TECHNOLOGY, MEDIA, & TELECOM...Criteo’spending acquisition of HookLogic HookLogic provides...

25
Investment banking services are provided by Harris Williams LLC, a registered broker-dealer and member of FINRA and SIPC, and Harris Williams & Co. Ltd, which is authorised and regulated by the Financial Conduct Authority. Harris Williams & Co. is a trade name under which Harris Williams LLC and Harris Williams & Co. Ltd conduct business. www.harriswilliams.com TECHNOLOGY, MEDIA, & TELECOM QUARTERLY INTERNET & DIGITAL MEDIA SECTOR REVIEW 3Q 2016 Investment banking services are provided by Harris Williams LLC, a registered broker-dealer and member of FINRA and SIPC, and Harris Williams & Co. Ltd, which is authorised and regulated by the Financial Conduct Authority. Harris Williams & Co. is a trade name under which Harris Williams LLC and Harris Williams & Co. Ltd conduct business. www.harriswilliams.com

Transcript of TECHNOLOGY, MEDIA, & TELECOM...Criteo’spending acquisition of HookLogic HookLogic provides...

Page 1: TECHNOLOGY, MEDIA, & TELECOM...Criteo’spending acquisition of HookLogic HookLogic provides closed-loop marketing for brand advertisers through its partnerships with leading retailers

Investment banking services are provided by Harris Williams LLC, a registered broker-dealer and member of FINRA and SIPC, and Harris Williams & Co. Ltd, which is authorised and regulated by the Financial Conduct Authority. Harris Williams & Co.is a trade name under which Harris Williams LLC and Harris Williams & Co. Ltd conduct business.

www.harriswilliams.com

TECHNOLOGY, MEDIA, & TELECOMQUARTERLY INTERNET & DIGITAL MEDIA SECTOR REVIEW │ 3Q 2016

Investment banking services are provided by Harris Williams LLC, a registered broker-dealer and member of FINRA and SIPC, and Harris Williams & Co. Ltd, which is authorised and regulated by the Financial Conduct Authority. Harris Williams & Co.is a trade name under which Harris Williams LLC and Harris Williams & Co. Ltd conduct business.

www.harriswilliams.com

Page 2: TECHNOLOGY, MEDIA, & TELECOM...Criteo’spending acquisition of HookLogic HookLogic provides closed-loop marketing for brand advertisers through its partnerships with leading retailers

PAGE |

TECHNOLOGY, MEDIA & TELECOM

QUARTERLY INTERNET & DIGITAL MEDIA SECTOR REVIEW │ 3Q 2016

CONTENTS

IDM OVERVIEW

WHAT WE’RE READING

SELECT M&A TRANSACTIONS – 3Q 2016

IDM M&A ACTIVITY

IDM SECTOR OVERVIEWS

IDM PRIVATE PLACEMENTS OVERVIEW

IDM PUBLIC COMPARABLES OVERVIEW

TECHNOLOGY IPO OVERVIEW

DEBT MARKET OVERVIEW

APPENDIX: PUBLIC COMPARABLES DETAIL

TMT CONTACTS

UNITED STATES

Jeff BistrongManaging [email protected]

Sam HendlerManaging [email protected]

Mike WilkinsManaging [email protected]

EUROPE

Thierry MonjauzeManaging [email protected]

TO SUBSCRIBE PLEASE EMAIL:*[email protected]

HARRIS WILLIAMS & CO. OVERVIEW

HARRIS WILLIAMS & CO. (HW&CO.) GLOBAL ADVISORY PLATFORM

HW&CO. TECHNOLOGY, MEDIA & TELECOM (TMT) GROUP FOCUS AREAS

SELECT 2016 AND 2015 HW&CO. TMT TRANSACTIONS

11

HW&Co. OfficeNetwork Office

SOFTWARE / SAAS

Enterprise Software

Data and Analytics

Infrastructure andSecurity Software

IT and Tech-enabledServices

Data Center andManaged Services

INTERNET & DIGITAL MEDIA

AdTech and MarketingSolutions

Data and InformationServices

eCommerce

Media, Content, andGaming

Education

Energy, Power, andInfrastructure

Fintech

Healthcare IT

Public Sector and Non-Profit

Supply Chain, Transportation,and Logistics

TMT VERTICAL FOCUS AREAS

Manufacturing

Professional Services

Approximately 250 professionals across eight offices in the U.S. and Europe

Strategic relationships inIndia and China

10 industry groups

KEY FACTS

has been acquired byhas been acquired byhas been

recapitalized by has been acquired by has been acquired by

Baarsma B2C trades as:

has been acquired byhas been acquired by has been acquired bypending

recapitalization byhas acquiredhas been

recapitalized byhas received a

majority investment from

Page 3: TECHNOLOGY, MEDIA, & TELECOM...Criteo’spending acquisition of HookLogic HookLogic provides closed-loop marketing for brand advertisers through its partnerships with leading retailers

PAGE |

TECHNOLOGY, MEDIA & TELECOM

QUARTERLY INTERNET & DIGITAL MEDIA SECTOR REVIEW │ 3Q 2016

HARRIS WILLIAMS & CO. INTERNET & DIGITAL MEDIA (IDM) OVERVIEW

2

SECTION CONTENTS

SELECT HW&CO. INTERNET & DIGITAL MEDIA TRANSACTIONS

Harris Williams & Co.’s Technology, Media & Telecom (“TMT”) Group is dedicated to providingsuperior merger & acquisition and capital markets advisory services to market leading companies.We are pleased to issue the 3Q 2016 Internet & Digital Media Sector Update, which providescommentary and analysis on the current IDM M&A environment and market trends.

ABOUT THE SECTORPrimary IDM Contact

Mike WilkinsManaging Director575 Market Street, 31st FloorSan Francisco, California 94105Office: 415.217.3411Mobile: [email protected]

Provider of

online

community

management

solutionshas been acquired by

Leading B2C

eCommerce

wine retail

platform in

Europehas been acquired by

Cloud-based

information

and analytics

platform for

the aviation

industryhas been acquired by

Provider of

data-driven

marketing and

analytics tools

to the

automotive

industry

has been acquired by

Baarsma B2C trades as:

• Proprietary Data Networks

• Community Based Information Services

Data and Information Services

• Advertising Networks and Search Portals

• Marketing Technology

AdTech and Marketing Solutions

• Digital Media

• Online Content

• Social Media

• Gaming

Media, Content, and Gaming

• Marketplace

• Travel

• eCommerce Enablement

• Flash Sales, Promotional, and Coupons

• Vertical eCommerce

eCommerce

Leading

inbound

demand

generation

and sales

conversion

platform

has been acquired by

Provider of B2B

news,

information,

data, software

and custom

content

solutions for

the travel

industry

has been acquired by

Page 4: TECHNOLOGY, MEDIA, & TELECOM...Criteo’spending acquisition of HookLogic HookLogic provides closed-loop marketing for brand advertisers through its partnerships with leading retailers

PAGE |

TECHNOLOGY, MEDIA & TELECOM

QUARTERLY INTERNET & DIGITAL MEDIA SECTOR REVIEW │ 3Q 2016

WHAT WE’RE READING

3

DOUBTS ABOUT DIGITAL ADS RISE OVER NEW REVELATIONS (SEPTEMBER 23, 2016)

In recent months, several significant revelations have further called into question the integrity of both reported advertising data and the reporting party: the revelations that Facebook overestimated the average time spent watching video ads on its platform by up to 80%; that Denstu overcharged at least 111 companies for internet ads; and that ad agencies may have accepted rebates from media companies without informing clients. These developments have all served to compound a mounting concern: that marketers are wasting billions of dollars on digital advertising. In light of this concern, calls for greater accountability and transparency have resounded amongst ad buyers, with some voicing support for broader third-party verification. Without a standardized currency on which to base performance, buyers are struggling to be able to judge the efficacy of their campaigns, and as decisions around budget allocation are further contemplated, the trumpeted value of digital advertising is being re-assessed by some.

The Wall Street Journal

Verizon is stepping up a $10 billion effort to build out its digital media business. The telecom giant’s apparent plan is to acquire, develop, and distribute creative content, while using the vast data collected from mobile phones to offer highly targeted advertising to its tens of millions of users. In so doing, Verizon is hoping to present itself as a strong contender to Facebook and Google as the three vie for advertising dollars—leveraging the diverse assets gained through Verizon’s notable acquisitions of AOL and Yahoo. The company’s digital media push comes in the midst of a 5% quarterly decline in revenue despite a 44% surge in smartphone data usage, signaling heightened competition in the sector. Indeed, collective performance has plateaued across the wireless industry, prompting other carriers to similarly seek out new avenues of strategic reinvention.

The Wall Street Journal

INSIDE VERIZON’S GAMBLE ON DIGITAL MEDIA (AUGUST 2, 2016)

HOW ARTIFICIAL INTELLIGENCE IS CHANGING ONLINE RETAIL FOREVER (OCTOBER 11, 2016)

Artificial intelligence (“A.I.”) is beginning to demonstrate a potentially transformative impact on online retail. Though the full implications of the technological trend for the sector have yet to be determined, its benefits are already becoming tangible. Even now, there are areas where A.I. is showing the ability to plug seamlessly into retailers’ existing online infrastructure and provide immediate value for businesses and consumers alike. As the applications of A.I. evolve, the purchasing lifecycle from product discovery to the logistics of delivery will be meaningfully impacted—providing early-adopters with clear advantages over those who choose to ignore its utility, while simultaneously introducing consumers to a new chapter of eCommerce, one that is increasingly more personalized and intuitive.

TechCrunch

HOW THE MEDIA WILL RISE IN THE FACE OF THE DIGITAL REVOLUTION (JULY 28, 2016)

Despite suffering a continued downturn since 2007, broadcasters and publishers may have cause for optimism in the near term. It is no secret that the ‘digital age’ has beset many media institutions with a series of challenges—declining advertising revenue brought on by channel proliferation, shifting consumer preferences in favor of ‘short-form’ content, heightened overall competition resulting from decreased barriers-to-entry, and others. However, several new developments are nevertheless believed to be signs of industry revitalization: newspaper digital readership has increased significantly amongst younger viewers, subscription models are demonstrating staying power with a growing number of online subscribers, and monetized social media content has the potential to powerfully augment existing advertising revenue streams. For some publications who have struggled to adapt to digital, the past few years have been unkind. Yet, for those who have proactively reconfigured themselves, the future may be brighter than previously thought.

TechCrunch

The contrasting narratives of Twitter and Snap illuminate recent dynamics in Silicon Valley M&A and valuation. Over time, as Twitter’s potential sale played out on a public stage, speculations regarding the various causes for the slow cooling of buyer interest began to center upon several issues, with one key issue amongst all: user growth. For Twitter, though revenue has more than tripled since its IPO, user growth has waned significantly. At filing in 2013, the company posted 39% year-over-year growth whereas, in the three months ended June 30th, that number has fallen significantly to 3% year-over-year growth. On the other hand, Snap is still riding high atop its 150 million daily active users and 30% user growth rate—supporting a potential valuation of $25 billion. The careful cultivation of momentum at Twitter, once valued at $40 billion, no longer sustains the company and, as observers continue to parse the company’s recent M&A difficulties, many are left to wonder if there aren’t insights to be gleaned regarding sky-high social media valuations.

