VENTURE CAPITAL IN MOBILE

1H12 Update

Rajeev Chand
Managing Director
Head of Research

August 15, 2012

VC in Mobile—$3.9 Billion in 1H12

VC Investments in Mobile
Global, 2001-1H12
Amount ($B)
7.0
$6.4
$6.3
Carrier
6.0
Technology $5.4
$5.1
$4.9
5.0
$4.5

$4.0 $3.9
4.0 $3.6

$3.1 $3.0
3.0
$2.6
$2.1
2.0

1.0

0.0
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 1H11 1H12
Source: Rutberg & Company
Note: Excludes debt financings for venture-backed companies

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VC in Mobile—46% of Overall VC

Mobile VC as Percentage of Overall Tech VC(1)

2001-1H12
Percent of Overall VC
50%
46.3%

45%
39.1%
40%

35%
29.2%
28.9%
30% 27.1% 27.5%
25.6%
25%

17.8% 17.8% 17.4% 16.9%

20%

12.9%
15%

10%

5%

0%
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 1H12
Source: Rutberg & Company
(1) Overall tech VC based NVCA data (includes computer and peripheral, IT service, networking and equipment, semiconductor, and software sectors; excludes carrier sector)

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VC in Mobile—4th Largest Tech R&D “Organization”

Mobile VC Investments vs. Tech Companies’ R&D Expenditures(1)

1H12
Amount ($B)

5.0

4.0

3.0

2.0

1.0

0.0
Microsoft

Samsung

Google

ALU

EMC
HP

SAP
Nokia

IBM

Cisco

Oracle

Ericsson

Canon

Qualcomm

Apple

STMicro

FUJIFILM
Mobile VC
Intel

Source: Rutberg & Company

(1) Public companies’ R&D expenditures as reported for last six month period.

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VC in Mobile—$1B in Consumer Apps

Mobile VC Investments by Sector

Global, 1H12

Semiconductor
$0.3B
Carrier
$0.4B

CE Device $573MM Infrastructure

$1.3B
Component $116MM

Device Enterprise $653MM

$0.7B Media $426MM
Telecom $235MM

Application
Consumer $1,009MM
$1.2B
Enterprise $176MM
Telecom $4MM

1H2012 = $3.9 billion

Source: Rutberg & Company

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VC in Mobile—By Sector over Time

Percent of Mobile VC Dollars by Sector over Time

Global, 2005-1H12

% Total Consumer Application % Total Telecom Application % Total Enterprise Application

30% 10% 8%
8% 6%
20%
6%
4%
4%
10%
2% 2%

0% 0% 0%
2005 2006 2007 2008 2009 2010 2011 1H12 2005 2006 2007 2008 2009 2010 2011 1H12 2005 2006 2007 2008 2009 2010 2011 1H12

% Total Media Infrastructure % Total Telecom Infrastructure % Total Enterprise Infrastructure

20% 30% 20%

15% 15%
20%
10% 10%
10%
5% 5%

0% 0% 0%
2005 2006 2007 2008 2009 2010 2011 1H12 2005 2006 2007 2008 2009 2010 2011 1H12 2005 2006 2007 2008 2009 2010 2011 1H12

% Total Device % Total Carrier % Total Semiconductor

20% 40% 20%

15% 30% 15%

10% 20% 10%

5% 10% 5%

0% 0% 0%
2005 2006 2007 2008 2009 2010 2011 1H12 2005 2006 2007 2008 2009 2010 2011 1H12 2005 2006 2007 2008 2009 2010 2011 1H12

Source: Rutberg & Company

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VC in Mobile—1H12 Cluster Map
Consumer Apps
$1B

Commerce and
Payments
$526MM

Advertising
$246MM

Enterprise
Video $609MM
$202MM

Device
$636MM
mHealth
$129MM

Source: Rutberg & Company

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VC in Mobile—2012YTD Private Company Metrics (Selected)

1.3 billion 40m users, 93.5 billion monthly

$6 billion in run 1 billion downloads,
messages per day, 70,000 stations impressions,
rate payments, 200m MAUs
+30% in 5 months +251% YoY
2m merchants

13m users reading

20m users, 100m rewards/month, 34m users, 18m registered users, 200m stories
+100% in 6 months 1.4m premium +80% in 6 months per month
50% re-engagement

70m users, 45m users in 15m active users, 600% YoY growth 400m downloads,
1m per week 18 months 4m pay subscribers in enterprise 115m MAUs
customers

Source: Rutberg & Company, company press releases and publicly disclosed statements

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VC in Mobile—61% of Deals are $5MM or Less

