Artists & Labels Embrace Virtual Worlds

Lee ClancySVP Product Management & GM Direct RevenueIMVU Inc.

SXSW - March 16, 2010

2

Today’s Session

• About IMVU

• Video: IMVU Rocks!

• Music on IMVU

• Q & A

3

An online community where members use 3D avatars to meet new people, chat, create and play

What’s IMVU?

4

Company Overview

• Founded in April, 2004

• Based in Palo Alto, CA

• 70 employees

• 3 institutional rounds

• $30M raised

5

0

10

20

30

40

45M

Business Snapshot

• 3D avatars

• Virtual goods

• 45M registered users

• 10M uniques/month

• $30M+ revenue run rate

• Profitable

Cumulative Registrations

6

Attractive Demographics

70% Female

60% 18+ yrs old

60% USA

7

User-Generated Content

0.0

0.5

1.0

1.5

2.0

2.5

3.0M

06/04

12/04

06/05

12/05

06/06

12/06

06/07

12/07

06/08

12/08

06/09

3+ Million Virtual Items

8

Celebrating with Mohawks

9

Shameless Promotional Plug

We’re Hiring!www.imvu.com/jobs

10

Video: IMVU Rocks!http://www.youtube.com/watch?

v=oBGgXN1dFTY

11

IMVU Music Store

• We sell music:

– Non-interactive streaming (for use on IMVU

only)

– Downloads (DRM-free MP3)

• Both major label & independent artists

• Catalog includes over 2.4 million tracks

• Launched in November 2008

12

Music as Shared Social Experience

Music is an inherently social experience on IMVU:

• Users buy music to listen to it together…

• …and dance, dress up, or play DJ

• IMVU sells it all: dance animations, clothing &

3D furnishings

• 12 million hours listened (since launch)

• 234 million total listens (since launch)

13

Music as Retention Driver

Music buyers on IMVU…

• Are typically adult (18+)

• Buy an average of 6 (teens) to 19 (adults)

tracks

• Buy early in their IMVU experience (during

1st week)

• Remain on IMVU 6x longer than non-music

buyers

14

Promotion & Artist Development

IMVU is an effective social venue for artist

promotion:

• Album launch support via IMVU (750,000

Facebook Fans)

• Not just a retailer, but a diverse community in

many genres

• Platform for emerging artists via TuneCore

partnership

15

Emerging Opportunities

IMVU’s unique music environment enables new

experiences:

• Branded virtual merchandise campaigns with

top artists

• Artist IP + 3D virtual content = new fan

engagement

First time ever: Pink Floyd will allow IMVU “Creators” to build new 3D content using the band’s licensed trademarks

16

Q & A