Internet DealBook

Second quarter global M&A and

investment activity
1 April - 30 June 2018

Internet DealBook is published by Right Click Capital

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Informational Sources
All information contained in this presentation was sourced using Internet.
DealBook’s database. All additional information used to create the IDB
indices, was sourced from InternetWorldStats.com on January 2018.
Internet DealBook collects and compiles all their data from publicly
available sources. Average deal values are calculated using only deals
where the value has been disclosed. Visit Internet Dealbook for more
information on the methodology used for tracking and collating deals.
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Overview – sectors and regions

Sectors Regions

§ Ecommerce § Asia & Pacific

§ Games
§ Hardware & Infrastructure
§ Marketing
§ Media
§ Mobile & Apps
§ Software & Services
§ Transactions
§ Europe
§ Middle East
§ North America
§ Rest of World
§ South America
Global summary
2,805 deals tracked from public sources in
Q2 2018, an increase from 2,114 in Q2 2017
$111.0bn of deals tracked in Q2 2018, a
97.9% increase from $51.2bn in Q2 2017
$27.1m recorded in median acquisition
deal value in Q2 2018, a decrease from $55.9m
in Q2 2017. Average deal value sits around
$400.2m in Q2 2018 from $241.6m in Q2 2017,
where large acquisitions took place in the
Transactions and Software & Services sectors
$6.4m recorded in median investment
deal value in Q2 2018. This is an increase from
$6.0m in Q2 2017. Average deal value reached
$31.7m in Q2 2018, a decrease from $33.7m
recorded in Q2 2017
1,100 deals recorded in the Software &
Services sector, making this the most active of
all sectors
16 companies received investment from
Tencent, one of the most active venture
investors. The majority of these funds went
into Chinese companies. Alibaba and Softbank
followed closely, each making investments
into 11 technology-based businesses, mostly
in China
Geographic overview
Number and spread of deals by region

682

24.3%

48.2% Asia/Pac
Europe 24.2%
and
North Middle East
1,352 America 690

Africa

South
24 America

2.0%
<1%
57

§ The number of deals tracked reached 2,805 deals, up from 2,114 deals in Q2 2017
§ Around 72.5% of deals recorded were investments into technology businesses, with the remaining 27.5% being acquisitions.
This compares with approximately 63% of Q2 2017 deals being investments and 37% being acquisitions. This trend will likely
continue in 2018 as global private equity and venture capital dry powder is at all time records
 Top ten countries
Country Deal value ($bn) ADV ($m) Deal number

US 48.16 38.41 1,254

China 22.44 84.38 266

India 17.46 113.35 154

Switzerland 2.76 86.24 32

Singapore 2.61 50.20 52

France 2.07 42.32 49

UK 2.02 24.08 84

Japan 1.18 69.59 17

Canada 1.15 4.71 244

Israel 1.11 42.86 26

Note: ADV = average deal value

 Geographic overview
Deal value by region ($bn) ADV ADV
2017 – 80.74m 2017 – 35.90m
50.00 2018 – 125.00m 2018 – 57.95m

46.50 49.14
45.00

40.00

35.00

30.00
Billions

25.00 22.76
ADV
20.00 2017 – 30.75m
18.89
2018 – 30.68m
15.00
13.96
10.00 ADV ADV ADV 8.58
2017 – 22.64m 2017 – 26.40m 2017 – 16.16m
2018 – 6.93m 2018 – 11.82m 2018 – 16.52m
5.00
0.11 0.12 0.34 0.37 0.53 0.88
0.00
South America Rest of World Middle East Europe Asia/Pac North America
2017 2018

§ Asia/Pac – total deal value more than doubled and average deal value increased significantly due to large investment rounds
fueled by Asia’s technology giants SoftBank, Tencent and Alibaba, who invested heavily into Chinese companies in Q2 2018

§ North America and Europe – total deal value and average deal value increased due to a higher number of billion dollar
acquisitions. There were eight billion dollar deals in Q2 2018 compared to only one in Q2 2017. Examples include Microsoft
purchasing GitHub for $7.5bn, and Adobe paying $1.7bn for Magento