The New York Times

TWITTER’S TROUBLES AND SNAP’S APPEAL: IT’S ALL ABOUT THE MOJO (OCTOBER 11, 2016)

Page 5: TECHNOLOGY, MEDIA, & TELECOM...Criteo’spending acquisition of HookLogic HookLogic provides closed-loop marketing for brand advertisers through its partnerships with leading retailers

PAGE |

TECHNOLOGY, MEDIA & TELECOM

QUARTERLY INTERNET & DIGITAL MEDIA SECTOR REVIEW │ 3Q 2016

Walmart’s pending acquisition of Jet.com

Jet.com operates an eCommerce marketplace that employs a unique system of pricing incentives to drive consumer spending.

The Company gained significant market share over a short period of time through an aggressive pricing strategy that was bolstered by a strong investor base and ample capital.

The investment represents a bold advancement of Walmart’s eCommerce operations as it steps up its online presence to compete with Amazon.Ent. Value: $3.3b

Revenue: est. $1.0b

EV / Revenue: 3.3x

EV / EBITDA: N/A

Announced 8/3/16

Salesforce completes acquisition of Demandware

Demandware provides enterprise-class cloud commerce solutions for retailers and branded manufacturers, including solutions for digital commerce and point of sale as well as order management and predictive intelligence capabilities.

The Company's platform offering, Demandware Commerce, is a combination of its cloud platform, community, and related services that enables customers to establish and execute complex digital commerce strategies.

The acquisition of Demandware will position Salesforce to capture the multi-billion dollar digital commerce market with the creation of the new Salesforce Commerce Cloud, which will be an integral part of its Customer Success Platform.Ent. Value: $2.7b

Revenue: $ 254m

EV / Revenue: 10.5x

EV / EBITDA: NM

Closed 7/11/16

Concur’s pending acquisition of Hipmunk

Hipmunk is a consumer-oriented online travel company providing users with hotel deals and flight results through its website and mobile application.

The Company delivers some of the most innovative functionality in the travel industry and is recognized as a leader in the cutting edge space of artificial intelligence-powered travel search and travel bots.

The acquisition of the Hipmunk team and their innovations will further Concur’s strategy to deliver consumer-grade products to corporate customers.Ent. Value: N/A

Revenue: N/A

EV / Revenue: N/A

EV / EBITDA: N/A

Announced 9/13/16

Dentsu Aegis’s pending acquisition of Merkle

Merkle operates as a customer relationship management agency that designs, executes, and evaluates integrated marketing programs.

As one of the largest independent digital agencies, Merkle manages 3.7 billion customer records across 16 offices supporting over 650 blue chip clients globally.

The acquisition will accelerate Dentsu Aegis’s strategy to become a 100% digital economy business by 2020, as well as significantly enhance their global operations.Ent. Value: $1.4b

Revenue: $436m

EV / Revenue: 3.3x

EV / EBITDA: N/A

Announced 8/8/16

Criteo’s pending acquisition of HookLogic

HookLogic provides closed-loop marketing for brand advertisers through its partnerships with leading retailers and travel companies.

HookLogic's performance marketing exchange connects many of the world's largest retail eCommerce sites with consumer brand manufacturers who vie for virtual shelf-space via sponsored product ads.

The acquisition gives Criteo access to HookLogic’s customer base and enables the integration of Criteo’s predictive bidding technology into HookLogic’s existing platform, which will help retailers to further monetize their site traffic.Ent. Value: $250m

Revenue: $111m

EV / Revenue: 2.2x

EV / EBITDA: N/A

Announced 10/4/16

SELECT IDM M&A TRANSACTIONS

4

Page 6: TECHNOLOGY, MEDIA, & TELECOM...Criteo’spending acquisition of HookLogic HookLogic provides closed-loop marketing for brand advertisers through its partnerships with leading retailers

PAGE |

TECHNOLOGY, MEDIA & TELECOM

QUARTERLY INTERNET & DIGITAL MEDIA SECTOR REVIEW │ 3Q 2016

IDM ACQUISITION ACTIVITY – STRATEGIC ACQUIRERS

MOST ACTIVE STRATEGIC ACQUIRERS OF IDM ASSETS BY VOLUME

GLOBAL STRATEGIC ACQUIRER IDM M&A ACTIVITY BY VOLUME

5

(Number of Transactions)

(Number of Transactions)

The ten most active strategic IDM buyers over the past several years have completed a combined 30 acquisitions in 2016 YTD.

Yahoo, alone among the group, has not completed an acquisition in 2016, likely attributable to the internal focus on the pending Verizon acquisition.

Google continues to lead the pack with thirteen acquisitions in 2016 YTD, including the purchase of Apigee, a provider of big data analytics and API Solutions.

3Q 2016 brings an uptick in activity over the prior quarter with strategic M&A activity increasing from 119 deals in 2Q 2016 to 141 in 3Q 2016.

3Q 2016 activity represents a 18.5% increase from 2Q 2016, however activity is still down 27.3% from the same period last year.

Buyers across each vertical have tended towards assets that enhance existing offerings / infrastructure by providing richer data sets, stronger analytics, broader reach, and a more expansive solutions portfolio.

3 4 2 36 4

1 2 1

5 4

12

33

1

7 7 16

5

4

2

23

3

17

9

9

64

1

43

24

7

41

2 2

34 2

3 4

13

2

6 2

21 2

1 1

2016 YTD

2015

2014

2013

2012

2011

148 142167 166

180206

185 189215

228

194

164

193

119141

Q1 - 13 Q2 - 13 Q3 - 13 Q4 - 13 Q1 - 14 Q2 - 14 Q3 - 14 Q4 - 14 Q1 - 15 Q2 - 15 Q3 - 15 Q4 - 15 Q1 - 16 Q2 - 16 Q3 - 16

Page 7: TECHNOLOGY, MEDIA, & TELECOM...Criteo’spending acquisition of HookLogic HookLogic provides closed-loop marketing for brand advertisers through its partnerships with leading retailers

PAGE |

TECHNOLOGY, MEDIA & TELECOM

QUARTERLY INTERNET & DIGITAL MEDIA SECTOR REVIEW │ 3Q 2016

IDM ACQUISITION ACTIVITY – PRIVATE EQUITY INVESTORS

MOST ACTIVE PRIVATE EQUITY INVESTORS OF NEW IDM PLATFORMS BY VOLUME

GLOBAL NEW PLATFORM PRIVATE EQUITY IDM M&A ACTIVITY BY VOLUME

6

(Number of Transactions)

(Number of Transactions)

Vista Equity Partners has continued to be the most active private equity acquirer of new IDM platforms in 2016 YTD with the addition of four more acquisitions to make eight for the year.

Collectively, the 10 most active private equity acquirers of IDM assets executed 25 platform acquisitions in 2016 YTD.

Of note in 3Q, Vista Equity Partners closed its high profile acquisition of Marketo, a leading provider of engagement marketing software and solutions.

Private equity investment in new IDM platforms remains low in 3Q 2016 registering only 10 transactions, down 47.4% and 41.1% in the same periods in 2015 and 2014, respectively.

Continued macroeconomic uncertainty due to the U.S. presidential election and Britain’s exit from the European Union has affected deal volumes. However, PE and VC activity are expected to pick-up in 4Q 2016.

25

74

1

5

1

8

1 1

2

3

3

4

1

2 2 2

55

33

1

2

1 2

5

7 5

5 3

7

3

1

44

6

4

17

6

2

6

3

33

8

2

5 0 5

2

2 1

2016 YTD

2015

2014

2013

2012

2011

12 11

28

2017

21

17 17 17

29

19

24

19

9 10

Q1 - 13 Q2 - 13 Q3 - 13 Q4 - 13 Q1 - 14 Q2 - 14 Q3 - 14 Q4 - 14 Q1 - 15 Q2 - 15 Q3 - 15 Q4 - 15 Q1 - 16 Q2 - 16 Q3 - 16

Page 8: TECHNOLOGY, MEDIA, & TELECOM...Criteo’spending acquisition of HookLogic HookLogic provides closed-loop marketing for brand advertisers through its partnerships with leading retailers

PAGE |

TECHNOLOGY, MEDIA & TELECOM

QUARTERLY INTERNET & DIGITAL MEDIA SECTOR REVIEW │ 3Q 2016

NOTABLE ADTECH AND MARKETING SOLUTIONS M&A TRANSACTIONS

ADTECH AND MARKETING SOLUTIONS – M&A MARKET SUMMARY

ADTECH AND MARKETING M&A VOLUME (GLOBAL) MEDIAN M&A REVENUE MULTIPLES (REPORTED)

7

(Number of Transactions) (Enterprise Value / Revenue) AdTech and Marketing

Solutions M&A deal volume fell for the third consecutive quarter in 3Q 2016.

Strategic acquirers continue to pace the market, comprising all but one of the highlighted deals for the quarter.

Despite a slight drop in deal volume, median transaction multiples increased for the second consecutive quarter, as buyers remain willing to pay premium valuations for high quality assets.

Google was a highly active acquirer in 3Q 2016, closing five transactions in the sector.

Larger transactions continued to command higher multiples, while deals valued under $100 million traded just over 1.0x revenue.

Large strategic acquirers continue to pursue comprehensive end-to-end offerings utilizing M&A to fill product gaps, while remaining disciplined as to avoid investing too early in emerging players.

DATE

CLOSED ACQUIRER DESCRIPTION

ENTERPRISE

VALUE (MM)TARGET

REVENUE

MULTIPLE

48 45

57

47 51

76

58

65

76

87

57

68

42

36 35

1Q '13 2Q '13 3Q '13 4Q '13 1Q '14 2Q '14 3Q '14 4Q '14 1Q '15 2Q '15 3Q '15 4Q '15 1Q '16 2Q '16 3Q '16

1.6x

2.8x

2.1x

3.6x

1.7x

2.8x

2.5x

1.6x

2.2x

1.9x

2.3x

3.0x

1.6x

2.2x

2.6x

1Q '13 2Q '13 3Q '13 4Q '13 1Q '14 2Q '14 3Q '14 4Q '14 1Q '15 2Q '15 3Q '15 4Q '15 1Q '16 2Q '16 3Q '16

MEDIAN

Pending Orient Hongtai Investment Mgmt. AppLovin Corp. Provides mobile marketing automation and analytics for brands seeking to reach new consumers. $1,400 6.0x

Pending Dentsu Aegis Network Ltd. Merkle Group, Inc. Develops content protection and contextual advertising technology solutions. $1,433 3.3x

Pending Criteo Corp. HookLogic, Inc. Provides closed-loop marketing for brand advertisers. $250 2.2x

Pending Xaxis LLC Triad Retail Media Creates, manages, and operates online media programs for eCommerce websites. $300 0.6x

09/27/16 Vector Capital Sizmek, Inc. Provides an independent global ad campaign and distribution platform. $75 0.4x

09/14/16 salesforce.com, inc. Gravity Tank, Inc. Offers and designs innovation consultancy and integrated marketing solutions. NA NA

09/03/16 GoDaddy, Inc. ManageWP LLC Offers site a full suite of solutions for WordPress automation. NA NA

