Web 2.0 Weekly - Oct. 20, 2009

SOFTWARE & SERVICES

20 OCTOBER 2009

DAVID SHORE, CFA, MBA 416.860.6784

WEB 2.O WEEKLY

[email protected] Damian Wojcichowsky, CFA (Associate), 416.860.7652

GAMING AND ENTERTAINMENT ATTRACTING MORE CASH SO CI AL N ET W OR K S T H E PL AT F O RM F O R A N E X P L O SIO N OF ON L I NE ENT E RT A IN ME NT Among the spaces most touched by W eb 2.0 is entertainment (and specifically online gaming). This week’s W eb 2.0 W eekly illustrates the recent attraction of the venture funding community to video, gaming, and social networking. Key highlights include: •

Gaming companies are second to Social Networking in number of companies funded in the past three months.

•

Seven of the top 10 share price gainers in the week were gaming-related companies.

•

As we highlighted in the last issue, the value of virtual goods market – indelibly a function of social games, such as Farmville – is expected to exceed $1 billion next year.

•

Social games are among the fastest growing online user populations. For example, Café World (a Zynga game) reached more than 10 million monthly active users since its October 2, 2009 launch.

F OL L O W T H E U S E RS … Several reasons for the rapid explosion in online gaming interest: (1) Broadband streaming of video has vastly improved the quality and entertainment value of gaming offerings. (2) Tie-in with Social Networks, such as Facebook, provides exposure for the myriad third-party game developers to massive and growing user bases who represent high-value target consumers in terms of percentage of time spent online and level of interest in video games. (3) If the online form of entertainment involves good content, users have demonstrated that consumption will occur wherever it is available. This type of consumption allows for far greater volume of use than conventional gaming. Capital Market Activity by Sector - Last Three Months 200.0 180.0 160.0 140.0

(US$m)

120.0 100.0 80.0 60.0 40.0

67.1

46.0

39.4

37.9

35.5

34.0

26.1

17.1

17.1

15.8

14.0

13.2

9.0

6.0

3.9

2.8

2.0

1.3

0.4

Social Networks

Video

Infrastructure

Advertising

Crowdsourced Content

Music

Search

Enterprise

Collaboration

Virtual World

Mobile

Comment/Reputation

Advertising/Mobile

Analytics

Media

Social Commerce

Aggregation

Mobile Ad

Online Learning

Classified

116.5

100.0

Vertical Communities

96.4

Gaming

192.3

3

0.0

Microblog

2,025.0 SMS/Voice

20.0

8

1

11

6

4

7

4

5

3

4

3

3

5

2

1

3

1

1

1

1

1

1

# companies 1

This report has been created b y Anal ysts that are emplo yed b y Research Capital Corporation, a Canadian Investment Dealer. For further disclosures, please see last page of this report. T o ro n t o 4 1 6 . 8 6 0 . 7 6 0 0

Montreal 514.399.1500

w w w . r e s e a rc h c a p i t a l . c o m Vancouver 604.662.1800

Calgary 403.265.7400

Regina 306.566.7550

Page 2

THE WEB 2.0 UNIVERSE Eighty-nine public Web 2.0 companies: Our W eb 2.0 universe contains 89 companies, with a combined market cap of approximately $72 billion (Figure 1). The median market cap for the group is $43 million, with average trailing revenue of $161 million (median $43 million). The companies are also generally profitable with a median EBITDA margin of 12.5%. On a valuation basis, the overall average is 4.6x trailing revenue (median 1.9x) and 11.8x trailing EBITDA (median 10.4x). Twenty of the companies have more than 500 employees. C omparable C ompany Analys is > Web 2.0 C ompany Name

L TM as of Tic ker

E xc hange

Accelerize New Media, Inc. Actoz S oft C o. , Ltd. AQ Interactive, Inc. As s ociated Media Holdings Inc. B igs tring C orp. B etawa ve C orporation B eyond C ommerce, Inc. B right T hings plc B roadW ebAs ia Inc. C DC C orp. C hangyou. com Limited C hina G ateway C orporation C hines e G amer Interna tional C L IC K E R Inc. C ornerW orld C orporation C yberplex Inc. DADA S pA DX N Holdings B hd Dibz Internationa l, Inc. DigitalP os t Interactive, Inc. DigitalT own, Inc. Dolphin Digita l Media, Inc. E olith C o. Ltd. E xtens ions , Inc. F luid Mus ic C a nada, Inc. F rogs ter Interactive P ictures AG G a mania Digital E nterta inment C o. , Ltd. G a meO n C o Ltd. G eoS entric O yj G iant Interactive G roup, Inc. G igaMedia Ltd. G ravity C o., Ltd G ree, Inc. G ungHo O nline E ntertainment, Inc. Ha nbitS oft, Inc. IAC /InterActiveC orp. IAS E nergy, Inc. is eemedia Inc. J umbuck E ntertainment Limited K AB Dis tribution Inc. K ings oft C o. L td. Lingo Media C orpora tion LiveW orld Inc. LookS mart, Ltd. Magnitude Information S ys tems Inc. Mixi, Inc. Modern T imes G roup Mtg AB MOK O . mobi L imited Myriad G roup AG NE O W IZ G ames C orpora tion NetDra gon W ebS oft, Inc. Neteas e.com Inc. NeuLion Incorporated NeXplore C orporation Ngi G roup Inc. Northgate T echnologies L imited Open T ext C orp. Openwave S ys tems Inc. P erfect W orld C o., Ltd. P NI Digita l Media Inc. Quepas a C orp. OAO R B C Information S ys tems S handa Interactive E nterta inment Ltd. S hutterfly, Inc. S K C ommunications C o., Ltd. S NAP Interactive, Inc. S NM G loba l Holdings S ocial Media V entures Inc. S ocialwis e, Inc. S ohu.com Inc. S park Networks , Inc. S pectrumDNA, Inc. T encent Holdings Ltd. T he P arent C ompany T he9 L imited T heS treet.com, Inc. T ree. C om, Inc. Unis erve C ommunications C orp. United Online Inc. UO MO Media, Inc V a lueC lick Inc. V O IS , Inc. W ebzen Inc. W izzard S oftware C orporation W orlds .com Inc. W ynds torm C orporation XING AG Y D O nline C orp. Y nk K orea Inc.

6/30/2009 6/30/2009 6/30/2009 6/30/2007 6/30/2009 6/30/2009 6/30/2009 3/31/2009 9/30/2008 6/30/2009 6/30/2009 9/30/2008 6/30/2009 5/31/2009 7/31/2009 6/30/2009 6/30/2009 5/31/2009 NA 6/30/2009 8/31/2009 6/30/2009 12/31/2008 6/30/2009 6/30/2009 6/30/2009 6/30/2009 6/30/2009 6/30/2009 6/30/2009 3/31/2009 6/30/2009 6/30/2009 6/30/2009 6/30/2009 6/30/2009 4/30/2009 3/31/2009 6/30/2009 6/30/2009 6/30/2009 6/30/2009 6/30/2009 6/30/2009 6/30/2009 6/30/2009 6/30/2009 6/30/2009 6/30/2009 12/31/2008 6/30/2009 6/30/2009 6/30/2009 6/30/2009 6/30/2009 6/30/2009 6/30/2009 6/30/2009 6/30/2009 6/30/2009 6/30/2009 12/31/2007 6/30/2009 6/30/2009 12/31/2008 6/30/2009 9/30/2008 12/31/2008 6/30/2009 6/30/2009 6/30/2009 6/30/2009 6/30/2009 8/2/2008 12/31/2008 3/31/2009 6/30/2009 5/31/2009 6/30/2009 7/31/2009 6/30/2009 6/30/2009 6/30/2009 6/30/2009 6/30/2009 NA 6/30/2009 12/31/2007 12/31/2008

OT C B B K OS E TS E OT C P K OT C B B OT C B B OT C B B AIM OT C P K Nas daqG S Nas daqG S OT C P K GTS M OT C B B OT C B B TS X CM K LS E OT C P K OT C B B OT C B B OT C B B K OS E OT C P K TS X XT R A GTS M TS E HLS E NY S E Nas daqG S Nas daqG M TS E OS E K OS E Nas daqG S OT C B B TS XV AS X TS X S E HK TS XV OT C P K Nas daqG M OT C B B TS E OM AS X SWX K OS E S E HK Nas daqG S TS X OT C P K TS E BS E Nas daqG S Nas daqG S Nas daqG S TS XV OT C B B RTS Nas daqG S Nas daqG S K OS E OT C B B OT C P K OT C P K OT C B B Nas daqG S AME X OT C B B S E HK OT C P K Nas daqG S Nas daqG M Nas daqG M TS XV Nas daqG S OT C B B Nas daqG S OT C B B Nas daqG M AME X OT C B B OT C P K XT R A K OS E K OS E

High Low Average Median

Figure 1. Web 2.0 Universe Summary Source. Capital IQ

AC LZ A052790 3838 AS MH BSGC B W AV B Y OC AIM:B G T BWBA C HIN. A C Y OU CGW Y G T S M: 3083 C LK Z CWR L T S X :C X C M:DA DXN DIB Z DG LP DG T W DP DM A041060 E XT I T S X :F MN FR G 6180 3812 G E O 1V GA G IG M GRVY T S E : 3632 3765 A047080 IAC I IAS A. E IE E AS X :J MB T S X :K AB 3888 T S X V :LM LV W D LO OK MAG Y 2121 MT G B MK B MY R N A095660 777 NT E S T S X :NLN NXP C 2497 590057 OTE X OP W V PWR D T S X V :P N QP S A R BCI S NDA S F LY A066270 S TVI S NMN S MV I S C LW S OHU LO V S P XA 700 K IDS . Q NC T Y TSCM TRE E T S X V :U S S U NT D U OMO V C LK V OIS W ZE N W ZE W DDD W Y ND O 1B C A052770 A023770

Trading C urrency HQ US D KRW JPY US D US D US D US D GBP US D US D US D US D TWD US D US D C AD E UR MY R US D US D US D US D KRW US D C AD E UR TWD JPY E UR US D US D US D JPY JPY KRW US D US D C AD AU D C AD HK D C AD US D US D US D JPY SEK AU D C HF KRW HK D US D C AD US D JPY INR US D US D US D C AD US D US D US D US D KRW US D US D US D US D US D US D US D HK D US D US D US D US D C AD US D US D US D US D US D US D US D US D E UR KRW KRW

U nited S ta tes S outh K orea J apan U nited S ta tes U nited S ta tes U nited S ta tes U nited S ta tes U nited K ingdom U nited S ta tes Hong K ong C hina U nited S ta tes T aiwan U nited S ta tes U nited S ta tes C anada Italy Malays ia U nited S ta tes U nited S ta tes U nited S ta tes U nited S ta tes S outh K orea U nited S ta tes U nited S ta tes G ermany T aiwan J apan F inland C hina T aiwan S outh K orea J apan J apan S outh K orea U nited S ta tes C anada C anada Aus tralia C anada C hina C anada U nited S ta tes U nited S ta tes U nited S ta tes J apan S weden Aus tralia S witzerland S outh K orea C hina C hina C anada U nited S ta tes J apan India C anada U nited S ta tes C hina C anada U nited S ta tes R us s ia C hina U nited S ta tes S outh K orea U nited S ta tes U nited S ta tes U nited S ta tes U nited S ta tes C hina U nited S ta tes U nited S ta tes C hina U nited S ta tes C hina U nited S ta tes U nited S ta tes C anada U nited S ta tes C anada U nited S ta tes U nited S ta tes S outh K orea U nited S ta tes U nited S ta tes U nited S ta tes G ermany S outh K orea S outh K orea

C urrent Pric e 0. 55 15, 600 49, 000 0. 01 0. 04 0. 04 0. 11 0. 01 0. 03 2. 53 31. 72 0. 00 475 0. 01 0. 06 1 7. 69 0. 65 0. 00 0. 06 1. 50 0. 38 605 0. 16 1. 38 20. 50 50. 00 90, 100 0. 05 8 4. 81 1. 64 4, 840 217, 500 4, 085 19. 18 0. 10 0. 14 0. 38 0 8 0. 94 0. 04 1. 20 0. 01 640000. 00 329. 00 0. 08 4. 50 37050. 00 5 39. 36 0. 81 1 28200. 00 36. 30 40. 92 2. 53 44. 96 1. 75 1 1. 50 49. 38 15. 92 8210. 00 0 0. 00 0 0. 61 69. 99 2 0 145 0. 01 8. 89 3. 00 7. 90 0. 05 9. 03 0 14 0 2. 65 0. 45 0. 09 0. 10 37. 10 8090. 00 4035. 00

US D Market C ap ($m)

US D L TM Total R ev ($m)

US D L TM Total E B ITDA ($m)

