Rodman & Renshaw Annual Global Investment Conference September 13, 2010 Investor Presentation Exhibit 99.1 |
- Page 2 - Safe Harbor Statement This presentation contains certain statements that may be deemed to be “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements, other than statements of historical facts, that address activities, events or developments that the Company expects, projects, believes or anticipates will or may occur in the future, including, without limitation, the outlook for general industry conditions, future operating results, capital expenditures, expansion and growth opportunities, financing activities and other such matters, are forward-looking statements. Although the Company believes that its expectations stated in this presentation are based on reasonable assumptions, actual results may differ from those projected in the forward-looking statements. For a more detailed discussion of risk factors, please refer to the Company’s Registration Statement on Form S-1 and its periodic reports filed with the United States Securities and Exchange Commission (“SEC”). Vringo expressly disclaims any obligations or undertaking to update or revise any forward-looking statements contained herein to reflect any change in Vringo’s expectations with respect thereto or any change in events, conditions or circumstances on which any statement is based. |
- Page 3 - Vringo: Synonym for Video Ringtones • We provide a comprehensive platform of video ringtones for mobile phones • Software allows users to create, download and share mobile entertainment content • WAP and Web sites encompass robust content integration and distribution systems • 200+ Vringo-enabled handsets (Windows, BlackBerry, Android, Symbian, J2ME) • Library of over 5,000 video ringtones • 23 patents pending for software platform and mobile applications (one patent issued) • Present on major app stores (Nokia’s Ovi; coming to Verizon’s Android App Store) • Pre-linked on Sony Ericsson handsets (SE Walkman) • Founded in 2006 • 35 Employees • Headquarters located in New York • Sales office in Oxford (UK) • R&D based out of Israel • Strong early stage investors • Angel round of $2.4 M in 2006 • Warburg Pincus invested $12 M in 2007 • Bridge round of $3.0 M in Dec. 2009 • IPO in June 2010 raised $11 M with Maxim, Ladenburg, and Chardan |
- Page 4 - Established and Well Seasoned Management • Strong management team and BOD with experience in the U.S. financial markets • Track record of creating, running, investing and exiting successful technology companies Nascent and Fast Growing Markets • Only 17.6 M viewed mobile video in the US in Q4 2009 (1) • 4.6 B global mobile subscribers (2) • 534 M global mobile video subscribers by 2014 (3)(5) • $25 B mobile application market by 2014 (4)(6) • $29 B mobile content market by 2012 (3) Strong Platform for Growth • Scalable business model • Major contracts signed with international mobile carriers and content providers • Largest video ringtone library in the world (over 5,000 titles) Investment Highlights (1) Nielsen/New York Times (2) United Nations estimate (3) Multimedia Intelligence (4) Juniper Research (5) Not a projection for Vringo subscribers (6) Not a projection for Vringo market size |
- Page 5 - Deal with Everything Everywhere Ltd.; UK’s largest mobile company to launch Vringo together in the UK market Everything Everywhere operates both Orange (UK) and T-Mobile (UK) with combined total of over 30 M subscribers, and is owned by France Telecom and Deutsche Telekom First will launch with Orange (UK) subscribers in Q4 Working hard to ensure top notch content for this critical launch STAY TUNED--NEWS TO FOLLOW |
- Page 6 - Importance of Orange Launch • First major launch in the strategic European market • UK is a vibrant and active mobile content and application market • Vringo has until now focused on proving its business model in smaller, less developed markets • Terms: Orange branded service, revenue split, zero rating for data, promotion of service on Orange properties STAY TUNED--NEWS TO FOLLOW |
- Page 7 - Starting in North America---with Verizon and Android Vringo has been approved to launch on the Verizon Android App Store in Q4 Verizon has sold the most Android phones in North America Verizon has 90 M subscribers and has a culture of app promotion and usage among subscribers Android has now overtaken iPhone in North American unit shipments according to Gartner Aug 12, 2010 Business Week STAY TUNED--NEWS TO FOLLOW |
- Page 8 - Time for T-Pain…… Vringo launching new application for iPhone and Android with T-Pain in Q4 T-Pain’s earlier iPhone app “I am T-Pain” became one of the most popular music apps of all time selling 1.5 M copies STAY TUNED--NEWS TO FOLLOW |
