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Web 2.0 Weekly - May 11, 2010
 

Web 2.0 Weekly - May 11, 2010

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Slow start in May after record April: Total transaction value (excluding M&A) in the Web 2.0 universe for April was $813.5 million - the highest monthly total we have recorded. The number of ...

Slow start in May after record April: Total transaction value (excluding M&A) in the Web 2.0 universe for April was $813.5 million - the highest monthly total we have recorded. The number of financings was also a record, at 49, averaging $16.6 million each. Note that this includes the $300 million investment in DST by Tencent. Excluding this transaction, the average is $10.7 million. May 2010, in contrast, has started slowly, with only $37.4 million in financing announced thus far, averaging just $3.4 million across 11 deals. In comparison, total capital raised in May 2009 was $375.0 million, averaging $12.5 million over 30 deals.

Deal round-up for May: The large deal highlights for the month include:
Fluid Music (TSX:FMN, digital music distributor) will acquire Mood Media (provider of sensorial marketing solutions) for €160 mm.
Lithium is purchasing analytics developer, Scout Labs, for $20 mm.
Fatfoogoo (purveyor of virtual goods) is being acquired by Digital River for $10 mm.
Groupalia, the Spanish answer to online group discount retailers, Groupon and LivingSocial, raised $2.5 mm in a Series A financing – the online group discounters have been raising money quickly (DST invested $135 mm in Groupon in April) with a total of $222 mm in funding coming to just these three players thus far.

Bearish week again: Price performance was largely negative in our Web 2.0 universe, with prices dropping for over 70% of the companies.

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    Web 2.0 Weekly - May 11, 2010 Web 2.0 Weekly - May 11, 2010 Presentation Transcript

    • Web 2.0 Weekly “Fluid Music – Muzak’s Younger, Hipper Sibling” May 11, 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) – Group Deals and Muzak’s Younger, Hipper Sibling Fluid Music (TSX:FMN, digital music distributor) will acquire Mood Media (provider of sensorial marketing solutions) for €160 mm. Lithium is purchasing analytics developer, Scout Labs, for $20 mm. Fatfoogoo (purveyor of virtual goods) is being acquired by Digital River for $10 mm. Groupalia, the Spanish answer to online group discount retailers, Groupon and LivingSocial, raised $2.5 mm in a Series A financing – the online group discounters have been raising money quickly (DST invested $135 mm in Groupon in April) with a total of $222 mm in funding coming to just these three players thus far. Financial Results/Guidance RealNetworks (Internet veteran from the Web 1.0 era) reported Q1/F10 revenue of $128.6 mm (-9% Y/Y) and EPS of $0.05 (vs. $0.10 in Q1/F09). In terms of outlook, management expects Q2 revenue to decline Y/Y and Q/Q and EBITDA to be negative – though Q2 is expected to be the low point in financial performance for F2010. 2 www.mackieresearch.com
    • Public Company Data 3 www.mackieresearch.com
