Ybrant Investor Presentation Dec 7 2012

7/27/2019 Ybrant Investor Presentation Dec 7 2012

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Marketing Digital Media Worldwide


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Section 1 Snapshot 05

Section 2 The Opportunity 08

Section 3 About Ybrant 15

Section 4 Growth Strategies 26

Section 5 Financial Overview 29

Appendix Merger with LGS Global 31

ContentContent


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Snapshot

1


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6

Social Marketing

Expertise

Ybrant has widepenetration outside of US

for advertising content on

Facebook and is one of its

few selected marketing

API partners

4

Presence AcrossDigital Media Operates across the entire

digital marketing space

Provides flexibility to

customers to choose

online advertising

campaign formats on a

single platform

7

Market Scale Online advertising $107bn

market in 2012 growing to

$179bn by 2016

Social, mobile and video

are creating a new wave

of growth for digitalmarketing specialists

3

Strong IP Heritage as a technology

provider for digital

marketing industry IP ownership enables

higher margin, improved

unique offering and higher

share of advertising

budget

6

Global Presence Local presence in over 24

countries across 6

continents

Strength in emerging

markets such as Latin

America Plan to capitalize the

potential in India

2

Consumer Reach Creates 1.5bn searches

and 34bn impressions

every month Access to 200m unique

visitors per month

Customers include 3 of

top 5 global ad agencies

Associated with over

6,000 publishers

5

EffectiveAcquisitions 12 corporate investments

to date enabled global

scale and end-to-end

presence

8

Staff Base 1,000+ staff, ~300 based in

India

Provide technology

development, customer

service and sales potential

9

Sustainable Growth Organic growth and M&A,

led the digital marketing

revenue growth @CAGR

40.9% (2007-2012)

Continued growth

expected as market growsand Ybrant extends share

1

KeyKey Corporate HighlightsCorporate Highlights


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The Opportunity

2


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Internet Advertising is a USD 100bn Market..Internet Advertising is a USD 100bn Market..

Internet Advertising is now an essential part of every brand and media planners budget

In 2012, it surpassed newspaper as the second largest advertising medium by value spent, after TV

It remains the fastest growing segment within the advertising space

8

Global Internet Advertising Market (USD billions)

9 14

2029

3949 52

73

88

107

126

145

162

179

2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

2003-2012 CAGR:

31.0%

2012-2016 CAGR:

13.7%

Source: eMarketer


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drivendriven byby secularsecular growthgrowth inin internetinternet penetrationpenetration andand

consumersconsumers timetime andand moneymoney spentspent onlineonline

The gulf between portion of time spent online and portion of advertising spent online highlights

the opportunity for ad spending growth

Online ad spending growth is further stimulated by the shift in consumer spending habits while

online, demonstrated by the increase in e-Commerce

9

Average time spent by US adults Vs US ad spending share

39.8%

36.5%

13.2%

3.1%2.3%

38.9%

22.5%

9.3%

11.5%9.2%

TV Online* Radio Newspaper Magazines

Time spent share Ad spending share

Potential for ad spending

to match time spent

Source: eMarketer Sep & Oct 2012

* Note: online includes mobile

US Retail e-Commerce Spending (USD bn)

194

224

256

290

325

362

2011 2012 2013 2014 2015 2016

2011-2016 CAGR:

13.3%


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Monthly Time Spent on Facebook vs. Other Sites

WithinWithin internetinternet advertising,advertising, SocialSocial MarketingMarketing hashas

emergedemerged asas aa keykey marketingmarketing tooltool

Source: Company reports and CapStoneInvestment estimates

YoY Growth of Brand Engagement on Facebook

7:46

2:53 2:121:48 1:44 1:41 1:18 1:06

0

200

400

600

800

Facebook AOL Yahoo Google MSN YouTube Wikipedia AppleSource: Adobe Digital Marketing Report Q3 2012

Note: Brand engagement defined as likes, comments and shares

(Hrs)

