Web 2.0 Weekly - June 16, 2010: "Endless Money for Online Gaming?"
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Web 2.0 Weekly - June 16, 2010: "Endless Money for Online Gaming?"

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June financing ahead of average: Financing in the Web 2.0 universe in June continued to be strong with total transaction value (excluding M&A) month-to-date of $291.8 million from 29 transactions, ...

June financing ahead of average: Financing in the Web 2.0 universe in June continued to be strong with total transaction value (excluding M&A) month-to-date of $291.8 million from 29 transactions, averaging $10.1 million each - led by the Zynga financing. In comparison, total capital raised in June 2009 was $225.2 million, averaging $4.6 million over 49 deals. Excluding Dec 09 and Apr 10, the average monthly total is $260 million.

Deals (M&A, Finance)
888 Holdings acquired online gaming company Mytopia for $18 mm.

In the second largest financing overall this year, Zynga (online gaming) raised another $147 mm from Softbank, bringing its total financing to $381 mm.

Financial Results/Guidance
Cyberplex Inc. (TSX:CX) completed the acquisition of Tsavo Media, Inc. from Fountainhead Estate Holding Corp., American Capital Equity I of American Capital Equity Management LLC, and others on June 8, 2010.

NetDragon WebSoft, Inc. (SEHK:777), announced first quarter revenues of RMB 139,476,000 compared to RMB 173,898,000 for the same period a year ago. Profit before taxation was RMB 21,379,000 compared to RMB 53,502,000 for the same period a year ago. Profit for the period attributable to owners of the company was RMB 21,215,000 compared to RMB 48,943,000 for the same period a year ago. Diluted EPS was 4.03 cents compared to 9.31 cents for the same period a year ago.

Gravity Co., Ltd (NasdaqGM:GRVY) reported net income attributable to parent company was $337 million or $0.05 per share on total net revenues of $9,840 million compared to net income attributable to parent company of $4,649 million or $0.67 per share on total net revenues of $14,696 million for the same period a year ago.

Positive price performance
The Web 2.0 public company universe rose this week, with 56% of companies seeing their market cap rise vs. 36% falling and 8% flat.

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Web 2.0 Weekly - June 16, 2010: "Endless Money for Online Gaming?" Web 2.0 Weekly - June 16, 2010: "Endless Money for Online Gaming?" Presentation Transcript

  • Web 2.0 Weekly “Funds for Online Gaming Appear Endless” June 16, 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
  • Key Developments (past week) Deals (M&A, Finance) – Online Gaming Continues to Attract Significant Money 888 Holdings acquired online gaming company Mytopia for $18 mm. In the second largest financing overall this year, Zynga (online gaming) raised another $147 mm from Softbank, bringing its total financing to $381 mm. Financial Results/Guidance Cyberplex Inc. (TSX:CX) completed the acquisition of Tsavo Media, Inc. from Fountainhead Estate Holding Corp., American Capital Equity I of American Capital Equity Management LLC, and others on June 8, 2010. NetDragon WebSoft, Inc. (SEHK:777), announced first quarter revenues of RMB 139,476,000 compared to RMB 173,898,000 for the same period a year ago. Profit before taxation was RMB 21,379,000 compared to RMB 53,502,000 for the same period a year ago. Profit for the period attributable to owners of the company was RMB 21,215,000 compared to RMB 48,943,000 for the same period a year ago. Diluted EPS was 4.03 cents compared to 9.31 cents for the same period a year ago. Gravity Co., Ltd (NasdaqGM:GRVY) reported net income attributable to parent company was $337 million or $0.05 per share on total net revenues of $9,840 million compared to net income attributable to parent company of $4,649 million or $0.67 per share on total net revenues of $14,696 million for the same period a year ago. 2 www.mackieresearch.com
