe , family -friendly progra mmin g includin g quality animation, youth-orie nted news , a ction s ports , mov ie an d v ide o ga me in forma tio n, s pe cial ev ents, ce le brity interv iews , fas hion, and health and beau ty se gments . B etawa ve T V o ffers marke ters a s c alable video a dve rtis in g an d dis tribu tio n s olution a nd e nables th em to ex tend the ir relations hip beyo nd dis play me dia and immersiv e integra tio ns . T he unive rs al play er is c us tomized for ea c h publis her's look an d fee l a nd is inc orporated in to the n aviga tio n of eac h s ite e ns uring a high lev el of co ns umer ado ption. S pons orship opportunitie s in clude the ability to feature mes sa ges be fore an d after profe ss iona lly pro duc ed video programming, as well as throu gh o verlay s at appropriate points in P hotoC ha nnel Networks I nc . A nnounc es the P hotoC han nel N etwo rk s In c. ann ounced the la unc h o f its new P NI Open A c ce ss P rojec t. T he P N I O pen P hotoC ha nne l Network s Inc . L aunc h of th e P NI O pe n A cce ss P roje ct A cces s P roje ct has been created for non -P NI c ustome rs to be able to tak e adv anta ge o f an d utiliz e the (T S X V: P N) po wer of the P NI P latfo rm's 'R o uting Tier' that cu rren tly de livers millions o f ima ges an d orde rs from P NI ho sted we bs ite s to its c us tomer's s tores and production fa cilities . T he P N I O pen Acc es s P rojec t will be ins trume ntal in prov idin g an output so lution for th e billions of digital image s cu rrently s tored on the we b or in de sk top s oftwa re produ cts whic h cu rren tly ha ve no direc t pro fes s ion al printing option . T he P N I O pen A cces s P roje ct also in clude s an o ption for la rger entities to sh are rev enue with P N I. T h is s y mbiotic relations hip will be a k ey driv er fo r thos e organiza tions tha t would like to work direc tly with P N I to provide A lfa B ank F ile s S uit A gains t O A O R B C Informa tio n A lfa B ank ha s filed a s uit again st O AO R B C In formation S ys te ms dema nding the repaymen t of a $ 41. 7 81 O AO R B C Informa ti on S ys tems S y ste ms for $41 . 8 M illion D ebt million debt, plus th e interes t wo rth $2 5, 06 9. T he ban k se ek s the re co very of a de bt wh ich formed as a (R T S : R B C I) c ons equenc e of the partie s' fix ed-te rm de als with se curities and foreign cu rren cy, ' unde r a n agre ement s igned on M arch 24, 200 8. T he Moscow A rbitration C o urt ha s re gis te re d a s uit, filed by the R oy al B a nk of S co tla nd a gains t A O R B C Information S ys tems , O O O R B C -C enter a nd ZA O R B C -TV protes ting th eir faerfect Whon or a cL td. reported sa les he sults is esthe n ted month s 5 . 17 millio n. mber 200 8. F or the period, P ilure to orld C o. redit agre ement. T res uit fo r tima in e at R UB ende d S epte P erfect W orld C o. L td. R epo rts Ov ers eas S ales P erfec t W orld C o., L td. R e su lts for the Nine Mo nths E nded S eptember th e c ompany 's ov ers eas s ales revenue s amounted to US D 19 million, s welling mo re tha n two times fro m (Nas da qGS : PW R D) 2 008 U S D 6 millio n in th e s ame period ended S eptember 200 7. T he growth was attributed to the compan y's B oomJ Inc. R epo rts R eve nue R es ults for th e M onth de votion to. techno logy res ea rc h and devthe mon th o f J anu ary 2 009. T he co mpa ny re ported $2. 3 million in B oomJ Inc reported re ven ue res ults fo r elopment. B oomJ Inc (O T C B B : B O MJ ) o f J anuary 2 009; P rov ides E arnin gs G uidance for rev enue s for th e month of J a nuary and $1. 07 million for th e month of Dec ember. T h e c ompan y a nnou nc ed the M onth of F e bruary 2009 th at it is on tra ck for c ontinue d s trong growth in the mon th o f F ebru ary. Figure 12. Key Developments Source. Capital IQ
    • Page 12 VALUATION MMOG companies lead market cap charts: Seven companies in our W eb 2.0 universe top US$1 billion in market capitalization (Figure 13). Sixty-three of the 85 (down from 64 last week) companies have market caps under US$100 million, with 27 (vs. 27 last week) under $10 million. Online gaming companies dominate the top of the list with four of the top seven by market cap. Market C ap (US D m) Tencent Holdings L td. Netea s e.com Inc. 2292.5 S handa Interac tiv e Entertainment L td. 2218.9 2102.2 IA C/InterA ctiveCorp. Open Tex t Corp. 1657.7 G iant Intera ctive G roup, Inc. 1438.1 G ree, Inc. 1116.5 Modern Times G roup Mtg A B 840.3 Perf ect World Co., L td. 696.0 Mix i, Inc. 594.8 United Online Inc. 390.8 383.5 K ings oft Co. L td. The9 Limited 365.0 G igaMedia L td. 325.8 Chines e G a mer International 271.8 NEOWIZ G a mes Corporation 217.0 XING A G 205.5 NetDragon WebS oft, Inc. 190.9 S hutterf ly , Inc. 188.0 S K Communica tions Co., L td. 185. 1 G ungHo Online Entertainment, Inc. 135.7 DA DA S pA 117.7 G a mania Digital Enterta inment Co., L td. 94. 3 G ameOn Co L td. 92. 9 B roadWebA s ia Inc. 85.7 CDC Corp. 85.2 Moggle, Inc 72.6 Y eda ngOnline Corp. 69.4 Openw av e S y s tems Inc. 68.3 TheS treet.com, Inc. 67.7 DigitalTow n, Inc. 65.2 A ctoz S of t Co., L td. 65.2 S pa rk Netw orks , Inc. 53.6 PhotoCha nnel Netw orks Inc. 52.5 49.4 HanbitS oft, Inc. G eoS entric Oy j 45.6 K aboos e Inc. 42. 6 OA O R B C Information S y s tems 41. 6 Tree.Com, Inc. 37. 3 J umpTV Inc. 36.4 Wiz z ard S oftw are Corporation 29.3 NeXplore Corporation 27.9 Northgate Tec hnologies Limited 27.0 Dolphin Digital Media , Inc. 24.2 Ngi G roup Inc. 22.4 LookS ma rt, L td. 21.6 Fluid Mus ic Ca nada , Inc. 21.0 DXN Holdings B hd 20.0 G ravity Co., Ltd 19.5 A Q Interactive, Inc. 18.3 Eolith Co. L td. 18.3 Quepas a Corp. 17.7 Idea Edge, Inc. 16.9 Ex tens ions , Inc. 14.2 Webz en Inc. 13.4 J umbuck Entertainment Pty L td. 12.8 Frogs ter Interactive Pic tures A G 12.1 10.7 S NA P Interactive, Inc. Worlds .com Inc. 9.4 Lingo Media Corporation 9.3 A cceleriz e New Media , Inc. 8.3 Magnitude Inf ormation S y s tems Inc. 7.9 CornerWorld Corporation 7.0 UOMO Media , Inc 6.8 Y nk K orea Inc. 6.7 5.4 V OIS , Inc. S pec trumDNA , Inc. 4.9 B right Things plc 3.3 is eemedia Inc. 3.3 G oFis h Corporation 3.2 Wooz y Fly , Inc. 2.6 Wy nds torm Corporation 2.2 Financial Media G roup, Inc. 2.1 MOK O.mobi Limited 2.1 IA S Energy , Inc. 1.5 LiveWorld Inc. 1.2 Unis erve Communica tions Corp. 1.0 B igs tring Corp. 0.7 The Parent Compa ny 0.6 DigitalPos t Interactive, Inc. 0.5 Z ipLoc al Inc. 0.3 A s s ociated Media Holdings Inc. 0.2 China G a tew ay Corporation 0.0 S ocial Media V enures , Inc. 0.0 S NM Global Holdings 0.0 0 500 1,000 1,500 2,000 2,500 3,000 3,500 4,000 Figure 13. Market Cap Ranking Source. Capital IQ TEV/Revenue (LTM) averages 3.6x: The overall average TEV/Revenue (LTM) multiple for our group is 3.6x – down from 4.4x last week (Figure 14). However, this is skewed by Gree (3633-TSE) at 33.9x and Bigstring (BSGC-OTCBB) at 28.9x. The median is only 1.1x. Note that we exclude multiples greater than 50x. Thirty-four of the companies have multiples under 1.5x.
