Company Presentation - Macquarie Group · The Company and its affiliates, advisers, representatives...
Transcript of Company Presentation - Macquarie Group · The Company and its affiliates, advisers, representatives...
Company Presentation
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relied upon in connection with any contract or commitment whatsoever. Specifically, this document does not constitute a “prospectus” within the meaning of the U.S. Securities Act of 1933, as amended.
500.com Limited (the “Company”) has filed a registration statement (including a prospectus) (File No. 333-191844) with the U.S. Securities and Exchange Commission (the “SEC”) for the securities to be
offered in the United States, but the registration statement has not yet become effective. This presentation does not contain all relevant information relating to the Company or its securities, particularly with
respect to the risks and special considerations involved with an investment in the securities of the Company, and is qualified in its entirety by reference to the detailed information appearing in the
prospectus included in the registration statement filed by the Company with the SEC. Any offering of securities to be made in the United States and any decision to purchase securities of the Company in
the United States or anywhere else should be made solely on the basis of the information contained in the prospectus included in the registration statement filed by the Company with the SEC. Before
making an investment decision, you should read the prospectus in that registration statement and other documents that the Company has filed with the SEC for more complete information about the
Company and its securities. You may access these documents for free by visiting EDGAR on the SEC website at: http://www.sec.gov. The issuer has filed a registration statement (including a prospectus)
with the SEC for the offering to which this communication relates. Before you invest, you should read the prospectus in that registration statement and other documents the issuer has filed with the SEC for
more complete information about the issuer and this offering. You may get these documents for free by visiting EDGAR on the SEC Web site at www.sec.gov. Alternatively, the issuer, any underwriter or
any dealer participating in the offering will arrange to send you the prospectus if you request it by calling toll-free 1-800-503-4611.
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Future results are impossible to predict. Certain statements in this presentation, and other statements that the Company may make, may contain forward-looking statements with respect to the Company’s
future financial or business performance, or opinions, expectations, beliefs, intentions, estimates or strategies regarding the future, which may not be realized. These statements may be identified by the
use of words like “anticipate,” “believe,” “estimate,” “expect,” “intend,” “may,” “plan,” “will,” “should,” “seek,” and similar expressions. The Company cautions that forward-looking statements reflect views and
assumptions as of the date of this document and are subject to numerous risks and uncertainties, many of which are beyond the Company’s control and subject to change over time. Actual results could
differ materially from those anticipated in forward-looking statements and future results could differ materially from historical performance. Given these risks, uncertainties, assumptions and other factors,
you are cautioned not to place undue reliance on these forward-looking statements. The Company and its affiliates, advisers, representatives and underwriters have no obligation to and do not undertake
to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
The following presentation has been prepared by the Company and has not been independently verified. No representation, warranty or undertaking, expressed or implied, is made as to, and no reliance
should be placed on, the accuracy, fairness, completeness, correctness or reasonableness of the information, sources or opinions presented or contained in this document. Neither the Company nor any of
its affiliates, advisers, representatives or underwriters, or any of their respective directors, officers, employees or agents, accepts any responsibility or liability whatsoever (in negligence or otherwise) for
any damage or loss howsoever arising from any information presented or contained in this document, any omission, inadequacy or inaccuracy in this document, or otherwise arising in connection with this
presentation. The information presented or contained in this document is subject to change without notice and its accuracy is not guaranteed.
This presentation speaks as of the date hereof. Neither the delivery of this presentation nor any further discussions of the Company or any of its affiliates, shareholders, directors, employees, agents or
advisors with any of the recipients of this document shall, under any circumstances, create any implication that the affairs of the Company have not changed since that date.
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Company Overview
Growth Strategies
Appendix
Investment Highlights
Financials
Who are we?
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is China's #1 online sports lottery service platform*
is the only government approved private online lottery service provider
provides the most comprehensive, sophisticated and trusted services
has 12+ years of operational history since 2001
1
* In terms of purchase amount in the first half of 2013
Our business model
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Highly Efficient Business Model
Prize
Collection
Service fee
Purchase 100% purchase price
100% of prize
Service fee
100% purchase price
100% of prize
Operation 100% online No logistics / No inventory No principal risk No counterparty risk
Lottery games offered on our platform
Source: Company
Sports Match Games Lotto Games High Frequency
Games
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Bet on the outcome or scores of one
or a combination of sports matches
Choose N numbers out
of M numbers, results
announced every 10 or
15 minutes
Select N numbers out
of M numbers, results
announced daily or
every 3 days
Not applicable
… Not applicable
Lottery games
Underlying sports matches
How to play
Investment Highlights
Appendix
Company Overview
Financials
Growth Strategies
Investment Highlights
Huge market potentials 1
Leading online sports lottery platform in China 2
Comprehensive and innovative service enhancing user experience 3
Experienced and dedicated management team 6
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Innovative and reliable technology 5
Large and active user base 4
China’s Total Lottery Market China's Sports Lottery Market China's Online Sports Lottery Market
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27.2
50.3
73.6
2010 2013E 2015E
11.4
21.5
31.3
2010 2013E 2015E
0.4
1.5
3.2
2010 2013E 2015E
(USD in billions) (USD in billions) (USD in billions)
Huge market potentials 1
Source: iResearch
3.3 % 6.9 % 10.1% Penetration %
Leading online sports lottery platform in China Market leader with government approval
9
2
* Online sports lottery only, in terms of purchase amount in the first half of 2013
Source: iResearch
1H 2013
The only MOF- approved privately owned online lottery sales service provider with an operational track record
Largest Market Share in China* MOF- Approved Online Lottery
Service Provider
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Leading online sports lottery platform in China Leading brand name closely associated with sports events
2
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Global sports
match information Comprehensive
lottery information
68 Lottery
Products
958 Odds
Sources
---------------------------------------------------------------------------------------------------------------------------
55 provincial
lottery products
13 national
lottery products Matches from 60 countries
40,000+ soccer and basketball
matches
Comprehensive and innovative service enhancing user experience Comprehensive lottery information services
3
12
Track record:
Accumulative winning:RMB 89+ million
Jackpot winnings:3 X RMB 5m+ , 34 X RMB 1m+, 117 X RMB 100k+
Number of fans:167,490
Auto tag-along purchasers:1,697
The star player and the followers fund
the purchase plan together
The star player gets a pre-set % from the prize for
his work and the rest is shared among all
purchasers
10%+ Star
Followers
Purchase plan
Pool purchase vs.
