The Software Industry Financial Report - Software Equity Groupsoftwareequity.com/Reports/2015_Software_Industry_Financial_Report.pdf · The Software Industry Financial Report. SOFTWARE

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15

An

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al

Software Equity Group, L.L.C.

12220 El Camino Real

Suite 320

San Diego, CA 92130

[email protected]

(858) 509-2800

The Software Industry

Financial Report

SOFTWARE EQUITY GROUP | 2015 ANNUAL SOFTWARE INDUSTRY FINANCIAL REPORTCopyright © Software Equity Group, LLC, All Rights Reserved 2

About Software Equity Group

Leaders in Software M&A 5

Extensive Global Reach 6

About Software Equity Group 7

Software Industry Macroeconomics

U.S and Global GDP 9

U.S. GDP and Unemployment 10

Global IT Spending 11

E-Commerce and Digital Advertising Spend 12

Stock Market Performance 13

Public Software Financial and Valuation Performance

The SEG Software Index 15

The SEG Software Index: Financial Performance 16-20

The SEG Software Index: Public Market Multiples 21-23

The SEG Software Index by Product Category 24

The SEG Software Index by Product Category: Financial Performance 25

The SEG Software Index by Product Category: Public Market Multiples 26

Public SaaS Company Financial and Valuation Performance

The SEG SaaS Index 28

The SEG SaaS Index: Financial Performance 29-33

The SEG SaaS Index: Public Market Multiples 34-37

The SEG SaaS Index by Product Category: Financial Performance 38

The SEG SaaS Index by Product Category: Public Market Multiples 39

Public Internet Company Financial and Valuation Performance

The SEG Internet Index 41

The SEG Internet Index: Financial Performance 42-46

The SEG Internet Index: Public Market Multiples 47-49

The SEG Internet Index by Product Category 50

The SEG Internet Index by Product Category: Financial Performance 51

The SEG Internet Index by Product Category: Public Market Multiples 52

SOFTWARE INDUSTRY FINANCIAL REPORT CONTENTS


SOFTWARE INDUSTRY FINANCIAL REPORT CONTENTS

Software/SaaS/Internet IPO

Annual Software IPO Trends 54

2014 Software IPO Data 55

Venture Capital Activity: All Industry Sectors 56

Venture Capital Activity: Software 57

The Buyers Speak: Software Equity Group’s 2015 Annual M&A Survey

Results Summary 59-61

Results 62-64

Software Industry M&A Market Update

Software/SaaS M&A Deal Volume and Spending 66

Software M&A Exit Multiples 67-68

Software M&A by Ownership Structure and Size 69

Software M&A by Vertical and Horizontal Markets 70

Software M&A Deal Volume by Product Category 71

Software M&A Exit Valuations by Product Category 72

SaaS M&A Deal Volume and Exit Multiples 73-74

SaaS M&A by Product Category 75

Internet M&A: Deal Volume and Exit Multiples 76

Internet M&A: By Product Category 77

Appendix

SEG Software Index Key Metrics 79-82

SEG Software Index Key Metrics by Product Category 83-84

SEG SaaS Index Key Metrics 85-86

SEG SaaS Index Key Metrics by Product Category 87

SEG Internet Index Key Metrics 88-90

SEG Internet Index Key Metrics by Product Category 91

2014 Select Public Sellers 92

2014 Mega Deals 93-94

2014 Most Active Buyers 95-102

Select SaaS Transactions 103-114

About Software Equity Group 115

SOFTWARE EQUITY GROUP | 2015 ANNUAL SOFTWARE INDUSTRY FINANCIAL REPORTCopyright © Software Equity Group, LLC, All Rights Reserved

ABOUT SOFTWARE EQUITY GROUP


• Industry leading boutique investment bank, founded in 1992, representing public and private software and internet companies seeking:

• Strategic exit• Growth capital• Buyout • Inorganic growth via acquisition• Buy and sell-side mentoring• Fairness opinions and valuations

• Sell-side client revenue range: $5 - 75 million

• Buy-side clients include private equity firms and NASDAQ, NYSE and foreign exchange listed companies

• Clients span virtually every software technology, product category, delivery model and vertical market

• Global presence providing advice and guidance to more than 2,000 private and public companies throughout US, Canada, Europe, Asia-Pacific, Africa and Israel

• Strong cross-functional team leveraging transaction, operating, legal and engineering experience

• Unparalleled software industry reputation and track record.

