0
Web 2.0 Weekly
                                      “Financing on pace for record month”
                                ...
Key Developments (past week)
    Deals (M&A, Finance)
     Salesforce.com acquired crowd-sourced personal contact service,...
Key Developments cont.
    Financial Results cont.
                                              Fiscal Period
Company    ...
Public Company Data




4                         www.mackieresearch.com
Aggregate Public Data

     Web 2.0 Public Companies   Total      Median    Max           Min
    # Companies             ...
6
                                                                      0
                                                ...
Valuation Dashboard – 1 Week
                           Market Cap                            EV/Revenue
                 ...
8
                         Source: CapitalIQ
                                                                             ...
9
                         Source: CapitalIQ
                                                                             ...
10
                         Source: CapitalIQ
                                                                            ...
11
                                                                      -
                                               ...
12
                                                                                    0.0
                               ...
13
                                                                                                            0.0
       ...
10 04-27 web 2.0 weekly
10 04-27 web 2.0 weekly
10 04-27 web 2.0 weekly
10 04-27 web 2.0 weekly
10 04-27 web 2.0 weekly
10 04-27 web 2.0 weekly
10 04-27 web 2.0 weekly
10 04-27 web 2.0 weekly
10 04-27 web 2.0 weekly
10 04-27 web 2.0 weekly
10 04-27 web 2.0 weekly
10 04-27 web 2.0 weekly
10 04-27 web 2.0 weekly
10 04-27 web 2.0 weekly
10 04-27 web 2.0 weekly
10 04-27 web 2.0 weekly
10 04-27 web 2.0 weekly
10 04-27 web 2.0 weekly
10 04-27 web 2.0 weekly
10 04-27 web 2.0 weekly
10 04-27 web 2.0 weekly
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10 04-27 web 2.0 weekly

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April on track to be record month?: Total transaction value in the Web 2.0 universe April-to-date is $726.1 million. The number of financings stands at 40 averaging $18.2 million each. Note that this includes the $300 million investment in DST by Tencent. Even excluding this transaction, the average is $15.2 million. In comparison, total capital raised in March was $168.1 million, averaging $5.4 million over 31 deals. The highest monthly total in our Web 2.0 financing database was April 2008 with a total of $765.5 million raised in 47 transactions.





Deal round-up for April: The large deal highlights for the month include:

§

•Tencent invested $300mm in DST (investor in Facebook, Zynga, Groupon).
DST invested $135mm in social-shopping service Groupon.
Salesforce.com acquired crowd-sourced personal contact service, Jigsaw, for $142 mm.
•Warner Bros. acquired gaming company, Turbine, for $160 mm.
•Ankeena Networks, media infrastructure solution provider was acquired by Juniper for $100mm.
Bullish week for Web 2.0: Sixty-nine percent of the companies in our universe had increased or flat market caps over the past week, sixty-nine percent had increased EV/Revenue multiples, 75% had increased or flat EV/EBITDA multiples and 73% had increased or flat P/E mutliples .

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Transcript of "10 04-27 web 2.0 weekly"