- Page 9 - “One of Israel’s leading venture capitalists” (Washington Post) Founder of Israel Seed Partners, managing $260 M in 4 funds-exits include: • Shopping.com (acquired by eBay Inc.) for $640 M • Answers Corp. (NasdaqCM: ANSW) • Native Networks (acquired by Alcatel (NYSE: ALA)) • Compugen (Nasdaq: CGEN) • Xacct Technologies (acquired by Amdocs Ltd. (NYSE: DOX)) • Business Layers (acquired by CA, Inc. (NasdaqGS: CA)) • Cyota (acquired by RSA/CA NasdaqGS: CA) Manager of several startups with exits including: • MERET (acquired by Amoco/BP) • Accent (Nasdaq: ACNTF) Seasoned Management & Governance Jon Medved Founder & CEO, Board member David Goldfarb CTO Formerly Degel Software David Corre VP Finance Formerly Siemens Dov Frohlich COO Formerly NMS Communications Haim Cohen-Mintz VP Europe Formerly Neustar Josh Wolff VP Services & Solutions Formerly NMS Communications Andrew Perlman President and Board member Formerly EMI Music |
- Page 10 - Was Founder, Chairman and CEO of the Beanstalk Group, the world’s largest independent licensing agency, now part of the Omnicom Group. Served leading Brands such as: • AT&T • IBM • Harley Davidson • Unilever • Ford Motor Company Vringo Board of Directors Seth (“Yossi”) Siegel Chairman of the Board Several time LIMA and Clio award winner Marketing and brand commentary appears in the NY Times, BrandWeek, Wall Street Journal, etc. Ralph Simon Board Member Chairman Emeritus Founder MEF - Americas Founder and CEO Relegance, sold to AOL Edo Segal Board Member Jon Medved CEO and Board member Formerly Founder and GP Israel Seed Phil Serlin Board Member Chairman, Audit Committee CFO BiolineRX Formerly Coopers, SEC Gary Ginsberg Board Member Executive VP, Time Warner, Formerly NewsCorp Board Andrew Perlman President and Board member Formerly SVP, EMI Music |
- Page 11 - • Mobile video has arrived • Mobile video data usage is expected to grow at a 131% CAGR from 2009 - 2014 (1) • 534 M global mobile video subscribers by 2014 (2) • Five-fold increase since 2008 • $16 B in revenues projected in the US (2) • Mobile social networking is growing exponentially • Facebook and Twitter at the forefront of the phenomenon • Growing mobile social networking and user-generated content revenue • $1.8 B in 2008 to $11.8 B in 2013 (3) • Approximately 1 out of every 8 people world-wide has used a digital social network (4) • User generated content continues to grow • YouTube revolution • Advances in technology that facilitate the creation of user-generated content • Rise of smart phones • Global Smartphone shipments experienced 50% growth YOY in Q1 2010 (5) • Increased bandwidth enables rich media transfer across many devices • Apps everywhere…with Android growing % of market share by 150% in Q4 2009 (6) • Global 3G penetration expected to exceed 20% by the end of 2010 (4) Vringo in Middle of Rapidly Growing Markets and Trends (1) Cisco Visual Networking Index: Global Mobile Data Traffic Forecast Update, 2009-2014, 2/10 (2) Pyramid Research (3) Juniper Research (4) Morgan Stanley’s Internet Trends, 04/10; comScore Global, 12/09 (5) Strategy Analytics (6) Comscore |
- Page 12 - Ring Tone Market-Ready for Vringo’s Innovation • Ringtone business was created in 1997 • Further developed in 2002 with the creation of truetone and mastertone • Ringback tone was created in 2004 • $4.7 B ringback tone market by 2012 (1) • 3x growth from 2008 • More than one-third of mobile users download ringtones from various sources (1) • 40% of such users frequently change their ringtones • Ringtone business has seen little innovation since 2004 • Market ready for next evolution of products and services (1) Ipsos MediaCT |
- Page 13 - 1. Justin logs onto Vringo.com on his PC/mobile or browses through his Vringo application for a new clip 3. Vringo server is updated immediately 4. Justin’s new Vringo is automatically sent to all of Justin’s buddies 5. New Vringo is cached on handsets, ready to be played whenever Justin calls Justin HTTP TCP/IP Vringo server Vringo clients Vringo.com Vringo Mobile App HTTP 2. Justin picks out a Rolling Stones clip and makes it his phone’s ringtone Getting a New Vringo Onto a Phone |
- Page 14 - Special Features Supported by Vringo Technology VringForward™ Mobile Video Voting Rewards Context-Appropriate Advertising • Decide what ringtone friends see when you call them • Get video ringtones as rewards for voting on contest shows • Receive relevant commercial messages (post-, pre-roll, post- call) Brought to you by Your Favorite Brand Thanks for voting! Get an exclusive video clip at: http://URL Vote!!! |
- Page 15 - Future of Mobile Personalization audio ring tone audio ring back tone video ringtone Audio ringtone market today Phone capabilities Vringo’s market video ringback/ ring forward Better user experience New revenue opportunities social personal- ization tools |
