Overview

New York-based SNAP Interactive, Inc. originally launched stand-alone online dating site IamFreeTonight.com in 2006. Then came the May ‘07 Facebook® Platform launch – SNAP recognized this as an extraordinary opportunity to acquire users at little to no cost and immediately shifted its focus to building dating applications on Social Networking websites. Today SNAP has 8 total applications across Facebook, MySpace, Hi5 and Bebo. Its brands “Are You Interested”, “Meet New People” and “Flirt With Me” have over 15 million total users and receive in excess of 1 million visits per day.

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Investment Highlights

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Market Opportunity/Profile

The Cultural Shift from Online Dating to Social Networking

The numbers are staggering, 15 million+ user installs, 1 million+ daily visits and 800,000 daily active users. But what do these numbers mean? In a nut shell, they mean big business. SNAP Interactive, Inc. originally launched a stand-alone online dating site named IamFreeTonight.com in 2006. Then came the May ‘07 Facebook® Platform launch – SNAP recognized this as an extraordinary opportunity to acquire users at little to no cost and immediately shifted its focus to building dating applications on Social Networking websites. Today SNAP has 8 total applications across Facebook, MySpace, Hi5 and Bebo. Its brands “Are You Interested”, “Meet New People” and “Flirt With Me”.

The revenue model is quite simple, the Company used a platform such as Facebook.com, which according to comScore, is the leading social networking site based on monthly unique visitors, with an estimated 132.1 million unique visitors in June 2008 and growing. Secondly, the Company introduced an application that people wanted to use while using Facebook. The Company then imbedded advertising into the applications and turned an application with little upfront cash into a money maker. The Company utilized the explosive growth of social networking websites and the mushrooming effect that comes with these applications to create a high-margin business model with plenty of upside potential.

As of the first quarter of '08, the Company became profitable and has enjoyed five quarters of consecutive revenue growth. During the Company's latest quarter, evidence of how successful the Company has become in such a short time is all in the numbers. Revenues increased from $35,383 for the three months ended September 30, 2007 to $871,324 for the three months ended September 30, 2008, an increase of $835,941, or 2,300%. Net Income completely reversed from a loss of $79,538 during the same time period to a stunning $410,283 profit. This reversal resulted in SNAP's net income increasing to approximately $0.04 per share versus a net loss of approximately $0.01. Numbers like that should wet every investor's appetite, and alongside the explosive growth for social networks such as Facebook.com and MySpace.com, this growth will most likely continue to increase exponentially.

The online dating industry is expected to grow to $1.9 billion by 2012, but Match.com and other online dating websites growth is slowing while Facebook and other social networks speed ahead. Industry leaders are suffering from flat subscription and revenue growth, while the social networks continue to grow rapidly – Facebook has just reached 100 million users and is now the 4th most-trafficked site in the world.

The Social Networking Application industry is brand new and constantly evolving (i.e. mobile opportunities). Applications like SNAP’s present the first real way to date on Social Networking sites, and users are clearly embracing them – Facebook’s dating apps have already achieved a combined 28 million users. SNAP is uniquely positioned as a leader in the emerging “Social Dating” space as well as the entire exploding Social Networking Application industry.

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The Idea

• Online dating industry growing to $1.9 billion by 2012, but Match.com and others' growth slowing while Facebook and other social networks speed ahead
• Application industry in its infancy; huge front-runner opportunity for companies that "get it
• More large sites launching application platforms every month, dramatically expanding user acquisition opportunities

The Investment Thesis

• SNAP is already profitable despite early focus on user growth ahead of monetization
• Already 15 million+ users, 1 million+ daily visits at minimal marketing cost
• 5 consecutive quarters of revenue growth, with 63% growth in Q3 '08

The Growth Catalysts

• Aggressive monetization strategy as company matures and industry evolves
• Mobile dating presents exciting new opportunities for expansion/growth
• User base of 16 million people and key Social Networking sites foothold make a SNAP association attractive to major players

Recent News and Press Releases

•Major Milestone: SNAP Exceeds 15 Million Users on Facebook(R) Platform
Marketwire (Wed, Nov 19)

•SNAP Interactive Nearly Triples Quarterly Net Income, Grows Quarterly Revenue 63%
Marketwire (Mon, Nov 17)

 

•SNAP Interactive Recaps Major Milestones to Date and Provides Operational Outlook
Marketwire (Wed, Oct 22)

•SNAP Interactive Provides Third Quarter 2008 Revenue Guidance
Marketwire (Wed, Oct 15)

•SNAP INTERACTIVE, INC Financials
EDGAR Online Financials (Wed, Aug 27)

•SNAP Interactive Reports Q2 2008 Financial Results
Marketwire (Tue, Aug 19)

•SNAP INTERACTIVE, INC Files SEC form 10-Q, Quarterly Report
EDGAR Online (Wed, Aug 13)

•SNAP Interactive's 'Are You Interested' Dating Application Surpasses 10 Million Users on Facebook(R) Platform
Marketwire (Tue, Jul 15)

•SNAP Interactive, Inc. Reports First Quarter Financial Results Revenue of $519,902, Net Income of $190,509, and EPS of $0.02
Marketwire (Thu, May 22)

•SNAP INTERACTIVE, INC Files SEC form 10-Q, Quarterly Report
EDGAR Online (Fri, May 16)

•SNAP Interactive, Inc. Releases Preliminary 2008 First Quarter Revenues
Marketwire (Mon, Apr 21)

•SNAP Interactive, Inc. to Launch 'Are You Interested' & 'Flirt With Me' Applications on MySpace
Marketwire (Tue, Apr 15)

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Management

Cliford Lerner - President & CEO

• Founder and Chairman of the Board
• Social Networking Application industry pioneer
• Former Lehmen Brothers analyst (Equities Division)
• BA in Applied Economics and Business Management from Cornell University

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Contact

Investor Relations Contact:

Cirrus Financial Communications, LLC
Justin K. Davis

Phone: (877) 977-STVI (7884)
Email: justin.davis@cirrusfc.com
Web: www.cirrusfc.com

Company Contact:

SNAP Interactive, Inc.
1375 Broadway, Floor 3,
New York, NY 10018

Phone: (516) 942-2030
Email: contact@snap-interactive.com

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FORWARD LOOKING STATEMENTS

This report includes forward-looking statements that reflect SNAP Interactive, Inc. current expectations about its future results, performance, prospects and opportunities. SNAP Interactive, Inc. has tried to identify these forward-looking statements by using words and phrases such as "may," "will," "expects," "anticipates," "believes," "intends," "estimates," "plan," "should," "typical," "preliminary," "we are confident" or similar expressions. These forward-looking statements are based on information currently available and are subject to a number of risks, uncertainties and other factors that could cause SNAP Interactive, Inc.'s actual results, performance, prospects or opportunities to differ materially from those expressed in, or implied by, these forward-looking statements. These risks, uncertainties and other factors include, without limitation, the Company's growth expectations and ongoing funding requirements, and specifically, the Company's growth prospects with scalable customers, and those outlined above. Other risks include the Company's limited operating history, the Company's history of operating losses, consumers' acceptance, the Company's use of licensed technologies, risk of increased competition, the potential need for additional financing, the terms and conditions of any financing that is consummated, the limited trading market for the Company's securities, the possible volatility of the Company's stock price, the concentration of ownership, and the potential fluctuation in the Company's operating results.

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