December 2012 Industry Update
Mark Watt +1 415 248 5910 [email protected]
James Hoak +1 415 248 5908 Internet & Digital [email protected] Media Insights
Overview, Analysis, and Trends in the Internet & Digital Media Industry William Blair
Table of Contents
William Blair Update ...... 1 IDM Intelligence ...... 2 Market Snapshot ...... 4 Recent Headlines in the Sector ...... 6 Public Comparable Companies ...... 8 Public Equity Market Overview ...... 10 Initial Public Offerings ...... 17 Financing Activity ...... 20 M&A Activity ...... 23 William Blair Internet & Digital Media Credentials ...... 25 William Blair Internet & Digital Media Team ...... 27 Disclosures ...... 28
Internet & Digital Media
Internet & Digital Media Table of Contents
William Blair
William Blair Update
Capital Markets U.S. capital markets remained steady in November 2012, with the Dow Jones, S&P 500, and Nasdaq all essentially even for the month.
While six IPOs successfully debuted on U.S. exchanges in November, there were no Internet and digital media (IDM) or technology issuers. In the follow‐on market, e‐commerce company Proto Labs, a technology‐enabled provider of injection‐molded custom parts, raised $128 million of primary and secondary capital; the company’s stock is currently up 17.7% since pricing the follow‐on. William Blair is pleased to have served as an underwriter on the transaction.
Several companies in the IDM sector continue to actively monitor the market for the opportune IPO window. Israel‐based public company Babylon, a global provider of language and search solutions, filed with the SEC to raise up to $115 million in its initial public offering on the Nasdaq Global Select Market. William Blair is pleased to serve as an underwriter on the proposed transaction. As of November 30, there were nine IDM IPOs on file with the SEC and a significant number of issuers in the shadow backlog as a result of JOBS Act confidential filings.
Private Financings There were 79 IDM private financings in November, totaling $624 million in disclosed transaction value(1). A selected list of transactions begins on page 20. Notable investments in the IDM sector in November include: • Evernote, a personal data and productivity application with over 45 million users, raised an $85 million round of funding led by AGC Equity Partners’ majority‐owned, mobile‐focused affiliate m8 Capital, with participation from Valiant Capital and T. Rowe Price. • HubSpot, an all‐in‐one inbound marketing software firm, raised a $35 million round of mezzanine financing led by a large, unnamed institutional investor, Altimeter Capital, Cross Creek Capital, Fidelity Investments, and others. • Zulily, a flash‐sales website targeted at busy moms and their kids, raised an $85 million Series D round led by new investor Andreessen Horowitz, with participation from existing investors Maveron, MeriTech Capital Partners, and others, at a valuation of $1 billion.
Mergers and Acquisitions There were 28 IDM M&A transactions in November, totaling $2.1 billion in disclosed transaction value(1). A selected list of transactions is on page 23. Notable M&A transactions in the IDM sector in November include: • Travel search engine Kayak was acquired by online travel site Priceline.com for $1.8 billion. Priceline will pay $40 per share for Kayak; about $500 million of the purchase price will be in cash and the other $1.3 billion in equity and stock options. • Coupon targeting company Incentive Targeting, which provides a technology that allows nontechnical marketing executives to design sophisticated promotions and measure ROI in real‐time, was acquired by Google. • Ziff Davis, a digital media technology company, was acquired by j2 Global, a provider of business cloud services, for about $175 million.
As always, we encourage you to contact us if we may be of assistance.
Best regards,
Mark Watt Head of Internet & Digital Media [email protected]
(1) Transactions included are limited to those with target companies that are based in either the United States or Canada.
Internet & Digital Media William Blair Update 1
William Blair
IDM Intelligence
December 2012: Evolving World of Commerce William Blair’s Internet & Digital Media team would like to introduce a new section of our monthly report, IDM Intelligence. IDM Intelligence will identify relevant topics from our conversations with key companies in the Internet & Digital Media industry, survey audience sentiment, and then present our results and findings. If you have suggestions for future topics, please let us know by replying to the report email. As we enter the holiday shopping season, this edition’s topic is the evolving world of commerce. With the introduction of new tools available to the consumer, the shopping experience has changed over recent years. Some of the catalysts behind this evolution include an increased trust in the online world, the introduction of mobile commerce, the smartphone research capabilities available to shoppers while in store, and review sites available online.
90% of our audience is In the past 3 months how many times have you using the Internet for purchased something online (not mobile)? shopping purposes
When identifying our audience, Never 13 Times 46 Times 7+ Times online purchasers are the clear 9.8% 46.7% 18.9% 24.6% majority. Over 90% of our audience is using the Internet for shopping purposes.
Which do you prefer, online shopping or shopping in a store? However, preferences indicate that Consumers consumers are not looking to abandon are not brick & mortar shopping. looking to About half still prefer shopping in a store. Online Shopping abandon This statistic holds true when filtering for 48.2% gender. brick & 51.8% Preferences aside, 61.6% of our audience Shopping in a mortar Store will conduct online research “most of the shopping time” or “all of the time” before making an in store purchase.
So why shop online? What factors go into why you shop online? (Please select all that apply) So what factors end up going into the decision to purchase online vs. shopping in a store? Price 100% Our audience weighted Price (less expensive options) and Discovery (I can browse and easily find what I want) as the most important factors that go 50% into their decision to shop online. Both of which were selected more than 70% of the time. Social 0% Discovery Reviews also played an important factor in decisions to shop online, with approximately half of respondents selecting that option. Women factored reviews into their rationale to shop online ~2x more than men. Meanwhile, our audience did not weigh social and the ability to share Reviews purchases with friends as an important factor in why they shop online.
Note: The data for this survey was collected using SurveyMonkey Audience.
Internet & Digital Media 2 IDM Intelligence
William Blair
Increased likelihood of As global mobile traffic is steadily increasing, mobile commerce is continuing to expand as using mobile to make well. Of the respondents who own a commerce‐enabled mobile device or tablet, our purchases in the next audience indicated they are more likely to make purchases through their mobile device in the next three months. three months
In the past three months how many times have In the next three months, how many times do you you purchased physical goods (not applications) anticipate purchasing physical goods (not applications) on your mobile device (tablet or smartphone)? on your mobile device (tablet or smartphone)?
Never Never Next Three 28% 40% 1‐3 Times Months 45% 1‐3 Times 50% 7+ Times Past Three 7% Months 4‐6 Times 4‐6 Times 7+ Times 15% 3% 12%
When it comes to what we shop for, the question remains, are we that different? What do you shop for online? (Please select all that apply)
Who we’re talking to this month:
Age Location (Census Region) Gender Education Household Income
West North $25,000 < 18 Less than Central Mountai n $49,999 0% high school 5% 4% degree 12% East South 3% Central 1829 7% Pacific Associate 20% High school 4560 23% or bachelor $0 $50,000 34% degree $99,999 Mal e degree $24,999 16% 47% 34% 15% 36% West South East North Female Graduate > 60 Central $100,000 Central 53% degree 22% 7% $149,999 16% 23% Some 17% 3044 col l e g e $150,000+ Ne w 24% 24% 20% England 9% South Mi ddl e Atl anti c Atl anti c 14% 15% Note: The data for this survey was collected using SurveyMonkey Audience.
Internet & Digital Media IDM Intelligence 3
William Blair
Market Snapshot
Economic Indicators
Economic Indicators 2009 2010 2011 2012 YTD(1) NASDAQ (yr. end) 2,269 2,653 2,605 3,012 Dow Jones Industrial Average (yr. end) 10,428 11,578 12,218 13,022 USD / Euro Exchange Rate (ann. avg.) 1.39 1.33 1.39 1.28 Federal Funds Rate (ann. avg. %) 0.16 0.18 0.10 0.14 U.S. Inflation Rate (yoy, ann. avg. %) (0.3) 1.6 3.2 2.2 3‐Month LIBOR (ann. avg. %) 0.686 0.344 0.337 0.441 U.S. 10 Year Treasury Bond (ann. avg. %) 3.26 3.22 2.78 1.79 U.S. GDP Growth (yoy, ann. avg. %) (2.6) 2.9 1.6 2.4 U.S. Unemployment Rate (ann. avg. %) 9.3 9.6 9.0 8.1 Consumer Confidence (ann. avg.) 45.2 54.5 58.1 67.3 Sources: NASDAQ, Dow Jones, S&P, Federal Reserve, Bureau of Labor Statistics, Census Bureau, Bureau of Economic Analysis, Conference Board, and The Wall Street Journal (1) As of November 30, 2012
All Sectors
Number of Total Global Transactions 2009 2010 2011 2012 YTD(1) Total M&A – Announced 36,416 39,986 39,171 37,659 Total Private Placements 18,792 26,725 26,712 23,381 Total PIPES 2,628 3,585 2,865 2,322 Total IPO Filings 81 181 195 85 Total IPO Pricings 52 117 104 108 Total Follow‐On Filings 758 659 474 486 Total Follow‐On Pricings 687 587 412 425 Sources: Dealogic, Capital IQ, and Placement Tracker (1) As of November 30, 2012
Internet & Digital Media 4 Market Snapshot
William Blair
Technology
Number of U.S. Technology Transactions 2009 2010 2011 2012 YTD(1) Technology M&A – Announced 1,637 2,173 2,199 2,041 Technology Private Placements 2,648 3,376 4,019 3,558 Technology PIPES 148 189 91 67 Technology IPO Filings 28 65 78 32 Technology IPO Pricings 174344 42 Technology Follow‐On Filings 67 72 70 59 Technology Follow‐On Pricings 64 68 62 53
Internet & Digital Media
Number of U.S. Internet & Digital Media Transactions 2009 2010 2011 2012 YTD(1) Internet & Digital Media M&A – Announced 287 492 378 309 Internet & Digital Media Private Placements 498 809 1,175 1,228 Internet & Digital Media PIPES 28 55 50 32 Internet & Digital Media IPO Filings 6 11 14 9 Internet & Digital Media IPO Pricings 3 7 20 13 Internet & Digital Media Follow‐On Filings 2 5 8 6 Internet & Digital Media Follow‐On Pricings 2 5 7 4
Internet & Digital Media Median Multiples
Median 12/31/2008 12/31/2009 12/31/2010 12/31/2011 2012 YTD(1) Forward CY EV/Revenue 1.2x 1.8x 2.1x 1.8x 1.6x Forward CY EV/EBITDA 6.1x 8.9x 9.0x 7.7x 7.7x Forward CY P/E 14.3x 21.1x 20.8x 17.7x 16.4x Forward CY PEG 1.0x 1.3x 1.1x 0.9x 0.8x Sources: Capital IQ, FactSet Research Systems, and Placement Tracker (1) As of November 30, 2012
Internet & Digital Media Market Snapshot 5
William Blair
Recent Headlines in the Sector
Selected Internet & Digital Media News
Date Headlines 11/30/12 User‐generated content company Wikia raised a $10.8 million Series C round led by Institutional Venture Partners, with participation from existing investors Bessemer Ventures Partners and Amazon.com.
