Software Sector Summary Report - GCA Savvian [PDF]

Software C O M P Sector A N Y PSummary RESENTATION Week of May 8, 2017

1

DEAL DASHBOARD Software $18.1 Billion

208

$13.5 Billion

34

Financing Volume YTD (1)(2)

Financing Transactions YTD (1)(2)

M&A Volume YTD (3)

M&A Transactions YTD (3)

Quarterly M&A Volume (3)

Select LTM M&A Transactions (4)

Select Financing Transactions Company

Quarterly Financing Volume (1)(2) $Bn

Amount ($MM)

$Bn

37%

$190.0

$9

$180.0

$3

$4

$6

98%

$14

Acquirer

EV ($Bn)

$41

$10

$6

Target

$50

$5

$26.2

$24

$6

$15

$14

$8.7

$15 $12

$7

$5

$140.0

$8.7

$134.0

Q1'15 Q2'15 Q3'15 Q4'15 Q1'16 Q2'16 Q3'16 Q4'16 Q1'17

Q1'15 Q2'15 Q3'15 Q4'15 Q1'16 Q2'16 Q3'16 Q4'16 Q1'17

Quarterly Financing Deal Count (1)(2)

Quarterly M&A Deal Count (3)

$6.1

33%

20%

$128.4

$3.9

156

118

$106.8 72

86

127 103 111

123 94

7

$34.5

Q1'15 Q2'15 Q3'15 Q4'15 Q1'16 Q2'16Q3'16 Q4'16 Q1'17

29

27

24

$70.0

24

27

(

SPX

5.0x

25%

4.0x

17%

15%

Strategic Buyers

PE Buyers

5.3x

4.7x 3.9x

4.2x

3.9x

4.0x

3.9x

3.5x

3.1x

4.6x

4.9x 4.1x

3.6x

3.0x

2.9x

2.7x

3.0x

4.4x

2.2x

2.0x

2.4x 1.7x

2.0x

10%

1.0x

5% 0% May-16 Jun-16 (5%)

`

6.0x

30%

20%

$2.4

M&A EV/ NTM Rev. Over Time (6) 35%

35%

$2.8

)

Q1'15 Q2'15 Q3'15 Q4'15 Q1'16 Q2'16 Q3'16 Q4'16 Q1'17

All Buyers

IGV

$3.3

25

15

13

Last 12 Months Software Price Performance vs. S&P 500 (5) 40%

(Software Business Division)

Jul-16

Aug-16

Sep-16

Oct-16

Nov-16 Dec-16

Jan-17

Feb-17 Mar-17 Apr-17 May-17

0.0x 2011

2012

2013

Notes: Source: Capital IQ, PitchBook, and Dow Jones VentureSource. Market Data as of 05/05/2017. 1) Criteria based on software series A and subsequent rounds of global financings greater than or equal to $20MM. 2) Financings include Software Venture and Private Equity Growth / Expansion activity. 3) Criteria based on global target software M&A deals with transaction enterprise values greater than $50MM. 4) Select Software M&A transactions reflect notable transactions in CY2016 and CY2017 YTD. 5) iShares North American Tech-Software ETF (IGV), used as proxy for software landscape. Top holdings in the ETF include ADBE, MSFT, ORCL, CRM, and INTU. 6) Criteria based on global public target software M&A deals with enterprise transaction values greater than $100MM.

2014

2015

2016

2017

2

GCA OVERVIEW Software Team

New York

San Francisco

th

25th Fl.

One Maritime Plaza, San Francisco, CA 94111 United States Phone: (415) 318-3600

640 Fifth Avenue, 10 Fl. New York, NY 10019 United States Phone: (212) 999-7090

Frankfurt

London

Tokyo

Thurn-und-Taxis-Platz 6 60313 Frankfurt Germany Phone: +49 69 204 34 6410

1 Southampton St. London WC2R0LR United Kingdom Phone:+44 20 7484 4040

11-1 Marunouchi 1-chome Chiyoda-ku, Tokyo 100-6230 Japan Phone: +81 (3) 6212-7100

Todd Carter

Clark Callander

Steve Fletcher

Paul DiNardo

Sascha Pfeiffer*

Akikazu Ida**

Co-President and CEO

Co-Head of Investment Banking

Head of Software

Managing Director

Managing Director

Managing Director

Phone: (415) 318-3610 Mobile: (415) 314-9898 [email protected]




Phone: +49 (69) 204-346 415 Mobile: +49 (0) 177-74-15643 [email protected]

Phone: +81 (3) 6212-7241 Mobile: +81 (80) 9027-3023 [email protected]

Daniel Avrutsky

Chris Gough

James Orozco

Joshua Wepman

Adrian Reed*

Managing Director

Managing Director

Managing Director

Managing Director

Managing Director





Phone: +44 845 505 4314 Mobile: +44 7887 626 800 [email protected]

Glen Kruger

Raiko Stelten*

Gautam Garg

Mike Janovec

Saif Malik***

Director

Director

Vice President

Vice President

Vice President


Phone: +49 (69) 204 34 6418 Mobile: +49 171 335 0879 [email protected]



Phone: +44 (0) 20 7484-4106 Mobile: +44 (0) 77 8606-8553 [email protected]

Notes: * Adrian Reed, Managing Director; Sascha Pfeiffer, Managing Director and Raiko Stelten, Director respresent GCA Altium AG, a wholly-owned subsidiary of GCA Corporation. ** Akikazu Ida is a Managing Director at GCA Corporation. *** Saif Malik is Vice President at GCA Savvian Europe Ltd.

3

RECENT STOCK PERFORMANCE Index Performance Last 12 Months

Last 3 Years

35%

60%

30%

50%

25%

40%

20%

30%

15%

20%

10%

10% 0% May-14 Aug-14 (10%)

5% 0% May-16 Jun-16 (5%)

Jul-16

Aug-16 Sep-16 Oct-16 Nov-16 Dec-16 Jan-17 Feb-17 Mar-17 Apr-17 May-17

Nov-14

Feb-15 May-15 Aug-15

Nov-15

Feb-16 May-16 Aug-16

Nov-16

Feb-17 May-17

(20%) (30%)

(10%)

Sector Platform Infrastructure Security SaaS / On Demand BI & Analytics Vertical

3 Months

1 Year

3 Years

10% 6% 4% 13% 8% 16%

29% 33% 29% 35% 24% 22%

47% 23% 47% 62% 8% 43%

Notes: Source: Capital IQ. Market Data as of 05/05/2017. BI & Analytics: ATTU, AYX, DATA, DWCH, FICO, GSUM, HDP, MSTR, SPLK, TDC, VRNT. Infrastructure: ATEN, CA, CTXS, CVLT, FFIV, LOGM, MCRO, MULE, NEWR, NOW, NTCT, NTNX, PRGS, PSTG, RHT, SOW, SPLK, TEAM, VMW. Platform: GOOGL, IBM, MSFT, ORCL, RHT, SAP. SaaS / On Demand: AMBR, APTI, AYX, AZPN, BCOV, BLKB, BNFT, BOX, BV, CALD, CARB, COUP, COVS, CRM, CSLT, CSOD, ECOM, FIVN, HUBS, INST, JCOM, LOGM, LPSN, MIME, MRIN, MULE, NEWR, NOW, OKTA, PAYC, PCTY, PCYG, QLYS, RNG, RP, SHOP, SPSC, TWOU, ULTI, VEEV, WDAY, WK, YEXT, ZEN. Security: ABT, CHKP, CUDA, CYBR, FEYE, FSC1V, FTNT, GUID, IMPV, IPAS, MIME, MOBL, PANW, PFPT, QLYS, RPD, SCWX, SPLK, SYMC, Trend Micro, VDSI, ZIXI. Vertical: APPF, ATHN, BLKB, CERN, CLGX, CSLT, CSU, ELLI, EXA, GWRE, HSTM, INOV, INST, MDRX, MDSO, RP, SSNC, SSNI, VEEV, WBMD.

4

TRADING COMPARABLES Valuation and Operational Metrics EV / 2017E Revenue

EV / 2017E EBITDA 40.0x

7.0x 6.0x

5.6x

Median: 4.6x

5.0x

5.0x

4.6x

33.9x

32.6x

4.0x

3.7x

Median: 26.0x

28.6x

30.0x

4.6x

4.0x

35.0x

23.4x

25.0x

21.3x

20.0x 3.0x

13.6x

15.0x

2.0x

10.0x

1.0x

5.0x 0.0x

0.0x SaaS / On Demand

Infrastructure

Platform

Vertical

Security

SaaS / On Demand

BI & Analytics

BI & Analytics

2017E / 2016A Rev. Growth

Vertical

Infrastructure

Platform

2017E EBITDA Margin 40%

30% 25%

Security

Median: 16%

22%

20%

35%

35% Median: 22% 29%

30% 17%

16%

15%

23%

25%

14%

20%

20%

15% 10% 10%

17%

16%

SaaS / On Demand

BI & Analytics

15% 10%

5%

5%

0%

0% SaaS / On Demand

BI & Analytics Infrastructure

Security

Vertical

Platform

Platform

Infrastructure

Vertical

Notes: Source: Capital IQ. Market Data as of 05/05/2017. Figures represent mean values of respective comp groups. BI & Analytics: ATTU, AYX, DATA, DWCH, FICO, GSUM, HDP, MSTR, SPLK, TDC, VRNT. Infrastructure: ATEN, CA, CTXS, CVLT, FFIV, LOGM, MCRO, MULE, NEWR, NOW, NTCT, NTNX, PRGS, PSTG, RHT, SOW, SPLK, TEAM, VMW. Platform: GOOGL, IBM, MSFT, ORCL, RHT, SAP. SaaS / On Demand: AMBR, APTI, AYX, AZPN, BCOV, BLKB, BNFT, BOX, BV, CALD, CARB, COUP, COVS, CRM, CSLT, CSOD, ECOM, FIVN, HUBS, INST, JCOM, LOGM, LPSN, MIME, MRIN, MULE, NEWR, NOW, OKTA, PAYC, PCTY, PCYG, QLYS, RNG, RP, SHOP, SPSC, TWOU, ULTI, VEEV, WDAY, WK, YEXT, ZEN. Security: ABT, CHKP, CUDA, CYBR, FEYE, FSC1V, FTNT, GUID, IMPV, IPAS, MIME, MOBL, PANW, PFPT, QLYS, RPD, SCWX, SPLK, SYMC, Trend Micro, VDSI, ZIXI. Vertical: APPF, ATHN, BLKB, CERN, CLGX, CSLT, CSU, ELLI, EXA, GWRE, HSTM, INOV, INST, MDRX, MDSO, RP, SSNC, SSNI, VEEV, WBMD.

