P. 1
Web 2.0 Weekly - June 22, 2010: "AOL Sells Bebo at Massive Loss"

Web 2.0 Weekly - June 22, 2010: "AOL Sells Bebo at Massive Loss"

|Views: 50|Likes:
Published by David Shore
Deals (M&A, Finance)
AOL is reported to have sold Bebo, the UK-based social network it bought just two years ago for $850 mm, to private equity firm Criterion Partners for under $10 mm. Based on our calculations, AOL paid the equivalent of $38 per Unique Visitor (UV) for Bebo, and sold it for under $1 per UV.

Positive price performance
The Web 2.0 public company universe rose again this week, with 60% of companies seeing their market cap rise vs. 33% falling and 7% flat.
Deals (M&A, Finance)
AOL is reported to have sold Bebo, the UK-based social network it bought just two years ago for $850 mm, to private equity firm Criterion Partners for under $10 mm. Based on our calculations, AOL paid the equivalent of $38 per Unique Visitor (UV) for Bebo, and sold it for under $1 per UV.

Positive price performance
The Web 2.0 public company universe rose again this week, with 60% of companies seeing their market cap rise vs. 33% falling and 7% flat.

More info:

Published by: David Shore on Jun 22, 2010
Copyright:Attribution Non-commercial

Availability:

Read on Scribd mobile: iPhone, iPad and Android.
download as PDF, TXT or read online from Scribd
See more
See less

04/27/2015

pdf

text

original

Web 2.

0 Weekly
“AOL Sells Bebo For Massive Loss”
June 22, 2010
David Shore, CFA, MBA 416.860.6784 dshore@mackieresearch.com
Damian Wojcichowsky, CFA 416.860.7652
This report has been created by Analysts that are employed by Mackie Research Capital Corporation, a Canadian Investment Dealer. For further disclosures, please see last page of this report. www.mackieresearch.com

Copyright © 2000-2010, Mackie Research Capital Corporation, All rights reserved

www.mackieresearch.com

Key Developments (past week)
Deals (M&A, Finance) – Bebo a Disastrous Investment for AOL
AOL is reported to have sold Bebo, the UK-based social network it bought just two years ago for $850 mm, to private equity firm Criterion Partners for under $10 mm. Based on our calculations, AOL paid the equivalent of $38 per Unique Visitor (UV) for Bebo, and sold it for under $1 per UV.

Financial Results/Guidance/Partnerships/Product
Multiplied Media (TSXV:MMC) announced it would be adding Telus Live Agents to its popular location-based search application, Poynt Mobile Data Corp. (OTCBB:MBYL) reported unaudited earnings results for the third quarter and nine months ended April 30, 2010. For the quarter, the company has reported net loss of $24,096 compared to $20,504 for the same period a year ago. For the nine months, the company has reported net loss of $137,531 compared to $129,675 for the same period a year ago. Net cash used in operations was $84,802 compared to $69,666 for the same period a year ago.

2

www.mackieresearch.com

Public Company Data

3

www.mackieresearch.com

Aggregate Public Data
Web 2.0 Public Companies
# Companies Market Cap (US$ mm) Revenue (US$ mm) 1 Year revenue growth EBITDA as % of revenue Net cash (US$ mm) TEV/Revenue TEV/EBITDA P/E Relative to 52 week high

Total
101 77,334.7 23,508.7 9,036.9 -

Median
73.1 56.9 5.7% 13.4% 2.3 2.0x 8.8x 17.0x -38.4%

Max
30,367.3 3,057.7 8961.6% 63.1% 1,835.9 37.2x 45.0x 91.3x -1.8%

Min
1.2 0.0 -100.0% -63.7% -670.8 0.0x 0.6x 0.0x -95.6%

Source: CapitalIQ

4

www.mackieresearch.com

5
10 15 20 25 30 0 28 Gaming 16 Social Networking 10 Media 8 Diversified 6 Marketing 5 Mobile 3 Infrastructure 3 SMS/Voice 3 Enterprise 3 Advertising 2 Internet Retail 2 Virtual World 2 Dating 2 Music 1 Vertical Communities 1 Collaboration 1 Podcasting 1 Learning 1 Video 1 Search 1 Payment 1 Financial Services 5

Public Company Distribution

Source: CapitalIQ

By Sector

10

15

20

25

30

35

40

45

0 United States Canada China South Korea Japan Taiwan Hong Kong Germany Poland Australia United Kingdom Italy Finland Sweden India Russia Malaysia Switzerland

5

By Country

www.mackieresearch.com

Valuation Dashboard – 1 Week
Market Cap
Flat 7%

EV/Revenue

Falling 44%

Flat 1%

Falling 33% Rising 60%

Rising 55%
EV/EBITDA P/E

Flat 2%
Falling 33%

Flat 0%

Falling 35%

Rising 63%

Rising 67%

6

www.mackieresearch.com

Source: CapitalIQ
Multiple (x) 0.0x 0.5x 1.0x 1.5x 2.0x 2.5x 3.0x 3.5x 4.0x 4.5x 5.0x

7

Median EV/Revenue

394040404141404343454647474747485051515050535656606161646666676564667071717274736871737372747679808280818081828286838584 # companies Median Long-term average

