10-01-05 web 2.0 weekly - special edition (2009: year in review)

8/14/2019 10-01-05 Web 2.0 Weekly - Special Edition (2009: Year in Review)

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David Shore, CFA, [email protected]

Damian Wojcichowsky, Associate416.860.7652

[email protected]

5 J a n u a r y 2 0

Web 2.0 Weekly SPECIAL EDITIO

2009 Review: A Strong Year for Web

SOFTWARE AND ME


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O P F I VE D EA LS O F 2009

The Top Five: Despite over 400 transactions in 2009, it wasnt hard choosing our Top Five transactions for 2009 (witt le bit of massaging). Our Top Five transactions are: Facebooks $200 mill ion D round, Twitters $100 mill ion E round,2.25 bil l ion acquisit ion of Skype, the almost $1 bil l ion in f inancing/M&A for Social Gaming companies (including Zy

Playdom and Playfish), and the incredible per unique visitor value ascribed in the financing for location-based soetworking company Gowalla.

Facebook raises $200 million D round: In May 2009, Facebook announced a new financing round raising $mill ion from Digital Sky Technologies. The transaction gave Digital Sky a 1.96% stake, valuing Facebook at bil l ion. This f inancing brought the companys total to $678.2 mill ion. This was also the largest f inancingrecorded in 2009.

Twitter raises $100 million E round: The third largest f inancing round in 2009 belonged to Twitter a $mill ion Series E in September 2009. The financing reportedly valued Twitter at $1 bil l ion a remarkable valuafor a company that has not yet formalized a revenue model! More recently, it has been reported that Twitter actually profitable in 2009 due to the $25 mill ion in sear ch deals it signed in October with Google and Microsoft

Skype is acquired for $2.025 billion: By far the largest overall transaction in our database in 2009 was acquisit ion of a majority posit ion (65%) in Skype from eBay for $2.025 bil l ion announced in September 2009. transaction was completed in November 2009. eBay had purchased Skype for $4.0 bil l ion in 2005.

Social Gaming financing activity reaches ~$1 billion (Zynga, Playfish, Playdom, etc.): Perhaps the hosector overall in 2009 was Social Gaming. This segment of the Web 2.0 market had the third highest numbedeals (39) and generated almost $1 bil l ion in f inancing/M&A activity the second highest total overall (FigureThree transactions in particular stand out in the social gaming space the $400 mill ion acquisit ion of PlayfishElectronic Arts, November 2009), the $180 mill ion financing of Zynga (Series C, December 2009, by Digital Sand the $43 mill ion first round of f inancing for Playdom (New Enterprise lead, November 2009, Series A). Thhas been much speculation as to how the larger social gaming companies will proceed , with potential IPO or furstrategic M&A most l ikely.

Financing/M&A (2009)

By Sector/Type

0

500

1,000

1,500

2,000

2,500

SMS/Voice

Gaming

SocialNetworks

Video

Advertising

VerticalCommunities

Microblog

Infrastructure

VirtualWorld

Mobile

Music

Media

OnlineDating

Widget

Collaboration

Comment/Reputation

Search

SocialCommerce

CrowdsourcedContent

MobileAd

Enterprise

Aggregation

Analytics

Blog

VirtualGoods

OnlineLearning

FinancialServices

Wiki

Documents

Advertising/Mobile

Travel

MobilePayment

Micromedia

Classified

RSS

Location-basedSNS

Publishing

VisualCommerce

InternetRetail

SAS

OnlineCalendar

(US$mm)

S eries E

S eries D

S eries C

S eries B

S eries A

P I P E

Debt financing

Angel/S eed

Acquisition

gure 1. Capital Market Activity, 2009, By Sectorource. Company reports


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Hottest new sector? Location-based social networks (Foursquare, Gowalla, etc.). Unique visitor vaskyrockets: Financing activity for location-based social networks really heated up late in 2009. While the tf inancing raised in 2009 was quite small (~$15 mill ion), the hype surrounding location-based SNS companies substantial. In our opinion, this was highlighted by the $8.4 mill ion December Series B financing for Gowalla. reported valuation of $28.4 mill ion implies a value of $ 568 for each of its 50,000 users (Figure 2). That comparea $40 per user value we estimate for the Foursquare financing in September.

Estimated Value per Unique Visitor

$568

$200

$113

$88

$48 $42 $40$32 $29 $29 $25 $22 $20 $19 $19 $16

$7 $6 $5 $2

$-

$100

$200

$300

$400

$500

$600

Gowalla

Plaxo

Mint.com

Linkedin

FriendFeed

Twitter

Foursquare

Facebook

ClubPenguin

Twitter

Yelp

Bebo

PeopleMedia

Yelp

MMC(Poynt)

PageOnce

Playfish

Zynga

StumbleUpon

FriendsReunited

D e c- 0 9 M a y- 0 8 S e p -0 9 O c t- 0 8 A u g- 0 9 S e p -0 9 S e p- 0 9 M a y- 0 9 A ug -0 7 F e b -0 9 F e b -0 8 M a r- 08 J u l- 09 D e c- 0 9 D e c- 0 9 D e c- 0 9 N ov - 09 D e c- 0 9 M a y- 0 9 A ug -0 9

($)

Source: C ompany report s , C ompete. com

gure 2. Unique Visitor Valueource. Company reports, RCC estimates, Compete.com


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009 F I N A N C I N G R EVI EW

December the year ends on a high note: Total transaction value in the Web 2.0 universe for December is $44mill ion (Figure 3). The number of f inancings stands at 34, averaging $13.2 mill ion each. In comparison, total capital ran November was $204.4 mill ion, averaging $10.8 mill ion (19 deals); October was $176 .1 mill ion, averaging $5.9 mill ioneals); and September was $232.8 mill ion, averaging $9.0 mill ion (26 deals) .

Financing Activity Last Twelve Months

7.0 6.96.5

6.2

14.2

4.7

5.6

7.4

9.0

5.9

10.8

13.2

6.4

0.0

50.0

100.0

150.0

200.0

250.0

300.0

350.0

400.0

450.0

500.0

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

(US$m)

0.0

2.0

4.0

6.0

8.0

10.0

12.0

14.0

16.0

(US$m)

Tota l Average*May-09 includes $200m FB investment

Dec-09 includes $180m Zynga investment

gure 3. Financings, Last Twelve Monthsource. Company reports


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September was biggest month: September was the biggest month for capital market activity, driven by the acquisit ioSkype for $2.025 bil l ion (Figure 4). After a slow October, f inancing/M&A activity picked up in the last two months of

ear, with December being the largest month for f inancing (excl uding M&A).

Total Capital Market Activity - Las t Twelve Months

-

500

1,000

1,500

2,000

2,500

3,000

D e c-08 Jan -0 9 F e b-0 9 M ar-09 Apr -0 9 M ay-0 9 Ju n-09 Ju l-09 Aug-0 9 S e p-09 O c t-09 N ov-0 9 D e c-09

S eries E

S eries D

S eries C

S eries B

S eries A

P IP E

Debt financing

Angel/S eed

Acquisition

gure 4. Capital Market Activity, by Sector, Last Twelve Monthsource. Company reports

10 billion cumulative: With $2.8 bil l ion in f inancing in 2009, total f inancing for our Web 2.0 universe is now $9.7 bi

Figure 5). The $2.8 bil l ion raised in 2009 was down 17.2% from the $3.4 bil l ion raised in 2008.

Web 2.0 F inancing (cumulative)

41.5 24.7

112.859.4 40.1 59.7 43.3

95.9

173.5182.1163.8

240.5262.9

338.7

492.4

1,067.3

950.4

1,431.6

623.0

426.3

658.0713.7

662.0

830.0

-

200.0

400.0

600.0

800.0

1,000.0

1,200.0

1,400.0

1,600.0

Q 1 Q2 Q 3 Q 4 Q 1 Q 2 Q 3 Q 4 Q 1 Q 2 Q 3 Q 4 Q 1 Q 2 Q 3 Q 4 Q 1 Q 2 Q 3 Q 4 Q 1 Q 2 Q 3 Q 4

2004 2005 2006 2007 2008 2009

(U

S$m)

-

2,000.0

4,000.0

6,000.0

8,000.0

10,000.0

12,000.0

(U

S$m)

gure 5. Web 2.0 Financing, by Quarter, Cumulativeource. Company reports


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Smaller deal sizes : Deal size averages fell below long-term historical levels in 2009, with Series A-D rounds all beong-term average levels (Figure 6). However, angel rounds were signif icantly larger than historical levels, averaging $

mill ion in 2009, above the $2.6 mill ion long-term average.

Average financing round size

3.0 2.9

6.5

4.4

7.6

12.9

24.2

28.5

2.6

14.9

6.3 6.2

10.2

22.4

28.4 28.5

0.0

5.0

10.0

15.0

20.0

25.0

30.0

Angel/Seed Debt financing PIPE Series A Series B Series C Series D Series E

(US$m)

LTM Average Size Overall Average

gure 6. Average Financing Round Size, LTM and Overall Averageource. Company reports

Early rounds dominate: As Figures 7 and 8 show, early rounds (Angel/Series A) dominate our f inancing landscapeerms of number of deals with almost 50% of deals. Series C rounds raised the most overall (25.8% of dollars raised), head of Series B (25.2%).

Financing by Type - 2009

(# deals)

P I P E

1.6%

S eries A

28.1%

S eries B

26.2%

Debtfinancing

2.5%

S eries C

15.6%

S eries D

6.0%

S eries E

1 .4%

Angel/S eed

18.6%


(amount raised)

P I P E

1.4%

S eries A

15.8%

S eries B

25.5%

Debtfinancing

0.9%

S eries C

25.6%

S eries D

18.6%

S eries E

5 .0%

Angel/S eed

7.2%

gures 7 & 8. Capital Market Activity, by Type, Last Twelve Monthsource. Company reports


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Q4 largest for financing: Figures 9 and 10 show the financing activity by month and quarter for 2009, broken out by eatage (Angel/Series A), mid-stage (Series B&C), and late-stage (Series D, E, and PIPEs). Q4 was the largest quarteerms of amount raised, but the second lowest quarter for number of deals.


(Amount raised)

75.745.6 47.4

168.7

65.4 49.179.1

193.6

76.138.1

17.5

131.7

49.3 54.9 60.5

164.7

187.1

100.0 103.3

390.3

68.667.6

105.2

241.4

99.8

121.2

80.2

301.1

123.8 96.0

312.4

532.3

19.0

48.2 27.0

94.2

12.0

205.0

5.3

222.3

31.0 63.2

133.1

227.3

2.0 52.5

76.5

131.0

281.8

193.7177.7

653.2

146.0

321.7

189.6

657.3

206.9222.4 230.8

660.0

175.1

203.4

449.4

828.0

-

100.0

200.0

300.0

400.0

500.0

600.0

700.0

800.0

900.0

Jan-09 Feb-09 Mar-09 Q1/09 Apr-09 May-09 Jun-09 Q2/09 Ju l-09 Aug-09 Sep-09 Q3/09 Oc t-09 Nov- 09 Dec-09 Q4/ 09

(US$m

)Late Stage (D/E)

Mid-Stage (B/C)

Early Stage (Angel/A)

Total

gure 9. Capital Market Activity, by Type, Last Twelve Months, Amountource. Company reports

Financing by Type - 2009(Number of Deals)

7 7 7

21

1410

22

46

21

13

6

40

16

7

15

3819

9 11

39

8

10

17

35

13

15

14

42

12

9

16

37

2

23

7

22

1

5

3

2

4

9

1

2

3

6

28

18

21

67

2422

40

86

37

30

24

91

29

18

34

81

-

10

20

30

40

50

60

70

80

90

100

Jan- 09 Feb-09 Mar-09 Q1 /09 Apr-09 May-09 Jun -09 Q2/ 09 J ul-09 Au g-09 Sep-09 Q3/ 09 Oct-09 Nov-09 Dec -09 Q4/09

(#)

Late Stage (D/E)

Mid-Stage (B/C)

Early Stage (Angel/A)

Total

gure 10. Capital Market Activity, by Type, Last Twelve Months, # of Dealsource. Company reports


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U.S. dominates financing landscape: Figures 11 and 12 show the financing/M&A activity by country (based on compHQ). The U.S. had the most deals over 75% of the to tal (by number of deals).