    • Aggregate Public Data Web 2.0 Public Companies Total Median Max Min # Companies 99 - - - Market Cap (US$ mm) 78,963.9 72.1 36,243.7 1.0 Revenue (US$ mm) 22,467.7 60.2 3,057.7 0.0 1 Year revenue growth 3.5% 857.0% -91.4% EBITDA as % of revenue - 13.4% 67.7% -75.0% Net cash (US$ mm) 8,591.6 1.8 1,754.4 -670.8 TEV/Revenue - 1.7x 46.4x 0.0x TEV/EBITDA - 8.5x 42.6x 0.0x P/E - 16.4x 93.4x 0.0x Relative to 52 week high -36.7% -3.8% -97.2% 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 10% 4% Rising 30% Rising 17% Falling 73% Falling 66% EV/EBITDA P/E Flat Flat 4% 3% Rising 26% Rising 32% Falling Falling 65% 70% 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 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 6/29/2009 7/6/2009 Median EV/Revenue 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 9/14/2009 9/21/2009 Median 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 11/30/2009 Long-term average 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 2/15/2010 2/22/2010 recovering, but 3/1/2010 below LT Average Revenue multiples 3/8/2010 3/15/2010 3/22/2010 3/29/2010 4/5/2010 4/12/2010 4/19/2010 4/26/2010 5/3/2010 5/10/2010 373737383939393939414344444545454648494949485154545858586163636461636367676867706667657072687372767477777777777980818181 www.mackieresearch.com
    • 8 Source: CapitalIQ Multiple (x) # companies 0.0x 5.0x 10.0x 15.0x 20.0x 25.0x 30.0x 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/EBITDA 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 9/14/2009 9/21/2009 Median 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 11/30/2009 12/7/2009 Long-term average 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 2/15/2010 below LT average remain depressed 2/22/2010 3/1/2010 EV/EBITDA multiples 3/8/2010 3/15/2010 3/22/2010 3/29/2010 4/5/2010 4/12/2010 4/19/2010 4/26/2010 5/3/2010 5/10/2010 2020 2122 23 2322 2223 2423 2523 2426 26 2727 2625 2526 2830 29 3232 3436 3937 3737 3939 41 3737 3941 4039 4041 42 4242 4343 4347 4848 5051 51 4951 4847 www.mackieresearch.com
    • 9 Source: CapitalIQ Multiple (x) # companies 0.0x 5.0x 10.0x 15.0x 20.0x 25.0x 30.0x 3/23/2009 3/30/2009 4/6/2009 Median P/E 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 9/14/2009 9/21/2009 Median 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 11/30/2009 12/7/2009 Long-term average 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 2/15/2010 2/22/2010 below LT average 3/1/2010 P/E multiples also 3/8/2010 3/15/2010 3/22/2010 3/29/2010 4/5/2010 4/12/2010 4/19/2010 4/26/2010 5/3/2010 5/10/2010 1819 1918 18 1918 1919 2020 1818 1919 20 2124 2525 2425 2628 26 2929 3030 3231 3133 3537 36 3637 3738 3935 3737 38 3636 3331 3130 3333 3433 33 3232 3134 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 3 SMS/Voice 6 Marketing 4 Mobile 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 Gaming 14 EV/EBITDA 5 Social Networking 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 0.1 Ngi Group Inc. Asknet AG Cyberplex Inc. GigaMedia Ltd. Source: CapitalIQ Jumbuck Entertainment Limited RealNetworks Inc. Actoz Soft Co., Ltd. Tree.Com, Inc. Uniserve Communications Corp. Openwave Systems Inc. Glu Mobile, Inc. GameOn Co Ltd. DADA SpA Northgate Technologies Limited TheStreet.com, Inc. IAC/InterActiveCorp. Points International Ltd. AOL, Inc. Internet Group SA CDC Corp. United Online, Inc. 0.10.2 0.30.40.4 0.4 0.50.50.50.60.6 0.60.60.6 0.70.70.80.80.80.80.8 The New York Times Company AQ Interactive, Inc. CornerWorld Corporation OAO RBC Information Systems HanbitSoft, Inc. EV/Revenue Ranking infoGROUP, Inc. NetDragon WebSoft, Inc. Gamania Digital Entertainment Co., Ltd. Hutchison Telecommunications Hong SNAP