Sep 26, 2016 - Criteria based on internet/digital media/SaaS Series A and subsequent rounds of global ...... management
Internet / Digital Media / SaaS Sector Report Week of April 3rd, 2017 1
DEAL DASHBOARD Internet / Digital Media / SaaS 177
$13.8 Billion
$13.5 Billion
21
2017 Financing Transactions (1)(3)
2017 Financing Volume (1)(3)
2017 M&A Volume (4)
2017 M&A Transactions (4)
Quarterly Financing Volume ($Bn) (1)(2)(3)
Quarterly M&A Volume ($Bn) (4)
Select M&A Transactions
Select Financing Transactions Company
Amount ($MM) $1,003.3 $400.0 $115.0 $106.0 $104.0
$15
$13 $9
$10
$8
$7
$0
$55.0
$60 $50 $40 $30 $20 $10 $0
250 194
150
143 149
210 201
226
Acquirer
$55 $36 $16
$20 $21
Target (H R & B e n e f it s B P O )
$14 $14
167 177
50
10
0
0
$3.9
$0.8 $0.6
32
30 20
$4.3
$0.8
40
184
EV ($Bn)
$6
$4
Quarterly M&A Deal Count (3)
Quarterly Financing Deal Count (1)(2)
100
$56.0
$8
$5
200
$61.1
$14
$14
$11 $10
32
31 25
17
20
25
26
21
$0.4 $0.4 $0.3
Last 12 Months Digital Media Price Performance vs. S&P 500 (5) 23% 14%
2
DM Composite Notes: SPX Source: Capital IQ, PitchBook, and Dow Jones VentureSource. 1) Criteria based on internet/digital media/SaaS Series A and subsequent rounds of global financings greater than or equal to $10MM. 2) Excludes the $7.3Bn raise by Didi Chuxing on 6/15/2016. 3) Financings include Venture and Private Equity Growth/Expansion activity for internet/digital media/SaaS sectors. 4) Criteria based on global target internet/digital media/SaaS M&A deals with transaction enterprise values greater than $50MM. Excludes AT&T’s acquisition of Time Warner announced 10/22/2016. 5) Search/online advertising composite, internet commerce composite, internet content composite, diversified marketing composite, SaaS composite and social media composite used as proxy for internet/digital media/SaaS landscape. Details on companies included can be found on the public valuation company slides.
INDUSTRY STOCK MARKET VALUATION Internet / Digital Media / SaaS
Last 12 Months
Last 3 Months 130%
150%
45.1% 40.8%
140%
21.2% 20.7% 17.8%
120%
130%
26.2%
110%
20.8% 18.1% 15.1% 14.6% 14.4%
100%
0.7% 0.5%
120%
15.7%
110%
9.5% 8.9% 6.7% 5.2% 3.2%
100%
0.2%
90%
80% 4/4/2016
5/26/2016
7/17/2016
9/7/2016
Search / Online Advertising
(1)
10/29/2016
12/20/2016
2/10/2017
Internet Commerce
(2)
(5)
Diversified Marketing
3
90% 1/3/2017
4/3/2017
Media Conglomerates
1/18/2017
Internet Content
(6)
Gaming
(7)
(3)
2/2/2017
2/17/2017
Publishers
SaaS
(8)
3/4/2017
(4)
3/19/2017
4/3/2017
NASDAQ
Social Media
Notes: (1) Search/Online Advertising Composite includes: CRTO, GOOGL, FUEL, MCHX, MRIN, MSFT, MXPT, QNST, RTHM, RUBI, TRMR, TTD, YNDX, YUME. (2) Internet Commerce Composite includes: AMZN, ANGI, BABA, CMPR, CPRT, EBAY, ETSY, EXPE, FLWS, GRUB, NFLX, OSTK, PCLN, PRSS, QUOT, QVCA, SSTK, STMP, TRVG, TZOO. (3) Internet Content Composite includes: CRCM, DHX, EHTH, GDDY, IAC, RATE, RENN, SCOR, SFLY, TGNA, TTGT, WBMD, WEB, XOXO, ZG. (4) Publishers Composite includes: GCI, GHC, MMB-FR, NWSA, NYT, PSON-GB, SSP, TIME, TRI, UBM-GB. (5) Diversified Marketing Composite includes: ACXM, ADS, EFX, EXPN-GB, HAV-FR, HHS, IPG, MDCA, NLSN, WPP-GB. (6) Media Conglomerates Composite includes: CBS, CMCSA, DIS, DISCA, FOXA, SNI, SONY (6758-JP), TRCO, VIAB. (7) Gaming Composite includes: ATVI, CYOU, DENA (2432-JP), EA, GAM, GLUU, GREE (3632-JP), GHO (3765-JP), NVR (A035420-KR), NCSOFT(A036570-KR), NTES, TENCENT (700-HK) ,UBI-FR, ZNGA. (8) SaaS Composite includes: APPF, APTI, BCOV, BOX, BV, COUP, CRM, CSOD, ECOM, EVBG, HUBS, JIVE, LPSN, MB, MRIN, NOW, NTNX, RNG, RP, SHOP, ULTI, WDAY, XTLY, ZEN. (9) Social Media includes: FB, LINE (3938-JP), P, SNAP, TWTR, YELP.