Security

5

PUBLIC COMPANY VALUATIONS Software Trading Statistics $MM, Except Per Share Data Stock

Platform Alphabet Inc. Microsoft Corporation Oracle Corporation International Business Machines Corporation SAP SE Red Hat, Inc.

Trading Statistics

Price

Equity

Net

Aggregate

5/5/2017

Value

Debt

Value

$950.28 $69.00 $45.58 $155.05 $103.42 $88.61

$657,355 532,716 187,547 145,669 123,958 15,753

($88,502) (35,581) (5,385) 32,091 799 (715)

$568,853 497,135 182,162 177,760 124,757 15,038 Mean Median

Infrastructure VMware, Inc. ServiceNow, Inc. Red Hat, Inc. CA, Inc. Citrix Systems, Inc. Splunk Inc. Atlassian Corporation Plc F5 Networks, Inc. Micro Focus International plc LogMeIn, Inc. Software Aktiengesellschaft NetScout Systems, Inc. MuleSoft, Inc. Commvault Systems, Inc. Pure Storage, Inc. Nutanix, Inc. New Relic, Inc. Progress Software Corporation A10 Networks, Inc.

$93.97 $98.07 $88.61 $32.69 $87.48 $66.94 $36.81 $128.57 $34.34 $120.95 $46.46 $34.40 $22.15 $56.45 $11.36 $16.29 $41.40 $30.02 $8.15

$38,218 16,660 15,753 13,664 13,225 9,260 8,300 8,243 7,887 6,365 3,550 3,157 2,791 2,537 2,347 2,333 2,185 1,443 565

($6,485) (459) (715) (739) 43 (997) (504) (1,015) 1,613 (266) (101) (143) (340) (450) (547) (355) (196) (134) (116)

$31,733 16,201 15,038 12,925 13,269 8,263 7,796 7,228 9,499 6,099 3,449 3,015 2,451 2,087 1,800 1,978 1,990 1,309 449 Mean Median

Notes: Source: Capital IQ and Wall Street Estimates. Multiples 100 considered NM. Negative margins considered NM. Market Data as of 05/05/2017.

AV / Revenue CY 17E

AV / EBITDA

CY 18E

CY 17E

CY 18E

Operating Metrics Price / EPS CY 17E

CY Rev. Growth

CY 18E

17E/16A

18E/17E

EBITDA Margin CY 17E

CY 18E

5.3x 5.0 4.8 2.3 4.7 5.7

4.6x 4.7 4.6 2.3 4.4 5.0

13.0x 12.8 10.8 9.6 13.8 21.5

11.1x 11.7 10.1 9.5 12.8 18.0

22.6x 22.2 16.7 11.3 22.2 35.7

19.2x 19.7 15.4 11.1 20.3 29.9

18.8% 16.7% 2.2% (2.0%) 13.1% 14.0%

16.2% 6.6% 3.2% (0.1%) 6.5% 13.3%

40.7% 38.7% 44.5% 23.7% 34.4% 26.3%

41.2% 39.9% 45.8% 24.0% 34.9% 27.8%

4.6x 4.9

4.3x 4.6

13.6x 12.9

12.2x 11.4

21.8x 22.2

19.3x 19.5

10.5% 13.6%

7.6% 6.6%

34.7% 36.6%

35.6% 37.4%

4.2x 8.6 5.7 3.2 4.7 6.9 11.0 3.4 6.8 6.1 3.5 2.6 9.2 3.1 1.8 2.3 6.2 3.3 1.7

4.0x 6.7 5.0 3.2 4.5 5.5 8.5 3.2 6.7 5.2 3.4 2.4 6.8 2.8 1.4 1.7 4.9 3.3 1.6

12.0x 39.5 21.5 8.3 13.6 61.1 46.0 8.6 13.1 17.5 10.7 10.4 NM 22.4 NM NM NM 9.2 25.0

11.1x 27.1 18.0 7.9 12.7 42.5 35.6 8.0 14.2 13.8 10.7 8.3 NM 17.1 21.0 NM 66.0 9.2 15.9

19.3x 84.4 35.7 13.9 18.9 NM 94.0 15.4 19.1 31.2 16.9 18.8 NM 52.9 NM NM NM 18.0 66.5

17.8x 57.6 29.9 12.8 17.2 75.0 65.1 13.9 17.6 24.5 16.0 15.0 NM 40.9 NM NM NM 17.9 36.8

6.7% 35.0% 14.0% (0.4%) (17.3%) 25.6% 33.5% 5.8% NA 5.6% 8.0% 2.3% 41.7% 7.0% 36.2% 42.4% 33.1% (3.2%) 12.6%

5.9% 29.3% 13.3% 0.7% 4.1% 26.2% 28.8% 6.2% 1.3% 15.7% 2.8% 9.0% 36.0% 10.2% 31.2% 36.2% 25.8% 0.9% 11.5%

34.8% 21.9% 26.3% 38.8% 34.4% 11.3% 23.9% 39.3% 51.7% 34.7% 32.5% 25.1% NM 13.7% NM NM NM 36.4% 6.9%

35.7% 24.6% 27.8% 40.2% 35.5% 12.9% 24.0% 39.8% 47.2% 37.8% 31.6% 28.9% NM 16.2% 6.6% NM 7.4% 36.0% 9.8%

5.0x 4.2

4.2x 4.0

21.3x 13.6

20.0x 14.2

36.1x 19.2

30.6x 17.9

16.0% 10.3%

15.5% 11.5%

28.8% 32.5%

27.2% 28.9%

6


Security Software Symantec Corporation Check Point Software Technologies Ltd. Palo Alto Networks, Inc. Splunk Inc. Fortinet, Inc. Trend Micro Incorporated Proofpoint, Inc. FireEye, Inc. CyberArk Software Ltd. Imperva, Inc. Qualys, Inc. Mimecast Limited Barracuda Networks, Inc. Rapid7, Inc. SecureWorks Corp. F-Secure Oyj VASCO Data Security International, Inc. MobileIron, Inc. Zix Corporation Absolute Software Corporation Guidance Software, Inc. iPass Inc.

Trading Statistics

Price

Equity

Net

Aggregate

5/5/2017

Value

Debt

Value

$32.30 $106.00 $116.31 $66.94 $40.08 $44.03 $81.97 $14.82 $54.21 $47.25 $41.00 $23.89 $21.09 $17.24 $8.99 $3.95 $14.55 $4.75 $5.51 $5.85 $6.12 $1.22

$19,988 17,325 10,705 9,260 7,044 6,043 3,584 2,643 1,866 1,581 1,518 1,317 1,113 739 724 617 581 438 300 232 200 80

$1,563 (1,468) (842) (997) (1,199) (1,153) (41) (124) (275) (313) (245) (100) (196) (72) (117) (103) (146) (91) (23) (35) (18) (13)

$21,551 15,857 9,863 8,263 5,846 4,889 3,543 2,520 1,591 1,268 1,274 1,217 917 667 608 513 435 347 276 197 182 67 Mean Median


AV / Revenue CY 17E

AV / EBITDA

CY 18E

CY 17E

CY 18E


CY Rev. Growth

CY 18E

17E/16A

18E/17E


CY 18E

4.2x 8.5 5.2 6.9 3.9 3.7 7.1 3.4 5.9 3.9 5.6 5.7 2.5 3.4 1.3 2.7 2.3 1.9 4.2 2.0 1.6 1.0

4.0x 7.9 4.2 5.5 3.4 3.6 5.5 3.1 4.9 3.3 4.8 4.9 2.3 2.8 1.2 2.5 2.1 1.7 3.7 1.8 1.5 0.8

9.3x 15.7 22.7 61.1 19.3 11.5 60.4 39.1 24.6 38.7 17.7 75.0 13.3 NM NM 27.7 27.0 NM 15.4 21.1 14.8 NM

8.5x 14.6 17.2 42.5 15.6 10.8 39.7 28.7 19.2 27.9 14.6 59.9 10.9 NM NM 16.3 16.4 NM 13.1 14.0 11.8 17.7

20.5x 20.5 42.5 NM 44.0 26.7 NM NM 43.8 NM 48.4 NM 27.9 NM NM 56.8 44.1 NM 19.7 92.6 19.5 NM

16.8x 18.8 32.4 75.0 35.9 24.3 86.2 NM 34.7 74.3 40.0 NM 24.8 NM NM 31.8 37.3 NM 16.5 34.1 15.6 40.7

34.5% 7.8% 21.3% 25.6% 16.9% 15.6% 33.0% 2.6% 24.1% 21.5% 14.5% 25.4% 6.2% 24.3% 7.5% 12.3% (3.2%) 11.6% 10.4% 10.0% 4.3% 10.4%