- Page 16 - Four Product Platform Components Mobile application Channels - automatic content delivery Custom store fronts Studio - online ringtone editor • Customer store front • Viral marketing engine • 300+ handsets • Java, Blackberry, Windows Mobile, Android, Symbian • Opportunity exists to sell premium content bundles based on the core application • World’s first Web-based video ringtone editor • Can be customized for partners (e.g., Marvel) • Video ringtones have a shorter shelf life • Customers can subscribe to automatic content refreshes • Customizable web/mobile store front • TV networks, retailers, political campaigns, live events • Opportunity exists to set up advertising- supported storefronts – “free” to consumers Indicative example |
- Page 17 - World’s Largest Video Ringtone Library 5,000+ video clips |
- Page 18 - Signed Revenue Deals: Initial Basis for Growth Markets in which we have launched or will launch our service have several hundred million mobile subscribers (1) Currently in discussions with several other carriers pursuing additional agreements over the next 12 - 24 months (1) Source: United Nations |
- Page 19 - Simple, Scalable Business Model Target: $6 - $12 per user per year for Net Vringo ARPU Premium: $1-3 per clip Monthly user subscription User Vringo Operator $1.0 - $3.0 No data traffic charges $0.3*-$1.5 $0.6 - $2.0 X Operator penetration Target Modeling assumptions 4-6% Current audio RBT 1-2%** ~15% * Effective revenue of $0.15 per subscriber - net of uncollected subscription fees ** Penetration of addressable market within 1 year of new market launch |
- Page 20 - 5 Launches So Far… Name of Operator/Partner Launch Date Operator Subscribers (M) Growth Potential MTS Group/Vivacell (Armenia) July 2009 2 Part of MTS Group which has 100 M subs Maxis (Malaysia) October 2009 11.4 Largest operator in Malaysia Avea (Turkey) November 2009 12.1 Third largest operator in Turkey; subsequently replaced by agreement with Retromedya Etisalat (UAE) March 2010 7.3 Group includes 16 countries, 94 M global subs RTL (Belgium) May 2010 11 Launching via TV ads, etc. on all 3 major carriers Verizon (US) Pending: 4Q 10 > 92 Initial launch for Blackberry & Android phones Everything Everywhere Ltd. (Orange (UK) / T-Mobile (UK)) Pending: 4Q 10 > 30 UK’s biggest communications company jointly-owned by Deutsche and France Telecom • 2 Pending Launches will Grow Addressable Market by 3X |
- Page 21 - Promising Results: Carrier #1 • Since service launch with mid-tier carrier, user acquisitions have grown • 3x per quarter and transactions have expanded at 4x per quarter • 70% conversion to paid subs after free trial period • Opt-out rates of less than 5% |
- Page 22 - User Growth: Carrier #2 • Since launch in 2009, new registrations have grown steadily • Over 40 K registrations in 6 months • Carrier reports Vringo is among its fastest growing paid services |
- Page 23 - Marketing the Service: Sample Collateral |
Consistently Winning Industry Awards Best mobile service for social community and user generated content - October 2007 Best use of phone functionality - December 2007 Always On Top 100 Media winner - January 2008 Best mobile social networking service, 2 place - January 2008 Finalist - March 2008 Best mobile community/fan content - November 2008 Winner Red Herring 100 - April 2009 Best ringtone innovation - June 2008 - Page 24 - nd |
- Page 25 - Major Outlet Media Coverage “offers an eyeful…has to be seen to be believed” “Vringo has something that others lack…the caller has the power” “the next level ringtone…this company’s fun and unusual product is just getting better and better” “every call thus becomes an opportunity to share content and to establish identity…Vringo has a head start over competitors” “the service aims to tap consumer’s obsession with creating their own content” “the next big thing in ringtones…soon everyone could have a Vringo, a personalized video ringtone” “Next big thing in the ringtone wave” |
- Page 26 - • Growing our business in the countries where we have launched • Continue to grow organically in each, driving subscription revenue • Adding new customer acquisition techniques, such as: • Voting, USSD, advertising • Add additional carriers in the territory • Rolling out new countries and partners • Continuous development of a rich pipeline • Add 2-3 territories/partners per quarter • Migration to wealthier markets • Bring new monetization models into play • Advertising-based Vringo will become important • App stores and content bundles • Leverage carrier relationships for new services Three Drivers of Growth |
- Page 27 - Multiple Waves of Growth Via New Operators TWO discussions THREE signed FOUR engaged FIVE upside 5 One country of a multi-country operator Operators Geographical Focus 6 Other countries in the same group/other operators in same country 11 Leading South Asian operator aggregator (Hungama) 10 EU, NA, and APAC operators ~ 20 44 M 150 M 440 M 200 M ~ 800 M The rest 4.6 B mobile subscribers + + + = Operator Subscriber Base Driving to Quarterly Breakeven by end 2011 + + + ONE deployment |
