Proposal to Serve
Canaccord Adams
Summer Conference
G. Jarvis Coffin III
Chief Executive Officer
August 8, 2007
Safe Harbor Statement
This presentation contains "forward-looking" statements that involve risks, uncertainties
and assumptions. If the risks or uncertainties ever materialize or the assumptions prove
incorrect, our results may differ materially from those expressed or implied by such
forward-looking statements. All statements other than statements of historical fact could
be deemed forward-looking, including, but not limited to, any projections of financial
information; any statements about historical results that may suggest trends for our
business; any statements of the plans, strategies, and objectives of management for
future operations; any statements of expectation or belief regarding future events,
technology developments, or enforceability of our intellectual property rights; and any
statements of assumptions underlying any of the foregoing.
These statements are based on estimates and information available to us at the time of
this presentation and are not guarantees of future performance. Actual results could
differ materially from our current expectations as a result of many factors, including but
not limited to: the unpredictable nature our rapidly evolving market and fluctuations in
our business; the effects of competition; and any adverse changes in our customers’
business. These and other risks and uncertainties associated with our business are
described in our filings on AIM. We assume no obligation and do not intend to update
these forward-looking statements.
Shares of Burst stock are not available for purchase by U.S. persons and
accordingly this presentation is an update on the general business of Burst
Media and is for informational purposes only.
Company Overview
Our Company
• Burst Media works for Independent Web Publishers to
provide advertising representation, services and technology
across the broadest and deepest number of interest-based
websites online
• Independent web publishers are the heart, soul and future of
the internet and igniting their profitable growth benefits
everyone – publishers, advertisers and consumers
• Burst Media levels the playing field for independent web
publishers and allows advertisers to reach finely segmented,
engaged consumers — in a clutter-free environment — through
an extensive number of interest-based sub-channels
Our Business Units
•
•
•
•
•
Founded, 1995
13th largest Ad Network in the US & the UK*
6,200 total web sites
74 million & 12 million unique users in the US & UK*
21st & 19th largest Internet property in the US & UK*
Brand Advertising
Network for Independent
Web Publishers
•
•
•
4,200 web sites organized
into 20 content channels
Served 3.7 billion ad
impressions
High value, high impact
brand advertising
Note: Data is as of June 2007
*comScore media Metrix, June 2007
Complete Ad
Management Solution
•
•
•
End-to-end solution for web
publishers
Proprietary technology available
in desktop or enterprise editions
Served 1.7 billion ad
impressions
Direct Marketing Service
for High Volume
Campaigns
•
•
•
Fills unsold inventory on a
blind basis for large, branded
web sites, Burst Network
sites and smaller web sites
Reach and performance
focused service
3,800 web sites served 0.6
billion ad impressions
Independent Web Publisher Experts
* Sites are all part of the Burst Network. Burst Direct sites are represented on a blind basis only.
5
Continued Growth in Publishers
Network Publishers’ Web Sites
5,000
4,000
3,000
2,000
3,604
3,791
Jun'06
Dec'06
4,244
1,000
0
June'07
Direct Publishers’ Web Sites
5,000
Direct only
Combo
4,000
3,000
1,885
2,000
1,727
1,000
0
1,687
1,466
261
Jun'06
2,456
1,948
769
Dec'06
6
June'07
3,833
The Online Advertising Market
• Ad networks generate large internet reach, surpassing most portal sites
• Burst Media ranks 21st in terms of total reach and is the 13th largest ad network
Property
Rank
Total Users
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
Advertising.com**
ValueClick**
Yahoo!