  • Public Company Data 3 www.mackieresearch.com
  • Aggregate Public Data Web 2.0 Public Companies Total Median Max Min # Companies 101 - - - Market Cap (US$ mm) 75,829.5 69.8 29,926.5 1.7 Revenue (US$ mm) 23,428.4 56.6 3,057.7 0.0 1 Year revenue growth 6.7% 8961.6% -100.0% EBITDA as % of revenue - 12.8% 63.1% -63.7% Net cash (US$ mm) 8,998.7 2.3 1,825.8 -670.8 TEV/Revenue - 1.9x 45.2x 0.0x TEV/EBITDA - 8.5x 43.7x 0.0x P/E - 16.4x 89.2x 0.0x Relative to 52 week high -39.2% -2.0% -95.6% Source: CapitalIQ 4 www.mackieresearch.com
  • 5 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
  • Valuation Dashboard – 1 Week Market Cap EV/Revenue Flat Flat 8% 4% Falling Falling 59% 36% Rising 56% Rising 37% EV/EBITDA P/E Flat Flat 4% 0% Falling Falling 55% 53% Rising 43% Rising 45% 6 www.mackieresearch.com
  • 7 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 4/28/2009 5/5/2009 5/12/2009 5/19/2009 5/26/2009 6/2/2009 6/9/2009 6/16/2009 6/23/2009 6/30/2009 7/7/2009 7/14/2009 7/21/2009 7/28/2009 8/4/2009 8/11/2009 Median EV/Revenue 8/18/2009 8/25/2009 9/1/2009 9/8/2009 9/15/2009 9/22/2009 9/29/2009 10/6/2009 10/13/2009 10/20/2009 10/27/2009 Median 11/3/2009 11/10/2009 11/17/2009 11/24/2009 12/1/2009 12/8/2009 12/15/2009 12/22/2009 12/29/2009 1/5/2010 Long-term average 1/12/2010 1/19/2010 1/26/2010 2/2/2010 2/9/2010 2/16/2010 2/23/2010 3/2/2010 3/9/2010 3/16/2010 LT average 3/23/2010 flat with prior 3/30/2010 week, well below 4/6/2010 Revenue multiples 4/13/2010 4/20/2010 4/27/2010 5/4/2010 5/11/2010 5/18/2010 5/25/2010 6/1/2010 6/8/2010 6/15/2010 384040414141414343454646474747485051505150535656616161646666676464666970717174717168707472757679798180818080828285838584 www.mackieresearch.com
  • 8 Source: CapitalIQ Multiple (x ) # companies 0. 0x 5. 0x 10. 0x 15. 0x 20. 0x 25. 0x 30. 0x 4/28/2009 5/5/2009 5/12/2009 5/19/2009 5/26/2009 6/2/2009 6/9/2009 6/16/2009 6/23/2009 6/30/2009 7/7/2009 7/14/2009 7/21/2009 7/28/2009 Median EV/EBITDA 8/4/2009 8/11/2009 8/18/2009 8/25/2009 9/1/2009 9/8/2009 9/15/2009 9/22/2009 9/29/2009 10/6/2009 10/13/2009 10/20/2009 10/27/2009 Median 11/3/2009 11/10/2009 11/17/2009 11/24/2009 12/1/2009 12/8/2009 12/15/2009 12/22/2009 12/29/2009 1/5/2010 1/12/2010 Long-term average 1/19/2010 1/26/2010 2/2/2010 2/9/2010 2/16/2010 2/23/2010 3/2/2010 3/9/2010 3/16/2010 below LT average 3/23/2010 3/30/2010 and remain depressed 4/6/2010 EV/EBITDA multiples drop 4/13/2010 4/20/2010 4/27/2010 5/4/2010 5/11/2010 5/18/2010 5/25/2010 6/1/2010 6/8/2010 6/15/2010 20 21 22 23 23 22 22 23 24 23 25 23 24 26 26 26 26 26 25 26 27 28 33 29 34 35 37 38 40 40 39 38 41 41 41 39 39 42 43 42 43 42 43 43 43 43 46 45 44 50 51 50 52 53 53 51 51 49 53 51 www.mackieresearch.com
  • 9 Source: CapitalIQ Multiple (x ) # companies 0. 0x 5. 0x 10. 0x 15. 0x 20. 0x 25. 0x 30. 0x 35. 0x 4/28/2009 5/5/2009 5/12/2009 Median P/E 5/19/2009 5/26/2009 6/2/2009 6/9/2009 6/16/2009 6/23/2009 6/30/2009 7/7/2009 7/14/2009 7/21/2009 7/28/2009 8/4/2009 8/11/2009 8/18/2009 8/25/2009 9/1/2009 9/8/2009 9/15/2009 9/22/2009 9/29/2009 10/6/2009 10/13/2009 10/20/2009 10/27/2009 Median 11/3/2009 11/10/2009 11/17/2009 11/24/2009 12/1/2009 12/8/2009 12/15/2009 12/22/2009 12/29/2009 1/5/2010 1/12/2010 Long-term average 1/19/2010 1/26/2010 2/2/2010 2/9/2010 2/16/2010 2/23/2010 3/2/2010 3/9/2010 3/16/2010 3/23/2010 3/30/2010 4/6/2010 below LT average P/E multiples also 4/13/2010 4/20/2010 4/27/2010 5/4/2010 5/11/2010 5/18/2010 5/25/2010 6/1/2010 6/8/2010 6/15/2010 20 19 18 18 19 19 19 19 20 20 19 18 19 19 20 21 24 24 25 25 26 27 29 27 30 32 33 31 34 34 35 36 38 39 39 39 40 40 41 42 40 40 40 39 38 38 34 33 32 35 35 35 36 35 35 33 35 32 34 33 www.mackieresearch.com