Financing/M&A by Country - 2009 ($)

UK

7.8%

China

4.4%

USA

46.7%

ROW

2.4%

France

1.3%

Canada

2.0%

Luxembourg

31.2%

Israel

4.1%

Financing/M&A by Country - LTM (#)

China3.6%

USA76.2%

ROW8.5%

Canada4.6%

Israel2.9%

UK4.1%

gures 11 & 12. Capital Market Activity, by Geography, Last Twelve Monthsource. Company reports

O P 10 L I STS

Top 10 funded companies: Facebook tops the financing list for 2009, having raised $200 mill ion (Figure 13). Zynga, ts $180 mill ion round late in the year, came in second ($195 mill ion total), followed by Twitter which raised $135.7 mil

No other company raised more than $100 mill ion in 2 009.

Top 10 Funded Companies - 2009

0.0

50.0

100.0

150.0

200.0

250.0

Facebook Zynga Twitter RockYou Turbine Playdom Youku Zoosk PandoraMedia

ChaCha

(US$mm

)Series E

Series D

Series C

Series B

Series A

gure 13. Top 10 Financed companies, 2009

ource. Company reports


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Top 10 acquirers: As lead investor in the Skype acquisit ion, Silver Lake leads our Top 10 acquirers l ist for 2009 (Fig14). Second was Electronic Arts with the $400 mill ion (including earn-outs) acquisit ion of Playfish. One of the last dannounced in 2009 drove O2 to the #3 spot with its $207 mill ion acquisit ion of JaJah.

Top 10 Acquirers (2009)

By Amount Invested

0

500

1000

1500

2000

2500

SilverLake

ElectronicArts

O2

Intuit

Match

.com

KongZhong

Adknowledge

Network

ShandaInteractive

EntertainmentLtd.

ITV

Hi-MediaS

.A.

(US$mm)

gure 14. Top 10 Acquirers, 2009, Amount investedource. Company reports

Top 10 lead investors (# deals): Accel Partners was the most active lead investor in 2009, leading nine transact(Figure 15). Benchmark Capital was second with seven lead investments, followed by Charles River Ventures with

Four f irms were lead on five transactions.

Most Deals (2009)

By Lead Investor

0

1

2

3

4

5

6

7

8

9

10

Accel

Partners

Benchmark

Capital

Charles R iver

Ventures

New

E nterprise

Associates

Draper Fisher

Jurvetson

Canaan

Partners

August

Capital

Sequoia

Capital

First R ound

Capital

Bessemer

Venture

Partners

gure 15. Top 10 Lead Investors, # of Dealsource. Company reports


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Top 10 lead investors (amount invested): When analyzing amount invested, Digital Sky Technologies was the largead investor in 2009, participating in $380 mill ion of transactions (Figure 16). Insight Venture Partners was second ($

mill ion), followed closely by Benchmark Capital with $99.4 mill ion.

Top 10 Investors (2009)

By Amount Invested

380.0

100.0 99.4 91.970.5 52.5 50.0 50.0 49.0 41.0

0

50

100

150

200

250

300

350

400

DigitalSky

Technologies

InsightVenture

Partners

BenchmarkCapital

AccelPartners

NewEnterprise

Associates

CanaanPartners

GraniteGlobal

Ventures

Softbank

GreylockPartners

Morgenthaler

Ventures

(US$mm)

gure 16. Top 10 Lead Investors, Amount Investedource. Company reports

Top 10 acquisitions: The largest acquisit ion in 2009 was the $2.025 bil l ion acquisit ion of Skype (Figure 17). In secplace was the $400 mill ion Playfish acquisit ion, followed by the $207 mill ion J aJah acquisit ion.

Top 10 Acquisitions - 2009

2025

400

207 17080 80 50 44 42 410

500

1000

1500

2000

2500

Skype PlayFish Jajah Mint Shanghai

Dacheng

Network

People Media Super Rewards Ku6 Friends

Reunited

AdLink Internet

Media

(US$mm

)

gure 17. Top 10 Acquisitions, 2009ource. Company reports


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A PI TA L M A R K ETS A C T I V I TY ( PR I C E PER FO R M A N CE)

Web 2.0 index outpaces NASDAQ in 2009: Our Web 2.0 index (market-cap weighted) essentially mirrored performance of the NASDAQ composite index for the first three months of 2009. Since then, the index has diverged much stronger recovery relative to the NASDAQ index (Figure 18).

Web 2.0 Index Price Performance

0

50

100

150

200

250

1/

5/09

1/1

9/09

2/

2/09

2/1

6/09

3/

2/09

3/1

6/09

3/3

0/09

4/1

3/09

4/2

7/09

5/1

1/09

5/2

5/09

6/

8/09

6/2

2/09

7/

6/09

7/2

0/09

8/

3/09

8/1

7/09

8/3

1/09

9/1

4/09

9/2

8/09

10/1

2/09

10/2

6/09

11/

9/09

11/2

3/09

12/

7/09

12/2

1/09

Index: Web 2.0 (Market Cap) ^COMP - Share Pricing

gure 18. Web 2.0 Price Performanceource. Capital IQ


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Strong 2009 performance: Fifty-three companies in our universe had posit ive stock price performances in 2009 (Fig19), while 27 companies showed negative or f lat returns. The performance for the group was led by Fluid Music Cananc. with a 400% return in 2009, followed by Chinese Gamer International with a 353% return. Twenty-five of

companies saw their stock p rices at least double in 2009. The worst p erformance was by Beyond Commerce, Inc. drop98.4% in 2009. BroadWebAsia Inc. also fell more than 90% (-90.9%).

2009 Price Performance

-98.4%-90.9%-88.0%-74.4%

-64.2%-59.4%-58.0%-55.6%-55.0%-52.2%-50.5%-49.2%-47.9%-45.7%-44.0%-40.5%-40.0%-38.6%

-30.7%-28.0%-26.1%-25.3%-24.2%-20.5%

-14.4%-5.0%

0.0%3.3%4.0%4.4%5.3%9.2%10.4%11.2%13.2%16.1%16.9%17.6%

24.4%28.6%28.8%29.7%33.8%

40.3%42.4%42.6%

50.0%50.0%

57.1%57.7%61.6%65.9%

80.6%82.6%85.7%

103.4%112.6%

121.6%130.1%132.3%

143.7%145.1%

150.3%153.1%155.8%

172.7%179.5%180.0%

184.6%192.3%198.1%200.0%200.0%

221.6%227.3%

235.1%277.2%

353.5%400.0%

181.3%

-200.0% -100.0% 0.0% 100. 0% 200. 0% 300.0% 400.0% 500

Beyond Com merce, Inc.Bro adWebAsia Inc.

CornerWorld CorporationDolphin Digital M edia, Inc.

Wizzard So ftware Corporatio nNorthgate Technologies Limited

UOMO M edia, IncDigitalTown, Inc.Worlds.com Inc.

Ngi Group Inc.GigaMedia Ltd.

The9 LimitedBetawave CorporationSNAP Interactive, Inc.NeXplore Corporation

Look Smart, Ltd.GameOn Co Ltd.

Socialwise, Inc.TheStreet.com , Inc.

M agnitude Information Systems Inc.Asknet AG

Ynk Korea Inc.M yriad Group AG

Jumbuck Entertainment LimitedDADA SpA

Lingo Media Corporatio nGeoSentric Oyj

SpectrumDNA, Inc.Bright Things plc

Eolith Co . Ltd.Quepasa C orp.

PNI Digital M edia Inc.HanbitSoft, Inc.

Giant Interactive Group, Inc.XING AG

YD Online Corp.Sohu.com Inc.

Spark Networks, Inc.United Online Inc.

IAC/InterActiveCorp.Open Text Corp.

Bigstring Corp.M ixi, Inc.

NetDragon WebSoft, Inc.ValueClick Inc.

NeuLion IncorporatedExtensions, Inc.

Uniserve Communications Corp.DXN Holdings Bhd

Shanda Interactive Entertainment Ltd.Actoz Soft Co., Ltd.

Changyou.com LimitedCDC Corp.

Netease.com Inc.Acc elerize New M edia, Inc.

Mo dern Times Group Mtg A BGree, Inc.

Perfect World Co., Ltd.Kingsoft Co . Ltd.

AQ Interactive, Inc.Shutterfly, Inc.

Tree.Com , Inc.Gamania Digital Entertainment Co., Ltd.

Webzen Inc.GungHo Online Entertainment, Inc.

SK Communicatio ns Co., Ltd.OAO RBC Information Systems

Gravity Co., LtdDigitalPos t Interactive, Inc.

iseemedia Inc.Cyberplex Inc.

Frogster Interactive Pictures AGM OKO.mobi Limited

VOIS, Inc.Tencent Holdings Ltd.

M ultiplied M edia Corporatio nOpenwave Systems Inc.

NEOWIZ Games Corporatio nChinese Gamer International

Fluid M usic Canada, Inc.

gure 19. 2009 Price Performanceource. Capital IQ


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A LU A TI O N

2009 ends at record high: After bottoming in November 2008 at $28.8 bil l ion, the combined market capitalization of80 public companies we track hit an all-t ime high at the end of 2009, reaching $77.4 bil l ion (Figure 20).

Market C apitalization

-

10,000

20,000

30,000

40,000

50,000

60,000

70,000

80,000

90,000

Jan-05

Feb-05

Mar-05

Apr-05

May-05

Jun-05

Jul-05

Aug-05

Sep-05

Oct-05

Nov-05

Dec-05

Jan-0

6

Feb-0

6

Mar-06

Apr-06

May-0

6

Jun-0

6

Jul-06

Aug-0

6

Sep-0

6

Oct-06

Nov-0

6

Dec-0

6

Jan-07

Feb-07

Mar-07

Apr-07

May-07

Jun-07

Jul-07

Aug-07

Sep-07

Oct-07

Nov-07

Dec-07

Jan-0

8

Feb-0

8

Mar-08

Apr-08

May-0

8

Jun-0

8

Jul-08

Aug-0

8

Sep-0

8

Oct-08

Nov-0

8

Dec-0

8

Jan-0

9

Feb-0

9

Mar-09

Apr-09

May-0

9

Jun-0

9

Jul-09

Aug-0

9

Sep-0

9

Oct-09

Nov-0

9

(US$m)

gure 20. Total Market Capitalization, Monthlyource. Capital IQ


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Tencent the gorilla: Tencent Holdings (SEHK:700), with a market cap of approximately US$39.5 bil l ion, has drivearge portion of the gains over the last year (Figure 21), rising from a market cap of $9.8 bil l ion in November 2008.

other big contributors have been CYOU (+$1.8 bil l ion), TSE:3632 (+$2.8 bil l ion), MTG.B (+$2.1 bil l ion), NTES (+$bil l ion), and SNDA (+$1.9 bil l ion).

Market C apitalization

-

10,000

20,000

30,000

40,000

50,000

60,000

70,000

80,000

90,000

Jan-05

Mar-05

May-05

Jul-05

Sep-05

Nov-05

Jan-0

6

Mar-06

May-0

6

Jul-06

Sep-0

6

Nov-0

6

Jan-07

Mar-07

May-07

Jul-07

Sep-07

Nov-07

Jan-0

8

Mar-08

May-0

8

Jul-08

Sep-0

8

Nov-0

8

Jan-0

9

Mar-09

May-0

9

Jul-09

Sep-0

9

Nov-0

9

(US$m)

AC LZ A052790

3838 XT R A:A5A

B S G C B W AV

B Y OC AIM: B G T

B W B A C HIN.A

C Y OU G T S M:3083

C W R L T S X: C X

C M:DA DXN

DG L P DG T W

DP DM A041060

E XT I T S X: F MN

F R G 6180

3812 G E O1V

G A G IG M

G R V Y T S E :3632

3765 A047080

IAC I IE E

AS X : J MB 3888

T S XV :L M LOOK

MAG Y 2121

MT G B MK B

T S XV :MMC MY R N

A095660 777

NT E S T S X: NLN

NXP C 2497

590057 OT E X

OP W V P W R D

T S XV :P N QP S A

R B C I S NDA

S F L Y A066270

S T V I S C LW

S OHU LOV S P XA 700

NC T Y T S C M

T R E E T S XV :US S

UNT D UOMO

V C LK V OIS

K OS E : A069080 W ZE

W DDD O1B C

A052770 A023770

gure 21. Market Capitalization, By Company & Monthource. Capital IQ


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Online Gaming companies lead market-cap charts: Thirteen companies in our Web 2.0 universe top US$1 bil l iomarket capitalization (Figure 22). Forty-six of the 80 companies have market caps under US$100 mill ion, with 28 uUS$25 mill ion. Online gaming companies dominate the top of the list, led by Tencent Holdings (SEHK:700) with a macap of approximately US$39.5 bil l ion.

