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MINNEAPOLIS | BOSTON | CHICAGO | HOUSTON | LONDON | LOS ANGELES | NEW YORK | SAN FRANCISCO | ZÜRICH
Piper JaffraySoftware Activity Update Fourth Quarter 2017
Michael KimHead of Technology Investment BankingPiper Jaffray & Co.
2PIPER JAFFRAY
Piper Jaffray Software Team OverviewGlobal Reach
Our firm consists of 1,300+ professionals in 59 offices globally including Minneapolis (HQ), San Francisco, Charlotte, New York,
Chicago, Seattle, Boston, Aberdeen, London, Hong Kong and Zürich
Technology Office Locations: San Francisco, CA Minneapolis, MNBoston, MA
24 investment bankers focused on Software, Financial Technology, Tech-Enabled
Services, BPO and Internet & Digital Media
Recent Transactions
Technology Team
Michael KimHead of Technology Investment BankingApplication Software
Peter LombardManaging Director
Head of Technology Mergers & [email protected]
Garin ArevianManaging Director
Vertical Applications & Tech-Enabled [email protected]
Jason Harkness Managing Director
Internet and Related [email protected]
Andy LivadariuManaging Director
Application [email protected]
Jason MylerManaging Director
Vertical Applications & Tech-Enabled [email protected]
Steven SchmidtManaging Director
Financial and Application [email protected]
Greg KlancherPrincipal
Infrastructure & Security [email protected]
Domestic Expertise
Sell-Side Advisor
Undisclosed
has been acquired by
$109,167,123
Follow-On Offering
Joint Bookrunner
Undisclosed
Buy-Side Advisor
has acquired a majority stake in
has purchased a majority stake in
Undisclosed
Buy-Side Advisor
has been acquired by
$120,000,000
Sell-Side Advisor
Co-Manager
Initial Public Offering
$67,004,000
Initial Public Offering
$254,150,000
Co-Manager
Sell-Side Advisor
Undisclosed
has been acquired by
$132,825,000
Co-Manager
Initial Public Offering
has been acquired by
Sell-Side Advisor
Undisclosed
has been acquired by
Undisclosed
Sell-Side Advisor
has merged with
Undisclosed
Sell-Side Advisor
portfolio company ofInitial Public
Offering
$150,880,000
Co-Manager
Initial Public Offering
$884,400,000
Co-Manager
Initial Public Offering
$120,000,000
Co-Manager
3PIPER JAFFRAY
Supporting Clients – Leading Industry Conferences and Events
Silicon Valley Technology Crossover Investor SummitMay 18, 2017 | Menlo Park, CA
Technology SelectSeptember 5–6, 2017 | Laguna Niguel, CA
15 of the highest growth late-stage private technology companies had their own suite at the Rosewood Sand Hill as 15 of the top
public and crossover investors visit for one-on-one’s
30+ of the most notable public technology companies will be paired with major institutional investors in one-on-one meetings providing
direct insights and feedback
Technology Ski SummitJanuary 9–11, 2018 | Aspen, CO
Technology Growth EquityOctober 4, 2017 | New York, NY
30 senior representatives from leading software and internet companies, venture capital and private equity firms focused on the
technology and business services sectors
50+ leading privately held software and internet companies and 100+ leading technology growth equity and strategic investors meet for one-on-one meetings attended by CEO's/CFO's and investors
4PIPER JAFFRAY
Pricing Date Company Deal Description Deal Amount ($M)
11/14/17
Send Grid is a Denver, Colorado-based provider of mobile and cloud-based email service platform designed that delivers customer communication which drives engagement and business growth
The Company sold 8,200,000 shares at a price of $16 per share on the New York stock exchange under the ticker symbol of SEND
$151
11/9/17
Bandwidth is a Raleigh, North Carolina-based provider of cloud-based data and voice communications services that offers voice over internet protocol, mobile, internet access, conferencing and managed networks
The Company sold 4,000,000 shares at a price of $20 per share on the Nasdaq stock exchange under the ticker symbol of BAND
$83
10/26/17
Forescout is a San Jose, Calif.-based developer of network access control and policy compliance management solutions designed to integrate network security, mobility and IT management
The Company sold 5,280,000 shares at a price of $22 per share on the Nasdaq stock exchange under the ticker symbol of FSCT
$134
10/18/17
MongoDB is a New York-based provider of an open source database system with a No-SQL database designed for large-scale grid deployments that allows companies to more easily manage and store data
The Company sold 8,000,000 shares at a price of $24 per share on the Nasdaq stock exchange under the ticker symbol of MDB
$221
Snapshot Of Select Software Initial Public Offerings During Q4 2017
Source: Public news releases, Pitchbook and CapitalIQ.
5PIPER JAFFRAY
Source: Dealogic.Deals, current market cap, and offer to current data as of December 29, 2017.Includes all IPOs and FOs since 2015 greater than $20MM.
Recent Software IPO and Follow-On PerformanceRecent Technology Follow-onsRecent Software IPOs
PricingDate
IssuerDeal Val ($MM)
Mkt Cap ($MM)
Deal Val /Mkt Cap
CurrentMkt Cap ($MM)*
% SellingShdr
% Price FTO
Offer /30-Day
Offer /Current*
12/6/17 Attunity Ltd $23 $145 16% $140 0% (6.5%) 3% 3%
12/4/17 BlackLine Inc $155 $1,892 8% $1,734 100% (3.9%) 2% (5%)
11/16/17 Veritone Inc $26 $427 6% $373 0% (20.6%) (1%) 1%
11/15/17 Everbridge Inc $20 $762 3% $840 100% (8.8%) 6% 10%
11/15/17 Talend SA $111 $1,218 9% $1,092 100% (3.7%) (0%) (7%)
11/15/17 Appian Corp $88 $1,281 7% $1,904 100% (12.9%) 3% 55%
9/27/17 Cloudera Inc $254 $2,227 11% $2,101 78% (10.5%) (9%) (3%)
9/14/17 Quintiles IMS Holdings Inc $476 $20,667 2% $19,636 100% (0.2%) 5% (6%)
9/7/17 Alteryx Inc $170 $1,262 13% $1,139 100% (6.8%) (3%) (8%)
9/6/17 2U Inc $206 $2,542 8% $2,231 4% (3.2%) 20% (4%)