  • 10 - 5.0 10.0 15.0 20.0 25.0 # Companies 2 Infrastructure 2 Music 7 Social Networking 1 Learning 5 Diversified 1 Vertical Communities 4 Mobile 3 SMS/Voice 6 Marketing Gaming 21 1 Search 1 Collaboration EV/Revenue 9 Media 3 Advertising 1 Podcasting 1 Video 2 Internet Retail 3 Enterprise 2 Dating 1 Financial Services 1 Virtual World - 2.0 4.0 6.0 8.0 10.0 12.0 14.0 16.0 18.0 20.0 Average Valuation – by Sector # Companies 1 Mobile 2 Enterprise 5 Diversified 2 Internet Retail 6 Media 1 Collaboration 5 Social Networking EV/EBITDA Gaming 14 3 Marketing 1 Dating 1 Advertising www.mackieresearch.com
  • 11 0. 0 5. 0 10. 0 15. 0 20. 0 25. 0 30. 0 35. 0 40. 0 45. 0 50. 0 NeXplore C orporation 45.2 Worlds .c om Inc. 33.0 B right T hings plc 29.2 S pectrumDNA, Inc . 23.7 Source: CapitalIQ MO K O . mobi Limited 17.9 T enc ent H oldings L td. 15.6 G eoS entric O y j 15.2 P aid Inc. 12.7 B ey ond C ommerc e, Inc. 11.4 G ree, Inc. 10.1 C hines e G amer International L ingo Media C orporation 9.69.5 Dena C o. L td. T rans G aming, Inc. 7.9 7.6 7.4 DigitalP os t Interactiv e, Inc. HU G H E S T elematic s , Inc . Ac celeriz e New Media, Inc . 5.5 5.3 WebMediaB rands Inc F luid Mus ic C anada, Inc. C hangyou. com Limited S K C ommunic ations C o. , Ltd. 4.84.74.4 4.1 3.8 T aleo C orp. Mix i, Inc. is eemedia Inc. K ings oft C orporation Limited Wiz z ard S oftware C orporation F rogs ter Interac tiv e P ic tures AG 3.53.23.2 3.13.0 eP ro Ltd. EV/Revenue Ranking U O MO Media, Inc O pen T ex t C orp. NE O WIZ G ames C orporation Modern T imes G roup Mtg AB P NI Digital Media Inc. S ohu.c om Inc. XING AG V elti P lc Webz en Inc . S c ore Media Inc. 2.82.62.62.42.32.22.22.12.12.12.0 S hutterfly , Inc . V alueC lick , Inc. G ungHo O nline E ntertainment, Inc. U nilav a C orporation My riad G roup AG P latforma Mediowa P oint G roup S . A. Y D O nline C orp. NeXplore has highest S park Network s , Inc. NeuLion Inc orporated revenue multiple at 45.2x H anbitS oft, Inc . G amania Digital E ntertainment C o., Ltd. H utc his on T elecommunic ations H ong S NAP Interac tive, Inc . O riented Media G roup B erhad 1.9 1.9 1.8 1.8 1.7 1.7 1.5 1.5 1.5 1.51.4 1.4 1.4 1.3 1.3 infoG R O U P , Inc . O AO R B C Information S ys tems C ornerWorld C orporation Internet G roup S A T he New Y ork T imes C ompany AQ Interactive, Inc. T heS treet.c om, Inc . IAC /InterActiv eC orp. NetDragon WebS oft, Inc. United O nline, Inc . Y nk K orea Inc . C DC C orp. Unis erv e C ommunications C orp. AO L, Inc . P oints International L td. DADA S pA G igaMedia L td. G lu Mobile, Inc . 1.0 1.0 1.0 0.90.80.80.80.80.80.80.8 0.70.70.70.60.60.60.6 Northgate T echnologies Limited O penwav e S y s tems Inc . T ree. C om, Inc. Actoz S oft C o. , Ltd. C y berplex Inc. J umbuc k E ntertainment L imited R ealNetwork s Inc. G ameO n C o Ltd. As k net AG L ook S mart, L td. 0.40.40.30.30.30.20.20.10.0 www.mackieresearch.com
  • 12 0.0 5.0 10.0 15.0 20.0 25.0 30.0 35.0 40.0 45.0 50.0 S K C ommunic ations C o. , L td. 43. 7 H anbitS oft, Inc . 33.2 Source: CapitalIQ T enc ent H oldings L td. 30. 0 T aleo C orp. 28. 4 C hines e G amer International F rogs ter Interactive P ic tures AG 18.9 18. 8 G ree, Inc. My riad G roup AG Modern T imes G roup Mtg AB Dena C o. L td. 17.5 17.416.616.6 O penwave S y s tems Inc . Mix i, Inc. T heS treet.c om, Inc . S hutterfly , Inc. 15.0 14.814. 614.5 EV/EBITDA Ranking AQ Interac tive, Inc. S c ore Media Inc. Y D O nline C orp. 13. 0 12. 912.7 IAC /InterAc tiveC orp. P latforma Mediowa P oint G roup S . A. 10. 5 9. 8 O pen T ex t C orp. P NI Digital Media Inc. G amania Digital E ntertainment C o., L td. the group at 43.7x NE O WIZ G ames C orporation XING AG SK Communications leads V elti P lc 9. 2 8.9 8. 6 8. 5 8.5 8. 3 G ungH o O nline E ntertainment, Inc . DADA S pA U nis erve C ommunic ations C orp. K ings oft C orporation L imited S park Network s , Inc. C hangy ou.c om L imited V alueC lic k , Inc. 8.0 7.8 7.7 7.6 7. 5 7.0 6. 8 infoG R O U P , Inc . C DC C orp. 6. 7 6. 6 H utc his on T elec ommunications H ong K ong H oldings T he New Y ork T imes C ompany S ohu.c om Inc. NetDragon WebS oft, Inc. 5. 5 5.4 5.2 4.4 United O nline, Inc . C y berplex Inc. 4.0 3.2 AO L , Inc . Ac toz S oft C o., L td. 2.2 1. 8 G ameO n C o L td. J umbuc k E ntertainment L imited 0.8 0. 6 www.mackieresearch.com Excluding EV/EBITDA > 100x