total purchase
17%
3 Comprehensive and innovative service enhancing user experience Innovative purchase modes – pool purchase case study
A “purchase plan” initiated by a star player
Pool purchase
Share the prize
Enhances user
stickiness
Creates a sense
of community
“ Insights on Lotto”
In-depth “analyst reports”
To better choose
underlying matches
To facilitate
purchases
To project prize
amount
Intelligent betting
Probability analysis of sports match outcome based on
proprietary database
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Comprehensive and innovative service enhancing user experience Innovative purchase tools
3
Help customers:
Prize calculator Instant calculation of prize
amount based on sports match outcome
Adopted by Taobao lottery Adopted by Taobao lottery
“Lock –in numbers” purchase
Automatic purchase for a number of times with “lock –in numbers”
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In the first 9 months of 2013, mobile purchases represent14% of our total amount
Comprehensive and innovative service enhancing user experience Superior mobile Internet services across technology platforms
3
Wap Version iOS & Android HTML5 iOS & Android
Lottery purchase application Sports match
info application
High User Activity Level Purchase Amount Breakdown
Active
Accounts(1)
15
(USD Millions)
4 Large and active user base
2013
purchase orders per
active user
$411.8 52
Jan Feb Mar Apr May Jun Jul Aug Sep
spending per active
user
158
243 212 222
136
168
61
101
294
411
273
323
2010 2011 2012 9M 2013
Existing customers New customers
Reliable + Fast
is a true
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Peers are pure companies
company
Full control of process =
5 Innovative and reliable technology
Internet
Internet
lottery
Entrepreneurship and Strategic Vision
LAW Man San
Founder, Chairman & CEO
Founded Shenzhen E-Sun Network Co., Ltd. in 2001
Pioneer in online lottery service industry in China for 10+ years
Executive MBA degree from Cheung Kong Graduate School of Business, Bachelor’s degree from
Wuhan University
Expertise in Internet / IT Industry/Gaming Industry
ZHENG Lei
COO
Joined in 2009
10 years of experience in the IT industry
Bachelor’s degree from Wuhan University
TIAN Zhaofu
CTO
Joined in 2012
Over 10 years of experience in information technology industry
MBA degree from Hong Kong University of Science and Technology
ZOU Ying
VP , Mobile
Joined in 2001
Over 10 years of experience in Internet service industry
Has been in charge of marketing since 2006;
Bachelor’s degree from Wuhan Technical University of Surveying and Mapping
YU, Wensheng
Director of International
Business
Joined in 2013
Over 10 years of experience in sports and gaming industry
Bachelor’s degree from University of Westminster in UK
Know How in Finance & Capital Markets
PAN Zhengming
CFO
Joined in 2011
Over 8 years of experience in finance and legal industries
JD degree from University of Columbia Law School
LIU Punleung
CRO
Joined in 2011
Member of Hong Kong Institute of Certified Public Accountants and Institute of Internal Auditors
Bachelor’s degree in accountancy from City University of Hong Kong
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Experienced and dedicated management team 6
Growth Strategies
Investment Highlights
Financials
Appendix
Company Overview
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Technology Enhance infrastructure and security system
to ensure reliability and better user
satisfaction
Lottery purchase services
Further enhance specialized and
sophisticated services
Mobile services
Focus on mobile services development
Strategic partnerships
Pursue strategic partnerships and
acquisitions
Strengthen
brand name
Growth strategies
Appendix
Financials
Growth Strategies
Company Overview
Investment Highlights
China Lottery Market Overview Regulatory framework and value chain
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Source: iResearch
100
Ministry of Finance
(Regulator)
50 – 69
Prize pool for lottery
buyers
18 – 35
Fund for public
interests
Administration Cost Sales Commission Promotion Cost
Ministry of Civil Affairs
(Issuer) General Administration of Sports
(Issuer)
China Sports Lottery
Administration Center China Welfare Lottery Issuance
and Administration Center
Lotto Instant Sports
Match Instant Lotto
13 – 15
Distribution Cost
Social Welfare Lottery Sports Lottery
Provincial welfare lottery
issuance
and administration centers
Provincial sports lottery
administration centers
Regulatory Framework Lottery Revenue Sharing Scheme