    • Page 13 T E V/L T M R evenue (x) 40. 0 33.9 35. 0 28.9 30. 0 25. 0 20. 0 15. 1 1 13.8 12.9 3.4 15. 0 10. 2 10. 0 7. 7 5.9 4.7 3.6 3.8 3.8 3.9 3.9 4. 0 4.2 A verage, 3.6 2.8 3.1 5. 0 1. 5 1.7 1.9 2.2 2. 3 2.3 1.0 1.0 1.1 1.1 1.3 1.3 0.0 0.1 0.1 0.10.2 0. 2 0.2 0.2 0.2 0.3 0.3 0.4 0.5 0.5 0.5 0.6 0.6 0.70. 7 0.7 0.8 0.8 0. 8 0.9 0.9 0. 0 N E O WIZ G ames C orporation MO K O .mobi L imited UO MO Media, Inc G a mania Digital E ntertainment C o., Ltd. J umbuck E nterta inment P ty L td. G ungH o O nline E ntertainment, Inc. C hines e G amer Interna tional U nis erve C ommunications C orp. N orthgate T echnologies L imited DXN Holdings B hd G oF is h C orporation T ree.C om, Inc. F inancial Media G roup, 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 United O nline Inc . O pen T ex t C orp. P hotoC ha nnel Network s Inc. J umpT V Inc . S NAP Intera ctive, Inc. NetDra gon WebS oft, Inc . IAC /InterAc tiveC orp. is eemedia Inc . S pa rk N etwork s , Inc . E olith C o. Ltd. G igaMedia Ltd. F rogs ter Intera ctiv e P ic tures AG XIN G AG Mix i, Inc . As s ociated Media Holdings Inc . T encent Holdings Ltd. G ree, Inc . B right T hings plc L iveWorld Inc . S ocial Media V enures , Inc . ZipLoca l Inc . Y nk K orea Inc . H anbitS oft, Inc . K aboos e 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 14. 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 15 shows the average TEV/Revenue multiples by stock exchange. The OTCBB has the largest number of companies (20), trading at an average multiple of 8.0x (down from 9.5x from last week). On a geographic basis, the United States has the most companies (37), trading at an average of 3.9x revenue (down from 4.9x from last week) (Figure 16). Ten of the companies are Canadian (average 3.3x revenue). Average TEV/LTM Revenue - By Exchange Average TEV/LTM Revenue - By Country 16.0 16.0 13.4 13.4 14.0 14.0 12.7 12.0 12.0 10.0 8.0 10.0 9.8 (x) 8.0 7.7 (x) 8.0 7.7 6.0 5.3 3.3 5.3 4.0 3.0 2.8 2.3 2.2 6.0 1.6 1.1 1.0 3.9 1.0 0.9 0.8 0.7 0.5 3.3 2.0 3.0 2.6 0.2 0.2 4.0 0.0 1.1 2.0 OTCPK 0.9 0.8 0.7 0.5 OTCBB GTSM NasdaqGM TSE HLSE SEHK KOSE OSE NasdaqGS OM CM XTRA AMEX TSX KLSE BSE AIM TSXV ASX 0.3 0.2 0.0 Germany Kingdom Japan Finland China United Canada Malaysia Hong India Italy South Korea Kong States Taiwan Australia Sweden United 1 5 20 1 3 2 2 2 8 3 5 7 1 11 1 2 1 1 1 5 # Companies 1 6 1 8 37 10 2 3 9 1 2 1 1 1 1 # Companies Figures 15 & 16. TEV/Revenue Ranking (Exchange, Country) Source. Capital IQ TEV/EBITDA (LTM) averages 8.2x: The average multiple for the 31 companies with positive EBITDA (and multiples under 100x) is 8.2x LTM EBITDA (9.4x last week), led by SNAP Interactive’s (STVI-OTCBB) 41.2x multiple (Figure 17). Twenty of the companies have EBITDA multiples under 7x. The median multiple is 5.4x.
    • Page 14 T E V/L T M E B IT DA (x) 45. 0 41. 2 40. 0 35. 0 31. 3 30. 0 26. 1 25. 0 20. 0 14.2 15. 0 12. 4 10. 3 11. 0 9. 8 9. 2 A verage, 8. 2 8.2 10. 0 7. 5 6. 9 6. 7 6. 4 5. 4 5.4 5. 4 4. 6 4. 7 4. 5 4. 2 3. 9 3.8 3. 4 5. 0 2. 7 1. 8 1. 6 1. 1 1.0 0. 3 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. Northgate T ec hnologies L imited DXN Holdings B hd 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 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 . G igaMedia L td. IAC /InterAc tiveC orp. 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 17. TEV/EBITDA Ranking Source. Capital IQ TEV/EBITDA (LTM) by country/exchange: Figure 18 shows the average TEV/EBITDA multiples by stock exchange. The OTCBB has the largest number of companies (20), trading at an average multiple of 15x, while companies on the TSXV have the highest multiples (31.3x). On a geographic basis, the United States has the most companies (37), trading at an average of 8.9x EBITDA (Figure 19). Ten of the companies are Canadian (average 17.2x EBITDA). Average TEV/LTM EBITDA - By Exchange Average TEV/LTM EBITDA - By Country 35.0 31.3 20.0 18.0 17.2 30.0 16.0 25.0 14.0 20.0 11.6 (x) 12.0 15.0 15.0 11.611.0 (x) 10.0 9.8 8.9 9.8 8.1 8.0 8.0 6.9 6.0 7.5 10.0 7.2 8.0 5.9 5.4 6.3 5.4 4.6 4.2 3.9 1.8 6.0 5.0 1.1 0.1 4.6 3.9 4.0 0.0 OTCBB GTSM SEHK KOSE OSE TSE NasdaqGS RTS OM CM TSX XTRA AMEX KLSE BSE 2.0 TSXV 1.1 ASX 1.8 0.0 Germany Canada China United Hong Japan Malaysia India Italy South Korea Kong States Taiwan Australia Sweden # Companies 5 20 3 3 2 2 7 1 5 11 1 1 2 1 2 1 #N/A # Companies 10 8 2 37 9 1 3 6 1 1 1 2 1 Figures 18 & 19. TEV/EBITDA Ranking (Exchange, Country) Source. Capital IQ P/E (LTM) averages 14.6x: The average multiple for the 31 companies with positive earnings (and multiples under 100x) is 14.6x LTM EPS (unchanged), led again by TheStreet.com (TSCM-NASDAQ) 71.8x multiple (Figure 20). Eighteen of the companies have P/E multiples under 10x. The median is just 8.8x.