  • 13 0.0 10.0 20.0 30.0 40.0 50.0 60.0 70.0 80.0 90.0 100.0 Source: CapitalIQ S hutterfly, Inc . 89.2 P oints International L td. C DC C orp. 50.8 50. 1 infoG R O UP , Inc . Mix i, Inc . P/E Ranking 46. 8 46. 1 O pen T ex t C orp. T enc ent H oldings L td. Dena C o. L td. 40.4 40.0 G ree, Inc . 36.0 34.2 G amania Digital E ntertainment C o., L td. 31.2 V elti P lc C hines e G amer International 26.1 25. 4 F rogs ter Interac tive P ic tures AG NetDragon WebS oft, Inc . NE O WIZ G ames C orporation 21. 6 20. 3 19.9 Hutchis on T elec ommunic ations Hong K ong Holdings L td. Shutterfly has the T he New Y ork T imes C ompany highest P/E at 89.2x V alueC lick , Inc . 17.1 16.4 15.9 S ohu.c om Inc . C y berplex Inc . K ings oft C orporation L imited 14.0 13.4 13. 1 DADA S pA AO L , Inc. C hangy ou.c om L imited U nited O nline, Inc. 11. 6 11. 1 10.2 9.6 G ameO n C o L td. 9. 1 U nis erve C ommunic ations C orp. 6. 2 J umbuck E ntertainment L imited 3. 5 Neteas e.c om Inc. 2.1 G iant Interac tive G roup, Inc . 2.1 S handa Interac tive E ntertainment L td. 1.9 P erfec t World C o. , L td. 1.2 www.mackieresearch.com
  • 14 Source: CapitalIQ (U S $m) # companies - 10,000 20,000 30,000 40,000 50,000 60,000 70,000 80,000 90,000 100,000 6/23/2009 6/30/2009 7/7/2009 7/14/2009 7/21/2009 7/28/2009 8/4/2009 8/11/2009 8/18/2009 8/25/2009 9/1/2009 9/8/2009 9/15/2009 9/22/2009 9/29/2009 10/6/2009 10/13/2009 10/20/2009 10/27/2009 11/3/2009 11/10/2009 11/17/2009 Total Market Capitalization 11/24/2009 98 98 98 98 98 98 98 98 98 98 98 98 98 98 98 99 99 99 99 99 99 99100 12/1/2009 12/8/2009 100100 12/15/2009 12/22/2009 100100 12/29/2009 1/5/2010 1/12/2010 100 1/19/2010 1/26/2010 100100 100100 2/2/2010 2/9/2010 100100 2/16/2010 2/23/2010 3/2/2010 101 Total market cap drops to $75.5 bn 3/9/2010 3/16/2010 100101 101101 3/23/2010 3/30/2010 4/6/2010 101 4/13/2010 4/20/2010 101101 101101 4/27/2010 5/4/2010 101101 5/11/2010 5/18/2010 5/25/2010 101 6/1/2010 6/8/2010 101101 101101 6/15/2010 101 www.mackieresearch.com
  • 15 - # Companies 5,000.0 10,000.0 15,000.0 20,000.0 25,000.0 30,000.0 35,000.0 40,000.0 8 Diversified Gaming 28 Media 10 Social Networking 16 1 Collaboration 6 Marketing 3 Enterprise 2 Internet Retail 1 Search 5 Mobile Total Market Cap – by Sector 3 SMS/Voice 2 Music 2 Dating 1 Financial Services 2 Virtual World 3 Advertising 1 Video 1 Vertical Communities Eight Diversified companies 1 Payment totaling over $34 bn in market cap 1 Podcasting 3 Infrastructure 1 Learning www.mackieresearch.com
  • 16 0 1,000 2,000 3,000 4,000 5,000 6,000 Tencent Holdings Ltd. Dena Co. Ltd. Netease.com Inc. Modern Times Group Mtg AB Source: CapitalIQ Gree, Inc. IAC/InterActiveCorp. Shanda Interactive Entertainment Ltd. AOL, Inc. Open Text Corp. Sohu.com Inc. Giant Interactive Group, Inc. Changyou.com Limited The New York Times Company Perfect World Co., Ltd. Hutchison Telecommunications Hong Kong Holdings Taleo Corp. ValueClick, Inc. Chinese Gamer International NEOWIZ Games Corporation SK Communications Co., Ltd. Mixi, Inc. Shutterfly, Inc. Kingsoft Corporation Limited United Online, Inc. RealNetworks Inc. infoGROUP, Inc. Gamania Digital Entertainment Co., Ltd. Velti Plc CDC Corp. GungHo Online Entertainment, Inc. NetDragon WebSoft, Inc. Myriad Group AG Openwave Systems Inc. Market Cap Ranking XING AG OAO RBC Information Systems GigaMedia Ltd. Webzen Inc. Fluid Music Canada, Inc. The9 Limited HUGHES Telematics, Inc. TheStreet.com, Inc. AQ Interactive, Inc. GameOn Co Ltd. Points International Ltd. HanbitSoft, Inc. Actoz Soft Co., Ltd. Tree.Com, Inc. Spark Networks, Inc. Paid Inc. DADA SpA Score Media Inc. YD Online Corp. Frogster Interactive Pictures AG PNI Digital