Revenue multiples increase slightly but remain well below LT average

5/4/2009 5/11/2009 5/18/2009 5/25/2009 6/1/2009 6/8/2009 6/15/2009 6/22/2009 6/29/2009 7/6/2009 7/13/2009 7/20/2009 7/27/2009 8/3/2009 8/10/2009 8/17/2009 8/24/2009 8/31/2009 9/7/2009 9/14/2009 9/21/2009 9/28/2009 10/5/2009 10/12/2009 10/19/2009 10/26/2009 11/2/2009 11/9/2009 11/16/2009 11/23/2009 11/30/2009 12/7/2009 12/14/2009 12/21/2009 12/28/2009 1/4/2010 1/11/2010 1/18/2010 1/25/2010 2/1/2010 2/8/2010 2/15/2010 2/22/2010 3/1/2010 3/8/2010 3/15/2010 3/22/2010 3/29/2010 4/5/2010 4/12/2010 4/19/2010 4/26/2010 5/3/2010 5/10/2010 5/17/2010 5/24/2010 5/31/2010 6/7/2010 6/14/2010 6/21/2010

www.mackieresearch.com

Source: CapitalIQ

8

Median EV/EBITDA

# companies

Multiple (x) 10.0x 15.0x 20.0x 25.0x 0.0x 5.0x

2022 2223 23 2222 2324 2322 2424 2626 26 2626 2526 2728 3129 33 3536 3842 3940 3840 4139 39 3942 4342 4143 4343 45 4347 4545 5151 5052 5253 51 5249 5251

Median Long-term average

EV/EBITDA multiples increase slightly but remain depressed below LT average

5/4/2009 5/11/2009 5/18/2009 5/25/2009 6/1/2009 6/8/2009 6/15/2009 6/22/2009 6/29/2009 7/6/2009 7/13/2009 7/20/2009 7/27/2009 8/3/2009 8/10/2009 8/17/2009 8/24/2009 8/31/2009 9/7/2009 9/14/2009 9/21/2009 9/28/2009 10/5/2009 10/12/2009 10/19/2009 10/26/2009 11/2/2009 11/9/2009 11/16/2009 11/23/2009 11/30/2009 12/7/2009 12/14/2009 12/21/2009 12/28/2009 1/4/2010 1/11/2010 1/18/2010 1/25/2010 2/1/2010 2/8/2010 2/15/2010 2/22/2010 3/1/2010 3/8/2010 3/15/2010 3/22/2010 3/29/2010 4/5/2010 4/12/2010 4/19/2010 4/26/2010 5/3/2010 5/10/2010 5/17/2010 5/24/2010 5/31/2010 6/7/2010 6/14/2010 6/21/2010

www.mackieresearch.com

Source: CapitalIQ

9

Median P/E

# companies

Multiple (x) 10.0x 15.0x 20.0x 25.0x 30.0x 35.0x 0.0x 5.0x

1919 1818 19 1919 1920 1918 1919 1920 21 2424 2525 2627 2727 31 3233 3133 3335 3538 3939 39 3941 4142 4040 4038 37 3834 3332 3535 3535 3535 35 3531 3433

Median Long-term average

P/E multiples increase but also are below LT average

5/4/2009 5/11/2009 5/18/2009 5/25/2009 6/1/2009 6/8/2009 6/15/2009 6/22/2009 6/29/2009 7/6/2009 7/13/2009 7/20/2009 7/27/2009 8/3/2009 8/10/2009 8/17/2009 8/24/2009 8/31/2009 9/7/2009 9/14/2009 9/21/2009 9/28/2009 10/5/2009 10/12/2009 10/19/2009 10/26/2009 11/2/2009 11/9/2009 11/16/2009 11/23/2009 11/30/2009 12/7/2009 12/14/2009 12/21/2009 12/28/2009 1/4/2010 1/11/2010 1/18/2010 1/25/2010 2/1/2010 2/8/2010 2/15/2010 2/22/2010 3/1/2010 3/8/2010 3/15/2010 3/22/2010 3/29/2010 4/5/2010 4/12/2010 4/19/2010 4/26/2010 5/3/2010 5/10/2010 5/17/2010 5/24/2010 5/31/2010 6/7/2010 6/14/2010 6/21/2010

www.mackieresearch.com

10
10.0 15.0 20.0 25.0 30.0 5.0

Average EV/Revenue – by Sector

# Companies 1

26.5

Virtual World 10.1 Infrastructure 9.7 Learning 5.7 Social Networking 4.8 Music 4.7 Vertical Communities 4.2 Search 4.0 Gaming 3.7 Diversified 3.6 Mobile SMS/Voice Marketing Podcasting Media Collaboration

2 1 8 2 1 1 21 6 4 3 6 1 9 1 3 2 3 1 2 1 Advertising Internet Retail Enterprise Video Dating Financial Services 1.3 0.4 3.5 3.1 2.8 2.6 2.5 2.3 2.0 1.8 1.8

www.mackieresearch.com

Average EV/EBITDA – by Sector
50.0 45.0 45.0 40.0 35.0 30.0 25.0 20.0 15.0 11.7 10.0 5.0 Diversified Internet Retail Social Networking Advertising Search Gaming Collaboration Enterprise Media Mobile Dating 1 11.6 11.5 11.2 9.8 9.5 9.0 7.4