7/19/17 USA Technologies Inc $43 $234 18% $210 0% (14.3%) 18% 16%
6/13/17 Donnelley Financial Solutions Inc $150 $711 21% $753 100% 7.8% 6% 8%
6/6/17 Upland Software Inc $40 $448 9% $446 0% (2.5%) 0% 2%
5/26/17 Asure Software Inc $30 $154 19% $180 0% (7.7%) 11% 8%
5/24/17 MINDBODY Inc $141 $1,268 11% $1,189 0% (0.9%) 1% (3%)
5/24/17 Quintiles IMS Holdings Inc $590 $18,532 3% $19,636 100% 0.0% 8% 6%
5/24/17 BlackLine Inc $132 $1,712 8% $1,836 100% 3.4% 15% 8%
5/23/17 Trade Desk Inc $252 $2,128 12% $2,121 100% 3.9% 4% (4%)
5/18/17 Shopify Inc $576 $8,955 6% $8,492 0% 1.3% (4%) (5%)
4/11/17 Coupa Software Inc $128 $1,288 10% $1,536 93% (0.6%) 30% 15%
4/5/17 Everbridge Inc $74 $563 13% $679 84% 2.3% 14% 23%
3/15/17 Talend SA $108 $826 13% $1,003 100% 7.1% 4% 22%
2/27/17 Trade Desk Inc $259 $1,441 18% $2,121 100% 6.4% 5% 41%
Mean $176 $3,073 11% $3,104 63% -3.08% 6% 8%
Median $132 $1,268 10% $1,189 100% -2.50% 4% 3%
PricingDate
IssuerPricing
to Range
Deal Value ($MM)
Mkt Cap ($MM)
Deal Val / Mkt Cap
CurrentMkt Cap ($MM)*
% Selling Shrs
% Price FTO
Offer /30-Day
Offer /Current*
11/14/17 SendGrid Inc Above $151 $653 23% $1,008 0% 10% 20% 50%
11/9/17 Bandwidth Inc In Range $83 $352 24% $407 0% (5%) 6% 16%
10/26/17 ForeScout Technologies In Range $134 $814 16% $1,209 0% 5% 30% 45%
10/18/17 MongoDB Inc Above $221 $1,175 19% $1,501 0% 26% 24% 24%
6/29/17 Tintri Inc Below $67 $216 31% $225 0% (39%) (2%) 4%
4/27/17 Cloudera Inc Above $259 $1,921 13% $2,101 0% 15% 49% 7%
4/12/17 Yext Inc Above $133 $940 14% $1,200 0% 22% 25% 21%
4/6/17 Okta Inc Above $215 $1,543 14% $2,173 0% 21% 48% 34%
3/23/17 Alteryx Inc In Range $145 $788 18% $1,139 0% 8% 10% 39%
3/16/17 MuleSoft Inc Above $254 $2,142 12% $3,212 0% 31% 31% 47%
10/27/16 BlackLine Inc Above $168 $839 20% $1,836 0% 21% 58% 110%
10/5/16 Coupa Software Inc Above $153 $866 18% $1,536 0% 20% 40% 61%
9/29/16 Nutanix Inc Above $274 $2,196 12% $3,053 0% 33% 55% 26%
9/22/16 Apptio Inc Above $110 $597 19% $689 0% 14% 25% 8%
9/22/16 Gridsum Holding Inc Above $100 $373 27% $255 0% 13% 23% (34%)
9/20/16 Trade Desk Inc Above $97 $688 14% $2,121 0% 20% 47% 178%
9/15/16 Everbridge Inc In Range $104 $323 32% $679 17% 0% 30% 103%
7/28/16 Talend SA Above $109 $503 22% $1,003 0% 13% 61% 93%
6/22/16 Twilio Inc Above $173 $1,233 14% $2,634 0% 15% 172% 94%
6/9/16China Online Education Group
In Range $52 $374 14% $321 0% 0% 3% (16%)
4/21/16 SecureWorks Corp Below $112 $1,129 10% $753 0% (15%) (1%) (34%)
12/9/15 Atlassian Corp plc Above $531 $4,382 12% $7,932 0% 20% 29% 68%
11/18/15 Mimecast Ltd In Range $78 $540 14% $1,509 0% (9%) (1%) 168%
Mean $162 $1,069 18% $1,674 1% 10% 34% 48%
Median $134 $814 16% $1,209 0% 14% 29% 39%
6PIPER JAFFRAY
16.4%
22.0%
23.6%
28.6%
35.9%
36.5%
40.0%
42.2%
49.9%
64.1%
19.4%
25.1%
28.2%
SUB-SECTOR
SaaS High Growth
CRM / Marketing
BI / Data Analytics
Infrastructure / IT Management
Moderate Growth SaaS
Human Capital Management
Contact Center
Large-Cap Technology
Security Software
HR Outsourcing
Software Stock PerformancePerformance in CY 2017 By Sub-Sector
Source: Capital IQ.Note: Represents stock performance between 12/30/16 and 12/29/17.
CY 2017 Performance
7PIPER JAFFRAY
IPO Valuation Breakpoint Analysis 2014 – 2017, At Pricing
Source: Capital IQ.
Forward Year Revenue Growth vs. Revenue Multiple
$ in millions
Summary Statistics - Software IPOs 2014-2017
Metric Median Median Median Median
Growth Profile: Less than 20% 20.0% - 30.0% 30.0% - 40.0% Greater than 40.0%
Number of Deals 5 19 18 11
Operating Metrics:
LTM Revenue $159.3 $103.2 $120.3 $65.1
MRQ Revenue $41.3 $28.3 $35.6 $25.4
LTM Gross Margin 62.2% 67.3% 72.3% 62.4%
LTM EBITDA $19.8 ($24.2) ($25.5) ($42.6)
LTM EBITDA Margin 12.4% (17.8%) (25.8%) (38.9%)
MRQ EBITDA $4.0 ($6.7) ($6.3) ($9.5)
CAC Ratio 0.91 0.54 0.53 0.51
Pricing Statistics:
Forward Year Rev. Multiple 4.3x 3.7x 5.8x 5.6x
% Change from Offer to:
One Day 12.0% 30.6% 27.4% 49.2%
One Month 10.4% 29.4% 27.1% 43.8%
Current (12/29/2017) (43.5%) 46.0% 80.5% 73.4%
4.3x3.7x
5.8x 5.6x
0.0x
1.0x
2.0x
3.0x
4.0x
5.0x
6.0x
7.0x
Less than 20% 20.0% - 30.0% 30.0% - 40.0% Greater than 40.0%
Forw
ard
Year
Rev
enue
M
ultip
le
Forward Year Revenue Growth
8PIPER JAFFRAY
Historical Public Software Company IPO Statistics 2014–2017
Source: Capital IQ.(1) EV / EBITDA multiples less than 0.0x or greater than 50.0x deemed not meaningful.
($ in Millions) 2014 Median 2015 Median 2016 Median 2017 Median
Number of Deals 20 12 11 10Deal StatisticsDeal Size $115.0 $101.7 $108.7 $147.9
Post-Deal Market Cap $664.2 $620.3 $771.3 $1,091.1
Deal Size / Post-Deal Market Cap 17.3% 16.4% 14.1% 13.6%
Financial Metrics at IPO
LTM Revenue $84.6 $107.6 $112.3 $145.9
Current Year Revenue $99.0 $117.3 $122.6 $163.3
Forward Year Revenue $132.0 $144.5 $165.6 $208.0
Forward Year Revenue Growth 29.7% 30.2% 35.1% 31.7%
MRQ Revenue $24.9 $30.1 $47.2 $38.5
LTM EBITDA ($15.0) ($18.9) ($29.3) ($54.6)
LTM EBITDA Margin (23.5%) (18.1%) (17.8%) (31.0%)
MRQ EBITDA ($4.7) ($4.7) ($6.7) ($12.7)
MRQ EBITDA Margin (22.0%) (16.4%) (10.5%) (29.9%)
Valuation Metrics at IPO
Current Year Revenue Multiple 5.2x 5.4x 4.2x 6.3x
Current Year EBITDA Multiple(1) 23.0x 35.6x 14.1x 47.4x
Forward Year Revenue Multiple 4.0x 4.1x 3.0x 4.9x
Forward Year EBITDA Multiple 24.6x 34.9x 20.4x 43.9x
9PIPER JAFFRAY
7.1% 7.2% 7.3%
10.0% 11.5% 12.1%
16.5% 18.3%
24.1% 27.8%
0.0% 10.0% 20.0% 30.0%
Large-Cap Technology
HR Outsourcing
Contact Center
Moderate Growth SaaS
Security
BI / Data Analytics
Infrastructure / IT Management
Human Capital Management
CRM / Marketing
SaaS High Growth
Comparable Public Software Comps (Valuation Metrics)
Source: Capital IQ.Note: Figures represent the median of each comparable group.