Media Inc. Ngi Group Inc. NeuLion Incorporated Moggle, Inc Platforma Mediowa Point Group S.A. Gravity Co., Ltd Quepasa Corp. Glu Mobile, Inc. WebMediaBrands Inc Cyberplex Inc. DigitalTown, Inc. ePro Ltd. TransGaming, Inc. dominates group GeoSentric Oyj Multiplied Media Corporation Socialwise, Inc. LookSmart, Ltd. VOIS, Inc. Asknet AG Tencent’s $30 bn market cap Ynk Korea Inc. NeXplore Corporation Accelerize New Media, Inc. Wizzard Software Corporation Lingo Media Corporation Youblast Global, Inc. Dolphin Digital Media, Inc. Northgate Technologies Limited iseemedia Inc. Unilava Corporation MOKO.mobi Limited Jumbuck Entertainment Limited Internet Group SA Kent International Holdings Inc. DigitalPost Interactive, Inc. Bright Things plc Beyond Commerce, Inc. SNAP Interactive, Inc. Worlds.com Inc. Kiwibox.Com, Inc. En2Go International, Inc. SpectrumDNA, Inc. IAS Energy, Inc. Oriented Media Group Berhad Uniserve Communications Corp. UOMO Media, Inc CornerWorld Corporation BroadWebAsia Inc. Mobile Data Corp. www.mackieresearch.com
  • Price Performance – 1 Week • Positive price momentum, with 55% of stocks rising over the past week. Price Momentum Falling 36% Rising Flat 55% 9% 17 www.mackieresearch.com
  • Average Price Performance – 1 Week, by Sector 30.0% 26.6% Dating sector shows 20.0% highest weekly returns 10.1% 9.8% 9.5% 10.0% 7.3% 4.9% 4.6% 4.2% 3.4% 3.2% 1.6% 1.0% 0.9% 0.0% -1.2% -2.0% -2.1% -3.2% -4.8% -10.0% -6.1% -20.0% -16.1% -21.9% -24.0% -30.0% Internet Retail Infrastructure Networking Collaboration Virtual World Financial Payment Communities Advertising Learning Music Dating Podcasting Enterprise Marketing Gaming Mobile Diversified Search Services Media SMS/Voice Video Social Vertical Source: CapitalIQ 18 www.mackieresearch.com
  • 19 -80.0% -60.0% -40.0% -20.0% 0.0% 20.0% 40.0% 60.0% 80.0% UNLA BWBA MBYL GEO1V WDDD Source: CapitalIQ TSXV:LM BYOC NXPC SPXA DPDM 700 SEHK:8086 GRVY QPSA TSXV:TNG WSE:PGM AIM:BGT OMEDIA SNDA LOOK TSX:FMN A066270 IEE HUTC 6180 3812 SCLW 2121 KOSE:A069080 NCTY TSE:2432 SHHD OTEX A052790 GTSM:3083 A023770 CWRL IUSA KIWB ETGI MYRN ASX:JMB DGTW DB:M0C TSE:3632 VEL 777 SEHK:215 Price Performance – 1 Week RBCI 3888 O1BC WSE:IGR CM:DA TSX:PTS GA PAYD 3838 ACLZ DGLP NTES GLUU TSX:SCR XTRA:A5A SOHU LOV A052770 WEBM TSX:NLN 3765 TREE RNWK TSXV:MMC IACI 590057 A095660 TSX:CX TSCM GIGM AOL CYOU UNTD VCLK A047080 KNTH TSXV:PN WZE OPWV SFLY FRG MTG B TLEO 2497 CHIN.A PWRD IASC.A NYT UOMO MKB STVI TSXV:USS VOIS www.mackieresearch.com
  • 20 0% 20% 40% 60% 80% 100% 120% 140% 160% 0% 500% 1000% 1500% 2000% 2500% OAO RBC Youblast Global, Information Inc. Systems Mobile Data ePro Ltd. Source: CapitalIQ Corp. AQ Interactive, Beyond Inc. Commerce, Inc. Beyond Velti Plc Commerce, Inc. Uniserve Communications Gree, Inc. Corp. 6 Month 1 Month SNAP iseemedia Inc. Interactive, Inc. AQ Interactive, Velti Plc Inc. Uniserve Score Media Inc. Communications Corp. SK MOKO.mobi Communications Limited Co., Ltd. NEOWIZ Games Dena Co. Ltd. Corporation Price Performance (Top 10) 0% 20% 40% 60% 80% 100% 120% 140% 160% 0% 500% 1000% 1500% 2000% 2500% 3000% 3500% 4000% OAO RBC Beyond Commerce, Information Inc. Systems Quepasa ePro Ltd. Corp. ePro Ltd. LookSmart, Ltd. SK Communications Velti Plc Co., Ltd. Dena Co. Ltd. Glu Mobile, Inc. 1 Year 3 Month Fluid Music DigitalTown, Inc. Canada, Inc. TransGaming, Velti Plc Inc. Frogster Interactive Youblast Global, Inc. Pictures AG Modern Times Dena Co. Ltd. Group Mtg AB Hutchison Telecommunications Gree, Inc. Hong Kong Holdings Ltd. www.mackieresearch.com