Interactive, Inc. Spark Networks, Inc. YD Online Corp. ValueClick, Inc. Ynk Korea Inc. Oriented Media Group Berhad 0.9 1.0 1.0 1.2 1.3 1.3 1.3 1.4 1.4 1.5 1.5 1.5 1.6 1.7 1.7 Shutterfly, Inc. Score Media Inc. NeuLion Incorporated Modern Times Group Mtg AB XING AG Velti Plc PNI Digital Media Inc. Sohu.com Inc. Wizzard Software Corporation 1.9 2.0 2.12.22.22.2 2.3 2.4 2.5 GungHo Online Entertainment, Inc. Webzen Inc. Open Text Corp. 2.82.82.9 Myriad Group AG Frogster Interactive Pictures AG iseemedia Inc. UOMO Media, Inc NEOWIZ Games Corporation Taleo Corp. 3.0 3.1 3.13.3 3.53.6 SK Communications Co., Ltd. Changyou.com Limited revenue multiple at 46.4x SpectrumDNA has highest DigitalPost Interactive, Inc. HUGHES Telematics, Inc. Kingsoft Corporation Limited WebMediaBrands Inc 4.6 4.74.94.9 5.0 5.2 Lingo Media Corporation Mixi, Inc. Accelerize New Media, Inc. 5.4 5.6 5.6 Unilava Corporation Gree, Inc. 7.9 8.3 TransGaming, Inc. Fluid Music Canada, Inc. 11.1 Chinese Gamer International 11.811.8 GeoSentric Oyj Beyond Commerce, Inc. 13.8 MOKO.mobi Limited 15.5 Paid Inc. 19.2 Tencent Holdings Ltd. 21.8 Bright Things plc 27.8 SpectrumDNA, Inc. 46.4 www.mackieresearch.com
    • 12 0.0 5.0 10.0 15.0 20.0 25.0 30.0 35.0 40.0 45.0 Jumbuck Entertainment Limited Cyberplex Inc. 0.8 1.9 Source: CapitalIQ Actoz Soft Co., Ltd. AOL, Inc. GameOn Co Ltd. 2.3 2.4 2.5 United Online, Inc. 4.2 The New York Times Company ValueClick, Inc. Sohu.com Inc. Hutchison Telecommunications Hong Kong Holdings 5.3 5.4 5.5 5.6 Ltd. DADA SpA infoGROUP, Inc. NetDragon WebSoft, Inc. EV/EBITDA Ranking Spark Networks, Inc. YD Online Corp. 6.0 6.7 6.9 6.9 7.0 CDC Corp. Changyou.com Limited Gamania Digital Entertainment Co., Ltd. XING AG 7.1 7.4 7.9 8.0 IAC/InterActiveCorp. PNI Digital Media Inc. Uniserve Communications Corp. 8.5 9.0 9.1 GungHo Online Entertainment, Inc. Open Text Corp. Velti Plc 10.2 10.3 10.7 Kingsoft Corporation Limited at 42.6x NEOWIZ Games Corporation Score Media Inc. 11.7 12.312.4 Shutterfly, Inc. Tencent leads the group Gree, Inc. HanbitSoft, Inc. 12.9 13.8 13.8 Modern Times Group Mtg AB Ynk Korea Inc. 15.0 15.0 Mixi, Inc. Frogster Interactive Pictures AG 17.7 18.5 Openwave Systems Inc. 18.9 TheStreet.com, Inc. Chinese Gamer International 22.3 23.1 Taleo Corp. 26.3 Tencent Holdings Ltd. 42.6 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 Jumbuck Entertainment Limited 4.2 GigaMedia Ltd. 5.1 Cyberplex Inc. 5.7 DADA SpA 8.4 P/E Ranking YD Online Corp. 8.5 United Online, Inc. Changyou.com Limited AOL, Inc. GameOn Co Ltd. 10.4 10.6 12.0 12.4 ValueClick, Inc. Sohu.com Inc. 13.2 14.6 The New York Times Company Kingsoft Corporation Limited Hutchison Telecommunications Hong Kong Holdings 15.7 17.2 17.4 Ltd. CDC Corp. 18.5 Frogster Interactive Pictures AG Velti Plc 21.3 21.8 NetDragon WebSoft, Inc. 23.6 Gree, Inc. 27.3 Gamania Digital Entertainment Co., Ltd. Actoz Soft has the highest P/E at 93.4x Chinese Gamer International 29.9 30.4 NEOWIZ Games Corporation 36.1 Open Text Corp. 44.9 infoGROUP, Inc. Mixi, Inc. 47.0 48.4 Tencent Holdings Ltd. 55.3 HanbitSoft, Inc. 73.1 Shutterfly, Inc. 82.1 Actoz Soft Co., Ltd. 93.4 www.mackieresearch.com
