Social Media Deals ReportA Special Report from ContentNext Media from Q1 ‘07 through Q1 ‘08

4 © 2008 ContentNext Media, Inc.ContentNext

Executive SummaryThe economics of social media are continuing to heat up as more and more value and buzz are created in new and growing market categories. In just the past months, Federated Media raised an additional $50 million while AOL acquired Bebo for $850 million. Money continues to flow in and out of the category, which seems to continue to grow in depth and context.

This report examines the categories, number and size of investment into social media and the resulting value created in acquisitions during the 15-month period from January 2007 through March 2008.

Since there are more and more companies squeezing under the social media umbrella, we’ve defined specific subcategories in social media as a framework for better understanding the landscape. For the purpose of this report we have investigated investments and acquisitions taking place in the following high level social media categories:

• Content

• Experiential

• Media Creation and Sharing

• Mobile

• Social Networks

• Services

• Tools and Software

Although the economy may face some challenges in the coming months, social media professionals remain bullish on the category. At our Economics of Social Media Conference (EconSm) in April, ContentNext hosted some 50 panelists and 300 guests from the media, technology, venture and banking communities. Geoff Yang, Partner, Redpoint Ventures, perhaps summed up the current market conditions best during our deals panel when he said, “Even if things slow down, there will still be a big backlog of cash. I would expect that the number of acquisitions that have been done at recent prices will go down. But for the next two to three years, there will still be a vibrant M&A market.”

The pages that follow are filled with data, graphs and examples of the social media deals space by category. Some of the key data points we found on investing, selling and buying social media companies during this period include:

Investments:• Total number of investments: 400

• Total number of disclosed investments: 341 valued at $2,763,715,000

• Average investment size: $8,104,736

• Best estimated value of overall investment in the space (disclosed and undisclosed): $3,074,215,000 total invested

Major Category InvestmentContent

11%Experiential

4%

Media Creation& Sharing

24%

Mobile11%

Services17%

SocialNetworking

23%

Tools & Software10%

Major Category Acqusitions

Services76%

SocialNetworking

17%

Media Creation& Sharing

5%

Tools & Software1% Mobile

1%

Content0%

Social Media Deals ReportA Special Report from ContentNext Media from Q1 ‘07 through Q1 ‘08

5 © 2008 ContentNext Media, Inc.ContentNext

Acquisitions:• Total number of acquisitions: 131

• Total number of disclosed acquisitions: 41 disclosed valued at $13,422,310,000

• Average acquisition size: $327,313,415

Acquisition Range: $350,000 - $6,000,000,000• Best estimated value of overall transaction in the space (disclosed and undisclosed ): $16,324,810,000 acquisition value

• Number of different acquirers: 96

Most Active Investors• Common Angels (12 rounds)

• Accel Partners (9 rounds)

• Edgestone Capital (9 rounds)

• General Catalyst Partners (9 rounds)

• JK&B Capital (9 rounds)

Top 5 Most Active Acquirers• Internet Brands (7 transactions)

• Yahoo! (5 transactions)

• Disney (4 transactions)

• Handheld Entertainment (4 transactions)

• Google (4 transactions)

Top 5 Most Active Social Media Categories• Media Creation and Sharing (101 investments and 19 acquisitions)

• Social Networking (113 investments and 52 acquisitions)

• Services (53 investments and 18 acquisitions)

• Content (58 investments and 26 acquisitions)

• Mobile (3 investments and 2 acquisitions)