• Highly referenceable base of past clients

We Do Deals.

LEADERS IN SOFTWARE M&A


SEG Research Distribution

Current Sell-side Representation

Recent Sell-side Representation

• SEG currently represents software companies in the United States, Canada, France, Germany, Australia & Saudi Arabia

• In addition to the countries listed above, SEG has recently represented software companies in the United Kingdom, France, Netherlands, Israel, and South Africa

• SEG’s Quarterly and Annual Software Industry Equity Reports and Monthly Flash Reports are distributed to an opt-in list of 70,000 public software company CEOs, software entrepreneurs, private equity managing directors, VCs, high tech corporate lawyers, public accountants, etc. in 78 countries.

EXTENSIVE GLOBAL REACH


Software Equity Group is an investment bank and M&A advisory serving the software and technology sectors. Founded in 1992, our firm has guided and advised companies on five continents, including privately-held software and technology companies in the United States, Canada, Europe, Asia Pacific, Africa and Israel. We have represented public companies listed on the NASDAQ, NYSE, American, Toronto, London and Euronext exchanges. Software Equity Group also advises several of the world's leading private equity firms. We are ranked among the top ten investment banks worldwide for application software mergers and acquisitions.

Our value proposition is unique and compelling. We are skilled and accomplished investment bankers with extraordinary software, internet and technology domain expertise. Our industry knowledge and experience span virtually every software product category, technology, market and delivery model, including Software-as-a-Service (Saas), software on-demand and perpetual license. We have profound understanding of software company finances, operations and valuation. We monitor and analyze every publicly disclosed software M&A transaction, as well as the market, economy and technology trends that impact these deals. We're formidable negotiators and savvy dealmakers who facilitate strategic combinations that enhance shareholder value.

Perhaps most important are the relationships we've built and the industry reputation we enjoy. Software Equity Group is known and respected by publicly traded and privately owned software and technology companies worldwide, and we speak with them often. Our Quarterly and Annual Software Industry Equity Reports are read and relied upon by more than thousands of industry executives, entrepreneurs and equity investors in sixty-one countries, and we have been quoted widely in such leading publications as The Wall Street Journal, Barrons, Information Week, The Daily Deal, The Street.com, U.S. News & World Report, Reuters, Mergers & Acquisitions, USA Today, Arizona Republic, Detroit Free Press, Entrepreneur Magazine, Softletter, Software Success, Software CEO Online and Software Business Magazine.

To keep your finger on the pulse of the software equity markets, subscribe to our Annual and Quarterly Research Reports.

Software Equity Group is an investment bank and M&A advisory serving the software and technology sectors. For a confidential consultation without obligation, please contact Kris Beible, Director, Business Development (858) 509-2800, [email protected] .

CONTACT INFORMATION:

Software Equity Group, L.L.C.12220 El Camino Real, Suite 320San Diego, CA 92130www.softwareequity.comp: (858) 509-2800

The information contained in this Report is obtained from sources we believe to be reliable, but no representation or guarantee is made about the accuracy or completeness of such information, or the opinions expressed herein. Nothing in this Report is intended to be a recommendation of a specific security or company or intended to constitute an offer to buy or sell, or the solicitation of an offer to buy or sell, any security. Software Equity Group LLC may have an interest in one or more of the securities or companies discussed herein. Financial data provided by Capital IQ.

