brightcom group

74
7
Hel: +91 (40) 67449910 EEAX +91 (22) 66459677

May 13, 2020.

The BSE Limited The National Stock Exchange of India Ltd.

P. J. Towers, 25th Floor, Exchange Plaza, Bandra Kurla Complex,
Dalal Street, MUMBAI – 400001. Bandra (E), Mumbai-400051.
Scrip Code: 532368 Symbol: BCG

Dear Madam/Sir,

Sub: Investor Presentation

With reference to the subject cited above, we are enclosing herewith a copy of presentation of the
Company’s US Dollar based financial overview.

The same is also being made available on the website of the Company at
www.brightcomgroup.com.

This is for your information only.

Thanking you.

Yours faithfully,

for BRIGHTCOM GROUP LIMITED

M. SURESH KUMAR REDDY

CHAIRMAN & MANAGING DIRECTOR
DIN: 00140515

brightcom group limited (Formerly Lycos Internet Limited) =

FLOOR: 5, FAIRFIELD BY MARRIOTT, ROAD NO: 2, NANAKRAMGUDA, GACHIBOWLI, HYDERABAD - 500032, TELANGANA, INDIA.
EMAIL: [email protected] =WEB:WWW.BRIGHTCOMGROUP.COM CIN: L64203761999PLC030996
COMPANY OVERVIEW
 Certain Statements in this release reflecting our future growth prospects are forward – looking statements which
involve a number of risks and uncertainties that could cause result to di!er materially from those in such forwarding
looking statements. The risks and uncertainties relating to these statements include but are not limited to risks and
Disclaimer uncertainties with respect to fluctuation in earnings, our ability to manage growth, intense competition in online
advertising including these factors which may a!ect our cost advantage, cost of resources and introduction of
regulations that might impact the prospects, our ability to successfully complete the planned projects, general
economic conditions a!ecting our industry. The company does not undertake to update any forward looking
statements that may be made from time to time by or on behalf of the company.
 Brightcom Group is a leading global provider of comprehensive online or digital marketing services to: direct
marketers, brand advertisers, and marketing agencies. We o!er them access to the billions of Internet consumers that
visit our network of name brand publishers spread across the world. The Company is divided into three major divisions:
(i) media (Ad-Tech and digital marketing), (ii) software services, and (iii) future technologies. The Company’s primary
clients are end advertisers, agencies and publishers, but also include ad exchanges & networks.

The Company has fourteen operating technology companies which provide services that harness the complexity,

Company Overview
interactivity and dynamic nature of the internet with the objective of delivering technology solutions and the most
successful advertising campaigns for its clients. The Company achieves this by selling targeted and measurable online
advertising campaigns and programs for advertisers and advertising agency clients, generating client leads, online
sales and increased brand recognition on their behalf with online consumers. The Company’s digital marketing services
involve marketing through various methods, including: (i) video ads, (ii) display ads, (iii) search marketing, (iv) email
marketing, (v) lead generation, (vi) a"liate marketing, (vii) social media marketing, and (viii) mobile marketing. The
Company has 22 o"ce locations and has 463 employees and consultants worldwide. Brightcom Group ranks at 442
among Fortune 500 India companies.
 • The founders, Suresh Reddy and Vijay Kancharla started USA Greetings in 1998 and renamed the business to Ybrant
technologies in 2000. Over the period of next twenty years, the Company became a global player in digital marketing
and related platforms by successfully acquiring and integrating 10 acquisitions.

• Lycos Inc., formed in 1995, was spun out of Carnegie Mellon University and was a pioneer in internet search. It led the
fastest IPO from inception to listing on NASDAQ in 1996. Lycos was acquired by Terra Networks for $12.5 billion in
2000. Lycos was later sold to Daum Communications for $95 million in 2004.

• Lycos was acquired by Ybrant in 2010 for $36 million and renamed the Company to Lycos Interned Limited.

• In 2016, the Company launched, LYCOS LIFE, Brightcom programmatic video platform and Apollo LYCOS JV.

• The Company ranked #4 in global ranking Video Seller Trust Index for programmatic advertising by Pixelate Inc.
Brightcom was chosen as a Top Alternative Ad Network in MonetizeMore's 2016 roundup. In addition, the Company

Historical Overview launched Compass to combine programmatic video and display advertising into yield optimization & ad management
platform. The Compass platform was nominated as finalist for Best Ad Tech Tool at Cynopsis Model D Awards 2016.
LYCOS Life band featured in ’10 best fitness bands in India - 2016’ by IOTIndiaMag.com.

• In 2017, the Company topped Pixelate's Video Trust Index (International) as per March 2017 report. The Company
launched post-bid.com landing page geared to potential demand side partners. The Company relocated to a large
new space in Gachibowli, Hyderabad. In addition, LYCOS Media introduced LYCOS Sports app. The Company launched
Israeli Ad-Tech Map and signed an agreement with Tinbu.com to expand its news content o!erings in the areas of:
Lottery, Horoscopes, Celebrity News, Sports, Gas Prices, Weather, Comics, and Today in History. The Company was
ranked #345 in Business World Real 500 List.

• In 2018, Lycos Internet Limited was renamed to Brightcom Group Limited. The Company was ready with changes
required to the European General Data Protection Regulation (“GDPR”).

• The Company increased its service o!erings in Artificial Intelligence and Machine Learning.

• Brightcom Group was featured among Fortune India 500 for the year 2019
 Company Timeline
LYCOS Gets Listed on the National
Stock Exchange of India.
Acquired MediosOne in US for $4.5 Announces Lycos Life Division.
million, thereby entering into front end Raises $18 million from Oak India and
Expanded o!erings in
digital marketing space. Batterymarch. Acquired LYCOS from Daum
Artificial Intelligence and
Communications for $36 million.
Machine Learning.
In 1998, the founders, Suresh Reddy and
Vijay Kancharia, formed USA Greetings Ybrant Digital and LGS Global
Acquired Online Media Solutions in
in USA and renamed it Ybrant propose to merge.
Israel for $13 million giving a foothold
Technologies in 2000.
in European digital markets. Acquire stake in Web 3.0. Tops Pixelate's Video Trust
Index (International). Launched
Facebook chooses Ybrant
Israeli Ad-Tech Map Ranked
Acquired email marketing Digital as an o"cial marketing
#345 in Business World Real
platform, VoloMP for $2.25 API partner.
500 List.
million.

1998-
2004 2005 2006 2007 2008 2009 2010 2011 2014 2015 2016 2017 2018 2019 2020
2000

Changed name to Lycos Internet Lycos Internet Limited

Limited. Changed to Brightcom
Group Limited.
Raised $ 30 million from a few Agrees to acquire minority stake in
private equity firms. Jobookit Holdings Ltd. Featured among Fortune
Acquired AdDynamix in US for $10 Lycos TV adds Cool New Content to its India 500 for the year 2019
million. Entertainment Channel.

Raised $20 million from Everest Capital. Brightcom. Apollo Lycos JV and LIFE fitness band launched. Ranked #4
in Video Seller Trust Index.
Acquired Dream ad based in Argentina for
Changed name to Ybrant Digital and $11.5 million. Chosen as Top Alternative Ad Network in MonetizeMore's 2016 roundup.
started o!ering tools and services to
Acquired Max Interactive based in Australia Compass platform nominated as finalist for Best Ad Tech Tool at
digital ad networks.
for $8.3 million. Cynopsis Model D Awards 2016.