09/01/16 Ligatus GmbH (Bertlesmann SE & Co.) LiquidM, Inc. Develops a mobile advertising management platform. NA NA

08/23/16 Endurance International Group, Inc. AppMachine BV Develops and publishes mobile applications. $38 NA

08/16/16 Vista Equity Partners Marketo, Inc. Provides a cloud-based marketing software platform. $1,498 6.6x

08/16/16 Nuance Communications, Inc. TouchCommerce, Inc. Provides digital customer service and engagement solutions. $195 NA

08/09/16 Gannett Co., Inc. ReachLocal, Inc. Offers comprehensive suite of online marketing solutions for SMBs. $156 0.4x

08/09/16 Monotype Imaging, Inc. Olapic, Inc. Helps brands analyze user-generated content across multiple marketing channels. $130 NA

08/04/16 Zeta Interactive LLC Acxiom Digital, Inc. Provides integrated digital marketing solutions. $50 1.2x

07/27/16 Google, Inc. Cluster Labs, Inc. Provides mobile photo sharing applications. NA NA

07/26/16 Taboola.com Ltd. ConvertMedia Provides a recommendation engine for online marketing videos. $100 2.0x

07/19/16 Accenture Plc MobGen BV Operates a digital and mobile marketing agency. NA NA

07/18/16 Luxoft Holding, Inc. INSYS Group, Inc. Provides predictive analytics, digital marketing, and enterprise information management. $71 1.3x

07/07/16 Google, Inc. Anvato, Inc. Develops content protection and contextual advertising technology solutions. NA NA

06/30/16 Pamlico Capital Prize Logic Provides digital promotions for large consumer brands and retailers. NA NA

$156 1.7x

Page 9: TECHNOLOGY, MEDIA, & TELECOM...Criteo’spending acquisition of HookLogic HookLogic provides closed-loop marketing for brand advertisers through its partnerships with leading retailers

PAGE |

TECHNOLOGY, MEDIA & TELECOM

QUARTERLY INTERNET & DIGITAL MEDIA SECTOR REVIEW │ 3Q 2016

NOTABLE DATA AND INFO SERVICES M&A TRANSACTIONS

DATA AND INFORMATION SERVICES – M&A MARKET SUMMARY

DATA AND INFO SERVICES M&A VOLUME (GLOBAL) MEDIAN M&A REVENUE MULTIPLES (REPORTED)

8

(Number of Transactions) (Enterprise Value / Revenue) Data and Information Services

M&A volume remained relatively flat in 3Q 2016, but the drop was minor compared to a larger decline in the prior quarter.

The number of private equitydeals remained steady at sixfor the quarter.

Median revenue multiples inthe sector reverted to theaggregate historical medianof 3.6x, in a possible cooling ofinvestor confidence.

Transactions involving datamanagement and analyticsproviders were particularlyfrequent this quarter relative todata collection, with buyerslike eBay, MagnitudeSoftware, and Zillow pursuingassets in the space.

The quarter was headlined byThomson Reuters’ sale of itsIntellectual Property & Sciencebusiness to Onex Corporationand Baring Private Equity Asiain a divestiture valued at $3.6billion.

45

38

60

41

44

65

60

52

57 59 60

58

64

42 41

1Q '13 2Q '13 3Q '13 4Q '13 1Q '14 2Q '14 3Q '14 4Q '14 1Q '15 2Q '15 3Q '15 4Q '15 1Q '16 2Q '16 3Q '16

2.7x

3.5x3.7x

4.5x

4.1x

2.1x2.3x

1.6x

3.5x

3.1x

4.4x

5.0x

4.6x

5.7x

3.6x

1Q '13 2Q '13 3Q '13 4Q '13 1Q '14 2Q '14 3Q '14 4Q '14 1Q '15 2Q '15 3Q '15 4Q '15 1Q '16 2Q '16 3Q '16

DATE

CLOSED ACQUIRER DESCRIPTION

ENTERPRISE

VALUE (MM)TARGET

REVENUE

MULTIPLE

MEDIAN

Pending Google, Inc. Apigee Corp. Provides application programming interface and predictive big data analytics technology. $472 5.1x

10/03/16 Onex Corp; Baring Private Equity Asia Thomson Reuters Provides comprehensive intellectual property and scientific decision support services. $3,550 3.6x

10/03/16 Quintiles Transnational Holdings, Inc. IMS Health Holdings, Inc. Provides data and information services to the healthcare industry. $12,905 4.2x

09/30/16 Accenture Plc New Energy Group Srl Provides information technology and digital transformation consultancy services. NA NA

09/07/16 XIO Group J.D. Power & Associates, Inc. Provides marketing information, customer surveys, and consulting services. $1,100 NA

09/06/16 Frontline Technologies Group LLC Excent Corp. Develops and provides data management software solutions. NA NA

09/06/16 Lieberman Research Worldwide LLC MotiveQuest LLC Provides social market research and consulting services. NA NA

08/01/16 X.commerce, Inc. RJ Metrics, Inc. Provides analytics software for online businesses. NA NA

08/25/16 Nielsen Holding France SAS A3 Distrib SASU Provides prospectus analysis services. NA NA

08/22/16 Thoma Bravo LLC Qlik Technologies, Inc. Designs and develops business intelligence software solutions. $2,525 4.0x

08/16/16 Magnitude Software, Inc. Simba Technologies, Inc. Supplies standards-based data access and analytics solutions and data connectivity services. NA NA

08/02/16 Zillow Group, Inc. Bridge Interactive Group LLC Provides brokers and MLS's with back-office data management software. NA NA

07/25/16 Datavail Corp. Art of BI Software LLC Provides oracle analytics consulting services. NA NA

07/31/16 Axel Springer SE eMarketer, Inc. Provides marketing insight and media research, analysis, and consultancy services. $269 5.9x

07/22/16 eBay, Inc. SalesPredict SW Ltd. Develops predictive analytics solutions. NA NA

07/18/16 Luxoft Holding, Inc. INSYS Group, Inc. Provides predictive analytics, digital marketing, and enterprise information management. $71 1.3x

07/12/16 IHS, Inc. Markit Ltd. Provides information, insights, and analytics. $6,177 5.5x

07/01/16 Asset International, Inc. Factset Market Metrics & Matrix Solutions Provides market research services and customer and business intelligence solutions. $175 NA

06/01/16 Market Track LLC Channel IQ Provides online retail intelligence, channel management, and brand protection solutions. NA NA

$1,100 4.2x

Page 10: TECHNOLOGY, MEDIA, & TELECOM...Criteo’spending acquisition of HookLogic HookLogic provides closed-loop marketing for brand advertisers through its partnerships with leading retailers

PAGE |

TECHNOLOGY, MEDIA & TELECOM

QUARTERLY INTERNET & DIGITAL MEDIA SECTOR REVIEW │ 3Q 2016

ECOMMERCE– M&A MARKET SUMMARY

ECOMMERCE M&A VOLUME (GLOBAL)

NOTABLE ECOMMERCE M&A TRANSACTIONS

MEDIAN M&A REVENUE MULTIPLES (REPORTED)

(Number of Transactions) (Enterprise Value / Revenue) eCommerce M&A volume

rebounded this quarter, with 42 deals, representing the highest volume year to date.

Revenue multiples remained strong, increasing to 6.7x, a premium relative to the historical median of 5.5x.

General consolidation has maintained across the sector as larger companies continue to seek out accretive structural additions that better equip them to reach and serve an evolving marketplace.

Oracle’s acquisitions of NetSuite and LogFire illustrate its continued drive to build a comprehensive suite of best-of-breed marketing and commerce solutions.

The quarter was characterized by several leading eCommerce players (Etsy, Rakuten, eBay) acquiring analytics-driven assets that help improve specific aspects of backend operations.

DATE

CLOSED ACQUIRER DESCRIPTION

ENTERPRISE

VALUE (MM)TARGET

REVENUE

MULTIPLE

MEDIAN

9

35 34

38

53 51

42 44

52

46

64

54

40

37 35

42

1Q '13 2Q '13 3Q '13 4Q '13 1Q '14 2Q '14 3Q '14 4Q '14 1Q '15 2Q '15 3Q '15 4Q '15 1Q '16 2Q '16 3Q '16

7.8x

5.7x

2.4x

5.5x

8.2x

7.4x

5.0x

5.8x

3.7x

4.2x

1.7x

4.3x

1.9x

6.3x6.7x

1Q '13 2Q '13 3Q '13 4Q '13 1Q '14 2Q '14 3Q '14 4Q '14 1Q '15 2Q '15 3Q '15 4Q '15 1Q '16 2Q '16 3Q '16

Pending Ritchie Bros. Auctioneers, Inc. IronPlanet, Inc. Operates an online marketplace for buying and selling used heavy equipment and trucks. $740 0.9x

10/03/16 Concur Technologies, Inc. Hipmunk, Inc. Provides closed-loop marketing for brand advertisers. NA NA

09/24/16 trivago GmbH Myhotelshop GmbH Provides an online marketing shop for the hotel industry. NA NA

09/19/16 Etsy, Inc. Blackbird Technologies, Inc. Develops search and recommendation technology for eCommerce Companies. NA NA

09/19/16 Wal-Mart Stores, Inc. Jet.com, Inc. Operates an eCommerce marketplace. $3,300 NA

09/06/16 Oracle Corp. LogFire, Inc. Provides cloud-based warehouse management applications for eCommerce companies. NA NA

09/05/16 Rakuten, Inc. Fablic, Inc. Develops an online flea market application. NA NA

09/05/16 Bregal Capital Onlineprinters Operates as a web-to-print service provider focused on B2B solutions. NA 10.5x

08/15/16 Agile Network LLC Ajillus, Inc. Designs and supplies software for shipping services. NA NA

08/10/16 Unilever Plc Dollar Shave Club, Inc. Delivers razors and other personal grooming products to consumers by mail. $1,000 6.6x

08/08/16 Google, Inc. Orbitera, Inc. Provides eCommerce, analytics, and cloud technologies for software vendors to assist in distribution. $100 NA

08/04/16 StubHub, Inc. Ticketbis SL Develops and operates an online ticket exchange platform. $165 6.4x

07/20/16 Expedia, Inc. Trover, Inc. Develops and markets online applications that collect and organize user generated travel information. NA NA

07/14/16 eBay, Inc. Ticket Utils, Inc. Provides a system to manage the distribution of tickets to multiple services. NA NA

07/12/16 Rakuten Marketing LLC Next Performance SAS Offers retargeting solutions for brands and retailers. NA NA

07/11/16 salesforce.com, inc. Demandware, Inc. Provides cloud-based digital commerce solutions for retailers and branded manufacturers. $2,670 10.5x

07/01/16 Stamps.com, Inc. ShippingEasy Group, Inc. Provides online shipping services. $63 NA

06/23/16 Providence Equity Partners LLC OEConnection LLC Offers eCommerce technology for OEM distribution networks. NA NA

06/20/16 JD.com, Inc. The Store Corp. Offers grocery, electronics, and apparel online. $2,918 NA

06/14/16 Bed Bath & Beyond, Inc. One Kings Lane, Inc. Engages in the online retail of home decor and furniture products. NA NA

$870 6.6x

Page 11: TECHNOLOGY, MEDIA, & TELECOM...Criteo’spending acquisition of HookLogic HookLogic provides closed-loop marketing for brand advertisers through its partnerships with leading retailers

PAGE |

TECHNOLOGY, MEDIA & TELECOM

QUARTERLY INTERNET & DIGITAL MEDIA SECTOR REVIEW │ 3Q 2016

NOTABLE MEDIA, CONTENT, AND GAMING M&A TRANSACTIONS

MEDIA, CONTENT, AND GAMING – M&A MARKET SUMMARY

MEDIA, CONTENT & GAMING M&A VOLUME (GLOBAL) MEDIAN M&A REVENUE MULTIPLES (REPORTED)

10

(Number of Transactions) (Enterprise Value / Revenue) Media, Content, and Gaming

volume grew over 44% in 3Q 2016 versus the prior quarter, with strategic deal volume alone growing over 50%.

