- Viadeo Group

Transcription

- Viadeo Group

NOT FOR DISTRIBUTION IN THE UNITED STATES, CANADA, AUSTRALIA OR JAPAN
CONFIDENTIAL
PRELIMINARY INTERNATIONAL OFFERING MEMORANDUM DATED JUNE 17, 2014
Up to 2,118,425 Shares
This global offering is part of an offering of up to, based on the midpoint of the indicative range of the offering price, (i)
1,993,298 newly issued shares (if the Increase Option, as such term is defined below, is fully exercised) (or 1,995,383
newly issued shares if the Increase Option is fully exercised and based on the lower limit of the indicative range of the
offering price) and (ii) 125,127 existing shares (or 139,029 existing shares based on the lower limit of the indicative
range of the offering price) of Viadeo, a French société anonyme (“Viadeo” or the “Company”). The offering of up to
2,118,425 shares (based on the midpoint of the indicative range of the offering price) (the “Offering”) with a par value of
€0.02 each, includes a public offering in France (the “French Public Offering”) and this global offering, which is a
private placement mainly to certain institutional investors inside and outside France, except in the United States, Canada,
Australia and Japan (the “International Offering”).
The French Public Offering is being made pursuant to a separate offering document prepared in accordance with French
regulations. This Preliminary International Offering Memorandum (the “International Offering Memorandum”) relates
only to the International Offering.
It is currently proposed that the offering price will be between €17.10 and €20.90 per share. This price range is indicative
only and is subject to change. The offering price for the shares sold in the French Public Offering and the International
Offering will be identical.
Viadeo and some of its shareholders are initially offering respectively (i) 1,716,982 newly issued shares and (ii) 125,127
existing shares (based on the midpoint of the indicative range of the offering price) to be sold in the Offering. The
number of newly issued shares initially offered may be increased through an additional 276,316 new shares (based on the
midpoint of the indicative range of the offering price) offered by Viadeo (the “Increase Option”). If the Increase Option
is exercised in full, up to 1,993,298 newly issued shares will be offered (based on the midpoint of the indicative range of
the offering price).
In addition, the selling shareholders named herein have granted to the Managers an option to purchase at the offering
price up to an additional 15% of the total number of shares offered in the Offering (including the newly issued shares that
may be offered upon exercise of the Increase Option), i.e., up to an additional 317,763 existing shares (based on the
midpoint of the indicative range of the offering price) (the “Overallotment Option”). This option is granted solely for the
purpose of covering over-allotments and stabilization activities, if any, and will be exercisable in whole or in part, on one
occasion, during the 30 calendar days from the date of publication of the offering price, i.e., according to the indicative
timetable by July 31, 2014. If the Increase Option and the Overallotment Option are exercised in full, up to 2,436,188
shares will be offered, including 1,993,298 newly issued shares and 442,890 existing shares (based on the midpoint of the
indicative range of the offering price).
Prior to the Offering, there has been no public market for the shares. Viadeo has applied to have all its shares listed on the
regulated market of Euronext in Paris (Compartment B) under the label VIAD. The shares will not be listed on any other
exchange.
Investing in the shares involves risks. See “Risk factors” in Section 2 of the English translation of the securities
note (Note d’opération) included herein as Annex A and in Section 4 of the English translation of the registration
document (Document de base) included herein as Annex B, for a discussion of important factors to be considered
in connection with an investment in the shares. Investors are advised to carefully read this International Offering
Memorandum in its entirety, including the Annexes hereto.
Offering price range: €17.10 to €20.90 per share
The information in this International Offering Memorandum is preliminary and will be supplemented by a pricing
supplement which will contain additional information about the Offering, including, among other matters, the final price
per share offered hereby and the number of shares to be sold in the French Public Offering and the International Offering.
Viadeo’s shares have not been and will not be registered under the U.S. Securities Act of 1933, as amended (the
“Securities Act”). Viadeo’s shares may not be offered or sold, directly or indirectly, in the United States. See
“Important Information about Jurisdictional and Selling Restrictions” in this International Offering
Memorandum and paragraph 5.2.1 of the English translation of the securities note (Note d’opération) included
herein as Annex A.
Jefferies International Limited and Société Générale Corporate & Investment Banking (together, the “Joint Lead
Managers and Joint Bookrunners”) and Oddo & Cie (the “Co-Lead Manager”) (together with Jefferies International
Limited and Société Générale Corporate & Investment Banking, the “Managers”) are severally underwriting the shares
being offered. The Managers expect to deliver the shares through the book-entry facilities of Euroclear France, Euroclear
Bank S.A./N.V. and Clearstream Banking S.A., société anonyme (Luxembourg) on or about July 4, 2014.
This international offering memorandum does not constitute an offer to sell or subscribe nor a solicitation to purchase or
subscribe for securities in any countries where such offer or solicitation is not permitted.
Joint Lead Managers and Joint Bookrunners
Co-Lead Manager
IMPORTANT INFORMATION ABOUT THIS INTERNATIONAL OFFERING MEMORANDUM
This international offering memorandum is confidential and is being furnished solely for the purpose of enabling a
prospective investor to consider whether to subscribe for shares or to purchase shares as described herein. Any
reproduction or distribution of this international offering memorandum, in whole or in part, and any disclosure of its
contents or use of any information herein for any purpose other than considering an investment in the shares is
prohibited. Each person, by accepting delivery of this international offering memorandum, agrees to the foregoing.
In making your investment decision, you should rely only on the information contained in this International
Offering Memorandum as supplemented by the pricing supplement or to which Viadeo has referred you. Viadeo
has not authorized anyone to provide you with information other than what is contained in this International
Offering Memorandum.
You should not assume that the information in this International Offering
Memorandum is accurate as of any date other than the date on the front cover of this International Offering
Memorandum. The Company’s business, financial condition, results of operations and prospects may have
changed since such date.
Neither Viadeo nor the Managers are making any representation to you regarding the legality of an investment in the
shares by you under appropriate legal investment or similar laws. You should not construe the contents of this
International Offering Memorandum as investment, business, legal, tax or other advice. You should consult your own
counsel, accountants and other advisors as to investment, business, legal, tax, financial and related aspects of a
subscription or purchase of the shares. You are responsible for conducting your own investigation and analysis regarding
Viadeo and assessment of the merits and risks of investing in the shares.
Viadeo’s shares offered hereby have not been and will not be registered under the Securities Act, or under the securities
laws of any state or other jurisdiction within the United States, and may not be offered or sold within the United States
except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities
Act and in compliance with any applicable state securities laws. Accordingly, no offer is being made in the United States
and this document does not constitute an offer, or an invitation to apply for, or an offer or invitation to subscribe for or
purchase any Viadeo shares in the United States. The shares are only being offered outside the United States in offshore
transactions (as defined in Regulation S) in accordance with Regulation S under the Securities Act, and are not being
offered or sold, directly or indirectly, within the United States. See “Important Information about Jurisdictional and
Selling Restrictions” below.
The information contained in this International Offering Memorandum has been furnished by Viadeo and other sources it
believes to be reliable. This International Offering Memorandum is being furnished by Viadeo solely for the purpose of
enabling a prospective institutional investor to consider the subscription or purchase of Viadeo shares in the International
Offering described herein. No representation or warranty, express or implied, is made by the Managers or any of their
affiliates or selling agents as to the accuracy or completeness of the information contained in this International Offering
Memorandum, and nothing contained in this International Offering Memorandum is, or shall be relied upon as, a promise
or representation, whether as to the past or the future.
No person has been authorized to give any information or to make any representations in connection with the offering or
sale of Viadeo’s shares other than those contained in this International Offering Memorandum, and, if given or made,
such information or representations must not be relied upon as having been authorized by Viadeo, the Managers, any of
their affiliates or any other person. The information contained in this International Offering Memorandum is provided as
of the date hereof. Neither the delivery of this International Offering Memorandum at any time nor any subsequent
commitment to subscribe or purchase the shares shall, under any circumstances, create any implication that there has
been no change in the Company’s business since the date of this International Offering Memorandum.
The distribution of this International Offering Memorandum and the offer of the shares in certain jurisdictions may be
restricted by law. Persons receiving this International Offering Memorandum are required by the Company and the
Managers to inform themselves about, and to observe, any such restrictions. This International Offering Memorandum
constitutes neither an offer of, nor an invitation to subscribe or purchase the shares in any jurisdiction in which such an
offer or invitation would be unlawful. No action has been taken in any jurisdiction other than France that could permit a
public offering of the shares, or the circulation or distribution of this International Offering Memorandum or any other
offering material, where action for such purpose is required.
This International Offering Memorandum contains a non-official English translation of portions of the French Prospectus
(as defined under “Important Information about Jurisdictional and Selling Restrictions — Notice to Prospective Investors
in France”). In the event of any inconsistencies between statements contained in the translation and the portions of the
text that have been translated herein, the text of the French Prospectus shall be considered authoritative. Neither the
Company, nor either of the Managers assume any liability with respect to the free translation of the portions of the
French Prospectus included in this International Offering Memorandum.
Viadeo reserves the right to withdraw the Offering at any time and Viadeo and the Managers reserve the right to reject
any offer to subscribe or purchase, in whole or in part, for any reason, or to issue or sell less than all of the shares offered
hereby.
STABILIZATION
IN CONNECTION WITH THIS OFFERING, SOCIETE GENERALE (OR ANY ENTITY ACTING ON ITS
BEHALF), ACTING AS A STABILIZING MANAGER IN THE NAME OF AND ON BEHALF OF THE
MANAGERS (THE “STABILIZING MANAGER”) MAY (BUT IS NOT OBLIGED TO) UNDERTAKE
STABILIZATION TRANSACTIONS IN COMPLIANCE WITH APPLICABLE LAW AND REGULATIONS,
IN PARTICULAR, THE PROVISION OF EU COMMISSION REGULATION N°2273/2003 OF 22 DECEMBER
2003 REGARDING IMPLEMENTATION OF DIRECTIVE 2003/06/CE OF THE EUROPEAN PARLIAMENT
AND OF THE COUNCIL OF 28 JANUARY 2003 ON INSIDER DEALING AND MARKET MANIPULATION
(THE “EU REGULATION N°2273/2003”). THERE IS NO GUARANTEE THAT ANY SUCH STABILIZATION
MEASURES WILL BE INITIATED AND IN THE EVENT THAT STABILIZATION MEASURES ARE
INITIATED, THEY MAY BE DISCONTINUED AT ANY TIME WITHOUT PRIOR NOTICE. THE PURPOSE
OF THE STABILIZING TRANSACTIONS IS TO STABILIZE OR MAINTAIN THE MARKET PRICE OF
THE SHARES. SUCH TRANSACTIONS MAY AFFECT THE MARKET PRICE OF THE SHARES AND MAY
RESULT IN A PRICE OF THE SHARES THAT IS HIGHER THAN THE PRICE THAT OTHERWISE
MIGHT PREVAIL. IN THE EVENT THAT STABILIZATION MEASURES ARE INITIATED, THEY MAY
BE CARRIED OUT OVER FOR UP TO 30 CALENDAR DAYS FROM THE DATE OF PUBLICATION OF
THE OFFERING PRICE, I.E., ACCORDING TO THE INDICATIVE TIMETABLE, FROM JULY 1, 2014
UNTIL (AND INCLUDING) JULY 31, 2014. THE RELEVANT MARKET AUTHORITIES AND INVESTORS
WILL BE INFORMED BY THE STABILIZING MANAGER IN ACCORDANCE WITH ARTICLE 9 OF THE
EU REGULATION N°2273/2003 AND ARTICLE 631-10 OF THE AMF’S GENERAL REGULATION.
IMPORTANT INFORMATION ABOUT JURISDICTIONAL AND SELLING RESTRICTIONS
General
The distribution of this International Offering Memorandum and the offer and sale of the shares in certain jurisdictions
may be restricted by law. Viadeo and the Managers require that persons into whose possession this International
Offering Memorandum comes inform themselves about and observe any such restrictions. No offer or sale of shares may
be made in any jurisdiction except in compliance with the applicable laws thereof. The shares are subject to restrictions
on transferability and resale and may not be transferred or resold except as permitted under the Securities Act and
applicable securities laws. This International Offering Memorandum does not constitute an offer of, or an invitation to
subscribe or purchase, shares in any jurisdiction in which such offer or invitation would be unlawful. You should be
aware that you may be required to bear the financial risks of this investment for an indefinite period of time.
No action has been taken in any jurisdiction by Viadeo or the Managers that would permit a public offering of the shares
offered hereby, other than in France. The French Public Offering is being made pursuant to a separate offering document
prepared in accordance with French regulations. See “Notice to Prospective Investors in France”. This International
Offering Memorandum relates only to the International Offering.
For additional information about the selling restrictions applicable to the Offering, see paragraph 5.2.1 of the English
translation of the securities note (Note d’opération) included herein as Annex A.
Notice to Prospective Investors in France
This International Offering Memorandum has not been and will not be submitted to the clearance procedures of the
French Autorité des marchés financiers (the “AMF”), and accordingly may not be distributed to the public in France or
used in connection with any offer to purchase or sell any of the shares to the public in France. For the purpose of the
offering in France, a prospectus, which received visa no. 14-297 dated 17 June 2014 from the AMF (the “French
Prospectus”), in the French language has been prepared (consisting of (i) a registration document (Document de base),
which was registered by the AMF on 27 May 2014 under no. I.14-037 and (ii) a securities note (Note d’opération), dated
17 June 2014, and includes a section describing certain risk factors relating to Viadeo and the International Offering, as
well as a summary of Viadeo’s business). Such prospectus is the only document by which offers to subscribe for shares
or purchase shares may be made to the public in France.
Notice to Prospective Investors in the European Economic Area (other than France)
No action has been taken nor will be taken to allow the Company’s shares to be offered to the public in any member state
of the European Economic Area (the “Member State”) that has implemented the Prospectus Directive (other than in
France) where a prospectus may be required to be published in such Member State, except that the shares may be offered
in such Member States:
(i)
to qualified investors, as defined in the Prospectus Directive;
(ii)
to fewer than 100, or if the Member State has implemented the relevant provision of the Amending
Directive, 150 individuals or legal entities other than qualified investors (as defined in the Prospectus
Directive) per Member State;
(iii)
in any other circumstances falling under Article 3(2) of the Prospectus Directive.
For the purposes of this provision, (i) the expression an “offer of the shares to the public” in relation to any shares in any
Member State means the communication in any form and by any means of sufficient information on the terms of the
offer and the shares to be offered so as to enable an investor to decide to subscribe for the shares, as such expression may
be varied in the Member State, (ii) the expression “Prospectus Directive” means the Directive 2003/71/EC of 4
November 2003, as implemented in a member state (as modified including by the Amending Directive, insofar as it has
been implemented by each Member State) and (iii) the expression “Amending Directive” means the Directive
2010/73/UE of the European Parliament and of the Council of 24 November 2010.
This selling restriction applies in addition to any other selling restrictions which may be applicable in the Member States
that have implemented the Prospectus Directive.
Notice to Prospective Investors in the United Kingdom
This International Offering Memorandum and any other material in relation to the shares described herein is only
addressed to and intended for persons who are (i) outside the United Kingdom, (ii) investment professionals falling
within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the “Order”),
(iii) high net worth entities and other such persons falling within Article 49(2)(a) to (d) of the Order (“high net worth
companies”, “unincorporated associations”, etc.) or (iv) other persons to whom an invitation or inducement to engage in
investment activity (within the meaning of Section 21 of the Financial Services and Market Act 2000) may otherwise
lawfully be communicated or caused to be communicated (all such persons in (i), (ii), (iii) and (iv) together being
referred to as “Relevant Persons”). Any invitation, offer or agreement to subscribe, purchase or otherwise acquire such
shares is only available to, and will only be engaged in with, Relevant Persons. The Company’s shares referred to in this
International Offering Memorandum may not be offered or issued to persons in the United Kingdom other than Relevant
Persons. Any person who is not a Relevant Person should not act or rely on this document or any of its contents. The
persons responsible for distributing the International Offering Memorandum shall comply with the legal provisions
governing its distribution.
Notice to Prospective Investors in the United States
The shares offered hereby have not been and will not be registered under the Securities Act, or under the securities laws
of any state or other jurisdiction within the United States, and may not be offered or sold within the United States except
pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and
in compliance with any applicable state securities laws. Accordingly, no offer is being made in the United States and this
document does not constitute an offer, or an invitation to apply for, or an offer or invitation to purchase or subscribe for
any Viadeo shares in the United States. The shares are only being offered outside the United States in offshore
transactions (as defined in Regulation S under the Securities Act), in accordance with Regulation S under the Securities
Act, and are not being offered or sold, directly or indirectly, within the United States.
Any person who subscribes or acquires shares will be deemed to have represented, warranted and agreed, by accepting
delivery of the International Offering Memorandum or delivery of the shares, that is subscribing or acquiring the shares
in compliance with Rule 903 of Regulation S in an offshore transaction (as defined in Regulation S).
Any person in the United States who obtains a copy of this International Offering Memorandum is required to disregard
it.
Notice to prospective investors in Canada, Australia and Japan
The shares shall not be offered, sold or acquired in Canada, Australia or Japan.
INDUSTRY AND MARKET DATA
This International Offering Memorandum contains information about the markets in which the Company
operates and their trends, the Company's competitors and its competitive positioning, particularly in Section 6.2 entitled
“The professional social network market” of the English translation of the registration document (Document de base)
included herein as Annex B. This information has been obtained mainly from market research conducted by external
sources and from the Company’s own estimates. While the Company believes such information to be reliable, it has not
been independently verified, and neither the Company nor the Managers, nor any of its or their respective representatives
make any representation as to the accuracy of such information. It is also possible that the data and estimates may be
inaccurate or out of date, or that the forecast trends do not occur for the same reasons as described above which could
have a material adverse impact on the Company's operations, outlook, financial position, results, development or targets.
Trends in the Company’s business activities may differ from the market trends described in this International Offering
Memorandum. The Company, the Managers, and any of its or their respective representatives undertake no obligation to
update such information.
In addition, in many cases the Company has made statements in this International Offering Memorandum regarding its
industry and position in the industry based on its estimates and experience and on its investigation of market conditions.
The Company cannot assure the prospective investors that any of these assumptions are accurate or correctly reflects its
position in the industry and none of its internal surveys or information has been verified by any independent sources.
DEFINITIONS
In this International Offering Memorandum:

“$”, “dollars” or “U.S.$” refer to the lawful currency of the United States;

“€” or “euros” refer to the single currency of the member states of the European Union participating in the third
stage of the economic and monetary union pursuant to the Treaty on the Functioning of the European Union, as
amended and supplemented from time to time;

“EU” refers to the European Union;

“IFRS” refers to the International Financial Reporting Standards as adopted in the European Union; and

all references to the “Issuer”, “Viadeo” and the “Company” are to Viadeo.
PRESENTATION OF FINANCIAL INFORMATION
This International Offering Memorandum includes the financial statements of the Company prepared in accordance with
IFRS (the “IFRS Financial Statements”) as of and for the years ended 31 December 2012 and 31 December 2013. These
financial statements have been provided in appendices to the English translation of the registration document (Document
de base) included herein as Annex B.
Unless otherwise indicated, all financial information concerning the Company as of and for the years ended
31 December 2012 and 2013 referred to in this International Offering Memorandum has been derived from the IFRS
Financial Statements.
Some financial information in this International Offering Memorandum has been rounded and, as a result, the numerical
figures shown as totals in this International Offering Memorandum may vary slightly from the exact arithmetic
aggregation of the figures that precede them.
FORWARD-LOOKING STATEMENTS
This International Offering Memorandum contains forward-looking statements and information about the Company’s
targets and its ongoing projects. Sometimes these forward-looking statements are indicated by the use of the future or
conditional tense accompanied by words such as “believe”, “estimate”, “consider”, “aim”, “intend”, “envisage”,
“anticipate”, “expect”, “plan”, “should”, “wish”, “may” and other similar expressions. These forward-looking statements
and information about targets and ongoing projects are based on data, assumptions and estimates which the Company
believes to be reasonable. They may be affected by known or unknown risks and uncertainties related to the regulatory,
economic, financial and competitive environment, as well as other factors that could cause the Company's future results,
performance and achievements to differ materially from the outcomes described or implied by members of the Board of
Directors and senior executive management. These factors include changes in general economic and commercial
conditions, regulatory changes and the risks described in Section 4 “Risk factors” of the English translation of the
registration document (Document de base) included herein as Annex B and in Section 2 “Risk factors” of the English
translation of the securities note (Note d’opération) included herein as Annex A. In addition, other sections of this
International Offering Memorandum describe additional factors that could adversely affect the Company’s results of
operations, financial condition, liquidity, dividend policy and the development of the industries in which it operates.
New risks can emerge from time to time, and it is not possible for the Company to predict all such risks, nor can it assess
the impact of all such risks on its business or the extent to which any risks, or combination of risks and other factors, may
cause actual results to differ materially from those contained in any forward-looking statements. Given these risks and
uncertainties, you should not rely on forward-looking statements as a prediction of actual results.
ABOUT THIS INTERNATIONAL OFFERING MEMORANDUM
This International Offering Memorandum comprises the following documents, included herein as Annex A and B,
respectively:
(i) the non-certified English translation of the Company’s securities note (Note d’opération), the French version of which
was filed with the AMF on 17 June 2014 under no. 14-297, except for:
(a) cover page: AMF visa together with related textbox and reference to copies available,
(b) Summary of the Prospectus and indicative timetable: reference to the AMF visa,
(c) the reference to the completion letter of Company’s statutory auditors in section 1.2 entitled “Declaration by
the persons responsible for the Prospectus”, and
(d) Section 5.1.1 - indicative timetable: reference to the AMF visa,
which do not constitute part of the non-certified English translation of the Company’s securities note (Note
d’opération) included in Annex A of this International Offering Memorandum, and,
(ii) the non-certified English translation of the Company’s registration document (Document de base), the French version
of which was registered by the AMF on 27 May 2014 under no. I.14-037, except for:
(a) the reference to the AMF visa paragraph, and
(b) the reference to the completion letter of Company’s statutory auditors in section 1.2 entitled “Declaration by
the persons responsible”,
which do not constitute part of the non-certified English translation of the Company’s registration document
(Document de base) included in Annex B of this International Offering Memorandum.
You should not make any investment decision based on the excluded sections referenced above, and any references to the
securities note (Note d’opération) and the registration document (Document de base) in the International Offering
Memorandum as supplemented by the pricing supplement are deemed to exclude such sections.
In the event of any ambiguity or conflict between corresponding statements or other items contained in these noncertified English translations and the original French versions, the relevant statements or items of the French versions
shall prevail.
ANNEX A
ENGLISH TRANSLATION OF THE SECURITIES NOTE (NOTE D’OPÉRATION)
This English-language translation of the French-language original was prepared for your convenience. In the event of any
inconsistencies between this document and the French-language original, the latter shall prevail.
A French société anonyme with a share capital of €157,676.50
Registered office: 30 rue de la Victoire 75009 Paris
Paris Trade and Companies Register No.: 487 497 414
SECURITIES NOTE (NOTE D’OPERATION)
information provided to the public in connection with:



the public placement in an open price offering in France and a global placement primarily with institutional
investors in France and abroad, of 1,716,982 new shares of the Company Viadeo to be issued under a cash
capital increase with cancellation of preferential subscription rights in the form of a public offering which
may be increased to a maximum of 1,993,298 new shares (in the event of the full exercise of the increase
option and based on the midpoint of the indicative range of the offering price);
the public placement in an open price offering in France and a global placement primarily with institutional
investors in France and abroad of a maximum of 125,127 existing shares transferred by a number of Viadeo
shareholders, which may be increased to a maximum of 442,890 shares (in the event of the full exercise of the
overallotment option and based on the midpoint of the indicative range of the offering price); and
the admission to trading on Compartment B of the regulated market of Euronext in Paris of all existing shares
constituting the Company's share capital and based on the lower limit of the indicative range of the offering
price, 831,691 shares resulting from the conversion of convertible bonds and a maximum of 1,995,383 new
shares (in the event of full exercise of the Increase Option).
Duration of the open price offering: from 18 June 2014 to 30 June 2014 (inclusive)
Duration of the global placement: from 18 June 2014 to 1 July 2014 (inclusive)
Indicative price range applicable to the open price offering and the global placement:
from €17.10 to €20.90 per share
The price could be set at under €17.10 per share. Should the upper limit of the indicative price range above be
adjusted or should the offering price be set above €20.90 per share, orders issued under the open price offering may
be revoked during a period of at least two trading days.
[INTENTIONALLY OMITTED]
The prospectus (the "Prospectus") approved by the AMF consists of:

the Viadeo document de base registered by the AMF on 27 May 2014 under number I.14-037 (the "document
de base"),

this securities note, and

the Prospectus summary (included in the securities note).
Copies of the Prospectus are available free of charge from Viadeo's registered office at 30 rue de la Victoire, 75009
Paris. It may also be consulted on the Viadeo website (www.corporate.viadeo.com/en) and on the AMF website
(www.amf-france.org).
Co-Lead Manager
Company’s Counsel
SUMMARY
1
PERSONS RESPONSIBLE ....................................................................................................................... 27
1.1
1.2
1.3
2
PERSONS RESPONSIBLE FOR THE PROSPECTUS ....................................................................................... 27
DECLARATION BY THE PERSONS RESPONSIBLE FOR THE PROSPECTUS .................................................... 27
PERSONS RESPONSIBLE FOR THE FINANCIAL INFORMATION.................................................................... 27
RISK FACTORS CONNECTED TO THE OFFERING ........................................................................ 28
2.1
THE COMPANY'S SHARES HAVE NEVER BEEN TRADED ON A FINANCIAL MARKET AND ARE SUBJECT TO
MARKET FLUCTUATIONS. ................................................................................................................................... 28
2.2
THE MARKET PRICE OF THE COMPANY'S SHARES MAY BE AFFECTED BY SIGNIFICANT VOLATILITY ........ 28
2.3
THE SALE OF A LARGE NUMBER OF COMPANY SHARES BY ITS MAIN SHAREHOLDERS MAY HAVE A
SIGNIFICANT IMPACT ON THE MARKET PRICE OF THE COMPANY'S SHARES ......................................................... 29
2.4
THE OFFERING WILL BE CANCELLED IF THE UNDERWRITING AGREEMENT IS NOT SIGNED OR IS
TERMINATED ...................................................................................................................................................... 29
2.5
RISKS CONNECTED TO INSUFFICIENT SHARE SUBSCRIPTIONS AND TRANSFERS AND CANCELLATION OF
THE OFFERING ................................................................................................................................................... 29
2.6
THERE ARE NO PLANS TO INTRODUCE A DIVIDEND PAYMENT POLICY IN THE SHORT TERM GIVEN THE
CURRENT STAGE OF THE COMPANY'S DEVELOPMENT ......................................................................................... 29
3
KEY INFORMATION ............................................................................................................................... 30
3.1
3.2
3.3
3.4
4
NET WORKING CAPITAL STATEMENT ...................................................................................................... 30
SHAREHOLDERS' EQUITY AND NET DEBT ................................................................................................ 30
INTEREST OF INDIVIDUALS AND LEGAL ENTITIES TAKING PART IN THE OFFERING.................................. 31
REASONS FOR THE OFFERING AND INTENDED USE OF THE NET PROCEEDS FROM THE TRANSACTION ...... 32
INFORMATION ON THE SECURITIES TO BE OFFERED AND ADMITTED TO TRADING .... 33
4.1
TYPE, CLASS AND ENTITLEMENT DATE OF THE SHARES OFFERED AND ADMITTED TO TRADING .............. 33
4.2
APPLICABLE LAW AND COMPETENT COURTS .......................................................................................... 34
4.3
FORM AND METHOD OF REGISTRATION OF COMPANY’S SHARES ............................................................ 34
4.4
CURRENCY ............................................................................................................................................. 34
4.5
RIGHTS ATTACHED TO THE SHARES ........................................................................................................ 36
4.6
AUTHORISATIONS .................................................................................................................................. 37
4.6.1
General shareholders’ meeting of the Company that authorised the issuance ............................. 37
4.6.2
The Company's board of directors having decided on the principle of the issuance .................... 39
4.6.3
Selling Shareholders ..................................................................................................................... 39
4.7
SCHEDULED SETTLEMENT/DELIVERY DATE ............................................................................................ 41
4.8
RESTRICTIONS ON FREE TRADING IN THE COMPANY'S SHARES ............................................................... 41
4.9
FRENCH REGULATIONS GOVERNING TENDER OFFERS ............................................................................. 41
4.9.1
Mandatory tender offers ................................................................................................................ 41
4.9.2
Buyback tender offers and squeeze-outs........................................................................................ 41
4.10 TENDER OFFERS ON THE COMPANY'S SHARE CAPITAL INITIATED BY THIRD PARTIES DURING THE PRIOR
FISCAL YEAR AND THE CURRENT FISCAL YEAR ................................................................................................... 41
4.11 WITHHOLDING TAX ON DIVIDENDS PAID TO NON-FRENCH TAX RESIDENTS ............................................ 41
4.12 SPECIAL SYSTEM APPLICABLE TO PERSONAL EQUITY PLANS ("PEA") .................................................... 42
5
TERMS OF THE OFFERING................................................................................................................... 44
5.1
TERMS OF THE OFFERING, INDICATIVE TIMETABLE AND SUBSCRIPTION PROCEDURES ........................... 44
5.1.1
Terms of the Offering .................................................................................................................... 44
2
5.1.2
5.1.3
5.1.3.1
5.1.3.2
Offering amount ............................................................................................................................ 45
Offering procedure and period ...................................................................................................... 45
Main characteristics of the Open Price Offering ........................................................................................ 45
Main characteristics of the Global Placement ............................................................................................ 47
5.1.4
Revocation or suspension of the Offering ..................................................................................... 48
5.1.5
Order reduction ............................................................................................................................. 49
5.1.6
Minimum or maximum number of shares for which an order may be placed ............................... 49
5.1.7
Order revocation ........................................................................................................................... 49
5.1.8
Payment and settlement procedures of Offered Shares ................................................................. 49
5.1.9
Publication of the results of the Offering ...................................................................................... 49
5.1.10
Preferential subscription rights..................................................................................................... 49
5.2
PLAN FOR DISTRIBUTION AND ALLOTMENT OF SECURITIES .................................................................... 50
5.2.1
Category of potential investors - Countries where the Offering will be opened – Limitations
applicable to the Offering ............................................................................................................................. 50
5.2.1.1
5.2.1.2
Categories of potential investors and countries where the Offering will be opened .................................. 50
Limitations applicable to the Offering ....................................................................................................... 50
5.2.2
Intention to subscribe expressed by the Company's main shareholders or members of its
administrative, management or supervisory bodies or anyone intending to place a subscription order in
excess of 5% .................................................................................................................................................. 51
5.2.3
Pre-allotment disclosure ............................................................................................................... 52
5.2.4
Notice to subscribers ..................................................................................................................... 52
5.2.5
Increase Option ............................................................................................................................. 52
5.2.6
Overallotment Option .................................................................................................................... 52
5.3
PRICE DETERMINATION .......................................................................................................................... 52
5.3.1
Price determination method .......................................................................................................... 52
5.3.1.1
5.3.1.2
5.3.2
Price of Offered Shares .............................................................................................................................. 52
Price range assessment criteria .................................................................................................................. 53
Procedure for publishing the Offering Price and changes to the parameters of the Offering ...... 55
5.3.2.1
Date of Offering Price determination ........................................................................................................ 55
5.3.2.2
Publication of the Offering Price and the number of Offered Shares ........................................................ 55
5.3.2.3
Amendment of the price range, setting the Offering Price outside the range and changes to the number of
New Shares ................................................................................................................................................................. 56
5.3.2.4
Early closing or extension of the Offering ................................................................................................. 57
5.3.2.5
Material changes to the terms of the Offering ........................................................................................... 57
5.3.3
Limitation or cancellation of preferential subscription right ........................................................ 57
5.3.4
Price disparity ............................................................................................................................... 57
5.4
PLACEMENT AND UNDERWRITING ......................................................................................................... 58
5.4.1
Details of the financial institutions managing the initial Public Offering..................................... 58
5.4.2
Details of the establishment responsible for securities, financial and depositary services ........... 58
5.4.3
Underwriting Agreement ............................................................................................................... 58
5.4.4
Lock-up undertakings .................................................................................................................... 59
5.4.5
Signature date of the Underwriting Agreement and settlement/delivery of the New Shares ......... 59
6
ADMISSION TO TRADING AND TRADING PROCEDURES ........................................................... 60
6.1
6.2
6.3
6.4
6.5
7
ADMISSION TO TRADING ........................................................................................................................ 60
TRADING MARKET .................................................................................................................................. 60
CONCOMITANT SHARE OFFERING ........................................................................................................... 60
LIQUIDITY CONTRACT ............................................................................................................................ 60
STABILISATION ...................................................................................................................................... 60
HOLDERS OF SECURITIES WISHING TO SELL .............................................................................. 62
3
7.1
INDIVIDUALS OR ENTITIES WISHING TO SELL THEIR EQUITY SECURITIES OR SECURITIES GIVING ACCESS
TO THE COMPANY'S SHARE CAPITAL .................................................................................................................. 62
7.2
NUMBER AND CLASS OF SECURITIES OFFERED BY THE HOLDERS OF SECURITIES WISHING TO SELL ........ 62
7.3
ABSTENTION AND LOCK-UP UNDERTAKINGS .......................................................................................... 62
8
OFFERING-RELATED EXPENSES........................................................................................................ 64
9
DILUTION .................................................................................................................................................. 65
9.1
IMPACT OF THE ISSUANCE OF THE NEW SHARES ON THE GROUP'S CONSOLIDATED SHAREHOLDERS'
EQUITY 65
9.2
9.3
10
10.1
10.2
10.3
10.4
11
11.1
AMOUNT AND PERCENTAGE OF THE DILUTION RESULTING FROM THE ISSUANCE OF THE NEW SHARES .. 65
BREAKDOWN OF SHARE CAPITAL AND VOTING RIGHTS .......................................................................... 66
ADDITIONAL INFORMATION .......................................................................................................... 69
ADVISORS WITH A CONNECTION TO THE TRANSACTION ......................................................................... 69
OTHER INFORMATION VERIFIED BY THE STATUTORY AUDITORS ............................................................ 69
EXPERT'S REPORT................................................................................................................................... 69
INFORMATION CONTAINED IN THE PROSPECTUS PROVIDED BY A THIRD PARTY ...................................... 69
UPDATE OF COMPANY-RELATED INFORMATION ................................................................... 70
CORRECTION OF MATERIAL ERRORS IN THE DOCUMENT DE BASE ............................................................ 70
4
In this securities note, the terms "Viadeo" or the "Company" refer to Viadeo SA, a French société anonyme with
a board of directors whose registered office is at 30 rue de la Victoire, 75009 Paris (France), registered in the
Paris Trade and Companies Register under number 487 497 414. "Group" refers to the group of companies
constituted by the Company, all its subsidiaries and sub-subsidiaries and the companies it controls.
Warning
Forward-looking statements
The Prospectus contains forward-looking statements and information on the orientation of the Viadeo Group.
These are sometimes identified by the use of the future and conditional tenses and by forward-looking words
such as "considers", "plans" "thinks", "targets", "expects", "intends", "should", "aims", "estimates", "believes",
"wishes" and "may" or, where applicable, the negative of these same terms, or any other similar variant or
terminology. This information is not historical data and must not be interpreted as a guarantee that the facts and
data stated will occur. This information is based on data, assumptions and estimates that the Company considers
reasonable. It may change or be affected by uncertainties related in particular to the economic, financial
competitive and regulatory environments. This information is mentioned in a number of different sections of the
Prospectus and contains data relative to the Group's intentions, estimates and objectives, in particular
concerning its market, strategy, growth, results, financial position, cash position and forecasts. The forwardlooking statements given in the Prospectus are provided solely as at the date of the Prospectus. The Group
operates in a competitive and constantly changing environment. As a result, it cannot anticipate all the risks,
uncertainties or other factors that may affect its business, their potential impact on its business or the degree to
which a risk or combination of risks could cause the actual future results to be materially different from those
expressed in the forward-looking statements. Such statements are not a guarantee of actual results.
Risk factors
Investors are invited to carefully consider the risk factors described in chapter 4 "Risk factors" of the document
de base and in section 2 of this securities note before making any investment decision. The occurrence of all or
part of these risks is likely to have a material adverse impact on the Group's business, financial position, results
or prospects. Moreover, other risks that have not yet been identified or that the Company deems to be nonmaterial as at the date of approval of the Prospectus, may also have a material adverse impact.
5
SUMMARY OF PROSPECTUS
This summary comprises a series of key information, referred to under the term "Elements", presented in five
sections (A to E) and numbered from A.1 to E.7.
This summary contains all of the Elements that need to be included in the summary of a prospectus concerning
this class of transferable securities and this type of issuer. As not all Elements need to be disclosed, the
numbering of the Elements in this summary is not continuous.
In some instances, no relevant information may be provided in relation to a given Element that needs to be
included in this summary, on account of the class of transferable securities and the type of issuer. In these cases,
the summary includes a brief description of the Element in question with the specification "Not applicable".
Section A - Introduction and disclaimer
A.1
Disclaimer
This summary should be considered an introduction to the Prospectus.
Any decision to invest in the transferable securities covered by the public offering and
for which admission to trading on a regulated market is sought must be based on a
comprehensive review of the Prospectus by the investor.
Should an action be brought before a court concerning the information contained in the
Prospectus, the plaintiff may have to bear the costs of having the Prospectus translated
before the proceedings may begin, pursuant to the national legislation of member states
of the European Community or signatories of the European Economic Area Agreement.
The persons submitting the summary, including - where applicable - its translation, shall
be liable only if the summary's contents are misleading, inaccurate or contradictory to
the other parts of the Prospectus or if the summary, combined with the other parts of the
Prospectus, does not provide key information to help investors considering an investment
in these transferable securities.
A.2
Issuer's consent
on the use of
the Prospectus
Not applicable
Section B - Information on the issuer
B.1
B.2
Corporate name
and trading
name
Viadeo (the "Company" and, taken together with its subsidiaries and sub-subsidiaries it
controls, the "Group").
Registered
office/Legal
form/Governing
statute/Country
of origin
Registered office: 30 rue de la Victoire 75009 Paris.
Trading name: Viadeo; viadeo.com.
- Legal form: French société anonyme with a board of directors.
- Governing statute: French law.
- Country of origin: France.
6
B.3
Nature of
operations and
main activities
Created in France in 2005 by Dan Serfaty and Thierry Lunati, Viadeo is a global player
in professional social networks (PSNs). Viadeo allows professional users, by signing up
to the website www.viadeo.com free of charge, to create a profile and develop a
professional network. Although Viadeo has members across the world, the Group
focuses its efforts in a number of key geographical regions, such as France and China,
where it leads the market in terms of the number of registered members*. The Group
employed 447 people in 2013 and conducted business in eight languages. It has adopted
a differentiated strategy consisting of taking local characteristics into account (a socalled "multi-local" strategy).
Presence on a PSN (for people either in or seeking employment) provides the
opportunity to manage their career, identify new business opportunities, maintain a link
with contacts to allow them to track their professional activity and have an accessible,
up-to-date online address book. The PSN enables links to be forged between members
and allows those links to be used to access other contacts through recommendations, thus
multiplying the possible interactions.
Moreover professional social networks offer companies various information,
communication and recruitment possibilities. Viadeo allows client companies to rapidly
identify professionals who meet their recruitment criteria and/or circulate job postings in
order to contact them. PSNs are also a shop window for these businesses, which can also
use Viadeo to communicate about their products or company.
As of the end of May 2014, the Viadeo Group has more than 60 million members
worldwide, including almost 9 million in France and 20 million in China, and is
experiencing solid growth, with around 700,000 new members per month (figures
measured in 2013).
The Group has adopted a multi-local strategy, focusing its development in France,
China, Russia and the countries of the CIS (Commonwealth of Independent States), as
well as in North and West Africa (mainly Morocco, Tunisia, Algeria and Senegal). In
these regions, the Group is the leader in terms of number of members (data at end of
March 2014):

No.1 in China (more than 20 million members);

No.1 in France (almost 9 million members);

No.1 in French-speaking Africa (more than 2.5 million members);

Key player in Russia and the CIS (almost 1 million members).
The Group posted 11.5% year-on-year growth in consolidated revenue from ordinary
activities to nearly €30.9 million in 2013 (generated primarily in France (95%), as well
as in the regions referred to above; at the present time, the Group has not launched any
monetisation activities with regards to its 27 million members in the rest of the
world).The Group's revenue mainly comes from three separate sources (in % of revenue
from ordinary activities):

online member subscriptions (51.1%),

sale to companies of recruitment and training services (28.5%),

marketing and advertising services (16%).
7
In order to manage the expansion of the membership base and the growing number of
interactions between contacts, and to take full advantage of the growth of the Internet on
mobile phones and tablets, the Group made some major changes to its technology
platform in 2013. The new platform uses advanced technology, processes information
more quickly and in greater quantities and has been designed to optimise mobile uses.
*Company estimates based on the Group's number of registered members compared to the number
of registered members as published by the Group's two main listed competitors on their respective
websites for the principal markets in which they operate.
B.4a
Main recent
trends affecting
the issuer and its
operating
segments
Recent developments
The Group has continued to pursue its development strategy since 31 December 2013,
and has experienced continued growth in its membership base and usage.
The membership base of the Group continued to grow at a steady pace since the end of
December 2013. Over 1.8 million members joined the Group in the first quarter of 2014,
of which more than 1.3 million in China and over 250,000 in France.
The Viadeo platform’s usage indicators are steadily increasing (average in the first
quarter 2014 vs. the fourth quarter 2013):

Unique Visitors:
+10%

Distinct Logins:
+5%

Data Profile:
+13%

Invitations accepted from direct contacts: +56%
The Mobile business has also recorded very strong growth in the quarter (average in the
first quarter 2014 vs. the fourth quarter 2013):

Unique Visitors: +7%

Visits:
+22%
This positive trend has had a strong commercial impact on the first quarter of 2014
compared to the same period in 2013, with services under production (services under
production correspond to invoices issued over the period, following the client's approval
of the purchase order) and orders received for Recruitment/Training and
Marketing/Advertising services all increasing significantly.
(In thousands of euros)- unaudited data Billings for Recruitment and training
services
31 March
2013
31 March 2014
2,817
3,288
Change
+17%
Group data (Viadeo and Tianji segments)
(In thousands of euros) - unaudited data Order book for Marketing and Advertising
Services
31 March 2013
421
31 March
2014
537
Change
+28%
Income recognized for accounting in the first quarter of 2014 does not, at this stage,
reflect the sales momentum. The Group's business is mainly related to services sold in
the form of subscriptions, revenue recognition takes into account the spread of income
from subscriptions sold over the duration of contracts (mostly over 12 months). As a
result, 2014 first quarter billings will have a positive impact on future income.
8
The evolution of income from operating activities by operating segment at the end of
March 2014 compared to the end of March 2013 is as follows:
(euros 000) (unaudited data)
VIADEO segment
TIANJI segment
Inter-segment
Q1 2013* Q1 2014
Q1 trim
Q 2013
2014
transactions
Consolidated
Q1 2013* Q1 2014 change
Online subscriptions
3 974
3 729
-
-
-
-
3 974
3 729
Recruitment and training services
2 056
2 051
109
122
-
-
2 165
2 173
0%
807
833
99
16
-
-
905
849
-6%
6 836
6 614
208
138
-
-
7 044
357
168
91
88 (91)
(88)
357
168 -53%
7 193
6 782
299
226 (91)
(88)
7 401
6 920 -6,5%
Marketing and advertising services
Turnover**
Other Income
Total revenues from operating activities
-6%
6 752 -4,1%
* In order to provide comparable data, the figures presented for the first quarter of 2013 have been adjusted for:
- Revenues from operating activities of the Group’s subsidiaries which were discontinued in 2013 (as
described in notes 1.2.1 and 28 of section 20.1 of the document de base);
- Revenues from operating activities in Russia (i.e. €56,000 in Q1 2013), as of 1 January 2014, taking
into account the rights and obligations of the partnership, the participation in the joint venture VIM
LLC is accounted for using the equity method in accordance with the provisions of IFRS 11 (no share
of Revenues from operating activities is recognized).
** The Group's revenue includes the three revenue lines presented as described in 9.1.2 of the document de
base.
In the Viadeo segment
i) Evolution of revenues for Online Subscriptions
Revenues for the first quarter of 2014 were down 6% compared to the first quarter
of 2013, in line with the Group's forecasts given the impact of the change of
platform in 2013 and the growth of Mobile use, which has yet to be materially
monetised.
ii) Evolution of revenues for Recruitment and Training
Revenues for the first quarter of 2014 were stable compared to the first quarter of
2013.
Billing, which corresponds to the production of the Recruitment and training
services sold, increased over the same period by 18%.
(euros 000) - unaudited data Billing for Recruitment and Training
services
31 March
2013
2,773
31 March 2014
3,268
Change
+18%
Correspondingly, the recorded deferred revenues (prepaid income) grew by 15%
in the first quarter of 2014 compared to the first quarter of 2013.
(euros 000) - unaudited data Deferred revenues for Recruitment and
Training services
31 March 2013
2,959
31 March
2014
3,407
Change
+15%
This amount corresponds to deferred revenues to be recognised in future periods.
iii) Evolution of revenues for Marketing and Advertising Services
The revenues of the first quarter of 2014 compared to that achieved in the first
quarter of 2013 increased by 3% (to €833,000 at end-March 2014) with a backlog
at year-end, up 28%.
In the Tianji segment
9
Given the emphasis on member acquisition and use in China to date, revenues generated
by Tianji remain insignificant.
Objectives
Viadeo's ambition is to become the professional social network of reference on the
Group's markets. To this end, the Group aims to work in the following key development
areas:
 Continuing to increase the number of members;

Increasing income, notably from the recruitment services;

Taking advantage of the huge rise in mobile device usage and related income;

Benefiting from the Company's strong growth in emerging markets;

Improving operational efficiency.
With its efforts in these development areas, the Group will be pursuing the following
aims:
For the Viadeo segment :
Concerning income from recruitment and training services, the recovery is expected
to lead to a significant increase in billing in 2014, which will not be recorded under
income in 2014 (due to the time lapse between billing and recording of income based
on the duration of use of the services by clients).
In the mid-term, the average yearly growth of this source of income is expected to
exceed +35%.
The income from On-line Subscriptions stream is expected to see a stabilisation in
revenue in late 2014, and moderate growth in the following years.
The Viadeo segment should generate an EBITDA margin in excess of 20% in the
mid-term, with a target of 35% in the long-term.
For the Tianji segment:
The efforts to increase Tianji's membership should lead to the number of members
hitting 50 million in the mid-term.
10
B.5
The issuer's
Group
At the date of the Prospectus, the Group has the following legal structure:
Viadeo SA
(France)
APVO Corporation
(United States)
100%
100%
“Wayson”
(Hong Kong)
100%
"Viadeo IM" B.V.
(The Netherlands)
“Boren”
(China)
50%
100%
(1)
“VIM” LLC
(Russia)
“Yingke“
(China)
Viadeo Maroc SARL 100%
(Morocco)
Viadeo Limited
(United Kingdom)
100%
Soocial B.V.
(The Netherlands)
100%
99.99%
“ApnaCircle“
(India)
100%
Sabri SARL
(France)
0.01%
Xiaoje Wu and Yingshou Guoeach hold 50% of the capital of Yingke. Wayson exercises
contractual control over Yingke due to agreements between Yingke, Boren and Wayson,
as described in section 7.2 of this document de base.
B.6
Main
shareholders
Shareholding structure
As of the date of the Prospectus, the Company's share capital totals €157,676.50 divided into 7,883,825 shares
with a par value of €0.02 per share, all fully paid up.
Position as at the date of the Prospectus on a non-diluted basis and after exercise of the call options granted by
certain shareholders of the Company:
11
Shareholding prior to
the Offering18)
Shareholding after the
Offering(1) (3)
Offering(2) (3)
Offering in the event of
reduction of the issuance
to 75% of the amount of
the issuance initially
planned(3) (3bis)
Number of
shares
% of
capital and
voting
rights
Number of
shares
% of
capital
and
voting
rights
Number of
shares
% of capital
and voting
rights
Number of
shares
% of
capital
and voting
rights
25
0.00%
25
0.00%
1,083
0.01%
5,972
0.06%
Karen Serfaty(4)
358,925
4.55%
291,718
3.04%
291,718
2.75%
284,251
2.84%
Thierry
Lunati(deputy
CEO)(5)
342,325
4.34%
291,701
3.04%
292,759
2.76%
292,023
2.92%
Founders and
related parties(6)
701,275
8.90%
583,444
6.08%
585,560
5.51%
582,246
5.82%
AV3 (formerly
AGREGATOR)(7)
1,316,350
16.70%
1,316,350
13.71%
1,316,350
12.39%
1,316,350
13.16%
Idinvest Partners(8)
1,109,800
14.08%
1,109,800
11.56%
1,138,012
10.71%
1,268,411
12.68%
Ventech(9)
970,875
12.31%
970,875
10.11%
977,928
9.20%
1,010,527
10.10%
AFV2
Investissement(7)
359,275
4.56%
359,275
3.74%
359,275
3.38%
359,275
3.59%
BPI France
Participations
(formerly FSI)
524,500
6.65%
524,500
5.46%
552,712
5.20%
683,111
6.83%
CREADEV
221,200
2.81%
221,200
2.30%
221,200
2.08%
221,200
2.21%
PGA Invest(11)
226,500
2.87%
226,500
2.36%
226,500
2.13%
226,500
2.26%
Allianz Vie
104,900
1.33%
104,900
1.09%
104,900
0.99%
104,900
1.05%
Other financial
investors(12)(13)
538,625
6.83%
538,625
5.61%
551,301
5.19%
609,891
6.10%
Financial
investors
5,372,025
68.14%
5,372,025
55.95%
5,448,178
51.27%
5,800,165
57.98%
CBC (China
Biznetwork
Corp)(14)
1,124,825
14.27%
1,124,825
11.72%
1,124,825
10.59%
1,124,825
11.24%
Unyk Holding
277,925
3.53%
277,925
2.89%
277,925
2.62%
277,925
2.78%
ApnaCircle
shareholders
202,125
2.56%
202,125
2.11%
202,125
1.90%
202,125
2.02%
Soocial
shareholders
41,200
0.52%
41,200
0.43%
41,200
0.39%
41,200
0.41%
A Capital(15)
-
-
-
-
352,492
3.32%
391,657
3.92%
1,646,075
20.88%
1,646,075
17.15%
1,998,567
18.81%
2,037,732
20.37%
164,450
2.09%
157,154
1.64%
157,154
1.48%
156,344
1.56%
Public
-
-
1,842,109
19.19%
2,436,188
22.93%
1,426,766
14.26%
Total
7,883,825
100.00%
9,600,807
100%
10,625,647
100%
10,003,253
100%
Shareholders
Dan
Serfaty(Chairman
and CEO)
(10)
Other investors(16)
Natural
persons(17)
(1)
After sale of the 125,127 Sold Shares as part of the Offering and on the basis of the midpoint of the
indicative range of the Offering Price and excluding exercise of the Increase Option and the
Overallotment Option.
(2)
After sale of 125,127 Sold Shares as part of the Offering and after exercise, in full, of the Increase
Option and the Overallotment Option and on the basis of the midpoint of the indicative range of the
Offering Price.
(3)
Assuming the conversion of all convertible bonds on the basis of a price equivalent to the midpoint of
12
the indicative range of the Offering Price, or €19.00 (except in the event of the reduction of the
issuance to 75% of the initially planned issuance, based on the lower limit of the indicative range of
the Offering Price).
(3b) Assuming the Offering is reduced to 75% of the amount of the issue initially planned and the sale of
all the Initial Sold Shares, based on the lower limit of the indicative range of the Offering Price.
(4)
In addition to this direct interest, NOUCHKA (92.40% controlled by Karen Serfaty) has an indirect
interest via a 12.45% interest in AV3, which itself has a 16.70% capital interest in the Company.
(5)
In addition to this direct interest, MARLU (45% controlled by Thierry Lunati) has an indirect interest
via a 23.38% interest in AV3, which itself has a 16.70% capital interest in the Company.
(6)
Taking into account the factors indicated in notes 4 and 5 above, the founders and related parties
hold a total of 990,609 shares directly or indirectly, i.e. 12.57% of the Company's share capital on a
non-diluted basis and a total of 1,827,259 shares, i.e. 19.62% of the Company's share capital on a
fully diluted basis.
(7)
These holding companies will disappear in the months following the Company's IPO in favour of
direct holdings in the Company's share capital by their respective current shareholders.
(8)
Capital interest held via 18 innovation mutual funds and 1 management company.
(9)
Capital interest held via 1 venture capital mutual fund.
(10) AFV2 is a holding company which groups together Viadeo's historic shareholders. It was created
during the Company's first funding round in June 2006 in order to simplify Viadeo's equity structure.
It currently has 26 shareholders. The founders and related parties do not own any shares (directly or
indirectly) in this holding.
(11) PGA Invest is a family holding owned by the Guénant family.
(12) Among which no individual investor holds more than 2.03% of the Company's share capital.
However, since acquiring a stake in the Company in April 2012, Jefferies International Limited has a
1.46% interest in the Company's share capital and voting rights.
(13) The Company has been informed of the planned disposal by Financière WM (of which William
Johnston, Company director, is manager and majority shareholder) of 14,300 Company shares out of
the 104,900 that it owns.
(14) Viadeo holds 9.55% of the shares in CBC as a result of the subscription for two $5.1 million capital
increases in 2007, prior to the Group's acquisition of the Tianji platform. Viadeo does not have any
other management role within CBC and, in view of CBC's shareholder structure, does not have any
significant influence likely to influence any decisions taken by the partners.
(15) Interest held via one mutual fund.
(16) Companies, funds or natural persons who have become Company shareholders as a result of various
acquisitions made by the Group (primarily bond conversions and repayments of contributions in kind
made in Viadeo shares).
(17) The number of shares on a non-diluted basis primarily concerns the Company's former employees
having exercised their founders' warrants (BSPCE).
(18) Given the exercise of the call options granted by existing shareholders
At the registration date of this Prospectus, the Company had no controlling shareholder
under the meaning of the provisions of Article L. 233-3 of the French Commercial code.
To the Company's knowledge, there is no concert agreement between shareholders and
no agreement whose implementation could bring about a change of control, it being
specified that the shareholders’ agreement signed by the Company's main shareholders
on 26 April 2012 will be automatically cancelled on the date of the initial listing of the
Company's shares on the regulated market of Euronext in Paris.
All of the 50,500, 5,000 and 50,000 convertible bonds issued at the general shareholders'
meetings held on 27 January, 21 February and 21 May 2014, respectively, for a total
principal amount of €10,550,000 plus capitalised interest at 4% per year, will be
converted into ordinary shares of the Company immediately prior to the initial listing of
the Company's shares, at the Offering Price less a discount of 25%, representing, on the
basis of the midpoint of the indicative range of the Offering Price, 748,524 shares and,
on the basis of the Company's share capital on the date of the Prospectus, an ex-ante
dilution of 9.49%, and 8.67% on an ex-post basis.
13
B.7
Selected key
financial
information
Summary consolidated statement of financial position
Consolidated information
(IFRS, in thousands of euros)
Non-current assets
2013
2012
23,210
20,014
Goodwill
5,219
5,360
Intangible assets
7,827
7,141
Property, plant & equipment
1,287
1,328
Other non-current financial assets
1,786
1,505
Deferred tax assets
5,460
3,941
11,435
25,434
4,597
18,269
34,645
45,448
10,511
23,108
Non-current liabilities
2,506
2,906
Interest-bearing loans
1,072
1,421
792
916
21,628
19,434
Current assets
Cash and cash equivalents
TOTAL ASSETS
Equity attributable to the Company’s owners
Other long-term liabilities
Current liabilities
2,473
560
Other current liabilities
8,129
9,176
34,645
45,448
TOTAL EQUITY AND LIABILITIES
Summary consolidated income statement
2013
2012
15,793
15,938
8,812
7,537
Marketing and Advertising Services
4,958
3,916
Other income
1,355
342
Revenues from operating activities
30,917
27,733
EBITDA
(8,261)
(3,655)
Current operating profit (loss)
(14,424)
(8,310)
Operating profit (loss)
(14,516)
(8,567)
Net financial income (loss)
Net profit (loss) for the year
(229)
(216)
(13,121)
(4,809)
Summary cash flow statement
2013
2012
Cash flow from operating activities
(8,817)
(963)
Net cash flow from investing activities
(6,325)
(3,675)
1,561
19,513
(13,581)
14,876
Net cash flow from (used in) financing activities
Change in net cash
14
Information per segment(1)
Consolidated
2013
(in thousands of euros)
VIADEO
2012
TIANJI
VIADEO
Inter-segment transactions
TIANJI
2013
GROUP TOTAL
2012
2013
2012
15 793
0
15 937
1
15 793
15 938
8 444
368
7 350
187
8 812
7 537
M arketing and advertising services
4 485
473
3 796
120
4 958
3 916
Other income
1 355
361
348
646
(361)
(652)
1 355
342
30 076
1 202
27 430
954
(361)
(652)
30 917
27 733
Revenue from operating activities
(19 729)
(3 444)
(16 821)
(2 578)
(23 174)
(19 399)
External marketing expenses
(3 649)
(1 764)
(1 992)
(1 097)
(5 413)
(3 089)
Other external expenses
(9 571)
(1 860)
(8 870)
(1 319)
422
(11 009)
(9 537)
479
-
645
(8)
(61)
(2 395)
(5 865)
393
(4 048)
-
Staff expenses
Other current expenses and operating income
EBITDA
Net financial profit (loss)
NET PROFIT (LOSS) FOR YEAR
652
-
418
637
(8 261)
(3 655)
(14 516)
(8 567)
(229)
(216)
(13 121)
(4 809)
(1) An operating segment is a component of the Group that engages in business activities from which it may
earn income and incur expenses, including income and expenses related to transactions with other components
of the Group. Each segment represents a Cash Management Unit ("CGU"). EBITDA per segment is regularly
reviewed by General Management to make decisions regarding the resources to be allocated to the segment
and to assess its performance. This information, regarding business activities associated with the Viadeo and
Tianji segments, is then analysed on the basis of the various service categories (subscriptions, recruitment and
training services, and marketing and advertising services).
The Group's base costs are covered in full by the Viadeo CGU. At the current stage of the Group's
development, management does not consider it useful to allocate these costs by CGU. Accordingly, there is no
management fee agreement between Viadeo and Tianji, and no division of these fees in the internal reporting
documents.
B.8
Selected key pro
forma financial
information
Not applicable
B.9
Profit forecast or
estimates
Not applicable
B.10
Reservations
with regards to
financial
information on
past years
Not applicable
B.11
Net working
capital
The Company states that, from its point of view, the Group has sufficient consolidated
net working capital (in other words, it has access to sufficient cash and liquidity) to meet
its current commitments for the next 12 months as from the date of approval (visa) of
this Prospectus.
This declaration is made before the completion of the capital increase described in this
securities note.
Section C – securities
C.1
Type, class and
identification
number of
shares offered
and/or listed for
trading
Admission to trading on the regulated market of Euronext in Paris is requested for the
following Company securities:

all shares comprising the share capital, namely 7,883,825 shares with a par value
of €0.02 per share, made up of 6,612,050 ordinary shares and 1,271,775 ordinary
shares arising from the conversion of 1,271,775 Series A preferred shares due to
15


be performed on the initial listing date of the Company's shares on the regulated
market of Euronext in Paris (the "Existing Shares"), including, based on the
midpoint of the indicative range of the Offering Price, a maximum of
125,127Existing Shares sold (increased to 139,029 shares based on the lower
limit of the indicative range of the Offering Price)by Karen Serfaty, Thierry
Lunati, Guillaume Olivier Doré, Jérôme Masurel, Damien Chalret du Rieu,
AviCorcos and Sacha Borantin (the "Initial Sold Shares"),which may be
increased to a maximum of 442,890 Existing Shares (or a maximum of 459,190
Existing Shares based on the lower limit of the indicative range of the Offering
Price) sold by Thierry Lunati, Dan Serfaty, Idinvest Partners, Ventech, Bpifrance
Participations, Financière WM, TMM consulting, Angyal, Global Internet
Ventures LLC and Saleh Al Hajaj (together with the above-named shareholders
the "Selling Shareholders") in the event of the full exercise of the Overallotment
Option (the "Additional Sold Shares"), together with the Initial Sold Shares, the
"Sold Shares";
1,716,982 new shares to be issued as part of a share capital increase in cash by
means of a public offering, which may be increased to a maximum of 1,995,383
new shares in the event of the full exercise of the Increase Option and based on
the lower limit of the indicative range of the Offering Price; and
831,691 shares based on the lower limit of the indicative range of the Offering
Price, resulting from the conversion of 105,500 convertible bonds immediately
prior to the initial listing of the Company's shares.
On the date on which they are admitted for trading, the Company's shares will be ordinary
Company shares, all of the same class.
Identification of the shares: trading in the form of promises of shares will take place
between 2 July and 4 July (inclusive) under the title "VIAD-promesses". From 5 July,
trading will take place under the name "VIAD".
ISIN code: FR0010325241
Mnemonic: VIAD
Compartment: [B]
Segment: 8299Z
ICB Classification: 9535 Internet
C.2
Issuance
currency:
Euro
C.3
Number of
shares
issued/Par value
of shares
Number of shares issued: 1,716,982 shares, which may be increased to a maximum of
1,993,298 shares in the event of the full exercise of the Increase Option and on the basis of
the midpoint of the indicative range of the Offering Price (the "New Shares", together
with the Sold Shares, the "Offered Shares").
Par value of shares: €0.02.
C.4
Rights attached
to securities
Under current French law and the Company's bylaws, the main rights attached to the
Existing Shares and New Shares are the following:

dividend entitlement;

voting rights, it being specified that the implementation of double voting rights is
expressly excluded by the Company's bylaws;

preferential subscription rights for securities of the same class; and

the right to share in any surplus in the event of liquidation.
16
C.5
Restrictions on
the free
transferability
of the securities
There is no provision in the Company's bylaws restricting the free transferability of shares
comprising the Company's share capital.
C.6
Existence of a
request for
admission to
trading on a
regulated
market
The admission of all Company shares is sought on the regulated market of Euronext in
Paris (Compartment B).
Dividend policy
No dividend was distributed in the last three fiscal years.
C.7
The trading conditions of all shares will be set in a Euronext notice, which should be
issued on 1 July 2014, according to the indicative schedule.
The New Shares and Existing Shares should be listed on the regulated market of Euronext
in Paris for the first time on 1 July 2014. With effect from [2 July] 2014 until the
scheduled settlement/delivery date of 4 July 2014 (inclusive), the New Shares will be
traded in the form of promises of shares on a listing line entitled "VIAD – promesses"
pursuant to the provisions of Article L. 228-10 of the French Commercial code. With
effect from 7 July 2014, the New Shares and Existing Shares will be traded on a single
listing line, "VIAD". Trading will be subject to the condition precedent of the issuance of
the depositary's certificate relating to the issuance of New Shares.
Given the stage of development of the Company, there are no plans to introduce a
dividend payment policy in the short term.
Section D – Risks
D.1
Main risks
specific to the
issuer or its
business sector
Before taking a decision to invest, investors are invited to take into consideration the
following risk factors:
Risks associated with the Group's activity and the implementation of its strategy:
fierce competition on the professional social network market; uncertainty regarding the
exact number of members on the Group's websites and the accuracy of their data;
uncertainty regarding the Group's ability to attract new customers and build the loyalty of
existing ones; risks associated with the multi-local strategy adopted by the Group
consisting of using two separate dedicated platforms for the Viadeo and Tianji networks
respectively and developing dedicated functionalities and applications for specific
countries and regions.
Technology risks: uncertainty regarding the Group's ability to adapt its current
technology and network infrastructure so that its websites remain continually accessible,
with acceptable loading times; risk of access to the Group's websites being restricted or
reduced by third parties (companies, groups or government authorities); risk of a
reduction in member activity if search engine methodologies are modified or the Group's
ranking on search engine results pages falls; risks associated with the modification of the
technical architecture of the Group's websites, particularly with respect to the transfer to
Viadeo's new technological platform; risks associated with the development of new
means of internet access; uncertainty regarding the Group's ability to block websites that
collect its data without permission; risks associated with security on the internet (viruses,
piracy, online payments).
Legal and regulatory risks: risks associated with the protection of personal data
collected by the Group; risks associated with the protection of privacy and personal image
rights; risks associated with intellectual property, particularly the Group's ability to
17
protect and enforce its intellectual property rights and business secrets and to maintain
control over its trademarks, domain names and ICP licences; risks associated with French
Act on the Confidence in the Digital Economy (loi pour la confiance dans l’économie
numérique); risk of the Group being held liable for an infringement to the intellectual
property rights of a third party; risks associated with online advertising and targeted
advertising; risks associated with the ownership of the Group's databases ; risks
associated with the diversity of laws and regulations applicable in the various foreign
countries in which the Group does business.
Risks associated with the Group's organisational structure: risks associated with the
Group's recent growth that may make it difficult to assess its future prospects; risks
associated with the Group's international expansion; uncertainty regarding the Group's
ability to keep its key employees and attract new qualified employees at the desired rate;
risks associated with managing the Group's growth and making acquisitions; risk
associated with the legal structure of the Tianji group, notably due to the contractual
control exercised by the Group over one of the companies of the Tianji group, Yingke,
whose share capital is held equally between two Chinese shareholders.
Financial risks: specific risks associated with projected losses and uncertain future
capital requirements and additional financing; foreign exchange risk; credit risk and risk
associated with cash management; risks associated with indebtedness, particularly the
interest rate risk; risks associated with the loss of public funding and the research tax
credit from which the Company benefits; uncertainty regarding the possible future use of
loss carryovers accumulated by the Group; risk of dilution related to the founders'
warrants (BSPCE) whose exercise in full would enable the subscription of 1,427,900 new
shares, generating, as at the date of the Prospectus, a dilution of 15.33%, on a fully diluted
basis of the share capital, and 18.11% on the basis of the current share capital, to which
the dilution resulting from the conversion of bonds must be added.
D.3
Main risks
specific to
shares issued
The risks associated with the Offering (as defined below) take into account the following:
 the Company's shares have never been traded on a financial market and are
subject to market fluctuations. Moreover, a liquid market may not develop or
last;
 the market price of the Company's shares is liable to be affected by substantial
volatility;
 the sale by main shareholders of a large number of shares upon expiry of the
lock-up period to which they have committed may have an adverse impact on the
market price of the Company's shares;
 the Offering will be cancelled if the Underwriting Agreement (as defined below)
is not signed or is terminated;
 if the total number of orders received do not amount to (i) at least 75% of the
amount of the issuance initially planned, or subscriptions for a minimum of
1,287,737 New Shares),and/or (ii) the total number of Initial Sold Shares, the
Offering will be cancelled and the subscription and purchase orders will be void;
 the Company does not intend to adopt a dividend payment policy in the short
term, given its current stage of development.
Section E – Offering
E.1
Total
amount of
proceeds
from the
Offering and
Issuance of New Shares
Gross proceeds from the issuance of New Shares
Approximately €32.6 million, which may be increased to approximately €37.9 million in the
event of the full exercise of the Increase Option, based on a price at the midpoint of the
18
estimate of
total
expenses
associated
with the
Offering.
indicative range of the Offering Price, i.e. €19.00.
Approximately €22.02 million, in the event of the reduction of the issuance to 75% of the
amount initially planned, based on the lower limit of the indicative range of the Offering Price.
Net estimated proceeds from the issuance of New Shares
Approximately €29.8 million, which may be increased to approximately €34.8 million in the
event of the full exercise of the Increase Option, based on a price at the midpoint of the
indicative range of the Offering Price, i.e. €19.00.
The expenses associated with the Offering borne by the Company are estimated at
approximately €2.9 million, if the Increase Option and Overallotment Option are not exercised,
based on a price at the midpoint of the indicative range of the Offering Price, i.e. €19.00.
Approximately €19.63 million, in the event of the reduction of the issuance to 75% of the
amount initially planned, based on the lower limit of the indicative range of the Offering Price.
Sale of Sold Shares
Gross proceeds from the sale of Sold Shares attributable to Selling Shareholders
Approximately €2.4 million, which may increase to €8.4 million if the Overallotment Option is
exercised in full, based on a price at the midpoint of the indicative range of the Offering Price,
i.e., €19.00.
Should demand prove to be insufficient, the share capital increase planned under the Offering
may be limited to the subscriptions received, provided that these reach at least 75% of the
amount of the issue initially planned.
If the total number of orders received does not cover (i) a minimum of 75% of the amount of the
issuance originally planned, i.e. the subscription of a minimum of 1,287,737 New Shares
(representing a gross minimum amount of approximately €22.02 million based on the lower
limit of the indicative range of the Offering Price) and/or (ii) all the Initial Sold Shares, the
Offering will be cancelled and subscription or purchase orders will be void.
E.2a
Reasons for
the Offering
and intended
use of the
proceeds of
the issuance
of the New
Shares
The issuance of the New Shares is intended to provide the Company with additional resources
to finance its operations (including its working capital requirement) and the growth of the
Group via the following strategic policies in order of priority:
1) in the first instance, strengthening the sales force in France and in China, via a policy
of direct recruitment or via the acquisition of job boards, particularly in China, giving
access to existing sales forces (approximately 70% of the funds raised);
2) then, investment of a technological nature relating to enhancement of the platform, the
content of the offer and the development of mobile technology. These investments may
be via internal developments or via the acquisition of targeted technologies through
external growth (approximately 30% of the funds raised);.
In the event of insufficient subscriptions, any reduction in the issuance to no less than 75% of
the amount originally envisaged would not have significant impact on the allocation of the
funds raised.
As at the date of the Prospectus, there is no acquisition project underway to which the Company
is committed.
E.3
Terms and
conditions of
the Offering
Nature and number of securities for which admission to trading is sought and the securities
offered
The Company's shares for which admission to trading is sought are:

the 7,883,825 Existing Shares;
19

a maximum of 1,995,383 New Shares, in the event of the full exercise of the Increase
Option and based on the lower limit of the indicative range of the Offering Price; and

831,691 shares based on the lower limit of the indicative range of the Offering Price,
resulting from the conversion of 105,500 convertible bonds immediately prior to the
initial listing of the Company's shares.
Type and number of securities offered
The Offering (as defined below), on the basis of the midpoint of the indicative range of the
Offering Price, covers:

125,127 Initial Sold Shares and 317,763 Additional Sold Shares (in the event of the full
exercise of the Overallotment Option); and

a maximum of 1,993,298 New Shares, in the event of the full exercise of the Increase
Option.
Increase Option
Depending on the demand, the initial number of New Shares may be increased by a maximum
of 15% of the cumulative number of New Shares and Initial Sold Shares, namely a maximum of
276,316 new shares, based on the lower limit of the indicative range of the Offering Price(the
"Increase Option").
Overallotment Option
Some Selling Shareholders will grant to the Underwriters an overallotment option (the
“Overallotment Option”), allowing the acquisition of a number of shares representing a
maximum of15% of the cumulative number of Sold Shares and New Shares (after full exercise
of the Increase Option), namely, based on the midpoint of the indicative range of the Offering
Price, a maximum of 317,763existing shares (the "Additional Sold Shares”).
The Overallotment Option will be exercisable by the Joint Lead Managers and Joint
Bookrunners in the name of and on behalf of the Underwriters between 1 July and 31 July 2014.
Offering structure
The Offered Shares will be distributed as part of a global offering (the "Offering"), comprising:


a public offering in France made in the form of an open price offering, primarily aimed
at individuals (the "Open Price Offering" or "OPO"), it being specified that:

the orders will be split according to the number of securities requested: order
portion A1 (between 1 and 100shares inclusive) and order portion A2 (more
than 100 shares),

where all orders may not be fully satisfied, the A1 order portions will receive
preferential treatment compared to the A2 order portions;
a global placement aimed primarily at institutional investors (including investors who
acquire these shares for a total price of at least €50.000 per investor or at least
€100.000 if the Member State has transposed the amending prospectus directive) in
France and certain other countries (with the exception notably of the United States)
(the "Global Placement").
Should the demand expressed under the OPO permit, the number of Offered Shares allocated in
response to orders issued under said OPO will be 10% or more of the Offered Shares. If the
demand expressed under the OPO is less than 10% of the Offered Shares, the balance not
allocated under the OPO will be offered under the Global Placement.
20
Indicative price range
The price of shares offered under the OPO will be the same as the price of shares offered under
the Global Placement (the "Offering Price").
The indicative price range is between €17.10 and €20.90per share.
The Offering Price may be set outside of this range.
In the event that the upper limit of the range is increased or the Offering Price is set above the
upper limit of the (original or modified) range, the ОРО closing date will be set so that there are
at least two trading days between the date on which the press release notifying the modification
is issued and the new closing date of the OPO. Orders issued under the ОРО prior to the
publication of the aforementioned press release will be upheld unless expressly revoked prior to,
or on, the new OPO closing date.
The Offering Price may be freely set below the lower limit of the indicative price range
(provided that there is no significant impact on the other characteristics of the Offering).
Methods used to set the Offering Price
The Offering Price will be set on 1 July 2014 according to the indicative timetable. It will be
calculated by comparing the share offering under the Global Placement and demand from
investors, using the so-called "bookbuilding" technique as developed by professional practice.
Entitlement date
1 January2014.
Subscription undertakings
As far as the Company is aware, no person intends to place a subscription order in excess of
5%.
Underwriting Agreement
The Offering will be the subject of an underwriting agreement (the "Underwriting
Agreement") between the Company and Jefferies International Limited and Société Générale
Corporate & Investment Banking, in their capacity as Joint Lead Managers and Joint
Bookrunners (the "Joint Lead Managers and Joint Bookrunners"), and Oddo&Cie in its
capacity as Co-Lead Manager (together with the Joint Lead Managers and Joint Bookrunners,
the "Underwriters") acting together but not jointly and severally.
The Underwriting Agreement will be signed on the day on which the Offering Price is set (i.e.
in accordance with the indicative timetable, 1 July 2014), it being specified that in the event that
the Underwriting Agreement is not signed, the initial public offering operation and the Offering
will be retroactively cancelled.
The Underwriting Agreement may be terminated by the Joint Lead Managers and Joint
Bookrunners up to (and including) the settlement/delivery date of the Offering, under certain
conditions and in certain circumstances, notably in the event of major events (such as, in
particular, political, financial, economic, banking or monetary events, acts of war or terrorism,
military action or conflict) having or liable to have an effect that would make it impossible or
would or could seriously compromise the operation.
This agreement does not constitute a performance guarantee (garantie de bonne fin) within the
meaning of Article L. 225-145 of the French Commercial code.
Stabilisation
Operations aimed at stabilising or supporting the market price of the Company's shares on the
regulated market of Euronext in Paris may be carried out between [1 July] 2014 and [31 July]
2014 (inclusive) by Société Générale acting as a stabilisation agent in the name and on behalf of
21
the Underwriters.
Liquidity contract
A liquidity contract complying with the AMAFI Code of Conduct is to be implemented by the
Company following an initial period of stabilisation, for an initial 12-month term, renewable by
tacit agreement for periods of one year, to boost the liquidity of the Company's shares and
ensure the stability of their price on the regulated market of Euronext in Paris.
Indicative timetable of the operation
18 June 2014
-
Publication of the press release announcing the Offering
-
Euronext notice on the opening of the OPO
-
Opening of the OPO and the Global Placement
30 June 2014
-
Closing of the OPO at 17:00 (Paris time) for subscriptions made in person and at 20:00
(Paris time) for online subscriptions
1 July 2014
-
Closing of the Global Placement at 12.00 (Paris time)
-
Setting of the Offering Price
-
Signature of the Underwriting Agreement
-
Publication of the press release stating the Offering Price, the final number of Offered
Shares and the results of the Offering
-
Euronext notice in relation to the results of the Offering
-
Beginning of stabilisation period (if applicable)
2 July 2014
-
Beginning of trading of the New Shares in the form of promises of shares (until 4 July
2014 inclusive) and Existing Shares on the regulated market of Euronext in Paris
4 July 2014
-
Settlement/delivery of the OPO and the Global Placement
7 July 2014
-
Beginning of trading of Company shares on the regulated market of Euronext in Paris
31 July 2014
-
Expiry date of exercise of the Overallotment Option
-
End of the stabilisation period, if any.
Subscription terms and conditions
Those who wish to participate in the OPO must submit their orders to an accredited financial
intermediary in France by 30 June 2014 at 17.00 (Paris time) for the subscriptions made in
person and 20.00 (Paris time) for online subscriptions.
In order to be taken into account, orders submitted under the Global Placement must be received
by 1 July 2014 at 12.00 (Paris time) at the latest.
Financial establishments responsible for the initial public offering
22
Jefferies International Limited (holding 1.46% of the Company’s share capital since April 2012)
Société Générale Corporate & Investment Banking
Co-Lead Manager
Oddo&Cie
E.4
Interests,
including
conflicting
interests,
that may
significantly
influence the
Offering
The Underwriters and/or some of their affiliates have provided and/or may provide in the future,
various banking, financial, investment, business and other services to the Company, its affiliates
or shareholders or executives, in connection with which they have received, or may receive,
compensation.
E.5
Name of the
issuer and
lock-up
undertakings
Issuer
Viadeo
Company's abstention undertaking
With effect from the date on which the Underwriting Agreement is signed and for a period of
180 calendar days following the settlement/delivery date, subject to certain standard exceptions.
Lock-up undertaking of the founding directors
With effect from the Prospectus date and up to (i) 180 calendar days following the
settlement/delivery date of the Company shares for 100% of their shares and (ii) 360 days for
90% of their shares, in relation to the shares held on the day of the IPO, including shares for
which the right to subscribe was granted by founders’ warrants they hold, subject to some
standard exceptions.
Lock-up undertaking of the Company's main financial shareholders
With effect from the Prospectus date and up to (i) 180 calendar days following the
settlement/delivery date of the Company shares for 100% of their shares, (ii) 270 days for 66%
of their shares and (iii) 360 days for 33% of their shares, in relation to the shares held on the day
of the IPO, subject to some standard exceptions.
Lock-up undertaking of the Company's other main shareholders
With effect from the Prospectus date and up to 180 calendar days following the
settlement/delivery date of the Company shares for 100% of their shares, in relation to the
shares held on the day of the IPO, subject to certain standard exceptions, it being specified that
the investment fund managed by A Capital Management have made a similar undertaking for a
period of 540 days.
23
Names of
Number of
Maximum number of Sold
Number of shares held after the
Selling
shares held Number of
Shares as part of the Offering Offering and sale of all of the Sold
shares
Shareholders
prior to
(2)
Shares, after conversion of bonds
resulting from
the
(2)
the
Offering
conversion of
(1)
Number of
Following the Excluding the
Following the
bonds
Initial Sold exercise in full
exercise of
exercise in full of
immediately
Shares
of the
the
the Overallotment
prior to the
Overallotment Overallotmen
Option
Offering
Option
t Option
Karen Serfaty
358,925
Thierry Lunati
342,325
Guillaume
Olivier Doré
291,718
67,207
-
291,718
50,624
4,295
297,054
292,759
10,300
2,436
-
7,864
7,864
Jérôme Masurel
7,750
1,833
-
5,917
5,917
Damien Chalret
du Rieu
5,125
1,212
-
3,913
3,913
AviCorcos
5,125
1,212
-
3,913
3,913
Sacha Borantin
2,550
603
-
1,947
1,947
Dan Serfaty
25
5,353
-
4,295
5,378
1,083
Idinvest Partners
1,109,800
142,750
114,538
1,252,550
1,138,012
Ventech
970,875
35,687
28,634
1 006,562
977,928
Bpifrance
Participations
524,500
142,750
114,538
667,250
552,712
Financière WM
104,900
7,137
5,726
112,037
106,311
TMM consulting
47,800
3,568
2,863
51,368
48,505
Angyal
11,950
10,706
8,591
22 656
14,065
Global Internet
Ventures LLC
-
7,137
5,726
7,137
1,411
Saleh Al Hajaj
159,975
35,591
28,557
195,566
167,009
Total
3,661,925
396,032
317,763
3,932,830
3,615,067
5,353
125,127
(1) given the exercise of the call options granted by certain shareholders of the Company;
(2) on the basis of the midpoint of the indicative range of the Offering Price.
24
E.6
Amount and
percentage
of the
immediate
dilution
resulting
from the
Offering
Impact of the issuance of new shares on the Company's equity
Based on the Group’s consolidated equity, the total number of shares comprising the Company's
share capital at 31 December 2013(1), and a price equal to the midpoint of the indicative range of
the Offering Price (or the lower limit of the indicative range of the Offering Price in the event of
the reduction of the issuance to 75% of the amount initially planned), the equity per share,
before and after the Offering, would be as follows (net of legal and administrative expenses and
expenses for the overall remuneration of financial intermediaries (excluding the impact of any
tax savings)):
Share of shareholders' equity
(in euros)(1)
in Euros, consolidated (under IFRS)
Non-diluted
basis(2)
diluted basis
Before the issuance of New Shares
€1.33
€3.56
After the issuance of New Shares (excluding exercise of the
Increase Option)
€4.92
€5.57
After the issuance of New Shares (in the event of the exercise of the
Increase Option)
€5.27
€5.86
After the issuance of New Shares and after full exercise of the
Increase Option and the Overallotment Option
€5.26
€5.85
After the issuance of New Shares (75% of the issuance amount
initially planned)(4)
€4.08
€4.85
(3)
(1) Taking into consideration the 25-for-1 share split decided by the Company's general shareholders'
meeting held on 21 May 2014.
(2) Taking into consideration (except for the non-diluted basis before the issuance of New Shares) the
conversion of all convertible bonds on the basis of a price equivalent to the midpoint of the indicative range
of the Offering Price (except for the 75% reduction of the issuance amount initially planned, where the lower
limit is used), less a 25% discount upon listing.
(3) Assuming the conversion of all convertible bonds on the basis of a price equivalent to the midpoint of the
indicative range of the Offering Price (except for the 75% reduction of the issuance amount initially planned,
where the lower limit is used), less a 25% discount and the exercise of all founders' warrants (BSPCE).
(4) On the basis of an Offering Price equal to the lower limit of the indicative price range.
Amount and percentage of the dilution resulting from the issuance of the New Shares
The impact of the Offering on the equity interest of a shareholder with a 1% interest in the
Company's share capital on the date of the Prospectus, not subscribing for said Offering
(calculations made on the basis of the number of shares comprising the Company's share capital
on the Prospectus date(1)) would be as follows:
Shareholder's stake as a %(1)
As a %
Non-diluted
basis(2)
diluted
basis(3)
Before the issuance of New Shares
1.00
0.78
After the issuance of New Shares (excluding exercise of the Increase
Option)
0.76
0.67
After the issuance of New Shares (in the event of the exercise of the
Increase Option)
0.74
0.65
0.74
0.65
After the issuance of New Shares and after full exercise of the Increase
25
Option and the Overallotment Option
After the issuance of New Shares (75% of the issuance amount
initially planned)(4)
0.79
0.69
(1) Taking into consideration the 25-for-1 share split decided by the Company's general shareholders' meeting
held on 21 May 2014.
(2) Taking into consideration (except for the non-diluted basis before the issuance of New Shares) the conversion
of all convertible bonds on the basis of a price equivalent to the midpoint of the indicative range of the Offering
Price (except for the 75% reduction of the issuance amount initially planned, where the lower limit is used), less a
25% discount upon listing.
(3) Assuming the conversion of all convertible bonds on the basis of a price equivalent to the midpoint of the
indicative range of the Offering Price (except for the 75% reduction of the issuance amount initially planned,
where the lower limit is used), less a 25% discount and the exercise of all founders' warrants (BSPCE).
E.7
Expenses
invoiced to
the investor
by the issuer
Not applicable.
26
1
PERSONS RESPONSIBLE
1.1
Persons responsible for the Prospectus
Mr Dan SERFATY, co-founder, Chairman and Chief Executive Officer of the Company, and Mr Thierry
LUNATI, co-founder, Deputy Chief Executive Officer of the Company.
1.2
Declaration by the persons responsible for the Prospectus
"We hereby confirm, having exercised due diligence in this regard, that, to the best of our knowledge, the
information in this Prospectus is true and contains no material omission.”
Paris, 17 June 2014
Dan Serfaty
Chairman and Chief Executive Officer
1.3
Thierry Lunati
Deputy Chief Executive Officer
Persons responsible for the financial information
Mr Dan Serfaty
Address: 30 rue de la Victoire
75009 Paris
Telephone: +33 (0)1 75 44 31 24
Fax: +33 (0)1 42 93 22 56
E-mail address: [email protected]
Mr Jean-Paul Alves
Chief Financial Officer
75009 Paris
Telephone: +33 (0)1 75 44 31 24
Fax: +33 (0)1 42 93 22 56
27
2
RISK FACTORS CONNECTED TO THE OFFERING
In addition to the risk factors described in chapter 4 "Risk Factors"of the document de base, investors are strongly
encouraged to take into account the following factors and the other information included in this securities note
before deciding to invest in the Company's shares. Investing in the Company's shares entails risks. The material
risks identified by the Company at the date of the AMF's approval of the Prospectus are those described in the
document de base and below. The Group's business, financial position, results or prospects could be materially
affected by the realisation of one or more of these risks. In such an event, the market price of the Company's
shares could fall and the investor may lose all or part of the sums invested in Company shares. Other risks and
uncertainties may exist or emerge, which are unknown to the Company at the date of the AMF's approval of the
Prospectus or that the Company does not consider material at this date, with possible disruptions or adverse
impact on the Group's business, financial position, results or prospects and the market price of the Company's
shares.
2.1
The Company's shares have never been traded on a financial market and are subject
to market fluctuations.
Up until their admission to trading on the regulated market of Euronext in Paris ("Euronext Paris"), the
Company's shares have not been traded on any regulated market. The Offering Price is not indicative of the
performance of the market price of the Company shares following their admission to trading on Euronext Paris.
The market price that will be established following admission to trading of the Company's shares on Euronext
Paris may vary significantly from the Offering Price. Whilst the Company has requested that its shares be
admitted to trading on Euronext Paris, no guarantee can be given of the existence of a liquid market for the
shares, nor that such a market, if it develops, will last over time. Should no liquid market for the Company's
shares emerge, the shares' market price and the investors' ability to trade the shares under conditions that they
may deem satisfactory may be affected.
2.2
The market price of the Company's shares may be affected by significant volatility
The market price of the Company's shares may be materially impacted by a number of factors affecting the
Group, its competitors, or the general economic conditions and professional social network, recruitment or
online advertising sectors. In particular, the market price of the Company's shares may fluctuate significantly in
response to events such as:
-
changes in the financial results or outlook of the Group or its competitors from one period to another;
-
announcements by competitors or other companies with similar businesses and/or announcements
concerning the professional social network, recruitment or online advertising markets, including in
relation to the financial and operating performance of these companies;
-
adverse developments in the regulations applicable in the countries or markets where the Group
operates or to the Group itself;
-
announcements concerning changes to the Company's shareholding;
-
announcements regarding changes to the management team; and
-
announcements in relation to the scope of the Company's assets (acquisitions, disposals, etc.).
Moreover, stock markets are subject to significant fluctuations which are not always related to the results and
prospects of the listed companies. Such market fluctuations, as well as the economic environment, may thus also
have a material impact on the market price of the Company's shares.
28
2.3
The sale of a large number of Company shares by its main shareholders may have a
significant impact on the market price of the Company's shares
The current main shareholders of the Company (with a combined stake in excess of 94.40% of the share capital
prior to the Offering) will hold approximately 72.99% of the Company's capital after the Offering (under the
assumption that all Initial Sold Shares and Additional Sold Shares are sold as part of the Offering following the
full exercise of the Increase Option and Overallotment Option and based on the midpoint of the indicative price
range). The decision by these shareholders to sell all or part of their stake on the market after the expiry of their
lock-up undertaking (as described in section 7.3 of this securities note) or before its expiry should they be
released from this obligation, or the perception that such a sale is imminent, may have a significant adverse
impact on the price of the Company's shares.
2.4
The Offering will be cancelled if the Underwriting Agreement is not signed or is
terminated
The Underwriting Agreement might not be signed, or might be terminated after signature under certain
circumstances by the Joint Lead Managers and Joint Bookrunners at any time up to and including the Offering
settlement-delivery date (see section 5.4.3 of this securities note).
Should the Underwriting Agreement not be signed, the Company's listing and the Offering will be cancelled
retroactively.
In the event of termination of the Underwriting Agreement, any subscription or purchase orders under the
Offering will be cancelled retroactively. The OPO, the Global Placement, all of the subscription and purchase
orders submitted as part of these transactions and all trades executed up to and including the settlement-delivery
date will be cancelled retroactively and will have to be settled, with each investor being personally responsible
for any losses and, if applicable, any costs resulting from the cancellation.
If the Underwriting Agreement is not signed or is terminated, the Company's shares will not be admitted for
trading on Euronext. This information will be communicated in a press release published by the Company and a
notice released by Euronext Paris. In accordance with section 6801/2 of Euronext's harmonised market rules,
Euronext cannot be held liable for any loss incurred by any person that may arise from the withdrawal of the
Offering by the Company and the resulting cancellation of transactions.
2.5
Risks connected to insufficient share subscriptions and transfers and cancellation of
the Offering
In the event of insufficient demand, the share capital increase planned under the Offering may be limited to the
subscriptions received, provided that they reach at least 75% of the originally planned issuance amount.
If the total number of orders received does not cover (i) a minimum of 75% of the amount of the issuance
originally planned, i.e. subscription of a minimum of 1,287,737 New Shares (representing a gross minimum
amount of approximately €22.02 million based on the lower limit of the indicative range of the Offering Price)
and/or (ii) all the Initial Sold Shares, the Offering will be cancelled and subscription or purchase orders will be
null and void.
2.6
There are no plans to introduce a dividend payment policy in the short term given the
current stage of the Company's development
The Company has not paid any dividends during the last three fiscal years.
At the date of the Prospectus, given the stage of development of the Company, there are no plans to introduce a
dividend payment policy in the short term.
29
3
KEY INFORMATION
3.1
Net working capital statement
The Company certifies that, in its opinion, the Group has sufficient consolidated net working capital (in other
words, it has access to sufficient cash and liquidity resources) to meet its present requirements for the next 12
months as from the date of this Prospectus.
This declaration is made before the completion of the capital increase described in this Securities Note.
3.2
Shareholders' equity and net debt
The Group's consolidated shareholder's equity and net debt as of 31 March 2014, prepared under IFRS and in
accordance with ESMA (European Securities Market Authority) recommendations of March 2013
(ESMA/2013/319, section 127), is detailed below:
Shareholders' equity and net debt (in thousands of euros/unaudited)
31 March 2014
498
Total current debt
-
Guaranteed current debt
92
Secured current debt
406
Unguaranteed and unsecured current debt
Total non-current debt (excluding the current portion of long-term liabilities)
8,298
-
Guaranteed non-current debt
127
Secured non-current debt
8,171
Unguaranteed and unsecured non-current debt
10,511
Shareholder’s Equity (1)
110
Share capital
44,153
Share premium
-
Legal reserve
(33,752)
Retained earnings and other reserves
(1) Data taken from audited financial statements at 31 December 2013 not including the comprehensive income (loss) for the period from 1
January to 31 March 2014.
30
31 March 2014
Net debt (in thousands of euros/unaudited)
4,721
A - Cash
-
B - Cash equivalents
C - Trading securities
1,250
D - Liquidity (A+B+C)
5,971
E - Current financial receivables
-
F - Current bank debt
6
493
G - Current portion of non-current debt
-
H - Other current financial debt
499
I - Current financial debt (F+G+H)
(5,472)
J – Net current Financial Indebtedness (I-E-D)
K - Non-current bank debt
1,000
L - Bonds issued
7,265
33
M - Other non-current debt
N - Non current Financial Indebtedness (K+L+M)(a)
8,298
O - Net Financial Indebtedness (J+N)
2,826
(a)
As indicated in note 23.1 "Operating lease obligation" to the Group's annual consolidated financial statements presented in
chapter 20.1 "Consolidated accounts prepared in accordance with IFRS for the fiscal years ended 31 December 2013 and 2012" of
the document de base, the Group has also taken out non-cancellable operating leases.
The convertible bonds issued in January and February 2014 for a face value of €5.6 million have an impact the
Group's gross and net debt. They do not have any effect on equity (excluding profit/loss), given the
characteristics of the conversion option.
Please note that payment, in full, of a subscription price of €5million for convertible bonds in May 2014, resulted
in an increase of the same amount in cash and an increase in gross financial liabilities of €6.2 million (under
IFRS), leading to a net impact of €1.2 million on net consolidated financial liabilities under IFRS on the date of
their issuance.
Please also note that said convertible bonds will be converted into shares on the date of the initial listing of the
Company's shares.
Notwithstanding the above, no material change liable to affect the amount of net financial debt in the medium
and long term and the amount of equity occurred since 31 March 2014.
Furthermore, there is no indirect and contingent indebtedness.
3.3
Interest of individuals and legal entities taking part in the Offering
The Underwriters (as defined in section 5.4.3 of this securities note) and/or some of their affiliates have provided
and/or may provide in the future, various banking, financial, investment, business and other services to the
Company, its affiliates or shareholders or executives, for which they have received, or may receive,
compensation.
31
3.4
Reasons for the Offering and intended use of the net proceeds from the transaction
The issuance of the New Shares is intended to provide the Company with additional resources with which to
finance its operations (including its working capital requirement) and the growth of the Group via the following
strategic policies in order of priority:
1) in the first instance, strengthening the sales force in France and in China, via a policy of direct
recruitment or via the acquisition of job boards, particularly in China, giving access to existing sales
forces (approximately 70% of the funds raised);
2) then, investment of a technological nature relating to enhancement of the platform, the content of the
offer and the development of mobile technology, investments that may be via internal developments or
via the acquisition of targeted technologies through external growth (approximately 30% of the funds
raised);
In the event of insufficient subscriptions, any reduction in the issuance to 75% of the amount originally planned
would not materially impact the allocation of the funds raised.
As at the date of this Prospectus, there is no acquisition project underway to which the Company is committed.
32
INFORMATION ON THE SECURITIES TO BE OFFERED AND ADMITTED TO TRADING
4
4.1
Type, class and entitlement date of the shares offered and admitted to trading
Type and number of securities for admission to trading
Admission to trading on Euronext Paris (compartment B) is requested for the following Company securities:



all Existing Shares making up the share capital, namely 7,883,825 shares with a par value of €0.02
per share, including 6,612,050 ordinary shares and 1,271,775 shares from the conversion of
1,271,775 Series A preferred shares due to be performed on the initial listing date of the Company's
shares on Euronext Paris (hereafter the "Existing Shares"), including, based on the midpoint of the
indicative range of the Offering Price, a maximum of 125,127 Existing Shares (which may be
increased to 139,029 shares, based on the lower limit of the indicative range of the Offering
Price)sold by Karen Serfaty, Thierry Lunati, Guillaume Olivier Doré, Jérôme Masurel, Damien
Chalret du Rieu, AviCorcos and Sacha Borantin (the “Initial Sold Shares”) which may be increased
to a maximum of 442,890 additional Existing Shares (or 459,190 based on the lower limit of the price
range)sold by Thierry Lunati, Dan Serfaty, Idinvest Partners, Ventech, Bpifrance Participations,
Financière WM, TMM consulting, Angyal, Global Internet Ventures LLC and Saleh Al Hajaj
(together with the above-named shareholders, the "Selling Shareholders") in the event of the full
exercise of the Overallotment Option (the “Additional Sold Shares", together with the Initial Sold
Shares, the “Sold Shares”);
1,716,982new shares to be issued as part of a share capital increase in cash by means of a public
offering, which may be increased to a maximum of 1,995,383 new shares in the event of the full
exercise of the Increase Option and based on the lower limit of the indicative range of the Offering
Price; and
831,691 shares based on the lower limit of the indicative range of the Offering Price, resulting from
the conversion of 105,500 convertible bonds immediately prior to the initial listing of the Company's
shares.
The Offered Shares are ordinary shares of the Company.
Entitlement date
The 1,716,982 new shares to be issued as part of a share capital increase in cash by means of a public offering,
which may be increased to a maximum of 1,993,298 new shares in the event of the full exercise of the
Increase Option and on the basis of the midpoint of the range of price (the "New Shares", together with the
Sold Shares, the "Offered Shares") will be fungible with Existing Shares, from the issue date. Upon their
issuance, the Offered Shares shall be equivalent to Existing Shares. The entitlement date is 1 January 2014
(see section 4.5 of this securities note on dividend entitlements).
Share description
Viadeo
ISIN Code
FR0010325241
Mnemonic
VIAD
Compartment
Compartment B
Business segment
33
NAF Code: 8299Z
ICB classification: 9535 Internet
Trading of the shares
The initial listing date on Euronext Paris is 1 July 2014. Trading in the form of promises of shares takes place
from 2 July 2014 until 4 July 2014 (inclusive), in accordance with article 6.8 of Euronext's harmonised market
rules.
From 2 July until the settlement/delivery date of the New Shares, which is expected to be 4 July, trading will
take place under the conditions set forth in Article L. 228-10 of the French Commercial code, on a single
listing line, "VIAD - Promesses", and will be subject to the condition precedent of delivery of the depositary's
certificate confirming the subscription of the New Shares. As of 7 July 2014, all the Company's shares will be
traded on a single "VIAD" listing line.
4.2
Applicable law and competent courts
The Company's shares are governed by French law.
In the event of a dispute with the Company, the competent courts are those of the Company's registered office,
when the Company is the defendant. When the Company is the plaintiff, the competent courts are designated
according to the type of dispute, unless otherwise specifically provided to the contrary in the French Civil
Procedure code.
4.3
Form and method of registration of Company’s shares
The Company’s shares may either be held as registered shares or bearer shares, as requested by shareholders.
In accordance with article L. 211-3 of the French Monetary and Financial code, all shares must be registered in
the securities account, held by the Company or an authorised intermediary, depending on the chosen option.
Consequently, shareholders' rights will be represented by an entry in the securities account opened in the
shareholder's name in the books:

of CACEIS Corporate Trust (14 rue Rouget de Lisle, 92130 Issy-Les-Moulineaux, France), appointed
by the Company, for shares held in registered form ("forme nominative pure");

of an authorised intermediary of their choice and of CACEIS Corporate Trust, appointed by the
Company, for shares held in administered registered form ("forme nominative administrée");

or of an authorised intermediary of their own choice shares kept in bearer form ("forme au porteur").
In accordance with Articles L. 211-15 and L. 211-17 of the French Monetary and Financial code, shares are
transferred via account-to-account transfer, and title is transferred upon the registration of the shares in the
purchaser's securities account.
An application will be made for admission to Euroclear France for clearing transactions between account-holders
- custodians in respect of Company shares. An application will also be made for admission to the Euroclear Bank
S.A./N.V. system and Clearstream Banking, a Luxembourg law société anonyme.
According to the indicative timetable, the Company shares should be entered in the securities accounts as of 4
July 2014.
4.4
Currency
The Offering will be denominated in euros.
34
35
4.5
Rights attached to the shares
Shares will be governed by the stipulations of the bylaws adopted by the combined general shareholders' meeting
on 21 May 2014, under the non-retroactive condition precedent of the initial listing of the Company's shares on
Euronext Paris. Under current French law and the bylaws that will govern the Company on completion of the
listing, the main rights attached to the shares are described below:
Profits – Legal reserve - Dividend entitlements
Each share carries the right to a percentage of the Company's assets, profits and payment in dissolution in
proportion to the share of the capital it represents.
Five percent (5%) will be deducted from the profit for the period, less losses in prior years where applicable, to
constitute the legal reserve. Said deduction ceases to be mandatory when the legal reserve amounts to one-tenth
of the share capital; it resumes when for any reason whatsoever, the legal reserve falls below this fraction of onetenth.
The distributable profit comprises the profit for the fiscal year, less prior losses and the deduction provided for in
the paragraph above, plus any retained earnings.
The general shareholders' meeting called to approve the financial statements for the year may grant each
shareholder the option for all or part of the dividend or the interim dividend to be paid in cash or shares.
Dividends not claimed within five years of the payment date are forfeited and revert to the French State at the
end of this period.
Dividends paid to non-residents are subject to withholding tax in France (see section 4.11 of this securities note).
The Company's dividend distribution policy is described in section 20.7 of the document de base.
Preferential subscription right
The shares carry a preferential subscription right to share capital increases, unless this right is waived by the
shareholders. Proportionate to the value of their shares, shareholders have a preferential right to subscribe for
shares issued for cash to increase the capital immediately or in the future. This right is negotiable throughout the
subscription period, to the extent that the shares themselves are negotiable. When this is not the case, it is
transferable under the same conditions as the share itself. Shareholders may individually waive their preferential
rights (Articles L. 225-132 and L. 228-91 of the French Commercial code).
Voting right
The voting right attached to the shares is proportional to the percentage of share capital they represent. Each
share carries the right to one vote. There are no double voting right and any mechanism automatically conferring
a double voting right on shares which can be proven to have been registered for at least two years in the name of
the same shareholder is expressly excluded by the Company's bylaws.
Right to a share in the Company's profits
The Company's shareholders are entitled to share in the Company's profits under the conditions set forth in
Articles L. 232-10 et seq. of the French Commercial code.
Right to a share in any surplus in the event of liquidation
Each share carries the right to an identical percentage of the Company's assets, profits and payment in
dissolution, subject to the creation of preferred shares.
Buyback or conversion clauses
The Company's bylaws do not include a buyback or conversion clause for ordinary shares.
36
Identification of holders of securities
The Company is informed about its shareholding structure in accordance with legal requirements. Accordingly, it
may use all legal provisions necessary to identify the holders of its securities conferring the right to vote at
shareholders' meetings immediately or in the future.
4.6
4.6.1
Authorisations
General shareholders’ meeting of the Company that authorised the issuance
The issuance of New Shares was authorised by the combined general shareholders' meeting on 21 May 2014 in
its thirtieth resolution. The text of the resolution is as follows:
Thirtieth resolution
Delegation of authority granted to the board of directors with a view to increasing the share capital through the
issuance of ordinary shares or any securities giving access to share capital with cancellation of shareholders'
preferential subscription rights and public offering
The general shareholders’ meeting, acting under the conditions of quorum and majority required for
extraordinary general meetings,
after having reviewed the board of directors' report and the statutory auditors' special report,
in accordance with the provisions of Articles L. 225-129 to L. 225-129-6, L. 225-135 et seq. of the French
Commercial code, and, in particular, Articles L. 225-136, L. 228-91 and L. 228-92 of said code,
authorises the board of directors to decide to issue, by public offering, on one or more occasions, in the
proportions and at the times of its choosing, in France or abroad, in euros, in foreign currencies or in any
monetary unit whatever established by reference to a basket of currencies, free of charge or for valuable
consideration, ordinary shares of the Company, as well as any and all transferable securities giving access to
ordinary shares of the Company, by any means, immediately and/or in the future, said shares conferring the same
rights as former shares, subject to their entitlement date,
specifies as needed that the issuance of preferred shares is expressly excluded from this authorisation,
decides that the securities thus issued may consist of debt securities, be linked to the issuance of such securities
or allow their issuance as intermediate securities ("titres intermédiaires"),
decides to cancel shareholders' preferential subscription rights to ordinary shares or transferable securities issued
by virtue of this authorisation, while allowing the board the option to institute a priority subscription right to the
benefit of the shareholders, on all of part of the issuance, during the time period and according to the terms and
conditions it shall decide, pursuant to Article L. 225-135 of the French Commercial code. However, this priority
right shall not give rise to the creation of negotiable rights, but it can be exercised irrevocably or revocably,
duly acknowledges that this authorisation automatically entails, in favour of shareholders of any securities that
may have been issued pursuant to this delegation, express waiver by the shareholders of their preferential right to
subscribe to the shares to which said securities carry rights,
decides that the total nominal amount of share capital increases liable to be completed immediately and/or in the
future by virtue of this authorisation may not exceed €140,000, plus, where applicable, the amount of additional
shares to be issued to protect the rights of holders of securities and other entitlements giving access to capital, in
accordance with law and regulations, and, as required, with applicable contractual stipulations,
decides furthermore that the nominal amount of any capital increase that may be completed pursuant to this
resolution shall be included in the overall aggregate maximum specified in the thirty-sixth resolution below,
37
decides that the total nominal amount of securities representing debt and giving access to the Company's capital
that may be issued shall not be greater than €50 million (or the counter value of this amount in the case of
issuance in another currency),
decides furthermore that the nominal amount of any issuance of securities representative of debt and giving
access to the Company's share capital that may be completed pursuant to this resolution shall be included in the
overall aggregate maximum specified in the thirty-sixth resolution below,
decides that if the issuance is under-subscribed, the board may use one or other of the following options, in the
order of its choosing:
-
limit the issuance to the amount of the subscriptions, provided that they are equal to at least threequarters of the initial issuance amount,
-
freely distribute all or part of the unsubscribed securities between the persons of its choice, and
-
offer to the public, in the French or international market, all or part of the unsubscribed securities,
decides that the issuance price of the shares and securities, which may be issued by virtue of this authorisation,
shall be set by the board as follows:
-
as regards the capital increase to be completed upon the occasion of the initial public offering of the
Company's shares on the regulated market of Euronext in Paris, the subscription price of one new share
will be calculated by matching the shares offered with subscription orders placed by investors using the
bookbuilding technique,
-
subsequent to the initial public offering of the Company's shares on the regulated market of Euronext in
Paris, the issuance price will be no less than the weighted average of the price on the three trading days
prior to the setting of said issuance price less, where appropriate, the legally authorised maximum
discount (currently 5%) corrected for any difference in dividend date, given that the issuance price of
securities giving access to share capital will be such that the amount immediately received by the
Company plus, where appropriate, the amount likely to be received by it at a later date, for each share
issued as a result of the issuance of such securities, will be no less than the issuance price defined
above,
states that the authorisation thus granted to the board of directors is valid for twenty-six months from the date of
this meeting,
decides that the board shall have full powers, with the option of sub-delegating in accordance with the law, to
implement this authorisation, under the conditions set by law and the bylaws, and in particular:
-
to decide the dates, conditions and terms for all issues, as well as the form and characteristics of the
shares or securities giving access to share capital to be issued, with or without a premium,
-
to set the issuance amounts, the entitlement date, which may be retroactive, of the shares or securities
giving access to the capital to be issued, the method of payment, as well as, where applicable, the
methods for exercising the rights to trade, convert, redeem or allocate in any other manner the equity
securities or securities giving access to share capital,
-
to proceed to all adjustments required pursuant to law and regulations and, where applicable, all
adjustments to applicable contract stipulations in order to protect the rights of the holders of securities
giving access to the Company's share capital, and
-
to suspend, if applicable, the exercise of the rights attaching to these securities for a maximum period of
three months,
38
decides that the board may:
-
at its sole discretion and at the time it deems appropriate, offset the charges and fees incurred for the
share capital increases completed by virtue of the authorisation granted in this resolution against the
premiums related thereto and deduct the sums required to bring the legal reserve to one-tenth of the new
share capital, after each such transaction, from these premiums,
-
make all decisions required to have the securities thus issued listed on the regulated market of Euronext
in Paris and, in general,
-
take all steps, enter into all agreements and carry out all administrative procedures required for the
successful completion of the proposed issuance, and the definitive completion of the resulting capital
increase and amend the bylaws accordingly.
4.6.2
The Company's board of directors having decided on the principle of the issuance
By virtue of the delegation of authority referred to in section 4.6.1 above, the board of directors, meeting on 16
June 2014:

decided on the principle of a cash capital increase for a nominal amount of €34,339.64 by the issuance,
with cancellation of preferential subscription rights, by means of a public offering and without priority
rights, of a maximum of 1,716,982 New Shares with a par value of €0.02 per share, which number may
be increased to a maximum of 1,995,383 New Shares, said increase to be determined by decision of the
board of directors on the date of the setting of the definitive terms of the Offering, to increase the
number of New Shares by a maximum of 15% (278.401 shares) of the number initially set, by
exercising the Overallotment Option (see section 5.2.5 of this securities note);

sets the indicative issuance range of the issuance price for the New Shares at between €17.10 and
€20.90 per share. It is specified that this range is subject to change under the conditions stipulated in
section 5.3.2.3 of this securities note;
The final terms and conditions of these share capital increases, notably the Offering Price and the number of
the New Shares, will be decided by the Company's board of directors at its meeting, which, according to the
indicative timetable, is due to be held on 1 July 2014.
4.6.3
Selling Shareholders
At the same time as the issuance of a maximum of 1,993,298 New Shares, based on the midpoint of the
indicative range of the Offering Price, Karen Serfaty, Thierry Lunati, Guillaume Olivier Doré, Jérôme Masurel,
Damien Chalret du Rieu, AviCorcos and Sacha Borantin will proceed with the sale of up to a maximum of
125,127 Existing Shares, representing approximately 1.59% of the Company's share capital and voting rights
(number which may be increased to 139,029 based on the lower limit of the indicative range of the Offering
Price), prior to the operation being carried out, for the sole purpose of enabling the funding of the exercise of
options granted to them by the Company's shareholders, in the amount of €2,377,344.20,(see section 5.3.4 of this
securities note for a description) and related taxes. The proceeds of the sale of the said Initial Sold Shares, net of
taxes, are intended to be invested in Company shares.
Moreover, some Selling Shareholders will grant the Underwriters an Overallotment Option allowing the
acquisition of a number of Additional Sold Shares, accounting for no more than 15% of the number of shares
that will actually be offered as part of the Offering, after possibly applying the Increase Option, giving, based on
the midpoint of the indicative range of the Offering Price, a maximum of 317,763 Additional Sold Shares (see
section 5.2.5 of this securities note).
The New Shares and Sold Shares will be offered at the same time and under the same conditions as part of the
Offering. Only New Shares will be allocated to investors under the Open Price Offering.
39
By way of illustration, the table below shows the maximum number of shares that may be sold by the Selling
Shareholders, as well as their interest in the Company's share capital before and after the Offering, based on the
mid-point of the indicative range of the Offering Price, or €19.00:
Names of
Selling
Shareholders
Number
Maximum number of Sold
Number of shares held after the
Number of
of shares
Shares as part of the Offering Offering and sale of all of the Sold
shares
held prior resulting from
(2)
Shares, after conversion of
to the
convertible bonds (2)
the
Offering conversion of
(1)
convertible
Number of
Following the Excluding the
Following the
bonds
Initial Sold exercise in full
exercise of
exercise in full of
immediately
Shares
of the
the
the Overallotment
prior to the
Overallotment Overallotmen
Option
Offering
Option
t Option
Karen Serfaty
358,925
Thierry Lunati
342,325
Guillaume
Olivier Doré
291,718
67,207
-
291,718
50,624
4,295
297,054
292,759
10,300
2,436
-
7,864
7,864
Jérôme
Masurel
7,750
1,833
-
5,917
5,917
Damien
Chalret du
Rieu
5,125
1,212
-
3,913
3,913
AviCorcos
5,125
1,212
-
3,913
3,913
Sacha Borantin
2,550
603
-
1,947
1,947
Dan Serfaty
25
5,353
-
4,295
5,378
1,083
Idinvest
Partners
1,109,800
142,750
114,538
1,252,550
1,138,012
Ventech
970,875
35,687
28,634
1 006,562
977,928
Bpifrance
Participations
524,500
142,750
114,538
667,250
552,712
Financière
WM
104,900
7,137
5,726
112,037
106,311
TMM
consulting
47,800
3,568
2,863
51,368
48,505
Angyal
11,950
10,706
8,591
22 656
14,065
Global Internet
Ventures LLC
-
7,137
5,726
7,137
1,411
Saleh Al Hajaj
159,975
35,591
28,557
195,566
167,009
Total
3,661,925
396,032
317,763
3,932,830
3,615,067
5,353
-
-
125,127
(1) given the exercise of the call options granted by certain shareholders of the Company;
(2) on the basis of the midpoint of the indicative range of the Offering Price.
40
The Sold Shares are ordinary shares with a par value of €0.02 per share, fully subscribed and paid up and all of
the same class.
4.7
Scheduled settlement/delivery date
The scheduled settlement/delivery date of the Offered Shares is 4 July 2014, according to the indicative
timetable given in section 5.1.1 of this securities note.
4.8
Restrictions on free trading in the Company's shares
There are no clauses restricting the free trading of the shares comprising the Company's share capital.
Please see section 7.3 of this securities note for a detailed description of undertakings given by the Company and
a number of its shareholders.
4.9
French regulations governing tender offers
As from the date on which the shares of the Company are admitted to trading on Euronext Paris, the Company
shall be subject to the laws and regulations in force in France relating to mandatory tender offers, public buyback
tender offers and squeeze-outs.
4.9.1
Mandatory tender offers
Article L. 433-3 of the French Monetary and Financial code and Articles 234-1 et seq. of the AMF General
Regulations set the conditions for the mandatory filing of a tender offer, under conditions such that it may be
deemed compliant by the AMF, relating to all the equity securities and securities giving access to the capital or to
voting rights of a company whose shares are admitted to trading on a regulated market.
4.9.2
Buyback tender offers and squeeze-outs
Article L. 433-4 of the French Monetary and Financial Code and Articles 236-1 et seq. (public buyback tender
offer), 237-1 et seq. (squeeze-out following a public buyback tender offer), and 237-14 et seq. (squeeze-out
following any tender offer) of the AMF General Regulations set the conditions for filing of a buyback tender
offer or implementation of squeeze-out of the minority shareholders of a company whose shares are admitted to
trading on a regulated market.
4.10
Tender offers on the Company's share capital initiated by third parties during the
prior fiscal year and the current fiscal year
Since none of the Company's securities are admitted for trading on a regulated market as at the date of the
Prospectus, no tender offer was initiated by any third party on the Company's capital during the prior or current
fiscal years.
4.11
Withholding tax on dividends paid to non-French tax residents
Under current French law and subject to the possible application of international tax treaties, this section
summarises the consequences under French tax law that may apply to investors who are not French tax residents
and who are in receipt of dividends from the shares they hold in the Company other than through a fixed base or
stable establishment in France.
They should nevertheless refer to their usual tax adviser for information on the taxation that applies to their
particular case. Non-French tax residents must also comply with the tax laws in their country of residence.
41
In principle, dividends paid by the Company are subject to withholding at source, deducted by the bank paying
the dividends, when the beneficiary's effective tax residence or registered office is outside France. Subject to the
information stated hereafter, the withholding rate is set at (i) 21% when the beneficiary is an individual resident
in a member state of the European Union, or in a state that is a signatory to the European Economic Area
Agreement that has concluded an administrative assistance agreement with France for the prevention of fraud
and tax evasion and at (ii) 30% in all other cases (subject to the following).
This withholding may be reduced or eliminated, pursuant to international tax treaties. Shareholders are also
requested to take note of the practical methods of application of international tax treaties, notably as in the
French government authoritative literature (BOI-INT-DG-20-20-20-20-20120912) relative to "normal" or
"simplified" procedures for the reduction of or exemption from withholdings at source.
Moreover:

subject to fulfilling the criteria of French government authoritative literature (BOI-IS-CHAMP-10-5010-40-20120912, No. 580 et seq.), non-profit organisations whose registered office is located (i) in a
member state of the European Union, or (ii) in a state that is a signatory to the European Economic Area
Agreement that has concluded an administrative assistance agreement with France for the prevention of
fraud and tax evasion, may be eligible for the reduced withholding rate of 15%;

subject to fulfilling the criteria of Article 119 ter of the French General Tax code, as interpreted in
French government authoritative literature (BOI-RPPM-RCM-30-30-20-40-20120912), legal entities
that come to hold at least 5% of the Company's share capital and voting rights may be eligible for an
exemption from the withholding tax if their effective management headquarters is located (i) in a
member state of the European Union, or (ii) in a state that is a signatory to the European Economic Area
Agreement that has concluded an administrative assistance agreement with France for the prevention of
fraud and tax evasion. It is recommended that the shareholders in question consult their tax advisers to
determine to what extent and under which conditions they may be eligible for the exemption.
Nevertheless, the dividends distributed by the Company shall be subject to a 75% withholding, regardless of the
shareholder's tax residence (subject, where applicable, to more favourable provisions of international treaties) if
they are paid or deemed paid outside France in a state or territory classed as non-cooperative under the meaning
of Article 238-0 of the French General Tax code. The list of non-cooperative states and territories is published by
ministerial order and updated every year.
It is the responsibility of the shareholders concerned to refer to their usual tax adviser to determine if the new
legislation relative to non-cooperative states and territories applies to them and/or if they are eligible for a
reduction of or exemption from the withholding tax.
4.12
Special system applicable to personal equity plans ("PEA")
For investors who are French tax residents, ordinary shares of the Company are eligible for PEAs. The cap on
payments into a PEA is €150,000 (and €300,000 for a couple).
Under certain conditions, the PEA grants entitlement:

for the term of the PEA, to exemption from income tax and social security payments on net capital
gains generated by investments made in the framework of the plan, provided notably that such capital
gains are retained in the PEA; and

when the PEA is closed (if the date of closure is more than five years after the start of the plan) or on
the occasion of a partial withdrawal (if this is more than eight years after the start of the plan), to a tax
exemption on the net capital gains since the start of the plan. However, these gains remain subject to
42
social security and additional contributions, CSG (general social charge) and CRDS (contribution to the
reduction of the national debt) at the total rate of 15.5%.
In principle, losses on shares held in a PEA are only attributable to the capital gains made (specific rules apply to
some cases of closing a PEA). It is recommended that investors contact their tax adviser in this regard.
If they do not meet the exemption requirements, capital gains on the sale of investments made in the framework
of a personal equity plan (PEA) are taxable (i) when the sale takes place within two years of opening the PEA, at
a rate of 22.5% (article 200A of the French General Tax Code), (ii) when the sale takes place between two and
five years after opening the PEA, at 19%, plus, in any event, the social security deductions referred to above, at
the overall rate of 15.5%.
The French 2014 Budget Act (loi de finances) created a new category of personal equity plan (PEA), known as a
"PME-ETI", with the same tax advantages as the PEA. Eligible securities must have been issued by a company
that employs less than 5,000 people and with annual revenue of not more than €1.5 billion, or a total balance
sheet of not more than €2 billion. An implementing decree (No. 2014-283) specifying these conditions was
published on 5 March 2014. The cap on payments into the plan is €75,000 (and €150,000 for a couple). "PMEETIs" may be held cumulatively with a PEA under ordinary law, and taxpayers may only hold one “PME-ETI
plan” each.
The Company's shares are eligible for the "PME-ETI" PEA.
43
TERMS OF THE OFFERING
5
5.1
Terms of the Offering, indicative timetable and subscription procedures
Terms of the Offering
5.1.1
Based on the midpoint of the indicative range of the Offering Price , the Offering (as described below) will
involve the market offering of 125,127 Initial Sold Shares and 1,716,982 New Shares, which may be increased to
a maximum of 1,993,298 New Shares, in the event of the full exercise of the Increase Option.
Plans have been made to distribute the Offered Shares as part of a global offering (the "Offering"), comprising:

a public offering in France made in the form of an open price offering, primarily aimed at individuals (the
"Open Price Offering" or "OPO") ;

A global placement primarily aimed at institutional investors (the "Global Placement") comprising:

a placement in France; and

an international private placement in certain countries excluding, in particular, the United States of
America.
In France, the shares will be distributed to the public in accordance with Articles P 1.2.1 et seq. of the Euronext
Rule Book II relating to particular rules applicable to French regulated markets. The Offered Shares will be
divided between the Global Placement, on the one hand, and the OPO, on the other, in line with the nature and
extent of the demand, in accordance with the principles laid down by Article 315-35 of the AMF General
Regulations. Should the demand expressed under the OPO permit, the number of shares allotted in response to
orders issued under said OPO will be 10% or more of the Offered Shares. If the demand expressed under the
OPO is less than 10% of the Offered Shares, the balance of the Offered Shares not allocated under the OPO will
be offered under the Global Placement.
Depending on the extent of the demand expressed under the Offering, the initial number of New Shares may be
increased by a maximum of 15% of the cumulative number of New Shares and Initial Sold Shares, i.e., based on
the midpoint of the indicative range of the Offering Price , a maximum of 276,316 shares (the "Increase
Option"). Any implementation of the Increase Option will be decided by the board of directors, which will set
the definitive terms of the Offering, according to the indicative timetable, on 1 July 2014.
Some Selling Shareholders will grant the Underwriters an Overallotment Option (as described in section 5.2.6 of
this securities note) allowing the acquisition of a number of existing shares accounting for no more than 15% of
the cumulative number of Sold Shares and New Shares (after the exercise in full of the Increase Option), i.e.,
based on the midpoint of the indicative range of the Offering Price, a maximum of 317,763 existing shares. The
Overallotment Option may be exercised from 1 July to 31 July 2014.
44
Indicative timetable
18 June 2014
Publication of the press release announcing the Offering
Euronext notice in relation to the opening of the OPO
Opening of the OPO and the Global Placement
30 June 2014
Closing of the OPO at 17:00 (Paris time) for subscriptions made in person and at
20:00 (Paris time) for online subscriptions.
1 July 2014
Closing of the Global Placement at 12:00 (Paris time)
Signing of the Underwriting Agreement
Setting of the Offering Price
Publication of the press release stating the Offering Price, the final number of
Offered Shares and the results of the Offering
Euronext notice in relation to the results of the Offering
Beginning of any possible stabilisation period
2 July 2014
Beginning of trading of the New Shares in the form of promises of shares (until4
July 2014, inclusive) and of Existing Shares on the regulated market of Euronext
in Paris
4 July 2014
Settlement/delivery of the OPO and the Global Placement
7 July 2014
Beginning of trading of Company shares on Euronext Paris
31 July 2014
Deadline for the exercise of the Overallotment Option
End of the stabilisation period, as the case may be.
5.1.2
Offering amount
See chapter 8 "Offering-related Expenses" of this securities note.
5.1.3
Offering procedure and period
5.1.3.1
Main characteristics of the Open Price Offering
Duration of the OPO
The OPO will begin on 18 June 2014and will end on 30 June 2014 at 17:00 (Paris time) for subscriptions made
in person and at 20:00 (Paris time) for online subscriptions, if subscribers are given this option by their financial
intermediary. The closing date of the OPO may be changed (see section 5.3.2 of this securities note).
Number of shares offered under the OPO
At least 10 % of the Offered Shares (before any exercising of the Overallotment Option), will be offered under
the OPO. Consequently, should the demand expressed under the OPO permit, the number of shares allotted in
response to orders issued under said OPO will be 10% or more of the Offered Shares.
The number of Offered Shares included in the OPO may be increased or decreased in accordance with the
procedures detailed in section 5.1.1 of this securities note.
45
Authorized persons, order receipt and transmission
The persons authorized to place orders under the OPO are natural persons who are French nationals or French
residents or who are nationals of one of the States party to the European Economic Area agreement and protocol
(Member States of the European Union, Iceland, Norway and Liechtenstein, hereinafter referred to as the "States
belonging to the EEA"), French mutual funds or legal persons or mutual funds or legal persons from one of the
States belonging to the EEA that are not, within the meaning of Article L. 233-3 of the French Commercial code,
under the control of entities or persons who are nationals of States other than States belonging to the EEA, as
well as investment clubs and associations domiciled in France or in States belonging to the EEA and whose
members are French nationals or nationals of one of the States belonging to the EEA, subject to the stipulations
appearing in section 5.2.1 of this securities note. Other persons have a duty to inform themselves of any local
placement restrictions, as shown in section 5.2.1 of this securities note.
Natural persons, legal persons and mutual funds that do not have accounts in France enabling them to subscribe
for shares under the OPO shall open such accounts with an authorised intermediary when they place their orders.
Subscription orders must be signed by the ordering party or their representatives or, in the event of agency, by
the agent. In this last case, the agent must:

either hold a mandate providing for specific stipulations under the terms of which its client has
undertaken, for transactions where individual investors are only authorised to place a single order, not to
place orders without having requested and obtained written confirmation from the agent that an order has
not been placed for the same securities under the agency agreement;

or take any other reasonable measures to prevent multiple orders (for example, informing clients that an
order has been placed on their behalf and that, as a result, said clients may not place a direct order of the
same kind, without having informed the agent of their decision, in writing, prior to the transaction being
concluded, so that the agent may cancel the corresponding order).
Categories of orders likely to be issued in response to the OPO
Persons wishing to participate in the OPO must place their orders with an authorised financial intermediary in
France, no later than 30 June 2014 at 17:00 (Paris time) for subscriptions made in person and at 20:00 (Paris
time) for online subscriptions, if subscribers have been given this option by their financial intermediary.
A orders
In accordance with Article P 1.2.16 of Euronext Rule Book II relating to particular rules applicable to French
regulated markets, orders will be split according to the number of securities requested:

Al order portion: from 1 share to 100 shares inclusive; and

A2 order portion: over 100 shares
The OPO results notice which will be published by Euronext will show any reductions applied to orders, given
that A1 order portions will receive preferential treatment compared to A2 order portions if all the orders cannot
be met in full.
It is further specified that:

each order must be for a minimum of 1 share;

the same ordering party may not issue more than one single order, which may not be split between several
financial intermediaries and must be given to one single financial intermediary;

each member of a tax household may place one order. Orders issued by minors will be formulated by their
legal representatives and each of these orders will benefit from the advantages normally attached thereto.
46
In the event of a reduction, this shall be applied separately to orders placed by each of said members of
the tax household;

no orders may be issued for more than 20% of the number of shares offered under the OPO;

orders may be filled with a reduced number of shares, in accordance with the procedures described below;

should the application of a reduction rate, or rates, result in a fractional number of shares being allotted,
this number will be rounded down to the next whole number;

orders will be expressed in numbers of shares with no indication of price and will be deemed to be
stipulated at the Offering Price; and

even in the event of a reduction, orders will be irrevocable, subject to the instructions contained in section
5.3.2 of this securities note.
Authorised financial intermediaries in France will forward the orders to Euronext, in accordance with the
timetable and procedures specified in the OPO opening notice which will be circulated by Euronext.
As a reminder, the orders will be deemed null and void if the Company's press release, indicating the final
Global Placement and OPO procedures, has not been issued.
Order reduction
A1 order portions have priority over A2 order portions. Reduction rates as high as 100% may be applied to A2
order portions in order to service A1 orders.
Reductions will be made on a proportional basis within each order type. Should the application of reduction
procedures result in a fractional number of shares, this number will be rounded down to the next whole number.
Order revocation
Subscription orders received under the OPO are irrevocable even in the event of reduction, subject to the
provisions applicable in the event of a new indicative price range being set or in the event of a price being set
outside the indicative price range referred to below (see section 5.3.2 of this securities note).
OPO results
The results of the OPO will be announced in a press release by the Company and in a notice by Euronext, due to
be issued on 1 July 2014, apart from in the event of early closing, when the press release and notice should be
disseminated the day following the Offering’s closing date.
Said notice will specify any rate of reduction applied to the orders.
5.1.3.2
Main characteristics of the Global Placement
Duration of the Global Placement
The Global Placement will begin on 18 June 2014 and will end on 1 July 2014 at 12:00 (Paris time). If the
closing date of the OPO is extended (see section 5.3.2 of this securities note), the closing date of the Global
Placement may be extended accordingly.
The Global Placement may be closed early without prior notice (see section 5.3.2 of this securities note).
Persons authorized to issue orders under the Global Placement
The Global Placement will primarily be issued to institutional investors (including to investors acquiring such
securities for a total of at least €50,000 per investor or at least €100,000 if the Member State has transposed the
amending prospectus directive) in France and abroad (excluding, in particular, the United States).
47
Orders likely to be issued under the Global Placement
Orders will be expressed in numbers of shares or in the amount requested. They may include price-related
conditions.
Receipt and transmission of orders likely to be issued under the Global Placement
In order to be taken into consideration, orders issued under the Global Placement must be received by one or
more Joint Lead Managers and Joint Bookrunners no later than 1 July 2014 at 12:00 (Paris time), apart from in
the event of early closing.
Only orders with a price expressed in euro, that is the same as, or higher than, the Offering Price, to be set under
the Global Placement, in accordance with the terms shown in section 5.3.1 of this securities note, will be
considered in the allocation procedure.
Order reduction
Orders issued under the Global Placement may be subject to total, or partial, reduction.
Order revocation
Any orders issued under the Global Placement may be cancelled through the Underwriters who have received
said order, until 1 July 2014 at 12:00 (Paris time).
Global Placement results
The results of the Global Placement will be announced in a Company press release by the Company and in a
notice by Euronext, due to be issued on 1 July 2014, excluding from in the event of early closing when the press
release and notice should be disseminated the day following the Offering's closing date.
5.1.4
Revocation or suspension of the Offering
Should demand prove to be insufficient or should a decision be taken to reduce the size of the Offering, the share
capital increase planned under the Offering may be limited to the subscriptions received, provided that these
amount to at least 75% of the amount of the issuance initially planned.
Should the total number of orders received fail to reach (i) at least 75% of the amount of the initial planned
issuance, namely subscription of a minimum number of 1,287,737 New Shares (representing a minimum amount
of around €22.02 million, based on the lower limit of the indicative range of the Offering Price) and/or (ii) all the
Initial Sold Shares, the Offering would be cancelled and the subscription and purchase orders would be void.
In addition, the Offering will be subject to the Underwriting Agreement referred to in section 5.4.3 of this
securities note being signed, and not having been cancelled, at the latest, by the date of settlement/delivery of the
Offered Shares and to a certificate being issued by the depositary of the funds attesting to the subscription of the
New Shares.
Should the Underwriting Agreement fail to be signed, the stock market listing and the Offering would be
cancelled on a retroactive basis.
Should the Underwriting Agreement be cancelled or should the depositary's certificate fail to be issued, the
subscription and purchase orders placed prior to the settlement/delivery date and the Offering would be cancelled
on a retroactive basis. More specifically:

the OPO, the Global Placement and all related orders would be cancelled retroactively;

neither the Existing Shares, nor the New Shares would be admitted to trading on Euronext Paris;
48

all shares trading up until (and including) the settlement/delivery date would be cancelled and
terminated retroactively, each investor being personally liable for any losses and costs arising, if
applicable, from any such cancellation.
In the event of failure to sign, or termination, of the Underwriting Agreement, or failure to issue the depositary
certificate, such information will be contained in a press release issued by the Company and a notice issued by
Euronext. In accordance with section 6801/2 of Euronext's harmonised market rules, Euronext cannot be held
liable for any loss incurred by any person that may arise from the withdrawal of the Offering by the Company
and the resulting cancellation of transactions.
5.1.5
Order reduction
See section 5.1.3 of this securities note for a description of the reduction of orders issued under the Offering.
5.1.6
Minimum or maximum number of shares for which an order may be placed
See section 5.1.3 of this securities note for details of the minimum or maximum numbers of shares for which
orders issued under the OPO may be placed.
There is no minimum or maximum amount for orders issued under the Global Placement.
5.1.7
Order revocation
See sections 5.1.3.1 and 5.1.3.2 respectively of this securities note for a description of the order revocation
issued under the OPO and the Global Placement.
5.1.8
Payment and settlement procedures of Offered Shares
The price of Offered Shares purchased or subscribed (see section 5.3.1.1 of this securities note) under the
Offering must be paid by ordering parties, in cash, by the date of the settlement/delivery of the Offering at the
latest, or, according to the indicative timetable, by 4 July 2014.
Shares will be registered in the account of the ordering parties as soon as possible, once the results notice has
been issued by Euronext or, according to the indicative timetable, from 1 July 2014 and no later than the
settlement/delivery date or, according to the indicative timetable, by 4 July 2014.
Funds are to be paid to Selling Shareholders for the sale of Sold Shares by the Offering's settlement/delivery
date, or 4 July 2014.
Funds are to be paid to Selling Shareholders for the sale of Additional Sold Shares under the Overallotment
Option, no later than the third working day after the date on which the Overallotment Option is exercised.
5.1.9
Publication of the results of the Offering
The Offering's results and final procedures will be announced in a press release by the Company and a notice by
Euronext to be released on 1 July 2014, apart from in the event of early closing (given, however, that the
duration of the OPO cannot be less than three trading days - see section 5.3.2 of this securities note) in which
case the press release and the notice should be issued the day following the Offering’s closing date.
5.1.10
Preferential subscription rights
The share capital increase under the Offering is to be implemented with cancellation of preferential subscription
rights.
49
Plan for distribution and allotment of securities
5.2
Category of potential investors - Countries where the Offering will be opened – Limitations
applicable to the Offering
5.2.1
5.2.1.1
Categories of potential investors and countries where the Offering will be opened
The Offering comprises:


a Global Placement aimed at institutional investors comprising:

a placement in France, and

an international private placement in certain countries excluding, in particular, the United States; and
a public offering in France in the form of an OPO, primarily aimed at individuals.
5.2.1.2
Limitations applicable to the Offering
The distribution of the document de base, this securities note, the Prospectus summary or any other document or
information relating to the transactions provided for this securities note or the offering or the sale or subscription
of Company shares may, in some countries, including the United States, be subject to specific regulations.
Persons in possession of the aforementioned documents must find out about any restrictions arising from local
regulations and must comply with said regulations. Authorised intermediaries may not accept any orders from
clients with an address in a country that has introduced these types of restrictions and corresponding orders will
be deemed to be null and void. Any person (including the trustees and nominees) receiving the document de
base, this securities note, the Prospectus, its summary or any other document or information relating to the
Offering, must only distribute it or send it to such countries in accordance with applicable laws and regulations.
Any person who, for whatever reason, may forward or allow the forwarding of the aforementioned documents to
such countries, must draw the attention of the addressee to the stipulations contained in this section.
This securities note, the document de base, the Prospectus, its summary and other documents relating to the
transactions provided for this securities note do not constitute an offer of sale or the solicitation of an offer to
subscribe for securities in any country in which such an offer or solicitation would be unlawful. This securities
note, the document de base and the Prospectus have not been registered or approved outside of France.
The Underwriters will only offer shares for sale in compliance with the laws and regulations in force in the
countries where the Offering is made.
5.2.1.2.1 Limitations concerning the United States
Company shares have not been, and will not be, registered in accordance with the U.S. Securities Act of 1933
(the "Securities Act"), nor with any stock market regulatory authority controlled by a U.S. state. Consequently,
Company shares may not be offered or sold or otherwise assigned or transferred by any means whatsoever to the
United States, either on behalf of, or for the benefit of, U.S. persons unless after registration or within the context
of transactions exempt from registration under the Securities Act.
The document de base, this securities note, the Prospectus, its summary and any other document prepared as part
of the Offering, must not be distributed in the United States.
5.2.1.2.2 Limitations concerning European Economic Area States (other than France)
With regard to European Economic Area States other than France (the "Member States") where the Prospectus
Directive has been transposed, no action has been undertaken or will be undertaken, for the purpose of
permitting a public offering of Company shares requiring the publication of a prospectus in any of the Member
States. Consequently, Company shares may only be offered in Member States:
50

to eligible investors, as defined by the Prospectus Directive;

to fewer than 100 or, if the Member State has transposed the relevant provision of the Amending
Prospectus Directive, 150 natural or legal persons (other than eligible investors as defined in the
Amending Prospectus Directive) per Member State; or

under circumstances falling within the scope of Article 3(2) of the Prospectus Directive.
For the purposes of this section, (i) the expression "public offering" in a given Member State means any
communication sent to persons in any form and by any means that presents sufficient information on the offering
conditions and the securities to which the offering relates, to enable an investor to decide to purchase or
subscribe for these securities, such as this definition has been amended, if applicable, in the relevant Member
State, (ii) the expression "Prospectus Directive" means Directive 2003/71/CE of 4 November 2003, as
transposed in the Member State (as amended, including by the Amending Prospectus Directive, provided that the
latter has been transposed by each Member State) and (iii) the expression "Amending Prospectus Directive"
means the European Parliament and Council Directive 2010/73/EU of 24 November 2010.
These sales restrictions relating to Member States are in addition to any other sales restrictions applicable in
Member States that have transposed the Prospectus Directive.
5.2.1.2.3 Limitations relating to the United Kingdom
The Prospectus is distributed to, and intended solely for, persons who (i) are located outside the United
Kingdom, (ii) are "investment professionals" (meaning persons with professional investment experience)
according to Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) (the "FSMA")
Order 2005 (the "Order"), (iii) are "high net worth entities" or any other person falling within the scope of
Article 49(2) (a) to (d) of the Order ("high net worth companies", "unincorporated associations", etc.) or (iv) are
persons to whom an invitation or an inducement to engage in investment activity (within the meaning of Article
21 of the FSMA) may be legally communicated or sent (known collectively hereinafter as "Eligible Persons").
Any invitation, offer or agreement to subscribe for Company shares may only be proposed or concluded with
Eligible Persons. The Company shares referred to in the Prospectus may not be offered to persons located in the
United Kingdom other than Eligible Persons. Any person other than an Eligible Person may not act, or rely, on
the Prospectus or on any one of its provisions. The persons responsible for the distribution of this prospectus
must comply with the legal requirements for the distribution of the Prospectus.
5.2.1.2.5 Limitations relating to Australia
No prospectus, information document, offer-related document or notice relating to Company shares has been
filed with the Australian Securities and Investments Commission or the Australian Stock Exchange Limited.
Consequently, no one may (a) proceed, offer or solicit orders within the context of the issuance, sale or purchase
of Company shares on Australian territory, or to or from Australia (including any offer or invitation that may be
received by a person in Australia) or (b) distribute or publish any prospectus, information document, offerrelated document or notice relating to Company shares, in Australia, unless the offer does not require investor
information in accordance with section Part 6D.2 of the Corporations Act 2001 (CWLTH) of Australia and any
such action is taken in accordance with other applicable laws and regulations.
5.2.1.2.6 Limitations relating to Canada and Japan
The Offered Shares may not be offered or sold in Canada and Japan.
5.2.2
Intention to subscribe expressed by the Company's main shareholders or members of its
administrative, management or supervisory bodies or anyone intending to place a subscription
order in excess of 5%
51
As far as the Company is aware, no person intends to place a subscription order in excess of 5%.
5.2.3
Pre-allotment disclosure
Such disclosures appear in sections 5.1.1 and 5.1.3 of this securities note.
5.2.4
Notice to subscribers
Under the OPO, investors who have placed subscription or purchase orders will be informed of their allocation
by their financial intermediary.
Under the Global Placement, investors who have placed subscription or purchase orders will be informed of their
allocation by the Joint Lead Managers and Joint Bookrunners or the Co-Lead Manager.
5.2.5
Increase Option
Depending on the size of the demand, the Company may, in agreement with the Joint Lead Managers and Joint
Bookrunners, decide to increase the number of New Shares initially offered by no more than 15% of the
cumulative number of New Shares and Initial Sold Shares, i.e., based on the midpoint of the indicative range of
the Offering Price, by a maximum of 276,316 additional shares, at the Offering Price (such as this term is
defined in section 5.3.1 of this securities note).
The decision to implement the Increase Option will be taken when the Offering Price is set by the board of
directors, expected to be held on 1 July 2014 and will be reported in the Company's press release and in the
Euronext notice announcing the results of the Offering.
5.2.6
In order to cover any overallotments, some Selling Shareholders will grant the Underwriters an overallotment
option (the "Overallotment Option") allowing the acquisition of a number of existing shares representing no
more than 15% of the cumulative number of Initial Sold Shares and New Shares (after the full exercise of the
Increase Option), i.e., based on the midpoint of the indicative range of the Offering Price, a maximum of
317,763 existing shares, at the Offering Price (such as this term is defined in section 5.3.1 of this securities note).
This Overallotment Option may be exercised by the Joint Lead Managers and Joint Bookrunners in the name of
and on behalf of the Underwriters at any one given time, in full or in part, for a period of thirty calendar days
from the date on which the Offering Price is set or, for information purposes only, no later than 31 July 2014
(inclusive).
If the Overallotment Option is exercised, related information is brought to the attention of the public by means of
a press release issued by the Company.
Price determination
5.3
5.3.1
Price determination method
5.3.1.1
Price of Offered Shares
The price of the shares offered under the Open Price Offering will be the same as the price of shares offered
under the Global Placement (the "Offering Price").
The Offering Price is to be set on 1 July 2014 by the Company's board of directors, given that this date may be
postponed or brought forward as indicated in section 5.3.2 of this securities note.
52
The Offering Price will be calculated by comparing the share offering under the Global Placement and demand
from investors using the so-called "bookbuilding" technique as developed on the basis of professional practice.
This comparison will be made, in particular, on the basis of the following market criteria:

capacity of the selected investors to ensure the orderly development of the secondary market;

order of arrival of investors' demands;

requested quantity; and

price sensitivity of demands expressed by investors.
The Offering Price may be within a range of between €17.10 and €20.90 per share. This range may be amended
at any time up until (and including) the date set for the closing of the Offering under the circumstances specified
in section 5.3.2 of this securities note. This information is purely indicative and gives no indication of the
Offering Price, which may be set outside this range in accordance with the conditions set out in section 5.3.2 of
this securities note.
5.3.1.2
Price range assessment criteria
The Offering Price may be set within an indicative price range of between €17.10 and €20.90 per share. This
range may be amended at any time up until (and including) the date set for determining the Offering Price.
This information is given solely for information purposes and does not, in any way, prejudge the Offering Price,
which may be set outside this range.
This indicative price range was approved with regard to the prevailing market conditions as at 12 June 2014.
Should the Offering Price be set outside the indicative price range, investors are requested to refer to section
5.3.2 of this securities note.
Financial ratios
Financial ratios are presented below for information purposes only. This information does not, in any way,
prejudge the Offering Price, which may be set outside this range. The chosen Offering Price will be determined
based on the procedure described in section 5.3.1.1 of this securities note.
The valuation method using financial ratios aims to compare the Company with companies listed in its sector
and having similar business profiles, while acknowledging that each company has its own specific financial and
operating characteristics, which are likely to generate biases in the comparison.
The two companies most directly comparable with Viadeo are LinkedIn and Xing, which are the two other
leading professional social networks listed on a stock exchange. However, we should note that their positioning
is different to that of Viadeo, since LinkedIn has an overall international approach and Xing, a local approach
focused on German-speaking markets (Germany, Switzerland and Austria). Furthermore, solutions aimed at
professionals (recruitment and advertising) represent a significant proportion of LinkedIn's revenue, whereas
Xing's business model is focused mainly on online subscription offers.

LinkedIn: an American company founded in 2003 and listed on the New York stock exchange in 2011,
LinkedIn is the global leader in the industry. In 2013, LinkedIn posted consolidated turnover of $1,528
million. At the same date, the company employed some 5,000 people and boasted 277 million members
worldwide, of whom 74 million are located in the Europe, Middle-East and Africa region (EMEA). In
2013, the EMEA region generated turnover of $358 million, 23% of the total.
53

Xing: also founded in 2003 and listed on the Frankfurt Stock Exchange in 2006, Xing is the leading
player in Germany. Its strategy is primarily local, focused on German-speaking countries. In 2013, the
company posted consolidated turnover of €84.8 million. At the same date, Xing employed around 571
people and had 14 million members, 7 million of whom are located in the region comprised of
Germany, Austria and Switzerland.
Three other groups of comparable companies are also presented, but less relevant to Viadeo, given their different
business models.
1.
Employment websites, such as Monster, Seek, 51 Job and Info Edge, which are partially comparable
with Viadeo in terms of recruitment solutions, although Viadeo has a more comprehensive offer in this
segment and enables the targeting of "passive candidates" who are not present on job search websites.

Monster: a website created in 1999 enabling online job searches, Monster is currently the world's
leading player in this segment. North America represents its primary market (55% of turnover in 2013).
In 2013, Monster employed 4,000 people (as at 31 December 2013) and generated turnover of $808
million.

SEEK: an Australian group, founded in 1997 and offering online services in the areas of teaching,
professional training and job searching through classified ads. The job-seeking business in Australia
and worldwide represents the company's main source of revenue (74% of turnover in 2013). SEEK also
owns Zhaopin, one of the main Chinese job-seeking platforms, listed on the stock exchange on 12 June
2014. In 2013, the company, which employed 6,000 people worldwide, generated turnover of $550
million.

51 Job: initially a classified job ad publication in Beijing, this Chinese company is now the largest
online job-seeking portal in the country. Online recruitment services accounted for 65% of turnover in
2013, the remaining percentage corresponding to training, headhunting and standard recruitment
activities. In 2013, 51 Job employed 5,499 people in China with turnover of $277 million.

Info Edge: an Indian company, founded in 1995 and having online platforms with classified ads in the
areas of employment, real estate, wedding services and education. It operates through various websites.
Recruitment solutions represent the company's main source of revenue (77% in 2013). In 2013, Info
Edge, which employed 3,150 people in India, generated turnover of $70 million.
Two other comparable samples comprised of Chinese and Russian websites are also presented, considering:
i. their local positioning, which is in line with Viadeo's multi-local strategy;
ii. the specific dynamics and strong growth of these markets, in which Viadeo operates.
2. Chinese websites

Tencent: Chinese group founded in 1998, having the largest portal of online services in China (social
networks, e-commerce, games, instant messaging, etc.). In 2013, Tencent generated turnover of $9,885
million and employed 27,492 people in China.

YY: Chinese video-sharing social network, founded in 2005 and with more than 300 million users.
Listed on the stock market in November 2012, YY employs 1,751 people in China. YY generated
turnover of $298 million in 2013 (as at 31 March).
54
3. Russian websites

Yandex: Russian portal and search engine founded in 1997. Yandex is the leading search engine in
Russia, with nearly 62% of market share. The company employs 4,902 people and generated
consolidated turnover of $1,207 million in 2013.

Mail.Ru: Russian web portal created in 1998 and listed on the stock exchange in 2010, Mail.ru offers
varied online services (search engine, inbox, instant messaging, games, Internet browser, etc.). In 2013,
the company employed 3,046 people with turnover of $836 million. Online advertising represented 34%
of the company's turnover, online game services 24% and social network services 32%.
Price (€)
Rev.
Growth
14-16
2014
2015
2016
2014
2015
2016
2014
2015
2016
13,075
121.36
31.6%
24.5%
26.5%
29.8%
8.4x
6.3x
4.8x
34.1x
23.6x
16.2x
440
92.83
11.8%
28.7%
33.4%
34.9%
4.6x
4.1x
3.7x
16.1x
12.3x
10.6x
Median
21.7%
26.6%
30.0%
32.4%
6.5x
5.2x
4.3x
25.1x
17.9x
13.4x
Mean
21.7%
26.6%
30.0%
32.4%
6.5x
5.2x
4.3x
25.1x
17.9x
Company
(Values in €m)
Market
Enterprise
Share
Cap
Value
14,776
518
P/E
EV / EBITDA
EV / Revenue
EBITDA Margin
2015
2016
n/m
n/m
42.3x
38.4x
28.0x
23.3x
38.4x
28.0x
32.8x
13.4x
38.4x
28.0x
32.8x
2014
Professional Social Networks
LinkedIn
Xing
Online Jobs Classifieds
SEEK
4,010
4,165
11.79
10.0%
42.2%
44.5%
46.6%
7.5x
6.8x
6.2x
17.9x
15.2x
13.4x
29.2x
24.6x
20.6x
51Job
1,333
942
44.84
14.6%
29.7%
33.4%
34.2%
4.2x
3.6x
3.2x
14.0x
10.9x
9.3x
19.0x
16.3x
12.7x
Info Edge
1,006
1,000
9.16
19.3%
25.5%
29.0%
34.7%
12.4x
10.3x
8.7x
48.8x
35.6x
25.2x
n/m
43.0x
32.2x
416
500
4.57
2.4%
14.8%
16.7%
17.3%
0.9x
0.8x
0.8x
5.8x
5.0x
4.7x
15.5x
12.7x
9.8x
Median
12.3%
27.6%
31.2%
34.5%
5.8x
5.2x
4.7x
15.9x
13.0x
11.3x
19.0x
20.5x
16.6x
Mean
11.6%
28.0%
30.9%
33.2%
6.2x
5.4x
4.7x
21.6x
16.7x
13.1x
21.2x
24.1x
18.8x
22.9x
Monster
China Internet
101,629
98,565
11.00
22.4%
39.2%
39.8%
41.4%
10.5x
8.6x
7.0x
26.7x
21.6x
16.9x
37.1x
28.9x
2,857
2,587
51.27
43.4%
32.0%
30.8%
33.6%
7.1x
4.8x
3.4x
22.2x
15.7x
10.3x
29.0x
21.7x
15.4x
Median
32.9%
35.6%
35.3%
37.5%
8.8x
6.7x
5.2x
24.5x
18.7x
13.6x
33.1x
25.3x
19.1x
Mean
32.9%
35.6%
35.3%
37.5%
8.8x
6.7x
5.2x
24.5x
18.7x
13.6x
33.1x
25.3x
19.1x
17.6x
Tencent
YY
Russia Internet
Yandex
8,083
7,976.58
25.15
21.1%
42.0%
43.0%
41.2%
7.6x
6.2x
5.2x
18.1x
14.3x
12.6x
27.4x
22.4x
Mail.ru
5,552
4,879.32
26.55
17.4%
54.1%
53.5%
53.8%
7.0x
5.9x
5.1x
12.9x
11.0x
9.4x
20.1x
16.8x
14.5x
Median
19.3%
48.1%
48.3%
47.5%
7.3x
6.0x
5.1x
15.5x
12.7x
11.0x
23.8x
19.6x
16.0x
Mean
19.3%
48.1%
48.3%
47.5%
7.3x
6.0x
5.1x
15.5x
12.7x
11.0x
23.8x
19.6x
16.0x
Source: Capital IQ as of dd juin yyyy, annualised to December.
Discounted cash flows
The discounted cash flow method makes it possible to assess the Company's intrinsic value by taking into
account its prospects for development. The implementation of this method, based on the Company's assumptions
and objectives (as described in chapter 12 of the document de base) is in line with the chosen price range.
5.3.2
Procedure for publishing the Offering Price and changes to the parameters of the Offering
5.3.2.1
Date of Offering Price determination
The Offering Price is due to be set on 1 July 2014, given that this date may be postponed if market conditions
and bookbuilding results prevent the Offering Price from being set under satisfactory conditions (see section
5.3.2.4 of this securities note).
5.3.2.2
Publication of the Offering Price and the number of Offered Shares
The Offering Price and the final number of Offered Shares will be made public by means of a press release
issued by the Company and by a notice issued by Euronext on 1 July 2014according to the indicative timetable,
55
unless the Offering Price is set early in which case the press release and the notice will be released on the date on
which the Offering Price is set.
5.3.2.3
Amendment of the price range, setting the Offering Price outside the range and changes
to the number of New Shares
Changes allowing for revocation of orders issued under the OPO
Should the upper limit of the price range be raised or should the Offering Price be set above the upper limit of
the price range (original or, if applicable, amended), the following procedure will be applied:

Publication of changes: new Offering procedures will be made public by means of a press release
issued by the Company and a notice issued by Euronext. The aforementioned Company press release
and Euronext notice will show the new price range and, if applicable, the new timetable, with the new
closing date for the OPO, the new date on which the Offering Price is to be set and the new
settlement/delivery date.

OPO closing date: the ОРО closing date will be set so that there are at least two trading days between
the date on which the aforementioned press release is issued and the new OPO closing date.

Revocability of orders under the OPO: orders issued under the ОРО prior to the publication of the
aforementioned press release will be upheld unless expressly revoked prior to, or on, the new OPO
closing date. New irrevocable orders may be issued up until, and on, the new OPO closing date (such
orders may, however, be expressly revoked prior to, or on, the new OPO closing date, if the date on
which the Offering Price is set is once again postponed and/or new changes are made to Offering
procedures).
Changes not leading to the revocation of orders issued under the OPO

The Offering Price may be freely set below the lower limit of the indicative price range or the range
itself may be lowered. The Offering Price or the new indicative price range would then be made
public under the conditions provided for in section 5.3.2.2 of this securities note, in the absence of any
material impact on the Offering's other features.
Consequently, if the fact that the Offering Price is set below the lower limit of the indicative price
range or if the lowering of the price range, failed to have any material impact on the Offering's other
features, the Offering Price will be made public by means of the Company press release and the
Euronext notice referred to in section 5.3.2.2 of this securities note, which should be issued, according
to the indicative timetable, on 1 July 2014, unless the Offering Price is set early, in which case the
press release and the notice should be issued on the date on which the Offering Price is set.
On the other hand, if the fact that the Offering Price is set below the lower limit of the indicative price
range or if the lowering of the price range had a material impact on the Offering's other characteristics,
then the stipulations of section 5.3.2.5 below would apply.

The number of Offered Shares may also be freely changed if this change failed to have a material
impact on the Offering's other features. Otherwise, the stipulations of section 5.3.2.5 below would
apply.
56
5.3.2.4
Early closing or extension of the Offering
The closing dates for the Global Placement and the OPO may be brought forward (without the duration of the
OPO being less than three trading days) or extended under the following circumstances:

If the closing date is brought forward, the new closing date will be contained in a press release issued
by the Company and a notice issued by Euronext announcing this change no later than on the day
before the new closing date.

If the closing date is extended, the new closing date will be contained in a press release issued by the
Company and a notice issued by Euronext announcing this change no later than on the day before the
original closing date. In this event, orders issued under the Open Price Offering, prior to the
publication of the aforementioned Company press release and the Euronext notice will be upheld
unless expressly revoked prior to, or on, the new OPO closing date.
5.3.2.5
Material changes to the terms of the Offering
In the event of material changes being made to the terms of the Offering originally agreed and not provided for
this securities note, an addendum to the Prospectus would be submitted to the AMF for approval. Orders issued
under the OPO and the Global Placement would be null and void if the AMF failed to approve said addendum to
the Prospectus. Orders issued under the OPO and the Global Placement prior to receipt of the addendum to the
Prospectus approved by the AMF, may be revoked for at least two trading days after said approval is received
(see section 5.3.2.3 of this securities note for a description of circumstances under which this section would
apply).
5.3.3
Limitation or cancellation of preferential subscription right
The Offered Shares under the Open Price Offering and the Global Placement partly comprise New Shares.
The New Shares are issued by virtue of the thirtieth and thirty-third resolutions of the Company's combined
general shareholders' meeting held on 21 May 2014 authorising a capital increase with cancellation of
preferential subscription rights by way of a public offering (see section 4.6.1 of this securities note).
5.3.4
Price disparity
No transaction has had any impact on the capital in the last twelve months, apart from:
-
The issuance of 50,500, 5,000 and 50,000 convertible bonds decided on at general shareholders'
meetings held, respectively on 27 January 2014, (in favour of Bpifrance Participations, several
investment funds managed by Idinvest Partners S.A., an investment fund managed by Ventech, Angyal.,
TMM Consulting, Financière WM, Global Internet Ventures, Dan Serfaty and Thierry Lunati), 21
February 2014 (in favour of Saleh Al Hajaj) and 21 May 2014 (in favour of a fund managed by A
Capital Management), with a total principal value of €10,550,000 plus capitalised interest at 4% per
year. All of these convertible bonds shall be converted into ordinary Company shares immediately prior
to the Company's initial share listing, at the Offering Price, less a 25% discount (representing 748,524
shares and around 9.49% of the Company’s share capital prior to the operation being carried out, based
on the midpoint of the indicative range of the Offering Price).
-
The exercise, in June 2014, by Karen Serfaty, Thierry Lunati, AV3, Guillaume Olivier Doré, Jérôme
Masurel, Damien Chalret du Rieu, AviCorcos and Sacha Borantin of call options they had entered with
other shareholders of the Company, on an individual basis, on 16 November 2006 or 8 January 2007 (as
extended by the addendum of 30 November 2013), at the price of €[4.492] per share, taking into
account the 25-for-1 stock split decided by the extraordinary general shareholders' meeting held on 21
May 2014 (representing a discount of 76.36% on the midpoint of the indicative range of the Offering
57
Price), in certain circumstances with entry into force delayed until completion of the Company's IPO
solely to enable the exercise of said call options to be financed by means of the transfer of shares under
the Offering, and for a total of 466,725 shares.
5.4
5.4.1
Placement and Underwriting
Details of the financial institutions managing the initial Public Offering
The Joint Lead Managers and Joint Bookrunners are:
Société Générale
29 boulevard Haussmann
75009 Paris
Jefferies International Limited
Vintners Place
68, Upper Thames Street
Londres EC4V 3BJ
The Co-Lead Manager is:
Oddo &Cie
12 boulevard de la Madeleine
75009 Paris
5.4.2
Details of the establishment responsible for securities, financial and depositary services
Securities services (i.e., managing the registry of registered shareholders (actionnaires nominatifs)) and financial
services (payment of dividends) will be provided by CACEIS Corporate Trust (14 rue Rouget de Lisle, 92130
Issy-Les-Moulineaux, France). CACEIS Corporate Trust will issue the fund deposit certificate (certificat du
dépositaire) for this share capital increase.
5.4.3
Underwriting Agreement
The Offering will be the subject of an underwriting agreement (the "Underwriting Agreement") between the
Company and Jefferies International Limited and Société Générale, in their capacity as Joint Lead Managers and
Joint Bookrunners (the "Joint Lead Managers and Joint Bookrunners") and Oddo&Cie in its capacity as CoLead Manager (together with the Joint Lead Managers and Joint Bookrunners, the "Underwriters").
The Underwriters, not acting jointly and severally, will each undertake, for a maximum number of shares, to
obtain subscribers or, if necessary, to themselves subscribe, for New Shares at the Offering Price on the
settlement/delivery date.
This agreement does not constitute a performance guarantee within the meaning of Article L. 225-145 of the
French Commercial code.
The Underwriting Agreement should be signed once the Offering Price has been set, according to the indicative
timetable, on 1 July 2014.
The Underwriting Agreement may be cancelled by the Underwriters at any time until (and including) the
Offering's settlement/delivery date, planned for 4 July 2014, subject to certain conditions and under certain
circumstances that may affect the success of the Offering, notably in the event of inaccuracies or non-compliance
of declarations and guarantees or failure to meet any one of the Company's commitments, should one of the
conditions precedent fail to be met, in the event of significant deterioration in the Company's situation or in the
event of the occurrence of certain circumstances affecting, in particular, France, the United States or the United
Kingdom (notably, suspension or limitation of trading on Euronext Paris, NASDAQ or the New York Stock
58
Exchange, significant deterioration in the financial markets, discontinuation of banking activities, acts of
terrorism, declaration of war or any national or international crisis), provided that the Joint Lead Managers and
Joint Bookrunners consider that these circumstances seriously compromise the Offering or make it impractical.
Should the Underwriting Agreement fail to be signed, the initial stock market listing and the Offering would be
cancelled on a retroactive basis.
Should the Underwriting Agreement be cancelled or should the fund deposit certificate (certificat du dépositaire)
fail to be issued, the subscription and purchase orders placed prior to the settlement/delivery date and the
Offering would be cancelled on a retroactive basis. More specifically:

the OPO, the Global Placement and all related orders would be cancelled retroactively;

neither the Existing Shares, nor the New Shares would be admitted to trading on Euronext Paris;

all share trading up until (and including) the settlement/delivery date would be cancelled and
terminated retroactively, each investor being personally liable for any losses and costs arising, if
applicable, from any such cancellation.
In the event of failure to sign, or termination, of the Underwriting Agreement, such information will be
contained in a press release issued by the Company and a notice issued by Euronext. In accordance with section
6801/2 of Euronext's harmonised rules, Euronext cannot be held liable for any loss incurred by any person that
may arise from the withdrawal of the Offering by the Company or the resultant cancellation of transactions.
5.4.4
Lock-up undertakings
This information appears in section 7.3 of this securities note.
5.4.5
Signature date of the Underwriting Agreement and settlement/delivery of the New Shares
According to the indicative timetable, the Underwriting Agreement is due to be signed on the date on which the
Offering Price is set, or, according to the indicative timetable, on 1 July 2014 and the settlement/delivery of the
Offered Shares is due on 4 July 2014.
59
6
ADMISSION TO TRADING AND TRADING PROCEDURES
6.1
Admission to trading
Admission is requested to Compartment B of Euronext Paris for all 7,883,825 existing shares, and, on the basis
of the lower limit of the indicative range of the Offering Price, 831,691 shares resulting from the conversion of
105,500 convertible bonds immediately prior to the initial listing of the Company's shares and a maximum of
1,995,383 new shares in the event of full exercise of the Increase Option and based on the lower limit of the
indicative range of the Offering Price.
The trading terms and conditions for all the shares will be set in a notice to be issued by Euronext no later than
the first day on which such shares are listed, or 1 July 2014 according to the indicative timetable.
From 2 July 2014 and until the settlement/delivery date set for 4July 2014 inclusive, the shares will be traded
under the terms and conditions of Article L. 228-10 of the French Commercial code, or in the form of promises
of shares, on a listing line entitled "VIAD – promesses" and will be subject to the condition precedent of the
issuance of the fund deposit certificate (certificat du dépositaire) relating to the issuance of the New Shares.
From 7 July 2014, Company shares will be traded on trading line entitled "VIAD".
The Company has not made any other application for admission to trading on a regulated market.
6.2
Trading market
On the Prospectus date, the Company’s shares had not been admitted to trading on any regulated or nonregulated market.
6.3
Concomitant share offering
6.4
Liquidity contract
None.
A liquidity contract complying with the AMAFI [representative body for professionals working in the securities
industry and financial markets in France] Code of Conduct for an initial 12-month term, renewable by tacit
agreement for periods of one year, is to be signed by the Company to boost the liquidity of the Company's shares
and ensure the stability of their price of Euronext in Paris. This liquidity contract will be implemented by virtue
of the thirtieth resolution of the combined general shareholders' meeting of 21 May 2014.
The Company will inform the market of the resources allocated to the liquidity contract in a press release. The
liquidity contract should be implemented, a priori, once the stabilisation period is over.
6.5
Stabilisation
Under the terms of the Underwriting Agreement mentioned in section 5.4.3 of this securities note, Société
Générale (or any entity acting on its behalf), acting as stabilisation agent on the Underwriters' behalf (the
"Stabilisation Agent"), may (but will not, under any circumstances, be obliged) to undertake stabilising
transactions in accordance with legislative and regulatory requirements, notably those of European Commission
(EC) Regulation No. 2273/2003 of 22 December 2003 implementing European parliament and council directive
2003/06/CE of 28 January 2003 on insider dealing and market manipulation (the "European Regulation").
Please note that there is no guarantee that such transactions will be implemented and that they may, in any event,
be terminated at any time without prior notice.
60
Stabilisation transactions aim to stabilise or support the market price of the shares. They are likely to impact the
market price of the shares and may lead to a higher market price than would otherwise have prevailed. If
implemented, such transactions may be performed, at any time, for a period of 30 calendar days from the date on
which the Offering Price is set or, according to the indicative timetable, until 31 July2014 (inclusive).
The Stabilisation Agent will notify the relevant market authorities and the general public in accordance with
Article 9 of the European Regulations and Article 631-10 of the AMF General Regulations.
The Underwriters may make over-allotments under the Offering up to the number of shares covered by the
Overallotment Option plus, if applicable, a number of shares accounting for no more than 5% of the size of the
Offering (not including the Overallotment Option) in accordance with Article 11 of the European Regulation. In
accordance with Article 10.1 of the European Regulation, stabilisation transactions may not be conducted at a
higher price than the Offering Price.
61
7
HOLDERS OF SECURITIES WISHING TO SELL
7.1
Individuals or entities wishing to sell their equity securities or securities giving access
to the Company's share capital
Karen Serfaty, Thierry Lunati, Guillaume Olivier Doré, Jérôme Masurel, Damien Chalret du Rieu, AviCorcos,
Sacha Borantin, Dan Serfaty, Idinvest Partners, Ventech, Bpifrance Participations, Financière WM, TMM
consulting, Angyal, Global Internet Ventures LLC and Saleh Al Hajaj wish to sell part of their interest in the
Company under the conditions detailed in this securities note.
7.2
Number and class of securities offered by the holders of securities wishing to sell
See section 4.6.3 of this securities note.
7.3
Abstention and lock-up undertakings
Abstention undertaking
Under the terms of the Underwriting Agreement, the Company undertakes not to issue, offer, sell, or grant a
promise to sell, either directly or indirectly (notably in the form of trading in derivatives with shares as the
underlying assets), shares or securities giving access through conversion, exchange, redemption, presentation of
a warrant or any other method to the allotment of securities issued or to be issued in the future representing a
portion of the Company's share capital, nor to publicly declare the intention to proceed to one or more of the
transactions referred to hereinabove, from the date of signature of the Underwriting Agreement until the
expiration of a period of 180 days following the date of settlement/delivery of the shares issued in the context of
the Offering, unless with the prior written agreement of the Joint Lead Managers and Joint Bookrunners notified
to the Company. It is specified in this regard that (i) the shares issued for the Offering, (ii) all transactions carried
out in the context of a share buyback programme in accordance with the law and regulations, as well as with
applicable market rules, (iii) the securities that may be issued, offered or transferred to the employees or
corporate officers of the Company and of the companies in its group under the terms of future plans, already
authorised on this date, or which will be authorised by the Company's general shareholders' meeting, and (iv) the
Company's securities issued in the context of a merger or acquisition of securities or assets of another entity,
provided that the beneficiary of these securities agrees to take over this undertaking for the remaining term and
provided that the total number of securities of the Company issued in this case does not exceed 5% of the capital,
are excluded from the scope of this abstention agreement.
Lock-up undertaking of the founders
The Company's two founders who own shares and founders' warrants have made an undertaking to the
Underwriters not to offer, pledge, loan, transfer, sell or promise to sell, directly or indirectly, without the prior
agreement of the Joint Lead Managers and Joint Bookrunners, (i) 100% of the shares they own on the Offering
settlement/delivery date or that they might come to hold in the event that AV3 is wound up, restructured or
otherwise, for a period of 180 calendar days following the settlement/delivery date of the Company's shares, (ii)
90% of the shares they own on the Offering settlement/delivery date, for an additional 180 calendar days
following the 180-day period referred to above; this includes the shares they are entitled to subscribe by virtue of
their founders' warrants. It is specified in this regard that the following are excluded from the scope of these
lock-up undertakings: (a) the sale of the Sold Shares, in order to finance the increase in the equity stake in the
Company of the founders concerned, (b) all transactions on the Company's shares in the context of a tender offer
on the Company's securities, (c) all transactions on the Company's shares acquired on the market subsequent to
the initial listing of the Company's shares.
This undertaking was made by Dan Serfaty, Thierry Lunati, Karen Serfaty and their respective holding
companies.
62
Lock-up undertaking of the Company's main financial shareholders
BPI France Participations, the investment funds managed by Idinvest Partners and the fund managed by Ventech
(collectively holding more than 33.04% of the share capital before the IPO) have each made an undertaking to
the Underwriters not to offer, pledge, loan, transfer, sell or promise to sell, directly or indirectly, without the
prior agreement of the Joint Lead Managers and Joint Bookrunners, (i) 100% of the shares they own on the
Offering settlement/delivery date, for a period of 180 calendar days following the settlement/delivery date of the
Company's shares, (ii) 66% of the shares they own on the Offering settlement/delivery date, for the period of 90
calendar days following the 180-day period referred to hereinabove, and (iii) 33% of the shares they own on the
Offering settlement/delivery date, for an additional 90 calendar days following the 90-day period referred to
hereinabove, nor to enter into any other contract or transaction having an equivalent financial effect, nor to
publicly declare the intention to proceed to one or more of the transactions referred to hereinabove. It is specified
in this regard that the following are excluded from the scope of these lock-up undertakings: (a) the sale of the
Sold Shares, (b) all transactions on the Company's shares in the context of a tender offer on the Company's
securities, (c) all transactions on the Company's shares subscribed in the context of the Offering or acquired on
the market subsequent to the initial listing of the Company's shares and (d) any sale by (i) an investment fund to
another investment fund managed by the same management company, or (ii) a legal entity to any legal entity
which, directly or indirectly through one or more entities, controls or is controlled by the seller, or is controlled,
directly or indirectly by the one or more entities, by a person who controls the seller, directly or indirectly by one
or more entities.
Lock-up undertaking of the Company's other main shareholders
The Company's main shareholders other than the founders and financial investors referred to above (that
collectively own more than 52.46% of the share capital before the IPO) have each made an undertaking to the
Underwriters not to offer, pledge, loan, transfer, sell or promise to sell, directly or indirectly, without the prior
agreement of the Joint Lead Managers and Joint Bookrunners, 100% of the shares they own on the Offering
settlement/delivery date, for a period of 180 calendar days following the settlement/delivery date of the
Company's shares, nor to enter into any other contract or to conduct any transaction having an equivalent
financial effect, nor to publicly declare the intention to proceed to one or more of the transactions referred to
hereinabove. It is specified in this regard that the following are excluded from the scope of these lock-up
undertakings: (a) the sale of the Sold Shares, (b) all transactions on the Company's shares in the context of a
public offering on the Company's securities, (c) all transactions on the Company's shares subscribed in the
context of the Offering or acquired on the market subsequent to the initial listing of the Company's shares and
(d) any sale by (i) an investment fund to another investment fund managed by the same management company,
or (ii) a legal entity to any legal entity which, directly or indirectly through one or more entities, controls or is
controlled by the seller, or is controlled, directly or indirectly by one or more entities, by a person who controls
the seller, directly or indirectly by one or more entities.
The fund managed by A Capital Management also made a similar undertaking for a period of 540 calendar days
following the settlement/delivery date of the Company's shares.
63
OFFERING-RELATED EXPENSES
8
For information purposes, based on a price located at the midpoint of the indicative range of the Offering Price
(or €19.00 per share):

the gross proceeds of the issuance of the New Shares will be approximately €32.6 million, which may
be increased to approximately €37.9 million in the event of the full exercise of the Increase Option;

the net proceeds of the issuance of the New Shares will be approximately €29.8 million, which may be
increased to approximately €34.8 million in the event of the full exercise of the Increase Option;