LYCOS Life band features in ’10 best fitness bands in India - 2016’.
Company Structure

Brightcom Group
Limited
(India)

100% Ownership 100% Ownership 100% Ownership 100% Ownership 100% Ownership 100% Ownership 100% Ownership 100% Ownership

International Ybrant Media Dyomo Max Interactive Online Media Yreach Media LIL Projects
Frontier Data
Expressions Inc. Acquisition Inc. Corporation Pty Ltd. Solutions Limited Pvt Ltd, Private Limited
Management Inc.
(USA) (USA) (USA) (Australia) (Israel) (India) (India)
(USA)

90% Ownership 100% Ownership

DreamAD Group Ybrant Digital

of Services De
10% Ownership
Companies Publiciade Ltd.
(Brazil)

DreamAD, SA DreamAD, SA
(Argentina) (Chile)

DreamAD, SA DreamAD, SA
(Panama) (Uruguay)
 The Company’s services can be categorized into three primary divisions: (i) Ad-Tech (digital/ advertising), (ii) software
Services Overview development services / IT services, and (iii) future technologies. The Company’s software development services are
based in India, while all other subsidiaries provide digital/ advertising services. The Ad-Tech and software development
services divisions had revenues of $308.0 million and $73.0 million, respectively, representing 80.8% and 19.2%,
respectively of FY2019 revenue. The Company’s future technologies division consists primarily of the Company’s LIFE
product and developments in artificial intelligence, machine learning and Digital Out of Home (“DOOH”) advertising.

SERVICES BREAKDOWN BY DIVISION

FY2019 Revenue : $308 Million FY2019 Revenue : $73 Million FY2019 Revenue : N M

Digital Advertising Software Future Technologies

Online Media LIL Projects India Ltd. LIL Projects India Ltd.
Dyomo Corporation
Solutions Limited (Software) (Software)

Brightcom Group Brightcom Group Brightcom Group

Dream AD, SA
India (Digital) India (Software) India (Software)

International Max Interactive Pty

YReach Media YReach Media
Expression Inc. Ltd.

Frontier Data
Yreach Media Pvt Ltd.
Management Inc.

Ybrant Digital Brazil

 The Company’s services provide advertisers and online publishers with a combination of campaigns, networks, and
technologies to engage consumers and maximize their digital marketing reach.

The following provides a summary of Company’s services:

Video Advertising: The Company o!ers video advertising services to advertisers, agencies and DSPs through a
programmatic solution called Brightcom. The Company o!ers the programmatic video advertising solution through its
brands: Oridian, DreamAd and Max Interactive

Display Ads Marketing: The Company o!ers display ads marketing with geographic, demographic, and behavioral
targeting through its technology platform, Ad Management System (“AMS”), which tracks and aggregates consumer
response to advertisements, allowing the users to adjust targeting if needed. The Company provides tools; such as flash
streaming and small applications called “applets,” for generating display ads. The Company o!ers display ads
marketing through its brands: MediosOne, AdDynamix, Oridian, DreamAd and Max Interactive.

Performance-based Marketing: The Company o!ers performance-based marketing to clients that use AMS, a"liate
marketing and display marketing, with pricing determined by one or more of the following methods: (i) cost-per-lead

Digital Advertising (“CPL”), (ii) cost-per-thousand (“CPM”), (iii) cost-per-click (“CPC”), and (iv) cost-per action (“CPA”).

Definitions: (i) CPL - charges with a rate determined by each impression, which is a delivery of the advertisement to the
consumer, (ii) CPM - charges with a rate determined by every one thousand impressions, (iii) CPC - charges with a rate
determined by each instance of a consumer “clicking” on the advertisement, and (iv) CPA - charges with a rate
determined by each instance of a consumer performing a specified action, typically completing a form or purchasing a
product.

Search Marketing: The Company o!ers three primary methods of search marketing: (i) contextual search, (ii) paid
inclusion, and (iii) site optimization.

Definitions: (i) contextual search - an advertiser pays to have text links appear in an article based on the article’s content
instead of the consumer’s search term, (ii) paid inclusion - an advertiser pays to guarantee its website is indexed by a
search engine, and (iii) site optimization - an advertiser pays to ensure its website appears in search engines more often
and with better placement.

Email Marketing and Lead Generation: The Company provides an email marketing platform and relevant technology
by license through brand, VoloMP, which is a scalable bulk emailing platform capable of sending up to 20,000,000
emails on one server per day with tracking and reporting statistics. The Company also provides clients with three other
technology platforms for email marketing, Zentyl, FlatMonk and DataCombine. The Company provides lead generation
through its brands Oridian and AdDynamix.
A!liate Marketing: The Company o!ers a"liate marketing where in a publisher joins an advertiser’s a"liate marketing
program and agrees to distribute the advertiser’s advertisements in exchange for commissions on leads or sales generated.
One form of a"liate marketing is co-registration, which involves an arrangement between an advertiser and an a"liate for
opt-in tra"c, typically taking the form of a checkbox for registrants to opt-in to receive future email announcements from the
advertiser. Co-registration is a particularly e!ective way for advertisers to generate business because consumers choose to
receive advertising. The Company uses a"liate management software to track high volumes of impressions, clicks or other
specified actions that could come from di!erent publishing sources, including websites, emails, search engines, and
newsletters.

Social Marketing: The Company o!ers social marketing through popular sites, such as Facebook, Twitter, or website review
sections, to create content that attracts attention, whether through online conversations, reviews or other participation from
consumers. The consumers then spread the advertiser’s message to other consumers, with the message resonating because
it comes from another consumer, who is presumably impartial and has tried the product or service, instead of the advertiser.

Mobile Marketing: The Company o!ers mobile marketing to advertisers that enable brands to provide location specific
advertising to consumers on their mobile devices by using location-tracking technology. Advertisers currently implement
mobile marketing through voice, internet, and SMS, and are looking at marketing through other value-added services in the
near future. The advertisements used in mobile marketing include discount coupons and advertisements that can expire
quickly because of the consumer’s proximity to the service or product.

Niche Campaigns: The Company uses various marketing techniques to develop niche campaigns for clients, including
campaigns that target consumers by geography, demography or behavior (also known as predictive or psychographic
targeting), allowing clients to overlay multiple variables, such as finding customers who speak a certain language, gender and
browsing history. The Company’s niche campaigns tailor its clients’ advertisements in addition to its target consumers.

Campaign Analysis and Optimization: Throughout running client campaigns, the Company provides data to its clients in
online, real-time performance reports that evaluate campaigns along several dimensions, including sales, leads, registrations,
and downloads. The Company’s strategists review the data with its clients to tailor their campaigns as needed. For example, if
a website carrying an advertisement is generating unacceptably low response rates, the Company can remove that website
from the campaign or negotiate a lower rate.
Digital Tra!c Management: The Company o!ers digital tra"c management that involves evaluating the client’s objectives,
outlining media strategy, developing a media plan and executing the plan by negotiating rates for the desired placements.

