Dmreport100812

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Dmreport100812

  1. 1. Weekly Internet / Digital Media Sector Summary Week of October 8th, 2012
  2. 2. Industry Stock Market Valuation Internet / Digital Media Last 12 Months Last 3 Months160 115 13% 53% 10%150 110 10% 9%140 38% 8% 30% 5% 105 28% 4%130 27% 22%120 20% 100110 95100 0% (8%) 90 9080 8510/05/11 01/04/12 04/05/12 07/05/12 10/05/12 07/05/12 07/27/12 08/20/12 09/12/12 10/05/12 (1) (2) (3) NASDAQ Search / Online Advertising eCommerce Internet Content (4) (5) (6) (7) Publishers Diversified Marketing Media Conglomerates Gaming Notes: 1) Search/Online Advertising Composite includes: AOL, BCOR, BLNX-GB, GOOG, IACI, MCHX, MM, MSFT, QNST, RLOC, VCLK, YHOO, YNDX. 2) eCommerce Composite includes: AMZN, AWAY, CPRT, DRIV, DWRE, EBAY, EXPE, FLWS, KYAK, LINTA, NFLX, NILE, OPEN, OSTK, PCLN, PRSS, STMP, TZOO, VPRT. 3) Internet Content Composite includes: DHX, DMD, EHTH, MOVE, MWW, RATE, RENN, RNWK, SCOR, SFLY, TRLA, TST, TTGT, UNTD, WBMD, WWWW, XOXO, Z. 4) Publishers Composite includes: MMB-FR, NWSA, NYT, PSO, SSP, TRI, UBM-GB, WPO. 5) Diversified Marketing Composite includes: ACXM, AGS-GB, EFX, EXPN-GB, HAV-FR, HHS, IPG, MDCA, NLSN, OMC, PUB-FR, VCI, WPP-GB. 1 6) Media Conglomerates Composite includes: CBS, CMCSA, DGIT, DIS, DISCA, LGF, SNE, TWX, VIA.B. 7) Gaming Composite includes: 035420-KR, 036570-KR, 2432-JP, 3632-JP, 700-HK, ATVI, CYOU, EA, GA, GAME, GLUU, NTES, PWRD, UBI, FR, ZNGA.
  3. 3. Public Company Valuations Internet / Digital Media: Financial Metrics($MM, Except Per Share Data) Stock LTM EPS Price Price Range Equity Net Aggregate AV / Revenue AV / EBITDA Price / EPS Long Term Revenue Growth 10/5/12 Low High Value Debt Value CY 11A CY 12E CY 13E CY 11A CY 12E CY 13E CY 11A CY 12E CY 13E Growth PEG 12E/11A Y/Y MRQSearch / Online AdvertisingGoogle Inc. $767.65 $510.30 $774.38 $251,047 ($33,601) $217,446 7.5 5.1 4.1 13.7 11.2 9.6 21.3 18.0 15.4 15.9% 1.1 46.6% 35.3%Microsoft Corporation 29.85 24.30 32.95 250,244 (49,269) 200,975 2.8 x 2.6 x 2.4 x 6.6 x 6.1 x 5.6 x 10.9 x 10.3 x 9.4 x 9.1% 1.1 7.5% 4.0%Yahoo! Inc. 16.09 14.35 16.79 19,061 (1,871) 17,189 3.9 3.9 3.8 10.8 11.2 10.2 19.6 15.7 14.7 13.0% 1.2 1.1% (0.9%)Yandex N.V. 24.20 16.60 42.01 7,900 (368) 7,532 12.1 8.1 6.0 25.5 17.9 13.4 41.5 29.8 22.3 35.3% 0.8 50.1% 28.7%ValueClick, Inc. 17.65 13.80 21.86 1,325 84 1,410 2.5 2.1 1.9 8.3 6.5 5.9 14.2 15.0 13.0 14.8% 1.0 22.0% 0.4%Millennial Media Inc. 15.06 9.00 27.90 1,146 (123) 1,023 9.9 5.7 3.7 NM NM 68.6 NM NM NM 84.0% NM 71.7% 75.6%Blucora, Inc. 17.70 8.23 18.63 715 (67) 648 2.8 1.6 1.4 18.4 7.6 6.4 26.2 15.5 12.8 20.0% 0.8 76.0% 85.8%ReachLocal, Inc. 12.85 6.05 13.98 365 (95) 271 0.7 0.6 0.5 11.1 13.2 9.9 NM NM NM 36.2% NM 19.8% 21.0%QuinStreet, Inc. 8.38 7.80 12.64 358 2 361 0.9 1.0 1.0 4.4 5.1 5.0 9.0 10.0 9.8 13.3% 0.7 (6.5%) (8.9%)Blinkx plc 0.96 0.54 2.61 349 (38) 310 3.0 2.1 1.7 26.1 24.7 12.6 68.8 80.2 28.3 NA NA 41.5% 80.3%Marchex, Inc. 3.76 2.99 9.35 140 (34) 106 0.7 0.8 0.7 4.6 5.7 4.9 12.5 17.2 14.1 15.0% 1.1 (6.5%) (12.2%) Mean 4.3 x 3.1 x 2.5 x 12.9 x 10.9 x 13.8 x 24.9 x 23.5 x 15.5 x 25.7% 1.0 29.4% 28.1% Median 2.8 2.1 1.9 10.9 9.4 9.6 19.6 15.7 14.1 15.5% 1.1 22.0% 21.0%Internet ContentIAC/InterActiveCorp $53.92 $38.13 $55.00 $4,721 ($850) $3,871 