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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 Sillermans 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 Persession

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

Im not optimistic about the outlook for thiscompany

Source: Glassdoor

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What Do Employees Say? (contd)

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? (contd)

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 arent met.

Source: Glassdoor

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Valuation

Viggle currently trades at $5.73

Market cap is $79 million

This puts Viggles 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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The End