    • Page 15 P /E L T M (x) 80.0 71.8 70.0 59.1 60.0 50.0 42.3 40.0 33.9 35.4 27.6 30.0 20.5 15.7 16.8 20.0 A verage, 14.6 13.3 13.7 11.3 9.6 11.0 9.1 8.8 7.2 7.1 6.3 10.0 5.4 5.4 3.9 3.4 3.1 2.6 1.7 1.8 2.0 1.1 1.3 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 Northgate T echnologies Limited DXN H oldings B hd G iant Interactive G roup, Inc. G ameO n C o Ltd. Modern T imes G roup Mtg AB Neteas e.com Inc. S handa Interactive E ntertainment Ltd. Ngi G roup Inc. O pen T ex t C orp. S NAP Interactive, Inc. T heS treet.com, 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 20. P/E Ranking Source. Capital IQ P/E (LTM) by country/exchange: Figure 21 shows the average P/E multiples by stock exchange. The OTCBB has the largest number of companies (20), trading at an average multiple of 31.3x. On a geographic basis, the United States has the most companies (37), trading at an average of 28.7x earnings (Figure 22). Ten of the companies are Canadian (average 33.9x EPS). Average P/E - By Exchange Average P/E - By Country 40.0 40.0 37.5 33.9 35.0 35.0 30.0 31.3 30.0 25.0 28.7 20.5 25.0 17.4 (x) 20.0 20.5 14.4 13.9 (x) 20.0 13.4 15.0 14.4 11.9 12.5 7.2 10.0 15.0 7.1 11.9 5.4 3.9 2.6 5.0 7.2 7.4 10.0 1.8 7.1 3.9 0.0 5.0 2.6 OTCBB NasdaqGM GTSM SEHK TSE NasdaqGS KOSE CM OM XTRA AMEX KLSE BSE ASX 0.0 Germany Canada United Japan China Malaysia Italy South Korea States Taiwan Australia Sweden 5 20 2 3 5 2 11 7 1 2 2 1 1 1 # Companies 10 37 2 6 3 9 8 1 2 1 1 # Companies Figures 21 & 22. P/E Ranking (Exchange, Country) Source. Capital IQ
    • 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 23. Upcoming Events Source. Company reports E arnings C alendar C ompany Date & T im e Quarter Co nf Call De tails P hotoC ha nnel N e tworks Inc. ( T S X V :P N ) W e dne s da y, F e brua ry 25 , 2 009 4 :30 P M ( E S T ) Q1 20 09 88 8-30 0-00 53 N etea s e.com Inc. ( N as daqG S : N TE S ) W e dne s da y, F e brua ry 25 , 2 009 8 :00 P M ( E S T ) Q4 20 08 80 0-21 8-07 13 S handa Inte ra ctive E nterta inment L td. ( Na s da qG S :S ND A ) T hurs da y, F e brua ry 2 6, 20 09 8: 00 AM ( E S T ) Q4 20 08 1-86 6-38 3-79 89 P erfec t W orld Co., Ltd. ( N as daqG S : P W R D ) Monda y, M arch 02 , 2 009 8 :00 A M ( E S T ) Q4 20 08 1-86 6-51 9-40 04 Figure 24. Earnings Calendar Source. Company reports
    • Page 17 C omparable C ompany Analys is > W eb 2.0 P ric e P erforma nce 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 leri ze N ew Medi a, I nc. US D AC L Z O T C BB 8. 3 0 .3 1 -11 . 4% -1 1. 4% - 22. 5 % -4 8. 3% -55. 7% -60 . 3% Actoz S oft C o. , Ltd. KRW A0 527 90 K OS E 6 5. 2 1 1, 05 0 -13 . 0% 4 .2 % 25 . 6% 12 .1 % 2 6. 7% -21 . 6% AQ Inte ractive, Inc. J PY 383 8 TS E 1 8. 3 3 1, 80 0 -2. 6% 10. 4% -9 .1 % -7 5. 2% -89. 7% -90 . 7% As s ociated Me dia Holdings I nc. US D AS MH O T C PK 0. 2 0 .0 1 -50 . 0% -3 7. 5% - 37. 5 % NM -87. 5% -93 . 8% Bi gs tring C orp. US D BS GC O T C BB 0. 7 0 .0 1 -12 . 5% -2 0. 0% - 39. 1 % -8 1. 3% -93. 6% -94 . 0% Br ight T hings plc G BP AIM:B G T A IM 3. 3 0 .0 2 -12 . 6% 10. 7% 82 . 4% -1 1. 5% -41. 5% -60 . 9% Br oadW ebA s ia Inc. US D BW B A O T C PK 8 5. 7 1 .0 1 -32 . 7% 0 .0 % 7 41 .7 % -2 2. 3% NM -66 . 3% C DC C orp. US D C HIN. A Na sdaqGS 8 5. 2 0 .7 9 -10 . 2% -5. 1% 3. 9% -7 0. 1% -79. 3% -81 . 2% C hina G ateway C orpora tion US D C GW Y O T C BB 0. 0 0 .0 0 -33 . 3% -3 3. 3% - 80. 0 % -9 4. 4% -99. 7% -99 . 7% C hines e G amer International TW D GT S M: 308 3 GTSM 271 . 8 1 11 .0 0 -2. 6% 22. 9% 43 . 4% 31 .4 % 1 6. 1% -10 . 5% C ornerW orld C orporation US D CW R L O T C BB 7. 0 0 .1 5 -63 . 4% -4 0. 0% - 25. 0 % -7 6. 9% -89. 3% -89 . 7% DAD A S pA E UR C M:DA CM 117 . 7 5 .7 0 -8. 9% -8. 7% - 11. 5 % -5 1. 3% -57. 3% -64 . 8% DXN Holdings Bhd MYR DXN K LS E 2 0. 0 0 .3 2 -12 . 5% -1 1. 3% - 13. 7 % -1 9. 2% -33. 0% -43 . 8% Digita lP os t I nteractive, Inc. US D DGL P O T C BB 0. 5 0 .0 1 -38 . 5% -6 6. 7% - 80. 0 % -8 6. 7% -96. 9% -97 . 6% Digita lT own, I nc. US D DGT W O T C BB 6 5. 