The gross proceeds of the sale of Sold Shares will be approximately €2.4 million, possibly rising to
approximately €8.4 million in the event of the Overallotment Option being exercised in full.
On the same bases, the overall remuneration of financial intermediaries is estimated at approximately €1 million
(if the Increase Option and the Overallotment Option are not exercised) and at a maximum of approximately
€1.1 million (if the Increase Option and the Overallotment Option are exercised in full).
In the event of the reduction of the issuance to 75% of the amount initially planned, based on the lower limit of
the indicative range of the Offering Price, (i) the gross proceeds of the issuance of the New Shares would be
€22.02 million and (ii) the net proceeds of the issuance of the New Shares would be €19.63 million.
The Company will not receive any other proceeds from the sale of Sold Shares.
64
DILUTION
9
9.1
Impact of the issuance of the New Shares on the Group's consolidated shareholders'
equity
Based on the Group's consolidated shareholders' equity, the number of shares comprising the Company's share
capital at 31 December 2013(1) and a price equivalent to the midpoint of the indicative range of the Offering Price
(or the lower limit of the indicative range of the Offering Price in the event of the reduction of the issuance to
75% of the issuance initially planned), shareholders' equity per share, before and after the capital increase, would
be as follows, assuming:

the issuance of 1,716,982 New Shares (if the Increase Option is not implemented) at a price of
€19.00 per share (i.e. the midpoint of the indicative range of the Offering Price),

the issuance of 1,993,298 New Shares (if the Increase Option is implemented) at a price of €19.00 per
share (i.e. the midpoint of the indicative range of the Offering Price),

deduction of legal, accounting, administrative and financial intermediary fees against the issue
premium, with no tax effect.
Share of shareholders' equity (in
euros)(1)
in Euros, consolidated (under IFRS)
Non-diluted
basis(2)
diluted basis (3)
Before the issuance of the New Shares
€1.33
€3.56
After the issuance of the New Shares (excluding exercise of the Increase Option)
€4.92
€5.57
After the issuance of New Shares (in the event of the exercise of the Increase Option)
€5.27
€5.86
After the issuance of New Shares and after full exercise of the Increase Option and the
€5.26
€5.85
After the issuance of New Shares (75% of the issuance amount initially planned)(4)
€4.08
€4.85
(1) Taking into consideration the 25-for-1 share split decided by the Company's general shareholders' meeting held on 21 May
2014.
(2) Taking into consideration (except for the non-diluted basis before the issuance of New Shares) the conversion of all convertible
bonds on the basis of a price equivalent to the midpoint of the indicative range of the Offering Price (except for the 75% reduction
of the issuance amount initially planned, where the lower limit is used), less a 25% discount upon listing.
(3) Assuming the conversion of all convertible bonds on the basis of a price equivalent to the midpoint of the indicative range of
the Offering Price (except for the 75% reduction of the issuance amount initially planned, where the lower limit is used), less a
25% discount and the exercise of all founders' warrants (BSPCE).
9.2
Amount and percentage of the dilution resulting from the issuance of the New Shares
The impact of the Offering on the equity interest of a shareholder with a 1% interest in the Company's share
capital on the date of this Prospectus, not subscribing for said Offering (calculations made on the basis of the
number of shares comprising the Company's share capital on the Prospectus date (1)) would be as follows:

the issuance of 1,716,982 New Shares (if the Increase Option is not implemented), and

the issuance of 1,993,298 New Shares (if the Increase Option is implemented).
65
Shareholder's stake as a %(1)
As a %
Non-diluted
basis(2)
diluted basis(3)
Before the issuance of the New Shares
1.00
0.78
After the issuance of the New Shares (excluding exercise of the Increase Option)
0.76
0.67
After the issuance of New Shares (in the event of the exercise of the Increase Option)
0.74
0.65
After the issuance of New Shares and after full exercise of the Increase Option and the
0.74
0.65
After the issuance of New Shares (75% of the issuance amount initially planned) (4)
0.79
0.69
(1) Taking into consideration the 25-for-1 share split decided by the Company's general shareholders' meeting held on 21 May 2014.
(2) Taking into consideration (except for the non-diluted basis before the issuance of New Shares) the conversion of all convertible
bonds on the basis of a price equivalent to the midpoint of the indicative range of the Offering Price (except for the 75% reduction of
the issuance amount initially planned, where the lower limit is used), less a 25% discount upon listing.
(3) Assuming the conversion of all convertible bonds on the basis of a price equivalent to the midpoint of the indicative range of the
Offering Price (except for the 75% reduction of the issuance amount initially planned, where the lower limit is used), less a 25%
discount and the exercise of all founders' warrants (BSPCE).
9.3
Breakdown of share capital and voting rights
Shareholding prior to the
Offering18)
Offering(1) (3)
Offering(2) (3)
Offering in the event the
issuance is reduced to 75%
of the amount of the
issuance initially planned(3)
(3bis)
Shareholders
Number of
shares
% of capital
and voting
rights
Number of
shares
% of
capital and
voting
rights
Number of
shares
% of
capital and
voting
rights
Number of
shares
% of capital
and voting
rights
Dan
Serfaty(CEO)
25
0.00%
25
0.00%
1,083
0.01%
5,972
0.06%
Karen Serfaty(4)
358,925
4.55%
291,718
3.04%
291,718
2.75%
284,251
2.84%
Thierry Lunati
(deputy CEO)(5)
342,325
4.34%
291,701
3.04%
292,759
2.76%
292,023
2.92%
Founders and
related parties(6)
701,275
8.90%
583,444
6.08%
585,560
5.51%
582,246
5.82%
AV3 (formerly
AGREGATOR)(7)
1,316,350
16.70%
1,316,350
13.71%
1,316,350
12.39%
1,316,350
13.16%
Idinvest
Partners(8)
1,109,800
14.08%
1,109,800
11.56%
1,138,012
10.71%
1,268,411
12.68%
Ventech(9)
970,875
12.31%
970,875
10.11%
977,928
9.20%
1,010,527
10.10%
AFV2
Investissement(7)
359,275
4.56%
359,275
3.74%
359,275
3.38%
359,275
3.59%
(10)
66
Shareholding prior to the
Offering18)
Offering(1) (3)
Offering(2) (3)
Offering in the event the
issuance is reduced to 75%
of the amount of the
issuance initially planned(3)
(3bis)
Number of
shares
% of capital
and voting
rights
Number of
shares
% of
capital and
voting
rights
Number of
shares
% of
capital and
voting
rights
Number of
shares
% of capital
and voting
rights
BPI France
Participations
(formerly FSI)
524,500
6.65%
524,500
5.46%
552,712
5.20%
683,111
6.83%
CREADEV
221,200
2.81%
221,200
2.30%
221,200
2.08%
221,200
2.21%
PGA Invest(11)
226,500
2.87%
226,500
2.36%
226,500
2.13%
226,500
2.26%
Allianz Vie
104,900
1.33%
104,900
1.09%
104,900
0.99%
104,900
1.05%
Other financial
investors(12)(13)
538,625
6.83%
538,625
5.61%
551,301
5.19%
609,891
6.10%
Financial
investors
5,372,025
68.14%
5,372,025
55.95%
5,448,178
51.27%
5,800,165
57.98%
CBC (China
Biznetwork
Corp)(14)
1,124,825
14.27%
1,124,825
11.72%
1,124,825
10.59%
1,124,825
11.24%
Unyk Holding
277,925
3.53%
277,925
2.89%
277,925
2.62%
277,925
2.78%
ApnaCircle
shareholders
202,125
2.56%
202,125
2.11%
202,125
1.90%
202,125
2.02%
Soocial
shareholders
41,200
0.52%
41,200
0.43%
41,200
0.39%
41,200
0.41%
A Capital(15)
-
-
-
-
352,492
3.32%
391,657
3.92%
Other
investors(16)
1,646,075
20.88%
1,646,075
17.15%
1,998,567
18.81%
2,037,732
20.37%
164,450
2.09%
157,154
1.64%
157,154
1.48%
156,344
1.56%
Public
-
-
1,842,109
19.19%
2,436,188
22.93%
1,426,766
14.26%
Total
7,883,825
100.00%
9,600,807
100%
10,625,647
100%
10,003,253
100%
Shareholders
Natural
persons(17)
(1)
After sale of the 125,127 Sold Shares as part of the Offering and on the basis of the midpoint of the indicative range of the
Offering Price and excluding exercise of the Increase Option and the Overallotment Option.
(2)
After sale of 125,127 Sold Shares as part of the Offering and after exercise, in full, of the Increase Option and the Overallotment
Option and on the basis of the midpoint of the indicative range of the Offering Price.
(3)
Assuming the conversion of all convertible bonds on the basis of a price equivalent to the midpoint of the indicative range of the
Offering Price, or €19.00 (except in the event of the reduction of the issuance to 75% of the initially planned issuance, in which
case the lower limit of the indicative range of the Offering Price is used).
(3b)Assuming the Offering is reduced to 75% of the amount of the issue initially planned and the sale of all the Initial Sold Shares, based
on the lower limit of the indicative range of the Offering Price.
67
(4)
In addition to this direct interest, NOUCHKA (92.40% controlled by Karen Serfaty) has an indirect interest via a 12.45% interest
in AV3, which itself has a 16.70% capital interest in the Company.
(5)
In addition to this direct interest, MARLU (45% controlled by Thierry Lunati) has an indirect interest via a 23.38% interest in
AV3, which itself has a 16.70% capital interest in the Company.
(6)
Taking into account the factors indicated in Notes 4 and 5 above, the founders and related parties hold a total of 990,609 shares
directly or indirectly, i.e. 12.57% of the Company's share capital on a non-diluted basis and a total of 1,827,259 shares, i.e.
19.62% of the Company's share capital on a fully diluted basis.
(7)
These holding companies will disappear in the months following the Company's IPO in favour of direct holdings in the
Company's share capital by their respective current shareholders.
(8)
Capital interest held via 18 innovation mutual funds and 1 management company.
(9)
Capital interest held via 1 venture capital mutual fund.
(10) AFV2 is a holding company which groups together Viadeo's historic shareholders. It was created during the Company's first
funding round in June 2006 in order to simplify Viadeo's equity structure. It currently has 26 shareholders. The founders and
related parties do not own any shares (directly or indirectly) in this holding.
(12) Among which no individual investor holds more than 2.03% of the Company's share capital. However, since acquiring a stake in
the Company in April 2012, Jefferies International Limited has a 1.46% interest in the Company's share capital and voting rights.
(13) The Company has been informed of the planned disposal by Financière WM (of which William Johnston, Company director, is
manager and majority shareholder) of 14,300 Company shares out of the 104,900 that it owns.
(14) Viadeo holds 9.55% of the shares in CBC as a result of the subscription for two $5.1 million capital increases in 2007, prior to
the Group's acquisition of the Tianji platform. Viadeo does not have any other management role within CBC and, in view of
CBC's shareholder structure, does not have any significant influence likely to influence any decisions taken by the partners.
(15) Interest held via one mutual fund.
(16) Companies, funds or natural persons who have become Company shareholders as a result of various acquisitions made by the
Group (primarily bond conversions and repayments of contributions in kind made in Viadeo shares).
(17) The number of shares on a non-diluted basis primarily concerns the Company's former employees having exercised their
founders' warrants (BSPCE).
(18) Given the exercise of the call options granted by existing shareholders.
68
10
ADDITIONAL INFORMATION
10.1
Advisors with a connection to the transaction
10.2
Other information verified by the statutory auditors
10.3
Expert's report
10.4
Information contained in the Prospectus provided by a third party
N/A
N/A
N/A
N/A
69
11
UPDATE OF COMPANY-RELATED INFORMATION
11.1
Correction of material errors in the document de base
The corrections below have been made to the following information in the document de base:
-
This table cancels and replaces the one included on page 38 of the document de base, which contained
material transcription errors in its second and third columns:
In euro thousands
Impact on profit before tax
Impact on shareholders' equity
10% increase
10% decrease
10% increase
10% decrease
USD
(358)
358
664
(664)
CNY
(620)
620
428
(428)
marginal
marginal
marginal
marginal
(978)
978
1,092
(1,092)
Other currencies
TOTAL
-
Pages 39 and 40 of the document de base, "As at 31 December 2013, the contribution of the first, first five
and first ten customers to the Group's revenue amounted to 1%, 4% and 6% respectively [not 2%, 6% and
9%], compared to 1%, 5% and 7% [not 3%, 7% and 11%] as at 31 December 2012".
-
this table (and the related footnotes) cancels and replaces the one included on page 119 of the document de
base, which contained material transcription errors:
In € thousands at 31
December 2013*
% held
Shareholders'
equity (including
share capital)
Share
capital
Revenue
Net
income
Subsidiaries and indirect
subsidiaries
APVO
100%
6.275
(1.110)
16.915
(3.468)
Viadeo Limited(1)
100%
0
235
508
18
Sabri SARL
100%
8
10
411
(37)
ViadeoMaroc
100%
4
15
161
7
Wayson(2)
100%
17.490
1.994
841
(6.195)
50%
90
1.825
532
(708)
Soocial
100%
53
847
666
738
ApnaCircle
100%
49
203
608
38
Viadeo IM BV(3)
*Based on Euro/currency conversion at 31 December 2013
(1) Share capital of £1.
(2) The figures include Wayson, its subsidiary Boren, and Yingke, which together form the "Tianji" group as
described above.
(3) The figures include Viadeo IM BV and its subsidiary Viadeo IM LLC.
70
-
page 279 of the document de base, the amount of the "Additional paid-in capital" concerning the exercise
on 4 October 2013 of the BCE 04 warrants as described in the statement of changes in equity since the
Company was founded is €6,500.00 (not €12,384.06).
71
ANNEX B
ENGLISH TRANSLATION OF THE REGISTRATION DOCUMENT (DOCUMENT DE BASE)
A French société anonyme with a share capital of €157,676.50
Registered office: 30 rue de la Victoire 75009 Paris
Paris Trade and Companies Register No.: 487 497 414
DISCLAIMER
The English version of the document de base is a free translation of the official document de base prepared
in France and registered with the Autorité des marchés financiers on 27 May 2014 under number I. 14-037.
Certain sections have been intentionally omitted.
All possible care has been taken to ensure that the translation is an accurate representation of the original.
However, in all matters of interpretation of information, views or opinions expressed therein, the original
version of the document de base in French takes precedence over this translation.
1
Contents
1
2
PERSONS RESPONSIBLE................................................................................................................... 9
1.1
PERSONS RESPONSIBLE FOR THE DOCUMENT DE BASE ......................................................... 9
1.2
DECLARATION BY THE PERSONS RESPONSIBLE ....................................................................... 9
1.3
PERSONS RESPONSIBLE FOR THE FINANCIAL INFORMATION ................................................. 9
STATUTORY AUDITORS ................................................................................................................. 10
2.1
PRINCIPAL STATUTORY AUDITORS ........................................................................................ 10
2.2
DEPUTY STATUTORY AUDITORS ............................................................................................ 10
3
SELECTED FINANCIAL INFORMATION ........................................................................................... 11
4
RISK FACTORS................................................................................................................................ 13
4.1
RISKS RELATING TO THE GROUP'S BUSINESS ........................................................................ 13
4.1.1
Risks relating to the market and competition ............................................................... 13
4.1.2
Risks relating to the quality of member profiles on the Group's websites ................... 14
4.1.3
loyalty
Risks relating to the Group's ability to attract new customers and build customer
15
4.1.4
Risks relating to the multi-local strategy adopted by the Group .................................. 16
4.2
TECHNOLOGICAL RISKS ......................................................................................................... 17
4.2.1
Risks related to the availability of the Group's websites .............................................. 17
4.2.2
Risks relating to restricted or reduced access to the Group's websites due to actions of
a third party ................................................................................................................................... 18
4.2.3
Risks related to changes in the technical architecture of the Group's websites and the
Group's adaptation to new Internet access methods ................................................................... 18
4.2.4
4.3
Risks relating to activity on the Internet ....................................................................... 19
LEGAL AND REGULATORY RISKS ............................................................................................ 21
4.3.1
Risks relating to the protection of personal data .......................................................... 21
4.3.2
Risks relating to privacy and personal image rights ...................................................... 21
4.3.3
Risks relating to intellectual property ........................................................................... 22
4.3.4
Risks relating to the French Act on Confidence in the Digital Economy ....................... 25
4.3.5
Risks relating to online advertising and targeted advertising ....................................... 26
4.3.6
Risks relating to the ownership of the Group's databases ............................................ 26
4.3.7
Risks relating to the regulations of foreign countries ................................................... 26
4.4
RISKS RELATING TO THE GROUP'S ORGANISATION .............................................................. 27
4.4.1
Risks relating to the Group's stage of development ..................................................... 27
4.4.2
Risks relating to the Group's internationalisation ......................................................... 28
4.4.3
The Group could lose key employees and may be unable to attract new qualified
employees at the rate required .................................................................................................... 29
2
5
4.4.4
The Group's development will depend on its ability to manage its growth ................. 29
4.4.5
Risks relating to growth through acquisitions ............................................................... 31
4.4.6
Risk relating to the Tianji Group's legal structure ......................................................... 32
4.5
INSURANCE AND COVERAGE OF RISKS.................................................................................. 34
4.6
LITIGATION RISKS................................................................................................................... 34
4.7
FINANCIAL RISKS .................................................................................................................... 34
4.7.1
History of losses – specific risks relating to projected losses ........................................ 34
4.7.2
Liquidity risk – future requirements for capital and additional financing..................... 35
4.7.3
Foreign exchange risk .................................................................................................... 35
4.7.4
Credit risk and cash management risk .......................................................................... 37
4.7.5
Interest rate risk ............................................................................................................ 37
4.7.6
Other risks relating to debt ........................................................................................... 37
4.7.7
Risks relating to public financing ................................................................................... 38
4.7.8
Risks relating to the Research Tax Credit ...................................................................... 38
4.7.9
Risks relating to future use of tax loss carryforwards ................................................... 39
4.7.10
Risk relating to the existence of dilutive instruments ................................................... 39
INFORMATION REGARDING THE COMPANY................................................................................. 40
5.1
5.1.1
Corporate name of the Company .................................................................................. 40
5.1.2
Company's place of registration and registration number ........................................... 40
5.1.3
Date and term of incorporation .................................................................................... 40
5.1.4
Company's registered office, legal form, legislation governing its activities ................ 40
5.1.5
Highlights in the Company's development.................................................................... 41
5.2
6
7
HISTORY AND DEVELOPMENT OF THE COMPANY ................................................................ 40
INVESTMENTS........................................................................................................................ 43
5.2.1
Main investments under way ........................................................................................ 44
5.2.2
Main investments planned ............................................................................................ 44
OVERVIEW OF ACTIVITIES ............................................................................................................. 45
6.1
OVERALL PRESENTATION .................................................................................................. 45
6.2
THE PROFESSIONAL SOCIAL NETWORK MARKET .............................................................. 47
6.3
VIADEO: AN ESSENTIAL PROFESSIONAL SOCIAL NETWORK .............................................. 62
6.4
A PROVEN BUSINESS MODEL ............................................................................................ 88
6.5
MAIN DEVELOPMENT TARGETS ...................................................................................... 102
ORGANISATION CHART ............................................................................................................... 110
7.1
LEGAL ORGANISATION CHART ............................................................................................ 110
3
7.2
COMPANIES OF THE GROUP................................................................................................ 110
7.3
MAIN INTRA-GROUP FLOWS ............................................................................................... 114
8
7.3.1
Business development service agreements ................................................................ 114
7.3.2
Licensing fees............................................................................................................... 115
7.3.3
Financial flows ............................................................................................................. 116
ENVIRONMENTAL FACTORS LIKELY TO INFLUENCE THE USE OF THE GROUP'S ASSETS............. 117
8.1
9
ENVIRONMENTAL ISSUES .................................................................................................... 117
OPERATING AND FINANCIAL POSITION OVERVIEW ................................................................... 118
9.1
INTRODUCTION ................................................................................................................... 118
9.1.1
The Group's business................................................................................................... 118
9.1.2
Main factors affecting the Group's earnings ............................................................... 119
9.1.3
Segment reporting....................................................................................................... 122
9.1.4
Changes to the scope of consolidation ....................................................................... 122
9.1.5
Presentation of financial and accounting information and aggregates ...................... 122
9.1.6
Estimates and assumptions used in preparing the financial statements .................... 123
9.2
COMMENTS ON THE CONSOLIDATED INCOME STATEMENTS FOR FISCALYEARS ENDED 31
DECEMBER 2013 and 2012 .............................................................................................................. 125
9.2.1
Group revenue............................................................................................................. 125
9.2.2
Operating income ........................................................................................................ 127
9.2.3
Group net income........................................................................................................ 132
9.3
SIGNIFICANT FACTORS, INCLUDING UNUSUAL OR INFREQUENT EVENTS OR NEW
DEVELOPMENTS, MATERIALLY AFFECTING THE ISSUER'S INCOME FROM OPERATIONS, INDICATING
THE EXTENT TO WHICH IT IS AFFECTED. ......................................................................................... 133
9.4
MEASURE OR ANY FACTOR OF AN ADMINISTRATIVE, ECONOMIC, BUDGETARY, MONETARY
OR POLITICAL NATURE HAVING HAD A MATERIAL IMPACT OR ABLE TO HAVE A MATERIAL IMPACT,
WHETHER DIRECT OR INDIRECT, ON THE ISSUER'S OPERATIONS. .................................................. 133
10
LIQUIDITY AND CAPITAL RESOURCES...................................................................................... 134
10.1 INFORMATION CONCERNING THE GROUP'S CAPITAL, LIQUIDITY AND SOURCES OF
FUNDING ......................................................................................................................................... 134
10.1.1
Information concerning cash and cash equivalents .................................................... 134
10.1.2
Information on the Group's sources of funding .......................................................... 134
10.2
CASH FLOW.......................................................................................................................... 134
10.2.1
Cash flow from operating activities............................................................................. 135
10.2.2
Cash flow from investing activities .............................................................................. 136
10.2.3
Cash flow from financing activities.............................................................................. 137
10.3
RESTRICTIONS ON THE USE OF CAPITAL RESOURCES ......................................................... 138
10.4
SOURCES OF FUNDS REQUIRED IN THE FUTURE ................................................................. 138
4
11
INTELLECTUAL PROPERTY ....................................................................................................... 139
11.1
INTELLECTUAL PROPERTY POLICY ....................................................................................... 139
11.2
ELEMENTS OF INTELLECTUAL PROPERTY ............................................................................ 139
11.2.1
Trademarks .................................................................................................................. 139
11.2.2
Domain names ............................................................................................................. 141
11.2.3
Software ...................................................................................................................... 143
11.2.4
Databases .................................................................................................................... 143
11.2.5
Licence agreements ..................................................................................................... 144
11.2.6
Disputes ....................................................................................................................... 144
12
TRENDS.................................................................................................................................... 145
12.1 MAIN TRENDS SINCE THE END OF THE LAST FISCAL YEAR ...................................................... 145
12.2 KNOWN TRENDS, UNCERTAINTIES, COMMITMENTS OR EVENTS REASONABLY LIKELY TO
AFFECT THE COMPANY'S PROSPECTS ............................................................................................. 147
13
PROFIT FORECAST OR ESTIMATES .......................................................................................... 148
14
ADMINISTRATIVE, MANAGEMENT AND SUPERVISORY BODIES AND GENERAL MANAGEMENT
149
14.1
EXECUTIVES AND DIRECTORS .............................................................................................. 149
14.1.1
Composition of the board of directors ........................................................................ 149
14.1.2
Other executive positions............................................................................................ 153
14.1.3
Directors' and observers’ biographies ......................................................................... 156
14.2 CONFLICTS OF INTEREST WITHIN THE ADMINISTRATIVE, MANAGEMENT AND SUPERVISORY
BODIES AND GENERAL MANAGEMENT ........................................................................................... 159
15
15.1
COMPENSATION AND BENEFITS ............................................................................................. 159
COMPENSATION OF DIRECTORS AND EXECUTIVES............................................................. 160
15.2 AMOUNTS PROVISIONED BY THE COMPANY FOR THE PAYMENT OF PENSIONS,
RETIREMENT FUNDS AND OTHER ADVANTAGES IN FAVOUR OF DIRECTORS AND EXECUTIVES.... 165
15.3 FOUNDERS WARRANTS (BSPCE), WARRANTS (BSA) AND OTHER SECURITIES GIVING ACCESS
TO SHARE CAPITAL GRANTED TO DIRECTORS AND EXECUTIVES .................................................... 166
16
FUNCTIONING OF ADMINISTRATIVE AND MANAGEMENT BODIES ........................................ 167
16.1
COMPANY MANAGEMENT .................................................................................................. 167
16.2
INFORMATION ON THE SERVICES CONTRACTS BETWEEN EXECUTIVES AND THE COMPANY
167
16.3
BOARD OF DIRECTORS AND SPECIAL COMMITTEES - CORPORATE GOVERNANCE ............ 169
16.4
CORPORATE GOVERNANCE ................................................................................................. 173
16.5
CHAIRMAN'S REPORT ON INTERNAL CONTROL .................................................................. 174
17
17.1
EMPLOYEES ............................................................................................................................. 176
HUMAN RESOURCES ........................................................................................................... 176
5
17.1.1
Business organisation chart at 1 April 2014 ................................................................ 176
17.1.2 Biographies of non-executive directors(dirigeants non-mandataires sociaux)/members
of the management team............................................................................................................ 177
17.1.3
Number and breakdown of workforce ........................................................................ 179
17.1.4
Staff representatives ................................................................................................... 179
17.2
SHAREHOLDINGS AND STOCK OPTIONS OF DIRECTORS AND EXECUTIVES ........................ 180
17.3
SHAREHOLDINGS
AND FOUNDERS' WARRANTS AWARDED TO DIRECTORS
(MANDATAIRES SOCIAUX) ..................................................................................................... 181
17.4 EMPLOYEE SHARE OWNERSHIP............................................................................................... 182
17.5 EMPLOYEE PROFIT SHARING AND INCENTIVE AGREEMENTS ................................................. 182
18
MAIN SHAREHOLDERS ............................................................................................................ 183
18.1
BREAKDOWN OF CAPITAL AND VOTING RIGHTS AT 30 APRIL 2014 ................................... 183
18.2
SIGNIFICANT SHAREHOLDERS NOT REPRESENTED ON THE BOARD OF DIRECTORS ........... 185
18.3
VOTING RIGHTS OF THE MAIN SHAREHOLDERS ................................................................. 185
18.4
COMPANY CONTROL ........................................................................................................... 185
18.5
AGREEMENT THAT MAY LEAD TO A CHANGE OF CONTROL ............................................... 185
18.6
SECURITY INTERESTS ........................................................................................................... 185
19
TRANSACTIONS WITH RELATED PARTIES ................................................................................ 186
19.1
AGREEMENTS WITH EXECUTIVES ........................................................................................ 186
19.2
AGREEMENTS WITH SHAREHOLDERS.................................................................................. 186
19.3 STATUTORY AUDITORS' REPORT ON THE REGULATED AGREEMENTS PREPARED FOR THE
YEAR ENDED 31 DECEMBER 2013 ................................................................................................... 186
20
FINANCIAL INFORMATION CONCERNING THE ASSETS, FINANCIAL POSITION AND PROFIT
ANDLOSS OF THE ISSUER .................................................................................................................... 189
20.1 CONSOLIDATED ACCOUNTS PREPARED IN ACCORDANCE WITH IFRS FOR THE FISCAL YEARS
ENDED 31 DECEMBER 2013 AND 2012 ........................................................................................... 189
20.2
PRO FORMA FINANCIAL INFORMATION.............................................................................. 257
20.3
HISTORICAL FINANCIAL STATEMENTS of Viadeo S.A. ......................................................... 258
20.4
VERIFICATION OF THE ANNUAL HISTORICAL FINANCIAL INFORMATION ........................... 258
20.5
DATE OF MOST RECENT FINANCIAL INFORMATION ........................................................... 259
20.6
CONSOLIDATED INTERIM FINANCIAL INFORMATION ......................................................... 259
20.7
DIVIDEND DISTRIBUTION POLICY ........................................................................................ 259
20.8
LEGAL AND ARBITRATION PROCEEDINGS ........................................................................... 260
20.9
MATERIAL CHANGES TO THE FINANCIAL OR OPERATING POSITION .................................. 260
21
ADDITIONAL INFORMATION ................................................................................................... 261
21.1
SHARE CAPITAL .................................................................................................................... 261
21.1.1
Amount of the share capital ........................................................................................ 261
6
21.1.2
Non-equity securities .................................................................................................. 261
21.1.3
Acquisition by the Company of its own shares ........................................................... 261
21.1.4
Securities giving access to a percentage of the share capital ..................................... 262
21.1.5
Authorised capital ....................................................................................................... 269
21.1.6 Information on the capital of any member of the Group under option or agreed
conditionally or unconditionally to be put under option ............................................................ 274
21.1.7
Share capital history .................................................................................................... 274
21.2 MEMORANDUM AND BYLAWS ............................................................................................... 278
21.2.1 Corporate purpose (article 3 of the bylaws) .................................................................... 278
21.2.2 Bylaws or other provisions relating to members of administrative and management
bodies. ......................................................................................................................................... 278
21.2.3 Rights, privileges and restrictions attached to Company’s shares ................................... 282
21.2.4 Procedures for modifying shareholder rights .................................................................. 284
21.2.5 General shareholders' meetings (article 19 of the bylaws) ............................................. 284
21.2.6 Systems enabling the delay, deferment or prevention of a change of control ............... 285
21.2.7 Special stipulation governing changes in share capital .................................................... 285
22
KEY CONTRACTS ...................................................................................................................... 286
23
INFORMATION SUPPLIED BY THIRD PARTIES, EXPERTS' DECLARATIONS AND DECLARATIONS
OF INTEREST........................................................................................................................................ 287
24
DOCUMENTS ACCESSIBLE BY THE PUBLIC .............................................................................. 288
25
INFORMATION ON HOLDINGS ................................................................................................ 289
7
GENERAL COMMENTS
Definitions
Unless otherwise indicated, in this document de base:
 the terms "Viadeo" and "the Company" refer to Viadeo SA;
 the term "the Group" refers to the Viadeo Group, comprised of Viadeo SA, its direct
subsidiaries and sub-subsidiaries and companies which it controls.
For the specific purposes of this translation only, the financial item "EBO" for “Excédent Brut des
Opérations” used in the French version has been translated by “Operating Margin” in the English
translation of the consolidated income statement and is also referred to as “EBITDA”, as explained in
section 9.1.5.
FOREWORD
This document de base contains forward-looking statements and information on the objectives of the
Viadeo Group, particularly in chapters 6.5 "Areas of development" and 12 "Information on trends",
which may sometimes be identified by the use of the future and conditional tenses and by forwardlooking words such as "believes", "considers", "targets", "expects", "intends", "should", "wishes" and
"may". This information is based on data, assumptions and estimates that the Company considers
reasonable. The forward-looking statements and objectives included in this document de base may be
affected by known and unknown risks, uncertainties relating to the regulatory, economic, financial and
competitive environment and other factors that may cause the future results, performance and
achievements of the Company to differ significantly from the stated or suggested objectives. These
factors may include those described in chapter 4 of this document, "Risk factors".
Investors are invited to carefully consider the risk factors described in chapter 4 of this document,
"Risk factors", before making any investment decision. The occurrence of all part of these risks is
liable to have a negative impact on the activities, position, financial results or objectives of the
Company. Moreover, other risks that have not yet been identified or that the Company deems to be
non-material may have the same negative impact and investors may lose all or part of their
investment.
This document de base also contains information pertaining to the Company's markets and
competitors and to its competitive positioning, primarily in chapter 6.3 "Viadeo: an essential
professional social network". This information was mainly produced from studies carried out by
external sources. However, the publicly-available information that the Company deems to be reliable
has not been verified by an independent expert and the Company cannot guarantee that a third party
using different methods to collate, analyse or calculate the market data would obtain the same results.
The Company, its direct and indirect shareholders and investment service providers cannot give any
commitment or guarantee as to the accuracy of this information.
8
1
PERSONS RESPONSIBLE
1.1
-
PERSONS RESPONSIBLE FOR THE DOCUMENT DE BASE
Mr Dan Serfaty, co-founder, Chairman and Chief Executive Officer of the Company;
Mr Thierry Lunati, co-founder, Deputy Chief Executive Officer.
1.2
DECLARATION BY THE PERSONS RESPONSIBLE
"We hereby confirm, having exercised due diligence in this regard, that, to the best of our knowledge,
the information in this document de base is true and contains no material omission”.
[INTENTIONNALLY OMITTED]
Dan Serfaty
21 May 2014
1.3
Thierry Lunati
Deputy Chief Executive Officer
21 May 2014
PERSONS RESPONSIBLE FOR THE FINANCIAL INFORMATION
Mr Dan Serfaty
75009 Paris
Telephone: +33 (0)1 75 44 31 24
Fax: +33 (0)1 42 93 22 56
Mr Jean-Paul Alves
Chief Financial Officer
75009 Paris
Telephone: +33 (0)1 75 44 31 24
Fax: +33 (0)1 42 93 22 56
9
2
STATUTORY AUDITORS
2.1
PRINCIPAL STATUTORY AUDITORS
 KPMG AUDIT IS represented by Mr Jean-Pierre Valensi
Immeuble "Le Palatin"
3 cours du triangle 92939 Paris La Défense Cedex
KPMG AUDIT IS was appointed principal statutory auditor by the general shareholders' meeting of 29
June 2012 for a term of six fiscal years. Its term of office will come to an end after the ordinary
general shareholders' meeting held to approve the financial statements for the year ended 31 December
2017.
 GRANT THORNTON represented by Mr Vincent Frambourt
100 rue de Courcelles 75017 Paris
GRANT THORNTON was appointed principal statutory auditor by the general shareholders' meeting
of 29 June 2012 for a term of six fiscal year years. Its term of office will come to an end after the
ordinary shareholders' meeting held to approve the financial statements for the year ended 31
December 2017.
2.2
DEPUTY STATUTORY AUDITORS
 KPMG AUDIT ID represented by Mr Jean-Luc Decornoy
Immeuble "Le Palatin"
3 cours du triangle 92939 Paris La Défense Cedex
KPMG AUDIT ID was appointed deputy statutory auditor by the general shareholders' meeting of 29
June 2012 for a term of six fiscal years. Its term of office will come to an end after the ordinary
shareholders' meeting held to approve the financial statements for the year ended 31 December 2017.
 INSTITUT DE GESTION ET D’EXPERTISE COMPTABLE-IGEC represented by Vincent
Papazian
3 rue Léon Jost 75017 Paris
IGEC was appointed deputy statutory auditor by the general shareholders' meeting of 29 June 2012 for
a term of six fiscal years. Its term of office will come to an end after the ordinary shareholders'
meeting held to approve the financial statements for the year ended 31 December 2017.
During the period covered by the historical financial information, there have been no resignations or
dismissals of statutory auditors.
10
3
SELECTED FINANCIAL INFORMATION
The main financial information presented below is taken from the consolidated financial statements
prepared under IFRS.
This accounting and operational data must be read in conjunction with the information provided in
chapters 9 "Operating and financial overview", 10 "Capital resources" and 20 "Financial information
concerning the assets, financial position and results of the issuer".
This document de base was prepared on the basis of annex XXV of Delegated Regulation (EU) No.
486/2012 of March 2012 (SME scheme) and accordingly provides verified historic information for the
last two fiscal years.
Financial information selected from the Group's consolidated statement of net income (loss)
2013
2012
15,793
15,938
8,812
7,537
4,958
3,916
Other income
1,355
342
30,917
27,733
EBITDA
(8,261)
(3,655)
Current operating profit (loss)
(14,424)
(8,310)
(14,516)
(8,567)
(229)
(216)
(13,121)
(4,809)
Net profit (loss) for the year
Financial information selected from the Group's consolidated statement of financial position
2013
Non-current assets
2012
23,210
20,014
Goodwill
5,219
5,360
Intangible assets
7,827
7,141
Property, plant & equipment
1,287
1,328
1,786
1,505
Deferred tax assets
5,460
3,941
11,435
25,434
4,597
18,269
34,645
45,448
10,511
23,108
2,506
2,906
1,072
1,421
792
916
Current assets
TOTAL ASSETS
Other long term liabilities
Current liabilities
21,628
19,434
2,473
560
8,129
9,176
34,645
45,448
11
Financial information selected from the Group's statement of consolidated cash flows
2013
2012
Cash flow from operating activities
(8,817)
(963)
(6,325)
(3,675)
1,561
19,513
(13,581)
14,876
Net cash flow from (used in) financing activities
Change in net cash

Information from the Group’s segment income statement(1)
Consolidated
(en K€)
2013
VIADEO
2012
TIANJI
VIADEO
TIANJI
2013
GROUP TOTAL
2012
2013
2012
15 793
0
15 937
1
15 793
15 938
8 444
368
7 350
187
8 812
7 537
4 485
473
3 796
120
4 958
3 916
Other income
1 355
361
348
646
(361)
(652)
1 355
342
30 076
1 202
27 430
954
(361)
(652)
30 917
27 733
(19 729)
(3 444)
(16 821)
(2 578)
(23 174)
(19 399)
(3 649)
(1 764)
(1 992)
(1 097)
(5 413)
(3 089)
(9 571)
(1 860)
(8 870)
(1 319)
422
(11 009)
(9 537)
479
-
645
(8)
(61)
(2 395)
(5 866)
393
(4 048)
-
Staff expenses
Other current expenses and operating income
EBITDA
NET PROFIT (LOS S ) FOR YEAR
652
-
418
637
(8 261)
(3 655)
(14 516)
(8 567)
(229)
(216)
(13 121)
(4 809)
(1) An operating segment is a component of the Group that engages in business activities from which it may earn
revenues and incur expenses, including revenues and expenses related to transactions with other components of the
Group. Each segment represents a Cash Generating Unit ("CGU"). EBITDA per segment is regularly reviewed by
General Management to make decisions regarding the resources to be allocated to the segment and to assess its
performance. This information, regarding business activities associated with the Viadeo and Tianji segments, is
then analysed on the basis of the various service categories (subscriptions, recruitment and training services, and
marketing and advertising services).
The Group's base costs are reported in full by the Viadeo CGU. At the current stage of the Group's development,
management does not consider it useful to allocate these costs by CGU. Accordingly, there is no management fee
agreement between Viadeo and Tianji, and no operational split of these fees in the internal reporting documents.
12
4
RISK FACTORS
Investors should take all information contained in this document de base into account, including the
risk factors described in this chapter, before deciding to subscribe for or purchase the Company's
shares. The Company has reviewed the risks which may have a material adverse effect on the Group,
its business, financial position, results, prospects and ability to reach its goals. At the registration date
of this document de base, the Company has no knowledge of material risks other than those presented
in this chapter.
Nevertheless, investors should note that the list of risks and uncertainties described hereinafter is not
an exhaustive one. Other risks or uncertainties may also exist as at the registration date of this
document de base, which are unknown or not considered as having a material adverse effect on the
Group’s business, financial position, results and prospects, or which may become important factors
having a material adverse effect on the Group, its business, financial position, results, expansion and
prospects.
In each paragraph below, the risk factors are presented in descending order of importance according
to the Company's assessment at the registration date of this document de base. Accordingly, the
existence of new facts (whether inside or outside the Group) is likely to change this order of
importance in the future.
4.1
RISKS RELATING TO THE GROUP'S BUSINESS
4.1.1
Risks relating to the market and competition
The Group operates in a competitive market
The market for online professional networks is characterised by significant competition, which may
increase.
The business sector in which the Group operates is developing at a rapid pace. Larger and more
established companies may target the same market and compete directly with the Group. Smaller
companies, including mobile application developers, may also launch new products and services
competing with those of the Group, which may be readily accepted by the market. The arrival of these
new players into the market may reduce the Group's market share and audience. Furthermore, the
Group also expects its current competitors to continue to focus on the markets for marketing and
recruitment solutions in the future. Some of these companies may have more resources, more
experience and a larger audience than the Group. Accordingly, the Group cannot rule out the
possibility that another player may establish itself as the leader of online professional social networks
in France or in the Group's countries of operation or intended countries of operation in the future, or
that such player may adopt a more competitive positioning than the Group, thereby increasing its
market share at the expense of the Group's competitive development and position.
In particular, the Group is competing with the following economic players:

Players operating online professional social networks and, more generally, players from the
Internet and IT industries. The Group is facing competition from LinkedIn, based in the
United States, which offers online professional network solutions. Moreover, Xing, which is
based in Germany and currently focused on German-language markets, might decide to
position itself on one or several markets where the Group has operations.
Furthermore, insofar as the market for online professional networks is a rapidly changing
market, major Internet and IT players such as Facebook, Google, Microsoft and Twitter might
13
decide to develop solutions rivalling those of the Group or to partner with other companies to
offer such solutions.
Accordingly, all or some of these players may launch new products, services or developments
in direct competition with those offered by the Group and better meeting market expectations
and the requirements of Group customers and members. Increased competition may lead to
price pressure, a loss of market share and a decline in member involvement, which may have a
material adverse effect on the Group's development, financial position, results and prospects.

Players in the recruitment industry. In terms of recruitment solutions, Viadeo is at the
crossroads of several markets, with some of its activities thereby competing with established
online recruitment companies like Monster and Careerbuilder, etc., in addition to talent
management companies like Oracle/Taléo and Lumesse, or some traditional recruitment firms.
If the Group's recruitment services do not prove to be more effective or useful than those
offered by these companies, the Group may struggle to differentiate itself from them.

Players in the advertising and marketing industry. In terms of advertising and marketing
services, Viadeo competes with online and offline service providers which generate revenue
from advertisers and marketing specialists. If these competitors manage to offer alternative
solutions to the Group's customers, enabling them to access the Group's website users at a
lower cost, the Group may fail to keep its existing advertisers or attract new advertisers, which
may have a material adverse effect on its development, financial position, results and
prospects.
4.1.2
Risks relating to the quality of member profiles on the Group's websites
The number of members registered on the Group's websites is higher than the number of active
members at the registration date of this document de base.
"Member" refers to any user having registered on one of the Group's websites by providing an email
address and name, if applicable. Accordingly, the number of members registered on the Group's
websites is higher than the number of its active members, insofar as certain members may have
intentionally created several accounts, possibly in fictitious names, and as other members may no
longer be able to use the Group's websites, may have deleted their accounts or may have passed away
since their registration. Considering the difficulties inherent in identifying the accounts concerned, and
despite the procedures implemented, the Group has no reliable system enabling it to identify the exact
number of active members and, as such, measure the size of its Viadeo and Tianji professional
networks based on the number of registered members. However, the Group considers that the number
of members registered on its websites gives a good picture of the Group's presence in its markets.
The members of the Group's websites provide their personal information on a declarative basis and
the Group cannot exclude the possibility that a part of this information may be incomplete,
inaccurate, deceptive or obsolete.
Upon registration, websites’ members operated by the Group are fully responsible for providing
accurate and sincere information about themselves. Any deceptive or inaccurate information brought
to the Group's attention by other users could result in penalties which may include the exclusion of the
offending member. The Group does not check the identity of members registering with its websites or
the accuracy of declarations made by registered members. Therefore, the Group cannot protect
members, users or customers from suffering damage resulting from false declarations made by another
14
member, or prevent minors from registering by lying about their real age, or (more generally) prevent
people from using the Group's services for fraudulent purposes using a false identity. The occurrence
of one or more of these risks could have a material adverse effect on the Group's business, results,
financial position, development and prospects.
Furthermore, if the members registered on the Group's websites do not update their information or do
not provide accurate and complete information upon their registration, or if they do not create enough
connections or (more generally) do not use or no longer use the websites, the value of the Viadeo and
Tianji networks would be diminished. In particular, customers using the recruitment solutions offered
by the Group may not identify enough members meeting their search criteria on the Group's networks,
or may mistakenly believe that they have identified a member meeting those criteria, which could
undermine customers' trust in the quality of the Group's recruitment solutions, it being specified that
the general terms and conditions of sale only provide for a best endeavours obligation on the part of
the Group. The Group strives to encourage the members of its networks to visit the websites regularly
and to complete their profiles with accurate, full and up-to-date information. However, should the
Group fail to provide reliable information, this could have a material adverse effect on its
development, financial position, results and prospects.
4.1.3
Risks relating to the Group's ability to attract new customers and build customer
loyalty
To develop its business, the Group must continuously attract new customers, sell more services to its
current customers and increase the renewal of online subscriptions by the members of its networks, in
addition to increasing the renewal of contracts entered with its customers. The Group's ability to reach
these goals is largely dependent on the success of its sales and marketing efforts. The Group does not
generally enter into long-term contracts with its customers. The length of most contracts for corporate
solutions does not exceed one year, whereas contracts for online subscriptions may be effective for up
to two years. For subscription rates, online subscription renewals and other indicators, the Group's
historical information is limited. As such, the Group is unable to accurately predict future trends.
The Group may struggle to demonstrate the effectiveness of its recruitment and marketing solutions to
potential corporate customers. Moreover, the Group's potential customers may not have sufficient
knowledge of the solutions offered, or may prefer similar products or services, or even more
traditional products or services offered by the Group's competitors.
The speed at which the Group develops its customer base and increases the renewal rate of
subscriptions and contracts entered into with its customers may decline or vary according to various
factors, including the prices of services offered by the Group, the prices of products and services
offered by its competitors, lower recruitment among the Group's customers, the reputation of the
Group's websites, a reduced budget for recruitment or marketing services among the Group's
customers, in particular due to macro-economic factors, and even the effectiveness of solutions offered
by the Group and their cost effectiveness. If the Group fails to attract new customers, or if its
customers do not renew their contracts, or if they renew them under less favourable terms, or if its
customers do not make more use of the Group's services in the future, the Group's turnover could
increase at a slower pace, or even decrease.
Lastly, the Group must continue to provide quality services to attract new customers and retain its
existing customers. For example, the Group's recruitment solutions customers could stop using its
services if they do not manage to identify the talents they seek based on the solutions developed by the
Group. Likewise, the Group's network members with premium subscriptions could terminate their
15
subscriptions if they do not find the professional opportunities they seek via the Group's networks, and
the Group's marketing customers could stop working with the Group if their advertisements do not
seem to reach the targeted audience. Accordingly, the Group must be able to continue to show
customers that its solutions are a comparatively effective and economic mean of maximising their
results. If the Group does not manage to offer its customers high-quality solutions, it could be unable
to retain its existing customers or to attract new customers, which could have a material adverse effect
on its development, financial position, results and prospects.
4.1.4
Risks relating to the multi-local strategy adopted by the Group
The Group's strategy is based on developing a "multi-local" offer consisting in focusing its growth on
three broad regions (in addition to France), which together represented 3.7% of the Group’s total
revenue in 2013 (see section 9.2.1.2 of the document de base for further details), namely China, Russia
and French-speaking Africa, taking each region's local characteristics into account.
In particular, this strategy has produced two platforms dedicated respectively to the Viadeo and Tianji
networks, and led to the development of features and applications dedicated to specific countries or
regions (for example, see the development of the "verified profile" feature presented in paragraph
6.3.2.2 of this document de base). This approach may prove not to be as effective as the global
strategy adopted by some of the Group's competitors, which consists in using a platform of identical
features irrespective of the country in which the professional social network user is located.
Accordingly, various risks can be associated with the multi-local strategy chosen by the Group, in
particular:

it may lead to an increase in costs specific to each country or region targeted. As such, it may
deprive the Group of the economies of scale achieved by its competitors with a global
strategy;

it may also turn international members or customers away from the Group's social networks
on account of their inability (or reduced ability compared with global networks) to attract an
international audience;

it may be a source of complexity for the Group's management, which must understand the
specific challenges which the Group must meet for every country or group of countries where
it is currently focusing its efforts, in addition to adapting to the specific characteristics of the
country in question and identifying local managers likely to implement the strategy developed
within the Group's parent company, Viadeo SA. Accordingly, it may stretch out the process of
implementing the Group's platform in any new country or group of countries, in comparison
with its competitors having adopted a global strategy; and

the Group may not identify specific features or characteristics which distinguish it from its
competitors and in particular from those having adopted a global approach.
The occurrence of one or more of these risks could have a material adverse effect on the Group's
16
4.2
TECHNOLOGICAL RISKS
4.2.1
Risks related to the availability of the Group's websites
The Group may fail to adapt its current network technology and infrastructure to ensure that its
websites are constantly accessible and take a reasonable time to load.
It is important for the Group that its members, users (i.e. people consulting its websites, whether
members or non-members) and existing or future customers are able to access its websites at all times
and to enjoy reasonable loading times, regardless of their location in the world. Accordingly, the
Group strives to ensure the highest possible accessibility. For example, the Viadeo.com website was
available more than 99.5% of the time in 2013. According to internal calculations, the launch of the
new Viadeo platform in 2013 enabled a hundredfold improvement in certain loading times, and a
tenfold improvement in standard web browsing.
Nevertheless, the Group has already experienced (and may again experience) malfunctions, failures
and other performance problems related to its websites and due to various factors, in particular the
development of its technological platforms, human or software errors, capacity constraints and fraud
or security problems. In certain cases, the Group may be unable to identify the cause(s) of these
performance problems within an acceptable time frame. Given the growing complexity of the
solutions marketed by the Group and increased traffic on its websites, it could become more and more
difficult to maintain and improve the performance of the Group's websites, in particular during peak
usage periods. If the Group's websites are unavailable when users try to access them, or if their loading
time is too long, users could visit other websites to obtain the information they seek and no longer
return to the Group's websites. The Group shall continue to consistently invest considerable sums to
maintain and improve the performance of its websites and to launch new features and services. If the
Group does not manage to effectively resolve the capacity constraints of its websites, if it does not
update its systems in a timely manner and if it does not continuously develop its technological
platform and network to prepare for technological developments in the future, this could have a
material adverse effect on its business, prospects, financial position, results and development.
The Group's IT systems are vulnerable to damage and disruptions due to events such as earthquakes,
floods, power cuts, telecommunication failures, terrorist attacks and other similar events. The servers
for the Viadeo platform are installed in the headquarters of the Group's US subsidiary, APVO
Corporation, which is located in the San Francisco Bay region known for its seismic activity. Despite
all measures taken by the Group, the occurrence of a natural disaster or other unforeseen problems
may lead to a long-lasting disruption of its services.
The Group has implemented a daily back-up system which would enable it to recover most of its data
in the event of such an occurrence. Although this system was already operational at the registration
date of this document de base, it will not enable immediate data recovery. As such, should the main
data centre break down, the Group's websites may remain closed for several days or weeks until the
transition to the emergency data center is completed. The Group aims to strengthen its emergency
solutions to reduce the risk of service disruptions in the event of an incident.
The Company does not have any cover such as business interruption insurance to protect against the
potentially substantial losses which could result from service disruptions due to failures of its systems.
business, results, financial position, development and prospects.
17
4.2.2
Risks relating to restricted or reduced access to the Group's websites due to
actions of a third party
Access to the Group's websites may be restricted by governmental authorities, groups or companies,
which could slow down growth in the Group's membership base.
The development of services offered by the Group depends on its members' ability to access the
Internet and the Group's websites. Companies, groups or governmental authorities (notably in China)
could block access to the Group's websites or, more generally, the Internet, for various reasons related
in particular to security or confidentiality problems. These players, in particular in China, could also
block or limit access to the Group's websites or adopt measures limiting their members' ability to
provide accurate and up-to-date information. The performance of the Viadeo and Tianji networks'
could also be reduced, which could have an adverse effect on the Group's ability to offer attractive
subscriptions and recruitment and marketing services to its members and existing or future customers.
Group members may become less active if search engines methodologies change or if the Group's
ranking drops for some reason in the results pages of the search engines.
The visibility of the Group's websites depends to some extent on various online search engines, such
as Google, Bing and Yahoo!, which direct a considerable flow of traffic to its websites.
The Group's competitors could make substantial SEO (Search Engine Optimization) efforts, which
could enable them to have a higher ranking on search engine results pages.
Online search engines could also revise their methodologies, which could cause the Group's websites
to have a lower ranking on the relevant search engine results pages. If search engines make changes to
their search algorithms, leading to fewer new users or complicating the use of the Group's websites, or
if SEO efforts made by the Group's competitors are more effective than those made by the Group, its
membership growth could slow down, members could become less involved and the Group could lose
its existing members. These changes could be made in particular by search engines wishing to
penetrate the market for online professional networks. The Group's websites have already faced
fluctuations in their search ranking positions, and similar fluctuations may occur in the future.
4.2.3
Risks related to changes in the technical architecture of the Group's websites and
the Group's adaptation to new Internet access methods
The new technological platform and new applications and features developed by the Group may
disrupt the functioning of its websites.
The Group manages two independent platforms at the same time, dedicated to the
http://réseaux/Viadeo and Tianji networks respectively. A new platform was developed for the
Viadeo network in 2013in order to handle up to 20 times the current traffic. At the registration date of
this document de base, only some of the features included in the previous Viadeo platform were
migrated to the new technological platform. The transfer of the remaining features will be completed
by the end of 2014 (see section 6.3.3 of this document de base), it being specified that all the new
18
applications and features of the Viadeo network had been developed for the new platform at the
registration date of the document de base. The Group cannot guarantee that it will complete this
migration within the expected time frame, or that the migration will not disrupt the Viadeo platform's
functioning.
In terms of applications, the Group continuously puts new applications (developed by its teams) online
to monitor changes in techniques and the Internet. The Group tests these new applications before
putting them into production. However, it cannot exclude the possibility of an unexpected malfunction
occurring at a later stage, and therefore runs the risk (shared by all players in the sector) of suffering
the consequences of a possible malfunction in the new applications, which would disrupt the
functioning of the Group's websites.
Many people are using devices other than computers to browse the Internet, and Internet users may
prefer not to adopt the dedicated solutions developed by the Group
The number of people accessing the Internet from devices other than personal computers - and in
particular from mobile phones, personal digital assistants, smartphones and tablets, or hand-held
computers - has increased considerably over recent years and should continue to grow in the future,
according to forecasts. If the Group does not manage to update its mobile solutions, in particular to
meet its users' requirements, its business activity could be affected. Given the continuous development
of new devices, it is difficult to predict problems which the Group might face by developing special
versions of its solutions intended for use by these devices. Accordingly, the Group might be forced to
devote substantial resources to this purpose, without the certainty of success. The occurrence of one or
more of these risks could have a material adverse effect on the Group's development, financial
position, results and prospects.
4.2.4
Risks relating to activity on the Internet
The Group may be unable to stop websites from collecting its data without authorisation
Third parties have been able to collect data from the Group's websites in the past, using robots or other
means, and to misappropriate the data, for example by incorporating them into their websites with data
from other companies. When the Group became aware of these websites and their conduct, it
implemented technical and legal measures to stop such misappropriations. However, the Group may
be unable to identify such conduct in a timely manner and the technical and legal measures
implemented by the Group may be insufficient to stop it. In certain cases, in particular when said
activity occurs outside of Europe, the protective measures available to the Group may be insufficient.
Furthermore, the efforts and measures undertaken by the Group against these websites may require it
to mobilize substantial resources, in particular financial resources.
Risks relating to Internet security: viruses, hacking, online payments
Although the Group implements measures which it considers appropriate to secure and protect its IT
systems, the Group cannot offer absolute protection against viruses, Trojanhorses and other IT system
intrusion techniques. The solutions provided by the Group require the storage and transmission of
information concerning its members and customers, which may be confidential. A malicious intrusion
in the Group's IT systems could compromise the confidentiality and integrity of all or part of its data,
19
in particular personal information related to the members and/or customers of the Group's websites,
which could considerably damage the Group's reputation and even incur liabilities.
As with all websites, the Group's websites may be vulnerable to intrusions, IT viruses and other
attacks or disruptions due to the unauthorised use of its IT systems, which may lead to interrupted
service, delays, and even closed websites, in addition to the loss of critical data and the unauthorised
disclosure or use of personal data or other confidential information. If the Group's websites experience
a security breach, the trust of its members or customers may be undermined, causing them to reduce
usage or even stop using the websites.
Moreover, due to the openness of social networks and constantly evolving IT security problems, the
Group's websites are regularly exposed to so-called "phishing" attacks (i.e. attempts to acquire
usernames and personal data). A malicious attack, such as a denial-of-service attack directed against
the Group's servers, could degrade the level of services offered to users (leading for example to the
Group's websites going offline for several hours or even days), thereby causing a loss of income for
the Group and harming its business and reputation. In addition, the Group cannot exclude the
possibility that its servers may be used to spread malicious content or viruses, in particular with the
arrival of new viruses which have not yet been listed by anti-virus solution providers, or that they may
be used by malicious third parties to distribute spam.
Furthermore, third parties could attempt to fraudulently acquire sensitive information about the Group,
its members and customers from Group employees. Given that the techniques used to obtain
unauthorised access, deactivate or degrade the service or sabotage the IT systems change regularly,
often go unnoticed before an attack is launched and may come from world regions where regulations
are more flexible, it may be impossible for the Group to proactively fight these techniques or to
implement appropriate preventive measures. These problems could affect or compromise the Group's
ability to attract new members and retain the commitment of its existing members, and may prompt
said members to close their accounts or prompt the Group's customers to terminate their contracts. As
a result, the Group could be exposed to legal disputes, fines and other measures which may affect its
operating results.
The bank details provided by the Group's customers or members during online payment transactions
could also be misappropriated by unauthorised third parties and used for fraudulent purposes. To
reduce this risk, the Group relies on external service providers specialised in online payments to
implement a secure payment protocol. The Group does not receive its members' bank and credit card
details during online payments, and therefore does not keep such sensitive information.
The risks related to IT security and online payments are not specific to the Group, but concern all
companies operating one or more websites. However, the Group may be required to make substantial
investments or mobilize considerable resources in the future in order to deal with these increasing
risks, focusing in particular on IT security online. The occurrence of one or more of these risks could
have a material adverse effect on the Group's reputation, development, financial position, results and
prospects.
20
4.3
LEGAL AND REGULATORY RISKS
4.3.1
Risks relating to the protection of personal data
The Group collects, stores and uses personal data in particular. Accordingly, it is subject to
regulations regarding the processing of personal data and to other legal obligations related to
confidentiality. Any real or perceived inability to fulfil these obligations may harm the Group's
business activity.
Through its websites and mobile applications in particular, the Group processes the personal data of
individuals having created a profile on the Viadeo or Tianji networks, as applicable. Although the
Group has taken the measures it deems necessary to comply with legal provisions protecting the
members registered on its websites against the unlawful use of their personal data, it cannot exclude
the possibility of data loss or leakage through fraud, or the hacking of its systems and their misuse by
unauthorised third parties (including members). Such losses, leaks, intrusions, fraud or misuse related
to personal data processed by the Group may considerably damage the Group's image and reputation.
They may force the Group to make public statements on these events, incur its liability and have a
material adverse effect on its business, results, financial position and prospects.
In addition, the Group cannot exclude the possibility of a member or other third party challenging the
conditions under which the Group collects and processes personal data on the basis of the applicable
provisions of his/her national law on the subject. The collection, storage, transfer, processing,
confidentiality and protection of personal data are subject to various regional, federal, state and local
legislations with changing scopes and which are subject to various interpretations and may differ from
one country to another. The Group strives to comply with all the industry's applicable laws, policies,
legal obligations and codes of conduct regarding the confidentiality and protection of personal data.
However, these obligations may not be interpreted and implemented in the same way from one
country to another, and they may be contradictory with other applicable rules and practices within the
Group. Any real or perceived inability of the Group to comply with its confidentiality obligations
towards its users or other third parties, and its legal and regulatory obligations in terms of personal
data protection, or any breach of security leading to the unauthorised disclosure or transfer of personal
data regarding its members, may result in specific enforcement measures from the public authorities,
legal proceedings or public statements against the Group, and may damage the Group's reputation,
which may in turn have a material adverse effect on its business, results, financial position and
prospects.
Likewise, if third parties working with the Group, such as its customers, suppliers or developers,
infringed upon the Group's applicable laws or policies, the members' personal data could be in danger,
which may hold the Group liable and have a material adverse effect on its business, results, financial
position and prospects.
4.3.2
Risks relating to privacy and personal image rights
The Group informs its members of the manner in which their image and personal data will be used at
the time of their registration. The Group obtains their consent to that effect through their acceptance of
its general terms and conditions of use ("GTCU") and confidentiality policy. The latter was drafted in
compliance with the Safe Harbour Framework (a set of personal data collection, use, storage and
protection rules drawn up between the US (namely the US Department of Commerce) and the
European Union, on the one hand, and between the US and Switzerland, on the other. The Group
voluntarily adopted the Safe Harbour Framework and complies with the principles of this framework
21
(in particular as concerns respect for privacy, notification of persons concerned, the transfer of
personal data, security and the integrity of the personal data that it holds). Subsequently, the image and
some information regarding a member may be disseminated online. It has happened, and could happen
in the future, that registered members misunderstand the real scope of dissemination which they
agreed to at the time of their registration and by accepting the GTCU. In such a situation, a registered
member may attempt to hold the Group liable for compromising his/her privacy and personal image
rights, which could have an adverse effect on the Group's reputation.
The Group has implemented a policy to filter content and communications shared on its websites
through a flagging system in particular. However, the Group cannot exclude the possibility that its
policy of monitoring correspondence on its websites may be disputed, which could have an adverse
effect on its image, reputation and even the Group's business organisation.
4.3.3
Risks relating to intellectual property
The Group's inability to protect its intellectual property rights may have a material adverse effect on
its development, financial position, results and prospects.
The Group's success is highly dependent on the protection of its brands, domain names, software,
business secrets and copyright. The Group is careful to register its brands, domain names and all other
intellectual property rights in France and abroad, wherever it conducts its business. In particular, it
endeavours to keep in force and strengthen the "Viadeo" and "Tianji" brands, its domain names and its
other intellectual property rights.
However, the Group's brands, domain names and other intellectual property rights may not protect its
current business sufficiently. Within the framework of the Group's geographical expansion, it may also
be advisable to protect the Group's intellectual property in a growing number of countries, without this
necessarily being possible or sufficiently relevant in the new concerned countries.
Furthermore, the Group's brands, domain names and other intellectual property rights may be
successfully challenged or invalidated following administrative or legal proceedings. Third parties
may take legal action against the Group, which could result in the cancellation of all or part of the
Group's brands, domain names or other intellectual property rights, or reduce their scope.
If the Group fails to maintain, preserve or strengthen its brands, domain names and other intellectual
property rights, that could have a material adverse effect on its development, financial position, results
and prospects.
The Group's inability to enforce its intellectual property rights may have a material adverse effect
on its development, financial position, results and prospects.
Any unlawful use or abuse of the Group's brands, domain names or other intellectual property rights
by third parties may damage the Group's value, reputation and business.
22
However, it is possible that third parties may commit acts of infringement or imitate the Group's
brands, domain names or other intellectual property rights, or commit unfair competition or free riding
by using the Group's reputation, in particular in countries which are not as strict in protecting
intellectual property rights as certain countries of the European Union. Accordingly, it may be
necessary to undertake legal proceedings to effectively protect the Group's brands, domain names and
other intellectual property rights, or to determine the enforceability, scope or validity of the intellectual
property rights of third parties. Any legal proceedings brought by the Group may be expensive and
time-consuming, and may have a material adverse effect on the Group's development, financial
position, results and prospects. The Group may not win the proceedings brought, and the damages
awarded (if applicable) may have no commercial value.
As a result, despite its efforts, the Group may be unable to prevent third parties from corrupting its
brands, domain names and other intellectual property rights, or from misappropriating them.
If the Group fails to effectively protect its brands, domain names and other intellectual property rights
from unlawful use by third parties, that could have a material adverse effect on the Group's
The Group's inability to protect and enforce business secrets could have a material adverse effect
on the Group's development, financial position, results and prospects.
It is also important for the Group to guard against the unauthorised use and disclosure of its
technology (including IT solutions), confidential information, expertise and non-patented or nonpatentable information or items, which could represent business secrets that the Group strives to
protect, in particular through confidentiality agreements.
The Group enters into confidentiality agreements with its employees and outsourced companies to
limit access to its business secrets, their disclosure and their use. These provisions, especially of a
contractual nature, may not be sufficient to prevent the misappropriation of the Group's confidential
information. Furthermore, the laws of some countries do not protect business secrets and expertise to
the same extent as laws and regulations in France and the European Union.
However, the Group may be unable to protect its business secrets properly against unauthorised
disclosure, misappropriation, reproduction or use, which could be detrimental to its competitive
position. It cannot be excluded that the Group's business secrets may be disclosed to its competitors,
brought to their knowledge or developed independently by said competitors. In such cases, the Group
would have limited or no rights to suspend the use of said information.
Moreover, insofar as the employees, outsourced companies and third parties working with the Group
use intellectual property rights belonging to third parties to fulfil their duties towards the Group,
disputes could arise as to the intellectual property rights protecting the items created in relation to
these agreements.
Accordingly, the Group cannot guarantee the full protection of its technology, business secrets and
expertise, whether in France or abroad. If, for one of the above-mentioned reasons, the Group's
technology, business secrets or expertise were disclosed or misappropriated, that would compromise
the Group's ability to protect its rights and may have a material adverse effect on the Group's
23
If it is assumed or proven that the Group's intellectual property rights or its business compromise
the intellectual property rights of third parties, that could have a material adverse effect on the
Group's development, financial position, results and prospects.
Third parties may have prior rights (such as trademarks, domain names, trade names, company names,
or more) which are phonetically, visually or intellectually identical or similar to those of the Group.
Accordingly, holders of such rights may act on the basis of their prior rights by committing acts of
infringement, unfair competition or free riding in relation to brands, domain names or other
intellectual property rights used by the Group. Such a possibility may compromise the value of the
Group's brands, domain names and intellectual property rights, and may require it to bear the costs and
risks of the related legal proceedings. In that case, the Group may be required to change the name
under which its solutions are marketed, which could result in a loss of brand recognition and require
the Group to mobilise resources to advertise and market the new brand.
The Group strives to protect its developments, especially in terms of software and databases, by
copyright. However, the Group cannot guarantee that its intellectual property rights will not
compromise third-party rights. Accordingly, a third-party action against the Group could result in a
ban on the use of all or part of a software programme or database used by the Group, and expose the
Group to penalties, which could have a material adverse effect on the Group's business, results and
business continuity. The resolution of such a dispute, which could be achieved through a transaction or
conclusion of a software license agreement in favour of the Group, may generate additional operating
costs which could have a substantial impact on the Group's results. In addition, when developing
software licensed by third parties, the third parties in question may take action against the Group based
on the violation of the terms of the license agreement.
Furthermore, the Group uses certain so-called "free" systems and software to develop certain IT
systems and solutions. These systems and software are made freely available to the public by their
authors under a license which enables users to access the source code, to use it, copy it, change it,
incorporate it into programmes of their own creation, and redistribute it. So-called "free" software is
made available to the public with no guarantees and at the user's own risk. Accordingly, the Group
cannot guarantee the origin of the so-called "free" software which it uses, or guarantee that said
software will not compromise a third party's intellectual property rights. A third party may take legal
action to assert its rights to so-called "free" software. Such action may affect the Group's operations
either by generating additional costs or by forcing the Group to stop using the disputed software and to
recreate new developments. The costs incurred may have a material adverse effect on the Group's
In the future, the Group may face allegations of compromising the intellectual property rights of third
parties. Legal proceedings on intellectual property rights can be expensive and time-consuming. The
outcome is difficult to predict and may require the Group to discontinue some of the features of its
solutions, to purchase licenses or to change its products and features pending the development of
alternative authorised products and features, or even to pay large sums as part of a compromise.
Allegations according to which the Group has compromised intellectual property rights may:


require the Group to pay monetary damages which may be substantial;
prevent it from developing, marketing or continuing to provide some or all of its solutions,
unless it acquires the necessary licenses, in exchange for the payment of fees, from the holders
24
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of the intellectual property rights in question, which could be unavailable or available under
adverse market conditions;
expose it to compensation or repayment obligations towards its current or future customers,
advertising agencies, media and publishing networks and exchanges, and damage its relations
with them;
cause delays or put an end to the supply of its solutions;
prompt its customers, prospective customers, advertising agencies, networks and publishers to
avoid working with the Group;
divert attention and resources from management and the technical staff;
damage its reputation; and/or
force the Group to change its technology or brands, which would require it to incur
considerable expenses and which it may not be able to implement, at least not in an effective
manner.
The Group may lose control of its brands, domain names and ICP licenses if China should cancel
the ICP licenses.
It is important that the Group keeps the ICP (Internet Content Provider) license of the Tianji platform.
Should, for whatever reason, the license be cancelled by the Chinese authorities, Tianji's business
would be compromised.
The Variable Interest Entity (see paragraph 4.4.6 "Risk relating to the Tianji Group's legal structure")
has not been officially approved by the Chinese authorities. Accordingly, this structure remains
exposed to political risks.
The Chinese authorities are currently adopting certain measures aimed at censoring content published
on the Internet. The Tianji platform is dedicated to professionals. However, if users should use the
Tianji platform to publish illegal information, Tianji may be forced to delete such content or those
users' accounts. In the event of serious circumstances, some users may decide to stop using Tianji.
Even if they are resolved without legal proceedings, in the Group's favour or without a compromise
requiring substantial payments to be made, these problems and the time and resources required to
successfully complete or resolve legal proceedings may have a material adverse effect on the Group's
4.3.4
Risks relating to the French Act on Confidence in the Digital Economy
In accordance with the French Act No. 2004-575 Loi pour la confiance dans l’économie numérique of
21 June 2004 (the "LCEN"), and as a host, the Group is responsible for content published by third
parties on its websites. In addition, as a publisher, the Group is also responsible for the content which
it makes available to the public on its websites. Accordingly, the Group is responsible for its websites
and for any press offences (in particular libel) which may be committed on its websites. The Group
also implements content filtering procedures. However, should the Group fail to fulfil its obligations,
it may be ordered to pay damages which could have an adverse effect on its results or financial
position.
The French Loi pour la confiance dans l’économie numérique also establishes the strict liability of
professionals entering into sales or services agreements with consumers, either remotely or by email.
Accordingly, the Group may be sued by its members or customers, for example if the services
rendered to them are unavailable in part or in full, which may force it to incur substantial expenses for
25
related legal representation and may therefore have an adverse effect on its results or financial
position.
4.3.5
Risks relating to online advertising and targeted advertising
The legal regime for business canvassing by email is governed by the opt-in principle (based on the
recipient's prior consent to receive such emails). The Group complies with this requirement and, as
such, the Group's members may not receive marketing emails from the Group's partners, unless they
have granted their express prior consent to receive such emails. However, the Group cannot exclude
the possibility of a legal dispute regarding the transmission of personal data to its partners and the use
made by its partners of such data, in particular in terms of business canvassing. Accordingly, the
Group may be ordered to pay damages which may have an adverse effect on its results or financial
position.
Furthermore, the regulation provides that the websites must obtain the consent of Internet users before
implementing tracking systems, such as cookies, on users' IT systems. In practice, the use of cookies
requires a message to be displayed when the Internet user logs on to the website for the first time,
explaining how to accept or decline cookies. The Group complies with this requirement and a banner
is displayed on the screen when cookies are placed in an Internet user's IT system. However, the
Group cannot exclude the possibility of a legal dispute concerning its use of this type of tracking
system. Accordingly, the Group may be ordered to pay damages which could have an adverse effect
on its results or financial position.
4.3.6
Risks relating to the ownership of the Group's databases
The Group owns the Viadeo platform membership database, on the basis of having initiated its
creation and having devoted substantial financial, equipment and human resources to developing,
checking and presenting said database. The Group also owns the Tianji platform membership database
through the contractual agreements which grant it control of Yingke in accordance with applicable
regulations in China (as described in section 7.2 of this document de base).
However, the Group cannot exclude the possibility of its partners having claims to the data of
members who used the Group's services via its partners' websites. The Group may incur substantial
expenses to complete the necessary checks and obtain legal representation in the event of legal
proceedings, which may have an adverse effect on the Group's results or financial position.
4.3.7
Risks relating to the regulations of foreign countries
The Group's business is subject to the laws and regulations applicable in France, the European
Union and foreign countries (in particular Russia and China) which are liable to change and a
number of which may at times be under development and may lead to the Group being targeted by
complaints or cause damage to its business.
Generally speaking, the Group's business is subject to the risk of changes in legislation, tax policy or
regulations in its various countries of operation. These changes in legislation, tax policy or regulations
may have a material adverse effect on the Group, its business, prospects, financial position, results and
development.
Furthermore, the risk relating to the national regulations in foreign countries concerns the Group as it
26
does all companies operating one or more websites. Due to the open nature of the Internet, and in
particular the fact that Internet users from all over the world can access a website, the Group cannot
exclude the possibility that its websites' content and offer may not comply with a law applicable in a
foreign country. It is also possible that the content and offer of the Group's websites may not comply
with a law applicable in a foreign country in the future, especially given that these provisions may
change over time and that new laws and regulations targeting in particular the protection of consumers
or with a restrictive effect on the use of the Internet may be adopted in the various countries
concerned. Moreover, the various laws and regulations imposed on the Group may be contradictory
and, even if the Group is in compliance with the laws of one country, it may infringe on the laws of
another country.
Legislative and regulatory changes also require the Group to incur considerable expenses to comply
with the new laws and regulations and may require the Group to adapt its services and solutions, and
to change its sales policy. These changes may require considerable time and effort from management
and could make the Group the target of complaints and other remedies, which may have an adverse
effect on the Group's revenue and results.
In addition, the Group cannot exclude the possibility that it may be held liable in a criminal or civil
court, in particular based on national provisions regarding consumer protection. If the Group is held
liable on account of these foreign rights or if the Group is unable to comply with them, that would
generate costs related to the necessity of legal representation for such disputes, or even damages
resulting from a conviction, and may prompt the Group to revise its sales policy based on local
imperatives. This could require the Group to mobilise considerable resources or to stop offering
certain solutions, which could harm the Group's business, financial position and results.
The majority of agreements entered into by the Group are subject to foreign law. The Group cannot
guarantee that some of the clauses of these agreements will not be disputed or lead to legal
proceedings based on the national law concerned, or even that the provisions of this law will not serve
as a basis for proceedings restricting the Group's exercise of its business in the country in question.
4.4
RISKS RELATING TO THE GROUP'S ORGANISATION
4.4.1
Risks relating to the Group's stage of development
The Group is relatively young, which makes it difficult to assess its future prospects.
The Group was created in 2005 and operates in a fast changing market. It may therefore be difficult to
assess its future prospects.
The Group has encountered and is liable to encounter the risks and difficulties which companies with
strong growth potential are frequently faced with and notably: difficulties in establishing exact
estimates and deciding the best way to invest the limited resources which the Group possesses, having
its existing and future solutions accepted by the market, managing the implementation of its
innovations and developing new innovations.
Investors are therefore advised to examine the Group's activity and prospects in the light of the risks
and difficulties with which it is confronted on this rapidly changing market. Amongst these risks and
difficulties there is the Group's ability to:

increase the number of its registered members and their commitment;
27
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avoid interruptions and disruptions to its services, and longer than planned loading time on its
websites;
develop an evolving high-performance technological infrastructure able to reliably and
effectively manage the increased speed of its sites, and the rollout of new functions and
products;
use the data its members communicate to it responsibly to offer them solutions so they can be
more successful and productive, and satisfy the recruitment and marketing needs of its current
and future clients;
increase the revenue from the services offered by the Group;
continue to win and keep the trust of its members with regards to their reputations and
professional information;
process, store and use personal data in accordance with the laws and regulations which apply
in each country concerned;
identify, recruit, integrate and retain national or international talent; and
successfully grow the Group's business especially internationally through a multi-local
strategy.
The Group's activity, prospects, financial position, results and development may be materially affected
if the market for professional networking sites did not develop in accordance with the Group's
expectations, or if the Group did not succeed in satisfying the needs of this market.
4.4.2
Risks relating to the Group's internationalisation
The Group has had an international presence since 2007 when the London-based subsidiary, Viadeo
Limited, was founded. As at the filing date of this document de base, the Group is present in eight
countries through its different subsidiaries (for more information refer to the legal organisation chart in
section 7.1 of this document de base). The Group's internationalisation has also been helped by
providing the http://de/Viadeo platform in many other languages besides French, whilst the Tianji
platform is mainly available in Chinese.
In 2012 and 2013, the Group's revenue from operating activities realised outside France represented
3.7% and 5%, respectively of its revenue. However, it should be noted that the Group is still in the
phase of constructing its position in terms of number of members and use in these markets. The
Group's international activities require a lot of input from its senior management as well as significant
financial resources. There are various risks associated with this international expansion, including:
 the supply of services in different languages and cultures, within the context of the Group's
"multi-local" strategy, which involves taking the specificities of the countries or regions
where it is present into account in an efficient manner;
 unexpected changes in regulatory requirements, taxation, commercial laws, customs tariffs,
export quotas, customs duties or other commercial restrictions;
 the difficulty in identifying, recruiting and retaining talented and competent employees in
foreign countries;
 the difficulties inherent in managing an increasing number of employees over large
geographical distances;
 the differences in social security legislation in different countries;
 the unstable and changing political or economic situation in a country or a region where the
Group operates, especially in China, Africa and Russia;
 the high levels of fraud associated with electronic payments;
 the Group's difficulties in recovering the sums which are owed to it by its customers in a
timely manner in countries where it may only possess limited rights of recourse;
28
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the limitations on the Group's ability to reinvest the profits from its operations in a country to
finance the capital requirements of its operations in other countries;
fluctuating exchange rates;
possible double taxation of international revenue and other adverse consequences due to
changes in taxation law in France or in the foreign countries where the Group is present;
the increase in costs relating to the Group's presence abroad;
the changes in the legislation from one country or region to another in terms of data
protection or unauthorised access to and use of commercial and personal information;
limited or unsatisfactory protection of intellectual property in some countries; and
the restrictions on repatriating profits.
If revenue from the Group's international operations, especially its operations in the three geographical
regions of Africa, China and Russia in the medium term, was not higher than the expenditures required
for establishing and maintaining these operations, this could have a material adverse effect on the
Group's business, prospects, financial position, results and development.
4.4.3
The Group could lose key employees and may be unable to attract new qualified
employees at the rate required
If the Group did not keep its management team and its key employees or did not attract other talent,
it might be unable to sustain its growth or attain its sales targets.
The Group's success is partly based on the expertise and commitment of its main employees and senior
management, especially in China.
The Group considers that at least some of the tasks performed by these key employees could be
performed by other employees if necessary, after a period of adaptation and/or training. However,
given that the Group's success is notably linked to the past and present work of its key employees, the
Group cannot guarantee that their departure or unavailability would not have a material adverse impact
on its business, prospects, financial position, results and development.
The Group will also have to recruit new executives and qualified technical and commercial staff to
develop its business. The Group is in competition with other French and foreign companies to recruit
and retain highly qualified technical, commercial and management staff. As this competition is very
intensive, the Group may not be able to attract and keep this key staff under acceptable economic
conditions. The Group's inability to attract this key staff may prevent the Group from achieving its
targets and therefore may have a material adverse impact on its business, prospects, financial position,
results and development.
4.4.4
The Group's development will depend on its ability to manage its growth
If the Group failed to manage its growth effectively, its business, prospects, financial position,
results and development could be negatively affected.
The Group's workforce and business are growing rapidly, which should continue to require the full
commitment of its management and its operational and financial infrastructure. As it grows, the Group
must effectively integrate, develop and motivate a large number of new employees, whilst preserving
its corporate culture. The Group intends to continue to invest large sums in order to broaden its
research and development activities, its sales force, its administrative organisation and its international
activity. The Group will therefore have to recruit additional staff and develop its operational capacities
29
which could significantly mobilise internal resources. In order to attract the best talent, the Group has
had to offer and must continue to offer competitive remuneration before it has assessed the
productivity of the employees concerned. The risks of over-recruitment or under-payment and the
difficulties of integrating a rapidly increasing workforce are exacerbated by the Group's international
expansion. In addition, the Group may not succeed in hiring new employees fast enough to satisfy its
requirements. If the Group did not succeed in effectively managing its requirements to recruit and
integrate its new employees, its effectiveness and ability to achieve its forecasts, the morale and
productivity of its employees or its capacity to keep them could be affected, and this could have a
material adverse effect on the Group's business, prospects, financial position, results and development.
In addition, if the Group did not manage the growth of its activities effectively, the quality of its
solutions could suffer, which could harm its brand and have a material adverse effect on the Group's
business, prospects, financial position, results and development. In order to manage this growth
effectively the Group must continue to improve its operational, financial and management controls as
well as the reporting systems and procedures by taking measures such as the following:
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
train, manage, motivate and retain a growing number of employees;
anticipate the expenditures associated to growth, as well as the related financing requirements;
increase and improve the capacity of its existing operational, financial and management IT
systems;
improve its operational efficiency to obtain a satisfactory profitability level;
reinforce its information and communication systems so that all employees and offices are
coordinated and can communicate effectively with each other and with the growing members
base; and
strengthen internal controls to ensure the reporting in a timely manner of all the transactions
carried out by the Group or on its websites.
These reinforcements and improvements to the Group’s systems will require large capital expenditures
and the mobilisation of management and staff.
The Group's past growth rates may not be indicative of its future growth.
Historically, the Group has had strong growth, which has been reflected by a rapid increase in the
profiles bought online on the http://plateformes/Viadeo and Tianji platforms. The continuation of
this growth partly depends on the Group's ability to effectively manage such growth and to make the
human, technical and technological investments required to keep abreast of the increase in traffic
generated by the growing number of profiles which can be consulted, on the basis of numerous search
criteria which are liable to be refined further in the future, whilst ensuring the corresponding growth in
the teams which assist members and customers, all in several languages. If the Group's management
encountered difficulties in managing this growth, the Group's revenue, results, financial position and
growth prospects could be negatively affected.
Thus, the Group may not be able to maintain the overall growth in its revenue at the same level as it
has recently experienced or sustain this growth. In the future the Group's revenue could increase more
slowly than in the past, or even fall. The growth in the Group's revenue depends on a certain number
of factors, including the Group's ability to:
 enlarge its members' base and attract new customers;
 adapt its solutions to the changing requirements of professional users and companies including
to track market trends such as the migration of Internet users to mobile appliances;
 ensure its websites function correctly;
30
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adapt to a changing legislative landscape regarding confidentiality issues;
reinforce the growth of the Group's brands across the world; and
attract new recruits and keep them.
The Group cannot guarantee that it will succeed in achieving these objectives. In addition, the Group
could be faced with unexpected expenses, difficulties, complications, delays and other factors which
are unknown at present. If the Group failed to increase its revenue sufficiently to offset the rise in its
costs, it might be unable to sustain the recent global growth in its revenue, or guarantee profitability.
Thus, the Group's inability to manage its growth or the unexpected problems encountered during its
expansion may have a material adverse effect on its activity, business, financial position, development
and prospects.
Some of the Group's key performance indicators (use indicators1) are measured by internal tools
and are not subject to independent checks. Inaccuracies related to the complexity of measuring
these indicators could have a material adverse effect on the Group's development, financial
position, results and prospects.
The Group monitors certain key performance indicators (use indicators 1) through internal tools which
are not checked by an independent third party. The Group's internal tools have some limits and the
Group's methods for monitoring these indicators may be changed in the future, which could lead to
unexpected changes in the Group's indicators, including the indicators released by the Group. If the
internal tools used by the Group to monitor these indicators were to under- or overestimate the Group's
performance, or if they contained technical errors, in particular regarding the algorithm used, the data
released by the Group could be inaccurate. Errors made in terms of the assessment of key performance
indicators could affect the Group's sound understanding of certain data relating to its business, which
may have a negative effect on the Group's long-term strategies. If the Group's key performance
indicators do not provide an accurate representation of the Group's membership base or of their levels
of commitment, or if the Group finds material inaccuracies in its indicators, that could have a material
adverse effect on the Group's development, financial position, results and prospects.
4.4.5
Risks relating to growth through acquisitions
In the past, the Group has acquired several third-party companies and assets which are detailed in
paragraph 5.1.5 of this document de base. It may acquire new companies or technologies in the future.
The Group cannot guarantee that it will be able to identify the best opportunities and perform these
acquisitions or that it will successfully integrate the companies or technologies acquired. Any problem
the Group encounters in integrating third party companies or technologies may have a material adverse
effect on the Group's business, financial position, results, development and prospects.
In addition, the acquisition of third party companies or technologies could involve the Group outlaying
significant costs. The Company may also have to finance such acquisitions by taking out loans or
issuing shares which may result in financial risks or certain restrictions or have a dilutive effect for its
shareholders.
The Group's business, financial position, results, development and prospects may be materially
affected by the realisation of one or more of these risks.
1Use
indicators refer to the indicators monitored by employees in the "Business Analysis" team, as described in section
6.4.5.2 of this document de base (measurement of the audience, use, traffic, registrations, etc.).
31
4.4.6
Risk relating to the Tianji Group's legal structure
The Group could face heavy penalties if the Chinese authorities were to consider that the
contractual agreements enabling the Group to run its business in China do not conform to the
Chinese laws and regulations in force.
As Chinese laws and regulations limit the interests which foreigners can take in companies in the
value added telecommunication sector, the Group runs its business in China through a series of
contractual agreements concluded with Beijing Yingke Times Information Technology Co., Ltd.
("Yingke"), a company under Chinese law, owned by Xiaojie Wu and Yingshou Guo. Yingke holds
the authorisations, permits and franchises required for running the Group's activity in China. In this
context, Tianji Boren Technology Development (Beijing) Co., Ltd. ("Boren"), the Group's 100%
Chinese subsidiary concluded a series of contracts with Yingke and its two shareholders, enabling the
Group to exercise de facto control over Yingke. Because of this, it is considered to be a variable
interest entity under Chinese law, and its operating profit is consolidated with the Group's.
Although the Group considers that it is in compliance with the Chinese laws and regulations in force,
it cannot be ruled out that the Chinese authorities may consider that these contractual agreements do
not conform to the requirements relating to authorisation, declarations and other regulatory
requirements, or to the procedures currently in force, or to requirements and procedures adopted in the
future. The Chinese laws and regulations governing the validity of these contractual agreements are
difficult to interpret and the competent administrative authorities have complete freedom in the way
they interpret these laws and regulations.
If the Chinese authorities considered that the Group was not in conformity with the laws and
regulations in force, they could cancel the Group's operating licenses, demand that the Group ceases or
restrains its business activity, limits its right to receive revenue, demand the restructuring of its
business, impose additional terms or requirements which the Group may not be able to satisfy, or take
other regulatory or coercive measures against the Group, which could have an adverse effect on its
activity. If one or more of these measures was taken, this could have a material adverse effect on the
Group's business, prospects, financial position, results and development.
The contractual agreements concluded with Yingke and its shareholders and on which is based
the control exercised by the Group might not guarantee a control as effective as a direct interest
in this company's capital.
The contractual agreements with Yingke and Yingke's shareholders may not guarantee a control of
Yingke which is equivalent to a direct interest in its capital. If the Group held a direct interest in
Yingke's capital it could participate in this company's management by exercising its shareholders
rights. Conversely, the Group's contractual control over Yingke depends on Yingke and its
shareholders correctly performing their contractual obligations under the agreements concluded with
the Group. Yingke's shareholders may not act in the Group's interests or may not honour their
obligations under these contractual agreements, and notably the obligation to renew these contractual
commitments when they expire. If there were a disagreement between the parties over the performance
of this agreement, the Group would have to assert its rights in accordance with Chinese laws before
Chinese courts and would therefore be subject to the hazards of the Chinese legal system. These risks
will last as long as the Group continues to run its business in China through contractual agreements
made with Yingke and its shareholders in order to comply with the applicable legislation.
32
Any non-performance by Yingke or its shareholders of the contractual obligations binding them
under the terms of the contractual agreement concluded with the Group may have a material
adverse effect on the Group's business.
Under Chinese contract law, a contract which is legally made is binding the parties, and is protected
by law and requires the parties to perform their obligations in compliance with its terms. However, it
is not certain that the Group could enforce specific performance of these contractual agreements if
Yingke or its two shareholders breached their obligations under the terms of these contractual
agreements. The procedures involved in enforcing the performance of such obligations could result in
substantial costs for the Group which would have to apply the legal remedies stipulated by Chinese
law, irrespective of whether this involves applying for the specific performance of these agreements,
or damages. Such remedies may not be applicable or effective in this case. For instance, if Yingke's
shareholders refused to transfer the shares they hold in Yingke to the Group when the Group wished to
exercise a promise for sale it holds under the contractual agreements, or if one of Yingke's
shareholders acted in bad faith towards the Group in any way whatsoever, or if Yingke failed to
honour its payment obligations towards the Group, the Group would have to bring a legal action to
force them to perform their respective obligations.
All these contractual agreements will therefore be interpreted in accordance with Chinese law and any
disagreement between the parties would be settled in accordance with legal procedures in force in the
People's Republic of China. The Chinese legal and judicial system is not as developed as other
jurisdictions such as the United States or certain countries in Europe. Consequently, certain risks in the
Chinese legal and judicial system could limit the Group's ability to obtain performance of these
contractual agreements. If it transpired that the Group could not obtain specific performance of these
contractual agreements, it would be unable to exercise a contractual control over Yingke, its capacity
to manage its business would be significantly affected and the Group might not be able to consolidate
the financial results of its subsidiaries in its consolidated financial statements.
The Chinese tax authorities could inspect the contractual agreements concluded between Boren,
Yingke and Yingke's shareholders, with unfavourable tax consequences for the Group and
penalties within the scope of possible tax deficiency assessments resulting in a significant
reduction in the Group's consolidated revenues in the future.
In accordance with Chinese laws and regulations, the contractual agreements and transactions made
between related parties can be audited, controlled and contested by the Chinese tax authorities. The
Group could suffer unfavourable taxation consequences if the Chinese tax authorities considered that
the prices in the contractual agreements concluded between Boren, Yingke and Yingke's shareholders
did not reflect market prices, and if they revised Yingke's revenues by correcting transfer pricing. A
correction in transfer pricing could lead to, amongst others, the reduction in the deductible expenses
recorded by Yingke, with a resulting increase in its tax charge. In addition, the Chinese tax authorities
could inflict the payment of a late payment penalty and other fines on Yingke during a tax deficiency
assessment. The Group's net consolidated revenue could be unfavourably impacted if Yingke's tax
charge increased, or if Yingke was the subject of late payment penalties or other fines.
33
The consolidated financial data for the Group’s operations in China are presented in note 2.23 of
section 20.1 of this document de base.
4.5
INSURANCE AND COVERAGE OF RISKS
The Group has implemented a policy of covering the main insurable risks relating to its business
activity with levels of cover that it considers compatible with its type of activity and will continue to
apply the same policy within the scope of the future development of its business. The insurance
policies taken out by the Group contain exclusions and guarantee limits as well as the deductibles
usually imposed by insurance companies on the market.
These policies mainly cover the risks relating to the Group's professional indemnity as well as its
corporate executives' professional indemnity:
Insurer
Type of policy
Amount covered
Deductible
AXA
Professional indemnity
(Lyon offices)
€165,166
€276.24
€2,069,502
€276.24
€1,003,805
€276.24
€3,000,000
€25,000 at maximum
(offices at 30 rue de la
Victoire)
(offices at 65 rue de la
Victoire)
AXA
AXA
Chartis Europe
4.6
of its corporate executives
LITIGATION RISKS
There are no governmental, legal or arbitration proceedings, including any proceedings which the
Company is aware of, which are left unresolved or pending, and which are liable to have, or have had
a significant impact on the Group's financial position and profitability during the last 12 months.
4.7
FINANCIAL RISKS
Also refer to Note 26 of the notes to the consolidated financial statements in section 20.1 of this
document de base.
4.7.1
History of losses – specific risks relating to projected losses
Since its creation in 2005, the Company has recorded operating losses which are explained both by the
innovative technological nature of the platforms developed, which require significant up-front
investment to offer and develop the service, and by the efforts made to geographically deploy the
offer.
34
The total "reserves and accumulated losses" at 1 January 2012 (representative of the level of losses
before 2012) and the accounting losses for the fiscal years 2012 and 2013 totalled €33.8 million
(consolidated financial statements prepared under IFRS).
The Group's accumulated operating losses for the last two fiscal years ended 31 December 2012 and
2013 totalled €23.1 million, including a €14.5 million operational loss for the fiscal year ended 31
December 2013 (consolidated financial statements prepared under IFRS).
The Group could experience additional operating losses in future years, within the scope of the
commercial and technological development required for its business, in accordance with:
-
technical and IT development expenditures to integrate future technological changes into its
platforms and enrich the offer's content;
possible unplanned additional costs and slower than anticipated progress in certain strategic
regions like China;
future marketing expenses, according to the degree of advancement of the commercial
deployment of its offers in different geographical regions and to competitive pressure.
4.7.2
Liquidity risk – future requirements for capital and additional financing
Since its creation, the Group has financed its growth by strengthening its shareholders' equity through
successive capital increases, by issuing bonds redeemable in shares or cash (redeemed in full in May
2012), by issuing three bonds convertible into shares in January 2014, February 2014 and May 2014,
whose characteristics are described in paragraph 21.1.4.2 of this document de base, by obtaining
public innovation and development grants, through the Research Tax Credit, and through bank loans.
The development and the upgrading of the Group's technologies, as well as the deployment of a sales
force adapted to its expansion will generate even larger financing requirements.
Faced with the limitations of financing its growth internally, the Group is looking for other sources of
financing, especially through new capital increases.
The Group may not be able to obtain the additional capital when needed, or this capital may not be
available under acceptable financial terms for the Group. If the necessary funds were unavailable, the
Group might have to slow down its technological development efforts and its commercial and
development efforts on new markets.
As at the filing date of this document de base, the Group has performed a specific review of its
liquidity risk, and considers that it is able to meet its future obligations over the next 12 months.
The realisation of one or more of these liquidity risks could have a material adverse effect on the
Group, its business, financial position, results, development and prospects.
4.7.3
Foreign exchange risk
The Group's activities are performed abroad and it is therefore subject to the exchange risk from
different exposures in currencies other than the euro, which is the Company's functional currency, and
the currency of presentation for the Group's consolidated financial statements.
35
Operating result and the assets of Chinese and Russian entities in particular, as well as the Group's
liquidities are subject to exchange rates fluctuations, primarily to fluctuations in the Euro/Yuan,
Euro/Rouble and Euro/US Dollar exchange rates.
The main transactions in US dollars are mainly realised by the Group's US based subsidiary, APVO.
There is no mechanical correlation between the expenditures denominated in US Dollars (all the costs
of the APVO subsidiary) and the proceeds from subscriptions on the Group's behalf (mainly in Euros,
but also in Pounds Sterling, US Dollars and Dirham). It therefore cannot be ruled out that the Group
will be confronted with fluctuations in the US Dollar in the medium and long-term.
If there were a 10% variation in foreign exchange rates, the impact on the Group’s profit/loss before
tax and on its shareholders’ equity would be as follows:
In thousands of euros
Impact on profit before tax
Impact on shareholders' equity
10% increase
10% decrease
10% increase
10% decrease
USD
(361)
361
664
(664)
CNY
(655)
655
428
(428)
non significant non significant
non significant
non significant
1,092
(1,092)
Other currencies
TOTAL
(978)
978
The exposure to fluctuations in exchange rates is reduced for the fiscal years 2012 and 2013 because
of the relative weight of the Chinese segment in the Group's financial statements. The exposure to
fluctuation in this sector in future fiscal years could be reduced naturally by cash inflows and outflows
in the same currency.
The Group did not carry out any hedging transactions in 2012 and 2013.
Despite a mechanical correlation between the expenditures in Yuan (mainly comprising staff
expenses) and sales in China, it cannot be excluded that in the medium or long term, the Group will
face variable exposure connected to fluctuations in the Yuan, for purchases which could be realised
outside China.
Furthermore, the Group's net foreign exchange position at 31 December 2013 is as follows:
Assets
FY 2013
Liabilities
Foreign
excluding
currency
shareholders' commitments
equity
(b)
(c)
Net position
before hedging
(d) = (a) – (b)
+/- (c)
Hedging
instruments
(e)
Net position
after hedging
(f) = (d) – (e)
In thousands
of euros
(a)
Euros
7,155
8,076
-
(921)
-
(921)
Yuan
5,149
868
-
4,281
-
4,281
Dollar
21,871
15,325
-
6,546
-
6,546
470
(135)
34,645
24,134
Other
currencies
TOTAL
-
605
10,511
-
Based on euro/foreign currency exchange rates at the 2013 closing date:
36
-
605
10,511
-
a 5% appreciation in the euro would have a negative impact of €204K on the net yuan position
and of €312K on the net USD position;
a 5% depreciation in the euro would have a positive impact of €225K on the net yuan position
and of €345K on the net USD position.
4.7.4
Credit risk and cash management risk
The Group has a prudent cash management policy. Cash and cash equivalents comprise cash and
current financial instruments held by the Group. These mainly comprise money market funds and the
Group is not exposed to a risk on equities or other financial instruments. At 31 December 2013, cash
and marketable securities held by the Group were invested in products with a maturity of less than 12
months.
The credit risk with respect to cash, cash equivalents and other current financial instruments is not
material with respect to the quality of the financial institutions which the Group uses (HSBC and
Société Générale).
The Group considers that it is not faced with a significant concentration with respect to its customers,
as no single customer individually represents more than 10% of the Group's revenue. The
concentration of the credit risk relating to trade receivables is therefore limited due to the diversified
and unrelated customers (recruitment professionals, advertising professionals and subscriptions). As at
31 December 2013, the contribution of the first, first five and first ten customers to the Group's
revenue amounted to 2%, 6% and 9% respectively, compared to 3%, 7% and 11% as at 31 December
2012. These main customers concern the Recruitment and training services division. They are
recruitment agencies representing various end customers.
In addition, at 31 December 2013, less than 1% of the Group's trade receivables were considered to
present a collection risk. These receivables were therefore depreciated in the Group's consolidated
financial statements.
In addition, in January 2009, the Company concluded a factoring agreement with GE Factobail for
French receivables enabling it to optimise the management of its trade receivables. At 31 December
2013, the cash received in exchange of factored receivables amounted to €2,000K.
The Group pledged marketable securities in the amount of €452K when it took a lease for the new
premises of its registered office in June 2013 for the term of the lease, to guarantee its performance.
The pledged sums are presented as non-current financial assets in the Group's consolidated financial
statements.
4.7.5
Interest rate risk
As at the filing date of this document de base, the interest rate risk exposure concerns the investment
of cash in cash equivalents, primarily money market funds (SICAV, €1,031K at 31 December 2013),
fixed rate bank loans (€602K at 31 December 2013), and bonds issued in January, February and May
2014 (for an amount of €10,550K with a 9% interest rate), also subscribed at a fixed rate.
The Company considers that any change in interest rates by +/- 1% would have an immaterial impact
on its net result with regards to losses generated by the operational activity.
4.7.6
Other risks relating to debt
37
The Group took out a €450K loan with HSBC France in December 2010 redeemable over 60 months,
with the Group pledging its business goodwill as security for repayment. In addition, this loan includes
covenants requiring the respect of several financial provisions.
These covenants concern:
- Maintaining total equity at a minimum of €15K;
- Respecting an equity/total assets ratio > 20%; and
- Respecting a financial expenses (adjusted for lease financing)/EBITDA ratio lower than <
30%.
Breach of any covenant gives the lender the option of demanding the early repayment of the loans. At
the end of the year end 2013, the Group was in compliance with the ratios in the banking
documentation and the sums to be repaid regarding this loan totalled €242K.
No other loan taken out by the Group includes such covenants.
4.7.7
Risks relating to public financing
The Company had benefited from a repayable advance and two Coface business development
insurance contracts.
In June 2009, Oseo granted the Company a repayable advance of an initial amount of €490K. The
outstanding balance repayable at 31 December 2013 was €230K in accordance with the repayment
schedule in note 12.2 of the consolidated financial statements in section 20.1 of this document de base.
In May 2009 and May 2011, Coface concluded two business development insurance contracts with the
Company relating to its development in India and Mexico, on the one hand, and in Africa on the other.
At 31 December 2013, the Company had received a total of €730K in advances including €718K
remaining to be repaid. The repayment dates are annual and variable, calculated in accordance with the
revenue earned in the geographical regions concerned. The 2014 repayment for India and Mexico
calculated on 2013 revenue should not be significant. With regards to Africa, the contract provides for
a first repayment in 2015 only.
If the Company failed to respect the contractual conditions of the Coface agreement’s general terms
(in particular disclosure and periodic reporting obligations), it may have to repay the sums advanced
early.
Furthermore, the terms and conditions of the Coface agreement for India and Mexico (companies
whose business was discontinued in 2013) include the possibility for Coface to terminate the contract
in the event of the business being discontinued and demand early repayment.
For India and Mexico, the total amount to be repaid would be €390K.These situations could deprive
the Group of certain financial resources required to successfully perform its development projects.
4.7.8
Risks relating to the Research Tax Credit
In order to finance its business activities, the Company receives a Research Tax Credit ("CIR") in
France which consists in the government offering a tax credit to companies which make significant
investments in research and development. The research expenditures eligible for the CIR notably
include salaries and wages, depreciation of research equipment, services subcontracted to approved
(public or private) research organisations and intellectual property costs.
The CIR is deducted from the tax payable by the Company, and if not, is paid within three years.
38
In 2013, the Company received a payment from the French Treasury in the amount of €663K for the
Research Tax Credit with respect of the fiscal year 2011. At 31 December 2013, the Company had a
CIR receivable from the French Treasury of €1,518K with respect to fiscal years 2012 and 2013.
The last tax audit concluded in 2012 for the fiscal years 2008, 2009, and 2010 did not result in a tax
deficiency notice.
It cannot be ruled out that the tax authorities would call into questions the Company's methods for
calculating research and development expenses or that the CIR would be challenged by a change in the
legislation or a dispute by the tax authorities, even though the Company complies with the
requirements regarding documentation and eligibility of expenditure. If such a situation occurred, this
could have an adverse effect on the Company's results, financial position and prospects.
4.7.9
Risks relating to future use of tax losses carried-forwards
At 31 December 2013, after taking 2013 losses into account, the Group had tax losses which are
eligible to be carried forward:
- indefinitely in France, in the amount of €8,605K;
- over 20 years in the United States, in the amount of US$9,760K (€7,077K);
- over five years in China, in the amount of KCNY105,749 (€12,665K).
In France, the deduction of losses is capped at 60% of taxable profit for the year and this limitation is
applied to the fraction of profit in excess of €1 million. The unused amount of the loss can be carried
over to subsequent fiscal years and is deductible under the same conditions, without any time
limitation. However, in the United States and China, there is a time limit for using these losses.
It cannot be ruled out that any changes in the future relating to:
- firstly, the Group's ability to realise tax profits in future fiscal years, within a timeframe,
which enables it to absorb existing losses in the United States and China;
- and secondly, corporate taxation rules;
would call into question either all or part of the possible deduction of these prior losses against future
profit or reduce the time limit for their utilisation. Out of the total tax losses carried forward of
€28,347K at the year end of 2013, the Group only recognised deferred tax for its US subsidiary APVO
totalling €5,337K. This amount is based on a three-year tax planning which is reviewed at each year
end.
4.7.10 Risk relating to the existence of dilutive instruments
As part of its policy to incentivise its executives and employees, the Company has from its creation
regularly issued or awarded stock warrants (BSA) and Founders' warrants (BSPCE), some of which
are already exercisable. If all the instruments giving access to issued capital (which have not expired
or been forfeited as at the filing date of this document de base) were exercised, this would enable the
subscription of 1,427,900 new shares, as described in paragraph 21.1.4.1 of this document de base,
generating a dilution of 15.33% of the capital, on a fully diluted basis, and 18.11% on the basis of the
current capital on the date of this document de base.
To this dilution could also be added the dilution from the possible conversion of the convertible bonds
outstanding to date, the main terms of which are described in paragraph 21.1.4.2 of this document de
39
base. As the conditions for conversion depend on the future stock market listing price, the maximum
impact of this potential additional dilution will be presented in the future securities note.
In the future, the Company might issue or grant shares or new financial instruments conferring rights
to Company shares as part of its incentive policy for its executives and staff. The result of this would
be an additional, potentially significant dilution for the Company's shareholders.
Furthermore, the delegations of authority granted to the board of directors by the general shareholders'
meeting of 21 May 2014 with a view to performing one or more capital increases (including shares
that may be issued as part of the Company’s IPO), details of which are included in section 21.1.5 of
this document de base, concern an overall maximum amount of 88.78% of the share capital at the
registration date of this document de base.
5
INFORMATION REGARDING THE COMPANY
5.1
HISTORY AND DEVELOPMENT OF THE COMPANY
5.1.1
Corporate name of the Company
The Company's corporate name is Viadeo.
5.1.2
Company's place of registration and registration number
The Company is registered in the Paris Trade and Companies' Register under number 487 497 414.
5.1.3
Date and term of incorporation
The Company was incorporated for a period of 99 years ending on 14 December 2104, unless
dissolved in advance or extended.
5.1.4
Company's registered office, legal form, legislation governing its activities
Initially incorporated as a private limited liability company (société à responsabilité limitée), the
Company was converted into a limited liability company (société anonyme) with a board of directors
by the general shareholders' meeting of 22 June 2006.
The Company is governed by current and future legal and regulatory provisions, in particular the
French Code of Commerce and its amending acts, in addition to its bylaws.
The Company's registered office is located at 30 rue de la Victoire 75009 Paris
The Company's contact details are as follows:
Tel.: +33(0)1 75 44 31 24
Email address: mailto:[email protected]@viadeo.com
Website: www.viadeo.com.
Corporate website: http://corporate.viadeo.com/fr/
40
5.1.5
Highlights in the Company's development
2004
In order to simplify exchanges between members of Club Agregator, which they
founded, Thierry Lunati and Dan Serfaty decide to create a web-based communication
platform between the various partners.
2005
December: The company Viaduc Sarl is created; Agregator contributes the assets of the
previously designed and developed network.
2006
June:
First fundraising of €5.1 million, primarily from IdInvest Partners (formerly
AGF Private Equity) and Ventech, intended to fund the platform's European
development.
January:
The network has 1 million members and a platform available in six languages;
January:
The English subsidiary Viadeo Limited is created;
August:
Viaduc changes its name and becomes Viadeo;
Second fundraising of €5 million among IdInvest Partners (formerly AGF
Private Equity) and Ventech against the background of booming international
development;
October:
Acquisition of an 11% interest in CBC (ChinaBizNetwork Corp.), a holding
which groups together the historical shareholders of the Chinese professional
network Tianji (Beijing).
February:
Acquisition of the Chinese website Tianji through the acquisition of 100% of
the Wayson Technology SecuritiesDevelopment based in Hong Kong, funded
by a convertible bond issue reserved for China Biznetwork Corp (of which the
Company holds an 11% interest);
July:
Acquisition of ICTnet, a Spanish community-oriented business website.
February:
The Mexican subsidiary Viadeo Mexico is created;
2007
2008
2009
May/June: Third fundraising of approximately €3.4 million among Ventech, IdInvest
Partners, V109, and 3 Rivières;
June:
€490K is obtained from Oseo as a grant for innovation purposes, intended to
develop the Viadeo interface with other platforms and software on the market;
July:
Acquisition of 100% of the capital of Apnacircle, which develops socioprofessional networks in India, fully funded by Viadeo securities;
Capital increase by converting bonds as payment for the acquisition of Wayson
Technologies (Tianji);
41
December: Acquisition of 100% of the Canadian website UNYK (subsidiary dissolved in
December 2011 after its members were integrated into the Viadeo platform)
which had nearly 16 million members, mainly in South America and Europe.
Unyk offered a simple social network service based on a "smart address book"
technological brick; this acquisition was fully funded by Viadeo securities.
2010
August:
A subsidiary entirely based in San Francisco is created, which is provided with
Viadeo's technological platform (the website and all software developments, the
database and technical interfaces between the website and database);
December: The Group's network has 32 million members.
2011
August:
The Moroccan subsidiary Viadeo Maroc is created;
October:
A joint venture is created in Russia with the Russian media group Sanoma to
develop the Viadeo platform in Russia; the Company and Sanoma each hold
50% of the joint venture's capital;
December: Acquisition of 100% of Soocial, fully funded by Viadeo securities. This Dutch
company developed a website for managing address books, of which the
technological bricks have since been integrated into the features offered by the
Viadeo platform. The Group's network has 39 million members.
2012
April:
Fourth round of fundraising: €24.2 million is raised, marking in particular the
acquisition of a stake by Bpifrance Participations alongside other international
shareholders, Ventech and IdInvest Partners having also taken part in the
fundraising. This fundraising is intended in particular to migrate the
technological platform, to speed up the development of mobile services and to
fund the development of the platform based in China: Tianji.com;
October:
Launch of a new set of mobile applications;
December: The Group's network reaches 48 million members.
2013
March:
Acquisition of Pealk, software application dedicated to the optimised use of
social network data (research, browsing through results, selection, etc.);
April:
Acquisition of Zaizher, a Chinese company developing mobile geo-location
technology which simplifies the establishment of professional relationships.
July:
Signature of a partnership with the French Chambers of Commerce and Industry
(CCI France) in order to speed up the digitisation of French companies. Digital
advisers within the CCI may present the Viadeo offer;
42
October:
Signature of a partnership with Pôle Emploi (the French employment agency) to
ensure greater transparency of the labour market and to foster access to job
offers and applications;
Signature of a partnership with Orange to enable 20 million Orange subscribers
to reconcile their account with their Viadeo account, thereby enjoying a better
mobile Viadeo experience;
December: The Group's network has 57 million members, including more than 8 million
members in France and 20 million in China. Mobile uses grow fast: 43% of the
traffic identified on the Viadeo platform is generated via a mobile tool
(smartphone, tablet or mobile web).
2014
January:
Issue of a €5 million convertible bond subscribed by certain Company
shareholders, namely the two founders Messrs Thierry Lunati and Dan Serfaty),
Ventech, Idinvest Partners, Bpifrance Participations, Angyal, TMM Consulting,
Global Internet Ventures LLC and Financière WM;
February:
Issue of a €0.5 million convertible bond in favour of an investor who is a
natural person;
May:
The Group has more than 60 million members;
Issue of a €5 million convertible bond, subscribed by a new investor, A
CAPITAL.
5.2
INVESTMENTS
The investments made over the last two years are as follows (see also section 10.2.2 of this document
de base):
Investments (consolidated)
(IFRS, euros 000)
Intangible assets
2013
12 months
2012
12 months
5,126
2,882
Tangible assets
875
1,257
Other non current financial assets
337
153
6,338
4,292
TOTAL
The main investment item concerns intangible assets, mainly comprised of capitalised development
costs. These costs concern the creation of new features and the technical development of the Viadeo
and Tianji platforms. These technical developments are aimed at having the technological capacity to
deal with the website's significant expansion, due to increased traffic and usages:
In 2012, the €2,882K was broken down into €2,596K capitalised with respect to ongoing
developments on the web platform and mobile and tablet applications for the Viadeo segment,
€256K in platform costs and €30K in software costs.
43
In 2013, out of a total amount of €5,126K, €5,105K concerned capitalised development
expenses, including €3,132K for assets in progress but not yet in service (thereby recorded
under assets in progress), whereas €21K concerned software purchases. The capitalised amounts
used for Tianji platform developments came to €1,314K. Out of the total amount concerning the
Viadeo segment, €901K concerned the new platform.
Investments in property, plant and equipment are mainly connected to the purchase of servers
(purchase representing €1,177K in 2012 and €514K in 2013) enabling the Group to store and process
data.
Other non-current financial assets concern mainly security deposits, namely €138K in 2012, connected
mainly to the change in the security deposit paid to GE Factobail, and €329K in 2013, of which €119K
is due to the new lease for the building located at 65 rue de la Victoire.
5.2.1
Main investments under way
Since the start of the current fiscal year, the investments under way are of the same type and of a
similar order of magnitude as those for the period presented. These investments are self-financed.
5.2.2
Main investments planned
The Group has not currently made any firm commitments with respect to carrying out significant
investments, although it intends to continue its efforts to expand its business in China, Russia and
Africa and envisages the duplication of its hosting within the next 24-months for approximately €1
million.
44
6
OVERVIEW OF ACTIVITIES
6.1 OVERALL PRESENTATION
Created in France in 2005 by Dan Serfaty and Thierry Lunati, Viadeo2 is a global player in
professional social networks (PSNs). Viadeo allows professional users, by signing up to the website
www.viadeo.com free of charge, to create a profile and develop a professional network. Although
Viadeo has members across the world, the Group focuses its efforts in a number of key geographical
regions, such as France and China, where it leads the market in terms of the number of registered
members (see below). It has adopted a differentiated strategy consisting of taking local characteristics
into account (a so-called "multi-local" strategy).
A presence on a PSN addresses multiple needs:
-
managing your career (promoting your visibility on the web to other members of the network
and recruiters, and facilitating contact for employment applications or replies to job postings);
identifying new business opportunities (identifying companies and finding out who their
decision-makers are);
maintaining a link with contacts to allow them to track their professional activity and have an
accessible, up-to-date online address book.
PSNs also draw on a concept common to generalist social networks: the "social graph". This enables
links to be forged between members and allows those links to be used to access other contacts through
recommendations, thus multiplying the possible interactions.
From the point of view of businesses, PSNs offer various information and communication
possibilities, as they contain large quantities of data on professionals that are more precise and, most
importantly, updated more regularly than the information on most professional databases. Although
they can be used for various means, their main use is currently focused on recruitment services.
Viadeo allows client companies to rapidly identify professionals (either in or seeking employment)
who meet their recruitment criteria and/or circulate job postings in order to contact them. Moreover,
the accessible data is "richer" than the data shown on job boards (contacts network, detailed career
history, skills, activity on the network, etc.). PSNs are also a shop window for these businesses, which
can also use Viadeo to communicate about their products or company.
As of the end of March 2014, the Viadeo Group has more than 59 million members worldwide,
including almost 9 million in France and 20 million in China, with the remaining members being
spread worldwide. The Group is experiencing solid growth, with between 400K and 600K new
members per month (figures measured in 2013).
2Launched
under the name of VIADUC, the website was renamed Viadeo in August 2007.
45
Evolution of the number of registered members worldwide
70 000 000
60 000 000
50 000 000
40 000 000
30 000 000
20 000 000
10 000 000
2009-01
2009-03
2009-05
2009-07
2009-09
2009-11
2010-01
2010-03
2010-05
2010-07
2010-09
2010-11
2011-01
2011-03
2011-05
2011-07
2011-09
2011-11
2012-01
2012-03
2012-05
2012-07
2012-09
2012-11
2013-01
2013-03
2013-05
2013-07
2013-09
2013-11
2014-01
2014-03
0
Source: Viadeo
The Group has adopted a multi-local strategy (see paragraph 6.3.2 below), focusing its development in
France, China, Russia and the countries of the CIS (Commonwealth of Independent States), as well as
in North and West Africa (mainly Morocco, Tunisia, Algeria and Senegal). In these regions, the Group
is the leader3 in terms of number of members (data at end of March 2014):
-
No.1 in China (more than 20 million members);
No.1 in France (almost 9 million members);
No.1 in French-speaking Africa (more than 2.5 million members);
Key player in Russia and the CIS (almost 1 million members).
Internationally, the Group has achieved growth by combining investments with targeted acquisitions,
allowing it to rapidly increase its presence in emerging countries offering significant growth prospects.
As it has grown, the Group has acquired members in various geographical regions.
The Group operates through two brands: Tianji in China and Viadeo in the rest of the world.
The consolidated revenue from operating activities of the Viadeo Group amounted to €30.9 million in
2013, an increase of 11.5% compared with the previous year. The Group's revenue mainly comes from
three separate sources:
-
online member subscriptions (51%);
sale to companies of recruitment and training services(29%);
marketing and advertising services (16%).
The revenue from the Viadeo platform is mainly comprised of that generated in France, Russia and
Africa. At 31 December 2013, this represented 97% of the Group's consolidated revenue from
operating activities (of which 95% came from France). The remainder, i.e. 3% of revenue from
operating activities, is generated through the Tianji platform (China). At the present time, the Group
has not launched any monetisation activities amongst its 27 million members in the rest of the world.
3
Company estimates based on the number of signed up members in the Group compared to the number of signed
up members published by the Group’s two main listed competitors on their respective websites for the main
markets in which they operate. See Section 6.2.3.2 of this document de base.
46
In the future, the Group intends to pursue its growth primarily in France and China, but also in Russia
and Africa. In each region in which Viadeo is present, the recruitment and marketing solutions offer
significant growth potential. The growth of recruitment solutions in particular is driven by a market
shift consisting of three aspects:
-
an increase in the share accounted for by the web in candidates' "Sourcing4" methods;
within the online recruitment market, a shift in recruiters' usage patterns from job boards to
PSNs;
in a broader sense, the acceleration of the disintermediation of the recruitment market, of
which the Group should reap the full benefit in the next few years.
The Group, as the leader in China in terms of number of members, wants to accelerate its growth and
rapidly conquer a large membership base in order to reach critical mass and enhance the monetisation
of its audience. Its development in Russia and Africa should also continue, with the possibility of
carrying out external growth transactions with a view to obtaining local structures and imposing the
Group as a local operator in each country.
In order to manage the expansion in the membership base and the growing number of interactions
between contacts, and to take full advantage of the growth of the Internet on mobile phones and
tablets, the Group made some major changes to its technology platform in 2013. The new platform
uses advanced technology, processes information more quickly and in greater quantities and has been
designed to optimise mobile uses.
As of 31 December 2013, the Group employs 447 people in five cities (Beijing, Casablanca, Moscow,
Paris and San Francisco) and manages eight different languages.
6.2 THE PROFESSIONAL SOCIAL NETWORK MARKET
The Internet has transformed the way in which information is created, shared and circulated. Thanks to
advances in large-scale data processing and IT infrastructures, web-based PSNs like Viadeo have
become means of real-time communication and, accordingly, media in their own right. These
platforms allow web users to share information about themselves, their knowledge and their
environment and to interact with their personal and professional contacts. These changes are referred
to as the "socialisation of the web"; they are precipitated by the degree of connectivity between
individuals on a global scale and the speed and ease with which information can circulate between
them.
6.2.1
A market driven by technological and social dynamics
Viadeo is closely tied to the development of the Internet and mobile technology, but it also depends on
the changing habits of online consumption and the use of social networks. More precisely, the activity
of the Viadeo Group is based on greater awareness among professionals of taking control of and
managing their career path, and on the other hand a desire of recruiters to develop their recruitment
practices towards more "social" methods, in order to identify better-quality candidates (in employment
or with rare, in-demand profiles). The Group's market is thus driven by a dual dynamic that is both
technological, in its relation to the growth of the Internet, and social, with the rise in the use of PSNs.
4Process
aimed at identifying candidates matching the profiles sought by a company.
47
6.2.1.1 Welcome to the "hyperconnected" world
According to the "We Are Social" study in January 20145, the global Internet penetration rate was
35%, representing around 2.5 billion web users.
6.2.1.1.1
In France
With a penetration rate of 83%, France has one of the highest rates in the world, behind the United
Kingdom (87%), Canada (86%), Germany (84%) and South Korea (84%)6. Continuing a dynamic
initiated in the early 2000s, the number of French households with Internet access has continued to
grow steadily.
According to a Eurostat study, 95% and 75% of households (with and without children respectively)
had Internet access in 2013, compared with 72% and 46% in 2007.
Evolution of Internet access
of French households (as a %)
100
50
0
2007
2008
2009
2010
2011
2012
2013
Households without dependent children
Households with dependent children
Source: Eurostat
The digital divide is narrowing between social categories: almost all executives have used the internet
since 2007 and four out of five labourers used it in 2012, compared with one out of two five years
earlier, although some differences in use according to age remain7.
This growth in Internet use has been driven by the rise in the equipment ownership rate, which has
itself been boosted by lower personal computer prices, the liberalisation of the telecommunications
sector and the growth of the web access market and high-speed technologies.
The study by Médiamétrie entitled "Année Internet 2013" ("2013 Internet Year") states that "more
than ever, the Internet is a key part of the life of French people", given that "the arrival of online
devices could open the way to new uses"8.
According to this study on French usage habits, social networks represent a huge proportion of
Internet use. In 2013, eight out of ten web users were registered on at least one social network. Social
and community websites have become indispensable and are now places where web users carry out
multiple activities (sharing, publishing, recommendations, etc.).
5We
Are Social Singapore, Global Digital Statistics, 2014 Edition: http://fr.slideshare.net/wearesocialsg
We Are Social, January 2014
7Source: INSEE
8http://www.mediametrie.fr/internet/communiques/l-annee-internet-2013-l-internaute-ultra-connecte-exposeengage.php?id=1017#.UzwE9lF_uuE
6Source:
48
6.2.1.1.2
In China
The penetration of the Internet among the Chinese population has grown significantly since the early
2000s. Between 2002 and 2013, the proportion of the Chinese population with Internet access soared
from 5% to 46%. Over the same period, the number of users has multiplied tenfold, representing
average annual growth of 23.8%.
This trend has accelerated in the last five years: in 2008, 296 million Chinese people had Internet
access; at the end of 2013, this figure stood at around 618 million.
Evolution of the Chinese population with Internet access
75%
800
65%
618
564
55%
513
457
45%
384
298
35%
25%
15%
5%
59
80
5%
6%
34%
700
600
46%
42%
38%
500
400
29%
300
210 22%
137 16%
94 111
10%
7% 8%
200
100
0
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Number of Internet users (m)
Penetration rate
Sources: iResearch, Macquarie Research, April 2013
6.2.1.1.3
In Russia
In Russia, the number of web users was estimated 73.8 million in 2013, compared with 62 million in
2011, an increase of more than 10 million users in two years. According to a study carried out by
eMarketer, this figure is set to rise to 86 million users by 2016. As a percentage of the population, the
number of Internet users increased from 45% in 2011 to 54% in 2013. According to eMarketer's data,
this growth should continue at a rate of 4.5% to 7% per year in the coming years, reaching a
penetration rate of 64% in 2016. Today, Russia is Europe's biggest market in terms of numbers of
Internet users9.
Evolution of the Russian population with Internet access
120
105%
85%
65%
62
45%
45%
67,9
49%
78,8
73,8
58%
54%
82,7
61%
86,3
64%
80
60
40
25%
20
5%
0
2011
2012
2013
2014
Number of Internet users (m)
Source: eMarketer, February 2012
9
100
Source: comScore, December 2012
49
2015
2016
Penetration rate
6.2.1.1.4
In French-speaking Africa
In Morocco, the most representative country of French-speaking Africa, the Internet penetration rate
increased from 21% in 2007 to 49% in 2011, i.e. 15 million users. In 2009, Morocco launched a
programme to establish the country at the forefront of information and communication technologies,
which was entitled "Maroc Numeric 2013" and given a budget of €465 million.
Evolution of the number of web users and
mobile subscribers (in thousands)
45 000
40 000
35 000
30 000
25 000
20 000
15 000
10 000
5 000
0
Web users
Mobile subscribers
2009
2010
2011
2012
2013
Source: Business Monitor International
6.2.1.2 Mobile: a new surge in Internet uses
The vast growth in smartphones has given a further boost to Internet uses. In January 2014, the
penetration rate of mobile phones in China, France and Russia was broken down as follows (for an
average global penetration rate of 93%):
Penetration of mobile phones
Country
Penetration rate
(%)
China
89
France
109
Russia
184
Source: We Are Social
50
According to the "We Are Social" study, the penetration rates of smartphones (i.e. mobile phones with
functionality enabling Internet access, amongst other features) are particularly high in the countries in
which the Group operates:
Penetration and use of smartphones
Penetration rate
(%)
Searches (1)
Purchases
(2)
China
47
96
69
France
42
88
26
Russia
36
93
39
Country
(1)
Subscribers using their smartphones to search for information
(2) Subscribers making purchases using their smartphones
Sources : We Are Social and https://itunews.itu.int/fr/3855-Le-nombre-
dabonnements-aumobile-frole-les-septmilliardsbrUn-telephone-pour-chacun-oupresque.note.aspx
l
According to IDC/GFK10, at the end of 2013 France had nearly 27 million mobile web users, i.e.
individuals having a smartphone capable of accessing the Internet. This represents almost one in every
two French people, compared with just one in three in 2011. In 2013, the same study indicated that
more smartphones than standard mobile phones were sold in France. According to this study, in 2013,
23.6 million mobiles were sold to French people, including 15.8 million smartphones. In 2014, even
with lower growth of around 10 to 11%, more than 17.5 million smartphones will be purchased by
French people, almost triple the sales of standard phones.
The "We Are Social" study also shows that 41% of mobile users in France and 51% in China use
social networks on their phones. The growth in smartphones is modifying the behaviour of subscribers
and web users, to the benefit of all social networks.
The Group therefore believes that the mobile market is a key growth driver, given the development of
4G (see also paragraph 6.5.3) and the simplification of operating systems around three major
systems(iOS, Android and Windows Phone), which foster the development of applications available
on the mobile ecosystem and create a force of attraction for new users.
Finally, the growth of tablets is further accentuating this phenomenon. According to the IDC/GFK
study mentioned above, in 2014, 7.5 million tablets will be sold in France, far ahead of laptop
computers (3.7 million units) and desktop computers (700K units).
10http://www.zdnet.fr/actualites/chiffres-cles-les-ventes-de-mobiles-et-de-smartphones-39789928.htm
51
6.2.1.3 The penetration of social networks, including professional ones
Again according to the "We Are Social" study, in January 2014 the penetration rate of social networks
stood at 26% globally but, as with Internet penetration, the rates in countries where the Viadeo Group
operates were higher:
Penetration of social networks
Penetration rate
(%)
Time spent
(hours)
China
46
1.5
France
42
1.5
Russia
33
2.2
Country
Source: We Are Social - Jan 2014
The use of social networks is thus well-established in the Group's key regions. Nonetheless, the
penetration rates above show that significant growth prospects still exist.
The growth in the use of PSNs is profoundly changing communication methods in the professional
sector and the Group believes that PSNs will eventually become a sort of "ERP"11 for the professional
with multiple uses (visibility, management of contacts, personal development etc.), making them even
more essential than they are today.
Young graduates have already been largely won over by PSNs and demonstrate the rise in the
professional use of networks. According to a study carried out by the EDHEC in 201312, in France:
-
79% of students and graduates had at least one account on LinkedIn or Viadeo. This number
stood at only 53% two years earlier.
84% of business school students, 63% of engineering students and 48% of university students
were registered on a PSN.
53% of students had already consulted job or internship offers on a PSN and 19% had already
applied for jobs via a PSN.
Viadeo being the most used. Professional social network use stood at 77% for executives aged under
3013. In 2011, in France, although the proportion of executives using PSNs to look for employment
was high (53%) and likely related to the economic situation, PSNs were mainly a means of expanding
their professional networks (56%) and sharing information14.
Finally, more and more recruiters use PSNs or believe that they will play an increasingly important
role in recruitment processes. According to the APEC, in France in 2012, 25% of company recruiters
used a PSN the last time they recruited an executive, which is twice as many as in 2008, and 24% of
recruitment firms used a PSN15.
11
ERP: Enterprise Resource Planning.
Source: EDHEC NewGen Talent Centre, June 2013
13
Source: APEC, November 2012
14
Source: Adecco, September 2012
15
Source: APEC, June 2013
12
52
The use of PSNs has therefore grown rapidly in the business world and in the recruitment market and
the Group believes that, eventually, professional social networks will cover all active people and all
recruiters.
6.2.2
PSNs have a huge potential market
The business model of PSNs is aimed at both a market of professional users and a market of
businesses. The Viadeo Group's revenue currently comes from:
-
subscriptions taken out individually by members of the network, a source of income that arose
very early in the Group's history and allowed it to fund Viadeo's growth; and
the selling of recruitment and marketing services to client businesses (recruitment agencies,
key account customers and medium-sized businesses), a source of income that now represents
the Group's most attractive growth opportunity.
6.2.2.1 A market driven by the evolution of the active population
Although they are aimed solely at active people, PSNs can cover a significant number of members: the
global active population stood at more than 3.2 billion in late 2013, according to data from the World
Bank16.
In mainland France, the active population was estimated at 28.6 million people aged 15 or over in
2013, according to an employment survey carried out by the Insee. This population includes 25.8
million active people and 2.8 million unemployed people. Viadeo believes that its core target market is
more than 20 million people.
In China, the World Bank study mentioned above estimated the active population at more than
787 million in late 2012. Tianji's core target is smaller, however, and Viadeo estimates it around 300
million people.
Evolution of China's active population
Source: World Bank
In Russia, the active population stood at around 77 million people in late 2013, according to data from
the World Bank.
16http://donnees.banquemondiale.org/indicateur/SL.TLF.TOTL.IN/countries/1W?display=graph
53
PSNs initially grew by winning over members, to whom they offered paid-for services via a model
selling online subscriptions providing access to a range of "Premium" services.
Subsequently, their offer expanded to include the sale of recruitment tools, advertising space and
marketing campaigns, addressing the emergence of new requirements on the recruitment and
advertising market.
6.2.2.2 The subscription market
The growth in the sale of online subscriptions has been partly driven by the growth of the larger ecommerce market (the sale of online services is a segment within this market).
According to eMarketer, the global e-commerce market should grow by 20% to around $1,500 billion
in late 2014 and more than $2,350 billion in 201717.
The growth of e-commerce has accelerated particularly on the Chinese Internet, where online
payments are now common. According to eMarketer18, the number of Chinese web users who make
online purchases, estimated at 270 million in 2013, should rise to 423 million in 201619. The turnover
of China's e-commerce industry in 2013 exceeded 10K billion Yuan (€1,175 billion), of which $1,850
billion (€217 billion) came from online retail sales, which allowed China to move ahead of the United
States to become the world's largest online retail market20. In terms of M-commerce, 79% of Chinese
web users surf the Internet using their mobile phones. According to Euromonitor, China's mobile
commerce market should triple by 2018 to become the world's second-largest after the United States.
At the same time, credit card ownership has grown significantly, reaching 43.5% of the population in
201221.
6.2.2.3 The recruitment market
The rapid growth in the membership base of PSNs comprised solely of professionals (in or seeking
employment) quickly piqued the interest of recruitment firms and company human resource managers.
PSNs have gradually developed an offer dedicated to businesses aimed at offering tools and services
for identifying and searching for candidate profiles, as well as job posting spaces. In just a few years,
PSNs have thus become essential recruitment tools.
The global recruitment market is worth around $90 billion in 201422. The Europe and Asia regions are
worth $33 billion and $5 billion respectively, with annual projected growth of 3% in Europe and 11%
in Asia between 2014 and 2017. According to estimates given by Morgan Stanley Research, the
potential market available to PSNs represents around one third of the recruitment market, i.e.
approximately $7.6 billion for the Europe and Asia regions.
17
“Global B2C Ecommerce Sales to Hit $1.5 Trillion This Year Driven by Growth in Emerging Markets”, eMarketer,
February 2014.
“China's Ecommerce Market Joins the Majors”, eMarketer, November 2012 .
19
Chinese people aged 14 and above who make at least one online purchase per year.
18
20
http://french.peopledaily.com.cn/Economie/8561244.html
http://blog.iziflux.com/wp-content/uploads/2014/01/slide-1-638.jpg
22
Source: IDC 2013
21
54
Estimation of the global recruitment market potentially available to PSNs
Worldwide Talent Acquisitions
and Staffing Services ($B)
100
80
Asia / Pacific
60
97.3
93.4
101.5
7
84.7
4
86.6
5
89.6
5
36
33
35
33
34
33
47
49
51
53
55
58
2012
2013
2014
2015
2016
2017
7
6
Worldwide
job search market
Worldwide talent
acquisitions and
staffing services
EMEA
$90bn
Americas 40
20
PSN addressable
market
0
Am ericas
2014-17 CAGR: 4%
EMEA
2014-17 CAGR: 3%
$30bn
Asia
2014-17 CAGR: 11%
Sources: IDC Talent acquisitions & Staffing services 2013-2017, Morgan Stanley/LinkedIn estimates
In France:
According to the Group's estimates, the recruitment market in France is worth between €650 million
and €800 million. This market is broken down into two distinct segments: the Sourcing market, valued
by the Group at approximately €150 million to €200 million and comprising operators offering job
posting and database profile searching services (France's major operators are Monster,
FigaroClassifieds, RegionsJobs, Indeed and a number of smaller operators), and the intermediation
market, comprising of candidate searching and selection service providers (recruitment firms, preselection intermediaries, candidate management tools, etc.), valued at between €500 million and €600
million (see paragraph 6.5.1 below on the disintermediation of the recruitment market).
Estimation of the recruitment market potentially available to PSNs in France
Perm-recruitment
€500-600m
Effective Online
sourcing market
€150-200m
Sources: UBS, company estimates
55
In China:
China's recruitment market is still nascent, but growing strongly. According to a study by Macquarie
Research, it was estimated at $420 million in 2012, with projected growth of 24.5% per year between
2012 and 2015.
Estimation of the recruitment market potentially available to PSNs in China
Job search market
A multi b illion market
Perm-recruitment
$ 3bn
2012
2008
Online sourcing
$ 420m
$ 150 m
Sources: UBS, company estimates
Between 2009 and 2015, the number of companies using recruitment solutions is set to grow by an
average of 22.7% per year. The number of Internet job seekers should increase by an average of 10.6%
between 2008 and 2013. Moreover, according to the same source, 46% of Chinese companies already
plan to use PSNs to recruit in the future. Compared to the US market, where the usage rate of PSNs in
recruitment is 92%, the growth potential of this market could be significant for the next few years.
Online job seekers in China
Chinese online recruitment market
56
Chinese companies recruiting online*
Proportion of companies using PSNs
*RMB/USD exchange rate on 1st January each year
Sources: iResearch, Macquarie Research; Aceona, Jobvite, Macquarie Research, April 2013
6.2.2.4 The advertising and online marketing solutions market
Finally, the Viadeo Group also targets the online advertising market. For reference, in 2012 the
Internet-based advertising market was worth $100 billion worldwide23 and $3.5 billion in France24.
According to a study carried out by PwC, this market is expected to grow by 13.7% over the 20112017 period, reaching €185 billion in 2017.
Alongside this, the growth of the mobile advertising market is expected to accelerate. In 2012, this
market was worth $8.8 billion worldwide, $190 million in France and $1.2 billion in China. This
figure should increase sharply over the next few years to $94.9 billion in 2018, placing projected
annual growth at 48.8% during the 2012-2018 period.
Growth of the worldwide online and mobile advertising market
Worldwide online advertising market
Growth of the mobile advertising market
7
Sources: eMarketer, March 2014 – Mobile & Tablets – including displays and excluding SMS/MMS and P2P, PwC Global Entertainment &
Media Outlook 2013-2017
Source: eMarketer
Source: SRI/PwC
23
24
57
In France, the online advertising market has expanded steadily since 2008, with an average growth of
7.3% per year. The mobile advertising market recorded a sharper increase between 2009 and 2013,
with average annual growth of 51.9%. At the end of 2013, this market was worth €229 million.
Growth of the French online and mobile advertising market
Online advertising market
Mobile advertising market
800
3100
700
2,840
2900
2,700
2700
2500
400
2,305
2300
2100
600
500
2,561
300
2,110
2,000
229
200
1900
100
1700
146
122
43
52
2009
2010
0
1500
2008
2009
2010
2011
2012
2013
2011
2012
2013
Mobile advertising market (€m)
Online advertising market (€m)
Sources: SRI-CapGemini Consulting Observatory (9th edition), SRI-PwC Consulting Observatory (11th edition) (Display and Search
advertising on mobile devices)
In China, the online advertising market expanded significantly between 2005 and 2012, recording
average annual growth of around 54.7%. The mobile advertising market has also flourished, with
projected growth of 84.2% per year over the 2008-2014 period.
Growth of the Chinese online and mobile advertising market
Online advertising market
Mobile advertising market
8.0
12
10.6
7.0
10
6.0
4.0
6
5
4
2
5.0
7.4
8
2.7
3.3
1.0
1
1.2
0.1
0.1
0.2
2008
2009
2010
0.5
0.0
0
2005
2.2
2.0
1.7
0.5
3.2
3.0
2006
2007
2008
2009
2010
2011E
2012E
Online advertising market ($bn)
Sources: iResearch, Macquarie Research, January 2012
58
2011E
2012E
Mobile advertising market ($'bn)
2013E
2014E
6.2.3
Viadeo's competitive environment
6.2.3.1 Recruitment operators
The recruitment market is comprised of a number of operators conducting different activities,
positioned along the complex recruitment value chain:
-
online job boards (Monster.fr and Cadremploi.fr in France; Zhaopin.com and ChinaHR.com in
China; HH.ru in Russia; Rekrute.fr in Morocco, etc.);
recruitment firms (from head hunters who only recruit top executives to firms working mainly
through adverts);
Recruitment Process Outsourcing (RPO) firms;
publishers of recruitment-related software (application and selection management solutions);
candidate-focused services (online CVs, tests, consulting, etc.);
temporary employment agencies and umbrella companies.
The job search market: a multitude of complementary operators
Source: Viadeo
The Viadeo Group's offer in the recruitment market therefore lies at the intersection of a multitude of
operators and is aimed at providing value to customers in these three market segments.
Although the Group is in direct competition with these operators in the recruitment sector, it is set
apart by its offer - which allows fast, direct, effective searching at a competitive cost and, above all,
access to rare, highly-detailed profiles - and by access to a larger target population: namely passive job
seekers.
The Group has noted that, in the past, some online job boards tried unsuccessfully to build a social
network around their original offer by providing social features. These failures can be explained by the
59
fact that job boards mainly attract an audience of active job seekers who only use the service on a oneoff, and transactional basis and for whom interactions with other site users offer less value.
6.2.3.2 Other professional networks
On the PSN market specifically, there are fewer operators. On a global and European scale, only two
social networks have activity levels comparable to that of the Viadeo Group. They are the American
company LinkedIn and German Xing.
LinkedIn
Xing

An American company founded in 2003 and listed on the New York stock
exchange in 2011, LinkedIn is the global leader in the industry. At 31
December 2013, LinkedIn posted consolidated turnover of $1,528 million. At
the same date, the company employed some 5K people and boasted 277
million members worldwide, of whom 85 million are located in the Europe,
Middle-East and Africa region (EMEA). In 2013, the EMEA region generated
turnover of $358 million, 23% of the total. LinkedIn's market capitalisation
amounted to $21.1 billion at 21 April 201425.
Created in 2003 and listed on the Frankfurt stock exchange in 2006, Xing is the
leader in Germany. Its strategy is mainly local, targeting German-speaking
countries. At 31 December 2013, Xing posted consolidated turnover of €84.8
million. At the same date, Xing employed around 571 people and had 14
million members, 7 million of whom are located in the Germany, Austria and
Switzerland region. Xing's market capitalisation amounted to €533 million at
22 April 201426.
In France:
Viadeo's main competitor is LinkedIn, which sits in second place behind Viadeo in terms of
membership, with around 7 million members26.
25
26
Source: LinkedIn website, April 2014
Source: Xing website, April 2014
60

In China:
The PSN market is still relatively fragmented. Tianji's main competitors on the Chinese market are
local operators of three types:
- Dajie, a website aimed solely at young professionals;
- Recruitment websites with social features, such as Liepin;
- PSN websites, such as Wealink and Ushi.
However, in terms of membership, based on publicly available information, Tianji remains the leader
in China, with more than 20 million members.
LinkedIn also operates on the Chinese market with a base of around 4 million members27, a presence it
intends to strengthen. However, the Group believes that its local approach is a key factor for success
on the Chinese market, given its specific cultural characteristics.
Dajie
Liepin
Ushi
Wealink
Renhe
JingWei
Created in 2008, the Dajie site was originally dedicated to students. In May
2011, Dajie opted to extend its target audience to include executives. At the end
of 2012, the website had around 12 million members28. According to the
company's estimates, on the date this document was compiled it had more than
25 million members, the vast majority of whom are students, leaving some 3 to
4 million professionals. Dajie's turnover doubled between 2011 and 2012,
reaching 20 million Yuan in 2013 (Dajie estimate).
Created in 2006, Liepin is currently present in 11 Chinese cities and has a base
of around 11 million members29. In April 2014, the company raised $70 million
to fund its expansion in China and the optimisation of its technology platform30.
Created in 2010 as an invitation-only PSN, Ushi is aimed at senior executives.
In 2012, the website had almost 1 million members and in July 2013 reported
growth of 100K new visitors per month31.
Founded in 2004, Wealink was one of the first PSNs to be developed in China.
Wealink is aimed at senior executives.
Renhe was created in 2006. At the end of 2012, the website had 5 million
members32.
JingWei was launched in 2011 through a joint initiative between the Chinese
online recruitment website Zhaoping and Renren, China's largest social
network.
27
Source: LinkedIn website, April 2014
Sootoo.com (http://www.chinainternetwatch.com/1844/chinas-professional-social-networking-users-to-reach-100million/)
29
Source: Liepin
30http://technode.com/2014/04/16/recruiting-service-liepin-secures-70-million-series-c-funding/ (February 2014)
31http://www.mckinseyonmarketingandsales.com/interview/professional-networks-in-china-an-interview-with-dominicpenaloza-and-quentin-zhang-ushi-com (July 2013)
32Source: Sootoo.com (http://www.chinainternetwatch.com/1844/chinas-professional-social-networking-users-to-reach-100million/)
28Source:
61

In Russia:
There are a multitude of social networks specialised by profession. Viadeo's main competitors on local
generalist PSNs: Professionali.ru and "Moikrug" (My Circle). The Group does not consider the offer
and image of these websites likely to represent long-term competition.
Professionali.ru
Moikrug
Professionali.ru was created in 2008. The site has more than 4.5
million members33.
Created in 2005, the PSN Moikrug was purchased by Yandex in
2007.
Finally, in Africa, the Group has not identified any significant local players.
Consequently, today's PSN market is structured around three main operators: Viadeo, LinkedIn and
Xing. The Group believes that, although it cannot be ruled out, the probability of new players
appearing on this market is low, given the significant entry barrier represented by the critical mass of
the member network. A minimum size is necessary in order to render the services proposed by the
network useful. This critical mass is also a prerequisite to allow the network to fuel its growth through
the actions of its members and to activate drivers of monetisation.
Moreover, the examples mentioned above show that in the PSN market, different players with
different models can coexist, given that their professional practices and the needs of their users,
whether members or recruiters, are different. The growth of Xing proves that the Group's multi-local
strategy is correct. Xing has built its success by concentrating on German-speaking markets and
addressing the specific needs of these populations.
6.3 VIADEO: AN ESSENTIAL PROFESSIONAL SOCIAL NETWORK
Globalisation, macro-economic conditions, changing requirements on the employment market and
technological innovations are forcing professionals, businesses and professional organisations to
modify their working methods. Professionals constantly have to be faster and more efficient, and make
better-informed decisions. In order to succeed, they need tools and applications that allow them to
make the most of their professional network and improve access to important information. Viadeo has
taken this approach and in less than ten years has established itself as an essential operator on
professional social networks, chiefly in France and China, with more than 60 million members.
This achievement is the result of a number of factors, some of which are connected with the Group's
strategy, whilst others arose from the increased popularity of the Internet and its influence on social
habits and behaviour, particularly through the growth of social networks in daily life.
33Source:
Awara Group, February 2014
62
6.3.1
The Viadeo Group's offer
6.3.1.1 A network growing naturally
In response to the growth of personal social networks such as Facebook, the Viadeo Group addresses
the need of active people to be able to separate their professional and personal lives. Although this
separation originally occurred for obvious reasons of privacy protection, it has been reinforced by a
different positioning addressing the need of members to take a different approach to managing their
image, their conversational tone and the nature and depth of their circle of contacts.
Economic uncertainty, rapid shifts in entire sectors of the economy and the regular emergence of new
professions all contribute to making professionals more aware of the importance of their
employability. As the concept of a "job for life" disappears, professionals are obliged to make
themselves more employable. In this context, active people act more and more like individual
entrepreneurs in charge of their own careers. They are constantly attentive and more open to new
opportunities. With this in mind, Viadeo and Tianji, thanks to their reputation and membership
numbers, represent excellent opportunities for professionals to:
-
manage their professional visibility on the Internet;
arouse the interest of potential employers or head hunters (passive job searching);
manage their contacts by maintaining a link even after changing company or job;
have access to information about other professionals (career history, skills, training, activity
sector, etc.);
access job and training opportunities;
search for new commercial opportunities;
connect with colleagues;
interact with their peers, etc.
...and, above all, be able to develop their network and connect with people they do not know but who
can be accessed through their existing contacts, who will allow and foster connections, thus forming
the basis on which the network is built.
Originally reserved for executives, these needs are gradually being expressed by other professional
categories.
The growth of Viadeo's membership base follows a virtuous circle. By completing and updating their
profile, existing members expand the website's database, which in turn attracts new members to the
network. Furthermore, each member connects with professional contacts, thus helping to recruit
members not yet present on the network. This method of acquiring new members allows the network
to grow "virally" whilst requiring very low acquisition costs (marketing costs). This is the "network
effect".
63
The Network Effect
•More members
•More data collected
•More attractive
network
•More interactions
between members
The database is also updated naturally by the members themselves, who benefit from having an up-todate profile. The database, which is a key asset of the Group, thus expands and grows organically.
The Viadeo network's membership base is also an entry barrier to the PSN market. It is only once
critical mass has been reached that the membership base can be monetised and become selfreinforcing. This critical mass is not defined as an absolute value, but depends on the size and maturity
of the market. The Viadeo Group believes it has reached this critical mass in France. Reaching critical
mass allows the network to enter into a virtuous circle that benefits both Viadeo and its members.
6.3.1.2 Growth based on a "Freemium" model
The PSN's basic services are organised around the following major features:
The profile
The profile is the Viadeo member's identity card. It contains the member's essential information
(name, photo, location), career path and education. The profile has regularly evolved, allowing
members to enhance its content with skills, the option of displaying their contacts, their favourite
books, etc.
It allows members to:
64
-
be identified online via indexing on the major search engines;
showcase themselves by presenting a polished professional image (photo, descriptive text,
experience, books, etc.) in order to attract opportunities;
optimise their visibility and link to other profiles (members appear on all pages relating to
their companies and schools, in search results, etc.).
Today, a properly presented Viadeo profile (format, content, choice of text for referencing) represents
a professional advantage that sets users apart and helps them access career and/or business
opportunities.
Contact management and "Do you know them?" feature
In addition to presenting a profile, Viadeo is primarily a network of interacting professionals. The
creation (or consolidation of existing relationships) and expansion of the network is thus one of the
most decisive features of Viadeo.
Viadeo has therefore developed various features to enhance its members' networks:
- importation of contacts existing in the most popular e-mail systems (Gmail, Yahoo, Hotmail,
etc.);
- ability to invite acquaintances to join Viadeo (and therefore the member's network).
One of the most innovative features consists of recommending contacts known by members, to allow
them to easily find people they already know or who are likely to be of interest. This feature uses
recommendation algorithms that exploit Viadeo's data in order to suggest appropriate contacts.
65
Dashboard
The Dashboard is the home page of all registered members. This highly personalised page is where
members can view the activity taking place on their network.
Through a modern, responsive interface, members can access all Viadeo information relating to their
network that may interest them:
-
interesting articles targeted at them and/or shared by their network;
information modified on their contacts' profiles (jobs, skills, photos, books, etc.);
new contacts added by their contacts;
confirmation of a skill by one of their contacts;
job opportunities that may interest them;
etc.
The larger the member's network, the richer and more relevant the information on it will be. The
Dashboard is also an interactive space where members can, like on other social networks, like and
comment on the updates that appear.
66
Messages
Messages is a simple and effective system for members to communicate with each other. It is a key
feature, as it allows members to interact via the Viadeo platform privately or in groups.
Emails
Email is an important communication channel that allows Viadeo to remain in contact with members
even when they have no immediate reason to visit the site.
Viadeo sends various highly personalised emails in order to provide members with information about
events occurring on their network: received and accepted contact requests, comments on a publication,
members who visited their profile, news summaries from their network, job opportunities that may
interest them, etc.
Given the volume and diversity of the messages and actions expected from the member, emails are an
entirely separate Viadeo product and thus not merely a means of notifying members.
Face to Face
This product allows members to choose the jobs they would like to have and recruiters to indicate the
profiles they are looking for. Viadeo then puts the two parties in touch with each other according to
the information they enter. Launched in the first quarter of 2013, this service had an uptake rate of
more than 1,000 members per day at the end of March 2014.
67
Face to Face
In addition to these free features, the Group offers a so-called "Freemium" model and uses viral social
networking effect to grow organically.
Registration on the Viadeo and Tianji networks is free. It facilitates recruitment and provides new
members with basic features that allow them to build a profile, expand their network by adding people
they know to their circle of contacts, respond to contact requests, join discussion groups and follow
companies. However, in France, access to extra functions requires a "premium" subscription. The
services reserved for Viadeo's premium subscribers, compared to those offered to non-premium
members, are the following:
Standard
Boostez votre carrière :
Découvrez qui a visité votre profil.
Passez en tête de liste dans les résultats de recherche.
Postulez aux offres d'emploi.
Développez votre réseau :
Envoyez des messages à vos contacts Viadeo.
Visitez tous les profils qui vous intéressent.
Contactez les membres de votre choix.
Ajoutez des contacts à votre réseau.
Gérez vos contacts avec votre carnet d'adresses.
Développez votre business :
Utilisez les filtres de recherche.
Publiez des événements.
Utilisez la recherche avancée.
Échangez avec votre réseau :
Invitez des membres à un groupe.
Accédez à la liste des événements dans votre secteur.
Participez à des groupes de discussion.
68
Premium
The subscription rates for Viadeo are as follows (rates recorded on the date on which the present
document was registered):
Subscription length
Monthly fee (€)
24 months
4.95
12 months
5.95
3 months
6.95
1 months
8.95
It should be noted that, for members, all features related to employment are free and it is not
compulsory to take out a premium subscription in order to search for jobs.
6.3.1.3 The development of recruitment solutions
Originally, the main aim of professional social networks was to develop professional contacts in order
to foster interaction and business opportunities. They very quickly revealed themselves to be valuable
tools, adopted firstly by head hunters and then by recruitment managers working within large
companies, as they provided access to a previously unavailable source of recruitment. PSNs are an
excellent way for members to enhance their visibility on the Internet. The professional information
published on the web allows recruiters, company owners and human resources managers to identify
people in employment (who are not necessarily actively looking for work), find out more about them
and contact them if their profiles are of interest. In terms of audience, Viadeo lies far ahead of job
boards.
The success of businesses in the global economy increasingly depends on their ability to attract
talented individuals.
Despite often high rates of unemployment, such as in France, where it reached 9.8% in the fourth
quarter of 201334, businesses struggle to recruit qualified people. This obvious paradox forces them to
invest in order to promote their attractiveness and their "employer brand". A presence on a
professional social network is a decisive advantage to reach the most sought-after candidates.
Moreover, an individual's professional success does not only depend on his or her knowledge and
expertise, but also/often on "soft skills" that are difficult to assess on a standard CV.
Relationship skills (the person's address book and ability to organise his or her professional network)
are also increasingly needed. These skills can be evaluated more easily on a professional social
network profile.
By identifying talented individuals in discussion groups, reaching candidates who are not looking for
work, viewing recommendations from colleagues and superiors... PSNs are rich stores of information
for recruiters. Viadeo offers to recruiters a number of advantages:
 Expanding their search scope
With the standard "CV Libraries" used by job boards, recruiters can only access people who are
looking for work or at least keeping an eye on the market. Thanks to Viadeo's "Profile Library", they
can expand their search scope to include people not actively seeking new employment.
34
Source: Insee, data for mainland France
69
 Contacting members
Viadeo and Tianji allow recruiters to contact members with specific identified profiles. If they are not
looking for work and not ready to leave their current employer, the social network nonetheless allows
regular contact to be maintained. This is a means of forging a relationship with such individuals with a
view to contacting them again for future opportunities. If the required profile cannot be found,
recruiters can enquire on the network if anyone is able to put them in touch with the right person.
 Detecting talented individuals in discussion groups
Discussion groups on specific, often technical topics, allow recruiters to identify the best profiles by
interacting with them.
 Having access to more reliable and more accurate information
By their very nature, profiles on professional social networks are public. This visibility encourages
transparency and dissuades candidates from being dishonest about their career. It is more difficult to
lie on social networks, as the information can be challenged by the person's contacts or colleagues. It
is also very easy to report misuse. The transparency of the information published on PSNs is a key
factor in the development of Tianji in China, which enhances confidence in this information through a
verification system (see paragraph 6.3.2.2). Similarly, a profile often contains more information than a
simple CV. For example, on a profile, users can indicate key skills (technical, linguistic, managerial
etc.) that can subsequently be confirmed by their contacts. Finally, for each experience, the person's
professional contacts (clients, service providers, colleagues, employers, etc.) can write a public
recommendation. This form of approval can only be of reassurance to recruiters.
 Having regularly updated information
Web users who place CVs on standard job search websites are not able to modify or update them
regularly because they do not have time or, more often, because they simply forget. This means that
recruiters often access obsolete data. This problem does not exist on Viadeo and Tianji as, given that
the profile also plays the role of a "business card", it is much more damaging for the member if he or
she does not update it.
6.3.2
A multi-local strategy
The development strategy of the Group aims to rank it first on markets selected according to their size
and strong growth potential. The Viadeo Group has therefore chosen to focus its development strategy
on three main geographic regions outside France with the ambition to become a leader in these
countries:
-
35
in China, the world's largest market in terms of Internet users35;
in Russia, the largest European market in terms of Internet users; and
in French-speaking Africa, a market which will be growing very fast starting from 202036.
Source: Conscore, August 2013.
Natixis' market research on the potential of French-speaking African countries.
36See
70
In addition to their growth potential, these markets have very strong national identities, local cultural
practices, and Internet environments (search engine, Webmails, web sites, etc.) which are very
different from those in Anglo-Saxon countries, in particular when it comes to business.
In this context, the Group believes that these geographic regions are not really receptive to either the
American model or American culture. A local approach to business is therefore key to understanding
the specific needs and issues so as to meet the members' expectations and penetrate the local
economy.
In order to roll out this strategy, the Group has local teams abroad, mainly located in China and
Russia, composed of respectively 145 and 19 people at the end of December 2013, and therefore has a
true understanding of local business practices. To achieve this goal, the Group hinged its development
on acquisitions and on partnerships with local firms. For example, growth in China took place with the
acquisition of the company Tianji in 2008 (described in paragraph 6.3.2.2 below), whereas the
development in Russia was achieved by a joint-venture with the Sanoma media group (partnership
described in paragraph 6.3.2.3 below).
71
6.3.2.1 A leading position in France
Viadeo is the leading Professional Social Network (PSN) with nearly 9 million members at the end of
March 2014 and a brand supported by a strong reputation. In France, Viadeo has a monthly average
of37:
-
6.4 million unique visitors38;
1.4 million new profile data collected;
23.7 million contact requests accepted (increase in network density).
Evolution of the number of members in France
10,000,000
9,000,000
8,000,000
7,000,000
6,000,000
5,000,000
4,000,000
3,000,000
2,000,000
1,000,000
2014-01
2013-10
2013-07
2013-04
2013-01
2012-10
2012-07
2012-04
2012-01
2011-10
2011-07
2011-04
2011-01
2010-10
2010-07
2010-04
2010-01
2009-10
2009-07
2009-04
2009-01
-
Source: Viadeo
In France, the relevance of Viadeo's valued offering ranks it well ahead of job board websites in terms
of audience.
Compared evolution of Viadeo audience vs. JOB
BOARDS
5 000
4 500
4 000
3 500
Viadeo
3 000
Indeed
2 500
Cadremploi
2 000
APEC
1 500
Monster
1 000
Keljob
500
0
Regionsjob
Source: Mediamétrie Net ratings, France; Unique visitors in Thousands
37
Source: Viadeo and Google Analytics
Google Analytics
38Source:
72
Viadeo's substantial base and network density put it at the very heart of France's local economy. The
Company established partnerships with various players in order to boost the job market and contribute
to its growth through digital media:

POLE EMPLOI (the French employment agency) and Viadeo have been working hand in
hand since October 2013 to reinforce the transparency of the job market and help job seekers
get easier access to all the digital resources available. This public-private project aims to post
and aggregate a selection of POLE EMPLOI's employment opportunities on Viadeo and vice
versa, to post Viadeo's offers on POLE EMPLOI. In a second stage, POLE EMPLOI will
enable the creation of a Viadeo profile from a CV posted on POLE EMPLOI.

APEC (the French agency for the employment of executives) and Viadeo have been partners
since 2009, providing a set of integrated services to the visitors of the www.apec.fr website
which enable them to use their Viadeo network while viewing job opportunities and therefore
optimise their application. Since 2013, the partnership has been extended to offer executives
and young graduates supported by APEC a three month access to Viadeo's Premium offer with
advanced functional features in order to enhance their mobility process.

CCI France and Viadeo have been supporting VSEs and SMEs39 since July 2013 all across
France by providing them with useful digital tools to grow and expand. Digital advisers are
present in every Chamber of Commerce and Industry (CCI) to help VSEs and SMEs learn
more about the benefits of digitisation within the context of their business. These advisers
have been trained and have tools allowing them to present Viadeo's offer to VSEs and SMEs
and demonstrate the power of an effective use of Viadeo.

The UAE (Union for self-employed people), and Viadeo signed a partnership in September
2013 to help self-employed people grow their professional social network and strengthen the
visibility of their business activities. In this context, 150K self-employed members of the UAE
were offered a six month Premium subscription for the purchase of a two month Viadeo
Premium offer in order to create, develop and run their professional network online. These
subscriptions come with a tutorial to help them use the platform.

The JCEF (Junior French Economy Chambers) and Viadeo signed a partnership in August
2013 giving 3 thousand young workers a one to three month Premium subscription as well as
training course on Viadeo. This partnership is designed to help them manage and optimise
their image on the professional social network.
In France, Viadeo's growth was driven by online offers subscribed for by members. These
subscriptions generate regular and predictable income while resulting in a negative working capital
requirement. The historically high profitability of the Group in France helped to finance its
international development.
39Very
Small Enterprisesand Small and Medium Enterprises
73
6.3.2.2 China, the first key area of growth
With a working-age population estimated by the World Bank at 787 million people and 618 million
Internet users40 in 2013, China is a powerful growth driver which the Group considers to be a strategic
priority. Viadeo's arrival in China in 2008 is a foundation of the Group's multi-local strategy through
the acquisition of the Chinese group Tianji. The Chinese Internet landscape, and more particularly the
social network landscape, is one of the world's richest and most specific, mainly due to regulations and
the government control of Internet services. Behind the "Great Firewall"41, the Chinese have built their
own e-businesses, their own applications and their own social networks. Thus, it seemed more relevant
and faster to penetrate the market by acquiring a local player through the acquisition in February 2008
of Wayson Technology Development Limited, owner of Tianji Boren Technology Development
(Beijing) Co., Ltd. and company controlling Beijing Yingke Times Information Technology Co., Ltd.,
as described in greater detail in sections 7.1 and 7.2 below.
2014 ranking list of the top six websites in China, the United States
and worldwide
Rank
China
United States
Worldwide
1
Baidu
Google
Google
2
Tencent
Facebook
Facebook
3
Taobao
YouTube
YouTube
4
Sina
Yahoo!
Yahoo!
5
Hao 123
Amazon
Baïdu
6
Weibo
Wikipedia
Wikipedia
Source: Alexa, April 2014
Created in 2005, Tianji operates the www.tianji.com website, currently the largest PSN in China,
dedicated to middle and upper-class working-age people. Tianji is an independent legal entity and an
independent company in terms of technology (dedicated platform) and marketing. Tianji holds the
leading position42 in the Chinese market with more than 20 million members at the end of March
2014.
Tianji's monthly figures32:
-
3.9 million unique visitors43;
around 715 thousand new profile data collected;
around 269 thousand contact requests accepted (increase in network density).
40Sources:
Research Macquarie, April 2013
"Great Firewall" is the nickname given to the Internet monitoring program launched in 1998 by the local authorities in
China.
42
"Company estimate”. See Section 6.2.3.2
43Source: Google Analytics
41The
74
Evolution of the number of members in China
25,000,000
20,000,000
15,000,000
10,000,000
5,000,000
2014-01
2013-10
2013-07
2013-04
2013-01
2012-10
2012-07
2012-04
2012-01
2011-10
2011-07
2011-04
2011-01
2010-10
2010-07
2010-04
2010-01
2009-10
2009-07
2009-04
2009-01
-
Source: Viadeo
Thanks to the acquisition of Tianji, the Group is able to offer a website that is 100% Chinese, tailored
to local practices, and with a specific positioning. Tianji chose to position itself around three core
values: professional image, trust and happiness at work. Tianji tuned its offer and designed its
functional features specific to China based on those values. For example, Tianji helps Chinese
professionals by providing trust and transparency, a key requirement in Chinese business due to
increasing fraud over the past years with forged diploma and CVs, particularly on Internet.
Tianji offers a whole range of specific functional features44:
-
-
-
the "verified profile", a feature which enables members to submit their profile information for
approval by their network of contacts (nearly 100 thousand profile verifications since January
2014);
the "HR Ranking", which allows users to compare themselves with others on a ranking list
based on their experience and their contacts and on a broader scale, their image and
professional influence (over 6.5 million members had a two star or more ranking as of April
2014);
finally, like Facebook, the website offers the "career evaluation test" kind of feature which,
through a questionnaire of twenty or so questions, allows one to perform a self-assessment or
to assess contacts who wish to input, and thus improve the quality of the information provided
to recruiters. Around 440 thousand Internet users have run this test since the end of 2013.
In addition, the website's layout was made to match Chinese tastes and its ergonomics were tailored to
suit local preferences (for example, the location of buttons on the various website pages).Tianji home
page
44
Source: Viadeo
75
Tianji is now in a phase of winning market share. Revenue generated in China only represents 3% of
the Group's consolidated revenue from operating activities. However, the Viadeo Group believes that
the growth prospects are compelling and that its leading position in the Chinese market combined with
its strong local presence will be the drivers of this growth.
6.3.2.3 Russia
Much like China, Russia is also a market where business practices are significantly marked by local
requirements. There are major cultural differences and the Internet environments are different (search
engine, webmail providers, etc.), therefore local players have a decisive advantage.
Ranking list of the top six websites in Russia, the United States and worldwide
Rank
Russia
United States
Worldwide
1
Yandex
Google
Google
2
VK
Facebook
Facebook
3
Google
YouTube
YouTube
4
@mail.ru
Yahoo!
Yahoo!
5
YouTube
Amazon.com
Baidu
6
Odnoklassniki
Wikipedia
Wikipedia
Source: Alexa, April 2014
Russia is the leading European market in terms of number of Internet users and still has major growth
prospects.
Viadeo's establishment in Russia was sealed by a joint-venture with the Sanoma media group.
The Finnish group Sanoma, listed on the NASDAQ OMX, has been operating in Russia for the last 20
years in the field of written press and also in digital media on the Internet with titles such as The
Moscow Times, Cosmopolitan, Harper's Bazar, etc.
The joint-venture between the two companies was established on a 50/50 basis in order to cover the
Russian markets and those of the CIS countries. Sanoma provides its expertise of Russian-speaking
76
markets and local teams which are capable of steering the business. Viadeo provides the PSN
technology platform and mobile applications, which are managed and updated on a regular basis by
staff located at the Paris headquarters. Sanoma also provided the joint-venture with a web portal
(RB.ru) dedicated to Russian professionals (RB standing for Russia and Business), whose contents and
audience generate revenue through advertising. The company Viadeo.ru is located in Sanoma Russia's
headquarters and has 19 employees.
On 31 October 2013, Sanoma announced a strategic review regarding its business activities in Russia
and countries of the CIS45. To the Company's knowledge, Sanoma's strategic review is still ongoing at
the date of this document de base. The Company will review the available options in due course, based
on Sanoma's decision following its strategic review.
Viadeo.ru homepage
The strategy adopted in Russia is focused on the growth of the members' community backed by a
strong local presence. As a result, the Group decided not to charge or generate revenue from online
subscriptions; therefore all members have Premium accounts for free.
Revenues arise primarily from the sale of marketing and advertising products of which a large part is
generated by the RB.ru website.
6.3.2.4 Africa
The Group had a presence in Africa from the start, but opened an office in Morocco in August 2011.
Viadeo is established in French-speaking Africa, particularly in the Maghreb (Algeria, Morocco,
Tunisia) and in West Africa (Cameroon, Ivory Coast, Senegal, etc.). With around 3 million members
in March 2014, Viadeo holds a leading position in Algeria, Morocco and Senegal46.
Business operations are led from Morocco, the anchor point of the Group on the continent and a hub
for commercial deployment. The Casablanca office employed six people by the end of 2013.
45http://www.sanoma.com/en/news/sanomas-interim-report-1-january-30-september-2013-redesign-ahead
46
Source: Viadeo
77
True to its multi-local strategy, the Group aims to develop its base of members and become a local
benchmark in recruitment. In this market, Viadeo addresses the middle class, entrepreneurs, young
students and young working-age people. In order to reach its growth targets, the Group can rely on the
fast growth of the Internet. The Group also aims to become a leader in mobile social networking,
given the strong penetration rate of mobile devices. In fact, in Morocco, 80% of Internet users are
mobile users47. In order to achieve these goals, the Group offers a website in Arabic, has rolled out a
targeted communication plan, and has entered into partnerships with local market players. Thus in
Morocco, Viadeo teamed-up with the job board Be4job.com (www.b4job.com) and with the ANAPEC
(www.anapec.org), the National Jobs and Skills Development Agency.
In Africa, income is generated by recruitment and marketing services. However, since the second
quarter of 2014, Viadeo members in Africa have the possibility to subscribe online for Premium
features.
In the recruitment and advertising markets, Viadeo aims to attract the top 500 Moroccan companies as
well as Moroccans living abroad and foreign companies, French ones in particular, established in
Morocco.
6.3.2.5 Viadeo members’ characteristics
Viadeo's base of members in each key geographic region covers a wide range of working-age people
in all age groups, all business lines and all professional positions. This diversity reflects the
penetration of the network in the working-age population and the local economy and therefore
demonstrates the importance of the multi-local strategy.

In France:
Viadeo's strong focus on its historic market leads to a well balanced geographical coverage of
members across the country and a good breakdown in terms of age.
18% of the members are located in Paris, 5% in Lyon,5% in Grenoble, 4% in Toulouse and 3% in each
of Bordeaux, Lille, Lyon, Nantes and Marseille. In terms of age, the most common group is 25-35
years old.
Age groups covered
1
9
<20
8
20-24
16
25-35
36
21
36-44
45-55
>55
Source: Viadeo
More than twenty different business lines and positions were identified among the members; including
the main ones as follows:
47
Source: Agence Nationale de Réglementation des Télécommunications Maroc Bilan 2011
78
Main activity sectors covered
Main functions covered
11%
12%
10%
8%
6%
4%
2%
0%
20%
8%
7%
16%
15%
7%
10%
10%
9%
8%
5%
Consulting
Industry
Public sector
0%
Finance
Sales & Marketing
Production &
Quality
Management &
Strategy
IT & Telecoms
Source: Viadeo

In China:
The members of Tianji are mostly men (53%) aged from 25 to 34 years old (55%). 29% of them have
two to five years of professional experience and 36% have more than five years of experience.
Breakdown by age group
11%
34%
55%
18-24
25-34
35-50
Source: Viadeo
The members of Tianji are mainly located in large cities, such as Beijing (26.1%), Shandong (26.1%)
and Shanghai (18.5%). These working-age members are mostly in middle-management positions.
30%
40%
32%
24%
30%
20%
20%
8%
10%
0%
TMT
7%
Advertising &
Communication
11%
6%
Finance
10%
Consumer
goods
9%
12%
0%
Employees
Source: Viadeo
79
Middle managers
Senior managers
Directors
In Russia:
Half the members are 25 to 44 years old.
Age groups covered
7
11
<20
5
20-24
15
25-35
36-44
17
45-55
33
>55
Source: Viadeo
Like in France, the base of members covers more than twenty different business lines and positions:
16%
14%
12%
10%
8%
6%
4%
2%
0%
9%
10%
8%
7%
7%
6%
6%
4%
2%
0%
Industry
Consulting
Communication &
Media
14%
9%
7
%
Management &
Strategy
Finance
Source: Viadeo
80
Production
1&
Quality
7%
IT & Telecoms
Sales & Marketing

In Africa:
In Maghreb and West Africa, the base of members breaks down as follows:
% of
members
Country
Algeria
Morocco
Tunisia
23
35
14
Maghreb
72
Cameroon
Ivory Coast
Senegal
8
12
8
West Africa
28
100
In Morocco, as in China, the population is younger...
Age groups covered
2
5
13
<20
8
20-24
25-35
36-44
20
45
45-55
>55
Source: Viadeo
... and covers a wider range of business lines and positions.
14%
20%
12%
16% 15%
12%
15%
9%
10%
8%
8%
12%
8%
10%
10%
6%
4%
5%
2%
0%
0%
Industry
Public sector
Consulting
Sales & Marketing
Finance
Source: Viadeo
81
Production &
Quality
Management &
Strategy
IT &
Telecoms
6.3.3
The technology platform and IT organisation
The Viadeo Group is mainly a technology company. 45% of the Group's employees work in
technology related functions(IT development, product development, architecture, operations, design...)
spread across three offices (Paris, San Francisco, Beijing).
The service offering and the monetisation channels hinge on the broad suite of features provided to
users but also on member profile data and updates shared by members of the network. The Group's
architecture is shaped around two main platforms:
- The Viadeo platform for France and all the geographic regions;
- The Tianji platform for China.
Given the specific aspects of the service offering, the platforms are developed in-house.
The rapid development of the Group, the increase in data collected and the achievement of 50 million
users in volume, rendered necessary a structural evolution of the Viadeo technological platform
supporting all the website's online services. Therefore the Company decided to migrate the Viadeo
technology platform two years ago, while the Tianji technology platform was upgraded in 2012.
The features of Viadeo's technology platform infrastructure are as follows:
- more than 300 servers with over 100 GB of data collected every day;
- the same business logic architecture for all the products: Web, Mobile, Mails, Partnerships;
- a massive use of "Big Data" technologies;
- an asynchronous and real time update of the data in the data warehouses.
The specifications of the platform were defined in 2012, the building of the platform started at the
beginning of 2013 and it was adopted by all the development teams as of the second half of 2013.
Currently, 100% of these new features are implemented on this new platform. Major works were
undertaken since the end of 2013 to migrate old features from the old platform to the new one. In April
2014, the Group considers that the vital services and 30% of the new features have now been switched
to the new platform. The Profile, Groups and Address book functionalities, together with part of the
Search function, still need to be migrated as of the date of this document, while the Dashboard
migration is currently in progress. Migration of all the features of this new operating environment will
be completed by the end of 2014.
This new platform offers the following benefits:
- speeding-up Time-to-Market: in 18 months the rhythm of updates bounced from one new
version every six weeks to one new version a day;
- quick understanding of user behaviour and the possibility to fine-tune products thanks to new
built-in measurement tools;
- data architecture capable of supporting Viadeo's growth proven to support a traffic up to 20
times higher than the current traffic load;
- shortened loading time of the website (from 250ms to 60 ms, i.e. dashboard displayed 100%
faster than previously), improving user satisfaction and enabling a better ranking on search
engines;
- implementation of a built-in search engine based on an internal technology;
- optimisation of the personalised recommendations for each member thanks to an engine that
manages suggestions of different services: "People you may know", "Groups you may like",
"Jobs which may be of interest to you", etc.;
- quick and easy creation of applications for smartphones and tablets (see Paragraph 6.3.3).
82
The platform has been physically set-up since 2010 in the San Francisco area in the United States.
This decision gave access to an environment at the cutting-edge of technology both in terms of
expertise and in terms of resources.
Today, and thanks to this recent migration, the Group believes it has the technological capacity to cope
with any significant expansion of the website up to a factor 20. The Group has also implemented
measures aimed to secure its data by replicating it across several different data hosts. If its main
hosting partner were to experience any serious failure, the Group could restore its services in only a
few days by activating the required number of servers in the "Cloud". For an even higher level of
security, the Group plans to duplicate its hosting servers in the next 24 months, which could represent
Group investment of around €1 million.
The IT staff is divided between two offices:
- At 31 December 2013, the office in San Francisco comprised 11 engineers primarily in charge
of the data centre and the development of "search" features (search engine);
- At the same date, the Parisian office comprised 85 engineers working for several divisions and
dedicated to research and development of new products in collaboration with the marketing
teams. The organisation was also restructured after the change in platform, resulting in short
reporting lines, agile development methods and multidisciplinary teams.
The Group believes that it has all the necessary protection devices to prevent any kind of intrusion
attempt (for further information, see Chapter 4 "Risk factors").
In 2013, the Group invested more than €2.9 million to renovate the Viadeo platform and allocated
€1.3 million for development costs related to the Tianji platform.
6.3.4
The mobile revolution
The explosion in the use of mobiles (mobile phones and tablets) is a major development path for the
Group.
In order to seize the opportunities created by the development of mobile devices, the Group introduced
a specific development strategy using a dedicated in-house team. Thus, in late 2012, the Group
completely reworked the mobile applications for the Viadeo platform. The new mobile phone
applications now cover the main operating systems (iOS, Android, BlackBerry and Windows Phone).
These applications were supplemented by applications for tablets covering both iOS and Android
operating systems. The reworking of this set of applications enabled strong growth in mobile use,
increasing the audience by five times between 2012 and 201348.
48
Source: Viadeo
83
Growth in the number of unique visitors(1)
600 000
400 000
200 000
0
Growth in the number of visits/mobile apps sessions(1)
8 000 000
6 000 000
4 000 000
2 000 000
0
(1)
Outside China
Source: Viadeo
In March 2013, mobiles represented:
-
40% of Viadeo’s logged traffic;
one contact request each second established through a mobile application;
20% of mobile users who visited the “Jobs & Careers” section;
more than 520 thousand consultations of job opportunities;
23% of applications received by Viadeo recruiters.
Mobile usage allows users to prolong their experience, as they can connect at any time and in any
place and are offered a new way of exploring Viadeo. As an illustration, the iPad application, launched
in France in October 2013, offers a user interface adapted for the experience on a tablet, with a more
fluid navigation and adapted features(display of exclusive statistics of its network).
Three growth levers for the Group’s activities are more specifically:
-
availability of online subscriptions on mobile phones;
so-called “native" advertising (see paragraph 6.4.4.);
the development of recruitment services through a mobile application.
With respect to online subscriptions, a partnership between Viadeo and Orange was launched in
October 2012 to promote Viadeo applications to Internet users and mobile users on the Orange
network. This distribution partnership makes it possible to offer Orange customers simplified
84
registration and usage through their Orange account. Once acknowledged, the Orange customer enjoys
an experience, dedicated support and the possibility of taking out a Premium subscription by paying
for it directly through his/her phone invoice. This partnership helps to increase significantly Viadeo’s
visibility to Orange customers. Thus the Viadeo application is referenced among the "must-have"
applications of the "Orange and Me" applications that allows, for instance, for a user to monitor
consumption and the evolution of its mobile bundle. Based on sharing the subscription income
generated, this partnership could develop into greater integration between Viadeo and Orange.
With respect to recruitment and training services, since December 2013, 20% of mobile users have
visited the "Jobs and Training" section of Viadeo and more than 23% of job applications from Viadeo
members have thus been implemented through the use of mobile applications.
The Group is continuing its mobile strategy in 2014 by concentrating on four areas:
-
recruitment using the "face-to-face" function (see paragraph 6.4.2) and an alert function;
advertising income with the development of "native" advertising and subscriptions with a
revised Premium offer;
the user experience with a new V3.0 version of mobile applications showing a mobile
dashboard and improving usage and performance;
development of the audience through marketing campaigns and the launch of an Android
application for tablets in April 2014.
In China, this strategy is still in the early stages but will develop, taking into account the local usage
and especially the large number of existing Apps stores. The Group already has a mobile application
and considerable technological expertise, following the acquisition of the technology solutions
company, Zaizher.
6.3.5
Viadeo’s assets
6.3.5.1 The disruption in the recruitment market has created new opportunities
Faced with uncertainty and rapid changes in the economy, working-age people have become aware
that they need to work on their employability and are acting increasingly like entrepreneurs in charge
of their own careers. In this context, Viadeo has become an essential tool which enables them, in
particular, to manage their professional visibility on the Internet and their existing contacts, to create
new contacts for themselves and thus develop their network, which might attract the interest of a
potential employer or recruiter and give them access to job opportunities.
This development has resulted in the disintermediation of the recruitment market to the benefit of the
PSNs, and has created new opportunities for the Viadeo Group. In fact, Viadeo's value offer is greater
than that of mere job sites (Viadeo enables access to the most valuable candidates, i.e. passive
candidates) and employment agencies, and will enable it to gain market share in the online
"Sourcing market" as well as the recruitment and temporary work markets which in France are worth,
respectively, 150 to 200 million euros and 600 to 700 million euros49.
49
Source: Viadeo
85
6.3.5.2 A leading position in strategic markets
The Group has adopted a strategy that consists of identifying and concentrating its development on
geographical areas offering important growth prospects, with a strong national identity that it therefore
considers to be unlikely to be permeated by the American model. The Viadeo Group has thus chosen
to concentrate on four geographical areas and holds a leadership position in three of these areas50:
- China, the largest market in the world N°1 with more than 20 million members;
- France, Viadeo’s historic market  N°1 with nine million members;
- French-speaking Africa, the market of tomorrow N°1 with more than three million
members;
- Russia, the biggest market in Europe Reference player with nearly 0.8 million members.
The Group has implemented a multi-local approach in each of these countries, consisting of the
adaptation to the specific nature and local practices of the country so as to offer features that meets the
needs and customs of each market. The Group’s position in these high-potential markets will enable it
to seize the opportunities provided by the disruption in the recruitment market.
6.3.5.3 A membership database that is growing organically and constitutes a barrier
to entry
In each key geographical area, the Group's development also relies on the “network effect” that
enables the membership base to grow organically: by entering and updating their profiles, the existing
members enrich the website’s database which in turn attracts new members to the network. Each
member further seeks to connect with his/her professional acquaintances and thus also contributes to
the recruitment of new members
This membership base constitutes an important asset for the Group and represents a barrier to entry
into the professional social networking market, thus restricting the probability of the arrival of new
players. In fact, it is only when a critical size has been reached that the member database can be
monetised on the one hand and become self-sustaining on the other hand, allowing it to develop. This
critical mass cannot be defined in absolute terms but can be assessed in relation to the size and
maturity of the market. The Viadeo Group considers that it has attained this critical mass in France.
6.3.5.4 A powerful and extensible technology platform
The Group made major changes to its technology platform in the course of 2013 in order to deal with
the rapid development, which generated an increasing number of interactions between contacts and
swift growth of the membership base. The new platform centres on using the data from member
profiles and optimisation of the use of mobile devices (mobile phones and tablets). It further enables
daily updating as opposed to the previous updates that happened once a month or once every two
months and it can support growth in the membership base of up to hundreds of millions of registrants.
This platform improves the user experience by offering more relevant search functions, a user "graph"
that retraces a member’s network in real time and thus the option of implementing more complex
requests. The new platform will constitute a decisive asset for the Group in comparison with other
PSNs and Job Boards in its conquest of new market share.
50
Source: Viadeo, March 2014
86
6.3.5.5 A proven business model benefiting from strong growth prospects
The development of the Viadeo Group is based on a proven business model, generating regular
income from three different sources (online subscriptions, recruitment and training services and
marketing and advertising services).
This success has enabled the Group to affirm its leadership position with a brand that enjoys strong
recognition in its strategic areas, especially in France and in China, and it has been able to make the
investments needed so as to benefit from the strong growth prospects linked to the development of the
recruitment market and mobile device use as well as the internet explosion in Africa. Consequently,
the Group anticipates an increase in income from its recruitment and marketing services.
With respect more specifically to the mobile market, which in 2013 represented 43% of the traffic on
Viadeo, the Group believes it can benefit from the following growth levers:
-
-
the development of online subscriptions via mobiles;
the development of marketing and advertising income from, on the one hand "native"
advertising that allows Viadeo to supply content in the context of the user experience and RTB
(Real Time Bidding) on the other hand(see paragraph 6.4.4);
the development of income from recruitment services, with 23% of applications coming from
mobiles.
6.3.5.6 An experienced management team supported by highly qualified employees
The Viadeo Group currently relies on an international management team consisting of Internet and
recruitment market experts (see also paragraphs 15.1.3 and 17.1.2).
In addition to Dan Serfaty, co-founder and Chief Executive Officer of the Company, who supervises
the worldwide Viadeo’s operational activities , and Thierry Lunati, co-founder and Chief Operating
Officer of the Company, who is responsible for Viadeo’s technology strategy, the Group has an
Executive Committee consisting of experienced professionals including:
-
Jean-Paul Alves, Chief Financial Officer, who has held several positions in multinational
companies (Ernst & Young, Lagardère Services, AOL France) before joining Viadeo in 2008;
-
Olivier Fécherolle, Chief Strategy & Development Officer who, before joining Viadeo,
took part in 2000 in the creation of the Keljob.com website, was General Manager of the
company and, after it merged with Cadremploi.fr, contributed to the company’s entry into the
stock market in 2007 in Paris under the name Aden classifieds;
-
Peter Crosby, Chief Emerging Market Officer who, before joining Viadeo, created and
developed advertising and software at jb4, a publishing and research company in the field of
business finance.
87
6.4 A PROVEN BUSINESS MODEL
6.4.1
Sources of income
The Group’s activity generates three sources of income: online subscriptions sold to professionals,
income derived from the commercialisation of recruitment and training tools and services to
professional customers and finally, income connected to the commercialisation of marketing and
advertising services to corporate customers.
The Group’s growth has been financed historically by income from subscriptions paid by its members
but the Group considers that the growth opportunities lie mainly in the development of recruitment
and marketing services.
Notably, the Group has increased its income sevenfold (in € millions) in seven years:
88
The distribution of the consolidated income from the Group’s operating activities by type of income is
the following:
(In thousands of euros)
2013
15,793
%
2012
%
51% 15,938
57%
8,812
29%
7,537
27%
4,958
16%
3,916
14%
Other income
1,355
4%
342
2%
Total Income from operating activities 30,917 100% 27,733 100%
The Group operates its business by geographical area. Given the strategic nature of China, the country
is subject to individual monitoring. The distribution of income from the Group’s operating activities
by geographical area is as follows:
2013
France
29,374
%
2012
95% 26,692
%
96%
China
841
3%
302
1%
Russia
268
1%
314
1%
Morocco
Other
45
ns
37
ns
390
1%
387
2%
Total Income from operating activities 30,917 100% 27,733 100%
6.4.2
Income from "online subscriptions"
Income from member subscriptions is generated solely in Europe and Africa by members subscribing
to a Premium subscription. The revenue from Premium subscriptions in 2012 represented 51% of the
Group’s consolidated revenue.
The first usage level of the site is actually free but members only have access to a limited number of
features. Premium subscribers, for their part, have access to additional services enabling them to use
their network to its maximum potential (see above paragraph 6.3.1).
Subscriptions are bought in a single payment by the customer, using a bank card (99% of payments are
made this way) and are paid in full regardless of the duration of the subscription. Viadeo’s operating
costs are paid for within the legal limits for payments to suppliers.
The organic nature of the members’ database is viral in its development and requires very few
resources in terms of marketing.
To achieve customer loyalty and with the constant aim of improving the user experience, the Group
regularly offers new features.
6.4.3
89
The Group offers recruitment services providing:
-
the circulation of job opportunities;
direct search of profiles in the database;
development of an "employer brand" through communication products and "community
management".
The Viadeo Group’s offer, given the richness of the profiles (which, unlike a CV, provide a so-called
"360° view" since it presents candidates in various aspects: networking, career development, activity,
etc.) enables recruiters to contact passive candidates.
The Group has adapted its offer to the needs of the various customer segments by offering product
groupings and specific payment formulas. Commercialisation is performed by sales teams dedicated to
providing recruitment and training solutions. The group’s offer makes it possible to offer tailor-made
solutions by combining various products.

In France:
Commercialisation is performed through two main networks: directly to advertisers and indirectly
through advertising agencies specialising in "Human Resources". Sales forces are organised into sales
teams trained by a manager and defined by a general classification of customers, into: major
("corporate") accounts, recruitment professionals (Staffing) and SMEs. Finally, the Group has teams in
France's major cities (Lyon, Marseille, Toulouse, Bordeaux, Lille and Strasbourg).
A study led by the Group covering one thousand leading French companies51 showed that 20.8% of
them were clients of Viadeo in 2013.