E B ITDA %

TE V/L TM R evenue

TE V/L TM E B ITDA

E mployees

15.4 113. 2 29.8 0. 4 2. 4 1. 2 4. 9 5. 9 2. 5 268. 1 1, 744. 6 0. 0 1, 231. 9 0. 7 5. 7 76.7 182. 6 42.6 0. 0 4. 6 41.1 20.4 36.7 7. 1 66.6 76.9 234. 1 97.4 65.8 1, 718. 7 262. 2 45.6 2, 423. 2 278. 7 75.0 2, 539. 5 7. 1 6. 6 16.2 0. 6 1, 120. 1 10.8 1. 3 20.5 5. 4 1, 102. 8 3, 113. 5 7. 3 192. 9 654. 5 334. 9 5, 094. 2 85.0 39.0 39.1 26.4 2, 297. 6 211. 3 2, 211. 2 55.0 17.8 208. 1 3, 321. 1 405. 3 288. 1 3. 8 0. 0 0. 0 27.0 2, 683. 0 50.6 6. 8 33,964.6 0. 2 223. 1 91.8 85.3 1. 1 757. 1 9. 5 1, 197. 5 4. 1 31.4 22.7 4. 7 1. 8 286. 5 101. 6 18.0

4. 4 108. 7 66.1 0. 1 0. 1 9. 4 11.7 0. 0 0. 0 361. 6 241. 2 6. 7 61.6 2. 5 6. 8 89.8 241. 9 77.1 NA 1. 0 0. 0 0. 6 15.4 NM 5. 3 9. 6 140. 6 81.9 5. 4 198. 5 183. 6 49.1 156. 0 119. 5 60.7 1, 392. 3 0. 0 1. 6 16.7 67.9 139. 1 1. 2 10.6 56.8 0. 1 136. 8 1, 971. 4 0. 7 63.0 207. 3 89.3 472. 4 21.5 1. 7 93.0 82.9 785. 7 191. 7 255. 6 21.0 0. 2 157. 4 629. 0 218. 6 192. 7 3. 5 2. 0 0. 1 0. 0 485. 1 50.5 0. 1 1, 391. 6 112. 0 250. 6 67.0 216. 6 17.1 949. 8 0. 8 563. 6 0. 0 23.2 5. 3 0. 1 NA 58.9 57.4 11.9

(3.7) 25. 9 (2.0) (2.3) (1.5) (12. 6) (12. 8) (2.7) (4.6) 25. 1 147.2 (6.6) 34. 7 (1.2) NM 9.7 31. 8 11. 1 NM (1.4) (1.8) (3.4) (3.6) NM (5.1) (4.5) 25. 1 20. 1 (17. 4) 124.1 NM 16. 6 93. 7 26. 6 1.4 52. 7 (0.6) (5.0) 7.2 4.0 61. 4 (1.9) (0.1) (4.4) (2.5) 46. 2 302.9 (2.4) 3.4 55. 7 25. 7 297.4 (13. 0) (13. 3) 6.9 (41. 5) 205.1 4.9 142.2 2.3 (10. 6) 20. 6 296.7 27. 3 12. 5 0.9 (0.7) (0.1) (5.6) 209.6 10. 8 (2.5) 680.3 (13. 5) 85. 5 1.9 (0.7) (0.2) 203.2 (0.4) 99. 0 (1.0) 2.3 (4.5) (0.7) NM 17. 0 12. 4 1.3

-83. 3% 23. 8% -2. 9% NM NM NM NM NM NM 6. 9% 61. 0% -98. 9% 56. 3% -45. 8% NM 10. 8% 13. 1% 14. 4% NM NM NM NM -23. 6% NM -95. 2% -47. 0% 17. 9% 24. 5% NM 62. 5% NM 33. 9% 60. 1% 22. 2% 2. 3% 3. 8% NM NM 42. 8% 5. 8% 44. 2% NM -1. 2% -7. 8% NM 33. 8% 15. 4% NM 5. 4% 26. 8% 28. 7% 63. 0% -60. 3% NM 7. 4% -50. 0% 26. 1% 2. 6% 55. 6% 11. 0% NM 13. 1% 47. 2% 12. 5% 6. 5% 27. 0% -34. 8% -60. 6% NM 43. 2% 21. 3% NM 48. 9% -12. 0% 34. 1% 2. 9% -0. 3% -1. 0% 21. 4% -54. 2% 17. 6% NM 9. 9% -84. 9% NM NM 28. 8% 21. 6% 10. 5%

4. 6x 0. 7x 0. 1x 12.6x 0. 9x 0. 7x 6. 1x 0. 0x 18.8x 0. 3x 2. 4x 0. 6x 1. 0x 0. 7x 6. 7x 36.7x 2. 5x 11.2x 7. 8x 1. 5x 0. 3x 12.1x 1. 0x 14.8x 2. 0x 1. 0x 0. 6x 3. 6x 0. 6x 8. 1x 8. 2x 0. 0x 7. 2x 1. 9x 9. 1x 3. 0x 3. 1x 2. 1x 3. 5x 25.3x 0. 3x 3. 0x 0. 5x 0. 7x 2. 5x 0. 0x 1. 6x 1. 5x 0. 6x 1. 1x 4. 5x 4. 5x 1. 0x 26.9x 0. 2x 0. 4x 0. 4x 0. 2x 1. 1x 12.6x 1. 9x 4. 5x 4. 0x 1. 9x -

3.1x 10. 5x 10. 0x 33. 4x 5.8x 7.3x 5.2x 8.4x 1.1x 24. 6x 9.2x 43. 5x 15. 2x 1.4x 18. 3x 21. 3x 12. 2x 11. 6x 7.3x 11. 3x 20. 9x 1.3x 23. 0x 0.3x 12. 5x 23. 0x 2.3x 10. 4x 4.5x 14. 0x 5.0x 10. 7x 13. 8x 8.9x -

11 NA NA 3 4 51 101 NA 46 2, 227 628 37 NA 22 16 NA NA NA NA 7 3 NA NA 2 NA NA NA NA 115 1, 570 751 469 NA NA NA 3, 200 NA NA 79 NA 2, 463 NA NA 90 14 NA 2, 969 NA 405 NA 3, 109 3, 109 237 NA NA NA 3, 411 590 2, 096 NA 74 NA 3, 124 514 NA 11 33 NA NA 3, 197 183 7 6, 421 347 1, 626 310 700 NA 1, 469 NA 1, 189 4 328 110 1 NA 246 NA NA

33,964.6 0. 0 811.1 42.6

1,971.4 0.0 161.2 57. 1

680.3 -41.5 39.0 1. 7

63. 0% -98. 9% 6.1% 12. 5%

36.7x 4.6x 1. 9x

43. 5x 11.8x 10. 4x

6, 421 1 936 246

Page 3

C A P I T A L M A R K E T S A C T I V I T Y (M & A A N D F I N A N C I N G ) October keeping pace: Total transaction value in the W eb 2.0 universe for October is $125.2 (vs. $89.5 million at time of last publication). The week ending October 19 has brought 11 financings to the sector bringing the total for October to 20 transactions averaging $7.8 million each (vs. an average of $9.0 million last week). The largest transaction in the week was the $16 million financing of HubSpot, a W eb marketing optimization solutions developer. The biggest deal in the month is Yext at $25 million. In comparison, total capital raised in September was $232.8 million, averaging $9.0 million (26 deals); August was $208.5 million, averaging $7.7 million (27 deals); and July (35 deals) $191.4 million, averaging $5.5 million.

Financing Activity Last Twelve Months 400.0

16.0 14.6

350.0

14.0

300.0

12.0

9.7

250.0

10.0

7.8

7.6

200.0 7.0

8.0

7.1

7.0

6.6

6.5

6.2

150.0

6.0

5.5 4.9

100.0

4.0

50.0

2.0

0.0

0.0 Oct-08

Nov-08

*May-09 includes $200m FB investment

Figure 2. Financings, Last Twelve Months Source. Company reports

Dec-08

Jan-09

Feb-09

Mar-09

Apr-09 Series1

May-09 Series2

Jun-09

Jul-09

Aug-09

Sep-09

Oct-09

(US$m)

(US$m)

9.0

Page 4

Deal round-up for October (to date): The large deal highlights for the month include: •

Yext – an online directory provider – raised $25 million.

•

PopCap Games – a developer of casual games played on multiple types of devices – raised $22.5 million in its first round of funding.

•

DailyMotion – a French online video content provider – raised $22.1 million through a Series C financing.

•

Engine Yard – provider of managed hosting and deployment solutions for Ruby and Rails applications – raised $19 million in a Series C financing.

•

HubSpot – provider of online enterprise marketing application – received $16 million in Series C financing.

All other deals in the month were in the amount of $10 million or less. For additional details on financings, see Figures 23 and 24 (at end of note).

Financing & M/A Summary - Last Three Months 200.0

180.0

160.0

140.0

(US$m)

120.0 Oct-09 100.0

Sep-09 Aug-09

80.0

60.0

40.0

20.0

Skype Mint Twitter Turbine Friends Reunited Smith & Tinker Yext NowPublic PopCap Games DailyMotion Ensequence iLike Engine Yard HubSpot Livebookings Dopplr Zoove RichRelevance Spigit Ooyala MediaMath FeedRoom Traffiq Mzinga InXpo Bill.com Edo Interactive Jobvite NextBio Riot Games InnoCentive OneRiot Balihoo Reality Mobile Boxee Imeem Vuclip HiveLive Polyvore YuMe Fanbase Booyah MOG Sometrics Scout Labs NeoEdge Amie Street Alliance Health Unisfair KODA Mocapay ViVu Conduit Labs OurStage Z2Live Scoreloop Fwix Vantrix Fizzback MashLogic Roblox Technorati Greystripe iSocket Tremor Media RightsFlow Loomia Plista FourSquare EduFire Tiny Pictures ChessCube DataSync DailyBooth Linkedex Fluther TransGaming Inc. Linksify Listia iSyndica VEVO Gigpark OnLive Gamelab.com

0.0

Figure 3. Capital Market Activity, Last Three Months Source. Company reports

Page 5

Social Networks the most active sector: Social Networks experienced the most financing activity among our W eb 2.0 sector categories in the past three months by number of transactions (11). Gaming follows with eight transactions. Advertising is the next most active (7), followed by Video (6) (Figure 4). The $2.0 billion acquisition of Skype skews the dollars transacted to the SMS/Voice segment, while the $170 million acquisition of Mint brings the Vertical Communities segment to the second highest total. Capital Market Activity by Sector - Last Three Months 200.0 180.0 160.0 140.0

(US$m)

120.0 100.0 80.0 60.0 40.0

46.0

39.4

37.9

35.5

34.0

26.1

17.1

17.1

15.8

14.0

13.2

9.0

6.0

3.9

2.8

2.0

1.3

0.4

Video

Infrastructure

Advertising

Crowdsourced Content

Music

Search

Enterprise

Collaboration

Virtual World

Mobile

Comment/Reputation

Advertising/Mobile

Analytics

Media

Social Commerce

Aggregation

Mobile Ad

Online Learning

Classified

116.5

100.0

Gaming

67.1

Social Networks

192.3 Vertical Communities

96.4

Microblog

2,025.0 SMS/Voice

20.0

3

8

1

11

6

4

7

4

5

3

4

3

3

5

2

1

3

1

1

1

1

1

1

0.0

# companies 1

Figure 4. Capital Market Activity, by Sector, Last Three Months Source. Company reports

Page 6

C A P I T A L M A R K E T S A C T I V I T Y (P R I C E P E R F O R M A N C E ) Web 2.0 index continues to outpace NASDAQ recovery: Our W eb 2.0 index (market-cap weighted) essentially mirrored the performance of the NASDAQ composite index from mid-2008 until earlier this year. However, the index has recently had a much stronger recovery relative to the NASDAQ index (Figure 5).

Web 2.0 Index Price Performance 250

200

150

100

50

Index: Web 2.0 (Market Cap) Figure 5. Web 2.0 Price Performance Source. Capital IQ

^COMP - Share Pricing

10/19/2009

10/5/2009

9/21/2009

9/7/2009

8/24/2009

8/10/2009

7/27/2009

7/13/2009

6/29/2009

6/15/2009

6/1/2009

5/18/2009

5/4/2009

4/20/2009

4/6/2009

3/23/2009

3/9/2009

2/23/2009

2/9/2009

1/26/2009

1/12/2009

12/29/2008

12/15/2008

12/1/2008

11/17/2008

11/3/2008

10/20/2008

0

Page 7

Broad-based price improvement: Twenty-seven companies in our universe had positive stock price performances over the past week (for stocks with prices greater than $1) (Figure 6), while 17 companies showed negative 1-week returns. Gaming companies saw broad-based increase: The biggest gainer of the week was The9 Limited (NasdaqGS:NCTY), an online game developer – up 17%. Tencent Holdings Ltd. (SEHK:700) – a Chinese online gaming company – closed up 14%. Frogster Interactive Pictures (XTRA:FRG) – maker of interactive online games – closed up 14%.

