Next Internet 2008

Slide 1: NextInternet Next Internet Kenneth Chan March 2008 1

Slide 2: My Name is Ken I’m the founder and CEO of Next Internet + Over the last ten years, I’ve started numerous Internet companies. I founded Next Internet because I believe that there is a better way to build Internet companies than what currently exists today… + We started Next Internet in Nov 2005 and currently have 250 employees, 7 operating companies, and are profitable. + We are currently focused on building Next Internet and our portfolio companies. Please use this site to learn more about us. 2

Slide 3: Next Internet: Mission The Best Place to Create and Build Internet Companies. - People – Best Long Term Career Platform - Employees – Best Place to Work - Investors – Favorite Investment - Partners – Best Company to do Business With

Slide 4: The Problem: I didn’t want to start another startup Startup Model Corporate Model Next Internet Summary “Small, Fast, Upside” “Big, Powerful, Steady” “Small but Big, Fast but Powerful, Steady with Upside” Strengths - Upside - Stability - Upside - Flexibility - Unfair Advantages - Stability - Speed - Resources - Speed - Infrastructure - Unfair Advantages - Resources - Infrastructure Weakness - Lack of Stability - Lack of Upside - Lack of Infrastructure - Lack of Speed - Lack of Unfair Advantages - Lack of Flexibility After leaving my last company, I didn’t want to start another internet company or join a startup. I didn’t feel it wouldn’t provide the stability to allow me to “grow up” (to get married, have kids, grow old, etc…). However, I wanted to continue starting Internet companies but still have stability, something I can work on for 20 years, with a great upside, increasing leverage, and be able to take 3 months of vacation if I wanted to. Since this career platform didn’t exist in the marketplace, I had to create it. That’s why I founded Next Internet. Soon after founding Next Internet, I noticed that I wasn’t the only entrepreneur that had these type of issues with their career and life. I discovered that I could provide this unique platform to these entrepreneurs as well. 4

Slide 5: What does Next Internet do? Next Internet Creates and Builds Internet Companies To create an Internet company, you need 3 things: An idea, a team of People $$$ Ideas people, and funding to support operations. Ideas are usually pretty easy. We generate the ideas internally. Characteristics of ideas that we love new are: simplicity, sustainability, scalability, passionablity. company company Next People are the greatest factor in the Internet success or failure of a company. Attracting and managing people are the new toughest – and most important – company challenges in our business today. It ALWAYS takes a significant amount of capital to take something from an company idea to a sustainable business. Up to this point, we have been funding our companies internally. company 5

Slide 6: What does Next Internet actually do? Next Internet Creates and Builds Internet Companies Conceive Vision. Provide Funding. Run Profitably. Hiring Founding Team. Hire Management Recapitalization. Provide Funding. team. Develop Strategic Sales. Take Majority Position. operations. Scale Merger. Initial Operations. Revenue/Earnings. Consolidate within Next. Gain Traction. Build Market position. IPO. Each company in Next Internet is established as a separate company rather than as a division. We believe that this structure allows each business to retain the entrepreneurial drive, spirit and accountability of a startup while benefiting from the economies of scale and network effect associated with the larger whole of Next Internet. We generally take majority position in our operating companies and normally provide continuing funding until the business is profitable. To create a business, we usually start with a person or team that we really believe in and/or an idea that we are passionate about. We develop a business and operating plan and hire the best founding team. We usually build a prototype and validate our assumptions regarding the business and the team. If there is significant traction, we work hard to scale the operations. We provide a full set of start-up services (shared offices, recruiting, corporate function) and business expertise (planning, strategy, marketing, business development) and we work hard to develop the company culture, hire the right management team, and scale the operating processes to turn a startup into a business.

Slide 7: Where does Next Internet’s income come from? From Profitable Companies and Selling Companies People $$$ Ideas We capture value from our operating businesses either by running it profitability and sharing new the profit with employees company Profitable Next and management or company selling all or a piece of the Internet new business off to strategic company investors. Profitable company company 7

Slide 8: What type of Internet companies? We create and build Internet companies that are significant and sustainable. Audience Monetization Service Infrastructure Next Internet creates and builds 4 type of Internet companies. The Audience company, where we are using the internet to build a profitable audience. The Monetization company, where we are helping the audience company generate revenue. The Service company, where we are providing a valuable service to consumers. The Infrastructure company, where we are providing an underlying technology or offering to consumers and/or businesses.

Slide 9: What are the keys to building an audience company? We create and build Internet companies that are significant and sustainable. Audience Monetization Service Infrastructure Audience businesses are usually product-driven companies offering a “free” Internet service to build a profitable audience. Example of Audience businesses are: Yahoo Mail, Myspace, Yelp, Firefox, Craigslist, WebMD. Passion: Your core team should be to be product-driven and passionate about building the best “free” service for the audience. Patience: Its takes a long time and a lot of focus to build a world-class service and a significant audience . Basic Need: The service should fill a basic need for a very large audience . Valuable Audience: Since the business generates revenue from the audience, the audience should be valuable.