(9)
INDUSTRY STOCK MARKET VALUATION Internet / Digital Media / SaaS: Financial Metrics
EV / 2017E Revenue 9.0x 8.0x
EV / 2017E EBITDA 30.0x
25.6x
7.8x Mean: 3.3x Median: 2.8x
7.0x 6.0x 5.0x 4.0x 3.0x 2.0x
20.0x
4.3x
Mean: 13.4x Median: 11.4x
16.6x 13.5x
3.3x
3.0x
2.8x
2.6x
12.5x 11.4x
2.4x
10.0x
1.8x
11.2x
10.5x
9.9x
1.6x
1.0x 0.0x
4
0.0x
Notes: (1) Search/Online Advertising Composite includes: CRTO, GOOGL, FUEL, MCHX, MRIN, MSFT, MXPT, QNST, RTHM, RUBI, TRMR, TTD, YNDX, YUME. (2) Internet Commerce Composite includes: AMZN, ANGI, BABA, CMPR, CPRT, EBAY, ETSY, EXPE, FLWS, GRUB, NFLX, OSTK, PCLN, PRSS, QUOT, QVCA, SSTK, STMP, TRVG, TZOO. (3) Internet Content Composite includes: CRCM, DHX, EHTH, GDDY, IAC, RATE, RENN, SCOR, SFLY, TGNA, TTGT, WBMD, WEB, XOXO, ZG. (4) Publishers Composite includes: GCI, GHC, MMB-FR, NWSA, NYT, PSON-GB, SSP, TIME, TRI, UBM-GB. (5) Diversified Marketing Composite includes: ACXM, ADS, EFX, EXPN-GB, HAV-FR, HHS, IPG, MDCA, NLSN, WPP-GB. (6) Media Conglomerates Composite includes: CBS, CMCSA, DIS, DISCA, FOXA, SNI, SONY (6758-JP), TRCO, VIAB. (7) Gaming Composite includes: ATVI, CYOU, DENA (2432-JP), EA, GAM, GLUU, GREE (3632-JP), GHO (3765-JP), NVR (A035420-KR), NCSOFT(A036570-KR), NTES, TENCENT (700-HK) ,UBI-FR, ZNGA. (8) SaaS Composite includes: APPF, APTI, BCOV, BOX, BV, COUP, CRM, CSOD, ECOM, EVBG, HUBS, JIVE, LPSN, MB, MRIN, NOW, NTNX, RNG, RP, SHOP, ULTI, WDAY, XTLY, ZEN. (9) Social Media includes: FB, LINE (3938-JP), P, SNAP, TWTR, YELP.
9.4x
PUBLIC COMPANY VALUATIONS Internet / Digital Media / SaaS: Financial Metrics (Cont’d) $MM, Except Per Share Data
Search / Online Advertising Alphabet Inc. Microsoft Corporation Yandex N.V. Criteo SA (1) The Trade Desk, Inc. (1) The Rubicon Project, Inc. (1) RhythmOne plc (2) Rocket Fuel Inc. QuinStreet, Inc. YuMe, Inc. Marchex, Inc. Tremor Video, Inc. Marin Software Incorporated MaxPoint Interactive, Inc.
Trading Statistics
Stock Price 4/3/17
LTM Price Range High Low
$856.75 65.55 22.13 50.62 37.02 5.63 0.53 5.11 3.64 4.01 2.65 2.05 1.80 6.09
$672.66 48.04 14.72 32.83 22.00 5.39 0.19 1.70 2.61 3.11 2.46 1.45 1.45 3.85
$874.42 66.19 25.00 52.87 46.21 20.37 0.59 5.48 4.32 4.36 4.55 2.76 3.29 11.94
Equity Value $592,374 506,540 7,156 3,239 1,450 272 262 236 165 136 114 103 71 40
Cash & Equiv.
Net Debt
$86,333 121,205 1,030 270 133 190 41 84 37 60 104 43 34 24
($82,398) (33,399) (723) (185) (108) (190) (41) 2 (37) (60) (104) (42) (31) 3
Enterprise Value $509,976 473,141 6,457 3,064 1,343 82 222 239 128 76 10 61 40 44 Mean Median
Internet Content Zillow Group, Inc. IAC/InterActiveCorp TEGNA Inc. GoDaddy Inc. WebMD Health Corp. Shutterfly, Inc. comScore, Inc. (2) Web.com Group, Inc. Bankrate, Inc. Renren Inc. (2) XO Group Inc. Care.com, Inc. TechTarget, Inc. DHI Group, Inc. eHealth, Inc.
$34.04 73.99 25.56 37.58 52.68 47.87 21.95 19.50 9.90 7.79 16.94 12.29 9.02 4.05 12.00
$20.87 45.37 17.91 28.11 48.10 41.91 20.81 12.90 6.91 7.55 14.99 5.78 6.73 3.90 6.38
$39.99 77.46 26.65 38.00 67.55 54.60 34.85 22.50 11.90 17.80 20.99 12.97 9.43 8.43 15.14
$6,094 5,752 5,482 3,370 1,941 1,611 1,257 890 890 530 429 358 247 204 220
$506 1,419 77 573 991 316 147 20 177 73 106 76 29 23 62
$5,955 6,110 9,777 4,015 1,995 1,696 1,143 1,534 1,009 554 323 282 256 266 159
($139) 184 3,966 494 54 85 (114) 644 119 24 (106) (76) 9 62 (62) Mean Median
5
Notes: Source: Capital IQ and Wall Street Estimates. Multiples 50 considered NM. (1) Revenue multiples reflective of Net Revenue. (2) Figures reflect CY 2016 estimates.