6.0% 6.8% 22.3% 26.2% 14.8% 4.8% 27.9% 10.4% 21.0% 18.1% 16.4% 16.7% 10.1% 21.3% 10.7% 9.5% 12.0% 12.0% 11.0% 10.8% 7.2% 21.7%

45.6% 53.8% 22.8% 11.3% 20.3% 32.5% 11.8% 8.8% 24.1% 10.2% 31.8% 7.6% 18.7% NM NM 9.9% 8.6% NM 26.9% 9.6% 10.7% NM

47.0% 54.1% 24.7% 12.9% 22.0% 33.0% 14.0% 10.8% 25.5% 12.0% 33.1% 8.1% 20.8% NM 0.9% 15.3% 12.7% NM 28.6% 13.1% 12.5% 4.4%

4.0x 3.8

3.4x 3.4

28.6x 21.9

21.0x 16.3

39.0x 42.5

37.6x 34.1

15.3% 13.4%

14.4% 12.0%

20.3% 15.2%

20.3% 14.7%

7


SaaS / On Demand Salesforce.com, inc. Workday, Inc. ServiceNow, Inc. Shopify Inc. Veeva Systems Inc. The Ultimate Software Group, Inc. LogMeIn, Inc. Aspen Technology, Inc. j2 Global, Inc. Paycom Software, Inc. Blackbaud, Inc. RealPage, Inc. MuleSoft, Inc. Zendesk, Inc. HubSpot, Inc. RingCentral, Inc. Box, Inc. Okta, Inc. Paylocity Holding Corporation Cornerstone OnDemand, Inc. New Relic, Inc. 2U, Inc. Qualys, Inc. Coupa Software Incorporated Callidus Software Inc. Mimecast Limited Yext, Inc. Five9, Inc. Alteryx, Inc.

Trading Statistics

Price

Equity

Net

Aggregate

5/5/2017

Value

Debt

Value

$86.97 $91.86 $98.07 $85.53 $54.39 $214.38 $120.95 $58.64 $90.61 $64.72 $79.38 $35.65 $22.15 $27.60 $70.65 $32.90 $18.37 $25.15 $44.29 $39.19 $41.40 $42.88 $41.00 $28.65 $21.05 $23.89 $13.91 $20.57 $18.90

$61,865 18,909 16,660 7,820 7,544 6,629 6,365 4,368 4,366 3,846 3,726 2,948 2,791 2,716 2,583 2,473 2,436 2,283 2,281 2,227 2,185 2,039 1,518 1,460 1,365 1,317 1,211 1,120 1,064

$501 (1,462) (459) (396) (519) (75) (266) 38 641 (61) 342 61 (340) (248) (122) (150) (102) (37) (101) (50) (196) (129) (245) (202) (183) (100) (19) (11) (52)

$62,366 17,446 16,201 7,424 7,025 6,553 6,099 4,407 5,007 3,785 4,069 3,009 2,451 2,468 2,461 2,323 2,334 2,246 2,180 2,177 1,990 1,910 1,274 1,258 1,182 1,217 1,192 1,109 1,012


AV / Revenue CY 17E 6.1x 8.6 8.6 11.8 10.7 6.8 6.1 9.1 4.3 8.9 5.2 4.6 9.2 5.9 6.9 4.7 4.6 9.9 6.6 4.5 6.2 7.1 5.6 7.5 4.8 5.7 NA 5.8 8.5

AV / EBITDA

CY 18E 5.1x 6.9 6.7 8.4 9.0 5.6 5.2 8.5 4.0 7.1 4.8 4.1 6.8 4.5 5.5 3.8 3.8 7.1 5.3 3.9 4.9 5.4 4.8 6.0 4.1 4.9 NA 4.9 6.2

CY 17E 29.0x 65.1 39.5 NM 34.9 27.9 17.5 18.7 10.4 31.9 21.5 18.7 NM NM NM 76.4 NM NM 38.9 41.1 NM NM 17.7 NM 39.1 75.0 NA NM NM

CY 18E 23.1x 45.7 27.1 NM 28.8 22.4 13.8 17.3 9.1 24.8 19.3 15.2 NM 91.0 95.5 50.7 NM NM 28.8 26.6 66.0 NM 14.6 NM 29.6 59.9 NA 57.7 NM

Operating Metrics Price / EPS CY 17E 67.5x NM 84.4 NM 68.7 53.8 31.2 29.3 15.6 59.2 37.3 39.2 NM NM NM NM NM NM 68.8 96.3 NM NM 48.4 NM 67.2 NM NA NM NM

CY Rev. Growth

CY 18E 52.0x NM 57.6 NM 56.5 43.5 24.5 26.3 13.8 46.7 33.1 32.4 NM NM NM NM NM NM 54.4 50.2 NM NM 40.0 NM 50.6 NM NA NM NM

17E/16A 21.3% 28.9% 35.0% 61.7% 21.0% 23.9% 5.6% 2.8% 32.1% 29.9% 7.7% 13.9% 41.7% 34.8% 32.4% 29.1% 26.1% 41.6% 24.8% 13.8% 33.1% 31.3% 14.5% 26.1% 18.4% 25.4% NA 18.9% 38.5%

18E/17E 19.3% 25.1% 29.3% 39.7% 19.2% 21.7% 15.7% 6.2% 9.2% 24.6% 8.3% 13.7% 36.0% 29.8% 25.7% 23.8% 22.7% 39.0% 23.9% 15.5% 25.8% 30.2% 16.4% 23.7% 18.2% 16.7% NA 16.8% 36.9%

EBITDA Margin CY 17E 21.2% 13.2% 21.9% 0.7% 30.6% 24.3% 34.7% 48.5% 41.9% 27.7% 24.0% 24.9% NM 3.0% 3.2% 6.2% NM NM 17.0% 11.0% NM 3.8% 31.8% NM 12.4% 7.6% NA 5.6% NM

CY 18E 22.2% 15.1% 24.6% 4.3% 31.1% 24.8% 37.8% 49.3% 43.7% 28.7% 24.7% 26.9% NM 5.0% 5.7% 7.6% NM NM 18.5% 14.7% 7.4% 5.3% 33.1% NM 13.8% 8.1% NA 8.5% NM

8


Trading Statistics

Price

Equity

Net

Aggregate

5/5/2017

Value

Debt

Value

AV / Revenue CY 17E

AV / EBITDA

CY 18E

CY 17E

CY 18E


CY Rev. Growth

CY 18E

17E/16A

18E/17E


CY 18E

SaaS / On Demand (cont'd) SPS Commerce, Inc. Benefitfocus, Inc. Workiva Inc. Instructure, Inc.

$57.92 $30.25 $17.95 $25.25

$996 939 743 730

($154) 51 (44) (38)

$842 990 699 692

3.8x 3.7 3.4 4.6

3.3x 3.1 3.0 3.5

26.1x 62.5 NM NM

21.5x 33.6 NM NM

68.3x NM NM NM

55.3x NM NM NM

14.4% 13.9% 14.6% 37.0%

14.7% 18.6% 15.0% 30.5%

14.6% 6.0% NM NM

15.4% 9.4% NM NM

Carbonite, Inc. Apptio, Inc. Castlight Health, Inc. LivePerson, Inc.

$21.70 $13.86 $3.65 $7.60

613 536 476 444

(3) (111) (103) (51)

610 425 373 393

2.5 2.3 2.8 1.9

2.3 2.0 2.2 1.8

11.3 NM NM 21.1

9.3 57.4 NM 20.1

28.2 NM NM 86.0

22.1 NM NM 50.7

17.2% 12.8% 31.2% (8.1%)

9.7% 15.4% 26.6% 5.8%

22.4% NM NM 9.1%

24.7% 3.5% NM 9.0%

Bazaarvoice, Inc. ChannelAdvisor Corporation Park City Group, Inc. Amber Road, Inc.

$4.65 $11.50 $12.30 $8.40

385 303 238 227

(46) (62) (9) 8

339 241 230 235

1.7 1.9 NA 2.9

1.6 1.7 NA 2.5

20.2 34.8 NA NM

13.8 23.2 NA 89.9

NM NM NA NM

44.6 NM NA NM

1.7% 9.3% NA 11.9%

6.4% 11.4% NA 12.9%

8.2% 5.6% NA NM

11.3% 7.5% NA 2.8%

Brightcove Inc. Covisint Corporation Marin Software Incorporated

$6.03 $1.90 $1.65

204 78 65

(28) (30) (31)

175 47 34

1.2 NA NA

1.1 NA NA

NM NA NA

23.5 NA NA

NM NA NA

94.1 NA NA

1.0% NA NA

7.0% NA NA

NM NA NA

4.6% NA NA

5.7x 5.6

4.6x 4.8

33.9x 29.0

35.3x 25.7

55.8x 59.2

44.7x 46.7

22.3% 22.6%

20.2% 18.9%

17.2% 13.9%

17.2% 14.2%

Mean Median


9


Trading Statistics

Price

Equity

Net

Aggregate

5/5/2017

Value

Debt

Value

AV / Revenue CY 17E

AV / EBITDA

CY 18E

CY 17E

Operating Metrics Price / EPS

CY 18E

CY 17E

CY Rev. Growth

CY 18E

17E/16A

18E/17E


CY 18E

Business Intelligence & Analytics Splunk Inc.

