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    VENTURE CAPITAL IN MOBILE

    2011 Review

    Rajeev ChandManaging DirectorHead of Research

    January 20, 2012

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    1

    VC in Mobile$6.3 Billion in 2011

    Source: Rutberg & CompanyNote: Excludes debt financings for venture-backed companies

    Amount ($B)

    0.0

    1.0

    2.0

    3.0

    4.0

    5.0

    6.0

    7.0

    2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

    CarrierTechnology

    VC Investments in MobileGlobal, 2001-2011

    $6.3

    $4.5

    $2.1

    $3.6

    $5.1

    $6.4

    $5.4

    $4.0

    $2.6

    $3.1

    $4.9

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    VC in Mobile42% of Overall VC

    Percent of Overall VC

    0%

    5%

    10%

    15%

    20%

    25%

    30%

    35%

    40%

    45%

    2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

    Mobile VC as Percentage of Overall Tech VC(1)

    2001-2011

    42.4%

    30.4%

    17.1%18.2%

    28.4%30.4%

    27.6%26.3%

    18.7%18.9%

    13.8%

    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 MobileContext of Public Companies

    Source: Rutberg & Company(1) Public companies R&D expenditures as reported for last twelve month period

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

    2011

    0.0

    1.0

    2.0

    3.0

    4.0

    5.0

    6.0

    7.0

    8.0

    9.0

    10.0

    Microsoft

    Samsung

    Intel

    Nokia

    MobileVC

    IBM

    Cisco

    Hitachi

    Toshiba

    Google

    Ericsson

    Oracle

    Canon

    ALU

    NTT

    HP

    Qualcomm

    SAP

    Apple

    STMicro

    FUJIFILM

    Amount ($B)

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    VC in MobileBy Sector

    Source: Rutberg & Company

    Mobile VC Investments by SectorGlobal, 2011

    Infrastructure$2.6B

    Application$1.8B

    Device

    $1.0B

    Carrier$0.5B

    Semiconductor$0.4B

    2011 = $6.3 billion

    Media $936MM

    Telecom $922MM

    Enterprise $762MM

    Consumer $1,328MM

    Telecom $90MM

    Enterprise $374MM

    CE Device $608MM

    Component $307MM

    Software $62MM

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    VC in MobileBy Sector over Time

    Source: Rutberg & Company

    Percent of Mobile VC Dollars by Sector over TimeGlobal, 2005-2011

    % Total

    0%

    5%

    10%

    15%

    20%

    25%

    2005 2006 2007 2008 2009 2010 2011

    Consumer Application

    % Total

    0%

    5%

    10%

    15%

    20%

    2005 2006 2007 2008 2009 2010 2011

    Media Infrastructure

    % Total

    0%

    5%

    10%

    15%

    20%

    2005 2006 2007 2008 2009 2010 2011

    Device

    % Total

    0%

    2%

    4%

    6%

    8%

    10%

    2005 2006 2007 2008 2009 2010 2011

    Telecom Application

    % Total

    0%

    10%

    20%

    30%

    2005 2006 2007 2008 2009 2010 2011

    Telecom Infrastructure

    % Total

    0%

    10%

    20%

    30%

    40%

    2005 2006 2007 2008 2009 2010 2011

    Carrier

    % Total

    0%

    2%

    4%

    6%

    8%

    2005 2006 2007 2008 2009 2010 2011

    Enterprise Application

    % Total

    0%

    5%

    10%

    15%

    20%

    2005 2006 2007 2008 2009 2010 2011

    % Total

    0%

    5%

    10%

    15%

    20%

    2005 2006 2007 2008 2009 2010 2011

    Semiconductor

    Enterprise Infrastructure

    5

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    VC in Mobile2011 Cluster Map

    Source: Rutberg & Company

    Mobile

    Video

    Mobile

    Advertising

    MobileGames

    Enterprise

    Solutions

    mHealth

    Commerce and

    Payments

    Social

    Apps

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    VC in MobileMarketing & Advertising

    Source: Rutberg & Company

    Amount ($MM)

    0

    100

    200

    300

    400

    500

    600

    700

    2005 2006 2007 2008 2009 2010 2011

    VC Investments in Mobile Marketing & AdvertisingGlobal, 2005-2011

    $592

    $128$138$115

    $161

    $92

    $29

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    VC in MobileHealth

    Source: Rutberg & Company

    Amount ($MM)

    0

    50

    100

    150

    200

    250

    300

    350

    400

    2005 2006 2007 2008 2009 2010 2011

    VC Investments in Mobile HealthGlobal, 2005-2011

    $356

    $209

    $25$9

    $183

    $31$19

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    VC in MobileCommerce & Payments

    Source: Rutberg & Company

    Amount ($MM)

    0

    100

    200

    300

    400

    500

    600

    2005 2006 2007 2008 2009 2010 2011

    VC Investments in Mobile Commerce & PaymentsGlobal, 2005-2011

    $558

    $276

    $85$79

    $134

    $87$88

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    VC in MobileSelected Private Company Announcements in 2011

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

    16MM users,1B recordings

    $11MM in

    paymentsprocessed daily

    10MM monthlyactive users,

    50MM downloads

    83MM monthlyusers, $200MM

    raised fromSoftBank

    $160MM raisedin 2011, valuedat over $1.5B

    3.5MMdownloads,550MM flips per

    month

    2.5MM activeusers, 700MMproduct views

    600% YoYgrowth in

    customers, 435new enterprisecustomers in

    Q42011

    15MM users,200MM photos

    15MM users,half of which are

    outside U.S.