EV / Revenue CY 17E CY 16A/E
CY 18E
CY 16A/E
EV / EBITDA CY 17E
CY 18E
Operating Metrics EBITDA Margin Revenue Growth CY 17E CY 16A/E '16A/E/'15A '17E/'16A/E '18E/'17E
5.6x 5.1 5.2 4.2 6.6 0.3 1.3 0.5 0.4 0.5 0.1 0.4 0.4 0.3
4.8x 4.7 4.0 3.3 5.0 0.3 0.9 0.5 0.4 0.5 0.1 0.3 0.5 0.4
4.2x 4.4 3.4 NA 4.0 NA 0.8 0.5 0.4 NA 0.1 0.3 NA NA
13.9x 13.1 15.1 13.6 20.6 1.3 NM 16.2 17.5 7.0 NM NM 16.8 NM
11.8x 12.7 12.2 10.7 18.6 1.4 19.3 28.0 6.3 5.3 NM 13.4 NM 21.6
10.2x 11.2 9.7 8.4 13.8 1.8 10.3 17.4 4.8 NA 3.7 4.7 NA NA
20.4% 5.5% 49.2% 36.7% 78.3% 10.9% (3.9%) (1.2%) 5.6% (7.4%) (9.4%) (4.1%) (8.0%) 6.4%
17.5% 8.0% 30.4% 27.9% 33.4% (3.8%) 34.5% 3.9% 2.6% (7.8%) (27.1%) 10.9% (11.9%) N/A
2.2x 0.5
1.8x 0.5
2.0x 0.8
13.5x 14.5
13.5x 12.5
8.7x 9.7
12.8% 5.5%
9.1% 8.0%
7.0x 1.9 2.9 2.2 2.8 1.5 2.2 2.1 2.3 8.7 2.1 1.7 2.4 1.2 0.8
5.7x 2.0 2.8 1.8 2.8 1.5 1.9 2.0 2.0 5.8 2.0 1.6 2.3 1.2 0.9
4.8x 1.8 2.6 1.6 2.7 1.4 1.6 1.9 1.8 NA 1.8 1.5 2.0 1.2 0.8
41.1x 12.2 7.9 9.6 8.7 8.1 9.6 8.5 8.8 NM 9.9 21.1 13.8 4.6 27.8
28.5x 10.6 8.9 7.7 8.4 7.7 7.5 8.1 8.0 NM 10.8 14.2 11.4 5.2 NM
20.3x 8.5 7.8 6.2 8.2 6.2 6.3 7.4 7.2 NA 8.5 11.4 8.6 5.1 31.7
31.3% (2.8%) 9.5% 15.0% 10.8% 7.1% 40.8% 34.1% 16.7% 54.6% 7.4% 16.6% (4.7%) (12.6%) (1.4%)
23.4% (1.1%) 3.5% 18.5% 1.9% 1.9% 13.1% 3.5% 16.3% 50.6% 8.1% 6.2% 4.9% (3.4%) (9.4%)
2.8x 2.2
2.4x 2.0
2.0x 1.8
13.7x 9.6
10.5x 8.4
10.2x 8.0
14.8% 10.8%
9.2% 4.9%
14.8% 6.3% 18.1% N/A 23.6% N/A 16.1% 5.6% 5.9% N/A 7.3% 13.6% N/A N/A 12.4% 13.6% 19.4% 10.7% 9.8% 14.4% 3.4% 6.2% 18.1% 4.9% 9.5% N/A 10.0% 10.6% 13.7% 0.3% 12.2% 10.2% 10.3%
40.5% 38.9% 34.4% 30.8% 32.1% 25.8% (1.3%) 3.2% 2.4% 6.8% (5.1%) (1.2%) 2.4% (1.7%)
40.6% 37.1% 32.7% 30.6% 26.7% 23.7% 4.8% 1.8% 6.6% 9.7% (7.1%) 2.4% (7.2%) 2.0%
14.9% 5.0%
14.6% 8.1%
17.1% 16.0% 36.9% 22.6% 32.7% 18.4% 23.0% 24.6% 26.4% (109.1%) 21.4% 8.3% 17.4% 25.4% 3.0%
20.0% 18.5% 31.8% 23.9% 33.0% 19.0% 25.9% 25.2% 24.8% (66.4%) 18.3% 11.6% 20.0% 23.3% (9.5%)
12.3% 21.4%
14.6% 20.0%
CY 18E 41.0% 39.8% 35.0% N/A 29.2% N/A 7.8% 2.7% 8.2% N/A 2.7% 6.1% N/A N/A 19.2% 8.2% 23.5% 20.8% 33.1% 25.9% 32.7% 22.2% 26.0% 26.3% 25.4% N/A 21.1% 13.0% 23.5% 23.9% 2.6% 22.9% 23.7%
PUBLIC COMPANY VALUATIONS Internet / Digital Media / SaaS: Financial Metrics (Cont’d) $MM, Except Per Share Data Stock Price 4/3/17 Internet Commerce Amazon.com, Inc. Alibaba Group Holding Limited The Priceline Group Inc. Netflix, Inc. eBay Inc. Expedia, Inc. QVC Group Copart, Inc. GrubHub Inc. trivago N.V. (1) Cimpress N.V. Stamps.com Inc. Shutterstock, Inc. Etsy, Inc. Quotient Technology Inc. 1-800-FLOWERS.COM, Inc. Overstock.com, Inc. Angie's List, Inc. Travelzoo Inc. CafePress Inc.