  1. 1. Web 2.0 Weekly “Financing on pace for record month” April 27, 2010 David Shore, CFA, MBA 416.860.6784 dshore@mackieresearch.com Damian Wojcichowsky, CFA 416.860.7652 This report has been created by Analysts that are employed by Mackie Research Capital Corporation, a Canadian Investment Dealer. For further disclosures, please see last page of this report. www.mackieresearch.com Copyright © 2000-2010, Mackie Research Capital Corporation, All rights reserved www.mackieresearch.com
  2. 2. Key Developments (past week) Deals (M&A, Finance) Salesforce.com acquired crowd-sourced personal contact service, Jigsaw, for $142 mm. Warner Bros. acquired gaming company, Turbine, for $160 mm. Diapers.com, internet retailer, received $20 mm in funding (lifetime financing total = $59 mm). Financial Results/Guidance Points International Ltd. (TSX:PTS) revised 2010 revenue guidance. The company expects 2010 revenue in the range of $85-$95 mm (following on a prior guidance increase from $60-$70 mm to $75-$85 mm). CDC Corp. (NasdaqGS:CHIN.A) announced preliminary Q1/10 application sales to increase by approximately 14% to $8.2 mm from $7.2 mm in Q1/09. Total Non-GAAP recurring revenue (which CDC defines as Non-GAAP maintenance plus SaaS revenue) is expected to increase by ~13% to $27.4 mm in Q1/10 from $24.2 mm in Q1/09. First quarter 2010 license revenue is expected to be $7.9 mm, and Total Contract Value for new SaaS contracts secured in the quarter is expected to be about $300,000. 2 www.mackieresearch.com
  3. 3. Key Developments cont. Financial Results cont. Fiscal Period Company (ended) Revenue (current/prior year) Y/Y % EPS (current/prior year) Y/Y % Modern Times Group Mtg AB (OM:MTG B) Q1/10 (Mar. 2010) SEK 3,524mm (SEK 3,336mm) 5.6% SEK 4.60 (SEK 2.19) 110.0% Multiplied Media Corporation (TSXV:MMC) F2009 (Dec. 2009) $288,537 ($69,768) 313.6% ($0.04) (loss $0.011) NM The New York Times Company (NYSE:NYT) Q1/10 (Mar. 2010) $587.9mm ($607.1mm) -3.2% $0.08 (loss $0.52) NM Frogster Interactive Pictures AG (XTRA:FRG) F2009 (Dec. 2009) €14.7mm NA €0.96 per share NA Sohu.com Inc. (NasdaqGS:SOHU) Q1/10 (Mar. 2010) $129.5mm ($115.6mm) 12.0% $0.73 NA Changyou.com Limited (NasdaqGS:CYOU) Q1/10 (Mar. 2010) $72.0mm ($61.6mm) 16.9% $0.80 per ADS ($0.72 per ADS) 11.1% 3 www.mackieresearch.com
  4. 4. Public Company Data 4 www.mackieresearch.com
  5. 5. Aggregate Public Data Web 2.0 Public Companies Total Median Max Min # Companies 99 - - - Market Cap (US$ mm) 86,002.5 80.2 38,752.5 1.7 Revenue (US$ mm) 22,695.3 60.4 3,257.4 0.0 1 Year revenue growth 4.8% 1178.9% -91.4% EBITDA as % of revenue - 11.4% 67.7% -91.9% Net cash (US$ mm) 8,270.2 1.2 1,754.9 -732.7 TEV/Revenue - 2.0x 45.2x 0.1x TEV/EBITDA - 9.6x 46.2x 0.1x P/E - 14.8x 76.6x 0.0x Relative to 52 week high -29.5% 5.6% -98.1% Source: CapitalIQ 5 www.mackieresearch.com
  6. 6. 6 0 5 10 15 20 25 30 Gaming 27 Social Networking 16 Media 10 7 Diversified 6 Marketing 5 Mobile Source: CapitalIQ 3 Infrastructure 3 SMS/Voice 3 Enterprise 3 Advertising 2 Internet Retail 2 Virtual World By Sector 2 Dating 2 Music 1 Vertical Communities 1 Collaboration 1 Podcasting 1 Learning 1 Video 1 Search 1 Payment 1 Financial Services Public Company Distribution 0 5 10 15 20 25 30 35 40 45 United States Canada China South Korea Japan Taiwan Germany Australia United Kingdom Hong Kong Poland Russia By Country Finland Sweden Malaysia India Italy Switzerland Israel www.mackieresearch.com