In China:
The sales team is based at the Beijing headquarters. It markets the Group’s services mainly to
recruiters directly.
In Africa, the sales team is based in Morocco. It concentrates mainly on Morocco but can deal with
customers all over the continent. In view of its limited size, the organisation is simpler and the sales
teams are not specialised.
In Russia, the Group does not currently sale market recruitment services.
The services offered can be classified into the following major categories:
-
Circulation of job opportunities
Each recruiter can buy "packs" of advertisements that he/she uses as needed. Job opportunities are
published for 30 days in the "Jobs & Training" section of the Internet site and on mobile applications.
They are also shown on the homepage for members who meet the criteria defined. Recruiters can also
benefit from visibility and special terms for annual offers.
51
Source: Coface
90
In France, for example, Viadeo offers direct purchase of three job opportunity packs (prices as of the
date of this document):
-
€390 pre-tax per job opportunity for one posting,
€310 pre-tax per opportunity for three postings,
€290 pre-tax per opportunity for five postings.
The group also proposes various other packs that can be adapted to specific customer needs by the
sales teams. The group also proposes circulating offers abroad at different rates and adapted to the
country in question.
The purchase of a pack also enables a recruiter to benefit from additional services, consisting of:
-
-
personalised targeting: each job opportunity can be sent to members whose profile meets the
recruiter’s requirements (50 contacts provided per job opportunity),
management of job applications through a dedicated platform, Viadeo Recruiter,
multi-circulation and offers are compatible with the main multi-circulators (Broadbean,
Multiposting, Ubiposting, etc.).
Access to the "Profile Library"
Recruiters can access the members’ database, also known as the "Profile Library" so as to identify
potential candidates for the jobs they seek to fill. The wealth of information in the Profile Library
enables recruiters to carefully target the profiles (example: Management controller, age 35, five to
seven years experience) and they can then contact the chosen members.
This interface is very different from the search engine accessible from Viadeo’s public interface.
The "Profile Library", as a genuinely dedicated interface aimed at the professional recruiter, allows
intelligent management of recruitment while adapting to the methods of each recruiter. The "Profile
Library" thus allows recruiters to:
-
automatically manage each recruitment in the form of a project,
share the recruitment project with colleagues or managers,
use a multi-faceted search engine to identify members with the profile sought,
visit member profiles anonymously,
store interesting profiles in a pool,
use the integrated messaging system to target members identified,
simply publish a job opportunity from the same interface,
manage the applications received.
91
Example of the “Profile Library” interface
Example of the Search engine for accessing the “Profile Library”
92
The Profile Library is the ideal tool for contacting Viadeo’s most valuable members: "passive jobseekers": members who are not actively looking for a new job but who, upon reading a carefully
targeted message from a recruiter, may decide to job-seek actively.
Access to the Profile Library is marketed in the form of a user licence valid for one user and a
specified length of time (three, six, or 12 months). The Group also invoices additional costs that
decrease for each additional user added to the first licence.

Company pages
Company pages are the equivalent of the member profile but are aimed at corporate entities. These
pages represent a "mini-website" available to Viadeo viewers. Members can follow a Company page
to subscribe to the information it publishes. As a product based on the "Freemium" mechanism,
Companies have more than 60 thousand pages referenced in France; as a result of the free version
containing company information (members who work in the company, news, map, logo, etc.). The
paid subscription makes it possible to add to the information shown by adding up to three tabs:
-
-
Careers & Jobs: The tab for the "employer brand" communication tool makes it possible to
introduce the company’s HR policy as well as reference job opportunities shown on Viadeo,
Discussion: The "Community Management" tool, a discussion tab, makes it possible to
pursue discussion between the company and Viadeo members on various conversation topics,
launched at the company’s initiative. The tool has content moderation tools available,
One free tab: This tab can be used by the company to reference any content that it wishes to
enhance through Viadeo. By indicating the URL address of a site, this tab makes it possible to
show content on the "Company Page” to provide it with greater visibility. The app is easy to
use and the company can easily change the content to ensure that it stays up to date.
The paid options for the Company pages are marketed for the long term (six or 12 months). The price
is adapted to customer needs (from €5K a year and up to several tens of thousands of euros annually
for the most complete options) and is variable depending on the number of tabs subscribed to and the
amount of customisation requested by the customer.
93
Example of a “Career & Jobs” tab:
Example of a Company page:
94
-
Communications services
These services correspond to the commercialisation of advertising space (banners and advertising
links) destined for customers for projects related to recruitment or human resources issues. The
commercialisation of advertising space other than that previously mentioned is accounted for as
income from marketing and advertising services. Remuneration for these services is essentially
calculated when posted, in cost per thousand postings (CPM) or in bulk for certain specific categories.
Example of advertising
The recruitment and training services only represented 29% of consolidated revenue in 2013, but
offers strong growth potential for the future. According to the Group, 20% of the thousand largest
French companies recruit on Viadeo.
Recruitment and training services are currently marketed in France, China and Africa.
The customers are diverse, ranging from key accounts combining various services in a comprehensive
recruitment and communication strategy on social media to the SMEs who begin usage by circulating
offers of employment.
The Group’s clients include Accor, Allianz, Auchan, CapGemini, Ernst & Young, GFI, Groupe Open,
Meetic, Meditel, Michael Page International, Nestlé, Orange, Randstad, Société Générale, Spie,
Thalès.
95
6.4.4
Marketing and advertising income
Marketing and advertising income derives from the purchase of advertising space on the website or
email messages addressed to members. The Group offers a standard format (IAB) to advertisers in
strip or banner format, text blocks, etc. to reach targets that they have previously selected. The value
offer to advertisers lies in the combination of power and affinity allowing them to develop their
visibility, their performance or to develop a community, and through it their network presence.
Since Viadeo is particularly sensitive to respect the confidentiality of its members’ data, it has always
refused to pass on data to third parties. Advertising campaigns are run by the Viadeo teams and
advertisers only have access to Viadeo members’ contact details when the latter agree to click on an
advert and transmit their data.
The "Marketing Sales Solutions" hub teams are charged with selling advertising space generated by
the traffic and usage of the Viadeo network by members, by allowing communication of brands to
them. The attractiveness of the sales offer lies in the very full profiles which make it possible to target
advertising campaigns with particular accuracy. This targeting is important for the following two
reasons:
- optimisation of the return on marketing investment for the advertiser;
- advertising that is better perceived by the Internet user because it meets his/her expectations
more accurately through the greater relevance of the message received.
The Viadeo group has a lot of information that is regularly updated about its visitors. Much of the
Viadeo Group’s traffic consists of members, who are identified when they navigate. Identification of
members, coupled with the information provided by the member himself/herself and supplemented by
the way the member behaves on the site, makes it possible to offer advertisers the opportunity to very
accurately target the people with whom they are seeking to communicate. The targeting criteria
includes, for example, the following information:
- job title and department of the job in question;
- gender and age;
- geographical location;
- key words shown in the description of the profile;
- size and sector of the company in which members work;
- number of years of work experience;
- level or type of studies;
- skills;
- usage criteria, events of significance on the profile, interest in certain topics, etc.
The advertisers cover every sector interested in targeting active job-seekers or those who want to
highlight their professional services.
The relevance of the offer makes it possible today for the Viadeo group to market most of the space
available on its site. Developments in the technology also offer new outlets for increasing the
monetisation of the audience:
- the launch of the platform on smartphones makes it possible to market new spaces;
- the development of video functionality makes it possible to incorporate "Pre-roll" (messages
launched prior to the video); and
- organising events through emailing campaigns.
Marketing and advertising services are marketed in all the countries in which the group operates.
96

In France:
In France, Viadeo is one of the most powerful sites, especially for the most active targets; Viadeo is
the 23rd largest French site in terms of audience52.
The "Viadeo Reach" product, recently and solely launched in France, offers an extension to the
targeting of Viadeo members.
By using the new "Real Time Bidding" techniques (or RTB), the Viadeo group can now offer its
advertisers the opportunity to circulate their advertising campaigns to a Viadeo member, even when
such a member is navigating on a site other than Viadeo. Real Time Bidding (RTB) consists of
allocating, in real time, Internet advertising space, based on bids offered by advertisers for formats and
specific targeting criteria corresponding to the profiles of surfers who consult pages on which the
advertising is displayed.
The internet
user
consults 1
web page
The
advertising
space is
auctioned
The winner
uses its
advertising
Auction for
interested
advertisers
The "Trading Desks" tools make it possible to identify, in real time, that the visitor to a partner site to
the RTB tools (most of the major publishing sites are partners in these networks) is a Viadeo member.
Once the member has been identified, Viadeo can purchase the advertising space in real time from the
third party site and display its advertiser’s campaign.
The advertising space is purchased cheaply because the partner website is not capable of defining this
visitor. As a Viadeo member, however, the person is identified and can thus be offered to an advertiser
that wants to target the advertisement and is therefore ready to pay a higher price.
Here again, members’ data is not sold to a third party and the advertising display perfectly complies
with the member’s desire for confidentiality.
52
Source: Alexa.com/April 2014
97
Operating scheme for the “Viadeo Reach” product.

In China:
In China, the Tianji website uses a separate platform and offers marketing and advertising services
adapted to the business practices of the Chinese market. While certain formats are specific, the
advantages and benefits offered are identical to those described above.

Russia and Africa:
In Russia and Africa, the services are identical to those offered in France. In Russia, however, the
Group also has a separate site (RB.ru) which makes it possible to increase the Group’s advertising
inventory. This content site was contributed by Sanoma when the joint venture was created (see
paragraph 6.3.2.3).
Income from the Group’s marketing and advertising services represented 16% of revenue from
operating activities in 2013. The Group includes clients such as: Air France, British Airways, BP,
Crédit Agricole, Chevrolet, Chrysler, EDF, Intel, Microsoft, M&S, Nokia, SAP, SFR,
Société Générale.
98
6.4.5
The sales and marketing organisation
6.4.5.1 The sales organisation
The Group has adapted its product to the needs of the various customer sectors by offering product
groupings and specific pricing formulas.
The sales departments are organised by types of product marketed:
-
recruitment and training solutions;
marketing and advertising solutions.

France:
Recruitment Solutions Department:
Commercialisation is performed by sales teams dedicated to recruitment and training. The Group offer
makes it possible to propose tailor-made solutions by combining different products.
Commercialisation is performed via two main networks: directly to advertisers and through
communication agencies specialising in "Human Resources".
The sales forces are organised in sales teams led by a manager and defined by the general categories of
clients. Key accounts ("Corporate"), recruitment professionals ("Staffing") and SMEs. Finally, the
Group also has teams in the major French cities (Paris, Lyon, Marseille, Toulouse, Bordeaux, Lille and
Strasbourg).
Marketing and Advertising Solutions Department:
The sales teams are organised into binomial groups, each dedicated to one of the main French
advertising agencies; direct contact with key accounts is also assured by the head of department. These
teams benefit from a team working together to ensure coordination between sales and media planning
as well as a team responsible for effective delivery and monitoring of the campaigns sold. These
departments work closely with the marketing departments that provide sales support in order to
optimise the relevance of the commercial dialogue, but also with the "Product" departments in order to
adapt the offer.

China:
In China, the sales teams are based at the Beijing headquarters and consisted of 27 people by the end
of 2013. They are divided into three teams that market:
-
recruitment services;
training services;
marketing and advertising services.
99

Africa:
Recruitment and training services:
In Africa, the marketing team is based in Morocco. It focuses primarily on Morocco but can handle
customers throughout the continent. Considering its limited size, it is organised more simply, and the
salespeople are not specialised.
Marketing and Advertising Services:
Advertising income in Africa is very much generated via PR and advertising agencies with which the
group has a commercial relationship. The sales teams concentrate on achieving commercial
relationships with these distributors.

Russia:
Marketing and advertising services:
The Russian sales teams benefit from being close to Sanoma Media since they are housed in the same
premises. They work in close collaboration with the partner’s sales teams to identify the advertisers
most likely to purchase services from Viadeo.ru and organise marketing operations and shared
initiatives.
Recruitment and training services:
In Russia, the Group does not currently market recruitment services. Only training services are
marketed. Considering of the limited size of the team, the organisation is simpler than in France and
the sales people rely heavily on the support offered by the French headquarters.
6.4.5.2 The marketing organisation
The marketing departments are charged with developing member usage, Premium subscription income
and the website brand awareness. These departments contain the following services:
-
a team responsible for professional customers provides “sales support”: definition of the sales
pitch, sales media and organising events (breakfasts, evening receptions, trade shows, etc.);
a team responsible for usage has the task of developing use of the website. For this purpose,
the team uses CRM tools that make it possible to optimise the various membership sections. In
countries that have Premium subscription income, the team also concentrates on recruiting
Premium members, maintaining their loyalty and optimising the various ways in which the
website is used (exploration, subscription, loyalty creation, etc.).
100

In France, the department consists of 23 people and also has the following services:
-
A "Business Analysis" team: the aim of this hub is to monitor and analyse all the key
management indicators with respect to the audience, usage, traffic, registrations, etc. It also
monitors the performance of the website’s various features and collaborates very closely with
the product heads who are responsible for continuous improvement;
A "Brand Compliance" team: this team is the guarantor of the Viadeo brand, visual identity
and ethics in all media. It is also responsible for the eight languages of the site and advertising
campaigns;
The "Members Support" team: a multilingual team offers support for all geographical areas
(excluding China);
A team responsible for partnerships which manages the localisation of services in the
geographical area. These partnerships generally cover two major types of responsibility:
media partnerships consisting of an exchange of visibility in order to promote Viadeo’s
reputation and strategic partnerships, the aim of which extends well beyond mere reputation,
and is designed to adapt the service and ensure that Viadeo has a strong local presence.
-
-

In China, the department consists of 15 people and the following services:
-
A team responsible for "Member Support";
A "Business Analysis" team that performs the same assignments as those described in the
previous paragraph.

In Russia and Africa, the departments are exclusively responsible for the localisation of
services in each market. They rely on central marketing services based in Paris for all other
needs. These localisation tasks mainly work in collaboration with the product team in order to
adapt features and to ensure coordination with the central translation teams to provide a "local
touch", making it possible to offer members perfect localisation and local partnerships.
101
6.5 MAIN DEVELOPMENT TARGETS
6.5.1
Increasing the number of members
Since the main asset is the members’ database, the Group objective is to increase the number of
members as well as the quality of data collected on the profiles.
In fact, if the network develops organically, the rate of development can be accelerated by regularly
offering to improve the user experience. The new technological platform and the launch of new
functionalities contribute to this improvement.
The Group further believes that developments in the recruitment market, the rapid increase in the use
of mobile devices and the explosion in the emerging markets described below will significantly
contribute to increasing the number of members of the network, in view of its leading position and the
high visibility from which Viadeo and to a lesser degree Tianji benefit in their respective markets.
6.5.2
Increasing income from the recruitment services
The 2000s witnessed the first phase of disintermediation in the job market, with the Internet revolution
and the appearance of Job Boards. This second decade of the 21st century is experiencing a second
disintermediation phase of the job market with the development of PSNs which, in addition to
identifying the most valuable candidates (the passive candidates), now make it possible to offer high
added-value services to companies, enabling them to recruit the same candidates directly. This second
phase undeniably offers growth levers to the Group and to its income from recruitment services.
The Group currently benefits from an acceleration of rebalancing between PSNs and Job Boards in the
Internet Sourcing market. The richness of the Group membership database represents a decisive
competitive advantage over the Job Boards. Consequently, Viadeo considers that the rebalancing in
favour of PSNs will continue in all the markets in which it exists and will enable it to increase its
market share in comparison to other jobsites in view of the fact that Viadeo and Tianji offer greater
added value.
As an example, in France, the deterioration of the job market has resulted in an increased flow of
candidates available to recruiters. In fact, according to APEC53, the average number of job-seekers per
published job posting increased in late 2012, with an average of 45 candidates per job in the last
quarter of the year. At the same time, the average number of job candidates per vacancy increased
from 20 in the first nine months of 2012 to 26 for the last quarter. This increase caused problems for
recruiters because it made the selection process more complex and lengthy. Some recruiters
questioned by APEC also had difficulties linked to the discrepancy between the profiles sought and
the candidates who applied. Faced with this situation, the Group’s offer allows for more relevant
identification and quicker selection of candidates.
The Group considers that the market could experience a new stage of disintermediation in the job
market during which the services offered by PSNs could develop in order to offer services likely to
compete with those of other intermediaries. The Group believes that this second disintermediation
stage in the job market represents a potential market worth between 500 and 600 million euros in
France for PSNs.
53
APEC Study, "Candidatures sur offre", October 2013
102
For the past five years, the use of social networks for recruitment has constantly increased, even if the
circulation of job opportunities remains the main means of recruitment. APEC54 has also established
that the more that companies recruit senior staff, the greater their recourse to social networks as a
means of Sourcing: sixty-five per cent of companies who recruited more than 100 executives in 2012
used this type of site for their most recent executive recruitments.
The reasons why recruiters use social networks are the following55:
The role played by social networks
2012 (1)
Direct contact with potential candidates
78%
Reaching candidates who are not typically found on the Job Boards
61%
Circulating job opportunities to your contacts
41%
Direct publication of the job opportunity on social networking sites
37%
Checking or supplementing the information stated in candidates’ CVs
27%
(1)
In % of companies who used a social network for their most recent recruitment.
Source: APEC study entitled “Sourcing Cadres”, June 2013
Once again, the Viadeo Group has undeniable advantages for surfing this wave of disintermediation,
with a better value offer than those of the main players.
Viadeo: an ultra-competitive product
54
55
APEC Study, "Sourcing Cadres", June 2013
Source: APEC, June 2013
103
6.5.3
Taking advantage of the huge rise in mobile device usage and new prospects
for income
Nine months after the launch of a complete set of applications, mobile devices already represent 43%
of “logged” visits, i.e. 43% of members who connected contacted the Viadeo site through their mobile
phone, and 23% of job applications received by recruiters who had a Viadeo presence were made from
a mobile device, a phone or tablet56. The take-off of mobile use thus constitutes an important growth
lever for the Group through its ability to collect useful data to the recruiter as well as through the new
sources of monetisation it provides. This new form of consumption will increase and the Group is
already offering new forms of payment that are better suited to mobile use and that enable better
monitoring of development over the various platforms.
Since 2011, sales of mobile devices of the Smartphone type have exceeded worldwide deliveries of
PCs57 and Ericsson forecasts an average of 20% growth in the number of subscribers between 2013
and 2019.
The take-off of mobile usage will make it possible to develop advertising on mobile devices and
income from marketing services. The extension of the Group’s ability to target members who are
visiting other sites using RTB (Real Time Bidding) techniques, for example, represents an opportunity
for increasing this income. By using the RTB technique, the Group can increase its available inventory
by targeting its members while they are visiting other sites (see the Viadeo Reach product presented in
chapter 6.4.4)
Finally, the Group considers that the 4th generation (4G) telephone frequencies will contribute heavily
to accelerate mobile use of PSNs. 4G will enable internet access via a Smartphone at a speed
equivalent to that of a very high-speed broadband , thus reducing the uploading and downloading
times considerably. Ever since the acquisition of 4G licences in 2011, the main mobile phone
operators have begun their 4G network roll-out, at first for businesses, then from 2013 for individuals.
According to the French Agencenationale des fréquences (ANFR), 12,069 sites were authorised by
56
57
Source: Viadeo
Source: Canalys 2012
104
1st December 2013 for very high-speed mobile telephony and 14,293 sites by 1st April 2014, taking all
operators together, an 18% increase.
6.5.4
Benefiting from the explosion in the emerging markets
According to a Barclays research note published on 31 March 2014, the world penetration of the
Internet was 5.9% at the start of the millennium and experienced a phenomenal growth with an annual
average 16.4% growth rate between 2000 and 2012, in terms of number of users. The average rate of
penetration throughout the world is currently 35%, i.e. 2.5 billion users mainly in the developed
markets such as the United States, Japan, Germany, France and the United Kingdom, all of which have
a rate of penetration greater than 80% (see below).
The next wave of adoption will come from the emerging countries, especially in Asia and Africa,
where penetration remains well below the world average, with only 27.5% and 15.6% of penetration
rate respectively.
World Internet penetration
With the development of new Internet user networks in Asia and Africa, numerous new opportunities
will present themselves with a tendency to digitise basic services for a large population, such as
banking and healthcare services.
105
Viadeo is becoming part of this dynamic since it is currently a leader in the Chinese, Russian and
African markets.

China
Growth in the Chinese market has truly accelerated since mid-2011. With 20 million members by late
2013, Tianji clearly emerged and acquired true recognition.
Continuing to develop in China will require more important investments in order to accelerate its
development and quickly reach a critical mass as well as being able to monetise its audience as from
2015. According to the IDC research bureau, the number of PSN registrations should reach 94 million
in 2015, as against 31 million in 2011, and could generate 223 million in revenue by that date58. This
growth will be maintained during the course of future years by the 6 million or so graduates entering
the labour market annually and the high level of Internet use in social networking.
At any event, the Group considers that Tianji’s number one position will enable it to benefit most from
the growth potential in the Chinese market and establish its advance over local competitors.

Russia
For its part, Russia is still an emerging market and one that is not very structured with considerable
local specificities.
The Group’s development strategy is based on the value proposal whereby Viadeo is the development
tool for professional networking. The Group thus targets, as a priority, Russian executives and young
job-seekers, with the aim of subsequently targeting more specific sectors of professionals in the
working population, such as entrepreneurs.
To ensure its development, the Group relies on its local partner, Sanoma, while benefitting from the
development of the Internet.
Increase in the audience and Internet penetration per type of city
Moscow
Audience (millions of users)
Internet penetration
2012/2013 growth
Cities
> 1 million
8.1
77%
+12%
13.5
71%
+6%
Towns
100 – 799K
Towns
< 100K
23.3
71%
+13%
31.2
51%
+10%
Source: TNS Gallup
The development of mobile phones in Russia, as in other key geographical areas, constitutes a growth
accelerator.
Development of ways of accessing the Internet
Internet access via desktop PCs
Internet access via mobile devices
(telephones and tablets)
Moscow
Cities
> 1 million
Other towns
> 100K
+12%
+45%
+6%
+34%
+13%
+48%
Source: TNS Gallup
58"The
Outlook for the Professional Social Networking Market in China", IDC (2011).
106

Africa
Finally, with respect to Africa, the Group’s priority is to increase the membership base and usage of
the network.
To achieve these development aims in Africa, the Viadeo Group is counting on the increase in Frenchspeakers. In fact, according to the Observatoire International de la Francophonie (OIF), the number
of French-speakers is growing strongly. This increase is mainly explained by the fact that Frenchspeaking Africa continues to use French, especially in the children’s education. According to the OIF,
the number of French speakers could reach 750 million by 2050, as against only 220 million French
speakers in the world in 201059.
Distribution of speakers of various languages in the world
Source: Natixis
According to a study conducted by Natixis60, the development of French in a geographical area that is
expected to experience strong economic growth constitutes a major opportunity for French companies,
especially those operating in the media and digital sectors. In its study, Natixis quotes the forecasts of
the World Bank which sees African GDP being multiplied fifteen-fold between now and 2050, and in
the conjunction with the development of French speakers and strong economic growth, the possibility
of easily reaching, thanks to digital technology, a much more ambitious market than that of France, by
positioning itself on local content.
Geographical distribution of the number of French-speakers in 2050
Source: Natixis
The Group will also benefit from Internet and mobile development in the areas in which it has a
presence: the numbers of Internet users and subscribers has increased rapidly in the course of recent
years.
59Interview
60"La
with Alexandre Wolff, Head of the Observatoire de la langue française, Challenges, 20 March 2014.
francophonie, une opportunité de marché majeure", Jérôme Bodin & Pavel Govciyan, Natixis
107
Development in the number of Internet users
(historical data and forecasts in thousands of users)
20 000
15 000
10 000
5 000
0
2009
2010
2011
2012
2013
Senegal
2014
Tunisia
2015
2016
2017
2018
Morocco
N.B.: for Morocco and Tunisia, the data shown is historic data prior to 2013 and forecasts subsequent to that date; for
Senegal, the data shown are historic data prior to 2012, estimates for 2013 and forecasts subsequent to that date.
Increase in the number of broadband subscribers
(historical data and forecasts in thousands of subscribers)
4 000
3 000
2 000
1 000
0
2009
2010
2011
2012
Algeria
2013
2014
2015
Morocco
2016
2017
2018
Tunisia
N.B.: the data shown are historic data prior to 2013 and forecasts for subsequent dates.
Evolution of numbers of mobile phone
suscribers
(historical data and forecast in thousands of subscribers)
60 000
40 000
20 000
0
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Algeria
Morocco
Tunisia
Senegal
N.B.: for Algeria, Morocco and Tunisia, the data shown are historic data prior to 2013 and subsequently forecasts; for
Senegal, the data shown are historic date prior to 2012, estimates for 2013 and forecasts beyond that date.
108
Faithful to its multi-local strategy, the Group counts on applying, on the one hand, a positive image of
France in Africa and, on the other hand, the strong demand for an alternative cultural model to the
English speaking model in order to develop its activities.
6.5.5
Improving operational efficiency
The Group will continue its investment policy in order to improve its technological platform to
support the development of its membership base and use the data it has collected of member profiles.
It also intends through its research and development operations to offer new functionalities so as to
improve the user experience, and that of its members in particular on mobile devices.
On an organisational level, the group aims to:
-
-
continue to grow its turnover;
o in France by continuing to develop its three types service (recruitment and training
services, marketing and advertising services, on-line subscriptions),
o in other geographical areas (China, Russia and Africa) in particular, by launching
sources of revenue that have not yet been activated;
improving commercial productivity;
improving operating profitability.
109
7
ORGANISATION CHART
7.1
LEGAL ORGANISATION CHART
At the date of this document de base, the Group has the following legal organisation chart:
Viadeo SA
(France)
Tianji Group
APVO Corporation
(United States)
100%
100%
"Wayson"
(Hong Kong)
100%
"Viadeo IM" B.V.
(The Netherlands)
"Boren"
(China)
50%
(1)
100%
"VIM" LLC
(Russia)
Viadeo Maroc SARL
(Morocco)
"Yingke"
(China)
100%
Viadeo Limited
(United Kingdom)
100%
Soocial B.V.
(The Netherlands)
100%
99.99%
"ApnaCircle"
(India)
100%
Sabri SARL
(France)
0.01%
(1) Xiaoje Wu and Yingshou Guo each hold 50% of the capital of Yingke. Wayson exercises contractual
control over Yingke due to agreements between Yingke, Boren and Wayson, as described in section 7.2
of this document de base.
7.2
COMPANIES OF THE GROUP
The Group consists of two platforms operated under distinct brands: Viadeo, which is the international
platform, and Tianji, which is the Group's platform dedicated to the Chinese market.
At the registration date of this document de base, the Group is made up of the Company, its eight
subsidiaries and its three sub-subsidiaries, as presented below:
Viadeo SA: created in December 2005 under the name VIADUC, the Group's parent company and
registered office, Viadeo SA is the decision-making and support centre for the Group. The Company is
also home to some of the development teams for the Viadeo platform. In this context, Viadeo S.A.
issues the invoices for the income related to the recruitment and training solutions, the marketing
services, and also for all of the Group's marketing subsidiaries (excluding China) on the basis of the
operating rights granted to it by its US subsidiary, APVO Corporation.
110
APVO Corporation ("APVO"): created in 2010, this San Francisco-based subsidiary is home to all
of the Group's technological assets for the Viadeo platform (excluding China), including the website
and membership database. In this capacity, this entity issues the invoices for the income related to
premium subscriptions (online subscriptions) and grants the Company operating rights for other
activities, namely, at this date, "Recruitment and Training" and "Marketing and Advertising".
Tianji Group
The Chinese Tianji group was acquired by the Company in February 2008. It has a dedicated platform
and its own infrastructures (technical and product development, marketing, sales and support
functions), and is made up of three companies:
Wayson Technology Development Limited ("Wayson") is a Hong Kong law holding
company,incorporated on 10 October 2007 and wholly-owned by the Company. Wayson owns 100%
of the capital of Tianji Boren Technology Development (Beijing) Co., Ltd. ("Boren"), a company
incorporated under Chinese law incorporated on 18 December 2007.
Beijing Yingke Times Information Technology Co., Ltd. ("Yingke", together with Wayson and
Boren, the "Tianji Group") is a company incorporated under Chinese law on 12 August 2004.
Yingke owns Tianji, the Chinese professional social network. As current Chinese legislation restricts
foreign investment in companies active in value added telecommunication services in the People's
Republic of China, the parties have entered into a series of contracts, including an exclusive agreement
for technical services entered into between Boren and Yingke (the “Service Agreement”), pledges of
shares (the “Share Pledge Agreements”) and call option agreements (the “Call Option
Agreements”) granted by Yingke's shareholders, namely Xiaoje Wu and Yingshou Guo61, for the
benefit of Boren, and no-amendment agreements entered into between Wayson, Boren, Yingke and
Yingke's shareholders. These agreements, described in more detail below, give Wayson de facto
control of Yingke, despite Wayson not having directly invested in Yingke's share capital. In this
context, and in respect of Chinese law, Yingke is deemed to be a variable interest entity, the
subsidiaries and consolidated financial results of which are included in the Group's consolidated
financial statements for the year ended 31 December 2013.
The Service Agreement entered into between Boren and Yingke on 18 January 2008 is an open-ended
contract that can only be terminated with Boren's consent. It covers the different services provided to
Yingke by Boren, in particular (i) technology development services, (ii) training, technical support and
support services to Yingke's teams and (iii) consultancy services. In exchange for the services
provided, Yingke pays Boren 90% of its revenue (after deducting a reasonable amount for operating
costs). The service agreement is exclusive on a non-reciprocal basis, i.e. Yingke has undertaken not to
enter into agreements with other service providers other than Boren without Boren's written consent.
However, Boren is entitled to offer its services to other entities. Should Yingke fail to comply with its
commitments under the Service Agreement, Boren may exercise its rights under the Share Pledge
Agreements (see below) and apply the sanctions envisaged there under.
As a guarantee for the commitments made by Yingke under the Service Agreement, Messrs Xiaoje
Wu and Yingshou Guo - Yingke's two shareholders - each signed a Share Pledge Agreement on 18
June 2008 in favour of Boren, covering all the equity securities they hold in Yingke. The Share Pledge
Agreements guarantee all of Yingke's obligations and, in particular, payment for the services provided
by Boren and, in the event of a breach by Yingke, compensation for damages due to Boren, as well as
the costs and expenses incurred by Boren to protect its rights under the service agreement. The Share
61
Xiaoje Wu and Yingshou Guo do not carry out any operational roles within the Group.
111
Pledge Agreements remain in force for two years after the due date of the guaranteed commitments.
Yingke's shareholders may not transfer or dispose of the pledged shares in Yingke in any way
whatsoever. In particular, Boren may exercise its pledge rights by (i) having the pledged Yingke
securities transferred to Boren at a price to be determined by the parties, (ii) selling the pledged
Yingke securities to a third party and deducting the amounts due to Boren from the selling price, or
(iii) selling the pledged Yingke securities by auction.
Under the terms of the two Call Option Agreements signed between Boren and Xiaoje Wu, on the one
hand, and Boren and Yingshou Guo, on the other hand, the two Yingke shareholders both agreed to a
call option in favour of Boren covering all the equity securities they hold in Yingke. These call options
may be exercised by Boren or by any third party appointed by Boren at an exercise price equal to the
amount paid by each of Yingke's shareholders at the time they subscribed to Yingke's shares. Boren
may exercise the call options, or part thereof, throughout their term of validity (with the specification
that they remain valid until termination of the Service Agreement). Should Yingke's shareholders fail
to comply with their obligations under the call option agreements, Boren is entitled to request that the
contracts be performed (exécution forcée). Should the exercise of the call options by Boren turn
Yingke into a "foreign-invested enterprise" under Chinese regulations, the two Yingke shareholders
have committed to provide Boren with all the required support to obtain the authorisation of the
Chinese authorities to be the legal shareholder of Yingke.
In addition, the two Yingke shareholders both undertook not to transfer their stake in Yingke without
the prior written consent of Wayson and, upon Wayson's first demand and to the extent allowed by
Chinese law, to transfer their holding in Yingke to Wayson or to a third party designated by Wayson.
These commitments will continue to apply until the expiration date of the Share Pledge Agreements.
Lastly, Wayson, Boren, Yingke and each of Yingke's two shareholders entered into "nonmodification" agreements (together the "Non-Modification Agreements") to the Service Agreement,
the Share Pledge Agreements and the Call Option Agreements (together the "Yingke Agreements"),
prohibiting any modification to the Yingke Agreements without the prior written consent of Wayson, a
wholly-owned subsidiary of Viadeo. The Non-Modification Agreements will remain in force until the
parties jointly decide to terminate them.
ApnaCircle Infotech Private Limited("ApnaCircle"): acquired at the end of 2009, ApnaCircle is
developing a professional social network in India. As part of the strategic re-evaluation of the Group's
assets, the board of directors of the Company decided, during its meeting held on 18 June 2013, to
discontinue ApnaCircle's activities as of 1 July 2013. At the registration date of this document de base,
ApnaCircle is dormant. The members, integrated in the Viadeo platform, are now managed from the
Company's head office.
Soocial B.V.: acquired in December 2011, this Dutch company has developed a tool for synchronising
address books (managerial contacts), some functions of which are now integrated into the Viadeo
platform.
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Viadeo Independent Media B.V. ("Viadeo IM"): this Dutch company is a joint venture created with
the Russian media group Sanoma in October 2011 (the Company and Sanoma each holding 50% of
Viadeo IM). Viadeo IM handles business development for the Viadeo platform in Russia and Russianspeaking countries through the Russian subsidiary Viadeo Independent Media LLC ("VIM"). A
shareholders' agreement was entered into on 18 November 2011 between the two shareholders of
Viadeo IM, namely the Company and Independent Media Holding B.V., as well as various companies
from their respective groups. In particular, this agreement provides that decisions relating to the
management of Viadeo IM will be mutually agreed by the parties. In the event of a significant breach
by one party of its obligations under the agreement, the non-defaulting party may either acquire all of
the other party's interest in Viadeo IM at a discounted price, or have the defaulting party acquire all of
its interest in Viadeo IM at its market value.
Viadeo Maroc SARL ("Viadeo Maroc"): created in August 2011, this subsidiary handles business
development for Viadeo in sub-Saharan Africa and the Maghreb.
Viadeo Limited: created in 2007, this English subsidiary comprises the Group's support activities for
emerging markets.
Sabri SARL: this subsidiary comprises a support activity for preparing one-off receptions organised
by the Group.
The Group also has a Mexican subsidiary, Viadeo Mexico S. de R. L. de C.V., which was wound up
by decision of its partners on 11 March 2013, it being specified that, at the registration date of this
document de base, this subsidiary is still in the process of being wound up.
In addition, the Group holds a non-consolidated interest of 9.55% in the holding company
ChinaBizNetwork Corp. (CBC) – a holding company which groups together the historical
shareholders of the Chinese professional network Tianji (Beijing) -following the subscription by the
Company to two share capital increases carried out by CBC in October 2007 and amounting to $5.1
million, prior to the Group's acquisition of the Tianji platform. At the registration date of this
document de base, CBC's assets consist solely of shares held in the Company following the conversion
of bonds in July 2009 (representing 1,124,825 shares of the Company after the 25-for-1 division of the
par value of the shares of the Company, as decided by the shareholders' meeting held on 21 May
2014). As at 31 December 2013, this investment was valued at €246K in the Group's consolidated
financial statements.
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The key figures for the Company's main subsidiaries and sub-subsidiaries at 31 December 2013 were
as follows:
In € thousands at 31
December 2013*
% held
Shareholders'
equity
(including
share capital)
Share
capital
Revenue
Net
income
Subsidiaries and subsubsidiaries
APVO
100%
6,275
(1,110)
16,915
(3,468)
100%
0
235
508
18
Sabri SARL
100%
8
10
411
(12)
Viadeo Maroc
Wayson (2)
100%
100%
4
17,490
15
1,994
161
841
7
208
50%
90
1,825
532
(708)
Soocial
100%
53
847
666
738
ApnaCircle
100%
49
203
608
40
Viadeo Limited
(1)
Viadeo IM BV (3)
* Based on Euro/currency conversion at 31 December 2013
(1) Share capital of £1
(2) The figures include Wayson, its subsidiary Boren, and Yingke, which together form the
"Tianji" group as described above.
(3) The figures include Viadeo IM BV and its subsidiary Viadeo IM LLC.
7.3
MAIN INTRA-GROUP FLOWS
7.3.1
Business development service agreements
The Company and APVO issue invoices on behalf of all Group companies in all countries where the
Viadeo platform is used, excluding China.
APVO issues invoices for the income related to premium subscriptions (online subscriptions) and the
Company, which has been granted operating rights by APVO, issues invoices for all recruitment and
training services, and marketing and advertising services.
Service agreements between APVO and the Group's subsidiaries (excluding China and Russia)
APVO has entered into agreements with all Group companies on behalf of which it issues invoices for
subscription income; these agreements cover services rendered by the subsidiary concerned to APVO
as part of the promotion and development of the Viadeo platform in the regions covered by said
subsidiary.
In compensation for services rendered, each subsidiary invoices APVO for expenditure incurred, plus
a margin of 5%.
During the year ended 31 December 2013,Group subsidiaries invoiced APVO a total of USD 1,383K,
i.e. €1,042K.
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Service agreements between Viadeo SA and its subsidiaries (excluding China and Russia)
The Company has entered into agreements with all Group companies on behalf of which it issues
invoices for recruitment and training solutions, and services relating to banner ad campaigns; these
agreements cover services rendered by the subsidiary concerned as part of the promotion and
development of the Viadeo platform in the regions covered by said subsidiary.
In compensation for services rendered, each subsidiary invoices the Company for expenditure
incurred, plus a margin of 5%.
During the year ended 31 December 2013, Group subsidiaries invoiced the Company a total of
€1,190K.
7.3.2
Licensing fees
Fees payable under the licence agreement entered into between APVO and the Company
In September 2010, the Company and APVO entered into a licence agreement; this agreement gives
APVO the operating rights for certain domain names and trademarks required to use the Viadeo
platform. Pursuant to this agreement, the Company also provides APVO with recruitment and training
solutions, and services relating to banner ad campaigns. The Company invoices for the subscription
payments of APVO customers in all countries where the Viadeo platform is used.
Pursuant to this licence agreement, APVO must pay a monthly fee corresponding to 1% of its total
revenue for the month.
In addition, APVO must pay the Company an amount equal to 105% of the product (i) of the expenses
incurred by the Company in providing the services to APVO and (ii) the number of hours worked by
the Company's employees for APVO as a ratio of the total number of hours worked by the Company's
employees.
During the year ended 31 December 2013, APVO paid a total of €125K in fees to Viadeo SA.
Fees payable under the licence agreement entered into between the Group and Viadeo IM
On 1 January 2012 the Company and APVO entered into a licence agreement with Viadeo IM. This
licence agreement provides that the Group authorises Viadeo IM to use, without territorial restrictions,
the Viadeo and Unyk trademarks (and the associated copyright), as well as the www.viadeo.ru and
viadeo.com/ru domain names required to use the Viadeo and Unyk platforms, with a view primarily to
creating and developing the professional social network Viadeo.ru and the Russian version of the
Unyk address book. The agreement stipulates conditions for termination similar to those for the joint
venture between the parties.
Pursuant to this licence agreement, Viadeo IM BV paid €1,180 in 2013.
115
7.3.3
Financial flows
As part of the financial support given by Viadeo SA to its consolidated subsidiaries, the Company
grants loans and advances to its subsidiaries.
These loans and advances are paid at a fixed rate of 5% per annum.
At 31 December 2013, the amount of loans and advances granted to the Company's subsidiaries was
the following:
- Wayson: €17,138K;
- APVO: €1,300K (of which €49K in interest);
- Viadeo IM: €746K;
- Viadeo Maroc: €1K.
116
8
ENVIRONMENTAL FACTORS LIKELY TO INFLUENCE THE USE OF THE
GROUP'S ASSETS
8.1
ENVIRONMENTAL ISSUES
The nature of the Group's business activities is not likely to have a major adverse impact on the
environment.
117
9
OPERATING AND FINANCIAL POSITION OVERVIEW
The reader is requested to read the following information regarding the Group's financial position and
results together with the Group's consolidated financial statements prepared in accordance with IFRS
for the years ended 31 December 2013 and 2012, as included in Chapter 20 of this document de base.
The Group's consolidated financial statements were prepared in accordance with IFRS as adopted by
the European Union for the applicable fiscal years. The consolidated financial statements for the years
ended 31 December 2013 and 2012 were audited by the Company's statutory auditors. A free English
language translation of their report is presented in section 20.4.1 "Statutory auditors' reports on the
consolidated financial statements for the fiscal years ended 31 December 2013 and 2012".
9.1 INTRODUCTION
9.1.1
The Group's business
Viadeo was founded by Dan Serfaty and Thierry Lunati in 2005. With nearly 60 million members
worldwide, it is a major player in professional social networks. The Group has adopted a differentiated
strategy which consists of taking local characteristics into account (so-called multi-local strategy) and
focuses on several key regions, such as France and China, where it is an industry leader in terms of
registered members (nearly 9 million members and more than 20 million members respectively) and
where it has a strong growth. The Group is currently built around two brands: Tianji in China, and
Viadeo in France and the rest of the world.
The Viadeo Group's websites (www.Viadeo.com and www.tianji.com, together with the
corresponding applications for mobile devices and tablets) offer services helping professionals to
promote their visibility on the Internet, manage their careers, identify new business opportunities and
stay connected with their contacts, thereby enabling them to monitor their business activity and create
an online directory which is easily accessible and up to date.
Moreover, the Group offers recruitment and training services to companies and sells advertising and
marketing services.
In 2013, the Group generated revenue of €30,917K and saw an operating loss of €(14,516K).
For the period presented (January 2012 to December 2013), the Group's business and operating results
were affected primarily by the following factors:

a significant investment was made to implement a new technological platform for the Viadeo
website in order to support the growing membership base and increased interaction between
members. This new platform is more effective and adaptable: faster features can now be
implemented online and mobile applications can be developed without relying on web-based
services. This investment resulted in capitalised development costs of €901K, together with
development and migration costs (training of technical teams, external consultancy costs, etc.)
expensed for €2,080K, which weighed on the Group's earnings in 2013;
118

revenue growth of 11% in 2013 thanks to the successful commercialization of recruitment and
training services offered to companies (+17%) and the strong growth in marketing and
advertising services (+27%). Revenue growth was strengthened by the renewed range of
"mobile" products, namely smartphone and tablet applications, which generated income
supporting the Group's very promising ambitions regarding the development and monetisation
of this product line, particularly given that mobile activity has increased fivefold between
2012 and the end of 2013 (from less than 100.000 unique visitors per month in May 2012 to
more than 500.000 in December 2013);

a strategic reassessment of the Group's international positioning and the decision to focus its
resources on the key regions: France, China, Russia and North Africa (primarily Morocco,
Tunisia and Algeria), led to the closure of six subsidiaries. Four of them were dissolved in
2013 (Senegal, Italy, Spain and Mexico). ApnaCircle, the Group's Indian subsidiary, is
currently being dissolved, whereas Soocial, the Group's Dutch subsidiary, has ceased its
business activities. Accordingly, the African market will be developed from a single office
located in Casablanca (Morocco), given that the Senegalese subsidiary has been dissolved.
The operating expenses incurred by the closed entities amounted to €1,442K in 2013;

the acceleration of investments in China, due to Tianji's position as a local leader and the
significant growth potential of the Chinese market. In particular, these investments resulted in
an increase in available resources (primarily through the recruitment of IT developers and the
creation of a middle-management level), significantly deepening the Group's operating loss.
These investments should help speed up growth in the membership base and in revenue
generated from training and recruitment solutions, together with "Marketing and advertising
solutions".
9.1.2
Main factors affecting the Group's earnings
Income from operating activities
Income from operating activities includes turnover and other operating income.
Turnover includes three types of revenues:

Revenues from online subscriptions (51.1% of revenues from operating activities in
2013) taken out by members of the Viadeo website. Based on the "Freemium" model,
members can take out a paid subscription online which provides access to a wider range of
features reserved for paying subscribers. Subscriptions are primarily taken out online
using a credit card or other online payment services (Paypal), or to a lesser extent by
cheques. The services offered are provided on an ongoing basis. From an accounting
perspective, these revenues are measured at the fair value of the consideration received or
to be received and are recognised pro rata temporis on a daily basis. At the closing of the
fiscal year, the share of revenue for billed subscriptions giving access to paid services over
the following period is recognised as deferred revenues;

Recruitment and training services (28.5% of revenues from operating activities in
2013): these services are the strategic focus of the Group's development; they can be
divided into three main product families: the posting of job advertisements on the Group's
website and mobile applications, access to the membership base via a specialised interface
119
for recruiters, and communication products aimed at the "Employer Brand". Job
advertisements generate revenue when they are posted, whereas recruitment and training
solutions are recognised temporis based on the period of services;

Marketing and advertising services (16.0% of Revenues from operating activities in
2013): these services are marketed through global communication campaigns based on
promotional materials in the form of advertising banners published on the Group's
websites and included in emails sent to members. They generally target a certain group of
members chosen according to the advertiser's goals. From an accounting perspective, this
revenue is recognised as the campaigns progress.
For these three types of revenues, the application of these revenue recognition principles leads to the
recognition of invoices to be drawn up and deferred revenues when the invoicing process is not in line
with the performance of services.
Other revenue is generated mainly from marketing operations (communication campaigns on thirdparty websites) carried out in the form of barter transactions. These campaigns ensure that Viadeo and
Tianji enjoy regular visibility among their targets.
Although the Company is little affected by seasonality, it nevertheless recorded:
 a summer season with a generally low rate of online subscriptions;
 a strong end of year in terms of revenues generated by marketing/advertising services and
recruitment/training services due to the renewal of these subscriptions (primarily on a yearly
basis).
Recurring costs with an impact on operating income are mainly as follows:
Staff expenses
Staff expenses are the Group's main expenses. A significant portion of staff expenses is devoted to the
development of new products and, in particular, the development and migration of Viadeo's new
technological platform, the organisation and reinforcement of the mobile team and the ramp up of
technical and sales teams, especially in China.
The strengthening of teams, notably through the recruitment of highly specialised profiles (certain
engineers, for example), may have a significant impact on staff expenses.
Marketing expenses
The Group's business model is based on the networking concept: by completing and updating their
profiles, Viadeo members add to the website's database, which in turn draws new professionals into
the network. Each member seeks to connect with his/her professional contacts, thereby contributing to
the recruitment of non-members. Accordingly, the membership base grows "virally" and requires very
low acquisition costs (marketing costs).
120
a) Marketing expenses
Marketing expenses are mainly incurred through public relations activity and participation in trade
fairs, conventions or exhibitions, which may in certain cases be exchanged for Viadeo or Tianji
products. Despite a strong increase in this type of expense in 2013, a more moderate increase may be
expected in the future.
However, the launch of new products and the development of business activities in China could incur
very targeted and significant one-off marketing expenses.
b) Exchanges
Accordingly, the Group offers premium subscriptions and promotional campaigns in exchange for
visibility campaigns published in its partners' media to promote Viadeo's brand image. Although its
growth model is based on virality and the network effect, the Group decided to implement certain
campaigns to promote the launch of new products and partnerships (Orange, CCI, etc.), and to support
growth in certain regions.
Other external expenses comprise mainly the following items:
 Operating costs of subsidiaries, including office space and the Group's headquarters;
 Group employee assignment expenses;
 Compensation for intermediaries and payment of sub-contractor fees and expenses, together
with a portion of the compensation for executives, invoiced through service contracts; and
 Technical expenses (bandwidth, server hosting, etc.).
Other external expenses are mainly fixed costs which are not likely to see a significant increase
associated with growth in revenue in years to come.
Other expenses and operating income
Other expenses and operating income are related in particular to the recognition research tax credits
and gains or losses arising from disposals.
Share-based payments
These expenses are related to the valuation of the IFRS 2 charge for loyalty-building tools attributed to
employees, such as the founder's warrants (BSPCE). Changes in these expenses depend in particular
on the Group's policy in terms of granting such instruments.
Depreciation, amortisation and provisions
Depreciation and amortisation expenses are influenced in particular by the level of investments made
in technological platforms and, to a lesser extent, by investments made in server-type IT equipment.
Provisions may vary in particular according to future risks faced by the Group.
121
9.1.3
Segment reporting
The Group identifies and presents operating segments based on the information provided internally to
the main operating decision-makers.
An operating segment is a component of the Group that operates business activities from which it may
earn income and incur expenses, including income and expenses related to transactions with other
components of the Group. Each segment represents a Cash Generating Unit ("CGU"). The EBITDA
per segment is regularly reviewed by General Management to make decisions regarding the resources
to be allocated to the segment and to assess its performance. This information, on business activities
related to the Viadeo and Tianji segments, is then analysed in accordance with the various service
categories (subscriptions, recruitment and training and marketing and advertising).It should be noted
that the Group does not break down the analysis by service category to a more detailed level than
revenues.
The Group's base costs are covered in full by the Viadeo CGU. At the current stage of the Group's
development, management does not consider it useful to allocate these costs by CGU. Accordingly,
there is no management fee agreement between Viadeo and Tianji, and no distribution of these costs in
the internal reporting.
9.1.4
Changes to the scope of consolidation
During the financial period presented, no significant changes in the scope of consolidation have
disrupted the comparability of the accounts or required pro forma figures to be established. The only
changes concern the dissolution in 2013 of four subsidiaries with no material business activities.
9.1.5
Presentation of financial and accounting information and aggregates
To assess its business performance, the Group chose the following indicators: Operating margin and
adjusted Operating margin hereinafter referred to as “EBITDA” and "Adjusted EBITDA" respectively,
defined and calculated as described below in points a) and b).
The EBITDA and Adjusted EBITDA are not standardised accounting aggregates meeting a single
generally accepted definition. They should not be considered as a substitute for operating income, net
income or cash flow, or even as a measure of liquidity. Other issuers could calculate the EBITDA and
Adjusted EBITDA in a way that does not match the Group's definition.
a) EBITDA
EBITDA is the indicator used by Management to assess the performance of each operating segment.
It represents the operating resources generated by the company's recurring business activities in each
segment.
Calculated by the difference between revenue and expenses from recurring business activities, it
comprises:
- Income from operating activities: online subscriptions, marketing and advertising services,
recruitment and training services, and other income (including barter transactions);
122
-
Expenses from operating activities: staff expenses, marketing expenses, other external
expenses and other recurring operating income and expenses (gains or losses on asset
disposals, subsidies and Research Tax Credits).
The EBITDA is calculated every month by operating segment, and is included in the monthly
reporting distributed to management.
b) Adjusted information
Considering the material expenses related to the technological platform migration and the operating
costs of closed entities, which had a significant impact on income in 2013, the Company also presents
accounting data adjusted for these expenses.
Adjusted EBITDA is defined as the difference between:
- EBITDA as defined above; and
- the material expenses related to the technological platform migration and operating costs of
the audited entities.
In the comments below, all aggregates described as "adjusted" must be understood to be adjusted for
the technological Viadeo platform migration expenses and the operating costs of closed entities.
9.1.6
Estimates and assumptions used in preparing the financial statements
To prepare financial statements in accordance with IFRS, estimates, judgments and assumptions were
made by the Group General Management; they could have affected the reported amounts of assets and
liabilities, contingent liabilities at the date of preparing the financial statements, and the reported
amounts of income and expenses for the fiscal year.
These estimates are based on the assumption of going concern and were prepared in accordance with
the information available at the time of their preparation. They are assessed continuously based on past
experience and various other factors deemed to be reasonable, which represent the basis for assessing
the carrying amount of assets and liabilities.
The estimates may be revised if the circumstances on which they are based change or if new
information arises. Actual results may differ significantly from these estimates based on assumptions
or different conditions.
The main estimates and assumptions used concern the assessment of the following items:





The amortisation period for intangible assets regarding capitalised research and development
projects;
Equity-settled share based payment transactions;
Goodwill;
Deferred taxes, in particular deferred tax assets relating to losses carried forward;
Assessment of provisions.
123
a) Intangible assets related to capitalised research and development projects
Intangible assets in progress concern expenses for the development of professional network platforms
which had not been put into service at the closing of the fiscal year. These intangible assets in progress
are not amortised until they are put into service.
In 2013, the criteria for capitalising development costs associated with the Tianji platform have been
met, in particular the criterion of future economic benefits. Accordingly, the Group capitalised
€1,314K.
During the same fiscal year, investments related to the new Viadeo platform amounted to nearly
€2,981K. The migration of services to the new platform continues in 2014.
The modules developed internally for the Viadeo and Tianji platforms are amortised on a straight-line
basis over three years from their in-service date.
b) Share-based payments
Since its creation, the Group has implemented several compensation plans settled in equity
instruments in the form of Warrants (BSA) and Founder's warrants (BSPCE) attributed to employees,
executives and members of the board of directors.
Pursuant to the IFRS 2 standard, the cost of transactions settled in equity instruments is expensed on
the period during which the rights to benefit from equity instruments are acquired, against an increase
in shareholders' equity.
The fair value of the stock options granted to employees is determined by applying the Black-Scholes
option pricing model.
The benefit measured in accordance with IFRS 2 represents beneficiaries' compensation: it is
recognised as "Share-based payments reserved to employees" within the recurring operating income.
This expense amounted to €798K in 2012 and €972K in 2013.
c) Goodwill
Goodwill is measured as the difference between the aggregate of (i) the value of the consideration
transferred, (ii) the amount of any non-controlling interest in the acquiree, and (iii) the acquisition-date
fair value of the acquirer's previously-held equity interest in the acquiree (if applicable), and the net of
the acquisition-date amounts of the identifiable assets acquired and the liabilities assumed.
The Group's accounts show goodwill of €5,360K (gross amount) at the end of 2012 and €5,219K at
the end of 2013. This goodwill is allocated by segment as follows:
-
€2,932K for Viadeo
€2,287K for Tianji
The goodwill is not amortised, but is subject to an annual impairment test. The principles applied by
the company are described in Note 3 of the appendix to the consolidated financial statements.
124
As at 31 December 2013, the analyses conducted showed that there is no risk of an impairment loss.
Moreover, no goodwill impairment was recorded in the consolidated financial statements.
The simulation exercise performed for the CGU carrying amount impairment tests did not reveal any
material risks related to the impairment of goodwill, even assuming a zero average growth rate over
the business plan period for the Viadeo CGU and halved for the Tianji CGU.
9.2 COMMENTS ON THE CONSOLIDATED INCOME STATEMENTS FOR
FISCAL YEARS ENDED 31 DECEMBER 2013 and 2012
9.2.1
Group revenue
The Group's total revenues from operating activities amounted to €30,917K in 2013 and €27,733K in
2012, up 11.5%.
9.2.1.1 Analysis of revenue growth by type
Overall growth in revenues from operating activities amounted to 11.5% between 2013 and 2012.
2013
2012
Change
15,793
15,938
-0.9%
8,812
7,537
16.9%
Revenues
4,958
3,916
26.6%
29,563
27,391
7.9%
Other income
1,355
342
30,917
27,733
11.5%
It is broken down according to the following product lines:
Online subscriptions, which historically funded the company's growth, represented 51.1% of total
revenues from operating activities in 2013. This line of revenue was almost unchanged in 2013 (0.9%), primarily due to the popularity of mobile usages and the development of new versions of
applications for mobile devices and tablets in 2013, which now offer the possibility of taking out
premium subscriptions. Before November 2013, the Group had decided to foster growth in its mobile
applications, which represent a significant driver of growth in the future, at the expense of immediate
revenues. For example, members who had not taken out a premium subscription could perform certain
actions on their mobile phones or tablets, which could not be carried out on the website without having
a premium subscription. Since the fourth quarter of 2013, mobile applications include integrated
subscription systems. To date, online subscriptions concern only the Viadeo platform and mainly
France (more than 90% of subscriptions).
125
Recruitment and training services recorded growth of +17% in 2013, due to the Group's increased
business presence and the strong recruitment of new customers. These services represented 28.5% of
total revenues from operating activities in 2013. The transfer of other recruitment methods in favour of
social recruitment services, like those offered by its own services, enabled Viadeo to increase its
income for this line of revenue. This growth was also driven by the successful launch of new products
dedicated to the employment sector, in particular the "Job & Career" tab of the "Company pages"
product and mail targeting products (Viadeo Mail), making it possible to send job offers to the
members selected by recruiters.
Marketing and advertising services experienced growth of +27% in 2013 and represented 16.0% of
total revenues from operating activities in 2013. The increased membership base, combined with the
implementation of new standard formats (IAB) increased the available inventory. These services are
predominantly marketed via advertising agencies. The strengthening of relations with these agencies
made it possible to enhance Viadeo prescriptions in global media plans. Furthermore, the key features
of the Viadeo offer (targeting) have become more attractive to advertisers.
The other income mainly comprises the barter transactions as part of marketing operations helping to
enhance the Group's visibility.
9.2.1.2
Analysis of revenue growth by region
The Group has business operations primarily in the following regions: France (where the headquarters
is located), China, Russia and Africa.
The following table presents revenue from operating activities generated from external customers of
the Group, based on their geographical location.
2013
2012
Change
29,374
26,692
8.2
10.1%
China
841
302
8.3
178.5%
Russia
268
314
8.4
-14.6%
45
37
8.5
21.6%
390
387
30,917
27,733
8.6
0.8%
8.7
11.5%
France
Africa (Morocco)
Other
Revenue from operating activities
To better understand the analysis of the geographical breakdown of revenue, it should be noted that
revenues from online subscriptions, which account for 51.1% of the Group's revenues from operating
activities, are generated primarily in France. The Group decided to foster membership growth by
keeping all paying features in France free of charge in several regions (China, Russia, etc.). Although
the service is a paid one in several countries, revenue generated outside of France represents only a
small share of the Group's revenues (mainly European countries). Moreover, a free online subscription
option has been offered in West Africa since 2013, on the condition that Internet users perform a few
actions on the website. Although this option has a negative impact on the Group's revenue in the
region, it accelerates data collection, enabling the monetisation of lines of revenue for recruitment and
training services and online marketing and advertising services.
Accordingly, given the Group's trade stage of development and established reputation in the country,
France accounted for 95% of the Group's revenues in 2013.
126
China accounted for only 3% of revenues in 2013, but saw strong revenue growth (178.5%) in 2013.
This growth - mainly related to recruitment and training services and marketing and advertising
services - was achieved through the strengthening of sales teams in 2012 and 2013 and an improved
product offer on advertising revenues, notably by providing new advertising formats better suited to
the Chinese market's expectations.
Income in Russia was generated exclusively from the sale of marketing and advertising services. The
14.6% decrease in revenue between 2012 and 2013 is related to very weak economic conditions
locally, in particular at the end of fiscal year 2013. Accordingly, management focused as a priority on
membership acquisition, which would make it possible to reach critical size quickly and to accelerate
the commercialisation of services in 2014.
9.2.2
Operating income
The Group identifies two business segments (refer to paragraph 9.1.6 above).The Viadeo segment
includes income and expenses generated across all the Group's markets, excluding China, which is a
CGU in its own right.
Following a strategic review of its geographical positioning, the Group dissolved certain subsidiaries
of the Viadeo segment to focus on its resources in the France, China, Russia and Africa regions.
Accordingly, the core business activity of the Viadeo segment incurred several expenses in 2012 and
2013, related to:
the Group's business activities outside of France and China, and in particular the
activities of subsidiaries dissolved in 2013 or which are currently being dissolved (Senegal,
Italy, Spain, Mexico, India and the Netherlands);
development costs for the technological platform accessible from all markets in the
segment, excluding China, which has its own platform generating flows recognised in the
Tianji segment;
central costs due to its Group structure supported by the Viadeo segment on behalf of
the entire Group, but which the Group is currently unable to reallocate to the different regions
in the absence of a Management fees agreement and relevant allocation key.
9.2.2.1
Segment-based analysis of the EBITDA
The EBITDA generated by the Group decreased significantly over the period presented, from
€(3,655K) to €(8,261K). The table below breaks down EBITDA and Adjusted EBITDA by platform.
127
Consolidated
(en K€)
VIADEO
2013
TIANJI
2012
2013
2012
2013
GROUP TOTAL
2012
2013
2012
15,793
15,937
0
1
15,793
15,938
8,444
7,350
368
187
8,812
7,537
4,485
3,796
473
120
4,958
3,916
Other income
1,355
348
361
646
(361)
(652)
1,355
342
30,076
27,430
1.201
954
(361)
(652)
30,917
27,733
(19,729)
(16,821)
(3,444)
(2,578)
(23,174)
(19,399)
(3,649)
(1,992)
(1,764)
(1,097)
(5,413)
(3,089)
(9,571)
(8,870)
(1,860)
(1,319)
423
(11,009)
(9,537)
479
645
-
(8)
(61)
418
637
(2,395)
393
(5,866)
(4,048)
-
-
(8,261)
(3,655)
1,127
709
(5,866)
(4,048)
-
-
(4,739)
(3,339)
Staff expenses
Other current expenses and operting income
EBITDA
Adjusted EBITDA(1)
652
(1) After deduction of expenses related to the technological platform migration and operating costs of the closed entities.
Inter-segment transactions reflect the intra-group transactions carried out between the Viadeo and
Tianji segments and are removed in the consolidated financial statements.
Viadeo segment
Revenues from operating activities: total revenue grew by 9.6% between 2012 and 2013, affected by
the stability of revenue from online subscriptions. This stability is explained by the sharp increase in
visits to the Viadeo.com website via mobile and tablet applications, which offer free access to all the
site's features, together with slow service due to the migration of the website's features from the old to
the new platform.
Recruitment and training services went up by 14.9% between 2012 and 2013, reflecting in particular
marketing efforts to promote subscriptions to "Profile libraries" among traditional customers and the
Group's strengthened presence in France's regions. The sale of marketing and advertising services also
saw a significant increase (+18,1%) in 2013, thereby demonstrating growing interest from advertisers
in targeted and highly skilled advertising.
Lastly, Other income, which represents the exchange of services for external marketing expenses,
recorded strong growth. In the case in point, these exchanges made it possible to purchase marketing
and branding services without having to pay these amounts in cash.
EBITDA: EBITDA generated by the Viadeo segment dropped significantly between 2012 and 2013,
from €393K to €(2,395K).
The main causes for the change affecting the EBITDA are:

Increased staff expenses (€2,908K; up by 17%), due in particular to the growing workforce
(up by more than 7%), which increased from 276 to 296 between 2012 and the end of 2013.
These new recruitments concerned in particular highly skilled employees for the development
of the new Viadeo platform in a “Big Data” technological environment, together with the
organisation and strengthening of the mobile team. Although this growth is significant, it is
weaker than that of the Group's total payroll, which amounted to 19% between 2012 and 2013,
given that the Tianji segment had benefited from an even greater increase in its workforce.
128

External marketing expenses up by 83.2%, amounting to €3,649K at the end of 2013. This
increase in marketing costs, a substantial portion of which is paid in exchanged services
(+37%), arises from campaigns to launch new products and partnerships, the support for
mobile service development through promotional and advertising campaigns for the Group's
mobile applications (web purchases, press promotions, etc.), and events aimed at promoting
the brand.

Other external expenses, up by only 7.9% despite expenses incurred for the rental of
additional office space in 2013, which led to a one-off increase of €336K. The development of
the new platform required the services of specialised subcontractors, which led to expenses of
€533K in 2013 and €129K in 2012.
In particular, these expenses include those related to the technological platform migration and
operating costs of the closed entities, which weighed on the EBITDA of the Viadeo segment in 2013.
 Development costs related to the new technological platform
Historically, the Viadeo platform was developed on technologies that are no longer state-of-the-art
(OpenSource MySQL database, Java programming in a Linux environment). At the end of 2012, it
became clear that this initial platform would not be able to withstand the increased membership base
or the growing number of interactions between contacts.
In accordance with one of the goals of the fund-raising carried out in 2012, the Group started to
develop a new platform based on the most cutting-edge technologies (NOSQL and HADOOP). The
feasibility study began at the end of 2012 and the developments were completed in 2013. The
migration of the main features to this new platform began in September 2013 and should be completed
at the end of 2014.
The total investment dedicated to this new platform amounted to €2,981K in 2013, of which €2,080K
was expended and €901K was capitalised over the year, whereas it only amounted to €316K in 2012.
 Operating costs for closed entities
In 2013, a strategic reassessment of the Group's geographical positioning was carried out based on the
subsidiaries, leading to the dissolution of six entities. Four of them were dissolved in 2013 (Senegal,
Italy, Spain and Mexico), whereas ApnaCircle, the Indian subsidiary, is currently being dissolved and
Soocial, the Dutch subsidiary, has ceased its business activities. Despite the fact that these six entities
have ceased their business activities, the remaining expenses were recorded in the 2013 financial
statements. Accordingly, the recurring expenses of these subsidiaries (dissolved or in the process of
dissolution) are still recorded within the current operating income, just like the expenses of active
subsidiaries. The impact of dissolved subsidiaries or subsidiaries which have ceased their business
activities on the EBITDA is €1,442K. Furthermore, provisions for the costs of closing these
subsidiaries affected the non-current operating income in the amount of €92K in 2012 and €257K in
2013.
Whereas the EBITDA for the Viadeo segment amounted to €(2,395K) in 2013, compared with €393K
in 2012, excluding expenses related to the technological migration of the platform and the operating
129
costs of closed entities, the Adjusted EBITDA for the Viadeo segment amounted to €1,127K in 2013,
compared with €709K in 2012.
Lastly, it is reminded that the Group's central costs62 are supported in full by the Viadeo segment,
without a proportional share-out with the Tianji segment.
As an indication, in 2013 these costs amounted to €2,928K.
TIANJI platform
Revenues from operating activities: total revenue was up by 26% between 2012 and 2013, taking
into account inter-segment transactions which increased the platform's income by €652K in 2012 and
€362K in 2013. Excluding these intra-group transactions, revenue growth amounted to 178%.
The first sales achievements confirmed the marketing and advertising services offer and helped
position the recruitment and training services offer. Recruitment and training services have nearly
doubled, representing 31% of the Tianji segment's revenue with revenues of €368K in 2013.
Marketing and advertising services have nearly quadrupled, representing 39% of the Tianji segment's
revenue with revenues of €473K in 2013.
EBITDA: By raising funds of more than €22.3 million (net of issuing costs) in April 2012, the Group
was able to speed up the development of its activities in China. Accordingly, Tianji could form a sales
team and invest in its technical infrastructure. These expenses took EBITDA from €(4,048K) in 2012
to €(5,866K) in 2013. This €1,818K decline can be broken down as follows:

Staff expenses up by €866K due to an increased platform workforce (from 114 employees at
the end of 2012 to 151 employees at the end of 2013; i.e. an increase of 34%). The
strengthening of the teams was especially beneficial to sales teams and to the ramp up of
technical teams;

External marketing expenses up by a substantial €667K (i.e. 60.8%), amounting to €1,764K in
2013. These expenses are related to the launch of new products and partnerships, the support
for the development of mobile services, and events aimed at promoting the brand;

Other external expenses up from €1,319K to €1,860K due to the rental of new office space.
As for technological development, €1,314K was capitalised in 2013, whereas all the criteria for
capitalisation had not been met in 2012.
In total, the Group's EBITDA amounted to €(8,261K) in 2013, compared with €(3,655K) in 2012.
Excluding the expenses related to the Viadeo technological platform migration and operating costs of
the closed entities, the Group's adjusted gross operating margin amounted to €(4,739K) in 2013,
compared with €(3,339K) in 2012.
62
The Group estimates that the base costs are those costs inherent to the existence of two segments. These central
costs include salaries, transport and telephony expenses for one senior manager and three managers in the
Finance Department and relating to the entire Strategy Department and the Chief Information Officer’s office.
They also include fees in connection with the operating of the Group (including areas related to Consolidation
and Tax).
130
9.2.2.2 Current operating income63
Current operating loss increased by €6,114K over the period presented (from €8,310K in 2012 to
€14,424K in 2013). In addition to the Group's EBITDA being down by €4,606K, the increase in the
recurring operating loss is due mainly to the following:

a significant increase in depreciation, amortisation and provisions. These expenses rose
steeply in the period presented, going from €3,756K to €5,284K.
This increase of €1,528K is due in particular to:
o
a €860K rise in operating provisions, comprised mainly of €396K of provisions for
premises not operated and €499K connected to provisions for disputes involving
employees,
o
a €461K increase in amortisation charges for intangible assets due to the capitalisation
of €1,973K in development costs for platforms put into service (including €1,314K for
the Tianji platform), compared with the capitalisation of platforms put into service
amounting to €256K in 2012,
o
a €219K increase in depreciation of property, plant and equipment;
And, to a lesser extent:

an increase in the IFRS 2 charge related to share-based payments which increased by €174K
(i.e. 21.8%), amounting to €972K.
After taking these items into account, current operating income stood at a loss of €14,424K in 2013,
compared with a loss of €8,310K in 2012.
Excluding the platform's technological migration expenses and the operating costs of the closed
entities affecting the Viadeo segment in 2013, the adjusted recurring operating income would
represent a loss of €10,902K in 2013, compared with a loss of €7,994K in 2012.
9.2.2.3 Non-current operating income64
It was decided to isolate all the expenses and provisions related to the closure of the subsidiaries
which had been dissolved or which had ceased their business activities in 2012 and 2013, and to
record them under non-current operating income. These expenses amounted to €92K and €257K
respectively for 2012 and 2013.
No additional costs are planned for 2014, since the majority of the subsidiaries' closure expenses were
borne and provisioned in 2012 and 2013.
63
"Current operating income" represents the difference between income and expenses before tax, with the exception of those
resulting from financing activities, associate companies and discontinued operations, and prior to the impact of "Non-Current
operating income"
64 "Non Current operating income” refers to income and expenses resulting from a major event that occurred during the
accounting period and are such that they could distort the interpretation of the Group’s performance. This therefore concerns
a limited number of items of income and expenses that are both unusual and infrequent.
131
9.2.3
Group net income
Financial income
The financial income for the period presented is broken down as follows:
Revenues from financial assets (excl. cash
equivalents)
Foreign exchange gains
Other financial income
Financial income
Interest costs on borrowings
Foreign exchange losses
Other financial costs
Discounting effects
Financial costs
2013
2012
59
148
3
210
(39)
(374)
(14)
(11)
(439)
130
138
1
269
(79)
(326)
(4)
(75)
(484)
(229)
(216)
The main component is the foreign exchange loss due to the Group's international business. See
Chapter 4.7.3 "Currency risk".
To a lesser extent, the financial income (excluding foreign exchange gains) is mainly related to shortterm cash investments coming from funds raised in April 2012; this amount has decreased according
to its consumption by the Group's operating and investment activities. Excluding foreign exchange
losses, the financial costs are mainly related to a bank loan.
Income tax
The Group generated tax income of €1,624K in 2013 and €3,974K in 2012 due to the recognition of a
deferred tax asset mainly resulting from APVO tax losses. The amount of tax assets corresponds to tax
losses carried-forward which are likely to be used over the next three years, as provided in the Group's
fiscal planning.
This tax income is broken down as follows:
Current tax
Deferred tax
Income tax
2013
(299)
1,924
1,624
2012
(253)
4,227
3,974
It is reminded that the Group has the following tax benefits as at 31 December 2013:
65
€8,605K in tax losses to be carried forward indefinitely in France;
US$9,760K (ie€7,102K)65 carried forward for 20 years in the US;
CNY105,749K (€12,710K)66 carried forward for five years in the People's Republic of China.
On the basis of exchange rates at 31 December 2013
132
At 31 December 2013, deferred tax assets recognised in the consolidated balance sheet (€5,460K)
concern:
-
primarily, deferred tax assets on tax loss carry-forwards for the American entity APVO
amounting to €5,337K (profitability being expected from the year 2014);
more marginally, deferred tax assets on timing differences for the Russian entity Viadeo IM
LLC amounting to €123K.
Net Income for the fiscal year
After tax, consolidated net income represents a loss of €13,121K in 2013, compared with a loss of
€4,809K in 2012. In the absence of non-controlling interests, the net loss attributable to Group
shareholders was equal to the overall net loss.
Excluding the platform's technological migration expenses and the operating costs (excluding tax
effect) of the closed entities affecting the Viadeo segment in 2013, the Group's adjusted consolidated
net income would amount to a loss of €9,507K in 2013, compared with a loss of €4,236K in 2012.
Earnings per share (diluted and non-diluted basis)
Given that this amount represents a loss, the earnings per share issued (weighted average number of
shares outstanding) on a diluted or non-diluted basis are identical and amounted to €(41.61) in 2013
and €(16.12) in 2012.
These figures do not take into account the 25-for-1 stock split approved by the general shareholders'
meeting on 21May 2014. After taking into account this stock split, the net loss per share amounted to
€(1.664) in 2013 and €(0.064) in 2012.
9.3 SIGNIFICANT FACTORS, INCLUDING UNUSUAL OR INFREQUENT EVENTS
OR NEW DEVELOPMENTS, MATERIALLY AFFECTING THE ISSUER'S
INCOME FROM OPERATIONS, INDICATING THE EXTENT TO WHICH IT IS
AFFECTED.
See the introductory paragraph at 9.2.2.
9.4 MEASURE OR ANY FACTOR OF AN ADMINISTRATIVE, ECONOMIC,
BUDGETARY, MONETARY OR POLITICAL NATURE HAVING HAD A
MATERIAL IMPACT OR ABLE TO HAVE A MATERIAL IMPACT, WHETHER
DIRECT OR INDIRECT, ON THE ISSUER'S OPERATIONS.
See Chapter 4 "Risk factors" and more specifically paragraphs 4.3.7, 4.4.2, 4.7.8 and 4.7.9.
133
10 LIQUIDITY AND CAPITAL RESOURCES
10.1
INFORMATION CONCERNING THE
LIQUIDITY AND SOURCES OF FUNDING
10.1.1
GROUP'S
CAPITAL,
Information concerning cash and cash equivalents
Given that the Group's operating activities does not generate positive cash flow at this stage of its
development, the Group's available cash to finance its operations and capital expenditures comes only
from external funds. Surplus cash is regularly invested in money market instruments.
10.1.2
Information on the Group's sources of funding
Since its creation, the Group has had the following main sources of funding:








successive capital increases in cash (excluding the exercise of warrants) representing total
gross fund raising of €38,016K, with the last increase carried out in April 2012 for a gross
amount of €24,248K (before charging expenses against issue premium);
a bond issuance in connection with the acquisition of Soocial for €1,584K (fully repaid at the
end of 2012);
three convertible bond issues subscribed in January, February and May 2014, for a total
amount of €10,550K, (whose final tranche of €5,000K is still being paid up at the date of this
document de base), bearing interest at 9% per annum of which 4% is capitalized and intended
to be converted into shares at the time of the IPO (see section 21.1.4.2 of this document de
base for details), and to a lesser extent,
the repayment of Research Tax Credits representing a total amount of €1,706K;
two bank loans for a total nominal amount of €615K. The first was taken out in 2010 and the
second in 2012 by the subsidiary Soocial;
an OSEO repayable advance of €490K granted in 2009; and
COFACE advances (insurance-prospecting) of €730K in total, granted in May 2009 and May
2011, and lastly;
the use of factoring.
10.2
CASH FLOW
Net annual cash flow over the period presented saw significant changes from one year to the other.
Whereas 2012 showed positive net cash flow of €14,876K due to funds raised in April, 2013 ended
with net cash outflow of €(13,581K) for operating activities and expenditures aimed at the overhaul
and development of the Viadeo and Tianji platforms.
2013
2012
Net cash flow from operating activities
(8,817)
(963)
(6,325)
(3,675)
1,561
19,513
(13,581)
14,876
4,593
18,269
Net cash flow from financing operations
Net change in cash and cash equivalents
Cash and cash equivalents at the end of the year
134
10.2.1 Cash flow from operating activities
Operating activities resulted in a net cash outflow (of €(963K) in 2012 and €(8,817K) in 2013). This
very significant change derived from decreased cash flow from continuing operations, combined with
stable working capital in 2013, against a positive effect of €3,085 in 2012.
2013
2012
Net income for the period
Of which net income from discontinued operations
(13,121)
(4,809)
Of which net income from continuing operations
(13,121)
(4,809)
5,035
4,007
304
177
972
798
Adjustments for:
- Depreciation, amortisation and provisions (excluding those related to
current assets)
- Elimination of proceeds on disposal of assets and dilution gains and losses
- Income and expenses related to share-based payments
- Actuarial gains and losses
11
75
- Gains and losses related to fair value
-
-
- Share in net income + impairment of investments in associated companies
-
-
- Other income and expenses with no cash impact
-
(20)
(6,798)
227
38
(47)
- Income tax expense (including deferred tax)
(1,624)
(3,975)
Cash flow from continuing operations after net financial income and
tax
(8,384)
(3,794)
(244)
(188)
(253)
3,085
(8,817)
(963)
(8,817)
(963)
Cash flow from continuing operations before net financial income and
tax
- Cost of net financial debt
- Tax paid
- Change in working capital
Net operating cash flow from continuing operations
Net operating cash flow used by discontinued operations
NET CASH FLOW FROM OPERATINGACTIVITIES
Cash flow from continuing operations before net financial income and tax
The amount of cash flow from continuing operations before net financial income and tax generated
during the period presented is down by nearly €4,590K, from €(3,794K) to €(8,384K). This significant
decline is mainly due to:
Increased net loss, which went from €(4,809K) in 2012 to €(13,121K) in 2013, taking into account:
- special efforts made by the Group in terms of commercial deployment and evolution of
technological platforms, as described in section 9.2.2 above; and
- a drop in income tax benefit from €3,975K to €1,624K;
which was partially offset by an increase in non-cash deductible expenses, including an increase of
25.7% in depreciation, amortisation and provisions, which went from €4,007K in 2012 to €5,035K
(see section 9.2.2.2 of this document de base) and the IFRS 2 charge for share-based payments.
Change in working capital
The change in the Company's working capital had a positive impact of €3,085K in 2012 on the
operating cash flow and a negative impact of €188K in 2013.
135
In 2012, the net change in working capital was notably due to the increase in trade receivables on the
one hand, and trade payables and deferred income on the other hand, compared with the same period
in 2011, but in very different proportions. Whereas sources(trade receivables, other receivables and
current tax receivables) only increased by €1,573K in total, resources showed a much higher increase,
i.e. €4,169K, under the combined effect of trade payables and other payables (up by €2,195K) and
deferred income corresponding to deferred revenues from online subscriptions (€1,974K).
In 2013, however, operating sources remained relatively stable under the cross effect of a €924K
increase in trade and other payables and a €1,201K decrease in deferred income resulting from a
change in the products mix, with mainly short-term subscriptions at the end of the year.
At the same time, the €366K increase in trade and other receivables was more than offset by the
€671K decrease in current tax receivables following a regulatory change to the Research Tax Credit
(CIR) in 2012. From 2013, the Company no longer benefits from the regime which allowed the
repayment of the Research Tax Credit in the year following its recognition, but from a repayment after
three years as long as the tax credit is not offset against current income tax within that period.
Accordingly, the €783K receivable recorded in 2013 was classified as a non-current asset given the
Group's loss-making position.
10.2.2 Cash flow from investing activities
In thousands of euros
2013
Acquisition of property, plant and equipment
Acquisition of intangible assets
Acquisition of financial assets
Proceeds from disposals of property, plant and equipment and intangible
assets
Disposal of or reduction in financial assets
Impact of changes in the scope of consolidation
Net cash flow from investing activities for continuing operations
2012
(875)
(5,126)
(337)
(1,257)
(2,882)
(153)
3
430
21
188
(11)
-
(6,325)
(3,675)
(6,325)
(3,675)
Net cash flow from / (used by) investing activities for discontinued
operations
II - NET CASH FLOW FROM INVESTING ACTIVITIES
The main investment concerns intangible assets which mainly consist of capitalised development
costs. These costs relate to the creation of new functionalities and the technical development of the
Viadeo and Tianji platforms. These technical developments are aimed at having the technological
capacity to deal with the website's significant expansion, due to increased traffic and usages:
In 2012, the €2,882K was broken down as follows:
- €2,596K capitalised with respect to developments in progress on the web platform and mobile
and tablet applications for the Viadeo segment;
- €256K in platform capital expenditure; and
- €30K in software.
In 2013, €5,105K (out of a total amount of €5,126K)related to capitalised development
expenses, including €3,132K for assets not yet in service (thereby recorded under assets in
progress), and €21K related to software purchases. The capitalised amounts for Tianji platform
developments came to €1,314K. Out of the total amount related to the Viadeo segment, €901K
concerned the new platform.
136
Investments in property, plant and equipment relate mainly to the purchase of servers (purchases
representing €1,177K in 2012 and €514K in 2013) enabling the Group to store and process data.
Other non-current financial assets consist mainly of guarantee deposits, namely €138K in 2012,
related mainly to the change in the guarantee deposit paid to GE Factobail, and €329K in 2013, of
which €119K is due to the new lease for the building located at 65 rue de la Victoire.
10.2.3 Cash flow from financing activities
Over the period presented, net cash flow from financing activities fluctuated significantly, going from
€19,513K in 2012 to €1,561K in 2013, greatly impacted by the funds raised in April 2012,
representing gross proceeds of €24,248K.
2013
2012
Capital increase
41
22,370
New borrowings
2,132
573
Loan repayment (including finance lease agreements)
(574)
(3,340)
Net financial interest paid (including finance leases)
(39)
(91)
Net cash flow from financing activities for continuing operations
1,561
19,513
Net cash flow from / (used by) financing activities for discontinued
operations
III - NET CASH FLOW FROM FINANCING ACTIVITIES
1,561
19,513
Purchase/disposal of treasury shares
Distribution of dividends
The main components of these cash flows from financing activities are as follows:
Capital increases:


In 2012, net cash flow of €22,370K was generated following the funds raised in April 2012,
representing a gross amount of €24,248K (before charging expenses against issue premium)
and following the exercise of founder's warrants (BSPCE) representing a subscription amount
of €105K;
In 2013, the only impact on share capital was connected to the exercise of founder's warrants
(BSPCE) and warrants (BSA).
Debt:
In 2012, debt movements resulted from:
 An increase of €574K resulting mainly from the collection of €265K for the COFACE
advance and €308K for the financing of servers;
 A decrease of €3,340K mainly due to a €1,821K drop in the factor debt reflecting lower
collection of factored receivables, the repayment of €1,187K of the repayable bond issued in
2011 upon the acquisition of Soocial and, to a lesser extent, the repayment of €120K for the
OSEO repayable advance and bank loans amounting to €191K.
In 2013, debt movements consisted of:
 An increase of €2,132K, including €2,000K in factor debt and €132K for the Coface advance
received;
 Repayments totalling €574K, including €140K related to the OSEO repayable advance, the
remaining amount mainly consisting of the repayment of bank debts.
137
10.3 RESTRICTIONS ON THE USE OF CAPITAL RESOURCES
With the exception of the €452K in securities pledged to guarantee the proper execution of the new
lease signed in the first quarter of 2013 (and recorded as non-current financial assets), the Group is
subject to no restrictions on the use of its capital resources.
10.4 SOURCES OF FUNDS REQUIRED IN THE FUTURE
See section 4.7.2 "Liquidity risk - future needs for additional capital and funding".
138
11 INTELLECTUAL PROPERTY
11.1 INTELLECTUAL PROPERTY POLICY
A substantial part of the Group's assets and rights lies in the trademarks, domain names, software,
databases and other intellectual property rights it owns. The Group's intellectual property policy is
focused on the protection of its trademarks, domain names, software and databases.
With respect to trademarks and domain names, the Group generally registers them in the countries in
which the domain name or trademark is to be used. Where it is expected that the trademarks or domain
names in question will be used in other territories, filings abroad may be performed.
As regards software, the Group's goal is to develop proprietary software solutions drawing on open
source solutions that are highly personalised in order to provide the services expected by its members.
The Group also endeavours to regularly upgrade the functionalities offered. Since its inception, the
Group has formed a team of engineers and technicians that has gradually expanded and, as of the date
on which this document de base was filed, comprises around 103 IT developers located in the United
States, France and China.
Moreover, the Group places particular importance on making the necessary contractual arrangements
to ensure the protection of its trade secrets and its know-how with respect to its employees and the
service providers (such as hosts or developers) it may use.
11.2 ELEMENTS OF INTELLECTUAL PROPERTY
Given the nature of its business, the Group pays close attention to the protection of the four elements
of intellectual property that are: trademarks, domain names, software and databases. With respect to
both the Viadeo and Tianji platforms, the intellectual property aspects are managed exclusively by the
Group, without having recourse to consultants specialized in this area.
At present, the intellectual property owned by the Group consists of the trademarks, domain names,
software and databases detailed below.
11.2.1 Trademarks
The Group's filing strategy consists of proceeding to the registration of its trademarks at national, EU
or international level, depending on the case. Trademark registrations are usually granted for a period
of ten years and can be renewed indefinitely. Some countries require proof of use in order to maintain
the rights. In other countries, registrations remain valid unless a third party with an interest therein
initiates a cancellation action for lack of use.
139
The list of trademarks and trademark applications owned by the Group appears in the tables below:
Trademark
Filing / registration
date
Registration
no.
Countries covered
Renewal
(year)
Viadeo
30/11/2006
09/01/2007
3466437
5603659
France
European Union
2016
2017
Viadeo
03/01/2007
09/01/2007
5595293
3473570
European Union
France
2017
2017
05/08/2011
3851704
France
2021
16/02/2012
10648905
European Union
2022
05/04/2012
1129254
2022
UNYK
13/02/2007
3207501
UNYK
UNYK
19/07/2006
30/06/2005
13/02/2007
TMA668,243
4516803
3207502
19/07/2006
TMA668,245
Russian
Federation(international
application)
United States of
America
Canada
European Union
United States of
America
Canada
30/06/2005
4518254
European Union
2015
01/12/1998
13/06/2013
2199749
2546008
Spain
Spain
2019
2023
22/06/2012
3,929,239
France
2022
PROFILE
FLOW
FOXFLY
22/06/2012
3929230
France
2022
12/07/2011
3993991
2021
Soocial
07/10/2011
0907727
United States of
America
Benelux
ICTNET
2017
2021
2015
2017
2021
2021
Moreover, the following trademarks are owned or controlled by Beijing Yingke Times Information
Technology Co., Ltd., which is not an affiliate or subsidiary of the Group (Wayson having a
contractual control of Yingke pursuant to agreements entered into between Tianji Yingke, Tianji
Boren and Wayson, as described in section 7.2 of this document de base):
Trademark
(Tian Ji in Chinese
characters)
天際天宇
(Tian Ji Tian in
Chinese characters)
Filing /
registration date
Registration no.
Countries covered
Renewal (year)
14/08/2011
8545782
China
2021
21/12/2010
07/12/2010
28/04/2009
14/12/2010
21/12/2010
21/12/2010
7555595
7555594
4882132
7555597
7555596
7555598
China
China
China
China
China
China
2020
2020
2019
2020
2020
2020
140
11.2.2 Domain names
The registration and management of the Group's domain names is an important factor for its business.
The Group has therefore systematically registered and maintained in force all domain names that are
necessary for the conduct of its business. As of the date on which this document de base is filed, the
Group owns more than 100 domain names.
The main domain names currently owned by the Group are given in the table below, it being specified
that domain names are generally renewable every year or every two years and indefinitely. The Group
has also registered a number of alternative versions of these domain names in order to secure its rights
to them.
Name
apnacircle.br.com
apnacircle.com.br
apvo.net
foxfly.com
foxfly.pro
foxflypro.com
lunch-on.fr
lunchon.fr
net-workvillage.com
pealk.com
roosher.com
soocial.com
soocial.de
soocial.es
soocial.fr
soocial.me
soocial.nl
taozhibao.cn
unyk-static.com
unyk.com
vaideo.fr
veebo.cc
veebo.me
viadeo-business.com
viadeo-business.fr
viadeo-business.net
viadeo-info.com
viadeo-premium.com
viadeo-premium.fr
viadeo-premium.net
viadeo-pro.com
viadeo-pro.fr
viadeo-pro.net
viadeo-recruiter.com
viadeo-recruiter.fr
viadeo-recruiter.net
Expiry
date
30/12/2014
27/11/2014
15/10/2014
27/10/2014
15/07/2015
20/06/2014
19/03/2015
19/03/2015
16/02/2015
21/11/2016
10/05/2016
02/10/2014
02/11/2014
08/11/2014
08/02/2015
15/10/2014
31/10/2014
18/07/2015
28/11/2014
12/08/2017
23/10/2014
07/06/2014
07/06/2014
28/01/2015
28/01/2015
28/01/2015
27/11/2014
28/01/2015
28/01/2015
28/01/2015
28/01/2015
28/01/2015
28/01/2015
28/01/2015
28/01/2015
28/01/2015
141
viadeo-static.com
viadeo-tianji.com
viadeo.at
viadeo.be
viadeo.biz
viadeo.ch
viadeo.cn
viadeo.co.uk
viadeo.com
viadeo.com.mx
viadeo.cz
viadeo.dk
viadeo.eu
viadeo.fr
viadeo.in
viadeo.info
viadeo.it
viadeo.net
viadeo.nl
viadeo.org
viadeo.pl
viadeo.pro
viadeo.ro
viadeo.ru
01/10/2014
06/01/2015
15/11/2014
29/05/2014
12/11/2014
30/11/2014
21/11/2014
18/11/2014
12/12/2015
16/08/2014
17/11/2014
15/11/2014
31/07/2014
20/11/2014
21/11/2014
09/11/2014
09/08/2014
12/12/2014
06/03/2015
13/11/2014
24/06/2014
11/03/2015
16/11/2014
21/11/2014
viadeo.se
viadeo.us
16/11/2014
20/11/2014
viadeo.xn--fiqs8s
viadeobackoffice.com
viadeobusiness.com
viadeobusiness.fr
viadeobusiness.net
viadeocorporate.com
viadeomail.com
viadeonews.com
viadeoops.com
viadeopremium.com
viadeopremium.fr
viadeopremium.net
29/10/2015
26/04/2015
28/01/2015
28/01/2015
28/01/2015
13/06/2014
01/07/2014
19/03/2015
21/04/2015
28/01/2015
28/01/2015
28/01/2015
viadeopro.com
viadeopro.fr
viadeopro.net
viadeorecruiter.com
viadeorecruiter.fr
viadeorecruiter.net
viadeotalk.com
viadeoteam.com
viadeotianji.com
viaduc.com
viaducteam.com
xn--viado-esa.be
xn--viado-esa.fr
xn--viado-esa.net
zaizher.cc
zaizher.im
zaizher.me
zaizher.net
zazzer.im
16/02/2015
26/06/2014
28/01/2015
28/01/2015
28/01/2015
28/01/2015
14/12/2014
15/11/2014
07/02/2015
21/03/2018
10/05/2015
11/06/2014
06/06/2014
31/05/2014
14/07/2014
22/07/2014
03/08/2014
03/08/2014
22/07/2014
142
Moreover, the following domain names are owned or controlled by Yingke, which is not an affiliate or
subsidiary of the Group (Wayson having a contractual control of Yingke pursuant to agreements
entered into between Tianji Yingke, Tianji Boren and Wayson, as described in section 7.2 of this
document de base):
Name
tianji.com
tianjitianyu.com
tianjitianyu.org
tianjitianyu.cn
tianjitianyu.net.cn
tianji.org
Expiry
date
22/02/2017
24/11/2017
24/03/2015
24/03/2015
24/03/2015
24/11/2017
Owner
Yingke
Yingke
Yingke
Yingke
Yingke
Yingke
11.2.3 Software
The development and management of the Group's websites as well as their promotion and
maintenance were performed through flawless management of all of the software solutions developed
on the Group's initiative and owned by it.
The Group develops its websites and software solutions almost entirely internally, mainly in the
United States but also in France and China.
In the United States, pursuant to the U.S. Copyright Act, the Group owns the copyright on the
software created by its employees within the framework of their employment contracts, which
constitute 'work made for hire'. Moreover, the confidentiality agreements entered into by the Group's
employees stipulate that the copyright on the software created by them during their time within the
Group are transferred to the Group.
In France, in accordance with legislation applicable on the date on which this document de base is
filed, the software (and its documentation) created by the Group's employees in carrying out their
duties or according to the Group's instructions belongs to the Group.
In China, software is developed by Yingke, which is not an affiliate or subsidiary of the Group
(Wayson having a contractual control of Yingke pursuant to agreements entered into between Tianji
Yingke, Tianji Boren and Wayson, as described in section 7.2 of this document de base). In the
absence of any contractual agreement to the contrary, the copyright on the software developed by
Yingke's employees using equipment and technical resources provided by Yingke belong to the latter.
Moreover, the employment contracts of Yingke's employees stipulate the transfer to Yingke of the
copyright and other intellectual property rights protecting the works (including software) created
within the framework of their employment contracts.
11.2.4 Databases
The Group owns the database of the members of the Viadeo’s platform for having taken the initiative
of its creation and consecrated for its constitution, verification and presentation a substantial financial,
material and human investment. The Group also controls the database of the Tianji platform's
members through contractual agreements granting it contractual control of Yingke in accordance with
the applicable regulations in China (as described above in section 7.2 of this document de base).
143
11.2.5 Licence agreements
11.2.5.1 ICP licence
Licence number
Jing ICP 050525
Issue date
07/08/2010
Renewal (year)
2015
As stated in sections 4.4.6 and 7.2 of this document de base, in order to comply with Chinese law
restricting the acquisition by foreign persons of companies operating in value added
telecommunication services in the People's Republic of China, the Group conducts its business
(www.tianji.com) in China through a series of contractual agreements entered into with Yingke,
Wayson Technology Development Limited ("Wayson") and Tianji Boren Technology Development
(Beijing) Co., Ltd. ("Boren") and their respective shareholders. These contractual agreements include
an exclusive technology services agreement, share pledge agreements, call options and a proxy clause
for shareholders relating to their voting rights.
Under these agreements, the Group has indirect and limited control over the trademarks, domain
names and ICP (Internet Content Provider) licences mentioned above. In other words, the
aforementioned contractual agreements do not grant the Group explicit and direct control over these
trademarks, domain names and ICP licences.
Moreover, the Group may lose control of these trademarks, domain names and ICP licenses should the
Chinese authorities decide that the agreements governing the structure of the Group's business in
China do not comply with the restrictions applying to foreign investment in the added value
telecommunication services industry and that these agreements are therefore null and void.
11.2.5.2 Licence agreements granted to the Group
The Group does not currently have any license agreements, with the exception of the IT licenses
available on the market and used for the development of technology platforms.
11.2.5.3 Licence agreements granted by the Group
On 1 January 2012, the Company and APVO entered into a license agreement with Viadeo IM, a
company incorporated under Dutch law created as part of a joint venture with the media group
Sanoma. This license agreement stipulates that the Group authorises Viadeo IM to use, without
territorial restrictions, the Viadeo and Unyk trademarks (and the associated copyright), as well as the
domain names www.viadeo.ru and viadeo.com/ru, which are necessary for the use of the Viadeo and
Unyk platforms. The license agreement was signed with a view to creating and developing the
professional social network Viadeo.ru and the Russian version of the Unyk address book. The contract
includes termination conditions similar to those stipulated under the joint venture between the parties.
11.2.6 Disputes
The Group is currently not involved in any dispute pertaining to its intellectual property rights, either
as a plaintiff or a defendant. Following an opposition proceedings initiated by IMTRON GmbH on the
basis of its former trademark PEAQ, the Group entered into a coexistence agreement with this
company on May 13, 2013 pursuant to which the Group withdrew the products covered in class 9
(notably scientific devices and instruments) originally covered by its PEALK trademark and undertook
to discontinue the use of the PEALK trademark for this type of product in the future.
144
12 TRENDS
12.1 MAIN TRENDS SINCE THE END OF THE LAST FISCAL YEAR
The Group has continued to pursue its development strategy since 31 December 2013, and has
experienced continued growth in its membership base and usage.
The membership base of the Group continued to grow at a steady pace since the end of December
2013. Over 1.8 million members joined the Group in the first quarter of 2014, of which more than 1.3
million in China and over 250,000 in France.
The Viadeo platform’s usage indicators are steadily increasing (average in the first quarter 2014 vs.
the fourth quarter 2013):
Unique Visitors:
+10%
Distinct Logins:
+5%
Data Profile:
+13%
Invitations accepted from direct contacts:
+56%
The Mobile business has also recorded very strong growth in the quarter (average in the first quarter
2014 vs. the fourth quarter 2013):
Unique Visitors:
+7%
Visits:
+22%
This positive trend has had a strong commercial impact on the first quarter of 2014 compared to the
same period in 2013, with services under production66 and orders received for Recruitment / Training
and Marketing / Advertising services all increasing significantly.
(In thousands of euros) - unaudited data Billings for Recruitment and training
services
31 March
2013
2,817
31 March
2014
3,288
Change
+17%
(In thousands of euros) - unaudited dataOrder book for Marketing
Advertising Services
and
31 March
2013
421
31 March
2014
537
Change
+28%
Income recognized for accounting in the first quarter of 2014 does not, at this stage, reflect the sales
momentum. The Group's business is mainly related to services sold in the form of subscriptions,
Revenue recognition takes into account the spread of income from subscriptions sold over the duration
of contracts (mostly over 12 months). As a result, 2014 first quarter billings will have a positive
impact on future income.
The evolution of income from operating activities by operating segment (as defined in section 9.1.3 of
this document de base) at the end of March 2014 compared to the end of March 2013 is as follows:
66
Services under production correspond to invoices issued over the period, following the client's approval of the purchase
order.
145
(euros 000) (unaudited data)
VIADEO segment
TIANJI segment
Inter-segment
Q1 2013* Q1 2014
Q1 trim
Q 2013
2014
transactions
Consolidated
Q1 2013* Q1 2014 change
3 974
3 729
-
-
-
-
3 974
3 729
-6%
2 056
2 051
109
122
-
-
2 165
2 173
0%
807
833
99
16
-
-
905
849
-6%
6 836
6 614
208
138
-
-
7 044
6 752 -4,1%
357
168
91
357
168 -53%
Turnover**
Other Income
88 (91)
(88)
Total revenues from operating activities
7 193
6 782
299
226 (91)
(88)
7 401
6 920 -6,5%
* In order to provide comparable data, the figures presented for the first quarter of 2013 have been adjusted for:
- Revenues from operating activities of the Group’s subsidiaries which were discontinued in 2013 (Mexico, India, Spain, Italy and
Senegal);
- Revenues from operating activities in Russia, as of 1 January 2014, taking into account the rights and obligations of the
partnership, the participation in the joint venture VIM LLC is accounted for using the equity method in accordance with the
provisions of IFRS 11 (no share of Revenues from operating activities is recognized).
Viadeo segment
Evolution of revenues for Online Subscriptions
Revenues for the first quarter of 2014 were down 6% compared to the first quarter of 2013, in line
with the Group's forecasts given the impact of the change of platform in 2013 and the growth of
Mobile use, which has yet to be materially monetised.
Evolution of revenues for Recruitment and Training
Revenues for the first quarter of 2014 were stable compared to the first quarter of 2013.
Billing, which corresponds to the production of the Recruitment and training services sold, increased
over the same period by 18%.
31 March
2013
2,773
(euros 000) - unaudited data Billings for Recruitment and Training services
31 March
2014
3,268
13 Change
+18%
14
15
Correspondingly, the recorded deferred revenues grew by 15% in the first quarter of 2014 compared to
the first quarter of 2013.
(euros 000) - unaudited data Deferred revenues for Recruitment and Training
services
31 March
2013
31 March
2014
2,959
3,407
16 Change
17
18
+15%
This amount corresponds to deferred revenues to be recognised in future periods.
Evolution of revenues for Marketing and Advertising Services
The revenues of the first quarter of 2014 compared to that achieved in the first quarter of 2013
increased by 3% with a backlog at year-end, up 28%.
Tianji
Given the emphasis on member acquisition and use in China to date, revenues generated by Tianji
remain insignificant.
146
12.2 KNOWN TRENDS, UNCERTAINTIES, COMMITMENTS OR EVENTS
REASONABLY LIKELY TO AFFECT THE COMPANY'S PROSPECTS
Viadeo's future prospects and goals, as presented below, are not forecasts generated through a
budgeting process, but simply objectives based on the strategic choices presented in chapter 6
"Overview of Activities" and on Viadeo's development plan.
These future prospects and goals are based on data and assumptions considered reasonable by Viadeo's
management at the date of this document de base. These data and assumptions may change or be
altered due to uncertainties, notably in relation to the regulatory, business, financial, competitive,
accounting or tax environment or due to other factors unknown to Viadeo at the date of this document
de base.
In addition, the emergence of certain risks described in chapter 4 "Risk Factors" might affect Viadeo's
business, financial position, results and prospects, as well as its ability to reach its goals. The
achievement of these objectives also implies the successful implementation of Viadeo's strategy,
presented in chapter 6 "Overview of Activities" of this document de base, which, in turn, may be
impacted by the emergence of said risks.
Thus, the Company makes no commitment nor gives any guarantees in relation to the achievement of
the prospects and goals described herein.
Viadeo's ambition is to become the professional social network of reference on the Group's markets
(see section 6.1 "Overall Presentation"). To this end, the Group aims to work in the following key
development areas (see section 6.5 "Main Development Targets" of this document de base):
- Continuing to increase the number of members;
- Increasing income, notably from the recruitment services;
- Taking advantage of the huge rise in mobile device usage and related income;
- Benefiting from the Company's strong growth in emerging markets;
- Improving operational efficiency.
With its efforts in these development areas, the Group will be pursuing the following aims:
For the Viadeo segment:
Concerning income from recruitment and training services, the recovery is expected to lead to a
significant increase in billing in 2014, which will not be recorded under recognised income in 2014
(due to the time lapse between billing and recording of income based on the duration of use of the
services by clients).
In the mid-term, the average yearly growth of this source of income is expected to exceed +35%.
The income from on-line subscriptions stream is expected to see a stabilisation in late 2014, and
moderate growth in the following years.
The Viadeo segment should generate a EBITDA margin in excess of 20% in the mid-term, with a
target of 35% in the long-term.
For the Tianji segment:
The efforts to increase Tianji's membership should lead to the number of members hitting 50 million
in the mid-term.
147
13 PROFIT FORECAST OR ESTIMATES
The Company does not intend to make any profit forecasts or estimates.
148
14 ADMINISTRATIVE, MANAGEMENT AND SUPERVISORY BODIES AND GENERAL
MANAGEMENT
14.1 EXECUTIVES AND DIRECTORS
Created under the form of a French société à responsabilité limitée, the Company was converted into a
French société anonyme with a board of directors at the general shareholders' meeting of 22 June
2006.
A short description of the main provisions of the Company bylaws that will come into force on the day
the shares are first listed on the regulated market of Euronext in Paris and of the internal rules relating
to special committees are included respectively in sections 16.3 and 21.2 of this document de base.
14.1.1 Composition of the board of directors
As of the date of this document de base, the Company's board of directors is comprised of 10 directors
and three observers.
Name
Position
Operational
functions and
other positions
within the
Group
Date first appointed and date last
renewed
First appointed as director: general
shareholders' meeting of 22 June
2006
Dan Serfaty
Chairman of the
board of directors
and
Chief executive
officer
Chairman of
APVO
Last renewed as director: general
shareholders' meeting of 28 February
2011
Term of office expires: after the
general shareholders' meeting called
Director of
to rule on the financial statements for
Wayson
the fiscal year ending 31 December
Technology
Development Ltd 2016
Appointed chairman and chief
executive officer: board of directors'
meeting of 25 February 2014, for the
duration of his term as director
First appointed as director: general
2006
Last renewed as director: general
shareholders' meeting of 28 February
2011
Thierry Lunati
Director and
Deputy chief
Technical director Term of office expires: after the
executive officer
2016
Appointed deputy chief executive
officer: board of directors' meeting
of 25 February 2014
149
Name
AV3
represented by
Olivier Lazar
Idinvest Partners
(formerly
AGF Private Equity)
represented by
Benoist Grossmann
Ventech
represented by
Alain Caffi
Derek Ling
China Biznetwork Corp
represented by
William Melton
Position
Operational
functions and
other positions
within the
Group
Director
None
Director
None
Director
None
Director
None
renewed
First
appointed:
general
2006
Last renewed: general shareholders'
meeting of 28 February 2011
2016
First
appointed:
general
2006
2016
First
appointed:
general
2006
2016
First
appointed:
general
shareholders'
meeting
of
2
September 2009
2014
First
appointed:
shareholders'
meeting
September 2009
Director
None
150
general
of
2
2014
Name
Bpifrance Participations
(formerly FSI)
represented by
Jean d'Arthuys
Position
Operational
functions and
other positions
renewed
within the
Group
First
appointed:
general
shareholders' meeting of 25 April
2012
Director
None
2017
First
appointed:
general
shareholders' meeting of 25 April
2012
William Henry Johnston
A
CAPITALManagement
S.A.
represented by Yanlai
Mao
2017
Director
First
appointed:
general
shareholders' meeting of 21 May
2014
None
Director
2019
Three observers, all founders of entities bought by the Company and therefore experts in their field,
also attend board of directors' meetings:
 Yogesh Bansal (joint founder of ApnaCircle);
 Sabeer Bhatia (joint founder of ApnaCircle); and
 Sébastien Brault (founder of Unyk).
All three were appointed by the general shareholders’ meeting of 28 February 2011 for a period of six
fiscal years expiring at the close of the general shareholders' meeting called to rule on the financial
statements for the fiscal year ending 31 December 2016.
The business address of the chairman and chief executive officer and the deputy chief executive
officer is the registered office of the Company.
151
The business addresses of the other directors are as follows:
 AV3: 30 rue de la Victoire, 75009 Paris,
 Idinvest Partners: 87 rue Richelieu, 75002 Paris,
 Ventech: 47 avenue de l’Opéra, 75002 Paris,
 Derek Ling: 19 H, Merlin Champagne Tianzhu Shunyi 101312 Beijing (China),
 China Biznetwork Corp: 2086 Hunters Crest Way 22181 Vienna – va (United States),
 BPI France: 27-31 avenue du Général Leclerc, 94710 Maisons-Alfort Cedex
 A Capital Management SA: "Le Dôme" Espace Pétrusse, 2 avenue Charles de Gaulle,
B.P.351, L-2013 Luxembourg,
 William Henry Johnston: 4 avenue Hoche, 75008 Paris,
The expertise and management experience of these persons comes from various salaried and senior
management positions they have held in the past (see section 14.1.3 of this document de base).
No family ties exist between the persons mentioned above.
Over the last five years, none of the above persons:
 has been found guilty of fraud;
 has been involved in a bankruptcy, receivership or liquidation in their position as director or
administrator;
 has been banned from managing a company;
 has been subject to any official public incrimination or sanctions by statutory or regulatory
authorities.
152
14.1.2 Other executive positions
Other current executive positions (outside the Group)
Other current executive positions outside the Group
Nature of executive position
Company
Chairman
Chairman
Co-manager
Director
AV3
VI09
KDS ASSOCIES SARL
CHINA BIZNETWORK CORP (CBC)
Thierry Lunati
Manager
Manager
FINANCIERE MARLU SC
KADOMI SARL
AV3
(Olivier Lazar)
Chief executive officer
Manager
Permanent representative of Angyal on
the board of directors
Permanent representative of Angyal on
Permanent representative of Amplégest
AMPLEGEST SA
SCI OK VEP
DIRECTANNONCES SA
Permanent representative of Idinvest
Partners on the board of directors
Partners as observer on the board of
directors
Partners as observer on the board of
directors
Member of the executive board
WINAMAX
Permanent representative of Ventech on
the management board
Member of the supervisory board
Chairman of the board of directors
Chairman of the management board
Observer
AUGURE
Dan Serfaty
Idinvest Partners
(formerly
AGF Private Equity)
(Benoist Grossmann)
Ventech
(Alain Caffi)
153
PROMETIS SA
SICAV MARIGNAN
WITHINGS
24H00
SENSEE
VIDEOPOLIS
IDINVEST PARTNERS
BELIEVE
EYEKA
IN COM
WEBEDIA
QUANTAM EQUITY
SOJEANS
SHOPMIUM
INITIATIVE FINANCE GESTION
NATIXIS VENTURE SELECTION
VENTECH
OKTOGO
Other current executive positions outside the Group
Ventech
(Alain Caffi) cont.
Derek Ling
Company
Observer
Manager
Director
Director
PIXONIC
VENTECH CHINA SARL
FR ON LINE
DARMONDO
None
None
Director
China Biznetwork Corp Director
Manager
(William Melton)
E4E
TARANG TECHNOLOLGY
GLOBAL INTERNET
VENTURES LLC
Permanent representative of
Bpifrance Participations on the board
of directors
of directors
(formerly FSI)
(Jean d'Arthuys)
of directors
of directors
ST MICROELECTRONICS
Manager
Manager
Manager
A CAPITAL
Management S.A.
(Yanlai Mao)
TALEND
EUTELSAT
SOPROL
Director
FINANCIERE WM SARL
STONE PARTICIPATIONS SARL
JOHN STONE PRODUCTIONS
SARL
STONE PARTICIPATIONS ET
INVESTISSEMENTS SAS
HADES
None
None
Chairman
154
Other executive positions held over the last five fiscal years and no longer held (outside the
Group)
Other executive positions held over the last five fiscal years and no
longer held (outside the Group)
Dan Serfaty
Chief executive officer
Thierry Lunati
AV3
(Olivier Lazar)
Idinvest Partners
(formerly
AGF Private Equity)
(Benoist Grossmann)
Ventech
(Alain Caffi)
Derek Ling
Company
AGREGATOR GESTION
None
None
Deputy chief executive officer
Chairman of the management board
OLYMPIA CAPITAL
MANAGEMENT
OLYMPIA CAPITAL GESTION
Permanent representative of Angyal
ACTA Group
OLFO
ENTERTAIN
Director
CRITEO
Permanent representative of Ventech
on the board of directors
on the supervisory board
on the board of directors
Director
Director
ISTAC
None
None
DAILYMOTON
NEMPTIC
WSTORE
IXEN PARTNERS
IXEN
NATIXIS PRIVATE EQUITY
NATIXIS PRIVATE EQUITY
INTERNATIONAL Management
Chairman and chief executive officer SOFINETI
China Biznetwork Corp Manager
(William Melton)
Director
GIV SBIC LLC
PIPELINE TRADING
(formerly FSI)
Director
(Jean d'Arthuys)
INDEFILMS (SOFICA)
William Henry Johnston None
None
A CAPITAL
Management S.A.
None
None
(Yanlai Mao)
155
14.1.3 Directors' and observers’ biographies
Dan Serfaty is the co-founder and CEO of Viadeo. He oversees all Viadeo
operations at an international level. Viadeo’s basic premise was first developed
in 2000 when Dan Serfaty teamed up with two friends (one of whom was
Thierry Lunati, co-founder of Viadeo) at Creadev, a fund owned by the Mulliez
family. Together, they went on to launch an innovative concept in the private
equity world - Agregator, an entrepreneurs’ club that aggregated and valued
private company shares to fund the expansion of member companies. On the
back of this success, and armed with a network of 400 members, Viadeo first
emerged in 2004. Prior to founding Viadeo, Dan Serfaty was involved in a string
of entrepreneurial ventures including the formation and turnaround of several
companies in the tourism sector and the creation of a company specialising in the
distribution of textile products from Asia. Dan is a graduate of HEC (Ecole des
Hautes Etudes Commerciales).
Thierry Lunati co-founded Viadeo alongside Dan Serfaty. He oversees Viadeo’s
technology strategy. The first steps towards Viadeo’s creation were taken in
2000 when Thierry and Dan launched Agregator, an entrepreneurs’ club that
aggregated and valued private company shares to fund the expansion of member
companies. That same year, Thierry also co-founded TBX Trade, an innovative
stock exchange online trading solution. Previously, Thierry had been involved in
several company start-ups, including Forlog, an IT training company, and the
search engine Lokace in 1993, which quickly became a benchmark in the sector
and was sold to Infosources less than two years later. In 1996, Thierry also cofounded the online portal and webmail service Caramail that was purchased by
Lycos in 2000.
Thierry is a graduate of Ecole Centrale de Paris and HEC.
Olivier Lazar (permanent representative of AV3): in July 2012, Olivier Lazar
became CEO of Amplégest, an entrepreneurial management company
specialising in three main areas: private management (wealth consulting,
discretionary management, etc.), asset management (Eurozone, Small and
Midcap, and flexible, top-down activity management) and family office services.
Before joining Amplégest, Olivier was chairman of the executive board at
Olympia Capital Gestion from 1995 to 2012, a company providing fund
management for private clientele, and previously worked as head of Banque
OBC’s Asset Management department for more than eight years. During his
career, Olivier Lazar has also led several projects on behalf of Banque LouisDreyfus, World Promotions, and OTTO Lazar SA.
156
Benoist Grossmann joined Idinvest Partners in 2002. He was appointed a member of
the executive board in 2003 and operates mainly in the Internet sector. Before joining
Idinvest Partners, Benoist worked for several venture capital funds for over ten years.
He was a partner at Viventures from 1998 to 2002 and worked as Investment
Manager at La Financière de Brienne. He had previously spent over ten years
working as a laser systems specialist at EDF, NASA and Thomson-CSF Optronique,
for whom he invented five patents and authored some twenty publications.
The holder of a Ph.D. in physics from Paris VI University and an MBA from the
Institut d’Etudes Politiques de Paris, Benoist is currently on the boards of Viadeo,
Sigfox, Withings and Winamax and was previously on the boards of Criteo,
Dailymotion and Meetic.
In 1998, Alain Caffi founded Ventech, a company dedicated to providing IT
solutions for businesses and is now a Partner. Alain has 18 years of experience
working for a diverse range of private equity companies. He has particularly strong
experience in the organisation of syndicates, corporate governance and crisis
management as well as the organisation of mergers and acquisitions and initial
public offerings. In 1986, Alain was involved in the launch of the NATIXIS
investment fund, which became one of the leading private equity firms in France.
Alain currently sits on the boards of many Internet companies including Viadeo.
Derek Ling founded Tianji.com in 2005. It quickly became the largest professional
social network in China. Derek joined the Viadeo Group in 2007. Derek is an
experienced entrepreneur with a strong background in business start-ups. A former
Vice President at Sina.com, he has also held senior positions at Motorola and Apple
Inc. Throughout his career, Derek has been a strategy consultant and advisor to key
companies in China including Daren, the country's leading entertainment production
company, and mobile service provider Beijing Mobiledata. Derek graduated from
Stanford University.
William Melton is co-founder of Global Internet Ventures, a private equity firm
specialising in new technology. A leading entrepreneur in integrating technology
into the financial world, he has founded several companies including Verifone in
1981 and CyberCash in 1994. He also founded the Melton Foundation, an
international community devoted to combining exceptional young talent with new
technologies. William Melton is an active investor in and board member of multiple
young businesses in the ICT sector.
Jean d’Arthuys has been a member of the executive committee at France’s Strategic
Investment Fund (FSI) since June 2010. Now a part of BPI, the group aims to foster
economic growth and competitiveness and to serve public interest by responding to
the capital requirements of French businesses. After graduating from HEC, he built
his career within media and digital roles, most notably at the heart of the M6 group,
where he became a member of the management board in 1999 after having been in
charge of development from 1996 to 1999. He served more recently as Chairman
and CEO of television channels Paris Première and W9 (in 2004 and 2005
respectively) and, owing to his considerable experience in digital media, has since
been a director at TPS, Sportfive, and Newsweb, and Chairman and CEO of the
French soccer club Les Girondins de Bordeaux. From 2007 to 2010 he acted as a
partner at PAI Partners, in charge of media, Internet, and telecoms.
157
William Johnston’s entrepreneurial career began in 1982 with the founding of Stone
International. Providing real estate services and equity financing, the company
specialises in office buildings in Parisian business districts. In 2001, he went on to
co-found Stone Participations AM, specialising in real estate asset management on
behalf of foreign institutional investors. A contemporary art aficionado, William
Johnston also set up John Stone Productions in the same year and co-produces plays
and films. William Johnston has also founded an investment company in the sectors
of renewable energy, electric vehicles and the Internet. He is also a board member of
Hades (branded under Terga and ESE).
Yanlai Mao is a partner in A CAPITAL, a leading investment fund focusing on
transactions between Europe and Asia. A CAPITAL invests in highly-performing
European companies to accelerate their growth in emerging markets and China in
particular..
Yanlai Mao played an essential role in two key transactions executed by A
CAPITAL: French tourism group Club Med and high-end Danish brand Bang
&Olufsen.
Before joining A CAPITAL, Yanlai Mao was in charge of M&A activities at
Technicolor in Paris, following a five-year period spent at Alcatel Shanghai Bell
(Chinese subsidiary of Alcatel Lucent) as Senior Manager supporting the board of
directors. He is fluent in Chinese, French and English and is very familiar with
European and Chinese cultures.
Yanlai Mao holds an MBA from HEC Paris, as well as being a graduate from the
Shanghai International Studies University.
Yogesh Bansal is the founder of ApnaCircle, an Indian professional social
network acquired by the Viadeo Group and integrated in Viadeo's platform.
Before establishing ApnaCircle.com, Yogesh Bansal carried out market research
on social networks. In the earlier stages of his career, Yogesh Bansal worked at
McKesson Inc, a company providing innovative healthcare services. As a true
entrepreneur, he is involved in many community activities in India and his work
has been published a number of times. Yogesh Bansal holds an MBA from the
University of North Carolina.
Indian IT mogul Sabeer Bahtia co-founded Hotmail in 1996. He was chairman
and CEO of the company until it was acquired by Microsoft in 1998. In 2007, he
became a member of the board of directors of ApnaCircle. Following
ApnaCircle's acquisition by Viadeo in 2009, Sabeer joined Viadeo's management
board. Sabeer's success has been acknowledged by many awards and prizes,
including being named by TIME Magazine as one of the "People to Watch" in
International Business in 2002.
An experienced entrepreneur, Sébastien Brault has created a number of Internet
companies,
including
G2
Communication,
Webseduction.com
and
BeehiveCommunities. He was chief executive officer of NetClub.com before
establishing Unyk.com in 2007. Unyk is a smart address book enabling its users to
import, store and synchronise their contacts across multiple platforms. Unyk was
bought by Viadeo in 2009. In 2011, Sébastien founded Viralornot.com, of which
he is currently the chief executive officer.
158
14.2 CONFLICTS
OF
INTEREST
WITHIN
THE
ADMINISTRATIVE,
MANAGEMENT
AND
SUPERVISORY
BODIES
AND
GENERAL
MANAGEMENT
The chairman and chief executive officer, the deputy chief executive officer and the directors are
direct or indirect shareholders of the Company and/or holders of securities giving access to the share
capital of the Company (see details in section 17.2 of this document de base).
There exist related-party agreements, described in sections 16.2 and Chapter 19 of this document de
base.
In December 2010, the Company signed a commercial lease with the company Société Civile
Immobilière 28-30 bis Victoire for the premises of its registered office. In April 2012, one of the
majority partners and manager of said lessor became a shareholder of the Company, holding a 1.33%
stake.In addition, the lessor's manager is managed and controlled by a natural person appointed
director of the Company in April 2012.
The annual rent for the Company's head office stands at €964Ks in 2014.
To the Company's knowledge, and with the exception of the point mentioned above, there are no
actual or potential conflicts of interest between the duties to the Company and the private interests
and/or other duties of the members of the administrative, management and supervisory bodies, as
referred to in section 14.1 above.
The agreement signed by the Company's major shareholders on 26 April 2012 will be automatically
cancelled on the date of the initial listing of the Company's shares on the regulated market of Euronext
in Paris.
To the Company's knowledge, no arrangement or agreement exists with the shareholders, customers,
suppliers or other entities under the terms of which a member of the board of directors has been
named.
To the Company's knowledge, as of the date on which this document de base was filed, there are no
restrictions agreed by the persons referred to in section 14.1 "Executives and directors" of this
document de base, concerning the sale of their stake in the share capital of the Company, other than
the agreement mentioned above and with the exception of the shares included in the commitments
described in section 21.1.6 below.
15 COMPENSATION AND BENEFITS
159
15.1 COMPENSATION OF DIRECTORS AND EXECUTIVES
The information in this chapter is based on the Corporate Governance Code for Small and MediumCapitalization Companies as published in December 2009 by Middlenext and validated as a reference
code by the French Financial Markets Authority (AMF). The tables included in the Recommandation
AMF relative à l’information à donner dans les prospectus sur la rémunération des mandataires sociaux
du 22 décembre 2008 (AMF recommendation dated December 22, 2008 with regard to the information to
be provided in prospectuses concerning the compensation of directors) are presented below.
Table no. 1: summary of the compensation, founders warrants (BSPCE) and free shares granted
to each executive director (dirigeant mandataire social)
Summary table of the compensation, founders’ warrants (BSPCE) and
free shares granted to each executive director (dirigeant mandataire social)
FY 2013
Name
FY 2012
Dan Serfaty - chairman and chief executive officer(1)
Compensation with respect to the fiscal year (detailed in table no.2)
551.5
482.6
Value of multi-year variable compensation awarded during the fiscal year
Value of founders warrants (BSPCE) granted during the fiscal year (detailed in table no.4)
-
241.0(3)
(2)
-
Value of free shares allocated during the fiscal year
-
-
551.5
723.6
285.2
275.2
TOTAL
Thierry Lunati - deputy chief executive officer
(1)
Compensation with respect to the fiscal year (detailed in table no.2)
Value of multi-year variable compensation awarded during the fiscal year
Value of founders warrants (BSPCE) granted during the fiscal year (detailed in table no.4)
(2)
Value of free shares allocated during the fiscal year
TOTAL
TOTAL
-
241.0(3)
-
-
285.2
516.2
836.7
1,239.8
(1) The board of directors' meeting of 25 February 2014 appointed Mr Dan Serfaty as chairman
and chief executive officer and Mr Thierry Lunati as deputy chief executive officer. Until that
date, and therefore during the period presented (2012 and 2013), Mr Lunati was chairman
and chief executive officer and Mr Serfaty was deputy chief executive officer;
(2) The valuation method is described in note 11.2 of the notes to the consolidated financial
statements included in chapter 20.1 of this document;
(3) This amount corresponds to the IFRS expense recognised with respect to the fiscal year in
which founders' warrants (BSPCE) were granted to the beneficiaries.
160
Table no. 2: summary table of compensation of each executive director
Summary of compensation of each director (In thousands of euros)
FY 2013
Amounts
Amounts
due with
paid with
respect to
respect to
2013
2013
Name
Dan Serfaty - chairman and chief executive officer(1)
Fixed annual compensation
FY 2012
Amounts
Amounts
due with
paid with
respect to
respect to
2012
2012
389.0
389.0
342.6
342.6
162.5
551.5
162.5
551.5
140.0
482.6
140.0
482.6
285.2
285.2
275.2
275.2
285.2
836.7
285.2
836.7
275.2
757.8
275.2
757.8
Variable annual compensation
Multi-year variable compensation
Exceptional compensation
Attendance fees
Benefits in kind
TOTAL
Thierry Lunati - deputy chief executive officer(2)
Fixed annual compensation
Variable annual compensation
Multi-year variable compensation
Exceptional compensation
Attendance fees
Benefits in kind
TOTAL
TOTAL DIRECTORS(3)
(1) Compensation of Mr Dan Serfaty: in relation to his various roles within the Group, during the
period presented Mr Dan Serfaty received the following compensation:
a) Compensation as director:
- with respect to his position as chief executive officer of the Company, Mr Serfaty received
€36K for each of the 2012 and 2013 fiscal years:
- with respect to his position as director of Wayson Technology Development Limited
("Wayson"),MrSerfaty received €53.4Kin 2012 and €61.5K in 2013.
b) Employment contracts: with respect to his two employment contracts, namely one contract
with Wayson as director of operations and another with Tianji Boren Technology
Development (Beijing) Co., Ltd. ("Boren"), as director of operations, Mr Serfaty received
total fixed compensation of €253.2K for 2012 and €291.5K for 2013.
Under his employment contract with the Chinese subsidiary, he also benefited from
accommodation as part of his expatriation. This benefit in kind amounted to €140K in 2012
and €162.5K in 2013.
The compensation received in Hong Kong and China with respect to both his positions as director and
under his employment contracts did not change significantly in local currency in 2013 as compared to
2012, as the variations observed were mainly related to exchange rate fluctuations.
The fees received by KDS Associés for services rendered by Mr Dan Serfaty and invoiced under the
agreement between the Company and KDS Associés, the main terms of which are described in chapter
16.2 of this document de base, should be added to Mr Dan Serfaty’s total compensation. The amount
of the fees charged was €115,500 for 2012 and €67K for 2013. These amounts only correspond to the
161
portion of services rendered by Mr Dan Serfaty67, chairman and CEO of the Company, and are
included in the total amount of fees invoiced by KDS Associés mentioned in the statutory auditors'
special report on regulated agreements.
(2) Compensation of Mr Thierry Lunati: in relation to his various roles within the Group, during the
period presented Mr Thierry Lunati received the following compensation:
a) Compensation as Director: with respect to his role as chairman and chief executive officer of
the Company, Mr Lunati received €42K for each of the 2012 and 2013 fiscal years.
b) Employment contract: with respect to his employment contract with APVO Corporation as
technical director, Mr Lunati received total fixed compensation of €233.3K for 2012 and
€243.,2K for 2013.
The compensation received in the United States did not change in local currency in 2013 as compared
to 2012, as the variations observed related exclusively to exchange rate fluctuations.
(3) The fees received by Kadomi for services rendered by Mr Thierry Lunati and invoiced under the
agreement between the Company and Kadomi, the main terms of which are described in section16.2
of this document de base, should be added to Mr Thierry Lunati’s total compensation. The fees
invoiced in this respect amounted to €324,100 for 2012 and €322K for 2013.
With respect to the 2014 fiscal year, no significant changes to the structure or amount of the fixed
compensation paid to the two executive directors are currently envisaged. However, for both
executives, an exceptional bonus conditional upon the success of the IPO and in an amount up to
€100K is envisaged.
The difference between the services billed by KDS Associés as described in Section 16.2 of this document de
base and the share in respect of services rendered by Dan Serfaty is related to the rebilling of the salary costs of
another person employed by KDS in 2013 and having provided services for Viadeo under the agreement.
67
162
Table no. 3: attendance fees and other compensation received by non-executive directors
(mandataires sociaux non dirigeants)
Attendance fees and other compensation received by non-executive directors
(mandataires sociaux non dirigeants)(In thousands of euros)
Non-executive
FY 2013
FY 2012
director
Amount paid
Amount paid
AV3
Attendance fees
-
-
Other compensation
-
-
Attendance fees
-
-
Other compensation
-
-
Attendance fees
-
-
Other compensation
-
-
Attendance fees
-
-
Other compensation(1)
-
164.6
Attendance fees
-
-
Other compensation
-
-
Attendance fees
-
-
Other compensation
-
-
Attendance fees
-
-
Other compensation
-
-
-
164.6
Idinvest Partners
Ventech
Derek Ling
China Biznetwork Corp
Total
(1) In 2012, Mr Ling received €164.6K€ as director, as agreed with the subsidiary Wayson
Technology Development Ltd. in Hong Kong. In 2013, Mr Ling withdrew from the exercise of
his operational positions.
163
Table no. 4: stock options granted to each executive director (dirigeant mandataire social) by the
Company or any company within the Group during the fiscal years ended 31 December 2013
and 2012
Stock options allocated to each executive director (dirigeant mandataire social) by the issuer during the 2013 and
2012 fiscal years
Name of executive
director
Plan no. and
date
Dan Serfaty
BCE 05
10-Sep-12
Thierry Lunati
BCE 05
10-Sep-12
Type of options
(subscription or
purchase)
Value of options
according to the
method used for
the financial
statements
(IFRS)
Number of
options
allocated
during FY
2012
Exercise
price(1)
Exercise
period
€525K
2,500
€19,066
(2)
€525K
2,500
€19,066
(2)
Founders warrants
Founders warrants
(1) Exercise price taking into account the 25-for-1 stock split decided by the combined general
shareholders’ meeting of 21 May 2014.
(2) Refer to section 21.1.4 of this document de base
Table no. 5: stock options exercised by each executive director (dirigeant mandataire social)
during the fiscal years ended 31 December 2013 and 2012
None.
Table no. 6: free shares granted to each executive director (dirigeant mandataire social) during
the fiscal years ended 31 December 2013 and 2012
Not applicable.
Table no. 7: free shares granted that became available for each executive director (dirigeant
mandataire social) during the fiscal years ended 31 December 2013 and 2012
Not applicable.
Table no. 8: history of stock options granted to directors
Refer to the tables in sections 21.1.4 of this document de base.
Table no. 9: stock options granted to the 10 non-director employees (salariés non mandataires
sociaux) who received the largest number of options and options exercised by those employees
Refer to the table in chapter 17.2 of this document de base.
Table no. 10: history of free share allocations
Not applicable.
164
Table no. 11: conditions for compensation and other benefits granted to executive directors
(mandataires sociaux dirigeants)
Executive director
Employment
contract
Supplementary
pension scheme
YES
YES
NO
NO
compensation or benefit
due or liable to be due in
respect of a termination
or change of position
YES
Compensation
relating to a noncompetition clause
NO
YES
X
X(2)
NO
Dan Serfaty(1)
Chairman and chief
executive officer
Date term of office
started
First appointed: 22 June 2006
Date term of office ends
Last renewed: 28 February 2011
At the close of the general shareholders’ meeting held to approve the financial statements for
the year ending 31 December 2016
X
X
Thierry Lunati(1)
Deputy chief executive
officer
Date term of office
started
First appointed: 22 June 2006
Date term of office ends
Last renewed: 28 February 2011
At the close of the general shareholders’ meeting held to approve the financial statements for
the year ending 31 December 2016
X
X
X
X(3)
X
(1) The board of directors' meeting of 25 February 2014 appointed Mr Dan Serfaty as chairman
and chief executive officer and Mr Thierry Lunati as deputy chief executive officer. Until that
date, Mr Lunati was chairman and chief executive officer and Mr Serfaty was deputy chief
executive officer. The date first appointed given in the table is the date of initial appointment
to their previous respective positions, it being specified that the duration of their respective
terms of office as Company director has not been amended.
(2) Non-competition obligation in respect of Dan Serfaty for a period of 12 months following
termination of his positions as operations director for Wayson or director of operations for
Boren, providing for compensation in an amount equal to the sum of the total fixed
compensation received in 2013 in respect of said positions in Wayson and Boren (i.e.
€291,5K).
(3) Non-competition obligation in respect of Thierry Lunati for a period of 12 months following
termination of his position as technical director for APVO Corporation, providing for
compensation in an amount equal to the sum of the total fixed compensation received in 2013
in respect of said position in APVO Corporation (i.e. €243,2K)
15.2
AMOUNTS PROVISIONED BY THE COMPANY FOR THE PAYMENT OF
PENSIONS, RETIREMENT FUNDS AND OTHER ADVANTAGES IN
FAVOUR OF DIRECTORS AND EXECUTIVES
The Company did not make any provisions for the payment of pensions, retirement funds and other
advantages in favour of directors and executives.
165
15.3
FOUNDERS WARRANTS (BSPCE), WARRANTS (BSA) AND OTHER
SECURITIES GIVING ACCESS TO SHARE CAPITAL GRANTED TO
DIRECTORS AND EXECUTIVES
The table below presents, as of the date on which this document de base was filed, a summary of all
securities giving access to share capital, irrespective of their nature, issued by the Company and
detailed in section 21.1.4.1 of this document de base, in favour of its directors and/or executives.
Directors
Dan Serfaty (chairman
and CEO)
Director
Thierry Lunati (deputy
CEO)
Director
AV3
Director
BCE 05
Number of shares
liable to be issued
as a result of these
securities(1)
14,233
2,500
418,325
14,233
2,500
418,325
BCE 01
BCE 02
BCE 03
BCE 04
Idinvest Partners
Director
Ventech
Director
Derek Ling
Director
500
12,500
China Biznetwork
Corp.
Director
Bpifrance
Participations
Director
William Henry
Johnston
Director
14.3
14.4
TOTAL
28,466
-
14.5
500
14.6
-
14.7
5,000
14.8
14.10
14.9
849,150
(1)
After taking into account the 25-for-1 stock split decided by the general shareholders’
meeting of 21 May 2014.
166
16 FUNCTIONING OF ADMINISTRATIVE AND MANAGEMENT BODIES
16.1 COMPANY MANAGEMENT
Created under the form of a French société à responsabilité limitée, the Company was converted into a
French société anonyme à conseil d’administration by the general shareholders' meeting of 22 June
2006. The detailed composition of the board of directors is described in paragraph 14.1 of this
document de base.
The board of directors, which convened for the first time on 22 June 2006, decided not to separate the
duties of chairman and chief executive officer and also appointed a deputy chief executive officer.
On 25 February 2014, the board of directors decided to appoint Mr Dan Serfaty as chairman and chief
executive officer and Mr Thierry Lunati as deputy chief executive officer for the Company.
16.2 INFORMATION
ON
THE
SERVICES
EXECUTIVES AND THE COMPANY
CONTRACTS
BETWEEN
In addition to the three employment contracts, the main terms of which are described in chapter 19.1
of this document de base:

Mr Dan Serfaty entered into a permanent employment contract on 1 September 2011 with
Boren, the Company's Chinese subsidiary, under which he performs the duties of chief
executive officer within this company.

Mr Dan Serfaty also entered into a permanent employment contract on 1 September 2011 with
Wayson, the Company's Hong Kong subsidiary, under which he performs the duties of
director of operations within this company.

Mr Thierry Lunati entered into a permanent employment contract on 10 January 2011 with
APVO, the Company's American subsidiary, under which he performs the duties of technical
director within this company,
the Company has entered into two services contracts with companies related to both these executives.
Contract with KDS Associés68
The Company entered into a services contract with KDS Associés, a French société à responsabilité
limitée, of which Mr Dan Serfaty, the Company's chairman and chief executive officer, is co-manager.
This contract was signed on 15 December 2005 and amended on 1 May 2006, 15 February 2007, 30
June 2008,1 August 2010 and 26 May 2014. The execution of this contract was approved by the
Company's general shareholders' meeting of 26 June 2007 and was subject to a special report by the
Company's statutory auditors (see paragraph 19.3 of this document de base).
The services provided by KDS Associés to the Company under this contract consist of technical
support services including consultancy services regarding sales and marketing development,
administrative, legal and financial management, operational management, and in particular services
such as the development and implementation of the Company's marketing strategy, the negotiation and
development of business proposals, the preparation and definition of business plans and the various
budgets, and the management of relations with accounting and legal consultancy firms.
68
KDS Associés is 90%-held by Dan Serfaty and 10%-held by Karen Serfaty
167
This contract provides that each party may terminate the contract at any moment, subject to a 12
month notice period, in the case of unilateral termination by the Company, with a requirement to call
upon the services of KDS Associés for a minimum of 85 days during the notice period and, in the case
of unilateral termination by KDS, with the latter's commitment to make itself available for the same
minimum number of days during the notice period.
The services are provided by KDS Associés on the basis of a daily flat rate of €3,500 excluding taxes
and charges, it being specified that the assignment must be completed within a period of between 60
and 100 days per year.
The Company paid €185.5K to KDS Associés in the last fiscal year, excluding taxes and charges.
Contract with Kadomi69
The Company also entered into a services contract with Kadomi, a French société à responsabilité
limitée, of which Mr Thierry Lunati, the Company's deputy chief executive officer, is the manager.
This contract was signed on 1 October 2006 and amended on 30 June 2010, 20 December 2010 and 26
May 2014. The conclusion of this contract was approved by the Company's general shareholders'
meeting of 26 June 2007 and was the subject of a special report by the Company's statutory auditors
(see paragraph 19.3 of this document de base).
The services rendered by Kadomi under this contract include technical support services to the
Company, for example assistance with the development of technical and functional features for the
Viadeo.com website, including in particular the choice of the website's technical architecture and its
development, the development of the website's data models and assistance with the site's
implementation.
This contract provides that each party may terminate the contract at any moment, subject to a 12
month notice period, and coupled, in the case of unilateral termination by the Company, with a
requirement to call upon the services of Kadomi for a minimum of 85 days during the notice period
and, in the case of unilateral termination by Kadomi, with the latter's commitment to make itself
available for the same minimum number of days during the notice period.
The services are provided by Kadomi on the basis of a daily flat rate of €3,500 excluding taxes and
transport/accommodation charges, it being specified that the assignment must be completed within a
period of between 170 and 200 days per year.
The Company paid €322K to Kadomi in the last fiscal year, excluding taxes and charges.
There is no other agreement between a corporate officer and the Company.
69
Kadomi is wholly-owned by Thierry Lunati
168
16.3 BOARD OF DIRECTORS AND SPECIAL COMMITTEES - CORPORATE
GOVERNANCE
16.3.5 Board of directors
The composition of the board of directors and information regarding its members are covered by the
developments set out in chapters 14 "Administrative, management and supervisory bodies and general
management" and 21.2 "Memorandum and bylaws" of this document de base.
Directors can be compensated by attendance fees, which are allocated to directors based on their
attendance at meetings of the board of directors and their participation in special committees.
Internal rules were adopted by the board of directors at its meeting of 26 May 2014.
In particular, these internal rules list the business principles and obligations of the members of the
Company's board of directors. All directors undertake to maintain their independence of thought,
judgement and action, and to participate actively in the board's work. They will inform the board of
any conflicts of interest they may face. Furthermore, the Board reiterated the applicable regulations
pertaining to the dissemination and use of inside information and specified that its members should
refrain from performing securities transactions when they have inside information. Each director must
declare any transactions carried out directly or indirectly on the Company's securities to the Company
and the AMF.
The board of directors considers that Société A CAPITAL Management S.A., represented by Mr
Yanlai Mao is an independent director within the meaning of the Corporate Governance Code for
Small and Medium Capitalization Companies, as published by MiddleNext in December 2009 and
approved as a reference code by the AMF, insofar as Société A CAPITAL Management S.A.,
represented by Mr Yanlai Mao:

is neither an employee nor executive director (mandataire social dirigeant) of the Company or
of one of its subsidiaries, and has not been in the last three years;

is not a significant customer, supplier or banker of the Company or its Group, or for which the
Company or its Group comprises a significant portion of its business;

is not a reference shareholder in the Company;

has no close family ties with a director (mandataire social) or reference shareholder; and

has not been an auditor of the Company in the last three years.
The number of meetings of the board of directors takes into account the various events that punctuate
the Company's life. Accordingly, the board of directors meets as often as is required by the Company's
current position.
Over the year ended 31 December 2013, the Company's board of directors met six times and the
average attendance rate for board members amounted to 85.2%.
Over the year ended 31 December 2012, the Company's board of directors met nine times and the
average attendance rate for board members amounted to 89%.
At the registration date of this document de base, the board of directors also included three observers,
namely Mr Yogesh Bansal, Mr Sabeer Bhatia and Mr Sébastien Brault. The observers are invited to
the board of directors meetings under the same terms as the board members and, accordingly, benefit
from a right to information prior to the board meetings, under the same terms as the board members.
They attend board meetings in a consultative capacity only.
169
16.3.6 Special committees
16.3.6.1 Audit committee
By decision of the board of directors on 26 May 2014, the Company set up an audit committee for an
indefinite period. The members of the audit committee set out their committee's operating rules in the
internal rules approved by the board of directors on 26 May 2014.
The main terms of the audit committee's internal rules are described below.
16.3.6.1.1 Composition
The audit committee comprises at least two members appointed by the board of directors after the
appointment and compensation committee has given its opinion. The members of the audit committee
are chosen from among the members of the board of directors and, as far as possible, two thirds of
them are independent members, with at least one of them having special financial or accounting skills,
it being specified that all members have a minimum level of proficiency in terms of financial and
accounting expertise.
At the registration date of this document de base, the members of the audit committee were:

-
the company Bpifrance Participations, director, represented by Mr Jean d’Arthuys, and
the company A CAPITAL S.A., director, represented by Mr Yanlai Mao, independent member
of the board with special finance or accounting skills.
It is specified, where appropriate, that the members of the audit committee are members of the board
of directors not performing management duties.
16.3.6.1.2 Duties
In particular, the audit committee is responsible for:

monitoring the financial reporting process;

monitoring the effectiveness of internal control and risk management systems;

monitoring the statutory auditors’ audit of the annual and consolidated financial statements;

issuing a recommendation on the statutory auditors proposed for appointment by the general
shareholders' meeting and reviewing the terms for their compensation;

monitoring the independence of statutory auditors;

assessing the conditions for the use of derivatives;

regularly monitoring the status of material litigation;

assessing the Company's procedures in terms of receiving, keeping and processing complaints
related to accounting matters and accounting checks performed internally, to questions related
to accounting checks and the documents provided by employees on an anonymous and
confidential basis, and which may challenge accounting practices or those related to
accounting checks; and

more generally, to provide advice and make appropriate recommendations in the abovementioned areas.
170
16.3.6.1.3 Functioning
The audit committee meets at least four times a year, with the statutory auditors if the committee's
chairman considers it useful, based on a schedule determined by the chairman, to assess the annual,
half-yearly and, where appropriate, quarterly consolidated financial statements, based on an agenda
approved by the chairman and sent to the audit committee members no later than seven days before the
meeting. The committee also meets at the request of its chairman, two of its members, or the chairman
of the Company's board of directors.
The audit committee can hear all members of the Company's board of directors and perform all
internal and external audits on all subjects which it considers appropriate to its duties. The chairman of
the audit committee shall inform the board of directors of such hearing beforehand. In particular, the
audit committee may hear people who contribute to the financial reporting or auditing process
(administrative and financial director, and main officers of the financial department).
The audit committee hears the statutory auditors. It may hear them without any Company
representatives being present.
16.3.6.1.4 Reports
The chairman of the audit committee ensures that the committee's summary reports to the general
shareholders' meeting enable the latter to be fully informed, thereby facilitating its deliberations.
The annual report shall include a summary of the committee's activities during the fiscal year ended.
If, in the course of its work, the audit committee identifies a material risk which does not appear to be
dealt appropriately, the committee's chairman shall inform the chairman of the board of directors of
said risk without delay.
16.3.6.2 Appointment and compensation committee
16.3.6.2.1 Composition
By decision of the board of directors on 26 May 2014, the Company set up an appointment and
compensation committee. The members of this committee set out their committee's operating rules in
the internal rules of procedure approved by the board of directors on 26 May 2014. The main terms of
the appointment and compensation committee's internal rules are described below.
Wherever possible, the appointment and compensation committee comprises at least two members of
the board of directors, appointed by the latter. Furthermore, wherever possible, the majority of its
members are independent members.
It is specified, where appropriate, that no director performing management duties within the Company
can be a member of the appointment and compensation committee.
At the date of this document de base, the members of the appointment and compensation committee
were as follows:


the company Idinvest Partners, director, represented by Mr Benoist Grossmann, and
the company Ventech, director, represented by Mr Alain Caffi.
171
16.3.6.2.2 Duties
The appointment and compensation committee is responsible in particular for:


in terms of appointments:

presenting recommendations on the composition of the board of directors and its
committees to the board of directors;

proposing to the board of directors, on a yearly basis, the list of its members who may be
qualified as "independent members" in accordance with the criteria set out by the
Corporate Governance Code for Small and Medium Capitalization Companies, as
published by MiddleNext in December 2009 and approved as a reference code by the
AMF;

preparing a succession plan for the Company's executives and helping the board of
directors to appoint and assess the executives;

preparing a list of people who may be recommended as directors; and

preparing a list of members of the board of directors who may be recommended as
members of a committee of the board of directors.
in terms of compensation:

assessing the main objectives proposed by general management in terms of the
compensation of the Company's non-executive directors, including free share and stock
option plans;

assessing the compensation of non-executive directors, including free share and stock
option plans, pension, health and welfare schemes, and benefits in kind;

making recommendations and propositions to the board of directors regarding:

compensation, pension, health and welfare schemes, benefits in kind, and other
financial entitlements, including those of directors in the event of termination of
employment. The committee proposes compensation amounts and structures, in
particular the rules for determining the variable portion taking into account the
Company's strategy, goals and results, in addition to market practices, and

free share and stock option plans, together with any other similar profit-sharing
mechanism and, in particular, registered shares allotted to directors eligible for such a
mechanism,

assessing the total amount of attendance fees and their distribution system among
directors, together with the terms for reimbursement of expenses incurred by the members
of the board of directors;

preparing and presenting reports, where applicable, pursuant to the internal rules of the
board of directors; and

making any other recommendation which may be requested by the board of directors in
terms of compensation.
Generally speaking, the appointment and compensation committee provides any advice and
recommendations relevant to the above-mentioned issues.
172
16.3.6.2.3 Operating procedures
The appointment and compensation committee meets at least four times a year, based on a schedule
determined by its chairman and following an agenda approved by its chairman and provided to the
members of the appointment and compensation committee at least seven days before the meeting. It
also meets at the request of its chairman, two of its members, or the board of directors.
All non-executive directors who are not members of the appointment and compensation committee
may freely participate in its meetings.
If the chairman of the Company's board of directors is not a committee member, he/she may be invited
to participate in the committee meetings. The committee invites the chairman to present his/her
propositions. He/she does not have voting rights and may not attend deliberations regarding his/her
own situation.
The appointment and compensation committee may request the chairman of the board of directors to
receive assistance from any Company executive with expertise that may facilitate the handling of an
agenda item. The chairman of the appointment and compensation committee or the chairman of the
meeting must point out that any person participating in discussions must comply with confidentiality
obligations.
16.3.6.2.4 Reports
The chairman of the appointment and compensation committee ensures that the committee's summary
reports to the general shareholders' meeting enable the latter to be fully informed, thereby facilitating
its deliberations.
The annual report shall include a summary of the committee's activities during the fiscal year ended.
The appointment and compensation committee assesses in particular the Company's draft report
regarding the compensation of executives.
16.4 CORPORATE GOVERNANCE
In a bid to ensure transparency and public information, with a view in particular to the admission of its
shares to trading on the regulated market of Euronext in Paris, the Company has initiated a general
review of the corporate governance practices.
In order to comply with the requirements of article L. 225-37 of the French Commercial Code, the
Company selected the Corporate Governance Code for Small and Medium Capitalization Companies
as published by MiddleNext in December 2009 as a reference code, to which it will refer after the
admission of its shares to trading on the regulated Euronext Paris market.
The Company aims to comply with all the recommendations of the Corporate Governance Code for
Small and Medium Capitalization Companies.
At the registration date of this document de base, the Company did not comply with all the
recommendations made by the Corporate Governance Code. In particular, the Company considers that
it does not comply with the following recommendations:
-
Combination of an employment contract with a director position
The board of directors has authorised the combination of employment contracts in the Company's
subsidiaries with a director position in the Company for Dan Serfaty, chairman and chief executive
officer, and Thierry Lunati, deputy chief executive officer. See paragraph 19.1 below.
173
-
Publication of the internal rules for the board of directors
At the registration date of this document de base, the Company had not made publicly available the
internal rules which its board of directors had established on 26 May 2014, but plans to publish it on
the Company's website.
-
Assessment of the work performed by the board
To date, the Company's board of directors has not assessed its working and operating methods. Such
an assessment will be included in the board's working plan for 2014 in the form of a self-assessment.
The results will be discussed within the board and lead to the development of an action plan.
At the registration date of this document de base, the composition of the board of directors does not
comply with the MiddleNext recommendation which requires the presence of at least two independent
members when the board is composed of two members. In view of the number of directors comprising
the Company's board of directors, these committees should include two independent members, which
is not currently the case. The Company will endeavour to ensure that it complies with this point within
the coming 12 months.
16.5 CHAIRMAN'S REPORT ON INTERNAL CONTROL
At the registration date of this document de base, given that its shares were not admitted to trading on
a regulated market, the Company was not required to prepare a report on the board's composition, the
application of the principle of gender balance among its members, the conditions for preparing and
organising the work of the board of directors, and the internal control and risk management procedures
implemented by the Company, as provided by articles L. 225-37 and L. 225-68 of the French
Commercial Code.
The rules of internal control implemented within the Group will be defined by general management.
In particular, they will draw on the AMF recommendation dated 9 January 2008 and amended on 22
July 2010 ("Internal control reference framework: Implementation guide for small and medium-sized
companies") and will aim in particular to ensure the following within the Group:
- compliance with the laws and regulations applicable to the Group's subsidiaries and
establishments;
- the effective application of internal procedures, policies and directives, and best practices set
by the Group's general management;
- the safeguarding of the Group's assets;
- the reliability and sincerity of the financial and accounting information provided to corporate
bodies and published;
- the prevention and control of risks identified in relation to the Group's activities; and
- the optimisation of operating activities.
From the year ended 31 December 2014, and provided that its shares are admitted to trading on a
regulated market before the closing of this year:
-
in accordance with the provisions of article L. 225-37 of the French Commercial Code, the
chairman of the Company's board of directors will prepare a report on the board's
membership, the application of the principle of gender balance among its members, the
conditions for preparing and organising the work of the board of directors, and the internal
174
-
control and risk management procedures implemented by the Company; this report will be
included in the Company's annual report or reference document; and
once a year, the chairman of the board of directors will request members for their opinion on
the functioning of the board of directors and the preparation of its work. This discussion will
be included in the minutes of the meeting.
However, at the registration date of this document de base, the Company had internal control
procedures relative to the reliability of accounting and financial information:
To ensure the sustained increase of business activities through organic and external growth, the
Company will strengthen its financial and accounting teams in France and abroad, in order to:
- monitor the financial statements issued by the Group's subsidiaries;
- strengthen the application of financial and internal control procedures implemented
throughout the Group;
- speed up the production and analysis of the main performance and control indicators
implemented within the framework of monthly reports.
The teams at headquarters also supervise and assist with the preparation of financial statements for
each of the Group's companies and each business activity.
Ad hoc financial audits are conducted at the subsidiaries during the year in order to ensure reliable
management forecasts and financial closing. This auditing function is currently performed by the
Group's administrative and financial director.
Likewise, the Company may call on external experts if certain issues (accounting and tax issues, for
example) require a particular skill for calculating or selecting the method most suited to presenting the
relevant financial information.
The Company produces all the financial statements for its French and foreign companies internally.
However, the most significant companies (France, China, USA, Russia and Morocco) are assisted by
local experts where necessary.
IFRS compliance is ensured internally with the support of experts from well-known accounting firms.
The main options for closing the parent company (France and abroad) and consolidated financial
statements are described and shared with the statutory auditors before the fiscal year end.
With a view to the admission of its shares to trading on the regulated Euronext Paris market, the
Company wishes to continue to implement measures to develop a risk identification and assessment
system and the related control procedures.
175
17 EMPLOYEES
17.1 HUMAN RESOURCES
17.1.1 Business organisation chart at 1 April 2014
D. Serfaty
Co-founder and chairman
and CEO
IT
T. Lunati
Co-founder and
deputy CEO
Product
Strategy and dev.
O. Fecherolle
Special projects
A. Burgaud
A. Messas
China
(1)
IT/Product
Mobile
Marketing
Sales
D. Ling
Russia & Africa
Finance
and HR(2)
(3)
P. Crosby
Sales
Finance
JP Alvès
HR
S. Coffe
Marketing
C. Fouquerand
-
Hiring solutions
Marketing solutions
-
Legal
General services
Accounting
Internal IT
Controlling
-
HR development
Internal communication
HR administration
-
B2B Marketing
Product marketing
Member relations
Editorial compliance
Business analytics
(1) China has dedicated technical, operational and support resources.
(2) The Chinese Finance and HR divisions report operationally to Mr Derek Ling and functionally to Mr Jean-Paul
Alvès and Ms Stéphanie Coffe.
(3) Staff comprised solely of technical functions, use of Group resources for other departments.
176
17.1.2 Biographies of non-executive directors(dirigeants
sociaux)/members of the management team
non-mandataires
In addition to the members of the board of directors, whose biographies are presented in section 14.1
of this document de base, the biographies of the members of the management team are presented
below:
Jean-Paul Alvès, chief financial officer. Jean-Paul has worked in several roles
in multinational companies. He began as an auditor at Ernst & Young in 1996.
In 2002, he was appointed international financial controller to the senior
management of Lagardère Services, before becoming financial director at AOL
France (part of the Time Warner group) from 2002 to 2007, then associate
director at BC Consulting for one year, before joining Viadeo as chief financial
officer in 2008. Jean-Paul is a graduate of the Ecole de Management in Lyon,
Harvard University (Postgraduate degree in Managerial Accounting) and the
Université de Paris 2 - Panthéon Assas.
Agnès Burgaud, chief corporate mission officer. Agnès is responsible for
assisting the CEO with a wide variety of tasks that range from organisational
aspects to implementing aims and targets and promoting the Company’s
corporate culture, all within the context of growth. Her knowledge of the
Company’s inner workings and diverse skill set allow her to work in a wealth of
different areas. In 2010, Agnès became Viadeo’s chief people officer, leading
the company’s HR and internal communications teams, after previously joining
Viadeo at its outset as chief business development officer responsible for new
B2B revenue lines, notably launching the Recruiter Space. Before working for
Viadeo, Agnès was sales director at Forlog, an IT training specialist, having
similarly joined the company early in its history and where she was responsible
for setting up and implementing the company’s new corporate commercial
strategy.
Stéphanie Coffe, chief people officer. Reporting directly to Dan Serfaty, CEO
and co-founder of Viadeo, Stéphanie manages and oversees the Company’s
Human Resources Management teams worldwide, dealing with hiring, training,
skills development, expertise management, and internal communications, etc.
Before working for Viadeo, Stéphanie was HR director at Lacoste and
previously held the same position at DaimlerChrysler Services Fleet
Management, a wholly-owned subsidiary of the DaimlerChrysler group.
Peter Crosby, chief emerging market officer. Peter is in charge of Viadeo
membership and revenue growth in emerging countries. Since his arrival at the
Company in 2008, Peter has held several roles including that of chief sales
officer, which saw him oversee the growth and development of B2B revenue
lines, chief operations officer for Viadeo’s European division, and director of
UK and Irish operations – a position that saw him double the member base in
these countries in just one year. Peter came to Viadeo from j4b, a research and
publishing company in the area of business funding, where he set up and
expanded the company’s advertising and software lines. He has a BA (Hons) in
Linguistics and English Literature from Bangor University, Wales.
177
Olivier Fécherolle, chief strategy & development officer. Olivier collaborates
with Dan Serfaty in creating, sharing, executing, and supporting strategic
initiatives, as well as promoting a corporate culture driven by KPIs. Having
joined Viadeo in 2008, Olivier has previously held the roles of chief operating
officer responsible for French operations and chief communications and
business development officer within the Company. Prior to his arrival at Viadeo,
Olivier was involved in founding French recruitment site Keljob.com in 2000, a
company of which he was the COO. Subsequently, having seen strong growth
and having successfully merged with Cadremploi.fr, he went on to oversee the
company’s IPO in Paris in 2007 under the name of AdenClassifieds. Previously,
he spent seven years working in the auto industry. Olivier has a BA from Ecole
Supérieure de Commerce (Reims Management School) and an MA in Human
Resources from the Institut d’Administration des Entreprises Paris 1 Sorbonne.
Claire Fouquerand, chief marketing officer. Claire's primary objectives are to
strengthen Viadeo’s brand identity while also increasing member commitment
and satisfaction. In order to do this, Claire’s duties include implementing
targeted online and offline communications strategies, developing strategic
partnerships, and supporting sales team activities. Before being appointed CMO,
Claire worked as Viadeo’s director of member marketing & operations upon her
arrival at the Company in February 2013. During her career, Claire has amassed
a wealth of expertise in CRM, marketing strategy, web analytics, and digital
marketing. Prior to joining Viadeo, she spent three years (from 2010 to 2013) at
Redcats, the world’s leading e-tailer of fashion, sport, leisure and home décor
products, where, as director of customer innovation, she was in charge of
developing the group’s marketing activities, both in France and further afield.
Key wins include creating Big Data product recommendation algorithms and an
iPhone application based on those recommendations. Prior to Redcats, Claire
held various CRM positions in the Luxury & Cosmetics industries before
starting her own consulting firm and an e-commerce site. Claire is a graduate of
the ENSAE (France’s National School of Statistics and Economic
Administration) and holds an MBA from HEC (Hautes études commerciales de
Paris) where she specialised in marketing.
Ariel Messas, chief information officer. Ariel Messas has been Viadeo’s chief
information officer since the Company’s inception. He is responsible for global
projects, strategic partnerships, mergers and acquisitions, and integrations
designed to accelerate Viadeo’s growth in key target markets. Previously, Ariel
founded D.A.N.E Consulting, a technical consultancy service focused on server
architecture and network development that counts AXA France, Volkswagen
France and Crédit Agricole among its many clients. Ariel holds a joint degree in
Physics and IT from the Université Louis Pasteur in Strasbourg.
178
17.1.3 Number and breakdown of workforce
The Group's average workforce changed as follows:
Group average workforce
Product and Development Division
Sales
Marketing
Finance
Mobile
Human Resources
Management and other
Group total
Breakdown by country:
France
United States
China70
Russia
Europe (UK, Italy, Spain)
India
Africa
Mexico
Group total
2013
196
120
39
32
33
16
11
447
2012
181
111
43
24
9
16
6
390
238
16
151
20
2
14
6
0
447
213
12
114
0
19
26
4
2
390
(70) 90% of Tianji Group employees are employed by Boren
The Group seldom uses temporary workers (once in 2013).
17.1.4 Staff representatives
The Company has a CHSCT (Health, Safety and Working Conditions Committee) appointed in
August 2013, a Works Council elected on 22 January 2014 and comprised of five members, five
substitute members, and two staff representatives.
The Company believes that it maintains good relations with staff representatives and employees.
179
17.2 SHAREHOLDINGS AND STOCK OPTIONS OF DIRECTORS AND EXECUTIVES
As of the date on which this document de base was filed, the direct and indirect shareholdings of the members of the board of directors and the number of
securities they hold giving access to the share capital of the Company were as follows:
Weighted
average
2013
BCE 05
BCE 05
Date of shareholders' meeting
29-June-12
29-June-12
Date of board of directors' meeting
Number of entitlements granted to
the 10 non-director Group
employees whose number of
entitlements granted is the highest
(total number)
17-Dec-13
18-June-13
1,735
2,305
price
Number of entitlements
exercised/acquired/waived by the
10 non-director Group employees
whose number of entitlements is the
highest (total number)
(1)
-
€7.63
(1)
Weighted
2012
Weighted
average
BCE 05
average
BCE 04
BCE 04
BCE 04
BCE 04
None
30-June-10
30-June-10
30-June-10
30-June-10
None
5-July-11
18-Oct-11
14-Dec-11
29-Dec-11
price
120 BCE 02, 69 BCE 03
and 26 BCE 04 granting
entitlement to subscribe
for 5,375 shares(1)
2011
price
-
None
-
3,975
480
760
940
€6.69(1)
630 BCE
02 granting
entitlement
to
subscribe
for 15,750
shares(1)
None
None
None
None
None
After taking into account the 25-for-1 stock split decided by the general shareholders’ meeting of 21 May 2014.
The main characteristics of each of the Founders warrant (BSPCE) plans are presented in section 21.1.4.1 of this document de base.
180
17.3 SHAREHOLDINGS AND FOUNDERS'
DIRECTORS (MANDATAIRES SOCIAUX)
WARRANTS
AWARDED
TO
As of the date on which this document de base was filed, the direct and indirect shareholdings of the
directors and the number of entitlements and securities they hold giving access to the share capital of
the Company were as follows:
Securities giving access to share
capital
Number of
Number and
shares liable
type of
to arise from
securities
their
awarded(2)
exercise(1) (2)
Number
of
shares(1)
% of capital and
voting rights
Total fully
Total
diluted on
held at
first
present
trading
day(6)
Total(1)
18
Members of the board of directors
Dan Serfaty (CEO)
Thierry Lunati (deputy
CEO)(4)
AV3(4)
Idinvest Partners
(4)
Ventech(4)
Derek Ling
CBC(5)
(China Biztnework Corp)
Financière WM
(Stone Group)
BPI France Participations
(formerly FSI)
A CAPITAL Management
S.A.
14,233 BCE 01
355,825
2,500 BCE 05
62,500
14,233 BCE 01
355,825
2,500 BCE 05
62,500
1,316,350
-
1,109,800
25(3)
418,350
0.00%
4.49%
760,650
4.34%
8.17%
-
1,316,350
16.70%
14.14%
-
-
1,109,800
14.08%
11.92%
970,875
-
-
970,875
12.31%
10.43%
-
500 BCE 03
12,500
12,500
0.00%
0.13%
1,124,825
-
-
1,124,825
14.27%
12.08%
104,900
-
-
104,900
1.33%
1.13%
524,500
-
-
524,500
6.65%
5.63%
-
-
-
-
-
342,325
-
(1) The data takes into account the 25-for-1 stock split decided by the combined general shareholders’
(2) A detailed breakdown of these securities and entitlements is given in section 15.3 "Founders warrants
(BSPCE), warrants (BSA) and other securities giving access to share capital awarded to directors and
executives" above and a detailed description of the terms of each of these plans is given in section
21.1.4 “Securities giving access to a percentage of the share capital" of this document de base.
(3) Dan Serfaty directly owns 25 Company shares under a securities loan granted on 22 June 2006 by Ms
Karen Serfaty.
(4) Taking into account the exercise in May 2014 of the call option agreement granted by some of the
Company's shareholders as described in more detail in section 21.1.6 of this document de base.
(5) Viadeo owns 9.55% of the CBC shares following the subscription to two capital increases of $5.1
million in 2007, prior to the Group's acquisition of the Tianji platform. Viadeo plays no role in the
management of CBC and has no significant influence, given the shareholding structure of CBC, which
is liable to guide the decisions that may be taken by the partners.
(6) Not taking into account the conversion of Convertible Bonds into shares held on the date this document
de base was filed, as described in section 21.1.4.2 (the conversion conditions being dependent on the
issue price, which was not known on the date this document de base was filed).
The main characteristics of each of the Founders warrant (BSPCE) plans are presented in
section 21.1.4.1 of this document de base.
181
17.4 EMPLOYEE SHARE OWNERSHIP
Taking into account the exercise in May 2014 of the call option agreement granted by some of the
Company's shareholders as described in more detail in section 21.1.10 of this document de base, the
amount of Company share capital owned by employees currently stands at 0.03%.
17.5 EMPLOYEE PROFIT SHARING AND INCENTIVE AGREEMENTS
None.
182
18 MAIN SHAREHOLDERS
18.1 BREAKDOWN OF CAPITAL AND VOTING RIGHTS AT 30 APRIL 2014
The detailed table below presents the shareholding structure and breaks down the Company's share
capital and voting rights at the registration date of this document de base (on a diluted and non-diluted
basis). It takes into account the conversion of all preferred shares into ordinary shares on the day of the
initial listing of the Company's shares on the regulated Euronext Paris market, on the basis of one
ordinary share for one preferred share.
Position at the registration
date of this document de base
on a non-diluted basis
Number of shares
(1) (2)
% of
capital*
Position at the registration date of
this document de base on a fully
diluted basis (15)
Number
Founders'
of shares
warrants
after
(BSPCE)
exercise
% of
outstandin
of the
capital*
g but not
founders'
yet
warrants
exercised
(BSPCE)(1
) (2)
Dan Serfaty (CEO)
Karen Serfaty(2) (3)
Dan Serfaty family sub-group(3)
Thierry Lunati (deputy CEO)(2)(4)
25
358,925
358,950
342,325
0.00%
4.55%
4.55%
4,34%
16,733
Founders and related parties(5)
701,275
8.90%
AV3 (formerly AGREGATOR)
Idinvest Partners(2)(7)
Ventech(2)(8)
AFV2 Investissement(2) (6) (9)
BPI France Participations (formerly
FSI)
CREADEV(2)
PGA Invest(2) (10)
Allianz Vie
Other financial investors(2)(11)
1,316,350
1,109,800
970.875
359,275
Financial investors
(2) (6)
CBC (China Biznetwork Corp)
Unyk Holding
ApnaCircle shareholders
Soocial shareholders
(12)
Other investors(13)
Natural persons(2)(14)
16,733
16,733
418,350
358.925
777,275
760,650
4.49%
3.85%
8.35%
8.17%
33,466
1,537,925
16.52%
16.70%
14.08%
12.31%
4.56%
1,316,350
1,109,800
970,875
359,275
14.14%
11.92%
10.43%
3.86%
524,500
6.65%
524,500
5.63%
221,200
226,500
104,900
538,625
2.81%
2.87%
1.33%
6.83%
221,200
226,500
104,900
538,625
2.38%
2.43%
1.13%
5.78%
5,372,025
68.14%
5,372,025
57.69%
1,124,825
277,925
202,125
41,200
14.27%
3.53%
2.56%
0.52%
1,124,825
277,925
202,125
41,200
12.08%
2.98%
2.17%
0.44%
1,646,075
20.88%
1,646,075
17.68%
23,650
755,700
8.12%
57,116
9,311,725
100.00
%
164,450
2.09%
100.00
%
*The percentage of voting rights is identical to the percentage of capital held.
Total
7,883,825
183
(1) The figures shown take into account the 25-for-1 stock split approved by the combined shareholders'
(2) Taking into account the exercise, in May 2014, of the call option granted by some of the Company's
shareholders as described in greater detail in section 21.1.6 of this document de base.
(3) In addition to this direct interest, NOUCHKA (92.40% controlled by Karen Serfaty) has an indirect
interest via a 12.45% interest in AV3, which itself has a 16.70% capital interest in the Company.
(4) In addition to this direct interest, MARLU (45% controlled by Thierry Lunati) has an indirect interest
via a 23.38% interest in AV3, which itself has a 16.70% capital interest in the Company.
(5) Taking into account the factors indicated in Notes 3 and 4 above, the founders and related parties hold
a total of 990,609 shares directly or indirectly, i.e. 12.57% of the Company's share capital on a nondiluted basis and a total of 1,827,259 shares, i.e. 19.62% of the Company's share capital on a fully
diluted basis.
(6) These holding companies will disappear in the months following the Company's IPO in favour of direct
holdings in the Company's share capital by their respective current shareholders.
(7) Capital interest held via 18 innovation mutual funds and one management company.
(8) Capital interest held via one management company and one venture capital mutual fund.
(9) AFV2 is a holding company which groups together Viadeo's historic shareholders. It was created
during the Company's first funding round in June 2006 in order to simplify Viadeo's equity structure. It
currently has 26 shareholders. The founders and related parties do not own any shares (directly or
indirectly) in this holding.
(11) Among which no individual investor holds more than 2.03% of the Company's share capital. However,
since acquiring a stake in the Company in April 2012, Jefferies International Limited has a 1.46%
interest in the Company's share capital and voting rights.
(12) Viadeo holds 9.55% of the shares in CBC as a result of the subscription for two $5.1 million capital
increases in 2007, prior to the Group's acquisition of the Tianji platform. Viadeo does not have any
other management role within CBC and, in view of CBC's shareholder structure, does not have any
significant influence likely to influence any decision which might be taken by the partners.
(13) Companies, funds or natural persons who have become Company shareholders as a result of various
acquisitions made by the Group (primarily bond conversions and repayments of contributions in kind
made in Viadeo shares).
(14) The number of shares on a non-diluted basis primarily concerns the Company's former employees
having exercised their founders' warrants (BSPCE).
(15) The figures included in the "On a fully diluted basis" column are provided on the basis of fully diluted
capital, i.e. assuming the full exercise of outstanding founders' warrants (BSPCE) excluding the
conversion of convertible bonds described in chapter 21.1.4.2 (the conditions for conversion being
determined by the initial listing price which was unknown at the registration date of this document de
base).
184
18.2 SIGNIFICANT SHAREHOLDERS NOT REPRESENTED ON THE BOARD OF
DIRECTORS
At the registration date of this document de base, AFV2 Investissement held 4.56% of the Company's
share capital and voting rights and was not a Company director.
18.3 VOTING RIGHTS OF THE MAIN SHAREHOLDERS
At the registration date of this document de base, the voting rights of each shareholder were equal to
the number of shares held by each of them. Double voting rights have not been authorised. Any
mechanism by which a double voting right would automatically be conferred in respect of registered
shares held in the name of the same shareholder for at least two years is expressly waived by the
Company’s bylaws.
18.4 COMPANY CONTROL
At the registration date of this document de base, the Company had no controlling shareholder under
the meaning of the provisions of Article L. 233-3 of the French Commercial Code.
The Company has not implemented any measures to ensure that its control could not be exercised in
an abusive fashion.
A shareholders' agreement has been signed and will become null and void upon admission of the
Company's shares to trading on the regulated Euronext Paris market.
To the Company's knowledge, there is no concert agreement between shareholders.
18.5 AGREEMENT THAT MAY LEAD TO A CHANGE OF CONTROL
No particular aspect of the memorandum, bylaws, charter or regulations of the issuer may lead to the
delay, deferment or prevention of a change of control.
18.6 SECURITY INTERESTS
Mr Yogesh Bansal has pledged as security 7,200 shares which he holds in the Company's capital (this
number of shares take into account the 25-for-1 stock split approved by the general shareholders'
meeting on 21 May 2014) in favour of its subsidiary Wayson Technology Development Ltd as
security against the repayment of a loan which had been granted to him by the latter on 31 December
2008. At the registration date of this document de base, the loan amount remaining to be repaid
amounted to USD 197,044 (i.e. USD 160 thousand in principal and USD 37,044 in interest).
With the exception of the above-mentioned pledged shares, which account for less than 0.1% of the
Company's share capital and voting rights at the date of this document and to the Company's
knowledge, none of its other shares has been pledged.
185
19 TRANSACTIONS WITH RELATED PARTIES
19.1 AGREEMENTS WITH EXECUTIVES
In addition to the two service agreements described in section 16.2 of this document de base and
covered in the statutory auditors' special reports presented in section 19.3, three employment contracts
were entered into with the Company's executives and certain Group entities.
Employment contracts entered into between Mr Dan Serfaty and the Group entities.
Mr Dan Serfaty entered into an employment contract with the Chinese sub-subsidiary Boren
Technology Development Co. in Beijing on 1 September 2011 for an indefinite period as operations
director. This contract may be terminated by either party subject to 30 days' notice. Under the terms of
this contract, in addition to his salary, Dan Serfaty is granted a housing allowance and is bound to an
obligation not to solicit or poach critical people (the Group's employees or customers over the last 12
months preceding the date of termination of office).
Mr Dan Serfaty entered into an employment contract with the Hong Kong subsidiary WaysonKong on
1 September 2011 for an indefinite period as operations director. This contract may be terminated by
either party subject to 30 days' notice, except in cases of misconduct, where no notice is required.
Employment contract entered into between Mr Thierry Lunati and the American subsidiary
APVO.
Mr Thierry Lunati entered into an employment contract with the American subsidiary APVO on 10
January 2011 for an indefinite period as technical director. This contract may be terminated by either
party without notice.
19.2 AGREEMENTS WITH SHAREHOLDERS
On 27 October 2011, the Company granted a loan of $75,150 at an interest rate of 5% per year to CBC
(ChinaBizNetwork Corp.), a 14.27% shareholder of Viadeo. This loan must be reimbursed upon the
dissolution of CBC or initial public offering of Viadeo.
19.3 STATUTORY AUDITORS' REPORT ON THE REGULATED AGREEMENTS
PREPARED FOR THE YEAR ENDED 31 DECEMBER 2013
This is a free translation into English of a report issued in French and is provided solely for the convenience of Englishspeaking readers. This report should be read in conjunction with, and is construed in accordance with, professional auditing
standards applicable in France.
"Statutory auditors’ report on regulated agreements
Viadeo S.A.
Annual general meeting for approval of the accounts for the year ended 31 December 2013
To the Shareholders,
In our capacity as statutory auditors of your company, we hereby present our report on the regulated
agreements.
186
It is our responsibility to report to you, based on the information provided to us, the principal terms
and conditions of these agreements brought to our attention or which we may have identified as part of
our engagement, without expressing any opinion on their usefulness or their merit or searching for
other agreements. It is your responsibility, pursuant to article R.225-31 of the French Commercial Law
(“Code de commerce”), to assess the interest of entering into these agreements with a view to
approving them.
.
Where applicable, it is our responsibility to report to you the information pursuant to article R.225-31
of the French Commercial Law relating to continuing agreements already approved by the
Shareholders’ meetings in previous years..
We performed the procedures that we considered necessary in accordance with French professional
guidance issued by the “Compagnie Nationale des Commissaires aux Comptes” (National Association
of Statutory Auditors), relating to this engagement. Our work consisted in verifying that the
information provided to us is in agreement with the underlying documentation from which it was
extracted.
1.
Agreements to be submitted for the approval of the shareholders' general meeting
Pursuant to Article L. 225-86 of the French Commercial Law, we have not been advised of any
agreement or commitment entered into by the Company during the year ended 31 December 2013, to
be submitted for the approval of the shareholders’ general meeting.
2.
Agreements and commitments already approved by the shareholders' general meeting
Pursuant to article R. 225-30 of the French Commercial Law, we have been informed of the following
agreements, which were already approved by the shareholders' general meeting in previous years, and
which were applicable during the year.
2.1
Agreement with the company Kadomi
Pursuant to the service contract signed on 1 October 2006 and its amendment of 30 June 2010, an
amount of €.322,000 has been billed by Kadomi to your company, for the fiscal year 2013, for
technical and functional services provided for the development of www.viadeo.com website. This
amount excludes taxes and outlays / business expenses, the reimbursement of those expenses based on
the actual cost is not material.
Director concerned:
Mr Thierry Lunati, VIADEO deputy Chief Executive Officer, and Director.
2.2
Agreement with the company KDS
Pursuant to the technical assistance agreement signed on 15 December 2005 and its amendment of 1
August 2010, an amount of €.185,500 has been billed by KDS to your company for year 2013. This
amount excludes taxes and outlays / business expenses, the reimbursement of those expenses based on
the actual cost is not material.
Director concerned:
Mr Dan Serfaty, VIADEO Chairman of the Board of Directors, and Director.
187
2.3
Agreement with the company China Biznetwork Corporation
On 27 October 2011, your company granted China Biznetwork Corporation a loan of USD 75,150 at
an interest rate of 5% per annum. This loan must be reimbursed upon the liquidation or initial public
offering of your company.
Directors concerned:
-
Mr Dan Serfaty, VIADEO Chairman of the Board of Directors, and Director;
-
Mr Derek Ling, VIADEO Director;
-
China Biznetwork Corporation, represented by Bill Melton, VIADEO Director”
Paris La Défense and Paris, 25 April 2014
KPMG Audit IS
Jean-Pierre Valensi
Partner
Grant Thornton
Vincent Frambourt
Partner
Since the statutory auditors prepared their special report for 2013, no new regulated agreement has
been submitted for authorisation by the board of directors.
188
20 FINANCIAL INFORMATION CONCERNING THE ASSETS, FINANCIAL POSITION
AND PROFIT ANDLOSS OF THE ISSUER
20.1 CONSOLIDATED ACCOUNTS PREPARED IN ACCORDANCE WITH IFRS
FOR THE FISCAL YEARS ENDED 31 DECEMBER 2013 AND 2012
The present document de base was drawn up on the basis of schedule XXV of Delegated Regulation
(EU) No. 486/2012 of March 2012 (SME scheme) and accordingly provides verified historic
information for the last two fiscal years.
I.
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
Amounts shown are in thousands of euros.
The accompanying notes are an integral part of these statements.
31 December
2013
ASSETS
Non-current assets
31 December
2012
1 January
2012
Note
No.
23 210
20 014
16 392
Goodwill
5 219
5 360
5 423
3
Intangible assets
7 827
7 141
7 761
4
Property, plant and equipment
1 287
1 328
1 133
5
1 786
1 505
1 412
7
Non-current tax receivable
1 631
739
663
7
Deferred tax assets
5 460
3 941
0
22
11 435
25 434
9 162
6 223
5 857
5 145
8
614
637
441
8
0
671
6
4 597
18 269
3 570
34 645
45 448
25 554
Current assets
Trade and other receivables
Other current assets
Tax asset - current
Cash & cash equivalents
TOTAL ASSETS
31 December
2013
LIABILITIES
Share capital
Share premiums
31 December
2012
1 January
2012
10 511
23 108
5 043
110
110
92
9
Note
No.
11
44 153
44 112
21 759
(33 752)
(21 114)
(16 808)
-
-
-
2 506
2 906
3 887
1 072
1 421
2 574
12
Provisions
330
120
85
13
Deferred tax liabilities
312
449
632
22
792
916
597
15
21 628
19 434
16 624
10 282
9 358
7 163
14
2 473
560
2 215
12
675
290
13
13
Reserves and retained earnings
Non-controlling interests
Current liabilities
Trade and other payables
Current provisions
Tax liability
189
69
50
32
8 129
9 176
7 200
34 645
45 448
25 554
15
II.
CONSOLIDATED INCOME STATEMENT
31 December
2013
31 December
2012
15 793
15 938
8 812
7 537
4 958
3 916
Other income
1 355
342
2.21
30 917
27 733
16
(23 174)
(19 399)
(5 413)
(3 089)
17
(11 009)
(9 537)
Other recurring expenses and operating income
18
418
637
(8 261)
(3 655)
(972)
(798)
93
(102)
(5 284)
(3 756)
(14 424)
(8 310)
(92)
(257)
-
-
(92)
(257)
(14 516)
(8 567)
Consolidated statement of net income (loss) - euros 000
Notes
Staff expenses
Operating margin
Share-based payments reserved for staff
11
Depreciation of current assets
Amortization and provisions expenses
19
Recurring operating profit (loss)
Other operating expenses
Other operating income
Non recurring operating profit (loss)
20
210
269
(439)
(484)
(229)
(216)
Share in net income of associate companies
-
-
Other income and expenses
-
-
Net profit (loss) before tax
(14 745)
(8 783)
1 624
3 974
Profit (loss) from continuing operations
(13 121)
(4 809)
NET PROFIT (LOSS) FOR THE YEAR
(13 121)
(4 809)
(13 121)
(4 809)
-
-
Financial income
Financial expenses
21
Income tax benefit (charge)
22
Attributable to
the Company's owners
Basic earnings (loss) per share (€/share)
25
(41,61)
(16,12)
Diluted earnings (loss) per share (€/share)
25
(41,61)
(16,12)
190
III.
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
31 December
2013
31 December
2012
(13 121)
(4 809)
Items which will not subsequently be reclassified to profit and loss:
17
(27)
Revaluation of net liabilities relating to defined benefit plans
17
(27)
0
0
Items which may subsequently be reclassified to profit and loss:
(466)
(235)
Exchange differences from converting foreign business establishments
(466)
(235)
-
-
(13 569)
(5 071)
Consolidated statement of comprehensive income (loss) - euros 000
Net profit (loss) of the consolidated group
Other components of comprehensive income (loss)
Corporation tax on items which will not subsequently be reclassified
Corporation tax on items which may subsequently be reclassified
TOTAL COMPREHENSIVE INCOME (LOSS) FOR THE FINANCIAL YEAR
191
IV.
STATEMENT OF CHANGES IN EQUITY
(euros 000)
Note
BALANCE at 1 January 2012
Share
capital
Reserves
Total equity
Currency
Share
and
attributable to
translation
premiums consolidat
the Company’s
differences
ed income
shareholders
Noncontrolling
interests
Total
equity
92
21 759
(17 419)
610
5 043
-
5 043
Profit (loss) for the period
-
-
(4 809)
-
(4 809)
-
(4 809)
Change in translation differences, net of tax
Revaluation of defined-benefit obligation
Total comprehensive profit (loss)
-
-
0
(27)
(4 836)
(235)
(235)
(235)
(27)
(5 071)
-
(235)
(27)
(5 071)
18
18
22 352
22 352
(0)
798
(33)
765
-
22 370
798
(33)
23 136
-
22 370
798
(33)
23 136
110
44 112
(21 490)
375
23 108
-
23 108
-
-
(13 121)
-
(13 121)
-
(13 121)
0
0
(0)
(0)
41
41
(0)
17
(13 103)
0
972
(41)
931
(466)
(466)
0
0
(466)
17
(13 569)
41
972
(41)
973
-
(466)
17
(13 569)
41
972
(41)
973
110
44 153
(33 661)
(91)
10 511
-
10 511
Entry into consolidation scope
Dividend distributed by the consolidating entity
Capital increase
Other changes
Total transactions with the company's owners
11
11
BALANCE at 31 December 2012
Change in translation differences, net of tax
Revaluation of defined-benefit obligation
Total comprehensive profit (loss)
Entry into consolidation scope
Distribution by the consolidating entity
Capital increase
Other changes
Total transactions with the company's owners
BALANCE at 31 December 2013
11
11
192
V.
STATEMENT OF CASH FLOWS
Amounts shown are in thousands of euros.
Statement of consolidated cash flows
Of which net profit/loss from operations discontinued or being discontinued
Of which net profit/loss from continuing operations
Adjustments for:
Depreciation, amortization and provisions (excluding for current assets)
31 December
2013
31 December
2012
(13 121)
(4 809)
(13 121)
(4 809)
5 035
4 007
Elimination of income from disposals and dilution gains and losses
304
177
Share-based payment transactions
972
798
11
75
Gains and losses related to fair value
-
-
Share in net income + impairment of investments in associated companies
-
-
(0)
(20)
Gains and losses related to discounted future value
Other income and expenses with no impact on cash flow
(6 798)
227
38
(47)
Corporate income tax expense (including deferred tax)
(1 624)
(3 975)
Cash flow before net financial income and tax from continuing operations
(8 384)
(3 794)
Cash flow after net financial income and tax from continuing activities
Cost of Net Financial debt
Tax paid
(244)
(253)
Change in operating working capital
(188)
3 085
(8 817)
(963)
Cash flow from continuing operating operations
Cash flow from operating activities for discontinued operations
I - CASH FLOW FROM OPERATING ACTIVITIES
Acquisition of PPE
Acquisition of intangible assets
Acquisition of financial assets
Disposal of PPE and intangible assets
Disposal or reduction in financial assets
Impact of changes in the consolidation scope
Net cash flow from investing activities for continuing activities
(8 817)
(963)
(875)
(1 257)
(5 126)
(2 882)
(337)
(153)
3
430
21
188
(11)
-
(6 325)
(3 675)
(6 325)
(3 675)
41
22 370
Net cash flow from investing activities for discontinued operations
II - NET CASH FLOW FROM INVESTING ACTIVITIES
Capital increase
-
Acquisition/disposal of treasury shares
-
-
New borrowings
2 132
573
Loan repayment (including finance lease agreements)
(574)
(3 340)
Dividends paid
Net financial interest paid (including finance lease agreements)
Net cash flow from (used in) financing activities for continuing operations
(39)
(91)
1 561
19 513
1 561
19 513
(13 581)
14 876
Net cash flow from (used in) financing activities for dicontinued operations
III - NET CASH FLOW FROM (USED IN) FINANCING ACTIVITIES
CHANGE IN NET CASH (I) + (II) + (III)
Cash at the beginning of the period (including activities discontinued or being discontinued)
Change in continuing activities
Impact of changes in foreign exchange rates
CASH BALANCE AT YEAR-END
18 268
3 488
(13 581)
14 876
(94)
(95)
4 593
18 269
4
-
Cash and cash equivalents at the end of the period
4 597
18 269
of which cash flow from continuing activities
4 597
18 269
Current bank overdrafts
of which cash flow from operations discontinued or being discontinued
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NOTES TO THE FINANCIAL STATEMENTS
(Unless otherwise indicated, the amounts stated in this appended note are in thousands of euros).
Note 1: Presentation of activities and highlights
1.1 Information about the Company and its business
The Viadeo Group owns and manages professional social networks consisting of nearly 60 million
members worldwide.
The Group was founded in 2005 by Dan Serfaty and Thierry Lunati and currently revolves around two
brands: Viadeo in the international market and Tianji in China.
The Group’s business model consists of making tools and social networks available to professionals to
improve their career prospects, seek business opportunities, find new contacts and create effective
online identities. The Group has three sources of revenue: premium subscriptions sold to professionals
(Online Subscriptions/OS), recruitment tools and services sold to corporate clients (Hiring Solutions),
and advertising space and marketing services sold to corporate clients (Marketing Solutions).
1.2 Highlights
1.2.1
Highlights in 2012
The highlights for the period were as follows:
 in the course of the fiscal year, Viadeo SA carried out a capital increase by issuing 50,871 new
shares with a face value of €0.35 and a unit share premium of €476.31. Share issuance
expenses amounted to €1,983,354 and were accounted for against the share premium. The
transaction led to an increase in equity of €22,264,817;
 during the fiscal year, the Viadeo Group estimated that the taxable profit of its U.S.-based
subsidiary, APVO, would be sufficient in the future to offset its losses carried forward and
temporary differences. The Group thus recognised deferred taxes of €3,932K (benefit) for this
subsidiary at 31 December 2012;
 on 18 December 2012, the board of directors decided for strategic reasons to close the Viadeo
Mexico, Viadeo Red Profesional and Viadeo SEHQ subsidiaries. The effects of these
dissolutions were taken into account in the financial statements at 31 December 2012;
 Viadeo SA benefited from a research tax credit amounting to €734,822.
1.2.2
Highlights in 2013
The highlights for the period were as follows:




on 18 June 2013, the board of directors decided to discontinue the ApnaCircle business in
India effective1 July 2013. It also decided to dissolve the Dakar subsidiary and to develop the
African market from the office in Casablanca, Morocco;
on 8 October 2013, the board of directors noted the exercise of 15 “BCE 02” with an issue
value of €167.35, 15 “BCE 03” with an issue value of €209.19 and 26 “BCE 04” with an issue
value of €250.35 producing a share capital increase of €19.6 (i.e. a unit face value of €0.35 per
share) and a share premium increase of €12,137.60;
on 28 February 2013, the board of directors approved the signing of a lease for new premises
in Paris at 65 rue de la Victoire. The lease was signed on 14 March 2013;
on 28 February 2013, the board of directors noted the exercise of 30 “BCE 02” with an issue
value of €167.35 and 24 “BCE 03” with an issue value of €209.19, producing a share capital
increase of €18.9 (i.e. a unit face value of €0.35 per share) and a share premium increase of
€10,022.16;
194




on 28 February 2013, the board of directors noted the exercise of 15 “BCE 03” with an issue
value of €167.35, producing a share capital increase of €5.25 (i.e. a unit face value of €0.35
per share) and a share premium increase of €2,505;
on 17 December 2013, the board of directors noted the exercise of 30 “BCE 02” with an issue
value of €167.35 and 30 “BCE 03” with an issue value of €209.19, producing a share capital
increase of €21 (i.e. a unit face value of €0.35 per share) and a share premium increase of
€11,275.20;
on 17 December 2013, the board of directors noted the exercise of 30 “BCE 02” with an issue
value of €167.35 producing a share capital increase of €10.5 (i.e. a unit face value of €0.35 per
share) and a share premium increase of €5,010;
on 17 December 2013, the board of directors noted the exercise of 405 SF warrants leading to
the subscription for 405 shares and thus increasing share capital by €141.75, i.e. a unit face
value of €0.35 per share.
1.3 Events occurred subsequent to year-end
1.3.1
Events occurred subsequent to the 2012 year-end
On 18 December 2012, Viadeo SA's board of directors approved the takeover of Zaizher, concluded
on 18 April 2013 by means of an Asset Purchase Agreement between Viadeo SA and Roosher Inc.,
and a second Asset Purchase Agreement between Tianji Boren Technology Development Co., Ltd.
and Beijing ROOSHER Technology Limited.
On 28 February 2013, Viadeo SA approved the signing of a lease for new premises in Paris at 65 rue
de la Victoire. The lease was signed on 14 March 2013.
The consolidated financial statements for the fiscal year ended 31/12/2012, prepared in accordance
with French accounting rules, do not take into account events occurring subsequent to 10 June 2013,
the date on which the accounts were authorised.
The accounting estimates made on the transition date reflect the existing conditions on the approval
date of the 2012 financial statements.
1.3.2
Events occurred subsequent to the 2013 year-end
Adoption of International Financial Reporting Standards (IFRS)
On 25 February 2014, the board of directors approved the adoption of IFRS for the consolidated
accounts at 31 December 2013.
The company decided to prepare its consolidated accounts in accordance with IFRS. Note 29 provide
information on the transition to IFRS for the opening balance at 1 January 2012 and the fiscal year
ended 31 December 2012.
Bond issue

The extraordinary general shareholders’ meeting of 27 January 2014 approved the issuance of
50,500 convertible bonds amounting to €5,050K at a unit price of €100, payable fully in cash.
The maturity date of these convertible bonds is 27 January 2019, and they become convertible
at any time from 27 July 2017. They will generate paid interest from 27 January 2015 at a rate
of 5% (payable every six months), with capitalised interest from the date of issue at a rate of
4%. The conversion parity will be calculated on the basis of a valuation performed at the time
of fund-raising or stock exchange listing to which a 25% or 30% discount will be applied
depending on the conversion period.
195

The Extraordinary General shareholders’ meeting of 21 February 2014 approved the issuance
of 5,000 convertible bonds amounting to €500 000 at a unit price of €100, payable fully in
cash. The maturity date for these convertible bonds is 21 February 2019, and they become
convertible at any time from 27 July 2017. They will generate paid interest from 21 February
2015 at a rate of 5% (payable every six months), with capitalised interest from the date of
issue at a rate of 4%. The conversion parity will be calculated on the basis of a valuation
performed at the time of fund-raising or stock exchange listing to which a 25% or 30%
discount will be applied depending on the conversion period.