11/30/12 Evernote, a personal data and productivity application with over 45 million users, raised an $85 million round of funding led by AGC Equity Partners’ majority‐owned, mobile‐focused affiliate m8 Capital, with participation from Valiant Capital and T. Rowe Price.
11/30/12 Montreal‐based Cinemagram, a mobile application providing a cinemagraph generator, or a social reader for GIFs, raised an $8.5 million Series A round from Menlo Ventures, Khosla Ventures, Real Ventures, and Atlas Venture.
11/30/12 New York‐based start‐up NoMoreRack, a flash sales site that offers everyday products at reduced prices, raised a $12 million Series A round led by eBay’s G‐Market, a Seoul‐based e‐commerce giant, with several others participating.
11/30/12 Rent The Runway, which allows women to rent designer clothes and accessories at a marked down price, raised a $20 million round of funding led by Condé Nast Publications, with all existing investors participating, including Highland Capital Partners and Kleiner Perkins Caufield & Byers.
11/29/12 Israel‐based Everything.me, an HTML5‐based mobile application platform, raised a $25 million Series C round led by Telefónica Digital, with participation from Mozilla Corporation, SingTel Innov8, Horizons Ventures, Draper Fisher Jurvetson, BRM Group, and Tamir Fishman Ventures.
11/28/12 Coupon targeting company Incentive Targeting, which provides a technology that allows nontechnical marketing executives to design sophisticated promotions and measure ROI in real‐time, was acquired by Google.
11/21/12 Toronto‐based Chango, an online advertising and marketing company, raised a $12 million round of funding led by existing investors iNovia Capital, Mantella Venture Partners, Metamorphic Ventures, Extreme Venture Partners, and Rho Capital Partners.
11/20/12 Kaltura, an open‐source video platform, raised a $25 million Series D round led by new investors Mitsui & Co. Global Investment and ORIX Ventures, with participation from existing investors Nexus Venture Partners, Intel Capital, .406 Ventures, and Avalon Ventures.
11/19/12 GetGlue, a social television application maker, was acquired by Viggle, a television loyalty service, for $25 million in cash and 48.3 million shares of stock for a total purchase price of about $78.6 million.
11/19/12 San Francisco‐based O’Reilly AlphaTech Ventures, a venture capital firm specializing in seed stage investments, raised $85 million for its third and largest fund to date, OATV Fund III.
11/16/12 U.K.‐based Outplay Entertainment, which develops and publishes games for social networks and connected mobile platforms, raised a $4 million round of funding from existing investors Pentech Ventures and The Scottish Investment Bank.
11/15/12 Zulily, a flash‐sales website targeted at busy moms and their kids, raised an $85 million Series D round led by new investor Andreessen Horowitz, with participation from existing investors Maveron, MeriTech Capital Partners and others, at a valuation of $1 billion.
11/15/12 E‐commerce company Proto Labs, a technology‐enabled provider of injection‐molded custom parts, raised $128 million in a follow‐on offering; William Blair is pleased to have served as an underwriter on the transaction.
11/15/12 This Technology, a provider of software solutions for dynamic video advertising insertion (DAI), raised a $7.5 million Series A round led by General Catalyst Partners.
11/15/12 Vuclip, a mobile video and media company, raised a $13 million Series D round led by SingTel Innov8, with participation from existing investors New Enterprise Associates and JAFCO Ventures.
11/15/12 U.K.‐based content marketing agency Quaturo, which specializes in producing outstanding content to get noticed online, was acquired by online marketing agency BlueGlass Interactive.
11/14/12 London‐based Base79, an online video company and YouTube network, raised an undisclosed amount in a round of funding led by The Chernin Group, with existing investor MMC Ventures participating.
11/14/12 Billtrust, which offers paper and electronic billing solutions, raised a $25 million Series B round from Bain Capital Ventures.
11/14/12 PlayHaven, a provider of relationship management and monetization solutions for mobile game developers, raised an $8 million round of funding led by GGV Capital, with participation from existing investors e.ventures, Tandem Entrepreneurs, and several private investors.
11/13/12 Paris‐based LeKiosk, a 3‐D digital newsstand for iOS, Android, and Web applications, raised a $7.1 million Series B round from CDC Entreprises and CM‐ CIC Capital Privé.
11/13/12 Online entertainment company Fertitta Interactive, whose Ultimate Gaming launched its free‐play site on Facebook earlier this year and expects a money site to launch in Nevada by June 30, 2013, sold a 51% stake to Station Casinos, a provider of gaming and entertainment in Las Vegas, Nevada.
11/13/12 Retrofit, an expert‐led, data‐driven weight loss program for busy professionals, raised an $8 million Series A round led by Draper Fisher Jurvetson, with participation from Correlation Ventures, Hyde Park Angels, I2A Fund, New World Ventures, and others.
11/13/12 Buenos Aires‐based Navent, an online real estate and jobs classifieds company, raised a $30 million Series B round from Riverwood Capital and Tiger Global Management.
Internet & Digital Media 6 Market Snapshot
William Blair
Selected Internet & Digital Media News (cont’d)
Date Headlines 11/13/12 DogVacay, an online marketplace that connects dog owners in need of pet‐care services and boarding with qualified pet caregivers and homes, raised a $6 million Series A round from Benchmark Capital.
11/13/12 The Associated Press’s iCircular, a technology that puts coupons, advertisements, and offers into the mobile sites of newspapers, was acquired by Wanderful Media, a digital local discovery shopping company.
11/13/12 Ziff Davis, a digital media technology company, was acquired by j2 Global, a provider of business cloud services, for about $175 million.
11/12/12 Israel‐based LiveU, a provider of video transmission technology that works over cellular and Wi‐Fi networks, raised a $27 million round of funding led by Lightspeed Venture Partners, with participation from Canaan Partners, Carmel Ventures, and Pitango Venture Capital.
11/12/12 U.K.‐based Spotify, a streaming and music on‐demand service, raised a $100 million round of funding at a valuation of about $3 billion; investors included Coca‐Cola, Goldman Sachs, Fidelity Investments, and others existing investors.
11/9/12 ToyTalk, an artificial intelligence technology for the iPad that uses an educational stuffed bear speaking to children, raised an $11.5 million Series A round from Charles Rivers Ventures.
11/9/12 November Software, a game studio working on a mobile title called Battlestone, was acquired by social gaming giant Zynga.
11/8/12 Travel search engine Kayak was acquired by online travel site Priceline.com for $1.8 billion. Priceline will pay $40 per share for Kayak; about $500 million of the purchase price will be in cash and the other $1.3 billion in equity and stock options.
11/8/12 Local commerce marketplace Groupon reported third quarter 2012 results, generating revenue of $568.6 million, up 32% from $430.2 million in the year‐ago period; the company posted a $1.6 million net loss, compared with a $10.6 million net loss in the year‐ago period.
11/8/12 Google increased the amount of money it makes available through its venture capital arm, Google Ventures, from $200 million per year to $300 million; the additional $100 million will allow Google Ventures to participate in more later‐stage financing rounds.
11/8/12 Real estate information marketplace Trulia reported third quarter 2012 results in its first report since going public, generating revenue of $18.5 million, up 76% year‐over‐year from $10.5 million; the company posted a $1.7 million net loss, compared with a $1.5 million net loss in the year‐ago period.
11/8/12 Ontario‐based YourCityDeals, a website offering daily deals at places to eat, exercise, shop, and relax, raised a $50 million round of funding from an undisclosed investor.
11/7/12 Diversified media company News Corp acquired 49% of Yankees Entertainment & Sports Network (YES Network), a sports and entertainment television network dedicated to the New York Yankees and Brooklyn Nets.
11/6/12 Berlin‐based Trademob, a mobile application marketing platform, raised a $15 million Series B round led by new investor Kennet Partners, with participation from existing investors Tengelmann Ventures and High‐Tech Gründerfonds Management.
11/5/12 E‐commerce advertising network Longboard Media was acquired by social commerce solutions provider Bazaarvoice for $44.2 million.
11/5/12 Israel‐based Kenshoo, a search and social marketing company, raised a $12 million round of funding led by Tenaya Capital, with participation from existing investors Sequoia Capital and Arts Alliance.
11/5/12 Real estate information marketplace Zillow reported third quarter 2012 results, generating revenue of $31.9 million, up 67% from $19.1 million in the year‐ago period; the company posted profits of $2.3 million, up from a loss of $0.6 million in the year‐ago period.
11/5/12 HubSpot, an all‐in‐one inbound marketing software firm, raised a $35 million round of mezzanine financing led by a large, unnamed institutional investor, Altimeter Capital, Cross Creek Capital, Fidelity Investments, and others.
11/2/12 Israel‐based public company Babylon, a global provider of language and search solutions, filed with the SEC to raise up to $115 million in its initial public offering on the Nasdaq Global Select Market. William Blair is pleased to serve as an underwriter on the proposed transaction.
11/2/12 Mobile analytics and advertising company Flurry raised a $25 million Series D round led by Crosslink Capital, with participation from Draper Fisher Jurvetson, First Round Capital, InterWest Partners, Menlo Ventures, and Union Square Ventures.
11/2/12 Beijing‐based iQIYI.com, the first online video platform in China to focus exclusively on fully licensed, high‐definition and professionally produced content, was acquired by Chinese search company Baidu.
11/2/12 New York‐based RRE Ventures raised $230 million for its fifth fund; the early‐stage venture capital firm focuses on consumer and media sectors, mobile technology, enterprise technology, as well as financial and green technology.
11/1/12 Online recommendation company Yelp reported third quarter 2012 results, generating revenue of $36.4 million, up 63% from $22.3 million in the year‐ ago period; the company posted a net loss of $2 million, compared with a net loss of $3.8 million in the year‐ago period.
11/1/12 Dollar Shave Club, which sells shaving razors and other grooming supplies online, raised a $9.8 million Series A round led by new investor Venrock, with participation from existing investors Kleiner Perkins Caufield Byers, Andreessen Horowitz, Shasta Ventures, Felicis Ventures, and others.
11/1/12 Online professional network LinkedIn reported third quarter 2012 results, generating revenue of $252 million, up 81% from $140 million in the year‐ ago period; the company posted profits of $2.3 million, compared with a net loss of $1.6 million in the year‐ago period.
