2. Key Developments (past week)
Deals (M&A, Finance) – Online Luxury – Hot Sector in a Poorer World
Booyah (virtual world operator) raised $20 mm in Series C financing.
Social media brand and charity promoter, SocialVibe, raised an $11.7 mm financing
round.
Activity in the online luxury retail space headed up this week with Brandsclub (Brazilian
luxury flash retailer) in a $17 mm funding and Gilt Groupe raising $35 mm.
Financial Results/Guidance
Fluid Music (TSX:FMN, digital music distributor) reported Q1/F10 revenue of $15.9 mm
(vs. $1.3 mm in the same period last year) and EPS of ($0.06) vs. ($0.03) in Q1/F09.
Points International (TSX:PTS, rewards program manager) reported strong revenue
growth – up 11% Y/Y to $23.5 mm, and break-even EPS. Excluding contribution last
year from a discontinued relationship with a major customer (Delta Airlines), revenue
growth was 205% Y/Y.
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4. Aggregate Public Data
Web 2.0 Public Companies Total Median Max Min
# Companies 100 - - -
Market Cap (US$ mm) 82,162.9 67.9 36,142.4 1.2
Revenue (US$ mm) 23,048.3 59.8 3,057.7 0.0
1 Year revenue growth 5.3% 857.0% -91.4%
EBITDA as % of revenue - 13.4% 67.7% -75.0%
Net cash (US$ mm) 9,044.1 2.1 1,827.7 -670.8
TEV/Revenue - 1.9x 41.8x 0.1x
TEV/EBITDA - 8.4x 36.6x 0.8x
P/E - 16.0x 83.4x 0.0x
Relative to 52 week high -37.8% 0.0% -97.6%
Source: CapitalIQ
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5. 5
0
5
10
15
20
25
30
Gaming
27
Social Networking
17
Media
10
7
Diversified
6
Marketing
5
Mobile
Source: CapitalIQ
3
Infrastructure
3
SMS/Voice
3
Enterprise
3
Advertising
2
Internet Retail
2
Virtual World
By Sector
2
Dating
2
Music
1
Vertical Communities
1
Collaboration
1
Podcasting
1
Learning
1
Video
1
Search
1
Payment
Financial Services 1
Public Company Distribution
0
5
10
15
20
25
30
35
40
45
United States
Canada
China
South Korea
Japan
Taiwan
Germany
Australia
United Kingdom
Hong Kong
Poland
Russia
By Country
Finland
Sweden
Malaysia
India
Italy
Switzerland
Israel
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10. 10
-
5.0
10.0
15.0
20.0
25.0
# Companies 2
Infrastructure
2
Music
1
Learning
8
Social Networking
4
Mobile
1
Vertical Communities
5
Diversified
6
Marketing
3
SMS/Voice
Gaming
20
1
Search
1
Podcasting
EV/Revenue
1
Collaboration
9
Media
3
Advertising
2
Internet Retail
3
Enterprise
1
Video
2
Dating
1
Financial Services
0
Virtual World
-
2.0
4.0
6.0
8.0
10.0
12.0
14.0
16.0
18.0
20.0
Average Valuation – by Sector
# Companies
2
Enterprise
1
Mobile
5
Diversified
6
Social Networking
2
Internet Retail
1
Collaboration
Gaming
13
EV/EBITDA
6
Media
3
Marketing
1
Dating
1
Advertising
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11. 11
0.0
5.0
10.0
15.0
20.0
25.0
30.0
35.0
40.0
45.0
Look S mart, Ltd.
C y berplex Inc.
Actoz S oft C o. , Ltd.
G ameO n C o Ltd.
Source: CapitalIQ
J umbuck E ntertainment Limited
R ealNetwork s Inc.
G igaMedia Ltd.
T ree. C om, Inc.
O penwave S y s tems Inc.
DADA S pA
G lu Mobile, Inc.
Northgate T echnologies Limited
P oints International Ltd.
Unis erve C ommunications C orp.
C DC C orp.
AQ Interactive, Inc.
Internet G roup S A
AO L, Inc.
0.2 0.20.30.30.40.40.4 0.4 0.50.60.60.6 0.70.70.70.70.80.80.8
IAC /InterActiveC orp.
U nited O nline, Inc .
T he New Y ork T imes C ompany
C ornerWorld C orporation
T heS treet.com, Inc.