  7. 7. Valuation Dashboard – 1 Week Market Cap EV/Revenue Flat Flat 4% 11% Falling 31% Falling 31% Rising 58% Rising 65% EV/EBITDA P/E Flat Flat 2% 0% Falling Falling 27% 25% Rising Rising 73% 73% 7 www.mackieresearch.com
  8. 8. 8 Source: CapitalIQ Multiple (x) 0.0x 0.5x 1.0x 1.5x 2.0x 2.5x 3.0x 3.5x 4.0x 4.5x 5.0x # companies 3/9/2009 3/16/2009 3/23/2009 3/30/2009 4/6/2009 4/13/2009 4/20/2009 4/27/2009 5/4/2009 5/11/2009 5/18/2009 5/25/2009 6/1/2009 6/8/2009 6/15/2009 6/22/2009 Median EV/Revenue 6/29/2009 7/6/2009 7/13/2009 7/20/2009 7/27/2009 8/3/2009 8/10/2009 8/17/2009 8/24/2009 8/31/2009 9/7/2009 Median 9/14/2009 9/21/2009 9/28/2009 10/5/2009 10/12/2009 10/19/2009 10/26/2009 11/2/2009 11/9/2009 11/16/2009 Long-term average 11/23/2009 11/30/2009 12/7/2009 12/14/2009 12/21/2009 12/28/2009 1/4/2010 1/11/2010 1/18/2010 1/25/2010 2/1/2010 2/8/2010 recovering but 2/15/2010 below LT Average Revenue multiples 2/22/2010 3/1/2010 3/8/2010 3/15/2010 3/22/2010 3/29/2010 4/5/2010 4/12/2010 4/19/2010 4/26/2010 373838393939404039424243444545444546484949485051545558585860636363626363676867697168646969697172747776797777787779818381 www.mackieresearch.com
  9. 9. 9 Source: CapitalIQ Multiple (x) # companies 0.0x 5.0x 10.0x 15.0x 20.0x 25.0x 3/9/2009 3/16/2009 3/23/2009 3/30/2009 4/6/2009 4/13/2009 4/20/2009 4/27/2009 5/4/2009 5/11/2009 5/18/2009 5/25/2009 6/1/2009 6/8/2009 Median EV/EBITDA 6/15/2009 6/22/2009 6/29/2009 7/6/2009 7/13/2009 7/20/2009 7/27/2009 8/3/2009 8/10/2009 8/17/2009 8/24/2009 8/31/2009 9/7/2009 Median 9/14/2009 9/21/2009 9/28/2009 10/5/2009 10/12/2009 10/19/2009 10/26/2009 11/2/2009 11/9/2009 11/16/2009 11/23/2009 Long-term average 11/30/2009 12/7/2009 12/14/2009 12/21/2009 12/28/2009 1/4/2010 1/11/2010 1/18/2010 1/25/2010 2/1/2010 below LT average remain depressed 2/8/2010 2/15/2010 EV/EBITDA multiples 2/22/2010 3/1/2010 3/8/2010 3/15/2010 3/22/2010 3/29/2010 4/5/2010 4/12/2010 4/19/2010 4/26/2010 2120 2022 22 2323 2222 2424 2323 2424 26 2626 2625 2526 2628 28 2930 3334 3639 3738 3738 39 3737 3740 4139 4041 41 4041 4245 4443 4949 4850 50 5049 4846 www.mackieresearch.com
  10. 10. 10 Source: CapitalIQ Multiple (x) # companies 0.0x 5.0x 10.0x 15.0x 20.0x 25.0x 30.0x 3/9/2009 3/16/2009 3/23/2009 Median P/E 3/30/2009 4/6/2009 4/13/2009 4/20/2009 4/27/2009 5/4/2009 5/11/2009 5/18/2009 5/25/2009 6/1/2009 6/8/2009 6/15/2009 6/22/2009 6/29/2009 7/6/2009 7/13/2009 7/20/2009 7/27/2009 8/3/2009 8/10/2009 8/17/2009 8/24/2009 8/31/2009 9/7/2009 Median 9/14/2009 9/21/2009 9/28/2009 10/5/2009 10/12/2009 10/19/2009 10/26/2009 11/2/2009 11/9/2009 11/16/2009 11/23/2009 Long-term average 11/30/2009 12/7/2009 12/14/2009 12/21/2009 12/28/2009 1/4/2010 1/11/2010 1/18/2010 1/25/2010 2/1/2010 2/8/2010 below LT average 2/15/2010 P/E multiples also 2/22/2010 3/1/2010 3/8/2010 3/15/2010 3/22/2010 3/29/2010 4/5/2010 4/12/2010 4/19/2010 4/26/2010 1719 1919 18 1819 1919 2020 1918 1919 20 2021 2524 2525 2526 26 2729 3029 3031 3032 3435 36 3636 3637 3839 3737 37 3635 3632 3130 3333 3333 33 3333 3231 www.mackieresearch.com
  11. 11. 11 - 5.0 10.0 15.0 20.0 25.0 # Companies 2 Infrastructure 6 Diversified 3 SMS/Voice 7 Social Networking 2 Music 1 Vertical Communities 4 Mobile 5 Marketing 1 Learning Gaming 21 1 Podcasting 1 Collaboration EV/Revenue 1 Search 3 Advertising 1 Video 2 Internet Retail 3 Enterprise 2 Dating 9 Media 1 Financial Services 1 Virtual World - 5.0 10.0 15.0 20.0 25.0 30.0 35.0 40.0 45.0 50.0 Average Valuation – by Sector # Companies 1 Search 2 Enterprise 5 Diversified 1 Mobile 6 Media 1 Collaboration 2 Internet Retail 5 Social Networking EV/EBITDA Gaming 13 1 Financial Services 3 Marketing 1 Dating 1 Advertising www.mackieresearch.com