Note: ADV = average deal value

 Sector overview
Deal value by sector ($bn) ADV
ADV 2017 – 24.88m
40.00 2017 – 56.80m 2018 – 49.02m
2018 – 53.12m

35.00 33.73
32.03
ADV
30.00 2017 – 154.34m
2018 – 216.34m

25.00
22.53
20.73
Billions

20.00
ADV ADV
2017 – 127.34m 2017 – 23.75m
15.00 2018 – 153.14m 13.24
2018 – 70.73m
ADV
10.00 ADV
ADV 2017 – 17.67m 8.88 8.98
2017 – 38.18m
2017 – 44.45m 2018 – 27.44m 6.17
2018 – 11.42m
2018 – 33.07m 4.58
5.00 3.18
2.41 2.28
0.57 1.07 1.06 0.74
0.00
Mobile & Apps Games Marketing Media Hardware & Ecommerce Transactions Software &
Infrastructure Services
2017 2018

§ Software & Services – total deal value more than doubled and average deal value saw a large uptick as five multibillion dollar
deals were recorded in this sector, all of which were US-based acquisitions

§ Ecommerce – experienced an increase in total deal value due to three multibillion dollar investment rounds into companies
based based in India, China and the US, including Walmart’s $16bn acquisition of Flipkart

Note: ADV = average deal value

Investments – geographic overview
Number and spread of investments by region

479

23.6%

44.3% Europe Asia/Pac

29.2%
and
North
898 America
Middle East
591

Africa

South
17 America

2.1%
<1%
42

§ The number of investment deals tracked reached to 2,027 deals recorded, up from 1,339 deals in Q2 2017
§ By no surprise, North America leads the world in number of deals recorded with almost 45% of total investments tracked going
into US companies. This is driven by its strong venture capital and private equity/growth equity markets, and a maturing and
proliferating technology market. This trend is spread in Asia/Pac and we can expect the number of investments to continue rise
in this region in 2018
 Investments – sector overview
Investment value by sector ($bn)
25.00
ADV
2017 – 54.07m
2018 – 35.52m

20.00 ADV 19.14

2017 – 19.85m 20.28
2018 – 24.38m

15.19
15.00
Billions

10.12
10.00 ADV ADV
ADV 2017 – 65.35m 2017 – 37.45m
2017 – 21.87m 2018 – 50.85m 2018 – 101.80m
ADV 2018 – 34.93m
ADV 2017 – 34.53m ADV 5.09
2017 – 17.50m
4.93
5.00 2017 – 47.40m 2018 – 11.42m 4.02
2018 – 22.25m 2018 – 11.42m
2.11 1.97 2.42
0.95 0.72 1.16 1.24
0.49 0.57
0.00
Games Mobile & Apps Marketing Hardware & Ecommerce Media Software & Transactions
Infrastructure Services
2017 2018

§ Media – investments into Media companies rose in Q2 2018, with $100m+ cheques being written into Chinese and US
companies. For example, Chinese online parenting platform Babytree received $2.19bn at around a $20bn valuation

§ Software & Services – competition in China and the US helped drive an increase in average deal value, resulting in an uptick in
total deal value by almost 50%

Note: ADV = average deal value

Investments – top ten deals

Company Sector Raised ($bn)

Ecommerce 3.00

Media 2.19

Transactions 1.90

Transactions 1.90

Hardware & Infrastructure 1.00

Transactions 1.00

Hardware & Infrastructure 0.82

Media 0.80

Software & Services 0.70

Transactions 0.70
Acquisitions – geographic overview
Number and spread of acquisitions by region

202

26.3%

58.9% Asia/Pac
Europe and 11.9%
North Middle East
452 America 91

Africa

South
7 America

2.0%
<1%
15

§ North America – total number of acquisitions increased from 440 in Q2 2017 to 452 in Q2 2018. Most consolidation took place
in the Software & Services sector, which accounted for approximately 44% of total number of acquisitions

§ Asia/Pac – though the number of acquisitions declined 20% in Q2 2018, from 114 to 91 deals, total acquisition value increased
to almost $20bn from less than $324m the year prior. This meteoric rise can mostly be attributed to Walmart’s $16bn
acquisition of Flipkart (larger than all Q2 2017 global acquisitions combined)
 Acquisitions – sector overview
Acquisition value by sector ($bn) ADV
2017 – 144.52m
2018 – 896.09m
25.00
27.75