1.9 x 1.4 x 1.2 x 10.9 x 7.9 x 6.6 x 23.9 x 19.1 x 15.3 x 16.4% 1.2 32.9% 40.2%AOL Inc. 36.75 12.54 37.22 3,454 (1,360) 2,093 1.0 1.0 1.0 5.4 5.5 5.4 40.2 29.1 22.2 NM NM (2.5%) (2.0%)Bankrate, Inc. 15.93 15.12 25.95 1,593 116 1,708 4.0 3.3 2.8 12.7 10.7 8.7 26.1 20.2 15.6 23.3% 0.9 21.6% 24.0%Renren Inc. 3.96 3.21 7.87 1,536 (922) 614 5.2 3.4 2.4 NM NM NM 27.3 NM NM NM NM 51.0% 47.5%Zillow, Inc. 37.97 21.22 46.86 1,239 (70) 1,169 17.7 10.2 7.0 NM 52.9 29.7 NM NM 54.8 69.7% NM 73.0% 75.2%Shutterfly, Inc. 29.55 21.34 49.53 1,064 (118) 945 2.0 1.6 1.4 11.5 9.2 7.1 73.9 NM 61.6 16.8% NM 24.8% 30.7%Monster Worldwide, Inc. 7.30 5.72 10.40 863 12 875 0.8 0.9 0.9 4.8 6.3 5.7 19.7 37.3 24.8 20.3% 1.8 (8.5%) (12.1%)Demand Media, Inc. 10.67 5.24 12.50 855 (94) 761 2.4 2.1 1.8 8.9 7.6 6.5 42.7 29.4 23.4 21.5% 1.4 15.6% 17.1%WebMD Health Corp. 14.18 13.52 40.24 696 (164) 532 1.0 1.1 1.1 3.1 7.7 8.8 10.9 70.6 56.0 2.9% 24.0 (16.7%) (20.3%)comScore, Inc. 15.85 11.30 23.93 558 (38) 520 2.2 2.1 1.9 11.3 12.4 10.4 16.3 16.7 16.8 18.3% 0.9 7.8% 3.8%Dice Holdings, Inc. 8.88 6.95 11.01 552 (42) 510 2.8 2.7 2.5 6.6 6.8 6.2 18.1 16.6 14.7 16.7% 1.0 6.5% 8.0%United Online, Inc. 5.59 3.63 6.19 507 132 639 0.7 0.7 0.8 3.6 4.8 5.1 5.4 8.7 9.2 NA NA (4.2%) (9.3%)eHealth, Inc. 20.12 13.36 20.29 397 (122) 275 1.8 1.8 1.6 11.7 12.3 10.1 64.9 56.8 43.0 16.5% 3.4 2.9% (1.9%)Move, Inc. 8.52 4.05 10.06 335 (45) 290 1.5 1.5 1.3 11.3 10.6 8.4 39.1 21.5 15.6 28.5% 0.8 3.2% 0.8%RealNetworks Inc. 8.45 6.81 11.34 297 (283) 14 0.0 0.1 0.1 0.8 NA NA NM NM NM 7.0% NM (24.2%) (21.8%)TechTarget, Inc. 5.95 3.99 7.88 235 (55) 180 1.7 1.8 1.7 7.1 8.0 7.3 18.6 21.3 19.3 NA NA (2.9%) (6.2%)XO Group Inc. 8.76 6.67 10.04 212 (70) 143 1.1 1.1 1.0 7.5 6.4 5.5 43.8 30.2 26.3 15.0% 2.0 4.7% 2.1%TheStreet, Inc. 1.58 1.20 2.30 52 14 66 1.1 NA NA NM NA NA NM NM NM NA NA NA (17.0%) (1) Mean (2) 1.9 x 1.7 x 1.5 x 7.8 x 8.3 x 7.3 x 31.4 x 29.0 x 26.0 x 16.9% 3.7 7.0% 9.0% Median 1.8 1.6 1.4 7.5 7.9 7.1 26.1 21.5 22.2 16.8% 1.3 4.7% 2.1%Internet CommerceAmazon.com Inc. $258.51 $166.97 $264.11 $116,863 ($4,970) $111,893 2.3 x 1.8 x 1.4 x 47.1 x 35.3 x 25.1 x NM NM NM 43.7% NM 30.7% 29.5%eBay Inc. 48.73 28.15 50.65 62,797 (3,672) 59,125 5.1 4.2 3.7 15.4 12.8 11.1 24.0 20.9 18.0 14.3% 1.5 20.4% 23.1%priceline.com Incorporated 631.89 438.76 774.96 31,484 (2,496) 28,988 6.7 5.6 4.8 19.3 15.1 12.4 26.9 20.9 17.4 20.9% 1.0 18.5% 20.3%Liberty Interactive Corporation 18.86 14.54 19.80 10,263 5,259 15,522 1.6 1.5 1.5 8.6 8.1 7.7 16.9 17.2 14.1 18.2% 0.9 4.7% 5.3%Expedia Inc. 57.60 27.28 60.29 7,819 (1,144) 6,675 1.9 1.7 1.5 9.5 8.6 7.5 20.9 19.2 16.2 12.2% 1.6 13.9% 13.8%Netflix, Inc. 66.56 52.81 133.43 3,696 (413) 3,283 1.0 0.9 0.8 7.1 28.9 13.9 15.6 NM 76.5 5.6% NM 12.7% 12.8%Copart, Inc. 27.46 20.21 28.98 3,408 309 3,717 4.2 3.9 3.7 11.0 10.0 9.6 22.7 18.6 16.3 13.4% 1.4 6.2% 5.2%HomeAway, Inc. 26.14 19.19 38.11 2,157 (221) 1,936 8.4 6.9 5.7 29.1 24.1 18.9 NM 55.9 39.3 29.8% 1.9 21.7% 22.0%Kayak Software Corporation 33.93 26.02 37.00 1,307 (65) 1,241 5.5 4.2 3.4 24.7 18.4 13.7 46.1 43.9 32.7 29.0% 1.5 30.8% 35.6%Vistaprint N.V. 35.23 27.30 43.42 1,205 167 1,372 1.5 1.2 1.1 9.1 9.7 8.7 16.6 18.8 16.5 20.6% 0.9 21.1% 19.9%OpenTable, Inc. 44.79 31.54 52.95 1,012 (72) 941 6.7 5.8 4.9 16.9 13.8 11.3 35.0 28.0 