17.6 15.8

# Companies

1

2

2

5

2

14

6

1

6

1

11

www.mackieresearch.com

Average P/E – by Sector
100.0 91.3 90.0

80.0

70.0

60.0 54.2 50.0 39.3

40.0

29.7 30.0 25.8 19.9 20.0 15.3 14.3 13.3

10.0

Internet Retail 2
# Companies

Enterprise 3

Collaboration 1

Marketing 6

Social Networking 16

Diversified 8

Advertising 3

Media 10

Gaming 28

12

www.mackieresearch.com

Source: CapitalIQ
10.0 15.0 20.0 25.0 30.0 35.0 40.0

13

EV/Revenue Ranking

SocialGO PLC Worlds.com Inc. SpectrumDNA, Inc. Tencent Holdings Ltd. Beyond Commerce, Inc. MOKO.mobi Limited Paid Inc. Gree, Inc. GeoSentric Oyj Chinese Gamer International Lingo Media Corporation TransGaming, Inc. Dena Co. Ltd. Fluid Music Canada, Inc. DigitalPost Interactive, Inc. HUGHES Telematics, Inc. Accelerize New Media, Inc. WebMediaBrands Inc Changyou.com Limited SK Communications Co., Ltd. Taleo Corp. Mixi, Inc. Kingsoft Corporation Limited Frogster Interactive Pictures AG iseemedia Inc. Wizzard Software Corporation ePro Ltd. Open Text Corp. NEOWIZ Games Corporation Modern Times Group Mtg AB Sohu.com Inc. UOMO Media, Inc XING AG Velti Plc Unilava Corporation PNI Digital Media Inc. Score Media Inc. Shutterfly, Inc. ValueClick, Inc. Webzen Inc. GungHo Online Entertainment, Inc. Myriad Group AG NeuLion Incorporated Platforma Mediowa Point Group S.A. HanbitSoft, Inc. YD Online Corp. Spark Networks, Inc. Gamania Digital Entertainment Co., Ltd. Hutchison Telecommunications Hong Kong Holdings Ltd. infoGROUP, Inc. Oriented Media Group Berhad SNAP Interactive, Inc. OAO RBC Information Systems NetDragon WebSoft, Inc. CornerWorld Corporation Internet Group SA The New York Times Company IAC/InterActiveCorp. TheStreet.com, Inc. Ynk Korea Inc. AQ Interactive, Inc. Points International Ltd. Cyberplex Inc. CDC Corp. United Online, Inc. AOL, Inc. Uniserve Communications Corp. DADA SpA Northgate Technologies Limited Glu Mobile, Inc. GigaMedia Ltd. Actoz Soft Co., Ltd. Tree.Com, Inc. Openwave Systems Inc. GameOn Co Ltd. RealNetworks Inc. Jumbuck Entertainment Limited Asknet AG LookSmart, Ltd. Dolphin Digital Media, Inc.
37 27 19 16 13 13 13 11 11 10 10 9 8 7 7 6

0.0

5.0

SocialGo has highest revenue multiple at 37x

5 5 4 4 4 4 3 3 3 3 3 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 0 0 0 0 0 0 0 0 0

www.mackieresearch.com

Source: CapitalIQ
10.0 15.0 20.0 25.0 30.0 35.0 40.0 45.0 50.0 45.0 SK Communications Co., Ltd. 35.3 HanbitSoft, Inc. Tencent Holdings Ltd. Taleo Corp. Frogster Interactive Pictures AG Chinese Gamer International Gree, Inc. Myriad Group AG Modern Times Group Mtg AB Dena Co. Ltd. Mixi, Inc. Shutterfly, Inc. TheStreet.com, Inc. Openwave Systems Inc. Score Media Inc. YD Online Corp. AQ Interactive, Inc. IAC/InterActiveCorp. Cyberplex Inc. Platforma Mediowa Point Group S.A. Gamania Digital Entertainment Co., Ltd. Open Text Corp. GungHo Online Entertainment, Inc. NEOWIZ Games Corporation Velti Plc XING AG PNI Digital Media Inc. DADA SpA Kingsoft Corporation Limited Uniserve Communications Corp. Spark Networks, Inc. ValueClick, Inc. Changyou.com Limited CDC Corp. NetDragon WebSoft, Inc. infoGROUP, Inc. Hutchison Telecommunications Hong Kong Holdings Ltd. The New York Times Company Sohu.com Inc. United Online, Inc. Actoz Soft Co., Ltd. AOL, Inc. GameOn Co Ltd. Jumbuck Entertainment Limited 2.5 2.3 19.819.419.2 17.8 16.7 16.1 15.414.9 14.213.7 12.812.6 12.4 10.5 9.8 30.3 28.4

14

EV/EBITDA Ranking

0.0

5.0

SK Communications leads the group at 45.0x

9.3 9.0 9.0 8.7 8.4 8.3 8.3 8.2 8.1 7.9 7.4 7.4 7.1 7.0 6.8 6.7 6.7 5.6 5.6 5.3 3.8 1.3 0.6

Excluding EV/EBITDA > 100x
www.mackieresearch.com

Source: CapitalIQ
100.0 10.0 20.0 30.0 40.0 50.0 60.0 70.0 80.0 90.0 0.0 91.3 Shutterfly, Inc. 57.2 Points International Ltd. 51.2 CDC Corp. Mixi, Inc. infoGROUP, Inc. Tencent Holdings Ltd. Open Text Corp. 37.4 Gree, Inc. 35.0 Dena Co. Ltd. Gamania Digital Entertainment Co., Ltd. NetDragon WebSoft, Inc. Chinese Gamer International Velti Plc Frogster Interactive Pictures AG NEOWIZ Games Corporation Hutchison Telecommunications Hong Kong Holdings Ltd. The New York Times Company ValueClick, Inc. Cyberplex Inc. Sohu.com Inc. Kingsoft Corporation Limited DADA SpA AOL, Inc. Changyou.com Limited GameOn Co Ltd. United Online, Inc. 5.5 Uniserve Communications Corp. Jumbuck Entertainment Limited Netease.com Inc. Giant Interactive Group, Inc. Shanda Interactive Entertainment Ltd. Perfect World Co., Ltd. 26.0 25.9 32.5 30.9 40.5 39.3 47.7 47.0

15

P/E Ranking

Shutterfly has the highest P/E at 91.3x

22.7 19.6 17.5 17.0 16.3 15.3 14.2 13.4 12.5 11.8 10.2 9.9 9.1 3.5 2.3 2.1 1.9 1.2

www.mackieresearch.com

Source: CapitalIQ

16

Total Market Capitalization

# companies (US$m) 100,000 10,000 20,000 30,000 40,000 50,000 60,000 70,000 80,000 90,000 6/29/2009 7/6/2009 7/13/2009 7/20/2009 7/27/2009 8/3/2009 8/10/2009 8/17/2009 8/24/2009 8/31/2009 9/7/2009 9/14/2009 9/21/2009 9/28/2009 10/5/2009 10/12/2009 10/19/2009 10/26/2009 11/2/2009 11/9/2009 11/16/2009 11/23/2009 11/30/2009 12/7/2009 12/14/2009 12/21/2009 12/28/2009 1/4/2010 1/11/2010 1/18/2010 1/25/2010 2/1/2010 2/8/2010 2/15/2010 2/22/2010 3/1/2010 3/8/2010 3/15/2010 3/22/2010 3/29/2010 4/5/2010 4/12/2010 4/19/2010 4/26/2010 5/3/2010 5/10/2010 5/17/2010 5/24/2010 5/31/2010 6/7/2010 6/14/2010 6/21/2010