After four very strong quarters,the median revenue multiplein Media, Content, andGaming has returned closer tothe aggregate historicalmedian of 3.8x.

Verizon’s ongoing acquisitionof Yahoo is part of a multi-billion dollar effort by Verizonto advance its mobile-firstcontent strategy—highlightinga contest amongst severallarger players (including AT&T)who endeavor to capture avaluable younger audience.

As major content providersand tech incumbents pushinto the realm of virtual reality,mobile and online gamingvaluations still remain strong.

DATE

CLOSED ACQUIRER DESCRIPTION

ENTERPRISE

VALUE (MM)TARGET

REVENUE

MULTIPLE

MEDIAN

50

56 58

65

61

77

68 67

80

85

62

53

84

38

58

1Q '13 2Q '13 3Q '13 4Q '13 1Q '14 2Q '14 3Q '14 4Q '14 1Q '15 2Q '15 3Q '15 4Q '15 1Q '16 2Q '16 3Q '16

2.7x

4.8x

2.0x

3.8x

2.9x

2.6x

4.7x

2.7x

3.7x

2.5x

6.0x

4.8x5.1x

4.2x

3.9x

1Q '13 2Q '13 3Q '13 4Q '13 1Q '14 2Q '14 3Q '14 4Q '14 1Q '15 2Q '15 3Q '15 4Q '15 1Q '16 2Q '16 3Q '16

Pending Shanghai Giant Network Technology Playtika Ltd. Develops online social networking games. $4,400 4.9x

Pending AVI Partners LLC YuMe, Inc. Provides digital video brand advertising solutions. $117 0.7x

Pending Verizon Communications Yahoo! Inc Provides information content, online search, maps, shopping, and other web-based services. $4,826 1.0x

Pending Tencent Holdings Ltd. China Music Co. Provides online music services in China. $2,700 NA

Pending Microsoft Corp. LinkedIn Corp. Operates an online professional network. $24,386 7.6x

Pending Internet Brands, Inc. Fodors LLC Markets and publishes content for the travel and tourism industry. NA NA

Pending Informa Plc Penton Business Media, Inc. Provides business-to-business digital and print media platform. $1,557 NA

Pending Wanda Cinema Line Co. Ltd. Mtime.com, Inc. Operates an online movie marketing and media platform. $350 NA

09/22/16 Verizon Communications Complex Media, Inc. Provides a multi-media platform for its audience targeting young male consumers. $300 NA

09/19/16 Facebook, Inc. Nascent Objects, Inc. Provides custom computer programming services. NA NA

09/14/16 Glu Mobile, Inc. Poke Radar Develops and publishes free-to-play games for smartphones. NA NA

08/11/16 Microsoft Corp. Beam Interactive, Inc. Develops live video streaming platform for gamers. NA NA

07/25/16 Tencent Holdings Ltd. Supercell Oy Provides online browser-based games for iPhone and iPad devices. $10,111 NA

07/25/16 Playtech Plc Best Gaming Technology GmbH Provides software and technology related to sports betting and gaming. $170 3.7x

07/12/16 NBCUniversal Media LLC Sport Ngin, Inc. Provides online software technology to manage youth and amateur sports leagues. NA NA

07/07/16 Google, Inc. Anvato, Inc. Develops content protection and contextual advertising technology solutions. NA NA

06/28/16 AT&T, Inc. QuickPlay Media, Inc. Provides mobile interactive multimedia services. NA NA

06/20/16 Bankrate, Inc. NextAdvisor, Inc. Provide online sources for reviews of credit cards, personal finance, and interest services. $225 NA

06/20/16 Twitter, Inc. Magic Pony Technology Ltd. Develops machine-learning based approaches for visual processing. $150 NA

06/17/16 Cision US, Inc. PR Newswire Association LLC Distributes news releases and other marketing messages for companies. $872 2.9x

$1,557 3.7x

Page 12: TECHNOLOGY, MEDIA, & TELECOM...Criteo’spending acquisition of HookLogic HookLogic provides closed-loop marketing for brand advertisers through its partnerships with leading retailers

PAGE |

TECHNOLOGY, MEDIA & TELECOM

QUARTERLY INTERNET & DIGITAL MEDIA SECTOR REVIEW │ 3Q 2016

10/04/16 eCommerce E $40 $90 Foundry Group, Menlo Ventures, Madrona Venture

Group

Provides an online platform to connect pet owners with

dog walkers and sitters.

09/26/16 eCommerce Late Stage $189 $517 JP Morgan Asset Management, W Capital Partners,

American Association of Retired Persons

Provides an online retail platform to sell food and

grocery products.

09/21/16

AdTech &

Marketing

Solutions

E $35 $113

Georgian Partners, Bain Capital Ventures, Battery

Ventures, Presidio Ventures, Silver Lake, Tenaya

Capital

Provides web analytics and digital marketing software.

09/20/16 eCommerce E $50 $218

Altimeter Capital, Foxhaven Asset Management, L

Catterton, General Catalyst Partners, Allen &

Company

Provides an online used-car marketplace.

09/19/16 eCommerce D $15 $76 Bessemer Venture Partners, Accel Partners, SAIF

Partners, Norwest Venture Partners, Apoletto Asia

Provides a platform for online ordering and delivery

serv ices from restaurants.

09/14/16

AdTech &

Marketing

Solutions

C $32 $51 Innovation Endeavors Management Company,

Marker, Lightspeed Venture PartnersProvides a cross-channel marketing analytics platform.

09/08/16

AdTech &

Marketing

Solutions

D $35 $74

General Atlantic, Salesforce Ventures, Causeway

Media Partners, Charles River Ventures, and other

investors

Provides a mobile marketing automation and loyalty

platform.

09/08/16 eCommerce C $119 $211

Altimeter Capital, GGV Capital, Warburg Pincus,

Andreessen Horowitz, Coatue Management, T

Rowe Price, Vy Capital

Provides a mobile marketplace to buy and sell items

locally.

09/01/16Media, Content

& GamingLate Stage $153 $780

Revolution Ventures and other undisclosed

investorsProvides an online fantasy sports betting platform.

09/01/16

Data &

Information

Serv ices

Late Stage $45 $195

FS Investments, Capital Partners, Cerberus PNC

Senior Loan Fund and PNC Bank, National

Association

Helps leading brands acquire, grow and retain

customers through predicitive analytics and targeted

advertising.

08/11/16 eCommerce E $45 $126 Turner, Scripps NetworksProvides a platform for fashion and lifestyle news,

trends, and shopping.

07/20/16

Data &

Information

Serv ices

F $105 $229

Temasek, Wellington Management Company, EDBI,

Battery Ventures, Intel Capital, Iconiq Capital, and

other investors

Offers a platform providing social governance,

engagement, audience management, analytics, and

integration.

06/28/16 eCommerce F $555 $4,067 Google Capital, Technology Crossover VenturesOperates an online property rental marketplace for

short-term travel stays.

06/27/16Media, Content

& GamingD $53 $183

J.P. Morgan, Andreessen Horowitz, Index Ventures,

Two Sigma

Develops A.I. technology that can be used in consumer

products, including v ideo games.

SELECT RECENT IDM PRIVATE PLACEMENTS

11

Note: Financial information presented above represents reported capital raised only.

DESCRIPTIONTOTAL

RAISED ($M)DATE COMPANY SECTOR ROUND

ROUND

SIZE ($M)INVESTORS (CURRENT ROUND)

Page 13: TECHNOLOGY, MEDIA, & TELECOM...Criteo’spending acquisition of HookLogic HookLogic provides closed-loop marketing for brand advertisers through its partnerships with leading retailers

PAGE |

TECHNOLOGY, MEDIA & TELECOM

QUARTERLY INTERNET & DIGITAL MEDIA SECTOR REVIEW │ 3Q 2016

PUBLIC IDM VALUATION MULTIPLES BY SECTOR

LTM EBITDA MULTIPLE ANALYSIS 3Q 2016 VS. 3Q 2015

LTM REVENUE MULTIPLE ANALYSIS 3Q 2016 VS. 3Q 2015STOCK PERFORMANCE (1- & 3-YEAR)

12

As of September 30, 2016.

8.1x

5.0x

4.4x 4.4x

3.6x

2.5x

1.8x 2.0x 2.2x 2.3x

1.7x 1.8x

1.0x

9.9x

6.5x

5.5x

4.2x3.9x

3.2x2.7x

2.5x 2.5x 2.3x 2.2x

1.2x 1.2x

Social Media Bellwethers Search Portals Travel Community Info Marketplace Gaming Digital Media Data Networks Local Online VerticaleCommerce

Marketing Tech Promotional

3Q 2015 3Q 2016

21.3x

35.3x

15.6x17.9x

12.5x

20.2x

11.8x15.1x 14.3x 14.6x

16.3x

29.6x

10.2x

22.0x

27.1x

17.5x19.5x

13.3x

20.5x

16.3x14.7x

15.7x16.2x

19.4x

12.1x10.2x

Social Media Bellwethers Search Portals Travel Community Info Marketplace Gaming Digital Media Data Networks Local Online VerticaleCommerce

Marketing Tech Promotional

3Q 2015 3Q 2016

41.0%

45.1%

40.7%

33.4%

5.1%

9.8%

43.4%

0.8%

(0.7%)

9.8%

25.0%

(7.1%)

47.9%

36.8%

117.8%

20.2%

48.8%

(7.9%)

16.5%

135.4%

2.8%

0.1%

(47.9%)

2.9%

(53.4%)

(63.6%)

Social Media

Bellwethers

Search Portals

Travel

Community Info

Marketplace

Gaming

Digital Media

Data Networks

Local Online

Vertical eCommerce

Marketing Tech

Promotional

1-Year Performance 3-Year Performance

Page 14: TECHNOLOGY, MEDIA, & TELECOM...Criteo’spending acquisition of HookLogic HookLogic provides closed-loop marketing for brand advertisers through its partnerships with leading retailers

PAGE |

TECHNOLOGY, MEDIA & TELECOM

QUARTERLY INTERNET & DIGITAL MEDIA SECTOR REVIEW │ 3Q 2016

`

KEY METRICS BY SECTOR – COMPARABLE PUBLIC IDM COMPANIES

EV / LTM REVENUE MULTIPLE NTM REVENUE GROWTH LTM EBITDA MARGINNTM EBITDA GROWTH NTM REVENUE GROWTH LTM EBITDA MARGINNTM EBITDA GROWTH

COMP SET MEDIANS CORRELATION WITH EV / REVENUE MULTIPLE

13

As of September 30, 2016.

