2023-01-08-GP_Bullhound-欧洲SaaS报告（英）_39页_2mb

GP.Bullhound European SaaS Report Summary (2022)

Core Content

This report from GP Bullhound, in partnership with Sage, provides an in-depth analysis of the European SaaS market based on a survey of over 100 SaaS company founders and CEOs. It covers key metrics such as growth, revenue retention, capital efficiency, and M&A activity, offering insights into the sector's resilience and evolution in the face of macroeconomic uncertainty.

Main View

• Optimism in the SaaS sector: Despite macroeconomic challenges, European SaaS companies show strong resilience.
• Growth and Capital Raising: 80% of surveyed CEOs cited revenue growth as their top priority, with over one-third planning to raise capital in the next year.
• M&A and Fundraising Trends: Deal volume in 2022 remains above 2019 and 2020 levels, while the average deal size has tripled, with mega-deals (>€1bn) now accounting for 73% of deal value.
• Valuation Convergence: Public SaaS valuations in Europe and the US are converging after a period of divergence since the pandemic, driven by a focus on profitable growth.

Key Takeaways

ARR Growth

• Median ARR growth doubles from 20% to 40% as businesses scale from €25m to €50m+ ARR.
• Companies with over €50m ARR typically achieve an ARR per FTE of €140K.

Revenue Retention

• Enterprise SaaS has a higher gross revenue retention (95%) compared to SME-focused SaaS.
• SME SaaS demonstrates higher net expansion, which reduces the gap in net revenue retention (NRR) with Enterprise SaaS.

CAC and Payback Period

• CAC for European SaaS companies is typically below €40K, with longer-term contracts (e.g., >3 years) having higher costs.
• The payback period for SaaS companies typically ranges from 7 to 15 months, with Infrastructure & Cybersecurity contracts having the longest payback periods.

Operational Efficiency

• Gross margin stabilises at around 80% for companies with ARR over €5m.
• Sales & Marketing costs overtake R&D costs as a proportion of revenue once companies exceed €5m ARR, peaking at 40% of revenue.

Capital Efficiency

• The average capital efficiency ratio for European SaaS companies with ARR over €5m is around 3:1.
• Fundraising activity in 2022 YTD is still higher than 2021 YTD, with the average fundraising size tripling from 2019 to 2022.

M&A Activity

• European SaaS M&A deal value in 2022 YTD reached €32.3bn, surpassing the combined value of 2019 and 2020.
• Mega-deals (>€1bn) account for 73% of the total deal value in 2022, up from 30% in 2019.
• The UK, France, and Germany account for 65% of European SaaS deal volume, with the UK showing the most resilience in fundraising.

Unicorn Growth

• Europe has seen continued momentum in the creation of new SaaS Unicorns, with more emerging in 2022 than in the previous three years combined.

Valuation Trends

• Public SaaS valuations in Europe and the US are converging, with European companies showing stronger profitability.
• European SaaS has an average EBITDA margin of 31% for CY22E, compared to 14% for the US, while the US has a higher revenue growth rate (44%) than Europe (15%).

About GP Bullhound

• Founded in 1999, GP Bullhound has a strong global track record in software transactions.
• They have advised on over 640 successful transactions with a total transaction value of over $39bn.
• They manage funds with AUM of over $1bn and operate from 12 office locations globally.

Survey Team

• Partner: Alexis Scorer
• Director: Joe Tabberer
• Associate: Oliver Connick
• Analysts: Nikolay Papazov, Yannick Noesen

Disclaimer

• The report is for informational purposes only and not a binding offer or commitment.
• It is intended for sophisticated investors with a high degree of financial knowledge.