Mobile Gaming Success Story: Lessons Learned and Growth Strategies for the Future

1. (Almost) A Year in the App Store: A 20 minute Case Study Julian Farrior, CEO / Founder

2. Snapshot: • Casual games for a new breed of mobile gamers • Founded 04/01/09 • Products have been live for 9.5 months • 21,000,000+ installs to date • 4 products peaked in the top 5 overall • 1 product never touched the top 100 • $2,300,000 in net revenue • $1,300,000 app store sales (net) • $1,000,000 mobile ad sales (net) • Raised $145,000 in initial startup capital • 7 full time employees (+8 contractors) • Boulder, CO based

3. Ragdoll Blaster Paper Toss Harbor Havoc 3D Strike Knight Physics-Ball #3 Paid #1 Free #26 Strategy ? Free ? Free RDB Lite PT: World Tour Dr. Shocker NinJump HH3D Lite ? Free #3 Free #4 Paid #41 Strategy ? Free Dynamite Surfing Cat & Mouse Ragdoll Blaster 2 PT: Ad Free Harbor Havoc 3D #12 Simulation ? Free ? Free ? Paid ? Free Caverns RDB2 Lite PT: Time Traveler ? Free ? Paid ? Free

4. What we did right: • Assembled a talented (and experienced) team • Focused on distribution • Gave away something of value for free, leveraged heavily • Diversified revenue streams • App store sales (enormous downward pricing pressure) • Mobile advertising • In-app purchases • Kept production cycles short • Designed for the medium • Designed for the audience • Created economies • Met the press • Worked with Apple • Listened to users

5. Paper Toss – Monthly Impressions/Levers:

6. RDB House Ads in “Paper Toss” RDB Lite Goes Live Ragdoll Blaster Daily Downloads: Catalysts RDB Lite House Ads in “Paper Toss” Featured by Apple in: “What’s Hot” Heavy house ad rotation in Jan. Price Dropped from $1.99 to $.99 Holiday Lift Featured by Apple in: “What We’re Playing”

7. What we did wrong: • Harbor Havoc 3D • Launched in an overly saturated market (line drawing games) • Flight Control and 15+ others • Pushed for press coverage too soon • App rejected by Apple - delayed launch, press efforts wasted • Development cycle ran upwards of 3 months • Did not beta test enough • Gameplay was not quite ready (FF button, saving game, etc.) • Botched lite version with wrong free level • Cannibalized sales • Overly reliant on potential PT lift • Designed to be a paid app not a free app • Would have been better as the latter • Have not yet diversified into in-app purchases • Need to scale quicker – window is small

8. What we want to do now: • Blow out distribution, 2010 focus • 5-10 free apps per quarter • Keep the pipe wide and impressions high • Expand mobile advertising capacity • Explore in-app purchases • Continue to build/expand franchises • Aggressively grow team/output • Scale revenue curve • Push free products to other platforms? • Build our own backend tools? • Explore turn based gaming • License content • Increase social elements in games • Continue to build a brand • Free with $.99 buyouts

9. Concerns: • Narrow window to truly scale distribution • Power of free is starting to catch on • Zynga / CrowdStar / Playfish / Playdom / DeNA will become serious about the iPhone • What does the Quattro acquisition by Apple mean for developers / advertisers / users? • Why hasn’t the blueprint for virtual goods yet exploded on mobile? • Time to move is now on turn based games • Waiting for Android (or any other comp. platform) to become meaningful • How do I best communicate directly with users? How important is this?

10. Final Thoughts (Predictions) • Brand will matter (more) • Distribution will matter (more) • Data will matter (more) • Mobile Advertising will change the game • 2010 will be exciting, fallout/rollup has begun • Non-gaming audience will continue to expand • Mitigating volatility in the business is crucial • Applying portfolio theory • Maintaining our footprint is critical • Have fun, it beats working for a living

11. Q&A