Ad Serving: The Company remotely stores and delivers digital advertisements to website visitors. In addition, the Company
coordinates and monitors the ad serving process once an advertising campaign commences. The Company’s ad serving
systems receive several billion advertisement requests each month, processing the majority of these at sub-millisecond
speeds. The Company’s ad serving system allows clients to adjust their advertising campaigns quickly because it makes the
changes on its own ad serving systems and not individual websites.
 Record-Keeping for Client Interaction: The Company collects and stores all information generated in client interactions
in a data warehouse, which allows users to review and structure campaigns to improve e!ectiveness of services. The
Company reviews all product and service inquiries and orders at both a business and technical level to ensure that
requirements are properly understood and to provide the right personnel to serve clients.

Real Time Reporting: The Company generates real time reporting to ensure that its clients can receive information as
fast as it is generated. Real time reporting allows the Company to tailor campaigns for its clients with flexibility and
e"ciency.

Client Responsiveness: The Company engineers its services with failsafe controls and monitors services 24 hours a day
and 365 days a year with specialized monitoring systems that can aggregate issues and relay them to a human-sta!ed
network operations center. The Company constantly have engineers available on standby to take corrective action as
needed.

Software Services & The Company’s software services include developing customized technology platforms to solve specific needs of clients
primarily around digital media and other related o!erings. The Company’s software services generated revenue of
Future Technologies $70.3 million in FY2018 and is expected to increase to $73 million in FY2019. The Company integrates open source and
commercially available software to ensure optimum cost-sensitivity. The Company charges its clients for technology
platform customization through various means: (i) licensing, (ii) the costs incurred in development method, or (iii) pay
per use. The Company uses a standardized development process that includes: (i) planning, (ii) designing inputs, (iii)
business critical outputs, (iv) quality assurance, (v) change control, and (vi) knowledge sharing.

Artificial Intelligence & Machine Learning: The Company has deep connections with PhD’s at universities and along
with industry experts provides artificial intelligence and machine learning services to its customers. The Company has
completed millions of data annotations as well as complex synthetic data-sets with custom API's for fast growing start-
ups and Fortune 1,000 companies in the field of retail, agriculture, medicine, security, and industry 4.0. The Company
has quickly scaled to be the premier provider of synthetic data, data annotation and end product development for
small to mid-size businesses and enterprises alike. Through the utilization of its vast annotated data resources, along
with machine learning and artificial intelligence services, the Company is uniquely positioned to create groundbreaking
applications at an unparalleled speed, a!ordability, with higher accuracy and precision.
 Through its various subsidiaries, the Company owns the following products:
Products & Brands Onetag: generates a tag by the One Tag system which is implemented on the publisher’s website or ad-server to
trigger the banner display from the Company’s system every time an impression is called. It is one of the most e"cient
seller side tracking platforms.

COREG: COREG or Co-Registration allows a consumer to opt-in for multiple o!ers while registering for one primary
o!er. For example, while signing up for a newsletter, a consumer might see a checkbox with a sign up for a related
newsletter from another company. This checkbox is the opt-in for the co-registration, by checking that box, the
consumer’s data will be transferred to advertisers presented on the form.

VoloMP: is an email marketing tool used by a"liate marketers with functionality for setting sending limits with an inbuilt
Unique tracking algorithm.

ProxyTool: is a Firefox installable tool bar with user authentication and admin functions

Brightcom: is a platform that allows the programmatic trading of ads, primarily video based. It allows for easy
integration and maximum yield over video and display, both mobile and desktop. It provides a visual analytics interface
and also quality and Ad fraud monitoring mechanism.

Pangea: is a proprietary optimization approach which enables quality conversions with full users funnel tracking to
achieve optimum results.

SERVICES BREAKDOWN BY DIVISION

Subsidiary Brands used by Subsidiary Products used by Subsidiary

Online Media Solutions Oridian Onetag, Pangea, Brightcom

Dyomo

DreamAD DreamAD Onetag, Pangea

International Expressions, Inc VoloMP

Frontier Data Management MediosOne Onetag. Pangea, COREG, ProxyTool

Inc.
Max Interactive Pty Ltd. Max Interactive Onetag, Pangea

Ybrant Brazil Onetag, Pangea

 • The complexity of the Company’s products and the know-how incorporated into them make it di"cult to copy or
replicate specific features. The Company relies on a combination of confidentiality clauses, copyrights and, to a
lesser extent, patents, and trademarks to protect its intellectual property and know-how.

• The Company customarily requires employees, clients and third-party collaborators to execute confidentiality
agreements or otherwise agree to keep its proprietary information confidential. The Company’s employment
contracts typically include clauses requiring employees to assign to the Company, all inventions, and intellectual
property rights that they develop in the course of their employment and to agree not to disclose confidential

Intellectual Property information. Because software is stored electronically and thus highly portable, the Company has strict identity
access requirements to access servers through the use of closed networks and with physical security systems which
prevent their external access. The Company minimizes disclosure of source code to clients and other third parties. As
next generation products are developed, the Company intends to pursue patent and other intellectual property rights
protection, when practical, for core technologies developed in the Company.

• The digital marketing industry is characterized by ongoing product changes resulting from new technological
developments, performance improvements and decreasing costs. The Company believes that its future growth
depends to a large extent on its ability to profoundly understand clients and their needs and to be an innovator in the
development and application of technology.
Customer Overview The Company’s customers include Ad agencies, publishers, and direct advertisers that depend on the Company’s
products to deliver a comprehensive marketing experience to their clients. The following table provides a snapshot of
few of the Company’s customers:

CUSTOMER LOGOS
Customer Concentration The Company has a diversified base of customers where the top 10 customers within each subsidiary represent less
than 45% of revenue from respective subsidiary, with an exception of LIL Projects Pvt Ltd where 100% of revenues are
generated from Top 10 customers:

CUSTOMER CONCENTRATION (FY2019)

120%
Top 10 Customer Concentration

100%
100%

80%

60%

44.7%
39.3%
40% 35.4% 35.7% 35.3% 33.7% 34.6%

20%

0%
OMS DreamAD Ybrant Max FDM IE Dyomo LIL
(Israel) (Latin Digital Interactive (USA) (USA) (USA) Projects
America) Services Pty Ltd Pvt Ltd
(Brazil) (Australia) (India)
Roadmap The Company has stayed at the forefront of its sectors by continuing to invest in new technology and expand through
select acquisitions. The Company has a deep understanding of digital advertising trends, software and solid track
record in acquiring and integrating niche technology companies to further its technical lead among its competitors and
expand into up and coming high growth sub-sectors. Over the next 18-24 months the Company plans to expand or
invest in the following technologies and sectors:

Roadmap over next 18-24 months

Artificial Intelligence:
The Company will continue to invest in
machine learning, heuristic tools and Internet of Things: Digital Out of Home (DOOH) :
AI systems for programmatic ad
The Company’s Lycos LIFE division is The Company’s focus on Digital Out of Home or DOOH
buying for our customers to use and
implement. focused on simplifying the way people refers to digital media used for marketing purposes
leverage the Internet for their daily outside of the home and allows advertisers to change
Beyond digital marketing or use, through various connected their messaging according to variables such as time,
agriculture or even health care, devices. date, weather and sports results and others.
opportunity exists in every industry
and part of society. AI allows us to
understand and make sense of the
world around us in a deeper way than
ever before.
AI is already helping the world with
crisis response and prevention, with Mobility:
more precise flood warnings and Video Ads: The Company is building significant tools and systems
rainfall forecasting, and predicting The Company has built technologies to better serve customers with the greater user
earthquake aftershocks. and systems around video ads – information available from mobile users including
World has not even scratched the provide smarter targeting of relevant location, preferences, and one-on-one marketing
surface of what AI can do. Brightcom ads in both mobile apps and online opportunities versus online platforms where often a
Group is closely monitoring the videos. family may be using the same computer and hence
developments and intends to demographic mix-ups are more likely.
contribute where appropriate.
 The Company has one pending litigation outstanding in the matter Daum Global Holdings Corp. v. Ybrant Digital
Legal Matters Limited et al. The dispute between the parties arose out of a certain stock purchase agreement dated as of August 15,
2010 (“SPA”) between Daum and Ybrant Media Acquisition, Inc (or “YMA”). In the SPA, YMA agreed to purchase from
Daum Communications for certain payments all the shares of Lycos Inc., a Virginia corporation with the principal o"ce
in Massachusetts.