Total market cap increases to $78 bn

98 98 98 98 98 98 98 98 98 98 97 98 98 98 98 99 99 99 99 99 99 99100 100100 100100 100100 100100 100 100100 101101 101101 101 101101 101101 101 101101 101101 101101 101 101

www.mackieresearch.com

17
# Companies

10,000.0

15,000.0

20,000.0

25,000.0

30,000.0

35,000.0

40,000.0

5,000.0

Total Market Cap – by Sector

8 28 Gaming Media Social Networking Collaboration Marketing Enterprise Search Internet Retail Mobile Music SMS/Voice Advertising Dating Financial Services Video 1 2 1 1 1 3 1 Virtual World Vertical Communities Payment Learning Infrastructure 10 16 1 6 3 1 2 5 2 3 3 2 1 Podcasting

Diversified

Eight Diversified companies totaling $35 bn in market cap

www.mackieresearch.com

Source: CapitalIQ
1,000 2,000 3,000 4,000 5,000 6,000

18

Market Cap Ranking

Tencent Holdings Ltd. Dena Co. Ltd. Netease.com Inc. Modern Times Group Mtg AB Gree, Inc. IAC/InterActiveCorp. AOL, Inc. Shanda Interactive Entertainment Ltd. Open Text Corp. Sohu.com Inc. Giant Interactive Group, Inc. Changyou.com Limited The New York Times Company Perfect World Co., Ltd. Hutchison Telecommunications Hong Kong Holdings Taleo Corp. ValueClick, Inc. Chinese Gamer International NEOWIZ Games Corporation SK Communications Co., Ltd. Mixi, Inc. Shutterfly, Inc. Kingsoft Corporation Limited United Online, Inc. RealNetworks Inc. infoGROUP, Inc. Gamania Digital Entertainment Co., Ltd. GungHo Online Entertainment, Inc. CDC Corp. Velti Plc NetDragon WebSoft, Inc. Myriad Group AG XING AG Openwave Systems Inc. Fluid Music Canada, Inc. OAO RBC Information Systems GigaMedia Ltd. Webzen Inc. The9 Limited HUGHES Telematics, Inc. Actoz Soft Co., Ltd. TheStreet.com, Inc. Points International Ltd. AQ Interactive, Inc. HanbitSoft, Inc. Cyberplex Inc. GameOn Co Ltd. Tree.Com, Inc. DADA SpA Spark Networks, Inc. Paid Inc. Score Media Inc. YD Online Corp. Frogster Interactive Pictures AG NeuLion Incorporated Ngi Group Inc. PNI Digital Media Inc. Moggle, Inc Quepasa Corp. Platforma Mediowa Point Group S.A. Gravity Co., Ltd TransGaming, Inc. Glu Mobile, Inc. WebMediaBrands Inc DigitalTown, Inc. ePro Ltd. Multiplied Media Corporation Socialwise, Inc. LookSmart, Ltd. GeoSentric Oyj Asknet AG NeXplore Corporation Ynk Korea Inc. VOIS, Inc. Accelerize New Media, Inc. Lingo Media Corporation YouBlast Global, Inc. Wizzard Software Corporation Dolphin Digital Media, Inc. Northgate Technologies Limited Unilava Corporation Jumbuck Entertainment Limited iseemedia Inc. Internet Group SA Beyond Commerce, Inc. SocialGO PLC MOKO.mobi Limited Kent International Holdings Inc. DigitalPost Interactive, Inc. IAS Energy, Inc. Kiwibox.Com, Inc. SNAP Interactive, Inc. En2Go International, Inc. Worlds.com Inc. SpectrumDNA, Inc. Oriented Media Group Berhad Uniserve Communications Corp. CornerWorld Corporation BroadWebAsia Inc. UOMO Media, Inc Mobile Data Corp.

0

Tencent’s $31 bn market cap dominates group

www.mackieresearch.com

Price Performance – 1 Week
• Positive price momentum, with 52% of stocks rising over the past week.
Price Momentum

Flat 9%

Rising 52%

Falling 39%

19

www.mackieresearch.com

Average Price Performance – 1 Week, by Sector
15.0% 13.3% 10.0% 5.0% 0.0% -5.0% -10.0% -15.0% -15.3% -16.2% -20.0% -1.9% -2.7% -3.2% -3.6% 11.7% 7.7% 5.9% 4.2% 3.3%

Video sector shows highest weekly returns
1.8% 1.7% 0.9% 0.3% 0.1% 0.0%

-4.8% -5.6% -7.6% -9.9%

Internet Retail

Collaboration

Financial Services Vertical Communities

Virtual World

Source: CapitalIQ
20 www.mackieresearch.com

Infrastructure

Social Networking

Payment

Advertising

Learning

Search

Diversified

SMS/Voice

Podcasting

Enterprise

Marketing

Gaming

Mobile

Dating

Media

Video

Music

Source: CapitalIQ
20.0% 40.0% 60.0% 0.0%

21

Price Performance – 1 Week

-60.0%

-40.0%

-20.0%

BWBA GEO1V MBYL UOMO WDDD STVI SPXA GLUU DPDM VOIS OMEDIA IEE TSXV:USS TSX:FMN ACLZ TSXV:LM GIGM WSE:PGM WZE WSE:IGR UNTD DGTW OTEX NXPC TSXV:PN TSE:2432 O1BC DGLP TSCM 700 QPSA KOSE:A069 A052770 GRVY SNDA 590057 PWRD A095660 CYOU ASX:JMB MKB NCTY DB:M0C PAYD ETGI WEBM TSXV:TNG CWRL 3838 VEL TREE IUSA GTSM:3083 IACI XTRA:A5A YBLT LOV A023770 MTG B GA 2121 SOHU 2497 RBCI SEHK:215 SFLY MYRN A066270 6180 3888 SEHK:8086 OPWV 3812 TLEO SCLW CHIN.A TSX:SCR VCLK 777 HUTC LOOK A047080 3765 NTES CM:DA KNTH TSX:CX AIM:SGO FRG AOL NYT KIWB RNWK TSX:NLN TSE:3632 TSX:PTS TSXV:MMC A052790 UNLA BYOC IASC.A