Market Cap ($US mm)

1. 21. 41. 52. 93. 73. 73. 94. 14. 24. 85. 67. 68. 09. 211.211.711.913.313.515.115.916.818.218.720.221.822.424.325.531.232.632.836.440.146.751.353.0

61.764.172.172.874.074.676.777.994.8101.3104.7114.1128.8136.8178.8179.8193.1193.9205.8232.1237.5260.7

275.4311.5463.7561.6618.6734.8869.9905.91107.41217.01594.31838.11980.32209.92289.12733.12763.03266.23549.74888.439524.0

0 500 1,000 1,500 2,000 2,500 3,000 3,500 4,000

Bey ond Commerce, Inc.Unis erv e Communications Corp.

B igstring Corp.CornerWorld Corporation

Betaw ave CorporationUOMO Media, Inc

DigitalPos t Interac tive, Inc.S NAP Interac tive, Inc.

BroadWebAs ia Inc.Worlds.c om Inc.

Br ight Things plcS pectrumDNA, Inc.

Magnitude Information S ys tems Inc.ise emedia Inc.

Lingo Media Corpora tionDolphin Digital Media, Inc.

V OIS , Inc.Ex tens ions, Inc.

Jumbuck Entertainment LimitedY nk Korea Inc.

MOKO. mobi LimitedLookS mart, Ltd.

Wizza rd S oftware CorporationAc celerize New Media, Inc.

Northgate Tec hnologies LimitedAsknet AG

Multiplied Media CorporationS ocialw ise, Inc.Quepas a Corp.

NeXplore CorporationNgi Group Inc.

DigitalTow n, Inc.DXN Holdings B hd

AQ Interactive, Inc.Grav ity Co., LtdGeoS entric Oyj

PNI Digital Media Inc.

S park Networks, Inc.Frogs ter Interac tive Pictures A G

HanbitS oft, Inc.TheStreet.com, Inc.

NeuLion IncorporatedCyberplex Inc.

GameOn Co Ltd.Eolith Co. Ltd.

Y D Online Corp.Tree. Com, Inc.

Fluid Music Ca nada, Inc.Webzen Inc.

Ac toz S oft Co., L td.DADA SpA

GigaMedia Ltd.The9 Limited

Openw ave S ys tems Inc.OA O RB C Information Sy s tems

Myriad Group AGXING A G

CDC Corp.Ga mania Digital E ntertainment Co., Ltd.

NetDragon WebS oft, Inc.GungHo O nline E ntertainment, Inc.

S hutterfly, Inc.S K Communications Co., Ltd.

United Online Inc.NEOWIZ Games Corporation

V alueClick Inc.Kingsof t Co. Ltd.

Chinese G amer InternationalMixi, Inc.

Giant Interactive Group, Inc.Changyou. com L imitedPerfect World Co., Ltd.

S ohu.com Inc.Open Text Corp.

IAC/InterActiveCorp.Gree, Inc.

Modern Times G roup Mtg ABS handa Interac tive E ntertainment Ltd.

Neteas e.c om Inc.Tenc ent Holdings Ltd.

gure 22. Market Cap Rankinource. Capital IQ


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Page

TEV/Revenue (LTM) averages 2.47x: The overall median TEV/Revenue (LTM) multiple for our group is 2.47x (Figure The multiple at year-end dropped slightly from 2.53x at the end of November. The average multiple troughed in Octo2008 at just 1.40x and peaked at 4.49x in January 2007. Note that we exclude multiples greater than 100x.

EV / Revenue

0.0x

0.5x

1.0x

1.5x

2.0x

2.5x

3.0x

3.5x

4.0x

4.5x

5.0x

Jan-05

Mar-05

May-05

Jul-05

Sep-05

Nov-05

Jan-0

6

Mar-06

May-0

6

Jul-06

Sep-0

6

Nov-0

6

Jan-07

Mar-07

May-07

Jul-07

Sep-07

Nov-07

Jan-0

8

Mar-08

May-0

8

Jul-08

Sep-0

8

Nov-0

8

Jan-0

9

Mar-09

May-0

9

Jul-09

Sep-0

9

Nov-0

9

Multiple

(x)

0

10

20

30

40

50

60

70

80

C i

( # )

Media n C ount

gure 23. TEV/Revenue, By Monthource. Capital IQ


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Page

TEV/Revenue (LTM) by company: Three companies trade above 25x revenue Tencent Holdings Ltd. (27.4x), BigstCorp. (40.4x), and Dolphin Digital Media, Inc. (42.1x) (Figure 24). Twenty-one companies have multiples under 1.0x.

TE V/LT M R evenue (x)

0.0 0.1 0.1 0.10.3 0.3 0.4 0.4 0.4 0.4 0.5 0.5 0.6 0.6 0.60.7 0.8 0.8 0.8 0.9 1.0 1.0 1.2 1.2 1.3 1.3

1.6 1.6 1.7 1.9 2.0 2.22.3 2.3 2.4 2.8 2.9 2.9

3.2 3.3 3.4 3.85.1 5.1 5.2

5.7 6.0 6.06.7

8.1 8.1

12.013.113.2

14.9

17.6

20.721.0

27.4

40.

0. 0

5. 0

10.0

15.0

20.0

25.0

30.0

35.0

40.0

45.0

GameOnCoLtd.

AsknetAG

TheStreet.com,Inc.

BetawaveCorporation

AQInteractive,Inc.

Tree.Com,Inc.

PerfectWorldCo.,Ltd.

UniserveCommunicationsCorp.

JumbuckEntertainmentLimited

NorthgateTechnologiesLimited

OpenwaveSystemsInc.

CyberplexInc.

GigaMediaLtd.

CDCCorp.

DXNHoldingsBhd

ActozSoftCo.,Ltd.

SNAPInteractive,Inc.

DADASpA

IAC/InterActiveCorp.

UnitedOnlineInc.

BeyondCommerce,Inc.

HanbitSoft,Inc.

YnkKoreaInc.

SparkNetworks,Inc.

ValueClickInc.

NetDragonWebSoft,Inc.

GamaniaDigitalEntertainmentCo.,Ltd.

Shutterfly,Inc.

YDOnlineCorp.

CornerWorldCorporation

ModernTimesGroupMtgAB

PNIDigitalMediaInc.

WebzenInc.

GungHoOnlineEntertainment,Inc.

NeuLionIncorporated

SKCommunicationsCo.,Ltd.

OpenTextCorp.

XINGAG

MyriadGroupAG

Sohu.comInc.

NEOWIZGamesCorporation

WizzardSoftwareCorporation

DigitalPostInteractive,Inc.

iseemediaInc.

UOMO

Media,Inc

AccelerizeNewMedia,Inc.

Changyou.comLimited

KingsoftCo.Ltd.

FrogsterInteractivePicturesAG

LingoMediaCorporation

Mixi,Inc.

GeoSentricOyj

Gree,Inc.

EolithCo.Ltd.

ChineseGamerInternational

FluidMusicCanada,Inc.

NeXploreCorporation

MOKO.mobiLimited

TencentHoldingsLtd.

BigstringCorp.

gure 24. TEV/Revenue Rankingource. Capital IQ

TEV/Revenue (LTM) by country/exchange: We have also calculated multiples based on where the companies are l ior domiciled. Figure 25 shows the average TEV/Revenue multiples by stock exchange. The OTCBB has the largnumber of companies (16), trading at an average multiple of 11.4x. On a geographic basis, the United States has the mcompanies (29), trading at an average of 7.7x r evenue (Figure 26).

Average TEV/LTM Revenue - By Exchange

0.00.20.40.6

0.81.72.02.3

2.53.23.23.33.95.46.8

8.210.7

11.411.6

12.0

20.7

0.0

5.0

10.0

15.0

20.0

25.0

OTCPK

HLSE

SEHK

OTCBB

ASX

GTSM

TSX

TSE

TSXV

KOSE

XTRA

SWX

AMEX

OSEOM

NasdaqGS

CM

KLSE

BSE

NasdaqGM

RTS

3 1 3 16 2 2 3 5 5 8 3 1 2 1 1 14 1 1 1 4 1

(x)

# Companies

Average TEV/LTM Revenue - By Country

0.6 0.40.60.82.0

3.23.2

3.33.34.8

5.77.4

7.7

10.7

12.0

0.0

2.0

4.0

6.0

8.0

10.0

12.0

14.0

Finlan

d

Aus

tra

lia

Un

ited

States

China

Ta

iwan

Japan

Cana

da

Sou

th

Korea

Germany

Sw

itzerlan

d

Swe

den

Ita

ly

Ma

lays

ia

Hong

Kong

India

1 2 29 10 3 6 9 9 3 1 1 1 1 1 1

(x)

# Companies

gures 25 & 26. TEV/Revenue Ranking (Exchange, Country)ource. Capital IQ


18/31

Page

TEV/EBITDA (LTM) averages 11.6x: The median multiple for the 41 companies with p osit ive EBITDA (and multiples u100x) is 10.75x LTM EBITDA (Figure 27). The median multiple has risen slightly from 10.50x at the end of Novembers sti l l well below the peak of 23.7x in April 2 006. The median is up signif icantly from the recent trough levels around 5

EV / EBITDA

0.0x

5.0x

10.0x

15.0x

20.0x

25.0x

Jan-05

Mar-05

May-05

Jul-05

Sep-05

Nov-05

Jan-0

6

Mar-06

May-0

6

Jul-06

Sep-0

6

Nov-0

6

Jan-07

Mar-07

May-07

Jul-07

Sep-07

Nov-07

Jan-0

8

Mar-08

May-0

8

Jul-08

Sep-0

8

Nov-0

8

Jan-0

9

Mar-09

May-0

9

Jul-09

Sep-0

9

Nov-0

9

Multiple

(x)

0

5

10

15

20

25

30

35

40

45

C i

( # )

Me dia n C ount

gure 27. TEV/EBITDA , By monthource. Capital IQ


19/31

Page

TEV/EBITDA (LTM) by company: Uniserve Communications Corp. (40.2x) and SK Communications Co., Ltd. (43.7x) hthe highest multiples in the group (Figure 28). Fourteen companies have EBITDA multiples under 7x.

TEV/LTM EBITDA (x)

0. 2 0. 3 0. 7 1. 03. 4 4. 1 4. 2

4 .4 4 . 5 4. 8 5. 0 5. 45. 8 6. 0

7 . 6 7 . 8 8. 09. 4 9. 7 10.3

10.5 10.8 11.0 11.212.7 12.8 13.0 13.2

13.8 14.214.9

21.022.6

24.525.7

27.7

40.2

4

0. 0

5. 0

10.0

15.0

20.0

25.0

30.0

35.0

40.0

45.0

50.0

GameOnCoLtd.

OAO

RBCInformationSystems

PerfectWorldCo.,

Ltd.


ActozSoftCo.,

Ltd.

UnitedOnlineInc.

TheStreet.com,

Inc.

NetDragonWebSoft

,Inc.

CyberplexInc.

SNAPInteractive,

Inc.

AQ

Interactive,

Inc.

ValueClickInc.

SparkNetworks,

Inc.

DADASpA

Sohu.c

om

Inc.

Tree.C

om,

Inc.

YDOnlineCorp.

GamaniaDigitalEntertainmentCo.,

Ltd.

Changyou.c

om

Limited

CDCCorp.


XING

AG

YnkKoreaInc.

OpenTextCorp.


PNIDigitalMediaInc.

Shutterfly

,Inc.



OpenwaveSystemsInc.

KingsoftCo.

Ltd.

WebzenInc.

Gree,

Inc.

Mixi,Inc.


EolithCo.

Ltd.

UniserveCommunicationsCorp.

gure 28. TEV/EBITDA Rankingource. Capital IQ

TEV/EBITDA (LTM) by country/exchange: Figure 29 shows the average TEV/EBITDA multiples by stock exchange. OTCBB has the largest number of companies (14), trading at an a verage multiple of 4.8x. On a geographic basis, the has the most companies (29), trading at an ave rage of 8.1x EBITDA (Figure 30).

