Software Sector Summary Report

Software Sector Summary Week of March 27th, 2017 1

SOFTWARE DEAL DASHBOARD $12.9 Billion

143

$11.5 Billion

23

Financing Volume 2017 YTD (1)(2)

Financing Transactions 2017 YTD (1)(2)

M&A Volume 2017 YTD (3)

M&A Transactions 2017 YTD (3)

Quarterly M&A Volume (3)

Select M&A Transactions (4)

Select Financing Transactions Company

Quarterly Financing Volume (1)(2)

Amount ($MM)

$Bn

$Bn

54%

$15

$13

$12

$2,500.0

$9

$9

$6

$6

$349.7

$3

$10

$6

$5

$4

$6

Quarterly M&A Deal Count (3)

72

86

143

127 103 111

123

$3.9

40 30

94

24

20

60

10

30

29

27

24

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

15

13

(

)

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

Last 12 Months Software Price Performance vs. S&P 500 (5) 30.0%

M&A EV/ NTM Rev. Over Time (6) 27.3%

`

25.0% 20.0% 15.1%

15.0% 10.0% 5.0%

0.0% (5.0%)

2

$3.3

23

7

35.0%

SPX

27

0

0

$25.0

$6.1

34% 118

120 90

(Software Business Division)

50

150

$25.0

$8.7 $11

$8.7

20% 180

$50.0

$15 $7

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

Quarterly Financing Deal Count (1)(2)

$54.0

$15

$5

$0 Q1'15Q2'15Q3'15Q4'15Q1'16Q2'16Q3'16 Q4'16Q1'17 TD

EV ($Bn) $26.2

$24

$14

$20 $10

Acquirer

$41

$30

$0

$80.0

Target $50

$50

$40

$3

$85.8

94%

$60

IGV

Notes: Source: Capital IQ, PitchBook, and Dow Jones VentureSource. Market Data as of 03/24/2017. 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.

$2.8 $2.4

RECENT STOCK PERFORMANCE Index Performance

Last 12 Months

Last 3 Years

40%

40% 30%

30%

20%

20%

10%

0% Mar-14 (10%)

10% 0% Mar-16 Apr-16 May-16 Jun-16

Jun-14

Sep-14

Dec-14 Mar-15

Jun-15

Sep-15

Dec-15 Mar-16

(20%)

Jul-16 Aug-16 Sep-16 Oct-16 Nov-16 Dec-16 Jan-17 Feb-17 Mar-17 (30%)

(10%)

(40%)

(20%)

(50%)

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

3

3 Months

1 Year

3 Years

5% 7% 11% 14% 10% 12%

15% 33% 19% 30% 18% 17%

31% 5% 17% 28% (17%) 13%

Notes: Source: Capital IQ. Market Data as of 03/24/2017. BI & Analytics: ATTU, DATA, DWCH, FICO, GSUM, HDP, MSTR, SPLK, TDC, VRNT. Infrastructure: ATEN, CA, CTXS, CVLT, FFIV, LOGM, MCRO, NEWR, NOW, NTCT, NTNX, PRGS, PSTG, RHT, SOW, SPLK, TEAM, VMW. Platform: GOOGL, IBM, MSFT, ORCL, RHT, SAP. SaaS / On Demand: AMBR, APTI, AZPN, BCOV, BLKB, BNFT, BOX, BV, CALD, CARB, COUP, COVS, CRM, CSLT, CSOD, ECOM, FIVN, HUBS, INST, JCOM, JIVE, LOGM, LPSN, MIME, MRIN, NEWR, NOW, PAYC, PCTY, PCYG, QLYS, RNG, RP, SHOP, SPSC, TNGO, TWOU, ULTI, VEEV, WDAY, WK, 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.

Jun-16

Sep-16

Dec-16 Mar-17

TRADING COMPARABLES Valuation Metrics

EV / 2016E Revenue

EV / 2016E EBITDA

7.0x

6.0x

45.0x

5.8x

40.0x

5.4x 4.9x

5.0x

4.8x

37.6x

35.0x

4.3x

4.0x

3.6x

29.0x

30.0x

24.6x

25.0x 3.0x

18.5x

20.0x 2.0x

10.0x

0.0x

5.0x SaaS / On Demand

4

14.3x

15.0x

1.0x

17.0x

Infrastructure

Platform

Vertical

Security

BI & Analytics

SaaS / On Demand

Notes: Source: Capital IQ. Market Data as of 03/24/2017. Figures represent mean values of respective comp groups. BI & Analytics: ATTU, DATA, DWCH, FICO, GSUM, HDP, MSTR, SPLK, TDC, VRNT. Infrastructure: ATEN, CA, CTXS, CVLT, FFIV, LOGM, MCRO, NEWR, NOW, NTCT, NTNX, PRGS, PSTG, RHT, SOW, SPLK, TEAM, VMW. Platform: GOOGL, IBM, MSFT, ORCL, RHT, SAP. SaaS / On Demand: AMBR, APTI, AZPN, BCOV, BLKB, BNFT, BOX, BV, CALD, CARB, COUP, COVS, CRM, CSLT, CSOD, ECOM, FIVN, HUBS, INST, JCOM, JIVE, LOGM, LPSN, MIME, MRIN, NEWR, NOW, PAYC, PCTY, PCYG, QLYS, RNG, RP, SHOP, SPSC, TNGO, TWOU, ULTI, VEEV, WDAY, WK, 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.

Vertical

Security

Platform

Infrastructure BI & Analytics

TRADING COMPARABLES Operational Metrics

2017 / 2016 Rev. Growth

2016 EBITDA Margin

25%

20%

35%

30%

19% 15%

15%

29% 24%

25% 15%

14%

21%

14%

10%

10%

20%

20%

17%

16%

15%

10% 5% 5% 0%

0% SaaS / On Demand

5

Security

BI & Analytics Infrastructure

Vertical

Platform

Platform

Notes: Source: Capital IQ. Market Data as of 03/24/2017. Figures represent mean values of respective comp groups. BI & Analytics: ATTU, DATA, DWCH, FICO, GSUM, HDP, MSTR, SPLK, TDC, VRNT. Infrastructure: ATEN, CA, CTXS, CVLT, FFIV, LOGM, MCRO, NEWR, NOW, NTCT, NTNX, PRGS, PSTG, RHT, SOW, SPLK, TEAM, VMW. Platform: GOOGL, IBM, MSFT, ORCL, RHT, SAP. SaaS / On Demand: AMBR, APTI, AZPN, BCOV, BLKB, BNFT, BOX, BV, CALD, CARB, COUP, COVS, CRM, CSLT, CSOD, ECOM, FIVN, HUBS, INST, JCOM, JIVE, LOGM, LPSN, MIME, MRIN, NEWR, NOW, PAYC, PCTY, PCYG, QLYS, RNG, RP, SHOP, SPSC, TNGO, TWOU, ULTI, VEEV, WDAY, WK, 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.

