powering global commerce SeeThruEquity & The Brewer Group Investor Conference February 22, 2016
Net Element | Disclaimer Forward-looking statements. Use of Non-GAAP financial measures This presentation and comments made by management contain forward-looking statements including, among others, statements regarding the expected future operating results of Net Element, Inc. (“Net Element” or the “Company”). These statements are based on management’s current expectations and assumptions and are subject to risks, uncertainties and changes in circumstances. Forward-looking statements include all statements that are not historical facts and can be identified by the use of forward-looking terminology such as the words “believe,” “expect,” “anticipate,” “intend,” “plan,” “estimate” or similar expressions. Actual results may differ materially from those set forth in the forward-looking statements due to a variety of factors. More information about these risks, uncertainties and factors may be found in Net Element’s Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K. Net Element does not assume any obligation to update any forward-looking statements as a result of new information, future developments or otherwise. This presentation contains certain non-GAAP financial measures determined by methods other than in accordance with generally accepted accounting principles. Such non-GAAP financial measures include: general and administrative expense before non-cash compensation expense. Management uses these non-GAAP financial measures to assess the performance of Net Element’s core business. Net Element believes that these non-GAAP financial measures provide meaningful additional information about Net Element to assist investors in evaluating Net Element’s operating results. These non-GAAP financial measures should not be considered as a substitute for operating results determined in accordance with GAAP and may not be comparable to other similarly titledmeasures ofother companies. www.netelement.com 2
Net Element | Overview Emerging as a leader in mobile payments and transactional services Global financial technology company specializing in mobile payments and value-added transactional services in the U.S. and fast growing emerging markets. § Net Element, Inc. (NASDAQ: NETE) § $21.2 million Revenue in FY2014 § $25.2 million for Nine Months ended Sept 30, 2015 - (59.9% growth year-over-year) § Active in 9 markets - U.S., Canada, Europe, Asia, Russia, Kazakhstan, Kyrgyzstan, Azerbaijan, UAE § Leading positions in online and mobile payments § Highly active in world’s fastest growing markets § 150 people including 30 IT engineers 100+ payment 161 million � Processing volume of � � methods in transactions $1.8 billion in 2015 50 countries processed in 2015 www.netelement.com 3
Net Element | Overview Emerging as a leader in mobile payments and transactional services Who is Net Element? Who is Net Element? Our Mission and Vision Our Mission and Vision • Emerging leader in mobile payments, transactional • Mission: We drive customer growth through our in- and value-added services depth knowledge of transactional services and value- added service offerings which separate us from the • Growth drivers: mobile commerce and value-added competition transactional services (“VAS”) • Vision: We set the standard for mobile payments, • Key differentiators: Our scalable operational online transaction acceptance, Person-to-Person infrastructure, commerce expertise, scalable mobile (“P2P”) transactions and value-added service offerings payments platform, world-class cloud infrastructure with focus on creation of unified global transaction and emerging market presence acceptance ecosystem We Have a Focused Strategy Our Opportunity is Significant • Continued investment in our core technology and new • Market is large and moving to where we have strength product offerings • Global customer expansion and strong growth in • Allocate resources and expertise to grow in commerce payment acceptance and payments segments • Ride the wave of the growing mobile payments • Strategic acquisitions which complement our core market: Deloitte predicted 1,000% growth in mobile strategy payments in 2015 • Focus on continued improvement and operation excellence www.netelement.com 4
Growth Drivers | Focus on 3 areas Combination of all devices and technologies for multi-channel payments acceptance § Mobile Payments • Carrier integrated solutions Mobile Payments • Premium SMS Point of Sale Solutions Direct Carrier Billing • In-app purchases • WAP/Internet click payments § Point of Sale Solutions TRINITY • Cloud-based mPOS solution PLATFORM • iOS-based self-serve kiosk • Digital menu Payment Acceptance § Payment Acceptance Value-Added Transactional Services • Proprietary platform • Retail POS acceptance • Card not present acceptance • Mobile payments acceptance GROUP • Multiple payment methods • PCI DSS Level 1, SSL 3.1 Security 11 million+ online 71 million 3 million+ recurring 90 million payment acceptance bankcard transactions mobile payments mobile transactions customers processed in 2015 users processed in 2015 www.netelement.com 5
Growth Drivers | One-Stop Solution Bringing together the best payment solutions § Complete Solution Combines e-commerce, retail POS, Merchant Consumer comprehensive back office tools, mPOS, credit scoring and customer interaction in one powerful technology � � � � � § Integration APIs and connectors allow integration and customization. Our tools allow for Merchant Payment Risk Consumer Card Account Gateway Compliance Account Issuing easy integration and our SDK toolkit for building native apps for our omni- w O � S � � � � E � � � c channel platform § OMNI-Channel Processing Enabling Global Commerce SOLUTIONS � Our payment infrastructure and � 1 Integration APIs 100+ PAYMENT services are globally oriented, but � 1 Back Office WITH � 1 Settlement adapted to each country’s unique � 1 Dedicated Team requirements 11 million+ online Processing volume of 3 million+ recurring 161 million payment acceptance $1.8 billion in 2015 mobile payments transactions customers users processed in 2015 www.netelement.com 6
Growth Dynamics | United States United States merchant strategy United States 51.2 million bankcard transaction in 2015 (45% year-over-year growth in transactions) • Over 10,000 SME merchants • Over $1 billion in volume processed in 2015 • Avg. annual revenue $1,800 per merchant • Average upfront Cost Per Acquisition $228 • Increased revenue per merchant for value added services $240 per annum Features: Apple Pay; Android Pay; NFC enabled; Mobile card readers; Secure & reliable; 24/7 service Value-add services: shopping cart; rewards and loyalty programs; back office tools; inventory management; credit scoring; analytical dashboard Partners include top brands www.netelement.com 7
Growth Dynamics | CIS Mobile payments strategy Russian Federation and CIS 90 million mobile transactions in 2015 (106% year-over-year growth in transactions) • Over 3 million mobile payment users • Over 100 content providers use TOT Money • Ranked as #1 SMS content provider in Russia • Avg. subscription annual billings ~ $12 per user • Mobile payment users increased by 300% year-over-year Features: Premium SMS; Direct operator billing; WAP automated phone; Web billing; in-app billing Value-add services: content management gateway; SMS gateway; API integration; short code number procurement; analytical dashboard Partners include top brands www.netelement.com 8
Growth Dynamics | Emerging Markets Online payments strategy Emerging Markets 19.5 million online transactions in 2015 (36% year-over-year growth in transactions) • Over 11 million online payment users • Over 3,000 merchants in CIS, EU and Asia • #1 IPSP in Russia, 30% market share • According to Forbes, 20% of leading online merchants in Russia are clients of PayOnline • Approx. 40% of revenue is in EUR€ / US$ Features: E-commerce gateway; E-wallet; Mobile in-app payments SDK; PCI DSS level 1 security; P2P transfers Value-add services: shopping cart; GDS’ merchant plug-in; fraud monitoring; back office tools; credit scoring; BIN and IP scrubbing; analytical tools Partners include top brands www.netelement.com 9
Our Clients | Center of Our Success Growing portfolio of international clients According to Forbes, 20% of leading e-Commerce merchants in Russia use PayOnline platform to accept payment transactions in Russia, Europe and Asia. www.netelement.com 10
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