The Extraordinary General shareholders’ meeting due to be held on 20 May 2014 is scheduled
to approve the issuance of 5,000* convertible bonds amounting to €500 000 at a unit price of
€100, payable fully in cash. The subscription period for each convertible bond will be five
years from the date of issuance; the bonds will become convertible at any time from from27
July 2017. They will generate paid interest starting one year from the date of issue at a rate of
5% (payable every six months),with capitalised interest from the date of issue at a rate of 4%.
The conversion parity will be calculated on the basis of a valuation performed at the time of
fund-raising or stock exchange listing to which a 25% or 30% discount will be applied
depending on the conversion period. Convertible bondholders undertake (i) not to sell any
convertible bonds until 30 June 2015, and (ii) in the event of an IPO, not to sell any shares
resulting from converted bonds for a duration representing 50% more than the one Dan
Serfaty and Thierry Lunati committed on, or in any event for a minimum of 12 months and a
maximum of 18 months. Furthermore, failing an IPO or rounds of funding or a disposal (as
defined in the contract signed on 23 April 2014), convertible bondholders will have the option
of converting their bonds into preferred shares from 1 July 2015.
Appointment of a new Chairman of the board of directors
On 25 February 2014, the board of directors appointed Dan Serfaty as Chairman and Managing
Director of Viadeo SA and Thierry Lunati as Deputy Managing Director of Viadeo SA.
Note 2: Significant accounting policies
Amounts in the financial statements are in thousands of euros unless otherwise indicated. This single
set of consolidated accounts for the 2013 and 2012 fiscal years was prepared as part of the
contemplated public offering and listing of the Company’s shares on the Euronext regulated market in
Paris.
2.1 Basis of consolidation
Statement of compliance
Viadeo has prepared its consolidated financial statements, which have been authorised by the board of
directors on 7 April 2014, in accordance with the standards and interpretations published by the
International Accounting Standards Board (IASB) and adopted by the European Union on the date of
preparation of the consolidated financial statements for all the periods presented.
These
guidelines,
available
on
the
European
Commission’s
website
(http://ec.europa.eu/internal_market/accounting/ias_fr.htm), incorporate international accounting
*
A material error appears in Note 1.3.2 to the Notes to the consolidated financial statements. Paragraph 3 of the
section “Bond issue”, indicates that the number of bonds to be issued is 50 thousand instead of 5 thousand. As
stated in Note 2.1, the nominal amount of the bond will be €5 million, i.e. 50 thousand bonds of €100 each..
196
standards (IAS and IFRS) and the interpretations issued by the Standing Interpretations Committee
(SIC) and the International Financial Interpretations Committee (IFRIC).
The accounting policies and options used by the Group are described hereafter. In certain cases, IFRS
allow a choice between a benchmark treatment and an allowed alternative treatment.
Viadeo is a first-time adopter of IFRS. Note 29 provides information on the transition to IFRS.
Basis of preparation of the consolidated financial statements
The board of directors authorised the consolidated financial statements being prepared on a going
concern basis taking into consideration the Company’s financial capacity to respond to its financing
needs for the next 12 months.
The analysis performed by the board of directors took the following into account:
 the cash position of €4.6 million at 31 December 2013;
 convertible bonds issued in January and February 2014 which generated cash flow of
€5.6 million;
 a planned convertible bonds issuance in May 2014 for €5 million.
The Company believes this will enable it to cover its needs until June 2015.
The Company’s losses over the fiscal years presented are related to the investments made in the
Chinese subsidiary and in technology to continue developing the platform.
The Group consolidated financial statements have been prepared on the historical cost basis, in
accordance with IFRS requirements, except for certain assets and liabilities which are mentioned in the
following notes.
Historical cost is generally based on the fair value of the consideration given in exchange for goods
and services.
Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in
an ordinary transaction between market participants at the measurement date, regardless of whether
this price is directly observable or estimated using another valuation technique.
When measuring the fair value of an asset or liability, the Group considers the characteristics of the
asset or liability if market participants are likely to do so when pricing the asset or liability at the
measurement date.
For measurement purposes or purposes of providing information in these consolidated financial
statements, fair value is determined on such basis, except for share-based payment transactions under
the scope of application of IFRS 2, lease operations under the scope of application of IAS17, and
measurements similar but not equivalent to fair value, such as value in use under IAS 36.
Accounting methods
In preparing its opening balance sheet, Viadeo complied with the provisions of IFRS 1 “First-time
Adoption of International Financial Reporting Standards” which covers the first-time adoption of
IFRS and exceptions to the retrospective application of IFRS.
The Group chose 1 January 2012 as transition date.
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IFRS 1 provides exceptions to retrospective application of IFRS at transition date; the Group selected
the following exceptions:
 exemption from the retrospective treatment of business combination prior to the transition
date, i.e. 1 January 2012;
 No use of the option to reassess tangible assets at their fair value at the transition date.
The accounting methods mentioned above were applied to all periods presented in the consolidated
financial statements, including or excluding the following new standards and interpretations:
Standards, amended standards and interpretations in force for the fiscal year beginning on 1
January 2013
Under its transition to IFRS, the Group applied standards, amended standards and interpretations in
force at the end of fiscal year2013 to all periods presented.
Standards and interpretations adopted by the IASB but not yet in force at 31 December 2013
The Group did not anticipate the application any of the new standards and interpretations listed below
that were not mandatory at 1 January 2013:
Standards dealing with consolidation methods:





IFRS 10 Consolidated Financial Statements,
IFRS 11 Joint Arrangements,
IFRS 12 Disclosure of Interest in Other Entities,
amendments to IFRS 10, 11 and 12 Temporary Provisions,
amended IAS 28 Investments in Associates and Joint Ventures.
Other standards and interpretations:








IFRS 9 Financial Instruments (classification and measurement),
IFRS 9 Financial Instruments (hedge accounting),
amended IAS 32 Financial Instruments: Presentation (offsetting financial assets and financial
liabilities),
changes to IAS 36 Impairment of Assets (disclosure of information on the recoverable value
of non-financial assets),
amendments to IAS 19 Employment benefits (defined benefit plans, employee contributions);
annual improvements, 2010-2012 cycle,
annual improvements, 2011-2013 cycle,
IFRIC 21 Levies.
In the consolidated accounts at 31 December 2013, the joint ventures within the Group were
consolidated using the proportional method. As of 1 January 2014, these joint ventures will be
consolidated using the equity method (IFRS 11). The share of these joint ventures in the Group’s
consolidated statement of profit or loss at 31 December 2013 is detailed in Note 6 “Joint Ventures”.
Regarding the other standards and interpretations listed above, the Group is currently analysing the
practical impact and consequences of their application.
198
2.2 Use of judgments and estimates
To prepare financial statements in accordance with IFRS, estimates, judgments and assumptions were
made by Group Management; these could have an effect on the reported amounts of assets and
liabilities, contingent liabilities at the date of preparing the financial statements, and the reported
amounts of income and expenses for the fiscal year.
These estimates were made on a going concern basis and on the basis of the information available at
the time of preparing them. They are assessed continuously based on past experience and various other
factors deemed to be reasonable, which represent the basis for assessments of the carrying amount of
assets and liabilities.
The estimates may be revised if the circumstances on which they are based change or if new
information arises. Actual results may differ significantly from these estimates based on assumptions
or different conditions.
The main estimates and assumptions used concern the assessment of the following items:





The intangible nature of and amortisation period for intangible assets regarding capitalised
research and development projects;
Equity-settled share based payment transactions: yearly assumptions for measuring their value
and corresponding cost;
Goodwill: yearly assumptions within the context of impairment tests with particular respect to
determining cash-generating units (CGU), future cash flows and discount rates;
Deferred taxes, in particular deferred tax assets relating to losses that may be carried forward;
Assessment of provisions.
2.3 Scope and consolidation methods
Subsidiaries
The companies controlled by the Group are consolidated. Control is defined as the direct or indirect
power to determine the financial and operating policy of a company in order to benefit from its
activities. In order to assess control, potential voting rights that can currently be exercised are taken
into consideration. The individual financial statements of subsidiaries are included in the consolidated
financial statements starting from the date on which control is obtained and ending on the date when
control ceases.
Investments in associates and jointly controlled entities
An associate is an entity over which the Group exercises significant influence. Significant influence is
defined as the power to participate in the financial and operational policy-making of another entity
without however having control or joint control over policy.
A jointly controlled entity is a joint venture in which the parties exercising joint control over the entity
have rights over its net assets. Joint control is resulting from the agreed contractual sharing of control
over an entity that only exists when decisions concerning relevant activities require the unanimous
consent of the parties sharing control.
The profit and loss and the assets and liabilities of jointly controlled entities are recognised in the
present consolidated financial statements using the proportional consolidation method. Items
composing the assets and the profit and loss of joint ventures were recognised in proportion to the
representative fraction of the holding of the company owning the securities without establishing the
existence of any direct minority interests.
199
Transactions eliminated from the consolidated financial statements
Balance sheet balances, and income and expenses resulting from intra-group transactions are
eliminated in the preparation of the consolidated financial statements.
Inter-company loans and debts and income and expenses for proportionally consolidated joint ventures
are eliminated according to the joint venture's percentage of consolidation.
2.4 Business combinations
Business combinations are recognised using the acquisition method. According to this method, in the
first-time consolidation of an entity over which the Group acquires control:
 the identifiable assets acquired and liabilities assumed are measured at fair value when the
control is transferred to the group;
 non-controlling interests are measured either at fair value, or at their proportionate share of the
acquiree’s identifiable net assets.
This option is considered on a case-by-case basis for each acquisition.
Goodwill is measured as the positive difference between the sum of (i) the value of the consideration
transferred plus (ii) the value of any non-controlling interest in the acquiree plus (iii) the fair value of
the acquirer's previously held interest in the acquiree (if applicable) over the net balance of the
identifiable assets acquired and the liabilities assumed on the acquisition date.
If, after remeasurement, the acquisition-date net balance of the identifiable assets acquired and
liabilities assumed is greater than the sum of (i) the value of the consideration transferred plus (ii) the
value of any non-controlling interest in the acquiree plus (iii) the fair value of the acquirer's previously
held interest in the acquiree (if applicable), the difference is immediately recognised as a profit on an
acquisition under favourable conditions.
Other types of non-controlling interest must be measured at fair value or, if applicable, according to
another provision of IFRS.
In a business combination achieved in stages, the Group policy is to remeasure its previous interest in
the acquiree at its acquisition date fair value and recognise the resulting gain or loss, if any, in profit or
loss.
The allocation of the consideration transferred must be finalised within a twelve-month period from
the acquisition date.
Goodwill is then measured at its initial value less the accumulated impairment losses where
applicable.
2.5 Functional and presentation currency
The Group consolidated financial statements are prepared in euros, which is the functional and
presentation currency of the Company.
2.6 Foreign currency
Foreign currency transactions are translated into the respective functional currencies of the Company's
entities by applying the current exchange rate on the transaction dates. Monetary assets and liabilities
denominated in foreign currency at year-end are translated into the functional currency using the
exchange rate on that date.
200
Foreign exchange gains and losses resulting from the conversion of monetary balances correspond to
the difference between (i) the amortised cost denominated in the functional currency at the opening of
the period, adjusted for the effective interest and payments over the period, and (ii) the amortised cost
denominated in the foreign currency converted at the exchange rate at year-end.
Non-monetary assets and liabilities that are measured at fair value in foreign currency are translated
into the functional currency using the current exchange rate on the fair value measurement date.
Foreign currency differences arising on these translations are recognised in profit or loss, except for
differences resulting from the conversion of available-for-sale equity instruments, a financial liability
designated as a hedging instrument of a net investment in a foreign operation, or a cash flow hedging
instrument recognised directly as equity.
2.7 Distinction between current and non-current
In its balance sheet, the Group splits current and non-current assets and liabilities.
The distinction between current and non-current items is made according to the following:
 assets and liabilities composing the working capital requirements within the current business
cycle are classified as “current”;
 assets and liabilities outside the current business cycle are presented as either “current” or
“non-current” depending on whether their maturity is more or less than one year, or in
accordance with the provisions of IAS 1
2.8 Intangible assets
Goodwill
Goodwill acquired from a business combination is recognised at cost on the acquisition date (see note
2.4 above) less accumulated impairment losses, if any.
For the purpose of impairment testing, goodwill is allocated to each of the Group cash generating units
(or to each group of cash generating units) which are expected to benefit from the synergies of the
business combination.
Cash generating units to which goodwill is allocated are subject to an annual impairment test, or more
frequently if there is any triggering event or indication that any unit may have lost any value. If the
recoverable value of any cash generating unit is lower than its carrying amount, the impairment loss is
first recognised as a deduction of the carrying amount of any goodwill allocated to such unit, and is
then allocated to such unit other assets in proportion to the carrying amount of each of such unit asset.
Any impairment loss involving goodwill is recognised directly in profit or loss. Any impairment loss
recognized for goodwill will not be reversed in any subsequent periods.
When the company disposes any cash-generating unit, the related goodwill is considered when
determining the net result arising from such a disposal.
Separately acquired intangible assets
Intangible assets that have finite useful lives are measured at cost less accumulated amortisation and
any accumulated impairment losses. Amortisation is determined using the straight-line method over
the estimated useful life of the asset. Estimated useful lives and amortisation methods are revised at
each reporting date and the financial incidence of any change in assumptions is accounted for
prospectively. Separately acquired intangible assets that have indefinite useful lives are measured at
cost less accumulated impairment losses.
201
Self developed intangible assets – research and development costs
Research costs are expensed in the period where such costs are incurred.
A self developed intangible asset for a development (or for a development phase) of an internal project
is recognised only if all of the following criteria are met:
 technical feasibility for completing the intangible asset so that it can be used or sold;
 the intention to complete the intangible asset for the purpose of internal use or sale;
 the ability to use or sell the intangible asset;
 how the intangible asset will generate probable future economic benefits;
 the availability of adequate technical, financial and other resources to complete the
development and to use or sell the intangible asset;
 the ability to measure reliably the expenses attributable to the intangible asset during its
development.
The initial cost of a self developed intangible asset is capitalised as the sum of cost incurred from the
date when the intangible asset first met the recognition criteria listed above. When no internally
generated intangible asset can be capitalised, development costs are expensed in the net profit or loss
of the period these costs are incurred.
After initial recognition, self developed intangible assets are measured at cost less accumulated
amortisation and impairment losses, using the same method as for separately acquired intangible
assets.
These costs mainly include internal development costs of professional networking platforms
(websites) and software.
Viadeo Group has two main professional networking platforms:
 “Tianji” platform, exclusively accessible in China;
 “Viadeo” platform accessible everywhere except in China. This platform is especially utilised
in Europe (including Russia) and in Africa.
These two platforms are distinct both technically (different location of technical and human resources)
and economically with different levels of market maturity; this is especially the case in China (Tianji
platform), where the Group considers that the criteria for capitalising the development costs associated
with the website were not verified before 31 December 2012. During 2013 fiscal year, the criteria for
capitalising development costs associated with the Tianji platform were verified, in particular those
related to future economic benefits. Accordingly, the Group capitalised 1,314 K€ over the fiscal year.
Amortisation period and method
Amortisation is determined using the following method:
Method
Period
Self developed platforms
Straight-line
Three years
Software acquired
Straight-line
One to five
years
202
2.9 Tangible assets
Tangible assets are measured at acquisition cost, including, if any, expenditure that is directly
attributable to the acquisition of the asset. They are subsequently measured at cost less accumulated
amortisation and
any accumulated impairment losses.
Depreciation is calculated using the straight-line method according to estimated useful lives, taking
into account residual values where applicable:
Method
Period
General facilities and fixtures
Straight-line Five years
Transport equipment
Office and computer equipment
Straight-line Three years
Furnishings
Residual values, useful lives and asset depreciation methods are reviewed and revised when
appropriate at each reporting date. Such changes if any are accounted for as changes in estimates in
accordance with IAS 8.
A tangible asset item is derecognised on disposal if no future economic advantage is expected from its
ongoing use. Any profit or loss resulting from the disposal or discontinued use of a tangible asset item,
corresponding to the difference between the income from its disposal and its carrying amount, is
recognised in profit or loss.
Assets held under finance leases
Assets held under finance leases are initially recognised as Group assets measured at fair value at the
starting date of the lease or, if the fair value is lower, at the present value of minimum payments due
under the lease. The corresponding liability due to the lessor is recognised in the consolidated
statement of financial position as a liability resulting from a finance lease.
Rental payments are split between financing costs and debt redemption resulting from the finance
lease, so as to obtain a stable interest rate on the outstanding payable.
Financing costs are accounted for in profit and loss.
The assets rented under finance lease arrangements are depreciated over their estimated useful life
using the same method as for any assets held. However, when there is no reasonable certainty that
ownership will be acquired at the end of the lease, the assets are depreciated over the shorter period of
between the lease duration and the useful life.
2.10 Financial assets
The Group’s financial assets are classified by type and availability for sale:
 financial assets measured at fair value in profit or loss;
 investments available for sale measured at fair value;
 investments held to maturity;
 loans and receivables.
Except for assets measured at fair value through profit or loss, all financial assets are initially
recognised at cost, i.e. the fair value of the price paid plus acquisition costs.
203
Standardised purchases and sales of financial assets are recognised at their payment date.
Financial assets at fair value through profit or loss
These assets are held for trading purposes, i.e. assets acquired by the Company with the purpose of
disposing of them in the short term. They are measured at fair value; changes in fair value are
recognised in profit or loss. Certain assets may also be voluntarily classified under this category.
Directly related transaction costs are recognised in profit or loss when incurred.
Available for sale financial assets recognised at fair value
Available-for-sale financial assets are non-derivative financial assets that are designated as available
for sale or that are not classified in any of a) loans and receivables, b) investments held to maturity, or
c) financial assets measured at fair value through profit or loss.
Available for sale financial assets are measured at fair value; any change in their fair value is
recognised in other comprehensive income, except for impairment losses and foreign currency
differences on available-for-sale debt.
Available-for-sale equity instruments that are not quoted in an active market and which fair value
cannot be measured reliably are measured at cost less impairment losses identified at each reporting
date.
Loans and receivables
This category includes other loans and receivables and trade receivables.
Non-current financial assets include advances and deposits granted to third parties. Advances and
deposits are non-derivative financial assets with fixed or determinable payments that are not quoted in
an active market.
Such assets are recognised at amortised cost using the effective interest rate method. Gains/losses are
recognised in profit or loss when loans and receivables are derecognised or impaired.
Depreciation of financial assets
Financial assets other than those measured at fair value through profit or loss are subject to an
impairment test at each reporting date. Financial assets are depreciated if there is an objective
indication that one or more events occurring after their initial measurement will affect future estimated
cash flows of such financial assets.
Derecognition of financial assets
The Group derecognises a financial asset when the contractual rights over the cash flows related to this
asset expire, or when the ownership and the associated risks and rewards of the financial asset are
transferred to a third party. If the Group neither transfers nor keeps almost all of the risks and rewards
associated with the ownership of the asset and continues to control the disposed asset, it recognises its
share in the asset and any related liability for the amounts it must pay. If the Group keeps almost all of
the risks and rewards associated with the ownership of a disposed financial asset, the financial asset
continues to be accounted for, in addition to the consideration received against the secured debt
accounted for.
204
2.11 Recoverable amount of non-current assets
Assets with an indefinite useful life are not amortised; they are subject to an annual impairment test or
more frequently if there is any indication of an impairment loss.
Amortised assets are subject to an impairment test whenever there is an internal or external indication
that an asset may have lost value.
The impairment test consists of comparing the carrying amount of a given asset with its recoverable
value. This test is performed at the level of a cash-generating unit (CGU), which is the smallest group
of assets including the given asset whose continued use generates cash inflows, largely independent of
those generated by other assets or groups of assets.
An impairment loss is recognised to the extent that the carrying amount of a given asset is higher than
its recoverable amount. The recoverable amount of an asset is the greater of its fair value less costs to
sell and its value in use.
Fair value is the amount that can be obtained from the sale of an asset in an ordinary transaction
between market participants at the measurement date.
Value in use is the present value of estimated future cash flows expected from the continued use of an
asset and from its disposal at the end of its useful life. Value in use is determined on the basis of
estimated cash flows based on a five-year forecast period; cash flows are further projected by applying
a constant or declining growth rate and then discounted using long-term market rates after tax
reflecting market estimates of the time value of money and the specific risks attached to the given
asset(s). Terminal value is determined by discounting in perpetuity the last annual cash flow estimated
in the impairment test.
At 31 December 2012 and 31 December 2013, there were no indications that any non-current assets
may have lost value.
2.12 Cash, Cash equivalents and Financial instruments
Cash and short-term deposits recorded in the balance sheet include cash in bank, petty cash and shortterm deposits with an initial maturity date of less than three months.
Cash equivalents consist of short-treme investments (OPCVM). Cash equivalents are held for
transaction purposes, since they are readily convertible into cash and carry a negligible risk of
changing in value. They are measured at fair value; changes in value are recorded in financial profit or
loss.
Short-term deposits are investments made for a period of less than three months at a fixed interest rate.
The Company's funds are secured and it can withdraw them before the maturity date, albeit at a lower
interest rate than that agreed initially. No penalty is due for early withdrawal.
For the purposes of presenting the consolidated cash flow statement, net cash includes cash and cash
equivalents as defined above.
2.13 Fair value of financial instruments
Current investments defined as cash equivalents at year-end are recognised at fair value through profit
or loss, fair value being based on a market value.
Loans and other financial liabilities are recognised at amortised cost, calculated using the effective
interest rate.
205
The fair value of trade receivables and trade payables is considered the same as their carrying amount
given the short payment terms of these receivables and payables. The same applies to other current
receivables and payables.
The Group has distinguished three categories of financial instruments according to how their
characteristics affect their measurement; it uses this classification to disclose some of the information
required by IFRS 7:



Category 1: financial instruments quoted on an active market;
Category 2: financial instruments measured on the basis of observable parameters;
Category 3: financial instruments partly or wholly measured on the basis of unobservable
parameters; an unobservable parameter is defined as a parameter whose value is based on
assumptions or correlations not supported by either observable market trades in the instrument
on the measurement date, or on observable market data available on the same date.
The only instruments recognised at fair value through profit or loss that are held by the Group are cash
equivalents in Category 1.
2.14 Government grants
Grants and conditional advances
The Group receives various government grants in the form of grants or conditional advances.
They are accounted for in accordance with IAS 20: financial advances granted at an interest rate below
the market rate are measured in accordance with IAS 39 at amortised cost, if such adjustment is
material. The amount resulting from the favourable rate obtained on a refundable not interest-bearing
advance is considered to be a grant. This grant is determined by applying a discount rate
corresponding to the market rate at grant date.
Grants are recorded under other operating income in the consolidated income statement .Advances are
accounted for under “Non-current interest-bearing loans” or “Current interest-bearing loans”
depending on their maturity date.
Research tax credit
The French government grants Research Tax Credits to companies as incentives to carry out technical
and scientific research. Companies with demonstrable expenditure meeting the relevant
criteria(research expenditure undertaken in France or, from 1 January 2005, within the European
Community or in another State that is party to the European Free Trade Area Agreement and that has
entered with France into a tax agreement containing an administrative assistance clause) benefit from a
tax credit against income tax for the fiscal year in which expenditure are incurred and in the following
three fiscal years; amounts exceeding taxes otherwise due may be refunded where applicable.
The Research Tax Credit is presented in the consolidated income statement as a grant under the
caption “Other current operating income and expenses”.
2.15 Receivables
Receivables are measured at their nominal value. Where applicable, they are reserved for on a case-bycase basis through allowances for doubtful accounts.
Income tax receivables amount to the nominal value of the Research Tax Credit recorded as an asset
for the fiscal year of acquisition corresponding to the fiscal year during which the eligible expenditure
giving rise to the tax credit was incurred.
206
2.16 Equity
The classification of an item under equity depends on the characteristics of each instrument issued.
Thus, ordinary shares and preferred shares are classified as equity instruments.
Ancillary costs directly attributable to issuing shares or share options are accounted for as a deduction
from equity, net of tax.
2.17 Share based payments
Since its creation, the Group has implemented several equity settled share based payments in the form
of warrants (BSA) and founder's warrants (BSPCE) attributed to employees, executives and members
of the board of directors.
Pursuant to IFRS 2, the cost of equity settled transactions is recognised as an expense with a
corresponding increase in equity, over the period that the beneficiary becomes unconditionally entitled
to the awards.
The fair value of the warrants granted to employees is determined using Black-Scholes option pricing
model.
The fair value of the options is determined in line with the conditions governing rights acquisitions as
described in Note 11.2. Note 11.2 also presents the other factors taken into consideration.
The benefit measured in accordance with IFRS 2 is considered as a beneficiaries' compensation; it is
recognised as "Share-based payments to employees" within the recurring operating income on a
straight-line basis over the rights-acquisition period with a corresponding increase in shareholders’
equity.
2.18 Provision
A provision is recognised if (i) the Group has a present obligation (legal or constructive) resulting
from a past event, (ii) it is probable that a Group outflow of economic benefits will be required to
settle the obligation and (iii) the amount of the obligation can be reliably estimated.
The amount accounted for under provision is the best estimate of the consideration needed to settle the
present obligation at each reporting date , taking the risks and uncertainties related to the obligation
into account. If a provision is measured on the basis of the estimated cash flows required to settle the
present obligation, its carrying amount will correspond to the discounted value of these cash flows
(due to the large impact of the time value of money).
If arrangements have been made for part or all of the economic benefits required to settle a provision
to be recovered from a third party, the amount to be received will be recognised as an asset if it can be
measured reliably and if the repayment is substantially guaranteed.
Restructuring
A provision for restructuring is recognised once the Group has finalised a formal and detailed
restructuring plan and has created well-founded expectations in the persons concerned which will
trigger the restructuring, either by starting to put the plan into action or by informing them of its main
characteristics. The measurement of a provision for restructuring only takes expenditure directly
linked to the restructuring into account, including unavoidable restructuring expenses and expenses
not linked to the entity's business.
207
2.19 Employee benefits
The Group’s French employees receive the following retirement benefits under French law:
 a lump sum payment by the Company when an employee retires (defined benefit plan);
 pension payments by State Welfare organisations financed by employer and employee
contributions (defined contribution plan).
Pension plans and other employee benefits defined as benefit plans (in which the Company undertakes
to guarantee defined payments or benefits) are recognised in the balance sheet on the basis of an
actuarial measurement of the benefits at year-end minus the fair value of the assets pledged to the
relative plan.
The actuarial measurement is based on the projected unit credit method taking staff turnover and
probability of death into account. Changes in net liabilities resulting from actuarial gains and losses
incurred as a result of defined benefits are recognised in “other comprehensive income”.
Payments by the Group into defined contribution plans are expensed in the income statement for the
related period.
Defined benefit plans in relation to employees of foreign subsidiaries are immaterial in view of local
legal and regulatory provisions.
2.20 Financial liabilities
Financial liabilities are recognised initially at fair value through profit or loss or under “other financial
liabilities”.
Financial liabilities measured at fair value through profit or loss
Financial liabilities are recognised at fair value through profit or loss when they are held for trading or
when they are measured at fair value in profit or loss.
Other financial liabilities
Other financial liabilities (including loans and trade and other payables) are subsequently measured at
amortised cost using the effective interest method.
The effective interest method is used to calculate the amortised cost of a financial liability and allocate
the interest expenses over the relevant period. The effective interest rate is the rate that exactly
discounts estimated future cash payments (including all fees and points paid or received that are an
integral part of the effective interest rate, transaction costs and other premiums or discounts) over the
expected life of the financial liability, or a shorter period when appropriate, to the net carrying amount
of the financial liability at the time of initial recognition.
Derecognition of financial liabilities
The Group derecognises financial liabilities if, and only if, the Group’s contractual obligations are
discharged, cancelled or expired. The difference between the carrying amount of a derecognised
financial liability and the duly paid consideration is recognised in profit or loss.
208
2.21 Recognition of revenue
The Group has three sources of revenue: premium subscriptions sold to professionals (Online
Subscriptions/OS), recruitment tools and services sold to corporate clients (Hiring Solutions), and
advertising space and marketing services sold to corporate clients (Marketing Solutions).
Revenue is measured at the fair value of the consideration received or receivable.
Revenue from premium subscriptions constitutes a service provided on an on-going basis. Revenue is
recognised pro rata temporis on a daily basis. At year-end, the share of subscriptions giving access to
the websites over the following period is recognised as deferred revenue.
Revenue from advertising campaigns consisting of banners posted on the Group's Marketing Solutions
website is recognised as the campaigns progress.
Job advertisements generate revenue when they are posted, whereas recruitment and training solutions
are recognised pro rata temporis based on the period of services.
The application of these principles gives rise to the recognition of billable services and deferred
revenue when invoices are not issued in the same period as the services are rendered.
As part of its activities, the Viadeo Group barters services (ad swaps) with its partners. In accordance
with SIC 31, the revenue from a barter transaction involving advertising is recognised by the Group at
the fair value of the advertising services it provides in a barter transaction by reference to non-barter
transactions that:





involve advertising similar to the advertising in the barter transaction;
occur frequently;
represent a predominant number and amount of transactions when compared to all transactions
to provide advertising that is similar to the advertising in the barter transaction;
involve cash and/or another form of consideration whose fair value can be reliably measured;
do not involve the same party as the barter operation.
Other revenue is recognised when future economic benefits are likely to flow to the Group and this
revenue can be reliably measured.
2.22 Corporation tax
Income tax expense represents the sum of current and deferred tax.
Current tax
Tax payable is based on taxable profit for the fiscal year. Taxable profit differs from “income before
tax” recognised in the consolidated income statement because of income and expense line items that
are taxable or deductible during other fiscal years, as well as items that are never taxable or deductible.
The Group's current tax is calculated using the adopted or nearly-adopted tax rates in each country at
each reporting date.
In France, the 2010 Finance Act, passed on 30 December 2009, abolished the requirement for French
tax units to pay business tax beginning in 2010 and replaced it with the Regional Economic
Contribution (Contribution Economique Territoriale, or CET) made up of two separate contributions:

the Cotisation Foncière des Entreprises (CFE) based on the property rental values of the
business tax;
209

the Cotisation sur la Valeur Ajoutée (CVAE) based on the value added resulting from the
individual accounts.
The Group considered that the CVAE fits the definition of income tax as stated in IAS 12 Income
taxes. Thus, since 1 January 2012 (the transition date), the expense relating to the CVAE has been
presented in the income statement under “Income taxes”. The CFE has been recognised under
recurring operating expense .
The third amendment to the 2012 Finance Act introduced the Tax Credit for Competitiveness and
Employment (Credit d’impôt pour la compétitivité et l’emploi, or CICE) effective for periods
beginning 1 January 2013. This tax credit is calculated on the basis of wages and salaries. In the Group
consolidated accounts, the CICE is presented in accordance with IAS 19 as a reduction in salaries and
fringe benefits.
Deferred tax
Deferred tax is determined according to the temporary differences between the carrying amounts of
the assets and liabilities in the consolidated financial statements and their corresponding tax bases
when calculating taxable profit.
In general, deferred tax liabilities are recognised for all taxable temporary differences. Deferred tax
assets are generally recognised for all deductible temporary differences to the extent that it is probable
that a taxable profit, to which these temporary differences can be allocated, will be available. Such
deferred tax assets and liabilities are not recognised if the temporary difference results from the initial
recognition of assets and liabilities related to a transaction (other than a business combination) that has
no effect on taxable profit or on accounting profit. Furthermore, deferred tax liabilities are not
recognised if the temporary difference results from the initial recognition of goodwill.
Deferred tax liabilities are recognised for all taxable temporary differences related to investments in
subsidiaries, associates and jointly controlled entities unless the Group is capable of controlling the
date on which the temporary difference is reversed and if the temporary difference is unlikely to be
reversed in the foreseeable future. Deferred tax assets resulting from deductible temporary differences
generated by such investments are recognised only if it is probable that the taxable profit will be
sufficient to enable use of the temporary difference benefits and if the temporary difference will be
absorbed within a period of three years.
The carrying amount of deferred tax assets is reviewed at the end of each financial information
presentation period and is reduced if it is no longer probable that sufficient taxable profit will be
available to enable recovery of all or part of the asset.
Deferred tax liabilities and assets are measured on a per-country basis at the tax rates that are expected
to apply to the period when the asset is realised or the liability is settled according to the tax rates (and
tax laws) adopted or nearly-adopted at the each reporting date.
The measurement of deferred tax liabilities and assets reflects the tax consequences that would result
from how the Group expects to recover or settle the carrying amount of its assets and liabilities at each
reporting date.
Current tax and deferred tax for the fiscal year are recognised in profit or loss unless they involve
items recognised under other comprehensive income or directly under equity, in which case current
and deferred taxes are also recognised under other comprehensive income or directly under equity,
respectively.
210
2.23 Segment information
the chief operating decision-makers.
An operating segment is a component of the Group that engages in business activities from which it
may earn revenues and incur expenses, including revenues and expenses related to transactions with
other components of the Group. The gross margin per segment is regularly reviewed by General
Management to make decisions regarding the resources to be allocated to the segment and to assess its
performance. Separate financial information is available for this component.
For Viadeo and Tianji, information is then analysed on the basis of the various service categories
(Online subscriptions, Recruitment and training services, and Marketing and advertising services).
In accordance with IFRS 8, the Group segments are as follows:
- The Viadeo platform: this segment consists of the Viadeo subscribers’ database, the Viadeo
technical platform and dedicated employees. It comprises the Group's activities in Europe, the
United States, Africa and Russia;
- The Tianji platform: this segment consists of the Tianji subscribers’ database, the Tianji
technical platform and dedicated employees. It comprises the Group’s activities in China.
During the 2013 fiscal year, the company carried out a strategic reassessment of its subsidiaries
leading to the dissolution of six entities. Four entities were dissolved in 2013 (Senegal, Italy, Spain
and Mexico), while ApnaCircle, the Indian subsidiary, is currently being dissolved and Soocial, the
Dutch subsidiary, has ceased its business activities. Although these six entities have ceased their
business activities, the remaining expenses were recorded in the 2013 financial statements. The
recurring expenses of these subsidiaries (liquidated or in the process of liquidation) are accordingly
still recorded under recurring income, just like the expenses of active subsidiaries. The impact of
subsidiaries that have been liquidated or ceased their business activities on Operating Margin and
recurring operating income amounts to a loss of €1,442K (recurring and non-recurring expenses).
Furthermore, provisions for the costs of closing these subsidiaries affected non-recurring operating
income in the amount of €92K in 2013 and €257K in 2012.
Lastly, the Group's central costs due to its group structure are supported in full by the Viadeo
segment without a proportional share-out with the Tianji segment.
2.23 Segment information
the chief operating decision-makers.
An operating segment is a component of the Group that engages in business activities from which it
may earn revenues and incur expenses, including revenues and expenses related to transactions with
other components of the Group. The gross margin per segment is regularly reviewed by General
Management to make decisions regarding the resources to be allocated to the segment and to assess its
performance. Separate financial information is available for this component.
For Viadeo and Tianji, information is then analysed on the basis of the various service categories
(Online subscriptions, Recruitment and training services, and Marketing and advertising services).
In accordance with IFRS 8, the Group segments are as follows:
- The Viadeo platform: this segment consists of the Viadeo subscribers’ database, the Viadeo
technical platform and dedicated employees. It comprises the Group's activities in Europe, the
United States, Africa and Russia;
211
-
The Tianji platform: this segment consists of the Tianji subscribers’ database, the Tianji
technical platform and dedicated employees. It comprises the Group’s activities in China.
During the 2013 fiscal year, the company carried out a strategic reassessment of its subsidiaries
leading to the dissolution of six entities. Four entities were dissolved in 2013 (Senegal, Italy, Spain
and Mexico), while ApnaCircle, the Indian subsidiary, is currently being dissolved and Soocial, the
Dutch subsidiary, has ceased its business activities. Although these six entities have ceased their
business activities, the remaining expenses were recorded in the 2013 financial statements. The
recurring expenses of these subsidiaries (liquidated or in the process of liquidation) are accordingly
still recorded under recurring income, just like the expenses of active subsidiaries. The impact of
subsidiaries that have been liquidated or ceased their business activities on Operating Margin and
recurring operating income amounts to a loss of €1,442K (recurring and non-recurring expenses).
Furthermore, provisions for the costs of closing these subsidiaries affected non-recurring operating
income in the amount of €92K in 2013 and €257K in 2012.
Lastly, the Group's base costs are supported in full by the Viadeo segment without a
proportional share-out with the Tianji segment.
212
Fiscal year ended 31 December 2013
Segment income statement - euros 000
VIADEO
2013
TIANJI
2013
Inter-segment
transactions
Consolidated
income statement
15 793
-
8 444
368
4 485
473
(0)
4 958
Other income
1 355
361
(361)
1 355
30 076
1 202
(361)
30 917
Staff expenses
-
15 793
8 812
(19 729)
(3 444)
(3 649)
(1 764)
-
(5 413)
(9 571)
(1 860)
422
(11 009)
479
-
(61)
418
(2 395)
(5 866)
0
(8 261)
Operating margin
(23 174)
(972)
93
Amortization and provision expenses
(5 284)
(14 424)
(92)
-
(92)
(14 516)
Financial income
210
Financial expenses
(439)
(229)
-
-
(14 745)
1 624
(13 121)
(13 121)
213
Segment income statement - euros 000
VIADEO
2012
TIANJI
2012
Inter-segment
transactions
Consolidated
income statement
15 937
1
15 938
7 350
187
7 537
3 796
120
348
646
(652)
342
27 430
954
(652)
27 733
(16 821)
(2 578)
(1 992)
(1 097)
(8 870)
(1 319)
645
(8)
Operating margin
393
(4 048)
Other income
Staff expenses
3 916
(19 399)
(3 089)
652
637
(0)
(798)
(102)
Amortization and provision expenses
(3 756)
(8 310)
(9 537)
(3 655)
(257)
-
(257)
(8 567)
Financial income
269
Financial expenses
(484)
(216)
-
-
(8 783)
3 974
(4 809)
(4 809)
The Group has no operational sub-segments apart from the operational segments presented above.
214
Segment assets - euros 000
Non-current assets
31/12/2013
Inter-segment Consolidated
TIANJI
assets
assets
VIADEO
19 119
4 091
Goodwill
2 932
2 287
5 219
Intangible assets
6 633
1 194
7 827
960
327
1 287
Equity-accounted investments
-
-
-
1 503
283
1 786
1 631
-
1 631
Deferred tax assets
5 460
-
5 460
10 428
1 058
(51)
11 435
6 045
230
(51)
6 223
614
0
Current assets
Tax asset - current
TOTAL ASSETS
Segment liabilities - euros 000
-
23 210
614
0
-
0
3 769
828
4 597
29 547
5 149
VIADEO
(51)
34 645
31/12/2013
Inter-segment Consolidated
TIANJI
liabilities
liabilities
2 506
-
1 072
-
1 072
Other provisions
330
-
330
312
-
312
792
-
792
20 812
868
(51)
21 628
9 504
830
(51)
10 282
2 473
-
2 473
675
-
675
Current liabilities
Other current provisions
Tax liability
-
2 506
69
-
69
8 091
38
8 129
23 317
868
215
(51)
24 134
Segment assets - euros 000
Non-current assets
31/12/2012
Inter-segment Consolidate
TIANJI
assets
d assets
VIADEO
VIADEO
TIANJI
17 303
2 711
20 014
13 789
2 590
Goodwill
3 037
2 323
5 360
3 083
2 340
Intangible assets
7 130
11
7 141
7 756
3
1 092
235
1 328
1 009
123
Equity-accounted investments
-
01/01/2012
-
-
-
-
-
1 363
141
1 505
1 278
124
739
-
739
663
-
3 941
-
3 941
0
-
24 079
1 401
(46)
25 434
8 338
1 195
5 510
392
(46)
5 857
4 955
568
637
-
637
440
-
Tax asset - current
671
-
671
-
-
17 260
1 009
18 269
2 943
627
41 382
4 111
45 448
22 128
3 784
Deferred tax assets
Current assets
TOTAL ASSETS
(46)
31/12/2012
Segment liabilities - euros 000
VIADEO
01/01/2012
Inter-segment Consolidate
liabilities
d liabilities
TIANJI
TIANJI
2 906
-
2 906
3 873
-
1 421
-
1 421
2 574
-
Other provisions
120
-
120
71
-
449
-
449
632
-
916
-
916
597
-
19 062
418
(46)
19 434
16 692
315
8 986
418
(46)
9 358
7 525
315
560
-
560
2 215
-
290
-
290
13
-
50
-
50
25
-
9 176
-
9 176
6 914
-
21 968
418
22 340
20 565
315
Current liabilities
Tax liability
-
VIADEO
(46)
All assets have been allocated to the segments presented except for other non-current financial assets
(investments).
All liabilities have been allocated to the segments to be presented.
216
2.24 Geographical information
The Group has business activities primarily in the following regions: France (where it has its
headquarters), China, Russia and Africa.
The following table presents revenue generated from external customers of the Group based on their
geographical location, and information on its non-current assets per region for the last two fiscal years
ended 31 December 2013 and 31 December 2012.
(euros 000)
France
China
Russia
Africa
Other
Total
31/12/2013
29 374
841
268
45
390
30 917
31/12/2012
26 692
302
314
37
387
27 733
No single customer accounts for more than 10% of the Group's total revenue.
Breakdown of non-current assets by region:
Country
France
United States
Africa
China
Russia
Other
Total
Non current assets – euros 000
31/12/2013
31/12/2012
01/01/2012
4 606
3 283
2 835
12 611
10 942
6 727
14
4
1
4 091
2 711
2 590
123
49
1 765
23 210
3 026
20 014
4 241
16 392
The “Other” region mainly consists of European countries.
2.25
Presentation of the consolidated income statement
The consolidated income statement is presented according to the type of expense and income.
The presentation of the consolidated income statement comprises the following sub-totals:
- Operating margin, which is the surplus from the company's current production/trading activities. It is
equal to recurring operating income (defined below) before amortisation and provision for the
depreciation of fixed assets, depreciation of current assets, provision for operating liabilities, and nonmonetary items, especially share-based payments;
- “Recurring operating income (loss)”, which is the balance between income and expenses before tax,
except for expenses and income resulting from financial activities, associates and discontinued
operations. This fundamental indicator to the Group enables measurement of its performance before
the effect of “Non-recurring operating income";
- "Non-recurring operating income (loss)" comprises income and expenses from a major event which
occurred during the accounting period and which may distort the proper interpretation of the
company's performance. Accordingly, it refers to very limited, unusual or infrequent income and
expenses.
217
2.26
Earnings per share
Basic earnings per share is calculated by dividing the net profit attributable to Company shareholders
by the weighted average number of ordinary shares in circulation during the period.
Diluted earnings per share is determined by adjusting the net profit attributable to holders of ordinary
shares and the weighted average number of ordinary shares in circulation for the effect of all potential
dilutive ordinary shares.
If the inclusion of instruments giving access to equity (warrants, share options) in the calculation of
diluted earnings per share has an anti-dilutive effect, these instruments are not taken into account.
218
Note 3: Goodwill
(euros 000)
1 January
2012
Increase
Decrease
Reclassification
Currency
translation
differences
31 December
2012
Cost
VIADEO
TIANJI
Cumulative total impairment
Total
(euros 000)
3 083
2 340
0
0
0
0
0
0
(46)
(18)
3 037
2 323
0
0
0
0
0
0
5 423
0
0
0
(64)
5 360
31 December
2012
Increase
Decrease
Reclassification
Currency
translation
differences
31 December
2013
Cost
VIADEO
TIANJI
Cumulative total impairment
Total
3 037
2 323
0
0
0
0
0
0
(105)
(36)
2 932
2 287
0
0
0
0
0
0
5 360
0
0
0
(141)
5 219
Impairment test for intangible assets with an indefinite life
Goodwill (carrying value of €5,219K at 31 December 2013) was subject to an annual impairment test.
Five years of estimated future cash flows were included in the discounted cash flow model before
taking a terminal value into account.
The principles applied by the Company are described in Note 2.2.
In view of the nature of the Group’s business, the definition of a CGU assumes a combination of the
following three factors: a technical platform, a subscriber database and dedicated employees.
Thus, for the purposes of the impairment tests, goodwill was allocated to the following cash-flowgenerating units:
 VIADEO;
 TIANJI.
The Company applied the following discounting rates:
Discount rate
VIADEO
TIANJI
01/01/2012
13,66%
19,80%
31/12/2012 31/12/2013
12,51%
12,83%
18,00%
17,60%
VIADEO CGU parameters
Risk-free interest rate
Risk premium
Beta
01/01/2012
3,16%
7,00%
1,5
31/12/2012 31/12/2013
2,01%
2,33%
7,00%
7,00%
1,5
1,5
TIANJI CGU parameters
Risk premium
Beta
01/01/2012
3,60%
11,00%
1,2
31/12/2012 31/12/2013
3,60%
3,60%
11,10%
10,90%
1,0
1,0
219
The perpetuity growth rate applied was 1.5%.
A one-basis point increase in the discount rate would not lead to an impairment loss.
A one-basis point decrease in the perpetuity growth rate would not lead to an impairment loss.
Viadeo carried out sales and market penetration forecasts using available market data and with respect
to the growth achieved during the fiscal years presented.
The Group also took account of risk factors derived from the forecasts and retained assumptions on the
probability of success of its research and development projects currently underway.
These analyses enabled the Group to produce five-year cash flow projections correlated to the Group’s
stage of development, its business model and its financing structure.
The cash flow projections were produced on the basis of an assumption of average growth in turnover
for the period over five years of two figures per year for the Viadeo CGU, and of three figures per year
for the Tianji CGU in view of the growth potential in the Chinese market.
At 31 December 2013, analyses of the sensitivity of the business plans did not generate a risk of an
impairment loss. A 20% drop in the growth rate used would not lead to an impairment loss.
Note 4: Other intangible assets
(euros 000)
1 January
2012
Acquisitions
Change in
Currency
Disposals/
/ amort.
consolidation translation
scrapping
exp.
scope
differences
Reclassifications
31 December
2012
Gross
Software
Business network platforms
Other intangible assets
Intangible assets in progress
Total
413
7 977
6
1 319
30
256
0
2 596
(7)
(316)
0
0
0
0
0
0
(0)
(252)
0
(29)
0
2 368
0
(2 368)
436
10 033
6
1 518
9 714
2 882
(323)
0
(281)
0
11 992
(242)
(1 708)
(5)
0
(84)
(3 054)
(0)
0
0
178
0
0
0
0
0
0
0
63
0
0
0
0
0
0
(325)
(4 521)
(5)
0
(1 954)
(3 138)
178
0
63
0
(4 851)
172
6 269
1
1 319
(54)
(2 798)
(0)
2 596
(7)
(138)
0
0
0
0
0
0
(0)
(189)
0
(29)
0
2 368
0
(2 368)
110
5 513
1
1 518
7 761
(256)
(145)
0
(218)
0
7 141
Depreciation, amortisation and impairment
Software
Total
Net
Software
Total
220
(euros 000)
31 December
2012
Acquisitions
Change in
Currency
Disposals/
/ amort.
scrapping
exp.
scope
differences
Reclassifications
31 December
2013
Gross
Software
Total
436
10 033
6
1 518
21
1 973
0
3 132
(373)
(3 024)
(6)
0
0
0
0
0
(1)
(562)
0
(108)
0
1 899
1
(1 899)
82
10 320
0
2 643
11 992
5 126
(3 404)
0
(670)
1
13 045
(325)
(4 521)
(5)
0
(86)
(3 514)
0
0
373
2 759
5
0
0
0
0
0
0
96
0
0
0
0
0
0
(38)
(5 180)
0
0
(4 851)
(3 601)
3 137
0
97
0
(5 218)
110
5 513
1
1 518
(66)
(1 541)
0
3 132
(0)
(265)
(1)
0
0
0
0
0
(0)
(465)
0
(108)
0
1 899
1
(1 899)
44
5 140
0
2 643
7 141
1 525
(267)
0
(574)
1
7 827
Software
Total
Net
Software
Total
The professional networking platforms take into account the allocation of the acquisition price in the
amount of €3,365K recognised under the acquisition of Soocial in December 2011. This asset is
amortised over a three-year period.
Intangible assets in progress relate to expenses for the development of professional networking
platforms which were not used at year-end. The total development cost of the platforms capitalised
during the 2013 fiscal year amounts to €3,132K and the total cost of the platforms used amounts to
€1,899K.
During the 2013 fiscal year, the criteria for capitalising development costs associated with the Tianji
platform were met , in particular the criterion concerning future economic benefits. Accordingly, the
Group capitalised €1,314K.
In 2013, the Group scrapped the development costs for the platform corresponding to applications that
had become obsolete. Since these applications had been almost completely depreciated, the
corresponding net carrying amount was €265K.
There were no indications of impairment losses in accordance with IAS 36. Consequently, the
Company did not carry out the impairment test for intangible assets which are amortised. For the
professional networking platform, an indication of impairment loss can for example correspond to
changes in technology making it obsolete, or to a series of technical hitches materially affecting its
profitability.
221
Note 5: Tangible assets
1 January
2012
(euros 000)
Acquisitions
Change in
Currency
Disposals/
Assignment 31 December
/ amort.
scrapping
and transfer
2012
exp.
scope
differences
Gross
Computer hardware
Office equipment
Motor vehicles
Other Property, plant and equipment
Total
1 497
102
53
163
1 177
70
0
9
(472)
(41)
0
0
0
0
0
0
(33)
(1)
(1)
0
0
36
0
(36)
2 169
166
52
137
1 815
1 257
(513)
0
(36)
0
2 523
(576)
(46)
(30)
(30)
(523)
(27)
(9)
(27)
33
22
0
0
0
0
0
0
16
0
1
(0)
0
(11)
0
11
(1 049)
(61)
(38)
(46)
(682)
(586)
56
0
17
0
(1 195)
920
56
23
133
655
44
(9)
(18)
(438)
(18)
0
0
0
0
0
0
(17)
(1)
(1)
0
0
24
0
(24)
1 119
105
13
91
1 133
671
(457)
0
(19)
0
1 328
Computer hardware
Office equipment
Motor vehicles
Total
Net
Computer hardware
Office equipment
Motor vehicles
Total
(euros 000)
31 December
2012
Acquisitions
Change in
Currency
Disposals/
Assignment 31 December
/ amort.
scrapping
and transfer
2013
exp.
scope
differences
Gross
Computer hardware
Office equipment
Motor vehicles
Total
2 169
166
52
137
514
136
0
225
(199)
(24)
0
0
(6)
(1)
0
0
(83)
(6)
(4)
0
0
(0)
0
0
2 396
271
48
362
2 523
875
(223)
(7)
(93)
0
3 076
(1 049)
(61)
(38)
(46)
(674)
(67)
(4)
(94)
167
20
0
0
0
0
0
0
53
3
3
0
(0)
0
0
0
(1 504)
(105)
(40)
(140)
(1 195)
(839)
188
0
58
0
(1 789)
1 119
105
13
91
(160)
69
(4)
131
(32)
(3)
0
0
(6)
(1)
0
0
(30)
(4)
(1)
0
(0)
0
0
0
892
166
8
222
1 328
36
(35)
(7)
(35)
0
1 287
Computer hardware
Office equipment
Motor vehicles
Total
Net
Computer hardware
Office equipment
Motor vehicles
Total
There were no indications of an impairment loss in tangible assets at 31 December 2013; no
depreciation was accounted.
222
Note 6: Jointly controlled entities
The following table presents details on the Group’s joint ventures at each reporting date:
Name of the joint-venture
Main activity
Place of incorporation
and main business
establishment
Viadeo Independant Media BV
Holding company
Viadeo Independant Media LLC Professional social network
The Netherlands
Russia
Percentage of interest and voting rights held by
the Group
31/12/2013
31/12/2012
50%
50%
50%
50%
The abovementioned joint ventures were recognised according to the proportionate consolidation
method in these consolidated financial statements.
The following table summarises the financial information of the Group’s joint ventures. It summarises
the amounts relating to joint ventures as indicated in the financial statements prepared in accordance
with IFRS:
(euros 000)
31 December 31 December
2013
2012
Non-current assets
245
98
Current assets
257
326
2
30
167
175
Current liabilities
31 December
2013
31 December
2012
535
630
Operating profit (loss )
(893)
(515)
Profit (loss) before tax
(879)
(519)
Profit from activities continued during fiscal year
(708)
(424)
(708)
(424)
(euros 000)
Revenue
As of1 January 2014, in view of the rights and obligations involved in the partnerships, interests will
be recognised using the equity method in accordance with IFRS 11.
223
Note 7: Other financial assets and other non-current assets
7.1. Other financial assets
1 January
2012
Increase
Decrease
Change in
consolidation
scope
246
0
0
0
0
246
53
16
0
0
0
69
661
138
(58)
0
(2)
738
452
0
0
0
0
452
1 412
153
(58)
0
(3)
1 505
0
0
0
0
0
0
1 412
153
(58)
0
(3)
1 505
31 December
2012
Increase
Decrease
Change in
consolidation
scope
246
0
0
(0)
(5)
240
69
9
(1)
0
(21)
55
738
329
(19)
0
(9)
1 039
452
0
0
0
0
452
1 505
337
(21)
(0)
(35)
1 786
0
0
0
0
0
0
1 505
337
(21)
(0)
(35)
1 786
Other
changes
31 December
2012
Gross
Investments available for sale
(AFS – non-current)
Receivables related to equity
investments
Loans, guarantees and other
debts – non-current
Investments in fair value through
P&L
Total
Depreciation / impairment
Total
Other
changes
31 December
2013
Gross
Investments available for sale
(AFS – non-current)
Receivables related to equity
investments
Loans, guarantees and other
debts – non-current
Investments in fair value through
P&L
Total
Depreciation / impairment
Total
The Group owns 11% of the share capital of China Biznetwork Corp, which owns 14% of Viadeo
S.A.'s shares. China Biznetwork Corp shares are presented under the line item “Investments available
for sale”.
Since these shares are an investment in equity instruments not traded on an active market and whose
fair value cannot be reliably measured, they are measured at cost at 1 January 2012, 31 December
2012 and 31 December 2013. There were no indications of an impairment loss.
Non-current financial assets are mostly made up of deposits paid under operating leases for offices.
Investments (€452K) are securities pledged as a debt guarantee for the payment of rent for the Group’s
registered headquarter. This account is frozen for the term of the commercial lease.
224
7.2. Non-current tax receivables
Non-current tax receivables correspond to the share of the research tax credit refundable over more
than one year.
The tax credit is deducted from the corporation tax payable for the year in which the company presents
its research expenses.
The remaining amount constitutes a receivable towards the State which can be used against income
taxes payable over the three years following that for which the credit was recognised.
At the end of the allocation period, the unallocated portion may be recovered by the company.
Change in research tax credit
Receivable at 1 January 2012
(euros 000)
663
Reimbursed or offset in 2012
Recognised during 2012 financial year
Receivable at 31 December
0
735
1 398
Reimbursed or offset in 2013
663
Recognised during 2013 financial year
783
Receivable at 31 December
1 518
of which current
of which non-current
0
1 518
Furthermore, non-current tax receivables also include the “CICE” at 31 December 2013 in the amount
of €109K.
Note 8: Trade and other receivable
8.1 Trade and other receivables
(euros 000)
Trade receivables
2013
2012
1 January
2012
5 791
4 999
4 759
Tax receivables (excl. corporate income tax)
238
700
265
Other current receivables
239
308
258
6 268
6 007
5 282
(45)
(150)
(137)
6 223
5 857
5 145
Gross total
Impairment of trade debtors and related receivables
Net total
Depreciation is determined on the basis of a risk assessment carried out by the management of each
subsidiary and reviewed at Group level.
The trade receivables presented above include amounts that are due at each reporting date and for
which the Group did not account any significant depreciation for doubtful accounts given that the
credit rating of these debtors did not change significantly and that these amounts are still considered
recoverable.
225
8.2 Transfer of financial assets
The Group factors debt recovery; in this context, it disposed of €11,458K in trade receivables during
the fiscal year in exchange for a cash amount of €11,002K. Since the Group did not transfer all of the
risks and benefits associated with these trade receivables, it continues to recognise their full carrying
value and it recognised the cash amount received at the time of disposal as a secured loan (see Note
12).
At each reporting date, the carrying amount of trade receivables that were disposed of but not yet
recovered was €2,720K (against a liability of €2,065K at 31/12/2012), and the carrying amount of the
corresponding liability was €2 million (against an asset of €120K at 31/12/2012).
8.3 Other receivables and accruals
Other receivables and accruals consist of prepaid recurring expenses.
Prepaid expenses relate to recurring expenses and correspond mainly to the share of rent relating to the
next fiscal year.
Note 9: Cash, cash equivalents and current financial instruments
9.1 Cash and cash equivalents
Cash and cash equivalents are broken down as follows:
(euros 000)
Marketable securities
Net total
2013
2012
3 566
11 244
1 January
2012
3 570
1 031
7 026
0
4 597
18 269
3 570
Cash is made up of cash in bank, while cash equivalents are made up of liquid and risk-free
investments (OPCVM, Sicav, short-term investments).
No impairment of investments was accounted for.
Note 10: Financial assets and liabilities and their effects on profit or loss
Measurement of the fair value of financial assets and liabilities
Financial instruments are broken down into the following categories:
226
Financial assets and liabilities at
31 December 2013
(euros 000)
Non-current financial assets
Financial
assets
available for
sale
240
Investment Financial
at fait value liabilities BalanceLoans and
through
at
sheet
receivables
profit and amortized amount
loss
cost
1 093
452
Fair
value
1 786
1 786
6 223
6 223
4 597
4 597
0
12 606
12 606
Non-current financial debt
1 072
1 072
1 072
Current financial liabilities
2 473
2 473
2 473
10 282
10 282
10 282
13 827
13 827
13 827
6 223
3 566
1 031
10 883
1 483
Total financial assets
Total financial liabilities
Financial assets and liabilities at
31 December 2012
(euros 000)
240
0
Financial
assets
available for
sale
246
0
0
through
at
sheet
receivables
loss
cost
807
Fair
value
452
1 505
5 857
5 857
18 269
18 269
0
25 630
25 630
1 421
1 421
1 421
560
560
560
9 358
9 358
9 358
11 339
11 339
11 339
5 857
11 244
7 026
17 907
7 478
246
0
Financial
Financial assets and liabilities on
assets
1 January 2012
available for
(euros 000)
sale
246
0
0
through
at
sheet
receivables
loss
cost
714
452
1 505
Fair
value
1 412
1 412
5 145
5 145
5 145
3 570
3 570
3 570
0
10 127
10 127
2 574
2 574
2 574
2 215
2 215
2 215
7 163
7 163
7 163
11 952
11 952
11 952
246
0
9 429
0
227
452
0
Due to their short-term nature, the carrying amount of cash credit, trade and other payables and shortterm borrowings is an estimate of their fair value.
Available-for-sale financial assets are investments in equity instruments not traded on an active market
and whose fair value cannot be reliably measured; they are thus measured at cost at 31 December 2012
and 31 December 2013. There were no indications of an impairment loss.
Analysis of financial assets and liabilities measured at fair value
Financial assets measured at fair value in the balance sheet:
31 December 2013
(euros 000)
Investments at fair value through P&L
Investments held long-term
Level I
Level 2
452
31 December 2012
(euros 000)
240
1 January 2012
(euros 000)
240
1 031
Level I
1 031
Level 2
Level 3
452
246
7 026
Level I
Level 2
Level 3
0
228
Total
452
246
Financial assets at fair value through P&L
246
7 026
452
Investments available for sale recognised at fair
value
Investment in CBC
Total
452
value
Investment in CBC
Total
452
value
Investment in CBC
Level 3
246
0
Note 11: Share capital
11.1 Share capital issued
Share capital amounts to one hundred and ten thousand, three hundred and seventy-three euros and
fifty-five cents (€110,373.55).It is divided into 315,353 shares fully subscribed for and paid up at a
face value of €0.35.
This excludes unexercised warrants (“BSA”) and share options granted to certain investors and certain
individuals who may or may not be Company employees.
Statement of changes in equity:
Number of
shares
€
Position at 1 January 2012
262 828
91 989,80
Issue of new shares
Exercise of share warrants (BSA)
50 871
630
404
17 804,85
220,50
141,40
Position at 31 December 2012
314 733
110 156,55
Exercise of share warrants (BSA)
215
405
75,25
141,75
Position at 31 December 2013
315 353
110 373,55
Exercise of founders' share warrants (BSPCE)
Exercise of founders' share warrants (BSPCE)
Management of share capital
The Company’s policy is to maintain a solid equity so as to maintain investors and creditors
confidence and to support future business development.
11.3 Warrants (“BSA”)and share options
Warrants (“BSA”)
Creation
Expiry date
Stock warrants in circulation at 1 January 2012
Cancelled or lapsed warrants
Exercised warrants
Warrants in circulation at 1 January 2013
Exercised warrants
Warrants in circulation at 31 December 2013
Soocial share warrant
BSA 01 share subscription scheme
28/10/2011
30/06/2008
-
30/06/2013
809
200
(404)
405
200
(200)
(405)
0
0
Founders’ share warrants (in French: BCE, or Bons de souscription de parts de Créateurs
d’Entreprises)
Summary table of founders’ warrants granted during the period and in previous periods:
229
BCE 01 - Founders warrants BCE 02 - Founders warrants BCE 03 - Founders warrants BCE 04 - Founders warrants
BCE 05 - Founders warrants
Creation
EGM
27/8/2007
EGM
27/8/2007
EGM
6/7/2009
EGM
30/6/2010
EGM
29/6/2012
Initial maturity
date
31/08/2012
31/12/2012
31/12/2014
31/12/2017
10/9/2022
18/6/2023
17/12/2023
-
-
-
expiring date extended to
expiring date extended to
Modified maturity
31/8/2017 by EGM resolution of 31/8/2017 by EGM resolution of
date
29/6/2012
29/6/2012
Quantity
allocated
Characteristics
28 466
7 846
8 245
9 180
15 000
subscription right for a share
issued at the unit price of
€167.35
€167.35
€209.19
€250.35
issued at the unit price of €476.66
Present as employee or
corporate officer
corporate officer
corporate officer
corporate officer
Present as employee or corporate
officer
Exercisable immediately
The BCE 02 warrants can be
exercised by their holders (i) for
the first third of the subscribed
number from the 3rd anniversary
date of the holder's employment
contract, for a second third from
the 4th anniversary date of the
holder's employment contract,
and for the last third from the 5th
anniversary date of the holder's
employment contract, up to 31
December 2017 and (ii)
providing they are employees of
the company on the exercise
date.
The BCE 03 warrants can be
exercised by their holders (i) for
the first third of the subscribed
number from the 3rd anniversary
date of the holder's employment
contract, for a second third from
the 4th anniversary date of the
holder's employment contract,
and for the last third from the 5th
anniversary date of the holder's
employment contract, up to 31
December 2014 and (ii) providing
they are employees of the
company on the exercise date.
Management
Management / Employees
Conditions for
exercise
Vesting period
Beneficiaries
Series of options
Number of
options
granted
BCE 01 - Founders warrants*
28 466
BCE 02 - Founders warrants*
7 846
8 245
9 180
granting
date
15 000
27/08/2007
6/12/2007
4/2/2008
20/2/2008
9/9/2009
10/3/2010
5/7/2011
18/10/2011
14/12/2011
29/12/2011
10/09/2012
Total
68 737
-
The BCE 04 can be exercised by
their holders (i) for the first third
The Beneficiary can exercise the
of the subscribed number from
BCE 05:
the 1st anniversary date of the
- for a first third from the 1st
subscription form, for a second
anniversary of the allotment
third from the 2nd anniversary
- for a second third from the 2nd
date of the subscription form,
anniversary of the Allotment
and for the last third from the 3rd
- for the balance from the 3rd
anniversary date of the
anniversary of the Allotment and ii)
subscription form up until 31
providing they are employees or
December 2017 and (ii)
corporate officer of the Company
providing they are employees or
on the exercise date.
corporate officer of the Company
on the exercise date.
Expense for the 2012
financial year (euro 000)
Expense for the 2013
financial year (euro 000)
31/08/2017
167,35 €
245,01 €
482
-
31/12/2017
167,35 €
273,04 €
86
-
31/12/2014
209,19 €
69,53 €
45
8
31/12/2017
250,35 €
95,14 €
184
71
10/09/2022
476,66 €
209,83 €
-
893
-
-
-
798
972
Expiring date
Exercise price Fair value on the grant date
* The expiring dates of BCE 01 and BCE 02 were extended by the extraordinary general shareholders' meeting of 29/06/2012. The fair value
of the options indicated in the above table corresponds to that of the extended options (on the date the plans were amended).
Extending the exercise period of the BCE 01 and BCE 02 plans increases their fair value measured
immediately before and after the change.
In accordance with IFRS 2, the Group included the allocated marginal fair value in measuring the
amount recognised for services received in consideration of the granted equity instruments.
The allocated marginal fair value is the difference between the fair value of the modified equity
instrument and the fair value of the original equity instrument, both measured at the date of the
amendment.
Expenses related to BCE 01 and BCE 02 in the 2012 fiscal year correspond to the marginal fair value
of these two options recognised fully and immediately in profit or loss.
230
Change in options for the 2012 and 2013 fiscal years
BCE 01 - Founders warrants BCE 02 - Founders warrants
28 466
Warrants granted during financial year
Exercised warrants
28 466
Warrants granted during financial year
Exercised warrants
Warrants in circulation at 31 December 2013
28 466
BCE 03 - Founders warrants BCE 04 - Founders warrants BCE 05 - Founders warrants
5 412
8 065
9 180
(582)
(630)
(1160)
(3285)
4 200
6 905
5 895
(120)
(611)
(69)
(849)
(26)
4 080
6 225
5 020
5 000
5 000
10 000
15 000
Methods of measurement
The fair value of the warrants was measured according to the Black & Scholes model. Where relevant,
the fair value of the options was adjusted in view of Management’s best estimate of the effect of
restrictions on their exercise and handling. The expected volatility is based on the historical price
volatility of similar shares.
Model data
Share price on granting date
Exercise price
Assumption for turnover rate
Volatility
Non-transferability discount
BCE 01 - Founders warrants BCE 02 - Founders warrants
476,66 €
167,35 €
1,34%
20%
39,72%
15%
BCE 03 - Founders warrants BCE 04 - Founders warrants BCE 05 - Founders warrants
476,66 €
167,35 €
1,40%
20%
39,72%
15%
209,19 €
209,19 €
2,94%
20%
39,72%
15%
250,35 €
250,35 €
3,37%
20%
39,72%
15%
476,66 €
476,66 €
2,72%
20%
39,72%
15%
No future dividend payments were taken into account when measuring the fair value of the share
warrants.
231
Note 12: Loans and other financial liabilities
Financial liabilities are composed as follows:
(euros 000)
Convertible bonds - debt component
1 January
2012
Subscription
Currency
Assignment Discounting of
31 December
translation
and transfer
the debt
2012
differences
Redemption
1 129
-
(1 129)
-
-
-
0
Borrowings from credit institutions
765
308
(44)
(409)
-
(5)
614
Coface advance
332
265
-
(12)
-
-
585
Oseo advance
350
-
-
(145)
16
-
221
NON-CURRENT COSTS
2 574
573
(1 173)
(566)
16
(5)
1 421
Factor debt
Borrowings from credit institutions share < 1 year
Coface advance
Oseo advance
1 821
-
(1 821)
-
-
-
-
206
-
(191)
409
-
(7)
418
104
-
(120)
12
145
-
-
12
129
Bank overdrafts (cash liability)
83
-
(82)
-
-
0
0
Current Bank overdrafts (debt)
-
-
-
-
-
-
-
Accrued interest on borrowings
-
1
-
-
-
-
1
2 215
-
(2 214)
566
-
(7)
560
Other borrowings and similar debts
CURRENT
(euros 000)
31 December
Subscription
2012
Currency
Assignment Discounting of
31 December
translation
and transfer
the debt
2013
differences
Redemption
0
-
-
-
-
-
0
614
0
(224)
(139)
-
(4)
247
Coface advance
585
132
-
Oseo advance
221
(125)
11
NON-CURRENT COSTS
Factor debt
Borrowings from credit institutions share < 1 year
Coface advance
Oseo advance
718
108
1
1
1 421
132
(224)
(264)
11
(4)
1 072
-
2 000
-
-
-
-
2 000
418
-
(192)
139
-
(10)
355
(12)
(140)
125
-
3
-
-
(0)
12
129
113
0
-
-
-
-
-
-
-
-
1
-
-
-
-
1
560
2 000
(341)
264
-
(10)
2 473
CURRENT
232
3
12.1 Convertible Bonds
Bonds convertible into shares or repayable in cash
Bonds convertible into Viadeo shares were issued on 28/10/2011 at a face value of €1,584K (1,648
convertible bonds at €960.96 each) as payment for Viadeo's acquisition of 100% of Soocial's shares.
The maturity date of the convertible bonds is 31 July 2013.
Characteristics of the ORAN
Amount of issue
Bond nominal
Issue premium
Number of bonds issued
Interest rate
1 583 662,1 €
0,35 €
960,61 €
1 648
0,00%
Redemption price
720,57 €
Conversion price
960,96 €
Number of shares to create if conversion
1 648
In accordance with IAS 32, compound instruments issued by the company are accounted for in a
specific manner.
When an instrument has both a liability and an equity component, the face value of the instrument is
broken down into the fair value of the liability component, obtained on the basis of a market interest
rate reflecting payment without an equity component, and the value of the equity component, obtained
by deducting the liability component from the issuance value of the instrument as a whole.
The liability component is depreciated using the amortised cost method. An effective interest rate of
3.25% was applied.
The equity component, representing the conversion option granted to convertible bondholders, is
presented in the caption “Consolidated reserves and earnings” of the equity .
(euros 000)
Proceeds of issue
1 584
Liability component on issue date
(1 123)
Equity component
461
Liability component on issue date
1 123
Interest recognised as expense calculated at the
effective interest rate of 3.25%
Interest paid
6
-
Liability component at 1 January 2012
1 129
Interest recognised as expense calculated at the
effective interest rate of 3.25%
Additional interest allowing for early redemption
Liability component at 9 May 2012
13
46
1 187
The bond was fully redeemed on 9 May 2012 for a total amount of €1,187K.
233
12.2 OSEO Advances
On 26 June 2009, Viadeo obtained non-interest-bearing refundable innovation financing from OSEO71
in the amount of €490K to finance the development of the Viadeo interface.
The amount was paid in instalments between 2009 and 2011. It is repayable in sixteen quarterly
instalments between 2012 and 2015.
At 31 December 2013, €260K had been repaid, of which €120K for 2012 and €140K for 2013. The
balance of €230K will be repaid as follows:


€120K in 2014, in four quarterly instalments of €30K;
€110K in 2015, in four quarterly instalments of €27,5K.
The share of advances repayable over more than one year is recorded under “Non-current financial
liabilities”, while the share repayable over less than one year is recorded under “Current financial
liabilities”.
Under IFRS, the fact that the refundable advance is not subject to annual interest payments amounts to
viewing it as a zero per cent interest loan, i.e. more favourable than what is available on the market.
The difference between the advance amount at historical cost and the advance amount discounted at a
market rate (3.6 basis points) is considered as a State subsidy.
12.3 COFACE advances
Viadeo obtained refundable advances from COFACE72for two “business development insurance”
contracts covering the “AFRICA” and “INDIA & MEXICO” regions. Each contract provides cover to
Viadeo for three years during which the company's business development expenses are underwritten
within the limits of a defined budget.
A four-year redemption period subsequently begins during which Viadeo must repay the advance
obtained on the basis of a percentage of the turnover achieved in the regions concerned.
Under IFRS, the fact that the refundable advance is not subject to annual interest payments amounts to
viewing it as a zero per cent interest loan, i.e. more favourable than what is available on the market.
The difference between the advance amount at historical cost and the advance amount discounted at a
market rate is considered immaterial.
Note 13: Provision
13.1 Employee benefits
Employee benefits are made up of the provision for retirement benefits measured on the basis of the
provisions laid out in the collective agreement in force, in this case the SYNTEC collective agreement.
This obligation only concerns employees covered by French law. Commitments in relation to
employees of foreign subsidiaries are immaterial in view of local legal and regulatory provisions.
The main actuarial assumptions used to measure lump sum payments on retirement are as follows:
71
a French public investment body now part of Bpifrance
72
a global credit insurer based in France
234
31 December 2013
Discount rate
31 December 2012 1 January 2012
3,17%
2,69%
Retirement age
4,60%
67 years
Annual increase in salaries
4%
Mortality rate
INSEE 2004-2006
Staff rotation
26% declining according to age
The provision for retirement benefits developed as follows:
Change
(euros 000)
Retirement
obligation
Cost of
services
rendered
Financial
cost
Balance at 1/1/2012
46
Impact on operating income
15
13
2
Other elements affecting comprehensive income
27
0
0
Balance at 31/12/2012
88
Impact on operating income
33
30
2
Other elements affecting comprehensive income
(17)
0
0
Balance at 31/12/2013
103
Actuarial
differences
27
(17)
13.2 Provisions
The following tables show changes in current and non-current provision for the two periods:
(euros 000)
1 January
2012
Provisions for pensions and retirement benefits
Provisions for contingencies
Other provisions for liabilities – non-current
Provisions for losses on contracts – non-current
Provisions for restructuring – non-current
Total non-current provisions
46
39
0
0
0
85
Additions
15
0
0
0
0
15
Other
Currency
components of
31 December
Reversals*
translation
comprehensive
2012
differences
income
0
27
0
88
(5)
0
(2)
33
0
0
0
0
0
0
0
0
0
0
0
0
(5)
27
(2)
120
* Of which reversals used: €5K.
(euros 000)
1 January
2012
Provisions for losses on contracts – current
Provisions for restructuring – current
Total current provisions
0
13
0
13
Additions
0
290
0
290
235
Other
Currency
31 December
Reversals* components of translation
2012
comprehensive differences
income
0
0
0
0
(13)
0
0
290
0
0
0
0
(13)
0
0
290
(euros 000)
31
December
2012
Provisions for pensions and retirement benefits
Other provisions for liabilities – non-current
Provisions for losses on contracts – non-current
Provisions for restructuring – non-current
Total non-current provisions
88
33
0
0
0
120
Additions
33
0
0
220
0
253
Reversals*
0
(24)
0
0
0
(24)
Other
Currency
31 December
components of
translation
2013
comprehensive
differences
income
(17)
0
103
0
(3)
6
0
0
0
0
0
220
0
0
0
(17)
(3)
330
(euros 000)
31
December
2012
Provisions for losses on contracts – current
Provisions for restructuring – current
Total current provisions
0
290
0
290
Additions
176
499
0
675
Other
Currency
components of
31 December
Reversals*
translation
comprehensive
2013
differences
income
0
0
0
176
(290)
0
0
499
0
0
0
0
(290)
0
0
675

Provision for contingencies
o at 31/12/2012, provisions for contingencies included a provision of €257K for the
closure of subsidiaries in Italy and Spain. This provision was fully reversed in 2013;
o at 31/12/2013, provision for liability es mostly corresponded to redundancy pay for
contractual termination of employment contracts entered into with certain employees.