Infrastructure BI & Analytics

Security

Vertical

SaaS / On Demand

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

3/24/2017

Value

Debt

Value

$835.14 $64.98 $44.65 $173.83 $98.04 $82.96

$577,432 502,135 183,720 163,959 117,511 14,791

($82,398) (33,399) (5,385) 33,649 4,204 (555)

$495,034 468,736 178,335 197,608 121,715 14,236 Mean Median

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

$91.73 $82.96 $84.81 $31.86 $83.14 $146.57 $60.90 $29.43 $27.40 $96.15 $37.25 $39.62 $19.50 $49.10 $9.90 $36.44 $28.03 $9.18

$37,485 14,791 14,079 13,317 12,999 9,496 8,262 6,547 6,286 5,055 3,419 3,027 2,793 2,213 1,979 1,923 1,366 627

($6,485) (555) (392) (739) (336) (974) (984) (795) 1,613 (166) (60) (91) (355) (437) (547) (196) (115) (114)

$31,000 14,236 13,688 12,578 12,663 8,522 7,278 5,752 7,899 4,888 3,359 2,936 2,438 1,776 1,432 1,728 1,251 513 Mean Median

6

Notes: Source: Capital IQ and Wall Street Estimates. Multiples 100 considered NM. Negative margins considered NM. Market Data as of 03/24/2017.

AV / Revenue CY 16E

AV / EBITDA

CY 17E

CY 16E

CY 17E

Operating Metrics Price / EPS CY 16E

CY Rev. Growth

CY 17E

16E/15A

17E/16E

EBITDA Margin CY 16E

CY 17E

5.5x 5.5 4.8 2.5 5.2 6.1

4.7x 4.7 4.7 2.5 4.7 5.4

16.6x 16.9 12.2 10.7 19.1 35.7

11.5x 12.6 10.5 10.1 13.7 20.4

30.0x 30.6 21.3 14.0 30.5 63.3

20.1x 21.4 16.3 12.6 21.5 33.1

20.4% (2.7%) (0.6%) (2.2%) 3.1% 17.9%

17.6% 17.0% 2.3% (1.6%) 10.2% 12.7%

33.1% 32.4% 39.2% 23.2% 27.4% 17.1%

40.6% 37.1% 44.6% 24.8% 34.7% 26.6%

4.9x 5.3

4.5x 4.7

18.5x 16.7

13.1x 12.0

31.6x 30.3

20.8x 20.7

6.0% 1.2%

9.7% 11.4%

28.7% 29.9%

34.7% 35.9%

4.4x 6.1 9.8 3.1 3.7 4.2 7.7 10.8 5.8 14.5 3.0 3.2 4.0 2.8 2.0 7.1 3.1 2.2

4.1x 5.4 7.4 3.1 4.5 3.9 6.1 8.2 5.6 4.9 2.7 3.0 2.8 2.6 1.4 5.5 3.2 2.0

16.8x 35.7 NM 9.8 12.3 14.0 NM NM 12.5 NM 29.8 10.7 NM NM NM NM 11.5 NM

11.1x 20.4 34.3 8.1 12.6 10.0 53.1 40.3 11.8 14.4 10.1 9.7 NM 19.9 NM NM 9.0 25.3

33.0x 63.3 NM 17.0 24.4 26.5 NM NM 16.4 NM NM 20.4 NM NM NM NM NM NM

18.9x 33.1 78.7 13.5 17.9 17.2 NM 83.1 15.3 25.6 17.8 14.9 NM 48.6 NM NM 16.9 81.4

6.7% 17.9% 38.3% (0.1%) 4.4% 3.9% 42.1% 37.2% 9.2% 23.7% 43.1% (2.9%) 83.4% 8.7% 65.3% 49.6% 7.4% 15.6%

6.7% 12.7% 32.2% (0.8%) (17.2%) 7.9% 25.6% 31.7% 3.5% 5.6% 9.5% 5.3% 42.0% 5.3% 36.1% 30.5% (3.5%) 13.2%

26.1% 17.1% NM 31.8% 30.0% 30.2% NM NM 46.6% 12.2% 10.0% 29.8% NM 2.7% NM NM 26.9% NM

36.9% 26.6% 21.7% 39.0% 35.6% 39.1% 11.5% 20.4% 47.8% 33.9% 26.9% 31.3% NM 13.3% NM NM 35.4% 7.8%

5.4x 4.1

4.3x 4.0

17.0x 12.5

19.3x 12.6

28.7x 24.4

34.5x 18.4

25.2% 16.8%

13.7% 8.7%

23.9% 26.9%

28.5% 31.3%


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. Barracuda Networks, Inc. Mimecast Limited SecureWorks Corp. Rapid7, Inc. 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

3/24/2017

Value

Debt

Value

$30.47 $103.38 $111.77 $60.90 $36.30 $43.82 $73.37 $12.28 $48.78 $40.60 $35.70 $23.04 $21.51 $11.56 $14.45 $3.50 $12.90 $4.40 $4.63 $5.53 $5.84 $1.17

$18,856 18,081 10,287 8,262 6,364 6,009 3,177 2,180 1,679 1,358 1,298 1,216 1,186 933 615 547 514 393 248 216 187 77

$1,563 (1,373) (842) (984) (1,086) (1,153) (30) (194) (275) (261) (244) (190) (100) (111) (72) (98) (144) (90) (26) (38) (9) (16)

$20,419 16,708 9,445 7,278 5,279 4,856 3,147 1,986 1,404 1,097 1,054 1,026 1,086 822 543 449 369 302 222 178 179 61 Mean Median

7


AV / Revenue CY 16E

AV / EBITDA

CY 17E

CY 16E

CY 17E


CY Rev. Growth

CY 17E

16E/15A

17E/16E


CY 17E

5.4x 9.6 6.0 7.7 4.1 4.3 8.4 2.8 6.5 4.1 5.3 3.0 6.3 1.9 3.4 2.7 1.9 1.8 3.7 2.0 1.6 1.0

4.0x 8.9 5.0 6.1 3.6 3.7 6.4 2.7 5.2 3.5 4.7 2.8 5.1 1.7 2.8 2.4 2.0 1.7 3.4 1.8 1.5 0.9

23.3x 19.3 NM NM 55.1 12.4 NM NM 33.1 NM 22.0 29.4 NM NM NM 18.8 22.8 NM 18.6 16.0 NM NM

8.5x 16.6 21.7 53.1 17.7 11.1 59.8 76.4 21.7 40.1 14.6 14.1 65.7 NM NM 23.4 23.5 NM 12.4 19.1 14.3 NM

NM 24.7 NM NM NM 28.6 NM NM 62.5 NM 71.4 NM NM NM NM 33.2 48.5 NM 42.7 NM NM NM

19.5x 20.0 40.7 NM 40.8 26.5 NM NM 39.3 NM 42.2 31.4 NM NM NM 52.1 46.9 NM 16.9 84.9 19.0 NM

4.2% 6.8% 36.3% 42.1% 26.4% 9.3% 41.5% 14.6% 34.7% 12.9% 20.5% 12.5% 26.1% 26.0% 42.4% 4.2% (20.4%) 9.8% 9.9% (4.2%) 3.3% 1.1%