2018E EV / REV 2019E EV / REV
2018E Rev Growth 2019E Rev Growth
6.6% 7.3%
9.3% 11.3% 11.6%
12.7% 13.9%
17.4% 22.4%
24.6%
0.0% 10.0% 20.0% 30.0%
HR Outsourcing
Large-Cap Technology
Contact Center
BI / Data Analytics
Moderate Growth SaaS
Security
Infrastructure / IT Management
Human Capital Management
CRM / Marketing
SaaS High Growth
3.1x3.5x3.5x
3.9x4.2x
4.5x4.7x
5.4x5.9x
7.1x
0.0x 2.0x 4.0x 6.0x 8.0x
Contact Center
Moderate Growth SaaS
HR Outsourcing
BI / Data Analytics
Security
Infrastructure / IT Management
Large-Cap Technology
CRM / Marketing
Human Capital Management
SaaS High Growth
2.6x3.2x3.4x
3.8x3.9x
4.1x4.4x4.6x
5.0x5.6x
0.0x 2.0x 4.0x 6.0x
Contact Center
Moderate Growth SaaS
HR Outsourcing
Infrastructure / IT Management
BI / Data Analytics
Security
CRM / Marketing
Large-Cap Technology
Human Capital Management
SaaS High Growth
10PIPER JAFFRAY
SaaS Valuation Framework
Source: Capital IQ as of 12/29/2017, Thomson Reuters, Company Filings.*Piper Jaffray estimate using EBITDA as proxy for FCF.
Given the rapid maturity of the business model, free cash flow conversion combined with revenue growth provides a clearer understanding of valuation for SaaS companies
AVG EV/Rev8.5x
AVG Rev Growth + FCF Margin50.8%
AVG EV/Rev6.2x
AVG Rev Growth + FCF Margin31.8%
AVG EV/Rev2.5x
AVG Rev Growth + FCF Margin13.2%
AMBR
APTIBNFT
DATA
ECOM
LPSNMODN
SREV
CALD
CSOD
GWRE
HUBSTYLULTI ZEN
BLKB
BL
BOX
COUP
MB
NEWR
PCTY
QTWO
TWLO
TWOU
ADBE
CRM
NOW
SPLKWDAY
ELLI
PAYC
SHOP
TEAM
VEEV
HDP
y = 15.846x + 0.8012R² = 0.8177
0.0x
2.0x
4.0x
6.0x
8.0x
10.0x
12.0x
14.0x
0% 10% 20% 30% 40% 50% 60% 70%
2018
E E
V /
Rev
enue
2018E FCF Margin + Revenue Growth
11PIPER JAFFRAY
Best & Worst Performing Software Stocks Top and Bottom 20 2017 Performers
Source: Capital IQ.Note: Dates between 12/30/16 and 12/29/17.
Bottom 20 Performers Top 20 Performers
68.8%
69.3%
70.2%
70.5%
72.3%
72.7%
73.1%
75.3%
75.4%
76.6%
78.0%
81.2%
87.5%
88.1%
89.0%
104.5%
135.0%
142.0%
142.0%
150.0%
Talend SA
Instructure, Inc.
Adobe Systems Incorporated
Callidus Software Inc.
Red Hat, Inc.
Datawatch Corporation
TriNet Group
Five9, Inc.
ServiceNow, Inc.
Paycom Software, Inc.
Model N
Varonis Systems, Inc.
Qualys, Inc.
HubSpot, Inc.
Atlassian Corporation
New Relic, Inc.
RingCentral, Inc.
HortonWorks
Upland Software
eGain Corporation
(1.4%)
(1.5%)
(2.5%)
(3.3%)
(7.6%)
(8.3%)
(9.0%)
(9.1%)
(11.3%)
(14.5%)
(16.2%)
(16.5%)
(18.2%)
(19.2%)
(24.2%)
(30.5%)
(33.4%)
(33.5%)
(37.3%)
(45.6%)
8x8 Inc.
Citrix Systems, Inc.
Akamai Technologies, Inc.
NetScout Systems, Inc.
IBM
j2 Global, Inc.
CyberArk Software, Ltd.
Benefitfocus, Inc.
Zix Corporation
WageWorks, Inc.
SecureWorks Corp.
Cornerstone OnDemand, Inc.
Twilio, Inc.
Amber Road, Inc.
Castlight Health
SPS Commerce, Inc.
Marin Software Incorporated
MicroStrategy Inc.
ChannelAdvisor Corporation
ServiceSource International, Inc.
12PIPER JAFFRAY
Announced Date
Acquirer Target Deal Description Deal Amount ($M)
12/18/17 Oracle acquires Aconex, an Australian-based cloud solution that manages
team collaboration for construction projects, in a continued effort toexpand its cloud-computing services
$1,260
11/29/17 Bullhorn, an Insight Venture Partners company, acquires Peoplenet to
help accelerate its cloud-based strategy for staffing firms with solutions for time, attendance, and expense management
N/A
11/27/17 Marlin Equity will help Bazaarvoice bring its innovative consumer-
generated content, advertising and personalization to market faster and more efficiently
$520
11/27/17 Thoma Bravo offers Barracuda shareholders $27.55 per share for
Barracuda to continue growing its email security and management, network and application security, and data protection solutions
$1,612
11/13/17 Vista Equity Partners will help Jamf accelerate its growth and innovation
through focused investment and strategic acquisitions that drive its mission to help organizations manage Apple devices
N/A
10/31/17 The GPSi acquisition is consistent with Ingersoll Rand's strategy to help
customers solve climate and industrial challenges including energy and fuel efficiency, food waste and productivity
N/A
10/23/17 BroadSoft provides software and services that enable mobile, fixed-line
and cable service providers that will strengthen Cisco’s ability to sell its products to big telecom providers
$2,288
10/17/17 Intralinks, a leading global provider of cloud-based virtual data room and
highly secure team collaboration solutions, will be an independent privately owned portfolio company of investment funds affiliated with Siris
$1,082
Snapshot Of Select Software M&A Transactions During Q4 2017
Source: Public news releases, Pitchbook and CapitalIQ.
13PIPER JAFFRAY
Software M&A ActivityQ1 2014 – Q4 2017
Source: S&P Capital IQ.Note: Software transactions greater than 10 million USD in enterprise value.