Average TEV/LTM EBITDA - By Exchange

0.31.0

4.54.85.86.06.0

8.99.710.510.813.113.8

17.618.2

26.5

0.0

5.0

10.0

15.0

20.0

25.0

30.0

TSXV

KOSE

GTSM

OM

TSE

XTRA

OSE

SEHK

NasdaqGS

NasdaqGM

CM

AMEX

OTCBB

TSX

ASX

RTS

5 8 2 1 5 3 1 3 14 4 1 2 16 3 2 1

(x)

# Companies

Average TEV/LTM EBITDA - By Country

1.0

6.0

7.58.110.310.8

12.613.8

17.2

17.6

18.2

0.0

2.0

4.0

6.0

8.0

10.0

12.0

14.0

16.0

18.0

20.0

South

Korea

Taiwan

Canada

Sweden

Japan

Germany

Hong

Kong

United

States

China

Italy

Australia

9 3 9 1 6 3 1 29 10 1 2

(x)

# Companies

gures 29 & 30. TEV/EBITDA Ranking (Exchange, Country)ource. Capital IQ


20/31

Page

P/E (LTM) averages 21.0x: The median multiple for the 32 companies with posit ive earnings (and multiples under 10017.7x LTM EPS (Figure 31). This is up from 16.0x at the end of November and well above the 8.8x trough multiplNovember 2008. The peak multiple was 37.4x in April 2006.

P / E

0.0x

5.0x

10.0x

15.0x

20.0x

25.0x

30.0x

35.0x

40.0x

Jan-05

Mar-05

May-05

Jul-05

Sep-05

Nov-05

Jan-0

6

Mar-06

May-0

6

Jul-06

Sep-0

6

Nov-0

6

Jan-07

Mar-07

May-07

Jul-07

Sep-07

Nov-07

Jan-0

8

Mar-08

May-0

8

Jul-08

Sep-0

8

Nov-0

8

Jan-0

9

Mar-09

May-0

9

Jul-09

Sep-0

9

Nov-0

9

Multiple

(x)

0

5

10

15

20

25

30

35

40

C i

( # )

Me dia n C ount

gure 31. P/E, By Monthource. Capital IQ


21/31

Page

P/E (LTM) by company: Five companies have multiples greater than 50x GungHo Online Entertainment, Inc. (60Webzen Inc. (61.4x), Mixi, Inc. (63.1x), Tencent Holdings Ltd. (68.6x), and HanbitSoft, Inc. (70.0x) (Figure 32). Fcompanies have P/E multiples under 10x.

P/E LT M (x)

1. 7 2. 0 2 .3 2 .4 2. 63. 8 5. 3

6. 5 7. 1 8. 09. 8 11.6

12.4 13.4 13.5

17.9 18.119.9 20.5

22.8

27.331.4

33.737.3

48.5 49.9

60.6 61.463.1

68.6 70

0. 0

10.0

20.0

30.0

40.0

50.0

60.0

70.0

80.0

GiantInteractiveGroup,

Inc.

The9Limited

ShandaInteractiveEntertainmentLtd.

PerfectWorldCo.,

Ltd.

Netease.c

om

Inc.


DXNHoldingsBhd

CyberplexInc.

GigaMediaLtd.

GameOnCoLtd.

YDOnlineCorp.


Changyou.c

om

Limited

NetDragonWebSoft

,Inc.

Sohu.c

om

Inc.

ActozSoftCo.,

Ltd.


KingsoftCo.

Ltd.

SparkNetworks,

Inc.

SNAPInteractive,

Inc.

GamaniaDigitalEntertainmentCo.,

Ltd.

XING

AG



Gree,

Inc.

OpenTextCorp.


WebzenInc.

Mixi,Inc.

TencentHoldingsLtd.

H a n b i t S o f t I n c

gure 32. P/E Rankingource. Capital IQ

P/E (LTM) by country/exchange: Figure 33 shows the average P/E multiples by stock exchange. The OTCBB hasargest number of companies (16), trading at an average multiple of 22.8x. On a geographic basis, the U.S. has the m

companies (29), trading at an average of 18 .3x earnings (Figure 34).

Average P/E - By Exchange

0.0 0.01.7

3.85.36.5

11.618.120.5

22.830.5

31.434.0

39.339.8

60.6

0.0

10.0

20.030.0

40.0

50.0

60.0

70.0

OSE

TSE

KOSE

SEHK

XTRA

GTSM

OTCBB

AMEX

OM

Nas

daq

GS

TSX

KLSE

ASX

NYSE

Nas

daq

GM

SWX

1 5 8 3 3 2 16 2 1 14 3 1 2 1 4 1

(x)

# Companies

Average P/E - By Country

35.3

13.918.118.322.7

28.231.432.7

45.0

0.0

5.0

10.0

15.0

20.025.0

30.0

35.0

40.0

45.0

50.0

Japan

Sou

th

Korea

Germany

Cana

da

Ta

iwan

Un

ited

States

Swe

den

China

Ma

lays

ia

6 9 3 9 3 29 1 10 1

(

x)

# Companies

gures 33 & 34. P/E Ranking (Exchange, Country)ource. Capital IQ


22/31

Page

HE WEB 2.0 UN IVERSE

Eighty public Web 2.0 companies: Our Web 2.0 universe contains 80 companies, with a combined market caapproximately $77.3 bil l ion (Figure 35). The median market cap for the group is $72.4 mill ion, with average trairevenue of $176.5 mill ion (median $59 mill ion). The companies are also general ly profitable with a median EBITDA maof 15.6%. On a valuation basis, the overall average is 5.4x trail ing revenue (median 1.9x) and 11.7x trail ing EBIT

(median 10.0x). Twenty of the companies have more than 500 employees.Comparable Company Analysis > Web 2.0

ompany Name L TM a s of Tic ker E xc ha nge

Trading

Currency HQ

Current

Price

USD Market

Cap ($m)

USD LTM Total

Rev ($m)

USD LTM Total

EBITDA ($m)

EBITDA

%

TEV/LTM

Revenue

TEV/LTM

E B I TD A E m pl

ccelerize New Media, Inc. 9/30/2009 AC LZ OT C B B US D United S tates 0. 65 18. 7 4. 1 (1.5) -36. 5% 5.7x -

ctoz S oft C o. , Ltd. 9/30/2009 A052790 K OS E K R W S outh K orea 17, 050 128.8 118.8 26. 4 22. 2% 0.7x 3. 4x N

Q Interactive, Inc. 9/30/2009 3838 T S E J P Y J apa n 68, 300 40. 1 71.4 3.6 5.1% 0.3x 5. 0x N

s knet AG 9/30/2009 XT R A: A5A XT R A E UR G ermany 3 21. 8 101.1 (2.3) -2.3% 0.1x - N

gs tring C orp. 9/30/2009 B S G C OT C B B US D United S tates 0. 02 1.5 0. 1 (1.0) NM 40.4x -

eta wave C orporation 9/30/2009 B W AV OT C B B US D United S tates 0. 13 3.7 8. 4 (14. 3) NM 0.1x - 4

eyond C ommerce, Inc. 9/30/2009 B Y O C OT C B B US D United S tates 0. 02 1.2 13.5 (12. 4) -91. 9% 1.0x - 8

right T hings plc 3/31/2009 AIM: B G T AIM G B P United K ingdom 0. 01 5.6 0. 0 (2.7) NM - - N

roa dW ebAs ia Inc. 9/30/2008 B W B A OT C P K US D United S tates 0. 05 4.2 0. 0 (4.6) NM - - 4

DC C orp. 9/30/2009 C HIN.A Na s daqG S US D Hong K ong 2. 24 237.5 334.2 20. 0 6.0% 0.6x 10.3x 2,

hangyou. com Limited 9/30/2009 C Y OU Na s daqG S US D C hina 33.42 1, 838.1 255.3 157. 4 61. 7% 6.0x 9. 7x 6

hines e G amer Interna tional 9/30/2009 G T S M: 3083 G T S M T W D T aiwan 424.00 1, 107.4 68.8 39. 9 58. 0% 14.9x 25.7x N

ornerW orld C orporation 7/31/2009 C W R L OT C B B US D United S tates 0. 03 2.9 6. 8 NM NM 1.9x -

yberplex Inc. 9/30/2009 T S X: C X T S X C AD C a nada 1 74. 6 109.0 12. 1 11. 1% 0.5x 4. 5x N

ADA S pA 6/30/2009 C M: DA C M E UR Italy 5. 91 136.8 236.1 31. 0 13. 1% 0.8x 6. 0x N

XN Holdings B hd 8/31/2009 DXN K LS E MY R Malays ia 0. 55 36. 4 78.5 (85. 2) NM 0.6x - N

igitalP os t Interactive, Inc. 9/30/2009 DG LP OT C B B US D United S tates 0 3.9 1. 2 (0.9) -73. 8% 5.1x -

igita lT own, Inc. 8/31/2009 DG T W OT C B B US D United S tates 1. 20 32. 8 0. 0 (1.8) NM - -

olphin Digital Media , Inc. 9/30/2009 DP DM OT C B B US D United S tates 0. 21 11. 7 0. 3 (4.6) NM 42.1x - N

olith C o. Ltd. 9/30/2009 A041060 K OS E K R W S outh K orea 595.00 77. 9 5. 9 2.8 47. 6% 13.2x 27.7x N

xtens ions , Inc. 9/30/2009 E XT I OT C P K US D United S tates 0. 30 13. 3 0. 0 NM NM - - uid Mus ic C anada, Inc. 9/30/2009 T S X: F MN T S X C AD United S tates 1. 75 104.7 5. 6 (3.0) -54. 0% 17.6x - N

rogs ter Interactive P ictures AG 6/30/2009 F R G XT R A E UR G ermany 17.50 64. 1 9. 4 (4.4) -47. 0% 6.7x - N

ama nia Digital E nterta inment C o. , Ltd. 9/30/2009 6180 G T S M T W D T aiwan 55 2 60.7 152.2 25. 1 16. 5% 1.6x 9. 4x N

ameOn C o Ltd. 9/30/2009 3812 T S E J P Y J apa n 73500. 00 76. 7 76.5 18. 0 23. 5% 0.0x 0. 2x N

eoS entric Oyj 9/30/2009 G E O1V HL S E E UR F inla nd 0. 04 51. 3 4. 5 (18. 5) NM 12.0x - 1

iant Interactive G roup, Inc. 9/30/2009 G A NY S E US D C hina 7. 04 1, 594.3 202.3 137. 9 68. 2% - - 1,

iga Media Ltd. 3/31/2009 G IG M Na s daqG S US D T aiwan 3. 28 178.8 183.6 NM NM 0.6x - 7

ravity C o. , Ltd 9/30/2009 G R V Y Na s daqG M US D S outh K orea 2 46. 7 51.2 18. 1 35. 4% - - 4

ree, Inc. 9/30/2009 T S E :3632 T S E J P Y J apa n 5720.00 2, 763.0 202.9 117. 9 58. 1% 13.1x 22.6x N

ungHo O nline E ntertainment, Inc. 9/30/2009 3765 OS E J P Y J apa n 252000 311.5 116.4 25. 9 22. 3% 2.3x 10.5x NanbitS oft, Inc. 9/30/2009 A047080 K OS E K R W S outh K orea 3830.00 72. 1 59.1 (0.3) -0.6% 1.0x - N

C /InterActiveC orp. 9/30/2009 IAC I Na s daqG S US D United S tates 20.71 2, 733.1 1, 359.6 82. 4 6.1% 0.8x 13.2x 3,

eemedia Inc. 9/30/2009 I E E T S XV C AD C a nada 0 9.2 1. 9 (4.2) NM 5.1x - N

umbuck E ntertainment Limited 6/30/2009 AS X: J MB AS X AUD Aus tralia 0 13. 5 17.1 7.3 42. 8% 0.4x 1. 0x 7ngs oft C o. Ltd. 9/30/2009 3888 S E HK HK D C hina 6 905.9 143.5 57. 7 40. 2% 6.0x 14.9x 2,

ngo Media C orpora tion 9/30/2009 T S XV : LM T S XV C AD C a nada 0. 95 11. 2 1. 4 (2.3) NM 8.1x - N

ookS mart, Ltd. 9/30/2009 LOO K Na s daqG M US D United S tates 0. 98 16. 8 54.0 (4.5) -8.4% - - 9

agnitude Information S ys tems Inc. 9/30/2009 MAG Y OT C B B US D United S tates 0. 02 8.0 0. 1 (2.3) NM - -

ixi, Inc. 9/30/2009 2121 T S E J P Y J apa n 732, 000 1, 217.0 134.7 44. 5 33. 0% 8.1x 24.5x N

odern T imes G roup Mtg AB 9/30/2009 MT G B OM S E K S weden 356 3, 266.2 1, 942.0 274. 4 14. 1% 2.0x 13.8x 2,