Internet & Digital Media Market Snapshot 7
William Blair
Public Comparable Companies
Summary of Public Comparables
Current Stock Price as a (CY '13E) % of 52 Week Ent. Value / Sales Ent. Value / EBITDA P/E Ratio PEG Category High Low 2012E 2013E 2012E 2013E 2012E 2013E Ratio E‐commerce / Marketplaces (1) 74.1% 145.7% 3.2x 2.8x 13.1x 10.8x 28.9x 23.0x 1.4x E‐retail (2) 74.4% 166.3% 1.0 0.8 9.5 7.8 24.4 18.4 1.5 Ad Tech (3) 64.6% 135.2% 1.8 1.5 7.3 6.3 16.7 14.3 1.2 Content (4) 72.1% 155.5% 3.2 2.6 9.9 8.5 24.6 19.8 1.0 Social (5) 54.8% 173.2% 8.8 9.0 27.9 24.9 54.5 43.5 1.4 Digital Media (6) 53.0% 128.5% 2.2 1.7 32.3 23.9 nmf nmf na Digital Media Infrastructure (7) 60.9% 126.0% 2.5 2.2 8.7 6.3 16.8 14.2 1.1 Gaming (8) 51.5% 134.8% 0.7 0.7 8.4 5.2 9.5 8.5 0.8 Web Services (9) 64.6% 165.7% 1.8 1.5 8.2 6.4 22.3 16.9 1.1 Mobile (10) 50.4% 144.1% 1.9 1.4 5.3 4.6 9.2 8.3 0.7 Traditional Media (11) 85.8% 146.3% 2.1 2.0 7.6 7.2 15.5 13.8 1.1 Consumer Electronics (12) 62.6% 133.0% 0.6 0.6 5.9 5.3 10.6 9.3 nmf Selected Europe & Latin America 77.7% 142.1% 2.8 2.4 9.7 7.8 17.2 13.5 1.0 Selected Asia 67.3% 136.6% 3.2 2.5 10.1 8.3 19.1 17.3 1.0 Sources: Capital IQ and FactSet Research Systems as of November 30, 2012 (1) E‐commerce/Marketplaces: P/E ratio metrics exclude Zipcar (2) E‐retail: EBITDA metrics exclude Amazon and Coastal Contacts; P/E ratio metrics exclude Amazon, Coastal Contacts, and Shutterfly (3) AdTech: P/E ratio metrics exclude ReachLocal (4) Content: EBITDA and P/E ratio metrics exclude Yelp, Zillow, and Trulia (5) Social: P/E ratio metrics exclude LinkedIn (6) Digital Media: EBITDA metrics exclude Pandora Media; P/E metrics exclude RealNetworks (7) Digital Media Infrastructure: EBITDA metrics exclude TiVo and Envivio; P/E ratio metrics exclude Envivio (8) Gaming: EBITDA metrics exclude THQ; P/E ratio metrics exclude Zynga (9) Web Services; EBITDA metrics exclude Market Leader (10) Mobile: EBITDA and P/E ratio metrics exclude Millennial Media and Glu Mobile; P/E ratio metrics exclude TeleCommunication Systems (11) Traditional Media: EBITDA metrics exclude Naspers; P/E metrics exclude Washington Post (12) Consumer Electronics: EBITDA metrics exclude Nokia; P/E metrics exclude Sony and Acer
Internet & Digital Media 8 Market Snapshot
William Blair
Indexed Stock Performance – Last 12 Months
180
160
140
120
100
80
60 11/30/11 01/31/12 03/31/12 05/31/12 07/31/12 09/30/12 11/30/12
E‐commerce / Marketplaces (+40.1%) E‐retail (+29.8%) Ad Tech (+9.1%) Content (+18.3%) Social (+17.0%) Digital Media (+12.5%) Digital Media Infrastructure (+10.8%) Gaming (‐25.9%) Web Services (‐23.2%) Mobile (‐2.0%) Traditional Media (+40.5%) Consumer Electronics (+28.3%) Selected Asia (+0.1%) Selected Europe & Latin America (+13.7%) NASDAQ (+14.9%)
Source: FactSet Research Systems as of November 30, 2012
Internet & Digital Media Market Snapshot 9
William Blair
Public Equity Market Overview
Ecommerce/Marketplaces
Stock Equity Enterprise (CY '13E) Price Value Value Ent. Value / Sales Ent. Value / EBITDA P/E Ratio PEG Company 11/30/12 ($ MM) ($ MM) 2012E 2013E 2012E 2013E 2012E 2013E Ratio eBay $52.82 $68,348.3 $63,731.3 4.5x 3.9x 13.7x 11.8x 22.5x 19.3x 1.5x priceline.com 663.19 33,070.0 29,987.0 5.7 4.8 15.3 12.5 21.4 17.6 1.0 Expedia 61.86 8,342.9 7,342.4 1.8 1.6 9.4 8.1 19.9 17.0 1.3 Groupon 4.15 2,717.9 2,095.8 0.9 0.8 7.6 8.2 24.1 17.5 0.6 HomeAway 20.48 1,701.8 1,457.6 5.2 4.3 18.2 14.6 43.9 31.0 1.1 Kayak 40.70 1,569.4 1,391.6 4.7 3.8 19.2 14.4 47.2 36.7 1.4 Liquidity Services 41.06 1,291.5 1,228.7 2.4 2.0 10.7 9.0 21.2 18.0 0.6 OpenTable 44.89 1,020.0 933.9 5.8 5.0 13.4 11.5 27.0 23.5 1.0 NIC 15.01 970.1 897.0 4.3 3.8 17.9 14.6 40.3 32.5 2.0 Proto Labs 36.48 890.2 832.9 6.7 5.4 19.6 15.4 36.0 29.1 1.0 Monster Worldwide 5.44 637.0 657.9 0.7 0.8 4.4 3.9 18.2 11.9 1.0 eHealth 25.80 522.5 391.7 2.5 2.3 18.7 15.1 71.8 54.2 5.4 Dice Holdings 8.60 512.8 504.8 2.7 2.5 6.6 6.0 14.7 13.4 0.8 Zipcar 8.13 325.7 395.5 1.4 1.3 24.2 17.8 nmf 45.2 na Travelzoo 17.56 277.5 219.5 1.5 1.4 6.7 6.8 13.4 14.3 na Orbitz Worldwide 2.31 242.7 530.8 0.7 0.7 4.2 4.0 11.6 9.3 na Mean(1) 3.2x 2.8x 13.1x 10.8x 28.9x 23.0x 1.4x Median(1) 2.6x 2.4x 13.5x 11.7x 22.5x 18.0x 1.0x
Ad Tech
Stock Equity Enterprise (CY '13E) Price Value Value Ent. Value / Sales Ent. Value / EBITDA P/E Ratio PEG Company 11/30/12 ($ MM) ($ MM) 2012E 2013E 2012E 2013E 2012E 2013E Ratio Google $698.37 $229,480.3 $192,756.3 4.6x 3.7x 10.4x 8.9x 17.5x 15.0x 1.1x Microsoft 26.62 224,004.1 170,306.1 2.2 2.0 5.3 4.9 9.4 8.7 1.0 ValueClick 18.87 1,419.8 1,474.5 2.2 2.0 6.9 6.1 15.6 13.5 1.1 Bazaarvoice 9.78 675.4 533.8 3.7 2.8 nmf nmf nmf nmf na Blucora 14.75 601.0 524.9 1.3 1.1 6.3 5.2 12.5 10.2 0.5 comScore 13.31 474.2 432.3 1.7 1.5 10.0 8.9 17.1 14.8 1.1 Constant Contact 13.32 406.9 318.7 1.3 1.1 8.7 7.1 24.0 19.4 0.8 Responsys 6.52 318.1 218.5 1.4 1.2 8.7 7.3 32.4 28.3 1.3 ReachLocal 10.96 312.5 216.8 0.5 0.4 9.3 7.2 nmf 94.6 4.7 QuinStreet 6.25 267.3 266.5 0.8 0.8 4.1 4.6 8.2 8.9 0.6 Marchex 4.16 154.1 118.6 0.9 0.8 6.7 6.3 17.2 15.6 na Acquity Group 6.27 147.4 116.7 0.8 0.6 3.9 3.0 12.7 8.4 0.3 Lyris 2.30 21.9 27.3 na na na na na na na Mean(2) 1.8x 1.5x 7.3x 6.3x 16.7x 14.3x 1.2x Median(2) 1.3x 1.1x 6.9x 6.3x 16.3x 14.2x 1.0x Sources: Capital IQ and FactSet Research Systems as of November 30, 2012 (1) P/E ratio metrics exclude Zipcar (2) P/E ratio metrics exclude ReachLocal
Internet & Digital Media 10 Public Equity Market Overview
William Blair
Eretail
Stock Equity Enterprise (CY '13E) Price Value Value Ent. Value / Sales Ent. Value / EBITDA P/E Ratio PEG Company 11/30/12 ($ MM) ($ MM) 2012E 2013E 2012E 2013E 2012E 2013E Ratio Amazon.com $252.05 $114,168.3 $108,920.3 1.8x 1.4x 31.5x 24.6x nmf nmf na HSN 52.89 2,869.4 2,989.5 0.9 0.9 9.2 8.5 19.9 16.3 1.0 Vistaprint 31.05 1,063.8 1,263.8 1.1 1.0 9.2 8.4 16.8 15.5 0.9 Shutterfly 26.95 975.1 885.1 1.5 1.3 8.7 6.8 nmf 57.8 2.6 United Online 5.72 520.4 656.2 0.8 0.8 4.9 5.0 8.6 9.2 na Blue Nile 39.34 491.7 462.1 1.1 1.0 21.6 17.6 55.2 41.4 2.6 Stamps.com 25.37 395.9 358.8 3.1 2.7 12.2 10.3 15.2 12.9 na Overstock.com 15.17 355.7 300.2 0.3 0.3 9.5 7.5 26.6 18.4 0.9 PetMed Express 11.54 222.1 159.7 0.7 0.7 6.0 6.0 14.8 14.7 2.9 1‐800‐Flowers.com 3.13 203.1 259.8 0.4 0.3 5.7 5.0 16.3 12.2 0.8 Coastal Contacts 5.54 158.9 149.9 0.7 0.7 nmf nmf nmf nmf na Geeknet 17.13 112.2 74.2 0.6 0.5 17.7 10.2 56.2 30.6 na CafePress 5.83 99.8 47.4 0.2 0.2 2.9 2.5 14.1 12.6 0.5 U.S. Auto Parts Network 1.94 60.4 76.5 0.2 0.3 6.3 5.6 nmf nmf na BIDZ.com 0.65 11.9 8.9 na na na na na na na Ediets.com 0.47 6.7 8.4 na na na na na na na Mean(1) 1.0x 0.8x 9.5x 7.8x 24.4x 18.4x 1.5x Median(1) 0.8x 0.7x 8.9x 7.2x 16.6x 15.1x 1.0x
Social
Stock Equity Enterprise (CY '13E) Price Value Value Ent. Value / Sales Ent. Value / EBITDA P/E Ratio PEG Company 11/30/12 ($ MM) ($ MM) 2012E 2013E 2012E 2013E 2012E 2013E Ratio Facebook $28.00 $76,812.2 $67,262.2 13.4x 10.4x 24.1x 18.7x 54.5x 43.5x 1.6x LinkedIn 108.14 11,619.5 10,942.8 11.6 7.6 53.1 31.1 nmf 84.5 1.3 MeetMe 3.51 129.9 136.2 na na na na nmf nmf na FriendFinder Networks 0.65 20.7 485.8 1.5 na 6.4 na nmf na na Mean(2) 8.8x 9.0x 27.9x 24.9x 54.5x 43.5x 1.4x Median(2) 11.6x 9.0x 24.1x 24.9x 54.5x 43.5x 1.4x
Digital Media