    • 14 Source: CapitalIQ (US$m) # companies - 10,000 20,000 30,000 40,000 50,000 60,000 70,000 80,000 90,000 100,000 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 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 11/30/2009 12/7/2009 12/14/2009 12/21/2009 12/28/2009 Total Market Capitalization - $80 BN 1/4/2010 1/11/2010 1/18/2010 1/25/2010 2/1/2010 2/8/2010 2/15/2010 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 5/3/2010 5/10/2010 95 94 95 95 95 95 95 95 95 95 95 95 95 95 95 95 94 95 95 95 95 96 96 96 96 96 97 97 98 98 98 98 98 98 98 98 98 98 98 98 99 99 99 99 99 99 99 99 99 99 99 99 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 45,000.0 7 Diversified Gaming 27 Media 10 Social Networking 16 1 Collaboration 6 Marketing 3 Enterprise 1 Search 2 Internet Retail 5 Mobile Total Market Cap – by Sector 3 SMS/Voice 2 Music 1 Financial Services 2 Dating 1 Video 2 Virtual World 3 Advertising over $17 bn in market cap 1 Vertical Communities 27 Gaming companies totaling 1 Payment 3 Infrastructure 1 Podcasting 1 Learning www.mackieresearch.com
    • 16 0 1,000 2,000 3,000 4,000 5,000 6,000 Mobile Data Corp. BroadWebAsia Inc. CornerWorld Corporation UOMO Media, Inc Source: CapitalIQ Uniserve Communications Corp. Beyond Commerce, Inc. DigitalPost Interactive, Inc. En2Go International, Inc. Oriented Media Group Berhad Worlds.com Inc. Kiwibox.Com, Inc. Bright Things plc SNAP Interactive, Inc. Kent International Holdings Inc. Real Value Estates, Inc. Sahara Media Holdings, Inc. SpectrumDNA, Inc. Lingo Media Corporation iseemedia Inc. MOKO.mobi Limited VOIS, Inc. Jumbuck Entertainment Limited Internet Group SA Wizzard Software Corporation IAS Energy, Inc. Northgate Technologies Limited Accelerize New Media, Inc. Dolphin Digital Media, Inc. Ynk Korea Inc. Asknet AG LookSmart, Ltd. Socialwise, Inc. Market Cap Ranking NeXplore Corporation GeoSentric Oyj TransGaming, Inc. Glu Mobile, Inc. WebMediaBrands Inc Unilava Corporation Cyberplex Inc. Multiplied Media Corporation DigitalTown, Inc. Gravity Co., Ltd Frogster Interactive Pictures AG PNI Digital Media Inc. Ngi Group Inc. Quepasa Corp. Score Media Inc. NeuLion Incorporated Moggle, Inc Spark Networks, Inc. DADA SpA HanbitSoft, Inc. Points International Ltd. Tree.Com, Inc. AQ Interactive, Inc. YD Online Corp. HUGHES Telematics, Inc. Paid Inc. TheStreet.com, Inc. Actoz Soft Co., Ltd. GameOn Co Ltd. Fluid Music Canada, Inc. GigaMedia Ltd. Webzen Inc. The9 Limited OAO RBC Information Systems Myriad Group AG XING AG Velti Plc Openwave Systems Inc. Gamania Digital Entertainment Co., Ltd. dominates group NetDragon WebSoft, Inc. CDC Corp. GungHo Online Entertainment, Inc. infoGROUP, Inc. RealNetworks Inc. Tencent’s $36 bn market cap Shutterfly, Inc. United Online, Inc. NEOWIZ Games Corporation SK Communications Co., Ltd. ValueClick, Inc. Kingsoft Corporation Limited Mixi, Inc. Chinese Gamer International Taleo Corp. Hutchison Telecommunications Hong The New York Times Company Changyou.com Limited Perfect World Co., Ltd. Giant Interactive Group, Inc. Sohu.com Inc. IAC/InterActiveCorp. Open Text Corp. AOL, Inc. Gree, Inc. Shanda Interactive Entertainment Ltd. Modern Times Group Mtg AB Netease.com Inc. Tencent Holdings Ltd. www.mackieresearch.com
    • Price Performance – 1 Week • Negative momentum with 69% of stocks falling over the past week Price Momentum (following on last week’s 62% decliner figure). Rising 21% Falling 69% Flat 10% 17 www.mackieresearch.com