23.5 22.0% 1.3 16.0% 15.4%Demandware, Inc. 33.17 21.35 33.97 965 (103) 862 15.3 12.4 9.4 NM NM NM NM NM NM 32.5% NM 22.8% 42.9%Digital River Inc. 16.55 12.87 23.06 589 (290) 299 0.8 0.8 0.7 3.7 4.3 3.8 14.4 16.4 14.6 12.5% 1.3 (3.6%) (1.9%)Blue Nile Inc. 39.38 22.94 50.00 489 (53) 436 1.3 1.1 1.0 17.3 19.6 16.3 51.1 54.1 42.5 16.5% 3.3 14.9% 13.0%Travelzoo Inc. 23.72 19.38 34.95 379 (55) 324 2.2 2.1 1.8 8.5 8.7 8.9 16.7 16.2 17.0 10.0% 1.6 5.5% 4.8%Stamps.com Inc. 22.39 18.62 33.73 368 (52) 316 3.1 2.7 2.4 14.6 11.6 9.6 16.0 14.9 12.9 20.0% 0.7 13.7% 6.0%Overstock.com Inc. 10.72 4.97 11.00 251 (43) 208 0.2 0.2 0.2 NM 8.0 6.3 NM 26.8 16.9 20.0% 1.3 4.2% 1.9%1-800-Flowers.com Inc. 3.78 2.15 4.12 244 0 245 0.3 0.3 0.3 6.4 5.4 4.6 30.8 19.9 14.7 15.0% 1.3 5.3% (1.4%)CafePress Inc. 8.52 7.68 22.69 146 (58) 87 0.5 0.4 0.4 4.8 3.6 3.1 14.7 12.9 11.7 18.5% 0.7 20.4% 26.1% Datapoints 16 16 16 15 15 15 13 13 14 16 13 16 16 Mean (3) 2.6 x 2.3 x 2.0 x 14.0 x 13.1 x 10.2 x 24.6 x 23.2 x 22.6 x 18.4% 1.4 13.9% 13.5% Median 2.2 1.8 1.5 11.0 10.8 9.6 20.9 19.6 16.9 18.5% 1.3 14.9% 13.8% Notes: Source: FactSet and Wall Street Estimates. Multiples <0 and >100 considered NM. (1) Includes convertible preferred stock with total liquidation preference of $55.0MM. 2 (2) Zillow excluded from mean calculation. (3) Demandware and HomeAway excluded from mean calculation.
  4. 4. Public Company Valuations Internet / Digital Media: Financial Metrics (Cont.)($MM, Except Per Share Data) Stock LTM EPS Price Price Range Equity Net Aggregate AV / Revenue AV / EBITDA Price / EPS Long Term Revenue Growth 10/5/12 Low High Value Debt Value CY 11A CY 12E CY 13E CY 11A CY 12E CY 13E CY 11A CY 12E CY 13E Growth PEG 12E/11A Y/Y MRQMedia Conglomerates / Selected EntertainmentComcast Corporation $36.54 $20.90 $36.98 $97,775 $32,797 $130,572 2.3 x 2.1 x 2.1 x 7.1 x 6.6 x 6.3 x 24.4 x 18.8 x 16.5 x 16.1% 1.2 11.0% 6.1%Walt Disney Co. 52.97 31.61 53.40 95,043 10,649 105,692 2.6 2.5 2.3 10.3 9.2 8.4 19.8 16.6 14.6 12.4% 1.3 4.5% 3.9%Time Warner Inc. 46.18 30.76 46.56 43,821 17,408 61,229 2.1 2.1 2.0 9.0 8.9 8.3 16.0 14.4 12.6 12.4% 1.2 0.1% (4.1%)Viacom, Inc. 55.91 39.81 56.58 28,771 7,390 36,161 2.5 2.6 2.5 8.8 8.6 8.2 14.4 12.9 11.2 14.2% 0.9 (3.6%) (13.9%)CBS Corporation 36.49 21.25 38.32 23,355 4,913 28,268 2.0 1.9 1.8 9.1 7.9 7.4 18.8 14.3 12.5 12.6% 1.1 5.2% (3.1%)Discovery Communications, Inc. 61.25 37.70 61.56 22,978 3,438 26,416 6.2 5.8 5.4 13.9 12.4 11.3 22.0 22.0 18.1 18.3% 1.2 7.8% 7.0%Sony Corporation 12.05 10.79 23.28 12,089 (1,181) 10,908 0.1 0.1 0.1 2.7 2.2 1.7 NM NM 18.7 84.0% NM 1.1% 1.0%Lions Gate Entertainment Corp. 15.62 6.76 16.19 2,256 1,379 3,635 2.3 1.6 1.4 48.7 17.9 11.7 NM 43.2 14.0 24.8% 1.7 43.7% 80.6% Mean 2.5 x 2.3 x 2.2 x 13.7 x 9.2 x 7.9 x 19.2 x 20.3 x 14.8 x 24.3% 1.2 8.7% 9.7% Median 2.3 2.1 2.0 9.0 8.7 8.3 19.3 16.6 14.3 15.2% 1.2 4.8% 2.4%PublishersNews Corp. $25.19 $15.93 $25.45 $59,278 $5,829 $65,107 1.9 x 1.9 x 1.8 x 10.1 x 9.2 x 8.5 x 19.8 x 16.3 x 13.8 x 17.3% 0.9 2.6% NAThomson Reuters Corporation 28.93 26.73 31.13 23,883 5,306 29,189 2.1 2.2 2.2 8.2 8.0 7.9 14.6 14.4 13.7 8.0% 1.8 (5.4%) (4.0%)Pearson plc 20.31 17.16 21.07 16,294 2,150 18,445 2.0 1.9 1.8 11.2 10.7 10.0 15.1 15.0 13.9 5.7% 2.6 9.3% 4.4%Gannett Co., Inc. 18.41 9.82 19.99 4,260 