$891.51 108.09 1,773.99 146.92 33.76 126.14 19.97 60.80 33.16 12.96 86.50 116.10 41.36 10.63 9.40 10.10 17.25 6.04 9.75 2.95
Trading Statistics LTM Price Range High Low $585.25 73.30 1,148.06 84.50 22.30 96.58 17.24 39.98 21.41 10.88 79.15 68.82 36.01 7.60 9.45 7.13 13.05 5.22 7.50 2.80
$890.35 110.45 1,798.75 148.29 34.43 133.55 27.25 63.14 44.58 14.20 104.18 136.00 65.16 16.05 14.36 11.40 20.50 10.76 13.27 3.94
Equity Value $425,402 270,225 87,228 63,236 36,699 18,931 9,078 6,983 2,849 3,098 2,690 1,956 1,427 1,234 838 662 441 359 131 49
Cash & Equiv. $25,981 20,422 4,300 1,734 7,149 1,869 338 175 324 240 50 108 279 282 175 114 183 39 27 44
Enterprise Value
Net Debt
$419,834 268,980 90,097 64,866 38,510 21,782 15,214 7,520 2,525 3,069 3,717 2,010 1,148 964 663 659 315 378 104 6
($5,568) (7,341) 2,869 1,631 1,811 1,290 6,037 537 (324) (240) 985 54 (279) (270) (175) (3) (124) 19 (27) (43) Mean Median
Media Conglomerates / Selected Entertainment $113.20 The Walt Disney Company 37.56 Comcast Corporation 32.15 Twenty-First Century Fox, Inc. 33.00 Sony Corporation 68.86 CBS Corporation 45.71 Viacom, Inc. 28.93 Discovery Communications, Inc. 77.39 Scripps Networks Interactive, Inc. 37.36 Tribune Media Company
$90.32 29.81 23.33 22.88 48.88 33.94 23.66 58.73 27.75
$113.71 38.44 32.60 34.15 69.60 46.72 29.91 83.42 40.72
$178,997 178,470 59,504 41,658 28,201 18,142 17,088 10,038 3,246
$3,736 5,073 4,530 15,415 598 443 460 123 578
$199,718 238,120 76,660 42,452 36,978 30,250 24,794 13,446 6,085
$16,754 55,973 15,363 (4,638) 8,777 11,857 7,463 3,079 2,834 Mean Median
Publishers Thomson Reuters Corporation News Corporation Pearson plc UBM plc Lagardère SCA Graham Holdings Company The New York Times Company Time Inc. The E. W. Scripps Company Gannett Co., Inc.
$43.10 12.79 8.44 9.40 29.05 593.75 14.20 19.20 23.10 8.26
$37.34 10.54 6.88 7.04 19.55 440.55 10.60 12.50 12.16 7.30
$44.90 14.68 12.34 9.70 29.42 601.95 16.35 20.40 24.15 17.72
$31,195 7,443 6,879 3,698 3,723 3,320 2,289 1,905 1,899 938
$2,556 1,564 1,814 105 508 1,097 550 336 134 114
$36,838 6,507 8,443 4,485 5,189 2,743 1,982 2,809 2,157 1,224
$5,160 (1,209) 1,559 744 1,466 (589) (303) 904 259 286 Mean Median
6
Notes: Source: Capital IQ and Wall Street Estimates. Multiples 50 considered NM. (1) Reflects Expedia's 63.5% controlling equity stake.
EV / Revenue CY 17E CY 16A/E
CY 18E
CY 16A/E
EV / EBITDA CY 17E
CY 18E
Operating Metrics EBITDA Margin Revenue Growth CY 17E CY 16A/E '16A/E/'15A '17E/'16A/E '18E/'17E
CY 18E
3.1x 13.0 8.4 7.3 4.3 2.5 1.5 5.5 5.1 3.9 1.9 5.5 2.3 2.6 2.4 0.6 0.2 1.2 0.8 0.1
2.5x 9.6 7.2 5.8 4.1 2.2 1.5 5.1 3.9 2.6 1.6 4.8 2.1 2.2 2.1 0.5 0.2 1.3 0.8 0.1
2.1x 7.6 6.3 4.8 3.9 1.9 1.4 4.7 3.2 1.9 1.5 4.2 1.9 1.8 1.8 0.5 0.2 1.2 0.8 0.0
36.0x 35.2 21.7 NM 12.8 20.3 8.6 15.4 21.8 NM 25.3 14.3 18.0 28.1 NM 8.4 NM NM 7.9 3.8
21.6x 20.7 19.0 NM 10.9 11.8 7.9 13.6 14.0 NM 11.9 9.6 10.6 15.8 14.7 6.6 12.3 13.0 9.2 2.0
17.1x 16.2 16.3 34.7 10.1 9.8 7.5 12.2 11.2 29.2 10.0 8.2 8.9 10.4 10.8 6.2 11.8 10.1 7.7 1.0
27.1% 42.5% 16.5% 30.3% 4.5% 31.5% 11.5% 17.8% 36.3% 48.7% 21.6% 70.3% 16.3% 33.4% 16.0% 2.1% 8.6% (6.0%) (9.3%) (4.6%)