34.5% 7.4% 21.4% 25.6% 16.1% 17.1% 31.1% 1.3% 24.1% 19.8% 14.4% 6.4% 25.3% 14.7% 24.1% 9.9% (3.3%) 11.2% 9.5% 10.0% 4.6% 11.2%

23.2% 49.7% NM NM 7.5% 34.5% NM NM 19.6% NM 24.2% 10.0% NM NM NM 14.3% 8.4% NM 19.8% 12.6% NM NM

47.1% 53.9% 22.9% 11.5% 20.1% 33.1% 10.7% 3.6% 24.0% 8.6% 32.0% 19.7% 7.7% NM NM 10.5% 8.5% NM 27.3% 9.6% 10.8% NM

4.3x 3.9

3.6x 3.4

24.6x 22.0

28.5x 20.4

44.5x 42.7

36.9x 39.3

16.4% 12.7%

15.3% 14.5%

20.3% 19.6%

20.1% 15.6%


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

8

Trading Statistics

Price

Equity

Net

Aggregate

3/24/2017

Value

Debt

Value

$81.61 $82.95 $84.81 $49.57 $68.98 $190.39 $96.15 $57.27 $83.75 $76.14 $54.94 $34.85 $26.86 $38.91 $60.55 $16.37 $26.95 $36.44 $35.02 $37.66 $20.90 $35.70 $23.88 $21.51

$57,739 16,839 14,079 6,799 6,223 5,647 5,055 4,357 4,036 3,535 3,268 2,821 2,606 2,205 2,189 2,088 2,008 1,923 1,801 1,779 1,332 1,298 1,194 1,186


$501 (1,462) (392) (519) (395) (80) (166) 0 657 326 (30) 17 (225) (64) (113) (102) (145) (196) (82) (161) (185) (244) (202) (100)

$58,240 15,377 13,688 6,280 5,827 5,567 4,888 4,357 4,692 3,861 3,238 2,839 2,381 2,141 2,076 1,986 1,863 1,728 1,719 1,618 1,147 1,054 992 1,086

AV / Revenue CY 16E 6.9x 9.8 9.8 11.5 15.0 7.1 14.5 9.2 5.4 5.3 9.8 5.0 7.6 5.1 7.7 5.0 4.9 7.1 6.5 7.9 5.5 5.3 7.4 6.3

AV / EBITDA

CY 17E 5.7x 7.6 7.4 9.5 9.7 5.7 4.9 9.0 4.1 4.9 7.6 4.2 5.7 4.5 5.9 3.9 3.9 5.5 5.2 6.0 4.7 4.7 5.9 5.1

CY 16E NM NM NM 51.6 NM 82.4 NM 19.7 12.7 31.0 47.6 34.9 NM NM NM NM NM NM NM NM NM 22.0 NM NM

CY 17E 26.8x 56.9 34.3 31.2 NM 23.8 14.4 19.2 9.8 20.5 28.2 17.3 NM 41.3 NM NM 62.0 NM 36.4 NM 38.1 14.6 NM 65.7

Operating Metrics Price / EPS CY 16E NM NM NM NM NM NM NM 33.2 26.8 86.5 74.5 NM NM NM NM NM NM NM NM NM NM 71.4 NM NM

CY Rev. Growth

CY 17E 63.2x NM 78.7 62.5 NM 48.0 25.6 30.6 14.3 35.7 54.0 37.8 NM NM NM NM NM NM 75.7 NM 65.5 42.2 NM NM

16E/15A 25.9% 35.0% 38.3% 32.9% 89.7% 26.4% 23.7% 1.7% 21.3% 14.6% 46.5% 21.3% 49.4% 24.6% 48.9% 31.7% 28.2% 49.6% 40.8% 37.1% 19.4% 20.5% 59.9% 26.1%

17E/16E 21.3% 28.9% 32.2% 21.0% 53.9% 24.0% 5.6% 2.6% 32.1% 7.8% 28.7% 18.8% 34.6% 13.7% 29.9% 26.2% 27.4% 30.5% 25.6% 30.9% 17.9% 14.4% 26.1% 25.3%

EBITDA Margin CY 16E 6.0% NM NM 22.4% NM 8.7% 12.2% 46.7% 42.3% 17.1% 20.7% 14.3% NM NM NM NM NM NM 2.7% NM NM 24.2% NM NM

CY 17E 21.3% 13.4% 21.7% 30.5% 0.1% 24.2% 33.9% 46.8% 41.4% 23.9% 27.1% 24.3% 2.9% 10.8% 1.0% NM 6.2% NM 14.3% 3.4% 12.3% 32.0% NM 7.7%


Trading Statistics

Price

Equity

Net

Aggregate

3/24/2017

Value

Debt

Value

CY 16E

AV / EBITDA

CY 17E

CY 16E

CY 17E


CY Rev. Growth

CY 17E

16E/15A

17E/16E


CY 17E

SaaS / On Demand (cont'd) Five9, Inc. SPS Commerce, Inc. Benefitfocus, Inc. Instructure, Inc. Workiva Inc. Carbonite, Inc. Apptio, Inc. LivePerson, Inc.

$18.52 $56.48 $26.75 $24.00 $15.10 $19.30 $11.79 $6.75

$989 970 822 688 623 543 453 394

($12) (139) 42 (68) (42) (59) (79) (51)

$977 831 864 619 581 484 374 343

6.0x 4.3 3.7 5.6 3.3 2.3 2.3 1.5

5.2x 3.8 3.2 4.1 2.8 2.0 2.1 1.7

NM 44.1 NM NM NM 34.2 NM 38.3

NM 26.0 56.4 NM NM 8.2 NM 18.3

NM NM NM NM NM NM NM NM

NM 68.9 NM NM NM 25.7 NM 76.4

25.8% 21.9% 26.0% 51.5% 23.0% 51.5% 24.2% (6.8%)

16.4% 14.3% 14.0% 35.6% 14.5% 15.6% 12.0% (8.1%)

1.1% 9.8% NM NM NM 6.8% NM 4.0%

5.0% 14.4% 5.8% NM NM 24.7% NM 9.1%

Bazaarvoice, Inc. Jive Software, Inc. Castlight Health, Inc. Brightcove Inc. ChannelAdvisor Corporation Park City Group, Inc. Amber Road, Inc. Tangoe, Inc. Covisint Corporation Marin Software Incorporated

$4.25 $4.35 $3.20 $9.05 $10.85 $11.95 $7.66 $5.04 $2.00 $1.75

352 344 337 308 285 232 207 199 82 69

(46) (109) (115) (36) (62) (9) 7 (32) (30) (31)

305 236 223 272 223 223 214 167 51 38

1.5 1.2 2.2 1.8 2.0 13.6 2.9 0.7 0.7 0.4

1.5 1.2 1.8 1.7 1.8 NA 2.6 NA NA 0.4

NM NM NM NM NM 63.9 NM 6.8 NM NM

18.2 10.7 NM 31.4 33.5 NA NM NA NA NM

NM NM NM NM NM NM NM 13.1 NM NM

NM 41.4 NM 94.3 NM NA NM NA NA NM

2.2% 4.2% 35.0% 11.6% 12.5% 21.6% 9.0% NA (10.4%) (8.0%)