ADV
20.00 2017 – 141.56m
2018 – 287.59m

18.54

15.00
Billions

10.00
ADV
ADV ADV 2017 – 51.98m
2017 – 1251.82m 2017 – 1116.12m 2018 – 438.54m
2018 – 266.21m ADV 2018 – 474.04m
2017 – 24.53m 4.97
5.00 ADV ADV
2017 – 29.70m
3.76 2018 – 144.20m
3.35 3.79
2017 – 149.50m 3.11
2018 – 0.00m 2018 – 47.61m 2.02
1.60 1.59
0.30 0.000 0.12 0.57 0.02 0.31
0.00
Mobile & Apps Games Ecommerce Marketing Media Hardware & Software & Transactions
Infrastructure Services
2017 2018

§ Globally, total acquisition values more than quadrupled, from $12.6bn in Q2 2017 to $52.1bn in Q2 2018
§ As total acquisition values and average deals value rose in North America and Asia/Pac in 2018, the sectors that soared highest
were Transactions, Software & Services, and Hardware & Infrastructure

Note: ADV = average deal value

 Acquisitions – sector overview
ADV
Acquisition value by sector ($bn) ADV 2017 – 141.56m
2017 – 1251.82m 2018 – 285.17m
20.00 2018 – 2583.19m
18.536
18.00 17.597

16.00 ADV
2017 – 144.52m
14.00 2018 – 896.09m

11.750
12.00
Billions

10.00
ADV
8.00 ADV 2017 – 51.98m
2017 – 1116.12m 2018 – 438.54m
ADV 2018 – 474.04m
6.00 4.966
2017 – 24.53m
ADV ADV 2018 – 144.20m 3.792 3.76
4.00 2017 – 29.70m 3.35 3.11
2017 – 149.50m
2018 – 47.61m
2018 – 0.00m 2.019
2.00 1.59
0.30 0.569 0.31
0.000 0.12 0.02
0.00
Mobile & Apps Games Marketing Media Hardware & Transactions Ecommerce Software &
Infrastructure Services
2017 2018

§ Globally, total acquisition values more than quadrupled, from $12.6bn in Q2 2017 to $52.1bn in Q2 2018
§ As total acquisition values and average deals value rose in North America and Asia/Pac in 2018, the sectors that soared highest
were Transactions, Ecommerce and Software & Services

Note: ADV = average deal value

Acquisitions – top 10 deals

Company Acquirer Sector Value ($bn)

Ecommerce 16.00

Software & Services 7.50

Media 3.65
Hardware &
2.74
Infrastructure
Transactions 2.70

Transactions 2.20

Software & Services 2.00

Transactions 1.86

Software & Services 1.68

Marketing 1.60
 Australia summary
53 deals tracked from public sources in Q2
2018, a 9% decrease from Q2 2017
$446.9m of investments and acquisitions
recorded in Q2 2018, a 3% decrease from Q2
2017
$164.5m recorded in total acquisition
deal value in Q2 2018. This is an increase from
$120.0m recorded in Q2 2017. Average deal
value for acquisitions decreased, from $120.0m
in Q2 2017 to $37.7m in Q2 2018
Note: all amounts in AUD
$282.4m recorded in total investment
deal value in Q2 2018. This is a decrease from
$339.3m in Q2 2017. Average deal value was
$9.4m in Q2 2018, a decrease from $10.3m in
Q2 2017
27 transactions were recorded in the
Software & Services sector, making it the most
active with total deal value rising by more than
450%
10 acquisitions occurred in the Software &
Services sector, where REA Group’s $130m
acquisition of Hometrack accounted for over
30% of total deal values in Australia
 Australia sector overview

Sector Q2 2017 total deal value ($m) Q2 2018 total deal value ($m)

Software & Services 60.1 353.6

Transactions 130.2 85.4

Ecommerce 125.0 4.0

Media 0.0 3.9

Hardware & Infrastructure 62.8 0.0

Marketing 75.9 0.0

Games 0.0 0.0

Mobile & Apps 5.3 0.0

Note: all amounts in AUD

 Australia – top ten deals

Company Buyer/investor Deal type Sector Value ($m)

