SaaS M&A Valuations Soar to New Post Recession High, as Software and Internet Exit Valuations Soften; Public Software Company Revenue Growth Slows but Market Valuations Remain Healthy For Now; IPOs Post Stellar Results
Software Equity Group’s complimentary 1Q12 Software Industry Equity Report is now available for download. Our 1Q12 Report provides the facts, data and insight you need to keep your finger on the software industry’s pulse. We’ve assessed how public software, Internet and SaaS companies performed in Q1; how they’ve performed amid the current macro environment and technological disruptions driven by mobile and cloud computing and how their stock prices and market valuations have responded. Our 1Q12 Report also enumerates and analyzes the software IPOs through 2012 and measures M&A deal volume and exit valuations overall and by software product category.
- •64 SaaS companies were acquired in 1Q12, accounting for 16% of all software transactions and up from 3% only two years ago. The SaaS median exit multiple reached a new high. What SaaS product categories are on fire?
- •1Q12’s median EV/Revenue exit multiple was 1.9x for traditional, on-premise software companies. The median only tells part of the story, how many companies achieved exit multiples above 5.0x? Below 1.0x?
- •Internet M&A transactions in 1Q12 increased 25% YoY. What Internet product categories are leading the charge and why?
- •Among the on-premise software product categories we track, which accounted for a whopping 20% of all software M&A deals in Q1, but fetched a median exit multiple of only 1.6x, despite one high profile exit at 20x!!!
- •Are investors rewarding revenue growth over EBITDA margin in this macro environment? Our analysis paints a clear picture of what investors want.
- •The TTM revenue growth rates of public SaaS companies grew for the fifth consecutive quarter in 1Q12. How are SaaS companies investing to fuel this growth, and what’s the EBITDA impact?
- •The IPO market was especially robust in 1Q12. Find out who the top performers were and how they’ve fared post-IPO.
Software Equity Group’s Quarterly and Monthly Reports are widely recognized as the best way to keep your finger on the financial pulse of the software industry. As testament, our reports are now read and relied upon by more than twenty thousand software industry executives, entrepreneurs, venture capitalists, private equity investors and professional advisors in 72 countries around the globe. Shouldn’t you know what they know?
To obtain your complimentary copy, please visit: http://www.softwareequity.com/research_quarterly_reports.aspx.
Director, Business Development
About Our Firm
Software Equity Group is an investment bank and M&A advisory serving the software and technology sectors. Founded in 1992, our firm has guided and advised companies on five continents, including privately-held software and technology companies in the United States, Canada, Europe, Asia Pacific, Africa and Israel. We have represented public companies listed on the NASDAQ, NYSE, American, Toronto, London and Euronext exchanges. Software Equity Group also advises several of the world’s leading private equity firms. We have been ranked among the top ten investment banks worldwide for application software mergers and acquisitions.