1,461 5,721 1.1 1.1 1.1 5.0 5.0 5.0 8.6 8.3 8.4 4.5% 1.9 0.1% (2.1%)Lagardere SCA 28.44 20.91 32.23 3,624 2,192 5,816 0.6 0.6 0.6 7.1 8.1 7.5 11.1 11.6 9.8 4.9% 2.3 (4.2%) NAUBM plc 11.86 7.20 11.93 2,908 842 3,750 2.4 2.3 2.2 10.5 10.0 9.1 12.9 12.5 11.0 10.1% 1.2 4.4% 4.8%The Washington Post Company 366.06 322.50 405.00 2,725 (231) 2,494 0.6 0.6 0.7 4.2 5.8 6.6 24.9 31.6 49.8 NA NA (6.4%) (5.1%)The New York Times Company 10.27 5.88 10.33 1,523 206 1,728 0.8 0.8 0.8 5.1 5.6 5.5 15.3 15.6 15.8 1.2% 13.0 (0.3%) 0.6%The E. W. Scripps Company 10.89 6.39 11.46 594 37 631 0.9 0.7 0.8 17.1 5.0 6.9 NM 15.6 43.6 NA NA 21.9% 18.5% Mean 1.4 x 1.3 x 1.3 x 8.7 x 7.5 x 7.4 x 15.3 x 15.6 x 20.0 x 7.4% 3.4 2.4% 2.5% Median 1.1 1.1 1.1 8.2 8.0 7.5 14.9 15.0 13.8 5.7% 1.9 0.1% 0.6%Diversified MarketingWPP plc $14.21 $9.89 $14.31 $17,951 $4,488 $22,439 1.4 x 1.3 x 1.3 x 8.8 x 8.1 x 7.6 x 12.8 x 12.0 x 11.0 x 10.2% 1.2 4.4% 3.0%Experian plc 17.35 11.72 17.40 17,174 1,966 19,140 4.2 4.0 3.7 12.6 11.9 10.9 21.8 20.7 18.8 11.3% 1.8 4.2% NAOmnicom Group Inc. 52.49 38.48 54.76 13,942 2,259 16,201 1.2 1.1 1.1 8.3 7.8 7.3 15.8 14.5 13.0 9.7% 1.5 3.0% 2.1%Publicis Groupe SA 58.24 41.75 58.58 11,461 1,160 12,621 1.7 1.5 1.4 9.3 8.2 7.6 16.6 13.7 12.7 12.0% 1.1 12.8% (0.2%)Nielsen Holdings N.V. 30.79 25.02 31.45 11,120 6,583 17,703 3.2 3.1 3.0 11.4 11.1 10.3 19.1 17.1 15.0 15.9% 1.1 2.0% (0.8%)Equifax Inc. 49.20 31.55 49.49 5,897 786 6,683 3.4 3.1 2.9 10.4 9.5 8.8 19.5 16.9 15.3 11.4% 1.5 9.5% 10.0%The Interpublic Group of Companies, Inc. 11.47 7.35 12.17 5,014 137 5,151 0.7 0.7 0.7 5.9 5.7 5.2 15.1 14.4 11.8 13.0% 1.1 1.0% (1.4%)Aegis Group plc 3.82 1.96 3.86 4,387 510 4,897 2.7 2.4 2.2 13.5 12.1 11.2 23.5 19.0 17.5 10.6% 1.8 12.4% 12.3%Havas 5.45 3.54 5.86 2,083 631 2,714 1.3 1.2 1.1 8.2 7.5 7.1 14.0 11.8 10.5 14.6% 0.8 7.9% (5.4%)Acxiom Corporation 18.05 10.73 18.99 1,354 95 1,450 1.3 1.3 1.3 5.7 6.2 6.2 27.8 24.7 23.9 11.6% 2.1 (1.6%) (1.6%)Valassis Communications Inc. 25.99 14.71 27.68 1,034 526 1,560 0.7 0.7 0.7 5.0 5.1 4.9 9.5 8.4 7.4 8.5% 1.0 (3.1%) (4.4%)Harte-Hanks Inc. 6.70 6.16 10.24 422 82 504 0.6 0.6 0.6 5.0 5.5 5.3 9.6 10.8 10.6 NM NM (4.7%) (6.5%)MDC Partners Inc. 12.79 9.41 17.84 397 400 797 0.8 0.7 0.7 9.5 7.9 6.8 NM 93.4 26.1 13.7% 6.8 13.8% 15.2% Mean 1.8 x 1.7 x 1.6 x 8.7 x 8.2 x 7.6 x 17.1 x 21.3 x 14.9 x 11.9% 1.8 4.7% 1.8% Median 1.3 1.3 1.3 8.8 7.9 7.3 16.2 14.5 13.0 11.5% 1.3 4.2% (0.5%) Notes: 3 Source: FactSet and Wall Street Estimates. Multiples <0 and >100 considered NM.
  5. 5. Public Company Valuations Internet / Digital Media: Financial Metrics (Cont.)($MM, Except Per Share Data) Stock LTM EPS Price Price Range Equity Net Aggregate AV / Revenue AV / EBITDA Price / EPS Long Term Revenue Growth 10/5/12 Low High Value Debt Value CY 11A CY 12E CY 13E CY 11A CY 12E CY 13E CY 11A CY 12E CY 13E Growth PEG 12E/11A Y/Y MRQGamingTencent Holdings Ltd. $34.05 $18.03 $34.67 $62,414 ($3,037) $59,376 1.7 x 1.1 x 0.9 x 3.5 x 2.6 x 2.1 x 4.9 x 3.8 x 3.0 x 22.8% 0.2 52.5% 58.9%Activision Blizzard, Inc. 11.30 10.98 14.40 12,555 (3,192) 9,363 2.1 2.0 2.0 6.1 5.6 5.2 12.2 11.2 10.4 11.9% 0.9 4.1% (6.2%)NHN Corporation 255.27 179.05 263.84 11,444 (834) 10,610 5.5 4.9 4.2 16.5 15.4 12.2 29.7 26.0 20.4 19.5% 1.3 12.6% 3.0%NetEase, Inc 53.82 40.63 65.54 7,048 (2,258) 4,790 4.1 3.6 3.1 8.3 7.3 6.3 13.7 12.1 10.7 14.1% 0.9 15.4% 15.2%DeNA Co., Ltd. 33.67 17.69 46.63 4,763 (731) 4,032 2.3 1.7 1.5 4.9 4.2 3.8 11.5 9.4 8.3 12.4% 0.8 32.3% 38.6%Gree, Inc. 18.72 13.34 36.09 4,384 (692) 3,692 2.6 1.7 1.5 5.0 3.6 3.3 10.3 7.2 6.9 7.7% 0.9 52.9% 178.3%NCsoft Corporation 220.09 183.11 348.18 4,371 ($321) 4,051 7.4 5.7 4.2 26.8 18.8 9.0 41.6 32.1 14.4 48.7% 0.7 30.8% (17.7%)Electronic Arts Inc. 12.95 10.77 26.13 4,123 (895) 3,228 0.8 0.8 0.7 5.8 5.0 4.5 16.0 12.8 10.8 15.4% 0.8 2.1% (4.4%)Zynga, Inc. 2.48 2.21 15.91 1,884 (1,117) 767 0.7 0.6 0.7 2.5 4.4 5.0 10.3 57.7 54.0 14.8% 3.9 2.4% 36.9%Changyou.com Limited 25.65 17.00 33.84 1,354 (444) 909 1.5 1.5 1.3 3.1 2.6 2.4 5.7 5.0 4.6 10.4% 0.5 (3.1%) 40.3%Giant Interactive Group, Inc. 5.29 3.32 5.66 1,254 (314) 939 3.3 2.8 2.4 5.2 4.4 3.9 7.1 6.8 6.2 12.1% 0.6 17.8% 23.2%Shanda Games Limited 3.66 3.16 5.92 1,026 (128) 898 0.8 0.9 0.9 2.3 2.4 2.4 3.7 3.8 3.6 8.4% 0.5 (9.3%) (12.9%)Ubisoft Entertainment SA 8.21 5.03 8.56 777 (130) 646 0.5 0.4 0.4 1.4 1.2 1.1 27.8 13.9 11.9 18.5% 0.8 9.2% (1.8%)Perfect World Co., Ltd. 10.72 8.44 17.46 518 (101) 417 0.9 1.0 0.9 2.3 3.2 2.7 3.5 4.7 3.9 6.5% 0.7 (8.1%) (11.7%)Glu Mobile, Inc. 4.00 2.11 5.90 261 (25) 236 3.2 2.5 1.8 NM NM 11.8 NM NM 22.6 30.0% NM 31.4% 33.6% Mean 2.5 x 2.1 x 1.8 x 6.7 x 5.8 x 5.1 x 14.2 x 14.7 x 12.8 x 16.9% 1.0 16.2% 24.9% Median 2.1 1.7 1.5 5.0 4.3 3.9 10.9 10.3 10.4 14.1% 0.8 12.6% 15.2%Social Media & New PlatformFacebook, Inc. $20.91 $17.55 $45.00 $44,797 ($9,482) $35,315 9.5 x 7.2 x 5.6 x 15.5 x 13.3 x 10.2 x 42.4 x 43.1 x 34.2 x 22.8% 1.9 32.2% NALinkedIn Corporation 118.83 55.98 125.50 12,561 (617) 11,944 22.9 12.8 8.6 NM 61.7 35.7 NM NM 92.2 60.0% NM 78.2% 88.5%Groupon, Inc. 5.25 4.00 31.14 3,432 (1,190) 2,242 1.4 1.0 0.8 NM 7.4 5.8 NM 28.5 14.6 24.5% 1.2 44.9% 44.8%Yelp, Inc. 28.40 14.10 31.96 1,739 (123) 1,616 19.4 11.9 8.1 NM NM 79.9 NM NM NM 15.0% NM 63.4% 66.8%Pandora Media, Inc. 10.29 7.83 26.00 1,738 (82) 1,655 6.3 4.0 2.8 NM NM 76.5 NM NM NM NM NM 58.3% 51.2% Mean 11.9 x 7.4 x 5.2 x NM 27.5 x 41.6 x NM 35.8 x 47.0 x 30.6% 1.5 55.4% 62.8% Median 7.9 5.6 4.8 NM 10.3 23.0 NM 28.5 24.4 24.5% 1.9 60.9% 66.8%Media SaaSExactTarget, Inc. $23.98 $18.53 $29.88 $1,584 ($212) $1,372 6.6 x 4.9 x 4.0 x NM NM 77.3 x NM NM NM 25.2% NM 34.7% 41.9%Bazaarvoice, Inc. 15.75 12.96 21.10 1,088 (143) 945 10.1 6.8 5.2 NM NM NM NM NM NM 0.0% NM 48.5% 61.5%Demandware, Inc. 33.17 21.35 33.97 965 (103) 862 15.2 11.5 8.7 NM NM NM NM NM NM 32.5% NM 32.7% 42.9%Jive Software, Inc. 14.81 13.50 28.15 922 (145) 777 13.8 6.9 5.1 NM NM NM NM NM NM 35.0% NM 98.8% 50.7%Constant Contact, Inc. 17.41 15.66 32.18 531 (81) 450 2.1 1.8 1.5 12.5 12.3 9.0 24.5 33.0 21.0 45.2% 0.7 18.2% 18.2%Brightcove, Inc. 13.37 10.81 25.50 366 (54) 312 4.9 3.6 3.0 NM NM NM NM NM NM NA NA 35.1% 41.5%Digital Generation, Inc. 11.28 7.51 20.72 311 399 710 2.2 1.8 1.7 5.4 5.5 5.1 12.8 26.4 19.3 16.7% 1.6 22.1% 42.0%KIT digital, Inc. 2.64 2.57 12.65 151 (16) 135 0.6 0.6 0.5 2.8 NM 3.3 NM NM NM 23.0% NM 3.8% 13.8% Mean 6.9 x 4.7 x 3.7 x 6.9 x 8.9 x 23.7 x 18.7 x 29.7 x 20.1 x 25.4% 1.2 36.7% 39.0% Median 5.8 4.3 3.5 5.4 8.9 7.0 18.7 29.7 20.1 25.2% 1.2 33.7% 42.0% Notes: 4 Source: FactSet and Wall Street Estimates. Multiples <0 and >100 considered NM.