9.9x

6.5x

5.5x

4.2x

3.9x

3.2x

2.7x

2.5x

2.5x

2.3x

2.2x

1.2x

1.2x

Social Media

Bellwethers

Search Portals

Travel

Community Info

Marketplace

Gaming

Digital Media

Data Networks

Local Online

Vertical eCommerce

Marketing Tech

Promotional

27% 37% 17% 64% 71% 5%

13% 37% 21% 46% - 78%

12% 17% 27% - 54% -

9% 5% 14% 70% - 15%

5% 8% 26% - - 88%

28% 14% 20% 12% 23% 76%

16% 12% 27% 79% - -

11% 21% 16% 76% 39% 86%

12% 22% 14% 46% 34% -

25% 34% 15% 67% - 43%

9% 31% 13% 77% 19% 82%

18% 22% 18% 51% 7% 89%

14% 88% 7% 51% - -

Page 15: TECHNOLOGY, MEDIA, & TELECOM...Criteo’spending acquisition of HookLogic HookLogic provides closed-loop marketing for brand advertisers through its partnerships with leading retailers

PAGE |

TECHNOLOGY, MEDIA & TELECOM

QUARTERLY INTERNET & DIGITAL MEDIA SECTOR REVIEW │ 3Q 2016

SUMMARY OF TECHNOLOGY IPOS

The IPO market showed signs of renewed life in 3Q 2016, with eight technology companies going public.

Notable IPOs included Line, which priced at $32 at the beginning of July; Talend, which priced at $18 per share at the end of July; and Nutanix, which priced at $16 per share at the end of September and has registered an impressive 131% growth in share price since listing.

The successful IPO of Nutanix as well as the sustained success of Twilio, which currently trades at over 300% of its offer price, may renew comfort around the IPO market, particularly as venture capital funding slows.

The resulting impact from the US Presidential election may shorten the promising IPO window that the last two quarters have created.

MARKET CAP AT IPO (LTM) REVENUE GROWTH (1YR PRIOR TO IPO)OFFERING SIZE AT IPO (LTM)

RECENT U.S. IPO ACTIVITY (BY OFFERING SIZE)

24%

29%

47%

< 25% 25 - 75% > 75%

6%

44%

17%

33%

$0-50M $50-500M $500M-$1B $1B+

8%

23%

38%

31%

$0 - 50M $50 - 100M $100 - 250M $250M +

(All tech IPOs over the last 12 months) (All tech IPOs over the last 12 months) (All tech IPOs over the last 12 months)

6

16

13 13

11

18

7

11

5

15

3

8

0

2

8

1Q-13 2Q-13 3Q-13 4Q-13 1Q-14 2Q-14 3Q-14 4Q-14 1Q-15 2Q-15 3Q-15 4Q-15 1Q-16 2Q-16 3Q-16

$0 - 50M $50 - 100M $100 - 250M $250M +

2013 Total: 48 2014 Total: 47 2016 Total: 102015 Total: 31

14

Page 16: TECHNOLOGY, MEDIA, & TELECOM...Criteo’spending acquisition of HookLogic HookLogic provides closed-loop marketing for brand advertisers through its partnerships with leading retailers

PAGE |

TECHNOLOGY, MEDIA & TELECOM

QUARTERLY INTERNET & DIGITAL MEDIA SECTOR REVIEW │ 3Q 2016

11/6/13 1/23/14 3/6/14 3/27/14 4/1/14 7/17/14 7/23/14 9/18/14 10/1/14 10/9/14 12/10/14 3/5/15 3/19/15 4/15/15 5/20/15 7/1/15 11/18/15 11/18/15 7/11/16

$26.0 $17.0 $16.0 $14.0 $15.0 $7.0 $11.0 $68.0 $29.0 $25.0 $15.0 $11.5 £3.5 $16.0 $17.0 $26.0 $9.0 $12.0 $32.8

$1,820.0 $91.0 $168.0 $0.0 $101.6 $43.8 $91.7 $21,767.2 $319.0 $125.0 $870.0 $74.8 £2,042.0 $266.7 $130.9 $192.5 $243.0 $400.0 $1,140.5

(11.3%) (41.4%) (16.8%) (45.1%) (44.8%) 33.9% (15.1%) 55.6% 35.8% 130.5% (58.8%) (22.4%) 52.2% (10.8%) 152.5% 65.3% 29.6% 48.3% 47.4%

Circle Size Denotes Revenue ($)

% R

eve

nu

e G

row

thSto

ck

Pe

rfo

rma

nc

e

KEY PERFORMANCE METRICS FOR RECENT IDM IPOS

IPO DATE

OFFER PRICE

OFFERING SIZE ($M)

OFFER TO CURRENT

15

As of September 30, 2016.

(11.3%)

(41.4%)

(16.8%)

(45.1%) (44.8%)

33.9%

(15.1%)

55.6%

35.8%

130.5%

(58.8%)

(22.4%)

52.2%

(10.8%)

152.5%

65.3%

29.6%

48.3% 47.4%

117.4%

68.0%

49.7%

12.5%

43.5%

90.5%

47.3%

51.3%

52.4% 50.4%

72.5%

61.1%

9.1%

53.2%

106.2%

53.3%

107.0%

10.6%

22.2%

(20.0%)

0.0%

20.0%

40.0%

60.0%

80.0%

100.0%

120.0%

140.0%

160.0%

98.3%

(23.2%)

32.0%

(1.2%)

53.0%

33.1%

3.3%

(29.7%)

(41.6%)

14.7% 14.7%

(1.2%)

7.4%

17.5%

9.9%

(125.0%)

(100.0%)

(75.0%)

(50.0%)

(25.0%)

0.0%

25.0%

50.0%

75.0%

100.0%

125.0%

Page 17: TECHNOLOGY, MEDIA, & TELECOM...Criteo’spending acquisition of HookLogic HookLogic provides closed-loop marketing for brand advertisers through its partnerships with leading retailers

PAGE |

TECHNOLOGY, MEDIA & TELECOM

QUARTERLY INTERNET & DIGITAL MEDIA SECTOR REVIEW │ 3Q 2016

14.2%

7.7%

13.4%

13.9%

15.3%

16.8%

18.7%

Other

Food & Beverage

Services & Leasing

Automotive

Technology

Insurance

Healthcare

63% 60%

50%

57%

55%

60%

66%

60% 58%

52%

2007 2008 2009 2010 2011 2012 2013 2014 2015 3Q'16

4.1x 4.0x

3.4x

3.8x 3.8x

4.3x

4.7x 4.7x

5.6x

4.5x

3.3x

4.2x 4.3x4.5x

4.8x

5.3x 5.3x

4.9x

1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 YTD16

FLD/EBITDA SLD/EBITDA Other Sr Debt/EBITDA Sub Debt/EBITDA

LBO LOAN VOLUME BY INDUSTRY MEDIAN LBO DEBT PERCENTAGES

DEBT MARKET OVERVIEW

MIDDLE MARKET LBO LOAN MULTIPLES MIDDLE MARKET LBO VOLUME BY QUARTER

1H 2016 New-Issue LBO Loan Volume: $1.5 billion Percentage of Total Purchase Price

Median middlemarket LBO loanmultiples tightened inYTD 2016 to 4.9x totalleverage.

Middle market LBOloan volume in 3Q2016 remained flatcompared to 2Q, with$0.5 billion of issuance.

Technologycompanies were thethird largest recipientsof LBO loans in YTD2016.

The median LBO debtpercentage through3Q 2016 was 52%, inline with the recenttrend of lendersrequiring larger equitycontributions fromsponsors.

Defined as Issuers with EBITDA of $50 Million or LessDefined as Issuers with EBITDA of $50 Million or Less

$0.7B

$1.0B

$2.0B

$1.2B

$1.6B$1.5B

$1.8B

$1.2B

$1.9B$2.0B

$0.4B

$0.9B

$0.5B$0.5B

2Q'13 3Q'13 4Q'13 1Q'14 2Q'14 3Q'14 4Q'14 1Q'15 2Q'15 3Q'15 4Q'15 1Q'16 2Q'16 3Q'16

Institutional Pro Rata

16

Page 18: TECHNOLOGY, MEDIA, & TELECOM...Criteo’spending acquisition of HookLogic HookLogic provides closed-loop marketing for brand advertisers through its partnerships with leading retailers

PAGE | 17

TECHNOLOGY, MEDIA, & TELECOM

QUARTERLY INTERNET & DIGITAL MEDIA SECTOR REVIEW │ 3Q 2016

SELECT HW&CO. TMT TRANSACTIONS

has been acquired by

DIGITAL

MEDIA

has merged with

SUPPLY CHAIN

SOFTWARE

ERP / BUSINESS

MANAGEMENT

has received a

significant equity

investment from

has been acquired by

NON-PROFIT

SOFTWARE

has been acquired by

INFRASTRUCTURE

SOFTWARE

has merged with

DIGITAL

MEDIA

has been

recapitalized by

SUPPLY CHAIN

SOFTWARE

has been acquired by

FINANCIAL

TECHNOLOGY

has been acquired by

HEALTHCARE

TECHNOLOGY

has been acquired by

DATA

ANALYTICS

has been acquired by

INFRASTRUCTURE

SOFTWARE

has been acquired by

ERP / BUSINESS

MANAGEMENT

has been acquired by

HEALTHCARE

TECHNOLOGY

has received a

majority investment

from

MARKETING

ANALYTICS

has been acquired by

HEALTHCARE

TECHNOLOGY

has been acquired by

HEALTHCARE

TECHNOLOGY

HEALTHCARE

TECHNOLOGY

has been acquired by

has been

recapitalized by

NON-PROFIT

SOFTWARE

has been acquired by

HCM SOFTWARE

has received an

investment from

APPLICATION

SOFTWARE

has been acquired by

ENERGY

TECHNOLOGY

has been acquired by

REAL ESTATE

SOFTWARE

has been acquired by

HEALTHCARE

TECHNOLOGY

has been acquired by

EDUCATION

TECHNOLOGY

has been acquired by

EDUCATION

TECHNOLOGY

has been acquired by

INFRASTRUCTURE

SOFTWARE

has been acquired by

HEALTHCARE

TECHNOLOGY

has been acquired by

TECH-ENABLED

SERVICES

has been acquired by

FINANCIAL

TECHNOLOGY

has been acquired by

MARKETING

ANALYTICS

has been acquired by

HEALTHCARE

TECHNOLOGY

has become a wholly-

owned subsidiary of

ENERGY

TECHNOLOGY

has been acquired by

ERP / BUSINESS

MANAGEMENT

has acquired

HEALTHCARE

TECHNOLOGY

has been acquired by

ECOMMERCE

RETAIL

has received a minority

equity investment from

HEALTHCARE

TECHNOLOGY

has been acquired by

LEGAL

TECHNOLOGY

has been acquired by

MARKETING

TECHNOLOGY

HCM SOFTWARE

has been acquired by

IT SERVICES

has been acquired by

has been acquired by

HEALTHCARE

TECHNOLOGY

has received a minority

investment from

ENERGY

TECHNOLOGY

has been acquired by

DATA

ANALYTICS

has been acquired by

HEALTHCARE

TECHNOLOGY

has acquired

HEALTHCARE

TECHNOLOGY

has been acquired by

MANAGED

SERVICES

has been acquired by

HEALTHCARE

TECHNOLOGY

to be acquired by

HEALTHCARE

TECHNOLOGY

has been

recapitalized by

NON-PROFIT

SOFTWARE

has received a

majority investment

from

HEALTHCARE

TECHNOLOGY

Page 19: TECHNOLOGY, MEDIA, & TELECOM...Criteo’spending acquisition of HookLogic HookLogic provides closed-loop marketing for brand advertisers through its partnerships with leading retailers

PAGE |

TECHNOLOGY, MEDIA & TELECOM

QUARTERLY INTERNET & DIGITAL MEDIA SECTOR REVIEW │ 3Q 2016

APPENDIX: INTERNET & DIGITAL MEDIA SECTOR PUBLIC COMPANY UNIVERSE

eC

om

me

rce

18

Me

dia

/ C

on

ten

t /

Ga

min

g

Ad

Tec

h&

M

ark

etin

g

So

lutio

ns

Da

ta &

In

form

atio

n

Se

rvic

es

Internet Bellwethers Alphabet Amazon.com Facebook Yahoo!