( A mutually agreed upon settlement contract to address the dispute has been drafted and the logistics of closing are
underway.)

Equity Capitalization

Name Number Of Shares % Ownership

Total Promoter Holding 186427685 39.1%

Public 255309611 53.6%

Foreign Venture Capital Investors 33368913 7.0%

Foreign Portfolio Investor 1145290 0.2%

Total Public Holding 289823814 60.9%

Grand Total 476251499 100.0%

FINANCIALS
Income Statements (FY2015-FY2019)
(Amounts in Thousands, Years ended March 31)

Operating Information FY2015 FY2016 FY2017 FY2018 FY2019

Digital/Advertising Revenue $244,293 $277,587 $297,503 $305,643 $305,060

Software Revenue $75,730 $66,744 $67,940 $70,293 $64,126

Other Revenue $2,317 $747 $102 ($58) ($387)

Revenue $322,341 $345,077 $365,546 $375,875 $368,799

Growth Rate NA 0.07% 5.9% 2.8% (1.9%)

Digital/ Advertising COGS $98,520 $128,388 $140,160 $137,746 $133,486

Gross Profit $223,820 $216,689 $225,386 $238,129 $235,313

Gross Margin % of Digital Revenue 59.7% 53.7% 52.9% 53.9% 56.3%

SG&A $127,115 $112,847 $116,140 $127,594 $126,851

Depreciation and Ammortization $7,383 $10,232 $15,058 $17,615 $19,969

EBIT $89,322 $93,610 $94,188 $92,920 $88,493

Ammortization 0 0 0 0 0

EBITA $89,322 $93,610 $94,188 $92,920 $88,493

Depreciation $7,383 $10,232 $15,058 $17,616 $19,969

EBITDA $96,705 $103,842 $109,246 $110,535 $108,462

EBITDA Margin 30% 30.1% 29.9% 29.4% 29.4%

EBITDA Growth NA 7.4% 5.2% 1.2% (1.8%)

Adjustments 0 0 0 0 0

Adjusted EBITDA $96,705 $103,842 $109,246 $110,535 $108,462

Adj. EBITDA Margin 30% 30.1% 29.9% 29.4% 29.4%

Adj. EBITDA Growth NA 7.4% 5.2% 1.2% (1.8%)

Interest Expense $3,683 $2,428 $2,275 $2,294 $1,887

Other Expense/ (Income) $0 $0 $0 $0 $0

Pretax Income $85,683 $91,182 $91,913 $90,626 $86,606

Income Taxes $28,722 $29,182 $29,267 $28,223 $23,490

Tax Rate 33.5% 32.3% 31.8% 31.1% 27.1%

Net Income $56,917 $61,772 $62,646 $62,403 $63,115

Net Income Margin 17.7% 17.9% 17.1% 16.6% 17.1%

Notes:
The Company’s financials are in Indian Rupees and have been converted to USD for presentation above.
Balance Sheets (FY2015-FY2019)
(Amounts in Thousands, Years ended March 31)

ASSETS FY2015 FY2016 FY2017 FY2018 FY2019

Cash $9,042 $894 $12,412 $13,744 $14,938

Accounts Receivable $136,376 $110,238 $199,734 $134,359 $128,636

Short Term Loans & Advances $48,104 $81,110 $87,592 $91,662 $98,891

Other Current Assets $27,490 $67,627 $73,736 $84,250 $78,152

Total Current Assets $220,912 $267,939 $293,474 $324,015 $320,517

PP&E $2,737 $3,664 $2,321 $4,515 $3,515

Intangible Assets(Including Goodwill) $50,350 $85,831 $95,086 $91,058 $72,861

Capital Work-in-Progress $16,754 $3,387 $2,838 $19,217 $21,365

Intangible Assets Under Development $26,342 $6,975 $11,018 $27,107 $19,782

Non-Current Investements $868 $868 $16,316 $16,316 $32,595

Long Term Loans & Advances $27,350 $25,034 $25,816 $25,860 $25,860

Deferred Financing Fees $0 $0 $0 $0 $0

Other Non-Current Assets $6,810 $4,312 $4,429 $4,440 $4,344

Total Assets $352,123 $398,010 $451,298 $512,529 $500,839

LIABILITIES & STOCKHOLDERS’ EQUITY

Accounts Payable $28,140 $13,528 $12,976 $11,818 $12,303

Short Term Provisions $16,917 $9,502 $11,177 $11,538 $10,343

Other Current Liabilities $12,446 $22,301 $15,191 $15,517 $15,685

Total Current Liabilities $57,504 $45,330 $39,344 $38,873 $38,331

Existing Borrowings $12,306 $10,299 $10,535 $10,503 $9,690

Lycos Acquisition Payable $16,000 $16,000 $16,000 $16,000 $16,000

Total Long-Term Debt $28,306 $26,299 $26,535 $26,503 $25,690

Long Term Provisions $755 $667 $267 $597 $1,298

Deferred Tax Liabalities $1,064 $1,018 ($63) ($210) $423

Other Long Term Liabilities $712 $712 $1,235 $712 $840

Total Liabilities $88,340 $74,026 $67,318 $66,475 $2,561

Stockholders Equity $263,783 $323,983 $383,980 $446,054 $434,257

Total Liabilities and Stockholders Equity $352,123 $398,010 $451,298 $512,529 $500,839

Notes:
1. The Lycos Acquisition Payable is the remaining amount due on Lycos acquisition.
2. The Company’s financials are in Indian Rupees and have been converted to USD for presentation above.
Cash Flow Statements (FY2018 – FY2019)
(Amounts in Thousands, Years ended March 31)

Sources: Operations FY2018 FY2019

Net Income $62,403 $63,115

Depreciation $17,615 $19,969

Ammortization $0 $0

Total Sources: Operations $80,018 $83,084

Uses: Operations

Change in Working Capital ($29,679) ($21,097)

Other Changes ($394) $0

Total Uses: Operations ($30,074) ($21,097)

Cash flow from Operations $49,945 $62,686

Capital Expenditure (Cash) ($48,250) ($59,279)

Free Cash Flow $1,694 $2,708

Payment of Existing Borrowings ($32) ($813)

Other Changes in Equity ($330) ($701)

Closing Costs $0 $0

Total Anticipated Debt/Equity Issue ($362) ($1,514)

Total change in cash $1,333 $1,194

Beginning Cash Balance $12,412 $13,744

Increase/(Decrease) in Cash $1,333 $1,194

Cash Balance $13,744 $14,938

Notes:
1. The Company’s financials are in Indian Rupees and have been converted to USD for presentation above.
Revenue Growth Analysis The Company’s FY2019 revenue is $368.8 million, which represents a 1.9% decrease over the FY2018 revenue of $375.9
million. This decrease in revenue is primarily coming from decrease in YMA revenue of $13.6 million countered by
increase in OMS contributing $6.1 million, followed by Dream Ad Group increase at $3.2 million. The YMA Consolidated
subsidiary which holds the LYCOS brand, has been handed back to Duam Communications in a court receivership,
pending a final acquisition payment. It should kept in mind that the consolidated revenue only decreased marginally
even after removal of the revenue from an entire subsidiary.