  6. 6. Recent AcquisitionsInternet / Digital Media: Trailing 6 Months($MM) Announced AV / LTM AV / LTM AV / NTM AV / NTM Acquirer Target Aggregate Value Date Sales EBITDA Sales EBITDA (1) 9/20/2012 $566 2.0x 12.6x 1.6x 9.3x 8/26/2012 $300 NA NA NA NA (2) 8/21/2012 ~$62 NA NA NA NA 8/10/2012 ~$92 NA NA NA NA (3) 7/31/2012 $350 NA NA NA NA 7/19/2012 $116 NA NA NA NA 7/17/2012 $60 NA NA NA NA (4) 7/12/2012 $5,084 2.9x 16.0x 2.5x 12.9x 7/9/2012 ~$70 NA NA NA NA 7/2/2012 $670 5.4x 12.0x NA 11.0x (5) 6/29/2012 ~$176 NA NA NA NA (6) 6/25/2012 $1,200 ~54.0x NA NA NA 6/20/2012 $540 2.9x NA 2.3x 12.9x Notes: Multiples <0x or >100x considered NM. Disclosed transactions with Aggregate Value <$50MM not included. (1) Avg. 9/20/2012 USD/EUR FX rate of 1.2947 used to convert €437MM purchase price. NTM multiples use 2013 estimates. (2) Avg. 8/21/2012 USD/EUR FX rate of 1.2474 used to convert €50MM purchase price. (3) Excludes $100MM of earnout and retention payments. (4) Avg. 7/12/2012 USD/GBP FX rate of 1.5443 used to convert £3,164MM purchase price. 5 (5) Avg. 6/29/2012 USD/EUR FX rate of 1.2590 used to convert €140MM purchase price. (6) LTM revenue multiple based on IDC estimates for CY2011.
  7. 7. Recent AcquisitionsInternet / Digital Media: Trailing 6 Months (Cont.)($MM) Announced AV / LTM AV / LTM AV / NTM AV / NTM Acquirer Target Aggregate Value Date Sales EBITDA Sales EBITDA 6/18/2012 $100 NA NA NA NA (1) 6/13/2012 ~$100 NA NA NA NA 6/12/2012 $135 NA NA NA NA 6/4/2012 ~$100 NA NA NA NA (2) 6/4/2012 ~$363 NA NA NA NA (3) 6/4/2012 $745 ~29.8x NA ~14.9x NA (4) 6/1/2012 $133 5.5x 6.9x NA NA 5/24/2012 $152 NA NA NA NA 5/23/2012 NA NA NA NA NA (5) 5/22/2012 $71 2.2x NM NA NA (6) 5/14/2012 $332 1.1x 12.1x 1.0x 7.8x 5/10/2012 $175 0.6x NA NA NA (7) 5/7/2012 $76 2.1x 5.9x 1.6x 5.7x Notes: Multiples <0x or >100x considered NM. Disclosed transactions with Aggregate Value <$50MM not included. (1) Includes $5MM cash and equity earnout for employee retention and $30MM tied to revenue targets. (2) Avg. 6/4/2012 USD/PLN FX rate of 0.2849 used to convert 1,275MM PLN purchase price; implied Aggregate Value based on acquisition of 75% stake. (3) Assumes revenue of ~$25MM for CY2011 (LTM) and ~$50MM for CY2012 (NTM), based on Salesforce.com public disclosures. (4) Avg. 6/1/2012 USD/GBP FX rate of 1.5307 used to convert £87MM purchase price. (5) Includes $1.092 per common share, assumption of debt and payment of an amount equal to the redemption price of the preferred shares. 6 (6) Avg. 5/14/2012 USD/EUR FX rate of 1.2863 used to convert €258MM purchase price. (7) Avg. 5/7/2012 USD/EUR FX rate of 1.3033 used to convert €59MM purchase price.
  8. 8. Recent AcquisitionsInternet / Digital Media: Trailing 6 Months (Cont.)($MM) Announced AV / LTM AV / LTM AV / NTM AV / NTM Acquirer Target Aggregate Value Date Sales EBITDA Sales EBITDA 5/3/2012 $119 NA NA NA NA 5/1/2012 $210 NA NA NA NA 4/27/2012 $424 NA NA NA NA 4/25/2012 $100 NA NA NA NA (1) 4/9/2012 2 Subsidiaries $554 NA NA NA NA 4/11/2012 Undisclosed NA NA NA NA 4/9/2012 $1,000 NA NA NA NA Notes: Multiples <0x or >100x considered NM. Disclosed transactions with Aggregate Value <$50MM not included. 7 (1) Avg. 4/9/2012 USD/CNY FX rate of 0.1580 used to convert Hangzhou Bianfeng Networking Co., Ltd. Purchase price of CNY 3.14Bn and Shanghai Haofang Online Information Technology Co., Ltd. purchase price of CNY 352MM.
  9. 9. Filed IPOs Internet / Digital Media: IPOs In RegistrationFor the period 1/1/2010 to 10/09/2012Offering Amounts $10MM or Greater Initial Filing Initial Offering Major Shareholders Issuer Primary Industry Underwriters Date Amount ($MM) (% ownership prior to offering) Automotive / Online Providence Equity (25%); Cox Enterprises Inc (100% of Class ShutterStock Images LLC 06/15/12 300 GS; MS; Allen & Co; Barclays; Citi; 8 Others Marketplace B Shares) eCommerce / Online 05/14/12 115 MS; DB; Jefferies; RBC; Stifel; William Blair Pixel Holdings (65.1%); Insight Venture Partners (24.4%) Marketplace Exponential Interactive Inc Online Advertising 03/16/12 75 Citi; BAML; RBC; ThinkEquity Dilip DaSilva (74.9%); Housatonic Partners (9.5%) GSR Ventures (29.9%); Richmond Global (14.9%); Universe Adchina Ltd Online Advertising 02/17/12 100 Goldman Sachs; Credit Suisse Access Enterprises (12.4%); Norwest (10.9%) GameFly Inc eCommerce 02/10/10 50 BAML; Piper Jaffray; William Blair; Cowen Sequoia (51.3%); Tenaya Capital (5.9%) 8 Notes: Source: Dealogic, CapitalIQ and SEC.gov.