Provision for losses on contracts: provision for losses on contracts recorded at 31/12/2013 (a
total of €396K) corresponds to rents to be paid for unused premises in France for the
remainder of the lease term.
Note 14: Trade and other payables
Trade and other payables were not discounted to the extent that amounts were not overdue by more
than one year at the end of the fiscal year in question.
2013
2012
(euros 000)
Supplier payables
Current welfare payables
Tax debt (excl. Corporate income tax and CVAE tax on corporate added value) - current
Total trade and other payables
4 215
2 924
3 128
15
3 390
2 910
2 810
248
2 940
2 153
1 749
322
10 282
9 358
7 163
Note 15: Other current and non-current liabilities
Other non-current liabilities are broken down as follows:
(euros 000)
Debts on purchases of non-current assets - non current
Other non-current liabilities
Deferred income
Total other non-current liabilities
2013
2012
792
916
792
916
236
1 January
2012
1 January
2012
597
597
Other current liabilities are broken down as follows:
(euros 000)
Current payables on acquisitions of non current assets
Deferred income
Customers – advances and down payments received
2013
2012
7 973
9 174
156
2
Total other current liabilities
8 129
9 176
1 January
2012
7 200
7 200
The Viadeo Group is led to record deferred revenue relating to invoice issued in order to link revenue
to the corresponding period of services rendered.
Note 16: Staff and staff expenses
Staff costs are broken down as follows:
(euros 000)
31 December
2013
31 December
2012
(447)
(371)
(34)
(28)
(15 841)
(13 362)
(6 867)
(5 586)
15
(52)
-
-
(23 174)
(19 399)
Tax and payroll levies
CET
Staff compensation
Social Security and employee benefit charges
Other staff expenses (company profit-sharing agreement)
Employee profit sharing
Total
The following table lists a head count of Group staff by function:
Group staff
Management and support function
Production function
Marketing and sales function
2013
66
210
171
447
237
2012
63
179
148
390
Note 17: Other external expenses
The following are other external expenses:
31 December
2013
31 December
2012
Payments to intermediaries & fees
(3 445)
(2 724)
Hire and rental charges
(2 592)
(1 892)
Hosting maintenance
(655)
(619)
General sub-contract work
(494)
(316)
Purchases of materials and supplies not stored
(483)
(408)
(1 319)
(1 423)
Outside assignment and reception costs
(401)
(181)
Postage expenses
(573)
(437)
Banking services
(216)
(211)
(497)
(896)
Other taxes
(127)
(92)
Miscellaneous
(207)
(340)
(11 009)
(9 537)
(euros 000)
Travelling costs - transport
Total
“Payment to intermediaries & fees” includes part of the compensation to executive officers through
service provision agreements.
Note 18: Other recurring operating income and expenses
Other recurring operating income and expenses are broken down as follows:
(euros 000)
31 December
2013
31 December
2012
788
752
(297)
(146)
Operating subsidies (Research Tax Credit)
Gains or losses on disposals of assets
Other exceptional expenses
(5)
(3)
Miscellaneous
(69)
34
Other operating income and expenses
418
637


Note 19: Depreciation and provision expenses
Depreciation and provision expenses are broken down as follows:
31 December
2013
31 December
2012
Intangible assets amortisation & impairment expense
(3 601)
(3 140)
Tangible assets amortisation & impairment expense
(799)
(580)
(euros 000)
Amortisation of deferred operating charges
Operating provisions expense
Retirement commitment provisions expense
Reversal of unused operating provisions
Total
238
-
-
(894)
(34)
(33)
(15)
43
13
(5 284)
(3 756)

Note 20: Non-recurring operating income
Non-recurring operating income is broken down as follows:
(euros 000)
Site closure costs
Impairment
Non-current operating income
31 December
2013
31 December
2012
(92)
(257)
-
-
(92)
(257)
During the 2012 fiscal year, the Group recorded a provision of €257K for the closure of subsidiaries in
Italy and Spain.
The costs of closure incurred in 2013 amounted to €274K and involved Italy, Spain, India, Mexico
and Senegal.
The “site closure costs” also include the net value of the assets and liabilities of the subsidiaries
liquidated in the amount of €73K.
239
Note 21: Net financial income or loss
The financial profit or loss is broken down as follows:
31 December
2013
31 December
2012
59
130
148
138
Income from disposals & other income./ Cash equivalents
-
-
Change in fair value (income)
-
-
Other financial income
3
1
Financial income
210
269
Interest costs on borrowings
(39)
(79)
(374)
(326)
Other financial costs
(14)
(4)
Discounting effects
(11)
(75)
Financial costs
(439)
(484)
(229)
(216)
(euros 000)
Income from financial assets (excl. cash equivalents)
Foreign exchange gains
Foreign exchange losses
Note 22: Corporation tax
According to current legislation, at 31 December 2013 the Company had tax losses carried forward
amounting to:
 €8,605K in indefinite tax loss carry-forwards in France;
 US$9,760K (€7,077K) carried forward over 20 years in the US;
 CNY 105,749K (€12,665K) carried forward over 5 years in the People's Republic of China.
The carrying amount of deferred tax assets is reviewed at each reporting date on the basis of a threeyear tax planning period. The Group did not recognise deferred tax assets for France and China. The
Group only recognised tax loss carry-forwards for the APVO subsidiary, which had a €3,032K impact
on deferred tax assets. This activation is justified by the forecasted taxable profits generated in the next
three fiscal years.
The principal items comprising the income tax expense and the reconciliation between the theoretical
tax expense calculated at the effective tax rate in France (33.33% in 2013 and 2012) and the actual tax
expense recognised in the consolidated income statement are presented below:
Detailed tax benefit (expense) in profit or loss
Tax on profits, euros 000
31 December 2013 31 December 2012
Current tax
Deferred tax
Corporate income tax
240
(299)
1 924
(253)
4 227
1 624
3 974
Reconciliation between theoretical tax and effective tax
(euros 000)
Profit (loss) before tax
Group tax rate
Theoretical tax expense
Permanent differences
Tax losses not recognized as tax assets
Activation of previously unrecognised loss carry-forwards
CVAE (tax on corporate added value)
Recognition of previously unrecognised loss carried-forward
Others
Differences in taxation rates
Actual tax charge
2013
(14,745)
33.33%
(4,915)
(257)
3 055
(22)
292
0
1
222
(1,624)
2012
(8,783)
33.33%
(2,928)
89
2 222
(1,103)
155
(1,652)
10
(768)
(3,974)
Permanent differences include the impact of the Research Tax Credit.
During the fiscal year, previously unrecognised loss carryovers were used in the amount of €22K.
Nature of deferred taxes
Net balance sheet position
(euros 000)
31 December 2013 31 December 2012
1 January 2012
Tax loss carry-forwards
Temporary differences on goodwill and on
intangible assets
Retirement commitments
Other temporary differences
Sub-total deferred tax asset
3 142
1 987
524
1 438
1 733
0
34
1 100
5 713
29
730
4 480
0
225
749
Amortisation relating to tax rules
Revaluation reserve
Other temporary differences
Sub-total deferred tax liability
(228)
(286)
(50)
(565)
(183)
(572)
(234)
(989)
(123)
(858)
(400)
(1,381)
Total net deferred taxes on balance sheet
5 149
3 492
(632)
Deferred tax assets
5 460
(312)
3 941
(449)
0
(632)
Temporary differences on goodwill and intangible assets are linked to the tax basis of intangible assets
arising from intercompany sales and then cancelled in consolidation on the one hand, and to the taxdeductible nature of an intangible asset on the other hand.
Changes in deferred taxes between the previous fiscal year and the current fiscal year are fully
recognised in the income statement in the amount of €1,924000 and through the currency exchange
difference in the amount of -€267K.
241
Note 23: Off-balance sheet commitments
23.1 Operating lease obligation
The Company signed a standard 3/6/9 period lease for its registered office in France. This type of lease
is granted for nine full consecutive years and gives the company the option to give notice once every
three years73.
Future rent and expenses relating to the headquarters until the end of the next three-year period are
broken down as follows at 31 December 2013:
 for less than one year: €963K;
 for more than one year and less than five years: €1,887K.
Rent recognised as an expense during the fiscal year ended 31 December 2013 amounted to €869K.
The Group signed two leases for its business in China (Tianji). The leases were granted for three full
consecutive years.
Future rent and expenses relating to the premises in China are broken down as follows at 31 December
2013:
 for less than one year: €441K;
 for more than one year and less than five years: €362K.
Rent under this lease expensed during the fiscal year ended 31 December 2013 amounted to €523K.
The Group signed one lease for its premises in the United States. It was granted for a term of twelve
months. Future rent and expenses are broken down as follows at 31 December 2013:
 for less than one year€75K;
 for more than one year and less than five years: €0.
23.2 Pledge and other security interests
The Viadeo Group pledged investments in the amount of €452K as warranty against the lease for its
headquarters. These investments are presented under non-current financial assets.
The Viadeo Group pledged its goodwill as security against the repayment of a bank loan in the amount
of €242K recognised in the liabilities caption of the consolidated balance sheet. At 31 December 2013,
the Viadeo Group complied with all of the banking covenants relating to the loan.
23.3 Other off-balance sheet commitments
The Company acquired the “Peak” software programme. This asset was acquired for €1 including a
price review clause based on a percentage of the revenue generated by the application until 31 March
2014.
At 31 December 2013 and 31 March 2014, no additional price was acknowledged in view of the
amount of revenue generated by the application.
73
i.e. after three and six years
242
Note 24: Relationship with related parties
The Viadeo Group’s related parties consist of:
- the Group’s executive officers;
- the Group’s directors;
- the companies in which the above exercise control, joint control or significant influence, or
hold significant voting rights.
24.1 Compensation for executives and senior executives
Senior executives receive compensation in the form of short-term employee benefits and share-based
payments.
The amount of fixed and variable compensation allocated to executives for 2013 and the number of
shares relating to all plans in place at 31 December 2013 are presented below:
(euros 000)
Gross remuneration and benefits in kind
Services rendered
Post-employment benefits
Retirement indemnities
Cost of option plans and similar schemes
Total expenses recognised in the consolidated income statement
2013
2012
837
389
923
440
303
482
1 529
1 844
“Compensation and benefits in kind” include compensation for corporate offices, salaries and
directors' fees, as well as benefits in kind linked to the expatriation of one of the executives.
“Services rendered" corresponds to fees charged by KDS Associés and Kadomi, two companies linked
to the executives under service provision agreements. Regarding the fees paid to KDS Associés, a
company linked to Mr. Dan Serfaty, the amounts listed in the table above (i.e. €115,500 for 2012 and
€67K for 2013) only correspond to the share of services provided by Mr Dan Serfaty, Chairman and
Managing Director of Viadeo SA. As for the fees paid to Kadomi, the amounts listed in the table
above (i.e. €324K for 2012 and €322K for 2013) only relate to services provided by Mr. Thierry
Lunati, Deputy Managing Director of Viadeo SA.
24.2 Transactions with related parties
Balances and transactions between the Company and its subsidiaries that are related parties were
eliminated at consolidation level and are not presented in this Note. Details of transactions between the
Group and other related parties are presented below.
243
Transactions with joint ventures
with its joint-venture partners
31 December
31 December
2013
2012
(euros 000)
Equity interests
Loans
Trade payables and related accounts
Operating income
Financial income
Operating expenses
Financial expenses
17
-
89
-
Note 25: Earnings per share
Basic earnings per share
Basic earnings per share is calculated by dividing the net profit (loss) attributable to Company
shareholders by the weighted average number of ordinary shares in circulation during the fiscal year.
Instruments giving deferred access to Share capital (warrants (BSA) and founders warrant (BSPCE))
are considered anti-dilutive since they result in increased earnings per share. Diluted earnings per
share is thus identical to basic earnings per share.
In € / share
31/12/2013
31/12/2012
(41.61)
0,00
(41.61)
(16.12)
0,00
(16.12)
Continuing operations
Discontinued operations
Total diluted earnings per share (€/share)
(41.61)
0,00
(41.61)
(16.12)
0,00
(16.12)
Average weighted numb er of ordinary shares for
calculating b asic earnings per share
315 353
298 330
Average weighted numb er of ordinary shares for
calculating diluted earnings per share
315 353
298 330
Basic earnings per share (€/share)
Continuing operations
Discontinued operations
Total basic earnings per share (€/share)
Diluted earnings per share (€/share)
The number of instruments giving deferred access to Share capital stood at 58,791 at 31 December
2013 (see note 11.2).
244
Note 26: Management of financial risks
The Group is exposed to the following risks related to the use of financial instruments:
 credit risk;
 market risk;
 liquidity risk.
This note presents information on the Group’s exposure to each of the above risks and to risks
resulting from early repayment clauses due to covenants, as well as on its objectives, policies and how
it measures and manages risks. Quantitative information can be found in other notes to the
consolidated financial statements.
The Company’s main financial instruments consist of financial assets, cash and investments. The
management of these instruments is aimed at financing the Company’s activities. It is Company policy
not to use financial instruments for speculation purposes. The Company does not use derivatives.
Credit risk
Credit risk is the risk of a financial loss to the Group if a customer or the counterparty to a financial
instrument fails to meet their contractual obligations.
Maximum exposure to credit risk at the end of each fiscal year is represented by the carrying amount
of the financial assets and summarised in the following table:
(euros 000)
31.12.2013
1 786
Book value
31.12.2012
1 505
1.1.2012
1 412
Trade receivables and related accounts
6 223
5 857
5 145
Other operating receivables
2 245
2 048
1 110
4 597
18 269
3 570
14 851
27 678
11 238
Total

Trade receivables
A credit risk exists if a customer cannot honour their commitments within the agreed due dates,
resulting in a potential loss. The Group permanently monitors its customers’ credit risk.
Furthermore, the Group’s dependence on any given customer is limited as no single customer accounts
for more than 10% of Group revenue.
To determine the recoverability of a trade receivable, the Group takes into account any changes to its
credit rating from the date on which it was initially granted to the end of the end of the reporting date.
There is a limited risk of credit concentration as the customer base is diversified and unrelated.
Depreciation is determined on the basis of a risk assessment carried out by the management of each
subsidiary and reviewed at Group level, and is presented below for the 2012 and 2013 fiscal years:
1 January
2012
Additions
Change in
Reversals consolidation
scope
Other
changes
31 December
2012
(137)
Other receivables
0
(359)
0
345
0
0
0
0
0
(150)
0
Total
(359)
345
0
0
(150)
(137)
245
31
December
2012
Change in
Reversals consolidation
scope
Additions
Other
changes
31 December
2013
(150)
Other receivables
0
(66)
0
171
0
0
0
0
0
(45)
0
Total
(66)
171
0
0
(45)
(150)
On the basis of its experience and in view of its commercial loan recovery policy, the Group estimates
that the level of depreciation for the fiscal year matches the risk involved.
The following table summarises all late payments under the Trade and other receivables line item as
well as provisions accrued for disputes and defaults relating to billed customers:
(euros 000)
2013
2012
1 January
2012
Not past due receivables
3 672
2 529
3 118
Past due receivables – not impaired
Less than 60 days
From 60 to 90 days
From 90 to 120 days
More than 120 days
2 069
1 386
370
150
163
2 324
1 585
359
333
45
1 542
1 337
100
105
0
50
146
99
5 791
4 999
4 759
Impaired receivables
Total trade accounts receivable
Cash and cash equivalents consist exclusively of risk-free investments such as OPCVM, Sicav and
short-term investments. Investments are mostly made in Viadeo S.A.
Market risk
Market risk corresponds to the risk that price movements such as exchange rates and interest rates
affect the Group’s result. The management of market risk is designed to manage and control exposure
to market risk within acceptable limits, while optimising the profitability/risk ratio.
Interest rate risk
Interest rate risk is managed by the Group's Treasury department which is in charge of determining
subsidiaries' actual requirements and surpluses and arranging adequate external financing.
Foreign currency exchange risk
The Group is active internationally and is therefore subject to currency exchange risk originating from
various exposures in currencies other than the euro, which is its functional and presentation currency.
The operating income and assets of the Chinese and Russian entities in particular and the Group's cash
position are subject to exchange rate fluctuations – mainly fluctuations in the euro/yen and euro/dollar
rates.
Assuming a 5% rise in the value of the dollar, the Group estimates that the net impact on operating
income for the fiscal year ending 31 December 2013 would have been a profit of about €124K.
246
Assuming a 5% rise in the value of the yen*, the Group estimates that the net impact on operating
income for the fiscal year ending 31 December 2013 would have been a loss of about €19K.
Exposure to exchange rate fluctuations in the 2012 and 2013 fiscal years was limited in view of the
relative weight of the Chinese segment in the Group's accounts. Exposure to exchange rate fluctuation
in subsequent fiscal years might be limited naturally due to cash inflows and outflows in a single
currency.
The Group did not hedge any of its transactions in the periods presented.
Liquidity risk
To manage the liquidity risk that could result from financial liabilities falling due, whether at their
contractual due date or prematurely, the Group has implemented a prudent financing policy based in
particular on investing its surplus available cash flow into risk-free investments.
Liquidity risk management is handled by the Group's Treasury department, which provides adequate
short- or long-term financing to the Group’s subsidiaries.
Liquidity is optimised by centrally managing the cash surpluses and requirements of the Group’s
subsidiaries. This is done by means of intra-Group loans in compliance with local regulations. Surplus
consolidated cash position is managed with liquidity and yield optimisation in mind.
External financing is also managed centrally by the Group's Treasury department, thus allowing for
costs to be optimised.
Non-discounted contractual cash flows (principal and interest) on outstanding financial liabilities by
date of maturity are broken down as follows:
euros 000 - 31/12/2013
Coface advance
Oseo advance
NON-CURRENT COSTS
Factor debt
Balance-sheet
amount
247
718
108
1
1 072
2 000
+ one year
2 000
Borrowings from credit institutions - share < one year
355
367
Coface advance
Oseo advance
113
3
-
120
3
-
CURRENT
1
1
2 473
2 492
Four to
five years
267
718
110
1
1 095
-
> five
years
-
-
*
A material error appears in Note 26 to the Notes to the consolidated financial statements. In the paragraph "Foreign currency exchange
risk", reference is made to yuan and not yen.
247
euros 000 - 31/12/2012
Coface advance
Oseo advance
NON-CURRENT COSTS
Factor debt
Balance-sheet
amount
+ one year
614
585
221
1 421
-
-
418
432
Coface advance
Oseo advance
12
129
0
-
12
140
0
-
CURRENT
euros 000 - 1/1/2012
Four to
five years
> five
years
663
585
230
1
1
560
585
Balance-sheet
amount
+ one year
1 478
-
-
-
Four to
five years
1 129
1 187
Coface advance
Oseo advance
NON-CURRENT COSTS
Factor debt
765
332
350
2 576
1 821
830
332
370
1 821
206
215
Coface advance
Oseo advance
104
83
-
120
83
-
CURRENT
-
-
2 215
2 238
> five
years
2 720
-
-
-
Risks resulting from early repayment clauses relating to covenants
In December 2010, the Group took out a €450K loan from HSBC France redeemable on a monthly
basis over 60 months from the date on which it came into effect.
This loan contains clauses (covenants) requiring compliance with several financial provisions.
The clauses entail:
 Maintaining total equity of at least €15K;
 Maintaining an equity/total assets ratio of over 20%;
 Maintaining a financial expenses (corrected for lease financing)/EBITDA ratio lower than
30%.
Failure to comply with these covenants enables the lender to require early repayment of the loans. At
year-end, the Group complied with the ratios set out in the bank’s documentation.
248
Note 27: Statutory auditors’ fees
KPMG
(euros 000)
2013
2012
Grant Thornton
(euros 000)
As a %
2013
2012
2013
2012
As a %
2013
2012
Statutory auditors, certification of
individual and consolidated accounts:
- Issuer
22
27
63%
84%
22
27
63%
84%
-
-
0%
0%
-
-
0%
0%
13
5
37%
16%
13
5
37%
16%
-
-
0%
0%
-
-
0%
0%
35
32
100%
100%
35
32
100%
100%
- legal, tax, employee-related
-
-
-
-
-
-
-
-
- other
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
35
32
100%
100%
35
32
100%
100%
- Fully-consolidated subsidiaries
Other work and services directly
connected to the statutory auditor's
mission:
- Issuer
- Fully-consolidated subsidiaries
Total mandatory mission of the
statutory auditors
Other services provided by the network
to the fully-consolidated subsidiaries:
Total other services
Total
249
Note 28: Group scope of consolidation
2013 consolidated entities
Viadeo SA
Viadeo Ltd
Wayson ltd
Tianji Boren
Yingke
VIADEO RED PROFESIONAL
Apnacircle Infotech
VIADEO MEXICO
Sabri
Viadeo SEHQ
APVO Corp.
Viadeo Africa
Viadeo Maroc
Soocial
Viadeo independant Media BV
Viadeo independant Media LLC
2012 consolidated entities
Viadeo SA
Viadeo Ltd
Viadeo Italia
Viadeo GmbH
Wayson ltd
Tianji Boren
Yingke
VIADEO RED PROFESIONAL
Apnacircle Infotech
VIADEO MEXICO
Unyk
Sabri
Viadeo SEHQ
APVO Corp.
Viadeo Africa
Viadeo Maroc
Soocial
Viadeo independant Media BV
Viadeo independant Media LLC
Date of entry into
the consolidation
scope
2004
2007
2008
2008
2008
2008
2009
2009
2009
2010
2010
2011
2011
2011
2011
2011
Date of entry into
the consolidation
scope
2004
2007
2007
2007
2008
2008
2008
2008
2009
2009
2009
2009
2010
2010
2011
2011
2011
2011
2011
Internal
restructuring
Wound up in 2013
Wound up in 2013
Wound up in 2013
Wound up in 2013
Internal
restructuring
Merger in 2011
Wound up in 2011
Wound up in 2011
Method of entry
Country
Percentage
of control
Consolidation
method
Percentage
interest
N/A
Creation
Acquisition
Acquisition
Acquisition
Creation
Acquisition
Creation
Acquisition
Creation
Creation
Creation
Creation
Acquisition
Creation
Creation
France
United Kingdom
People's Republic China
Spain
India
Mexico
France
Italy
USA
Senegal
Morocco
Netherlands
Netherlands
Russia
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
50%
50%
Full consolidation
Full consolidation
Full consolidation
Full consolidation
Full consolidation
Full consolidation
Full consolidation
Full consolidation
Full consolidation
Full consolidation
Full consolidation
Full consolidation
Full consolidation
Full consolidation
Proportional
Proportional
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
50%
50%
Method of entry
Country
Percentage
of control
Consolidation
method
Percentage
of interest
N/A
Creation
Creation
Creation
Acquisition
Acquisition
Acquisition
Creation
Acquisition
Creation
Acquisition
Acquisition
Creation
Creation
Creation
Creation
Acquisition
Creation
Creation
France
United Kingdom
Italy
Germany
Spain
India
Mexico
Canada
France
Italy
USA
Senegal
Morocco
Netherlands
Netherlands
Russia
100%
100%
0%
0%
100%
100%
100%
100%
100%
100%
0%
100%
100%
100%
100%
100%
100%
50%
50%
Full consolidation
Full consolidation
Not consolidated in
Not consolidated in
Full consolidation
Full consolidation
Full consolidation
Full consolidation
Full consolidation
Full consolidation
Not consolidated in
Full consolidation
Full consolidation
Full consolidation
Full consolidation
Full consolidation
Full consolidation
Proportional
Proportional
100%
100%
0%
0%
100%
100%
100%
100%
100%
100%
0%
100%
100%
100%
100%
100%
100%
50%
50%
Tianji Boren Technology Development (Beijing) Co., Ltd. ("Boren"), the Group's wholly owned
Chinese subsidiary, concluded a series of contracts with Yingke and its two shareholders. This enabled
the Group, despite not having any interest or voting rights in Yingke, to exercise contractual control
over the latter, which is thus considered to be a variable interest entity under Chinese law and its
operating results are accordingly consolidated with those of the Group.
250
Note 29: Information on the transition to IFRS
29.1 Reconciliation of equity at 1 January 2012 and 31 December 2012 between French
GAAP and IFRS
(euros 000)
1 January
Non
2012 share of controlling
Group
interest
Equity capital, according to French GAAP
Employee benefits (IAS 19)
GW not amortised (IFRS 3)
Cancellation of nil values
Share-based payments (IFRS 2)
Conversion of convertible bonds
OSEO - IAS 39 / IAS 20
4 577
(46)
0
2012 flow
Wholly-owned Profit/loss for the year
Increase
Payments Non controlling
consolidated
for the financial year of capital
in shares
interest
1 January
2012
4 577
(4,409)
22 370
0
0
(46)
(15)
904
892
0
(1)
0
0
0
(798)
455
455
(455)
0
36
36
(16)
20
0
0
(29)
21
21
9
5 043
(4,809)
0
0
5 043
(4,809)
Total IFRS adjustments before tax
(12)
0
Other restatements
Effects of tax on IFRS adjustments (IAS 12)
(112)
(27)
Wholly-owned
consolidated 31
December
2012
22 426
(88)
(1)
Deferral of revenue
Total IFRS adjustments before tax
Statement of
Results
Global
5 043
0
0
5 043
0
(1)
798
0
(29)
22 370
798
22 370
798
0
0
(143)
(113)
(294)
23 108
0
0
(294)
23 108
“Other restatements” correspond mainly to the adjustment on the opening exchange differences of
foreign subsidiaries.
29.2 Reconciliation of the consolidated balance sheets at 1 January 2012 and 31
December 2012 between French GAAP and IFRS
Consolidated balance sheet at 1 January 2012
1 January
2012
CRC 99-02
ASSETS (euros 000)
Non-current assets
IFRS
restatements
1 January
2012 IFRS
16 371
21
16 392
Goodwill
5 403
20
5 423
Intangible assets
7 761
-
7 761
1 133
-
1 133
1 412
-
1 412
663
-
663
-
0
9 203
0
(41)
9 162
5 186
(41)
5 145
441
-
441
6
-
6
3 570
-
3 570
25 574
(20)
25 554
Deferred tax assets
Current assets
Tax asset - current
TOTAL ASSETS
251
1 January
2012
CRC 99-02
LIABILITIES (euros 000)
Share capital
Share premiums
IFRS
restatements
4 577
466
1 January
2012
5 043
92
-
92
21 759
-
21 759
(17 274)
466
(16 808)
-
6 154
(446)
4 886
(491)
Other provisions
5 708
4 395
39
46
85
632
0
632
597
597
14 844
(41)
14 803
7 163
-
7 163
394
-
394
13
-
13
Tax liability
32
-
32
7 241
(41)
-
7 200
25 574
(20)
25 554
Current liabilities
Consolidated balance sheet at 31 December 2012
31 December
2012
CRC 99-02
ASSETS (euros 000)
Non-current assets
IFRS
restatements
31 January
2012 IFRS
19 217
797
20 014
Goodwill
4 449
911
5 360
Intangible assets
7 281
(140)
7 141
1 328
(0)
1 328
1 505
-
1 505
739
-
739
3 915
3 941
25 439
26
(5)
25 434
5 861
(5)
5 857
637
-
637
Deferred tax assets
Current assets
Tax asset - current
TOTAL ASSETS
252
671
-
671
18 269
-
18 269
44 656
793
45 448
31 December
2012
CRC 99-02
LIABILITIES (euros 000)
Share capital
Share premiums
Own shares
Other reserves
IFRS
restatements
31 January
2012 IFRS
22 427
681
110
-
23 108
110
44 112
-
44 112
351
1 257
1 608
-
-
-
(21 795)
(21 114)
2 819
681
87
1 441
(20)
1 421
-
88
88
Provisions for contingencies and losses
33
-
33
Other provisions
33
88
120
429
20
449
916
916
19 409
25
19 434
9 395
(36)
9 358
560
-
560
290
-
290
-
Provisions for employee benefits
Current liabilities
Tax liability
253
2 906
21
30
50
9 144
32
9 176
44 656
793
45 448
29.3 Reconciliation of the consolidated income statements at 31 December 2012 between
French GAAP and IFRS
Consolidated statement of comprehensive income - euros 000
31 December
2012
CRC 99 02
IFRS
reclassifications
IFRS
restatements
31 December
2012
IFRS
15 938
0
0
15 938
B to B Recruitments
6 578
0
0
6 578
B to B sale of advertising space
3 916
0
0
3 916
B to B training
959
0
0
959
Other income
342
0
0
342
27 733
0
0
27 733
(22,189)
2 790
0
(19,399)
(3,089)
0
0
(3,089)
81
0
(9,537)
(1,810)
(425)
637
1 061
(425)
(3,665)
(798)
(798)
Staff expenses
(9,618)
2 871
Operating margin
(4,291)
0
0
(26)
(76)
0
Amortization and provisions expenses
(3,727)
(13)
(15)
(3,756)
(8,045)
(1,238)
(8,310)
972
0
Share-based payments reserved for founder shareholders
(102)
0
Site closure costs
(257)
0
0
Impairment of non-current assets
(904)
0
904
0
(1,161)
0
904
(257)
(9,205)
972
269
(257)
(334)
(8,567)
269
0
0
Financial expenses
(410)
0
(75)
(484)
(141)
0
(75)
(216)
0
0
0
0
0
0
0
0
Financial income
(9,347)
4 937
Tax charge on income
972
(409)
(972)
9
(8,783)
3 974
(4,409)
0
(400)
(4,809)
(4,409)
0
(400)
(4,809)
(4,409)
0
(400)
(4,809)
0
0
Attributable to
the Company's owners
0
254
0
29.4 Description of the main IFRS financial restatements
a. Amortisation of goodwill
The Viadeo Group chose not to restate business combinations that took place before 1 January 2012.
Moreover, in accordance with IFRS 3 Business Combinations, goodwill ceased to be amortised from 1
January 2012, which had a positive impact on the income statement of €904K.
There are moreover no indications of impairment loss; no impairment loss was thus accounted for in
the opening balance sheet at 1 January 2012 and in the accounts for the 2012 fiscal year.
b. Provision for retirement and similar benefits
As a provision for retirement indemnities is not compulsory under French GAAP, the application of
IAS 19 Employee Benefits led to the recording of a non-current liability of €46K at 1 January 2012
and €88K at 31 December 2012.
c. Development expenses
Development expenses incurred by the Viadeo Group’s research teams were already activated in the
consolidated accounts prepared according to French GAAP. They were not affected by the transition
to international standards.
d. Share-based payments and offers reserved for employees
According to French GAAP, no expenses are recorded when share options are granted to employees.
In contrast, IFRS 2 requires that an expense be recorded in consideration of services obtained under
share option plans (and similar plans) offered to employees.
Share option plans granted by the Viadeo Group to its employees between 2007 and 2012 led to record
an expense in the amount of €798K against equity for the 2012 fiscal year.
e. Separate measurement and recognition of the equity component and the liability
component of bonds convertible into Viadeo shares or redeemable in cash
In accordance with IAS 32, the equity component and the liability component of these bonds has to be
separately measured and recognised. The equity component is presented under shareholder equity
under the redemption premium on account of the bonds' conversion option.
As measured on 1 January 2012, the conversion option amounted to €461K. This is accounted under
equity (against reduction of the bond amount).
f.
Main reclassification in the balance sheet
The balance sheets were reclassified in order to comply with IFRS rules of presentation.
Deferred tax assets and liabilities are now presented under non-recurring items.
Provisions and liabilities with a maturity greater than 12 months were reclassified as non-current
liabilities.
255
g. Main reclassifications in the statement of profit or loss
Independent of the IFRS restatements outlined above, the aggregates of the income statement were
reclassified in order to align their presentation with IFRS rules. The main reclassifications at 31
December 2012 concern:
The breakdown of €428K of non-recurring income under French GAAP reclassified mainly into
staffing costs.
The reallocation of self-constructed assets (€2,887K) in reduction of the relevant expenses captions,
mainly staffing costs in the amount of €2,882K.
The reallocation of expense transfers (€90K) in reduction of the related expenses, i.e. staffing costs.
The reclassification of the CVAE74 (IAS 12) from operating expenses to income tax expenses for
€233K.
The reclassification of the research tax credit from income tax expense to other operating income
(operating grant received) for €739K.
74
a levy on corporate value added
256
20.2 PRO FORMA FINANCIAL INFORMATION
N/A
257
20.3 HISTORICAL FINANCIAL STATEMENTS of Viadeo S.A.
Since the Company prepared its consolidated accounts over the reference period, Viadeo S.A.’s
historical individual financial statements were not consolidated into the present document.
20.4 VERIFICATION
INFORMATION
OF
THE
ANNUAL
HISTORICAL
FINANCIAL
20.4.1 Statutory auditors' report on the consolidated accounts for the fiscal years
ended 31 December 2013 and 2012
Viadeo S.A.
Regsitred Office : 30, rue de la Victoire – F 75009 Paris
Share capital : € 110,374
This is a free translation into English of a report issued in French and is provided solely for the convenience of Englishspeaking readers. This report should be read in conjunction with, and is construed in accordance with, professional auditing
standards applicable in France.
“To the attention of the board of directors,
In our capacity as Statutory auditors of Viadeo S.A. and in accordance with (EC) Regulation
No. 809/2004 within the context of the contemplated public offering and admission of the Company’s
shares to trading on the regulated market of Euronext Paris, we have audited the accompanying
consolidated financial statements of Viadeo S.A. for the years ended 31 December 2012 and 2013
presented in accordance with IFRS as adopted by the European Union (hereinafter the “ Financial
Statements”) which are attached to this report.
These Consolidated Accounts are the responsability of the board of directors. Our responsibility is to
express an opinion on these “financial statements” based on our audit.
We conducted our audit in accordance with professional standards applicable in France. Those
standards require that we plan and perform the audit to obtain reasonable assurance whether the
Financial Statements are free from material misstatement. An audit involves performing procedures,
on a test basis or by other means of selection, to obtain audit evidence about the amounts and
disclosures in the “financial statements”. An audit also includes assessing the accounting policies used
and significant estimates made by management, as well as evaluating the overall presentation of the
“financial statements”. We believe that the audit evidence we have obtained is sufficient and
appropriate to provide a basis for our opinion.
In our opinion, the “financial statements” present fairly, in all material respects, the financial position and
assets and liabilities of Viadeo SA as of 31 December 2012 and 2013, and of the results of its operations
for each of the years then ended in accordance with International Financial Reporting Standards as
adopted in the European Union.”
The Statutory auditors
Paris La Défense, 25 April 2014
KPMG Audit IS
Jean-Pierre Valensi
Partner
Paris, 25 April 2014
Grant Thornton
Vincent Frambourt
Partner
258
20.4.2 Other information verified by the Statutory auditors
None.
20.5 DATE OF MOST RECENT FINANCIAL INFORMATION
31 December 2013.
20.6 CONSOLIDATED INTERIM FINANCIAL INFORMATION
N/A
20.7 DIVIDEND DISTRIBUTION POLICY
20.7.1 Dividends paid during the last three fiscal years
None.
20.7.2 Dividend distribution policy
There are no plans to introduce a dividend payment policy in the short term in view of the fact that the
Company is in the development stage.
259
20.8 LEGAL AND ARBITRATION PROCEEDINGS
On the date on which this Document de base was registered, to the best of the Company's knowledge
there were no government, judicial or arbitration proceedings or any suspended or pending
proceedings liable to have or to have had a material impact in the last 12 months on the Company’s
financial position, activities or profit or loss and/or those of its subsidiaries.
20.9 MATERIAL CHANGES TO THE FINANCIAL OR OPERATING POSITION
To the best of the Company’s knowledge, there have been no material changes to the Company’s
financial or operating position since 31 December 2013.
260
21 ADDITIONAL INFORMATION
The description below takes into consideration certain changes to the bylaws approved by the combined
shareholders' meeting of 21 May 2014, some of which are subject to the condition precedent of the Company's
initial listing on the Euronext Paris regulated market.
21.1 SHARE CAPITAL
21.1.1 Amount of the share capital
On the date of registration of this document de base, subsequent to the Company's 25-for-1 stock split
(and the related 25-fold multiplication of the number of shares comprising the share capital) approved
by the combined shareholders' meeting on 21 May 2014, the Company's share capital stood at
€157,676.50, divided into 7,883,825 fully paid up shares, each with a par value of €0.02:
•
•
6,612,050 ordinary shares;
1,271,775 Series A preferred shares.
All preferred shares will be automatically converted into ordinary shares at a rate of one ordinary share
for each preferred share, to coincide with the Company's initial listing on the Euronext Paris regulated
market, such that the whole of the share capital will be made up of ordinary shares.
21.1.2 Non-equity securities
None.
21.1.3 Acquisition by the Company of its own shares
On the date of registration of this document de base, the Company held 107,421 of its shares, or 1.36%
of its share capital, via China Biznetwork Corp., in which the Company has a 9.55% capital interest.
Moreover, the combined shareholders' meeting on 21 May 2014 authorised the board of directors to
implement, for a period of eighteen (18) months after the meeting, a share buyback programme in
accordance with articles L. 225-209 et seq. of the French commercial code and pursuant to the General
Regulation of the French Financial Markets Authority (AMF), subject to the condition precedent of
the initial listing of the Company's shares on the regulated market of Euronext in Paris by 31
December 2014 at the latest. The main terms of this authorisation were as follows:

maximum number of shares that may be purchased: 10% of the total number of shares, at any
given time, provided that, when shares are acquired with the aim of increasing the liquidity of
the Company's shares, the number of shares taken into consideration when calculating this
limit corresponds to the number of shares purchased, less the number of shares resold during
the authorisation period and that when shares are acquired with a view to being held and used
at a later date, in payment or exchange, as part of a merger, spin-off or contribution, the
number of shares acquired may not exceed 5% of the total number of shares;

share buyback objectives:

to ensure the liquidity of the Company's shares within the context of a liquidity contract
to be entered into with an investment services provider, in accordance with a code of
ethics recognised by the AMF,
261

to honour obligations relating to stock option plans, free share grants, employee savings
schemes or any other share grants made to the Company's employees or executives or
those of any related companies,

to deliver shares upon the exercise of rights attached to securities giving access to the
Company's share capital,

to purchase shares to be held and subsequently used in payment or exchange within the
context of any acquisitions, or

to cancel all, or part, of the shares bought back under this programme;

maximum purchase price (not including fees and commission): 300% of the price per share to
be used for the initial public offering of the Company's shares;

overall maximum purchase amount: €10 million
21.1.4 Securities giving access to a percentage of the share capital
On the date of registration of this document de base, there were two kinds of securities giving access
to the share capital. Details are given below:
262
21.1.4.1 Founders warrants (BSPCE)
Date of shareholders’ meeting
Date of shareholders’ meeting at
which the terms of the founders
warrants were amended
Date of board meeting/
shareholders' meeting
Number of BSPCE authorised
Number of BSPCE granted
Total number of shares that may
be subscribed(1)
be subscribed by directors (1)
Directors concerned:
Thierry Lunati
Dan Serfaty
Derek Ling
Number of non-director
beneficiaries (originally)
Start date for exercise of BSPCE
BSPCE expiry date
Share subscription price
Conditions of exercise
Number of shares subscribed at
30 April 2014(1)
Total number of BSPCE
cancelled or lapsed (2)
BSPCE outstanding at 30 April
2014
be subscribed at 30 April
2014(1)(5) (6)
“BCE 01”
“BCE 02”
“BCE 03”
“BCE 04”
“BCE 05”
27 August
2007
27 August 2007
6 July 2009
30 June 2010
29 June 2012
29 June
2012
29 June 2012
21 May 2014
-
-
27 August
2007
(sharehold
ers’
meeting)
6 December
2007
28,466
4
February
2008
20
February
2008
9 September
2009
9,490
10 March
2010
5 July
2011
18
October
2011
9,400
14
December
2014
29
December
2011
10
September
2012
9,185
18 June
2013
17
December
2013
15,000
28,466
5,662
1,969
215
8,095
150
7,000
480
760
940
5,000
5,005
4,995
711,650
141,550
49,225
5,375
202,375
3,750
175,000
12,000
19,000
23,500
125,000
125,125
124,875
711,650
-
-
-
12,500
-
-
-
-
-
125,000
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
355,825
-
-
-
-
-
-
-
-
-
62,500
-
-
355,825
-
-
-
-
-
-
-
-
-
62,500
-
-
-
-
-
-
12,500
-
-
-
-
-
-
-
-
-
27
6
2
64
1
66
5
4
3
0
28
43
10
September
2013
10
September
2022
27 August
2007
(4)
(4)
(5)
18 June
2014
31 August
2017
31 December 2017
31 December 2019
31 December 2017
€6.694
€6.694
€8.368
€10.014
€19.066
(3)
(4)
(4)
(5)
(6)
18 June
2023
17
December
2014
17
December
2023
-
18.375
-
375
1,725
-
650
-
-
-
-
-
-
-
2,446
415
200
1,891
150
3,774
190
560
850
-
300
-
2,481
1,554
-
6,135
-
3,200
290
200
90
5,000
4,705
4,995
62,025
38,350
-
153,375
-
80,000
7,250
5,000
2,250
125,000
117,625
124,875
28,466
711,650
263
(1) The figures shown take into account the 25-for-1 stock split approved by the combined shareholders' meeting on 21 May 2014.
(2) BSPCE are cancelled as a result of employee beneficiaries leaving the Company.
(3) BCE 01 are all exercisable on the date of registration of the document de base.
(4) BCE 02 and BCE 03 are all exercisable on the date of registration of this document de base.
(5) With regard to BCE 04, up to one third of the BSPCE can be exercised on each anniversary of the date of signing of their subscription form, provided
that, (i) the Beneficiary is still a Company employee or director or an employee or director of a company controlled by it or by which it is controlled
within the meaning of article L. 233-3 of the French Commercial code on the corresponding anniversary date (hereinafter the "Group") and (ii) that
BSPCE 05 are, in any event, exercised by 31 December 2017.
On the date of registration of this document de base, only 3,586 BCE 04 were exercisable (taking into account the terms of exercise described above)
out of a total of 3,780 BCE 04 outstanding at 30 April 2014 allowing their holders to subscribe to 89,650 shares.
(6) With regard to BCE 05, up to one third of the BSPCE can be exercised on each anniversary of their allocation by the board of directors, provided that,
(i) the Beneficiary is still a Company employee or director or an employee or director of a company controlled by it or by which it is controlled within
the meaning of article L. 233-3 of the French Commercial code on the corresponding anniversary date (hereinafter the "Group") and (ii) that BSPCE
05 are, in any event, exercised within ten years of Allocation.
By way of exception, in the event of (i) the sale by one or more Company shareholders to one or more third parties under common control, of a number
of shares such that said third parties hold more than 50% of the share capital and voting rights of the Company, (ii) the Company being taken over by
another company not controlled by shareholders holding a controlling interest in the Company within the meaning of article L. 233-3 of the French
Commercial code, immediately prior to the completion of said takeover, or (iii) the sale of all, or nearly all, of the Company's assets to a third party
not controlled by the Company or its shareholders within the meaning of article L. 233-3 of the French commercial code (in each case, referred to
hereinafter as a "Change of Control"), one hundred percent (100%) of the BSPCE 05 held by Beneficiaries in post within the Group will become
exercisable with effect from the completion date of said Change of Control, provided that each beneficiary is still an employee or director of the Group
on the date of said Change of Control.
On the date of this document de base, only 1,666 BCE 05 are exercisable (taking into account the terms of exercise described above) out of a total of
14,700 BCE 05 outstanding at 30 April 2014 allowing their holders to subscribe 41,650 shares.
264
21.1.4.2
Bonds convertible into shares
The shareholders' meetings held on 27 January 2014, 21 February 2014 and 21 May 2014 respectively
approved the issue of 50,500, 5K and 50K convertible bonds (OC), the features of which are
summarised below.
Date of shareholders' meeting
Number of OC issued on the date of
registration of the document de base
Total number that may be subscribed by
directors
Directors concerned
Dan Serfaty
Thierry Lunati
Ventech(1)
Bpifrance Participations(1)
Idinvest Partners(1)
Financière WM(2)
A CAPITAL Management(1)
Non-director beneficiaries
OC
OC
OC
27 January 2014
21 February
2014
21 May 2014
50,500
5,000
50,000
3
0
0
750
750
5,000
20,000
20,000
1,000
-
Angyal
TMM Consulting
Global Internet Ventures LLC
Other natural persons
1,500
500
1,000
-
OC issue price
OC annual interest rate
Conditions of conversion
Number of shares subscribed on the
date of registration of this document de
base as a result of the conversion of OC
Total number of lapsed or cancelled OC
on the date of registration of this
document de base
50.000
5,000
-
€100
€100
€100
9%
9%
9%
21 May 2019
(4) (5)
21 February
2019
(4) (5)
0
0
0
0
0
0
(3)
OC maturity date
-
27 January 2019
(4) (5) (6)
(1)
Bonds subscribed for by managed funds.
(2)
William Johnston is the manager and majority shareholder of Financière WM.
(3)
Including a rate of 4% for which the corresponding interests will be capitalised in accordance
with Article 1154 of the French civil code.
265
(4)
Conversion of OC in case of an IPO
Assuming the initial public offering of all, or some, of the Company's shares (including, where
appropriate, in the form of American Depositary Shares or American Depositary Receipts) on
a regulated French, German or English market, on the Alternext market of NYSE Euronext in
Paris, on the Nasdaq National Market or the New York Stock Exchange in the USA, or on any
other market approved by holders of the majority of the OC currently outstanding (an
" IPO "), each OC holder shall be entitled to request the conversion of all its OC (it being
specified that said conversion shall be automatic for OC issued by the shareholders' meeting of
21 May 2014 in the event where the OC issued on 27 January 2014 would be converted in
case of an IPO) into a number "N" of ordinary shares calculated as follows and effective
immediately prior to the IPO, subject to the completion of the IPO:
N = M/X
where:
"M"
is the total amount owing by the Company to the OC Holder in question for its OC
on the date of the IPO (principal, plus Interest Paid, accrued but not yet due,
Capitalised Interest due and Capitalised Interest accrued but not yet due); and
«X»
is the price per share used for the IPO, less a 25% discount if the IPO is completed
in 2014 or 2015, or 30% if the IPO is completed after 1st January 2016;
given that:
(5)
-
where the conversion of OC belonging to any given bondholder entitles the latter to
subscribe to a fractional number of ordinary shares, this number will be rounded
down to the nearest whole number; and
-
the Company will make a cash payment to each OC Holder for the outstanding
amount owing as a result of any fractional lots.
Early redemption of OC in case of a Financing Round
Should the Company decide, unrelated to any IPO, to issue equity securities or securities
giving access to share capital totalling (issue premium included) at least €10 million in which
one or more non-shareholder third parties would invest (hereinafter " Financing Round"), the
OC will be automatically and immediately repayable to the OC Holders wishing to redeem
their bonds (principal, plus Interest Paid, accrued and not yet due, Capitalised Interest due and
Capitalised Interest accrued but not yet due) solely by means of offsetting against the
subscription price of the securities that would be issued to them in the context of the Financing
Round, with, in addition to interest, a premium of 33.33% of the Par Value of the OC if the
Financing Round is completed in 2014 or 2015, or 42.85% if the Financing Round is
completed after 1 January 2016.
The following shall not be considered to be "non-shareholder third parties" (i) any investment
fund or company (including any FCPI or FCPR/FPCI) managed by the same management
company as any one of the investment funds being a shareholder of the Company or by a
management company controlling, controlled by or under common control with the
management company of any of the investment funds being a shareholder of the Company or
(ii) any company controlling, controlled by or under common control with one of the
Company's shareholders (control being defined as control within the meaning of article L.
233-3 of the French Commercial code or the exercise of significant influence within the
meaning of article L. 233-16 of the French Commercial code).
266
Early redemption of OC in the event of sale of the Company
If a third party non-signatory of the Company's shareholders' agreement dated 26 April 2012
(the "Purchaser") acquires over 50% of the Company's share capital and voting rights (the
"Sale"), prior to the Maturity Date, each OC Holder will be entitled to request the redemption
of all its OC (principal, plus Interest Paid, accrued but not yet due, Capitalised Interest due and
Capitalised Interest accrued but not yet due), with, in addition, a premium of 33.33% of the
Par Value if the Sale is completed in 2014 or 2015, or 42.85% if the Sale is completed after
1 January 2016.
Other cases of early redemption of OC
Should one of the following events occur between the Issue date and the Maturity Date, the
holders of the majority of the outstanding OC may request the early repayment, in cash, of all
amounts owing in respect of the OC (principal, plus Interest Paid, accrued but not yet due,
Capitalised Interest due and Capitalised Interest accrued but not yet due and the nonconversion premium):
-
-
payment default under the OC (failure of the Issuer to make payment of any amount
owing to the OC Holders, whether relating to principal, interest, allowances or incidentals,
on the due date, unless the situation is remedied within five (5) working days of a formal
notice made by the OC Holder or Holders for the payment in question to be made);
failure to meet the Company's commitments in respect of OC, not resolved within 30
calendar days of a request being made by the OC holders;
institution of safeguard proceedings (procédure de sauvegarde) or administration
proceedings (procédure de redressement judiciaire) against the Company;
voluntary or compulsory liquidation of the Company;
winding up of the Company's business activities;
resignation of Dan Serfaty or Thierry Lunati from their positions at Viadeo for any reason
other than serious illness; and
sale by Dan Serfaty or Thierry Lunati, in one or more lots, of the majority of the shares of
the Company held by them on the Issue Date or that they may come to hold (shares or
other equity entitlements).
In addition, and in any event, holders of the majority of outstanding OC may request, just as the
Company may unilaterally decide on, in each case by giving 30-day prior notice, the early repayment
in cash of any amounts owing in respect of OC (principal, plus Interest Paid, accrued but not yet due,
Capitalised Interest due, Capitalised Interest accrued but not yet due and the non-conversion premium)
at any time from 27 July 2017.
267
(6)
Conversion of OC into preferred shares at the option of the OC holders from 1July 2015
If there is no IPO, Financing Round or Sale prior to 1 July 2015, the holder or holders of the majority
of the OC may request, on just one occasion, at any time between this date and the Maturity date, to
convert all of the OC into a number "N" of preferred shares of the Company known as "A Shares",
calculated as follows:
N = M/X
where:
"M"
is the total amount owing by the Company to the OC Holders under the OC on the date of
receipt by the Company of the OC conversion request (principal, plus Interest Paid, accrued
but not yet due, Capitalised Interest due and Capitalised Interest accrued but not yet due);
and
"X"
is the price per share used for the Company's last financing round in April 2012, or €476.66
per A Share, prior to the effective date of the stock split approved at the combined
shareholders' meeting held on 21 May 2014.
given that:
-
if the conversion of OC would entitle the relevant OC holder to subscribe to a fractional
number of ordinary shares, this number will be rounded down to the nearest whole
number; and
-
the Company will make a cash payment to the OC Holder for the outstanding amount
owing as a result of any fractional lots.
268
21.1.4.3
Summary of dilutive instruments
On the date of registration of this document de base and after taking into consideration the 25-for-1
stock split approved by the combined shareholders' meeting of 21 May 2014, the total number of
ordinary shares likely to be created by the exercise, in full, of all securities giving access to the
Company's share capital to date stood at (1,427,900+ N) broken down as follows:

57,116 BSPCE issued, the full exercise of which would lead to the creation of 1,427,900 new
shares, and

N new shares which could result from the full conversion of the 105,500 OC issued in
January, February and May 2014 on the day of the initial listing of the Company's shares,
should this take place by 31 December 2014 at the latest. This number N of new shares is
equal to the ratio (principal of the bond issuance plus interest paid, accrued but not yet due,
Capitalised Interest due and Capitalised Interest accrued but not yet due)/(IPO Price*75%).
Not including the potential dilution that could result from OC conversion (which cannot be determined
at this stage since it is dependent on the future IPO Price), the exercise of all other securities giving
access to the Company's share capital on the date of registration of this document de base could result
in a maximum 18.11% dilution based on current capital and voting rights and a 15.33% dilution based
on fully diluted capital and voting rights.
21.1.5 Authorised capital
Issue resolutions adopted by the combined shareholders' meeting of 21 May 2014, ruling on an
extraordinary basis, are summarised below:
Period of
validity/
Expiry
Delegation of authority granted to the board for the purpose of increasing
the capital by issuing ordinary shares or any securities giving access,
26 months
immediately and/or in the future to the share capital of the Company, with
maintenance of the preferential subscription right*
Ceiling
Price
calculation
methods
€140,000(1)
N/A
the capital by issuing ordinary shares or any securities giving access to the
26 months €140,000(1)
share capital, with elimination of the preferential subscription right and
public offering and with the option to create a priority right
the capital by issuing ordinary shares or any securities giving access to the
26 months
share capital, with elimination of the preferential subscription right, by
means of an offer to qualified investors or a limited circle of investors*
Please refer to
(2)
€140,000(1)no
more than 20% of Please refer to
share capital per
(3)
12-month period
Authorisation to the board, in the event of an issue of shares or any
securities giving access to the share capital with elimination of the
no more than 10% Please refer to
shareholders’ preferential subscription right, for the purpose of setting the 26 months
of the share capital
(4)
issue price up to the limit of 10% of the share capital and within the
limitation stipulated by the shareholders’ meeting*
no more than 15% Same price as
the number of shares to be issued in the event of a capital increase, with or
26 months of the initial issue
the initial
without a preferential subscription right, which would be decided based
(1) (5)
issue
on the above delegations of authority
269
Period of
validity/
Expiry
Delegation of authority granted to the board for the purpose of issuing
ordinary shares or securities giving access to the share capital, in the event
26 months
of a public exchange offer including a component involving an exchange
initiated by the Company*
Ceiling
Price
calculation
methods
€140,000(1)
€140,000, no more
than 10% of the
Delegation of power granted to the board for the purpose of increasing the
existing share
capital in compensation for contributions in kind involving equity
26 months capital on the date
securities or securities giving access to the share capital of third-party
of the transaction
companies outside of a public exchange offer*
under
consideration(1)
the capital by incorporation of premium, reserves, profits or other funds,
by issue and allocation of free shares or by raising the nominal value of
the existing shares or by combined use of both these procedures*
26 months
€400,000
Authorisation granted to the Management Board for the purpose of
granting stock options
38 months
1,000,000
shares (6)
Authorisation granted to the board to make allocations of existing or new
free shares
38 months
1,000,000 shares
and no more than
10% of the share
capital (6)
Delegation of authority to be granted to the board for the purpose of
issuing free founders warrants [BSPCE] to the Company's employees and
executives
18 months
1,000,000 shares Please refer to
(6)
(8)
Delegation of authority to be granted to the board for the purpose of
issuing and allocating warrants to (i) observers and members of the
Company’s board in office on the allocation date of the warrants, who are
not employees or executives of the Company or any of its subsidiaries or
18 months
(ii) persons connected by a services or consultant contract to the Company
or any of its subsidiaries or (iii) members of any committee that might be
set up by the board, who are not employees or executives of the Company
or any of its subsidiaries
1,000,000 shares Please refer to
(6)
(9)
Authorisation granted to the board for the purpose of the purchase by the
Company of its own shares*
18 months
10% of the share
capital
18 months
10% of the
10% of the share
share capital
capital per 24per 24-month
month period
period
Authorisation granted to the board for the purpose of decreasing the share
capital by cancelling shares pursuant to the authorisation to buy back the
Company’s own shares*
* Subject to the non-retroactive condition precedent of completion of the IPO.
270
Please refer to
(7)
10% of the
share capital
(1) These amounts are not cumulative. The maximum overall ceiling authorised by the shareholders'
meeting for share capital increases at par value is set at €140K.
(2) The issue price will be calculated as follows:

as regards the capital increase to be completed upon the admission to trading and initial listing of
the Company's shares on the regulated market of Euronext in Paris, the subscription price of one
new share will be calculated by matching the shares offered with subscription orders placed by
investors using the “bookbuilding technique”.

subsequent to the admission to trading and the first listing of the Company's shares on the
regulated market of Euronext in Paris, the issue price will be at least equal to the weighted average
share price on the three trading days prior to the setting of said issue price less, where appropriate,
the legally authorised discount (currently 5%) corrected in the case of any difference in the
possession date (date de jouissance), provided that the issue price of the securities giving access to
share capital will be such that the amount immediately received by the Company plus, where
appropriate, the amount likely to be received by it at a later date, for each share issued as a result
of the issue of such securities, will be at least equal to the issue price defined above,
(3) the issue price will be at least equal to the weighted average share price on the three trading days prior
to the setting of said issue price less, where appropriate, the legally authorised discount (currently 5%)
corrected in the case of any difference in the possession date (date de jouissance), provided that the
issue price of securities giving access to share capital will be such that the amount immediately received
by the Company plus, where appropriate, the amount likely to be received by it at a later date, for each
share issued as a result of the issue of such securities, will be at least equal to the issue price defined
above,
(4) Up to the limit of 10% of the share capital of the Company (as of the date of the transaction) per 12month period, the board of directors may deviate from the price-setting conditions provided for by the
aforementioned resolutions and set the issue price of the ordinary shares and/or the securities giving
immediate or future access to the share capital, as follows:

the issue price of the ordinary shares will be at least equal to the weighted average share price on
the five trading sessions prior to the setting of said issue price, less a maximum 15% discount, if
applicable, provided that this may, under no circumstances, be less than the par value of one share
of the Company on the issue date of the shares in question,

the issue price of securities giving access to capital will be such that the amount immediately
received by the Company plus, if applicable, the amount likely to be received by it at a later date,
for each share issued as a result of the issue of such securities, will be at least equal to the issue
price defined in the paragraph above,
(5) 15% or any other percentage that may have been set by applicable regulations;
(6) These amounts are not cumulative. The maximum overall ceiling authorised by the shareholders'
meeting for issues of securities giving access to share capital is set at 1,000,000 shares
(7) The purchase or subscription price per share will be set by the board of directors on the date on which
the option is granted, as follows:
(i)
until the shares are admitted to trading on a regulated market in the European Union or on a stock
exchange in Switzerland, or on the Nasdaq National Market or the New York Stock Exchange in
the United States, the subscription or purchase price will be set in accordance with article L. 225177 of the French Commercial code and shall be at least equal to the price per share used for the
Company's last capital transaction, unless the board has taken a duly substantiated decision to the
contrary;
(ii) should the Company's shares be admitted to trading on a regulated market in the European Union
or on a stock exchange in Switzerland, or on the Nasdaq National Market or the New York Stock
Exchange in the United States, the board may set the purchase or subscription price per share by
reference to the sale price of one share when said regulated market closed on the day before the
board's decision to grant the Options. The purchase or subscription price may not, however, under
any circumstances be less than ninety five percent (95%) of the average share price on the twenty
trading sessions preceding the date on which the board took the decision to grant the Options,
271
provided that when an option enables its beneficiary to purchase shares previously purchased by the
Company, its exercise price, without prejudice to the above clauses and in accordance with applicable
legal provisions, may also not be less than 80% of the average price paid by the Company for all the
shares previously purchased by it,
(8) The subscription price of a share upon exercise of a founders warrant (BSPCE) will be set by the board
on their allocation date, as follows:
(i) until the Company’s shares are admitted to any stock market or exchange, each founders warrant
(BSPCE) will allow for the subscription of one ordinary share with a par value of €0.02 at an
exercise price set by the board on the allocation date of the BSPCE, as follows:
o
if a capital increase took place during the period of validity of this authorisation, through the
issue of ordinary shares, the exercise price will, for a six-month period from the date of said
capital increase, be at least equal to the subscription price of one ordinary Company share
under said capital increase;
o
if no ordinary shares are issued during the six-month period preceding the allocation of the
BSPCE but a capital increase takes place less than six months prior to the allocation of the
BSPCE through the issue of preferred shares or securities giving future access to a percentage
of share capital, the board will calculate and set the exercise price by taking into
consideration the rights conferred by equity securities or securities thus issued compared with
the rights conferred by ordinary shares;
o
if no ordinary shares, preferred shares or securities giving future access to a percentage of
share capital are issued within the six months prior to the allocation of the BSPCE, the
exercise price will be set, mutatis mutandis, in accordance with article L. 225-177 of the
French Commercial code, taking into account the price per share used for the Company's last
capital transaction, unless the board has taken a duly substantiated decision to the contrary;
it being specified that, when calculating the exercise price, the board will not take into account the
capital increases resulting from the exercise of warrants, stock options or free share allocations,
(ii)
when the Company's shares are admitted to trading on a stock market or exchange, the exercise
price, to be set by the board when the BSPCE are granted, shall be at least equal to the weighted
average share price of the last 20 trading sessions prior to the date on which said BSPCE are
granted by the board.
272
(9) The exercise price of warrants (BSA) will be set by the board on their allocation date, as follows:
(i) until the shares are admitted to trading on any stock market or exchange, each BSA will allow for
the subscription of one ordinary share with a par value of €0.02 at an exercise price set by the board
on the allocation date of the BSA, as follows:
o
if a capital increase took place during the period of validity of this authorisation, through the
issue of ordinary shares, the Exercise Price will, for a six-month period from the date of said
capital increase, be at least equal to the subscription price of one ordinary Company share
under said capital increase;
o
if no ordinary shares are issued during the six-month period preceding the allocation of the
BSA but a capital increase takes place less than six months prior to the allocation of the BSA
through the issue of preferred shares or securities giving future access to a percentage of
share capital, the board will calculate and set the exercise price by taking into consideration
the rights conferred by equity securities or securities thus issued compared with the rights
conferred by ordinary shares;
o
if no ordinary shares, preferred shares or securities giving future access to a percentage of
share capital are issued within the six months prior to the allocation of the BSA, the exercise
price will be set, mutatis mutandis, in accordance with article L. 225-177 of the French
Commercial code, taking into account the price per share used for the Company's last capital
transaction, unless the board has taken a duly substantiated decision to the contrary;
it being specified that, when calculating the exercise price, the board of directors will not take into
account the capital increases resulting from the exercise of warrants, stock options or free share
allocations,
(ii)
as long as the Company's shares will be admitted to trading on a stock market or exchange, the
exercise price, to be set by the board when the BSA are granted, shall be at least equal to the
weighted average share price on the last 20 trading sessions prior to the date on which said BSA
were granted by the board.
273
21.1.6 Information on the capital of any member of the Group under option or
agreed conditionally or unconditionally to be put under option
To the Company’s knowledge, on the date of registration of this document de base there are no
existing put or call options or other commitments made to the Company’s shareholders or granted by
the latter in relation to the shares of the Company, provided however that :
(i) the agreement signed by the Company's main shareholders on 26 April 2012 will be
automatically cancelled on the date of the initial listing of shares of the Company on the
regulated market of Euronext in Paris, and
(ii) the following shareholders are expected, by the time of the Company’s IPO, to exercise, in the
amounts shown opposite their name, the call options granted to them, on a case-by-case basis,
on 16 November 2006 or 8 January 2007 (as amended on 30 November 2013) by shareholders
of the Company at a price of €4.492 per share, in some cases with effect deferred until the
Company's IPO so as to enable such call options to be financed by the sale of shares through
the Company's IPO:
- Karen Serfaty: 164,875 shares,
- Thierry Lunati: 164,875 shares,
- AV3: 106,125 shares,
- Guillaume Olivier Dore: 10,300 shares,
- Jérôme Masurel: 7,750 shares,
- Damien Chalret du Rieu: 5,125 shares
- Avi Corcos: 5,125 shares,
- Sacha Borantin: 2,550 shares,
Said call options were mainly granted by the Company's financial shareholders:
- AV3: 162,400 shares,
- Ventech: 86,975 shares,
- Idinvest Partners: 86,925 shares,
- AFV2 Investissement: 67,325 shares,
- CREADEV: 32,500 shares,
- PGA Invest: 20,050 shares,
- Marc Reeb: 7,025 shares.
- Christophe Chausson: 3,525 shares,
the share numbers shown above take into account the 25-for-1 stock split approved by the
combined shareholders' meeting on 21 May 2014.
21.1.7 Share capital history
274
21.1.7.1 Changes in share capital since the formation of the Company
Date
Nature of the transactions
Number of
shares issued
or cancelled
Capital
Creation - contribution in kind
50,000
€5,000.00
Capital increase in cash
56,842
€5,684.20
7 June 2006
0
€26,710.50
(by raising the par value)
22 June 2006
44,969
€15,739.15
27 August 2007
29,878
€10,457.30
15 May 2009
9,635
€3,372.25
10 June 2009
6,470
€2,264.50
Conversion of 2,440 convertible bonds held by
14 July 2009
44,993
€15,747.55
CBC into shares
Capital increase by means of a contribution in kind
17 July 2009
4,041
€1,414.35
(acquisition of Apna)
9 September 2009
2,022
€707.70
16 December 2009
1,799
€629.65
(acquisition of Unyk)
26 May 2010
Exercise of "SB" BSA (acquisition of Unyk)
1,471
€514.85
30 November 2010
Exercise of "Unyk" BSA (acquisition of Unyk)
1,635
€572.25
24 June 2011
Exercise of "Apna" BSA (acquisition of Apna)
2,022
€707.70
Redemption of 6,212 "Unyk" convertible bonds
16 December 2011
6,212
€2,174.20
into shares
29 December 2011
839
€293.65
(acquisition of Soocial)
25 April 2012
Issue of Series A preferred shares
50,871
€17,804.85
14 June 2012
Exercise of "BCE 02"
600
€210.00
16 July 2012
30
€10.50
10 September 2012
Exercise of "SF" BSA (acquisition of Soocial)
404
€141.40
28 February 2013
45
€15.75
28 February 2013
24
€8.40
4 October 2013
15
€5.25
4 October 2013
15
€5.25
4 October 2013
26
€9.10
24 October 2013
60
€21.00
24 October 2013
30
€10.50
25 October 2013
Exercise of "SF" BSA (acquisition of Soocial)
405
€141.75
Raising of the par value of the share (incorporation
21 May 2014
0
€47,302.95
of part of the issue premium)
21 May 2014
25-for-1 stock split
7,568,472
* Price adjusted for the 25-for-1 stock split decided by the combined shareholders' meeting of 21 May 2014
15 December 2005
13 February 2006
Additional paid-in
capital
Total nominal
share capital
Total number of
shares outstanding
Par value
Adjusted issue
price (or exercise
price) per share*
- €
- €
€5,000.00
€10,684.20
50,000
106,842
€0.10
€0.10
€0.01
€0.01
- €
€37,394.70
106,842
€0.35
€0.01
€5,034,279.55
€4,989,626.00
€2,012,173.40
€1,351,194.80
€53,133.85
€63,591.15
€66,963.40
€69,227.90
151,811
181,689
191,324
197,794
€0.35
€0.35
€0.35
€0.35
€4.49
€6.69
€8.37
€8.37
€2,996,363.86
€84,975.45
242,787
€0.35
€2.68
€674,847.00
€86,389.80
246,828
€0.35
€6.69
€337,674.00
€87,097.50
248,850
€0.35
€6.69
€449,120.35
€87,727.15
250,649
€0.35
€10.00
€367,235.15
€408,177.75
(1)
€88,242.00
€88,814.25
€89,521.95
252,120
253,755
255,777
€0.35
€0.35
€0.35
€10.00
€10.00
€0.01
€1,550,825.80
€91,696.15
261,989
€0.35
€10.00
€805,951.79
€91,989.80
262,828
€0.35
€38.44
€24,230,366.01
€100,200.00
€5,010.00
(2)
€7,515.00 €
€5,012.16
€2,505.,00 €
€3,132.60
€12,384.06
€10,020.00
€6,265.20
(2)
€109,794.65
€110,004.65
€110,015.15
€110,156.55
€110,172.30
€110,180.70
€110,185.95
€110,191.20
€110,200.30
€110,221.30
€110,231.80
€110,373.55
313,699
314,299
314,329
314,733
314,778
314,802
314,817
314,832
314,858
314,918
314,948
315,353
€0.35
€0.35
€0.35
€0.35
€0.35
€0.35
€0.35
€0.35
€0.35
€0.35
€0.35
€0.35
€19.07
€6.69
€6.69
€0.01
€6.69
€8.37
€6.69
€8.37
€.10.01
€6.69
€8.37
€0.01
(€47,302.95)
€157,676.50
315,353
€0.50
N/A
€157,676.50
7,883,825
€0.02
N/A
(1) BSA granted to founders of ApnaCircle given the performance achieved by ApnaCircle management since the acquisition. (2) BSA granted in the context of a contribution in kind (Acquisition
of 100% of the share capital of "Soocial"), the issue price of the warrants having then been set at €960.61 per warrant and their exercise price at par, i.e., at €0.35 per share.
275
21.1.7.2
Changes in share capital breakdown since 31 December 2011
At 31 December
2011
Number
of shares
Shareholders
% of
capital
and
voting
rights
At 31 December
2012
Number
of shares
% of
capital
and
voting
rights
At 31 December
2013
Number
of
shares
% of
capital
and
voting
rights
At 30 April 2014*
Number of
shares
% of
capital
and
voting
rights
Founders and related parties
Dan Serfaty (chairman and chief
executive officer)
Karen Serfaty(1)
Dan Serfaty family sub-group(1)
Thierry Lunati (Deputy CEO(2))
1
7,762
7,763
7,098
0.00%
2.95%
2.95%
2.70%
1
7,762
7,763
7,098
0.00%
2.47%
2.47%
2.26%
1
7,762
7,763
7,098
0.00%
2.46%
2.46%
2.25%
25
358,925
358,950
342,325
0.00%
4.55%
4.55%
4.34%
Total founders and related parties
14,861
5.65%
14,861
4.72%
21.2
14,861
4.71%
701,275
8.90%
Financial investors
AV3 (ex AGREGATOR)
Idinvest Partners (3)
Ventech (4)
AFV2 Investissement
BPI France Investissement (ex FSI)
CREADEV
PGA Invest
Allianz Vie
Other financial investors (5)
Total financial investors
21.3
54,905
40,526
39,167
17,064
0
10,148
9,862
0
6,481
20.89%
15.42%
14.90%
6.49%
0.00%
3.86%
3.75%
0.00%
2.47%
54,905
47,869
42,314
17,064
20,980
10,148
9,862
4,196
21,686
17.44%
15.21%
13.44%
5.42%
6.67%
3.22%
3.13%
1.33%
6.89%
54,905
47,869
42,314
17,064
20,980
10,148
9,862
4,196
21,686
17.41%
15.18%
13.42%
5.41%
6.65%
3.22%
3.13%
1.33%
6.88%
1,316,350
1,109,800
970,875
359,275
524,500
221,200
226,500
104,900
538,625
16.70%
14.08%
12.31%
4.56%
6.65%
2.81%
2.87%
1.33%
6.83%
178,153
67.78%
229,024
72.77%
21.4
229,024
72.62%
5,372,025
68.14%
Other investors (6)
21.5
CBC (China Biznetwork Corp)(7)
Unyk Holding Inc.
ApnaCircle shareholders
Soocial shareholders
44,993
11,117
8,085
839
17.12%
4.23%
3.08%
0.32%
44,993
11,117
8,085
1,243
14.30%
3.53%
2.57%
0.39%
44,993
11,117
8,085
1,648
14.27%
3.53%
2.56%
0.52%
1,124,825
277,925
202,125
41,200
14.27%
3.53%
2.56%
0.52%
Total other financial investors
65,034
24.74%
65,438
20.79%
21.6
65,843
20.88%
1,646,075
20.88%
4,780
1.82%
5,410
1.72%
5,625
1.78%
164,450
2.09%
262,828
100.00%
314,733
100.00%
315,353
100.00%
7,883,825
100.00%
Individuals(8)
Total
* The number of shares at 30 April 2014 takes into consideration:
- the 25-for-1 stock split decided by the combined shareholders' meeting of 21 May 2014, as well as;
- the exercise, in May 2014, of the call option granted by some of the Company's shareholders as
described in greater detail in section 21.1.10 of this document de base.
(1) In addition to this direct interest, NOUCHKA (of which 92.40% of the share capital is controlled by
Karen Serfaty) holds a 12.45% interest in AV3, which itself holds 16.70% of the share capital of the
Company.
(2) In addition to this direct interest, MARLU (of which 45% of the share capital is controlled by Thierry
Lunati) holds a 23.38% interest in AV3, which holds 16.70% of the share capital of the Company.
(3) Shareholding held via seven FCPI (fonds commun de placement dans l’innovation) and one
management company for 2011 and via 18 FCPI (fonds commun de placement dans l’innovation) and
one management company for 2012, 2013 and 2014.
276
(4) Shareholding held via one FCPI (fonds commun de placement dans l’innovation) and one FCPR (fonds
commun de placement à risques).
(5) No individual investor holds more than 2.03% of the share capital of the Company. Additionally,
Jefferies International Limited holds 1.46% of the share capital and voting rights of the Company since
April 2012.
(6) Companies, funds or individuals who have become Company’s shareholders as a result of the various
acquisitions made by the Group (primarily conversions of bond issue and shares of Viadeo issued as
consideration for transactions by means of a contribution-in--kind).
(7) Viadeo holds 9.55% of the shares of CBC as a result of the subscription in 2007 to two USD 5.1 million
share capital increases, prior to the Group's acquisition of the Tianji platform. Viadeo does not have
any management role within CBC and, given CBC's shareholding, does not have any significant
influence likely to have an effect on any decisions which may be made by CBC’s shareholders.
(8) Mainly former employees of the Company who have exercised their founders warrants (no individual
employee holding more than 1.43% of the Company's share capital)
The main changes resulted from the following:
In 2011:
- exercise of warrants "APNA" by historical shareholders of ApnaCircle granting them 2,022
shares of the Company;
- redemption of "Unyk" convertible bonds with 6,212 Company shares granted to historical
shareholders of Unyk;
- issue of 839 shares of the Company to shareholders of Soocial as payment for the acquisition
of said company.
In 2012:
- 4th financing round worth €24.2 million and marking, in particular, the acquisition of a capital
interest by Bpifrance Participations alongside other international investors, Ventech and
Idinvest Partners having also taken part in the financing round. 50,871 shares were issued on
that occasion;
- exercise of warrants "SF" by historical shareholders of Soocial granting them 404 Company
shares;
- exercise of BSPCE by employees.
In 2013:
- exercise of warrants "SF" by historical Soocial’s shareholders granting them 405 shares of
the Company;
- exercise of BSPCE by employees.
In 2014:
- sales between shareholders within the context of the call options described in section 21.1.6 of
this document de base.
- As part of a funding operation decided at the end of 2013, the Company undertook three bond
issues worth €10.5 million.
21.1.7.3 Breakdown of capital and voting rights at 15 April 2014
Please refer to the table appearing in section 18.1 of this document de base.
277
21.2 MEMORANDUM AND BYLAWS
The description given below takes into consideration certain changes to the bylaws approved by the combined
shareholders' meeting of 21 May 2014, some of which are subject to the condition precedent of the Company's
initial listing on the regulated market of Euronext in Paris.
21.2.1 Corporate purpose (article 3 of the bylaws)
The purpose of the Company, in France and abroad, is the development of an online social networking
platform as well as the provision of any likely related service and, in general, any financial,
commercial, industrial, real or other property transactions that may be directly or indirectly related to
the aforementioned purpose or to any similar or associated purpose, likely to assist its expansion or
development.
21.2.2 Bylaws or other provisions relating to members of administrative and
management bodies.
21.2.2.1 Board of directors
A.Composition of the board of directors (article 11 of the bylaws)
The Company is run by a board made up of natural or legal entities, numbers being set by the ordinary
shareholders' meeting in accordance with legal requirements.
At their time of appointment, all legal entities shall designate a natural entity as their permanent
representative on the board of directors. The term of office for the permanent representative is the
same as for the legal entity director being represented. When a legal entity dismisses its permanent
representative, it is also responsible for finding a replacement. The same apples in the event of the
death or resignation of the permanent representative.
Directors have a six-year term of office. The director's term of office comes to an end at the close of
the general shareholders' meeting to approve the financial statements for the year just ended and held
in the year in which said directorship is due to expire.
Directors can always be re-elected. They can be dismissed at any time by decision of the general
shareholders' meeting.
In the event of a vacancy becoming available as a result of death or resignation from one or more seats
on the board, the board of directors may make temporary appointments in the interim period between
two general shareholders' meetings.
Any appointments made by the board, by virtue of the above, are subject to ratification by the next
ordinary general shareholders' meeting.
Failing ratification, resolutions adopted and acts performed by the board at an earlier date nonetheless
remain valid.
If the number of directors falls below the legal minimum, the remaining directors shall immediately
convene an ordinary general shareholders' meeting with a view to making up the board's numbers.
Company employees may be appointed as directors. Their employment contracts must, however,
correspond to actual jobs. In such case, the benefits of the employment contract will not be lost.
278
No more than one third of the directors currently in post may be bound to the Company by an
employment contract.
No more than one third of the directors currently in post may be over 70 years of age. If this limit is
exceeded during the course of a term of office, the oldest director is automatically deemed to have
resigned at the close of the next general shareholders' meeting.
B.Board meetings (article 12 of the bylaws)
The board of directors meets as often as the Company interest requires.
Directors are invited to attend board meetings by the chairman of the board. Meetings may be
convened by any means, whether verbally or in writing.
The chief executive officer, the deputy chief executive office or two members of the board of directors
may also ask the chairman to convene a board meeting on a specific agenda.
Moreover, if the board has not met for over two months, one third or more of directors may ask the
chairman to convene a board meeting on a specific agenda. The chairman may not refuse this request.
If a works committee has been set up, the representatives of this committee, appointed in accordance
with the provisions of the French Labour code, shall be invited to attend all board meetings.
Board meetings take place at the Company's registered office or at any other venue in France or
abroad.
For the board's decisions to be valid, at least half of its members shall be in attendance.
Board of directors' decisions will be taken by majority vote. In the event of a tied vote, the chairman
has the casting vote.
Any rules of procedure adopted by the board of directors may, in particular, state that directors taking
part in board meetings by means of video or teleconferencing will be deemed to be in attendance when
calculating the quorum and majority, in accordance with current regulations. This provision does not
apply to the adoption of the decisions referred to in articles L. 232-1 and L. 233-16 of the French
commercial code.
Directors receive the information needed to perform their duties and fulfil their mandates and may ask
to be supplied with any further documents which they deem appropriate.
Directors may authorise other directors to represent them at board meetings by letter, telegram, telex,
fax, email or any other means of telecommunication, but each director may only hold one proxy per
meeting.
Copies or extracts of decisions taken by the board of directors are duly authenticated by the chairman
of the board of directors, the chief executive officer, directors temporarily acting as chairman or any
proxy duly authorised to this end.
C.Powers of the board of directors (article 13 of the bylaws)
The board of directors determines the Company's business strategy and oversees its implementation.
Without prejudice to the powers expressly vested in shareholders' meetings and within the bounds of
the corporate purpose, the board deals with any issues involving the smooth operation of the Company
and takes decisions on any related matters.
279
In its relations with third parties, the Company is also bound by acts of the board of directors not
falling within the remit of the corporate purpose, unless it can prove that the third party knew that the
act went beyond said purpose or that, under the circumstances, it could not fail to have been aware of
this fact. Publication of the bylaws does not, of itself, constitute sufficient proof thereof.
The board of directors carries out any checks and controls that it deems appropriate.
Furthermore, the board of directors exercises special powers vested in it by the law.
D.Advisory board (article 15 of the bylaws)
The ordinary general shareholders' meeting may, at the suggestion of the board of directors, appoint
observers. The board of directors may also appoint observers directly, subject to ratification by the
next general shareholders' meeting.
The observers form a board. They are chosen freely on the basis of their skills.
They are appointed for a six-year term, ending at the close of the Ordinary shareholders' meeting
called to approve the financial statements for the year just ended.
The advisory board studies the issues submitted for review by the board of directors or its chairman.
Observers attend board meetings and take part in decision-making solely on a consultative basis. Their
absence is never cause for the validity of such decisions to be called into question.
They are invited to attend meetings under the same terms as directors.
The board of directors may compensate observers using the attendance fees granted to the board
members by the general shareholders' meeting.
21.2.2.2 General management (article 14 of the bylaws)
Responsibility for the Company's general management is undertaken either by the chairman of the
board of directors or by another natural person appointed by the board of directors and bearing the title
of chief executive officer.
The chief executive officer is vested with the broadest powers to act on behalf of the Company under
any circumstance. The chief executive officer's powers are exercised within the bounds of the
corporate purpose and without prejudice to those powers expressly vested by law in shareholders'
meetings and in the board of directors.
The chief executive officer represents the Company in its relations with third parties. The Company is
also bound by acts of the chief executive officer not falling within the remit of the corporate purpose,
unless it can prove that the third party knew that the act went beyond said purpose or that, under the
circumstances, it could not fail to have been aware of this fact. Publication of the bylaws does not, of
itself, constitute sufficient proof thereof.
The chief executive officer may not be more than 70 years of age. The chief executive officer will be
deemed to have resigned should this age limit be reached. The chief executive officer's mandate
would, however, be extended to the next board meeting at which the new chief executive officer
would be appointed.
280
Should the chief executive officer also be a director, the term of office as chief executive officer may
not exceed that as director.
The board of directors may dismiss the chief executive officer at any time. Should the dismissal be
decided without just cause, it may give rise to the payment of compensation, unless the chief executive
officer takes over the duties of chairman of the board of directors.
The board of directors chooses, by simple majority vote of those directors present or represented,
between the two operating procedures listed below.
Shareholders and third parties are informed of this choice in accordance with legal and regulatory
requirements.
The choice of the board of directors thus made, remains in force until a decision is taken to the
contrary by the board or, at the board's discretion, for the term of office of the chief executive officer.
When the general management of the Company is undertaken by the chairman of the board of
directors, the provisions applicable to the chief executive officer shall apply.
In accordance with article 706-43 of the French Code of criminal procedure, the chief executive
officer may validly authorise any selected person to represent the Company within the context of any
criminal prosecutions that may be instituted against it.
On the chief executive officer's proposal, the board of directors may authorise one or more natural
persons to assist the chief executive officer as deputy chief executive officer.
In agreement with the chief executive officer, the board of directors determines the scope and duration
of the powers vested in deputy chief executive officers. The board of directors sets their remuneration.
Should the deputy chief executive officer also be a director, the term of office as deputy chief
executive officer may not exceed that as director.
In respect of third parties, deputy chief executive officers have the same powers as the chief executive
officer and, in particular, deputy chief executive officers have the power to go to law.
There may be no more than five deputy chief executive officers.
The deputy chief executive officer or officers may be dismissed at any time by the board of directors,
on the proposal of the chief executive officer. Should the dismissal be decided without just cause, it
may result in the payment of compensation.
281
Deputy chief executive officers may not be more than 70 years of age.Shall a chief executive officer
reach the age limit, he or she will be assumed as resigning from his or her position. The deputy chief
executive officer's mandate would, however, be extended to the next board meeting at which the new
deputy chief executive officer would be appointed.
Should the chief executive officer cease to perform, or be prevented from performing, his or her
duties, unless decided otherwise by the board of directors, the deputy chief executive officer or
officers will remain in office and will retain their powers until the new chief executive officer is
appointed.
21.2.3 Rights, privileges and restrictions attached to Company’s shares
23.2.3.1 Forms of security
Fully paid up shares take the form of registered or bearer shares, as selected by individual
shareholders, subject to the application of legal requirements as to the form of share held by certain
legal or natural entities. Non-fully paid up shares shall take the form of registered shares.
Shares are recorded in a share account in accordance with the procedures laid down by current legal
and regulatory requirements.
Ownership of shares delivered in registered form results from listing in a registered share account.
21.2.3.2 Voting rights
Unless otherwise provided by law, each shareholder has the same number of voting rights and the
same number of votes at shareholders' meetings as the number of fully paid up shares held. At the
same par value, each capital or dividend share gives entitlement to one vote. Any mechanism
automatically conferring a double voting right on shares which can be proven to have been registered
for at least two years in the name of the same shareholder is expressly excluded by the Company's
bylaws.
21.2.3.3 Rights to dividends and profits (articles 9, 21 and 22 of the bylaws)
Each share carries the right to a percentage of the Company's assets, profits and payment in dissolution
in proportion to the number and par value of shares outstanding.
Any time that it is necessary to hold a number of shares, whether or not these are preferred shares, or
securities in order to exercise any right whatsoever, holders of shares or securities shall be personally
responsible for grouping together the necessary number of shares or securities.
No less than five per cent (5%) of the profits for the fiscal year, less any prior losses, shall be allocated
to a reserve fund known as the "legal reserve". Said deduction ceases to be mandatory when the legal
reserve amounts to one tenth of the share capital.
Distributable profit comprises the profit for the fiscal year, less prior losses and the deduction provided
for in the paragraph above, plus any retained earnings.
Should the annual financial statements, as approved by the general shareholders' meeting, show the
existence of a distributable profit, the general shareholders' meeting decides whether to allocate said
profit to one or more reserve accounts, the appropriation or use of which are under its control, or to
carry the profit forward or distribute it in the form of dividends.
282
After having ascertained the existence of the reserves at its disposal, the general shareholders' meeting
may decide to distribute sums withdrawn from such reserves. In this event, the decision expressly
indicates the reserves from which such withdrawals are made. Dividends will preferably be paid out of
the profits for the fiscal year.
Dividend payment procedures are set by the general shareholders' meeting or, failing this, by the board
of directors.
Dividend payments shall, however, be made within nine months of the fiscal year-end.
The general shareholders' meeting to approve the financial statements for the year may grant each
shareholder the option for all, or part, of the dividend to be paid in cash or shares.
Likewise, the ordinary general shareholders' meeting, ruling in accordance with the requirements of
article L. 232-12 of the French commercial code may, in the event of an interim dividend, approved by
the board of directors, being paid to each shareholder, authorise the board of directors to give the
beneficiary the option to have all, or part, of said interim dividend paid in cash or in shares.
The offer of payment in shares, the price and terms under which shares are issued as well as requests
for payment in shares and the terms of any capital increase will be governed by legal and regulatory
requirements.
21.2.3.4 Time limit for dividends
Dividends not claimed within five years of the dividend payment date will be forfeited to the French
state (Article L. 1126-1 of the French General Code on public property).
21.2.3.5 Preferential subscription rights
The Company's shares all carry a preferential right to subscribe for capital increases.
21.2.3.6 Restrictions on voting rights
The bylaws do not contain any restrictions on voting rights attached to shares.
283
21.2.3.7 Identifiable bearer securities (article 8 of the bylaws)
Shareholders can choose between registered or bearer shares. Registered shares are recorded in a share
account in accordance with the terms and conditions laid down by current legal and regulatory
requirements.
In addition, the Company may, at any time and at its own expense, in accordance with current legal
and regulatory requirements, ask any authorised body for the name or, in the case of a legal entity, the
company name, nationality and address of holders of securities vesting immediate or future voting
rights in its shareholders' meetings, as well as the number of securities held by each individual entity
and, where appropriate, the constraints placed on such securities.
21.2.3.8 Buyback of treasury shares
Please refer to section 21.1.3.
21.2.4 Procedures for modifying shareholder rights
Shareholders’ rights, as shown in the Company's bylaws, can only be modified by an extraordinary
general shareholders' meeting.
21.2.5 General shareholders' meetings (article 19 of the bylaws)
A.Holding of meetings
General shareholders' meetings are convened in accordance with legal requirements.
Should the Company wish to convene the meeting by means of electronic telecommunication instead
of by post, it shall first obtain the consent of the shareholders in question who will supply their email
addresses.
Meetings take place at the Company's registered office or at any other venue specified in the notice of
meeting.
The right to participate in shareholders' meetings is governed by current legal and regulatory
requirements and is, in particular, subject to securities being listed in a share account in the name of
the shareholder or the intermediary registered on its behalf, by 00:00, Paris time, on the third working
day prior to the meeting either in registered share accounts held by the Company or in bearer share
accounts held by authorised intermediaries.
If shareholders are unable to attend meetings in person, they can choose either to give a proxy to
another shareholder, to their spouse or partner under a civil partnership or to any other person of their
choice, or to vote by post or to send the Company a proxy form without specifying the name of the
proxy, in accordance with legal and regulatory requirements.
The board of directors may organise, in accordance with current legal and regulatory requirements,
shareholders' attendance and voting at meetings via videoconference or by any means of
telecommunication permitting their identification. Should the board decide to take this option for any
given meeting, it states its decision in the notice of meeting. Shareholders' taking part in meetings via
videoconference or via any other means of telecommunication listed above, as decided by the board of
directors, are deemed to be present for the calculation of quorum and majority.
284
Meetings are chaired by the chairman of the board of directors, or in his or her absence, by the chief
executive officer, by a deputy chief executive officer provided that he or she is also a director, or by a
director specifically authorised to this effect by the board. Failing this, the shareholders' meeting elects
its own chair.
Scrutineer duties are performed by the two members with the largest number of votes who are in
attendance at the meeting and who agree to perform such duties. The office appoints a secretary who
may, or may not, be a shareholder.
An attendance sheet is compiled in accordance with legal requirements.
Ordinary general shareholders' meetings held on first calling can only take valid decisions if the
shareholders present or represented hold at least one fifth of shares with voting rights. Ordinary
general shareholders' meetings held on second calling can take valid decisions regardless of the
number of shareholders present or represented.
Ordinary general shareholders' meetings take decisions by majority vote of shareholders present or
represented.
Extraordinary general shareholders' meetings held on first calling can only take valid decisions if the
shareholders present or represented hold at least one quarter of shares with voting rights.
Extraordinary general shareholders' meetings held on second calling can only take valid decisions if
the shareholders present or represented hold at least one fifth of shares with voting rights.
Extraordinary general shareholders' meetings take decisions by majority vote of two thirds of
shareholders present or represented.
Copies or extracts of the minutes of shareholders' meetings are duly authenticated by the chairman of
the board of directors, by any director acting as chief executive officer or by the meeting secretary.
B.Powers of shareholders' meetings
Ordinary and extraordinary general shareholders' meetings exercise their respective powers in
accordance with legal requirements.
21.2.6 Systems enabling the delay, deferment or prevention of a change of control
The Company's bylaws do not contain any systems for delaying, deferring or preventing a change of
control.
21.2.7 Special stipulation governing changes in share capital
The Company's bylaws do not contain any particular stipulations governing changes in its share
capital.
285
22 KEY CONTRACTS
See section 7.2 of this document de base for a description of the contractual agreements enabling the
Group to carry out its business in China.
286
23 INFORMATION SUPPLIED BY THIRD PARTIES, EXPERTS' DECLARATIONS AND
DECLARATIONS OF INTEREST
None.
287
24 DOCUMENTS ACCESSIBLE BY THE PUBLIC
Copies of this document de base are available, free of charge, from the Company as well as on the
Company's website (http://corporate.Viadeo.com/fr/) and on the AMF website (www.amf-france.org).
All Company-related legal and financial documents to be made available to shareholders in
accordance with current regulations may be consulted at the Company's registered office.
On this basis, for as long as the document de base is in force, the following documents (or copies of
these documents) can, if necessary, be consulted:
- the Company's bylaws;
- any reports, correspondence and other documents, historical financial information, expert
assessments and declarations made at the issuer's request, some of which are included, or
referred to, in this document de base ;
- the issuer's historical financial information for each of the two fiscal years prior to the
publication of this document de base.
The aforementioned documents can be consulted in hard copy at the Company's registered office.
Please note that this document de base was prepared on the basis of annex XXV of (EU) delegated
regulation No. 486/2012 of March 2012 (proportionate schedule for SMEs).
288
25 INFORMATION ON HOLDINGS
Information relating to the subsidiaries listed in sections 7, 9 and 10 of this document de base.
289

- Viadeo Group

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