1.7% (0.1%) 19.8% 9.1% 9.0% NA 11.9% NA NA (11.9%)

NM NM NM NM NM 21.3% NM 10.6% NM NM

8.2% 10.8% NM 5.3% 5.4% NA NM NA NA NM

5.8x 5.3

4.5x 4.7

37.6x 34.9

29.7x 26.8

50.9x 52.3

52.3x 51.0

27.0% 25.8%

18.8% 18.8%

15.9% 12.2%

16.3% 12.9%

Mean Median

9

AV / Revenue



Trading Statistics

Price

Equity

Net

Aggregate

3/24/2017

Value

Debt

Value

AV / Revenue CY 16E

AV / EBITDA

CY 17E

CY 16E

Operating Metrics Price / EPS

CY 17E

CY 16E

CY Rev. Growth

CY 17E

16E/15A

17E/16E


CY 17E

Business Intelligence & Analytics Splunk Inc.

$60.90

$8,262

($984)

$7,278

7.7x

6.1x

NM

53.1x

NM

NM

42.1%

25.6%

NM

11.5%

Teradata Corporation Fair Isaac Corporation

$30.30 $126.85

3,966 3,940

(406) 533

3,560 4,472

1.5 5.0

1.7 4.8

9.4 21.6

8.7 17.9

31.9 32.0

21.3 24.3

(8.2%) 6.1%

(8.5%) 4.4%

16.4% 23.0%

19.2% 26.6%

Tableau Software, Inc.

$48.41

3,778

(909)

2,870

3.5

3.3

NM

53.3

NM

NM

26.5%

6.7%

NM

6.1%

$40.40 $186.14

2,532 2,129

442 (589)

2,974 1,539

2.8 3.0

2.6 2.9

12.8 13.3

11.5 10.8

16.3 23.6

14.8 24.4

(5.5%) (3.3%)

5.8% 2.6%

21.7% 22.6%

22.9% 27.0%

Verint Systems Inc. MicroStrategy Incorporated Hortonworks, Inc. Gridsum Holding Inc. Attunity Ltd. Datawatch Corporation

$9.31

581

(85)

495

2.7

2.1

NM

NM

NM

NM

51.3%

29.0%

NM

NM

$12.34 $7.64

367 129

(76) (9)

291 120

5.0 2.2

3.2 1.9

NM NM

55.8 17.8

NM NM

99.5 46.3

59.4% 13.1%

57.9% 15.2%

NM NM

5.7% 10.7%

$8.30

100

(26)

73

2.3

2.1

NM

NM

NM

NM

4.4%

10.9%

NM

NM

3.6x 2.9

3.1x 2.8

14.3x 13.1

28.6x 17.8

25.9x 27.7

38.5x 24.4

18.6% 9.6%

14.9% 8.8%

20.9% 22.2%

16.2% 15.3%

Mean Median Vertical Cerner Corporation

$57.77

$19,048

$207

$19,255

4.1x

3.7x

14.6x

11.3x

31.2x

23.2x

8.2%

10.1%

27.9%

32.9%

$488.63

10,355

(11)

10,344

4.9

4.3

25.4

16.7

50.1

21.9

15.6%

12.2%

19.2%

26.0%

SS&C Technologies Holdings, Inc.

$35.61

7,234

2,384

9,617

6.5

5.8

18.7

13.7

55.6

18.5

48.1%

12.8%

34.7%

41.9%

Veeva Systems Inc.

$49.57

6,799

(519)

6,280

11.5

9.5

51.6

31.2

NM

62.5

32.9%

21.0%

22.4%

30.5%

$108.60 $55.47

4,292 4,102

144 (583)

4,435 3,519

4.1 7.8

3.4 6.6

41.4 NM

14.4 41.0

NM NM

44.1 81.8

17.1% 13.6%

19.0% 17.8%

9.9% 4.3%

23.9% 16.2%

Blackbaud, Inc.

$76.14

3,535

326

3,861

5.3

4.9

31.0

20.5

86.5

35.7

14.6%

7.8%

17.1%

23.9%

Ellie Mae, Inc. CoreLogic, Inc.

$98.14 $39.16

3,314 3,310

(422) 1,532

2,892 4,842

8.0 2.5

6.6 2.6

39.5 11.5

19.9 10.3

85.3 31.8

52.0 17.3

41.9% 27.8%

21.8% (4.8%)

20.3% 21.5%

33.2% 25.2%

Medidata Solutions, Inc.

$55.97

3,231

(111)

3,120

6.7

5.7

47.6

23.3

NM

45.0

18.1%

19.0%

14.1%

24.2%

RealPage, Inc.

$34.85

2,821

17

2,839

5.0

4.2

34.9

17.3

NM

37.8

21.3%

18.8%

14.3%

24.3%

Allscripts Healthcare Solutions, Inc.

$11.98

2,163

1,235

3,397

2.2

2.0

22.3

9.6

NM

19.2

11.8%

11.0%

9.8%

20.6%

WebMD Health Corp.

$50.32

1,854

54

1,908

2.7

2.7

10.1

8.0

25.6

24.9

10.8%

1.9%

26.7%

33.0%

Inovalon Holdings, Inc. AppFolio, Inc.

$11.75 $25.70

1,739 867

(306) (26)

1,433 841

3.4 8.0

3.2 6.1

19.3 NM

13.6 60.7

65.4 NM

39.3 NM

(2.2%) 40.8%

4.0% 30.1%

17.3% NM

23.8% 10.1%

HealthStream, Inc.

$22.73

722

(103)

619

2.7

2.5

29.4

17.3

NM

NM

8.1%

11.8%

9.3%

14.2%

Instructure, Inc. Silver Spring Networks, Inc.

$24.00 $10.56

688 560

(68) (118)

619 442

5.6 1.4

4.1 1.4

NM NM

NM 27.4

NM NM

NM 56.8

51.5% (36.5%)

35.6% 3.2%

NM NM

NM 5.0%

$3.20

337

(115)

223

2.2

1.8

NM

NM

NM

NM

35.0%

19.8%

NM

NM

$12.92

192

(22)

171

2.3

2.2

38.1

29.4

NM

NM

10.9%

4.9%

6.2%

7.6%

4.8x 4.5

4.2x 3.9

29.0x 29.4

21.4x 17.3

54.0x 52.9

38.7x 37.8

19.5% 16.4%

13.9% 12.5%

Constellation Software Inc.

athenahealth, Inc. Guidewire Software, Inc.