The9 Limited Tencent Holdings Ltd. Frogs ter Interactive Pictures Giant Interactive G roup, Inc. S ohu.com Inc. United Online Inc. Perfect World Co., Ltd. K ings of t Co. Ltd. DA DA S pA Chines e Gamer International Open Tex t Corp. Modern Times G roup Mtg A B S handa Intera ctive S park Netw orks , Inc. Y nk K orea Inc. Changy ou.com Limited Ngi G roup Inc. Netea s e.com Inc. G amania Digital Cy berplex Inc. V alueClick Inc. G ameOn Co Ltd. XING A G IA C/InterA ctiveCorp. TheS treet.com, Inc. My riad Group A G LookS mart, Ltd. Quepas a Corp. CDC Corp. G ree, Inc. NetDragon WebS oft, Inc. G igaMedia Ltd. Mix i, Inc. A Q Interactive, Inc. Y D Online Corp. Openw ave S y s tems Inc. Tree.Com, Inc. S K Communications Co., Ltd. Webz en Inc. A ctoz S of t Co., Ltd. HanbitS oft, Inc. PNI Digital Media Inc. S hutterf ly , Inc. NEOWIZ Games Corporation Eolith Co. Ltd. Gravity Co., Ltd -0.25 Figure 6. 1-Week Price Performance Source. Capital IQ

1 Week P rice P erformance

17.4% 14.4% 13.9% 11.1% 10.3% 8.9% 7.0% 7.0% 6.2% 6.0% 5.7% 5.3% 4.0% 3.8% 3.7% 2.8% 2.7% 2.6% 2.6% 2.4% 2.0% 1.8% 1.2% 0.8% 0.7% 0.4% 0.0% 0.0% 0.0%

-4.3% -5.2% -5.7% -5.9% -6.6%

-10.4% -19.6% -0.2

-1.2% -1.6% -1.6% -1.7% -1.8% -1.8% -1.9% -2.2% -2.4%

-16.0% -0.15

-0.1

-0.05

0

0.05

0.1

0.15

0.2

Page 8

P U B L I C C O M P A N Y I N D U S T R Y N E W S (P A R T N E R S H I P S , F I N A N C I A L R E S U L T S , N E W P R O D U C T S ) K ey Developments C ompany

Headline

Notes

F idelity Inves tments C anada L imited; F luid Mus ic C anada, Inc . (TS X: F MN); Hows on Tatters all Inves tment C ouns el L imited; S omers et E ntertainment Inc ome F und (TS X:S OM.UN)

F luid Mus ic C anada, Inc. (T S X: F MN) s igned a s upport agreement to acquire S omers et E ntertainment Income F und (T S X : S O M. UN) from a group of s hareholders for C AD 26. 1 million.

F luid Mus ic C anada, Inc. (T S X: F MN) s igned a s upport agreement to acquire S omers et E ntertainment Income F und (T S X: S OM.UN) from a group of s hareholders for C AD 26. 1 million in cas h and s tock on O ctober 12, 2009. T he groups of s hareholders are Andy B urges s , G ordon G ibs on, J anis F inkels tein, Allan S ilber, S heldon F inkels tein, J ay S mith, J as on Hendeles , F idelity Inves tments C anada L imited and Hows on T atters all Inves tment C ouns el L imited. F luid Mus ic will acquire all of the outs tanding S omers et trus t units at the election of the tendering holder (a) $2. 12 in cas h per unit; (b) 1. 1 common s hares of F luid. F luid will intend to immediately proceed with a compuls ory acquis ition or s ubs equent acquis ition trans action to acquire the remaining units .

C hines e Gamer International (G TS M:3083)

C hines e G amer International E nhance C ros s -S trait E xpans ion

C hines e G amer International plans to s pread its new game Hero O nline in the C hines e Mainland. C hines egamer is now talking with s ome mainland companies about the authorization of operating right and expected to achieve royalty from overs eas , namely, higher than US D 5 million.

W oozyF ly, Inc .

W oozyF ly Inc. will C hange its T icker to W ZY F Q from W ZY F S AP AG and O pen T ext C orp. E xpand G lobal R es eller Agreement

E ffective O ctober 14, 2009, W oozyF ly Inc. will change its O T C B B s tock ticker s ymbol to W ZY F Q from W ZY F .

NeuL ion Inc orporated (TS X: NL N)

NeuL ion Incorporated and Hors eR acing T V Inc. Announce Debut of a New S ervice

Hors eR acing T V Inc. and NeuL ion announced the debut of a new s ervice dedicated to the s port and lifes tyle of hors e racing. W ith acces s to over 70 tracks from acros s the country and around the world, HR T V brings the thrill of live racing to viewers online through a uniquely branded video portal where fans can acces s all the bes t hors e racing action. P owered by NeuL ion technology, a leading s ervice provider of live and on demand s ports and international programming, HR T V 's broadband s ervice gives racing fans the ability to watch live race coverage, the HR T V channel and unparalleled acces s to racing's greates t circuits , on a 24 hours per day, s even days a week bas is . T he one-of-akind s ervice features live races , video-on-demand, audience polling and more. Additionally, s ubs cribers have acces s to various content and a full complement of the network's award-winning original programming including: 'Ins ide Information, ' 'P urs uit of the C up, ' 'Agains t the Odds , ' 'Acros s T he B oard' and more.

P erfec t World C o., L td. (Nas daqG S :P W R D) Neteas e.c om Inc . (Nas daqGS : NTE S )

P erfect W orld C o. L td. Inves ts $3. 44 Million to S et Up New C ompany in T aiwan Neteas e.com Inc. - C onference P res entation C all

P erfect W orld C o. L td. inves ted $3.44 million to s et up a new company in T aiwan.

is eemedia Inc . (TS XV: IE E )

is eemedia Inc. Delivers B lackberry-L ike S ervice to Mas s - is eemedia Inc. announced the availability of is eemail(T M), a new B lackberry-like s ervice that eliminates the need for Market Mobile P hones expens ive data plans or high-end phones to receive emails and rich attachments on the go. T he s olution will be s pecifically attractive to wireles s s ervice providers and O E Ms who s upport almos t two billion mobile phone s ubs cribers in emerging markets where the penetration of s martphones is virtually non-exis tent. T he C ompany als o announced that a s oon-to-be-dis clos ed carrier is now implementing the is eemedia s ervice in India. Informa predicts there will be 4. 81 billion mobile phone s ubs cribers by 2012, with the majority of the next billion s ubs cribers coming from emerging markets . P ortio R es earch further s tates that nine of the top ten highes t growth markets over this period have one key defining factor in common-they are all low income per-capita markets . T herefore hands ets s old into thes e emerging markets will continue to be mainly lower-priced devices .

S ites earc h C orporation

S ites earch C orporation Announces R es ignation of J orge de los S antos as Director O pen T ext C orp. Announces New R eleas e of O pen T ext E mail Management for Micros oft E xchange

O n O ctober 13, 2009, Mr. J orge de los S antos res igned as a member of the B oard of Directors of S ites earch C orporation. O pen T ext C orp. announced its lates t new releas e of O pen T ext E mail Management for Micros oft E xchange, a fullfeatured email management s olution that helps companies reduce s kyrocketing email s torage requirements and enhance their ability to res pond to eDis covery reques ts . B y offering unprecedented control and automation, companies can automate and s afeguard the dis pos ition of unimportant email and provide common-s ens e mechanis ms for us ers to identify and retain bus ines s -critical mes s ages . O pen T ext's email management capabilities are an integral part of the O pen T ext E C M S uite, which provides the broades t, mos t comprehens ive s et of integrated E C M capabilities on the market. T he new O pen T ext E mail Management 10 for Micros oft E xchange s ys tematically captures bus ines s value and intended record email mes s ages , and als o offers a reliable and cons is tent method for identifying and deleting unimportant or trans itory email.

Quepas a C orp. (OTC B B : QP S A)

Q uepas a Launches its P apacito Dating Application

Q uepas a C orp. announced the launch of its P apacito dating application. T he launch of the P apacito application is part of Q uepas a's overall monetization s trategy which will focus on dis tributed s ocial media and applications tied into Q uepas a's virtual economy, which will facilitate both virtual gifting and purchas es of V IP s ubs criptions within this new dating application and s cheduled future applications . As dating and flirting is among the top activities on Q uepas a, the company believes that this new application will enhance us er experience and thus drive s ignificant engagements . P apacito aims to capitalize on the bas ic human interactions prevalent in s ocial networks by facilitating this type of interaction with a fun and engaging s ocial game. T he application will allow us ers to anonymous ly admire other us ers by adding them as their 'P apacito. ' T o increas e game play and extend functionality, more gues s es per game will be available via both ala carte pricing and a monthly s ubs cription fee payable via QDollars , the Q uepas a premium virtual currency.

ZipL oc al Inc . (TS XV: ZIP .H)

ZipL ocal Inc. R eports Unaudited C ons olidated E arnings ZipL ocal Inc. reported unaudited cons olidated earnings res ults for the fourth quarter and full year ended J une 30, 2009. R es ults for the F ourth Q uarter and F ull Y ear E nded J une F or the quarter, the company has pos ted s ales of C AD 621, 223 compared to C AD 837, 782 for the s ame period a year 30, 2009 ago. Net los s and comprehens ive los s was C AD 77, 850 compared to C AD 1, 697, 886 or C AD 0. 02 bas ic and diluted per s hare for the s ame period a year ago. Net cas h us ed in operating activities was C AD 162, 605 compared to C AD 518, 758 for the s ame period a year ago.

Open Text C orp. (Nas daqG S :OTE X); S AP AG (DB : S AP )

Open Text C orp. (Nas daqG S :OTE X)

S AP AG and Open T ext C orp. announced another expans ion of their s ucces s ful s trategic relations hip. S AP has s elected O pen T ext E xtended E C M for S AP for res ale under the name the S AP ® E xtended E nterpris e C ontent Management (S AP E xtended E C M) application by O pen T ext.

Neteas e.com Inc. - C onference P res entation C alls

F or the full year, the company has pos ted s ales of C AD 2, 802, 805 compared to C AD 3, 969, 909 for the s ame period a year ago. Net los s and comprehens ive los s was C AD 1, 983, 123 or C AD 0. 02 bas ic and diluted per s hare compared to C AD 6,302, 258 or C AD 0. 09 bas ic and diluted per s hare for the s ame period a year ago. Net cas h us ed in operating activities was C AD 1, 535, 554 compared to C AD 4, 960, 397 for the s ame period a year ago. P urchas e of property, plant and equipment was C AD 15, 817 compared to C AD 138, 105 for the s ame period a year ago.

Figure 7. Key Developments Source. Capital IQ

Page 9

VALUATION Online Gaming companies lead market-cap charts: Fifteen companies in our W eb 2.0 universe top US$1 billion in market capitalization (Figure 8). Fifty-seven of the 89 companies have market caps under US$100 million, with 25 under US$10 million. Online gaming companies dominate the top of the list, led by Tencent Holdings (SEHK:700) with a market cap near US$30 billion.

Market C ap (US D m) 28, 711.6 5, 565. 3 3, 337. 9 2, 716. 1 2, 548. 7 2, 509. 0 2, 250. 1 2, 142. 8 2, 097. 2 1, 818. 9 1, 512. 6 1, 255. 2 1, 127. 8 970. 1 968. 2 676. 6 659. 8 399. 7 341. 0 308. 1 284. 5 277. 4 264. 9 261. 7 225. 2 208. 7 208. 1 192. 5 189. 7 159. 7 124. 6 105. 5 98. 6 93. 0 87. 5 83. 1 76. 7 74. 9 73. 3 68. 4 65. 8 59. 8 55. 0 52. 0 47. 1 45. 2 39. 4 36. 3 33. 4 32. 1 29. 6 29. 4 27. 0 23. 5 19. 9 19. 5 19. 5 19. 1 17. 0 16. 8 16. 8 12. 1 11. 3 10. 4 9. 7 8. 9 5. 9 5. 9 5. 7 5. 2 4. 9 4. 5 4. 2 4. 1 3. 8 3. 3 2. 5 2. 1 2. 0 1. 8 0. 9 0. 6 0. 6 0. 6 0. 3 0. 0 0. 0 0. 0 0. 0

Tencent Holdings L td. Neteas e. c om Inc. S handa Interac tive Entertainment L td. Modern Times G roup Mtg A B IA C/InterA ctiveCorp. S ohu. c om Inc. Perfec t World Co. , L td. Gree, Inc. Open Tex t Corp. Changy ou. com L imited G iant Interac tive Group, Inc. Chines e Gamer International V alueClick Inc. Mix i, Inc. K ings oft Co. L td. NEOWIZ Games Corporation United Online Inc. S hutterf ly , Inc. NetDragon WebS oft, Inc. S K Communications Co. , L td. XING A G G ungHo Online Entertainment, Inc. CDC Corp. GigaMedia L td. Gamania Digital Entertainment Co. , L td. Openw ave S y s tems Inc. OA O R B C Inf ormation S ys tems My riad Group A G The9 L imited DA DA S pA A c toz S of t Co. , L td. Y edangOnline Corp. NeuL ion Incorporated G ameOn Co L td. TheS treet.c om, Inc. Tree. Com, Inc. HanbitS oft, Inc. Cy berplex Inc. Fluid Mus ic Canada, Inc. Frogs ter Interac tive Pic tures A G GeoS entric Oy j PNI Digital Media Inc. DigitalTow n, Inc. Gravity Co., L td S park Netw orks , Inc. Eolith Co. L td. DXN Holdings B hd NeXplore Corporation Ngi G roup Inc. Webz en Inc. A Q Interactive, Inc. Northgate Tec hnologies L imited S ocialw is e, Inc. Wiz z ard S oftw are Corporation Dolphin Digital Media, Inc. B roadWebA s ia Inc. LookS mart, L td. Quepas a Corp. J umbuck Entertainment L imited A c celeriz e New Media, Inc. Y nk K orea Inc. L ingo Media Corporation B ey ond Commerc e, Inc. UOMO Media, Inc S pec trumDNA , Inc. Ex tens ions , Inc. B right Things plc is eemedia Inc. CornerWorld Corporation Worlds . c om Inc. MOK O. mobi L imited DigitalPos t Interac tive, Inc. IA S Energy , Inc. Magnitude Information S y s tems Inc. S NA P Interac tive, Inc. V OIS , Inc. L iveWorld Inc. B igs tring Corp. B etaw ave Corporation Wynds torm Corporation Unis erve Communications Corp. K A B Dis tribution Inc. A s s oc iated Media Holdings Inc. CL ICK ER Inc. The Parent Company China Gatew ay Corporation S NM Global Holdings Dibz International, Inc. S ocial Media V enures , Inc. 0 Figure 8. Market Cap Ranking Source. Capital IQ

500

1, 000

1, 500

2, 000

2, 500

3, 000

3,500

4, 000

Page 10

TEV/Revenue (LTM) averages 4.6x: The overall average TEV/Revenue (LTM) multiple for our group is 4.6x (vs. 4.6x last week) (Figure 9). Having recovered from a negative end of month in September, we now see three companies trading above 25x revenue – Dolphin Digital Media, Inc. (OTCBB:DPDM) at 36.7x, Tencent Holdings Ltd. (SEHK:700) at 26.9x, and NexPlore Corporation (OTCPK:NXPC) at 25.3x. The median of 1.9x is on par with last week’s multiple. Note that we exclude multiples greater than 50x. Twenty-nine companies have multiples under 1.5x.