2 2 .4 0 2 0. 0% 4 .3 % 20 . 0% -4 0. 0% 4 .3 % -60 . 7% Dolphin Digita l Me dia , Inc. US D DPDM O T C BB 2 4. 2 0 .5 0 -6. 0% -2 8. 9% - 41. 4 % -4 4. 7% NM -55 . 9% E olith C o. Ltd. KRW A0 410 60 K OS E 1 8. 3 58 5 -0. 8% 13. 6% 20 . 6% -2 3. 5% -65. 2% -71 . 3% E xtensions, Inc. US D E XT I O T C PK 1 4. 2 0 .1 5 -25 . 0% 0 .0 % 1 85 .7 % 50 .0 % 0 .0 % -85 . 1% F ina ncia l Me dia Group, I nc. US D F NGP O T C BB 2. 1 0 .0 3 11 3. 3% 6 .7 % - 68. 0 % -9 5. 4% -87. 2% -96 . 7% F luid Mus ic C anada , Inc. CAD T S X :F MN TS X 2 1. 0 0 .5 0 -16 . 7% 58. 7% 66 . 7% -6 6. 2% NM -75 . 5% F rogs te r Inte ractive P icture s A G E UR FR G XT R A 1 2. 1 4 .0 3 -6. 7% -1 9. 4% 7. 5% -4 4. 7% -28. 3% -47 . 3% Ga mania Digital E nterta inme nt C o. , L td. TW D 618 0 GTSM 9 4. 3 21 .5 5 -7. 9% 0 .0 % 70 . 4% -1 2. 6% -25. 7% -41 . 7% Ga meO n C o L td. J PY 381 2 TS E 9 2. 9 9 1, 00 0 -20 . 2% -2 5. 5% - 39. 3 % -2 8. 3% -31. 6% -44 . 3% GeoS entric O yj E UR GE O1 V HL S E 4 5. 6 0 .0 4 0 .0 % 0 .0 % 33 . 3% -3 3. 3% -50. 0% -55 . 6% Giant Inte ractive G roup, Inc. US D GA NY S E 1, 43 8. 1 6 .0 5 -2. 7% 3 .2 % -1 .5 % -3 7. 3% -41. 9% -64 . 8% GigaMe dia L td. US D GIGM Na sdaqGS 325 . 8 6 .0 3 -18 . 3% -5. 9% 37 . 4% -4 7. 5% -69. 2% -71 . 2% GoF is h C orporation US D GO F H O T C BB 3. 2 0 .1 1 -45 . 0% -5 2. 2% - 47. 6 % -6 3. 3% -79. 2% -81 . 4% Gravity C o., Ltd US D GR V Y Na sdaqGM 1 9. 5 0 .7 0 -1. 4% -7. 9% 1. 4% -5 1. 7% -58. 1% -67 . 0% Gree, Inc. J PY T S E : 363 2 TS E 1, 11 6. 5 4, 74 0 -11 . 6% -1 7. 6% NM NM NM -24 . 8% GungHo Online E ntertainme nt, Inc. J PY 376 5 OSE 135 . 7 11 2, 40 0 1 1. 5% 14. 1% 10 . 6% -3 9. 4% -36. 9% -74 . 2% HanbitS oft, Inc. KRW A0 470 80 K OS E 4 9. 4 3, 37 0 -17 . 0% 9 .6 % 13 . 5% 2. 6% -45. 3% -52 . 9% IA C /Inte rA ctive C orp. US D IA C I Na sdaqGS 2, 10 2. 2 14 .9 2 -0. 9% -0. 5% -0 .6 % -1 3. 0% -62. 5% -70 . 5% IA S E ne rgy, Inc. US D IA S C . A O T C BB 1. 5 0 .0 2 -16 . 0% 0 .0 % - 58. 0 % -8 9. 5% -94. 0% -94 . 5% IdeaE dge, Inc. US D OT C B B :I DA E O T C BB 1 6. 9 0 .4 0 -9. 1% -4 2. 9% - 77. 8 % -8 3. 7% -62. 0% -85 . 9% is ee media Inc. CAD IE E T S XV 3. 3 0 .0 8 -33 . 3% -1 1. 1% 33 . 3% -5 2. 9% -81. 6% -82 . 2% J umbuck E ntertainme nt P ty Ltd. A UD AS X: J MB ASX 1 2. 8 0 .4 0 0 .0 % -1 6. 7% 0. 0% -3 5. 5% -44. 4% -48 . 7% J umpT V Inc. CAD T S X :J T V TS X 3 6. 4 0 .4 0 -9. 1% 33. 3% 14 . 3% -5 7. 9% -50. 0% -68 . 8% K a boos e Inc. CAD T S X :K AB TS X 4 2. 6 0 .3 8 0 .0 % 8 .6 % 40 . 7% -4 8. 6% -83. 0% -84 . 1% K i ngs oft C o. Ltd. HK D 388 8 S E HK 383 . 5 2 .7 7 -4. 5% 4 .1 % 32 . 5% -5 .1 % 9 .9 % -35 . 7% Lingo Me dia C orpora tion CAD T S X V: LM T S XV 9. 3 0 .9 0 0 .0 % -8. 2% - 23. 7 % -5 1. 4% -30. 2% -59 . 1% Live World Inc. US D LV WD O T C PK 1. 2 0 .0 4 0 .0 % 33. 3% - 55. 6 % -8 4. 0% -85. 7% -94 . 7% LookS mart, Ltd. US D LO OK Na sdaqGM 2 1. 6 1 .2 7 -7. 3% -5. 9% 0. 8% -6 0. 4% -64. 8% -73 . 5% Magnitude Informa ti on S ys tems I nc. US D MAG Y O T C BB 7. 9 0 .0 2 -28 . 0% -3 7. 9% 5. 9% 20 .0 % 6 3. 6% -48 . 6% Mixi, Inc. J PY 212 1 TS E 594 . 8 36 8, 00 0 -10 . 9% -2 8. 1% - 37. 3 % -5 6. 5% -70. 3% -71 . 3% Mode rn T imes Group Mtg A B S EK MT G B OM 840 . 3 1 12 .0 0 -15 . 2% -1 6. 1% - 17. 8 % -6 7. 8% -72. 4% -75 . 4% Moggle, Inc US D MMOG O T C BB 7 2. 6 2 .0 0 0 .0 % 0 .0 % 33 . 3% NM NM 0 .0 % MOK O. mobi L imited A UD MK B ASX 2. 1 0 .0 4 0 .0 % -2 0. 0% 0. 0% 5. 3% -27. 3% -43 . 7% NE O W IZ G ame s C orpora tion KRW A0 956 60 K OS E 217 . 0 3 3, 75 0 0 .3 % 46. 7% 1 08 .3 % 62 .7 % 1 1. 0% -15 . 6% NetDra gon We bS oft, Inc. HK D 777 S E HK 190 . 9 2 .8 0 -5. 1% 5 .7 % 10 . 7% -4 7. 5% -76. 4% -79 . 4% Netea s e. com Inc. US D NT E S Na sdaqGS 2, 29 2. 5 18 .6 3 -3. 2% 4 .0 % 6. 5% -2 9. 8% -13. 1% -31 . 4% NeXplore C or por ation US D NXP C O T C PK 2 7. 9 0 .5 0 -36 . 7% -2 3. 1% - 60. 6 % -9 .1 % NM -65 . 5% Ngi G roup Inc. J PY 249 7 TS E 2 2. 4 1 7, 18 0 -34 . 4% -6 4. 7% - 68. 9 % -8 1. 5% -90. 7% -91 . 4% Northgate T e chnologies L imited INR 590 05 7 B SE 2 7. 