Castlight Health, Inc. Exa Corporation

Mean Median

10


17.2% 17.2%

23.1% 24.1%

PUBLIC SAAS COMPANIES – VALUATION CORRELATION TO GROWTH AND CASH FLOW

11.0x

R = 0.80

Enterprise Value / CY 2017E Revenue

VEEV AZPN

9.0x

PAYC

WDAY

NOW

7.0x COUP

TWOU

FIVN

5.0x CSOD

SPSC

BNFT AMBR LPSN

(10.0%)

0.0% (1.0x)

BLKB INST

HUBS NEWR LOGM CALD

ULTI PCTY

BOX RNG

ZEN MIME QLYS

CRM

RP

JIVE

CSLT APTI BV BCOV ECOM

10.0%

20.0%

CARB

30.0%

40.0%

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

11

SPLK

WK

3.0x

1.0x

SHOP

Notes: Sources: Capital IQ as of 03/24/2017. Consensus Estimates used for CY17E figures. When analyzing the same data set, R value of 2017E Revenue Multiple and 2017E Revenue Growth % is 0.63. When analyzing the same data set, R value of 2017E Revenue Multiple and 2017E FCF Margin % is 0.41. Estimates for COVS, TNGO and PCYG are not available.

50.0%

60.0%

PUBLIC SAAS COMPANIES – VALUATION CORRELATION TO S&M EFFECTIVENESS

Enterprise Value / CY 2016E Revenue

12.0x

VEEV

10.0x

NOW

WDAY

R = 0.58

PAYC

AZPN (-0.1x) SPLK TWOU

8.0x

ZEN HUBS

CRM

MIME 6.0x

NEWR

FIVN INST QLYS RNG

ULTI PCTY

CALD CSOD BOX

4.0x

BLKB

JCOM RP

SPSC

AMBR 2.0x

COUP

WK

ECOM LPSN (-0.2x) BV JIVE

APTI

CARB CSLT

BCOV

TNGO

MRIN (-0.3x) 0.0

BNFT

0.2

0.4

0.6

0.8

1.0

1.2

1.4

Annual Change in Revenue (CY16E) / LTM Sales and Marketing Expense 12

Notes: Sources: Capital IQ as of 03/24/2017. Consensus Estimates used for CY16E Revenue figures and GAAP figures used for Sales and Marketing Expense. For Tangoe, CIQ Consensus Estimate used for CY15 Revenue since no actual Revenue figure was reported for that period. SaaS companies with Annual Change in Revenue (CY16E) / LTM Sales and Marketing Expense less than or equal to 0.0 placed at 0.0 x-axis position and excluded from R calculation (AZPN, LPSN, MRIN). The Annual Change in Revenue (CY16E) / LTM Sales and Marketing Expense for these companies are provided in parenthesis. Estimates for COVS and PCYG are not available.

1.6

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

AV / Revenue

Aggregate

Date

Acquirer

Target

Target Sector

Value (AV)

LTM

NTM

Target Description

Application Software

$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

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

Enterprise Networking

$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

3/21/17

(

3/20/17

)

(

)

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

(

)

2/9/17

Nokia Corporation

Comptel Corporation

Carrier Infrastructure

$359

3.4x

3.0x

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

$65

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

(

2/1/17

1/31/17

13

Fingerprint Cards AB

)

Delta ID Inc.

(

(

)

)

Notes: Source: Capital IQ and Wall Street Estimates. Reflects M&A activity through 03/24/2017. Transactions highlighted in yellow denote Private Equity Acquirers.


Aggregate

Date

Acquirer

Target

Target Sector

AV / Revenue LTM

NTM

Target Description

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

1/24/17

Infrastructure Management

$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

Information Management

$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

1/20/17

(

)

1/19/17

(

)

12/20/16

(

(

)

(

)

)

12/12/16

(

14

Value (AV)

)


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

Aggregate Acquirer

Target

Target Sector

Value (AV)

AV / Revenue LTM

NTM

Security

$850

4.0x

NA


$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

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


$854

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

12/9/16 (Identity Management Business)

12/7/16

/

(Public Sector & K-12 Education Businesses) (1)

12/6/16

(

)

12/6/16

(

)

11/30/16

(

15

Target Description

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

)

Notes: Source: Capital IQ and Wall Street Estimates. Reflects M&A activity through 03/24/2017. Transactions highlighted in yellow denote Private Equity Acquirers. (1) Aggregate Value represents the majority stake being acquired by KKR. The Blackstone Group will maintain a minority stake.

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

Aggregate Acquirer

Target

AV / Revenue

Target Sector

Value (AV)

LTM

NTM

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

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

Enterprise Networking

$1,254

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


$1,620

2.7x

NA

EMC's Enterprise Content Division, which provides enterprise content management SaaS and on-premise software, including the Documentum, InfoArchive, and LEAP product lines, for businesses and corporations

API Management SaaS

$562

6.1x

5.0x

Provides API management SaaS for businesses globally. Software enables the integration, interfacing and management of third-party applications and services for software developers creating branded mobile and cloud applications

9/29/16

( 9/26/16

)

(

)

9/22/16

(

)

9/20/16

9/19/16 (Technology As sets)

9/19/16

9/12/16 (ECM Bus iness)

9/8/16

16


Target Description


AV / Revenue

Aggregate

Date

Acquirer

Target

Target Sector

Value (AV)

LTM

NTM

Security Software

$6,078

NA

NA

Security Software

$8,730

2.8x

NA

HPE's software business division, which provides systems management, storage management, content management, applications development, imaging and virtualization management software for enterprises

8/31/16


$1,402

3.4x

3.1x

Provides VoIP, unified communications, PBX and call center management software and software-as-a-service (SaaS) for businesses globally. Also provides managed communications and disaster recovery services

8/18/16

Internet Software & Services

$122

3.9x

NA

Provides online content management SaaS for Web publishers in the medical, scientific, technical and media industries worldwide. Also provides online hosting of journalistic content


$80

5.3x

NA

Provides project and portfolio management (PPM), application portfolio management (APM) and predictive portfolio analysis (PPA) SaaS for the healthcare, government, education and commercial sectors

8/1/16


$582

NA

NA

Provides team collaboration and document management SaaS for businesses. The company’s solutions are used in various platforms, such as iPad and iPhone, Macs, PCs, Windows, Apple watches, Android phones, Android tablets, and on the Web

8/1/16

Systems Software

$2,184

7.0x

5.8x

Provides GPS-based vehicle tracking and mobile workforce management SaaS for service-based businesses and the construction industry globally

7/28/16


$8,709

9.7x

7.7x

Provides financial management and planning, ERP, e-commerce, CRM, SCM, and business intelligence (BI) analytics software as a service (SaaS) for businesses globally


$1,009

1.9x

1.9x

Provides e-discovery and document review software for businesses, the legal sector and government agencies globally. Also provides a searchable online database of Chapter 7, 11 and 13 bankruptcy court filings and outsourced ediscovery and class-action lawsuit claims

7/26/16


$1,800

NA

NA

The GoTo businesses of Citrix Systems provides Web conferencing and real-time team collaboration SaaS for small- to medium-sized businesses

7/21/16


$215

NA

3.6x

Provides customer engagement and customer analytics SaaS for businesses in the telecom, insurance, finance, travel, hospitality and retail sectors

7/21/16


$130

14.4x

NA

Provides marketing automation, customer analytics, and sales management SaaS for retailers. Software enables marketers to collect and deliver user generated content (UGC) from various mediums

Median

4.0x

11.1x

Mean

6.2x

4.0x

Median

3.1x

2.3x

Mean

5.1x

2.5x

9/7/16

(

)

9/7/16 (Software Business Division)

8/1/16

7/27/16

(

)

/

All Software

PE

17

Target Description

Provides network anti-malware and PC security software for consumers and enterprises worldwide. Software includes features for anti-virus, anti-spyware, anti-spam, intrusion prevention, secure messaging, Web filtering and vulnerability management


RECENT PRIVATE FINANCINGS ($MM)

18

Deal Date

Company

Amount Raised

3/23/17

DataRobot

$54

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

3/23/17

Kuaishou Technology

$350

Developer of a video sharing and live streaming platform.