O K O.mobi L imited 6/30/2009 MK B AS X AUD Aus tralia 0. 15 15. 9 0. 7 (2.5) NM 21.0x - N

ultiplied Media C orporation 9/30/2009 T S XV : MMC T S XV C AD C a nada 0. 18 22. 4 0. 2 (4.7) NM - - N

yriad G roup AG 6/30/2009 MY R N S W X C HF S witzerland 4. 85 205.8 63.0 3.4 5.4% 3.2x - 4

E OW IZ G ames C orporation 12/31/2008 A095660 K OS E K R W S outh K orea 40550. 00 734.8 212.7 57. 1 26. 8% 3.4x 12.7x N

etDragon W ebS oft, Inc. 9/30/2009 777 S E HK HK D C hina 4. 04 275.4 91.4 27. 8 30. 4% 1.3x 4. 4x 2,

eteas e.com Inc. 9/30/2009 NT E S Na s daqG S US D C hina 37.77 4, 888.4 483.1 291. 9 60. 4% - - 3,

euLion Incorporated 9/30/2009 T S X: NLN T S X C AD C a nada 0. 67 74. 0 24.9 (16. 1) -64. 5% 2.4x - 2

eXplore C orporation 6/30/2009 NXP C OT C P K US D United S tates 0. 56 31. 2 1. 7 (13. 3) NM 20.7x - N

gi G roup Inc. 9/30/2009 2497 T S E J P Y J apa n 24400. 00 32. 6 78.8 3.1 3.9% - - Northgate T echnologies Limited 9/30/2009 590057 B S E INR India 27 20. 2 47.7 (51. 2) NM 0.4x - N

pen T ext C orp. 9/30/2009 O T E X Na s daqG S US D C a nada 40.60 2, 289.1 814.5 211. 1 25. 9% 2.9x 11.2x 3,

penwave S ys tems Inc. 9/30/2009 O P W V Na s daqG S US D United S tates 2. 31 193.1 190.5 6.2 3.3% 0.5x 14.2x 5

erfect W orld C o. , Ltd. 9/30/2009 P W R D Na s daqG S US D C hina 40 1, 980.3 286.2 157. 4 55. 0% 0.4x 0. 7x 2,NI Digital Media Inc. 9/30/2009 T S XV : P N T S XV C AD C a nada 1. 66 53. 0 23.2 3.9 17. 0% 2.2x 12.8x N

uepa sa C orp. 9/30/2009 Q P S A OT C B B US D United S tates 2. 00 25. 5 0. 2 (9.8) NM - -

AO R B C Information S ys tems 12/31/2007 R B C I R T S US D R us sia 1. 40 193.9 156.3 20. 4 13. 1% 0.0x 0. 3x N

handa Interactive E ntertainment Ltd. 9/30/2009 S NDA Na s daqG S US D C hina 52.78 3, 549.7 694.6 317. 3 45. 7% - - 3,hutterfly, Inc. 9/30/2009 S F LY Na s daqG S US D United S tates 18.06 463.7 223.1 27. 0 12. 1% 1.6x 13.0x 5

K C ommunications C o. , Ltd. 12/31/2008 A066270 K OS E K R W S outh K orea 15600. 00 561.6 197.7 12. 9 6.5% 2.8x 43.7x N

NAP Interactive, Inc. 9/30/2009 S T V I OT C B B US D United S tates 0 4.1 3. 4 0.5 15. 6% 0.8x 4. 8x

ocialwise, Inc. 6/30/2009 S C LW OT C B B US D United S tates 0. 51 24. 3 0. 0 (5.6) NM - - N

ohu.com Inc. 9/30/2009 S O HU Na s daqG S US D C hina 57.46 2, 209.9 501.0 218. 4 43. 6% 3.3x 7. 6x 3,

park Networks , Inc. 9/30/2009 LOV AME X US D United S tates 3. 00 61. 7 47.5 10. 0 21. 0% 1.2x 5. 8x 1

pectrumDNA, Inc. 9/30/2009 S P XA OT C B B US D United S tates 0. 16 7.6 0. 1 (2.5) NM - - T encent Holdings L td. 9/30/2009 700 S E HK HK D C hina 169 39,524. 0 1, 589.0 811. 6 51. 1% 27.4x -

T he9 Limited 12/31/2008 N C T Y Na s daqG S US D C hina 7. 16 179.8 250.7 85. 5 34. 1% - -

T heS treet. com, Inc. 3/31/2009 T S C M Na s daqG M US D United S tates 2 72. 8 67.0 1.9 2.9% 0.1x 4. 2x

T ree.C om, Inc. 9/30/2009 T R E E Na s daqG M US D United S tates 9. 29 101.3 217.1 9.7 4.5% 0.3x 7. 8x nis erve C ommunications C orp. 8/31/2009 T S XV : US S T S XV C AD C a nada 0. 06 1.4 16.6 0.2 0.9% 0.4x 40.2x N

nited Online Inc. 9/30/2009 UNT D Na s daqG S US D United S tates 7 618.6 996.8 212. 9 21. 4% 0.9x 4. 1x 1,

OMO Media , Inc 7/31/2009 UOMO OT C B B US D C a nada 0 3.7 0. 8 (0.4) -54. 2% 5.2x - N

alueC lick Inc. 9/30/2009 V C LK Na s daqG S US D United S tates 10 869.9 545.7 130. 8 24. 0% 1.3x 5. 4x 1,

OIS , Inc. 6/30/2009 V O IS OT C B B US D United S tates 0. 01 11. 9 0. 0 (1.0) NM - - ebzen Inc. 9/30/2009 K O S E :A069080 K OS E K R W S outh K orea 11200. 00 114.1 23.6 2.6 11. 0% 2.3x 21.0x 3

izzard S oftware C orpora tion 9/30/2009 W ZE AME X US D United S tates 0. 34 18. 2 5. 2 (3.9) -76. 4% 3.8x - 1

orlds . com Inc. 9/30/2009 W DDD OT C B B US D United S tates 0. 09 4.8 0. 1 (0.6) NM - - NG AG 9/30/2009 O 1B C XT R A E UR G ermany 30.80 232.1 61.0 16. 5 27. 0% 2.9x 10.8x 2

D Online C orp. 12/31/2007 A052770 K OS E K R W S outh K orea 7350.00 94. 8 58.9 12. 7 21. 6% 1.7x 8. 0x N

nk K orea Inc. 12/31/2008 A023770 K OS E K R W S outh K orea 3290 15. 1 12.2 1.3 10. 5% 1.2x 11.0x N

igh 39,524. 0 1,942. 0 811.6 68. 2% 42.1x 43.7x 6,1

ow 1.2 0.0 -85.2 -91. 9% 0.0x 0. 2x

verage 966.1 176.5 45.1 11.8% 5.4x 11.7x 1,0edian 72. 4 59.0 3. 4 15. 6% 1.9x 10.0x 3

gure 35. Web 2.0 Universe Summaryource. Capital IQ


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Page

Comparable Company Analysis > Web 2.0

Price Performance

C ompany Name C urrency Ticker E xchange US D Market Cap ($m) C urrent Price 1 Wk 1 Mth 3 Mth 6 Mth 1 Yr 52 W

Accele rize New Media, Inc. U S D AC LZ OT C B B 18.7 0.65 0. 0% -11.0% 0.0% 62.5% 85.7% -18

Actoz S oft C o. , L td. K R W A052790 K OS E 128.8 17,050 -6 .8% -22.0% -5.3% -33.8% 61.6% -52

AQ Interactive , Inc. J P Y 3838 T S E 40.1 68,300 50.8% 68.9% 34.2% -1.7% 132.3% -17

Asknet AG E U R XT R A:A5A XT R A 21.8 3.03 -3 .8% -16.1% -2.3% -3.5% -26.1% -26

B igs tring C orp. U S D B S G C OT C B B 1. 5 0.02 20.6% -17.2% -33.3% -29.4% 29.7% -57

B etawave C orporation U S D B W AV OT C B B 3. 7 0.13 4. 2% 56.3% 56.3% 56.3% -47.9% -47

B eyond C ommerce , Inc. U S D B Y O C OT C B B 1. 2 0.02 0. 0% -50.0% -85.2% -94.9% -98.4% -98B right T hings plc G B P AIM:B G T AIM 5. 6 0.01 13.0% 6.1% 3.8% -13.3% 4. 0% -47

B roadW ebAs ia Inc. U S D B W B A OT C P K 4. 2 0.05 -44.4% -44.4% -78.3% -78.3% -90.9% -97

C DC C orp. U S D C H IN.A Nas daqG S 237.5 2.24 -2 .6% -8.9% -9.3% 48.3% 80.6% -42

C hangyou.com L imited U S D C Y OU Nas daqG S 1,838.1 33.42 -0 .2% 1.2% 2.7% -16.0% N M -30

C hines e G amer Inte rnational T W D G T S M:3083 G T S M 1,107.4 424.00 3. 4% -1.6% -9.8% -4.3% 353.5% -18

C ornerW orld C orpora tion U S D C W R L OT C B B 2. 9 0.03 0. 0% -40.0% -50.0% -50.0% -88.0% -92

C yberplex Inc. C AD T S X:C X T S X 74.6 1.14 -0 .9% -7.3% -12.3% -30.9% 192.3% -42

DADA S pA E U R C M: DA C M 136.8 5.91 1. 1% -5.9% -14.8% -8.0% -14.4% -27

DXN Holdings B hd MY R DXN K LS E 36.4 0.55 -1 .8% -1.8% -8.3% 48.6% 57.1% -20

Digita lP os t Interactive, Inc. U S D DG LP OT C B B 3. 9 0.05 -8 .2% -15.1% -19.6% 28.6% 181.3% -54

Digita lT own, Inc. U S D DG T W OT C B B 32.8 1.20 18.8% -14.3% -40.0% -41.5% -55.6% -65

Dolphin Digital Media, Inc. U S D DP DM OT C B B 11.7 0.21 -2 .4% -26.8% -48.8% -57.3% -74.4% -74

E olith C o. Ltd. K R W A041060 K OS E 77.9 595.00 4. 4% 6.3% -18.5% -20.1% 4. 4% -48

E xtens ions , Inc. U S D E XT I OT C P K 13.3 0.30 -33.3% 0.0% 25.0% 200. 0% 50.0% -70

F luid Mus ic C anada , Inc. C AD T S X:F MN T S X 104.7 1.75 1. 2% -12.5% 25.0% 150. 0% 400.0% -18

F rogs ter Interactive P icture s AG E U R F R G XT R A 64.1 17.50 0. 3% -1.4% -2.7% 54.9% 198.1% -18

G amania Digita l E nterta inment C o. , L td. T W D 6180 G T S M 260.7 54.70 8. 7% 18.8% 14.3% -7.3% 150.3% -20

G ameOn C o Ltd. J P Y 3812 T S E 76.7 73,500.00 11.5% 17.8% -17.5% -32.9% -40.0% -44

G eoS entric Oyj E U R G E O1V HLS E 51.3 0.04 -20.0% 0.0% -20.0% 0.0% 0. 0% -33

G iant Interactive G roup, Inc. U S D G A NY S E 1,594.3 7.04 0. 4% -1.4% 6.8% -11.3% 11.2% -26

G igaMedia Ltd. U S D G IG M Nas daqG S 178.8 3.28 3. 1% -17.6% -29.9% -41.5% -50.5% -57

G ravity C o. , L td U S D G R V Y Nas daqG M 46.7 2 17.5% 12.8% -5.6% 52.7% 180.0% -36

G ree, Inc. J P Y T S E :3632 T S E 2,763.0 5,720.00 3. 8% 24.3% 19.2% 59.8% 112.6% -5.