T E V/L T M R evenue (x) 40. 0 36.7

35. 0 30. 0 26.9 25.3

25. 0 18.8

20. 0

14.8

15. 0 11.2

10. 0

7.2 6.1 6.7

A verage, 4.6 5. 0 0. 0

9.1

4.0 4.5 4.5 4.54.6

L iveWorld Inc . C hina G atewa y C orporation O AO R B C Information S y s tems AQ Intera ctive, Inc . T he P a rent C ompany U nis erve C ommunications C orp. G a meO n C o Ltd. C LIC K E R Inc. N orthgate T echnologies L imited T heS treet.com, Inc . T ree.C om, Inc. O penwave S y s tems Inc . IAC /InterAc tiveC orp. J umbuc k E nterta inment L imited S NAP Intera ctive, Inc . C y berplex Inc . P erfect World C o. , Ltd. C DC C orp. Ac toz S oft C o. , Ltd. DXN Holdings B hd B ey ond C ommerce, Inc . DADA S pA S pa rk N etwork s , Inc . H anbitS oft, Inc . G igaMedia Ltd. S N M G loba l Holdings United O nline Inc . Y nk K orea Inc . S K C ommunica tions C o., Ltd. G a mania Digital E ntertainment C o., S hutterfly , Inc . Modern T imes G roup Mtg AB V alueC lic k Inc . Y D O nline C orp. G ungHo O nline E ntertainment, Inc. NetDra gon WebS oft, Inc . C ornerWorld C orporation E olith C o. Ltd. P N I Digital Media Inc. O pen T ex t C orp. My riad G roup AG NE O WIZ G ames C orporation NeuLion Inc orporated is eemedia Inc . XIN G AG Wiz z ard S oftware C orporation S ohu.com Inc . S ocia l Media V entures Inc . Acceleriz e New Media , Inc . C hangy ou.com L imited DigitalP os t Intera ctive, Inc. Mix i, Inc . F rogs ter Intera ctiv e P ic tures AG K ings oft C o. Ltd. Lingo Media C orporation MO K O .mobi L imited F luid Mus ic C a nada , Inc. G eoS entric O y j UO MO Media, Inc As s ociated Media Holdings Inc . G ree, Inc . C hines e G amer Interna tional NeX plore C orporation T encent Holdings Ltd. Dolphin Digital Media, Inc.

3.0 3.0 3.1 3.5 3.6 1.9 1.9 1.9 2.0 2.1 2.4 2.5 2.5 1.0 1.0 1.0 1.1 1.1 1.4 1.5 1.5 1.6 0.9 1.0 0.7 0.7 0.7 0.7 0.5 0.6 0.6 0.6 0.6 0.4 0.4 0.0 0.0 0.0 0.10.2 0.2 0.3 0.3 0.3

7.8 8.1 8.2

12.112.612.6

Figure 9. TEV/Revenue Ranking Source. Capital IQ

TEV/Revenue (LTM) by country/exchange: W e have also calculated multiples based on where the companies are listed or domiciled. Figure 10 shows the average TEV/Revenue multiples by stock exchange. The OTCBB has the largest number of companies (18), trading at an average multiple of 8.1x (vs. 8.4x last week). On a geographic basis, the United States has the most companies (38), trading at an average of 5.0x revenue (vs. 5.2x last week) (Figure 11). Ten of the companies are Canadian (average 4.3x revenue). Average TEV/LTM Revenue - By Exchange

Average TEV/LTM Revenue - By Country

14.0 12.4 12.0 12.1

10.0 7.1

6.0

5.9

5.0 4.9 4.8 4.3 3.0

1

8

1

1

1

Grand Total

1

United

10

India

2

0.0 0.0 0.0 Russia

# Companies

Hong Kong

South

6

1 1 1 1

Italy

Sweden

38

Switzerland

2

Canada

3

Japan

United

10

Australia

Germany

1

China

0.0

Malaysia

1.9 1.8 1.0 0.7 0.7 0.3

2.0 Taiwan

AIM

NYSE

0.0 0.00.0 RTS

BSE

0.4 0.3

1 2 1 14 1 6 1 1 5

Figures 10 & 11. TEV/Revenue Ranking (Exchange, Country) Source. Capital IQ

8.1

8.0

4.0

NasdaqGM

CM

TSXV

TSX ASX

1 2 18 11 2 5 4 2 4

XTRA

3

2.0 1.9 1.8 1.0 0.7 KLSE

TSE

OTCPK

HLSE

OTCBB

SEHK # Companies

GTSM

2.0

3.0 2.7 2.0

OM KOSE

5.6 5.1 4.8 3.6

OSE

4.0

NasdaqGS

6.2 5.9

SWX

6.0

(x)

8.1

Finland

8.0

0.0

12.1

12.0

10.2

AMEX

(x)

10.0

14.0

1

1

1

88

Page 11

TEV/EBITDA (LTM) averages 12.1x: The average multiple for the 35 companies with positive EBITDA (and multiples under 100x) is 12.1x LTM EBITDA (vs. 12.2x last week), led by HanbitSoft, Inc. (KOSE:A047080) 43.5x multiple (Figure 12). Twelve companies have EBITDA multiples under 7x. The median multiple is 10.5x (vs. 10.0x last week). T E V/L T M E B IT DA (x) 50. 0 43. 5

45. 0 40. 0 33. 4

35. 0 30. 0 25. 0

20. 9 21. 3

H anbitS oft, Inc.

C hines e G amer International

G ree, Inc .

S K C ommunic ations C o. , Ltd.

Mix i, Inc .

O penwave S y s tems Inc.

K ings oft C o. L td.

IAC /InterAc tiveC orp.

P NI Digital Media Inc .

15. 2

T heS treet. c om, Inc .

XING AG

13. 7 13. 8 14. 0

Y nk K orea Inc.

S hutterfly , Inc.

Modern T imes G roup Mtg AB

NE O WIZ G ames C orporation

O pen T ex t C orp.

C DC C orp.

S ohu. c om Inc .

C hangy ou. c om L imited

V alueC lic k Inc .

11. 6 12. 2 12. 5 10. 4 10. 5 10. 7 11. 3 9. 2 10. 0

G ungH o O nline E ntertainment, Inc .

8. 9

Y D O nline C orp.

7. 3

8. 4

G amania Digital E ntertainment C o. , Ltd.

7. 3

DADA S pA

C yberplex Inc.

DXN Holdings B hd

Actoz S oft C o. , L td.

5. 2 5. 8

U nited O nline Inc .

3. 1

5. 0

S park Network s , Inc .

2. 3 S NAP Interac tive, Inc .

G ameO n C o L td.

1. 3 1. 4 J umbuck E ntertainment L imited

1. 1

P erfec t World C o. , L td.

0. 3 O AO R B C Information S y s tems

5. 0

4. 5

NetDragon WebS oft, Inc.

A verage, 12.1

10. 0

0. 0

24. 6

18. 3

20. 0 15. 0

23. 0 23. 0

Figure 12. TEV/EBITDA Ranking Source. Capital IQ

TEV/EBITDA (LTM) by country/exchange: Figure 13 shows the average TEV/EBITDA multiples by stock exchange. The OTCBB has the largest number of companies (18), trading at an average multiple of 2.3x. On a geographic basis, the United States has the most companies (38), trading at an average of 10.6x EBITDA (Figure 14). Ten of the companies are Canadian (average 13.4x EBITDA). Average TEV/LTM EBITDA - By Country

Average TEV/LTM EBITDA - By Exchange 25.0 23.0

25.0

20.0

20.0

20.9

(x)

Figures 13 & 14. TEV/EBITDA Ranking (Exchange, Country) Source. Capital IQ

2

18

2

1

# Companies

Switzerland

1

Russia

4

Australia

1

Malaysia

CM

1

Italy

OSE

14

China

NasdaqGS

1

Hong Kong

OM

3

0.0

United States

SEHK

2

0.3

Sweden

XTRA

5

1.4

0.0 Canada

NasdaqGM

5

5.2

Germany

TSE

6

7.3

5.0

Japan

KOSE

2

1.4 0.3

South Korea

GTSM

4

2.3

10.6 10.5 9.5

Taiwan

TSXV # Companies

5.8 5.2 4.5

RTS

7.3

ASX

9.2

5.0 0.0

14.0 13.8 13.4 12.2

10.0

AMEX

10.8

OTCBB

14.013.8 12.8 12.2

TSX

(x) 10.0

18.0 15.0

KLSE

20.9 18.0 15.7

15.0

3

8

6

2

10

1

38

1

10

1

1

2

1

1

Page 12

P/E (LTM) averages 18.8x: The average multiple for the 33 companies with positive earnings (and multiples under 100x) is 18.8x LTM EPS (vs. 18.8x last week), led by Tencent Holdings Ltd. (SEHK:700) with a 69.3x multiple (Figure 15). Twelve companies have P/E multiples under 10x. The median is 13.3x.

P /E L T M (x) 80.0 69.3 70.0 60.2 60.0 51.4 50.0

53.6

43.7 38.3

40.0

34.0 29.4

30.0

T encent H oldings Ltd.

G ungH o O nline E ntertainment, Inc.

Mix i, Inc.

G ree, Inc.

C hines e G amer International

O pen T ex t C orp.

NE O W IZ G ames C orporation

XING AG

22.3

K ings oft C o. Ltd.

20.1

G amania Digital E ntertainment C o., Ltd.

18.0

Worlds .com Inc.

Actoz S oft C o., Ltd.

S ohu.com Inc.

Modern T imes G roup Mtg AB

S park Network s , Inc.

NetDragon W ebS oft, Inc.

H anbitS oft, Inc.

9.7

IAC /InterActiveC orp.

7.1

C hangy ou.com Limited

J umbuck E ntertainment Limited

6.9

Y D O nline C orp.

P erfect World C o., Ltd.

0.0

6.7

G igaMedia Ltd.

Neteas e.com Inc.

4.6

15.9 16.0 13.3 13.6 13.9 14.9 10.4 10.8 12.0 12.0

G ameO n C o Ltd.

3.2

DXN H oldings B hd

2.9

C y berplex Inc.

2.5 T he9 Limited

10.0

S NAP Interactive, Inc.

A verage, 18.8

20.0

Figure 15. P/E Ranking Source. Capital IQ

P/E (LTM) by country/exchange: Figure 16 shows the average P/E multiples by stock exchange. The OTCBB has the largest number of companies (18), trading at an average multiple of 12.3x. On a geographic basis, the United States has the most companies (38), trading at an average of 12.6x earnings (Figure 17). Ten of the companies are Canadian (average 22.6x EPS).