$66.94

$9,260

($997)

$8,263

6.9x

5.5x

61.1x

42.5x

NM

75.0x

25.6%

26.2%

11.3%

Tableau Software, Inc.

$60.44

4,712

(955)

3,757

4.3

3.9

72.3

50.2

NM

NM

6.2%

8.6%

5.9%

7.8%

Fair Isaac Corporation

$137.91

4,270

510

4,780

5.1

4.8

18.2

17.4

26.8

22.3

4.8%

5.7%

27.7%

27.6%

Teradata Corporation

$29.40

3,848

(603)

3,245

1.5

1.6

8.9

8.5

23.3

22.1

(9.8%)

(0.7%)

17.4%

18.3%

Verint Systems Inc.

$39.35

2,456

439

2,895

2.5

2.4

11.3

10.4

14.5

12.9

7.1%

6.0%

22.5%

23.1%

$190.95

2,185

(618)

1,567

3.0

2.9

11.5

10.1

26.9

25.3

1.8%

2.9%

26.2%

28.8%

Alteryx, Inc.

$18.90

1,064

(52)

1,012

8.5

6.2

NM

NM

NM

NM

38.5%

36.9%

NM

NM

Hortonworks, Inc.

$11.15

701

(83)

617

2.6

2.0

NM

9.4

NM

NM

29.4%

26.2%

NM

21.7%

Gridsum Holding Inc.

MicroStrategy Incorporated

12.9%

$12.34

367

(76)

291

3.2

2.0

56.0

9.4

NM

16.8

56.2%

58.6%

5.8%

21.7%

Attunity Ltd.

$7.58

128

(12)

116

1.9

1.6

21.6

18.1

63.2

29.2

15.1%

15.9%

8.6%

8.8%

Datawatch Corporation

$8.50

102

(28)

74

2.0

NA

NM

NA

NM

NA

15.2%

NA

NM

NA

3.8x 3.0

3.3x 2.7

32.6x 19.9

19.6x 10.4

30.9x 26.8

29.1x 22.3

17.3% 15.1%

18.6% 12.2%

15.7% 14.4%

19.0% 21.7%

Mean Median Vertical Cerner Corporation

$64.89

$21,442

$18

$21,460

4.1x

3.8x

12.6x

11.5x

25.9x

23.4x

10.7%

7.8%

32.8%

33.3%

$502.97

10,659

(125)

10,534

4.4

3.9

17.0

14.8

22.9

19.9

12.6%

13.4%

25.9%

26.2%

$37.40 $54.39

7,630 7,544

2,336 (519)

9,966 7,025

5.9 10.7

5.6 9.0

14.4 34.9

13.1 28.8

19.3 68.7

17.2 56.5

13.2% 21.0%

5.6% 19.2%

41.1% 30.6%

42.9% 31.1%

Guidewire Software, Inc.

$61.49

4,547

(583)

3,964

7.5

6.4

46.2

27.6

89.9

55.8

17.9%

16.0%

16.2%

23.3%

athenahealth, Inc. Medidata Solutions, Inc.

$104.02 $68.14

4,144 3,969

186 (98)

4,329 3,871

3.5 7.0

3.1 5.9

16.5 28.5

13.5 22.9

55.8 52.7

41.8 44.0

12.9% 19.2%

15.4% 18.6%

21.4% 24.6%

22.7% 25.8%

Blackbaud, Inc.

$79.38

3,726

342

4,069

5.2

4.8

21.5

19.3

37.3

33.1

7.7%

8.3%

24.0%

24.7%

Ellie Mae, Inc. CoreLogic, Inc.

$107.53 $42.85

3,663 3,627

(393) 1,485

3,270 5,111

7.5 2.8

6.1 2.7

22.5 11.0

17.0 10.2

57.7 18.8

44.3 16.7

21.8% (5.1%)

23.0% 3.0%

33.1% 25.2%

35.5% 26.4%

RealPage, Inc.

$35.65

2,948

61

3,009

4.6

4.1

18.7

15.2

39.2

32.4

13.9%

13.7%

24.9%

26.9%

Allscripts Healthcare Solutions, Inc. WebMD Health Corp.

$12.38 $55.15

2,247 2,046

1,224 11

3,470 2,057

2.0 2.9

1.9 2.8

10.0 8.7

9.1 8.4

19.9 27.0

17.4 26.7

10.7% 2.2%

5.9% 2.8%

20.3% 32.9%

20.9% 33.1%

Inovalon Holdings, Inc.

$13.05

1,905

(274)

1,631

3.6

3.4

15.2

13.5

43.2

36.1

4.9%

7.4%

24.0%

25.0%

HealthStream, Inc. AppFolio, Inc.

$28.68 $26.00

914 880

(115) (27)

799 853

3.2 6.2

2.9 4.9

22.3 61.6

18.3 37.0

NM NM

94.3 NM

11.1% 30.1%

11.3% 26.2%

14.3% 10.1%

15.6% 13.3%

Instructure, Inc.

$25.25

730

(38)

692

4.6

3.5

NM

NM

NM

NM

37.0%

30.5%

NM

NM

Silver Spring Networks, Inc. Castlight Health, Inc.

$11.68 $3.65

620 476

(118) (103)

502 373

1.6 2.8

1.4 2.2

29.8 NM

16.5 NM

62.8 NM

30.2 NM

3.0% 31.2%

11.5% 26.6%

5.3% NM

8.5% NM

Exa Corporation

$13.10

195

(22)

173

2.3

2.0

29.9

19.0

NM

NM

4.9%

12.1%

7.6%

10.7%

4.6x 4.3

4.0x 3.7

23.4x 20.1

17.5x 15.8

42.7x 39.2

36.9x 32.7

14.0% 12.7%

13.9% 12.8%

23.0% 24.3%

24.8% 25.4%

Constellation Software Inc. SS&C Technologies Holdings, Inc. Veeva Systems Inc.

Mean Median Notes: Source: Capital IQ and Wall Street Estimates. Multiples 100 considered NM. Negative margins considered NM. Market Data as of 05/05/2017.

10

PUBLIC SAAS COMPANIES – VALUATION CORRELATION TO GROWTH AND CASH FLOW Valuation Correlation to Growth

Valuation Correlation to Growth & Free Cash Flow

12.0x

12.0x

R = 0.64

R = 0.70

OKTA

OKTA

VEEV

10.0x AYX

PAYC

NOW YEXT

WDAY

8.0x

10.0x

MULE

Enterprise Value / CY 2017E Revenue

Enterprise Value / CY 2017E Revenue

AZPN

TWOU ULTI

6.0x

QLYS BLKB

CRM FIVN

CALD SPSC BNFT AMBR

NEWR ZEN

MIME

CSOD RP

4.0x

HUBS PCTY

RNG

BOX JCOM

WK CARB

INST

CSLT

COUP TWOU

BNFT

4.0x CSLT

BV

ECOM

AMBR

JCOM

BOX CARB

ECOM

BV

BCOV

0%

WK APTI

NOW

HUBS ULTI PCTY

LOGM CRM FIVN ZEN NEWR BLKB CALD QLYS INST RP CSOD RNG MIME SPSC

6.0x

2.0x

APTI

MULE AYX PAYC AZPN WDAY

YEXT

8.0x

LPSN LPSN

2.0x

VEEV

BCOV

10%

20%

30%

40%

50%

CY2017E Revenue Growth

Notes: Source: Capital IQ as of 05/05/2017. Consensus Estimates used for CY2017E figures. Estimates for COVS, CLDR, MRIN and PCYG are not available.

60%

(10%)

0%

10%

20%

30%

40%

50%

60%

CY 2017E Revenue Growth % + CY 2017E FCF Margin %

11

RECENT ACQUISITIONS Select Software M&A Transactions ($MM) Announced Date

Aggregate Acquirer

Target

Target Sector

Value (AV)

AV / Revenue LTM

NTM

Target Description

5/1/17

Enterprise Networking

$610

24.4x

15.3x

Provides cloud-based WAN virtualization software that enables businesses to build unified carrier agnostic WAN and network infrastructures that connect them to their facilities, users and applications

5/1/17

Information Management

$341

1.7x

1.7x

Provides social media-based team collaboration and social media monitoring and marketing software as a service (SaaS) for businesses

Mobility

$270

NA

1.1x

Provides telecom expense management, network provisioning, M2M and mobile device management software and SaaS for businesses. Also provides related business process outsourcing (BPO) services

4/25/17

Security

$230

2.3x

1.8x

Offers cloud-based APIs and SDKs to help prevent registration fraud, reduce the risk of account takeover and authenticate end users across their account lifecycles. Includes phone-based verification and two-factor authentication and real-time security intelligence, data and analytics on phone numbers to help optimize the user-verification process and evaluate fraud risk

4/25/17

Application Software

$75

1.9x

NA

Provides networked business intelligence (BI) analytics and reporting SaaS for businesses. Software also provides features for data processing and aggregation, data warehouse automation, and the reporting and analysis of CRM, sales and supply chain analytics

4/12/17


$120

NA

NA

Provides channel data management SaaS for the consumer electronics sector globally. Software enables companies to intelligently manage global indirect channel sales and inventory data, as well as increase channel visibility