www.mackieresearch.com

Source: CapitalIQ
160% 140% 120% 100% 80% 60% 40% 20% 0%
1000% 1500% 2000% 2500% 3000% 500% 0%

22
OAO RBC Information Systems

YouBlast Global, Inc.

ePro Ltd.

Beyond Commerce, Inc.

Beyond Commerce, Inc.

Gree, Inc.

AQ Interactive, Inc.

Actoz Soft Co., Ltd.

Uniserve Communications Corp. 6 Month

1 Month

HanbitSoft, Inc.

Velti Plc

SK Communications Co., Ltd. AQ Interactive, Inc.

SNAP Interactive, Inc.

Score Media Inc.

Cyberplex Inc.

SK Communications Co., Ltd.

Points International Ltd.

Price Performance (Top 10)

Quepasa Corp.

DADA SpA

100%

150%

200%

250%

50% 0%

500%

1000%

1500%

2000%

2500%

3000%

3500%

4000%

0%

OAO RBC Information Systems Quepasa Corp.

Beyond Commerce, Inc.

ePro Ltd.

ePro Ltd.

YouBlast Global, Inc.

Velti Plc

SK Communications Co., Ltd.

3 Month

1 Year

Dena Co. Ltd.

Velti Plc

Fluid Music Canada, Inc. TransGaming, Inc.

Points International Ltd. Hutchison Telecommunications Hong Kong Holdings Ltd.

Frogster Interactive Pictures AG Modern Times Group Mtg AB

Gree, Inc.

LookSmart, Ltd.

www.mackieresearch.com

Gree, Inc.

Glu Mobile, Inc.

Source: CapitalIQ
-60.0% -50.0% -40.0% -30.0% -20.0% -10.0% 0.0%

23
-50.0% -60.0% -70.0% -80.0% -90.0% -100.0% 0.0% -10.0% -20.0% -30.0% -40.0%
VOIS, Inc.

Kiwibox.Com, Inc.

Mobile Data Corp.

Dolphin Digital Media, Inc.

MOKO.mobi Limited
Glu Mobile, Inc.

GeoSentric Oyj

SpectrumDNA, Inc.

1 Week

6 Month
SNAP Interactive, Inc.

SpectrumDNA, Inc.

En2Go International, Inc.
Worlds.com Inc.

UOMO Media, Inc

UOMO Media, Inc

Unilava Corporation

Mobile Data Corp.

CornerWorld Corporation

GeoSentric Oyj

BroadWebAsia Inc.

BroadWebAsia Inc.

0.0%

Price Performance (Bottom 10)

-70.0%

-60.0%

-50.0%

-40.0%

-30.0%

-20.0%

-10.0%

-120.0% -80.0% -60.0% Cyberplex Inc. Dolphin Digital Media, Inc. Moggle, Inc SpectrumDNA, Inc. Beyond Commerce, Inc. CornerWorld Corporation YouBlast Global, Inc. UOMO Media, Inc En2Go International, Inc. BroadWebAsia Inc.

-100.0%

-40.0%

-20.0%

0.0%
Paid Inc. SNAP Interactive, Inc. Lingo Media Corporation VOIS, Inc.

1 Month

1 Year

GeoSentric Oyj

Mobile Data Corp.

SpectrumDNA, Inc.

BroadWebAsia Inc.

CornerWorld Corporation

www.mackieresearch.com

Unilava Corporation

Capital Market Activity (Financing, M&A)

24

www.mackieresearch.com

Financing Activity – Current Month
Company Name Zynga Invite Media FetchBack HauteLook Challenge Games Mytopia Marin Software Apptera BookRenter RockYou Machinima.com SafetyWeb Transpera Kudzu Interactive Curse Adisn Connotate Bebo BigDoor Media BeachMint Metacafe SponsorPay LucidMedia Magnetic Gogobot Giiv Attributor Trefis Metamarkets Snaptic WOWIO uCirrus Cellixis Dilithium Networks Schoology Thumbtack SoGeo Rummble TeamSnap Country USA USA USA USA USA Israel USA USA USA USA USA USA USA USA USA USA USA UK USA USA USA Germany USA USA USA USA USA USA USA USA USA USA USA USA USA USA Netherlands UK USA Sector Gaming Analytics Advertising Internet Retail Gaming Gaming Advertising Mobile Ad Social Commerce Widget Virtual World Social Networks Mobile Ad Financial Services Social Networks Advertising Analytics Social Networks Media Social Commerce Video Virtual Goods Advertising Advertising Travel Social Commerce Analytics Analytics Advertising Mobile Internet Retail Infrastructure Comment/Reputation Video Online Learning Crowdsourced Content Location-based SNS Location-based SNS Vertical Communities 70.0 40.0 31.0 20.5 18.0 11.2 10.0 10.0 10.0 9.0 8.0 7.0 7.0 6.0 5.5 5.3 5.0 5.0 5.0 5.0 4.6 4.5 4.0 4.0 3.4 3.2 3.2 2.5 2.3 1.7 1.7 1.5 1.5 1.3 1.2 0.8 0.8 159.0 6.0 1.5 0.7 50.1 17.0 47.0 175.9 10.0 11.8 Acquisition Angel/Seed Debt financing Series A Series B Series C Series D 147.0 Series E NA Grand Total 147.0 70.0 40.0 31.0 20.5 18.0 11.2 10.0 10.0 10.0 9.0 8.0 7.0 7.0 6.0 5.5 5.3 5.0 5.0 5.0 5.0 4.6 4.5 4.0 4.0 3.4 3.2 3.2 2.5 2.3 1.7 1.7 1.5 1.5 1.3 1.2 0.8 0.8 0.7 478.3

