GP.Bulhound-2019年Q1全球软件市场报告（英文）-2019.3-46页_2mb

GP Bullhound Q1 2019 Software Market Summary

Core Content

GP Bullhound is a leading technology advisory and investment firm that focuses on Software, providing transaction advice and capital to category leaders. This quarterly report highlights key trends in the Software market, including M&A activity, private financing, public market valuations, and insights from SaaS CEOs. It also features notable deals and metrics relevant to the Software industry.

Main Trends and Insights

1. Rise of the Monoclouds

• Major cloud providers like Adobe, Amazon, Google, Microsoft, and Salesforce are leading the monocloud movement, offering integrated services on a single platform.
• These companies have substantial financial resources, enabling strong engineering teams to enhance their platforms rapidly.
• Startups can partner with cloud providers to offer specialized services for these ecosystems, thereby increasing their value proposition.

2. Recent Software Transaction Trends

• M&A and private placement activity have been increasing, with a notable rise in deal values.
• The US and Europe continue to dominate M&A deal volume.
• The median enterprise SaaS deal size increased to $70m in 2018 from $34m in 2017.

3. Public Market SaaS Analyses

• SaaS companies are seeing higher valuations, with current valuations exceeding the five-year mean.
• The Rule of 40% states that companies with combined revenue growth and FCF margin over 40% are valued higher.
• Public SaaS companies are experiencing growth and profitability, with significant increases in revenue and margins.

4. SaaS CEO Commentary

• Appetize: A modern POS, inventory, and analytics SaaS platform. CEO Max Roper emphasizes the need for intuitive and data-driven solutions in retail.
• Cartegraph: A SaaS provider for local government agencies. CEO Josh Mallamud discusses the increasing reliance on smart devices and technology adoption in government.
• Kognity: A digital textbook provider. CEO Hugo Wernhoff highlights the potential of SaaS to transform education.

5. Key SaaS Metrics

• MRR (Monthly Recurring Revenue): A key metric for recurring revenue, calculated as the number of paying customers multiplied by ARPA (Average Revenue Per Account).
• CAC (Customer Acquisition Cost): S&M expenses for new customers, typically paid back within 6-12 months for SMEs and 9-15 months for Enterprise.
• CLV (Customer Lifetime Value): The NPV of recurring gross profit of a customer less the initial cost of customer acquisition. CLV should be between 3-4 years for SMEs and 5-7 years for Enterprise.
• Churn: Gross churn is the number of customers lost, while net churn considers account expansion. Top companies have net churn of <5% and MRR renewal rates of 105-110%.
• Free Cash Flow / Burn Rate: Important for understanding growth and capital efficiency.

Notable Deals

M&A Transactions

Private Financings

Public Market SaaS Valuations

• Salesforce: Market Cap $125.192bn, EV $126.133bn, EV/Rev 9.5x, CY Revenue Growth NA
• Workday: Market Cap $43.545bn, EV $42.971bn, EV/Rev 15.2x, CY Revenue Growth 25.0%
• ServiceNow: Market Cap $43.219bn, EV $42.383bn, EV/Rev 16.2x, CY Revenue Growth 31.4%
• Square: Market Cap $34.096bn, EV $33.872bn, EV/Rev 10.3x, CY Revenue Growth (31.4%)

Key Sector Takeaways

• The SaaS market is robust, with increasing valuations and M&A activity.
• Cloud providers are expanding their platforms, creating opportunities for startups.
• The Salesforce AppExchange is a significant growth driver for SaaS providers.
• HCM software is a key focus area, with PE roll-ups expected to dominate.
• Zero Trust Cloud Security is becoming an industry standard.
• SaaS companies are focusing on improving CAC payback periods and CLV.

Conclusion

The Software market in Q1 2019 shows strong growth and consolidation trends. M&A activity is driven by the desire to expand enterprise software portfolios, particularly in AI, data, and analytics. The Salesforce AppExchange and new-age POS solutions are key growth areas. SaaS companies are expected to continue leveraging these trends, with a focus on improving customer metrics and capital efficiency. The industry is evolving rapidly, with a growing emphasis on security and technology integration.