SEG-2018年第二季度SaaS并购报告（英文）-2018.7-33页-2mb

SEG 2Q18 SaaS M&A Update Summary

Core Content

This document provides a comprehensive overview of the SaaS M&A market activity in the second quarter of 2018, highlighting key trends, deal volumes, valuation metrics, and notable transactions. It also showcases the capabilities and success of Software Equity Group (SEG) in advising on SaaS M&A deals.

Main Points

• M&A Market Overview: The SaaS M&A market was vibrant in 2Q18, with a 11% increase in deal volume compared to 2017. Total SaaS M&A volume for 2018 is expected to reach around 950 deals.
• Deal Volume: In 2Q18, the software industry saw 675 transactions, an 8% increase from 1Q18. The average quarterly deal volume has exceeded 600 deals for the past six quarters.
• Revenue Multiples: The median TTM revenue multiple for SaaS companies in 2Q18 was 4.5x. Companies with revenue between $50M and $100M had the highest median multiple at 5.2x.
• Buyer Types: Publicly traded strategic buyers were more active in 2Q18, acquiring 87 companies, while private equity firms drove 105 deals, slightly down from 117 in 1Q18.
• Product Categories: The CRM & Marketing category led with 34 deals, followed by Analytics & BI with 30, and HR & Talent Management with 19.
• Vertical Focus: Healthcare software M&A activity was the most active vertical, accounting for 21% of all vertical deals, followed by Financial Services and Real Estate software, each at 13%.
• Regional Activity: North America dominated both target and acquirer regions, with 72.6% and 80% of transactions respectively. Europe followed with 21.1% and 13.8%.
• Notable Deals: Major acquisitions included Microsoft's $7.5B purchase of GitHub, Workday's $1.6B acquisition of Adaptive Insights, and Trimble's $1.2B acquisition of Viewpoint.

Key Information

SaaS M&A Highlights

• Deal Volume:
  • 226 SaaS deals in 2Q18.
  • 675 aggregate software industry M&A deals in 2Q18.
• Revenue Multiples:
  • Median TTM revenue multiple: 4.5x.
  • Companies with $50M–$100M revenue had the highest median multiple at 5.2x.
• Buyer Activity:
  • Publicly traded strategic buyers: 87 deals.
  • Private equity firms: 105 deals (16% direct investments, 30% strategic tuck-ins).
• Target Size:
  • 40% of SaaS targets had 50 employees or less.
  • 40% had between 50–200 employees.
  • 20% had more than 200 employees.
• Company Age:
  • One third of SaaS companies acquired were founded in the past eight years.
  • Another third were founded between 2000–2009.
  • Remaining companies were founded over 18 years ago.

Notable Transactions

Appendix Highlights

• SEG's Role: SEG served as exclusive advisor in numerous SaaS acquisitions, including HAPPY Software, StreamSend, and Bigfoot.
• Transaction Examples:
  • HAPPY Software acquired by MRI Software.
  • StreamSend acquired by j2 Global.
  • Bigfoot acquired by ClearCare.
• Other Notable Deals:
  • ChargePoint Inc. acquired Kisensum Inc.
  • Fog Software Group acquired Pace Software Inc.
  • Upland Software Inc. acquired RO Innovation Inc. for $14.3M.
  • Babyscripts acquired LULA B LLC.
  • PayPal Holdings Inc. acquired Simility Inc. for $120M.
  • Medidata Solutions acquired SHYFT Analytics for $195M.
  • Workday Inc. acquired Adaptive Insights for $1,545.9M.

Summary

This report underscores the robustness and growth of the SaaS M&A market in 2Q18, with increased deal volume and a wide range of activity across product categories, verticals, and regions. SEG continues to demonstrate its expertise in facilitating these transactions, providing strategic advice and achieving competitive valuations for its clients. The report also highlights the importance of company size, industry trends, and buyer types in shaping M&A outcomes.