STRICTLY PRIVATE & CONFIDENTIAL Q3 2017 Internet & Digital Media Market Snapshot Robert Berstein Frank Cordek Managing Director Director [email protected] [email protected] www.signalhill.com Baltimore│Bangalore│Boston │ Mumbai│Nashville│NewYork│Reston│San Francisco Table of Contents I. Public Company Universe and Trading Statistics II. Mergers and Acquisitions Activity III. Private Placement Activity IV. IPO Activity Strictly Private & Confidential 2 Quarterly Summary Public Company Trading Statistics1 M&A Activity 6.0x $32,000 120 4.9x 5.0x 2 96 4.1x 100 4.0x $24,000 of DealsNumber 4.0x 3.6x 3.7x 3.5x 72 80 3.0x 57 3.1x $16,000 48 51 60 2.5x 2.0x 2.8x 2.4x 2.3x 2.2x 40 3 EV / CY'17ERevenue $8,000 21 1.0x 20 Aggregate Deal Value ($M)Value DealAggregate 0.0x Q3 2016 Q3 2017 Q3 2016 Q3 2017 Q3 2016 Q3 2017 $0 0 Q3 2016 Q3 2017 Q3 2016 Q3 2017 Q3 2016 Q3 2017 Internet Content & Services e-Commerce Interactive Marketing & Marketing Services Internet Content & e-Commerce Interactive Marketing & Services Marketing Services Median Mean Private Placement Activity4 IPO Activity $4,000 40 34 2 $3,500 35 $32.00 28 $32.00 $3,000 30 of DealsNumber $26.00 $26.54 $2,500 21 25 $25.09 $24.00 $2,000 20 14 $1,500 13 15 $16.00 $15.00 9 3 $14.00 $13.56 $1,000 10 $13.00 $11.50 Aggregate DealValue ($M) $500 5 $8.90 $8.00 $0 0 Q3 2016 Q3 2017 Q3 2016 Q3 2017 Q3 2016 Q3 2017 Internet Content & Services e-Commerce Interactive Marketing & $0.00 Marketing Services RDFN DESP SECO ROKU ROVIO Offer Price Price as of 9/30/17 Source: Signal Hill Database of Core IDM Deals – Information collected from multiple industry sources Strictly Private & Confidential (1) Includes LTM’17 and ’16 Actuals (3) Includes only targets with significant North American operations 3 (2) Includes only values for which data is publicly available (4) Includes only transactions $10 million or greater PUBLIC COMPANY UNIVERSE I AND TRADING STATISTICS Signal Hill’s IDM Public Company Universe Transitioning Interactive Marketing Internet Content & Services e-Commerce Media & Marketing Services Diversified Traditional Marketing Technology Networks Data & Analytics Vertical Marketplace Ad Tech Diversified Publishers SMB-Focused Marketing Services e-Commerce Enabling Technology Note: IDM Universe excludes companies that have not achieved or maintained an Enterprise Value of at least $50M for the Strictly Private & Confidential previous 4 quarters (as of 9/30/2017) 5 IDM Public Companies Stock Price Performance LTM Sub-Sectors Performance vs. S&P 500 80% 70% 60% 50% 40% 30% 20% 10% 0% -10% -20% -30% 9/30/16 