SEG-2022年度SaaS报告（英）-73页_4mb

SEG 2022 Annual SaaS Report Summary

Core Content

This report provides an in-depth analysis of the SaaS (Software as a Service) market in 2021, focusing on public market performance, M&A activity, and key financial metrics across the SEG SaaS Index. It highlights trends in valuation multiples, revenue growth, profitability, and the role of private equity in SaaS acquisitions.

Main Points

SEG Overview

• SEG is a leading M&A advisory firm with over 30 years of experience in the B2B software sector.
• They specialize in sell-side advisory services and have built a broad network of software industry buyers and investors.
• SEG has facilitated billions in aggregate transaction value and maintains relationships with thousands of buyers.

SaaS Public Market Update

• The SEG SaaS Index includes 97 publicly traded companies that primarily offer cloud-based solutions.
• In 4Q21, the median EV/Revenue multiple reached a record 14.7x, up 20% YOY.
• The median TTM revenue surpassed $600M for the first time in 4Q21, with a 27.2% growth rate.
• Snowflake (99.7x), Bill.com (92.3x), and Cloudflare (90.1x) led the index in EV/Revenue multiples.
• Dev Ops & IT Management (17.4x) and Communications & Collaboration (16.5x) were the top product categories in median EV/Revenue multiples.
• Despite the high multiples, the SaaS sector remains largely unprofitable, with a median EBITDA margin of -3.1%.
• Free cash flow margin improved significantly over the past two years, from 4.5% in 2019 to 9.7% in 2021.

Market Trends

• YTD stock market performance was mixed, with the SaaS Index starting 2021 at a historical high but ending the year down 9%.
• High-growth companies faced a significant correction in multiples in 4Q21 as investors moved away from riskier assets.
• Companies with higher EBITDA margins saw an increase in multiples by 15% YOY.
• The Rule of 40% (a weighted formula combining revenue growth and profitability) showed that companies with higher scores were rewarded with higher revenue multiples.

Top 25% and Bottom 25% of the Index

• Top 25% of the SEG SaaS Index had a median EV/Revenue multiple of 38.3x, significantly higher than the overall index median of 13.9x.
• Top performers included companies like Snowflake, Bill.com, and Shopify with strong revenue growth and EBITDA margins.
• Bottom 25% had a median EV/Revenue multiple of 4.0x, which is less than a third of the index median.
• Companies in this range, such as Vertex, Sumo Logic, and Verint Systems, showed lower revenue growth and profitability.

SaaS M&A Market Update

• Aggregate SaaS M&A deal volume in 2021 reached 1,800 transactions, a 40% increase YOY.
• SaaS M&A accounted for over 50% of total software industry deal volume in 2021.
• The median EV/Revenue multiple for SaaS deals in 2021 was 7.3x, a 28% increase from 5.7x in 2020.
• Private equity dominated the market, comprising 55% of all SaaS deals, with 40% being PE-backed and 15% direct PE deals.
• Healthcare software was the most active vertical, making up 20% of all vertical SaaS deals.
• Notable mega-deals included:
  • Oracle acquiring Cerner for $29.6B
  • Square acquiring Afterpay for $28.6B
  • Bain Capital / Hellman & Friedman acquiring Athenahealth for $17B

Key Financial Metrics

Key Insights

• The SaaS market experienced a significant increase in deal volume in 2021, with SaaS M&A transactions reaching a record 1,800.
• Private equity became the dominant buyer, with 55% of all SaaS deals being PE-driven.
• Healthcare software remained the most active vertical, representing 20% of all vertical SaaS deals.
• Top performers in the SaaS public market included companies like Snowflake, Bill.com, and Shopify, which had high revenue growth and EV/Revenue multiples.
• Free cash flow improved over the past two years, indicating better operational efficiency.
• EV/Revenue multiples for the index remained high despite the sector's unprofitability, suggesting strong investor confidence in growth potential.
• The Rule of 40% showed a clear correlation between revenue growth and valuation multiples, with higher growth leading to higher multiples.

Conclusion

The 2021 SaaS market was marked by record deal volume, a significant increase in valuation multiples, and a shift in investor focus towards more stable, profitable companies. Private equity played a pivotal role in driving M&A activity, while healthcare software remained the most active vertical. The report highlights the importance of the Rule of 40% in evaluating SaaS companies and underscores the continued growth and transformation of the SaaS industry.