21.5% 35.4% 16.1% 27.2% 4.8% 14.1% 0.5% 8.2% 30.7% 46.5% 17.6% 14.6% 11.5% 21.7% 13.8% 2.8% 8.0% (7.4%) (5.0%) 3.8%
20.6% 26.1% 14.9% 19.7% 5.8% 12.9% 3.7% 8.5% 21.3% 37.6% 11.8% 15.7% 11.8% 19.8% 14.8% 5.3% 6.0% 4.6% 1.9% 6.7%
8.6% 36.9% 38.6% 5.0% 33.5% 12.2% 17.2% 35.5% 23.5% (3.6%) 7.6% 38.6% 12.9% 9.4% (2.4%) 6.6% 0.1% 1.5% 10.2% 1.4%
11.8% 46.4% 38.0% 9.6% 37.5% 18.4% 18.6% 37.2% 28.0% 3.8% 13.7% 50.1% 19.7% 13.8% 14.4% 8.2% 1.3% 9.7% 9.3% 2.6%
12.3% 47.0% 38.5% 13.9% 38.2% 19.7% 18.9% 38.2% 28.7% 6.6% 14.7% 51.0% 21.0% 17.4% 17.0% 8.3% 1.3% 12.0% 10.9% 5.1%
3.6x 2.6
3.0x 2.2
2.6x 1.9
18.5x 18.0
12.5x 12.1
12.5x 10.3
20.7% 17.1%
14.3% 14.0%
13.5% 12.3%
14.7% 9.8%
19.6% 14.1%
21.0% 17.2%
3.6x 3.0 2.7 0.7 2.6 2.4 3.8 4.0 3.1
3.4x 2.8 2.6 0.6 2.7 2.3 3.6 3.7 3.2
3.3x 2.7 2.5 0.6 2.6 2.3 3.4 3.6 3.0
11.5x 9.0 10.8 10.3 10.9 10.6 10.2 10.0 11.5
11.0x 8.6 10.5 5.4 11.5 9.7 9.8 9.2 13.2
10.3x 8.0 9.7 5.1 10.5 9.0 9.5 8.8 11.4
1.6% 7.9% 5.9% (5.8%) 13.5% (3.2%) 1.6% 12.7% 8.1%
5.0% 4.4% 4.9% 11.7% (4.9%) 3.2% 5.2% 5.9% (2.2%)
4.8% 6.5% 2.6% 5.9% 3.9% 2.4% 7.0% 4.2% 8.0%
31.5% 32.9% 25.4% 6.4% 23.5% 22.6% 37.3% 39.5% 27.3%
31.4% 33.1% 24.9% 11.0% 23.5% 23.8% 36.8% 40.7% 24.2%
32.0% 33.1% 26.2% 10.9% 24.7% 25.2% 35.8% 40.8% 26.1%
2.9x 3.0
2.8x 2.8
2.6x 2.7
10.5x 10.6
9.9x 9.8
9.1x 9.5
4.7% 5.9%
3.7% 4.9%
5.0% 4.8%
27.4% 27.3%
27.7% 24.9%
28.3% 26.2%
3.3x 0.8 1.5 4.2 0.7 NA 1.3 0.9 2.3 0.4
3.3x 0.8 1.4 3.6 0.7 NA 1.3 0.9 2.3 0.4
3.2x 0.8 1.5 3.6 0.7 NA 1.2 0.9 2.0 0.4
11.6x 7.0 8.7 14.4 7.7 NA 8.2 6.8 11.6 3.5
11.1x 7.0 9.5 11.8 7.6 NA 8.8 6.8 18.5 3.8
10.6x 6.6 9.4 11.6 7.2 NA 8.4 6.8 10.4 3.8
(0.8%) (1.6%) (14.7%) (6.2%) (3.7%) N/A (1.5%) (1.0%) 31.8% 5.6%
1.4% (1.7%) 4.2% 17.5% (2.1%) N/A 1.1% (2.5%) (2.0%) 4.4%
2.7% (2.9%) (0.9%) 0.6% 2.3% N/A 2.5% (1.0%) 15.1% (4.3%)
1.7x 1.3
1.6x 1.3
1.6x 1.2
8.8x 8.2
9.4x 8.8
8.3x 8.4
0.9% (1.5%)
2.3% 1.1%
1.6% 0.6%
28.4% 11.4% 17.2% 29.2% 8.6% N/A 15.5% 13.5% 19.7% 11.5% 17.2% 15.5%
29.4% 11.6% 15.2% 30.3% 8.9% N/A 14.4% 13.8% 12.6% 10.3% 16.3% 13.8%
29.9% 12.7% 15.5% 30.7% 9.2% N/A 14.6% 14.0% 19.5% 10.7% 17.4% 14.6%
PUBLIC COMPANY VALUATIONS Internet / Digital Media / SaaS: Financial Metrics (Cont’d) $MM, Except Per Share Data Stock Price 4/3/17 Diversified Marketing WPP plc Experian plc Equifax Inc. Nielsen Holdings plc Alliance Data Systems Corporation The Interpublic Group of Companies, Inc. Havas SA Acxiom Corporation MDC Partners Inc. Harte Hanks, Inc. (1)
$21.60 20.20 136.10 41.87 250.33 24.39 8.91 28.21 9.30 1.40
Trading Statistics LTM Price Range Low High $15.01 15.21 110.87 40.28 185.02 21.67 6.93 19.11 2.75 0.85
$24.04 20.64 137.76 55.94 251.19 25.33 9.43 30.40 23.90 2.85
Equity Value $27,622 18,793 16,431 14,970 14,000 9,578 3,739 2,206 514 86
Cash & Equiv. $3,009 166 129 754 1,859 1,101 0 138 28 7
Net Debt
Enterprise Value
$5,100 3,161 2,543 7,177 19,090 590 (157) 99 909 54
$33,269 21,968 19,033 22,338 33,089 10,460 3,582 2,305 1,549 141 Mean Median
Gaming Tencent Holdings Limited NetEase, Inc. Activision Blizzard, Inc. Electronic Arts Inc. Naver Corporation Gamesa Corporación Tecnológica, S.A. NCsoft Corporation Ubisoft Entertainment SA DeNA Co., Ltd. Zynga Inc. GungHo Online Entertainment, Inc. Changyou.com Limited Gree, Inc. Glu Mobile Inc.