12/31/16 3/31/17 6/30/17 9/30/17 Signal Hill IDM Composite Internet Content and Services e-Commerce Interactive Marketing Marketing Services S&P 500 Strictly Private & Confidential 6 Internet Content & Services ($ in millions, except per share amounts) % Dec./Inc. Fully Fully Enterprise Value / (Price as of 9/30/2016) Price from LTM Diluted Diluted YoY Revenue Growth Revenue EBITDA Enterprise Value CY Revenues Company 9/30/2017 High Low Eq. Val. Net Cash Ent. Val. CY '17E CY '18E LTM CY '17E CY '18E LTM CY '17E CY '18E Revenue EBITDA Internet Content & Services Google $973.72 (3.5%) 30.9% $669,590 $90,758 $578,832 22.2% 17.6% 5.8x 5.3x 4.5x NM 13.3x 11.2x 5.8x 17.6x Microsoft 74.49 (1.9%) 32.3% 573,740 40,403 533,337 8.5% 7.8% 5.9x 5.3x 4.9x 17.5x 13.7x 12.7x 4.6x 14.3x Facebook 170.87 (2.6%) 50.5% 496,240 35,452 460,788 43.2% 30.0% 13.9x 11.8x 9.0x 25.5x 18.6x 14.6x 15.6x 31.2x Netflix 181.35 (5.3%) 85.8% 78,298 (2,672) 80,969 30.5% 22.3% 7.9x 7.0x 5.8x NM NM 45.4x 5.6x NM Weibo 98.94 (8.6%) 146.6% 21,632 606 21,026 67.3% 43.8% 28.7x 19.3x 13.4x NM 49.9x 30.3x 19.3x NM Snap Inc. 14.54 (50.6%) 28.9% 17,407 2,782 14,625 NA 84.2% 23.4x 16.5x 9.0x NM NM NM NM NM Yandex 32.95 (2.2%) 90.7% 10,709 644 10,065 33.9% 21.9% 7.1x 6.2x 5.1x 27.1x 19.1x 15.0x 5.8x 19.0x Twitter 16.87 (33.2%) 19.5% 12,389 2,334 10,055 (6.0%) 6.1% 4.1x 4.2x 3.9x NM 14.5x 13.4x 5.7x NM IAC/InterActiveCorp 117.58 (1.6%) 94.7% 9,378 (283) 9,661 1.6% 13.0% 3.1x 3.1x 2.7x 21.5x 16.3x 12.8x 1.7x 14.3x CoStar Group 268.25 (6.8%) 49.7% 9,580 260 9,320 14.5% 13.9% 10.4x 9.7x 8.5x 42.3x 34.0x 25.7x 8.8x 40.8x Zillow 40.15 (21.1%) 28.8% 7,387 223 7,165 26.2% 20.2% 7.4x 6.7x 5.6x NM 31.3x 23.0x 8.1x NM Match Group 23.19 (5.0%) 31.5% 6,256 (692) 6,948 4.6% 14.5% 5.4x 5.4x 4.7x 18.8x 15.3x 12.8x 4.9x 19.1x TripAdvisor 40.53 (38.7%) 14.7% 5,624 637 4,987 6.5% 10.1% 3.3x 3.1x 2.9x 24.9x 15.3x 14.9x 5.8x 41.2x Yelp 43.30 (2.1%) 60.8% 3,542 512 3,030 20.8% 17.9% 3.8x 3.5x 3.0x NM 20.2x 15.8x 4.5x NM Roku 26.54 (10.9%) 68.5% 2,515 (180) 2,695 NA NA 6.2x NA NA NM NA NA NM NM Zynga 3.78 (6.0%) 57.5% 3,271 739 2,532 13.1% 9.3% 3.3x 3.0x 2.8x NM 21.2x 16.9x 2.3x NM Pandora 7.70 (48.5%) 13.9% 1,868 (298) 2,166 8.8% 13.4% 1.5x 1.5x 1.3x NM NM NM 2.5x NM Chegg 14.84 (7.0%) 128.0% 1,591 66 1,525 (2.7%) 22.5% 6.0x 6.3x 5.1x NM 36.7x 22.4x 2.2x NM Blucora 25.30 (2.5%) 130.5% 1,137 (294) 1,431 11.2% 7.1% 2.9x 2.8x 2.7x 15.5x 14.3x 12.0x 3.1x 15.8x TrueCar 15.79 (27.4%) 86.4% 1,555 153 1,403 19.4% 14.4% 4.6x 4.3x 3.7x NM NM 32.4x 2.7x NM Bankrate 13.95 (2.1%) 96.5% 1,240 (108) 1,349 14.5% 12.1% 2.8x 