  10. 10. Venture Capital Activity TMT: Transactions Since 2001 10 $19.5Bn 1,600 9 1,400 8 7 $16.9Bn 1,200 Number of Investments 6 (1) 1,000$Bn 5 800 4 3 600 2 400 1 0 200 Q1 01 Q2 01 Q3 01 Q4 01 Q1 02 Q2 02 Q3 02 Q4 02 Q1 03 Q2 03 Q3 03 Q4 03 Q1 04 Q2 04 Q3 04 Q4 04 Q1 05 Q2 05 Q3 05 Q4 05 Q1 06 Q2 06 Q3 06 Q4 06 Q1 07 Q2 07 Q3 07 Q4 07 Q1 08 Q2 08 Q3 08 Q4 08 Q1 09 Q2 09 Q3 09 Q4 09 Q1 10 Q2 10 Q3 10 Q4 10 Q1 11 Q2 11 Q3 11 Q4 11 Q1 12 Q2 12 Year - Quarter (2) (2) (3) TMT VC-Backed IPO Exit Value TMT VC-Backed M&A Exit Value Number of TMT VC Investments Notes: (1) Includes Facebook IPO at Exit Value of $16.0Bn. (2) TMT VC-Backed IPO Exits and TMT VC-Backed M&A Exits per NVCA / Thomson Venture-Backed Exit Activity report. TMT Inclusive of: Internet Specific, Communications & Media, Computer Software & Services, Semiconductors/Other Electronics, Computer Hardware. (3) Number of TMT VC Investments per PriceWaterhouseCoopers / NVCA MoneyTree report. TMT inclusive of: Computers and Peripherals, 9 Electronics / Instrumentation, IT Services, Media and Entertainment, Networking and Equipment, Semiconductors, Software and Telecommunications.
  11. 11. Private Financing Activity Internet / Digital Media: Monthly Since January 2007(1) 30 1,250 25 1,000Number of Financings 20 (1) 750 $MM 15 500 10 250 5 0 0 Feb-07 Mar-07 Apr-07 May-07 Feb-08 Mar-08 Apr-08 May-08 Feb-09 Mar-09 Apr-09 May-09 Feb-10 Mar-10 Apr-10 May-10 Feb-11 Mar-11 Apr-11 May-11 Feb-12 Mar-12 Apr-12 May-12 Jan-07 Jun-07 Jul-07 Aug-07 Sep-07 Nov-07 Dec-07 Jan-08 Jun-08 Jul-08 Aug-08 Sep-08 Nov-08 Dec-08 Jan-09 Jun-09 Jul-09 Aug-09 Sep-09 Nov-09 Dec-09 Jan-10 Jun-10 Jul-10 Aug-10 Sep-10 Nov-10 Dec-10 Jan-11 Jun-11 Jul-11 Aug-11 Sep-11 Nov-11 Dec-11 Jan-12 Jun-12 Jul-12 Aug-12 Sep-12 Oct-07 Oct-08 Oct-09 Oct-10 Oct-11 Amount Raised ($MM) Am ount Rai ed ( $M M ) s Number of Financings N ber of Fi anci gs um n n Notes: Source: DowJones VentureWire. Only financings > $10MM included. 10 (1) Chart excludes Groupon’s $377MM raise on 12/29/10 and Facebook’s $1.5Bn raise on 1/21/11. Actual amounts raised in the months of 12/2010 and 1/2011 are $1,032MM and $2,105MM respectively.
  12. 12. Recent Private Financings Internet / Digital Media: Trailing 6 Weeks($MM) Announced TotalName Date Series Amount Lead Investor Other Investors Brief Business Description RaisedRap GeniusBrooklyn, NY 3-Oct-12 Series A $15 Andreessen Horowitz Fenox Venture Capital, Y Combinator Provider of a rap lyrics interpretation website $15www.rapgenius.comBetterment LLC Provider of an online investment service that allows individuals to invest inNew York, NY 3-Oct-12 Series B $10 Menlo Ventures Bessemer Venture Partners, Anthemis Group $13 stock and bond portfolioswww.betterment.comThredUP Trinity Ventures, Redpoint Ventures, Founder Collective,San Francisco, CA 3-Oct-12 Series C $15 Highland Capital Partners Provider of an online platform for swapping children’s accessories $23 NextView Ventures, High Line Ventureswww.thredup.comGravity Provider of a conversation engine that allows people with shared interest toSanta Monica, CA 2-Oct-12 Series B $11 GRP Partners August Capital, Redpoint Ventures $21 engage in meaningful and fun conversations onlinewww.gravity.comOppa Design Ltda.Sao Paulo, Brazil 2-Oct-12 Series A $13 Valar Ventures Thrive Capital, Monashees Capital, Kaszek Ventures Operator of an e-commerce platform of contemporary furniture in Brazil $13www.oppa.com.brRamp Inc. Hearst Interactive Media, EDBI, Fairhaven Capital, AccelBoston, MA 27-Sep-12 Series C $15 StarVest Partners Partners, General Catalyst Partners, Comcast Ventures, BBN Provider of search and publishing solutions for online content $40www.ramp.com TechnologiesWeddingWire Catalyst Investment, MarthaStewart.com, Southern Capitol Developer of an online service that allows users to search, compare, and bookBethesda, MA 25-Sep-12 Series B $25 Spectrum Equity NA Ventures local wedding vendorswww.weddingwire.comMedallia Provides software-as-a-service customer experience and enterprise feedbackPalo Alto, CA 26-Sep-12 Series A $35 Sequoia Capital NA $35 management solutionswww.medallia.comDataminr Deep Fork Capital, GSV Capital, Viceroy Capital, WhartonNew York, NY 24-Sep-12 Series B $13 NA Turns tweets into high-frequency trading news $17 Equity Partnerswww.dataminr.comMobli Provides a real-time visual media platform made up of subject-based channels,Ramat Gan, Israel 20-Sep-12 Series B $22 NA NA $26 such as people, places, and topicswww.mobli.comMoPubSan Francisco, CA 20-Sep-12 Series B $12 Jafco Ventures Accel Partners, Angel Pad, Harrison Metal Capital, Iris Capital Provider of marketing services for publishers of mobile applications NAwww.mopub.comTwitch Inc.San Francisco, CA 19-Sep-12 Series A $15 Bessemer Venture Partners Alsop Louie Partners, Draper Associates, Y Combinator Provider of an online network for broadcasting and viewing live video NAwww.twitch.tv Notes: 11 Source: DowJones VentureWire. Only financings > $10MM included..