REVENUE BRIDGE (FY2018 – FY2019)

(Amounts in Millions of USD, Years ended March 31)

$395

$1.5
$1.2
$386 $0.8
$3.2

$13.6
$6.1

$377
$0.2 $0.5

$7

$368
387.2

386

385.2

382

$375.9 375.9

375.1 375.1
375.3

$369
$359
368.8

$350
FY2018 Online Media DreamAD Ybrant Brazil Max Frontier Data YMA Consol International Dyomo Brightcom FY2019
Revenue Solutions Group Interactive Management (FDM) (Lycos) Expressions Corporation India Revenue
(OMS) (Digital+SW)
 The Company’s FY2019 revenue of $368.8 million decreased by 1.9% from $375.9 million in FY2018. Revenue from OMS
contributed 36.6% followed by DreamAD group at 15.2% to FY2019 revenue. The following tables show the revenue
contribution from each subsidiary and their EBIDTA margins..

REVENUE CONTRIBUTION AND EBITDA MARGIN BY SUBSIDIARY

(Years ended March 31)

Revenue Contribution (FY2019): Revenue Contribution EBITDA Margin

60%

50.7% 51.2%

50% 45.3%

39.7%
40%
31.5%
29.7% 29.9%
30%

20.1%
20%

10.6%
10%
2.4% 2.7% 4.3%
36.6% 15.2% 7.2% 21%
0%
Online Media DreamAD Max Frontier Data Interntational Dyomo Brightcom
Ybrant Brazil
Solutions Group Interactive Management Expressions Corporation India
(OMS) (FDM)

Revenue Breakdown by Subsidiary:

FY2018 FY2019

Brightcom India
21.0%

Brightcom India
18.8%

OMS OMS
Dyomo Corporation
36.0% 36.6%
7.0% Dyomo Corporation
7.2%
YMA Consol (Lycos)
IE
3.6%
4.2% IE
4.3% Ybrant Brazil
Ybrant Brazil 2.4%
2.4%
FDM
Dream Ad Group 10.6%
FDM
14.9% Dream Ad Group
10.4%
Max Interactive 15.2%
2.7%
Max Interactive
2.7%
Gross Margin Analysis Given that the Company is in business of buying and selling digital advertising media, the COGS are primarily the costs
of media purchased for advertising inventory. Media tra"c quality is continuously improving as better filters are in
place and higher quality media tra"c has higher costs and higher returns for advertisers. The Company’s Digital/
Advertising gross margin was 53.9% in FY2018 and has increased to 56.3% in FY2019 indicating significant improvement
in delivery e"ciencies.

GROSS PROFIT AND MARGIN (FY2015-FY2019)

(Amounts in Thousands, Years ended March 31)

$400,000 60%
59.7%

56.3%

53.9%
$300,000 53.7%
52.9%

$238,129 $235,313
$223,820 $225,386
$216,689

$200,000

$145,773 $167,897
$157,343 $171,574
$149,199

$100,000

$78,047 $70,232
$67,490 $68,043 $63,739

$0 30%
FY2015 FY2016 FY2017 FY2018 FY2019

Gross Profit (Software) Gross Profit (Digital) Gross Profit Gross Margin % of Digital Revenue
SG&A Analysis
The Company’s SG&A expenses consist of: (i) personnel expenses, (ii) sales and marketing expenses, and (iii)
administration expenses. SG&A percentage of revenue has shown marginal increase from FY2018 to FY2019 of 0.5% .The
Company has been focused on building a tech platform to address this and to help control personnel costs in future.

SG&A EXPENSES, % OF REVENUE (FY2015-FY2019)

(Amounts in Thousands, Years ended March 31)

$130,000 40%
39.4%

33.9% 34.4%
$125,000 32.7%
31.7%

$120,000

$115,000

$127,115 $112,847 $116,140 $127,594 $126,851

$110,000 0%
FY2015 FY2016 FY2017 FY2018 FY2019

Total SG&A % of Revenue

SG&A Expenses Breakdown (FY2018) SG&A Expenses Breakdown (FY2019)

Admin
Admin Other
14.78%
16.54% 3.14%

Sales & Marketing Sales & Marketing

8.96% 8.56%

Personnel Personnel
74.51% 73.52%
EBITDA Analysis The Company’s FY2018 EBITDA of $110.5 million decreased marginally by 1.9% in FY2019 to $108.5 million. The EBITDA
margin remained same at 29.4% between FY2018 and FY2019. The lower chart shows historic EBITDA levels and margin
trend line.

EBITDA BRIDGE AND MARGINS(FY2015-FY2019)

(Amounts in Thousands, Years ended March 31)

EBITDA Bridge (FY2018-FY2019)

$140,000

$7,076 $743
$4,260

$110,535 1,03,459 1,03,459

1,07,719

$108,462

$370
FY2018 EBITDA Revenue COGS SG&A FY2019 EBITDA

EBITDA and Margin (FY2015-FY2019)

$120,000 35%

30% 30.1% 29.9% 29.4% 29.4%

$112,500

$105,000

$97,500

$96,705 $103,842 $109,246 $110,535 $108,462

$90,000 0%
FY2015 FY2016 FY2017 FY2018 FY2019

EBITDA Margin %
 Net Working The Company’s net working capital is decreased by $4.1 million in FY2019, primarily due to decrease in Accounts
Receivables by $5.725 million, decrease in other assets by $6.1 million and increase in short term advances by $7.2
Capital Analysis million . The short term loans and advances are prepayments made to publishers for buying media inventory in
advance.

NET WORKING CAPITAL (FY2015-FY2019)

(Amounts in Thousands, Years ended March 31)

Change in Net Working Capital (FY2018-FY2019)

$10,000
20000

7,229

($5,725) ($6,098) ($1,195)

0
485 168

10000

$7,229
1,195

$485 $168
5,725
6,098

10,000 10,000 10,000

8,805

4,275

3,906

($10,000) 0

Changes in Accounts Changes in Short Term Changes in Other Changes in Accounts Changes in Short Term Changes in Other Current
Receivable Loans & Advances Current Assets Payable Provisions Liabilities

Net Working Capital (FY2015 – FY2019)

$500,000

$400,000
$361,062

$310,271 $305,633
$300,000
$258,975

$211,970
$200,000 $321,718
$271,398 $267,348
$213,644
$154,467

$100,000

$57,503 $45,331 $39,344 $38,873 $38,331

$0
FY2015 FY2016 FY2017 FY2018 FY2019

Current Liabilities - Current Debt Net Working Capital Current Assets - Cash
REVENUE DRIVERS
Revenue Growth Analysis
ONLINE MEDIA SOLUTIONS (OMS) DREAM AD GROUP
250 70 250 30
CAGR : 17.1% CAGR : 19.9 % 219
REVENUE CONTRIBUTION : 37% 203 203 60 REVENUE CONTRIBUTION : 15% 208
196
200 189 200
171 50 169
20
150 150
133 40