G ungH o Online E nterta inment, Inc. J P Y 3765 OS E 311.5 252,000.00 60.0% 71.8% 9.6% 0.0% 155.8% -10

HanbitS oft, Inc. K R W A047080 K OS E 72.1 3,830.00 -4 .4% 4.4% -7.9% -18.1% 10.4% -42AC /InterActiveC orp. U S D IAC I Nas daqG S 2,733.1 20.71 4. 6% 6.6% 8.0% 28.8% 28.6% -2.

s eemedia Inc. C AD IE E T S XV 9. 2 0 0. 0% -5.1% 42.3% 117. 6% 184.6% -31

J umbuck E nte rta inment L imited AU D AS X:J MB AS X 13.5 0 3. 3% -6.1% -20.5% -20.5% -20.5% -38

K ings oft C o. Ltd. H K D 3888 S E H K 905.9 6 4. 6% 10.3% -7.1% 12.2% 130.1% -32

L ingo Media C orporation C AD T S XV :LM T S XV 11.2 0.95 0. 0% -1.0% -5.0% -20.8% -5. 0% -33

LookS mart, L td. U S D LOO K Nas daqG M 16.8 0.98 -5 .7% -8.3% -14.7% -18.2% -40.5% -45

Magnitude Informa tion S ystems Inc. U S D MAG Y OT C B B 8. 0 0.02 -5 .3% -5.3% 100.0% 93.5% -28.0% -53

Mixi, Inc. J P Y 2121 T S E 1,217.0 732,000.00 -5 .5% 4.6% 25.6% 28.9% 33.8% -15

Modern T imes G roup Mtg AB S E K MT G B OM 3,266.2 355.90 3. 7% 14.8% 19.4% 54.4% 103.4% -0.

MOK O.mobi Limited AU D MK B AS X 15.9 0.15 -9 .1% 25.0% 130.8% 114. 3% 200.0% -25

Multiplie d Media C orporation C AD T S XV :MMC T S XV 22.4 0.18 2. 9% 5.9% 33.3% 125. 0% 227.3% -23

Myriad G roup AG C HF MY R N S W X 205.8 4.85 1. 0% 0.0% 4.8% -2.8% -24.2% -24

NE OW IZ G ames C orporation K R W A095660 K OS E 734.8 40,550.00 2. 4% -4.0% -4.9% 25.5% 277.2% -9.

NetDra gon W ebS oft, Inc. H K D 777 S E H K 275.4 4.04 2. 0% -5.8% -19.8% -29.0% 40.3% -43

Neteas e. com Inc. U S D NT E S Nas daqG S 4,888.4 37.77 0. 2% -5.0% -14.0% 12.6% 82.6% -22

NeuL ion Incorporated C AD T S X:NLN T S X 74.0 0.67 1. 5% -8.2% -33.0% -8.2% 42.6% -48

NeXplore C orporation U S D NXP C OT C P K 31.2 0.56 -11.1% -24.3% -13.8% -20.0% -44.0% -44

Ngi G roup Inc. J P Y 2497 T S E 32.6 24,400.00 -6 .1% 9.9% 0.7% -32.2% -52.2% -59

Northgate T echnologies L imited INR 590057 B S E 20.2 27.05 -2 .0% -16.4% -35.4% -29.8% -59.4% -62

Open T ext C orp. U S D OT E X Nas daqG S 2,289.1 40.60 1. 1% 6.0% 9.4% 10.3% 28.8% -2.

Openwave S ys tems Inc. U S D OP W V Nas daqG S 193.1 2.31 -0 .3% -2.0% -7.9% 5.6% 235.1% -26

P erfect W orld C o. , L td. U S D P W R D Nas daqG S 1,980.3 39.80 -3 .1% -11.8% -11.5% 34.7% 121.6% -21

P NI Digita l Me dia Inc. C AD T S XV :P N T S XV 53.0 1.66 -2 .9% 0.6% -14.0% 10.7% 9. 2% -22

Quepa sa C orp. U S D QP S A OT C B B 25.5 2.00 -9 .1% 43.9% 25.0% 100. 0% 5. 3% -20

OAO R B C Informa tion S ystems U S D R B C I R T S 193.9 1.40 -12.7% -12.7% 20.5% 55.3% 179.5% -17S handa Interactive E nterta inment L td. U S D S N DA Nas daqG S 3,549.7 52.78 2. 3% -0.6% 9.8% -0.7% 57.7% -18

S hutterfly, Inc. U S D S F LY Nas daqG S 463.7 18.06 -0 .8% 20.4% 15.5% 33.8% 143.7% -4.

S K C ommunications C o. , Ltd. K R W A066270 K OS E 561.6 15,600.00 27.9% 106.9% 76.3% 58.4% 172.7% -4.

S NAP Intera ctive, Inc. U S D S T V I OT C B B 4. 1 0.38 26.7% 90.0% 8.6% -15.6% -45.7% -64

S ocia lwis e , Inc. U S D S C LW OT C B B 24.3 0.51 4. 1% 4.1% -16.4% -26.1% -38.6% -50

S ohu.com Inc. U S D S O HU Nas daqG S 2,209.9 57.46 1. 4% 2.1% -11.1% -5.2% 16.9% -20

S park N etworks , Inc. U S D LOV AME X 61.7 3.00 0. 0% 27.7% 34.5% 29.3% 17.6% -11

S pectrumDN A, Inc. U S D S P XA OT C B B 7. 6 0.16 3. 3% 10.7% 19.2% -46.6% 3. 3% -65

encent H oldings Ltd. H K D 700 S E H K 39,524.0 168.50 4. 3% 14.9% 37.1% 89.9% 221.6% -0.3%

e 9 L imited U S D NC T Y Nas daqG S 179.8 7.16 -1 .5% -7.9% -5.6% -24.4% -49.2% -57.0%

he S treet.com, Inc. U S D T S C M Nas daqG M 72.8 2.38 0. 8% 2.9% -18.8% 17.7% -30.7% -33.0

e .C om, Inc. U S D T R E E Nas daqG M 101.3 9.29 -0 .4% 46.1% 19.1% -1.8% 145.1% -28.9%

Unis erve C ommunica tions C orp. C AD T S XV :U S S T S XV 1. 4 0.06 50.0% 50.0% 50.0% -25.0% 50.0% -40

United Online Inc. U S D UN T D Nas daqG S 618.6 7.31 0. 9% 5.1% -5.2% 14.3% 24.4% -22

UOMO Media , Inc U S D UOMO OT C B B 3. 7 0.04 -16.0% -30.0% -65.3% -68.9% -58.0% -96

V alueC lick Inc. U S D V C LK Nas daqG S 869.9 10 2. 5% 5.6% -20.3% 1.9% 42.4% -27

V OIS , Inc. U S D V O IS OT C B B 11.9 0.01 0. 0% 0.0% 200.0% -16.7% 200.0% -47

W ebzen Inc. K R W K O S E :A069080 K OS E 114.1 11,200.00 -5 .9% 0.9% 6.7% -30.2% 153.1% -45

W izzard S oftware C orporation U S D W ZE AME X 18.2 0.34 -8 .1% -19.1% -26.1% -32.0% -64.2% -64

W orlds .com Inc. U S D W DDD OT C B B 4. 8 0.09 0. 0% -10.0% 0.0% -21.7% -55.0% -60

XING AG E U R O1B C XT R A 232.1 30.80 1. 8% -6.4% -13.2% 2.3% 13.2% -18

Y D Online C orp. K R W A052770 K OS E 94.8 7,350.00 6. 5% 20.1% -14.6% -18.2% 16.1% -40

Y nk K orea Inc. K R W A023770 K OS E 15.1 3,290.00 -1 .5% -11.0% -15.6% -52.2% -25.3% -62

High 60.0% 106.9% 200.0% 200. 0% 400.0% -0.

Low -44.4% -50.0% -85.2% -94.9% -98.4% -98Average 966.1 1.8% 3.8% 2.0% 8.5% 56.1% -37Median 0. 2% -0.3% -5.2% -3.2% 28.6% -33

gure 36. Price Performanceource. Capital IQ


24/31

Page

Comparable Company Analysis > Web 2.0aluation Multiples

ompany Name S ector Country

Primary

E xchange Ticker

USD Market

Cap ($m)

TEV/LTM

Revenue

TEV/ NTM

Revenue

TEV/LTM

EBITDA

TEV/NTM

E B ITDA P /LTM E P S P/NTM E P S P /Ta

ccelerize New Media , Inc. Direct Marketing U nited S tates OT C B B AC LZ 18. 7 5.7x - - - - -

ctoz S oft C o. , L td. G aming S outh K orea K OS E A052790 128. 8 0.7x - 3.4x - 17.9x - 1

Q Interactive, Inc. G aming J apan T S E 3838 40. 1 0.3x - 5.0x - - - 0

s knet AG G aming G ermany XT R A XT R A:A5A 21. 8 0.1x - - - - -

gs tring C orp. Ins ta nt Mes s aging U nited S tates OT C B B B S G C 1. 5 40.4x - - - - -

etawave C orporation Media U nited S tates OT C B B B W AV 3. 7 0.1x - - - - - 2

eyond C ommerce, Inc. S ocial Network ing U nited S tates OT C B B B Y O C 1. 2 1.0x - - - - -

right T hings plc S ocial Network ing U nited K ingdom AIM AIM:B G T 5. 6 - - - - - -

roadW ebAs ia Inc. S ocial Network ing U nited S tates OT C P K B W B A 4. 2 - - - - - -

DC C orp. G aming H ong K ong Nas daqG S C HIN.A 237. 5 0.6x 0.6x 10.3x 4.9x - - 10

hangyou.com L imited G aming C hina Nas daqG S C Y OU 1,838. 1 6.0x 5.0x 9.7x 7.7x 12.4x 10.9x 9

hinese G amer International G aming T aiwan G T S M G T S M:3083 1,107. 4 14.9x - 25.7x - 33.7x - 16

ornerW orld C orporation C ontent U nited S tates OT C B B C W R L 2. 9 1.9x - - - - -

yberplex Inc. Advertis ing C anada T S X T S X:C X 74. 6 0.5x 0.4x 4.5x 3.6x 6. 5x 6. 8x 2

ADA S pA S ocial Network ing Italy C M C M:DA 136. 8 0.8x - 6.0x - - -

XN Holdings B hd S ocial Network ing Ma lays ia K LS E DXN 36. 4 0.6x - - - 5. 3x - 0

igitalP os t Interactive , Inc. C ontent U nited S tates OT C B B DG L P 3. 9 5.1x - - - - -

igitalT own, Inc. S ocial Network ing U nited S tates OT C B B DG T W 32. 8 - - - - - -

olphin Digita l Media , Inc. S ocial Network ing U nited S tates OT C B B DP DM 11. 7 42.1x 0.8x - - - 0. 8x

olith C o. Ltd. G aming S outh K orea K OS E A041060 77. 9 13.2x - 27.7x - - - 0

xtens ions , Inc. C ontent U nited S tates OT C P K E XT I 13. 3 - - - - - -

uid Mus ic C anada, Inc. Media U nited S tates T S X T S X:F MN 104. 7 17.6x 17.6x - - - - 7

rogs ter Interactive P ictures AG G aming G ermany XT R A F R G 64. 1 6.7x - - - - - 8

amania Digita l E nterta inment C o. , L td. G aming T aiwan G T S M 6180 260. 7 1 .6x - 9.4x - 27.3x - 3

ameOn C o L td. G aming J apan T S E 3812 76. 7 0.0x - 0.2x - 8. 0x - 0

eoS entric Oyj Mobile F inland HLS E G E O1V 51. 3 12.0x - - - - -

iant Intera ctive G roup, Inc. G aming C hina NY S E G A 1,594. 3 - - - - 1. 7x 14.9x 0

igaMedia L td. G aming T aiwan Nas daqG S G IG M 178. 8 0.6x 1.1x - 22.6x 7. 1x - 1

ravity C o. , L td G aming S outh K orea Nas daqG M G R V Y 46. 7 - - - - 0. 0x - 0

ree, Inc. S ocial Network ing J apan T S E T S E :3632 2,763. 0 13.1x - 22.6x - 48.5x - 23

ungHo O nline E ntertainment, Inc. Media J apan OS E 3765 311. 5 2.3x - 10.5x - 60.6x - 9anbitS oft, Inc. G aming S outh K orea K OS E A047080 72. 1 1.0x - - - 70.0x - 2

AC /InterActiveC orp. Media U nited S tates Nas daqG S IAC I 2,733. 1 0.8x 0.8x 13.2x 5.6x 11.6x 30.4x 1

eemedia Inc. C ontent C anada T S XV IE E 9. 2 5.1x - - - - -

umbuck E nterta inment L imited S ocial Network ing Aus tra lia AS X AS X:J MB 13. 5 0.4x - 1.0x - 3. 8x - 1

ngsoft C o. L td. G aming C hina S E HK 3888 905. 9 6.0x - 14.9x - 19.9x - 4

ngo Media C orporation Learning C anada T S XV T S XV :L M 11. 2 8.1x - - - - -

ookS mart, Ltd. Direct Marketing U nited S tates Nas daqG M LOOK 16. 8 - - - - - - 0

agnitude Information S ys tems Inc. S ocial Network ing U nited S tates OT C B B MAG Y 8. 0 - - - - - -

ixi, Inc. S ocial Network ing J apan T S E 2121 1,217. 0 8.1x - 24.5x - 63.1x - 8

odern T imes G roup Mtg AB Media S weden OM MT G B 3,266. 2 2.0x - 13.8x - 18.1x -