    130MM monthlyactive users, 30MMdaily active users,500MM downloads

    15MM users

    70MM monthlyactive users,

    250MMdownloads,

    20MM monthlydownloads

    15MM users,

    1B messagesper day

    30MM activeusers in justover 1 year

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    VC in MobileBy Round Size

    Source: Rutberg & Company(1) Excludes deals where amount was not disclosed

    % of Deals

    VC in Mobile by Round Size(1)

    2005-2011

    0%

    10%

    20%

    30%

    40%

    50%

    60%

    70%

    80%

    90%

    100%

    2005 2006 2007 2008 2009 2010 2011

    >$20MM$10-$20MM

    $5-$10MM

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    VC in MobileLargest Financings

    Source: Rutberg & Company(1) Represents companies with multiple announcements in 2011; date is listed as of the most recent announcement, and amounts are aggregated for the year

    Top 25 VC Financings in Mobile2011

    Company

    LightSquared

    InMobiPlastic Logic

    Jawbone(1)

    Eaton Towers

    O3b Networks

    Square(1)

    Tabula

    Xiaomi

    DriveCam

    Telecon Group

    Tango(1)

    Evernote

    Flipboard

    Foursquare Labs

    Tower Cloud

    Cellnovo

    Rovio Mobile

    ColorLookout

    Mavenir Systems

    INRIX

    Gogo

    eRecyclingCorps

    Novasom

    Amount($MM)

    265.0

    200.0200.0

    159.0

    150.0

    137.0

    130.5

    108.0

    90.0

    85.0

    60.0

    50.7

    50.0

    50.0

    50.0

    49.0

    48.4

    42.0

    41.040.0

    40.0

    37.0

    35.0

    35.0

    35.0

    Location

    Reston, VA

    San Mateo, CACambridge, UK

    San Francisco, CA

    London, UK

    St. John, UK

    San Francisco, CA

    Santa Clara, CA

    Beijing, China

    San Diego, CA

    Montral, Canada

    Palo Alto, CA

    Mountain View, CA

    Palo Alto, CA

    New York, NY

    St. Petersburg, FL

    London, UK

    Espoo, Finland

    Palo Alto, CASan Francisco, CA

    Richardson, TX

    Kirkland, WA

    Itasca, IL

    Irving, TX

    Glen Burnie, MD

    Date

    7/5/2011

    9/15/20111/18/2011

    12/21/2011

    9/19/2011

    11/17/2011

    11/8/2011

    3/28/2011

    12/20/2011

    11/23/2011

    12/21/2011

    7/20/2011

    7/13/2011

    4/14/2011

    6/27/2011

    10/6/2011

    2/4/2011

    3/10/2011

    3/23/20119/21/2011

    5/31/2011

    7/25/2011

    2/6/2011

    11/11/2011

    7/11/2011

    Subsector

    Wholesale operator

    Mobile advertisingDisplay

    Consumer electronics

    Tower

    Satellite

    Mobile payment platform

    Programmable logic

    Handset

    Fleet management

    Network engineering

    Video calling

    Notes application

    Social content aggregation

    Geosocial network

    Backhaul

    Consumer healthcare device

    Mobile game

    Photo sharingMobile device security

    Convergence application server

    Traffic

    In-flight

    Mobile phone recycler

    Consumer healthcare device

    Sector

    Carrier

    InfrastructureDevice

    Device

    Infrastructure

    Carrier

    Infrastructure

    Semiconductor

    Device

    Infrastructure

    Infrastructure

    Application

    Application

    Application

    Application

    Infrastructure

    Device

    Application

    ApplicationInfrastructure

    Infrastructure

    Infrastructure

    Carrier

    Device

    Device

    Rank

    1

    23

    4

    5

    6

    7

    8

    9

    10

    11

    12

    13

    14

    15

    16

    17

    18

    1920

    21

    22

    23

    24

    25

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    VC in MobileMost Active Investors

    Source: Rutberg & Company(1) Includes family of related venture firms

    Most Active VC Investors in Mobile2011

    Firm

    Sequoia Capital

    Intel Capital

    SV Angel

    Google Ventures

    Kleiner Perkins

    DFJ(1)

    Accel Partners

    NEA

    500 Startups

    Andreessen Horowitz

    Charles River

    QUALCOMM

    True Ventures

    Rank

    1

    2

    3

    4

    4

    6

    7

    8

    9

    9

    11

    12

    12

    Number

    24

    23

    21

    19

    19

    18

    17

    16

    13

    13

    12

    11

    11

    Investments (Announced)

