Discussion Materials. April 2013

Transcription

1 Discussion Materials April 2013

2 Vimeo Overview Attractive Business Profile Vimeo Business Overview Operates a US-based video hosting website, providing users a platform to upload, share and view videos Its revenue is derived primarily from subscription product offerings as well as advertising Subscription offering appeals to both consumers and businesses, including Vimeo Basic, Vimeo Plus, Vimeo Pro and Vimeo For Business Attracts a distinct audience with its high definition video player, multi-pass video encoding and uncluttered advertising experience >70mm unique visitors per month >90mm total unique viewers ~15% of its traffic comes from mobile devices Currently operates as a subsidiary of IAC/InterActiveCorp through its Media operations IAC/InterActiveCorp s Media operations include: Vimeo, Electus, Connected Ventures, News Beast and DailyBurn Found in 2004 and is based in White Plains, NY IAC/InterActiveCorp Business Overview 15-Aug-2006: Purchased Vimeo during its 51% acquisition of Connected Ventures Operates as a media and internet company comprised of more than 150 brands and products focused in search, applications, online dating, local and media Its business lines operate under: Search & Applications, Match, Local, Media and Other Founded in 1986 and is based in New York, NY IACI/InterActiveCorp Selected Portfolio Source: Capital IQ, public filings, and Company website 2

3 Businesses Businesses Consumers Consumers Vimeo Services Economic Product Offering Services Vimeo Basic Summary Pricing: Free Storage Space: 500 MB per week Advertising : Banner Advertising Supported Comments: Allows for basic video customization and 1 HD upload per week Vimeo Plus Vimeo Pro Vimeo For Business Pricing: $9.95 per month Storage Space: 5 GB per week Advertising : None Comments: Allows for advanced video customization, unlimited HD upload per week, faster video conversion, and additional statistic / privacy tools Pricing: $ per year Storage Space: 50 GB Advertising : None Comments: Allows for consumer monetization with Vimeo Creator Services, Vimeo On Demand, unlimited HD uploading / hosting, advanced video customization / branding, and third party video player support Pricing: $ per year Storage Space: 50 GB Advertising : None Comments: Allows for business video hosting, search engine visibility, no advertisements on videos, Dropbox integration, mobile, tablet & TV compatibility, customizable video player, and third party video player support Source: Company website 3

4 Vimeo Technology Specialized Services Vimeo on Demand Vimeo Music Store + Enhancer Dropbox Allows user to create, publish and distribute proprietary videos at a desired price to the public Provides a 1080p HD quality platform for video content Economics: 90/10 revenue split (after transaction fees) between the user and Vimeo, respectively Vimeo covers delivery costs Allows for the search, download, and licensing of music for user created videos Offers >45,000 free and paid tracks available in store Allows additional edit offerings to subscribers Provides an additional platform to upload and download video content for users Allows users to store personal videos created on Vimeo Plus Stats Vimeo Profile Vimeo Feed / Browser Tracks video traffic over selected time ranges Offers geo-tracking to log where users view content Provides details on who likes/comments Available for Vimeo Plus and Vimeo Pro subscribers Integrates social media concepts to video platform Tracks and shares favorite videos / channels, recent activity, personal groups Provides user profile, including recent activity, friends activities, favorite groups, profile picture Saves privacy settings, content preferences, notifications Browser allows users to queue future videos, search recommended videos and subscriber libraries Feed provides recommended popular videos, related videos / channels and tags Source: Company website 4

5 Software (Built-In Vimeo) Streaming Players and TV s Mobile Vimeo Distribution Available Platforms Compatible Distribution iphone iphone Windows Phone 7 Android Vimeo.com Mobile Site imovie Xbox LIVE / 360 Google TV LG TV WD TV Media Players Samsung TV Samsung Blu-Ray Philips Smart LED TV Boxee AppleTV Roku Panasonic VIERA HDTVs ArcSoft MediaImpression Windows 8 Favs OS X Mountain Lion Final Cut Pro X iphone iphone Courier Couch Mode for Chrome Corel Video Studio Pro Source: Company website 5