OK O.mobi L imited S ocial Network ing Aus tra lia AS X MK B 15. 9 21.0x - - - - - 14

ultiplied Media C orporation Mobile C anada T S XV T S XV :MMC 22. 4 - 5.5x - - - - 16

yria d G roup AG Mobile S witzerland S W X MY R N 205. 8 3.2x - - - - -

E OW IZ G ames C orporation G aming S outh K orea K OS E A095660 734. 8 3 .4x - 12.7x - 37.3x - 18

etDragon W ebS oft, Inc. G aming C hina S E HK 777 275. 4 1.3x - 4.4x - 13.4x - 1

eteas e.com Inc. G aming C hina Nas daqG S NT E S 4,888. 4 - - - - 2. 6x 14.2x 0

euL ion Incorporated V ideo C anada T S X T S X:NLN 74. 0 2.4x - - - - - 10

eXplore C orporation C ontent U nited S tates OT C P K NXP C 31. 2 20.7x - - - - -

gi G roup Inc. Media J apan T S E 2497 32. 6 - - - - - - 0

orthgate T echnologies L imited Direct Marketing India B S E 590057 20. 2 0.4x - - - - -

pen T ext C orp. C ollabora tion C anada Nas daqG S OT E X 2,289. 1 2.9x 2.5x 11.2x 9.3x 49.9x 13.6x

penwa ve S ys tems Inc. Mobile U nited S tates Nas daqG S O P W V 193. 1 0.5x 0.5x 14.2x 4.4x - 32.6x 2

erfect W orld C o. , L td. G aming C hina Nas daqG S P W R D 1,980. 3 0.4x 1.9x 0.7x 3.7x 2. 4x 11.5x 1

NI Digita l Media Inc. Digita l Ima ging C anada T S XV T S XV :P N 53. 0 2 .2x 1.9x 12.8x 5.9x - 10.4x 11

uepas a C orp. S ocial Network ing U nited S tates OT C B B Q P S A 25. 5 - - - - - - AO R B C Information S ys tems Media R us s ia R T S R B C I 193. 9 0.0x - 0.3x - - -

handa Interactive E nterta inment Ltd. G aming C hina Nas daqG S S NDA 3,549. 7 - - - - 2. 3x 14.6x 0

hutterfly, Inc. Digita l Ima ging U nited S tates Nas daqG S S F LY 463. 7 1 .6x 1.5x 13.0x 8.0x - - 2

K C ommunications C o. , L td. S earch S outh K orea K OS E A066270 561. 6 2 .8x - 43.7x - - -

NAP Interactive, Inc. Da ting U nited S tates OT C B B S T V I 4. 1 0.8x - 4.8x - 22.8x - 2

ocialwise , Inc. S ocial Network ing U nited S tates OT C B B S C L W 24. 3 - - - - - -

ohu. com Inc. G aming C hina Nas daqG S S OHU 2,209. 9 3.3x 2.9x 7.6x 6.5x 13.5x 15.5x 4

park Networks , Inc. S ocial Network ing U nited S tates AME X LOV 61. 7 1.2x - 5.8x - 20.5x - 27

pectrumDNA, Inc. Media U nited S tates OT C B B S P XA 7. 6 - - - - - -

T encent Holdings L td. P orta l C hina S E HK 700 39,524. 0 27.4x - - - 68.6x -

T he9 L imited G aming C hina Nas daqG S NC T Y 179. 8 - - - - 2. 0x -

T heS treet. com, Inc. Media U nited S tates Nas daqG M T S C M 72. 8 0.1x 0.1x 4.2x - - -

T ree.C om, Inc. P orta l U nited S tates Nas daqG M T R E E 101. 3 0.3x 0.3x 7.8x 9.1x - -

nis erve C ommunications C orp. S ocial Network ing C anada T S XV T S XV :US S 1. 4 0.4x - 40.2x - - -

nited Online Inc. Media U nited S tates Nas daqG S UNT D 618. 6 0.9x 0.9x 4.1x 3.6x - 5. 6x

OMO Media , Inc Media C anada OT C B B UOMO 3. 7 5.2x - - - - -

a lueC lick Inc. Media U nited S tates Nas daqG S V C LK 869. 9 1.3x 1.4x 5.4x 5.3x - 16.5x 4

OIS , Inc. S ocial Network ing U nited S tates OT C B B V OIS 11. 9 - - - - - - 63

W ebzen Inc. G aming S outh K orea K OS E K OS E :A069080 114. 1 2.3x - 21.0x - 61.4x - 1

W izzard S oftware C orporation P odcas ting U nited S tates AME X W ZE 18. 2 3.8x - - - - -

W orlds .com Inc. C ontent U nited S tates OT C B B W DDD 4. 8 - - - - - -

NG AG S ocial Network ing G ermany XT R A O1B C 232. 1 2.9x - 10.8x - 31.4x - 6

D Online C orp. G aming S outh K orea K OS E A052770 94. 8 1.7x - 8.0x - 9. 8x - 2

nk K orea Inc. G aming S outh K orea K OS E A023770 15. 1 1.2x - 11.0x - - - 0

igh 39,524. 0 42.1x 17.6x 43.7x 22.6x 70.0x 32.6x 63ow 1. 2 0.0x 0.1x 0.2x 3.6x 0. 0x 0. 8x 0

verage 966.1 5.4x 2.5x 11.7x 7.2x 23.5x 14.2x 7edian 72. 4 1.9x 1.2x 10.0x 5.7x 15.7x 13.9x 2

gure 37. Valuation Comparisonource. Capital IQ


25/31


26/31

Page

in. Amount (Million) Type of financing Fin. Amount (Million) Type of financing

C ompany Name Acquis ition C ompany Name Angel/S eed

kype 2025. 0 MediaMath 16.6

layF ish 400.0 E do Interactive 16.5

ajah 207.0 K ontera Ltd. 15.5

Mint 170.0 B oku 13.0

hanghai Dacheng Network 80. 0 C aus es 10.0

eople Media 80. 0 Imeem 8. 8

uper R ewards 50. 0 S canS cout 8. 1

K u6 44. 0 S B Nation 8. 0

riends R eunited 42. 0 B ubble Motion 6. 0

AdL ink Internet Media 41. 2 T ongxue 6. 0

Grand Total 3139.2 G rand Total 108.4


C ompany Name Debt financing C ompany Name S eries A

One Net E ntertainment 10. 0 P laydom 43.0

T he R ubicon P roject 8.0 P opC ap G ames 22.5

T opsy 3.0 G OOM R adio 16.0

oomia 1.5 Marin S oftware 13.0

Myngle 1.3 gW allet 12.5

C ommunityLend 1.3 S uperS ecret 10.0

ros per. com 1.0 AdC hina 10.0

T ransG aming Inc. 0.5 Nurien 10.0

Grand Total 26.5 G o Internet Media 10.0

Intent Media 9. 0

InXpo 9. 0

G rand Total 165.0


C ompany Name S eries B C ompany Name S eries C

G roupon 30. 0 Zynga 180.0

mith & T inker 29. 0 P andora Media 35.0

ynthas ite 20. 0 C haC ha 30.0

K aixin001. com 20. 0 DailyMotion 25.3

C ollective Media 20. 0 S ezmi 25.0

As ter Data S ys tems 17. 0 T remor Media 20.0

ivebookings 16. 0 E ngine Y ard 19.0

Zynga 15. 0 L ithium 18.0

Offerpal Media 15. 0 S ugar Inc. 16.0

T umri 15. 0 Millennial Media 16.0

Grand Total 197.0 HubS pot 16.0

G rand Total 400.3


C ompany Name S eries D C ompany Name S eries E

acebook 200.0 T witter 100.0

T urbine 50. 0 E mergent G ame T echnolo 12.5

ockY ou 50. 0 G lam Media 10.0

Y ouku 40. 0 News G ator 10.0

T witter 35. 7 Mzinga 10.0

Zoosk 30. 0 G rand Total 142.5

ns equence 20. 0

Ning 15. 0

Zoove 13. 2

QuickP lay Media 12. 0

endMe Inc. 12. 0

Grand Total 477.9

Financing - 2009 (US$ mm) - Top Ten by Type

gure 40. Top 10 Deals, By Type, 2009ource. Company reports


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Page

Financ ing - 2009 (US$ m)

Fin. Amount (Million) Type of financing

Month C ompany Name Country Angel/S eed Debt financing PIPE S eries A S eries B S eries C S eries D S eries E G

Jan-09 ChaCha US A 30. 0

Aster Data Systems US A 17.0

Yodle US A 13. 0

AdMob US A 12. 5

VirtuOz F rance 11.4

IMVU US A 10. 0

NewsGator US A 10.0

DECA US A 10.0

Go Internet Media US A 10. 0

RatePoint US A 10. 0

Nurien K orea 10. 0

Limbo US A 9.0

One True Media US A 9.0

Play Hard Sports US A 8.0

SundaySky Is rael 8. 0

JibJab US A 7. 5

Xobni US A 7.0

Evernote US A 6. 5

InsideView US A 6.5

Kewego F rance 6. 2

Ohai US A 6. 0

Cloudera US A 6.0

Motionbox US A 6. 0

Fliqz US A 6. 0

SocialMedia US A 6. 0

Geni US A 5. 0

AboutUs US A 5. 0

Gbox US A 5. 0

Sportsblogs US A 5. 0

Scrapblog US A 4. 0

OneSeason.com US A 3. 5

E-Global Sports Network US A 3. 5

Tripwolf Austria 2. 5

mEgo US A 2. 5

Hubdub UK 1. 2

Snooth US A 1. 0

CoveritLive Ca nada 1. 0 TweetDeck UK 0. 5

BackType US A 0. 3

Identi.ca Ca nada 0. 2

Meez US A

J an-09 Total 9.5 66.2 74.9 112.2 9.0 10.0

Feb-09 Twitter 35. 7

Synthasite S outh Africa 20.0

Tremor Media US A 18. 0

Offerpal Media US A 15.0

Imagini UK 13.5

Emergent Game Technologies US A 12.5

Outbrain Is rael 12.0

Tvtrip F rance 9.0

Tongxue China 6. 0

Oodle US A 5. 6

Tributes.com US A 4. 3

TextDigger US A 4. 3

OneSpot US A 4. 2

FetchDog US A 4. 0

Mixpo Ca nada 4.0

Virtual Fairground Netherlands 4. 0

7 Billion People US A 3. 0

FamilyLink.com US A 2.9

WhistleBox US A 2. 3

MobGold China 2. 0

Mendeley UK 2. 0 Outright US A 2. 0

Tvinci Is rael 1. 6

Filtrbox US A 1. 4

MMO Life Netherlands 1. 3

Cake Financial US A 1. 3

Invodo US A 1. 2

fav.or.it UK 0. 7

F eb-09 Total 13.3 32.3 76.4 23.6 35.7 12.5

Mar-09 Kaixin001.com China 20.0

Vidyo US A 15. 0

Buzznet US A 12. 5

LendingClub US A 12.0

SendMe Inc. US A 12. 0

Auditude US A 10.5

Ngmoco United S tates 10.0

Glam Media US A 10.0

Visible Measures US A 10. 0

SuperSecret US A 10. 0

GoViral UK 8. 8

Greystripe US A 5. 5

Jajah Is rael 5.0

Cloudera US A 5. 0

OMGPOP US A 5.0

Apture US A 4. 1

Simulmedia US A 4. 0

Tynt Ca nada 3. 9

AnySource Media US A 3. 2

Pixazza US A 3. 1

Topsy US A 3. 0 Sports Composite DE US A 2.0

Bit.ly US A 2. 0

Hunch US A 2. 0

AdultSpace US A 1. 3

Myngle Netherlands 1. 3

33Across US A 0.8

Three Melons Argentina 0.6

Mar-09 Total 1.3 4.3 0.6 46.1 60.3 43.0 17.0 10.0


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Financing - 2009 (US$ m)

Fin. Amount (Million) Type of financing

Month Company Name Country Angel/S eed Debt financing PIPE S eries A S eries B S eries C S eries D Gra

