SEG SNAPSHOT SaaS Public Market 3Q17 Update 1 淘宝店铺 “Vivian研报” 首次收集整理 获取最新报告及后续更新服务请在淘宝搜索店铺 “Vivian研报” 或直接用手机淘宝扫描下方二维码 Select SEG 2017 Transactions SEGs Broad Network of SaaS Buyers Strategic M&A: Sell-side representation of emerging and established software companies. Majority Recapitalizations: Majority investments from software- focused private equity investors that look to provide shareholder liquidity and growth capital to established software companies. Divestitures: Sell-side representation of divisions of public and large private software companies. Board Advisory: Strategic guidance and advice to business owners preparing for a future liquidity event, whether that be months or years down the road. Services: Please contact Kris Beible at kbeible or visit our website for more information 2 Select SEG 2017 Transactions Software Equity Group (SEG) provides unparalleled M&A advisory services for emerging and established software companies. Copyright 2017 by SEG Capital Advisors, LLC. All Rights Reserved 3 “The SEG teams integrity, experience, knowledge, judgement, and dedication was exemplary during the sale of our business. We achieved an outcome that exceeded my objectives, both in financial terms and in the long term success of our employees and customers. I know without a doubt that retaining SEG was the highest ROI investment we ever made as a company.” Buyer: Agilent Technologies Inc. (NYSE:A) Seller: iLab Solutions LLC What Our Clients Say “SEG provided valuable mentoring for 10 years before selecting them as my advisor. They demonstrated a strong expertise in my industry and clearly outlined what the process would be like. Overall, I was impressed with SEGs performance as they drove an optimal outcome.” Buyer: True Commerce Seller: Datalliance Tad Fallows, Founder & CEO iLab Solutions LLC Carl Hall, President & CEO Datalliance See More Info See More Info Copyright 2017 by SEG Capital Advisors, LLC. All Rights Reserved 4 64 The number of companies comprising the SEG SaaS Index. Four companies in the Index announced an intent to be acquired. Additionally, while we have not added any new companies to our index in 3Q17, there are a number of companies that have filed and are expected to IPO in Q4. 6.6xThe median EV/Revenue multiple for SaaS companies in 3Q17, one of the highest multiples since 2Q14s 6.8x median multiple. The quarters EV/Revenue multiple of 6.6x also represents a 10% year-over-year (YOY) increase from 3Q16s 6.0x multiple. 27.8% The median TTM revenue growth rate for SaaS companies in 3Q17. While consistent with last quarters 27.6% mark, the TTM revenue growth rate decreased 5.1% from 3Q16s 32.9% median revenue growth rate. Read more on page 6. ERP & Supply Chain The product category posting the highest EV/Revenue multiple (8.7x) in 3Q17, representing a 32% premium over the Index median of 6.6x. For more product category valuations, see page 12. 8.2x The valuation of companies posting 30%-40% TTM Revenue Growth, a 3.8% premium over companies with 50% or higher TTM Revenue Growth (trading at 7.9x). Companies in the 30%-40% growth range posted higher valuations due to a healthier EBITDA margin. See more on page 10. -5.4% The median EBITDA margin for SaaS companies in 3Q17, the highest margin SaaS companies have posted in 13 quarters. Since 4Q14, the median EBITDA margin has been steadily trending toward breaking even. Read more on page 7. SUMMARY Q3 2017 SaaS Public Market Trends *All 3Q17 data is measured July 1 to September 30, 2017 Copyright 2017 by SEG Capital Advisors, LLC. All Rights Reserved 5 Q3 2017 SEG SaaS Index The SEG SaaS Index tracks public companies that primarily offer their solutions via the cloud and through a subscription or transaction based pricing model. The Index is currently comprised of 64 publicly traded companies. SEG SaaS Index Companies SEG - SaaS: Median Metrics Measure3Q164Q161Q172Q173Q17* EV/TTM Revenue6.0x5.7x5.7x6.6x6.6x EV/NTM Revenue5.1x4.3x4.6x5.4x5.5x EV/EBITDA43.3x32.7x36.7x42.4x45.2x EV/TTM CFO37.7x35.8x38.0x40.2x44.8x Gross Profit Margin66.8%67.2%67.9%68.6%68.5% EBITDA Margin-7.4%-6.4%-6.8%-6.7%-5.4% Net Income Margin-16.1%-15.0%-14.7%-12.6%-11.2% TTM Revenue Growth32.9%28.2%30.9%27.6%27.8% TTM Total Revenue ($M)$189.9$201.5$206.7$223.2$238.5 TTM EBITDA Growth25.0%22.3%21.1%18.0%22.2% TTM Total EBITDA ($M)-$10.7-$9.5-$10.6-$11.4-$11.0 Cash & Eq ($M)$95.3$111.1$107.7$115.3$124.1 *All 3Q17 data is measured July 1 to September 30, 2017 Copyright 2017 by SEG Capital Advisors, LLC. All Rights Reserved 6 Operating Metrics: Revenue TTM Revenue Growth Rate Distribution The median TTM revenue growth rate of public SaaS companies in 3Q17 was 27.8%, up slightly from 2Q17s 27.6% rate. Median TTM revenue of public SaaS companies was $238.5 million in 3Q17, a 25.6% YOY increase from 3Q16s $189.9 million TTM revenue. Approximately 20% of public SaaS companies generated TTM revenue growth of 40% or more in 3Q17, a notable decr