Slide 10: What are the keys to building a monetization company? We create and build Internet companies that are significant and sustainable. Audience Monetization Service Infrastructure Monetization businesses utilize the Internet to connect the marketer with their audience and deliver them new customers cost effectively and efficiently. Examples of Monetization businesses are: Google Adwords, Google Adsense, Advertising.com, Commission Junction, Lowermybills, Federated Media. Domain Expertise: Your core team should be experts in their Monetization area. Sustainability: Proprietary traffic, Proprietary technology and/or process, strong balance sheet Flexibility: Adapt to sudden changes in technology, audience, and clients. Long-Term View: Take a long term view regarding investments and ethics.

Slide 11: What are the keys to building an audience company? We create and build Internet companies that are significant and sustainable. Audience Monetization Service Infrastructure Service companies utilize the Internet to deliver a next generation service to their customers. They usually require significant resources and expertise in multiple functions to succeed. Example of Service businesses are: Amazon, Netflix, Zappos, Expedia, Ebay. Resources: It takes significant resources, both in terms of capital and people, to build a service business. It is generally accepted that it takes five times more resources are required to build a service vs. audience business. Simplicity: The value proposition and differentiation should be simple and clear to the customers. If its not, then it’ll be extremely hard to build, market and engage the organization. Patience: Its takes a long time and a lot of focus to build a world-class service. Leadership: This type of business is usually complex to build and manage. Its requires significant leadership skills to align and acquire the resources necessary for the business.

Slide 12: What is Next Internet’s Strategy? Focus on Monetization. Seed Audience and Service. SEED FOCUS SEED Audience Monetization Service Next Internet is currently focused on creating and building Internet Monetization businesses. We have deep domain knowledge and experience, market presence and significant unfair advantages in Monetization. These businesses can be profitable within a reasonable period, usually within 24 months, and are an efficient use of capital. We believe that there are significant opportunities within the Monetization space. We are currently seeding our Audience DNA. We developed one successful audience business – Justsayhi.com (Free Dating, grew from 0 to 40M page views in 12 months) – and will incubate two more audience businesses in the next 12 months. We are currently seeding our Service DNA with tobi.com – 1to1 Shopping Experience. 12

Slide 13: What are Next Internet’s Monetization companies? Idea Update “We Deliver Clicks - Founded Nov 05 Beyond Google” - 80 Employees - Build the #1 integrated click marketplace - Investment Dec 08 Adteractive “We Deliver Leads” - 40 Employees - Build the #1 Internet Lead Gen company - Founded Apr 06 Nextclick “We Deliver Customers” - 50 Employees - Build the #1 Internet Customer Acquisition company “1-800 # Provider to - Founded in Feb 08 N e x t C a ll Creatives.LandingPages - Multiple channel marketing .Sites” “We Sell Finance - Founded Apr 06 Leads” - Minority Investment - Based in LA (Profitable) (investment)

Slide 14: What are Next Internet’s Audience companies? Idea Update “Free Dating” - Launched Sept 06 - 4 Employees - 50M Monthly PVs “Site 2” “Stealth” - Launching in Q3 “Site 3” “Stealth” - Launching in Q3 14

Slide 15: What are Next Internet’s Service companies Idea Update “1-1 Shopping” - Founded June 06 - 50 Employees Tobi is creating the next generation Internet shopping experience that will be more personal, more convenient, and more fun. 15

Slide 16: Next Internet: Mission The Best Place to Create and Build Internet Companies. - People – Best Long Term Career Platform - Employees – Best Place to Work - Investors – Favorite Investment - Partners – Best Company to do Business With

Slide 17: The scarcest commodity in business is not customers, capital, or ideas. It's people! Next Internet believes that people are the greatest factor in the success or failure of a business. Attracting and managing people are the toughest – and most important – challenges in any business today. Our Mission: Best Long Term Career Platform. Best Place To Work. By doing this, we build a culture of dedicated and loyal employees, who really create the secret ingredient of a sustainable competitive advantage

Slide 18: The Internet Career Path New Director College Professional CEO VP Grad Founder Done The Internet Career Path consist of Six states The New College Grad: Great core characteristics: smart, hard working, great attitude. Need to develop stability, patience, and domain knowledge The Professional: Great at their job. Need to develop management and leadership skills The Director VP: Can manage a function or a set of functions. Need to learn how to lead and own a business unit. The CEO: Strong leadership and communication skills with the ability to rally both internal and external people around a vision and a plan, and lead them to success The Founder: Willing to be employee 1-5 of a new startup. Willing to take a big pay cut and make big sacrifices for equity upside and founder experience The Done: Financially done, Too young to do nothing. What do I do?

Slide 19: Next Internet: The Best Long Term Career Platform New Director College Professional CEO VP Grad Founder Done We want Next Internet to be your last job. Next Internet will work with our people, side by side, to locally optimize the current opportunity Next Internet will stand behind you, with full support, to help you globally optimize your career, your happiness and your success. We embrace change and help our people move to their desired career state. We believe each career state is about 3 years. We offer a fully paid 2 month sabbatical after 3 years. People can switch jobs and/or companies, without their managers consent, after 3 years. Becoming a founder is easy. Just wait for the right time and be willing to take a big pay cut for 3 years. The Done can help us by serving on our boards and mentoring our people

Slide 20: Next Internet: The Best Place To Work

Slide 21: Thank You

Slide 22: Contact information Kenneth Chan ken@nextinternet.com http://www.nextinternet.com 22