SEG Snapshot: 3Q19 SaaS M&A Update

SaaS M&A deal volume and valuations reached record levels in 3Q19, as deal volume surpassed 300 transactions and sellers posted a median multiple of 4.8x EV/Revenue. 

This 3Q19 SaaS M&A Update report by SEG includes historical deal volume by product category and vertical, valuation stats, most active buyers, notable deals, historical private equity activity, and more.

Report Highlights:

For the first time, M&A deal volume for the overall software industry (including SaaS, on-premise license model software, internet, and mobile deals) eclipsed 700 transactions in 3Q19.

• Specific to the SaaS M&A market, deal volume reached a historical high of 314 SaaS transactions in 3Q19, a 24.6% YoY increase from 3Q18’s 252 transactions. Annual deal volume is expected to reach approximately 1,100 – 1,200 deals by end of 2019.

• M&A targets with a vertical focus comprise approximately 42% of SaaS M&A transactions in 3Q19. Verticals with the highest deal count in 3Q19 include Healthcare (28 deals), Financial Services (18 deals), and Real Estate (12 deals).

• SaaS M&A transactions posted a strong median multiple of 4.8x EV/Revenue in 3Q19. The SaaS M&A revenue multiple has been trending up over the past few quarters, increasing from 4.3x EV/Revenue in 3Q18.

• The high multiple was driven by some notable mega-deals in 3Q19, including Splunk’s acquisition of SignalFX (21.0x EV/Revenue), Main Capital Partner’s acquisition of GBTEC (16.2x EV/Revenue), and VMware’s acquisition of Carbon Black (8.9x EV/Revenue).

• Private equity buyers drove M&A activity, composing 56.7% of SaaS M&A deals in 3Q19. Equity-backed strategic acquisitions noticeably increased over the past few quarters, making up 41.7% of SaaS M&A deals alone. In comparison, this buyer group only comprised 34.5% of deals in 3Q18.


Click here to read the full SEG 3Q19 SaaS M&A Update! 

Post Your Comment

Leave another comment.

In order to post a comment, you must complete the fields indicated above.

Post Your Comment Close

Thank you for your comment.

Thank you for submitting your comment, your opinion is an important part of

Your comment has been submitted for review and will be posted to this article as soon as it is approved.

Back to Article