  • 21 -70.0% -60.0% -50.0% -40.0% -30.0% -20.0% -10.0% 0.0% -100.0% -90.0% -80.0% -70.0% -60.0% -50.0% -40.0% -30.0% -20.0% -10.0% 0.0% Dolphin Digital Actoz Soft Media, Inc. Co., Ltd. SpectrumDNA, Source: CapitalIQ Mixi, Inc. Inc. Kiwibox.Com, NeXplore Inc. Corporation Beyond Cyberplex Inc. Commerce, Inc. Unilava Lingo Media Corporation Corporation 1 Week 6 Month NeXplore Worlds.com Corporation Inc. SpectrumDNA, GeoSentric Oyj Inc. En2Go Mobile Data International, Corp. Inc. CornerWorld BroadWebAsia Corporation Inc. BroadWebAsia Unilava Inc. Corporation -90.0% -80.0% -70.0% -60.0% -50.0% -40.0% -30.0% -20.0% -10.0% 0.0% Price Performance (Bottom 10) -120.0% -100.0% -80.0% -60.0% -40.0% -20.0% 0.0% Wizzard Dolphin Digital Software Media, Inc. Corporation SpectrumDNA, Quepasa Corp. Inc. Lingo Media Cyberplex Inc. Corporation IAS Energy, Paid Inc. Inc. CornerWorld SpectrumDNA, Corporation Inc. 1 Year 1 Month UOMO Media, NeXplore Inc Corporation Youblast BroadWebAsia Global, Inc. Inc. Beyond CornerWorld Commerce, Corporation Inc. En2Go IAS Energy, International, Inc. Inc. BroadWebAsia Unilava Inc. Corporation www.mackieresearch.com
  • Capital Market Activity (Financing, M&A) 22 www.mackieresearch.com
  • Financing Activity – Current Month C om pany Nam e C ountr y S e ctor Ac quis ition Ange l/S e e d De bt financ ing S e rie s A S e r ie s B S e r ie s C S e rie s D NA Gr and Total Zynga US A Gaming 147. 0 147.0 Invite Me dia US A A naly tic s 70. 0 70. 0 Fe tc hBac k US A A dvertis ing 40. 0 40. 0 Haute L ook US A Internet R etail 31. 0 31. 0 C halle nge Gam e s US A Gaming 20. 5 20. 5 Mytopia Is rael Gaming 18. 0 18. 0 Mar in S oftw ar e US A A dvertis ing 11. 2 11. 2 Roc k You US A Widget 10. 0 10. 0 Book Re nte r US A S oc ial Commerc e 10.0 10. 0 Mac hinim a.c om US A V irtual World 9. 0 9. 0 T rans pe r a US A Mobile A d 7. 0 7. 0 Kudz u Inte r ac tive US A Financial S ervices 7. 0 7. 0 C ur s e US A S oc ial Netw orks 6. 0 6. 0 Adis n US A A dvertis ing 5. 5 5. 5 C onnotate US A A naly tic s 5. 3 5. 3 Me tacafe US A V ideo 5. 0 5. 0 BigDoor Me dia US A Media 5. 0 5. 0 Be ac hMint US A S oc ial Commerc e 5. 0 5. 0 S pons or Pay Germany V irtual G oods 4. 6 4. 6 L uc idMe dia US A A dvertis ing 4. 5 4. 5 Giiv US A S oc ial Commerc e 3. 4 3. 4 Attr ibutor US A A naly tic s 3. 2 3. 2 T re fis US A A naly tic s 3. 2 3. 2 Me tam ar k e ts US A A dvertis ing 2. 5 2. 5 S naptic US A Mobile 2. 3 2. 3 uC ir r us US A Inf ras truc ture 1. 7 1. 7 WOWIO US A Internet R etail 1. 7 1. 7 Dilithium Ne tw or k s US A V ideo 1. 5 1. 5 S choology US A Online L earning 1. 3 1. 3 T hum btack US A Crow ds ourc ed Content 1. 2 1. 2 S oGe o Netherlands L ocation-bas ed S NS 0. 8 0. 8 Rum m ble UK L ocation-bas ed S NS 0. 8 0. 8 T e am S nap US A V ertic al Communities 0. 7 0. 7 154.0 6.0 1.5 32.6 17.0 47.0 175.9 11.8 445.8 23 www.mackieresearch.com
  • Financing Activity – Current Month, by Sector $ Raised # Deals Social Social Commerce Other Internet Retail Commerce 4% 14% 7% 9% Internet Retail 6% Advertising 14% Advertising 15% Other 46% Analytics Gaming 18% 43% Analytics 15% Gaming 9% 24 www.mackieresearch.com
  • Financing Activity 1000.0 June financing remained strong with 16.0 over US$290 mm raised versus ~US$260 mm monthly total deal value average 14.1 900.0 14.0 800.0 12.2 12.0 700.0 10.3 9.8 10.1 10.0 600.0 8.9 (US$m) (US$m) 7.8 500.0 8.0 6.4 6.4 400.0 5.8 5.7 5.4 6.0 4.6 300.0 4.0 200.0 2.0 100.0 0.0 0.0 Jun-09 Jul-09 Aug-09 Sep-09 Oct-09 Nov-09 Dec-09 Jan-10 Feb-10 Mar-10 Apr-10 May-10 Jun-10 *Dec-09 includes $180m Zynga investment Apr-10 includes $300m DST investment Total Average Jun-10 includes $147m Zynga investment 25 www.mackieresearch.com
  • 26 (US$m) 0.0 50.0 100.0 150.0 200.0 250.0 300.0 350.0 400.0 450.0 500.0 # companies Gaming 13 1 Diversified 5 Collaboration 9 Mobile 8 Media Social 9 Commerce Crowdsourced 3 Content Advertising 15 the past quarter Analytics 14 area of interest in Gaming the biggest 8 Video 5 Internet Retail Social 8 Networks Financial 5 Services 5 Virtual World 2 Widget 4 Enterprise Vertical 9 Communities 5 Infrastructure Mobile 1 Payment 2 Virtual Goods 2 Mobile Ad Online 2 Learning 2 Music 1 Aggregation 3 Search 1 Classified 3 Travel Location- 4 based SNS 1 Microblog Capital Market Activity Ranking – by Sector, last three months 1 Micromedia 1 Blog www.mackieresearch.com