# of Deals 48 55 48 45 47 54 50 49 29 42 38 33 31 39 30 34
( USD in millions)
$11,957 $12,062
$23,829
$9,861 $11,740$13,482
$22,438
$15,304
$18,421
$53,011
$33,046
$11,545 $11,374$8,709
$10,991
$15,101
4.2x
7.0x
5.2x
10.5x
5.6x
4.5x 5.0x
7.3x
4.7x
5.9x
6.1x
6.0x
7.8x
3.5x 3.5x4.0x
0.0x
2.0x
4.0x
6.0x
8.0x
10.0x
12.0x
$0
$10,000
$20,000
$30,000
$40,000
$50,000
$60,000
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
2014 2015 2016 2017
Total Deal Value Average EV / REV Multiple
14PIPER JAFFRAY
Public Target M&A Activity in SoftwareQ1 2014 – Q4 2017
Source: S&P Capital IQ.Note: Software transactions greater than 10 million USD in enterprise value.
( USD in millions)
# of Deals 7 7 7 8 6 11 10 12 6 18 13 6 8 5 5 4
$3,070
$6,775
$12,690
$2,957
$6,125 $5,807$6,967
$9,085$11,721
$40,761
$26,207
$4,631
$1,160$2,478 $3,304 $3,204
2.6x
6.2x6.7x
2.6x
4.4x
3.1x
4.9x
3.3x
5.0x
5.3x
4.9x
2.9x
2.4x
3.1x2.9x
4.4x
0.0x
2.0x
4.0x
6.0x
8.0x
$0
$5,000
$10,000
$15,000
$20,000
$25,000
$30,000
$35,000
$40,000
$45,000
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
2014 2015 2016 2017
Total Deal Value Average EV / REV Multiple
15PIPER JAFFRAY
Private Target M&A Activity in SoftwareQ1 2014 – Q4 2017
Source: S&P Capital IQ.Note: Software transactions greater than 10 million USD in enterprise value.
( USD in millions)
# of Deals 41 58 41 37 41 43 40 37 23 24 25 27 23 34 25 30
$8,887
$5,287
$11,139
$6,904
$5,615
$7,675
$15,472
$6,220 $6,700
$12,251
$6,839 $6,914
$10,214
$6,232
$7,687
$11,897
4.6x
7.3x
4.9x
13.4x
6.0x
5.0x
5.0x
9.3x
4.6x
6.5x
7.2x 7.0x
8.3x
3.6x 3.7x 3.7x
0.0x
2.0x
4.0x
6.0x
8.0x
10.0x
12.0x
14.0x
$0
$2,000
$4,000
$6,000
$8,000
$10,000
$12,000
$14,000
$16,000
$18,000
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
2014 2015 2016 2017
Total Deal Value Average EV / REV Multiple
16PIPER JAFFRAY
Acquirer
Target
Announced Date 7/28/16 11/10/16 11/20/16 1/24/17 3/7/17 4/18/17 7/25/2017 10/23/2017 12/18/2017
Deal Amount $9,300 $540 $2,334 $3,700 $614 $850 $850 $2,288 $1,260
EV / LTM REV 10.8x 2.5x 3.5x 17.4x 5.6x 13.3x 9.7x 5.3x 10.0x
# of Deals 33 43 38 35 40 33 31 36 24 29 22 29 20 11 14 23
Strategic Public Acquirer M&A Activity in SoftwareQ1 2014 – Q4 2017
Source: S&P Capital IQ.Note: Software transactions greater than 10 million USD in enterprise value.
Notable Recent Announced Transactions ($ millions)
( USD in millions)
$6,722$9,583
$19,764
$5,289$8,247 $6,348
$11,302$7,040
$17,689
$40,912
$21,282
$9,935 $8,321
$1,582$5,076
$8,570
4.9x
6.6x5.2x
10.0x
6.4x5.9x
4.9x
9.1x
4.7x6.9x
10.8x
6.0x
9.3x
6.0x
4.4x5.4x
0.0x
2.0x
4.0x
6.0x
8.0x
10.0x
12.0x
$0$5,000
$10,000$15,000$20,000$25,000$30,000$35,000$40,000$45,000
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
2014 2015 2016 2017
Total Deal Value Average EV / REV Multiple
17PIPER JAFFRAY
$4,795
$2,360$3,600
$3,982
$3,388 $2,870
$9,543
$7,827
$722
$11,434
$8,778
$1,150$2,586
$5,716
$2,269
$4,745
1.7x
8.0x
4.6x3.0x
3.8x 3.6x
3.7x 4.3x
0.0x
4.3x
3.1x
7.9x
3.6x2.7x
0.9x
3.2x
0.0x
2.0x
4.0x
6.0x
8.0x
10.0x
$0
$2,000
$4,000
$6,000
$8,000
$10,000
$12,000
$14,000
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
2014 2015 2016 2017
Total Deal Value Average EV / REV Multiple
# of Deals 8 7 6 5 5 12 9 8 4 10 8 2 4 15 3 5
Private Equity M&A Activity in SoftwareQ1 2014 – Q4 2017
Source: S&P Capital IQ.Note: Software transactions greater than 10 million USD in enterprise value.
Notable Recent Announced Transactions ($ millions)
Acquirer
Target
Announced Date 6/1/16 6/7/16 7/13/16 8/31/16 9/7/16 1/3/17 1/19/17 5/30/17 10/17/17 11/27/17
Deal Amount $509 $3,000 $544 $1,400 $2,200 $1,150 $800 $564 $1,082 $1,612
EV / LTM REV 3.5x 4.2x 4.4x 3.3x 6.8x 2.6x 4.6x 5.9x 3.5x 3.8x
( USD in millions)
18PIPER JAFFRAY
Announced Date Company Deal Description Deal Amount ($M)
12/8/17 Core Security SDI, a provider of intelligent identity governance and
administration, has raised $200 million in a round led by K1 investment management
$200
12/5/17 Lyft, a smartphone-based ridesharing and peer-to-peer transportation
company, has raised $1 billion followed by an additional $500 million in Series H funding led by CapitalG
$1,500
11/28/17 1QBit, a quantum computing software designed to harness the
quantum hardware technologies in order to solve intractable industry problems, has raised $35 million in a Series B funding round
$35
10/24/17 GTreasury, a provider of installed as well as SaaS treasury
management services, has raised $42 million of development capital from Mainsail Partners
$42
10/19/17 Coda, a developer of online document and spreadsheet software, has
raised $60 million in Series A funding from several private equity investors to rethink users’ notions of collaboration within documents
$60
10/18/17 Lightspeed POS, a provider of point of sale systems and eCommerce
solutions for merchants and restaurants, has raised $166 million of Series D funding led by Caisse de dépôt et placement du Québec
$166
Snapshot Of Select Software Private Placements During Q4 2017
Source: Public news releases, Pitchbook and CapitalIQ.
19PIPER JAFFRAY
Private Placement ActivitySoftware Private VC / PE Summary: Q1 2014 – Q4 2017
Source: S&P Capital IQ.
