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Investor Overview March 2014. Safe Harbor 1 This presentation contains forward-looking statements including, among other things, statements regarding.

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Presentation on theme: "Investor Overview March 2014. Safe Harbor 1 This presentation contains forward-looking statements including, among other things, statements regarding."— Presentation transcript:

1 Investor Overview March 2014

2 Safe Harbor 1 This presentation contains forward-looking statements including, among other things, statements regarding our business, momentum, growth and future plans. These forward-looking statements are subject to the safe harbor provisions created by the Private Securities Litigation Reform Act of Actual results could differ materially from those projected in the forward-looking statements as a result of certain risk factors, including but not limited to (i) adverse changes in general economic or market conditions; (ii) delays, reductions or slower growth in the amount spent on online and mobile advertising and the development of the market for cloud-based software; (iii) competitive factors, including but not limited to pricing pressures, entry of new competitors and new applications; (iv) adverse changes in our relationships with and access to publishers and advertising agencies; (v) level of usage and advertising spend managed on our platform; (vi) our ability to expand sales of our solutions in channels other than search advertising; (vii) our ability to expand our sales and marketing capabilities and manage our growth effectively; (viii) the development of the market for digital advertising or revenue acquisition management; (ix) acceptance and continued usage of our platform and services by customers and our ability to provide high-quality technical support to our customers; (x) material defects in our platform, service interruptions at our data center or breaches in our security measures; (xi) our ability to develop enhancements to our platform; (xii) our ability to protect our intellectual property; (xiii) our ability to manage risks associated with international operations; and (xiv) our ability to retain and attract qualified management and technical personnel. These forward looking statements are based on current expectations and are subject to uncertainties and changes in condition, significance, value and effect as well as other risks detailed in documents filed with the Securities and Exchange Commission, including in the section entitled “Risk Factors” in our quarterly report on Form 10-K for the year ended December 31, 2013, and our other filings with the SEC, which are available free of charge at the Investor Center section of our website at all of which could cause actual results to differ materially from expectations set forth in the forward-looking statements. All forward-looking statements in this presentation reflect Marin’s expectations as of February 11, Marin assumes no obligation to, and expressly disclaims any obligation to update any such forward-looking statements after the date of this presentation.

3 SaaS Platform for Digital Ad Management Better Decisions Time SavingsFinancial Lift Measure ManageOptimize 2

4 3 Revenue Acquisition Management Leader Annual Revenue ($MM) $7.5 $19.0 $36.1 $  673 active advertisers  6.3 billion ad units managed  Campaigns in 160 countries  $6.0BN of annualized ad spend in Q $77.3

5 Investment Highlights 4 Serving Large and Fast Growing Digital Ads Market Leader in Revenue Acquisition Management Comprehensive Analytical and Transactional Platform High Growth SaaS Model with Participatory Economics Proven Results for Blue-Chip Customers SearchDisplay SocialMobile

6 5 Large, Fast-Growing Digital Advertising Market Source: Magna Global, Digital Media Forecasts, December $ in billions *CAGR

7 6 Increasing Digital Marketing Challenges ComplexityFragmentationScale

8 7 Day in the Life of a Digital Marketer Operational TasksOptimizationsStrategic Opportunities  Format tracking codes  Stitch cost and revenue data  Pivot and trend data in excel  Build reports for management  Format bulk sheets for upload  Refine keywords and targeting  Test creative and landing pages  Geo and device targeting  Adjust and optimize bids  Day-part campaigns  Allocate budgets  Launch new products and offers  Test new channels and publishers  Forecast volume, profit and cost  Adjust to budget variances

9 8 Revenue Acquisition Management Platform Publisher DataRevenue & Conversion Data Search Display Social Mobile Ad Servers Analytics Marin Tracker Offline Data MeasureManageOptimize Optimization Campaign Management Reporting & Analytics

10 9 RAM Platform: Powerful & Easy To Use Analytics to Action Interface

11 10 Applied Big Data & Customer-Focused Innovation 6.3 Billion Ad units under management 3 Million Queries per month 80 Million Campaign changes per day 250+ Terabytes Stored across 50DB 1 Code Base Multi-tenant architecture 11 Major Releases Annually Iterative development