Stock Equity Enterprise (CY '13E) Price Value Value Ent. Value / Sales Ent. Value / EBITDA P/E Ratio PEG Company 11/30/12 ($ MM) ($ MM) 2012E 2013E 2012E 2013E 2012E 2013E Ratio Netflix $81.71 $4,538.6 $4,140.3 1.1x 1.0x 32.3x 23.9x nmf nmf na Pandora Media 8.72 1,472.6 1,390.3 3.3 2.3 nmf 63.8 nmf nmf na RealNetworks 7.27 256.2 (17.6) nmf nmf na na 7.1 nmf na Mean(3) 2.2x 1.7x 32.3x 23.9x nmf nmf na Median(3) 2.2x 1.7x 32.3x 23.9x nmf nmf na Sources: Capital IQ and FactSet Research Systems as of November 30, 2012 (1) EBITDA metrics exclude Amazon and Coastal Contacts; P/E ratio metrics exclude Amazon, Coastal Contacts, and Shutterfly (2) P/E ratio metrics exclude LinkedIn (3) EBITDA metrics exclude Pandora Media; P/E metrics exclude RealNetworks
Internet & Digital Media Public Equity Market Overview 11
William Blair
Content
Stock Equity Enterprise (CY '13E) Price Value Value Ent. Value / Sales Ent. Value / EBITDA P/E Ratio PEG Company 11/30/12 ($ MM) ($ MM) 2012E 2013E 2012E 2013E 2012E 2013E Ratio Yahoo! $18.77 $22,199.1 $13,868.1 3.1x 3.0x 8.8x 8.2x 16.6x 16.9x1.4x TripAdvisor 38.19 5,436.1 5,316.9 7.0 5.9 15.1 12.7 25.0 20.9 1.4 IAC/InterActiveCorp 47.15 4,170.7 3,737.0 1.3 1.1 7.6 5.9 16.7 12.5 0.5 AOL 37.52 3,140.3 2,397.2 1.1 1.1 5.7 5.8 26.4 19.8 0.1 Ancestry.com 31.60 1,368.7 1,359.1 2.8 2.5 8.0 7.0 18.5 16.3 1.6 Bankrate 12.03 1,203.6 1,326.3 2.8 2.6 10.1 9.1 19.9 17.1 0.8 Yelp 18.91 1,197.0 1,073.9 7.9 5.2 nmf 52.2 nmf nmf na Zillow 27.52 920.1 691.2 6.1 4.3 32.4 20.4 91.5 51.9 0.7 Shutterstock 25.60 857.9 803.6 4.9 3.9 25.4 18.1 30.7 39.0 1.9 Demand Media 8.90 758.1 645.2 1.8 1.5 6.3 5.3 23.6 18.6 0.8 WebMD Health 14.05 688.8 519.4 1.1 1.2 8.1 10.6 49.4 nmf na Angie's List 11.11 642.3 591.7 3.8 2.6 nmf nmf nmf nmf na Trulia 17.78 486.1 410.1 6.2 4.2 nmf 38.4 nmf nmf na Move 7.53 296.1 265.2 1.3 1.2 10.0 7.7 20.2 14.4 0.3 TechTarget 5.43 214.4 157.1 1.6 1.6 8.2 7.4 23.1 20.7 na Tree.Com 16.96 192.8 103.0 1.1 1.0 nmf nmf nmf nmf na XO Group 7.90 192.0 119.3 0.9 0.9 5.1 4.4 24.9 21.6 na zipRealty 3.08 63.6 44.6 na na na na na na na TheStreet 1.68 55.3 18.5 na na na na na na na WebMediaBrands 2.31 13.9 19.1 na na na na na na na Mean(1) 3.2x 2.6x 9.9x 8.5x 24.6x 19.8x 1.0x Median(1) 2.8x 2.5x 8.1x 7.5x 23.4x 18.6x 0.8x
Gaming
Stock Equity Enterprise (CY '13E) Price Value Value Ent. Value / Sales Ent. Value / EBITDA P/E Ratio PEG Company 11/30/12 ($ MM) ($ MM) 2012E 2013E 2012E 2013E 2012E 2013E Ratio Activision Blizzard $11.46 $12,746.0 $9,382.0 1.9x 2.0x 5.4x 5.7x 10.3x 11.5x 1.0x Electronic Arts 14.81 4,519.1 3,753.1 0.9 0.9 6.0 5.5 14.9 12.6 0.7 GameStop 26.25 3,173.6 2,807.2 0.3 0.3 3.9 3.4 8.3 7.7 0.6 Zynga 2.46 1,928.6 705.5 0.6 0.7 4.4 6.4 81.1 nmf na Take‐Two Interactive 12.37 1,122.6 1,119.9 1.1 0.7 29.6 5.0 nmf 7.1 0.9 Majesco Entertainment 0.92 38.1 11.4 0.1 0.1 0.9 na 4.5 3.6 na Atari société anonyme 1.26 37.2 59.9 na na na na na na na THQ 1.45 9.9 94.7 0.2 0.2 nmf 21.9 nmf nmf na Mean(2) 0.7x 0.7x 8.4x 5.2x 9.5x 8.5x 0.8x Median(2) 0.6x 0.7x 4.9x 5.5x 9.3x 7.7x 0.8x Sources: Capital IQ and FactSet Research Systems as of November 30, 2012 (1) EBITDA and P/E ratio metrics exclude Yelp, Zillow, and Trulia (2) EBITDA metrics exclude THQ; P/E ratio metrics exclude Zynga
Internet & Digital Media 12 Public Equity Market Overview
William Blair
Digital Media Infrastructure
Stock Equity Enterprise (CY '13E) Price Value Value Ent. Value / Sales Ent. Value / EBITDA P/E Ratio PEG Company 11/30/12 ($ MM) ($ MM) 2012E 2013E 2012E 2013E 2012E 2013E Ratio Adobe Systems $34.61 $17,133.9 $15,397.5 3.5x 3.4x 8.6x 8.4x 14.9x 14.4x 1.5x Akamai Technologies 36.62 6,498.9 6,033.7 4.4 3.8 9.8 8.6 20.7 18.3 1.4 Dolby Laboratories 33.37 3,418.3 2,645.9 2.9 2.9 6.4 6.8 14.2 16.3 1.6 Rovi 15.34 1,645.7 2,306.6 3.5 3.3 7.7 7.3 8.3 7.6 0.6 TiVo 11.70 1,449.0 998.0 4.3 3.5 23.8 47.3 nmf nmf na Monotype Imaging Holdings 15.31 566.7 561.0 3.8 3.4 8.9 7.9 20.6 17.7 1.2 RealD 10.56 543.4 530.0 2.2 2.1 7.3 7.4 nmf nmf na Harmonic 4.58 530.3 338.3 0.6 0.6 4.8 3.8 19.9 12.8 na DTS 15.28 286.2 235.5 2.3 1.6 27.5 7.7 nmf 13.8 0.8 Brightcove 9.72 270.4 245.2 2.8 2.3 nmf nmf nmf nmf na Boingo Wireless 7.09 249.3 155.2 1.5 1.3 5.0 4.0 32.2 22.9 1.7 Limelight Networks 1.94 191.8 64.4 0.4 0.3 5.9 3.9 nmf nmf na Smart Technologies 1.37 165.3 331.0 0.5 0.5 3.5 3.4 3.8 4.0 0.1 Envivio 1.62 43.6 (18.6) nmf nmf nmf nmf nmf nmf na Mean(1) 2.5x 2.2x 8.7x 6.3x 16.8x 14.2x 1.1x Median(1) 2.8x 2.3x 7.3x 7.3x 17.4x 14.4x 1.3x
Web Services
Stock Equity Enterprise (CY '13E) Price Value Value Ent. Value / Sales Ent. Value / EBITDA P/E Ratio PEG Company 11/30/12 ($ MM) ($ MM) 2012E 2013E 2012E 2013E 2012E 2013E Ratio Web.com Group $15.11 $712.1 $1,382.9 2.8x 2.6x 9.6x 8.6x 9.7x 7.8x 0.6x LogMeIn 21.40 530.8 325.6 2.3 2.0 10.1 8.6 32.0 26.5 1.5 Digital River 14.61 519.1 197.9 0.5 0.5 3.0 3.0 15.0 15.6 1.6 Active Network 5.36 324.6 248.9 0.6 0.5 6.2 4.9 nmf nmf na Carbonite 9.54 244.8 178.5 2.1 1.6 nmf nmf nmf nmf na Market Leader 6.65 175.9 153.7 3.4 2.5 63.3 11.9 nmf nmf na Synacor 6.38 173.0 138.7 1.1 0.9 12.1 7.2 39.6 20.9 0.8 Tucows 1.49 65.9 65.0 na na na na 14.9 13.5 na Mean(2) 1.8x 1.5x 8.2x 6.4x 22.3x 16.9x 1.1x Median(2) 2.1x 1.6x 9.6x 7.2x 15.0x 15.6x 1.2x Sources: Capital IQ and FactSet Research Systems as of November 30, 2012 (1) EBITDA metrics exclude TiVo and Envivio; P/E ratio metrics exclude Envivio (2) EBITDA metrics exclude Market Leader
Internet & Digital Media Public Equity Market Overview 13
William Blair
Mobile
Stock Equity Enterprise (CY '13E) Price Value Value Ent. Value / Sales Ent. Value / EBITDA P/E Ratio PEG Company 11/30/12 ($ MM) ($ MM) 2012E 2013E 2012E 2013E 2012E 2013E Ratio Amdocs $33.46 $5,521.8 $4,603.6 1.4x 1.4x 7.1x 6.6x 12.1x 11.2x 1.2x Millennial Media 13.75 1,077.1 954.7 5.2 3.3 nmf 55.2 nmf 99.1 na TeleNav 8.09 336.7 120.1 0.6 0.6 nmf nmf nmf nmf na Velti 3.41 221.6 207.7 0.7 0.6 2.9 2.4 6.3 5.4 0.2 Glu Mobile 2.86 188.6 164.5 1.9 1.6 nmf 33.0 nmf nmf na TeleCommunication Systems 2.25 130.7 241.2 0.5 0.5 6.0 4.7 nmf 52.9 na Augme Technologies 0.61 68.6 68.1 2.8 1.7 nmf nmf nmf nmf na Motricity 0.85 39.3 42.2 na na na na na na na Mean(1) 1.9x 1.4x 5.3x 4.6x 9.2x 8.3x 0.7x Median(1) 1.4x 1.4x 6.0x 4.7x 9.2x 8.3x 0.7x
Traditional Media
Stock Equity Enterprise (CY '13E) Price Value Value Ent. Value / Sales Ent. Value / EBITDA P/E Ratio PEG Company 11/30/12 ($ MM) ($ MM) 2012E 2013E 2012E 2013E 2012E 2013E Ratio Comcast $37.20 $98,890.3 $144,525.3 2.3x 2.3x 7.3x 7.0x 18.4x 16.5x 1.2x Walt Disney 49.66 88,003.6 101,410.6 2.4 2.2 8.8 8.0 15.7 14.0 1.2 News Corp. 24.64 58,050.3 63,661.3 1.9 1.8 9.0 8.3 15.8 13.4 1.0 Time Warner 47.30 44,786.4 61,474.4 2.1 2.0 8.9 8.3 14.7 12.9 1.3 Viacom 51.61 25,951.1 33,422.1 2.4 2.3 8.0 7.8 11.9 10.5 0.6 Naspers 61.78 23,808.1 25,029.8 4.9 4.1 31.7 27.7 27.1 22.5 1.8 CBS 35.98 22,862.1 27,842.1 1.9 1.8 7.8 7.3 14.0 12.3 0.8 The McGraw‐Hill Companies 53.11 14,748.6 15,588.6 2.6 2.6 8.8 8.0 16.2 14.9 1.0 Liberty Interactive 19.30 10,489.7 16,204.7 1.6 1.5 8.6 8.0 19.3 15.3 0.8 Scripps Networks 59.04 8,847.3 10,191.4 4.4 4.1 9.6 8.8 17.5 15.6 1.0 Gannett Co. 17.90 4,113.2 5,744.7 1.1 1.1 5.0 5.0 7.8 8.0 1.5 The Washington Post 367.06 2,708.2 2,453.8 0.6 0.7 5.7 6.4 31.7 49.9 na The New York Times 8.11 1,197.7 1,363.5 0.7 0.7 4.9 4.8 15.8 15.9 na Smiths News 2.40 434.9 599.7 0.2 0.2 6.1 5.4 7.5 7.0 0.4 Dex One 0.97 49.4 1,959.7 na na na na na na na SuperMedia 2.16 33.8 1,414.8 na na na na na na na Mean(2) 2.1x 2.0x 7.6x 7.2x 15.5x 13.8x 1.1x Median(2) 2.0x 1.9x 8.0x 7.8x 15.8x 14.0x 1.0x Source: Capital IQ and FactSet Research Systems as of November 30, 2012 (1) EBITDA and P/E ratio metrics exclude Millennial Media and Glu Mobile; P/E ratio metrics exclude TeleCommunication Systems (2) EBITDA metrics exclude Naspers; P/E ratio metrics exclude The Washington Post