10

100% 91% 649%996%

Q3 2011

284%

Q4 2011 Q1 2012 Q2 2012 Q3 2012

....which converts to a highly valuable, targeted user base actively engaging with advertising delivered to them

Facebooks Rising Share of the US Display Advertising Market

Source: IAB, ThinkEquityLLC estimates

Note: Google does not include Doublclickad traffic

2010A 2011A 2012E 2013E 2014E

Yahoo! share 14.3% 11.6% 9.9% 8.9% 8.1%

AOL share 4.7% 4.4% 4.2% 4.1% 3.9%

Google share 11.0% 14.9% 17.1% 19.4% 21.7%

Facebook share 11.7% 14.7% 18.0% 20.9% 23.7%

Other Share 58.3% 54.4% 50.8% 46.8% 42.5%Total 100.0% 100.0% 100.0% 100.0% 100.0%

International vs. Domestic Advertising Revenues from Facebook

Source: Pivotal Research

(USD mn)

Rapidly increasing brand engagement with consumers on Facebook has enabled it to become the #1 display

advertiser in the US

Even more rapid Facebook ad growth internationally, with international revenues set to overtake the US in 2013

Source: Company reports and CapStoneInvestment estimates

0

2,000

4,000

6,000

8,000

2004A 2006A 2008A 2010A 2012E 2014E 2016EUS Advertising Revenue International Advertising Revenue


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2

18

4

28

8

53

Latin America Asia Pacific

2010 2012 2016

2825

4333

67

52

North America EMEA

....andand EmergingEmerging MarketsMarkets growthgrowth isis forecastforecast toto accentuateaccentuate

furtherfurther asas internetinternet subscriber/penetrationsubscriber/penetration acceleratesaccelerates

11

Internet Subscriber (million) / Penetration (%)

North AmericaNorth AmericaNorth AmericaNorth America EMEAEMEAEMEAEMEA

Latin AmericaLatin AmericaLatin AmericaLatin America Asia PacificAsia PacificAsia PacificAsia Pacific

2000 2012E 2016E

108

*33.4%

274

*78.6%

334

*88.7%

CAGR: 8.1% CAGR: 5.1%

2000 2012E 2016E

113

*6.5%

776

*36.6%

1,009

*45.5%

CAGR: 17.4% CAGR: 6.8%

2000 2012E 2016E

18

*3.4%

255

*42.9%

462

*72.2%

CAGR: 24.7% CAGR: 16.0%

2000 2012E 2016E

122

*3.4%

1,101

*27.8%

1,583

*37.2%

CAGR: 20.1% CAGR: 9.5%

Internet Advertising Market (USD billions)

CAGR: 22.7%

CAGR: 11.8%

CAGR: 16.5%

CAGR: 11.6%

CAGR: 23.7%

CAGR: 17.8%

CAGR: 33.5%CAGR: 20.7%

Source: eMarketer, PwC Global entertainment and media outlook 2012-2016, United Nations, www.internetworldstats.com, Daiwa estimates

* Note: Penetration rate of internet


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13

Increasing

Personalisation

New digital

channels

Data rates

and tech

upgrades

Mobile

Tablet computing

Smart TV

Location based

Social marketing

Online video

Rich media

Long term ROI driver Effect on advertisement value

Smartphone

proliferation

+ Consumer time online+ Number of channels+ More targeted and

interactive experience

+ Data about consumers+ Targeting and ROI

analytics capability

+ Interactive experience+ Consumer participation

and response

+ Improvements inexisting internet

channels

+ Higher qualityadvertising and ROI

improvements

Evolution of online advertising channels

More targeted advertising, increasing interactivity, a richer internet experience and increasing

number of internet channels improves advertising ROI but increases complexity

As a result, internet advertising implementers are increasingly important to an effective campaign