    • Average Price Performance – 1 Week, By Sector 70.0% 60.0% 56.3% Music-related securities get biggest boost 50.0% 40.0% 30.0% 20.0% 7.8% 10.0% 4.0% 3.0% 0.0% -10.0% -2.4% -2.9% -3.3% -3.6% -3.8% -3.9% -4.5% -4.8% -6.1% -7.8% -8.8% -9.5% -11.8%-12.7%-14.2% -20.0% -15.0% -18.1% -21.8% -30.0% Internet Retail Infrastructure Collaboration Networking Virtual World Financial Payment Communities Advertising Learning Music Search Mobile Marketing Diversified Enterprise Gaming Dating Podcasting Services Media SMS/Voice Video Social Vertical # companies 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% 100.0% MBYL BWBA OMEDIA STVI Source: CapitalIQ KIWB GIGM SHHD 2497 RBCI NCTY WDDD 3838 WZE TSCM 2121 GTSM:308 TREE GLUU HUTC TSX:NLN MKB CM:DA UNTD TSXV:TNG WEBM BYOC VOIS TLEO TSXV:LM NYT 3765 RNWK QPSA VCLK CYOU WSE:IGR MTG B 700 3888 777 SEHK:215 IACI 590057 SOHU GRVY A023770 DB:M0C Price Performance – 1 Week SFLY LOOK GA IEE A047080 VEL PWRD A052790 SCLW TSX:SCR TSX:PTS UNLA NTES A095660 ASX:JMB SNDA 6180 LOV IUSA CHIN.A O1BC DPDM DGLP ETGI TSXV:PN PAYD CWRL RVLU DGTW AIM:BGT GEO1V KNTH TSXV:MM OPWV KOSE:A06 ACLZ OTEX XTRA:A5A A052770 TSXV:USS SPXA TSE:3632 FRG 3812 A066270 AOL MYRN NXPC TSX:CX TSX:FMN IASC.A UOMO www.mackieresearch.com
    • 20 0% 20% 40% 60% 80% 100% 120% 140% 0% 500% 1000% 1500% 2000% 2500% OAO RBC Information DigitalTown, Inc. Systems Beyond Quepasa Corp. Source: CapitalIQ Commerce, Inc. AQ Interactive, IAS Energy, Inc. Inc. Uniserve SK Communications Communications Corp. Co., Ltd. SK Communications LookSmart, Ltd. Co., Ltd. 6 Month 1 Month Ngi Group Inc. Quepasa Corp. Velti Plc Glu Mobile, Inc. Points Score Media Inc. International Ltd. Points Fluid Music International Ltd. Canada, Inc. GungHo Online WebMediaBrands Entertainment, Inc Inc. Price Performance (Top 10) 0% 500% 1000% 1500% 2000% 2500% 3000% 3500% 0% 500% 1000% 1500% 2000% 2500% 3000% OAO RBC OAO RBC Information Information Systems Systems Quepasa Corp. IAS Energy, Inc. TransGaming, Inc. Beyond Commerce, Inc. DigitalPost Unilava Interactive, Inc. Corporation Fluid Music Canada, Inc. GameOn Co Ltd. 1 Year 3 Month Uniserve Communications Quepasa Corp. Corp. AQ Interactive, Inc. LookSmart, Ltd. SK Frogster Interactive Communications Pictures AG Co., Ltd. AQ Interactive, Velti Plc Inc. Hutchison Telecommunication Ngi Group Inc. s 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% The9 Limited GigaMedia Ltd. OAO RBC Source: CapitalIQ Information DADA SpA Systems GeoSentric Oyj Ngi Group Inc. Mobile Data Sahara Media Corp. Holdings, Inc. Cyberplex Inc. GigaMedia Ltd. 1 Week 6 Month Wizzard Kiwibox.Com, Software Inc. Corporation UOMO Media, SNAP Inc Interactive, Inc. CornerWorld Oriented Media Corporation Group Berhad En2Go BroadWebAsia International, Inc. Inc. BroadWebAsia Mobile Data Inc. Corp. -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% The9 Limited Cyberplex Inc. Northgate GeoSentric Oyj Technologies Limited Wizzard iseemedia Inc. Software Corporation Mobile Data GigaMedia Ltd. Corp. CornerWorld DADA SpA Corporation 1 Year 1 Month UOMO Media, SNAP Inc Interactive, Inc. En2Go BroadWebAsia International, Inc. Inc. Sahara Media CornerWorld Holdings, Inc. Corporation Beyond Oriented Media Commerce, Group Berhad Inc. BroadWebAsia Mobile Data Inc. Corp. www.mackieresearch.com
    • Capital Market Activity (Financing, M&A) 22 www.mackieresearch.com