Internet & Digital Media 14 Public Equity Market Overview
William Blair
Consumer Electronics
Stock Equity Enterprise (CY '13E) Price Value Value Ent. Value / Sales Ent. Value / EBITDA P/E Ratio PEG Company 11/30/12 ($ MM) ($ MM) 2012E 2013E 2012E 2013E 2012E 2013E Ratio Apple $585.28 $550,568.2 $439,801.2 2.7x 2.2x 7.2x 6.2x 12.8x 11.2x 0.5x Samsung Electronics 1,298.43 169,781.8 159,958.0 0.9 0.8 3.8 3.3 9.4 7.8 na Hewlett‐Packard 12.99 25,540.4 43,072.4 0.4 0.4 2.7 3.1 3.3 3.9 na Dell 9.64 16,721.6 14,504.6 0.3 0.3 2.9 3.2 5.5 5.7 na Toshiba 3.40 14,419.1 33,687.5 0.5 0.4 5.8 5.2 12.0 8.6 na Nokia 3.32 12,312.8 8,811.4 0.2 0.2 nmf 6.5 nmf nmf na LG Electronics 70.46 11,477.2 15,576.1 0.3 0.3 6.6 5.8 17.5 10.3 na Sony 9.71 9,740.4 15,903.0 0.2 0.2 3.1 2.6 nmf 18.6 na HTC 9.15 7,605.5 5,866.0 0.6 0.6 7.8 9.5 13.5 17.4 na Acer 0.87 2,409.8 1,880.8 0.1 0.1 13.4 8.6 69.2 23.2 7.7 Mean(1) 0.6x 0.6x 5.9x 5.3x 10.6x 9.3x nmf Median(1) 0.3x 0.3x 5.8x 5.2x 12.0x 8.6x nmf
Selected Europe & Latin America
Stock Equity Enterprise (CY '13E) Price Value Value Ent. Value / Sales Ent. Value / EBITDA P/E Ratio PEG Company 11/30/12 ($ MM) ($ MM) 2012E 2013E 2012E 2013E 2012E 2013E Ratio United Internet $22.50 $4,364.1 $4,766.5 1.5x 1.4x 10.8x 8.9x 21.4x 16.2x 0.8x Mercadolibre 71.95 3,176.7 3,003.3 8.0 6.4 22.2 17.5 32.4 26.0 0.9 UBM 11.80 2,878.2 3,785.6 2.3 2.2 10.5 9.4 12.7 11.2 2.1 Rightmove 24.01 2,393.9 2,370.5 12.8 11.4 17.9 15.7 25.1 21.7 na Moneysupermarket.com 2.61 1,400.0 1,341.2 4.1 3.8 13.7 11.2 20.5 16.5 0.8 Ubisoft Entertainment 10.03 951.0 1,142.9 0.7 0.7 2.1 1.9 14.2 12.6 1.3 Technicolor 2.48 824.5 2,158.1 0.5 0.5 3.4 3.2 10.4 6.0 na GameLoft 7.31 581.5 524.7 1.9 1.7 12.7 9.7 26.1 18.7 na Cupid 2.95 250.2 238.3 1.9 1.5 9.0 6.6 12.7 9.4 0.6 Tomorrow Focus 4.64 245.9 275.6 1.4 1.1 8.1 6.2 14.0 11.0 na MeetMe 3.51 129.9 136.2 na na na na nmf nmf na Hi‐Media 2.55 113.1 135.5 0.5 0.5 6.4 5.7 10.8 9.8 na Goldbach Group 18.13 106.4 81.9 0.2 0.2 2.1 2.1 9.3 8.7 0.2 TradeDoubler 1.45 61.9 35.8 0.1 0.1 7.4 3.1 13.7 7.7 na Mean 2.8x 2.4x 9.7x 7.8x 17.2x 13.5x 1.0x Median 1.5x 1.4x 9.0x 6.6x 14.0x 11.2x 0.8x Sources: Capital IQ and FactSet Research Systems as of November 30, 2012 (1) P/E ratio metrics exclude Sony Corporation and Acer; EBITDA metrics exclude Nokia Corporation
Internet & Digital Media Public Equity Market Overview 15
William Blair
Selected Asia
Stock Equity Enterprise (CY '13E) Price Value Value Ent. Value / Sales Ent. Value / EBITDA P/E Ratio PEG Company 11/30/12 ($ MM) ($ MM) 2012E 2013E 2012E 2013E 2012E 2013E Ratio Tencent Holdings $32.67 $59,896.1 $57,664.6 8.2x 6.3x 19.5x 15.4x 29.1x 22.8x 2.8x Baidu 96.31 33,669.0 30,907.8 8.9 6.5 15.3 11.7 20.0 15.7 0.4 Yahoo Japan 335.39 19,458.1 16,879.5 4.4 4.1 7.4 6.9 15.1 14.1 2.8 Nintendo 119.71 15,308.7 4,640.5 0.5 0.4 14.0 5.1 nmf 31.7 na Rakuten 8.42 11,068.6 6,681.5 1.3 1.1 5.5 4.6 20.0 16.5 0.7 NHN Corporation 232.72 10,432.7 9,520.8 4.3 3.7 13.7 11.1 23.2 18.8 na Yandex 21.82 7,140.8 6,758.8 7.2 5.5 16.0 12.3 26.3 20.0 0.7 NetEase 43.86 5,743.8 3,355.0 2.6 2.2 5.4 4.7 10.3 9.2 0.7 DeNA 36.65 4,914.7 4,255.5 1.9 1.6 4.6 4.1 10.4 9.1 0.7 Nexon 11.20 4,864.6 3,862.0 3.0 2.3 5.4 4.5 12.3 10.3 na Gree 17.36 4,041.7 3,780.0 1.8 1.6 3.9 3.7 7.2 7.0 0.2 Konami 24.10 3,340.8 3,016.3 1.0 0.9 4.7 4.4 11.8 10.8 0.3 SINA Corporation 45.52 3,016.4 2,328.9 4.5 3.8 nmf 34.4 nmf 59.0 1.7 Qihoo 360 24.99 2,982.6 2,636.1 8.2 5.4 31.9 19.8 49.3 32.0 0.7 Ncsoft 149.14 2,962.6 2,535.3 4.3 3.0 13.4 6.9 25.2 12.2 na Youku Tudou 17.06 2,789.6 2,195.3 7.7 4.5 nmf nmf nmf nmf na Ctrip.com International 19.10 2,651.6 2,339.4 3.5 3.0 15.0 13.5 28.6 22.2 2.0 SouFun Holdings 21.55 1,703.4 1,909.4 4.6 3.9 9.7 8.3 11.4 9.9 0.4 51job 52.87 1,524.3 1,152.0 5.0 4.4 14.1 11.9 19.4 17.2 0.8 Sohu.com 39.83 1,514.8 1,105.1 1.0 0.9 4.1 3.4 17.1 12.1 1.3 Changyou.com 24.62 1,299.2 1,254.6 2.0 1.8 3.4 3.1 4.7 4.4 0.4 Renren 3.43 1,290.6 398.1 2.3 1.6 nmf nmf nmf nmf na Giant Interactive Group 5.30 1,253.3 890.1 2.6 2.2 4.0 3.6 6.5 6.0 0.4 Daum Communications 78.40 1,058.6 962.8 2.2 1.9 7.1 6.1 12.8 10.5 na Perfect World 11.12 537.5 316.7 0.7 0.7 2.6 2.3 5.4 4.8 0.5 MakeMyTrip 13.94 518.0 425.1 4.8 4.1 51.2 35.6 73.4 56.0 0.7 Tom Group 0.11 426.7 647.4 na na na na na na na Mixi 2,348.24 364.2 213.4 1.3 1.2 5.6 5.3 21.7 18.8 1.2 E‐Commerce China 4.47 358.3 162.6 0.2 0.1 nmf nmf nmf nmf na Bitauto Holdings 6.62 272.7 192.1 1.3 1.0 8.1 6.5 14.7 11.6 na Kongzhong 5.90 252.7 107.3 0.6 0.5 na na 10.7 12.3 0.6 Jiayuan.com International 5.30 167.8 71.2 1.1 0.9 6.7 5.6 19.9 17.9 0.9 AirMedia Group 2.16 135.3 17.7 nmf nmf nmf 1.0 nmf 33.0 na Taomee Holdings 3.31 121.6 2.4 nmf nmf 0.2 0.2 15.6 10.0 3.3 Faith 104.69 120.2 (28.4) na na na na na na na ATA 4.18 94.1 54.2 3.4 0.8 3.4 3.9 13.2 12.0 na ChinaCache International 4.00 91.7 48.1 0.4 0.3 3.2 2.5 23.4 12.9 0.4 Index Corporation 21.81 85.7 312.0 1.5 1.7 11.9 10.5 13.6 10.3 na Mecox Lane 0.54 31.0 (11.8) nmf nmf 0.6 1.2 nmf nmf na Mean 3.2x 2.5x 10.1x 8.3x 19.1x 17.3x 1.0x Median 2.4x 1.9x 6.7x 5.3x 15.4x 12.3x 0.7x Sources: Capital IQ and FactSet Research Systems as of November 30, 2012
Internet & Digital Media 16 Public Equity Market Overview
William Blair
Initial Public Offerings
IPOs
35 30 25 20 15 10 5 0 12 09 10 11 12 r 08 r 09 r 10 r 11 r 12 g y y y y ul 11 ul 12 p p p p p an 08 an 09 an 10 un 10 un 11 un 12 Jul 10 J J Jul 08 Jul 09 J J J Jan 12 Jan 11 J J J Jun 08 Jun 09 Oct 11 Oct 10 Oct 12 Oct 08 Oct 09 Sep 11 Sep 10 Sep 12 Sep 08 Sep 09 Feb 12 Feb 11 Feb 08 Feb 09 Feb 10 Dec 11 Dec 10 Dec 08 Dec 07 Dec 09 A A A A A Aug 11 Au Aug 10 Aug 08 Aug 09 Nov 11 Nov 10 Nov 12 Nov 08 Nov 07 Nov 09 Mar 12 Mar 11 Mar 08 Mar 09 Mar 10 May 08 Ma Ma Ma Ma
IPO Backlog
140 120 100 80 60 40 20 0 Jul 09 Jul 10 Jul 11 Jul 12 Jan 09 Jan 10 Jan 11 Jan 12 Jun 09 Jun 10 Jun 11 Jun 12 Oct 09 Oct 10 Oct 11 Oct 12 Sep 09 Sep 10 Sep 11 Sep 12 Feb 09 Feb 10 Feb 11 Feb 12 Dec 08 Apr 09 Dec 09 Apr 10 Dec 10 Apr 11 Dec 11 Apr 12 Aug 09 Aug 10 Aug 11 Aug 12 Nov 08 Mar 09 Nov 09 Mar 10 Nov 10 Mar 11 Nov 11 Mar 12 Nov 12 May 09 May 10 May 11 May 12
IPOs Priced Annually
800 700 600 500 400 300 200 100 0 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
IPOs Priced Monthly
25
20
15
10
5
0 Jul 12 Jul 11 Jul 10 Jul 09 Jan 12 Jan 11 Jan 10 Jan 09 Jun 12 Jun 11 Jun 10 Jun 09 Oct 12 Oct 11 Oct 10 Oct 09 Sep 12 Sep 11 Sep 10 Sep 09 Feb 12 Feb 11 Feb 10 Feb 09 Dec 11 Apr 12 Dec 10 Apr 11 Dec 09 Apr 10 Dec 08 Apr 09 Aug 12 Aug 11 Aug 10 Aug 09 Nov 12 Nov 11 Mar 12 Nov 10 Mar 11 Nov 09 Mar 10 Nov 08 Mar 09 May 12 May 11 May 10 May 09
Source: Equidesk Data as of November 30, 2012; data does not include REITs, closed‐end funds, and SPACs Internet & Digital Media Public Equity Market Overview 17