( USD in millions)
$2,810
$4,337
$1,407
$2,111
$5,883
$1,589
$3,320
$2,097
$3,306
$4,963
$2,695
$1,816$1,573
$3,953
$2,784
$4,535
112
133121
145
136
164 161
143151
143133
121
168
196 200189
0
50
100
150
200
250
$0
$1,000
$2,000
$3,000
$4,000
$5,000
$6,000
$7,000
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
2014 2015 2016 2017
Total Deal Value Total # of Deals
20PIPER JAFFRAY
64% 64%59%
62% 60%65% 66%
68%
60%
54% 55%59% 59%
54%
60%55% 57%
53% 53%
Debt Market Overview
Source: S&P Global Market Intelligence1) Includes broader LBO volume beyond middle market
Middle Market LBO Debt Contribution LBO Volume by Industry – 4Q 2017
7.3%
2.8%
3.1%
4.5%
6.1%
6.3%
7.3%
9.4%
9.5%
20.5%
23.3%
Other
Retail
Environmental
Entertainment & Leisure
Chemicals
Oil & Gas
Food & Beverage
Telecom
Healthcare
Services & Leasing
Computers & Electronics
Total Transaction Volume of $11.6 Billion(1)
Middle Market LBO Loan Multiples Middle Market LBO Volume by Quarter
4.0x
3.4x3.9x 3.8x
4.2x4.7x 4.7x
5.6x
4.5x
3.3x
4.2x 4.3x4.5x
4.8x5.3x 5.3x 5.3x 5.5x
5.1x
0123456
1 Lien 2 Lien Other Senior Sub. Debt
$1.2
$1.6 $1.5
$1.8
$1.2
$1.9$2.0
$0.4
$0.9
$1.2
$0.7$0.9
$1.0
$1.8
$2.9
$1.1
Institutional Pro Ratast ndDebt Tranche / EBITDA:
Defined as Issuers with EBITDA of $50 Million or Less
Defined as Issuers with EBITDA of $50 Million or Less Defined as Issuers with EBITDA of $50 Million or Less($ In Billions)
Appendix
22PIPER JAFFRAY
SaaS High Growth
Source: S&P Capital IQ, Thomson Reuter’s Consensus, and Renaissance Capital.
EV/Revenue > 20x Not Meaningful (NM).
EV/EBITDA > 60x Not Meaningful (NM).
Market Enterprise Gross Revenue EV / EV /
Cap Value Price % Revenue Margin EBITDA Growth Revenue EBITDA
($ in millions, except per share data) 12/29/2017 12/29/2017 52 Wk High LTM LTM LTM 2018 2019 2018 2019 2018 2019
SaaS High Growth
BlackLine, Inc. $1,734 $1,625 81% 162 76% (3) 29% 28% 7.2 5.7 NM NM
HubSpot, Inc. 3,304 3,070 95% 346 79% 8 27% 24% 6.5 5.2 NM NM
New Relic, Inc. 3,181 2,953 95% 306 81% (10) 28% 25% 7.0 5.6 NM 46.5
RealPage, Inc. 3,672 3,866 95% 632 59% 134 25% 11% 4.6 4.1 17.6 14.9
ServiceNow, Inc. 22,519 21,574 99% 1,772 73% 366 32% 29% 8.5 6.6 32.9 23.1
Workday, Inc. 21,365 19,603 87% 1,995 70% 252 25% 23% 7.4 6.0 43.6 31.6
75th Percentile $16,942 $15,669 95% $1,487 78% $222 29% 27% 7.3x 5.9x 38.2x 35.3x
Median $3,488 $3,468 95% $489 75% $71 28% 25% 7.1x 5.6x 32.9x 27.3x
Mean $9,296 $8,782 92% $869 73% $124 28% 23% 6.9x 5.5x 31.4x 29.0x
25th Percentile $3,212 $2,983 89% $316 71% ($1) 26% 23% 6.6x 5.3x 25.3x 21.0x
23PIPER JAFFRAY
Moderate Growth SaaS
Source: S&P Capital IQ, Thomson Reuter’s Consensus, and Renaissance Capital
EV/Revenue > 20x Not Meaningful (NM).
EV/EBITDA > 60x Not Meaningful (NM).
Market Enterprise Gross Revenue EV / EV /
Cap Value Price % Revenue Margin EBITDA Growth Revenue EBITDA
($ in millions, except per share data) 12/29/2017 12/29/2017 52 Wk High LTM LTM LTM 2018 2019 2018 2019 2018 2019
Moderate Growth SaaS
Amber Road, Inc. $202 $216 75% $78 52% ($5) 10% 12% 2.5x 2.2x NM 33.2x
athenahealth, Inc. 5,415 5,544 84% 1,179 52% 193 11% 10% 4.1x 3.7x 15.2x 13.0x
Bandwidth Inc. 407 434 93% 159 45% 21 12% 19% 2.4x 2.0x NM NM
Benefitfocus, Inc. 844 910 73% 253 51% 13 9% 13% 3.2x 2.9x 32.4x 24.8x
Callidus Software Inc. 1,951 1,775 94% 240 61% 27 18% 21% 5.9x 4.9x 36.7x 27.5x
Castlight Health, Inc. 502 416 74% 124 66% (27) 23% 21% 2.6x 2.1x NM 33.5x
ChannelAdvisor Corporation 239 186 59% 120 78% 6 10% 9% 1.4x 1.3x 26.1x 14.0x
Cornerstone OnDemand, Inc. 2,046 1,945 80% 459 70% 21 3% 12% 3.9x 3.5x 20.5x 17.3x
Guidewire Software, Inc. 5,704 5,040 89% 528 60% 110 19% 15% 7.5x 6.5x 33.1x 33.1x
j2 Global, Inc. 3,641 4,237 82% 1,053 84% 411 9% 6% 3.5x 3.3x 8.6x 7.8x
LivePerson, Inc. 685 629 76% 218 73% 20 7% 10% 2.7x 2.5x 28.5x 21.7x
LogMeIn, Inc. 6,138 5,862 88% 802 80% 257 12% 6% 5.1x 4.8x 13.3x 12.2x
RingCentral, Inc. 3,744 3,572 97% 465 76% 27 24% 23% 5.8x 4.7x NM NM
Salesforce.com, inc. 75,457 73,746 94% 9,923 73% 1,557 20% 20% 5.9x 4.9x 26.3x 21.3x
ServiceSource International, Inc. 279 241 51% 242 32% 9 3% 5% 1.0x 0.9x 11.8x 8.9x
SPS Commerce, Inc. 846 680 67% 213 67% 33 10% 10% 2.8x 2.5x 15.9x 13.3x
The Ultimate Software Group, Inc. 6,715 6,586 93% 900 62% 210 18% 17% 5.9x 5.0x 23.8x 19.9x
WageWorks, Inc. 2,496 1,848 77% 462 63% 125 10% 10% 3.5x 3.2x 11.0x 9.7x
Zix Corporation 241 208 66% 64 81% 17 8% NA 2.9x NA 9.5x NA
75th Percentile $4,579 $4,639 91% $665 75% $159 18% 18% 5.5x 4.8x 27.4x 25.5x
Median $1,951 $1,775 80% $253 66% $27 10% 12% 3.5x 3.2x 20.5x 18.6x
Mean $6,187 $6,004 80% $920 65% $159 12% 13% 3.8x 3.4x 20.8x 19.5x
25th Percentile $454 $425 73% $186 56% $15 9% 10% 2.6x 2.3x 25.7x 12.8x
24PIPER JAFFRAY
Business Intelligence / Data Analytics
Source: S&P Capital IQ, Thomson Reuter’s Consensus, and Renaissance Capital.