KOSE

OM

AMEX

OTCBB

NasdaqGS

KLSE

TSX

ASX

NYSE

NasdaqGM

3

2

2

6

1

2

18

14

1

4

2

1

5

Figures 16 & 17. P/E Ranking (Exchange, Country) Source. Capital IQ

# Companies

0.0 0.0 Italy

XTRA

5

4.6

Switzerland

GTSM

1

7.1

Australia

SEHK

0.0

12.6 12.4

Malaysia

2.0

TSE

# Companies

4.6

OSE

0.0

6.9

South Korea

10.0

13.9 12.3 11.0 7.1

14.9 14.6

United States

14.9

China

18.6

20.0

24.7 22.6

Sweden

30.0

29.4

29.4

Canada

38.2 35.1 31.9

40.0

(x)

(x)

50.0

Taiwan

60.2

60.0

Average P/E - By Country 43.7

Germany

70.0

50.0 45.0 40.0 35.0 30.0 25.0 20.0 15.0 10.0 5.0 0.0

Japan

Average P/E - By Exchange

6

2

3

10

1

10

38

8

1

2

1

1

Page 13

UPCOMING EVENTS E arnings C alendar C ompany

Date & Time

Quarter

C onf C all Details

Modern Times Group Mtg AB (OM:MTG B)

Wednesday, October 21, 2009, 9:00 a.m. EDT

Q 3 2009

http: //www. mtg. s e/en/Inves tors /C onference-ca lls /R egis tra tion/

Changyou.com Limited (NasdaqGS:CYOU)

Monday, October 26, 2009, 7:00 a.m. EDT

Q 3 2009

1-866-314-5050

Sohu.com Inc. (NasdaqGS:SOHU)

Monday, October 26, 2009, 8:00 a.m. EDT

Q 3 2009

1-800-901-5248

IAC/InterActiveCorp. (NasdaqGS:IACI)

Tuesday, October 27, 2009, 11:00 a.m. EDT

Q 3 2009

www. iac. com/inves tors

ValueClick Inc. (NasdaqGS:VCLK)

Tuesday, October 27, 2009, 4:30 p.m. EDT

Q 3 2009

http: //www. va lueclick. com/

Open Text Corp. (NasdaqGS:OTEX)

Tuesday, October 27, 2009, 5:00 p.m. EDT

Q 1 2010

1-800-814-4861 719-325-4880

Shutterfly, Inc. (NasdaqGS:SFLY)

Wednesday, October 28, 2009, 5:00 p.m. EDT

Q 3 2009

Openwave Systems Inc. (NasdaqGS:OPWV)

Thursday, October 29, 2009, 5:00 p.m. EDT

Q 1 2010

877-941-8416

Tree.Com, Inc. (NasdaqGM:TREE)

Friday, October 30, 2009, 11:00 a.m. EDT

Q 3 2009

1-888-428-9470

United Online Inc. (NasdaqGS:UNTD)

Wednesday, November 4, 2009, 5:30 p.m. EDT

Q 3 2009

877-718-5098

Figure 18. Earnings Calendar Source. Company reports

Page 14

C omparable C ompany Analys is > Web 2.0 Pric e P erformanc e C ompany Name

C urrenc y

Tic ker

E xc hange

US D Market C ap ($m)

A ccelerize New Media, Inc. A ctoz S oft C o. , L td. A Q Interactive, Inc. A s s ociated Media H oldings Inc. B igs tring C orp. B eta wave C orpora tion B eyond C ommerce, Inc. B right T hings plc B roadW ebA s ia Inc. C DC C orp. C ha ngyou.com Limited C hina G a tewa y C orporation C hines e G a mer International C LIC K E R Inc. C ornerW orld C orpora tion C yberplex Inc. DADA S pA DXN Holdings B hd Dibz Interna tional, Inc. DigitalP os t Intera ctive, Inc. DigitalT own, Inc. Dolphin Digital Media, Inc. E olith C o. L td. E xtens ions , Inc. F luid Mus ic C anada, Inc. F rogs ter Intera ctive P ictures AG G amania Digita l E ntertainment C o., L td. G ameO n C o L td. G eoS entric Oyj G ia nt Interactive G roup, Inc. G igaMedia L td. G ra vity C o., Ltd G ree, Inc. G ungH o Online E ntertainment, Inc. H anbitS oft, Inc. IAC /InterA ctiveC orp. IAS E nergy, Inc. is eemedia Inc. J umbuck E ntertainment Limited K AB Dis tribution Inc. K ings oft C o. L td. L ingo Media C orpora tion L iveW orld Inc. L ookS mart, L td. Ma gnitude Information S ys tems Inc. Mixi, Inc. Modern T imes G roup Mtg AB MO K O .mobi L imited Myriad G roup AG NE O W IZ G ames C orporation NetDra gon W ebS oft, Inc. Netea s e. com Inc. NeuLion Incorpora ted NeXplore C orpora tion Ngi G roup Inc. Northgate T echnologies Limited O pen T ext C orp. O penwa ve S ys tems Inc. P erfect W orld C o., Ltd. P NI Digital Media Inc. Q uepa s a C orp. O AO R B C Information S ys tems S ha nda Interactive E nterta inment L td. S hutterfly, Inc. S K C ommunications C o. , L td. S NA P Intera ctive, Inc. S NM G loba l H oldings S ocial Media V entures Inc. S ocialwis e, Inc. S ohu.com Inc. S pa rk Networks , Inc. S pectrumDNA, Inc. T encent H oldings Ltd. T he P a rent C ompany T he9 L imited T heS treet.com, Inc. T ree.C om, Inc. U nis erve C ommunica tions C orp. U nited O nline Inc. U OMO Media, Inc V alueC lick Inc. V OIS , Inc. W ebzen Inc. W izzard S oftwa re C orporation W orlds .com Inc. W ynds torm C orpora tion XING A G Y D Online C orp. Y nk K orea Inc.

US D KR W JPY US D US D US D US D GB P US D US D US D US D TWD US D US D C AD E UR MY R US D US D US D US D KR W US D C AD E UR TWD JPY E UR US D US D US D JPY JPY KR W US D US D C AD AU D C AD HK D C AD US D US D US D JPY SEK AU D C HF KR W HK D US D C AD US D JPY INR US D US D US D C AD US D US D US D US D KR W US D US D US D US D US D US D US D HK D US D US D US D US D C AD US D US D US D US D US D US D US D US D E UR KR W KR W

AC L Z A052790 3838 AS MH BSGC B W AV B Y OC AIM:B G T BWBA C H IN.A C Y OU CGWY G T S M:3083 CLK Z CW R L T S X: C X C M:DA DXN DIB Z DG LP DG T W DP DM A041060 E XT I T S X: F MN FR G 6180 3812 G E O1V GA G IG M GR VY T S E :3632 3765 A047080 IA C I IA S A. E IE E AS X: J MB T S X: K AB 3888 T S XV :LM LV W D LO OK MAG Y 2121 MT G B MK B MY R N A095660 777 NT E S T S X: NL N NXP C 2497 590057 OT E X OP W V PWRD T S XV :P N QP S A R BCI S NDA S F LY A066270 S TVI S NMN S MV I S CLW S O HU LO V S P XA 700 K IDS . Q NC T Y TS CM TR E E T S XV :US S UNT D UO MO V CLK V O IS W ZE N W ZE W DDD W Y ND O1B C A052770 A023770

OT C B B K OS E TS E OT C P K OT C B B OT C B B OT C B B A IM OT C P K Nas da qG S Nas da qG S OT C P K GTS M OT C B B OT C B B TS X CM K LS E OT C P K OT C B B OT C B B OT C B B K OS E OT C P K TS X XT R A GTS M TS E H LS E NY S E Nas da qG S Nas da qG M TS E OS E K OS E Nas da qG S OT C B B T S XV AS X TS X S E HK T S XV OT C P K Nas da qG M OT C B B TS E OM AS X S WX K OS E S E HK Nas da qG S TS X OT C P K TS E BSE Nas da qG S Nas da qG S Nas da qG S T S XV OT C B B R TS Nas da qG S Nas da qG S K OS E OT C B B OT C P K OT C P K OT C B B Nas da qG S A ME X OT C B B S E HK OT C P K Nas da qG S Nas da qG M Nas da qG M T S XV Nas da qG S OT C B B Nas da qG S OT C B B Nas da qG M A ME X OT C B B OT C P K XT R A K OS E K OS E

15.4 113.2 29.8 0.4 2.4 1.2 4.9 5.9 2.5 268.1 1, 744.6 0.0 1, 231.9 0.7 5.7 76.7 182.6 42.6 0.0 4.6 41.1 20.4 36.7 7.1 66.6 76.9 234.1 97.4 65.8 1, 718.7 262.2 45.6 2, 423.2 278.7 75.0 2, 539.5 7.1 6.6 16.2 0.6 1, 120.1 10.8 1.3 20.5 5.4 1, 102.8 3, 113.5 7.3 192.9 654.5 334.9 5, 094.2 85.0 39.0 39.1 26.4 2, 297.6 211.3 2, 211.2 55.0 17.8 208.1 3, 321.1 405.3 288.1 3.8 0.0 0.0 27.0 2, 683.0 50.6 6.8 33,964. 6 0.2 223.1 91.8 85.3 1.1 757.1 9.5 1, 197.5 4.1 31.4 22.7 4.7 1.8 286.5 101.6 18.0

H igh L ow Average Media n

Figure 19. Price Performance Source. Capital IQ

811.1

C urrent P ric e 0.55 15, 600 49, 000 0.01 0.04 0.04 0.11 0.01 0.03 2.53 31.72 0.00 475.00 0.01 0.06 1.28 7.69 0.65 0.00 0.06 1.50 0.38 605.00 0.16 1.38 20.50 50.00 90, 100 0.05 7.59 4.81 1.64 4, 840 217, 500 4, 085 19.18 0.10 0.14 0.38 0.01 7.95 0.94 0.04 1.20 0.01 640,000.00 329.00 0.08 4.50 37,050.00 4.91 39.36 0.81 0.70 28,200.00 36.30 40.92 2.53 44.96 1.75 1.40 1.50 49.38 15.92 8,210.00 0.35 0.00 0.04 0.61 69.99 2.46 0.14 145 0.01 8.89 3.00 7.90 0.05 9.03 0.11 13.74 0.01 2.65 0.45 0.09 0.10 37.10 8,090.00 4,035.00

1 Wk

1 Mth

3 Mth

6 Mth

1 Yr

52 Week

-8.3% -5.2% -1.8% -35.7% 0. 0% -40.0% -30.5% 0. 0% -87.0% 0. 0% 2. 8% -86.7% 6. 0% 18.4% 0. 0% 2. 4% 6. 2% 6. 6% 20.0% 0. 0% -25.4% 0. 0% -16.0% -64.4% 2. 2% 13.9% 2. 6% 1. 8% 0. 0% 11.1% -1.6% -19.6% -1.2% -5.3% -5.7% 0. 8% 68.3% 16.7% 0. 0% -50.0% 7. 0% 4. 4% -48.8% 0. 0% 71.4% -1.7% 5. 3% 5. 3% 0. 4% -10.4% -1.6% 2. 6% -15.6% 16.7% 2. 7% -3.5% 5. 7% -1.9% 7. 0% -5.9% 0. 0% 0. 0% 4. 0% -6.6% -2.4% -30.0% -5.3% -53.3% 3. 4% 10.3% 3. 8% -30.0% 14.4% 0. 0% 17.4% 0. 7% -2.2% 25.0% 8. 9% -8.3% 2. 0% -7.4% -4.3% -6.2% -10.0% 0. 0% 1. 2% -1.8% 3. 7%

-15.4% -21.0% -6.7% -35.7% 107.3% -40.0% -38.2% 10.0% -87.0% -9.6% -18.1% -86.7% 4.4% 80.0% 0.0% 0.8% 7.0% 7.4% NM 9.1% 0.0% 2.7% -30.9% -11.1% -1.4% 17.2% -1.2% -10.6% 0.0% -2.2% -10.6% -16.7% -1.7% -12.1% -1.6% -7.4% -56.1% 133.3% -2.6% -99.2% -4.4% -6.0% 2.5% -8.4% 20.0% 6.8% 3.5% 12.9% 5.1% -10.4% -17.5% -13.0% -19.0% 16.7% 5.4% -16.8% 5.7% -10.3% 1.7% -7.9% -20.0% 42.9% -8.9% -8.3% -12.5% -12.5% -52.6% -65.0% 5.2% 1.0% 12.8% -36.4% 14.7% -30.0% 3.0% 12.4% -0.8% 25.0% 8.7% -15.4% 9.7% 25.0% -6.4% -6.2% -10.0% 0.0% 12.4% -11.2% -3.9%

-3.5% -43.5% -16.1% -55.0% 0.0% -63.5% -65.0% -8.3% -87.0% 14.0% -28.0% -86.7% -0.2% -10.0% 20.0% -15.2% 28.4% 73.3% 20.0% 1.7% -25.0% 26.7% -25.3% 100.0% 53.3% 65.3% -21.9% -13.4% 25.0% -5.7% -2.4% 0.0% 39.5% 3.6% -12.2% 9.4% -8.2% 64.7% 0.0% -99.2% 15.4% -21.7% 17.1% 7.1% 60.0% -6.2% 36.2% 31.7% 1.1% 16.3% -19.9% -5.4% 1.3% 55.6% -17.1% 5.8% 10.5% -11.5% 34.2% 9.4% 55.6% 100.0% -14.5% 9.0% -14.0% -22.2% 12.5% -89.1% -23.8% 9.3% 0.4% -6.7% 44.2% -75.0% -1.9% 48.5% -18.3% -50.0% 10.7% 0.0% 19.9% 0.0% -23.2% -4.3% -35.7% 0.0% 30.2% -2.5% -31.6%