$28.98 285.22 49.53 89.11 781.37 23.93 276.57 42.44 20.43 2.83 2.24 27.79 6.32 2.26
$19.59 130.82 33.03 61.10 558.50 15.98 190.64 26.31 15.95 2.19 2.04 17.43 4.16 1.73
$29.62 308.66 50.40 91.82 808.22 24.01 291.78 42.88 35.62 3.08 3.12 31.47 6.75 3.09
$271,886 37,500 37,239 27,469 22,509 6,626 5,874 4,756 2,965 2,457 1,595 1,418 1,485 304
$17,603 5,240 3,245 4,219 2,785 1,400 817 1,028 709 852 301 831 704 102
($1,833) (4,690) 1,642 (3,229) (2,471) (821) (693) (42) (709) (852) (292) (452) (704) (102)
$271,727 32,849 38,881 24,240 20,482 5,805 5,190 4,713 2,319 1,605 1,318 996 781 202 Mean Median
Social Media & New Platform Facebook, Inc. Snap Inc. Twitter, Inc. LINE Corporation Pandora Media, Inc. Yelp Inc.
$142.28 22.35 14.84 39.31 11.75 32.63
$106.31 18.90 13.73 31.43 8.05 19.22
$142.95 29.44 26.20 47.10 14.98 43.41
$411,187 25,864 10,711 8,600 2,765 2,597
$29,449 987 3,775 1,203 237 480
($29,449) (972) (2,088) (1,015) 105 (480)
$381,738 24,892 8,623 7,586 2,870 2,118 Mean Median
7
Notes: Source: Capital IQ and Wall Street Estimates. Multiples 50 considered NM. (1) Figures reflect CY 2016 estimates.
EV / Revenue CY 16A/E CY 17E
CY 18E
CY 16A/E
EV / EBITDA CY 17E
CY 18E
Operating Metrics Revenue Growth EBITDA Margin '16A/E/'15A '17E/'16A/E '18E/'17E CY 16A/E CY 17E
CY 18E
1.9x 4.8 6.1 3.5 4.6 1.3 1.5 2.6 1.1 0.3
1.7x 4.6 5.6 3.4 4.3 1.3 1.4 2.5 1.1 0.4
1.6x 4.3 5.2 3.2 3.9 1.3 1.4 2.2 1.0 NA
11.1x 14.2 16.9 11.5 15.8 9.5 9.1 13.9 8.8 NM
10.1x 13.3 15.2 11.0 15.5 8.9 8.5 12.7 7.6 8.9
9.6x 12.5 14.0 10.4 13.7 8.4 8.2 10.8 6.6 NA
(1.5%) (2.3%) 18.1% 2.2% 10.8% 3.1% 1.1% 5.9% 4.5% (18.9%)
9.4% 4.8% 8.2% 4.5% 8.3% 2.0% 6.0% 4.3% 6.4% (1.0%)
4.4% 6.5% 7.2% 4.3% 10.8% 4.2% 3.4% 11.9% 4.8% N/A
16.8% 34.1% 35.8% 30.7% 29.4% 14.0% 16.3% 18.8% 12.8% (0.6%)
17.0% 34.7% 36.8% 30.8% 27.5% 14.7% 16.6% 19.7% 13.8% 4.0%
2.8x 2.2
2.6x 2.1
2.7x 2.2
12.3x 11.5
11.2x 10.5
10.5x 10.4
2.3% 2.6%
5.3% 5.4%
6.4% 4.8%
20.8% 17.8%
21.6% 18.4%
24.0% 20.8%
12.4x 5.9 5.9 5.1 6.1 1.2 6.4 3.1 1.9 2.2 1.4 1.9 1.5 1.0
8.9x 4.4 6.0 4.7 4.9 1.0 4.6 2.2 1.8 2.0 1.5 1.7 1.4 0.9
7.0x 3.7 5.5 4.4 4.4 1.0 4.0 2.3 1.8 1.8 1.7 1.6 1.4 0.8
28.2x 17.4 15.8 15.0 19.5 9.1 17.3 6.4 7.8 25.9 3.2 6.3 7.8 NM
22.9x 13.6 16.3 13.9 14.7 7.2 11.5 5.6 5.8 17.6 3.8 5.2 10.1 NM
17.9x 11.7 13.6 12.3 12.7 6.4 9.7 4.7 5.1 12.9 4.6 5.1 10.5 NM
38.1% 58.3% 41.5% 11.7% 20.8% 27.9% 14.7% 8.2% 2.1% (3.0%) (25.0%) (31.0%) (19.7%) (19.7%)
38.8% 35.6% (2.6%) 8.0% 24.2% 15.1% 38.2% 40.0% 4.4% 8.8% (11.3%) 11.5% 1.9% 9.0%
28.3% 19.4% 10.2% 7.1% 13.1% 1.2% 15.0% (2.6%) 1.5% 9.0% (10.4%) 5.1% 0.3% 9.5%