4/4/17


$80

0.7x

NA

Provides customer relationship management (CRM) SaaS that tracks and logs all telephone, text, chat and emailbased communications for healthcare markets. Also provides customer analytics software and a directory of healthcare insurance plans

4/3/17


$50

NA

NA

Provides scholarship management SaaS for K-12 schools, universities and nonprofits. Software provides features for the digital management, awarding, reporting and stewardship of academic awards for students

4/3/17


$73

4.8x

NA

Provides mathematical data analysis and modeling software to engineering and scientific research markets

4/3/17

Infrastructure Management

$92

0.5x

NA

Provides trading software, collaborative data management and EDI software for the securities trading sector


$400

NA

NA

Experian's cross-channel marketing business, which provides marketing automation and email advertising SaaS and outsourced BPO services for businesses and ad agencies worldwide

Security

$366

NA

NA

Operates as the Chinese division of NQ Mobile, which provides Android, Windows Phone, Symbian and BlackBerry smart phone anti-virus and anti-malware software for businesses and consumers globally. Also provides mobile call blocking and device optimization software


$200

6.3x

4.4x

Provides Web and mobile application testing software for enterprises. Features include website performance testing and management, application load testing, and performance analytics


$270

NA

NA

Provides water resource and environmental management and simulation software to the utilities industry globally. Stantec obtained ownership of Innovyze through the 2016 acquisition of MWH Global


$205

7.3x

NA

Provides investment portfolio business intelligence (BI) software for the investment and finance sector globally. Software provides features for data management, portfolio performance analytics, risk management and reporting

4/28/17

Marlin Equity Partners

Tangoe

4/3/17 (Cros s -channel Ma rketing Division)

3/30/17

(Tongfang Investment Fund Series SPC)

(Bei jing Feiliu Ji utian Technology Co.)

3/29/17

3/21/17

3/20/17

(

(

)

)

Notes: Source: Capital IQ and Wall Street Estimates. Reflects M&A activity through 05/05/2017, where Aggregate Value is > $50MM. Transactions highlighted in yellow denote Private Equity Acquirers.

12


Aggregate Acquirer

Target

Target Sector

Value (AV)

AV / Revenue LTM

NTM

Target Description

3/7/17

Security

$614

5.6x

NA

Provides automated application penetration and network vulnerability testing SaaS for enterprise software developers

3/7/17


$317

5.3x

NA

Provides on-premise and cloud-based accounting and performance management software and SaaS, including budgeting, planning, reporting and analytics, for businesses

2/28/17

Security

$105

10.5x

NA

Provides behavior-based profiling SaaS for enterprises, enabling breach-detection and visibility into advanced or targeted attacks, insider threats and malware that have circumvented traditional security controls


$290

8.1x

NA

The multi-family housing business and product portfolio of Rainmaker, which provides revenue budgeting, forecasting and revenue cycle management software for multi-family real estate sectors

2/23/17


$325

5.4x

NA

Provides software-based domain name services (DNS), Dynamic Host Configuration Protocol (DHCP) and IP address management SaaS for enterprises. Software provides features for the management and automation of network DNS activity, mobile BYOD device management and the detection of threats

2/23/17


$175

2.4x

2.3x

Provides Web-based SaaS for the automation and management of performance appraisals, feedback, compensation management, succession planning, job descriptions, learning management and recruiting for corporate HR departments

2/15/17


$102

1.3x

NA

Provides insurance policy and pharmacy claims processing software and SaaS for the insurance and pharmaceutical sector. Also provides colocation, disaster recovery, managed hosting and systems integration services

2/14/17


$59

1.9x

1.6x

Provides wealth management and ERP and transaction processing SaaS for the investment and finance sector globally

2/27/17 (Multi-Family Housing Business)

(

)

2/9/17

Nokia Corporation

Comptel Corporation

Carrier Infrastructure

$373

3.5x

3.1x

Provides network management and operational support system (OSS) software and related managed services for telecom service provides globally

2/8/17

Sophos

Invincea

Security

$120

12.2x

NA

Provides endpoint security software for small businesses and enterprises in the healthcare, financial services and government industries. Software provides features for detection of spear-phishing, watering hole and website hijacking attacks. Also provides server security breach management SaaS

2/2/17

Hexagon AB

MSC Software Corporation


$834

3.6x

NA

Provides motion control, dynamics and acoustical vibration simulation and modeling software for businesses

Security

$120

NA

NA

Provides iris recognition biometric systems for use in mobile devices and automobiles

Storage

$67

NA

NA

Provides on-site, hosted and cloud-based back-up and recovery, data protection and replication software for use in disaster recovery for businesses

1/27/17


$128

NA

NA

Provides K-12 education assessment management software for schools and educators. Software provides features for summative assessments design and testing for grades 3-8 according to state, district and federal regulations, scoring and reporting to students

1/25/17


$1,400

NA

NA

Provides electronic medication prior authorization software for pharmacies, healthcare providers, and pharmaceutical companies. Software is integrated into electronic health records so that healthcare providers and doctors can provide electronic authorization for patients to take medications

(

2/1/17

Fingerprint Cards AB

)

Delta ID Inc.

(

)

1/31/17

(

)


13

RECENT ACQUISITIONS Select Software M&A Transactions ($MM) Announced

Aggregate

Date

Acquirer

Target

Target Sector

Value (AV)

AV / Revenue LTM

NTM

Target Description


$3,903

18.9x

NA

Provides application performance management (APM) SaaS and mobile applications, enabling the monitoring and troubleshooting of applications, extensions, plugins, databases, and servers for businesses. Also provides related analytics reporting software

Hosted Services

$84

NA

NA

Provides domain name registration and related services to corporate and consumer website owners. Related services include web hosting and an auction service for website domain name resellers


$800

4.6x

NA

Provides project and portfolio management SaaS and related systems integration services for enterprises. Software includes features for plan design, agile project portfolio management and cost analysis and control

1/17/17

Storage

$650

6.5x

NA

Provides backup and recovery storage systems and storage management software for businesses. Storage systems feature virtual machine (VM) level management, in-line de-duplication and compression of data, including backup copies of VMs that can be replicated to secondary datacenters

1/9/17


$425

NA

NA

Provides social collaboration online software for enterprise employees and consumers. Software allows employees and consumers to create "boards" where members collaborate to complete tasks for a project, with features that include messaging and notifications

1/4/17


$134

19.1x

7.0x

Provides health benefits management SaaS for businesses. Software provides features for financial management, customized health benefit plans, and data and analytics reporting. Also provides mobile access and systems integration services

12/23/16


$53

NA

NA

Provides cloud-based global import and export trade reference software and an online database of analysis content, cargo details and related company profiles for businesses at www.datamyne.com

12/20/16


$67

NA

NA

Provides client reporting software and services for the investment and financial services sectors globally

Security

$560

NA

NA

Provides digital rights management SaaS for businesses and content producers, as well as an online digital music and video content recognition database for consumers and the entertainment sector

12/19/16


$160

3.9x

NA

Provides insurance policy administration and management software as a service (SaaS) and on-premise for property and casualty insurance companies. Features include claims management, billing and document management. Also provides related services

12/19/16

Mobility

$67

NA

NA

Designs and develops graphical user interfaces (GUI) for mobile phones and automotive displays, to automotive and other embedded display manufacturers

12/13/16


$130

NA

NA

The vendor management software and related assets of Beeline, which provides vendor management systems (VMS) for businesses globally. Software provides spending management, procurement cycle automation and quality control monitoring


$60

NA

NA

Provides on premise and cloud-based channel and contract management software for businesses in the life sciences industry. Software provides features for revenue management, contract lifecycle management and performance analytics reporting

Security

$850

4.0x

NA

The identity management business of 3M, which consists of 3M Cogent, a biometric identification system, and 3M's document reader and secure materials systems and software. Assets are used by civil identification, border control and law enforcement agencies


$850

NA

NA

Sungard's public sector business, which provides ERP administration SaaS for government and public safety entities and the K-12 business, which provides cloud-based administration and student management software for K-12 educators

1/24/17

1/20/17

(

)

1/19/17

(

)

12/20/16

(

(

)

(

)

)

12/12/16

(

)

12/9/16 (Identity Management Business)

12/7/16

/

(Public Sector & K-12 Education Businesses)


14


Aggregate Acquirer

Target

Target Sector

Value (AV)

AV / Revenue LTM

NTM

Target Description

Hosted Services / Managed Security Services

$1,800

2.6x

NA

Provides network and wireless network IT security auditing, compliance and penetration testing services for businesses and government agencies globally. Also operates as an information security VAR and provides security systems integration services


$2,800

NA

5.2x

Provides ERP, HR management, CRM and project management software, SaaS and systems integration services, for government contractors, professional services firms and other project-based businesses globally

12/6/16


$856

2.9x

2.7x

Provides team collaboration SaaS enabling businesses globally in the life science, financial, oil and gas, technology and manufacturing industries to securely exchange documents and sync files

12/2/16


$65

6.5x

NA

Provides IoT predictive analytics, data mining and event processing software and SaaS for businesses

12/1/16


$636

5.1x

NA

Provides IT process automation and job scheduling software for businesses globally. Applications manage file transfers, virtual machine provisioning, application release management and error identification and remediation


$112

2.2x

NA

Provides enterprise data quality SaaS for business. Software provides features for data analysis, profiling, validation and cleansing for businesses operating in the retail, insurance, healthcare and financial industries