William Blair
20112012 YTD IPOs From the IDM Sector
At Initial Filing At Offering Price Change % Shares Deal Value Shares % Change Mkt Cap Deal Value as Pricing Price Offered at Midpoint Offered Deal Value Initial/ Act (at pricing) % Mkt Cap File/ Offer/ Offer/ Date Issuer (Midpoint) (mm) (mm) Price (mm) (mm) Deal Value (mm) (at pricing) Offer 1 Day Current 10/10/12 Shutterstock $14.00 4.5 $63.0 $17.00 5.2 $88.0 39.6% $558.3 15.8% 21.4% 27.4% 39.7%
09/19/12 Trulia $15.00 6.0 $90.0 $17.00 6.9 $117.3 30.3% $448.4 26.2% 13.3% 41.2% 32.6%
07/19/12 Kayak $23.50 4.0 $94.6 $26.00 3.5 $91.0 (3.8%) $1,002.5 9.1% 10.6% 27.6% 27.4%
05/17/12 Facebook 31.50 400.6 12,618.9 38.00 421.2 16,006.9 26.8% 81,247.2 19.7% 20.6% 0.6% (44.4%)
04/26/12 Acquity Group 9.00 12.8 115.0 6.00 11.1 66.7 (42.0%) 141.1 47.2% (33.3%) (4.2%) 67.0%
04/24/12 Envivio 11.00 8.9 98.1 9.00 7.8 69.8 (28.9%) 239.9 29.1% (18.2%) (5.7%) (76.1%)
03/28/12 CafePress 17.00 4.5 76.5 19.00 4.5 85.5 11.8% 322.6 26.5% 11.8% 0.2% (68.8%)
03/28/12 Millennial Media 10.00 10.2 102.0 13.00 10.2 132.6 30.0% 973.6 13.6% 30.0% 92.3% 23.3%
03/01/12 Yelp 13.00 8.2 106.9 15.00 7.2 107.3 0.3% 898.1 11.9% 15.4% 63.9% 60.7%
02/24/12 Bazaarvoice 9.00 9.0 81.0 12.00 9.0 108.0 33.3% 682.3 15.8% 33.3% 37.6% 6.3%
02/23/12 Proto Labs 14.00 4.9 69.2 16.00 4.9 79.1 14.3% 371.0 21.3% 14.3% 81.3% 116.9%
02/17/12 Brightcove 11.00 5.8 63.3 11.00 5.8 63.3 0.0% 290.1 21.8% 0.0% 30.0% 14.7%
02/09/12 Synacor 11.00 7.8 86.2 5.00 6.8 34.1 (60.5%) 127.9 26.7% (54.5%) 5.0% 9.6%
12/15/11 Zynga 9.25 115.0 1,063.8 10.00 100.0 1,000.0 (6.0%) 6,993.7 14.3% 8.1% (5.0%) (77.6%)
12/12/11 Jive 8.00 13.7 109.7 12.00 15.5 185.5 69.0% 708.8 26.2% 50.0% 25.4% (6.7%)
11/16/11 Angie's List 12.00 10.1 121.3 13.00 10.1 131.5 8.3% 722.7 18.2% 8.3% 25.1% (12.0%)
11/03/11 Groupon 17.00 35.3 599.3 20.00 40.3 805.0 34.3% 12,756.1 6.3% 17.6% 30.6% (79.4%)
10/13/11 Ubiquiti Networks 21.00 8.1 170.0 15.00 8.1 121.4 (28.6%) 1,345.5 9.0% (28.6%) 16.7% (21.3%)
08/16/11 Tudou Holdings 29.00 6.9 200.1 29.00 6.0 174.0 (13.0%) 822.3 21.2% 0.0% (11.9%) na
08/10/11 Carbonite 16.00 7.2 115.0 10.00 7.2 71.9 (37.5%) 240.0 29.9% (37.5%) 23.5% (22.7%)
07/19/11 Zillow 13.00 4.0 51.8 20.00 4.0 79.6 53.8% 541.2 14.7% 53.8% 78.9% 86.8%
06/28/11 HomeAway 25.50 9.2 234.6 27.00 9.2 248.4 5.9% 2,155.4 11.5% 5.9% 48.9% (4.8%)
06/16/11 Bankrate 15.00 23.0 345.0 15.00 23.0 344.9 (0.0%) 1,500.0 23.0% 0.0% 2.3% (28.5%)
06/14/11 Pandora Media 8.00 15.9 127.1 16.00 15.0 240.5 89.3% 2,555.6 9.4% 100.0% 8.9% (47.4%)
06/08/11 Taomee Holdings 10.00 165.3 1,653.1 9.00 143.8 1,293.8 (21.7%) 325.5 397.5% (10.0%) (8.6%) (60.6%)
05/24/11 Active Network 17.00 12.7 215.1 15.00 12.7 189.8 (11.8%) 794.7 23.9% (11.8%) 6.0% (40.9%)
05/23/11 Yandex NV 21.00 57.4 1,205.2 25.00 57.4 1,434.8 19.0% 8,031.2 17.9% 19.0% 55.4% (6.8%)
05/19/11 LinkedIn 33.50 9.0 302.0 45.00 9.0 405.7 34.3% 4,252.4 9.5% 34.3% 106.9% 137.6%
05/11/11 Jiayuan.com 11.00 12.2 134.7 11.00 11.0 121.5 (9.8%) 343.9 35.3% 0.0% (2.8%) (51.0%)
05/10/11 FriendFinder 11.00 20.8 228.3 10.00 5.0 50.0 (78.1%) 263.3 19.0% (9.1%) (21.5%) (92.3%)
05/04/11 Renren 10.00 183.2 1,832.0 14.00 183.2 2,564.7 40.0% 5,487.0 46.7% 40.0% 20.5% (76.6%)
05/03/11 Boingo Wireless 13.00 6.6 86.3 13.50 5.8 77.9 (9.7%) 439.1 17.7% 3.8% (10.4%) (45.8%)
04/20/11 Responsys 9.25 7.6 70.4 12.00 7.6 91.4 29.7% 529.3 17.3% 29.7% 28.3% (25.5%)
04/13/11 Zipcar 15.00 9.8 146.8 18.00 11.1 200.5 36.6% 695.1 28.8% 20.0% 55.6% (65.2%)
03/29/11 Qihoo 360 Technology 11.50 20.9 240.2 14.50 20.9 302.9 26.1% 1,674.4 18.1% 26.1% 134.5% 41.9%
01/25/11 Demand Media 15.00 8.8 132.5 17.00 10.2 174.0 31.3% 1,393.4 12.5% 13.3% 33.2% (49.8%)
Mean(1) $324.3 8.7% $1,732.2 30.9% 11.1% 28.8% (9.7%)
Median(1) $121.5 10.0% $708.8 18.6% 12.5% 25.2% (21.3%) Note: Only companies trading on U.S. exchanges are included Sources: Capital IQ and FactSet Research Systems as of November 30, 2012 (1) Excludes Facebook with exception of Price Change statistics
Internet & Digital Media 18 Public Equity Market Overview
William Blair
Internet & Digital Media IPO Backlog
($ in millions) LTM LTM LTM Filing Date Company Business Description Deal Value Revenue EBITDA Net Income Cash 11/05/12 Babylon Translation software solutions and Internet search $115.0 $143.8 $28.1 $22.3 $12.3 services
06/15/12 AutoTrader (1) Automotive marketplace and consumer information $300.0 $931.7 $345.8 $62.0 nmf website
05/10/12 LegalZoom.com Online provider of services for legal needs of small $120.0 $156.1 $11.8 $12.1 $27.1 businesses and consumers
03/16/12 Exponential Advertising intelligence and digital media solutions $75.0 $169.1 $22.0 $6.9 $14.3 Interactive
12/22/11 Gogo (2) Provider of in‐flight connectivity and wireless in‐cabin $100.0 $148.3 ($3.9) $6.4 $53.0 digital entertainment solutions
06/08/11 Xunlei (2) Leading consumer internet platform for digital media $200.0 $47.1 $15.6 $8.7 $20.6 content in China
05/24/11 Cloudary (2, 3) Online community‐driven literary platform $200.0 $76.7 ($7.8) ($7.5) $37.4
05/28/10 Tripwire Provides software solutions to protect physical and $86.3 $77.1 $8.8 $18.7 $33.5 virtual IT infrastructure
02/10/10 GameFly Online videogame rental subscription service $50.0 $92.9 $5.6 $1.6 $11.0
Mean(4) $138.5 $204.8 $62.5 $14.6 $26.1
Median(4) $115.0 $143.8 $15.6 $8.7 $23.8
Note: Mean and median exclude negative values; companies included in backlog limited to those looking to raise on U.S. exchanges only Sources: Dealogic and Capital IQ (1) CEI provides cash management services to its subsidiary, AutoTrader, resulting in a $0 net cash balance (2) EBITDA excludes stock‐based compensation and makes other adjustments (3) EBITDA is adjusted using noncash charges because LTM data is not available (4) Excludes negative values from mean and median
Internet & Digital Media Public Equity Market Overview 19
William Blair
Financing Activity
20092012 YTD Sector Breakdown 20092012 YTD Deal Value Breakdown
3,734 Transactions ($ in millions)
5.7% Content 708 Digital Media 526 566 523 472 10.3% 20.9% E‐commerce 362 302 Gaming 210 5.5% 13.8% Mobile 34 31 Online Advertising 11.7% 16.9% Services 9.6% Social Network 5.6% Video
Note: Includes North American Internet & Digital Media M&A transactions from November 1, 2009, to November 30, 2012 Sources: Capital IQ and various media outlets
Internet & Digital Media – November 2012
Private Placement Activity Vertical # of Deals % of Total Content 20 25.3% Digital Media 45.1% E‐commerce 12 15.2% Gaming 78.9% Mobile 10 12.7% Online Advertising 9 11.4% Services 10 12.7% Social Network 33.8% Video 45.1% Total 79 100.0% Note: Includes North American Internet & Digital Media private placements from November 1, 2012, to November 30, 2012 Sources: Capital IQ and various media outlets
Internet & Digital Media 20 Financing Activity
William Blair
Selected Monthly Internet & Digital Media Private Placement Transactions
($ in millions) Announced Closed Proceeds Round Date Date Target Category Raised Number Investors 11/30/12 11/30/12 Evernote Corporation Services $85.0 ‐ T. Rowe Price; Valiant Capital Partners; AGC Equity Partners; m8 Capital 11/30/12 11/30/12 Rent The Runway E‐commerce $20.0 ‐ Highland Capital Partners; Kleiner Perkins Caufield & Byers; Advance Magazine Publishers; Bain Capital Ventures 11/30/12 11/30/12 Nomorerack.com E‐commerce $12.0 1 Giosis Gmarket International