VC in Mobile by Round Size(1) Selected Early Stage Investments

2005-1H12 1H12
% of Deals
100%

90%

80%

70%

60%

50%

40%
(Acquired by
Facebook)
30%
>$20MM
20% $10-$20MM
$5-$10MM (Acquired by
10% <=$5MM Autodesk)

0%
2005 2006 2007 2008 2009 2010 2011 1H12
Source: Rutberg & Company
(1) Excludes deals where amount was not disclosed

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VC in Mobile—Largest Investments

Top 25 VC Investments in Mobile

1H12
Most Recent Amount
Rank Company Location Sector Subsector Date ($MM)

1 Xiaomi Tech Beijing, China Device Handset 6/28/2012 216.0

2 Sistema Shyam Gurgaon, India Carrier Network operator 1/12/2012 158.0
3 Sonos Santa Barbara, CA Device Wireless home music system 6/19/2012 135.0
4 Lianlian Pay Hangzhou, China Carrier Mobile payment 1/18/2012 125.0
5 Linkem Rome, Italy Carrier Wireless broadband 5/21/2012 90.3
6 Quantenna Fremont, CA Semiconductor 802.11n semiconductor 4/17/2012 79.0
7 Evernote Mountain View, CA Application Notes application 5/3/2012 70.0
7 Skybox Imaging Mountain View, CA Infrastructure Satellite imagery 4/18/2012 70.0
9 LifeStreet Media San Carlos, CA Infrastructure Mobile advertising 5/3/2012 66.0
10 AnchorFree Mountain View, CA Application WiFi security 5/22/2012 52.0
11 SecureKey(1) Toronto, Canada Infrastructure Mobile payments security 5/18/2012 50.2
12 Foursquare New York, NY Application LBS application 3/1/2012 50.0
12 Instagram San Francisco, CA Application Photo sharing 4/9/2012 50.0
12 SoundCloud Berlin, Germany Application Music application 1/2/2012 50.0
15 SmartDrive Systems San Diego, CA Infrastructure Fleet management 6/19/2012 47.0
16 Row 44 Westlake Village, CA Carrier In-flight service 6/12/2012 45.0
17 Ddmap.com Shanghai, China Application Mobile map 6/22/2012 40.0
17 MobileIron Sunnyvale, CA Infrastructure Mobile device management 5/30/2012 40.0
17 Path San Francisco, CA Application Social network 4/13/2012 40.0
17 Tango Palo Alto, CA Application Video calling 4/19/2012 40.0
21 Komli Media Mumbai, India Infrastructure Mobile advertising 6/12/2012 39.0
22 Viddy(1) Venice, CA Application Social video app 5/14/2012 36.4
23 Boku San Francisco, CA Application Mobile payments 3/15/2012 35.0
23 SpiderCloud San Jose, CA Infrastructure Indoor wireless connectivity 4/6/2012 35.0
25 Magnum(1) Milpitas, CA Semiconductor Wireless video broadcast 6/19/2012 32.8

Source: Rutberg & Company

(1) Represents companies with multiple announcements in 1H12; date is listed as of the most recent announcement, and amounts are aggregated for the half-year

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Thank You

Rutberg & Company Research

Contact Information

Rajeev Chand
Managing Director
Head of Research
rchand@rutbergco.com

Nick Mayberry
Senior Equity Research Associate
nmayberry@rutbergco.com

Kyle Spraker
Equity Data Associate
kspraker@rutbergco.com
Rutberg & Company—Annual Events

SAN FRANCISCO RANCHO PALOS VERDES LONDON

Future:Mobile Wireless Influencers Rutberg Summit: London

June 18-19, 2012 October 21-23, 2012 April 16-18, 2013

Westin Market Street Terranea Resort Claridge’s Hotel
San Francisco, California Rancho Palos Verdes, California London, England
Rutberg & Company—Investment Banking

Barry A. Newman Robert C. Harris Joseph S. Sanborn

Senior Advisor Vice Chairman, Managing Director,
Office: (415) 371-1186 Investment Banking Head of M&A
bnewman@rutbergco.com Office: (415) 371-1186 Office: (617) 262-6694
rharris@rutbergco.com jsanborn@rutbergco.com

Bryan B. Rutberg
Chief Executive Officer
Office: (415) 371-1186
brutberg@rutbergco.com

SAN FRANCISCO BOSTON

351 California Street, Suite 1110 800 Boylston Street, 16th Floor
San Francisco, CA 94104 Boston, MA 02199
Telephone: (415) 371-1186 Telephone: (617) 262-6694