  • 27 (US$ mm) 0.0 100.0 200.0 300.0 400.0 500.0 600.0 700.0 Jan-08 Feb-08 Mar-08 Apr-08 May-08 Jun-08 Jul-08 Aug-08 Sep-08 Oct-08 Nov-08 Social Networks Dec-08 Jan-09 Feb-09 Gaming Mar-09 Apr-09 $ Raised May-09 Advertising Jun-09 Jul-09 Video Aug-09 Sep-09 Oct-09 Virtual World Nov-09 Dec-09 Jan-10 Feb-10 Mar-10 Apr-10 May-10 Jun-10 Top 5 Sectors (2008-present) (# Deals) 0 5 10 15 20 25 30 Jan-08 Feb-08 Mar-08 Apr-08 May-08 Jun-08 Jul-08 Aug-08 Sep-08 Oct-08 Nov-08 Dec-08 Social Networks Jan-09 Feb-09 Advertising Mar-09 Apr-09 May-09 Gaming # Deals Jun-09 Jul-09 Aug-09 Virtual World Sep-09 Oct-09 Video Nov-09 Dec-09 Jan-10 Feb-10 Mar-10 Apr-10 Top 5 sectors average $170 mm & 15 deals per month (aggregate) May-10 Jun-10 www.mackieresearch.com
  • Upcoming Events/Earnings Company Date Time Quarter Conf Call Details Tree.Com, Inc. (NasdaqGM:TREE) 29-Jul-10 11:00 AM (EST) Q2/10 877-874-1588 Source: CapitalIQ 28 www.mackieresearch.com
  • Public Company Listing T rading C urre nt US $ Mark e t C om pany Nam e T ick e r Exchange C ur re ncy HQ Price C ap (m m ) Em ploye e s A ccelerize New M edia, Inc. ACLZ OTCBB USD United States 1 15.9 10 A cto z So ft Co ., Ltd. A052790 KOSE KRW So uth Ko rea 10,700 77.2 NA A OL, Inc. AOL NYSE USD United States 22 2,309.4 6,700 A Q Interactive, Inc. 3838 TSE JP Y Japan 150,000 89.4 NA A sknet AG XTRA :A 5A XTRA EUR Germany 3 20.2 NA B eyo nd Co mmerce, Inc. BYOC OTCBB USD United States 0 6.0 16 B right Things plc AIM :B GT A IM GB P United Kingdo m 0 6.2 9 B roadWebA sia Inc. BWB A OTCPK USD United States 0 1.7 46 CDC Co rp. CHIN.A NasdaqGS USD Ho ng Ko ng 2 250.1 NA Changyo u.co m Limited CYOU NasdaqGS USD China 29 1 ,500.1 1,308 Chinese Gamer Internatio nal GTSM :3083 GTSM TWD Taiwan 279 741 .4 NA Co rnerWorld Co rpo ratio n CWRL OTCBB USD United States 0 1.9 16 Cyberplex Inc. TSX:CX TSX CA D Canada 1 37.9 NA DA DA SpA CM :DA CM EUR Italy 3 69.8 597 Dena Co . Ltd. TSE:2432 TSE JP Y Japan 2,869 4,486.5 NA DigitalPo st Interactive, Inc. DGLP OTCBB USD United States 0 6.8 6 DigitalTown, Inc. DGTW OTCBB USD United States 1 37.1 3 Do lphin Digital M edia, Inc. DP DM OTCBB USD United States 0 12.4 NA En2Go International, Inc. ETGI OTCBB USD United States 0 4.8 NA ePro Ltd. SEHK:8086 SEHK HKD Ho ng Ko ng 1 35.8 707 Fluid M usic Canada, Inc. TSX:FM N TSX CA D United States 2 1 07.9 NA Fro gster Interactive P ictures A G FRG XTRA EUR Germany 18 57.6 NA Gamania Digital Entertainment Co ., Ltd. 6180 GTSM TWD Taiwan 53 260.5 NA GameOn Co Ltd. 381 2 TSE JP Y Japan 77,900 85.1 NA Geo Sentric Oyj GEO1 V HLSE EUR Finland 0 33.2 120 Giant Interactive Gro up, Inc. GA NYSE USD China 7 1,658.5 NA GigaM edia Ltd. GIGM NasdaqGS USD Taiwan 2 1 33.4 NA Glu M o bile, Inc. GLUU NasdaqGM USD United States 1 41 .3 479 Gravity Co ., Ltd GRVY NasdaqGM USD So uth Ko rea 2 47.3 NA Gree, Inc. TSE:3632 TSE JP Y Japan 6,910 3,428.1 NA GungHo Online Entertainment, Inc. 3765 OSE JP Y Japan 189,500 238.4 NA HanbitSo ft, Inc. A047080 KOSE KRW So uth Ko rea 4,335 77.3 NA HUGHES Telematics, Inc. HUTC OTCBB USD United States 3 94.4 276 Hutchison Teleco mmunicatio ns Ho ng Kong Ho ldings Ltd. SEHK:21 5 SEHK HKD Ho ng Ko ng 2 1,025.8 1,732 IA C/InterActiveCo rp. IA CI NasdaqGS USD United States 23 2,604.7 3,200 IA S Energy, Inc. IA SC.A OTCPK USD Canada 0 4.1 NA infoGROUP , Inc. IUSA NasdaqGS USD United States 8 457.9 3,146 29 www.mackieresearch.com
