Ticker: TAPM. A Mobile Gaming Leader

Transcription

1 Ticker: TAPM A Mobile Gaming Leader JUNE 2018

2 FORWARD LOOKING STATEMENTS To the extent that statements contained in this presentation are not descriptions of historical facts regarding Tapinator, they are forward-looking statements reflecting the current beliefs and expectations of management made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of Words such as targeted, may, will expect, anticipate, estimate, intend, and similar expressions (as well as other words or expressions referencing future events, conditions or circumstances) are intended to identify forward-looking statements. Examples of forward-looking statements contained in this presentation include, among others, financial guidance, statements regarding the quoting and trading of our common stock and our expectations regarding our development and monetization plans for our mobile games and decentralized apps. Forward-looking statements in this release involve substantial risks and uncertainties that could cause the development and monetization of our mobile games, future results, performance or achievements to differ significantly from those expressed or implied by the forward- looking statements. Such risks and uncertainties include, among others, the uncertainties inherent in the hits nature of the mobile gaming business and whether decentralized apps will achieve mainstream adoption. Tapinator undertakes no obligation to update or revise any forward-looking statements including any financial guidance included herein. The quoting and trading of the company s common stock on the OTC Bulletin Board and the OTC Market Group s OTC Link quotation system is often thin and characterized by wide fluctuations in trading prices, due to many factors that may have little to do with the company s operations or business prospects. As a result, there may be volatility in the market price of the shares of the company s common stock for reasons unrelated to operating performance. Moreover, the OTC Bulletin Board and the OTC Market Group s OTC Link quotation system are not stock exchanges, and trading of securities on them is often more sporadic than trading of securities listed on the NASDAQ Stock market or another securities exchange. Accordingly, stockholders may have difficulty reselling any of their shares. For a further description of the risks and uncertainties that could cause actual results to differ from those expressed in these forward-looking statements, as well as risks relating to the business of the company in general, see Tapinator s disclaimers, which are available here: 1

3 WHAT WE DO A Mobile Gaming Leader We Develop & Publish Mobile Games for the ios, Android, and Amazon platforms. 2

4 SNAPSHOT A Mobile Gaming Leader Founded in 2013, our library consists of more than 350 mobile gaming titles with over 450mm player downloads Our strategy is two-fold: (i) produce a large portfolio of Rapid-Launch Games, which have low development costs and predictable returns and (ii) produce a select number of original Full-Featured Games which have higher development costs yet offer substantial upside Our revenues and adjusted EBITDA* for 2017 were $3.1mm and $250k, respectively We generate revenues through the sale of: (i) branded advertisements and (ii) via consumer transactions, including in-app purchases We are based in New York City and have 7 employees and approximately 40 contractors We are listed on the OTCQB Market, our market cap is approximately $10.0mm, and we are debt-free * EBITDA is a non-gaap, unaudited financial measure. 3

5 INVESTMENT HIGHLIGHTS A Mobile Gaming Leader Large/growing addressable markets - mobile gaming + mobile advertising Diversified portfolio of 350+ revenue producing games that, together, have achieved network scale Low cost and highly efficient development platform Poised for strong revenue growth with high operating leverage; we have been EBITDA* positive every year since inception Disciplined ROI-based strategy of blending low cost Rapid-Launch and higher cost Full-Featured Games Efficient monetization strategy consisting of programmatic advertising sales and consumer transactions Veteran management team/board with high-growth and large internet company credentials and a track record of building successful digital media businesses * EBITDA is a non-gaap, unaudited financial measure. 4

6 TEAM BIOS Management IIYA NIKOLAYEV - Chief Executive Officer Co-Founder and CEO of Familybuilder until the sale of the Company to Intelius in He grew the business to profitability, acquired over 45 million users on the web, and over 2 million users on mobile. Mr. Nikolayev was also a cofounder of InAppFuel, a developer of patented minigame software acquired by Tapinator in Prior to Familybuilder, Mr. Nikolayev worked in banking for JP Morgan and graduated cum laude with a BA from New York University. ANDREW MERKATZ - President/CFO An accomplished entrepreneur with 20+ years of financial operations and transactional experience. Mr. Merkatz spent 6+ years at Vision Capital where he focused on digital media and software technology. Mr. Merkatz was also a cofounder of InAppFuel and Familybuilder along with Mr. Nikolayev. Mr. Merkatz earned his BA from University of Pennsylvania (cum laude), and his MBA from Harvard University. GEORGI DARAKEV - VP of Technology Led all feature development at Familybuilder. Extensive experience developing successful LAMP (Linux,Apache, MySQL, PHP) applications and web services. Expertise in scaling applications on AWS, S3, and Rightscale. Built products used by millions monthly on both the web & mobile. Cofounder of InAppFuel. Mr. Darakev earned his BS in Computer Science from Dowling College. ROBERT CRATES - Independent Director Over 25 years of experience in private equity, investing in a broad range of industries and asset categories. Mr. Crates has served on the board of directors of numerous public and private companies. Mr. Crates earned his BA from Yale University. TEYMOUR FARMAN-FARMAIAN - Independent Director Was CMO/CRO at Spotify, the world s leading music streaming service, starting in He helped triple revenue growth to hit a $500 million run rate, and achieve 7.5 million DAU. Before Spotify, Teymour worked at Zynga (ZNGA) as GM of Partnerships and at Google (GOOG) in various sales and operational roles. Teymour earned his BA from Duke University and his MBA from Harvard University. 5