11/29/16


$190

3.8x

NA

Provides online advertising campaign management and ad-serving SaaS for businesses

11/20/16

Security

$2,362

3.6x

3.3x

Provides online identity theft and credit rating monitoring software for consumers and businesses in the US

11/15/16


$153

NA

NA

Provides Industrial Internet of Things (IIoT) data integration automation and analytics SaaS for businesses in the energy, aviation and manufacturing sectors

11/14/16


$915

10.2x

NA

Provides field service and contract management SaaS and mobile applications for service-oriented businesses and enterprises. Software provides features for dispatch and scheduling, warranty, parts and return management and field service metrics reporting

11/10/16


$270

NA

NA

Provides asset and financial management SaaS to businesses and investors in the global aviation industry. Software provides features for investment management, short term and long term bridge financing, contract financing, customized portfolio securitization facilities, and transaction and assess risk monetization

11/8/16


$300

7.9x

NA

Provides SAP-based project, plant and asset management ERP software for enterprises. Software provides features for scheduling, project planning, workforce management and analytics reporting, accessible on desktop systems and mobile devices

10/31/16


$632

NA

4.2x

Provides data management SaaS to the manufacturing and construction industry in the United States and Canada. Software provides features for financial risk management, vendor management, commercial construction project search engines, analytics and reporting, and product marketing to industry professionals

10/27/16


$55

NA

3.7x

Provides team collaboration messaging SaaS that enables physicians at hospitals to communicate with patients via a managed messaging system

10/24/16

Security

$58

NA

3.7x

Provides IP traffic classification and network intelligence software used in physical, SDN and NFV architectures. Supplies software to vendors that embed real-time application visibility in their products for cybersecurity, traffic optimization, service chaining and quality of service, and analytics

12/6/16

(

)

12/6/16

(

)

11/30/16

(

)


15


Aggregate Acquirer

Target

Target Sector

Value (AV)

AV / Revenue LTM

NTM

Target Description

10/21/16


$410

NA

NA

Provides electronic evidence and data recovery SaaS and services for law firms, government agencies and corporate law departments. Software provides features for data collection, portfolio and project management, forensic review and data replication and destruction

10/20/16

Security

$55

NA

NA

Provides cloud application control (CAC) software for enterprises. Software enables detection and targeted attack protection (TAP) for enterprises using SaaS applications on enterprise networks and on mobile devices against malware attacks

10/4/16

Security

$60

NA

NA

Provides cloud-based third-party access control SaaS to IT businesses, enabling access to applications that are hosted in data centers and to Microsoft SharePoint on enterprise networks. Software also provides data path protection, identity access management and application security

10/4/16


$250

NA

1.9x

Provides retail brand and e-commerce online shopping marketing and advertising SaaS for businesses

10/4/16


$680

13.1x

NA

Provides real-time audience data management and targeting SaaS for marketers, Web publishers and ad agencies. Software enables continuous customer and prospect data collection from digital interactions, including website visits or ads served


$180

2.4x

NA

Provides parking software, SaaS and systems that enables parking management, enforcement, permits, collections, access and revenue control. Also provides related handheld input devices and software development services


$153

NA

NA

Provides email and digital subscription management SaaS that enables US government agencies to provide citizens with information about such topics as local emergencies, events, council minutes and other matters through email, wireless alerts, and RSS feeds

Data Centers & Facilities

$185

NA

NA

Provides facilities management SaaS for sustainable resource planning for multi-site corporations. Software is used to measure and manage carbon emissions and waste and allocate energy resources throughout multiple facilities


$60

12.0x

NA

Provides Apache JMeter open-source load testing SaaS, enabling mobile app performance testing and monitoring for Web, mobile app, micro services and API developers and businesses


$135

NA

NA

The technology assets of INVeSHARE Inc. which provides embeddable Web-based shareholder communication SaaS to brokerage firms and shareholders


$1,250

3.5x

3.4x

Provides DNS, DHCP, and IP address (DDI) management and network service delivery software and management appliances for enterprises, government agencies and service providers worldwide

All Software Median

4.6x

3.3x

Mean

6.2x

3.9x

PE Median

3.0x

2.0x

Mean

3.8x

2.1x

9/29/16

(

)

9/26/16

(

)

9/22/16

(

)

9/20/16

9/19/16 (Technology As sets)

9/19/16


16

RECENT PRIVATE FINANCINGS ($MM)

Deal Date

Company

Amount Raised

Brief Description

5/4/17

DeepMap

$25

Developer of an HD mapping and localization platform intended to bring autonomous cars onto roads.

Accel, GSR Ventures, Andreessen Horowitz

5/4/17

Fuze

$134

Provider of a cloud-based unified communications platform designed to simplify business voice communications and flexible video conferencing.

Greenspring Associates, Wellington Management, Bessemer Venture Partners, G20 Ventures, Summit Partners

5/4/17

Heap

$27

Developer of mobile and web analytics tools designed to automatically capture all user data.

Initialized Capital, Menlo Ventures, New Enterprise Associates, Pear Ventures

5/4/17

PayScale

$29

Provider of online cloud compensation software intended to provide an immediate and precise snapshot of current market salaries.

NA

5/4/17

Signifyd

$56

Provider of a standalone risk and guaranteed fraud-prevention platform designed to make commerce safer.

Bain Capital Ventures, American Express Ventures, Menlo Ventures

5/4/17

Transwarp (Big Data)

$34

Developer of big data software technologies for enterprises.

Co-Stone Capital, Tencent, Triwise Capital, Xingrui Zhixin

5/2/17

Dinova

$40

Provider of a marketplace that connects expense account diners to restaurants.

Frontier Capital

5/2/17

ServiceChannel

$54

Provider of SaaS based vertical marketplace intended to optimize millions of transactions and billions of dollars of spend annually.

Accel

4/28/17

Electronic Commerce

$24

Provider of a cloud-based human capital management (HCM) platform.

NA

4/28/17

Rubrik

$180

Provider of cloud infrastructure technology designed for data protection, search, analytics, archival and copy data management.

IVP, Greylock Partners, Lightspeed Venture Partners

4/27/17

Singapore Life

$50

Developer of an online insurance technology platform created to transform the insurance industry.

Credit China Holdings, IPGL

4/27/17

Snow Software

$128

Provider of a software asset management platform developed to help organizations avoid overpaying for software.

Ontario Pension Board, Sumeru Equity Partners

4/27/17

UiPath

$30

Developer of a robotic process automation software designed to power the intelligent process automation service offered by the most technology savvy BPO providers.

Accel, Credo Ventures, Earlybird Venture Capital, Seedcamp

4/27/17

Zeta Global

$140

Provider of big data and analytics platform intended to help their customers solve their most complex marketing problems.

GPI Capital, FS Investment Solutions, GSO Capital Partners

4/26/17

Domino (Data Lab)

$27

Developer of an enterprise data science platform designed to offer cloud computing, version control and model deployment services.

Coatue Management, Bloomberg Beta, Sequoia Capital, Zetta Venture Partners

Investors

Notes: Source: Pitchbook. Reflects deal activity through 05/05/2017. Transactions reflect recent Software Venture and Private Equity Growth / Expansion activity where the amount raised was greater than or equal to $20MM.

17


Deal Date

Company

Amount Raised

4/26/17

Domo

$107

Provider of a cloud-based business-management platform. The company offers an intuitive platform that provides a central location for data access and management.

SharesPost, BlackRock, GGV Capital, Glynn Capital Management, The Capital Group Companies

4/26/17

EverFi

$190

Developer of a SaaS digital learning platform designed to empower organizations everywhere to instill knowledge around critical topics in the classroom, in the office and in the community.

MainStreet Advisors, The Rise Fund, TPG Growth, Advanced Publications, Allen & Company, Bezos Expeditions, Eric Schmidt, Evan Williams

4/26/17

Ivalua

$70

Developer of web based spend management software services intended to unlock maximum procurement Value through realizing savings.

Kohlberg Kravis Roberts

4/26/17

Robinhood

$110

Developer of a mobile stock trading application designed to democratize access to the financial markets.

DST Global, Greenoaks Capital, Thrive Capital, Index Ventures (UK), New Enterprise Associates, Ribbit Capital

4/25/17

LoveCrafts

$33

Operator of a crafting community and marketplace designed to purchase and sell craft works and craft material.

Scottish Equity Partners, Balderton Capital, Highland Capital Partners Europe

4/25/17

Science 37

$29

Developer of clinical research technology focused on making clinical trials better for patients.

Amgen Ventures, Glynn Capital Management, GV, dRx Capital, Lux Capital, Redmile Group, Sanofi-Genzyme Bioventures

4/25/17

Work Market

$25

Developer of a SaaS labor automation platform designed to help companies build and scale a flexible workforce.

Accenture, Foundry Group

4/24/17

Nav

$39

Provider of a platform for business owners to manage their business credit.

Clocktower Technology Ventures, CreditEase, Experian, Point 72 Ventures, The Goldman Sachs Group, ZenStone Venture Capital, AngelList, Crosslink Capital, CSC UpShot Ventures, Fenway Summer Ventures, Kickstart Seed Fund, Kleiner Perkins Caufield & Byers, Peak Ventures, Rock & Hammer Ventures, Tencent

4/21/17

Katerra

$130

Developer of a construction technology platform designed to transform the way buildings and spaces come to life.

Draper Fisher Jurvetson, Foxconn Technology, Greenoaks Capital, Khosla Ventures, Moore Capital Management, Paxion Capital Partners

4/21/17

Quora

$85

Developer of a question and answer website designed to share and grow the world's knowledge.