Inc

reasingcomplexityan

dvalueaddtoadvert

isers

Shift to

performance

based ads+ Guaranteed ROI withmeasurable

advertisement value

CPC, CPL, CPM modelsCost per thousand

impression

Cost per clickCost per action

ThisThis wideningwidening digitaldigital experienceexperience && complexitycomplexity ofof optionsoptions

shouldshould extendextend relevancerelevance ofof digitaldigital marketingmarketing specialistsspecialists


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About Ybrant

3


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Owned Publishing

network

28 million uniquevisitors per month

YbrantYbrant hashas establishedestablished aa relevantrelevant presencepresence inin thethe GlobalGlobal

DigitalDigital MarketingMarketing EcosystemEcosystemAdvertisers Agencies

Internet

usersYbrant Publishers

MobileAdvertising

SocialAdvertising

Search

Advertising

Display

Advertising

Online Video

Advertising

Email and Lead

Generation

Affiliates with 2,000+

advertisers

Brands including:

Some of the

Fortune 500

companies

Major consumerproducts

conglomerates

Associates with 140+

agencies

Agencies including:

3 of top 5 global ad

agencies

Associates with

6,000+ third party

publishers in 140

countries including:

Facebook

Yahoo

120

million+

internet

users

Ybrants value proposition to advertisers & agencies: Access to publishers across the globe

Ad campaign optimisation technology to maximize ROIs

One-stop shop service to cover all digital advertising channels

1000+ staff base to provide complementary services

Ybrant value proposition to publishers: Multi-platform server optimizes advertising

inventory usage

Access to major advertisers and advertising

agencies across the globe

Dedicated account management service to

manage multiple clients on a single platform

1.5 billion searches generated and 34 billion

impressions created every month

15

Complementary services


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34 billion impressions every month

Technology-controlled buying platform

Advanced targeting capabilities

Local market campaign specialties

Customized technology leverages user behavior and

interests and optimizes advertising campaign

Campaign managers available 24/7 to manage campaignsand tackle issues

Click Through Rate (CTR) of ads is monitored and calculated

in order to choose the best ads, from the first clicks

Pixel tracking is available to follow conversion and

immediately affects which ads are shown

Premium Smartphone inventory

Exciting and engaging ad formats

Specialized pages and download tracking

Various engaging formats

Connection to popular content

Engaging and relevant

|Ybrant Search 1.5 billion searches generated by Ybrant Digital

28 million unique users per month generated by

Targeted, optimized ads focused on specific audience

Access to a number of publisher sites, increasing reach

Control over bidding prices being a self-owned publisher

network

|Ybrant Email Capable of sending up to 5 million emails on one server

per day

Provides clients with a scalable mass-mailing solution

Reporting, tracking and list maintenance

Global information technology implementation and

outsourcing services provider

Provides end-to-end enterprise solution offerings and

specializing in cloud computing, mobile software, ERPsolutions, Microsoft and open source systems development

|Ybrant Platforms

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|Ybrant Banner Extensive marketing reach for banner Ads

Real time bidding technology for optimal ad pricing

withwith aa widewide suitesuite ofof productsproducts


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....andand complementarycomplementary servicesservices basedbased onon InIn--househouse