    • Financing Activity – Current Month Com pany Nam e Country Sector Acquisition Angel/Seed Series A Series B Series C Grand Total CubeTree USA Collaboration 50.0 50.0 Scout Labs USA Analytics 20.0 20.0 Fatfoogoo Austria Virtual Goods 10.0 10.0 Worldw idew orker UAE Vertical Communities 9.0 9.0 Criteo USA Advertising 7.0 7.0 WordStream USA Search 6.0 6.0 Stack Overflow USA Vertical Communities 6.0 6.0 Enquisite USA Analytics 5.2 5.2 HelloWallet USA Financial Services 3.6 3.6 Woozw orld Canada Virtual World 3.0 3.0 Groupalia Spain Social Commerce 2.5 2.5 New sy USA Media 2.0 2.0 The Extraordinaries USA Mobile 1.1 1.1 Localytics USA Analytics 0.7 0.7 MightyMeeting USA Collaboration 0.3 0.3 apprupt Germany Mobile Ad 89.0 3.4 15.8 6.0 12.2 126.4 23 www.mackieresearch.com
    • Financing Activity – Current Month, by Sector $ Raised # Deals Social Mobile Enterprise Virtual World Commerce Media 1% 1% 3% Enterprise Financial 2% 2% Services 6% Search3% Mobile Collaboration 5% 6% 11% Media Collaboration 6% Advertising 5% 38% Social Analytics Commerce 17% Virtual Goods 6% 8% Virtual World 12% Vertical Financial Communities Vertical Services 12% Communities 6% Virtual Goods Advertising 12% Search 6% 6% 6% Analytics 20% 24 www.mackieresearch.com
    • Financing Activity 900.0 18.0 $513M (ex-DST) with 16.6 800.0 $10.7M average deal size 16.0 700.0 14.0 12.5 12.5 600.0 12.0 10.5 500.0 9.1 10.0 (US$m) (US$m) 8.9 8.2 400.0 8.0 6.4 300.0 5.5 5.5 5.3 6.0 4.6 200.0 3.4 4.0 100.0 2.0 0.0 0.0 May-09 Jun-09 Jul-09 Aug-09 Sep-09 Oct-09 Nov-09 Dec-09 Jan-10 Feb-10 Mar-10 Apr-10 May-10 *May-09 includes $200m FB investment Dec-09 includes $180m Zynga investment Total Average Apr-10 includes $300m DST investment 25 www.mackieresearch.com
    • 26 (US$m) 0.0 50.0 100.0 150.0 200.0 250.0 300.0 350.0 # companies Diversified Mobile Collaboration Gaming Crowdsourced Social Media Video Advertising Social Analytics Financial Mobile Ad Widget Search Vertical Mobile Enterprise Internet Retail Location- Online Virtual World Advertising has most deals in last 3 months Virtual Goods Travel Infrastructure Blog Classified Music Capital Market Activity Ranking – by Sector, last three months Micromedia Online Dating Microblog www.mackieresearch.com
    • Top 10 Deals (2010 YTD) Financings Acquisitions 350.0 250 225.0 300.0 300.0 200 187.5 250.0 160.0 200.0 150 142.0 150.0 135.0 100.0 100 100.0 80.0 50.0 44.0 40.0 50.0 50.0 27.5 25.0 25.0 25.0 24.5 50 36.5 33.0 0.0 0.0 Technologies LendingClub Yelp Quantcast LivingSocial Groupon Tremor Media Vidyo Ngmoco Paymo Digital Sky 0 Siri ICQ Turbine Jigsaw Ankeena Mochi CubeTree Aardvark StudioNow Saf-T-Net Networks Media DST involved in 2 largest financing deals YTD and 2nd largest acquisition 27 www.mackieresearch.com
    • Upcoming Events/Earnings Company Date Time Quarter Conf Call Details CDC Corp. (NasdaqGS:CHIN.A) 11-May-10 9:00 AM (EST) Q1/10 888-603-6873, #68538655 Tencent Holdings Ltd. (SEHK:700) 12-May-10 8:00 AM (EST) Q1/10 1-212-444-0118, #613567 PNI Digital Media Inc. (TSXV:PN) 12-May-10 4:30 PM (EST) Q2/10 888-300-8196 Points International Ltd. (TSX:PTS) 13-May-10 8:00 AM (EST) Q1/10 877-941-2069 WebMediaBrands Inc (NasdaqGS:WEBM) 13-May-10 11:00 AM (EST) Q1/10 877-675-4749, #5683457 Spark Netw orks, Inc. (AMEX:LOV) 13-May-10 1:30 PM (PST) Q1/10 1-888-233-7978, #9854349 Perfect World Co., Ltd. (NasdaqGS:PWRD) 17-May-10 8:00 AM (EDT) Q1/10 1-866-519-4004 Giant Interactive Group, Inc. (NYSE:GA) 17-May-10 9:00 PM (EST) Q1/10 1-866-804-6921 Netease.com Inc. (NasdaqGS:NTES) 19-May-10 9:00 PM (EST) Q1/10 877-941-2069 Source: CapitalIQ 28 www.mackieresearch.com