EV/Revenue > 20x Not Meaningful (NM).
EV/EBITDA > 60x Not Meaningful (NM).
Market Enterprise Gross Revenue EV / EV /
Cap Value Price % Revenue Margin EBITDA Growth Revenue EBITDA
($ in millions, except per share data) 12/29/2017 12/29/2017 52 Wk High LTM LTM LTM 2018 2019 2018 2019 2018 2019
Business Intelligence / Data Analytics
Alteryx, Inc. $1,495 $1,313 87% $118 83% ($10) 37% 32% 7.4x 5.6x NM NM
Cegedim SA 568 838 98% 558 46% 41 3% 5% 1.4x 1.3x 8.2x 7.0x
Datawatch Corporation 116 86 75% 36 88% (2) 12% NA 2.0x NA NM NA
Inovalon Holdings, Inc. 2,188 1,907 84% 431 65% 89 8% 9% 3.9x 3.6x 15.4x 14.4x
MicroStrategy Incorporated 1,510 863 64% 507 81% 111 (0%) 3% 1.7 1.7 13.5 11.7
MongoDB, Inc. 1,501 1,213 87% 139 72% (69) 36% 35% 5.9 4.4 NM NM
Splunk Inc. 11,718 10,733 98% 1,158 79% 104 25% 29% 6.9 5.4 NM 33.5
Tableau Software, Inc. 5,518 4,529 84% 878 87% 91 11% 13% 4.7 4.1 NM 49.2
The Descartes Systems Group Inc 2,195 2,217 90% 227 73% 81 13% 9% 8.2 7.6 23.7 21.2
Verint Systems Inc. 2,703 3,103 94% 1,112 63% 168 7% 5% 2.5 2.4 10.5 9.5
Workiva Inc. 897 839 90% 200 71% (17) 14% 14% 3.6 3.1 NM NM
75th Percentile $2,449 $2,660 92% $718 82% $97 19% 25% 6.4x 5.1x 15.4x 27.4x
Median $1,510 $1,313 87% $431 73% $81 12% 11% 3.9x 3.9x 13.5x 14.4x
Mean $2,765 $2,513 86% $488 74% $53 15% 16% 4.4x 3.9x 14.3x 20.9x
25th Percentile $1,196 $851 84% $170 68% ($6) 7% 6% 2.3x 2.6x 10.5x 10.6x
25PIPER JAFFRAY
Infrastructure / IT Management
Source: S&P Capital IQ, Thomson Reuter’s Consensus, and Renaissance Capital.
EV/Revenue > 20x Not Meaningful (NM).
EV/EBITDA > 60x Not Meaningful (NM).
Market Enterprise Gross Revenue EV / EV /
Cap Value Price % Revenue Margin EBITDA Growth Revenue EBITDA
($ in millions, except per share data) 12/29/2017 12/29/2017 52 Wk High LTM LTM LTM 2018 2019 2018 2019 2018 2019
Infrastructure / IT Management
Atlassian Corporation Plc $10,474 $9,861 85% $677 80% $127 31% 27% 10.2x 8.0x 35.3x 29.7x
Box, Inc. 2,875 2,787 88% 479 73% (25) 23% 21% 4.5x 3.7x NM NM
CA, Inc. 13,929 14,029 91% 4,078 86% 1,314 3% 1% 3.3x 3.2x 8.5x 8.3x
Citrix Systems, Inc. 13,607 12,446 92% 3,464 85% 1,186 2% 3% 4.3 4.2 12.9 12.2
Cloudera, Inc. 2,770 2,492 71% 337 56% (105) 27% 24% 5.4 4.4 NM NM
Commvault Systems, Inc. 2,425 1,927 81% 673 87% 82 10% 11% 2.5 2.3 18.0 13.8
Constellation Software Inc. 16,149 16,046 96% 2,356 38% 354 18% 16% 5.6 4.8 21.1 18.3
Hortonworks, Inc. 1,418 1,355 96% 239 67% (100) NA NA NA NA NA NA
Micro Focus International plc 10,983 15,125 87% 1,930 84% 759 67% (2%) 3.6 3.7 9.4 8.5
MuleSoft, Inc. 3,023 2,689 80% 263 73% (43) 37% 30% 6.8 5.2 NM NM
NetScout Systems, Inc. 2,698 2,683 79% 1,104 72% 238 (7%) 3% 2.7 2.6 13.2 12.1
Nutanix, Inc. 5,660 5,294 92% 854 57% (152) 18% 23% 4.7 3.8 NM NM
Pegasystems, Inc. 3,671 3,477 73% 801 67% 106 12% 14% 3.9 3.4 31.0 23.4
Progress Software Corporation 2,051 1,989 99% 398 88% 154 2% 1% 4.9 4.9 10.3 10.3
Red Hat, Inc. 22,358 20,799 92% 2,777 85% 725 17% 13% 6.4 5.7 23.2 19.0
ServiceNow, Inc. 22,519 21,574 99% 1,772 73% 366 32% 29% 8.5 6.6 32.9 23.1
Software Aktiengesellschaft 4,382 4,275 98% 1,070 76% 365 3% 3% 3.9 3.7 12.3 11.7
Talend S.A. 1,092 998 81% 138 77% (16) 30% 33% 5.2 3.9 NM NM
Tintri, Inc. 160 173 68% 138 60% (89) (8%) 16% 1.5 1.3 NM NM
Twilio Inc. 2,196 1,912 68% 366 56% (1) 24% 25% 4.0 3.2 NM NM
Upland Software, Inc. 450 489 85% 89 65% 22 7% 6% 4.0 3.8 11.3 10.4
VMware, Inc. 51,759 44,231 97% 7,093 85% 2,486 10% 8% 5.1 4.7 14.1 12.1
75th Percentile $12,951 $13,633 95% $1,891 85% $366 27% 24% 5.4x 4.8x 22.7x 18.8x
Median $3,347 $3,132 88% $739 73% $116 17% 14% 4.5x 3.8x 13.7x 12.2x
Mean $8,939 $8,484 86% $1,413 72% $352 17% 15% 4.8x 4.1x 18.1x 15.2x
25th Percentile $2,253 $1,942 80% $344 65% ($23) 3% 3% 3.9x 3.4x 11.6x 10.7x
26PIPER JAFFRAY
Large-Cap Technology
Source: S&P Capital IQ, Thomson Reuter’s Consensus, and Renaissance Capital.
EV/Revenue > 20x Not Meaningful (NM).
EV/EBITDA > 60x Not Meaningful (NM).