Marketplace Amazon.com Alibaba Group eBay JD.com Rakuten Liberty Interactiv e MercadoLibre 58.com Shopify LendingClub

Marketplace (cont'd) Cnov a Wayfair Ov erstock.com

Trav el Priceline Ctrip.com Expedia TripAdv isor MakeMyTrip Trav elzoo

Flash Sales / Promotional / Coupons GrouponQuotient

TechnologyRetailMeNot

Vertical eCommerce GrubHub Cimpress Shutterstock Stamps.com Etsy Shutterfly Chegg PetMed Express Blue Nile1-800-

FLOWERS.COM

Vertical eCommerce (cont'd) eHealth

Digital Media & Online Content Tencent SINA Corporation IAC Pandora WebMD Health Sohu.com XO Group Blucora Ev eryday Health TechTarget

Digital Media & Online Content (cont'd) Demand Media Townsquare Media

Social Media Facebook Twitter Weibo Momo Match Group Spark

Gaming Nintendo Activ ision Blizzard NetEase Electronic Arts Ubisoft

Entertainment

Take-Two

Interactiv e Zynga GREE Glu Mobile

Proprietary Data Networks Alliance Data Acxiom comScore Neustar YouGov Plc

Community Based Information Serv ices CoStar Group Zillow Group Auto Trader Group Rightmov e Yelp Moneysupermarket 51job Autohome Bankrate Angie's List

Community Based Information Serv ices

(cont'd)DHI Group Monster Worldwide Care.com

Adv ertising Networks / Search Portals Alphabet Baidu, Inc. Yahoo! Nav er Yahoo! Japan Yandex N.V.

Marketing Technology Adobe Criteo SA HubSpot Bazaarv oice The Rubicon Project TubeMogul QuinStreet Rocket Fuel

Local Online Adv ertising GoDaddy Wix.com Endurance

InternationalWeb.com Tucows Marchex

Page 20: TECHNOLOGY, MEDIA, & TELECOM...Criteo’spending acquisition of HookLogic HookLogic provides closed-loop marketing for brand advertisers through its partnerships with leading retailers

PAGE |

TECHNOLOGY, MEDIA & TELECOM

QUARTERLY INTERNET & DIGITAL MEDIA SECTOR REVIEW │ 3Q 2016

Enterprise Market % of 52 1-Year Stock 3-Year Stock Revenue Growth LTM EBITDA Enterprise Value / Price /

Company Ticker Value Capitalization Week High Performance Performance LTM NTM Margin LTM Rev. 2016E Rev. LTM EBITDA Earnings

APPENDIX: INTERNET & DIGITAL MEDIA SECTOR PUBLIC COMPANY METRICS

MARKETING TECHNOLOGY

19

ADVERTISING NETWORKS / SEARCH PORTALS

Marketing

Technology

Advertising

Networks /

Search Portals

Local Online

Advertising

Internet

Bellwethers

LOCAL ONLINE ADVERTISING

INTERNET BELLWETHERS

Marketplace

Proprietary Data

Networks

Community

Based Info

Services

Travel

Flash Sales /

Promotional /

Coupons

Vertical

eCommerce

Digital Media &

Online Content

Social Media

Gaming

As of September 30, 2016.Enterprise value and market capitalization figures in millions USD.Market capitalization figures exclude non-traded shares

Alphabet Inc. GOOGL $482,470 $505,078 98.2% 25.2% 81.1% 11.8% (1.9%) 32.6% 5.7x 6.7x 17.5x 26.5x

Amazon.com, Inc. AMZN 406,268 396,947 99.7% 60.8% 160.9% 20.2% 27.9% 8.7% 3.2x 3.0x 36.5x NM

Facebook, Inc. FB 347,767 297,966 97.2% 41.0% 154.4% 43.8% 51.0% 52.0% 14.1x 12.8x 27.1x 39.8x

Yahoo! Inc. YHOO 35,975 41,022 95.9% 49.1% 25.6% 8.1% (29.6%) 4.8% 7.2x 10.3x NM NM

Median $377,018 $347,456 97.7% 45.1% 117.8% 16.0% 13.0% 20.6% 6.5x 8.5x 27.1x 33.2x

Alphabet Inc. GOOGL $482,470 $505,078 98.2% 25.2% 81.1% 11.8% (1.9%) 32.6% 5.7x 6.7x 17.5x 26.5x

Baidu, Inc. BIDU 58,242 49,463 83.5% 32.4% 14.8% 32.8% 3.1% 25.1% 5.4x 5.4x 21.4x 9.9x

Yahoo! Inc. YHOO 35,975 41,022 95.9% 49.1% 25.6% 8.1% (29.6%) 4.8% 7.2x 10.3x NM NM

NAVER Corp. 035420-KR 22,068 26,428 97.6% 72.7% 54.6% 17.9% 28.7% 27.7% 6.7x 6.0x 24.2x 43.0x

Yahoo Japan Corporation 4689-JP 19,413 22,610 79.4% 4.8% (31.1%) 52.2% 55.3% 26.2% 2.7x 2.4x 10.2x 21.3x

Yandex NV YNDX 6,190 5,815 88.2% 96.2% (44.4%) (25.8%) 20.0% 31.0% 5.4x 5.3x 17.4x 42.7x

Median $29,022 $33,725 92.1% 40.7% 20.2% 14.8% 11.5% 27.0% 5.5x 5.7x 17.5x 26.5x

Adobe Systems Incorporated ADBE $52,138 $53,969 98.9% 29.6% 107.0% 14.8% 23.1% 29.5% 9.4x 8.8x 31.9x 54.4x

Criteo SA CRTO 1,922 2,138 73.4% (4.0%) NA 36.0% 33.0% 9.7% 1.2x 2.7x 12.1x 26.5x

HubSpot, Inc. HUBS 1,926 2,037 95.9% 26.0% NA 57.0% 45.4% NM 7.8x 7.3x NM NM

Bazaarv oice, Inc. BV 436 490 98.8% 34.0% (38.8%) 4.5% 1.8% NM 2.2x 2.2x NM NM

Rubicon Project, Inc. RUBI 210 405 40.6% (42.1%) NA 98.3% 7.8% 17.9% 0.7x 0.8x 3.9x 17.2x

TubeMogul, Inc. TUBE 266 339 64.8% (10.2%) NA 58.2% 21.3% NM 1.3x 1.2x NM NM

QuinStreet, Inc. QNST 98 138 47.9% (45.8%) (68.0%) 5.5% 14.0% NM 0.3x 0.3x NM NM

Rocket Fuel, Inc. FUEL 126 117 47.1% (43.1%) (95.3%) 13.0% (42.7%) NM 0.3x 0.5x NM NM

Median $351 $447 69.1% (7.1%) (53.4%) 25.4% 17.7% 17.9% 1.2x 1.7x 12.1x 26.5x

GoDaddy, Inc. GDDY $4,014 $2,913 97.2% 36.5% NA 15.9% 14.8% 11.7% 2.2x 2.2x 19.3x NM

Wix.com Ltd. WIX 1,658 1,844 87.8% 148.2% NA 43.5% 37.5% NM 6.9x 5.9x NM NM

Endurance International Group Holdings, Inc.EIGI 3,156 1,236 56.5% (32.7%) NA 17.7% 50.1% 17.0% 3.1x 2.8x 18.3x NM

Web.com Group, Inc. WEB 1,541 872 69.1% (17.0%) (47.9%) (0.1%) 36.0% 19.6% 2.3x 2.1x 11.9x 11.0x

Tucows Inc. TCX 350 334 94.3% 37.1% 234.7% 17.1% 10.5% 13.6% 1.9x 1.8x 14.1x 29.3x

Marchex, Inc. MCHX 25 105 53.9% (30.9%) (61.3%) (18.4%) (10.2%) NM 0.2x 0.2x NM NM

Median $1,599 $1,054 78.4% 9.8% (47.9%) 16.5% 25.4% 15.3% 2.3x 2.1x 16.2x 20.2x

Page 21: TECHNOLOGY, MEDIA, & TELECOM...Criteo’spending acquisition of HookLogic HookLogic provides closed-loop marketing for brand advertisers through its partnerships with leading retailers

PAGE |

TECHNOLOGY, MEDIA & TELECOM

QUARTERLY INTERNET & DIGITAL MEDIA SECTOR REVIEW │ 3Q 2016

APPENDIX: INTERNET & DIGITAL MEDIA SECTOR PUBLIC COMPANY METRICS

PROPRIETARY DATA NETWORKS

20

COMMUNITY BASED INFORMATION SERVICES

MARKETPLACE

Marketing

Technology

Advertising

Networks /

Search Portals

Local Online

Advertising

Internet

Bellwethers

Marketplace

Proprietary Data

Networks

Community

Based Info

Services

Travel

Flash Sales /

Promotional /

Coupons

Vertical

eCommerce

Digital Media &

Online Content

Social Media

Gaming

Enterprise Market % of 52 1-Year Stock 3-Year Stock Revenue Growth LTM EBITDA Enterprise Value / Price /

Company Ticker Value Capitalization Week High Performance Performance LTM NTM Margin LTM Rev. 2016E Rev. LTM EBITDA Earnings

As of September 30, 2016.Enterprise value and market capitalization figures in millions USD.Market capitalization figures exclude non-traded shares

Alliance Data Systems Corporation ADS $22,753 $12,556 70.6% (18.2%) 0.1% 21.4% 11.6% 27.8% 3.2x 3.2x 11.6x 22.2x

Acxiom Corporation ACXM 2,147 2,063 97.8% 35.4% (7.3%) 5.6% 2.5% 13.8% 2.5x 2.5x 17.9x NM

comScore, Inc. SCOR 1,047 1,737 59.7% (34.6%) 5.4% 12.1% 33.0% 7.1% 2.9x 2.1x 40.7x NM

NeuStar, Inc. NSR 2,338 1,449 88.3% (0.7%) (45.7%) 9.0% 17.1% 38.1% 2.0x 1.9x 5.3x 9.3x