    • Public Company Listing Trading Current US$ Market Com pany Nam e Ticker Exchange Currency HQ Price Cap (m m ) Em ployees A ccelerize New M edia, Inc. A CLZ OTCB B USD United States 1 16.4 10 A cto z So ft Co ., Ltd. A 052790 KOSE KRW So uth Ko rea 13,300 103.6 NA A OL, Inc. A OL NYSE USD United States 24 2,51 2.2 6,700 A Q Interactive, Inc. 3838 TSE JP Y Japan 1 00 45,1 84.4 NA A sknet A G XTRA :A 5A XTRA EUR Germany 3 21 .9 NA B eyo nd Co mmerce, Inc. B YOC OTCB B USD United States 0 4.3 NA B right Things plc A IM :B GT A IM GB P United Kingdo m 0 6.0 9 B ro adWebA sia Inc. B WB A OTCP K USD United States 0 1.7 46 CDC Co rp. CHIN.A NasdaqGS USD Ho ng Ko ng 3 275.0 NA Changyo u.co m Limited CYOU NasdaqGS USD China 30 1,557.9 1,308 Chinese Gamer Internatio nal GTSM :3083 GTSM TWD Taiwan 334 907.7 NA Co rnerWo rld Co rpo ratio n CWRL OTCB B USD United States 0 1.9 16 Cyberplex Inc. TSX:CX TSX CA D Canada 1 41 .4 NA DA DA SpA CM :DA CM EUR Italy 4 74.1 NA DigitalP o st Interactive, Inc. DGLP OTCB B USD United States 0 4.8 6 DigitalTo wn, Inc. DGTW OTCB B USD United States 2 48.0 3 Do lphin Digital M edia, Inc. DP DM OTCB B USD United States 0 17.6 NA En2Go Internatio nal, Inc. ETGI OTCB B USD United States 0 4.8 NA Fluid M usic Canada, Inc. TSX:FM N TSX CA D United States 2 122.4 NA Fro gster Interactive P ictures A G FRG XTRA EUR Germany 18 59.2 NA Gamania Digital Entertainment Co ., Ltd. 61 80 GTSM TWD Taiwan 51 248.6 NA GameOn Co Ltd. 381 2 TSE JP Y Japan 105,700 1 2.7 1 NA Geo Sentric Oyj GEO1 V HLSE EUR Finland 0 34.6 120 Giant Interactive Gro up, Inc. GA NYSE USD China 7 1,662.6 NA GigaM edia Ltd. GIGM NasdaqGS USD Taiwan 2 128.1 751 Glu M o bile, Inc. GLUU NasdaqGM USD United States 1 38.8 479 Gravity Co ., Ltd GRVY NasdaqGM USD So uth Ko rea 2 52.5 469 Gree, Inc. TSE:3632 TSE JP Y Japan 5,51 0 2,667.2 NA GungHo Online Entertainment, Inc. 3765 OSE JP Y Japan 260,600 320.0 NA HanbitSo ft, Inc. A 047080 KOSE KRW So uth Ko rea 4,060 78.6 NA HUGHES Telematics, Inc. HUTC OTCB B USD United States 3 85.5 276 Hutchiso n Teleco mmunicatio ns Ho ng Ko ng Ho ldings Ltd. SEHK:21 5 SEHK HKD Ho ng Ko ng 2 1,045.9 1,732 IA C/InterA ctiveCo rp. IA CI NasdaqGS USD United States 21 2,380.7 3,200 IA S Energy, Inc. IA SC.A OTCP K USD Canada 0 12.0 NA info GROUP , Inc. IUSA NasdaqGS USD United States 8 459.2 3,1 46 Internet Gro up SA WSE:IGR WSE P LN P o land 1 10.9 NA 29 www.mackieresearch.com
    • Public Company Listing cont. Trading Current US$ Market Com pany Nam e Ticker Exchange Currency HQ Price Cap (m m ) Em ployees iseemedia Inc. IEE TSXV CA D Canada 0.1 2 7.8 79 Jumbuck Entertainment Limited A SX:JM B A SX A UD A ustralia 0.24 10.5 NA Kent Internatio nal Ho ldings Inc. KNTH OTCP K USD United States 1.81 6.4 NA Kingso ft Co rpo ratio n Limited 3888 SEHK HKD China 5.78 809.3 6 Kiwibo x.Co m, Inc. KIWB OTCB B USD United States 0.01 5.4 NA Lingo M edia Co rpo ratio n TSXV:LM TSXV CA D Canada 0.62 7.5 65 Lo o kSmart, Ltd. LOOK NasdaqGM USD United States 1.52 26.1 NA M ixi, Inc. 2121 TSE JP Y Japan 520,000.00 860.3 NA M o bile Data Co rp. M B YL OTCB B USD United States 0.04 1.0 2,936 M o dern Times Gro up M tg A B M TG B OM SEK Sweden 402.70 3,525.4 2 M o ggle, Inc DB :M 0C DB EUR United States 14 .1 68.4 NA M OKO.mo bi Limited M KB A SX A UD A ustralia 0.08 8.5 NA M ultiplied M edia Co rpo ratio n TSXV:M M C TSXV CA D Canada 0.1 8 42.6 405 M yriad Gro up A G M YRN SWX CHF Switzerland 4.01 