  13. 13. Recent Private Financings Internet / Digital Media: Trailing 6 Weeks (Cont.)($MM) Announced TotalName Date Series Amount Lead Investor Other Investors Brief Business Description RaisedDuolingo Inc. Provider of a free language education website and crowd-sourced onlinePittsburgh, PA 17-Sep-12 Series B $15 New Enterprise Associates Union Square Ventures $18 translation servicewww.duolingo.comEdo Inc. Baird Venture Partners, Claritas Capital, Clayton Associates, Provider of digital and mobile advertising solutions for everyday paymentNashville, TN 13-Sep-12 Series C $15 VantagePoint Capital Partners $54 First Avenue Equities, Nashville Capital Network networks to connect brands with consumerswww.edointeractive.comBigcommerce Pty Ltd.Austin, TX 5-Sep-12 Series B $20 NA General Catalyst Partners, Floodgate Provider of e-commerce software to online retailers and merchants $35www.bigcommerce.comDesire2LearnKitchener, Canada 4-Sep-12 Series A $80 NA New Enterprise Associates, OMERS Ventures Provider of online learning solutions $80www.desire2learn.comNuvoTV (SiTV Inc.) Echostar, Rho Ventures, Time Warner, Veronis SuhlerGlendale, CA 30-Aug-12 NA $40 NA Stevenson, Barshop Ventures, Columbia Capital, Syncom Provider of original English-language programs for Latinos in the United States NAwww.mynuvotv.com Venture Partners, Tennenbaum Capital PartnersDelivery Hero Hasso Plattner Ventures, Holtzbrinck Ventures, Kite Ventures,Berlin, Germany 29-Aug-12 Series D $49 NA Kreos Capital, Point Nine Management, ru-Net Ventures, Team Provider of an online food-ordering platform $98www.deliveryhero.com Europe Ventures, Tengelmann E-Commerce BeteiligungVision Critical Communications Provider of customer advisory panels and interactive research to helpVancouver, Canada 28-Aug-12 Series B $20 OMERS Ventures TELUS Ventures, Wellington Financial $23 organizations engage their customerswww.visioncritical.com Notes: 12 Source: DowJones VentureWire. Only financings > $10MM included.
  14. 14. GCA Savvian Advisors Overview Selected Recent Digital Media Transactions Sale of Acquired by Acquired by Acquired by Preferred Stock Acquired by Acquired by Acquired by Acquired by toFairness Opinion for Buddy Media We Advised the Seller We Advised the Seller Financial Advisor We Advised the Seller We Advised the Seller We Advised the Seller We Advised the Seller We Advised the Seller August 2012 August 2012 June 2012 June 2012 May 2012 May 2012 March 2012 February 2012 January 2012 Acquired by Acquired by Preferred Stock Acquired by Acquired by Preferred Stock Preferred Stock Acquired by Acquired by We Advised the Seller We Advised the Seller Financial Advisor We Advised the Seller We Advised the Seller We Advised the Seller Financial Advisor We Advised the Seller Financial Advisor December 2011 December 2011 November 2011 October 2011 October 2011 September 2011 August 2011 August 2011 August 2011 Merger with Acquired By Preferred Stock Acquired By Acquired By Sale of Subscription Acquisition of JV from Sale of Business Unit Secondary Music Service to Mogae Consultants Six Apart KK to Sale We Advised the Seller Financial Advisor We Advised lolapps We Advised the Seller We Advised the Seller We Advised the Seller We Advised the Buyer We Advised the Seller We Advised the Founders August 2011 July 2011 July 2011 May 2011 April 2011 March 2011 January 2011 January 2011 January 2011 Preferred Stock Acquired by Acquisition of Preferred Stock Acquired by Preferred Stock Acquired by Acquired by Acquired by Financial Advisor We Advised the Seller We Advised the Buyer Financial Adviser We advised the seller Financial Advisor We Advised the Seller We Advised the Seller We Advised the Seller December 2010 December 2010 November 2010 October 2010 October 2010 August 2010 July 2010 June 2010 June 2010 Sold Stake in Acquired by Acquired by Preferred Stock Acquired by Preferred Stock Preferred Stock Minority Preferred Preferred Stock a Subsidiary of Investment in to We Advised the Seller We Advised the Seller Financial Advisor We Advised the Seller Financial Advisor We Advised the Seller Financial Advisor Financial Advisor We Advised the Seller June 2010 January 2010 October 2009 April 2009 February 2009 January 2009 November 2008 November 2008 October 2008 13
  15. 15. GCA Savvian Advisors Digital Media Team San Francisco New York Tokyo th 150 California St., Ste. 2300 1330 Ave. of the Americas, 28 Fl. 11-1 Marunouchi 1-chome San Francisco, CA 94111 New York, NY 10019 Chiyoda-ku, Tokyo 100-6230 United States United States Japan Phone: (415) 318-3600 Phone: (212) 999-7090 Phone: +81 (3) 6212-7100 Dean Asofsky Alex Chefetz Steve Fletcher Mark Greenbaum Rich Jasen Managing Director Managing Director Managing Director Managing Director Managing Director Phone: (212) 999-7077 Phone: (212) 999-7084 Phone: (415) 318-3661 Phone: (415) 318-3656 Phone: (415) 318-3653 Mobile: (917) 902-1082 Mobile: (917) 972-7756 Mobile: (415) 518-6725 Mobile: (415) 531-6020 Mobile: (415) 308-4760dasofsky@gcasavvian.com achefetz@gcasavvian.com sfletcher@gcasavvian.com mgreenbaum@gcasavvian.com rjasen@gcasavvian.comTomohiko Kubota Sachio Kuninori John Lambros Ashley Ma Joshua Wepman Vice President Executive Director Managing Director Vice President DirectorPhone: +81 (3) 6212-7129 Phone: +81 (3) 6212-7226 Phone: (212) 999-7083 Phone: (212) 999-7076 Phone: (212) 999-7092 tkubota@gcakk.com skuninori@savviankk.com Mobile: (917) 744-9011 Mobile: (917) 575-0103 Mobile: (917) 306-4168 jlambros@gcasavvian.com ama@gcasavvian.com jwepman@gcasavvian.com 14

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