Acquisition Software & Services 130.0

Consortium Investment Software & Services 84.6

Consortium Investment Software & Services 60.0

Consortium Investment Transactions 18.5

Investment Transactions 15.0

Acquisition Software & Services 12.5

Consortium Investment Transactions 11.5

Consortium Investment Software & Services 10.0

Consortium Investment Software & Services 8.5

Investment Software & Services 8.5

Note: all amounts in AUD

Investments – sector overview

Number of investments by sector

0% 0%
0%
3%
3%
6%
Transactions = 15
Software & Services = 14
Media = 2
Ecommerce = 1
46%
Marketing = 1
Hardware & Infrastructure = 0
Mobile & Apps = 0
42% Games = 0

§ Australia saw a 6% decrease in number of investments between Q2 2017 and Q2 2018

§ Investments in Hardware & Infrastructure and Mobile & Apps were down 100%

§ Investments in the Software & Services and Transactions sectors were up 40% and 36% respectively
Acquisitions – sector overview
Number of acquisitions by sector
0% 0% 0%
5%
5%
Software & Services = 13
5%
Transactions = 4
Marketing = 1
Mobile & Apps = 1
Ecommerce = 1
20%
Media = 0
Hardware & Infrastructure = 0
65% Games = 0

§ Total number of acquisitions in Australia decreased by 13% from Q2 2017 to Q2 2018, from 23 transactions down to
20
South East Asia summary
86 deals tracked from public sources in Q2
2018, a 25% increase from Q2 2017
$2.3bn of investments and acquisitions
recorded in Q2 2018, a 3% decrease from Q2
2017.
$433.5m recorded in total acquisition
deal value in Q2 2018. This is a huge increase
from $45.8m recorded in Q2 2017. Average
deal value for acquisitions also increased, from
$11.4m in Q2 2017 to $48.2m in Q2 2018
$1.8bn recorded in total investment deal
value in Q2 2018. This is a decrease from
$2.3bn in Q2 2017. Average deal value reached
$36.9m in Q2 2018, a decrease from $70.0m in
Q2 2017
47 deals recorded in the Transactions Sector,
making this the highest activity out of all
sectors
43 investments were made in the
Transactions sector, which some saw leading
taxi-hailing app Grab receive $1bn from
Toyota, and Xueling Li and YY.com lead a
$272m round in to China’s largest video-
streaming app bigo.tv
 South East Asia sector overview

Sector Q2 2017 total deal value ($m) Q2 2018 total deal value ($m)

Transactions 1,295.8 1,420.1

Hardware & Infrastructure 32.1 412.2

Media 0.0 277.0

Software & Services 464.1 128.3

Marketing 12.0 30.5

Ecommerce 0.0 16.0

Games 551.2 1.8

Mobile & Apps 1.5 0.0

Note: all amounts in USD

 South East Asia – top ten deals
Company Buyer/investor Deal type Sector Value ($m)

Investment Transactions 1,000.0

Hardware &
Acquisition 303.0
Infrastructure

Investment Media 272.0

Consortium Investment Transactions 85.0

Acquisition Transactions 61.0

Consortium Investment Transactions 60.0

Hardware &
Kamet Capital Partners Investment 60.0
Infrastructure

Consortium Investment Transactions 54.0

Consortium Investment Software & Services 38.0

Hardware &
Consortium Investment 30.0
Infrastructure

Note: all amounts in USD

Investments – sector overview
Number of investments by sector

4% 1%1%
5% Transactions = 43
Software & Services = 11
7%
Marketing = 7
Hardware & Infrastructure = 5
9% Ecommerce = 4
Media = 3
58%
Games = 1
Mobile & Apps = 1
15%

§ South East Asia saw a 79% increase in the number of investments between Q2 2017 and Q2 2018
Acquisitions – sector overview

Number of acquisitions by sector

20% Software & Services = 3

Transactions = 3
30%
Hardware & Infrastructure = 2
Media = 2
Ecommerce = 0
Marketing = 0
20% Mobile & Apps = 0
Games = 0

30%

§ Total number of acquisitions in South East Asia decreased by 63% from Q2 2017 to Q2 2018, from 27 transactions
down to 10
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