6 Crackle Strategic Rationale Synergy Potential Monetize Technology Infrastructure Drive Additional Traffic and Consumer Touch Leverage Incremental Consumer Base Expand Distribution into Additional Platforms / Devices Integration of Vimeo s existing social media concepts (e.g. user profiles, Vimeo feed, peer recommendations) may complement Crackle s strategy Vimeo video tracking technology (e.g. Plus Stats) provides infrastructure for content and advertising recommendations tailored for consumer preference Vimeo s 70 million unique users per month provide an additional user base to connect Crackle content library Vimeo holds a differentiated, dedicated user base that is focused on not just watching videos, but quality of content and viewer experience Vimeo has a small user base already converted into paying subscribers of video content Vimeo s diversity and breadth of compatible platforms (e.g. AppleTV, Boxee, Philips, and Panasonic) provide Crackle access to additional technology, mobile devices, and streaming players / TV s Built in Vimeo service for popular software (e.g. Windows 8, MAC OS X Mountain Lion) provides entry into consumer screens without required Crackle marketing 6

7 Vimeo Valuation Range Valuation Overview Executive Summary Establishing a valuation range for Vimeo is challenging given limited public information as the Company was acquired by IAC in Aug-2006 and consolidated into IAC s Media revenue segment Public data is limited to unique user information Appropriate comparable sectors may include video services, technology services, social media, and other B2C companies Vimeo Valuation Range Based on available public information, we estimate Vimeo s revenue at $5 to $10 million. Comparable companies and transactions value Vimeo at approximately $35 - $70 million Midpoint valuation of approximately $50 million, implying a revenue multiple of x and per user multiple of $0.71 IAC was rumored to have been looking for $300 million for the company in Feb-2012 More focused valuation would require additional information regarding revenues, user mix (i.e. paid / unpaid / tier), impressions and projections 7

8 Comparable Transactions ($ in millions) Target Acquirer Date Valuation EV / Users EV / Monthly Unique Users (mm) MOG Beats 7/2/2012 $14 $ 0.23 N/A 60 N/A MySpace Specific Media 6/28/2011 $35 $ x 35 $183 Median $ x Average $ x Dailymotion (Rumored) $250 (Preliminary) $ x 190 $40 Source: Capital IQ, company filings, and media publications 8

9 Company Comparables ($ in millions) Valuation Size Target EV / CY'12 EV / CY'13 EV / CY'14 Market Cap Enterprise Value CY'12 CY'13 CY'14 Video Services Brightcove 1.6x 1.4x 1.2x $169 $141 $88 $104 $120 Netflix 2.6x 2.2x 1.9x $9,687 $9,371 $3,609 $4,271 $4,905 Median 2.1x 1.8x 1.5x Average 2.1x 1.8x 1.5x Technology Services Broadsoft 3.7x 3.3x 2.8x $688 $612 $165 $185 $217 Cornerstone OnDemand 13.6x 8.8x 6.3x $1,669 $1,598 $118 $181 $253 SalesForce 7.9x 6.2x 5.1x $24,385 $24,165 $3,050 $3,867 $4,783 Median 7.9x 6.2x 5.1x Average 8.4x 6.1x 4.7x Social Media Angie's List 7.1x 4.6x 3.4x $1,146 $1,108 $156 $240 $325 Facebook 11.7x 8.9x 7.1x $66,741 $59,471 $5,089 $6,647 $8,415 LinkedIn 19.4x 12.6x 9.0x $19,649 $18,900 $972 $1,497 $2,093 Yelp.com 11.5x 7.5x 5.4x $1,679 $1,584 $138 $212 $295 Median 11.6x 8.2x 6.2x Average 12.4x 8.4x 6.2x Other B2C Companies Bankrate 2.9x 2.9x 2.6x $1,197 $1,307 $457 $452 $504 Expedia 2.1x 1.8x 1.6x $8,889 $8,309 $4,030 $4,665 $5,241 Groupon 1.3x 1.2x 1.1x $4,234 $3,024 $2,334 $2,563 $2,838 Kayak.com 4.8x 4.0x 3.2x $1,607 $1,417 $293 $355 $441 Moneysupermarket.com 4.7x 4.2x 3.9x $974 $955 $205 $227 $244 Monster Worldwide 0.6x 0.6x 0.6x $499 $515 $890 $829 $841 OpenTable 8.1x 6.9x 6.0x $1,414 $1,311 $162 $189 $219 Travelzoo 1.8x 1.7x 1.6x $339 $277 $151 $160 $170 TripAdvisor 9.6x 7.9x 6.6x $7,415 $7,341 $763 $935 $1,117 XO Group 1.4x 1.4x 1.3x $265 $187 $129 $137 $147 Median 2.5x 2.3x 2.1x Average 3.7x 3.3x 2.8x Total Median 4.7x 4.0x 3.2x Total Average 6.1x 4.6x 3.7x Source: Capital IQ and company filings 9