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acquisition and digital video channels. Finally, we are focused on expanding the virality of our brands and maintaining a high rank in app stores We
believe we have the ability to expand our marketing reach over time.
Drive advertising revenue: Generating advertising revenue has historically not been a principal focus for us. As a result. we believe our advertising
revenue is substantially below what we should be able to
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achieve. Part of our strategy rs to meaningfully increase the sell-through at our Tinder brand, which is currently below 2% of available ad inventory. We
believe that Tinder's strong user engagement, with an average of approximately 9.6 million daily active users during the month ended September 30,
2015, each spending, on average, more than 35 minutes per day using the product and "swiping." on average, through 145 user profiles per day,
makes d a very attractive platform for advertisers. We also intend to meaningfully increase the percentage of ad inventory on our other brands sold on
a direct basis, which currently is below 2% of total ad inventory sold. We believe that there is meaningful upside to our current revenue levels if we
achieve these objectives.
Dynamically monetize our brands: We will continue to optimize pricing and the bundle of free and paid offerings for each brand. We also expect to
continue to develop new features that will both improve the user experience and increase the number of people willing to pay for the use of our
products. We believe that most of our products have the opportunity to increase both the percentage of users who are paid members and the amount
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that those users pay us over time.
Continue to expand our portfolio: In the past, we have successfully completed acquisitions such as OkCupid, Meetic, Twoo and Plenty01Fish, as well
as launched OurTime and 'finder. Each acquisition or new product launch has resulted in increased adoption levels either within a ghien geography or
demographic. We intend to continue to pursue strategic opportunities in existing and new markets globally, and expect that additional growth will be
generated through these pursuits.
Leverage our portfolio: We believe we are only beginning to realize the benefits that ownership of multiple brands brings to our company. We intend to
continue to optimize our operations across brands to reduce both fixed and variable costs. increase success rates in product development and
customer acquisition and accelerate speed to market.
Organizational approach
We operate a portfolio of brands that both compete and collaborate with each other. We attempt to empower individual business leaders with the authority
and incentives to grow each of our brands Our businesses compete with each other and with third-party businesses in our category on brand characteristics.
product features and business model. We also attempt to centrally facilitate excellence and efficiency across the entire portfolio by:
centralizing certain administrative areas like legal, human resources and finance across the entire portfolio to enable each brand to focus more on
growth.
developing talent across the portfolio to deploy the best talent in the most critical positions across the company at any given time: and
sharing data to leverage product and marketing successes across our businesses rapidly for competitive advantage.
Relationship with IAC/InterActiveCorp
We are currently a wholly-owned subsidiary of IAC. Upon completion of this offering, IAC will own all of the shares of our outstanding Class B common stock.
representing approximately 86.1% of our outstanding shares of capital stock and approximately 96.4% of the combined voting power of our outstanding capital
stock (or approximately 84.4% of our outstanding shares of capital stock and approximately 98.2% of the combined voting power of our outstanding capital
stock, if the underwriters exercise in full their option to purchase additional shares of our common stock in this offering).
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We intend to enter into various agreements with IAC for administrative and other services, including a master transaction agreement, an investor rights
agreement, a tax sharing agreement, a services agreement, an employee matters agreement and a subordinated loan facility. For more information regarding
these agreements, see 'Certain relationships and related party transactions:
After the initial public offering price has been determined, but prior to the completion of this offering, we will issue to IAC related-parry indebtedness with an
aggregate principal amount equal to the total net proceeds to us from this offering, assuming the underwriters exercise in full their option to purchase