12.2% 3. 7% 6. 5% 500.0% 192.0% -72.0% -93.8% -21.4% -93.3% 107.4% 21.2% 0. 0% 151.3% 80.0% -57.1% 5. 8% 51.4% 109.7% -88.0% 215.8% -45.5% -24.0% -8.3% 6. 7% 294.3% 134.3% 55.5% 0. 9% 66.7% -6.5% -28.1% 67.3% 72.5% 77.8% -11.2% 18.8% -57.9% 40.0% -17.4% -98.6% 115.4% 4. 4% -59.0% -8.4% -20.0% 48.5% 72.7% -7.1% 9. 8% 29.1% 12.6% 31.5% 44.6% -12.5% -21.7% -13.5% 18.8% 110.8% 175.5% 6. 1% 47.4% 200.0% 10.3% 45.8% -17.0% -53.3% -55.0% -76.7% 74.3% 50.1% 10.3% -6.7% 129.3% -41.7% -7.0% 21.5% 38.6% 25.0% 88.5% 37.5% 39.2% 66.7% -4.0% -25.0% -47.1% -41.2% 30.7% -16.3% -12.7%

10.0% 94.8% 30.1% 12.5% 48.1% -70. 0% -95. 1% -4.5% -95. 0% 105. 7% NM -80. 0% 537. 6% -97. 4% -70. 0% 184. 4% 9.9% 97.0% -97. 6% 71.4% -25. 0% -62. 0% 45.8% 60.0% 245. 0% 455. 6% 284. 6% 28.9% 150. 0% 23.6% -12. 1% 113. 0% NM 80.6% 49.1% 19.7% -49. 2% 133. 3% -10. 6% -99. 4% 297. 5% -27. 7% -68. 5% -33. 3% -20. 0% 5.1% 103. 1% 64.6% -20. 8% 517. 5% 69.9% 105. 6% 28.6% 16.7% -62. 8% -54. 1% 75.6% 237. 3% 189. 9% -2.2% -29. 6% 0.0% 110. 4% 137. 3% 76.6% 75.0% -98. 5% -96. 5% -69. 5% 56.5% -22. 6% -12. 5% 229. 7% -99. 1% -31. 0% -19. 6% 205. 0% -72. 2% 30.5% -35. 3% 115. 4% -33. 3% 204. 6% -47. 1% -50. 0% -50. 0% 34.1% 30.5% -46. 8%

-20.3% -56.7% -41.0% -55.0% -29.8% -85.5% -95.1% -44.3% -99.0% -35.5% -34.4% -93.3% -8.5% -97.8% -87.2% -35.7% -6.1% -5.8% -97.6% -39.4% -57.1% -63.8% -47.8% -84.2% -13.8% -4.4% -27.3% -40.7% -16.7% -20.7% -37.8% -37.6% -9.2% -22.3% -38.5% -9.9% -63.9% -12.5% -35.0% -99.2% -16.1% -43.0% -83.6% -39.7% -60.0% -14.3% -1.1% -21.0% -40.0% -17.5% -31.3% -18.8% -37.7% -51.7% -68.3% -58.4% -1.0% -19.2% -11.0% -24.6% -41.7% -11.8% -24.0% -12.2% -36.1% -67.6% -99.3% -99.3% -72.8% -3.2% -26.6% -68.9% -0.4% -99.3% -46.6% -27.7% -39.6% -50.0% -4.5% -89.6% -1.4% -78.3% -43.4% -74.0% -62.5% -80.4% -2.3% -34.8% -53.6%

71.4% -87.0% -3.8% 0. 0%

133.3% -99.2% -4.6% -3.2%

100.0% -99.2% 0.0% 0.0%

500.0% -98.6% 29.4% 10.3%

537. 6% -99. 4% 45.2% 16.7%

-0.4% -99.3% -42.9% -38.5%

Page 15

C omparable C ompany Analys is > Web 2.0 Valuation Multiples C ompany Name

S ec tor

C ountry

P rimary E xc hange

Ticker

Accelerize New Media, Inc. Actoz S oft C o., Ltd. AQ Intera ctive, Inc. As s ocia ted Media Holdings Inc. B igs tring C orp. B etawave C orpora tion B eyond C ommerce, Inc. B right T hings plc B roadW ebAs ia Inc. C DC C orp. C hangyou.com Limited C hina G atewa y C orpora tion C hines e G amer Interna tional C L IC K E R Inc. C ornerW orld C orporation C yberplex Inc. DA DA S pA DXN Holdings B hd Dibz Interna tiona l, Inc. DigitalP os t Interactive, Inc. DigitalT own, Inc. Dolphin Digital Media, Inc. E olith C o. L td. E xtens ions , Inc. F luid Mus ic C a nada, Inc. F rogs ter Interactive P ictures A G G amania Digital E ntertainment C o., Ltd. G ameO n C o Ltd. G eoS entric Oyj G iant Interactive G roup, Inc. G igaMedia Ltd. G ravity C o., Ltd G ree, Inc. G ungH o O nline E nterta inment, Inc. Ha nbitS oft, Inc. IAC /InterActiveC orp. IAS E nergy, Inc. is eemedia Inc. J umbuck E ntertainment Limited K A B Dis tribution Inc. K ings oft C o. Ltd. Lingo Media C orpora tion LiveW orld Inc. LookS ma rt, L td. Magnitude Information S ys tems Inc. Mixi, Inc. Modern T imes G roup Mtg AB MOK O .mobi Limited Myriad G roup AG NE OW IZ G ames C orporation NetDra gon W ebS oft, Inc. Netea s e.com Inc. NeuLion Incorporated NeXplore C orporation Ngi G roup Inc. Northgate T echnologies Limited O pen T ext C orp. O penwave S ys tems Inc. P erfect W orld C o., Ltd. P N I Digital Media Inc. Q uepa s a C orp. O AO R B C Information S ys tems S handa Interactive E nterta inment Ltd. S hutterfly, Inc. S K C ommunications C o., Ltd. S N AP Interactive, Inc. S N M G lobal Holdings S ocial Media V entures Inc. S ocialwis e, Inc. S ohu.com Inc. S park N etworks , Inc. S pectrumDN A, Inc. T encent Holdings Ltd. T he P a rent C ompany T he9 L imited T heS treet.com, Inc. T ree.C om, Inc. Unis erve C ommunications C orp. United Online Inc. UO MO Media, Inc V a lueC lick Inc. V O IS , Inc. W ebzen Inc. W izzard S oftware C orporation W orlds .com Inc. W ynds torm C orporation XIN G AG Y D Online C orp. Y nk K orea Inc.

Direct Marketing G aming G aming Mobile Ins ta nt Mes s aging Media S ocial Networking S ocial Networking S ocial Networking G aming G aming Mobile G aming Direct Marketing C ontent A dvertis ing S ocial Networking S ocial Networking S NS Apps C ontent S ocial Networking S ocial Networking G aming C ontent Media G aming G aming G aming Mobile G aming G aming G aming S ocial Networking Media G aming Media V ideo C ontent S ocial Networking C ontent G aming L earning S ocial Networking Direct Marketing S ocial Networking S ocial Networking Media S ocial Networking Mobile G aming G aming G aming V ideo C ontent Media Direct Marketing C ollabora tion Mobile G aming Digita l Ima ging S ocial Networking Media G aming Digita l Ima ging S earch Dating Media S ocial Networking S ocial Networking G aming S ocial Networking Media P orta l Media G aming Media P orta l S ocial Networking Media Media Media S ocial Networking G aming P odca s ting C ontent C ontent S ocial Networking G aming G aming

U nited S ta tes S outh K orea J apan U nited S ta tes U nited S ta tes U nited S ta tes U nited S ta tes U nited K ingdom U nited S ta tes H ong K ong C hina U nited S ta tes T a iwa n U nited S ta tes U nited S ta tes C ana da Italy Mala ys ia U nited S ta tes U nited S ta tes U nited S ta tes U nited S ta tes S outh K orea U nited S ta tes U nited S ta tes G erma ny T a iwa n J apan F inland C hina T a iwa n S outh K orea J apan J apan S outh K orea U nited S ta tes C ana da C ana da Aus tra lia C ana da C hina C ana da U nited S ta tes U nited S ta tes U nited S ta tes J apan S weden Aus tra lia S witzerla nd S outh K orea C hina C hina C ana da U nited S ta tes J apan India C ana da U nited S ta tes C hina C ana da U nited S ta tes R us s ia C hina U nited S ta tes S outh K orea U nited S ta tes U nited S ta tes U nited S ta tes U nited S ta tes C hina U nited S ta tes U nited S ta tes C hina U nited S ta tes C hina U nited S ta tes U nited S ta tes C ana da U nited S ta tes C ana da U nited S ta tes U nited S ta tes S outh K orea U nited S ta tes U nited S ta tes U nited S ta tes G erma ny S outh K orea S outh K orea

OTCB B K OS E TS E OTCP K OTCB B OTCB B OTCB B AIM OTCP K N as da qG S N as da qG S OTCP K GTS M OTCB B OTCB B TS X CM K LS E OTCP K OTCB B OTCB B OTCB B K OS E OTCP K TS X XT R A GTS M TS E H LS E NY S E N as da qG S N as da qG M TS E OS E K OS E N as da qG S OTCB B T S XV AS X TS X S E HK T S XV OTCP K N as da qG M OTCB B TS E OM AS X SWX K OS E S E HK N as da qG S TS X OTCP K TS E BS E N as da qG S N as da qG S N as da qG S T S XV OTCB B R TS N as da qG S N as da qG S K OS E OTCB B OTCP K OTCP K OTCB B N as da qG S AME X OTCB B S E HK OTCP K N as da qG S N as da qG M N as da qG M T S XV N as da qG S OTCB B N as da qG S OTCB B N as da qG M AME X OTCB B OTCP K XT R A K OS E K OS E

AC LZ A052790 3838 AS MH BSGC B W AV B YOC AIM:B G T BWBA C HIN.A C Y OU CGW Y G T S M:3083 C LK Z CW R L T S X: C X C M:DA DXN DIB Z DG L P DG T W DP DM A041060 E XT I T S X:F MN FR G 6180 3812 G E O1V GA G IG M GR VY T S E : 3632 3765 A047080 IAC I IAS A.E IE E AS X:J MB T S X:K AB 3888 T S XV : LM LV W D L OOK MA G Y 2121 MT G B MK B MY R N A095660 777 NT E S T S X:NL N NXP C 2497 590057 OT E X OP W V PWRD T S XV :P N QP S A R BCI S NDA S FLY A066270 S TVI S NMN S MV I S CLW S O HU L OV S P XA 700 K IDS .Q NC T Y TS CM TREE T S XV :US S U NT D UO MO V CLK V OIS W ZE N W ZE W DDD W Y ND O1B C A052770 A023770

High Low Average Median

Figure 20. Valuation Comparison Source. Capital IQ

TE V/L TM R evenue

TE V/ NTM R evenue

TE V/L TM E B ITDA

TE V/NTM E B ITDA

P /L TM E P S

P /NTM E P S

P /TangB V

15.4 113.2 29.8 0.4 2.4 1.2 4.9 5.9 2.5 268.1 1,744.6 0.0 1,231.9 0.7 5.7 76.7 182.6 42.6 0.0 4.6 41.1 20.4 36.7 7.1 66.6 76.9 234.1 97.4 65.8 1,718.7 262.2 45.6 2,423.2 278.7 75.0 2,539.5 7.1 6.6 16.2 0.6 1,120.1 10.8 1.3 20.5 5.4 1,102.8 3,113.5 7.3 192.9 654.5 334.9 5,094.2 85.0 39.0 39.1 26.4 2,297.6 211.3 2,211.2 55.0 17.8 208.1 3,321.1 405.3 288.1 3.8 0.0 0.0 27.0 2,683.0 50.6 6.8 33,964.6 0.2 223.1 91.8 85.3 1.1 757.1 9.5 1,197.5 4.1 31.4 22.7 4.7 1.8 286.5 101.6 18.0

4.6x 0.7x 0.1x 12.6x 0.9x 0.7x 6.1x 0.0x 18.8x 0.3x 2.4x 0.6x 1.0x 0.7x 6.7x 36.7x 2.5x 11.2x 7.8x 1.5x 0.3x 12.1x 1.0x 14.8x 2.0x 1.0x 0.6x 3.6x 0.6x 8.1x 8.2x 0.0x 7.2x 1.9x 9.1x 3.0x 3.1x 2.1x 3.5x 25.3x 0.3x 3.0x 0.5x 0.7x 2.5x 0.0x 1.6x 1.5x 0.6x 1.1x 4.5x 4.5x 1.0x 26.9x 0.2x 0.4x 0.4x 0.2x 1.1x 12.6x 1.9x 4.5x 4.0x 1.9x 1.4x

0.1x 0.8x 4.7x 17.7x 0.5x 0.9x 1.4x 10.0x 1.0x 7.3x 0.6x 0.6x 6.6x 6.2x 1.8x 2.7x 2.5x 0.5x 3.5x 2.1x 1.0x 1.5x 3.9x 20.6x 0.2x 0.5x 0.4x 1.1x 2.0x 3.0x 1.5x -