YouGov plc YOU-GB 271 283 97.3% 55.1% 145.5% 15.9% (13.3%) 13.4% 2.1x 2.3x 15.7x 57.0x

Median $2,147 $1,737 88.3% (0.7%) 0.1% 12.1% 11.6% 13.8% 2.5x 2.3x 15.7x 22.2x

CoStar Group, Inc. CSGP $6,838 $7,060 96.3% 27.3% 26.4% 23.6% 17.8% 25.4% 8.4x 8.2x 33.2x 89.9x

Zillow Group, Inc. ZG 6,319 6,016 86.1% 24.5% 27.3% 97.8% 29.9% NM 8.0x 7.5x NM NM

Auto Trader Group PLC AUTO-GB 5,828 5,206 77.8% 2.3% NA 2.6% (7.1%) 63.7% 13.7x 15.0x 21.6x 27.3x

Rightmov e plc RMV-GB 5,214 5,147 86.5% (0.5%) 42.8% 15.0% (3.8%) 73.7% 17.0x 18.5x 23.1x 28.8x

Yelp Inc. YELP 3,025 3,263 99.4% 99.8% (41.4%) 45.6% 28.8% 2.1% 4.5x 4.3x NM NM

Moneysupermarket.com Group plc MONY-GB 2,126 2,134 70.6% (22.9%) 57.9% 13.5% (7.9%) 38.6% 4.9x 5.4x 12.6x 20.3x

51job Inc JOBS 1,317 1,986 94.1% 21.3% (7.8%) 10.1% 5.5% 29.4% 3.9x 3.8x 13.3x 20.2x

Autohome, Inc. ATHM 2,243 1,249 64.3% (25.0%) NA 59.4% 51.5% 28.6% 3.3x 2.7x 11.4x 7.9x

Bankrate, Inc. RATE 913 765 53.7% (18.0%) (59.2%) (32.0%) 14.5% 26.0% 3.3x 2.2x 12.7x NM

Angie's List, Inc. ANGI 610 583 88.1% 99.0% (51.2%) 9.2% (3.7%) 5.0% 1.8x 1.8x 36.3x NM

DHI Group, Inc. DHX 438 395 75.3% 5.1% (8.0%) (1.1%) (9.7%) 22.3% 1.8x 1.9x 8.3x NM

Monster Worldwide, Inc. MWW 411 322 46.6% (43.5%) (17.8%) (13.4%) (7.8%) 7.6% 0.7x 0.7x 8.9x NM

Care.com, Inc. CRCM 263 285 83.0% 94.2% NA 18.8% 15.6% 6.4% 1.8x 1.6x 27.9x 21.9x

Median $2,126 $1,986 83.0% 5.1% (7.9%) 13.5% 5.5% 25.7% 3.9x 3.8x 13.3x 21.9x

Amazon.com, Inc. AMZN $406,268 $396,947 99.7% 60.8% 160.9% 20.2% 27.9% 8.7% 3.2x 3.0x 36.5x NM

Alibaba Group BABA 275,348 263,975 96.3% 79.7% NA 29.3% 43.0% 36.9% 15.7x 13.2x 42.6x 23.5x

eBay Inc. EBAY 38,459 37,145 99.1% 32.1% 39.7% (2.3%) 4.1% 32.8% 4.3x 4.3x 13.1x 20.0x

JD.com, Inc. JD 34,062 29,889 77.9% (1.5%) NA 54.7% 31.1% NM 1.0x 0.9x NM NM

Rakuten, Inc. 4755-JP 20,306 18,539 89.4% (0.6%) (13.8%) 19.2% 33.9% 20.0% 3.2x 2.6x 15.8x 50.5x

Liberty Interactiv e QVCA 20,385 15,205 69.7% (24.2%) (0.8%) (4.9%) 4.0% 17.6% 1.9x 2.0x 10.9x 17.5x

MercadoLibre, Inc. MELI 8,002 8,168 96.5% 104.0% 33.7% 17.1% 25.3% 24.8% 10.4x 9.8x 41.9x 65.9x

58.com Inc. WUBA 6,763 5,541 67.8% 4.8% NA 175.8% (73.5%) NM 1.1x 5.7x NM NM

Shopify, Inc. SHOP 3,244 3,170 95.0% 22.4% NA 94.9% 79.6% NM 9.6x 8.8x NM NM

LendingClub Corp LC 5,934 2,417 41.2% (53.0%) NA 72.3% (51.8%) NM 8.9x 12.6x NM NM

Cnov a NV CNV 2,520 2,370 99.4% 77.8% NA (57.5%) 88.7% NM 1.6x 0.7x NM NM

Wayfair, Inc. W 3,065 1,897 78.7% 9.8% NA 70.6% 52.1% NM 1.1x 0.9x NM NM

Ov erstock.com, Inc. OSTK 311 388 85.4% (9.9%) (49.7%) 10.7% 6.4% 0.9% 0.2x 0.2x 20.5x 40.7x

Median $8,002 $8,168 89.4% 9.8% 16.5% 20.2% 27.9% 20.0% 3.2x 3.0x 20.5x 32.1x

Page 22: TECHNOLOGY, MEDIA, & TELECOM...Criteo’spending acquisition of HookLogic HookLogic provides closed-loop marketing for brand advertisers through its partnerships with leading retailers

PAGE |

TECHNOLOGY, MEDIA & TELECOM

QUARTERLY INTERNET & DIGITAL MEDIA SECTOR REVIEW │ 3Q 2016

APPENDIX: INTERNET & DIGITAL MEDIA SECTOR PUBLIC COMPANY METRICS

TRAVEL

21

FLASH SALES / PROMOTIONAL / COUPONS

VERTICAL eCOMMERCE

Marketing

Technology

Advertising

Networks /

Search Portals

Local Online

Advertising

Internet

Bellwethers

Marketplace

Proprietary Data

Networks

Community

Based Info

Services

Travel

Flash Sales /

Promotional /

Coupons

Vertical

eCommerce

Digital Media &

Online Content

Social Media

Gaming

Enterprise Market % of 52 1-Year Stock 3-Year Stock Revenue Growth LTM EBITDA Enterprise Value / Price /

Company Ticker Value Capitalization Week High Performance Performance LTM NTM Margin LTM Rev. 2016E Rev. LTM EBITDA Earnings

As of September 30, 2016.Enterprise value and market capitalization figures in millions USD.Market capitalization figures exclude non-traded shares

Priceline Group Inc PCLN $76,545 $72,731 99.3% 18.0% 41.7% 9.3% 15.6% 37.9% 7.8x 7.2x 20.6x 28.5x

Ctrip.com CTRP 24,016 23,175 81.2% 48.8% 55.9% 45.6% 66.1% 4.9% 10.6x 8.3x NM 58.1x

Expedia, Inc. EXPE 20,949 16,001 83.1% (2.7%) 120.8% 15.8% 31.1% 13.6% 2.5x 2.4x 18.4x 84.3x

TripAdv isor, Inc. TRIP 8,530 8,394 72.2% (1.5%) (19.5%) 19.7% 2.2% 17.0% 5.8x 5.6x 34.1x 42.4x

MakeMyTrip Ltd. MMYT 1,022 996 99.2% 69.5% 56.9% 12.1% (34.0%) NM 2.7x 9.7x NM NM

Trav elzoo Inc. TZOO 153 178 96.7% 54.4% (52.4%) (0.3%) (5.9%) 9.6% 1.2x 1.1x 12.2x 29.0x

Median $14,740 $12,197 89.9% 33.4% 48.8% 14.0% 8.9% 13.6% 4.2x 6.4x 19.5x 42.4x

Groupon, Inc. GRPN $2,504 $2,947 86.7% 58.5% (56.0%) (2.3%) (0.6%) 1.4% 0.8x 0.8x NM NM

Quotient Technology Incorporated QUOT 966 1,117 92.7% 47.9% NA 7.0% 13.7% NM 3.6x 3.6x NM NM

RetailMeNot, Inc. SALE 321 481 76.5% 20.3% (71.3%) (5.9%) 15.9% 11.9% 1.2x 1.1x 10.2x 55.7x

Median $966 $1,117 86.7% 47.9% (63.6%) (2.3%) 13.7% 6.6% 1.2x 1.1x 10.2x 55.7x

GrubHub, Inc. GRUB $3,419 $3,663 96.4% 75.5% NA 42.5% 34.5% 23.9% 7.5x 7.0x 31.4x NM

Cimpress N.V. CMPR 4,029 3,200 97.1% 31.8% 77.3% 19.7% 16.1% 11.1% 2.2x 2.1x 19.5x NM

Shutterstock, Inc. SSTK 1,992 2,231 97.8% 113.5% (13.9%) 29.6% 18.7% 14.1% 4.1x 3.9x 29.3x NM

Stamps.com Inc. STMP 1,777 1,632 76.4% 27.3% 105.2% 45.3% 58.2% 30.3% 5.4x 5.3x 17.9x 35.4x

Etsy, Inc. ETSY 1,421 1,624 91.0% 0.9% NA 39.8% 31.7% 12.6% 4.1x 3.9x 32.9x NM

Shutterfly, Inc. SFLY 1,823 1,517 81.8% 25.0% (21.7%) 15.0% 8.9% 13.4% 1.6x 1.6x 12.2x 27.1x

Chegg, Inc. CHGG 591 645 88.3% (0.6%) NA (1.1%) (16.9%) NM 2.2x 2.4x NM NM

PetMed Express, Inc. PETS 361 416 95.8% 26.4% 19.7% 2.3% 2.2% 14.7% 1.5x 1.5x 10.3x 19.1x

Blue Nile, Inc. NILE 365 400 88.3% 7.8% (14.0%) 1.4% (1.4%) 4.0% 0.8x 0.8x 19.4x 41.9x

1-800-FLOWERS.COM, Inc. FLWS 826 321 84.3% (0.4%) 83.8% 4.6% 4.5% 6.5% 0.7x 0.7x 10.8x 12.6x

eHealth, Inc. EHTH 138 205 74.0% (12.4%) (66.0%) 5.5% 3.6% NM 0.7x 0.7x NM NM

Median $1,421 $1,517 88.3% 25.0% 2.9% 15.0% 8.9% 13.4% 2.2x 2.1x 19.4x 27.1x

Page 23: TECHNOLOGY, MEDIA, & TELECOM...Criteo’spending acquisition of HookLogic HookLogic provides closed-loop marketing for brand advertisers through its partnerships with leading retailers

PAGE |

TECHNOLOGY, MEDIA & TELECOM

QUARTERLY INTERNET & DIGITAL MEDIA SECTOR REVIEW │ 3Q 2016

APPENDIX: INTERNET & DIGITAL MEDIA SECTOR PUBLIC COMPANY METRICS

DIGITAL MEDIA & ONLINE CONTENT

22

SOCIAL MEDIA

GAMING

Marketing

Technology

Advertising

Networks /

Search Portals

Local Online

Advertising

Internet

Bellwethers

Marketplace

Proprietary Data

Networks

Community

Based Info

Services

Travel

Flash Sales /

Promotional /

Coupons

Vertical

eCommerce

Digital Media &

Online Content

Social Media

Gaming

Enterprise Market % of 52 1-Year Stock 3-Year Stock Revenue Growth LTM EBITDA Enterprise Value / Price /