    Bubble Motion, Bump, Clickatell, Color, Cotendo, DailyBooth, Evernote, Flite, Inkling (2), Just Dial, MeLLmo, Meraki,MobileIron, MoboTap, Onavo, Quantenna, Sencha, Sourcebits, Square, Stoke, Synapsense, Trippy, Unity

    4tiitoo, AltoBridge, Animoca, Arcsoft, Borqs, CloudMade, Digital Chocolate, GainSpan, InVisage, ip.access, July, Kno,mFoundry, Mocana, NeuString, SecureKey, SkyCross, skyrockit, Sotera, Swrve, TOA, Total Immersion, Urban Airship

    AppRedeem, BankSimple, Bump, Drchrono, EggCartel, Everyme, Game Closure, Hyperink, just.me, Kno, MindlessDribble, Onswipe, Orchestra, Parse, Poshmark, ShowMe, Sincerely, SnapGuide, Swrve, Tagstand, Trippy

    Airy Labs, Astrid, Crittercism, Echoecho, Enterproid, just.me, Milk, Miso, Nettle, Ordr.in, Parse, Pocket Change, ReadIt Later, Rumble, Scvngr, Stickery, Subtext, ThinkNear, TweetNGo

    Aerohive, Apperian, Awarepoint, Cooliris, Crittercism, Fixmo, Flipboard, GOGII, iControl, INRIX, Jawbone, Kovio,Path, Session M, Shazam, Square, Stoke, Waze, WorkSmart

    4INFO, Cloudbot, do@, GameSalad, JiWire, Medialets, MomentFeed, Neul, Opinionaided (2), Qosmos, Siklu,Synapsense, Tango, Taptu, TOA, ViVOTech, Z2Live

    Animoca, Azumio, BlueSprig, Breezy, CellScope, Dropcam, GetJar, Hotel Tonight, Lookout, MoPub, Pipette, Qriously,Qwilt, Rovio, Shopmium, Skimble, SoundTracking

    Aerohive, CellScope, Euclid Elements, Leyden Energy, Millennial Media, Pipette, Pulse, SiliconBlue, Skimble,Stitcher, Subtext, TabbedOut, Tabula, Umami, ValueFirst Messaging, Vuclip

    Apsalar, AwayFind, Drchrono, FastCustomer, Khush, Life360, MindSnacks, Nettle, Punchd, Stickery, TaskRabbit (2),Twilio

    BlueStacks (2), Bump, Capriza, Everyme, Foursquare, Hyperink, Jawbone, Kno, Lookout, Massive Health, TinyCo,Wikets

    DoubleDutch, Drchrono, EggCartel, Fiksu, Game Closure, InVisage, Massive Health, Millennial Media, MotherKnows,Orchestra, Sincerely, SMS GupShup

    AliveCor, Apalya, ChaCha, Enterproid, ip.access, Livescribe, PowerCloud, Siklu, Sotera, ThinkNear, Xiaomi

    Appconomy, Gyroscope (2), just.me, Kiip, SoundTracking, Spectrum Bridge, Trippy, Urban Airship, Valencell,Yobongo

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    VC in MobileStrategic Investors

    Source: Rutberg & Company(1) Includes limited partnership venture firms formed through strategic investors.

    One in five transactions in mobile involve strategic investors. During 2011, 22.2% ofdeals involved at least one strategic investor(1), as compared to 20.6% in 2010.

    Four most active strategic investors in 2011:

    Other active investors in 2011 (3-6 deals) span media, advertising, retail, financial,

    enterprise, device, and infrastructure sectors:

    (23) (19) (11) (7)

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    Thank You

    Rutberg & Company ResearchContact Information

    Rajeev ChandManaging DirectorHead of [email protected]

    Nick MayberryEquity Research [email protected]

    Kyle Spraker

    Equity Data [email protected]

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    Rutberg & CompanyInvestment Banking

    Barry A. NewmanSenior Advisor

    Office: (415) 371-1186

    [email protected]

    351 California Street, Suite 1100

    San Francisco, CA 94104

    Telephone: (415) 371-1186

    800 Boylston Street, 16th Floor

    Boston, MA 02199

    Telephone: (857) 453-6798

    SAN FRANCISCO BOSTON

    Robert C. HarrisVice Chairman,

    Investment Banking

    Office: (415) 371-1186

    [email protected]

    Joseph S. SanbornManaging Director,

    Head of M&A

    Office: (617) 262-6694

    [email protected]

    Bryan B. Rutberg

    Chief Executive Officer

    Office: (415) 371-1186

    [email protected]

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    Rutberg & Company2012 Events

    April 23-25, 2012

    Claridges HotelLondon, England

    Rutberg Summit: London

    LONDON

    June 18-19, 2012

    Westin Market StreetSan Francisco, California

    Future:Mobile

    SAN FRANCISCO

    October 21-23, 2012

    Terranea ResortRancho Palos Verdes, California

    Wireless Influencers

    RANCHO PALOS VERDES