Collaborative Fund, Dustin Moskovitz, Matrix Partners, Tiger Global Management, Y Combinator

4/20/17

Getaround

$45

Provider of a peer-to-peer, car-sharing marketplace. The company offers a Webbased platform that enables car owners to rent out their cars on an on-demand basis.

Braemar Energy Ventures, SAIC Capital, SPARX Group, Toyota Motor, Menlo Ventures, SOSV, Triangle Peak Partners

4/20/17

Gladly

$36

Developer of a SaaS based communication technology designed to simplify customer service across calls, social media and emails.

GGV Capital, Greylock Partners, New Enterprise Associates

4/20/17

MakeSpace

$30

Provider of storage services designed to make storage more consumer-friendly. The company's storage services provide pick-up, packing and delivery services so that customers never have to visit a storage facility.

8VC, Carmelo Anthony, Nasir Dara Jones, Harmony Partners, Summit Action, Upfront Ventures

4/20/17

Peloton Technology

$65

Developer of an automated vehicle technology designed to improve the U.S. and global freight transportation.

B37 Ventures, BP Ventures, Breakthrough Fuel, LLC, Grupo Bimbo, Mitsui & Company, Okaya & Company, Omnitracs, Schlumberger, U.S. Venture, Band of Angels, Birchmere Ventures, Castrol InnoVentures, Denso International America, Intel Capital, Lockheed Martin, Nokia Growth Partners, Sand Hill Angels, UPS Strategic Enterprise Fund, Volvo Group Venture Capital

4/20/17

Reltio

$40

Provider of data-driven application designed to manage modern data management thorough Platform as a Service (PaaS).

Sapphire Ventures, .406 Ventures, Crosslink Capital, New Enterprise Associates

Brief Description

Investors


18


Deal Date

Company

Amount Raised

4/20/17

Sensetime

$60

Developer of artificial intelligence and deep learning based face recognition technology.

Sailing Capital

4/19/17

ZappRx

$25

Provider of an online prescription management platform designed to modernize, automate and streamline the specialty drug process.

GV, Qiming Venture Partners, SR One

4/18/17

CyberGRX

$20

Provider of a third-party cyber risk management platform designed to simplify oneclick access to third party cyber risk assessments.

Bessemer Venture Partners, Aetna Ventures, Allegis Capital, ClearSky Power & Technology Fund, GV, MassMutual Ventures, Rally Ventures, Ten Eleven Ventures

4/18/17

SeatGeek

$57

Developer of a ticket search engine designed to transform the way that fans buy and sell tickets to their favorite events.

Glynn Capital Management, Accel, Causeway Media Partners, Haystack Partners, Mousse Partners, Technology Crossover Ventures

4/18/17

Ziften

$39

Developer of an enterprise system efficiency software. The company provides a software which allows users to understand and control the applications and other processes running across the physical or virtual Windows desktop environment.

Spring Mountain Capital, Fayez Sarofim

4/13/17

PagerDuty

$44

Developer of an incident resolution platform designed to manage digital operations for businesses.

Accel, Andreessen Horowitz, Baseline Ventures, Bessemer Venture Partners, Harrison Metal Capital

4/12/17

Blink Health

$90

Provider of a reduced-cost prescription platform designed to offer medications at affordable price.

8VC

4/11/17

Branch (platform)

$60

Developer of a deep linking technology designed to gain and retain mobile app users.

Playground Global, Benjamin Narasin, Cowboy Ventures, Founders Fund, Madrona Venture Group, New Enterprise Associates, Pear Ventures, Samsung NEXT Ventures, Zach Coelius

4/11/17

MobiKwik

$50

Provider of an independent mobile payments network designed for online money transactions.

Bennett Coleman and Company, GMO VenturePartners, MediaTek, Net 1 UEPS Technologies, Sequoia Capital India, Cisco Investments, Tree Line Asia

4/11/17

OverOps

$31

Developer of a cloud-based platform designed to debug production code.

NA

4/10/17

Bigcommerce

$34

Provider of software services to online retailers and merchants. The company provides a platform for small- and medium-sized businesses, enabling them to quickly launch professional stores.

GGV Capital, Millenium Partners, Millennium Technology Value Partners, Revolution, Stephan Schambach, Washington University in St. Louis Endowment, American Express Ventures, Floodgate Fund, General Catalyst Partners, RevolutionGrowth, SoftBank Capital, Split Rock Partners, Telstra Ventures, Tenaya Capital

4/11/17

Synack

$21

Developer of a crowd security testing platform designed to redefine traditional models of security testing through revolutionary technology and innovative thinking.

Hewlett Packard Enterprise, Microsoft Ventures, SingTel Innov8, Allegis Capital, GGV Capital, Greylock Partners, GV, Icon Ventures, Kleiner Perkins Caufield & Byers

4/10/17

Next Insurance

$25

Provider of online small business insurance platform designed to transform the insurance experience for small businesses.

NA

4/7/17

Mic Network

$21

Provider of news and media platform intended to inform, empower and inspire millennials.

Hakuhodo DY Holding, Kyu Collective, Time Warner Investments, You & Mr Jones Brandtech Ventures, Lightspeed Venture Partners

4/7/17

Otonomo

$25

Developer of a car data exchange platform designed to easily access, integrate and explore car-generated data.

Delphi Automotive, Bessemer Venture Partners, Maniv Mobility, StageOne Ventures

Brief Description

Investors


19


Deal Date

Company

Amount Raised

4/7/17

Reflexis Systems

$33

Provider of retail execution management software.

Great Hill Partners, Sageview Capital

4/7/17

Souche.com

$180

Provider of an online platform designed to buy and sell pre-owned cars.

ClearVue Partners, CreditEase New Financial Industrial Fund, Haitong International Securities, VMS Investment Group, Warburg Pincus, Zuoyu Capital, Morningside Group

4/7/17

Toutiao

$1,000

Provider of personalized news articles and pictures for application user.

CCB International Asset Management, Sequoia Capital China, Yuri Milner

4/7/17

Upgrade (US)

$54

Provider of marketing tools intended to help users in understanding and improving their credit score.

CreditEase, FirstMark Capital, Noah Holdings, Ribbit Capital, Sands Capital Ventures, SVB Financial Group, Union Square Ventures, Uprising, Vy Capital, Yuri Milner

4/7/17

Uptake Technologies

$90

Developer of a predictive analytics platform designed to transform data into measurable business value.

RevolutionGrowth

4/6/17

daPulse

$25

Provider of a SaaS based project management tool designed to manage projects, tasks, processes and workflows.

Insight Venture Partners, Entrée Capital, Genesis Partners

4/6/17

Lyft

$500

Provider of an on-demand ride-sharing platform designed to match customers with local drivers through their smartphone.

General Motors

4/6/17

Syscloud Technology

$21

Developer of a cloud exchange platform designed to provide exchange services and efficient connections in the global business market.

Capitech, Chenhui Venture Partners, Fortune Venture Capital, Shenzhen Comix Group Company

4/6/17

Trōv

$45

Provider of an on-demand insurance platform designed to simplify the insurance service for single items.

Munich Re/HSB Ventures, Sompo Japan Nipponkoa Holdings, Anthemis Group, Guidewire Software, Oak HC/FT, Suncorp Group

4/5/17

Armor (Cloud Security Platform)

$89

Developer of SaaS-based managed security platform designed to prevent business data from being violated.

Singapore Technologies Telemedia

4/5/17

Snowflake

$100

Developer of a SaaS-based cloud data warehousing platform designed to safely and efficiently store, transform and analyze business data so anyone can easily and quickly gain data-driven insight.

ICONIQ Capital, Madrona Venture Group, Altimeter Capital Management, Redpoint Ventures, Sutter Hill Ventures, Wing Venture Partners

4/5/17

Wecash

$80

Developer of a credit assessment platform created to provide credit evaluation services to consumers and businesses in China.

China Merchants Group, Dongfang Hongdao Asset Management, Forebright Capital Management, Lingfeng Capital, SIG Ventures

4/4/17

HealthEngine

$20

Provider of an online health dictionary and booking system listing designed to connect patients and practitioners with healthcare professionals.

Adam Scwab, Alium Capital Partners, Go Capital (Australia), Sequoia Capital India, Greg Roebuck

4/4/17

Portworx

$20

Provider of container data services designed to automate the deployment and operations of data services at scale.

GE Ventures, Sapphire Ventures, Mayfield

4/4/17

Qumulo

$30

Provider of a cloud-based enterprise data storage platform designed to manage and store enormous numbers of digital assets through real-time analytics.

Northern Light Venture Capital, Kleiner Perkins Caufield & Byers, Madrona Venture Group, Top Tier Capital Partners, Tyche Partners

Brief Description

Investors


20


Deal Date

Company

Amount Raised

Brief Description

3/30/17

Looker

$82

Developer of a business intelligence and big data analytics platform designed to bring better insights and data-driven decisions to every business.

CapitalG, Geodesic Capital, The Goldman Sachs Group, Kleiner Perkins Caufield & Byers, Meritech Capital Partners, Redpoint Ventures, Sapphire Ventures

3/30/17

Yongqianbao

$68

Developer of personal lending platform created to revolutionize risk control by automating the work of loan officers.

CASH Capital, CICC ALPHA, Golden Brick Capital, Kai-Fu Lee, GX CAPITAL, Sinovation Ventures, Source Code Capital

3/29/17

Freightos

$25

Provider of freight sales automation platform designed to power online freight for global shippers and forwarders.