Apr-09 Collective Media US A 20.0

GOOM Radio F rance 16.0

Marin Software US A 13.0

The R ubicon P roject US A 8.0 5.0

FreeWheel US A 12. 0

Cellufun US A 10.0

Conductor Inc.US A 10.0

ScanScout US A 8. 1

Batanga US A 7.5

Viximo US A 5. 0

DoubleTwist US A 5.0

IMShopping US A 4. 7

Booyah US A 4. 5

Socialtext US A 4.5

Mixercast US A 4. 1

SoundCloud G erma ny 3. 3

TubeMogul US A 3. 0

Tribal Nova C a nada 2.5

Tripbase US A 2. 0

Socialcast US A 1. 4

Brandtology S ingapore 1. 4

Scan & Target F rance 1. 3

Jodange US A 1. 2

Foodista US A 0. 6

Apr-09 Total 15.6 8.0 49.8 52.5 16.1 12.0

May-09 Facebook US A 200.0

One Net E ntertainment C hina 10.0 10.0

Cyberplex C a nada 12.9

Peer39 US A 10. 5

OpenX UK 10. 0

Intent Media US A 9. 0

Imeem US A 8. 8

EveryZing US A 8. 3

ConnectEdu US A 8.2

BlogHer Inc. US A 7. 0

WonderHill US A 7. 0

Gist US A 6. 8

Fuhu Inc. US A 6.3

Azuki Systems US A 6. 0

I Love Rewards C a nada 5.9

DocuSign US A 5.0

TimeBridge US A 5.0

OLX US A 5. 0

Medialets US A 4. 0

Cloud Engines US A 3. 3

Resonate Networks US A 2. 0

VoxPop US A 1.5

Mo'Minis Is ra el 1. 5

Loop'd Network US A 0. 8

May-09 Total 13.6 10.0 22.9 35.5 26.9 40.8 205.0

Jun-09 Sugar Inc. US A 16. 0

Tumri US A 15.0

Boku US A 13. 0

Wimba US A 12. 0

Grab Networks US A 12.0

AdChina C hina 10.0

Goojet SAS F rance 8.5

Edo Interactive US A 8. 0

AdMeld Inc. US A 8.0

beeTV US A 8.0

blueKiwi Software SA F rance 6.5

Nokeena US A 6.5

Bubble Motion US A 6. 0

Sense Networks US A 6.0

Zoosk US A 6. 0

Gather US A 5.3

MojoPages US A 5. 0

Taomee C hina 5. 0

Animoto US A 4.4

GameGround Is ra el 4. 1

RingRevenue US A 3. 5

Crowdcast US A 3. 0YuMe US A 2.9

eRepublik S pain 2. 8

Newser LLC US A 2. 5

ClickFuel US A 2. 5

Inigral US A 2. 4

AdEx Media US A 2.3

GROU.PS US A 2. 1

my6sense Is ra el 2. 0

Yapta US A 2.0

OneTXT US A 2. 0

I Love Rewards C a nada 1.8

Cliqset US A 1. 5

Picaboo US A 1.0

TodaCell Is ra el 1. 0

Glubble Netherla nds 1.0

AdWhirl US A 1. 0

LiquidPlanner US A 1. 0

MOG US A 0.5

MashLogic US A 0. 5

CommunityLend C a nada 0.3

OneForty US A 0. 2

J un-09 Total 50.6 0.3 15.3 28.5 71.2 34.0 5.3


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Financing - 2009 (US$ m)Fin. Amount (Million) Type of financing

Month C ompany Name C ountry Angel/S eed Debt financ ing S eries A S eries B S eries C S eries D S eries E G rand T otal

Jul-09 Pandora Media US A 35. 0 35. 0

Kontera Ltd. Is ra el 15. 5 15. 5

Ning US A 15. 0 1 5. 0

QuickPlay Media C a na da 12. 0 12. 0

Blekko US A 11. 5 11. 5

Causes US A 10. 0 10. 0

Outspark US A 8. 3 8.3

ConnectEdu US A 8. 2 8.2

Acquia, Inc US A 8. 0 8.0

SBNation US A 8. 0 8.0

MediaMath US A 6. 6 6.6

Metaversum G ermany 6. 3 6.3

iMemories US A 6. 2 6.2

Invodo US A 6. 0 6.0

Jambool US A 5. 0 5.0

Quikr India Pvt. Ltd. India 4. 1 4.1

ChaCha US A 4. 0 4.0

Nexage US A 4. 0 4.0

StyleCaster US A 4.0 4.0

OPEN S ports network US A 4. 0 4.0

TweetDeck UK 3. 2 3.2

Busca US A 2. 6 2. 6

ProtonMedia US A 2.5 2. 5

Akademos US A 2. 5 2. 5

iLoop Mobile US A 2. 0 2. 0

Comunitae S pa in 1. 7 1. 7

Lat49 C a na da 1.5 1. 5

Aloqa G ermany 1. 5 1. 5

Thread US A 1. 2 1. 2

Tributes.com US A 1. 2 1. 2

CoTweet US A 1.1 1. 1Cellufun US A 1. 0 1. 0

Cognitive Match Limited UK 1.0 1. 0

Clikthrough US A 1.0 1. 0

BookFresh US A 0. 5 0. 5

People Capital US A 0. 5 0. 5

Masher Media US A 0. 3 0. 3

J ul-09 Total 65.0 11.1 36.8 63.0 31.0 206.9

Aug-09 Turbine US A 50. 0 5 0. 0

Smith & Tinker US A 29. 0 29. 0

Mint US A 14. 1 14. 1

Zoove US A 13. 2 1 3. 2

RichRelevance US A 12. 5 12. 5

Traffiq US A 10. 0 10. 0

MediaMath US A 10. 0 10. 0

Bill.com US A 8. 5 8.5

Edo Interactive US A 8. 5 8.5

InnoCentive US A 7. 3 7.3

OneRiot US A 7. 0 7.0

Balihoo US A 7. 0 7.0

Boxee US A 6. 0 6.0

Polyvore US A 5. 6 5.6

Fanbase US A 5.0 5.0MOG US A 5. 0 5.0

OurStage US A 3. 0 3.0

Z2Live US A 3.0 3.0

KODA US A 3. 0 3.0

Scoreloop G ermany 2. 8 2.8

Roblox US A 2. 2 2.2

Tremor Media US A 2. 0 2. 0

iSocket US A 2.0 2. 0

RightsFlow US A 1.5 1. 5

Plista G ermany 1. 4 1. 4

C hessC ube S outh Africa 1. 3 1. 3

SC VNGR US A 0.8 0. 8

Linksify US A 0. 5 0. 5

iSyndica US A 0. 4 0. 4

DailyBooth US A 0. 0 0. 0

Aug-09 Total 25.8 12.3 77.6 43.6 63.2 222.4

Sep-09 Twitter 100. 0 100. 0

Ensequence US A 20. 0 2 0. 0

Livebookings UK 16. 0 16. 0

Mzinga US A 10. 0 10. 0

InXpo US A 9.0 9.0

Jobvite US A 8. 3 8.3

Riot Games US A 8. 0 8.0

NextBio US A 8. 0 8.0

Imeem US A 6. 0 6.0

Vuclip US A 6. 0 6.0

YuMe US A 5. 0 5.0

Booyah US A 5. 0 5.0

NeoEdge US A 4. 0 4.0

Alliance Health Networks US A 3. 3 3.3

Unisfair US A 3. 1 3.1

Conduit Labs US A 3. 0 3.0

Mocapay US A 3. 0 3.0

Fwix US A 2.8 2.8

Vantrix C a na da 2. 6 2.6

MashLogic US A 2.5 2.5

Greystripe US A 2. 0 2.0

Loomia US A 1.5 1.5

FourSquare US A 1.4 1. 4

EduFire US A 1.3 1. 3

Fluther US A 0. 6 0. 6

TransGaming Inc. C a na da 0.5 0. 5

OnLive US A

S ep-09 Total 0.6 2.0 16.9 52.3 27.9 23.1 110.0 232.8


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Page

inancing - 2009 (US$ m)n. Amount (Million) Type of financing

onth C ompany Name Country Angel/S eed Debt financ ing PIPE S eries A S eries B S eries C S eries D S eries E Grand T

ct-09 DailyMotion F rance 25. 3 25. 3

PopCap Games US A 22. 5 22. 5

Engine Yard US A 19. 0 19. 0

HubSpot US A 16. 0 16. 0

Jive Software US A 12. 0 12. 0

Spigit US A 10. 0 10. 0

Ooyala US A 10. 0 10. 0

ScanScout US A 8. 5 8. 5

Box.net US A 7. 1 7. 1

Reality Mobile US A 6. 5 6. 5

Watercooler US A 5. 5 5. 5

Vdopia US A 4. 7 4. 7

Sometrics US A 4. 0 4. 0

Amie Street US A 3. 9 3. 9

Aurora Feint US A 3. 7 3. 7

ViVu US A 3. 0 3. 0

Fizzback UK 2. 6 2. 6

Technorati US A 2. 0 2. 0

Onehub US A 1. 3 1. 3

DataSync US A 1. 2 1. 2

CommunityLend C ana da 1. 0 1. 0

Hot Potato US A 1. 0 1. 0

DailyBooth US A 1. 0 1. 0

Linkedex UK 1. 0 1. 0

StatusNet C ana da 0. 9 0. 9

IngBoo US A 0. 8 0. 8

Chango C ana da 0. 7 0. 7

Credit Karma US A 0. 5 0. 5

Listia US A 0. 4 0. 4

OneForty US A 0. 2 0. 2

c t-09 Total 4.7 1.0 44.6 56.5 67.4 2.0 176.1

ov-09 RockYou US A 50. 0 50. 0

Playdom US A 43. 0 43. 0

Sezmi US A 25. 0 25. 0

Millennial Media US A 16. 0 16. 0

Zynga US A 15. 0 15. 0

Evernote US A 10. 0 10. 0

CubeTree US A 8. 0 8. 0

Alice.com US A 6. 0 6. 0

Eventbrite US A 6. 0 6. 0

Placecast US A 5. 0 5. 0

AppNexus US A 5. 0 5. 0

Altruik US A 4. 7 4. 7

Credit Karma US A 2. 5 2. 5

Blekko US A 2. 5 2. 5

Playfire UK 2. 1 2. 1

SimpleGeo US A 1. 5 1. 5

Prosper.com US A 1. 0 1. 0

Adfonic UK 0. 6 0. 6

Scoopler US A 0. 5 0. 5

ov-09 Total 2.6 1.0 52.3 44.0 52.0 52.5 204.4

ec-09 Zynga US A 180. 0 180. 0

Youku C hina 40. 0 40. 0

Zoosk US A 30. 0 30. 0

Groupon US A 30. 0 30. 0

Lithium US A 18. 0 18. 0

gWallet US A 12. 5 12. 5

MobGold C hina 12. 0 12. 0

Movik Networks US A 8. 5 8. 5

Gowalla US A 8. 4 8. 4

Gogii US A 8. 2 8. 2

LiveMocha US A 8. 0 8. 0

SonicMule US A 8. 0 8. 0

kaChing US A 7. 5 7. 5

SeekingAlpha Is ra el 7. 0 7. 0

Pageonce US A 6. 5 6. 5

Genius.com US A 6. 5 6. 5

Curse US A 6. 0 6. 0

AlikeList US A 5. 0 5. 0

PowerReviews US A 4. 9 4. 9

Smaato US A 4. 5 4. 5

SCVNGR US A 4. 0 4. 0

Tonchidot J a pa n 4. 0 4. 0

Twilio US A 3. 7 3. 7

5 Minutes C hina 3. 5 3. 5

JanRain US A 3. 3 3. 3

StockTwits US A 3. 0 3. 0

Article One Partners US A 3. 0 3. 0

Whiskey Media US A 2. 5 2. 5

Appolicious US A 2. 4 2. 4

Grapeshot UK 2. 4 2. 4

Center'd US A 1. 9 1. 9

WePay US A 1. 7 1. 7

Jinni Is ra el 1. 6 1. 6

GlobalMotion Media US A 1. 0 1. 0

ec-09 Total 2.5 58.0 101.5 210.9 76.5 449.4

rand Total 205.1 26.5 38.8 453.5 730.6 734.4 532.3 142.5 2863.

gure 41. Financing, 2009 by Company, Country, Round, Monthource. Company reports


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Page

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