25

www.mackieresearch.com

AOL Takes Huge Loss on Bebo Sale
Estimated Value per Unique Visitor
Source: Company reports, Compete.com $600 $568

$500

$400

$370

AOL paid $850 mm for Bebo in Mar-08 or $38/unique visitor (UV) – at the “under $10 mm” price it sold Bebo for last week that equates to less than $1/UV

($)

$300 $200 $200 $125 $100 $113 $88 $67 $48 $42 $40 $40 $38 $32 $29 $29 $25 $20 $16 PageOnce People Media Twitter Yelp $15 MMC (Poynt)

$7 Urbanspoon

$7 Playfish

$6 Zynga

$5 Ustream

$5 StumbleUpon

$2 Rockyou

$2 FriendsReunited

$1 $0.79 Friendster Bebo

$Mint.com FriendFeed Foursquare (rumoured YHOO offer) Club Penguin Foursquare Foursquare Facebook Linkedin Plaxo Booya Gowalla Blippy Twitter Bebo

Dec- Apr- May- Apr- Sep- Oct- Mar- Aug- Sep- Sep- May- Mar- May- Aug- Feb- Feb09 10 08 10 09 08 10 09 09 09 10 08 09 07 09 08

Jul- Dec- May- Feb- Nov- Dec- Feb- May- Nov- Aug- Dec- Jun09 09 10 09 09 09 10 09 09 09 09 10

26

www.mackieresearch.com

Financing Activity – Current Month, by Sector
$ Raised # Deals

Social Networks Internet Retail 4% 7%

Other 19%

Internet Retail 5%

Social Networks 8%

Advertising 14%

Advertising 14%

Other 52%

Analytics 17% Gaming 39%

Analytics 13%

Gaming 8%

27

www.mackieresearch.com

Financing Activity
1000.0 900.0 800.0 700.0 9.6 600.0 (US$m) 500.0 6.4 400.0 300.0 200.0 100.0 0.0
Jun-09 Jul-09 Aug-09 Sep-09 Oct-09 Nov-09 Dec-09 Jan-10 Feb-10 Mar-10 Apr-10 May-10 Jun-10

June financing above ~US$265 mm monthly total deal value average
14.1

16.0

14.0 12.2 12.0 10.3 8.9 7.8 6.4 5.8 5.6 6.0 9.4 10.0 (US$m)

8.0

5.4 4.6

4.0

2.0

0.0

*Dec-09 includes $180m Zynga investment Apr-10 includes $300m DST investment Jun-10 includes $147m Zynga investment

Total

Average per Deal

LTM Total Average**

**Excludes Dec-09, Apr10

28

www.mackieresearch.com

29

(US$m) 50.0 100.0 150.0 200.0 250.0 300.0 350.0 400.0 450.0 500.0 0.0

# companies

Capital Market Activity Ranking – by Sector, last three months

13 Gaming Diversified Collaboration Mobile Media 1 5 9

Gaming the biggest area of interest in the past quarter

8 9 3 16 Advertising Analytics Video Internet Retail Social Networks Financial Services Virtual World Widget Enterprise Vertical Communities Mobile Ad Infrastructure Mobile Payment Virtual Goods 2 2 2 1 3 4 1 1 4 1 1 1 1 Online Learning Music Aggregation Search Travel Classified Publishing Location-based SNS Microblog Micromedia Blog Comment/Reputation
www.mackieresearch.com

Social Commerce Crowdsourced Content

14 8 5 10 5 5 2 4 9 3 5 1

30
(US$ mm) 100.0 200.0 300.0 400.0 500.0 600.0 700.0 0.0 Jan-08 Feb-08 Mar-08 Apr-08 May-08 Jun-08 Jul-08 Aug-08 Sep-08 Oct-08 Nov-08 Dec-08 Jan-09 Feb-09 Mar-09 Apr-09 May-09 Jun-09 Jul-09 Aug-09 Sep-09 Oct-09 Nov-09 Dec-09 Jan-10 Feb-10 Mar-10 Apr-10 May-10 Jun-10 Social Networks Gaming Advertising Video Virtual World (# Deals) 10 15 20 25 30 0 Jan-08 Feb-08 Mar-08 Apr-08 May-08 Jun-08 Jul-08 Aug-08 Sep-08 Oct-08 Nov-08 Dec-08 Jan-09 Advertising Gaming Virtual World Video Feb-09 Mar-09 Apr-09 May-09 Jun-09 Jul-09 Aug-09 Sep-09 Oct-09 Nov-09 Dec-09 Jan-10 Feb-10 Mar-10 Apr-10 May-10 Jun-10 Social Networks 5

Top 5 Sectors (2008-present)
$ Raised # Deals

Top 5 sectors average $170 mm & 15 deals per month (aggregate)

www.mackieresearch.com

Upcoming Events/Earnings
Company
Tree.Com, Inc. (NasdaqGM:TREE)

Date

Time

Quarter
Q2/10

Conf Call Details
877-874-1588

29-Jul-10 11:00 AM (EST)