TechnologiesTechnologies

17

Complementary ServicesDigital Media Planning and

Buying

Campaign Optimization and

Analysis

User Data Collection and

Aggregation

Ad Serving

and traffic monitoring

Customizable Applications and

Widgets

Licensed technology software

Creative enhancement for

performance

Technical advice for digital

marketing strategy

Search Optimization support and

management

Multi-time-zone support

structure

In-house Technology Examples

Facebook MarketingAn elaborate and developed

ad-optimization system for

Facebook which leverages API

connection to enhancecampaign results

Ybrant Digital AdCenter24/7 online access centralized

campaign reporting and

management console for client

activity on all digital platformsprovided by Ybrant Digital

Web Site CreatorWebsite building tool with

intuitive interface allowing the

placement of content or media

anywhere on the website

Campaign Analytics ReportAutomatically-generated digital

campaign summaries providing

stats, highlights, strengths and

weaknesses, and providing future

insights

Bank of CreativesAn easily browsed and managed

database of visual creative,

arranged according to the

attached performance capabilities

Mobile Ad ServerOwned server for mobile ads

of all available formats, able to

centrally control and prioritize

global mobile ad serving

Eureka Search ServiceA full Search-on-Site solution

for publishers of all sizes with

various customizable search

features and content

monetization tools

Auto-Optimization ToolsAutomatic optimization tools for

online campaigns which learn,

mimic and multiply the best

practices of campaign

management

Publisher One-TagSingle piece of code for

websites which presents,

monitors and optimizes the

advertising feed from all media

sources


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Display Social Mobile Video Search

Select

platforms

Location Timing Interests Segment Target

Cross-optimize

with technology

PC Tablet Phone Smart TV

Show on

all devices

Find your

audience

1

2

3

4

18

offered across all Digital Screen Revenue Segmentsoffered across all Digital Screen Revenue Segments


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Besides the established markets of US, Europe and Australia,

Ybrant has already built presence in LATAM and Asia, the

emerging markets19

delivering Global Campaigns, through Offices in 24 delivering Global Campaigns, through Offices in 24

Countries to 140 End Markets, and growingCountries to 140 End Markets, and growing


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200 million unique visitors across 2000+ publishers

1.1 billion impressions/day on network

In-house Data Management Platform

Significant keyword transaction data

Display across platforms

RTB Display

Social Platform

Mobile

Search

Email

CUSTOMER

DATA

In-house technology designed to deliver, maximize optimization across

platforms for best results

Pixel conversion tracking

Real-Time Reporting

Maximum optimization

App download tracking

Rich Media Creation

20

......thereby creating a veritable Data Management......thereby creating a veritable Data Management

PlatformPlatform


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Brands 2,000+ advertisers affiliated

Advertise some of the global brands

Ybrants is stacking complementary capabilities and have established network of advertiser and

publisher relationships globally, which is one of its key strengths

6,000+ publishers affiliated

Accessing 200 million unique visitors

Emerged as the player of relevance for

three of the top five publisher networks

globally

150+ agencies served

Clients include 3 of the top 5 global ad

agencies

~3700 digital campaigns managed in

November 2012

Ybrant was one of the few selected to be part of the

exclusive list of Facebooks preferred marketing developers

Exclusive provider of paid social advertising activity in

Argentina to a global consumer giant

Ybrant provides mobile advertising services to a major

globaladvertising agency

Extensive scale Recent Marquee business wins

Ybrant is a one of the key video partners for international

branding of one of the worlds largest household cleaning

products provider

Exclusive provider of social advertising services to major global

advertising agencies2 in Chile and one in Mexico

Exclusive sales house for all mobile advertising for Argentinas

one of the largest newspapers

Agencies

Publishers

..reflected in recent marquee wins..reflected in recent marquee wins


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1. US display advertising

Medios One and AdDynamix bolster ad network

reach and add execution and targeting technology

2. Email marketing

VoloMP adds email marketing software

3. Geographic expansion in display ads

Oridian, DreamAd and Max Interactive contribute

ad networks across Europe, Middle East, South

America and Asia

4. Portals and search syndication

Lycos adds search functionality, 70m users and a

search syndication platform

5. Major technology expansion

Web 3.0 provide technology and reach for mobile

marketing

LGS Global adds development capability for mobile

and cloud computing

Global endGlobal end--toto--end digitalend digital

marketing servicesmarketing services

Global endGlobal end--toto--end digitalend digital

marketing servicesmarketing services

USUSUSUS

Mobile andMobile and

TechnologyTechnology

Mobile andMobile and

TechnologyTechnology

PortalsPortalsPortalsPortals

DisplayDisplay

AdvertisingAdvertising

DisplayDisplay

AdvertisingAdvertising

Email andEmail and

LeadLeadGenerationGeneration

Email andEmail and

LeadLeadGenerationGeneration

LATAMLATAMLATAMLATAMEMEAEMEAEMEAEMEA APACAPACAPACAPAC

Medios OneMedios One

(2006)(2006)