12 Key Online Ad Trends Favor a Platform Move from keywords to audiences Proliferation of channels, devices, publishers, and ad units Multi-channel bidding and attribution Focus on customers (and lifetime value) not transactions via CRM data Integrate and leverage disparate data sources 11

13 Marin’s Product Vision 12 Open platform with access to any number of marketing applications in an integrated manner (App Store) Advertisers will want a platform that connects with all their disparate data sources to ensure decisions are made using all their data. The future is targeting audiences with added insights driven by search intent and attribution. Single platform and user interface for all marketing channels and devices

14 Independent, Open Platform for Cross-Channel Revenue Acquisition 13

15 Audience Connect: Using Data to Drive Performance 14 ■ Audience Analytics ■ Look-Alike Modeling for Audience Expansion ■Intent-based Remarketing ■Audience-based Bidding for Search Optimization Blue Kai / Exelate / Lotame / Etc.

16 Audience Connect: Distribution and Optimization 15

17 Revenue Connect: Optimize Using Your Own Data True Revenue Valuation Offline Conversion Tracking Forecasting Lifetime Value Flexible Revenue Capture Certified Revenue Partner Ecosystem 16

18 Report and Optimize Across Your Portfolio of Channels Cross Channel Management Integrated Reporting and Analytics Flexible Revenue Tracking Automated Bid Calculations For Any Publisher, Any Goal Attribution Across Publishers 17

19  Publisher data for reporting and optimization  Twitter and Yandex debut by end of Q Channel Connect: More Options for RAM 18

20 Context Connect: Action Via External Data Sources Connect any contextual data source Smarter decisions with greater insight Dynamically adjust campaign objects More intelligent bid optimization Customizable through Marin Labs 19

21 Optimize Using Data That Impacts Your Business DYNAMIC ACTIONS Schedule automated actions based on performance, attributes, and settings:  Adjust bids based on Dimension values  Pause objects based on conversion rate  Increase budgets based on ROI  Update landing pages based on CTR Build complex actions to address marketing sophistication CONTEXT CONNECTIONS A flexible onramp for integrating and reporting on contextual data sources:  Weather  Stocks  Sport scores  Nielsen Rating View external data sources alongside marketing performance Drive smarter optimization strategies 20

22 Open: BoostCTR Integration 21

23 Independent, Open, Extensible RAM Platform 22

24 Industry Leaders Grow Facebook Programs With Marin 23  Rapidly scale programs  Acquire high LTV customers  Drive mobile ROI  Raise CTR’s and extend campaign life  Meet any financial or social objective  Global service and support “Marin has dramatically changed the way we advertise on Facebook and has made it one of our most effective performance marketing channels” - Chase Wells, Director of Marketing at Webtrends 23

25 24 Competitive Landscape CompetitionMarin Publisher Tools  Independent, trusted 3rd party  Cross publisher workflow and reporting  Advanced bidding and optimization tools Technology Providers  Ability to manage complexity and scale  Open, extensible platform; enterprise-class data import and export capabilities  Expert service teams with global reach Internal Build  Leading combination of power and ease of use  Support for new publisher innovation  Software as a service pricing model

26 25 Large, Underpenetrated Market 2017 $174BN Digital Advertising Market ,500+ Enterprise Opportunities >$100K / Month 2012 $98BN Digital Advertising Market ,500+ Enterprise Opportunities >$100K / Month Source: Magna Global, Marin Internal

27 26 Multiple Growth Drivers Expand Internationally Add Platform Modules Support New Publishers Acquire New Customers Grow Existing Ad Spend

28 27 Experienced Management Team Customer-Centric, Team-Oriented Culture

29 Finance Overview

30 Key Financial Highlights 29  Strong Track Record of Growth  100% SaaS Subscription Model  Increasing Ad Spend and Consistent Advertiser Growth  Growth Through New and Existing Advertisers  Highly Diversified Revenue Mix  Significant Long-Term Operating Leverage