Source: CapitalIQ
31 www.mackieresearch.com

Public Company Listing
Com pany Nam e Ticker
A ccelerize New M edia, Inc. ACLZ A cto z So ft Co ., Ltd. A052790 A OL, Inc. AOL A Q Interactive, Inc. 3838 A sknet AG XTRA :A 5A B eyo nd Co mmerce, Inc. BYOC B roadWebA sia Inc. BWB A CDC Co rp. CHIN.A Changyo u.co m Limited CYOU Chinese Gamer Internatio nal GTSM :3083 Co rnerWorld Co rpo ratio n CWRL Cyberplex Inc. TSX:CX DA DA SpA CM :DA Dena Co . Ltd. TSE:2432 DigitalPo st Interactive, Inc. DGLP DigitalTown, Inc. DGTW Do lphin Digital M edia, Inc. DP DM En2Go International, Inc. ETGI ePro Ltd. SEHK:8086 Fluid M usic Canada, Inc. TSX:FM N Fro gster Interactive P ictures A G FRG Gamania Digital Entertainment Co ., Ltd. 61 80 GameOn Co Ltd. 381 2 Geo Sentric Oyj GEO1 V Giant Interactive Gro up, Inc. GA GigaM edia Ltd. GIGM Glu M o bile, Inc. GLUU Gravity Co ., Ltd GRVY Gree, Inc. TSE:3632 GungHo Online Entertainment, Inc. 3765 HanbitSo ft, Inc. A047080 HUGHES Telematics, Inc. HUTC Hutchison Teleco mmunicatio ns Ho ng Kong Ho ldings Ltd. SEHK:21 5 IA C/InterActiveCo rp. IA CI IA S Energy, Inc. IA SC.A infoGROUP , Inc. IUSA Internet Gro up SA WSE:IGR

Trading Exchange Currency HQ
USD KRW USD JP Y EUR USD USD USD USD TWD USD CA D EUR JP Y USD USD USD USD HKD CA D EUR TWD JP Y EUR USD USD USD USD JP Y JP Y KRW USD HKD USD USD USD P LN United States So uth Ko rea United States Japan Germany United States United States Ho ng Ko ng China Taiwan United States Canada Italy Japan United States United States United States United States Ho ng Ko ng United States Germany Taiwan Japan Finland China Taiwan United States So uth Ko rea Japan Japan So uth Ko rea United States Ho ng Ko ng United States Canada United States P o land

Current Price
0 1 2,350 23 1 00 45,1 3 0 0 2 29 285 0 1 4 2,794 0 1 0 0 1 2 1 9 55 80,1 00 0 7 2 1 2 7,550 203,400 4,570 3 2 24 0 8 1

US$ Market Cap (m m ) Em ployees
1 5.0 93.4 2,452.4 86.6 20.2 7.9 1 .7 255.9 1 ,493.9 770.8 1 .9 85.0 76.1 4,368.7 6.6 35.7 1 2.4 4.8 35.1 1 79.9 60.8 275.7 84.9 22.3 1 ,653.9 1 22.9 38.3 46.0 3,745.2 255.9 85.3 1 00.1 1 ,053.6 2,606.9 5.6 459.7 8.4 1 0 NA 6,700 NA NA 1 6 46 NA 1 ,308 NA 1 6 NA 597 NA 6 3 NA NA 707 NA NA NA NA 1 20 NA NA 479 NA NA NA NA 276 1 ,732 3,200 NA 3,1 46 NA

OTCBB KOSE NYSE TSE XTRA OTCBB OTCPK NasdaqGS NasdaqGS GTSM OTCBB TSX CM TSE OTCBB OTCBB OTCBB OTCBB SEHK TSX XTRA GTSM TSE HLSE NYSE NasdaqGS NasdaqGM NasdaqGM TSE OSE KOSE OTCBB SEHK NasdaqGS OTCPK NasdaqGS WSE

32

www.mackieresearch.com

Public Company Listing cont.
Com pany Nam e
Jumbuck Entertainment Limited Kent Internatio nal Ho ldings Inc. Kingso ft Co rpo ratio n Limited Kiwibo x.Co m, Inc. Lingo M edia Co rpo ratio n Lo o kSmart, Ltd. M ixi, Inc. M o bile Data Co rp. M o dern Times Gro up M tg A B M o ggle, Inc M OKO.mo bi Limited M ultiplied M edia Co rpo ratio n M yriad Gro up A G NEOWIZ Games Co rpo ratio n NetDrago n WebSo ft, Inc. Netease.co m Inc. NeuLio n Inco rpo rated NeXplo re Co rpo ratio n Ngi Gro up Inc. No rthgate Techno lo gies Limited OA O RB C Info rmatio n Systems Open Text Co rp. Openwave Systems Inc. Oriented M edia Gro up B erhad P aid Inc. P erfect Wo rld Co ., Ltd. P latfo rma M edio wa P o int Gro up S.A . P NI Digital M edia Inc. P o ints Internatio nal Ltd. Quepasa Co rp. RealNetwo rks Inc. Sco re M edia Inc. Shanda Interactive Entertainment Ltd. Shutterfly, Inc. SK Co mmunicatio ns Co ., Ltd.

Ticker
A SX:JM B KNTH 3888 KIWB TSXV:LM LOOK 21 21 M B YL M TG B DB :M 0C M KB TSXV:M M C M YRN A 095660 777 NTES TSX:NLN NXP C 2497 590057 RB CI OTEX OP WV OM EDIA P A YD P WRD WSE:P GM TSXV:P N TSX:P TS QP SA RNWK TSX:SCR SNDA SFLY A 066270

Trading Exchange Currency HQ
A SX OTCP K SEHK OTCB B TSXV NasdaqGM TSE OTCB B OM DB A SX TSXV SWX KOSE SEHK NasdaqGS TSX OTCP K TSE B SE M ICEX NasdaqGS NasdaqGS KLSE OTCB B NasdaqGS WSE TSXV TSX OTCB B NasdaqGS TSX NasdaqGS NasdaqGS KOSE A UD USD HKD USD CA D USD JP Y USD SEK EUR A UD CA D CHF KRW HKD USD CA D USD JP Y INR RUB USD USD M YR USD USD P LN CA D CA D USD USD CA D USD USD KRW A ustralia United States China United States Canada United States Japan United States Sweden United States A ustralia Canada Switzerland So uth Ko rea China China Canada United States Japan India Russia Canada United States M alaysia United States China P o land Canada Canada United States United States Canada China United States So uth Ko rea