O AO R B C Information S y s tems
HanbitS oft, Inc.
NetDragon WebS oft, Inc.
EV/Revenue Ranking
infoG R O U P , Inc.
Hutchis on T elecommunications H ong
S park Network s , Inc.
O riented Media G roup B erhad
G amania Digital E ntertainment C o. , Ltd.
S NAP Interactive, Inc.
Y D O nline C orp.
0.80.8 1.0 1.0 1.0 1.2 1.2 1.3 1.3 1.4 1.4 1.4 1.4 1.5 1.5
Y nk K orea Inc.
NeuLion Incorporated
S hutterfly , Inc.
V alueC lick , Inc.
S core Media Inc.
P NI Digital Media Inc.
Modern T imes G roup Mtg AB
1.6 1.8 1.8 1.9 2.12.1
G ungHo O nline E ntertainment, Inc.
XING AG
2.22.22.2
S ohu.com Inc.
U O MO Media, Inc
is eemedia Inc.
Webz en Inc.
O pen T ex t C orp.
Wiz z ard S oftware C orporation
My riad G roup AG
NE O WIZ G ames C orporation
V elti P lc
F rogs ter Interactive P ictures AG
2.72.82.8 2.93.03.0 3.1 3.13.13.4
S K C ommunications C o. , Ltd.
T aleo C orp.
3.74.4
C hangy ou. com Limited
DigitalP os t Interactive, Inc.
revenue multiple at 41.8x
SpectrumDNA has highest
Mix i, Inc.
K ings oft C orporation Limited
WebMediaB rands Inc
H U G H E S T elematic s , Inc .
4.54.6 4.74.74.9
U nilava C orporation
Acceleriz e New Media, Inc.
5.5 5.6 5.8
Lingo Media C orporation
8.0
G ree, Inc.
Dena C o. Ltd.
8.9 9.2
T rans G aming, Inc.
F luid Mus ic C anada, Inc.
10.4
C hines e G amer International
12.2
B ey ond C ommerce, Inc.
13.8
G eoS entric O y j
MO K O . mobi Limited
15.415.5
T encent Holdings Ltd.
19.0
P aid Inc.
19.7
B right T hings plc
31.4
S pectrumDNA, Inc.
41.8
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12. 12
0. 0
5. 0
10. 0
15. 0
20. 0
25. 0
30. 0
35. 0
40. 0
G ameO n C o L td.
Ac toz S oft C o. , Ltd.
1. 3 1. 6
Source: CapitalIQ
C y berplex Inc.
AO L , Inc .
2.4 2. 4
United O nline, Inc.
4. 2
T he New Y ork T imes C ompany
S ohu. c om Inc.
Hutchis on T elec ommunications H ong K ong Holdings
Ltd.
DADA S pA
5. 2 5. 3 5. 4 5. 8
NetDragon WebS oft, Inc.
C DC C orp.
S park Network s , Inc.
V alueC lick , Inc.
EV/EBITDA Ranking
Y D O nline C orp.
infoG R O UP , Inc.
C hangy ou. com L imited
6.4 6. 5 6. 6 6. 6 6. 7 6. 7 7. 0
Unis erve C ommunic ations C orp.
XING AG
G amania Digital E ntertainment C o. , L td.
P NI Digital Media Inc.
7.4 8. 1 8. 2 8. 4
G ungHo O nline E ntertainment, Inc.
8. 8
IAC /InterAc tiveC orp.
O pen T ex t C orp.
10. 1 10. 5
K ings oft C orporation L imited
11. 1
NE O WIZ G ames C orporation
S c ore Media Inc.
11. 5 12.0
at 36.6x
S hutterfly , Inc .
HanbitS oft, Inc .
G ree, Inc.
13. 2 13. 3 14. 0
Tencent leads the group
Y nk K orea Inc .
14. 2
Mix i, Inc.
V elti P lc
Modern T imes G roup Mtg AB
15. 2 15. 2 15.4
O penwave S y s tems Inc .
T heS treet. c om, Inc.
17. 0 17. 4
F rogs ter Interactive P ic tures AG
19. 5
Dena C o. L td.
20. 6
C hines e G amer International
23. 8
T aleo C orp.
27. 9
T encent H oldings L td.
36.6
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Excluding EV/EBITDA > 100x