AdDynamixAdDynamix

(2007)(2007)

VoloMP (2007)VoloMP (2007)

Oridian (2008)Oridian (2008) DreamAd (2009)DreamAd (2009)Max InteractiveMax Interactive

(2009)(2009)

Lycos (2010)

Web 3.0 (2011)Web 3.0 (2011)

1

2

3 3 3

4

5

4

44

44

4

44

Ybrants ability to identify, acquire and integrate investments has enabled the company to build a global end-to-end IP rich offering

Institutional Funding

CY2007: USD 28.5 Million from Sansar Capital, Passport Capital and others

CY2008: USD 33 Million from Everest Capital

CY2010: USD 18 Million from Battery March and Oak India Investments

22

LGS GlobalLGS Global

(2012)(2012)

5

4

Established track record of M&As to extend offering andEstablished track record of M&As to extend offering and

geographic reach..geographic reach..


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Back-end technology

provider

2006200620062006

TodayTodayTodayToday

End to End digital

marketing services

provider using third

party traffic

Add own publishers to

own traffic

Create a multi-

channel, multi-

device,

technologically

smart advertising

platform globally

Multi-platform digital

marketing capability

Access to advertisers

and publishers

Search marketing

capability and access tointernet users directly

Mobile marketing

capability

Cloud computing

capability

Software

developmentcapability

Cloud

Social

Video

Mobile

Online publishing

Advertising network

Core technology

development

23

..and emerge a value added player in the ecosystem,..and emerge a value added player in the ecosystem,

from a backfrom a back--end technology provider to digital networksend technology provider to digital networks


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4Growth Strategies


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Ride the Mobile and

Video Growth Waves

* eMarketer 2012 growth figures for mobile advertising

and online video advertising

Up-sell mobile and video ad

network offerings to vast

customer base

Capture the rapid growth

in each market

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Geographic Expansion

Extend relationships with

existing customers in new

markets

Eastern Europe, Africa,

China and Korea will be key

growth areas for Ybrant

Win global campaigns fromFortune 100 customers

Technology Upgrades

Leverage technology

development strength of

LGS Global

Create technologies

capturing new waves ofgrowth and enhancing

customer services

Add-on Services

+ Consulting

+ Campaign management

+ Analysis

+ Editing Services

Utilize 1,000+ global

workforce to take

increasing wallet share of

advertisers budget by

providing value added

services

Accretive M&A

Continue to make

acquisitions to build

capability and scale

Widen the Network

Increase advertisers and

publishers network using

compelling global

proposition and large

workforce

Cloud computingCloud computingCloud computingCloud computing Mobile video/webMobile video/webMobile video/webMobile video/web

Campaign analysisCampaign analysisCampaign analysisCampaign analysis Data managementData management

platformsplatforms

Data managementData management

platformsplatforms

Advertisers Publishers

1

3

5 6

2

4

Mobile:

+80.0% p.a.*

Video:

+46.5% p.a.*

At Ybrant, we believe that the global digital advertising industry is heading towards consolidation which will result in emergence of few

large global players. Ybrant aspires to be one of them.