44.0% 33.9% 37.2% 33.8% 31.4% 13.1% 36.7% 48.4% 24.2% 8.4% 43.2% 29.9% 18.8% (19.5%)
39.0% 31.9% 37.2% 33.9% 33.6% 14.4% 40.1% 39.3% 30.9% 11.3% 40.2% 32.4% 14.2% (8.6%)
39.0% 31.2% 40.3% 35.7% 34.3% 15.9% 41.3% 48.3% 34.9% 14.2% 37.1% 31.5% 13.5% (2.8%)
4.0x 2.6
3.3x 2.1
3.0x 2.1
13.8x 15.0
11.4x 11.5
9.8x 10.5
8.9% 9.9%
15.8% 10.3%
7.6% 8.0%
27.4% 32.6%
27.8% 33.0%
29.6% 34.6%
13.8x NA 3.4 6.3 2.1 3.0
10.1x 24.1 3.7 4.9 1.8 2.4
7.9x 12.2 3.4 4.3 1.4 2.0
21.1x NA 11.5 35.4 NM 17.6
16.1x NM 14.5 22.5 NM 13.2
12.7x NM 12.4 16.9 34.9 9.8
54.2% N/A 14.0% 20.3% 19.0% 29.7%
37.0% N/A (6.6%) 27.3% 17.1% 24.8%
27.3% 97.1% 7.3% 16.0% 26.7% 20.2%
65.4% N/A 29.7% 17.8% (8.6%) 16.8%
62.6% (62.7%) 25.1% 22.0% (2.5%) 18.1%
62.6% (21.4%) 27.4% 25.2% 4.0% 20.2%
5.7x 3.4
7.8x 4.3
5.2x 3.8
21.4x 19.4
16.6x 15.3
17.3x 12.7
24.2% 17.8%
10.4% 20.0%
19.7% 22.7%
27.4% 20.3%
19.9% 24.8%
32.4% 23.5%
17.1% 34.7% 37.4% 31.1% 28.1% 15.0% 16.7% 20.8% 15.1% N/A
PUBLIC COMPANY VALUATIONS Internet / Digital Media / SaaS: Financial Metrics (Cont’d) $MM, Except Per Share Data Stock Price 4/3/17 SaaS Salesforce.com, inc. Workday, Inc. ServiceNow, Inc. Shopify Inc. The Ultimate Software Group, Inc. RealPage, Inc. Nutanix, Inc. Zendesk, Inc. HubSpot, Inc. Cornerstone OnDemand, Inc. Box, Inc. RingCentral, Inc. Coupa Software Incorporated MINDBODY, Inc. Everbridge, Inc. Apptio, Inc. LivePerson, Inc. Xactly Corporation Bazaarvoice, Inc. Jive Software, Inc. Brightcove Inc. ChannelAdvisor Corporation Marin Software Incorporated
$82.31 82.32 86.22 69.23 195.09 34.75 18.15 27.74 61.35 38.59 16.56 27.75 25.07 27.65 19.47 11.36 6.70 11.80 4.40 4.35 8.55 10.90 1.80
Trading Statistics LTM Price Range Low High $66.43 65.79 61.43 24.96 180.29 19.54 18.20 11.06 39.01 30.31 9.86 15.85 22.50 11.91 11.76 11.22 5.43 6.63 3.03 3.50 5.83 10.20 1.45
$84.48 93.35 94.72 73.00 224.07 37.40 46.78 31.88 66.10 47.75 18.36 28.45 41.61 28.25 21.25 24.60 8.85 16.10 6.14 4.59 13.80 15.91 3.29
Equity Value $58,234 16,711 14,485 6,245 5,786 2,813 2,599 2,730 2,218 2,186 2,145 2,068 1,266 1,130 530 436 391 372 364 344 291 286 71
Cash & Equiv. $2,209 1,997 899 395 89 105 355 225 114 302 177 160 202 86 61 79 51 42 83 109 37 65 34
Net Debt
Enterprise Value
$501 (1,462) (392) (395) (80) 17 (355) (225) (113) (64) (102) (145) (202) (70) (61) (79) (51) (28) (46) (109) (36) (62) (31)
$58,735 15,249 14,093 5,850 5,706 2,831 2,244 2,505 2,105 2,123 2,043 1,923 1,064 1,059 470 357 340 344 318 236 255 224 40 Mean Median
8
Notes: Source: Capital IQ and Wall Street Estimates. Multiples 50 considered NM.