175.8 NA NEOWIZ Games Co rpo ratio n A 095660 KOSE KRW So uth Ko rea 39,300.00 732.4 NA NetDrago n WebSo ft, Inc. 777 SEHK HKD China 3.91 265.7 NA Netease.co m Inc. NTES NasdaqGS USD China 33.64 4,357.1 224 NeuLio n Inco rpo rated TSX:NLN TSX CA D Canada 0.60 68.2 NA NeXplo re Co rpo ratio n NXP C OTCP K USD United States 0.50 27.9 NA Ngi Gro up Inc. 2497 TSE JP Y Japan 46,500.00 61 .7 160 No rthgate Techno lo gies Limited 590057 B SE INR India 16.90 13.1 2,523 OA O RB C Info rmatio n Systems RB CI M ICEX RUB Russia 38.32 170.4 3,41 1 Open Text Co rp. OTEX NasdaqGS USD Canada 44.22 2,51 0.8 590 Openwave Systems Inc. OP WV NasdaqGS USD United States 2.39 200.4 NA Oriented M edia Gro up B erhad OM EDIA KLSE M YR M alaysia 0.1 2 5.0 20 P aid Inc. P A YD OTCB B USD United States 0.34 91 .4 NA P erfect Wo rld Co ., Ltd. P WRD NasdaqGS USD China 32.80 1,634.3 NA P NI Digital M edia Inc. TSXV:P N TSXV CA D Canada 1.80 60.1 91 P o ints Internatio nal Ltd. TSX:P TS TSX CA D Canada 0.56 81 .7 71 Quepasa Co rp. QP SA OTCB B USD United States 5.00 64.8 NA Real Value Estates, Inc. RVLU OTCB B USD Israel 1.03 6.6 1,754 RealNetwo rks Inc. RNWK NasdaqGS USD United States 4.09 552.7 NA Sahara M edia Ho ldings, Inc. SHHD OTCB B USD United States 0.20 6.7 220 Sco re M edia Inc. TSX:SCR TSX CA D Canada 0.84 66.5 NA Shanda Interactive Entertainment Ltd. SNDA NasdaqGS USD China 44.44 2,988.8 51 9 Shutterfly, Inc. SFLY NasdaqGS USD United States 22.28 598.3 NA 30 www.mackieresearch.com
    • Public Company Listing cont. Trading Current US$ Market Com pany Nam e Ticker Exchange Currency HQ Price Cap (m m ) Em ployees SK Co mmunicatio ns Co ., Ltd. A 066270 KOSE KRW So uth Ko rea 20,000.00 740.4 15 SNA P Interactive, Inc. STVI OTCB B USD United States 0.19 6.3 NA So cialwise, Inc. SCLW OTCB B USD United States 0.54 26.2 3,997 So hu.co m Inc. SOHU NasdaqGS USD China 45.77 1,730.9 1 55 Spark Netwo rks, Inc. LOV A M EX USD United States 3.50 72.1 NA SpectrumDNA , Inc. SP XA OTCB B USD United States 0.10 6.9 91 6 Taleo Co rp. TLEO NasdaqGM USD United States 24.12 959.0 7,51 5 Tencent Ho ldings Ltd. 700 SEHK HKD China 154.20 36,243.7 7,665 The New Yo rk Times Co mpany NYT NYSE USD United States 9.36 1,362.8 1 0 ,01 The9 Limited NCTY NasdaqGS USD China 5.35 136.5 274 TheStreet.co m, Inc. TSCM NasdaqGM USD United States 3.24 102.2 28 TransGaming, Inc. TSXV:TNG TSXV CA D Canada 0.64 37.1 700 Tree.Co m, Inc. TREE NasdaqGM USD United States 7.53 83.9 39 Unilava Co rpo ratio n UNLA OTCB B USD United States 0.41 41.0 NA Uniserve Co mmunicatio ns Co rp. TSXV:USS TSXV CA D Canada 0.11 2.6 1,699 United Online, Inc. UNTD NasdaqGS USD United States 7.24 630.9 NA UOM O M edia, Inc UOM O OTCB B USD Canada 0.03 2.6 1,086 ValueClick, Inc. VCLK NasdaqGS USD United States 9.75 792.9 450 Velti P lc VEL A IM GB P United Kingdo m 3.25 183.0 2 VOIS, Inc. VOIS OTCB B USD United States 0.01 9.1 83 WebM ediaB rands Inc WEB M NasdaqGS USD United States 1.05 39.3 NA Webzen Inc. KOSE:A 069080 KOSE KRW So uth Ko rea 12,600.00 132.0 80 Wizzard So ftware Co rpo ratio n WZE A M EX USD United States 0.20 1 .6 1 NA Wo rlds.co m Inc. WDDD OTCB B USD United States 0.10 5.4 NA XING A G O1 C B XTRA EUR Germany 26.70 176.9 NA YD Online Co rp. A 052770 KOSE KRW So uth Ko rea 6,400.00 84.9 NA Ynk Ko rea Inc. A 023770 KOSE KRW So uth Ko rea 2,950.00 20.8 - 31 www.mackieresearch.com
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