Tribal Fusion**
Casale Media Network**
Blue Lithium**
Specific Media**
Google
AOL Media Network
Connexus - TrafficMarketplace**
MSN-Windows Live
DRIVEpm**
YAHOO.COM Home Page
24/7 Real Media**
AOL
Tremor Media
PrecisionClick**
adconion media group**
CPX Interactive**
Centro
Burst Media**
EBAY.COM
AdBrite**
MYSPACE.COM
ContextWeb**
Unique
Vistors (000) Reach (%)
178,839
157,639
132,404
131,559
125,358
120,527
119,439
118,640
116,632
114,043
110,635
103,300
95,719
93,755
91,556
91,432
85,358
79,629
79,474
77,247
74,599
73,686
72,368
71,923
70,478
65,150
Rank
100.0
88.1
74.0
73.6
70.1
67.4
66.8
66.3
65.2
63.8
61.9
57.8
53.5
52.4
51.2
51.1
47.7
44.5
44.4
43.2
41.7
41.2
40.5
40.2
39.4
36.4
26
27
28
29
30
31
32
33
34
35
36
37
38
39
40
41
42
43
44
45
46
47
48
49
50
Property
Vibrant Media**
AdDynamix.com**
Gorilla Nation Media
Interclick**
MSN.COM Home Page
Undertone Networks**
Ask Network
EBAY.COM Home Page
Business.com Network
YOUTUBE.COM
ABOUT.COM
WEATHER.COM
FACEBOOK.COM
Real Cities Network
Nick Kids & Family
Disney Online
CareerBuilder Network
CNN
PHOTOBUCKET.COM
IMDB.COM
Superpages.com Network
Lycos Network
EXPEDIA.COM*
Yellowpages.com Network
ARTISTdirect Network
Unique
Vistors (000) Reach (%)
65,018
63,825
62,299
53,796
53,232
52,783
52,600
45,306
43,611
42,986
36,815
29,580
27,965
27,302
25,237
23,443
22,767
22,375
22,371
21,862
21,426
20,479
19,360
19,340
19,157
Source: comScore, June 2007
Reach denotes the percentage of the total Internet population that viewed a particular entity at least once in June 2007.
* means the entity has assigned some portion of traffic to other syndicated entities.
** denotes an advertising network
7
36.4
35.7
34.8
30.1
29.8
29.5
29.4
25.3
24.4
24.0
20.6
16.5
15.6
15.3
14.1
13.1
12.7
12.5
12.5
12.2
12.0
11.5
10.8
10.8
10.7
The Online Advertising Market
The online advertising market continues to grow as advertisers shift spend
from traditional media to the internet
US Online ad spend ($billion)
$ Billions
•
Source: IAB/PWC Internet Advertising Revenue Report, May 2007
8
The Online Advertising Market
•
Despite rapid growth, the online advertising market remains concentrated
among a few players. The top 10 ad selling companies control roughly
70% of the online spend
•
The ad network model is important to helping advertisers break-through
to the rest of the Internet
Source: IAB/PWC Internet Advertising Revenue Report, May 2007
9
•
•
•
•
High Composition
Buying Impact
Powerful targeting tools
Quality assurance
Burst Network: Unique Targeting for Advertisers
• Presents multi-part messages to prospects to move
them through the purchase funnel/cycle.
• Presents multi-part messages to prospects to move
them through the purchase funnel/cycle.
• Targets audiences who previously visited the
advertiser’s website.
• Behavior Targeting based on an individuals prior visits to
Burst content channels and sub-channels.
• Identifies the most active members of the target
audience based on their explicit interests
Specifying
Unique
Visitors
• Custom site lists based on content, demographics, and/or sponsorship capabilities
• Transparent site lists available from the proposal through post-campaign reporting
Identifying
Specific
Content
• Selects a mix of attributes to form a unique, repeatable high-composition set of
sites based on the target audience
• Advertisers choose from 20 broad content channels to deliver high-reach
contextual campaigns, and from 450 content rich sub-channels
• Targets sites or channels that attract a high composition
of the desired audience
Targeting
Large
Audiences
• Targets by time-of-day and/or day-of-week at the server or
visitor location
• Captures daypart context – at work, before dinner,
entertainment hours, news retrieval
• Target audiences based on country, state, or
DMA/MSA
• Broad reach across the entire network of Burst
publishers
11
Burst Network: Unique Targeting for Advertisers
Advertisers benefit from their ads appearing on the broadest and deepest number