- Page 28 - 2Q 2010 Operational Summary • Successfully completed U.S. initial public offering raising $11M in gross proceeds. Issued 2,392,000 units (1 share common, 2 warrants) at IPO offering price of $4.60 per unit. • Units separated July 27 into common (VRNG) and warrants (VRNG-W) • Second quarter revenues of $44,000 compared to $0 in the second quarter of 2009 • Finished quarter with $9.7 million of cash on hand • Number of commercial subscribers increased to 66,000 • 61% sequential increase from previous quarter • Signed partnership with T-Pain for new app anticipated to launch in 4Q 2010 • Announced intent to offer Vringo on Verizon Android App Store |
Recent Vringo News • Issuance of first patent -- U.S. Patent No. 7,761,816 (Application No. 11/544,938) -- 7/20/10 • Launch broadcast marketing campaign with RTL Belgium (division of Bertelsmann) with new exclusive content from Nouvelle Star, Twilight, Desperate Housewives (www.myvringo.be) • Retromedya agreement to expand Vringo’s billing coverage in the Turkish mobile market making Vringo available to substantially all 64 million Turkish mobile subscribers • FusionSports Marketing Group exclusive content from clients including: Ray Lewis; Derrick Johnson; Donnie Avery; Rashard Lewis; Doc Patton; Kenny “The Jet” Smith; Marshevet Myers - Page 29 - |
- Page 30 - Deal with Everything Everywhere Ltd.; UK’s largest mobile company to launch Vringo together in the UK market Everything Everywhere operates both Orange (UK) and T-Mobile (UK) with combined total of over 30 M subscribers, and is owned by France Telecom and Deutsche Telekom First will launch with Orange (UK) subscribers in Q4 Working hard to ensure top notch content for this critical launch Vringo-Orange Announcement – Breakthrough in Europe |
- Page 31 - Importance of Orange Launch • First major launch in the strategic European market • UK is a vibrant and active mobile content and application market • Vringo has until now focused on proving its business model in smaller, less developed markets • Terms: Orange branded service, revenue split, zero rating for data, promotion of service on Orange properties |
Starting in North America---with Verizon and Android Vringo has been approved to launch on the Verizon Android App Store in Q4 Verizon has sold the most Android phones in North America Verizon has 90 M subscribers and has a culture of app promotion and usage among subscribers Android has now overtaken iPhone in North American unit shipments according to Gartner Aug 12, 2010 Business Week - Page 32 - |
Time for T-Pain…… Vringo launching new application for iPhone and Android with T-Pain in Q4 T-Pain’s earlier iPhone app “I am T-Pain” became one of the most popular music apps of all time selling 1.5 M copies - Page 33 - |
- Page 34 - Strong Financial Position to Finance Growth Cash and cash equivalents 9,692 744 Total current assets 9,847 3,518 Total assets 10,105 3,789 Total current liabilities 2,320 3,649 Total long-term liabilities 5,168 4550 Total stockholders’ equity 2,617 (16,378) Total liabilities and stockholders’ equity 10,105 3,789 June 30, 2010 December 31, 2009 ($ 000) (Unaudited) (Audited) |
- Page 35 - Company Snapshot Stock Exchange/Ticker: NYSE Amex: VRNG VRNG Recent Price (9/8/10): $1.25 Shares Outstanding: (6/30/10) 5.1 M Market Cap: $6.4 M 2Q10 Revenue / Sequential growth rate: $44 K / 47% In-the-money warrants (6/30/10) 482,346 Out-of-the-money warrants (6/30/10) 7.7 M 2Q 10 Net Income (Loss): ($4.6 M) Granted stock options 3.1 M Total Liabilities (6/30/10): $7.5 M Director and Officer Ownership: 8.7% Warrant Exchange/Ticker: NYSE Amex: VRNG-W VRNG-W Recent Price (9/8/10): $0.25 VRNG-W exercise price & expiration $5.06; 6/21/15 |
- Page 36 - Investment Highlights Established and Well Seasoned Management • Strong management team and BOD with experience in the U.S. financial markets • Track record of creating, running, investing and exiting successful technology companies Nascent and Fast Growing Markets • Only 17.6 M viewed mobile video in the US in Q4 2009 (1) • 4.6 B global mobile subscribers (2) • 534 M global mobile video subscribers by 2014 (3) • $25 B mobile application market by 2014 (4) • $29 B mobile content market by 2012 (3) Strong Platform for Growth • Scalable business model • Major contracts signed with international mobile carriers and content providers • Largest video ringtone library in the world (over 5,000 titles) (1) Neilsen/New York Times (2) United Nations (3) Multimedia Intelligence (4) Juniper Research |
Rodman & Renshaw Annual Global Investment Conference September 13, 2010 Investor Presentation |