3/23/17

Lystable

$21

Provider of a vendor management platform.

3/23/17

Shenzhen Qianhai Dadao Financial Services

$29

Operator of a real estate financing service platform designed to facilitate second-hand property transactions.

China Renaissance, Pacific Alliance Group, Sequoia Capital China

3/23/17

Zenreach

$30

Developer of a modern marketing platform designed to provide CRM and marketing automation services for offline businesses.

8VC, Ashton Kutcher, Kevin Durant, Maverick Ventures, Bain Capital Ventures, First Round Capital, Founders Fund, SV Angel

3/22/17

Avaloq

$350

Developer of banking software systems.

3/22/17

HotelTonight

$37

Provider of a hotel booking platform created to make last minute online bookings for hotels.

3/20/17

CloudCheckr

$50

Developer of a cloud cost management platform designed for AWS (Amazon web services) Security and Cost Management.

3/17/17

Mychebao

$100

Operator of an used-car online auction platform created to simplify the car-trading experience in China.

3/16/17

DraftKings

$119

Provider of a skill-based daily fantasy sports (DFS) platform designed to engage interactive experience and daily excitement to the pastime of fantasy sports.

3/15/17

Instacart

$413

Provider of a goods delivery application designed to order and secure delivery of groceries from local stores.

3/15/17

Knime

$21

Provider of open-source enterprise software intended to access to advanced data science.

3/15/17

Pindrop Security

$86

Developer of phone fraud detection and call center authentication technology designed to provide real time identity and security on every voice communication and voice device.

3/15/17

ServiceTitan

$80

Developer of a cloud-based service management software designed to build a business to serve home services contractors.

3/14/17

Evrythng

$25

Provider of a software platfrom for creating profiles of physical objects on Web.

Brief Description

Notes: Source: Pitchbook. Reflects deal activity through 03/24/2017. Transactions reflect recent Software Venture and Private Equity Growth / Expansion activity where the amount raised was greater than or equal to $20MM.

Investors

New Enterprise Associates

Tencent

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

NA

Altimeter Capital Management, RSC Capital, Accel, Aspect Venture Partners, Battery Ventures, Coatue Management, First Round Capital, GGV Capital, US Venture Partners

Level Equity

Pacific Alliance Group

Eldridge Industries Wellcome Trust, Andreessen Horowitz, FundersClub, Initialized Capital, Khosla Ventures, Kleiner Perkins Caufield & Byers, Sequoia Capital, Thrive Capital, Valiant Capital Partners, Y Combinator Invus Group

CapitalG, John Chambers, Andreessen Horowitz, Citi Ventures, Felicis Ventures, GV, IVP

ICONIQ Capital Accelerate-IT Ventures, Bloc Ventures, Generation Ventures, Advance Vixeid Partners, Atomico Uk Partners, BHLP, Cisco Investments, Dawn Capital, Samsung Venture Investment


19

Deal Date

Company

Amount Raised

Brief Description

Investors

3/14/17

Icertis

$25

Provider of a cloud-based easy-to-use enterprise contract management platform designed to control and increase revenue velocity.

B Capital Group, Greycroft Partners

3/14/17

SolarisBank

$28

Provider of an API-based Banking-as-a-Platform (BaaP) designed to integrate banking services for emerging digital-first companies.

Arvato Bertelsmann, SBI Holdings, UniCredit, FinLeap, Hegus, yabeo Capital

3/13/17

Skuid

$25

Developer of a cloud user interface experience (UX) platform designed to give tailored solutions at the speed of business.

ICONIQ Capital, K1 Capital

3/10/17

Canopy Tax

$20

Developer of an online tax workflow management software designed to streamline tax resolution for tax professionals.

3/10/17

JobToday

$35

Developer of an online platform designed to revolutionize the way candidates find jobs and employers hire staff.

3/9/17

Airbnb

$1,003

3/9/17

Viva Republica

$48

Provider of a financial services mobile application designed to simplify payments in Korea. The company's financial platform offers a peer-to-peer mobile money transfer application that enables users to transfer money from their own bank accounts into the recipient's account.

3/8/17

CurrencyCloud

$25

Developer of a foreign exchange payments automation platform designed to remit cross border payments through API.

3/8/17

Veem (US)

$25

Provider of payment service for global commerce designed to simplify global business payments.

3/7/17

Confluent

$50

Provider of a data streaming platform designed to help other companies get easy access to enterprise data as real-time streams.

Sequoia Capital, Benchmark Capital, Index Ventures

3/7/17

Farmer's Business Network

$40

Developer of a decision-support system designed to collect crowd-sourced information from members.

Bow Capital, Acre Venture Partners, DBL Partners, GV, Kleiner Perkins Caufield & Byers

3/3/17

24tidy

$22

Operator of a laundry service platform in China. The company's laundry service platform enables users to schedule pickup and drop-off of laundry and dry cleaning items at any time in over ten cities in China.

3/3/17

Paytm E-Commerce

$200

Operator of an e-commerce platform in India.

3/3/17

Rubicon Global

$104

Provider of cloud-based sustainable waste and recycling technology and services.

3/2/17

Examity

$21

Developer of a proctoring platform designed for educational institutions.

Operator of an online property rental marketplace designed for short-term travel stays.


Pelion Venture Partners, Deep Fork Capital, EPIC Ventures, New Enterprise Associates

RTL Group, Astremedia, Channel Four Television, German Media Pool

Aventura VC, CapitalG, Technology Crossover Ventures, Andreessen Horowitz, Sequoia Capital

Bessemer Venture Partners, Partech Ventures, Paypal, Altos Ventures, Goodwater Capital

GV, Anthemis Group, Notion Capital, Rakuten, Sapphire Ventures

GV, National Australia Bank, SBI Investment, Kleiner Perkins Caufield & Byers, SVB Capital Partners

China Merchants Group, CITIC Securities, ICH Group

Alibaba Group, SAIF Partners Blake Mycoskie, Claritas Capital, Hammerstone Capital, Henry Kravis, Leonardo DiCaprio, Nima Capital, Paul Tudor Jones II, Stelac Capital Partners, Suez Environnement, The Goldman Sachs Group, Wellington Management Inherent Group, University Ventures


20

Deal Date

Company

Amount Raised

Brief Description

Investors

3/2/17

Hedvig

$22

Developer of a software-defined storage platform designed to improve the economics of storing and managing the world's data.