0 38 .4 5 -17 . 5% -1 7. 5% - 27. 2 % -8 6. 8% -92. 1% -93 . 0% Open T e xt C orp. US D OT E X Na sdaqGS 1, 65 7. 7 31 .9 4 -10 . 2% 0 .3 % 23 . 1% -7 .0 % -0. 8% -18 . 3% Openwa ve S ys tems I nc. US D OP W V Na sdaqGS 6 8. 3 0 .8 2 -7. 9% 24. 2% 39 . 0% -4 3. 8% -60. 2% -71 . 3% Pe rfect W orld C o., Ltd. US D PW R D Na sdaqGS 696 . 0 12 .2 0 -14 . 7% -1 9. 6% - 25. 5 % -5 1. 7% -54. 9% -63 . 6% PhotoC hannel Ne tworks Inc. CAD T S X V: PN T S XV 5 2. 5 1 .9 6 1 0. 7% 24. 1% 63 . 3% -4 3. 0% -46. 4% -52 . 8% Quepas a C orp. US D QP S A Na sdaqC M 1 7. 7 1 .4 0 -2. 1% -2 4. 3% - 37. 2 % -5 6. 9% -48. 1% -59 . 5% OA O R B C Informa ti on S ys tems US D R BC I R TS 4 1. 6 0 .3 0 3 .4 % -5 0. 0% - 80. 0 % -9 6. 2% -97. 1% -97 . 2% S handa I ntera ctive E nte rtainment L td. US D S NDA Na sdaqGS 2, 21 8. 9 31 .9 8 4 .7 % 15. 2% 37 . 7% 20 .1 % -3. 3% -16 . 4% S hutterfly, Inc. US D SFLY Na sdaqGS 188 . 0 7 .4 8 -11 . 9% 19. 7% 6. 9% -2 4. 0% -51. 1% -58 . 4% S K C ommunications C o. , Ltd. KRW A0 662 70 K OS E 185 . 1 6, 73 0 -17 . 2% -4. 5% 60 . 2% -4 5. 5% -65. 9% -67 . 9% S NA P Inter active, Inc. US D STV I O T C BB 1 0. 7 1 .0 0 1 .0 % -1. 0% 34 . 0% 12 .4 % 2 5. 0% -9. 1% S NM G lobal Holdings US D S NMN O T C PK 0. 0 0 .0 0 -66 . 7% 15 0. 0% - 99. 3 % -9 9. 8% -1 00 .0 % -1 00 .0 % S ocial Me dia V enures , Inc. US D S MV I O T C PK 0. 0 1 .2 5 -12 . 0% 17. 9% - 12. 6 % 4 00. 0 % NM -75 . 0% S park Ne tworks , Inc. US D LO V A ME X 5 3. 6 2 .5 0 -2. 0% 1 .6 % - 13. 8 % -4 1. 5% -47. 0% -50 . 5% S pectrumDNA, Inc. US D S P XA O T C 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 10 ,8 14 .3 46 .6 5 -3. 4% 5 .4 % 12 . 4% -2 7. 5% -5. 4% -35 . 3% T he P ar ent C ompany US D K IDS . Q O T C PK 0. 6 0 .0 2 -23 . 3% -3 4. 3% - 97. 2 % -9 8. 8% -99. 5% -99 . 5% T he 9 Limited US D NC T Y Na sdaqGS 365 . 0 13 .2 2 -8. 8% -1 5. 8% 22 . 9% -2 9. 0% -38. 6% -53 . 6% T he S tre et.com, I nc. US D TSCM Na sdaqGM 6 7. 7 2 .2 3 -14 . 2% -2 3. 4% - 26. 4 % -6 8. 6% -75. 4% -78 . 7% T ree . C om, Inc. US D TR EE Na sdaqGM 3 7. 3 3 .9 8 1 .8 % -6. 4% 1 07 .3 % -4 7. 6% NM -64 . 1% Unis e rve C ommunications C or p. CAD T S X V: US S T S XV 1. 0 0 .0 5 -37 . 5% -9. 1% - 72. 2 % -8 0. 0% -87. 8% -88 . 9% Unite d Online Inc. US D UNT D Na sdaqGS 390 . 8 4 .7 6 -8. 3% -2 0. 4% - 21. 7 % -5 5. 9% -52. 3% -61 . 9% UOMO Medi a, I nc US D UOMO O T C BB 6. 8 0 .0 8 0 .0 % -2 0. 0% - 44. 8 % -7 8. 4% -88. 2% -90 . 0% VO IS , Inc. US D VO IS O T C BB 5. 4 0 .7 5 8 7. 5% 15 0. 0% 0. 0% -8 1. 3% NM -86 . 6% W ebzen Inc. US D WZE N Na sdaqGM 1 3. 4 1 .1 3 -24 . 8% -9. 8% 38 . 6% -5 6. 6% -66. 2% -74 . 7% W izz a rd S oftwa re C orporation US D WZE A ME X 2 9. 3 0 .6 5 -11 . 0% -6. 1% - 35. 0 % -5 2. 2% -76. 4% -77 . 3% W oozyF ly, Inc. US D WZY F O T C BB 2. 6 0 .1 5 0 .0 % 0 .0 % NM NM NM -96 . 3% W orlds .com Inc. US D WD DD O T C BB 9. 4 0 .1 8 -10 . 0% 12. 5% 28 . 6% -3 7. 9% -45. 5% -60 . 0% W ynds torm C orporation US D WY ND O T C BB 2. 2 0 .1 2 -4. 0% 0 .0 % - 40. 0 % -8 0. 0% NM -85 . 9% XI NG A G E UR O1 BC XT R A 205 . 5 31 .0 0 4 .2 % 8 .4 % 24 . 0% -1 0. 3% -23. 4% -33 . 5% Ye dangO nline C orp. KRW A0 527 70 K OS E 6 9. 4 6, 63 0 -9. 2% -6. 5% 20 . 5% -2 5. 9% -29. 9% -47 . 2% Ynk K or ea Inc. KRW A0 237 70 K OS E 6. 7 4, 10 0 -11 . 4% 3 .8 % - 24. 2 % -5 7. 9% -78. 4% -79 . 4% ZipL ocal Inc. CAD T S X V: ZIP T S XV 0. 3 0 .0 1 -75 . 0% -7 5. 0% - 75. 0 % -9 5. 0% -96. 6% -97 . 7% High 11 3. 3% 15 0. 0% 7 41 .7 % 4 00. 0 % 6 3. 6% 0 .0 % Low -75 . 0% -7 5. 0% - 99. 3 % -9 9. 8% -1 00 .0 % -1 00 .0 % Average 333.1 -9.9% -3.7% 5.6% -38.8% -52.4% -65.8% Medi an -9. 1% -5. 1% 0. 0% -4 7. 6% -57. 3% -68 . 8% Figure 25. Price Performance Source. Capital IQ