11/30/12 ‐ Wikia Content $10.8 3 Amazon.com; Bessemer Venture Partners; Institutional Venture Partners 11/28/12 11/28/12 iSchool campus Content $2.0 1 Crocker Ventures
11/26/12 11/26/12 Lift Worldwide Mobile $2.5 1 Spark Capital; The Obvious Corporation; SV Angel
11/23/12 11/23/12 ioRevolution Digital Media $10.0 1 Atlas Venture; Battery Ventures; GIMV; Genesis Partners; Longworth Venture Partners; Correlation Ventures 11/21/12 11/21/12 Chango Online $12.0 ‐ Rho Capital Partners; iNovia Capital; Extreme Venture Partners; Advertising Metamorphic Ventures; Mantella Venture Partners 11/21/12 11/21/12 BetterLesson Content $3.5‐‐
11/21/12 11/21/12 Trulioo Social Network $2.0 Seed Blumberg Capital
11/20/12 11/20/12 Kaltura Video $25.0 4 Intel Capital; Mitsui & Co. Global Investment; Avalon Ventures; ORIX Venture Finance; Nexus Venture Partners; .406 Ventures 11/20/12 11/20/12 CAP THAT Content $2.3 2 Intertainment Media
11/16/12 ‐ TST Media Digital Media $5.0 ‐ ‐
11/15/12 11/15/12 zulily E‐commerce $85.0 4 Maveron; MeriTech Capital Partners; Andreessen Horowitz
11/15/12 11/15/12 VuClip Video $13.0 4 New Enterprise Associates; SingTel Ventures; JAFCO Ventures
11/15/12 11/15/12 This Technology Video $7.5 1 General Catalyst Partners
11/15/12 11/15/12 InboundWriter Online $2.5 ‐ Castile Ventures; CrossLink Capital; Rho Capital Partners; Advertising Formative Ventures; The Entrepreneurs' Fund 11/15/12 11/15/12 Chromatik Content $2.0 Seed Learn Capital Venture Partners; Kapor Capital; 500 Startups; Launchpad LA; MuckerLab 11/15/12 11/15/12 Lookout Gaming Gaming $2.0 Seed Atlas Venture; NextView Ventures
11/14/12 11/14/12 Origami Logic Online $9.3 1 Accel Partners; Lightspeed Venture Partners Advertising 11/14/12 11/14/12 PlayHaven Gaming $8.0 ‐ e.ventures; GGV Capital; Tandem Entrepreneurs Management Services 11/14/12 11/14/12 all‐in‐one TV Video $8.0 ‐ UTStarcom Holdings
11/14/12 11/14/12 CoachUp Social Network $2.2 1 General Catalyst Partners; Breakaway Innovation Group
11/13/12 11/13/12 Retrofit Services $8.0 1 Draper Fisher Jurvetson; New World Ventures; Correlation Ventures; Hyde Park Angels; I2A Fund 11/13/12 11/13/12 DogVacay E‐commerce $6.0 1 Benchmark Capital
11/13/12 11/13/12 SocialWire Content $2.5 Seed First Round Capital; 500 Startups
Note: Includes North American private placements with proceeds raised greater than $2 million from November 1, 2012, to November 30, 2012 Sources: Capital IQ and various media outlets
Internet & Digital Media Financing Activity 21
William Blair
Selected Monthly Internet & Digital Media Private Placement Transactions (cont’d)
($ in millions) Announced Closed Proceeds Round Date Date Target Category Raised Number Investors 11/12/12 11/12/12 Connected Sports Gaming $4.3 ‐ ‐ Ventures 11/12/12 11/12/12 DoubleDutch Mobile $4.0 2 FLOODGATE; Lightbank; Bullpen Capital
11/12/12 ‐ Ogmento Gaming $3.0 ‐ ‐
11/9/12 11/14/12 Billtrust Services $25.0 2 Bain Capital Ventures
11/9/12 11/9/12 ToyTalk Mobile $12.0 ‐ Charles River Ventures
11/9/12 11/14/12 Percolate Industries Content $9.0 1 GGV Capital; First Round Capital; Lerer Ventures
11/9/12 ‐ OverNear Mobile $4.0 ‐ ‐
11/9/12 ‐ Toopher Mobile $2.0 ‐ ‐
11/8/12 11/8/12 YourCityDeals E‐commerce $50.0 ‐ ‐
11/8/12 11/8/12 Munchery E‐commerce $4.2 1 e.ventures
11/8/12 11/8/12 NuORDER E‐commerce $3.0 1 GRP Partners; Creative Artists Agency; Greycroft Partners; Rachel Zoe 11/7/12 11/7/12 General Assembly Services $9.8 2 VegasTechFund; Mousse Partners; Maveron; Bezos Expeditions
11/7/12 11/7/12 Betabrand E‐commerce $6.5 2 Foundry Group
11/7/12 ‐ MunkyFun Gaming $3.3 ‐ ‐
11/5/12 11/5/12 HubSpot Online $35.0 ‐ Fidelity Investments; Cross Creek Capital; Altimeter Capital Advertising Management 11/5/12 11/7/12 Medialets Online $10.0 3 Draper Fisher Jurvetson Gotham Ventures; Greenspring Advertising Associates; Foundry Group 11/5/12 11/5/12 OrderGroove Services $7.0 2 Fung Capital Asia Investment; Allegro Ventures; Swan Ventures; Legend Ventures; Lerer Ventures; Bee Partners 11/5/12 ‐ Swoop Content $5.0‐‐
11/5/12 ‐ BubbleLife Media Online $3.0 ‐ ‐ Advertising 11/2/12 11/2/12 Flurry Mobile $25.0 4 Draper Fisher Jurvetson; Draper Richards; InterWest Partners; Menlo Ventures; CrossLink Capital; Union Square Ventures; First Round Capital
11/2/12 11/2/12 Picturelife Content $4.5 1 Spark Capital; Betaworks; Founder Collective; SV Angel; Lerer Ventures; High Line Venture Partners; CrunchFund 11/1/12 11/1/12 Hive Mind Content $10.0 ‐ Electronic Arts
11/1/12 11/1/12 Dollar Shave Club E‐commerce $9.8 1 Kleiner Perkins Caufield & Byers; Rustic Canyon Partners; Venrock; Shasta Ventures; Felicis Ventures; Andreessen Note: Includes North American private placements with proceeds raised greater than $2 million from November 1, 2012, to November 30, 2012 Sources: Capital IQ and various media outlets
Internet & Digital Media 22 Financing Activity
William Blair
M&A Activity
20092012 YTD Sector Breakdown 20092012 YTD Deal Value Breakdown
1,333 Transactions ($ in millions)
3.9% 930 73 6.2% Content Digital Media 54 46 18.7% 39 43 E‐commerce 34 10.9% 28 30 31 Gaming 25 10.0% Mobile 13.9% Online Advertising 16.0% 10.8% Services 9.6% Social Network Video
(1) Data does not include deals with an undisclosed deal value Note: Includes North American Internet & Digital Media M&A transactions from November 1, 2009, to November 30, 2012 Sources: Capital IQ and various media outlets
Internet & Digital Media – November 2012
M&A Activity Vertical # of Deals % of Total Content 4 14.3% Digital Media 13.6% E‐commerce 6 21.4% Gaming 4 14.3% Mobile 13.6% Online Advertising 7 25.0% Services 3 10.7% Social Network 13.6% Video 13.6% Total 28 100.0% Note: Includes North American Internet & Digital Media M&A transactions from November 1, 2012, to November 30, 2012 Sources: Capital IQ and various media outlets
Internet & Digital Media M&A Activity 23
William Blair
Selected Monthly Internet & Digital Media M&A Transactions
($ in millions) Total Announced Closed Transaction Enterprise EV/LTM EV/LTM Date Date Target Acquirer Category Value Value Revenue EBITDA 11/30/12 11/30/12 Bundle Corporation Capital One Financial Content ‐‐ ‐‐
11/28/12 11/28/12 Incentive Targeting Google Online Advertising‐ ‐ ‐ ‐
11/28/12 11/28/12 Geni MyHeritage Services ‐ ‐ ‐ ‐
11/26/12 ‐ HotPads Zillow Content $16.0 $16.0 ‐ ‐
11/26/12 ‐ Product Madness Aristocrat Leisure Gaming ‐ ‐ ‐ ‐
11/21/12 11/15/12 Gamblers Gifts Poplyn eCommerce E‐commerce ‐ ‐ ‐‐
11/20/12 ‐ YES Network News Corp. Content ‐ $3,000.0 ‐ ‐
11/19/12 ‐ GetGlue Viggle Services $78.6 $78.6 ‐ ‐
11/14/12 11/14/12 One Jackson TaskRabbit E‐commerce ‐ ‐ ‐ ‐
11/13/12 11/13/12 iCircular Wanderful Media Online Advertising ‐ ‐ ‐‐
11/13/12 11/13/12 GoJane.com Aéropostale E‐commerce ‐ ‐ ‐ ‐
11/13/12 ‐ Fertitta Interactive Station Casinos Gaming ‐ ‐ ‐ ‐
11/13/12 ‐ Apps Genius RPG Gaming ‐ ‐ ‐ ‐
11/12/12 11/12/12 Ziff Davis Media j2 Global Digital Media $175.0 $175.0 ‐ ‐
11/9/12 ‐ November Software Zynga Gaming ‐ ‐ ‐ ‐
11/9/12 11/9/12 ZoomSafer Aegis Mobility Mobile ‐ ‐ ‐ ‐
11/9/12 11/9/12 4Mads InSequent Online Advertising ‐ ‐ ‐ ‐