EDB Investments, Hewlett Packard Pathfinder, Oman Investment Fund, Atlantic Bridge Capital, True Ventures, Vertex Ventures US

3/2/17

Upstart Network

$33

Operator of an online lending marketplace intended to provide personal loans.

3/1/17

Kensho

$50

Provider of cloud-based financial analytics software designed to augment and power decision making throughout the global financial system.

3/1/17

Nearpod

$21

Provider of a SaaS based one-to-one learning platform designed to empower educators to create learning experiences that engage students.

2/27/17

Ola

$330

Developer of a mobile application for transportation designed to integrate city transportation.

2/27/17

Prosper

$59

Provider of a peer to peer lending marketplace.

2/24/17

Cherwell Software

$50

Provider of IT service management platform for small and Fortune 500 companies.

2/23/17

AirMap

$26

Provider of an airspace management platform for drones designed to help create the next frontier of flight.

Airbus Group Ventures, Microsoft Ventures, Qualcomm Ventures, Rakuten, Sony, Yuneec, General Catalyst Partners, Lux Capital

2/23/17

Atzuche

$58

Provider of a P2P car rental and sharing platform.

China Equity International, China Securities International, Hangzhou Financial Investment, China Pacific Insurance, Hearst Ventures, Ivy Capital, Matrix Partners

2/22/17

Anxin Doctor

$29

Provider of a mobile application created to connect doctors with their patients.

2/22/17

EverQuote

$36

Operator of an online auto insurance marketplace designed to simplify the process of choosing insurance policies.

2/22/17

Mailgun

$50

Provider of application programming interface (API) for developers designed to send, receive, track and store email within applications.

2/22/17

Monzo

$24

Developer of a banking application designed to make a bank as smart as a phone.

2/22/17

Prospa

$25

Provider of an online platform designed to lend to small businesses.

2/22/17

Tala

$30

Developer of a mobile-based financial application designed to bring financial access, choice and control to under served people everywhere.


Rakuten, First Round Capital, Khosla Ventures, Third Point Ventures Citigroup, Wells Fargo, Bank of America Merrill Lynch, Breyer Capital, General Catalyst Partners, Goldman Sachs Principal Strategic Investments, JP Morgan Private Equity Fund Services, Morgan Stanley, S&P Global Insight Venture Partners, AGP Miami, GSV Ventures, Krillion Ventures, Reach Capital

DST Global, Sequoia Capital India, SoftBank Capital

NA

Kohlberg Kravis Roberts

IDG Capital Partners, Matrix Partners China, Qiming Venture Partners

Green D Ventures, Oceanic Partners, Savano Capital Partners, Second Alpha Partners, Stratim Capital, T Capital Partners, Link Ventures

Scaleworks, Turn/River Capital, Rackspace US

Orange Digital Ventures, Thrive Capital, Passion Capital

AirTree Ventures

Artha India Ventures, IVP, Ribbit Capital, Collaborative Fund, Data Collective, Female Founders Fund, Lowercase Capital


21

Deal Date

Company

Amount Raised

Brief Description

Investors

2/21/17

VATBox

$20

Provider of business-to-business (B2B) VAT recovery software designed to simplify the laborious VAT recovery process through intelligent knowledge-based automation.

Target Global, Viola Growth

2/21/17

Infor

$2,500

Developer of an enterprise planning software created to provide cloud-based industry specific business applications.

Koch Equity Development

2/21/17

Haoqiao.cn

$26

Provider of an online international hotel searching and booking platform designed to enhance customer experience.

China Merchants Capital, Government of China, Shun Hei Capital

2/20/17

Mobike

$300

Provider of a bike sharing platform in China designed to allow users to locate nearby bikes.

2/17/17

Soundtrack Your Brand

$27

Developer of consumer music streaming software designed for music streaming.

2/17/17

ShineZone

$58

Operator of a Shanghai-based gaming company created to focuses on gaming development and operations in the US and European markets.

2/16/17

MobiTV

$21

Provider of a platform offering content delivery through mobile and broadband networks.

2/16/17

Astro Digital

$23

Provider of a satellite imagery platform designed to change the way one access satellite imagery.

2/15/17

Top Hat

$23

Provider of a web based classroom response platform designed to connect professors with students.

Union Square Ventures, Emergence Capital Partners, Georgian Partners, Golden Venture Partners, iNovia Capital, SoftTech VC, Version One Ventures

2/14/17

Samanage

$20

Provider of a SaaS-based IT service desk and asset management software designed to manage service interactions with employees and customers.

Salesforce Ventures, Carmel Ventures, Gemini Israel Funds, Marker, Vintage Investment Partners

2/13/17

BirdEye

$25

Provider of business reputation marketing platform.

2/13/17

8i

$27

Developer of a software platform that allows users to create and share 3D videos for virtual reality, augmented reality and the web.

Baidu Venture, Hearst Ventures, Seed & Speed Ventures, Time Warner Investments, Verizon Ventures

2/9/17

Evident.IO

$22

Provider of cloud infrastructure security and compliance automation designed to proactively manage public cloud security risk.

GV, Bain Capital Ventures, True Ventures, Venrock

2/9/17

Diyi Chedai

$73

Operator of an online loan-financing platform for the automotive industry.

2/9/17

Demisto

$20

Developer of a incident management platform designed to offer integrated threat intelligence and security orchestration.


Ctrip.com International, Foxconn Technology Group, Huazhu Hotels Group, Temasek Holdings, TPG Capital, Hillhouse Capital Management, Sequoia Capital, Tencent, Warburg Pincus Balderton Capital, Industrifonden, NMT Network, Creandum, HMP Capital, Jorg Mohaupt, Northzone Ventures, PlayNetwork, Spotify, TeliaSonera (Sweden), Wellington Partners Bank Of Ningbo Company, China Fortune Securities, HT Venture Capital, JiuYou Fund, Nord Engine Asset Management Group, Shanshan Venture

Ally Corporate Finance, Oak Investment Partners

Larnabel Enterprises, VP Capital, GVA Capital, Vast Ventures

World Innovation Lab, Trinity Ventures

360 Jinrong, Addor Capital, CreditEase, Southeast University Education Foundation, Tianma Bearing Group Company, Yixing Capital, CITIC Group, Matrix Partners China, Youjin Capital ClearSky Power & Technology Fund, Slack Technologies, Accel Partners


22

Deal Date

Company

Amount Raised

Brief Description

Investors

2/9/17

Evident.IO

$22

Provider of cloud infrastructure security and compliance automation designed to proactively manage public cloud security risk.

GV, Bain Capital Ventures, True Ventures, Venrock

2/9/17

Demisto

$20

Developer of a security operations platform. The company develops an integrated automation software tool which enables users to automatically get alerts if a malicious URL or file is shared in Slack.

ClearSky Power & Technology Fund, Slack Technologies, Accel Partners

2/8/17

Uptake Technologies

$70

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

RevolutionGrowth

2/8/17

HackerOne

$40

Developer of a vulnerability coordination and bug bounty platform created to empower companies to protect consumer data, trust and loyalty.