3. 1x 10.5x 10.0x 33.4x 5. 8x 7. 3x 5. 2x 8. 4x 1. 1x 24.6x 9. 2x 43.5x 15.2x 1. 4x 18.3x 21.3x 12.2x 11.6x 7. 3x 11.3x 20.9x 1. 3x 23.0x 0. 3x 12.5x 23.0x 2. 3x 10.4x 4. 5x 14.0x 5. 0x 10.7x 13.8x 8. 9x 13.7x

7.4x 8.2x 28.8x 4.5x 6.2x 4.8x 13.0x 4.6x 1.5x 12.6x 19.6x 13.3x 9.3x 9.4x 4.6x 6.6x 6.9x 5.3x 8.0x 8.6x 48.9x 12.8x 8.2x 4.3x 7.6x 8.3x 4.9x -

16.0x 12.0x 43.7x 6.9x 7.1x 20.1x 9.7x 2.0x 10.4x 0.0x 51.4x 60.2x 13.3x 12.0x 4.6x 22.3x 53.6x 14.9x 34.0x 13.6x 2.9x 38.3x 3.2x 2.4x 6.7x 15.9x 13.9x 69.3x 2.5x 0.0x 18.0x 29.4x 10.8x -

8.8x 10.7x 26.1x 7.8x 17.3x 1.5x 15.8x 9.7x 26.4x 34.3x 3.4x 16.1x 46.7x 16.0x 11.9x 15.8x 1.5x 14.5x 31.6x 14.3x 14.0x 4.7x 13.6x 19.2x 57.9x 50.8x 6.8x 21.4x 16.9x -

1.8x 0.5x 0.2x 11.8x 21.1x 3.0x 0.9x 3.3x 6.2x 9.4x 3.0x 1.2x 54.3x 0.3x 2.2x 0.0x 23.8x 20.8x 2.1x 1.2x 5.4x 1.5x 0.0x 6.2x 19.3x 0.5x 0.8x 7.3x 7.5x 17.2x 1.8x 0.8x 6.2x 0.8x 3.1x 1.5x 19.2x 0.9x 2.4x 2.1x 5.2x 51.8x 68.0x 30.9x 0.1x 1.2x 1.1x 7.8x 26.3x 0.0x 9.1x 3.4x 0.9x

33,964.6 0.0 811.1 42.6

36.7x 0.0x 4.6x 1.9x

20.6x 0.1x 3.4x 1.5x

43.5x 0. 3x 12.1x 10.5x

48.9x 1.5x 10.3x 8.0x

69.3x 0.0x 18.8x 13.3x

57.9x 1.5x 18.5x 15.8x

68.0x 0.0x 9.0x 3.0x

US D Market C ap ($m)

Page 16

C omparable C ompany Analys is > Web 2.0 S ummary by C ountry C ompany Name

US D Market C ap ($m)

United S tates

38

C hina

C a na da

10

U nited S ta tes

C hina

10

S outh K orea

8

Avg US D Market C ap ($m) 49, 633. 4 5, 811. 3

US D L TM Total R ev ($m)

US D L TM Total E B ITDA ($m)

C hina

4,963. 3

C hina

4,152. 4

C hina

S weden

2,974. 2

United S tates

3,887. 3

S weden

E B ITDA % 2, 070. 2 304. 6

C hina

48. 8%

A us tralia

42. 8%

J a pan

3, 871. 5

J apan

645. 3

S weden

1,982. 6

United S tates

290. 0

T aiwan

37. 1%

S weden

2, 974. 2

T aiwan

577. 9

C a na da

1,015. 0

C a na da

200. 0

J apan

24. 2%

J a pa n

6

C anada

2, 488. 2

Hong K ong

294. 6

S outh K orea

707. 3

J a pa n

186. 0

S weden

15. 4%

T a iwa n

3

T a iwa n

1, 733. 6

C anada

248. 8

J a pa n

634. 4

S outh K orea

121. 9

Mala ys ia

14. 4%

1, 527. 4

Aus tralia

2

S outh K orea

G erma ny

2

G ermany

317. 0

S outh K orea

190. 9

T a iwa n

385. 8

T a iwa n

59. 8

Italy

13. 1%

Ita ly

165. 4

Hong K ong

361. 6

Ita ly

31. 9

R us s ia

13. 1%

S witzerla nd

1

Hong K ong

294. 6

R us s ia

160. 9

Ita ly

242. 6

Hong K ong

25. 1

S outh K orea

12. 7%

Hong K ong

1

Ita ly

165. 4

G ermany

158. 5

R us s ia

156. 2

R us s ia

20. 4

Hong K ong

6. 9%

F inla nd

1

R us s ia

160. 9

U nited S ta tes

152. 9

India

82. 8

G erma ny

12. 5

S witzerla nd

1. 9%

Ita ly

1

S witzerla nd

92. 0

S witzerla nd

92. 0

Ma lays ia

77. 1

Ma lays ia

11. 1

C anada

-8. 5%

United K ingdom

1

F inland

65. 9

F inland

65. 9

G erma ny

68. 7

Aus tralia

4. 5

G ermany

-9. 1%

India

1

Malays ia

39. 8

Malays ia

39. 8

S witzerla nd

40. 0

S witzerla nd

0. 8

U nited S ta tes

-21. 9%

S weden

1

India

31. 0

India

31. 0

Aus tralia

17. 8

Norwa y

-1. 1

India

-50. 0%

R us s ia

1

Aus tralia

22. 1

Aus tralia

11. 0

F inla nd

5. 5

United K ingdom

-2. 7

Norway

-50. 6%

Ma lays ia

1

U nited K ingdom

6. 0

U nited K ingdom

6. 0

Norwa y

2. 3

F inla nd

-17. 5

U nited K ingdom

Norwa y

1

Norway

0. 1

Norway

0. 1

United K ingdom

0. 0

India

-41. 4

F inland

G rand Total

89

G rand Total

69,234.6

777.9

G rand Total

G rand Total

13,819.5

G rand Total

3,276.1

G rand Total

NA NA 5.1%

Figure 21. Comparison by Country Source. Capital IQ

C omparable C ompany Analys is > Web 2.0 S ummary by E xc hange C ompany Name

US D Market C ap ($m)

Avg US D Market C ap ($m)

US D L TM Total R ev ($m)

S E HK

31, 520. 4

S E HK

Na s daqG S

14

Nas da qG S

24, 385. 7

OM

OT C P K

11

TS E

3, 569. 2

NY S E

1,750. 4

Na s daqG S

498. 6

OM

304. 6

S E HK

40. 6%

6

OM

2, 974. 2

Nas da qG S

1,741. 8

CM

242. 6

TS E

160. 2

GTS M

37. 1%

2,974. 2

OM S E HK

1,982. 6

E B ITDA %

18

K OS E

10,506. 8

US D L TM Total E B ITDA ($m)

OT C B B

540. 0

Na s daqG S S E HK

1, 796. 0 767. 5

NY S E

62. 5%

AS X

42. 8%

TS E

5

NY S E

1, 750. 4

GTS M

715. 0

NY S E

198. 5

NY S E

124. 1

Nas da qG S

30. 4%

Na s daqG M

5

K OS E

1, 437. 0

TSE

713. 8

RTS

156. 2

K OS E

103. 2

TSE

24. 6%

TS X

4

GTS M

1, 430. 0

T S XV

4

XT R A

317. 0

OS E

302. 3

OS E

116. 1

GTS M

59. 8

OS E

22. 2%

K OS E

239. 5

K OS E

106. 0

CM

31. 9

OM

15. 4%

S E HK

3

OS E

302. 3

CM

165. 4

TS E

103. 7

OS E

25. 8

K LS E

14. 4%

AME X

2

Nas da qG M

279. 7

R TS

160. 9

GTS M

101. 1

RTS

20. 4

CM

13. 1% 13. 1%

AS X

2

TS X

243. 6

XT R A

158. 5

BSE

82. 8

Na s daqG M

15. 6

R TS

XT R A

2

OT C B B

230. 9

SWX

92. 0

Na s daqG M

82. 4

XT R A

12. 5

K OS E

9. 6%

GTS M

2

CM

165. 4

HLS E

65. 9

K LS E

77. 1

K LS E

11. 1

Nas da qG M

7. 7%

SWX

1

R TS

160. 9

HL S E

1

SWX

92. 0

TSX

60. 9

TS X

46. 4

AME X

6. 2

T S XV

5. 6%

Nas da qG M

55. 9

SWX

40. 0

AS X

4. 5

S WX

1. 9%

CM

1

T S XV

76. 6

K LS E

39. 8

XT R A

34. 3

SWX

BS E

1

AME X

68. 5

AME X

34. 2

AME X

27. 9

OT C NO

0. 8

XT R A

-9. 1%

-1. 1

A ME X

-31. 8%

NY S E

1

HLS E

65. 9

BS E

31. 0

OT C P K

16. 5

AIM

-2. 7

TSX

-34. 7%

OS E

1

OT C P K

65. 8

T S XV

19. 1

T S XV

12. 0

TS X

-4. 3

OTCB B

-38. 8%

AIM

1

K LS E

39. 8

OT C B B

12. 8

AS X

8. 9

T S XV

-4. 6

OM

1

BS E

31. 0

AS X

11. 0

HL S E

5. 5

HL S E

-17. 5

OTCP K

-41. 5%

BSE

-50. 0% -50. 6%

RTS

1

AS X

22. 1

AIM

6. 0

OT C B B

2. 3

OT C P K

-34. 1

O T C NO

K LS E

1

AIM

6. 0

OT C P K

6. 0

OT C NO

2. 3

BSE

-41. 4

A IM

NA

OT C NO

1

OT C NO

0. 1

OT C NO

0. 1

AIM

0. 0

OT C B B

-62. 4

HLS E

NA

G rand Total

89

G rand Total

Figure 22. Comparison by Exchange Source. Capital IQ

69,234.6

G rand Total

777.9

G rand Total

13,819.5

G rand Total

3,276.1

G rand Total

5.1%

Page 17

Financ ing - L as t Three Months (US $ m) F in. Amount (Million)

Type of financ ing

Month

C ompany Name

Aug-09

Turbine

C ountry US A

Angel/S eed

S mith & Tinker

US A

Mint

US A

Zoove

US A

R ichR elevance

US A

Traffiq

US A

MediaMath

US A

B ill.c om

US A

E do Interactive

US A

InnoC entive

US A

OneR iot

US A

7.0

7.0

B alihoo

US A

7.0

7.0

B oxee

US A

6.0

6.0

P olyvore

US A

5.6

5.6

Fanbas e

US A

MOG

US A

OurS tage

US A

Z2L ive

US A

K ODA

US A

S coreloop

G erma ny

R oblox

US A

Tremor Media

US A

iS ocket

US A

2.0

R ights Flow

US A

1.5

P lis ta

G erma ny

C hes s C ube

S outh Africa

1. 3

1.3

L inks ify

US A

0. 5

0.5

iS yndica

US A

0. 4

0.4

S eries C

12. 5 10. 0 10. 0 8.5

8.5 7.3

7.3

5.0

5.0 5.0

3.0

3.0

3.0

3. 0

3.0 2.8

2.8

2. 2

2.2 2.0

2.0 1.5 1.4

0. 0

0.0 11.5

77.6

43.6

UK

Mzinga

US A

InXpo

US A

J obvite

US A

8.3

R iot G ames

US A

8.0

NextB io

US A

Imeem

US A

6.0

Vuc lip

US A

6.0

YuMe

US A

B ooyah

US A

NeoE dge

US A

4.0

Allianc e Health Networks

US A

3.3

Unis fair

US A

C onduit L abs

US A

Mocapay

US A

Fwix

US A

Vantrix

C anada

Mas hL ogic

US A

G reys tripe

US A

L oomia

US A

FourS quare

US A

E duFire

US A

Fluther

US A

Trans Gaming Inc.

C anada

OnL ive

US A

US A

9.0

Amie S treet

US A

ViVu

US A

6.0 6.0

UK

L is tia

US A

5.0 5.0 4.0 3.3 3. 1

3.1

3.0

3.0 3.0

3.0

2.8

2.8 2.6

2.6

2.5

2.5 2.0

2.0

1. 5

1.5 1.4

1.4

1.3

1.3

0. 6

0.6 0. 5 2.0

0.5 16.9

52.3

27.9

23.1

110.0

22.5

22. 5 22. 1

19.0

19. 0

16.0

16. 0

10.0

10. 0

10.0

10. 0 6.5

4.0

4.0

3.9

3.9

3.0

3.0 2.6

2.6 2. 0

2.0

1.2

1.2

1. 0

1.0

1. 0

1.0

0. 4

Oct-09 Total

2.4

G rand Total

28.8

232.8

22.1

6.5

US A

L inkedex

8.0

5.0

US A

DailyB ooth

Figure 23. Financing, Last Three Months Source. Company reports

8.0

US A

Tec hnorati DataS ync

8.3

5.0

UK

Fizzbac k

10. 0 9.0

8.0

US A

S ometrics

16. 0 10. 0

US A

100. 0 20. 0

16.0

S pigit US A

221.6 100.0

US A

R eality Mobile

63.2

20. 0

HubS pot Ooyala

2.0

1.4

L ivebookings

US A

5.0

3.0

US A

E ngine Yard

8.5

8. 5

US A

F ra nce

13. 2

10.0

E ns equenc e

US A

14. 1

10. 0

0.6

Grand Total 50. 0 29. 0

Twitter

DailyMotion

S eries E

12.5

25.8

P opC ap G ames

S eries D 50. 0

13. 2

S ep-09 Total Oct-09

S eries B

14.1

Aug-09 Total S ep-09

S eries A

29.0

US A

DailyB ooth

Debt financ ing

0.4

2.0

33.2

30.5

57.1

2.0

61.6

160.3

128.6

88.3

125.2 110.0

579.6

Page 18

C ompany Des c riptions - C urrent Month C apital Market Ac tivity C ompany

HQ

Webs ite

Des cription

Amie S treet

United S ta tes

www. amies treet. com

Amie S treet, Inc. , a W eb bas ed s ocial mus ic s tore, enables members to dis cover, download, and s hare mus ic. T he company wa s founded in 2006 and is bas ed in Long Is la nd C ity, New Y ork . DailyB ooth lets us ers follow their friends and update them in real-time through the us e of pictures and s ta tus updates .