    • Page 18 C omparable Company Analys is > Web 2.0 V aluation Multiples P ri mary U S D Mar ket 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 xcha nge Ti cker C ap ($ m) R ev enue R e venue E B I TDA E B IT DA P /L TM E P S P /NT M E P S P /TangB V Acce lerize N ew Media, Inc. O T C BB AC L Z 8.3 4 .0 x - - - - - - Actoz S oft C o. , Ltd. K OS E A0 52 790 65 . 2 0 .9 x - 4 .7 x - 1 3. 7x - 1. 4x AQ Inte ractive, Inc. TS E 3 83 8 18 . 3 - - - - - - 0. 3x As s ociated Me dia Holdings Inc. O T C PK A S MH 0.2 10. 2 x - - - - - - Bigs tring C orp. O T C BB B SGC 0.7 28. 9 x - - - - - - Bright T hings plc A IM A IM: B GT 3.3 13. 4 x - - - - - - BroadW ebA s ia Inc. O T C PK B W BA 85 . 7 - - - - - - - C DC C orp. Na sdaqGS C HIN .A 85 . 2 0 .3 x 0. 4x 7 .5 x 6 .1 x - 11 .1 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 83 271 . 8 5 .9 x - 12. 4 x - 1 6. 8x - 5. 5x 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 117 . 7 0 .7 x - 4 .6 x - 7. 2x - - DXN Holdings Bhd K LS E DXN 20 . 0 0 .5 x - 3 .9 x - 3. 9x - 0. 4x Digita lP os t Interactive, Inc. O T C BB DG LP 0.5 3 .6 x - - - - - - Digita lT own, Inc. O T C BB DG T W 65 . 2 - - - - - - - Dolphin Digita l Me dia , Inc. O T C BB DP DM 24 . 2 - - - - - - - E olith C o. Ltd. K OS E A0 41 060 18 . 3 1 .1 x - - - - - - E xtensions, Inc. O T C PK E XT I 14 . 2 - - - - - - - F ina ncia l Me dia Group, Inc. O T C BB F NGP 2.1 0 .2 x - 1 .0 x - - - - F luid Mus ic C anada , Inc. TS X T S X: F MN 21 . 0 1 .9 x 1. 3x - - - - 1. 7x F rogs te r Inte ractive P icture s A G XT R A FRG 12 . 1 2 .3 x - - - - - 1. 2x Ga mania Digital E nterta inme nt C o. , L td. GTSM 6 18 0 94 . 3 0 .6 x - 3 .8 x - 1 1. 0x - 1. 5x Ga meO n C o L td. TS E 3 81 2 92 . 9 0 .4 x - 1 .6 x - 9. 1x - 1. 2x Ge oS entric O yj HL S E G E O1 V 45 . 6 7 .7 x - - - - - 7. 0x Giant Inte ractive G roup, Inc. NY S E GA 1 , 438 . 1 - - - - 1. 3x 12 .6 x 0. 3x GigaMe dia L td. Na sdaqGS G IGM 325 . 8 1 .3 x 1. 3x 5 .4 x 5 .0 x 9. 6x 8. 9x 3. 1x GoF is h C orporation O T C BB G OF H 3.2 2 .2 x - - - - - - Gravity C o., Ltd Na sdaqGM GRVY 19 . 5 - - - - - - - Gree, Inc. TS E T S E :3 63 2 1 , 116 . 5 33. 9 x - - - - - 16 . 6x GungHo Online E nte rtainme nt, Inc. OSE 3 76 5 135 . 7 1 .0 x - 6 .9 x - - - 40 . 3x HanbitS oft, Inc. K OS E A0 47 080 49 . 4 0 .7 x - - - - - 1. 8x IA C /Inte rA ctive C orp. Na sdaqGS IA C I 2 , 102 . 2 0 .2 x 0. 3x 5 .4 x 2 .1 x 1 5. 7x 24 .3 x 1. 0x IA S E ne rgy, Inc. O T C BB IAS C . A 1.5 - - - - - - - IdeaE dge, Inc. O T C BB OT C B B :IDAE 16 . 9 - - - - - - 12 . 4x is ee media Inc. T S XV IE E 3.3 0 .6 x - - - - - 1. 1x J umbuck E ntertainme nt P ty Ltd. ASX A S X: J MB 12 . 8 0 .8 x - 1 .8 x - 7. 1x - 1. 6x J umpT V Inc. TS X T S X :J T V 36 . 4 3 .9 x - - - - - 2. 6x Ka boos e Inc. TS X T S X: K AB 42 . 6 0 .8 x 0. 7x 11. 0 x 5 .5 x - - - Kings oft C o. Ltd. S E HK 3 88 8 383 . 5 2 .8 x - 8 .2 x - 1 1. 3x - 2. 5x 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 21 . 6 - - - - 3. 1x - 0. 7x Magnitude Informa tion S ys tems Inc. O T C BB MAG Y 7.9 - - - - - - - Mixi, Inc. TS E 2 12 1 594 . 8 3 .9 x - 10. 3 x - 2 7. 6x - 4. 5x Mode rn T imes Group Mtg A B OM MT G B 840 . 3 0 .9 x 0. 8x 5 .4 x 5 .8 x 2. 6x 5. 7x - Moggle , Inc O T C BB MMOG 72 . 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 A0 95 660 217 . 0 1 .7 x - 6 .4 x - 1 3. 3x - 7. 8x NetDra gon We bS oft, Inc. S E HK 7 77 190 . 9 0 .1 x - 0 .3 x - 5. 4x - 1. 1x Netea s e. com Inc. Na sdaqGS NT E S 2 , 292 . 5 - - - - 1. 7x 10 .0 x 0. 5x NeXplore C orporation O T C PK NXP C 27 . 9 - - - - - - - Ngi G roup Inc. TS E 2 49 7 22 . 4 - - - - 6. 3x - 0. 3x Northgate T e chnologies L imited B SE 59 00 57 27 . 0 0 .2 x - 1 .1 x - 1. 8x - - Open T e xt C orp. Na sdaqGS OTEX 1 , 657 . 7 2 .3 x 2. 1x 9 .2 x 8 .0 x 3 3. 9x 12 .5 x - Openwa ve S ys tems Inc. Na sdaqGS OPW V 68 . 3 - - - - - 27 .3 x 0. 9x Pe rfect W orld C o., Ltd. Na sdaqGS PW R D 696 . 0 - - - - 1. 1x 5. 8x 0. 4x PhotoC hannel Ne tworks Inc. T S XV T S XV : PN 52 . 5 3 .8 x 2. 3x - 7 .0 x - 31 .1 x 18 . 5x Quepas a C orp. Na sdaqC M QP S A 17 . 7 - - - - - - 7. 3x 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 , 218 . 9 - - - - 2. 0x 11 .5 x 1. 0x S hutterfly, Inc. Na sdaqGS S F LY 188 . 0 0 .5 x 0. 5x 3 .4 x 3 .1 x 4 2. 3x - 1. 