SOURCE: Software Equity Group, L.L.C.

Software Equity Group, L.L.C.

August 25, 2011 08:00 ET

Software M&A Valuations Soar; Public Software Company Market Valuations Approach Pre-Recession Highs; SaaS Exits Ramp Sharply

SAN DIEGO, CA--(Marketwire - Aug 25, 2011) - Software Equity Group (, an internationally ranked investment bank and M&A advisory serving the software and technology sectors, released its complimentary Q2 2011 Software Equity Industry Report assessing M&A transaction volumes, median exit valuations, most active software sectors and most active buyers in the second quarter. The report also analyzes how public software, Internet and software as a service (SaaS) market valuations benefited from the rebound in IT spending, record levels in Internet retail sales, and sharply higher online advertising spending. Also included are software IPOs in the second quarter and the current software IPO pipeline.

Report Highlights:

  • 2Q11 marked the sixth consecutive quarter the software industry's benchmark median exit EV/Revenue multiple was above 2.1x TTM revenue. Just how high did it climb?
  • Internet transactions have increased 43% year-over-year, and the median Internet exit valuation has tripled since 4Q10. What Internet subsectors are leading the charge?
  • 45 SaaS companies were acquired in 2Q11, accounting for 11.3% of all software transactions, up from 2.6% only two years ago. What SaaS product categories are on fire?
  • Mobile infrastructure and application software led all other M&A product categories in the second quarter. What technology titans are now aggressively pursuing the mobile space?
  • How did on-premise software companies perform in Q2? Have they benefited from increased IT enterprise spending, and how have their market valuations and stock prices fared as a result?
  • TTM revenue growth rates accelerated in 2Q11 for most software, Internet and SaaS companies. Did it come at the expense of EBITDA margins?
  • Nine software/SaaS/Internet companies were newly listed in Q2, and 13 have gone public since January 1, including several high profile entrants. Who are they? What were their IPO valuations? How did their stock prices perform by the close of the quarter?

Software Equity Group's Quarterly and Monthly Reports are widely recognized as the best way to keep your finger on the financial pulse of the software industry. As testament, our reports are now read and relied upon by more than twenty thousand software industry executives, entrepreneurs, venture capitalists, private equity investors and professional advisors in 72 countries around the globe.

To obtain your complimentary copy, please visit:

Contact Information

  • For more information:
    Brad Weekes
    (858) 509-2800