Market Enterprise Gross Revenue EV / EV /
Cap Value Price % Revenue Margin EBITDA Growth Revenue EBITDA
($ in millions, except per share data) 12/29/2017 12/29/2017 52 Wk High LTM LTM LTM 2018 2019 2018 2019 2018 2019
Large-Cap Technology
Adobe Systems Incorporated $87,631 $83,693 94% $7,302 86% $2,949 20% 17% 9.6x 8.2x 21.4x 17.7x
HP Inc. 35,444 35,068 93% 52,056 18% 4,589 7% 1% 0.6 0.6 7.7 7.4
International Business Machines Corp 143,176 172,797 84% 78,366 46% 17,368 1% 0% 2.2 2.1 8.9 8.7
Intuit Inc. 40,392 40,459 98% 5,285 85% 1,968 11% 9% 6.8 6.2 18.5 17.2
Oracle Corporation 202,500 192,028 89% 38,907 58% 16,669 4% 4% 4.7 4.6 10.2 9.6
Salesforce.com, inc. 75,457 73,746 94% 9,923 73% 1,557 20% 20% 5.9 4.9 26.3 21.3
SAP SE 137,265 136,464 93% 28,616 70% 8,563 3% 7% 4.6 4.3 13.2 12.1
75th Percentile $140,220 $154,630 94% $45,482 79% $12,616 15% 13% 6.4x 5.6x 19.9x 17.4x
Median $87,631 $83,693 93% $28,616 70% $4,589 7% 7% 4.7x 4.6x 13.2x 12.1x
Mean $103,123 $104,894 92% $31,493 62% $7,666 9% 8% 4.9x 4.4x 15.2x 13.4x
25th Percentile $57,924 $57,102 91% $8,612 52% $2,458 4% 3% 3.4x 3.2x 9.6x 9.2x
27PIPER JAFFRAY
Human Capital Management
Source: S&P Capital IQ, Thomson Reuter’s Consensus, and Renaissance Capital.
EV/Revenue > 20x Not Meaningful (NM).
EV/EBITDA > 60x Not Meaningful (NM).
Market Enterprise Gross Revenue EV / EV /
Cap Value Price % Revenue Margin EBITDA Growth Revenue EBITDA
($ in millions, except per share data) 12/29/2017 12/29/2017 52 Wk High LTM LTM LTM 2018 2019 2018 2019 2018 2019
Human Capital Management
Benefitfocus, Inc. $844 $910 73% $253 51% $13 9% 13% 3.2x 2.9x 32.4x 24.8x
Cornerstone OnDemand, Inc. 2,046 1,945 80% 459 70% 21 3% 12% 3.9 3.5 20.5 17.3
Paycom Software, Inc. 4,729 4,697 93% 407 85% 122 25% 23% 8.7 7.0 21.9 17.9
Paylocity Holding Corporation 2,575 2,478 87% 316 59% 50 19% 19% 6.2 5.2 29.4 22.7
The Ultimate Software Group, Inc. 6,715 6,586 93% 900 62% 210 18% 17% 5.9 5.0 23.8 19.9
WageWorks, Inc. 2,496 1,848 77% 462 63% 125 10% 10% 3.5 3.2 11.0 9.7
Workday, Inc. 21,365 19,603 87% 1,995 70% 252 25% 23% 7.4 6.0 43.6 31.6
75th Percentile $5,722 $5,642 90% $681 70% $167 22% 21% 6.8x 5.6x 30.9x 23.7x
Median $2,575 $2,478 87% $459 63% $122 18% 17% 5.9x 5.0x 23.8x 19.9x
Mean $5,824 $5,438 84% $685 66% $113 16% 17% 5.5x 4.7x 26.1x 20.6x
25th Percentile $2,271 $1,897 78% $362 60% $36 10% 12% 3.7x 3.3x 21.2x 17.6x
28PIPER JAFFRAY
HR Outsourcing
Source: S&P Capital IQ, Thomson Reuter’s Consensus, and Renaissance Capital.
EV/Revenue > 20x Not Meaningful (NM).
EV/EBITDA > 60x Not Meaningful (NM).
Market Enterprise Gross Revenue EV / EV /
Cap Value Price % Revenue Margin EBITDA Growth Revenue EBITDA
($ in millions, except per share data) 12/29/2017 12/29/2017 52 Wk High LTM LTM LTM 2018 2019 2018 2019 2018 2019
HR Outsourcing
Aon plc $34,478 $38,127 88% $11,935 42% $2,555 7% 5% 3.6x 3.4x 13.1x 11.9x
Automatic Data Processing, Inc. 52,150 51,777 96% 12,542 43% 2,860 7% 7% 3.8 3.5 17.7 16.1
Barrett Business Services, Inc. 485 362 93% 897 61% 36 11% NA 0.4 NA 8.1 NA
CBIZ, Inc. 863 1,037 90% 839 12% 95 5% 4% 1.2 1.1 9.6 9.1
H&R Block, Inc. 5,482 6,695 82% 3,058 49% 910 2% 3% 2.2 2.1 8.0 7.9
Insperity, Inc. 2,391 2,165 95% 3,203 17% 156 10% 10% 0.6 0.5 10.9 9.9
Instructure, Inc. 1,002 935 90% 147 71% (33) 28% 28% 4.7 3.7 NM NM
Paychex, Inc. 24,604 23,918 97% 3,238 71% 1,453 7% 7% 6.9 6.5 15.8 14.8
TriNet Group, Inc. 3,170 3,323 98% 3,239 18% 267 (0%) 11% 4.1 3.7 11.9 10.6
WageWorks, Inc. 2,496 1,848 77% 462 63% 125 10% 10% 3.5 3.2 11.0 9.7
75th Percentile $19,824 $19,612 96% $3,238 63% $1,317 10% 10% 4.0x 3.7x 13.1x 12.7x
Median $2,833 $2,744 92% $3,131 46% $211 7% 7% 3.5x 3.4x 11.0x 10.3x
Mean $12,712 $13,019 91% $3,956 45% $842 9% 9% 3.1x 3.1x 11.8x 11.3x
25th Percentile $1,349 $1,240 88% $853 24% $103 5% 5% 1.4x 2.1x 9.6x 9.6x
29PIPER JAFFRAY
CRM / Marketing
Source: S&P Capital IQ, Thomson Reuter’s Consensus, and Renaissance Capital.
EV/Revenue > 20x Not Meaningful (NM).
EV/EBITDA > 60x Not Meaningful (NM).