11/8/12 ‐ Kayak priceline.com E‐commerce $1,807.9 $1,629.5 5.8x 30.2x
11/8/12 11/8/12 Exclusively.In Myntra Designs E‐commerce ‐ ‐ ‐ ‐
11/7/12 11/7/12 LectureTools Echo360 Services ‐ ‐ ‐ ‐
11/5/12 11/30/12 Mortech Zillow Content $17.4 $17.4 ‐ ‐
11/5/12 11/5/12 Longboard Media Bazaarvoice Online Advertising $44.2 $44.2 ‐ ‐
11/5/12 11/1/12 Plaid Skirt Marketing Digital Net Agency Online Advertising ‐ ‐ ‐ ‐
11/5/12 11/5/12 SkuLoop Revionics Online Advertising ‐ ‐ ‐ ‐
11/5/12 11/5/12 Meetings.io Jive Software Video ‐ ‐ ‐ ‐
11/2/12 11/2/12 Swap.com Netcycler E‐commerce ‐ ‐ ‐ ‐
11/2/12 11/2/12 Nexopia.com Ideon Media Social Network ‐ ‐ ‐ ‐
11/1/12 11/1/12 Postling LocalVox Online Advertising ‐ ‐ ‐ ‐
Includes North American M&A transactions from November 1, 2012, to November 30, 2012 Sources: Capital IQ and various media outlets
Internet & Digital Media 24 M&A Activity
William Blair
William Blair Internet & Digital Media Credentials
$207,460,000 Not Disclosed $87,975,000 $117,300,000
has received a growth equity investment from Strategic Technology Initial Public Offering Initial Public Offering IPO & Follow‐On Investors Feb. & Nov. 2012 October 2012 October 2012 September 2012
Not Disclosed Not Disclosed Not Disclosed $16,006,877,370
TM
A wholly owned subsidiary of Yext has been acquired by has been acquired by has been acquired by
Initial Public Offering
August 2012 July 2012 June 2012 May 2012
Not Disclosed $805,000,000 Not Disclosed $71,875,000
has been acquired by has been acquired by
Initial Public Offering Initial Public Offering
November 2011 November 2011 October 2011 August 2011
$20,000,000 $54,000,000 $240,544,000 $77,895,000
Private Placement Private Placements Initial Public Offering Initial Public Offering
August 2011 2008 and 2011 June 2011 May 2011
$142,450,000 $91,351,224 $248,100,000 $800,000,000
has been acquired by has been acquired by
Initial Public Offering Follow‐On Offerings
April 2011 April 2011 2010 and 2011 February 2011
Represents transactions completed by a William Blair banker while at prior firms
Internet & Digital Media William Blair Internet & Digital Media Credentials 25
William Blair
William Blair Internet & Digital Media Credentials (cont’d)
$127,000,000 $19,550,000 $173,000,000 $18,500,000
has acquired Follow‐On Initial Public Offering Private Placement
February 2011 January 2011 January 2011 December 2010
$479,396,000 $60,000,000 Not Disclosed
has been acquired by
Strategic Advisory IPO & Follow‐On Initial Public Offering
October 2010 July & Dec 2010 May 2010 May 2010
$33,465,000 $118,594,000 Not Disclosed Not Disclosed
has been acquired by Secondary Common Follow‐On Initial Public Offering Stock Placement December 2009 November 2009 November 2009 September 2009
$417,046,500 $8,100,000,000 $215,800,000 $50,000,000
has been acquired by has been acquired by
IPO & Follow‐Ons IPO & Follow‐On
2007 & 2008 July 2008 2007 & 2008 December 2007
Not Disclosed $206,816,000 $1,000,000,000 $625,000,000
has acquired has been acquired by
IPO & Follow‐On Initial Public Offering
December 2007 2007 & 2008 October 2007 September 2007
Represents transactions completed by a William Blair banker while at prior firms
Internet & Digital Media 26 William Blair Internet & Digital Media Credentials
William Blair
William Blair Internet & Digital Media Team
Brent Gledhill John Ettelson Global Head of Corporate Finance Chief Executive Officer [email protected] [email protected] +1 312 364 5475 +1 312 364 8620
North America Mark Watt Robert Metzger James Hoak Jenica Blechschmidt [email protected] [email protected] [email protected] [email protected] +1 415 248 5910 +1 312 364 8517 +1 415 248 5908 +1 415 248 2867
U.S. VC Coverage Brandon Lower Charles Watson Jamie Wildman Jonathan Skinner Anu Sharma [email protected] [email protected] [email protected] [email protected] [email protected] +1 212 237 2716 +1 312 364 8997 +1 312 364 8076 +1 312 364 7522 +1 415 248 5912
Europe Raphael Grunschlag Matt Gooch Stewart Licudi [email protected] [email protected] [email protected] +44 20 7868 4501 +44 20 7868 4478 +44 20 7868 4512
AsiaPacific Andrew Kaye [email protected] +011 86 21 2327 2233
Mergers & Acquisitions Mark Brady Dan Connolly [email protected] [email protected] +1 312 364 8853 +1 312 364 8544
Equity Capital Markets Brett Paschke [email protected] +1 312 364 8657
Institutional Sales & Trading John Moore [email protected] +1 312 364 8836
Private Capital Kelly Martin [email protected] +1 312 364 8832
Equity Research Ralph Schackart Mark Miller [email protected] [email protected] +1 312 364 8753 +1 312 364 8498
Internet & Digital Media William Blair Internet & Digital Media Team 27
William Blair
Disclosures
William Blair is a trade name for William Blair & Company, L.L.C. and William Blair International, Limited. William Blair Company, L.L.C., is a Delaware Company and is regulated by the Securities and Exchange Commission, the financial industry regulatory authority, and other principal exchanges. William Blair International Limited is authorised and regulated by the Financial Services Authority ("FSA") in the United Kingdom. William Blair & Company® only offers products and services where it is permitted to do so. Some of these products and services are only offered to persons or institutions situated within the United States and are not offered to persons or institutions outside of the United States.
This material has been approved for distribution in the United Kingdom by William Blair International Limited, and is directed only at, professional clients and eligible counterparties (as defined in cobs 3.5 and 3.6 of the FDA handbook). This advertisement is not intended to be investment advice.
William Blair & Company | 222 West Adams Street | Chicago, Illinois 60606 | +1 312 236 1600 | williamblair.com
December 6, 2012
Internet & Digital Media 28 Disclosures
International
London William Blair International, Limited The Broadgate Tower 20 Primrose Street Headquarters 17th Floor Chicago London EC2A 2EW 222 West Adams Street United Kingdom Chicago, IL 60606 Equity Sales: +44 20 7868 4400 +1 312 236 1600 Corporate Finance: +44 20 7868 4444 +1 800 621 0687 [email protected] 40 Bruton Street williamblair.com London W1J 6QZ United Kingdom Investment Management: +44 20 7297 4700 United States
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Wilmington 500 Delaware Avenue Suite 720 Wilmington, DE 19801 +1 302 573 5000 William Blair & Company is a global investment banking and asset management firm. We are committed to building enduring December 2011 relationships with our clients and providing expertise and Monthly Update solutions to meet their evolving needs. An independent and employee-owned firm, William Blair is based in Chicago, with 10 office locations including London, New York, Shanghai, and Zurich. For more information, please visit williamblair.com.
Mark McNay Partner & Managing Director [email protected] +1 415 248 5902
Andrew Arno Director [email protected] +1 415 248 5905
Patrick Vihtelic Cloud Insights Associate [email protected] M&A and Capital Markets Perspective + 1 415 248 5911 on the Cloud Computing Industries: Paul Huber Senior Analyst [email protected] • Software-as-a-service +1 415 248 5901 • Platform-as-a-service • Infrastructure as-a-service