of interest-based web sites online, to reach finely segmented and optimally
targeted engaged consumers in a clutter-free environment
12
• Broad Reach
• Performance
Burst Direct: Reach and Performance
• Burst Direct serves the needs of direct response
advertisers seeking large audiences at cost effective
run-of-network rates
- Offers millions of impressions through over a thousand
member publishers and through inventory relationships
with large Internet portal sites
- Offers advertisers performance solutions to their
campaigns through placement, delivery and optimization
14
Burst Direct: Reach and Performance
Networks
Direct Advertisers
• Technology Platform
• Business Process Consulting
• Management Services
AdConductor: Complete Ad Business Management
AdConductor Desktop offers
features that enable independent
publishers to achieve greater
control over their primary online
advertising functions
AdConductor Enterprise offers
multi-site operators an end-to-end
ad solution with a consultative
set-up process, customization
and flexibility
–
–
–
–
–
–
– CRM Integration Proposal Building
Tools
– Campaign Management
– Ad Serving
– Campaign Optimization Tools
– Reporting Tools
– Billing / Credit Tools
– Publisher/Advertiser/Admin
– Back Office Data Integration
– Audience Backplane
Unified traffic forecasting
Order entry
Campaign management
Campaign optimization
Reporting
Advanced targeting (geo and
keywords)
– Enhanced campaign performance
– Support for rich media
17
AdConductor: Complete Ad Business Management
Only AdConductor Enterprise provides a complete end-to-end solution
First Call
(SalesForce.com)
Analyze & Report
Optimizer
Research
Run Campaign
(Ad Serving)
Invoice & Journalize
(Great Plains)
Proposal
(Sales Desktop)
Traffic/Campaign Management
Receive Payment
Legal Review
Credit
(Sync Great Plains)
Pay Publishers
(Great Plains)
AdConductor: Customers
Enterprise
Desktop
Financial Summary
Revenue
($ millions)
Total
50
45
40
35
30
25
20
15
10
5
0
5.9
8.2
13.8
21.6
23.5
31.4
38.0
17%
21%
34%
9%
0.6
2.5
4.8
40%
6.5
0.5
1.1
0.1
21.0
3.4
1.4
3.3
56%
68%
44.3
26.7
30.7
34.4
21.9
13.7
5.9
8.2
FY'02
FY'03
FY'04
Network
FY'05
FY'06
AdConductor
*House Analyst Estimates
21
FY'07*
Direct
FY'08*
FY'09*
Adjusted EBITDA
($ 000’s)
%
-51%
-13%
8%
16%
10%
13%
15%
16%
8,000
25%
6,000
42%
7,105
5,667
4,000
-28%
194%
2,000
-2,000
4,018
3,354
2,414
209%
1,140
65%
0
66%
-1,050
-3,017
-4,000
FY'02
FY'03
FY'04
FY'05
*House Analyst Estimates
22
FY'06
*FY'07
*FY'08
*FY'09
Organization
We continue to strengthen the management team and build out the organization
Senior Management Team
Total Headcount
Jarvis
Coffin
President & CEO
(1995 co-founder)
100
82
80
93
92
91
Q4'06
Q1'07
Q2'07
83
68
Susan
Villare
Harry
Klein
David
Cooperstein
CFO
(2007)
COO
(2000)
CMO
(2007)
Donald
Byrnes
Andi
Schneiter
Managing
Director
Burst Network
(2007)
Managing
Director
Burst Direct
(2006)
60
55
57
60
Q1'05
Q2'05
Q3'05
62
40
20
0
David
Stein
Lucinda
Zeman
CTO
(1995 co-founder)
Director of HR
(2004)
23
Q4'05
Q1'06
Q2'06
Q3'06
Year-to-Date Performance & Outlook
Pre-close Trading Statement
(Six Months Ended June 30, 2007)
•
•
•
•
Revenue increased 17% to $13.3M (2006: $11.4M)
Slow growth with Network
Rapid growth with Direct and AdConductor
Adjusted EBITDA, excluding equity – based compensation
and restructuring charges was $1.0M (2006: $1.2M)
• Net cash at 30 June 2007 was $11.6M (31 December
2006: $13.0M)
• Full first half 2007 press release scheduled for 18
September 2007
24
Summary
Recap of Historical Performance
• Despite successes, disappointing first-year performance on AIM
(2006)
• Met revised analyst expectations in December 2006
• First half 2007 in line with management’s expectations
Outlook
• Best-in-class, scalable ad management and ad serving platform
built for an ad network world
• Independent Web Publisher Experts
• Balanced product offering to address the essential requirements of
all publishers (and advertisers):
• Quality
• Quantity
• Price
Thank You!
G. Jarvis Coffin III
CEO
jarvis@burstmedia.com