  • Public Company Listing cont. T rading C urr e nt US $ Mark e t C om pany Nam e T ick e r Exc hange C ur re nc y HQ Price C ap (m m ) Em ploye e s iseemedia Inc. IEE TSXV CA D Canada 0.13 9.1 NA Jumbuck Entertainment Limited A SX:JM B A SX A UD A ustralia 0.20 8.4 79 Kent Internatio nal Ho ldings Inc. KNTH OTCP K USD United States 1.95 6.9 NA Kingso ft Co rpo ratio n Limited 3888 SEHK HKD China 4.22 590.7 2,735 Kiwibo x.Co m, Inc. KIWB OTCB B USD United States 0.01 5.0 6 Lingo M edia Co rpo ratio n TSXV:LM TSXV CA D Canada 0.50 14.2 NA Lo o kSmart, Ltd. LOOK NasdaqGM USD United States 1.36 23.3 65 M ixi, Inc. 2121 TSE JP Y Japan 388,500.00 658.6 NA M o bile Data Co rp. M B YL OTCB B USD United States 0.07 1.7 NA M o dern Times Gro up M tg A B M TG B OM SEK Sweden 452.00 3,843.8 2,936 M o ggle, Inc DB :M 0C DB EUR United States 0.85 48.9 2 M OKO.mo bi Limited M KB A SX A UD A ustralia 0.09 9.1 NA M ultiplied M edia Co rpo ratio n TSXV:M M C TSXV CA D Canada 0.12 29.2 NA M yriad Gro up A G M YRN SWX CHF Switzerland 4.40 189.1 NA NEOWIZ Games Co rpo ratio n A 095660 KOSE KRW So uth Ko rea 42,800.00 734.7 NA NetDrago n WebSo ft, Inc. 777 SEHK HKD China 3.37 227.6 2,901 Netease.co m Inc. NTES NasdaqGS USD China 31 .00 4,01 5.2 NA NeuLio n Inco rpo rated TSX:NLN TSX CA D Canada 0.45 51.1 224 NeXplo re Co rpo ratio n NXP C OTCP K USD United States 0.30 16.7 NA Ngi Gro up Inc. 2497 TSE JP Y Japan 40,750.00 55.4 NA No rthgate Techno lo gies Limited 590057 B SE INR India 16.05 12.0 160 OA O RB C Info rmatio n Systems RB CI M ICEX RUB Russia 38.48 166.1 2,523 Open Text Co rp. OTEX NasdaqGS USD Canada 39.78 2,258.7 3,700 Openwave Systems Inc. OP WV NasdaqGS USD United States 2.23 187.0 590 Oriented M edia Gro up B erhad OM EDIA KLSE M YR M alaysia 0.10 3.9 NA P aid Inc. P A YD OTCB B USD United States 0.26 70.5 20 P erfect Wo rld Co ., Ltd. P WRD NasdaqGS USD China 25.96 1,299.6 NA P latfo rma M edio wa P o int Gro up S.A . WSE:P GM WSE P LN P o land 1.52 47.9 NA P NI Digital M edia Inc. TSXV:P N TSXV CA D Canada 1.69 55.7 NA P o ints Internatio nal Ltd. TSX:P TS TSX CA D Canada 0.55 80.1 93 Quepasa Co rp. QP SA OTCB B USD United States 3.50 45.4 71 RealNetwo rks Inc. RNWK NasdaqGS USD United States 3.43 463.9 1,754 Yo ublast Glo bal, Inc. SHHD OTCB B USD United States 0.40 13.6 6 Sco re M edia Inc. TSX:SCR TSX CA D Canada 0.88 69.4 230 Shanda Interactive Entertainment Ltd. SNDA NasdaqGS USD China 40.50 2,404.8 5,721 30 www.mackieresearch.com
  • Public Company Listing cont. T rading C urr e nt US $ Mark e t C om pany Nam e T ick e r Exchange C ur re ncy HQ Price C ap (m m ) Em ploye e s SK Co mmunicatio ns Co ., Ltd. A 066270 KOSE KRW So uth Ko rea 19,900.00 683.9 NA SNA P Interactive, Inc. STVI OTCB B USD United States 0.18 5.9 15 So cialwise, Inc. SCLW OTCB B USD United States 0.48 24.0 NA So hu.co m Inc. SOHU NasdaqGS USD China 43.98 1,663.2 3,997 Spark Networks, Inc. LOV A M EX USD United States 3.57 73.5 155 SpectrumDNA , Inc. SP XA OTCB B USD United States 0.07 4.5 8 Taleo Co rp. TLEO NasdaqGM USD United States 25.59 1 7.5 ,01 91 6 Tencent Holdings Ltd. 700 SEHK HKD China 127.40 29,926.5 7,845 The New Yo rk Times Co mpany NYT NYSE USD United States 9.76 1 .1 ,421 7,665 The9 Limited NCTY NasdaqGS USD China 4.04 1 03.1 1 0 ,01 TheStreet.co m, Inc. TSCM NasdaqGM USD United States 2.95 93.1 274 TransGaming, Inc. TSXV:TNG TSXV CA D Canada 0.60 34.7 28 Tree.Com, Inc. TREE NasdaqGM USD United States 6.77 75.9 700 Unilava Co rpo ratio n UNLA OTCB B USD United States 0.09 9.1 40 Uniserve Communications Co rp. TSXV:USS TSXV CA D Canada 0.14 3.8 NA United Online, Inc. UNTD NasdaqGS USD United States 6.72 585.5 1,699 UOM O M edia, Inc UOM O OTCB B USD Canada 0.02 2.1 NA ValueClick, Inc. VCLK NasdaqGS USD United States 1 .74 1 954.8 1,086 Velti P lc VEL A IM GB P United Kingdom 4.53 252.0 459 VOIS, Inc. VOIS OTCB B USD United States 0.01 20.6 2 WebM ediaB rands Inc WEB M NasdaqGS USD United States 1.02 38.2 83 Webzen Inc. KOSE:A 069080 KOSE KRW So uth Ko rea 1 ,900.00 1 1 4.8 1 NA Wizzard So ftware Corpo ratio n WZE A M EX USD United States 0.22 14.6 80 Wo rlds.co m Inc. WDDD OTCB B USD United States 0.09 5.2 1 XING A G O1 C B XTRA EUR Germany 28.78 183.0 293 YD Online Co rp. A 052770 KOSE KRW So uth Ko rea 4,815.00 58.8 NA Ynk Ko rea Inc. A 023770 KOSE KRW So uth Ko rea 2,795.00 18.1 NA 31 www.mackieresearch.com
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