Market Enterprise Gross Revenue EV / EV /
Cap Value Price % Revenue Margin EBITDA Growth Revenue EBITDA
($ in millions, except per share data) 12/29/2017 12/29/2017 52 Wk High LTM LTM LTM 2018 2019 2018 2019 2018 2019
CRM / Marketing
Callidus Software Inc. 1,951 1,775 94% 240 61% 27 18% 21% 5.9 4.9 36.7 27.5
ChannelAdvisor Corporation 239 186 59% 120 78% 6 10% 9% 1.4 1.3 26.1 14.0
Coupa Software Incorporated 1,719 1,499 83% 171 68% (14) 24% 24% 6.6 5.4 NM NM
Marin Software Incorporated 62 34 57% 80 59% (11) NA NA NA NA NA NA
Mimecast Limited 1,643 1,551 90% 222 74% 19 29% 19% 5.3 4.4 NM 41.1
MINDBODY, Inc. 1,422 1,212 84% 171 71% 4 26% 25% 5.3 4.2 NM 30.6
Model N, Inc. 462 462 94% 131 53% (18) 7% 8% 3.0 2.8 NM 33.6
Salesforce.com, inc. 75,457 73,746 94% 9,923 73% 1,557 20% 20% 5.9 4.9 26.3 21.3
SendGrid, Inc. 1,008 950 98% 103 74% 9 24% 25% 7.0 5.6 NM NM
The Trade Desk, Inc. 2,023 1,918 68% 278 79% 85 28% 25% 4.9 3.9 16.2 11.8
Zendesk, Inc. 3,435 3,118 94% 396 70% (7) 31% 28% 5.5 4.3 NM NM
75th Percentile $1,987 $1,846 94% $259 74% $23 27% 25% 5.9x 4.9x 28.9x 32.1x
Median $1,643 $1,499 90% $171 71% $6 24% 22% 5.4x 4.4x 26.2x 27.5x
Mean $8,129 $7,859 83% $1,076 69% $151 22% 20% 5.1x 4.2x 26.3x 25.7x
25th Percentile $735 $706 75% $126 64% ($9) 19% 19% 5.0x 4.0x 23.6x 17.7x
30PIPER JAFFRAY
Contact Center
Source: S&P Capital IQ, Thomson Reuter’s Consensus, and Renaissance Capital.
EV/Revenue > 20x Not Meaningful (NM).
EV/EBITDA > 60x Not Meaningful (NM).
Market Enterprise Gross Revenue EV / EV /
Cap Value Price % Revenue Margin EBITDA Growth Revenue EBITDA
($ in millions, except per share data) 12/29/2017 12/29/2017 52 Wk High LTM LTM LTM 2018 2019 2018 2019 2018 2019
Contact Center
8x8, Inc. $1,297 $1,129 84% $272 76% $21 16% 22% 3.4x 2.8x NM 29.4x
eGain Corporation 143 142 96% 58 63% 1 4% 9% 2.3 2.1 NM NA
Five9, Inc. 1,479 1,462 89% 189 60% 19 17% 18% 6.3 5.4 NM 48.4
LivePerson, Inc. 685 629 76% 218 73% 20 7% 10% 2.7 2.5 28.5 21.7
NICE Ltd. 5,582 5,534 99% 1,264 65% 321 7% 6% 3.8 3.6 13.3 12.2
Verint Systems Inc. 2,703 3,103 94% 1,112 63% 168 7% 5% 2.5 2.4 10.5 9.5
75th Percentile $2,397 $2,692 96% $902 71% $131 14% 16% 3.7x 3.4x 20.9x 29.4x
Median $1,388 $1,296 92% $245 64% $21 7% 9% 3.1x 2.6x 13.3x 21.7x
Mean $1,981 $2,000 90% $519 67% $92 10% 12% 3.5x 3.1x 17.4x 24.3x
25th Percentile $838 $754 85% $196 63% $19 7% 7% 2.6x 2.4x 11.9x 12.2x
31PIPER JAFFRAY
Security
Source: S&P Capital IQ, Thomson Reuter’s Consensus, and Renaissance Capital.
EV/Revenue > 20x Not Meaningful (NM).
EV/EBITDA > 60x Not Meaningful (NM).
Market Enterprise Gross Revenue EV / EV /
Cap Value Price % Revenue Margin EBITDA Growth Revenue EBITDA
($ in millions, except per share data) 12/29/2017 12/29/2017 52 Wk High LTM LTM LTM 2018 2019 2018 2019 2018 2019
Security
Akamai Technologies, Inc. $11,155 $10,398 91% $2,456 65% $836 8% 10% 3.9x 3.5x 10.4x 9.3x
CA, Inc. 13,929 14,029 91% 4,078 86% 1,314 3% 1% 3.3 3.2 8.5 8.3
Check Point Software Technologies L 17,217 13,352 87% 1,835 89% 999 5% 6% 6.8 6.5 12.7 11.9
CyberArk Software Ltd. 1,498 1,201 74% 246 84% 53 19% 17% 3.9 3.4 16.8 13.5
Everbridge, Inc. 840 792 98% 96 70% (6) 26% 24% 6.1 4.9 NM NM
Experian plc 15,264 18,453 96% 4,439 43% 1,615 4% 6% 3.8 3.6 11.2 10.6
FireEye, Inc. 2,621 2,512 79% 734 64% 17 NA NA NA NA NA NA
ForeScout Technologies, Inc. 1,209 1,338 98% 204 72% (47) 21% 21% 5.0 4.2 NM NM
Fortinet, Inc. 7,819 6,284 96% 1,441 74% 305 14% 13% 3.7 3.3 16.3 13.6
Imperva, Inc. 1,350 1,007 76% 309 80% 47 NA NA NA NA NA NA
MobileIron, Inc. 375 292 58% 173 82% (19) NA NA NA NA NA NA
NetScout Systems, Inc. 2,698 2,683 79% 1,104 72% 238 (7%) 3% 2.7 2.6 13.2 12.1
Okta, Inc. 2,610 2,387 76% 231 68% (65) 32% 34% 7.1 5.3 NM NM
Palo Alto Networks, Inc. 13,320 11,570 92% 1,869 72% 407 24% 17% 4.9 4.2 18.8 15.2
Parkit Enterprise Inc. 11 10 70% 2 100% 1 NA NA NA NA NA NA
Proofpoint, Inc. 4,353 4,274 91% 477 72% 60 23% 28% 6.4 5.0 47.8 33.4
Qualys, Inc. 2,392 2,049 95% 220 78% 80 17% 16% 7.6 6.6 20.7 17.7
Radware Ltd. 853 522 93% 205 81% 13 9% 9% 2.3 2.1 20.7 15.8
Rapid7, Inc. 819 734 92% 188 73% (21) 20% 17% 3.0 2.6 NM NM
SecureWorks Corp. 719 619 68% 466 52% (15) 9% 10% 1.2 1.1 NM 28.0
Splunk Inc. 11,718 10,733 98% 1,158 79% 104 25% 29% 6.9 5.4 NM 33.5
Symantec Corporation 18,716 21,439 82% 4,739 79% 1,516 2% 7% 4.4 4.1 9.1 8.3
Trend Micro Incorporated 887,091 690,889 97% 147,474 82% 52,773 7% 6% 4.4 4.1 12.4 11.7
Varonis Systems, Inc. 1,352 1,223 91% 199 90% 5 19% 17% 4.9 4.2 NM NM
VASCO Data Security International, In 554 392 88% 186 70% 13 8% 7% 1.9 1.8 19.1 14.1
VeriSign, Inc. 14,199 14,240 97% 1,156 83% 806 NA NA NA NA NA 15.3
Zix Corporation 241 208 66% 64 81% 17 8% NA 2.9 NA 9.5 NA
75th Percentile $12,519 $11,152 95% $1,638 82% $606 20% 17% 5.8x 4.9x 19.0x 15.8x
Median $2,610 $2,387 91% $466 78% $53 12% 13% 4.2x 4.1x 13.2x 13.6x
Mean $38,330 $30,875 86% $6,509 76% $2,261 13% 14% 4.4x 3.9x 16.5x 16.0x` 25th Percentile $846 $763 78% $201 71% $3 7% 7% 3.1x 3.2x 10.8x 11.7x
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Date of First Use 2/18