31 30 Annual Revenue ($MM) Quarterly Revenue ($MM) $7.5 $19.0 $36.1 $59.6 $1.0 $1.4 $2.3 $2.9 $3.4 $4.6 $5.0 $6.0 $7.1 $8.1 $9.5 $11.4 $13.0 $14.0 $15.5 $17.1 $17.2 $ Q1Q2Q3 Q4 Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3 $20.1 $77.3 $21.8 Q4 Strong Track Record of Growth

32 31 100% SaaS Subscription Model JanFebMar Ad Spend$0$240,000$500,000 Rate3.50% 3.00% Fee - % of Spend-$8,400$15,000 Monthly Minimum$7,500 Marin Revenue$7,500$8,400$15,000  100% SaaS-Based Subscription Model  Revenue Based on % of Monthly Ad Spend  Shared Customer Success – Virtuous Cycle Example Customer Direct  Channel Leverage  1-2 year fixed-rate contracts  Generally 12 month terms  Minimum Fees – 50-70% of projected monthly revenues Agency

33 32 Total Active Advertisers Q1Q2Q3 Q4 Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2 Annualized Advertising Spend Under Management ($BN) $0.6 $1.7 $3.2 $4.7 Q3 610 Note: Annualized spend based on last month of the period. Active Advertisers based on Advertisers with $2,000 in revenue in at least one month of the quarter Increasing Advertisers and Ad Spend $6.0 Q4 673

34 Highly Diversified Revenue Mix 33 Note: All metrics based on FY 2013; Other includes Automotive, Healthcare, Real Estate, Industrial / Manufacturing and Government. Diversified Advertiser BaseGlobal Presence Balanced Revenue Mix % Revenue Retail Travel B2B Education Other 21% 17% 10% 7% 18% International 31% U.S. 69% Agency 48% Direct 52% Technology 14% Finance 13%

35 Q4 Highlights & 2014 Guidance 34 Note: Guidance as of February 11, See Q4-13 Earnings Release dated February 11, 2014 for Non-GAAP definition and reconciliation to GAAP metrics. Guidance  Q1: $21.4 to $21.8 million  2014: $95.0 to $96.6 million Revenue  Q1: ($8.9) to ($8.5) million  2014: ($30.5) to ($28.9) million Non-GAAP Operating Loss  Q1: ($0.28) to ($0.26)  2014: ($0.94) to ($0.90) Non-GAAP Net Loss per Share  Strong Q4 performance, beating our guidance  Total cash on balance sheet as of December 2013: $104.4 million  Improved gross margins

36 Investment Highlights 35 Serving Large and Fast Growing Digital Ads Market Leader in Revenue Acquisition Management Comprehensive Analytical and Transactional Platform High Growth SaaS Model with Participatory Economics Proven Results for Blue-Chip Customers SearchDisplay SocialMobile

37 Appendix

38 GAAP to Non-GAAP Reconciliation 37 FY2012FY2013Q4’12Q4’13 Gross Profit (GAAP) $ 34.8 $46.2$10.0$13.7 Plus Stock-based Compensation Plus Amortization of Cap'd R&D Less Capitalized R&D costs (0.0) - (0.0) - Gross Profit (Non-GAAP) $35.7$48.2$10.3$14.3 Operating loss (GAAP) ($25.3) ($34.3)($6.8)($7.9) Plus Stock-based Compensation Plus Amortization of Cap'd R&D Plus Noncash expense related to warrants Less Capitalized R&D costs (1.7) (3.2)(0.5)(0.7) Operating loss (Non-GAAP) ($21.5) ($31.2)($6.4)($6.9) Net Loss (GAAP) ($26.5)($35.9)($7.3)($8.1) Plus Stock-based Compensation Plus Amortization of Cap'd R&D Plus Noncash expense related to warrants Less Capitalized R&D costs (1.7) (3.2)(0.5)(0.7) Net Loss (Non-GAAP) ($22.2) ($32.2)($6.6)($7.0) Year Ended December 31 (in millions)


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