Company Ticker Value Capitalization Week High Performance Performance LTM NTM Margin LTM Rev. 2016E Rev. LTM EBITDA Earnings

As of September 30, 2016.Enterprise value and market capitalization figures in millions USD.Market capitalization figures exclude non-traded shares

Tencent Holdings Ltd. 700-HK $239,398 $259,975 96.5% 64.6% 161.7% 27.7% 36.8% 42.0% 12.4x 10.7x 29.5x 56.7x

SINA Corp. SINA 4,545 5,233 86.6% 93.1% (8.3%) 14.6% 13.1% 9.4% 4.9x 4.6x NM NM

IAC IAC 5,359 4,609 85.4% (4.2%) 13.9% 3.9% (3.8%) 11.8% 1.7x 1.7x 14.3x NM

Pandora Media, Inc. P 3,406 3,311 64.5% (30.8%) (43.9%) 26.4% 20.0% NM 2.6x 2.4x NM NM

WebMD Health Corp. WBMD 2,781 1,938 73.6% 22.6% 62.7% 9.6% 10.9% 27.5% 4.0x 3.9x 14.7x 23.5x

Sohu.com, Inc. SOHU 905 1,713 74.4% 5.5% (44.2%) 15.8% (13.0%) 9.4% 0.5x 0.5x 5.7x NM

XO Group Inc. XOXO 396 511 98.8% 38.0% 44.4% (1.4%) 7.6% 15.7% 2.7x 2.6x 16.9x NM

Blucora, Inc. BCOR 856 465 73.9% (16.2%) (52.6%) 13.5% NA 39.6% 7.9x 1.9x 20.0x NM

Ev eryday Health, Inc. EVDY 342 257 72.6% (10.8%) NA 25.9% 10.8% 10.4% 1.4x 1.3x 13.3x NM

TechTarget, Inc. TTGT 272 219 84.0% (7.2%) 61.8% 5.3% (1.2%) 15.6% 2.4x 2.5x 15.5x 30.5x

Demand Media, Inc. DMD 57 116 87.9% 37.1% (54.9%) (26.9%) (12.7%) NM 0.5x 0.5x NM NM

Townsquare Media, Inc. TSQ 812 98 77.5% (3.9%) NA 18.0% 19.7% 18.7% 1.7x 1.5x 9.2x 10.0x

Median $880 $1,112 80.7% 0.8% 2.8% 14.1% 10.8% 15.6% 2.5x 2.2x 14.7x 27.0x

Facebook, Inc. FB $347,767 $297,966 97.2% 41.0% 154.4% 43.8% 51.0% 52.0% 14.1x 12.8x 27.1x NM

Twitter, Inc. TWTR 14,226 16,313 72.3% (6.6%) NA 58.1% 15.1% 3.1% 5.6x 5.6x NM NM

Weibo Corp WB 10,721 4,999 95.9% 336.4% NA 43.5% 32.7% 16.8% 20.0x 16.9x NM NM

Momo Inc MOMO 4,007 3,245 87.8% 80.1% NA 200.4% 209.0% 12.0% 17.8x 9.7x NM NM

Match Group, Inc. MTCH 5,794 744 97.7% NA NA 14.9% 20.3% 29.4% 5.0x 4.7x 16.8x 5.6x

Spark Networks, Inc. LOV 37 41 38.2% (47.3%) (80.8%) (21.9%) (22.6%) NM 0.9x 1.0x NM NM

Median $8,257 $4,122 91.9% 41.0% 36.8% 43.6% 26.5% 16.8% 9.9x 7.6x 22.0x 5.6x

Nintendo Co., Ltd. 7974-JP $22,965 $37,220 85.5% 51.8% 130.7% (8.2%) 18.1% 5.4% 6.0x 4.6x NM 91.3x

Activ ision Blizzard, Inc. ATVI 35,824 32,847 98.2% 43.4% 162.1% 5.8% 40.7% 36.7% 6.0x 5.5x 16.4x 37.7x

NetEase, Inc. NTES 27,649 31,928 94.6% 105.1% 232.1% 91.0% 55.2% 33.9% 5.7x 4.9x 16.7x 29.8x

Electronic Arts Inc. EA 23,429 25,685 99.5% 27.1% 223.2% (3.2%) 13.2% 26.6% 5.2x 4.8x 19.6x 20.5x

Ubisoft Entertainment SA UBI-FR 4,441 4,287 88.3% 83.0% 135.4% (4.8%) 24.8% 43.9% 2.7x 2.4x 6.2x 38.2x

Take-Two Interactiv e Software, Inc. TTWO 4,082 3,878 96.4% 58.0% 145.3% 30.5% 16.0% 16.5% 2.7x 2.5x 16.2x NM

Zynga Inc. ZNGA 1,695 2,226 96.4% 28.2% (24.2%) 10.8% (2.2%) NM 2.3x 2.3x NM NM

GREE, Inc. 3632-JP 507 1,347 89.4% 23.2% (28.0%) (24.4%) (3.6%) 20.3% 0.9x 0.8x 4.2x 8.5x

Glu Mobile Inc. GLUU 151 298 50.1% (46.0%) (22.8%) 12.0% (20.7%) NM 0.7x 0.8x NM NM

Median $4,441 $4,287 94.6% 43.4% 135.4% 5.8% 16.0% 26.6% 2.7x 2.5x 16.3x 33.8x

Page 24: TECHNOLOGY, MEDIA, & TELECOM...Criteo’spending acquisition of HookLogic HookLogic provides closed-loop marketing for brand advertisers through its partnerships with leading retailers

Healthcare & Life Sciences

IndustrialsEnergy, Power & Infrastructure

Industrials

PAGE |

Harris Williams & Co. has a broad range of industry expertise, which create powerful opportunities. Our clients benefit form our deep-sector experience,integrated industry intelligence and collaboration across the firm, and our commitment to learning what makes them unique. For more information,visit our website at www.harriswilliams.com/industries.

HARRIS WILLIAMS & CO. OFFICE LOCATIONS

UNITED STATES EUROPE

BostonTwo International Place24th FloorBoston, Massachusetts 02110Phone: +1 (617) 482-7501

Cleveland1900 East 9th Street20th FloorCleveland, Ohio 44114Phone: +1 (216) 689-2400

Minneapolis222 South 9th StreetSuite 3350Minneapolis, Minnesota 55402Phone: +1 (612) 359-2700

Richmond (Headquarters)1001 Haxall Point9th FloorRichmond, Virginia 23219Phone: +1 (804) 648-0072

San Francisco575 Market Street31st FloorSan Francisco, California 94105Phone: +1 (415) 288-4260

FrankfurtBockenheimer Landstrasse 33-3560325 FrankfurtGermanyPhone: +49 069 3650638 00

London63 Brook StreetLondon W1K 4HS, EnglandPhone: +44 (0) 20 7518 8900

NETWORK OFFICES

Beijing

Hong Kong

Mumbai

New Delhi

Shanghai

Aerospace, Defense & Government

Services

Building Products & Materials

Business Services

Consumer Specialty Distribution

Technology, Media & Telecom

Transportation & Logistics

TECHNOLOGY, MEDIA & TELECOM

QUARTERLY INTERNET & DIGITAL MEDIA SECTOR REVIEW │ 3Q 2016

Technology, Media & Telecom

OUR FIRM

23

Washington, D.C. 800 17th St. NW2nd Floor Washington, D.C. 20006 Phone: +1 202-207-2300

Page 25: TECHNOLOGY, MEDIA, & TELECOM...Criteo’spending acquisition of HookLogic HookLogic provides closed-loop marketing for brand advertisers through its partnerships with leading retailers

PAGE |

TECHNOLOGY, MEDIA & TELECOM

QUARTERLY INTERNET & DIGITAL MEDIA SECTOR REVIEW │ 3Q 2016

Harris Williams & Co. (www.harriswilliams.com) is a preeminent middle market investment bank focused on the advisory needs of clients worldwide. The firm has deep industryknowledge, global transaction expertise, and an unwavering commitment to excellence. Harris Williams & Co. provides sell-side and acquisition advisory, restructuring advisory,board advisory, private placements, and capital markets advisory services.

Investment banking services are provided by Harris Williams LLC, a registered broker-dealer and member of FINRA and SIPC, and Harris Williams & Co. Ltd, which is authorisedand regulated by the Financial Conduct Authority. Harris Williams & Co. is a trade name under which Harris Williams LLC and Harris Williams & Co. Ltd conduct business.

THIS REPORT MAY CONTAIN REFERENCES TO REGISTERED TRADEMARKS, SERVICE MARKS AND COPYRIGHTS OWNED BY THIRD-PARTY INFORMATION PROVIDERS. NONE OF THE THIRD-PARTY INFORMATION PROVIDERS IS ENDORSING THE OFFERING OF, AND SHALL NOT IN ANY WAY BE DEEMED AN ISSUER OR UNDERWRITER OF, THE SECURITIES, FINANCIALINSTRUMENTS OR OTHER INVESTMENTS DISCUSSED IN THIS REPORT, AND SHALL NOT HAVE ANY LIABILITY OR RESPONSIBILITY FOR ANY STATEMENTS MADE IN THE REPORT OR FOR ANYFINANCIAL STATEMENTS, FINANCIAL PROJECTIONS OR OTHER FINANCIAL INFORMATION CONTAINED OR ATTACHED AS AN EXHIBIT TO THE REPORT. FOR MORE INFORMATION ABOUTTHE MATERIALS PROVIDED BY SUCH THIRD PARTIES, PLEASE CONTACT US AT THE ABOVE ADDRESSES OR NUMBERS.

The information and views contained in this report were prepared by Harris Williams & Co. (“Harris Williams”). It is not a research report, as such term is defined by applicable lawand regulations, and is provided for informational purposes only. It is not to be construed as an offer to buy or sell or a solicitation of an offer to buy or sell any financialinstruments or to participate in any particular trading strategy. The information contained herein is believed by Harris Williams to be reliable, but Harris Williams makes norepresentation as to the accuracy or completeness of such information. Harris Williams and/or its affiliates may be market makers or specialists in, act as advisers or lenders to,have positions in and effect transactions in securities of companies mentioned herein and also may provide, may have provided, or may seek to provide investment bankingservices for those companies. In addition, Harris Williams and/or its affiliates or their respective officers, directors and employees may hold long or short positions in the securities,options thereon or other related financial products of companies discussed herein. Opinions, estimates and projections in this report constitute Harris Williams’ judgment and aresubject to change without notice. The financial instruments discussed in this report may not be suitable for all investors, and investors must make their own investment decisionsusing their own independent advisors as they believe necessary and based upon their specific financial situations and investment objectives. Also, past performance is notnecessarily indicative of future results. No part of this material may be copied or duplicated in any form or by any means, or redistributed, without Harris Williams’ prior writtenconsent.

Copyright© 2016 Harris Williams & Co., all rights reserved.

HARRIS WILLIAMS & CO.

FactSet.

PNC Capital Markets.

S&P LCD stats.

PitchBook.

HW&Co. proprietary transaction information.

SOURCES

DISCLOSURES

24