Daily B ooth

United S ta tes

www. dailybooth. com

DailyMotion

F rance

www. dailymotion. com

Dailymotion S AR L provides on-line video content in F rance and E urope. It operates a video entertainment W ebs ite tha t provides video s haring s ervices . T he company a ls o ena bles s ha ring of official and profes s iona l contents . Dailymotion S AR L was founded in 2005 and is bas ed in P aris , F rance.

DataS ync

United S ta tes

www. datas yncs uite. com

DataS ync C orporation develops open s ource cons olidation s oftware. T he company develops DataS ync S uite, a s oftware pla tform that integrates core applications into an open s ource s oftware-a s -a-s ervice web porta l. Data S ync C orporation wa s founded in 2005 and is bas ed in S ioux F a lls , S outh Dakota.

E ngine Yard

United S ta tes

www. engineyard. com

E ngine Y a rd, Inc. provides managed hos ting a nd deployment s olutions for R uby and R ails applications . T he company offers a clus ter computing platform, deployment s upport, and data center s ervices . It helps its clients in building s ites and a pplica tions on-dema nd. E ngine Y ard, Inc. was founded in 2006 and is bas ed in S a n F ra ncis co, C alifornia with additiona l locations in the United S tates , C anada, E urope, Is ra el, the P hilippines , Aus tralia, and New Zealand.

F eedR oom

United S ta tes

www. feedroom. com

T he F eedR oom, Inc. provides W eb video s olutions and technology for corporations , media/publis hing organiz ations , and government a gencies . It offers broadband video dis tribution for W eb, s ea rch engines , and podcas ting; broadband video encoding, ma nagement, and delivery; performance reporting; broadband video application des ign and development; media advertis ing s ervices ; s ubs cription a nd regis tration tools ; email video a lert delivery a nd tracking; a nd original content development and production. T he company wa s founded in 1999 and is bas ed in New Y ork, New Y ork . As of S eptember 30, 2009, T he F eedR oom, Inc. opera tes as a s ubs idiary of K IT digital, Inc.

F izzbac k

UK

www2. fizz back. com

T he F izz back G roup Limited provides an on-demand s olution that drives cus tomer engagement at the point-of-experience. Its s olution helps companies to lis ten, res pond, and act in real-time to their cus tomers ' comments . T he offers F iz zback E nga gement P latform that enables multi-channel cus tomer communica tion initiated by the cus tomer or the company in an automated or intervened manner; and F izzback C hannel C onnector tha t collects uns tructured cus tomer feedback covering S MS text, email, voice, W eb, a nd comment cards . It als o provides F iz zback s ervice, which captures and analys es cons umer feedback in real-time. T he company s erves telecom and media, reta il and cons umer goods , financial s ervices , trans portation and tra vel, and leis ure and entertainment indus tries . T he F izz back G roup was formerly k nown as Ins tant Market Intelligence Limited and changed its name to T he F iz zback G roup Limited in J anuary 2007. T he company was founded in 2004 and is bas ed in London, the United K ingdom.

HubS pot

United S ta tes

www. hubs pot. com

L inkedex

UK

NA

L is tia

United S ta tes

www. lis tia. com

HubS pot, Inc. offers B 2B inbound ma rketing s oftwa re. Its products include HubS pot Owner, which generates qualified leads and convert leads into s ales ; and HubS pot Marketer that offers inbound mark eting tools . T he company als o provides s earch engine optimiz ation, bus ines s blogging, competitor analys is , clos ed-loop marketing analytics , W ebs ite editor, lea d tracking a nd intelligence, lead gra der, landing page wiz ard, marketing intelligence, s ocial media, and inbound ma rketing s olutions . HubS pot, Inc. was founded in 2006 and is bas ed in C ambridge, Mas s a chus etts . B as ed in London and S an F rancis co, Linkedex aims to help companies a nalys e the proces s by which s earch engines deliver their res ults a nd achieve higher rankings in na tural (non-pa id-for) s earch for their brands a nd s ervices . L is tia, which launched in Augus t 2009, is eB ay for free s tuff. Us ers get a certain number of credits which they bid for the item, s o whoever wins the auction is the pers on who wanted it the mos t. Us ers get credits in three ways : every us er gets a certa in number automa tically, and you can get more by auctioning items , by referring friends , and by buying them. T he company is bas ed in S unnyvale, C alifornia.

Ooyala

United S ta tes

www. ooya la. com

P opC ap G ames

United S ta tes

www. popcap.com

O oya la is a video technology company that provides indus try-leading s olutions for managing, dis tributing and monetiz ing high-quality video online. F ounded by former G oogle engineers in April 2007, Ooyala takes a novel approach at delivering video, ta rgeting ads and collecting video a nalytics . S ince launching its flags hip product, B acklot, in December of 2007, O oyala has s igned up over 1000 paying cus tomers including W arner B rothers , AOL/B ebo, National G eogra phic, T V G uide a nd the G lam network. T he company is bas ed in Mountain V iew, C opC alifornia. P ap G ames , Inc. develops and publis hes cas ual games . Its games a re played on the W eb, des ktop computers , cell phones , s martphones , P DAs , pock et P C s , iP ods , iP hones , ga me cons oles , and in-flight entertainment s ys tems . T he compa ny offers its products to W eb portals , retail s tores , mobile operators and developers , and game device manufacturers . P opC ap G ames , Inc. was founded in 2000 a nd is bas ed in S eattle, W as hington. It has operations in C hicago, Illinois ; S an F rancis co, C a lifornia; S hanghai, C hina; Dublin, Ireland; and V ancouver, B . CLL . , CC anada . mobile video and data s haring technology. T he company was founded in 2003 and is bas ed in Herndon, R eality Mobile provides

R eality Mobile S cout L abs

United S ta tes United S ta tes

www. realitymobile. com www. s coutlabs . com

S ometrics

United S ta tes

s ometrics . com

S ometrics , Inc. operates as an analytics and a d platform s tartup compa ny s pecializ ing in s ocial media. It offers analytics and ad managing s olutions that focus on s ocial networking platforms a nd applications . T he company als o provides s ocial a dvertis ing s olutions , s uch as dis plays , engagements , and bra nd as s es s ments , as well as s ocial planners for a dvertis ers . In addition, it offers S ocial Analytics that provide a nalys is for s ocial applications a nd W ebs ites ; S ocial Ad Manager that helps to s erve and optimiz e ads to increas e revenue acros s s ocia l media properties ; and V irtual C urrency Mana ger, a virtual currency platform des igned to provide an interface to manage dis parate offer networks and relations hips for publis hers . S ometrics enables developers to know who’s vis iting their s ites or us ing their applications , including details about activity, tra ffic, demographics , interes ts , a nd s ocia l actions within the s ocial W eb. T he compa ny s upports F acebook, Mys pace, B ebo, F riends ter, a nd hi5 platforms . S ometrics , Inc. wa s founded in 2007 and is headquartered in Los Angeles , C alifornia.

S pigit

United S ta tes

www. s pigit. com

S pigit, Inc. des igns , develops , and dis tributes s ocial networking s oftware for bus ines s innovation. It provides s tra tegic and technical cons ulting, webs ite des igning, project forecas ting, C R M applications , employee engagement tra cking, web logs , and currency a nd idea management s ervices . T he compa ny markets its products under InnovationS pigit, IdeaS pigit, and P redictionS pigit brand names . S pigit, Inc. is bas ed in P leas anton, C alifornia.

Technorati

United S ta tes

www. technorati.com

T echnorati, Inc. engages in s earching, s urfacing, a nd organizing blogs a nd us er-generated content on the W eb. It offers various citizen media on the W eb, which include blogs , videos , vlogs , podcas ts , photos , and games . T he company was founded in 2002 and is ba s ed in S an F rancis co, C alifornia.

ViVu

United S ta tes

www. vivu. tv

V iV u, Inc. develops participative event platform that enables live video pa rticipation from a pers onal computer, Mac, a nd Linux without any proprietary downloa ds . It offers a s olution for event organiz ers to create, publis h, a nd manage quality video events . T he company provides its products for on-s ite deployment, online meetings and events , s ales pres entations , live interactive training, online events , IT helpdes k s upport, and cus tomer s upport, as well as for face-to-face meetings , ca lendar invitations , outlook integration, e-learning, and video collaboration s ervices . In addition, it offers its s olutions that are us ed in remote training cours es , s ales training on new products , and remote live video caller participation during W ebcas ts . T he company was incorporated in 2008 and is bas ed in S unnyvale, C alifornia.

Yext

United S ta tes

www. yext. com

Y ext, Inc. provides online directories . It focus es on repres enting va rious bus ines s es acros s the United S tates . T he company wa s founded in 2006 and is bas ed in New Y ork, New Y ork .

Figure 24. Company Descriptions Source. Company reports, Capital IQ, Crunchbase

irginia. SV cout La bs is a powerful, web-bas ed application tha t finds s ignals in the nois e to compa nies build better products and s tronger cus tomer relations hips . T he company provides technology and a collaborative platform for companies and their agents to lis ten to cus tomers and engage with them out acros s the Internet.

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RELEVANT DISCLOSURES APPLICABLE TO: NONE LIST OF DISCLOSURE TERMS: 1.

None applicable.

ANALYST CERTIFICATION Each analyst of Research Capital Corporation whose name appears in this report hereby certifies that (i) the recommendations and opinions expressed in this research report accurately reflect the analyst’s personal views and (ii) no part of the research analyst’s compensation was or will be directly or indirectly related to the specific conclusions or recommendations expressed in this research report.

I n f o r ma t i o n a b o u t Re s e a r ch C a p i t a l C o r p o r a t i o n ’ s Ra t i n g S y s t e m, t h e d i s t r i b u t i o n o f o u r r e s e a r ch t o cl i e n t s a n d t h e p e r ce n t a g e o f r e c o m me n d a t i o n s wh i c h a r e i n e a c h o f o u r r a t i n g c a t e g o r i e s i s a v a i l a b l e o n o u r we b si t e a t ww w. r e s e a r ch c a p i t a l . c o m. T h e i n f o r ma t i o n c o n t a i n e d i n t h i s r e p o r t h a s b e e n d r a wn f r o m s o u r c e s b e l i e ve d t o b e r e l i a b l e b u t i t s a c cu r a c y o r co mp l e t e n e ss i s n o t g u a r a n t e e d , n o r i n p r o vi d i n g i t d o e s R e s e a r c h Ca p i t a l C o r p o r a t i o n a s s u me a n y r e sp o n si b i l i t y o r l i a b i l i t y . R e s e a r ch C a p i t a l C o r p o r a t i o n , i t s d i r e ct o r s , o f f i c e r s a n d o t h e r e mp l o y e e s ma y , f r o m t i me t o t i me , h a v e p o si t i o n s i n t h e s e cu r i t i e s me n t i o n e d h e r e i n . Co n t e n t s o f t h i s r e p o r t c a n n o t b e r e p r o d u c e d i n wh o l e o r i n p a r t wi t h o u t t h e e xp r e ss e d p e r mi s si o n o f R e se a r ch C a p i t a l C o r p o r a t i o n . ( U . S . I n s t i t u t i o n a l Cl i e n t s — Re s e a r ch C a p i t a l U . S. A . I n c. ( a wh o l l y o wn e d s u b si d i a r y o f R e s e a r c h C a p i t a l Co r p o r a t i o n ) a cc e p t s r e s p o n si b i l i t y f o r t h e c o n t e n t s o f t h i s r e p o r t s u b je c t t o t h e t e r ms & l i mi t a t i o n s s e t o u t a b o v e . F i r ms o r i n s t i t u t i o n s r e ce i vi n g t h i s r e p o r t s h o u l d e f f e ct t r a n s a ct i o n s i n s e c u r i t i e s d i sc u s se d i n t h e r e p o r t t h r o u g h R e s e a r ch C a p i t a l U . S . A . I n c. , a B r o k e r - D e a l e r R e g i s t e r e d wi t h t h e U n i t e d S t a t e s S e cu r i t i e s a n d E xc h a n g e C o m mi s si o n ) .

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