EV / Revenue CY 16A/E CY 17E
CY 18E
CY 16A/E
EV / EBITDA CY 17E
CY 18E
Operating Metrics Revenue Growth EBITDA Margin '16A/E/'15A '17E/'16A/E '18E/'17E CY 16A/E CY 17E
7.0x 9.7 10.1 15.0 7.3 5.0 3.7 8.0 7.8 5.0 5.1 5.1 8.0 7.6 6.1 2.2 1.5 3.6 1.6 1.2 1.7 2.0 0.4
5.8x 7.5 7.7 9.8 5.9 4.2 2.6 6.0 6.0 4.4 4.1 4.0 6.3 5.9 4.7 2.0 1.7 3.1 1.5 1.2 1.6 1.8 0.5
4.8x 6.0 6.0 7.1 4.8 3.7 1.9 4.6 4.8 3.8 3.3 3.2 5.1 4.7 3.7 1.7 1.6 2.5 1.5 1.1 1.4 1.6 NA
33.7x NM NM NM 30.9 22.3 NM NM NM NM NM NM NM NM NM NM 17.7 NM 21.7 12.7 44.8 30.2 16.8
27.0x NM 35.3 NM 24.4 17.2 NM NM NM 40.9 NM NM NM NM NM NM 18.2 NM 19.0 10.7 29.5 33.7 NM
21.6x 39.8 24.5 NM 19.6 14.1 NM NM NM 24.2 NM 43.6 NM NM NM NM 20.1 NM 12.9 9.5 20.8 22.7 NA
25.9% 35.0% 38.3% 89.7% 26.4% 21.1% 83.4% 49.4% 48.9% 24.6% 31.7% 28.2% 59.9% 37.1% 30.9% 24.2% (6.8%) 25.6% 2.2% 4.2% 11.6% 12.5% (8.0%)
21.3% 28.9% 32.2% 53.9% 24.0% 19.0% 41.9% 34.6% 30.0% 13.7% 26.1% 27.4% 26.1% 30.0% 31.0% 12.0% (8.1%) 17.6% 2.1% (0.1%) 9.1% 9.0% (11.9%)
5.4x 5.1
4.3x 4.2
3.6x 3.7
25.6x 22.3
25.6x 25.7
22.8x 21.2
30.3% 26.4%
20.4% 24.0%
19.4% 25.1% 28.4% 36.6% 21.4% 12.2% 36.7% 29.7% 25.6% 15.9% 22.7% 24.1% 23.7% 25.5% 26.2% 15.6% 5.4% 20.7% 6.1% 3.0% 9.2% 11.0% N/A 20.2% 22.1%
CY 18E
20.8% 9.2% 17.9% 0.5% 23.6% 22.4% (47.8%) 2.1% (0.3%) 7.3% (7.6%) 5.5% (23.1%) (3.5%) 0.0% (7.3%) 8.6% (4.2%) 7.3% 9.1% 3.8% 6.6% 2.4%
21.3% 13.4% 21.7% 0.1% 24.2% 24.3% (19.1%) 2.9% 1.1% 10.8% (8.1%) 6.2% (13.2%) 3.4% (2.2%) (5.6%) 9.1% (3.9%) 8.1% 10.8% 5.3% 5.4% (7.2%)
22.4% 15.1% 24.4% 4.9% 24.7% 26.5% (6.1%) 5.0% 4.6% 15.7% (1.4%) 7.4% (8.9%) 8.6% 1.2% 2.7% 7.8% 1.6% 11.3% 11.8% 6.9% 7.2% N/A
2.3% 3.8%
4.7% 5.3%
8.8% 7.3%
PUBLIC SAAS COMPANIES Valuation Correlation to Growth and Cash Flow Selected Public Saas Companies Company
Identifier
14.0x
APPF
R = 0.84
APTI BCOV
12.0x
BOX
COUP CRM CSOD ECOM EVBG HUBS JIVE LPSN MB MRIN NOW NTNX RNG RP
Enterprise Value / CY 2017E Revenue
BV
SHOP
10.0x
WDAY
8.0x
NOW COUP 6.0x
APPF HUBS MB
CSOD
4.0x
XTLY
2.0x
LPSN
SHOP ULTI
CRM
ZEN
EVGB BOX RNG
APTI
ULTI
RP
NTNX
ECOM
JIVE
BV
BCOV
MRIN
WDAY
(20%)
(10%)
0%
10%
20%
30%
40%
50%
XTLY ZEN
CY 2017E Revenue Growth % + CY 2017E FCF Margin % 9
Notes: Source: Capital IQ and Wall Street Estimates. When analyzing the same data set, R value of 2017E Revenue Multiple and 2017E Revenue Growth % is 0.81.
60%
70%
RECENT ACQUISITIONS Internet / Digital Media / SaaS ($MM) Announced Date
Acquirer
Target
4/3/2017
Enterprise Value
EV / LTM Sales
EV / LTM EBITDA
EV / NTM Sales
EV / NTM EBITDA
$300
NA
NA
NA
NA
(Information Solutions) (1)
3/21/2017
$308
1.5x
NA
NA
NA
3/13/2017
$170
NA
NA
NA
NA
$100
NA
NA
NA
NA
3/7/2017 (Network Security Solutions Business)
(1)
3/6/2017
$60
1.4x
NA
NA
NA
3/6/2017
$614
NA
NA
NA
NA
2/28/2017
$174
0.3x
3.2x
NA
NA
2/28/2017
$105
NA
NA
NA
NA
2/22/2017
$325
5.4x
NA
NA
NA
2/23/2017
$170
2.4x
33.6x
2.3x
19.7x
2/22/2017
$310
2.8x
NA
NA
NA
2/15/2017
$102
1.3x
NA
NA
NA
2/10/2017
$4,300
NA
10.9x
NA
NA
(2)
(2) (3) (4)
(2) (5)
(2)
(2) (HR and Benefits BPO business)
10
Notes: Multiples 50x considered NM. Disclosed transactions with Enterprise Value