Millions

Millions
35 127
33 34
14
31 13
100 30 100 12
100 24 100 11
10
19 8
20 7
50 50
8 8 9
6 7 10 3 3 3 3
4 2 2
2 2 2 1 1 1 1
1 1 1 0 0
0 0 0 0
2014A 2015A 2016A 2017A 2018A 2019A 2014A 2015A 2016A 2017A 2018A 2019A
Revenue normalised w.r.t 2014 No. of Impressions RON No. of Impressions Premium No of Users - Videos Revenue normalised w.r.t 2014 No. of Impressions RON No. of Impressions Premium No of Users - Videos

FRONTIER DATA MANAGEMENT (FDM) YBRANT BRAZIL

250 12 300 10
CAGR : 16.6 % CAGR : 29.1 % 275

REVENUE CONTRIBUTION : 11% 205

200
REVENUE CONTRIBUTION : 2 %
10 240
200 190 225 225

165
8 175
150 180

Millions
Millions
125 150
6 5
100 5 5
120
100 100
4 4 3
4
3 3 3 3 3
2 2 2
50 2 2 60
2 1 1 1 1 1
1
0 0 0 0 0 0
0 0 0 0 0 0 0
0 0 2014A 2015A 2016A 2017A 2018A 2019A
2014A 2015A 2016A 2017A 2018A 2019A
Revenue normalised w.r.t 2014 No. of Impressions RON No. of Impressions Premium No of Users - Videos
Revenue normalised w.r.t 2014 No. of Impressions RON No. of Impressions Premium No of Users - Videos

YMA CONSOL (LYCOS) MAX INTERACTIVE

200 15 350 10
CAGR : -16.6 % CAGR : 33.3 % 300
REVENUE CONTRIBUTION : 0% REVENUE CONTRIBUTION : 3% 275
160 280
146 250
10
10
120 210
Millions

Millions
100 175
7 5
86
6
80 140 125
5 100 3 3 3
46 49
3 2
40 70
2 2 2
1 1 1 1 1
1 1
0 0 0 0 0 0
0 0 0 0 0 0 0
0 0 0 0
2014A 2015A 2016A 2017A 2018A 2019A 2014A 2015A 2016A 2017A 2018A 2019A
Revenue normalised w.r.t 2014 No. of Impressions RON No. of Impressions Premium No of Users - Videos Revenue normalised w.r.t 2014 No. of Impressions RON No. of Impressions Premium No of Users - Videos

Note: The YMA Consolidated subsidiary holds the Lycos brand, which has been handed over back to Duam Communications pending a final remuneration of $16.0 million
in acquisition payments. For the purposes of the PPM the YMA Consolidated subsidiary has been taken out of financial consideration for FY2019
 INTERNATIONAL EXPRESSIONS DYOMO CORPORATION
250 30 200 188 100
CAGR : 16.7 % CAGR : 14.4 % 180

REVENUE CONTRIBUTION : 4% 200 200 REVENUE CONTRIBUTION : 8% 167

200 188 160 82.4

21 21 140
163 20
20
18 120
150 120 64.8

Millions
125 100
14
100
100 80 47.2
10
10

50 40 25 26 29.6
24
19
16
13
0 0 0 12
2014A 2015A 2016A 2017A 2018A 2019A 2014A 2015A 2016A 2017A 2018A 2019A
Revenue normalised w.r.t 2014 Email Revenue normalised w.r.t 2014 No. of Projects

BRIGHTCOM INDIA (SOFTWARE) BRIGHTCOM INDIA (DIGITAL)

120 70 150 50
CAGR : -0.7 % CAGR : -16 %
REVENUE CONTRIBUTION : 19% REVENUE CONTRIBUTION : 1%
120 40
110
100

90 30
101
100
100 57.5 22
96
54 60 20
52 91
90
90 89
49 30 10
21
48
47 13 13
46 2 2 82 2
4
0
80 45 0 0
2014A 2015A 2016A 2017A 2018A 2019A 2014A 2015A 2016A 2017A 2018A 2019A
Revenue normalised w.r.t 2014 No. of Projects Revenue normalised w.r.t 2014 No. of Projects
MANAGEMENT STRUCTURE
Board of Directors

The Company’s current Board of Directors is listed below:

Name Title Background

Mr. Reddy is the Chairman & CEO of Brightcom Group. With over a decade of online marketing and advertising experience, he has a
strong understanding of building e"ective cross-country and cross-cultural business operations. He directs and supervises the
group's strategy and its implementation globally.
Mr. Reddy founded two successful companies USAGreetings and Ybrant Technologies. He maintains a global network of trusted
relationships with peer entrepreneurs, corporates, partners, institutions and the media. He has consummated, completed and
Suresh Reddy Chairman & Chief Executive O!cer integrated 10 major acquisitions for Ybrant Digital, coupled with fund raising. The group under his leadership has raised $100 million
in equity and debt over a period of 7 years.
Prior to co-founding two successful companies USAGreetings and Ybrant Technologies, he worked in various roles across di"erent
industries in Fortune 500 companies, such as Caterpillar, Chrysler, SBC(PacBell) and Charles Schwab.
Mr. Reddy holds an M. S. in Engineering from the Iowa State University and a B. Tech. in Mechanical Engineering from the Indian
Institute of Technology, Kharagpur, India.

Mr. Kancharla leads the innovations at Brightcom Group. He is responsible for the company's worldwide technology enhancements
and innovations. Mr. Kancharla has been at the forefront of the internet revolution and has vast experience in building innovative
solutions for the online market.
Executive Director & Chief
Vijay Kancharla Prior to co-founding USAGreetings and Ybrant Technologies, he worked with some of the Fortune 500 companies, such as Hewlett
Innovation O!cer
Packard and Pacific Bell.
Mr. Kancharla holds an M. S. in Computer Science from the University of Louisville and a B. Tech. from the Jawaharlal Nehru
Technological University, Hyderabad, India.
Board of Directors (Cont’d)

Mr. Allamsetty, is one of the veteran IT professionals in the country, who co-founded many US-based technology start-ups in India.
Mr. Allamsetty is the co-founder of Platys Communications in India, which is one of the first Fab-less digital high speed ASIC (Chip)
design house in Hyderabad, that was acquired by Adaptec Inc., CA USA.
Mr. Allamsetty is the Founder and Managing Director of Ivana Foods Pvt. Ltd., a Food Processing Technology company with the vision
Mr. Raghunath Allamsetty Non-Executive Director of being the world's first 100% natural, ready to consume, beverages and foods.
Mr. Allamsetty’s past assignments include, Board of Director for LYCOS, formerly (Ybrant Digital Limited) a Digital Marketing
Company listed with the Bombay Stock Exchange and NSE, Vice President – Asia Pacific, for Intrepid Global Security Solutions Inc.,
based out of Miami, USA, Managing Director of Apere India Private Limited, an Identity Management Solutions Company, Managing
Director of Adaptec India Pvt. Ltd., and Co-founder & CEO of various organisations.