7 TWO BIG MARKET OPPORTUNITIES Mobile Gaming Revenue to Grow From $34.8B in 2015 to $74.6B in 2020 Mobile Advertising Revenue Projected to Grow From $101B in 2016 to $166B in 2018 * Statista Report

8 T W O - P R O N G E D G A M E S T R AT E G Y Maximizing Risk Adjusted Returns via a Portfolio Approach Rapid-Launch Games Historically predictable returns Advertising monetization High volume, low cost Full-Featured Games Evergreen and/or top grossing potential In-app purchase monetization + subscriptions Low volume, higher cost, higher returns 7

9 RAPID-LAUNCH GAMES High Volume, Low Cost, Predictable Returns Low cost development platform Cross promotion replaces traditional user acquisition cost Over 350 active games, 96+ of which have achieved 1 million+ downloads 60% of games older than 180 days are profitable, and 71% after one year $6.9K $26k 3.8x Average Development Cost per Game* Average Contribution Margin per Game* Average ROI per Game* *Historical data from 391 Rapid-Launch games from 7/1/13 through 12/31/17. *Figures include projected revenue and cost data over estimated remaining life. 8

10 RAPID-LAUNCH GAMES High Volume, Low Cost, Predictable Returns 9

11 FULL-FEATURED GAMES Low Volume, Higher Cost, Higher Returns Product Focus: Unique game play with in-depth content High retention with best-in-class monetization, including subscription Build unique IP and selectively license branded IP Recently launched top grossing games generate huge revenue numbers: Clash Royale, launched 03/2016, generated $1 billion in its first year 1 Gardenscapes, launched 08/2016, has a $36+ million revenue run rate 2 Design Home, launched 11/2016, has a $60+ million revenue run rate 3 $500K $2.5mm 5.0x Avg. Target Development Cost per Game 4 Avg. Target Contribution Margin per Game 5 Avg. Target ROI per Game 1 VentureBeat, 02/15/17 2 MobileDevMemo, 09/19/16 3 Glu Q1 2017, Earnings Presentation 4 Target development cost for 1.0 launch is <$100k 5 Top grossing games are able to achieve many multiples of this target 10

12 FULL-FEATURED GAMES Low Volume, Higher Cost, Higher Returns We have launched seventeen full-featured games Thirteen were Featured as New Games We Love Nine reached the Top 50 in Games We are well positioned to launch top grossing products in 2018 and beyond Ilya Nikolayev CEO Interviewed on TheStreet Dec 1,

13 FULL-FEATURED GAMES Recent Launches: Solitaire Dash and Fusion Heroes Solitaire Dash 2.0 Fusion Heroes 12

14 FULL-FEATURED & GAME PIPELINE Major Planned Game Launches for 2018 Q Q Q Divide & Conquer Freemium Subscription Game 1 - TBA Freemium Subscription Game 2 - TBA 13

15 DIVERSIFIED REVENUE SOURCES Advertising & Consumer Transactions Advertising Consumer Transactions 2017: 57% of Revenue Long-Term Target: 30% of Revenue 2017: 43% of Revenue Long-Term Target: 70% of Revenue 14

16 MONETIZATION BEST PRACTICES Our Ads Do Not Disrupt Gameplay & Provide Value to Users 1 No Ads During Gameplay 2 INTERSTITIAL ADS Shown Between Levels 1 Ads Tie Into Game Currency 2 REWARDED VIDEO ADS Provide Value 15

17 MONETIZATION BEST PRACTICES Our In-App Purchases Enhance Gameplay 1 Free to Play 2 Monetize Gameplay with Consumables & Non-Consumables 16

18 OPERATIONAL EXCELLENCE Creating Barriers to Entry 350+ Games Zero paid marketing to acquire game s first 100k players Cross Promotion System Top search placement & ability to move games up the leaderboards 10m+ MAU App Store Optimization 450m+ Installs Platform Relationships Data Analytics Strong platform editorial relationships (13 New Games We Love on ios) 200,000+ Daily Installs Expertise in Live Operations: Player analytics, attribution, and ad optimization 17

19 PLAYER & GAME METRICS We Have Built a Robust & Defensible Network Metrics as of Q1 2018: Average DAUs 662,000 Average MAUs 11.1 million Average New Daily Downloads 238,000 Cumulative Downloads 432 million as of March 31, 2018 Game Library 386 active titles as of March 31,

20 FUTURE OPPORTUNITIES Publishing, Acquisitions and New Platforms Expand publishing initiatives to leverage our network, platform relationships, and operational excellence Pursue acquisitions within the mobile gaming and app market. Focus on small, nimble teams with evergreen products Experiment with emerging markets including blockchain, and voice platforms as well as new geographic regions 19

21 FINANCIAL HIGHLIGHTS +30% Annual Bookings Growth Target for ($ in thousands) 2017 Audited Q Median Guidance BOOKINGS $3,499 $883 $4,241 REVENUE 3, ,024 ADJUSTED EBITDA* TOTAL DEBT 1, CASH 247 1,595 1,308 * A Non-GAAP Measure 20

22 KEY FACTS SHARE STATISTICS (as of 06/22/2018) Trading Symbol (OTCQB) TAPM Stock Price $0.105 Common Shares Outstanding 30d Avg. Volume Market Cap Float 95.6mm 284k $10.0mm 21.2mm shares Insider/Employee Ownership 37% OTHER Personnel 7 FTE Fiscal Year Ends 12/31 Website Corporate HQ Legal Auditor Tapinator.com New York, NY Quick Law Group Liggett & Webb, P.A. 21

23 THANK YOU For more information and a copy of our presentation, go to: 22