John Mecke
Jul 8 · 2 min read

The Software Equity Group has published their second quarter 2019 SaaS M&A update. You can download the entire report here (free, email registration required). As usual it contains a ton of valuable information.

Highlights

  • The SaaS M&A market continued to roar, as each of the past four quarters posted above 250 transactions. Valuations remained strong, as 2Q19 posted a median of 4.6x EV/Revenue, a high point for the SaaS M&A market.
  • The composition of SaaS targets indicated that the majority of companies were not VC funded (60% of targets), based in North America (76% of targets), and SMBs with less than 150 employees (59%).
  • CRM & Marketing deal volume increased approximately 27%, posting 47 deals in 2Q19, compared to 1Q19’s 37 deals.
  • Healthcare, Real Estate, and Education were the most active verticals over the past three years.
  • Select notable Healthcare transactions include The Riverside Company’s acquisition of emaTerra

Enterprise Value/Revenue Multiples

Revenue multiples remain high with a median multiple of 4.6x. The trend of subscale revenue companies trading at a discount to $100M enterprises continues

SEG q2 2019 SaaS M&A Revenue multiples
SEG q2 2019 SaaS M&A Revenue multiples
SEG Report

Life Span Before Acquisition

SEG Report

Other Contents

The report contains a lot of other valuable content including transaction count by industry, three year valuation trends, deal count by product category/vertical, deal count by business model, deal count by buyer and target backing, M&A activity by region, and a listing of the 250+ transactions that closed in Q2.

Once again, here is the link to the full report.


Originally published at Development Corporate.

Development Corporate

Musings of a reformed private equity operator on product management and corporate development

John Mecke

Written by

John has over 20 years of experience in leading product management and corporate development organizations for enterprise firms.

Development Corporate

Musings of a reformed private equity operator on product management and corporate development

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