Current Price
0.20 1 .95 4.34 0.01 0.51 1 .37 402,000.00 0.05 452.80 0.85 0.07 0.1 4 4.49 42,1 00.00 3.49 33.33 0.51 0.36 38,500.00 1 6.00 38.69 38.75 2.1 5 0.09 0.26 25.1 6 1 .45 1 .56 0.62 3.68 3.61 0.87 40.37 24.78 20,500.00

US$ Market Cap (m m ) Em ployees
8.6 6.9 609.3 5.0 1 4.6 23.5 681 .6 1 .2 3,887.4 49.2 7.3 34.4 1 96.9 756.8 236.4 4,31 6.9 58.4 20.1 52.4 1 2.2 1 69.9 2,200.2 1 80.3 3.6 70.5 1 ,259.5 46.2 51 .9 91 .1 47.7 488.3 69.3 2,397.1 665.5 737.8 79 NA 2,735 6 NA 65 NA NA 2,936 2 NA NA NA NA 2,901 NA 224 NA NA 1 60 2,523 3,700 590 NA 20 NA NA NA 93 71 1 ,754 230 5,721 51 9 NA

33

www.mackieresearch.com

Public Company Listing cont.
Com pany Nam e
So cialGO P LC So cialwise, Inc. So hu.co m Inc. Spark Networks, Inc. SpectrumDNA , Inc. Taleo Co rp. Tencent Holdings Ltd. The New Yo rk Times Co mpany The9 Limited TheStreet.co m, Inc. TransGaming, Inc. Tree.Com, Inc. Unilava Co rpo ratio n Uniserve Communications Co rp. United Online, Inc. UOM O M edia, Inc ValueClick, Inc. Velti P lc VOIS, Inc. WebM ediaB rands Inc Webzen Inc. Wizzard So ftware Corpo ratio n Wo rlds.co m Inc. XING A G YD Online Co rp. Ynk Ko rea Inc. Yo uB last Glo bal, Inc.

Ticker
A IM :SGO SCLW SOHU LOV SP XA TLEO 700 NYT NCTY TSCM TSXV:TNG TREE UNLA TSXV:USS UNTD UOM O VCLK VEL VOIS WEB M KOSE:A 069080 WZE WDDD O1 C B A 052770 A 023770 YB LT

Trading Exchange Currency HQ
A IM OTCB B NasdaqGS A M EX OTCB B NasdaqGM SEHK NYSE NasdaqGS NasdaqGM TSXV NasdaqGM OTCB B TSXV NasdaqGS OTCB B NasdaqGS A IM OTCB B NasdaqGS KOSE A M EX OTCB B XTRA KOSE KOSE OTCB B GB P USD USD USD USD USD HKD USD USD USD CA D USD USD CA D USD USD USD GB P USD USD KRW USD USD EUR KRW KRW USD United Kingdom United States China United States United States United States China United States China United States Canada United States United States Canada United States Canada United States United Kingdom United States United States So uth Ko rea United States United States Germany So uth Ko rea So uth Ko rea United States

Current Price
0.01 0.50 44.54 3.55 0.06 25.60 1 28.90 1 3 0.1 4.07 2.91 0.67 6.88 0.1 1 0.1 2 6.36 0.02 1 2.05 4.51 0.01 1 .00 1 ,700.00 1 0.20 0.07 28.35 4,790.00 2,930.00 0.40

US$ Market Cap (m m ) Em ployees
7.6 25.0 1 ,684.4 73.1 3.8 1 7.9 ,01 30,367.3 1 ,474.9 1 03.8 91 .8 39.1 77.1 1 0.9 3.4 554.2 1 .6 980.0 250.6 1 8.0 37.4 1 8.2 1 1 3.2 4.0 1 .2 81 61 .3 1 9.9 1 3.8 9 NA 3,997 1 55 8 91 6 7,845 7,665 1 0 ,01 274 28 700 40 NA 1 ,699 NA 1 ,086 459 2 83 326 80 1 293 NA NA 6

34

www.mackieresearch.com

Disclaimer
RELEVANT DISCLOSURES APPLICABLE TO: NONE 1. None applicable. ANALYST CERTIFICATION Each analyst of Mackie 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.

This report has been created by Analysts that are employed by Mackie Research Capital Corporation, a Canadian Investment Dealer. For further disclosures, please see last page of this report. Information about Mackie Research Capital Corporation’s Rating System, the distribution of our research to clients and the percentage of recommendations which are in each of our rating categories is available on our web site at www.mackieresearch.com. The information contained in this report has been drawn from sources believed to be reliable but its accuracy or completeness is not guaranteed, nor in providing it does Mackie Research Capital Corporation assume any responsibility or liability. Mackie Research Capital Corporation, its directors, officers and other employees may, from time to time, have positions in the securities mentioned herein. Contents of this report cannot be reproduced in whole or in part without the expressed permission of Mackie Research Capital Corporation. (U.S. Institutional Clients — Research Capital U.S.A. Inc. (a wholly owned subsidiary of Mackie Research Capital Corporation) accepts responsibility for the contents of this report subject to the terms & limitations set out above. Firms or institutions receiving this report should effect transactions in securities discussed in the report through Research Capital U.S.A. Inc., a Broker-Dealer Registered with the United States Securities and Exchange Commission). Toronto 416.860.7600 Montreal 514.399.1500 Vancouver 604.662.1800 Calgary 403.218.6375 Regina 306.566.7550 St. Albert 780-460-6460

35

www.mackieresearch.com

You're Reading a Free Preview

Download
scribd
/*********** DO NOT ALTER ANYTHING BELOW THIS LINE ! ************/ var s_code=s.t();if(s_code)document.write(s_code)//-->