Key Growth StrategiesKey Growth Strategies


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The boom in mobile and online video advertising is set to benefit online advertising networks with wide reach of advertisers and

publishers, as they begin to focus more on these new channels

US mobile ad spending, 2010-2016

Source: eMarketer, Sep 2012

US online video Ad spending, 2010-2016


While mobile handset penetration has reached near saturation in

many markets, mobile advertising is just beginning to become a

significant share of the digital advertising market

Mobile platforms enable more targeted adverts that demonstratehigher ROI and greater value to advertisers

Mobile advertising, in its infancy today, will grow market share to

make up 21% of the US internet advertising market in 2016

Online video growing rapidly driven by increasing range of video

capable devices, bandwidth increases and growth of online video

business models

As price points for tablets and smart phones come down, digital

video consumption will rise

According to eMarketer forecasts, more than half of the US

population will view video content through desktop or mobile

devices in 2012

Video and mobile are incremental to search and display, not

cannibalistic

While the delivery platform varies, the same advertisers are

delivering similar messages via many of the same publishers as fixed

line internet

The same advertising networks are well placed to benefit from the

future growth of video and mobile

1.42.0

2.9

4.15.8

7.08.0

40.8%46.5%

41.3%38.9%

21.6%

15.0%

0%

10%

20%

30%

40%

50%

0.0

2.0

4.0

6.0

8.0

10.0

2010 2011 2012 2013 2014 2015 2016

US$ billion

Online video ad spending y-o-y change

0.8 1.52.6

4.46.6

9.211.9

88.5%80.0%

69.0%

50.0%39.0%

29.0%

0%

20%

40%

60%

80%

100%

0.0

5.0

10.0

15.0

2010 2011 2012 2013 2014 2015 2016

US$ billion

US mobile ad spending y-o-y change

Organic Growth Led by Nascent Video and MobileOrganic Growth Led by Nascent Video and Mobile



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5Financial Overview


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Revenue (USD Mn) EBITDA (USD Mn)

Other Financial HighlightsNet Profit (USD Mn)

Source: FY2010 & FY2011 data are based on proforma financials; FY- year ending March 31INR /USD - 45.14 (FY2010), 44.65 (FY2011), 51.16 (FY2012), 52.70 (H1FY2013)

Half Year financials

74.1099.67

118.10

75.93

85.17

104.68

128.81

76.87

-

50.00

100.00

150.00

200.00

250.00

300.00

FY2010 FY2011 FY2012 H1FY2013

Software

Digital Marketing

21.77 23.82

12.59

17.19

53.18

30.49

-

10.00

20.00

30.00

40.00

50.00

60.00

FY2010 FY2011 FY2012 H1FY2013


26.02

33.27

37.49

20.84

-

5.00

10.00

15.00

20.00

25.00

30.00

35.00

40.00

FY2010 FY2011 FY2012 H1FY2013


Represented through a mix of organic and inorganic growth

Main drivers of growth: Growth from display advertisement (Banner

Ads) and platforms

Merged Entity

Software

Digital Marketing

Financial Growth with strong marginsFinancial Growth with strong margins

EBITDA (%) 21.6% 20.1% 21.5% 20.0%

PAT (%) 16.3% 16.3% 15.2% 13.6%

Operational synergies across products and regions

Low Debt: Equity Ratio

USD Mn FY2010 FY2011 FY2012 H1FY2013

Debt: Equity 0.22 0.24 0.21 0.18

ROE(%) (a) 22% 21% 22% 22%

(a) Based on average Capital Employed


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Appendix


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Display

(Banner)

Search

Advertising

Licensed

Technology

(Platform)

Email & Lead

Generation

Social

(Banner)

Ybrant Digital LGS Global

Experienced player in digital

marketing in India and globally

Presence across digital marketing

value chain

SynergyOne of the leading Indian Digital

Marketing Company

One of the leading Software Development

Company

Expertise in software development and

ERP implementation

SAP best performing partner South

2009 Award

(1) Adds to the

technology

backbone

through 100+

LGS Global

engineers

(2) Develop

products in

cloud &mobile

Consolidated Revenue : USD 246.91mn (FY2012)

Total Employees: 1020 (October 2012)

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Merger with LGS Global adds to the technical backboneMerger with LGS Global adds to the technical backbone


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Thank You

Ybrant Investor Presentation Dec 7 2012

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Transcript of Ybrant Investor Presentation Dec 7 2012