Dr. Jayalakshmi Kumari has a Ph.D. in social sciences, an M.A in Economics, M.A in Political Science, M.Phil. and M.Ed., with years of
experience in teaching. With proven ability to constantly challenge and improve existing processes and systems, she has been
participating and rendering voluntary services to many social organizations.
With a deep passion for teaching, Dr. Jayalakshmi brings in 15 years of experience from the educational sector having worked for
Dr. K. Jayalakshmi Kumari Non-Executive Director
leading schools and colleges in Hyderabad. Presently, she is working with the Nalanda Educational Society as a faculty in the field of
social sciences. In addition to this, she regularly conducts awareness programs for women's development, entrepreneurship, health
camps, and does community services towards encouragement of economically weaker women.
Dr. Jayalakshmi is also an Independent director in the listed company M/s Cambridge Technology Enterprises Ltd., Hyderabad.

With a PhD in Mathematics from the Indian Institute of Technology, Kharagpur, and several academic publications to her credit, Dr.
Surabhi Sinha started o" as a Research Assistant at the Council for Scientific & Industrial Research, India, way back in 1992. She
served as Project Associate in the Department of Mathematics – IIT, Kharagpur for around 7 years. Later, she moved on in 2005 to
serve as a Faculty in Hyderabad Central University for 2 years.

Dr. Surabhi Sinha Non-Executive Director

Dr. Surabhi has published several academic papers in the field of Fuzzy Programming, Multi-level Non-linear Systems, Linear
Programming Approaches, and Integer Solutions via Goal Programming.
Dr. Surabhi also holds an M.SC in Mathematics from IIT – Kharagpur, B.SC (Honors) in Mathematics from IIT-Kharagpur, and a
Diploma in Information Technology from the National Institute of Information Technology, Delhi. To note, she received a gold Medal
for excelling in the course work.
Management Structure
Suresh Reddy

Chairman & CEO

Vijay Kancharla Jacob Nizri Brad Cohen Y. Srinivas Rao

Chief Innovation O!cer President Chief Strategy O!cer Chief Financial O!cer

Management Bios
Name Title Background

Mr. Reddy serves as the Chairman & Managing Director of Brightcom Group. Prior to joining the Company, Mr. Reddy founded two
successful companies; USA Greetings and Ybrant Technologies. He has also worked in various roles across di"erent industries at
Suresh Reddy Chief Executive O!cer
Fortune 500 companies such as Caterpillar, Chrysler, SBC (PacBell) and Charles Schwab.Mr. Reddy earned his M.S. in Engineering from
the Iowa State University and a B. Tech in Mechanical Engineering from the Indian Institute of Technology (IIT), Kharagpur, India.

Mr. Kancharla leads the innovations at Brightcom Group. He is responsible for the company's worldwide technology enhancements
and innovations. Mr. Kancharla has been at the forefront of the internet revolution and has vast experience in building innovative
solutions for the online market.

Vijay Kancharla Chief Innovation O!cer Prior to co-founding USAGreetings and Ybrant Technologies, he worked with some of the Fortune 500 companies, such as Hewlett
Packard and Pacific Bell.

Mr. Kancharla holds an M. S. in Computer Science from the University of Louisville and a B. Tech. from the Jawaharlal Nehru
Technological University, Hyderabad, India.
Management Bios (Cont’d)

Mr. Yepuri joined the Company in 2001 and is responsible for the overall financial management. Previously, Mr. Yepuri has 29 years of
diversified business experience, including 18 years in senior management positions. Before joining the Company, Mr. Yepuri held several
Srinivasa Rao Yepuri Chief Financial O!cer
top financial positions in the capacity of GM, CP and CFO in the past; the latest being the CFO of LGS Global. He is a fellow member of
Chartered Accountants of India (ICCAI) and holds a master’s degree in Commerce.

Mr. Nizri joined the Company in 2007 and directs the consolidated core advertising & media division of the Company. Previously, he
was overseeing Oridian, AdDynamix and MediosOne. After being promoted to Director of European Sales in 2003, Mr. Nizri was then
Jacob Nizri President
appointed VP of Oridian in 2005. In 2006, Mr. Nizri was promoted to be the CEO of Oridian. Mr. Nizri holds two Bachelor degrees in
Management & Information Technologies and Computer Education

Mr. Cohen started at the Company in 2006 and is responsible for defining and driving the strategic initiatives, along with all M&A
activities of the Company. Prior to joining the Company, he was President of Business Integration & Strategic Initiatives at YBrant. In
2002, Mr. Cohen co-founded what is now known as MediosOne. In 1998, he cofounded Cohen Capital, and Cohen Capital Technologies
Bradley N. Cohen Chief Strategy O!cer
founded Neural Technologies, LLC. Mr. Cohen has managed more than ten successful business ventures since 1993 and started Trident
Industries, before moving on to be co-founder and President of eCollege.com. Brad received a BA from the University of Missouri in
Marketing and Political Science.
MARKET OVERVIEW
 • The Company’s business operates within today’s complex and constantly diversifying $248.6 billion Digital
Advertising industry (“DA”), which is a subset of the Global Advertising industry (“GAD”). Globally, programmatic
Market Overview advertising has become the preferred method for buying and selling digital video and display ads. Marketers are
using sophisticated ad tech to smartly target specific audiences across the internet, mobile telephone networks, and
other forms of communication media.

• The DA industry is categorized into three distinctive operators: (i) advertisers, (ii) publishers, and (iii) intermediaries.
Advertisers, refer to companies/ad agencies associated with brands, who spend money for marketing and branding
their products and services. Publishers, which focus in digital marketing, include:companies which provide content to
websites in addition to companies which attract tra!c due to the content provided by them, for the following
platforms: mobile phones, IPTV, and podcasts among others. Intermediaries, cover specialized marketing companies
Digital Advertising who connect advertisers and publishers, through their creative marketing campaigns and use of technology for

Structure delivering, monitoring and optimizing the ads. Intermediaries can be further classified into two types: (i) marketing
and (ii) technology intermediaries. Marketing intermediaries use technology for delivering, managing and optimizing
the digital campaigns of advertisers. Technology intermediaries provide technology, services and tools based on the
domain inputs of the marketing companies. Brightcom Group started as a technology intermediary and developed
into a formidable force in marketing intermediary category. The Company utilizes its internally developed technology
products, which include OneTag, Pangea, COREG, ProxyTool, and the Brightcom platform to provide digital marketing
services to its clients across the globe. Brightcom delivers more than 40 billion impressions a month across a network
of publishers and boasts a robust advertiser network with over 150 Ad agency relationships and campaigns from
thousands of direct advertisers globally.

Advertisers, which includes brands and advertising agencies, provide Demand Side Platforms (“DSPs”). Publishers,
such as web-sites that host content, provide Supply Side Platforms (“SSPs”). Ad exchange and networks are built by
intermediaries which connect DSPs to SSPs, through targeted advertising campaigns using specialized data provided
by data aggregators. The relationship between these three categories is depicted through the diagram below.
DIGITAL ADVERTISING RELATIONSHIP OVERVIEW
 The Digital Advertising industry utilizes several channels to execute advertising campaigns for brands. Some of these
media formats include: (i) display marketing, (ii) Video Advertising, (iii) Mobile Marketing (iv) search and email marketing,
(v) lead generation and (vi) Social Media Advertising

Display Ads: Display ads include strategies/techniques/tools for optimally displaying the graphic and/or visual
advertisement in various formats. Digital ads are deployed via standard web and wireless applications, email, static (e.g.
html) and dynamic (e.g. asp) web pages, and may appear in ad formats such as banners, buttons, and interstitials.
Digital Advertising Video Advertising: Advertising within existing video content and running video ads on a static page form the core of this
Channels format of advertising. Video on desktop, tablets and mobile are device dependent parts of this channel.

