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Why Viggle is a Short: Up To

66% DownsideBleecker Street Research

June 3rd, 2014

Disclosure: We are short shares of Viggle, Inc (VGGL)

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Robert Sillerman’s Public Track Record 

RobertSillerman

Viggle

SFX

Entertainment

CKXEntertainment

Riviera

Holdings

CircleEntertainment

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Circle Entertainment

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SFX Entertainment

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Declining User Growth

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Declining User Engagement

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Decreased Transparency

(Metric) 6/30/2014 12/31/2014 3/31/2014

MAUs

✔  ✔  ✔ Time w/in App Per

session ✔  ✔  ✔ Engagements/Day

✔  ✖  ✖ Average Days

Active ✖ ✔ ✖

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What Do Employees Say?

• “Smart and vibrant team, shamefully wasted” 

 – “The product no long works well, and is anoutright embarrassment (see the reviews) the

user base is plummeting.• “Misery and frustration is rampant among

staff” 

• “I’m not optimistic about the outlook for thiscompany” 

Source: Glassdoor

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What Do Employees Say? (cont’d) 

• “Sinking Ship” 

• Pros: You work in a great neighborhood.

•

Cons: You work for Viggle, the worst companyof all time.

• Advice to Senior Management: Respect

human beings.Source: Glassdoor

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What Do Employees Say? (cont’d) 

• “Development team is poorly managed and

developers are not respected or trusted by

their own management (treated more as

resources than as people.”

• Management creates unrealistic schedules

and timelines and promotes them as accurate

throughout the company, then blamesdevelopers when dates aren’t met.” 

Source: Glassdoor

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Valuation

• Viggle currently trades at $5.73

• Market cap is $79 million

•

This puts Viggle’s P/S ratio at 4.59 

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Valuation

Base Case

• Base Case (Viggle trade in-

line with entertainment

stock peers)• Viggle P/S: 2.48

• Implied Share Price: $3.09

• Downside: -46%

Bear Case

• Bear Case (Viggle trades in-

line with S&P500 P/S)

• Viggle P/S: 1.56• Implied Share Price: $1.95

• Downside: -66%

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