2/8/17

Fuze

$104

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

2/8/17

CarTrade.com

$55

Operator of an online auto marketplace designed to provide buyers and sellers a structured platform for transacting new and used vehicles.

2/8/17

Book a Tiger

$21

Provider of an online booking platform for cleaning services intended to offer a personal cleaning expert.

Coller Capital, DN Capital, Tamedia, Target Global

2/8/17

Uptake Technologies

$70

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

RevolutionGrowth

2/8/17

CarTrade.com

$55

Operator of an online auto marketplace designed to provide buyers and sellers a structured platform for transacting new and used vehicles.

Temasek Holdings

2/8/17

HackerOne

$40

Developer of a vulnerability coordination and bug bounty platform created to empower companies to protect consumer data, trust and loyalty.

Dragoneer Investment Group, Benchmark Capital, New Enterprise Associates

2/7/17

SpringCM

$25

Provider of cloud based document and contract management platform designed to solve most critical business needs.

Crestline Investors, Foundation Capital

2/7/17

SnapRoute

$25

Developer of a open-source platform designed to change data centers creation and maintenance.

2/7/17

Netwrix

$56

Provider of visibility and governance platform designed to detect insider threats on premises and in the cloud.

2/7/17

Exabeam

$30

Provider of an analytics-led security intelligence platform designed to detect data breaches.

2/7/17

Netwrix

$56

Provider of visibility and governance platform designed to detect insider threats on premises and in the cloud.


Dragoneer Investment Group, Benchmark Capital, New Enterprise Associates

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

Temasek Holdings

AT&T, Microsoft Ventures, Norwest Venture Partners, Lightspeed Venture Partners

Updata Partners

Cisco Investments, Lightspeed Venture Partners, Aspect Venture Partners, Icon Ventures, Norwest Venture Partners, Shlomo Kramer

Updata Partners

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

Market Cap @ IPO Date

Amount Raised

Original Filing Range

Offer Price

% Change Offer / Midpoint Price

24-Mar-17

$873

$126

12.00 - 14.00

$14.00

7.7%

10.7%

10.7%

16-Mar-17

$3,118

$221

14.00 - 16.00

$17.00

13.3%

45.6%

32.5%

28-Oct-16

$1,169

$146

13.00 - 15.00

$17.00

21.4%

40.5%

69.7%

6-Oct-16

$1,601

$133

14.00 - 16.00

$18.00

20.0%

84.9%

32.7%

30-Sep-16

$5,079

$238

11.00 - 13.00

$16.00

33.3%

131.3%

21.9%

23-Sep-16

$841

$96

13.00 - 15.00

$16.00

14.3%

40.9%

(26.3%)

23-Sep-16

$453

$87

10.50 - 12.50

$13.00

13.0%

21.2%

(5.1%)

Offer Date

23

(1)

Name

Notes: Source: Capital IQ and Dealogic. Market Data as of 03/24/2017. (1) First Trading Day listed as Offer Date.

% Change % Change Current 1st Trading Day / Offer Price / Offer Price

IPO PIPELINE Software IPOs in Public Registration ($MM)

Issuer

Adj. EBITDA

Last Financing Date

Amount Raised

Funding TD

Post Money Valuation

38.5%

($28.8)

26-Feb-16

$0.4

$116.9

ND

87.0%

($61.4)

8-Sep-15

$75.0

$231.5

$1,180.0

LTM

Primary Industry

Initial Filing Date

Initial Offering Amount

Revenue

Rev Growth

Network Management Software

13-Mar-17

$100

$124.3

Internet Software and Services

13-Feb-17

$100

$160.3

(1)

(2)

24

Notes: Source: Pitchbook and SEC.gov. Offering amounts $10MM or greater. (1) LTM as of 01/31/2017. (2) LTM as of 12/31/2016.

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

210

Strategic Acquisitions

IPO

200 6

(7)

195

11

(11)

(5)

190

(4) Fortinet CDC Software LogMeIn Medidata SolarWinds Rosetta Stone

180

170

7

(6)

(11)

(8)

17

(9)

17

16

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

(9)

.

11

(7)

(10)

(6)

9

(8) Jive Imperva Carbonite Tangoe Responsys Cornerstone Epocrates

160

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

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

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

(12)

(9) 1 Mulesoft

150 2008

2009

IPO Strategic Exits PE Exits

25

Notes: Sources: Capital IQ, company filings. Market Data as of 03/24/2017.

2010

2009 +6 -7 -5

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 +1 -3 -1

(3) (1)

158

VENTURE CAPITAL INDUSTRY TMT Transactions Since Q4 2001 $12

1,000

$10 800

$Bn

600

$6 400 $4

200 $2

$0 Q4 2001

Q4 2002

Q4 2003

Q4 2004

Q4 2005

Q4 2006

Q4 2007

Q4 2008

Q4 2009

Q4 2010

Q4 2011

Q4 2012

Q4 2013

Q4 2014

Quarter - Year (1)

Number of Deals

26

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.

Q4 2015

0 Q4 2016

Number of Investments

$8

GCA OVERVIEW Deep Software Sector Expertise

Acquired by

Acquired by

Acquired by

Preferred Stock

Acquired by

Acquired by

Acquired by

Acquired by

Acquisition of

We Advised the Seller



Financial Advisor





We Advised the Buyer

Acquired by

Acquired by

Convertible Note Offering

Strategic Advisory Services

Investment by

Preferred Stock

Acquisition of

Acquisition of

Acquired by



Financial Advisor

Financial Advisor


Financial Advisor




Acquired by

Acquired by

Acquired by

Preferred Stock

Acquired by

Acquired by

Acquired by

Acquired by

Acquisition of




Financial Advisor






Acquired by

Acquired by

Acquired by

Acquired by

Acquired by

Acquired by

Acquired by







Acquired by

Acquired by


27

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.

GCA OVERVIEW Software Team

th

One Maritime Plaza, 25th Fl. San Francisco, CA 94111 United States Phone: (415) 318-3600

28

Tokyo

Frankfurt

London

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

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

New York

San Francisco

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

Todd Carter

Clark Callander

Steve Fletcher

Paul DiNardo

Sascha Pfeiffer*

Akikazu Ida*

Adrian Reed*

Co-President and CEO

Co-Head of Investment Banking

Managing Director

Managing Director

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]

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

James Orozco

Chris Gough

Glen Kruger

Raiko Stelten*

Gautam Garg

Mike Janovec

Managing Director

Managing Director

Director

Director

Vice President

Vice President




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



*Adrian Reed is a Managing Director at GCA Altium Limited, a wholly-owned subsidiary of GCA Corporation. *Sascha Pfeiffer is a Managing Director at GCA Altium AG, a wholly-owned subsidiary of GCA Corporation. *Raiko Stelten is a Director at GCA Altium Limited, a wholly-owned subsidiary of GCA Corporation. *Akikazu Ida is a Managing Director at GCA Corporation.