Search Marketing: Search marketing includes: (i) pay per click(PPC or CPC) on a search engine, (ii) paid inclusion, (iii)
search engine optimization (“SEO”).

Email Marketing: Email marketing includes: banner ads, links or advertiser sponsorships that appear in email newsletters,
email marketing campaigns and other commercial email communications.

Lead Generation: Lead generation includes advertisers paying fees to internet advertising companies that refer qualified
purchase inquiries or provide consumer information (demographic, contact, and behavioral), where the consumer opts
for being contacted by a marketer (email, postal, telephone, and or fax). These processes are priced on a performance
basis (e.g. cost-per-action, -lead or inquiry), and can include user applications, surveys, contests or registrations.

Classifieds and Auctions: Classified and auctions include advertisers paying fees to internet companies to list specific
products or services (e.g. online job boards)

Acceptance of mobile and wireless devices have enabled the growth of more digital marketing platforms. There has
Digital Marketing been a large-scale evolution of digital marketing with faster access through hi-speed broadband enabling potential

Growth customers to locate desired information, services and products precisely, securely, and instantaneously.

The chart below shows the world population by regions that are internet users against the growth since 1998.

Globally, there are over 4.1 billion internet users with a growth of 1,052% from 2000 - 2018.
 INTERNET USER GROWTH

9000

8000 7,796

7000

6000

5000 4,574
4,294
4000

3000
2,300
2000
1,340
835
1000 527 728 658 454 261 369 349
180 42 29
0
Africa Asia Europe Latin America Middle East North America Australia Total

Population Est in Millions 2020 Internet Users in Millions 2019

Source: Mckinsey, eMarketer

Global trends continue to demonstrate high growth rates for both interactive media and ad spend. This momentum in
interactive media usage is resulting in digital ad spend gaining a larger share of all advertising. It is estimated that
global spending on digital advertising was $198.0 billion in 2016, growing to $224.1 billion in 2017 and further increasing to
Global Ad Spending $248.6 billion in 2018. It is the fastest growing category of total global ad spend with a CAGR of 12.0% over the last 2
years. The Asia-Pacific region is the largest contributor of global ad spending with approximately $700.0 billion or 34.8%
share of global ad spending followed by North America at 29.5% or $591.0 billion. This growth is expected to continue as
marketers allocate more of their total marketing expenditure to interactive marketing e"orts and the industry delivers
even more e"ective and innovative platforms for connecting with consumers.
TOTAL GLOBAL AD SPENDING BY CATEGORY AND REGION
(Amounts in Millions of USD)

Category 2014 2015 2016 2017 2018 2019 2019-2014 CAGR

Digital advertising 127.3 146.6 168.5 190.5 212.0 231.4 12.7%

Broadband 429.3 463.8 500.5 539.4 581.2 624.6 7.8%
TV advertising 183.5 189.4 202.5 209.0 223,1 233.9 5.0%
In-home Video Entertainment 323.4 331.9 347.8 359.0 370.2 381.6 3.4%
Audio Entertainment 95.6 97 98.8 100.7 102.8 104.6 1.8%
Cinema 37.1 39.4 41.6 43.8 45.8 48.3 5.4%
Out of home 31.7 33.2 34.8 36.5 38.3 40.3 4.9%
Consumer Magazine publishing 59.1 57.6 56.5 55.7 55.1 54.6 -1.6%
Newspaper publishing 142.4 140.6 140.0 140.0 140.8 142.0 -0.1%
Consumer books 72.4 73.0 74.0 74.8 75.4 76.0 1.0%
Educational publishing 41.0 41.6 42.1 42.6 43.2 43.9 1.4%
Video Games 84.5 94.1 103.5 111.6 118.7 124.5 8.1%
Total 1604.0 1681.3 1779.5 1838.6 1966.9 2061.5 5.1%

Latin America
6%

Western Europe
16%

Middle East & Africa

4%
Total Ad Spend by Region (2019)
North America
37%

Asia Pacific
34%
Central & Eastern Europe
3%

Source: Internet World Stats

 When the restrictions are lifted the initial reaction of many will be to jump o#ine and do things that they couldn’t
before – visiting friends and family, visiting museums and theatres, returning to pubs, restaurants, sports grounds,
places of worship, gyms and libraries. However, digital marketers should be aware that many economists expect the
recovery to be gradual, rather than a strong rebound.

However, it is likely that for many, using the internet more for shopping, gaming, keeping in touch and other activities
will have become something of a habit.

Impact of Covid19
In addition, it could well be that consumers emerge from the crisis with some very di"erent priorities, values and
on Digital Advertising attitudes – all of which could impact how they want to spend their time and money.

“ As the world goes increasingly digital, so will marketing. Marketers will need to be nimble enough to respond
with updated strategies and buyer personas for a di!erent, post-pandemic world. ”

Source: digitalagencynetwork.com

• Gaming: a 25% jump with COVID-19

• Retail – one massive spike, but also a 34% jump in March

• Social media: 29% increase

• Travel marketing: down 38% so far

• Other categories: on-demand, news, marketplaces, etc are reacting in some unexpected ways.

Source: singular.net
 • The profile of digital spend is changing as it evolves, with engaging online video formats and social (23.5% in 2018)
growing rapidly whilst traditional display banner formats grow at more subdued single digit rates, a predicted 8.7% in
2018.

• Digital spending is becoming predominantly mobile rather than desktop, reflecting the shift in audience usage from
desktop to smartphone. Mobile ad spend, overtook desktop in 2017, as previously predicted with a 57.0% share of total
Digital Advertising digital spend versus desktop at 43.0%

Industry Evolving • Mobile spend is estimated to increase by a further 23.8% in 2018, to reach approximately $121.1million, a significant
62.0% share of digital spend for 2018. Desktop ad spend has been declining/stagnating since 2016 and is forecast to
Trends continue along this trend in 2018, with a decline of 0.2%. In the UK – globally one of the most advanced digital media
markets, mobile advertising is forecast to reach £8.7 billion, 70.0% share of digital spending in 2018.

• Much of this increased investment in mobile will be passively purchased by advertisers (as digital ad impressions are
automatically served and consumed by audiences on mobile devices as opposed to on desktop). A growing
proportion will be actively planned and purchased as advertisers seek to reach and engage mobile audiences.

• Marketers and advertisers are putting the majority of their budget into mobile ads. Digital marketing software
revenues are projected to total more than $32.0 billion in 2018, with expected revenue at $65.9 billion for mobile ads
alone. Mobile users are accessing approximately 69.0% of their annual media on their smartphones. Mobile ad spends
exceeded $143.0 billion in 2017 on a worldwide scale. It's projected to hit more than $247.0 billion by the end of 2020..

• The Company’s competitors include large global as well as, small local companies. The Company has a complete

Competition set of digital marketing tools with extensive global reach compared to its competitors. In addition, the Company
provides large scale in-house software development, which many of its competitors lack. The following table
provides a summary comparison of various tools and geographic reach between Brightcom and some of its
competitors.
COMPETITOR COMPARISON