2.7x 2.4x 13.3x 10.6x 9.6x 2.4x 10.4x Rovio 13.59 (6.8%) 1.3% 1,059 41 1,018 NA NA 3.4x NA NA 23.0x NA NA NM NM XO Group 19.67 (6.3%) 31.2% 486 98 388 6.6% 9.5% 2.5x 2.4x 2.2x 27.5x 13.8x 10.2x 2.7x 17.7x eHealth 23.89 (6.9%) 274.4% 443 66 377 (7.8%) 11.7% 2.2x 2.2x 2.0x NM NM NM 0.7x 7.6x Brightcove 7.20 (47.8%) 33.3% 247 28 220 1.8% 6.2% 1.4x 1.4x 1.3x NM NM 35.4x 2.8x NM Dice Holdings 2.60 (69.2%) 48.6% 131 (46) 178 (7.4%) 1.0% 0.8x 0.8x 0.8x 4.5x 4.2x 3.9x 1.9x 8.3x Spark Networks 1.22 (27.4%) 61.1% 39 10 29 (24.8%) 0.5% 1.0x 1.1x 1.1x NM 17.0x 15.5x 0.9x NM Median 4.1x 4.2x 3.7x 22.2x 16.3x 14.9x 3.8x 17.6x Mean 6.3x 5.4x 4.3x 21.8x 20.0x 18.5x 5.0x 19.8x Source: Capital IQ Median and Mean calculations exclude companies that have not achieved or maintained an Enterprise Value of $50m or more for four consecutive quarters EBITDA multiples >50x excluded All estimates from Capital IQ and calendarized unless otherwise noted (as of 9/30/17) Strictly Private & Confidential Enterprise Value calculated as Equity Value plus total debt, minority interest and preferred stock, less cash and equivalents 7 Internet Content & Services ($ in millions, except per share amounts) % Dec./Inc. Fully Fully Enterprise Value / (Price as of 9/30/2016) Price from LTM Diluted Diluted YoY Revenue Growth Revenue EBITDA Enterprise Value CY Revenues Company 9/30/2017 High Low Eq. Val. Net Cash Ent. Val. CY '17E CY '18E LTM CY '17E CY '18E LTM CY '17E CY '18E Revenue EBITDA Diversified Media Verizon $49.49 (9.7%) 15.6% $201,890 ($114,713) $316,603 (0.6%) 1.3% 2.6x 2.5x 2.5x 7.2x 7.0x 6.9x 2.4x 6.9x Comcast 38.48 (8.8%) 28.2% 181,371 (63,169) 244,540 5.8% 6.3% 2.9x 3.1x 2.9x 8.8x 8.6x 8.1x 2.8x 8.5x The Walt Disney Company 98.57 (15.1%) 9.1% 152,141 (21,371) 173,512 1.7% 4.9% 3.1x 3.1x 3.1x 10.3x 9.8x 9.2x 3.0x 9.3x Time Warner 102.45 (0.9%) 30.8% 79,686 (21,325) 101,011 5.9% 5.0% 3.4x 3.5x 3.3x 11.6x 11.5x 10.8x 3.0x 10.9x Twenty-First Century Fox 26.38 (19.1%) 9.7% 48,399 (15,660) 64,059 4.0% 4.8% 2.2x 2.3x 2.2x 9.0x 8.9x 8.1x 2.3x 9.6x CBS 58.00 (17.3%) 6.7% 23,312 (9,014) 32,326 (5.3%) 4.6% 2.4x 2.2x 2.4x 10.6x 10.2x 9.2x 2.3x 10.0x Viacom 27.84 (40.4%) 4.5% 11,634 (11,010) 22,644 6.0% 1.5% 1.7x 1.8x 1.7x 7.7x 7.3x 7.0x 2.1x 7.8x Discovery 21.29 (29.6%) 5.7% 11,628 (8,116) 19,744 3.9% 6.9% 3.1x 3.0x 2.9x 8.0x 7.9x 7.6x 3.7x 9.9x Scripps Networks Interactive 85.89 (2.9%) 41.7% 11,150 (3,129) 14,278 4.2% 3.9% 4.2x 4.2x 4.0x 9.3x 10.0x 9.7x 3.6x 7.6x Axel Springer 63.35 (7.3%) 35.0% 6,835 (1,974) 8,809 16.5% 4.0% 2.3x 2.5x 2.2x 14.2x 11.6x 10.7x 1.9x 11.7x News Corp.