GE Ventures, Gold Lion Holdings, Master (HK) Toys, MSR Capital, Sadara VenturesAleph, Annox Capital, Israel Cleantech Ventures, OurCrowd

3/29/17

MapD

$25

Developer of a big data analytics and visualization platform designed to make multibillion record data-sets to be queried and visualized in milliseconds.

New Enterprise Associates, Nvidia, Vanedge Capital, Verizon Ventures

3/29/17

UCloud

$140

Provider a cloud infrastructure-as-a-service (IaaS) platform designed to offer Chinese internet enterprises with cloud computing resources.

CICC ALPHA, Oriza Holdings

3/28/17

MasterClass

$35

Provider of an online education platform designed to offer video based vocational courses.

GSV Ventures, IVP, Samuel Lessin, Advancit Capital, Bloomberg Beta, Javelin Venture Partners, Matthew Rutler, New Enterprise Associates, Novel TMT Ventures, Yan-David Erlich

3/28/17

Picnic (platform software)

$109

Operator of an online grocery supermarket created to provide groceries at lowest prices.

De Hoge Dennen Capital, Finci, Hoyberg, NPM Capital

3/28/17

ReputationDefender

$20

Provider of reputation management services designed to provide online reputation and digital privacy services for individuals and businesses.

Ascension Ventures, Heritage Group, Manatt Digital Media Ventures, August Capital, Bessemer Venture Partners, Focus Ventures, Icon Ventures, Kleiner Perkins Caufield & Byers

3/28/17

Rigetti

$40

Developer of cloud quantum computing platform designed to build the world's most powerful computer.

Vy Capital, AME Cloud Ventures, Andreessen Horowitz, Data Collective, Founders Fund, Morado Venture Partners, Y Combinator

3/28/17

Turvo

$25

Developer of a collaborative logistics platform designed to revolutionize the way things move by creating a standard way to share, communicate and collaborate in real time.

Aaron Levie, Activant Capital Group, Anthony Fadell, Felicis Ventures, Kevin Nazemi, Ravi Venkatesan, Slow Ventures, Upside Partnership

3/27/17

Creamfinance

$22

Provider of online consumer finance services intended to offer one-click loans to consumers globally.

Capitec Bank Holdings

3/27/17

Evariant

$64

Provider of SaaS-based enterprise platform designed to modernize physician alignment strategies with data analysis.

McKesson Ventures, The Goldman Sachs Group, Health Enterprise Partners, Lightspeed Venture Partners, Salesforce Ventures

3/24/17

Lystable

$25

Provider of a vendor management platform. The company offers an online platform where organizations can list all their contacts and partners in a centralized system.

Glynn Capital Management, Goldcrest Capital, Kindred Capital, LeFrak, Max Levchin, SciFi VC, Wilmot Ventures, Spring Capital Partners, Valar Ventures

3/23/17

CiBO Technologies

$30

Provider of big data analytics software intended to catalyze a sustainable revolution in agriculture.

NA

3/23/17

DataRobot

$54

Developer of an advanced enterprise machine learning platform designed to build machine learning models.

New Enterprise Associates

Investors


21

SOFTWARE CAPITAL MARKETS UPDATE Recent Software IPO Pricings ($ M M )

Market Cap @ IPO Date

Amount Raised

Pre IPO Filing Range

Offer Price

% Change Offer / Midpoint Price

% Change 1st Trading Day / Offer Price

% Change Current / Offer Price

28-Apr-17

$2,318

$225

12.00 - 14.00

$15.00

15.4%

21.3%

33.1%

13-Apr-17

$1,146

$116

8.00 - 10.00

$11.00

22.2%

21.9%

26.5%

7-Apr-17

$2,134

$187

15.00 - 17.00

$17.00

6.3%

38.3%

47.9%

24-Mar-17

$873

$126

12.00 - 14.00

$14.00

7.7%

10.7%

35.0%

16-Mar-17

$3,118

$221

14.00 - 16.00

$17.00

13.3%

45.6%

30.3%

28-Oct-16

$1,169

$146

16.00 - 17.00

$17.00

3.0%

40.5%

93.3%

6-Oct-16

$1,601

$133

14.00 - 16.00

$18.00

20.0%

84.9%

59.2%

Offer Date

(1)

Name

Notes: Source: Capital IQ and Dealogic. Market Data as of 05/05/2017. (1) First Trading Day listed as Offer Date.

22

IPO PIPELINE Software IPOs in Public Registration ($MM)

Issuer

Amount Raised (3)

Funding TD

EBIT

Last Financing Date

Post Money Valuation

($16)

17-Feb-14

$38

$48

$414

LTM

Primary Industry

Initial Filing Date

Initial Offering Amount

Revenue

Rev Growth (2)

Business/Productivity Software

27-Apr-17

$86

$135

19.5%

(1)

Notes: Source: Pitchbook and SEC.gov. Offering amounts $20MM or greater. (1) LTM as of 03/31/2017. (2) CY 2016/2015A Revenue Growth. (3) Reflects last financing > $25MM.

23

A SHRINKING UNIVERSE OF PUBLICLY TRADED SOFTWARE COMPANIES Strategic and Private Equity Exits Outweigh New Issues

PE Acquisitions

210

Strategic Acquisitions

IPO

200 195

6

(7)

11

(11)

(5)

190

7

(4) Fortinet CDC Software LogMeIn Medidata SolarWinds Rosetta Stone

180

170

(6)

(11)

(8)

17

(9)

(6) SciQuest RealPage IntraLinks Envestnet Qlik BroadSoft Higher One Convio SPS Commerce SS&C QuinStreet

11

17

16 (9)

(10)

(7)

(6) (8)

Jive Imperva Carbonite Tangoe Responsys Cornerstone Epocrates

Workday Fleetmatics Qualys Eloqua E2open ServiceNow Exa Incadea Infloblox Proofpoint Splunk ExactTarget Demandware Bazaarvoice Greenway AVG Guidewire

160

Workiva Hortonworks New Relic HubSpot CyberArk MobileIron Kinaxis Zendesk Paycom OPOWER Five9 2U Borderfree Amber Road A10 Networks Paylocity Varonis Systems

Mavenir Barracuda Wix.com Covisint RingCentral FireEye Cvent Gigamon Textura ChannelAdvisor Marketo Tableau Halogen Rally Marin Model N

Atlassian Mimecast Instructure Rapid7 Sophos AppFolio Alarm.Com Xactly Shopify Apigee Box

9

(12)

Twilio SecureWorks Talend Everbridge Apptio Gridsum Holding Nutanix Coupa BlackLine, Inc.

(9)

(3)

5

(3)

160

Mulesoft Alteryx Okta Yext Cloudera

150 2008

2009

IPO Strategic Exits PE Exits

2010

2009 +6 -7 -5

Notes: Sources: Capital IQ, company filings. Market Data as of 05/05/2017.

2011

2010 + 11 - 11 -4

2012

2011 +7 -8 -6

2013

2012 + 17 - 11 -9

2013 + 16 -9 -6

2014

2014 + 17 -6 -7

2015

2015 + 11 - 10 -8

2016

2016 +9 - 12 -9

2017

2017 +5 -3 -3

24

VENTURE CAPITAL INDUSTRY TMT Transactions Since Q1 2002 $12

1,000

$10 800

$Bn

600

$6

400 $4

200 $2

$0 Q1 2002

Q1 2003

Q1 2004

Q1 2005

Q1 2006

Q1 2007

Q1 2008

Q1 2009

Q1 2010

Q1 2011

Q1 2012

Q1 2013

Q1 2014

Q1 2015

Q1 2016

0 Q1 2017

Quarter - Year (1)

Number of Deals

Investment Amount

Notes: (1) Number of TMT VC Investments per PriceWaterhouseCoopers / NVCA MoneyTree report. TMT inclusive of Computers and Peripherals, Electronics / Instrumentation, IT Services, Media and Entertainment, Networking and Equipment, Semiconductors, Software and Telecommunications until Q3 2016. As of Q4 2016, TMT inclusive of Computer Hardware / Services, Electronics, Internet, Media (Traditional), Mobile / Telecommunications, Risk & Security Systems, and Software.

25

Number of Investments

$8

GCA OVERVIEW Deep Software Sector Expertise

Acquired by

Acquired by

Acquired by

Acquired by

Preferred Stock

Acquired by

Acquired by

Acquired by

Acquired by

We Advised the Seller




Financial Advisor





Acquisition of

Acquired by

Acquired by

Convertible Note Offering

Strategic Advisory Services

Investment by

Preferred Stock

Acquisition of

Acquisition of

We Advised the Buyer



Financial Advisor

Financial Advisor


Financial Advisor



Acquired by

Acquired by

Acquired by

Acquired by

Preferred Stock

Acquired by

Acquired by

Acquired by

Acquired by





Financial Advisor





Acquired by

Acquired by

Acquired by

Acquired by

Acquired by





Acquisition of


Acquired by


Acquired by

Fairness Opinion to Buddy Media


Notes: The above transactions represents a compilation of past and current deals that GCA entities have advised on. Generally, GCA Corporation advises Asian-based transactions, while GCA Advisors, LLC advises U.S.-based transactions and GCA Altium advises UK/European-based transactions. At times, multiple GCA entities may be retained to advise on the same transaction.

Acquired by


26

Software Sector Summary Report - GCA Savvian [PDF]

Software Sector Summary Report - GCA Savvian [PDF]

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