  12. 12. 12 0.0 5.0 10.0 15.0 20.0 25.0 30.0 35.0 40.0 45.0 50.0 Ngi Group Inc. Cyberplex Inc. Jumbuck Entertainment Limited RealNetworks Inc. Source: CapitalIQ Tree.Com, Inc. GameOn Co Ltd. Actoz Soft Co., Ltd. Uniserve Communications Corp. GigaMedia Ltd. Glu Mobile, Inc. Openwave Systems Inc. Northgate Technologies Limited DADA SpA Points International Ltd. Internet Group SA IAC/InterActiveCorp. AOL, Inc. 0.20.2 0.40.40.4 0.50.50.50.6 0.60.70.70.70.80.80.80.90.9 CDC Corp. United Online, Inc. CornerWorld Corporation The New York Times Company TheStreet.com, Inc. Beyond Commerce, Inc. OAO RBC Information Systems AQ Interactive, Inc. Hutchison Telecommunications Hong EV/Revenue Ranking HanbitSoft, Inc. infoGROUP, Inc. Gamania Digital Entertainment Co., Ltd. Spark Networks, Inc. YD Online Corp. ValueClick, Inc. NetDragon WebSoft, Inc. 1.0 1.0 1.0 1.0 1.2 1.2 1.2 1.3 1.3 1.3 1.4 1.4 1.5 1.6 1.6 1.7 Ynk Korea Inc. Score Media Inc. Shutterfly, Inc. 1.9 2.02.0 SNAP Interactive, Inc. PNI Digital Media Inc. Oriented Media Group Berhad XING AG Velti Plc UOMO Media, Inc Modern Times Group Mtg AB NeuLion Incorporated Webzen Inc. GungHo Online Entertainment, Inc. 2.22.22.3 2.32.32.4 2.42.6 2.72.9 Sohu.com Inc. SK Communications Co., Ltd. Myriad Group AG Open Text Corp. NEOWIZ Games Corporation Wizzard Software Corporation 3.0 3.13.23.2 3.4 3.5 iseemedia Inc. Taleo Corp. 4.34.8 NeXplore has highest Lingo Media Corporation DigitalPost Interactive, Inc. revenue multiple at 45.2x WebMediaBrands Inc 5.0 5.1 5.5 Kingsoft Corporation Limited Accelerize New Media, Inc. Changyou.com Limited 5.7 5.86.4 Unilava Corporation 6.6 Mixi, Inc. 7.8 Frogster Interactive Pictures AG 9.1 Fluid Music Canada, Inc. Gree, Inc. 10.3 TransGaming, Inc. 12.0 HUGHES Telematics, Inc. 12.0 Chinese Gamer International 13.4 15.4 GeoSentric Oyj Paid Inc. 18.1 MOKO.mobi Limited 19.5 Tencent Holdings Ltd. 23.3 Bright Things plc 30.7 SpectrumDNA, Inc. 44.1 NeXplore Corporation 45.2 www.mackieresearch.com
  13. 13. 13 0.0 5.0 10.0 15.0 20.0 25.0 30.0 35.0 40.0 45.0 50.0 Cyberplex Inc. GameOn Co Ltd. Source: CapitalIQ AOL, Inc. Actoz Soft Co., Ltd. 1.9 2.0 2.7 2.7 United Online, Inc. Hutchison Telecommunications Hong Kong Holdings Ltd. ValueClick, Inc. The New York Times Company 4.7 5.1 5.7 5.7 Sohu.com Inc. Spark Networks, Inc. DADA SpA YD Online Corp. infoGROUP, Inc. EV/EBITDA Ranking Gamania Digital Entertainment Co., Ltd. 6.7 6.9 6.9 7.0 7.6 7.8 CDC Corp. XING AG NetDragon WebSoft, Inc. PNI Digital Media Inc. 8.0 8.4 8.4 8.9 Changyou.com Limited Tree.Com, Inc. Uniserve Communications Corp. 9.3 9.8 10.1 Velti Plc 11.1 Score Media Inc. Open Text Corp. NEOWIZ Games Corporation GungHo Online Entertainment, Inc. 11.9 11.9 12.0 12.3 Kingsoft Corporation Limited IAC/InterActiveCorp. 13.2 13.9 the group at 46.2x HanbitSoft, Inc. Shutterfly, Inc. 14.6 14.9 SK Communications leads Openwave Systems Inc. 15.1 Ynk Korea Inc. Modern Times Group Mtg AB 16.3 17.2 Gree, Inc. 17.5 Mixi, Inc. 21.7 Chinese Gamer International 24.7 Taleo Corp. 32.4 TheStreet.com, Inc. 35.1 Tencent Holdings Ltd. SK Communications Co., Ltd. 45.5 46.2 www.mackieresearch.com Excluding EV/EBITDA > 100x
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