1x S K C ommunications C o. , Ltd. K OS E A0 66 270 185 . 1 1 .3 x - 14. 2 x - - - - S NA P Inter active, Inc. O T C BB S TV I 10 . 7 4 .2 x - 41. 2 x - 5 9. 1x - 7. 8x 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 L OV 53 . 6 0 .8 x - 4 .2 x - 5. 4x - - S pectrum DNA, Inc. O T C BB S PX A 4.9 - - - - - - 5. 2x T encent Holdings Ltd. S E HK 7 00 10 , 814 . 3 12. 9 x - 26. 1 x - 3 5. 4x - 14 . 0x T he P ar ent C om pany O T C PK KIDS .Q 0.6 0 .2 x - - - - - - T he 9 Limited Na sdaqGS NC T Y 365 . 0 - - - - 1. 0x 6. 7x 0. 1x T he S tre et.com, Inc. Na sdaqGM T SCM 67 . 7 - - - - 7 1. 8x - 0. 7x T ree . C om, Inc. Na sdaqGM TR E E 37 . 3 0 .2 x 0. 2x - - - - 0. 6x Unis e rve C ommunications C orp. T S XV T S XV : US S 1.0 0 .1 x - 31. 3 x - - - - Unite d Online Inc. Na sdaqGS UNT D 390 . 8 1 .0 x 0. 7x 4 .5 x 3 .0 x - 7. 3x - 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 ebz en Inc. Na sdaqGM WZE N 13 . 4 - - - - - - 0. 0x W izz a rd S oftwa re C orporation A ME X W ZE 29 . 3 4 .7 x - - - - - - W ooz yF ly, Inc. O T C BB W ZY F 2.6 - - - - - - - W orlds .com Inc. O T C BB W DDD 9.4 - - - - 3. 4x - - W ynds torm C orporation O T C BB W Y ND 2.2 - - - - - - - XING A G XT R A O 1B C 205 . 5 3 .8 x - 9 .8 x - 2 0. 5x - 5. 6x Ye dangO nline C orp. K OS E A0 52 770 69 . 4 1 .5 x - 6 .7 x - 8. 8x - 4. 1x Ynk K or ea Inc. K OS E A0 23 770 6.7 0 .5 x - - - - - - ZipL ocal Inc. T S XV T S X V: ZIP 0.3 0 .3 x - - - - - - High 10 , 814 . 3 33. 9 x 2. 3x 41. 2 x 8 .0 x 7 1. 8x 31 .1 x 40 . 3x Low 0.0 0 .0 x 0. 2x 0 .1 x 2 .1 x 1. 0x 5. 7x 0. 0x Average 333.1 3.6x 1.0x 8.2x 5.1x 14.6x 13.4x 4.4x Median 27 . 0 1 .1 x 0. 7x 5 .4 x 5 .5 x 8. 8x 11 .1 x 1. 4x Figure 26. Valuation Comparison Source. Capital IQ
    • 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 ($m) E B IT DA % 37 18 , 399 . 2 2, 299. 9 3 , 120 . 5 1, 38 3.5 4 9.9% U nited S tates C h ina C hina U nited S ta tes C hina C hina 10 3 , 371 . 5 840. 3 2 , 691 . 1 23 9. 7 4 6.0% C an ada Un ite d S tate s S weden C hina S we den A us tra lia 9 1 , 980 . 5 330. 1 1 , 499 . 2 18 4. 5 2 9.3% S outh K o re a J apan J apa n S we den C a na da T a iwa n 8 1 , 811 . 3 230. 6 885 . 5 13 2. 9 2 5.7% C hina C a nada T a iwa n C ana da U nited S tates J a pa n 6 840 . 3 181. 1 509 . 1 13 2. 0 2 3.1% J a pa n S wede n C a na da J apa n J apan U nite d S tate s T a iwa n 3 T a iwa n 691 . 9 Ita ly 117. 7 S outh K orea 482 . 0 T aiwan 8 3.6 I ndia 1 7.6% 2 643 . 8 108. 8 428 . 1 5 6.1 1 6.0% A us tra lia S outh K orea G erma ny Hong K ong S outh K o re a S wede n 2 217 . 6 91. 1 344 . 7 3 4.5 1 6.0% G erma ny G erma ny U nited S tates T aiwa n Ita ly I ta ly 1 117 . 7 85. 2 216 . 0 2 3.8 1 3.3% Ma lay s ia I ta ly Hong K ong Italy India M a la ys ia 1 85 . 2 71. 5 135 . 5 1 8.8 1 3.1% Hon g K ong Ho ng K on g S outh K o re a India Hong K ong R uss ia 1 45 . 6 45. 6 131 . 7 1 7.2 5 . 8% F inla nd F inland F inla nd R us s ia R us s ia S outh K orea 1 41 . 6 41. 6 76 . 0 1 2.4 4 . 4% Ita ly R u ss ia R us s ia Ma la ysia G erma ny Hong K on g 1 27 . 0 27. 0 45 . 1 1 0.1 -10 . 9% U nited K ingdom I ndia In dia G erman y Ma lays ia G erm any 1 20 . 0 20. 0 11 . 4 2.7 -19 . 1% In dia M ala ys ia Ma lay s ia Austra lia A us tra lia C a nada S weden 1 A us tralia 14 . 9 A us tralia 7. 4 F in la nd 5 .2 U nited K ingdom -1.6 U nite d K ingdom N/A 1 3.3 3. 3 0 .2 -1 2.0 N/A R us s ia Un ite d K in gdom U nited K ingdom U nited K ingdom F in lan d F inla nd 85 28 ,311.5 333. 1 10 ,581 .4 2,31 8.2 17.8% G rand Total G rand T ota l G ra nd Total G rand Total G rand T otal G ra nd Tota l Figure 27. Comparison by Country Source. Capital IQ C omparable C ompany Analys is > Web 2.0 S ummary by Exc hange C ompany Na me US D Market C a p ($ 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 ($m) E B IT DA % 20 11 , 388 . 7 3, 796. 2 1 , 499 . 2 1, 19 7.7 6 9.0% OTCB B S E HK S E HK OM Na s da qG S OTCB B 11 10 , 390 . 4 1, 438. 1 478 . 7 53 0. 1 6 3.5% Nas da qG S Na sdaqG S NY S E Nas da qG S S E HK NY S E 8 1 , 844 . 8 944. 6 368 . 6 23 9. 7 4 6.0% OTCP K TS E Na s da qG S S E HK OM AS X 7 1 , 438 . 1 840. 3 245 . 2 15 5. 7 4 4.0% K OS E NY S E OM NY S E NY S E S E HK 5 840 . 3 369. 0 216 . 0 11 6. 2 3 2.0% TS E OM TS E CM TSE GTS M Nas da qG M 5 K OSE 611 . 0 G TSM 183. 1 BS E 135 . 5 K OS E 5 1.8 TS E 2 7.8% 5 366 . 1 135. 7 131 . 7 3 5.6 2 6.7% T S XV GTS M OSE RTS GTSM Na sda qG S 3 252 . 2 117. 7 107 . 9 3 4.5 1 9.5% S E HK OTCB B CM OSE CM A ME X 3 217 . 6 108. 8 84 . 4 2 3.8 1 7.6% TS X XTR A XT R A Nas da qG M BSE BSE 2 159 . 5 87. 3 80 . 2 1 7.2 1 6.0% A ME X Na sdaqG M K OS E TSE RTS OM 2 135 . 7 45. 6 76 . 0 1 5.8 1 6.0% XT R A OS E HL S E KLSE OSE CM 2 129 . 8 41. 6 72 . 1 1 2.4 1 4.7% ASX OTCP K RTS GTSM XT R A OS E 2 117 . 7 41. 5 61 . 5 1 0.1 1 3.3% GTSM CM A ME X KOS E K LS E K LS E 1 100 . 0 33. 3 33 . 1 5.2 1 3.1% K LS E TS X TS X AM E X A ME X R TS HLS E 1 A ME X 83 . 0 Na s da qG M 31. 9 TSX 25 . 0 ASX 2.7 K OSE 6 . 2% 1 66 . 4 27. 0 22 . 5 -1.6 0 . 9% OSE T S XV BSE XT R A A IM Na sda qG M 1 45 . 6 20. 0 21 . 0 -5.8 -3 . 9% CM HL S E K LS E OT C PK TSX TS X 1 41 . 6 17. 7 9 .0 -1 1.8 -10 . 9% B SE RTS Na s da qC M TSXV Na s da qC M XTR A 1 27 . 0 16. 2 5 .7 -1 1.9 -19 . 9% Nas da qC M BS E OTCP K AS X TSXV T S XV 1 20 . 0 13. 3 5 .2 -1 2.0 -29 . 4% NY S E K LS E T S XV HLS E HL S E OTCP K 1 17 . 7 12. 6 1 .7 -1 7.4 N/A A IM Na sdaqC M OTCB B OT C BB Na s da qG M A IM 1 14 . 9 7. 4 0 .2 -2 7.2 N/A OM AS X ASX AI M OTCPK Na sda qC M 1 3.3 3. 3 0 .1 -4 2.4 N/A R TS A IM A IM Nas da qC M OTCBB HL S E 85 28 ,311.5 333. 1 133 .9 2,31 8.2 17.8% G rand Total G rand T ota l G ra nd Total G rand Total G rand T otal G ra nd Tota l Figure 28. Comparison by Exchange Source. Capital IQ
    • Page 20 Financing - La st Three Months (US$ m) Month Company Name Country Angel/Seed Debt financing PIPE Se ries A Series B Series C Series D Series E Grand Total US A 22. 5 22 .5 Dec -0 8 G oFi sh Canada 11 .1 11 .1 NetS helter US A 10.5 10 .5 Blue Kai UK 9.9 9.9 Ta ptu FooMojo US A 9. 9 9.9 S cri bd US A 9.0 9.0 S uperfish I sra el 5.3 5.3 Ta gged US A 5.0 5.0 US A 5.0 5.0 S napmyl ife US A 5.0 5.0 Jac kbe I ndia 5.0 5.0 ChakPak US A 4.5 4.5 Tumbl r S wede n 4. 3 4.3 P laydo Canada 3. 8 3.8 O verlay. TV US A 2. 0 2.0 DotBl u US A 1.0 1.0 Angie's Lis t S toc kTwi ts US A 0. 8 0.8 Dec -0 8 Total 5.0 22. 5 31 .9 49.2 1.0 5.0 114.6 US A 13.0 13 .0 Jan-09 Y odle US A 12.5 12 .5 AdMob US A 12.0 12 .0 Aster Data S ystem s France 11.4 11 .4 V irtuOz K orea 10 .0 10 .0 Nurie n US A 10.0 10 .0 I MV U US A 10.0 10 .0 NewsG ator DE CA US A 10.0 10 .0 G o Internet Media US A 10 .0 10 .0 Rate Point US A 10.0 10 .0 O ne True Media US A 9.0 9.0 I sra el 8. 0 8.0 S undayS ky US A 8.0 8.0 P lay Hard S ports US A 7.5 7.5 JibJa b US A 7.0 7.0 X obni US A 6.5 6.5 I nsideVie w France 6.2 6.2 Kewego US A 6.0 6.0 Fl iqz US A 6.0 6.0 Motionbox US A 6.0 6.0 S ocialMedi a US A 5.0 5.0 S portsblogs US A 5.0 5.0 G eni AboutUs US A 5. 0 5.0 G box US A 5. 0 5.0 E -G lobal Sports Network US A 3. 5 3.5 m Ego US A 2.5 2.5 A ust ria 2. 5 2.5 Tri pwolf UK 1. 2 1.2 Hubdub US A 1.0 1.0 S nooth Canada 1.0 1.0 CoveritLiv e Canada 0.2 0.2 I denti.c a US A Meez Jan-09 Total 4.7 45 .2 68.9 82.2 10.0 211.0 US A 35.0 35 .0 Feb-0 9 Tw itter S outh Af rica 20.0 20 .0 S ynthasi te US A 18.0 18 .0 Tremor Media US A 15.0 15 .0 O fferpa l Media US A 12.5 12 .5 E mer gent Ga me Technologie s I sra el 12.0 12 .0 O utbrain France 9.0 9.0 Tv tri p US A 5.6 5.6 O odl e US A 4. 3 4.3 Te xtDi gger US A 4. 2 4.2 O neSpot Mix po Canada 4.0 4.0 Fe tc hDog US A 4. 0 4.0 V irtual Fair ground Netherland s 4.0 4.0 7 Billion P eople US A 3. 0 3.0 US A 2. 3 2.3 W histl eBox US A 2. 0 2.0 O utright I sra el 1. 6 1.6 Tv inci US A 1. 4 1.4 Fi ltrbox US A 1. 3 1.3 Cake Financial UK 0. 7 0.7 fav.or. it Feb-0 9 Total 4.0 24 .8 60.0 58.6 12.5 159.9 Gr and Total 8.7 5.0 22. 5 101.9 178.1 141.8 5.0 22.5 485.4 Figure 29. Financing, Last Three Months Source. Company reports
    • 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