This Report may not be reproduced in whole or in part without the expressed prior written authorization of Software Equity Group, L.L.C.Software Equity Group registers each Report with the U.S. Copyright Office and vigorously enforces its intellectual property rights.


7


SOFTWARE INDUSTRY MACROECONOMICS


U.S. AND GLOBAL GDP

U.S. GDP (% YoY Change)Global GDP (% YoY Change)

Sources: IMF Worldbank, The Economist, Council of Economic Advisors, and Statista

• Worldwide GDP growth remained flat for the third consecutive year.

• In an update to its "World Economic Outlook", the IMF predicted the global economy will have grown 3.7 percent in 2014, beating lastOctober’s 3.6 percent growth forecast by just a hair. Global growth in 2015 and 2016 is projected at 3.5 and 3.7 percent, respectively, 0.3percent lower than the IMF’s October 2014 WEO.

• The latest IMF forecast for 2015 projects a gradually improving global economy that will remain vulnerable to a host of economic andgeopolitical risks, including deflation in Europe and Japan, slower growth in China, a declining Euro and resurgent U.S. Dollar, lower oilprices, and continuing geopolitical upheavals and renewed fears of default by Greece stemming from recent election results.

• Globally, GDP is expected to inch up to 3.5% in 2015 and 3.7% in 2016. GDP growth in developed nations is expected to grow at a median of2.4% in both 2015 and 2016, a modest improvement over 2014’s 1.8%. These projections were revised downward by 0.3% from the IMF’sOctober 2014 World Economic Outlook in response to a host of mostly negative developments. The United States is the only major economyfor which growth projections have been raised.

3.40%

2.70%

1.80%

-0.30%

-2.80%

2.50%

1.60%

2.30% 2.20%2.40%

-4%

-3%

-2%

-1%

0%

1%

2%

3%

4%

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Annual growth of the Real Gross Domestic Product (GDP) of the United Stats from 2006 to 2014

4.88%

5.56% 5.67%

3.04%

0.10%

5.43%

4.14%

3.37% 3.28% 3.31%

0%

1%

2%

3%

4%

5%

6%

7%

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Growth of the global gross demestic product (GDP) from 2004 to 2014 (compared to the previous year)


U.S. GDP AND UNEMPLOYMENT

• According to November’s Federal Reserve survey of 43 economists, GDP growth in the U.S. for 4Q14 is forecast to be 3.1%. For the year,expectations are that the U.S. economy grew 2.2% in 2014, up from 2.0%. A surprisingly weak first half tempered earlier expectations for amore robust U.S. annual growth rate in 2014.

• 2015’s growth outlook also calls for further reduction in the U.S. unemployment rate. Economic forecasters predict unemployment, whichaveraged 6.2 percent in 2014, will fall to 5.6 percent in 2015, and decline further to 5.4 percent in 2016 and 5.2 percent in 2017.

• On a quarterly basis, the Labor Department reported 5.6% unemployment at the end of 4Q14. a marked improvement from 1Q14’s 6.6%unemployment rate, and the lowest since 2008.

• The labor participation rate showed minimal decline, edging down slightly to 62.7% in December, a 35 year low that can be attributed to anaging population of baby boomers that are beginning to retire. This leads to a natural demographic decline in the participation rate.


GLOBAL IT SPENDING

Sources: Global IT spending chart is a blended average of Goldman Sachs, IDC, Forrester, and Gartner forecasts. IT Spending by Category chart from Forrester.

• At the outset of 2014, analysts at Goldman Sachs, Gartner and elsewhere projected Global IT spending in 2014 would increase 4.0%, a notableimprovement from the tepid 2.0% growth that has prevailed over the past two years. The forecast proved far too optimistic due to a weakfirst half; global IT spending is estimated to have grown only 2.1% in 2014.

• Gartner projects worldwide IT spending will grow 2.4% in 2015, and exceed $3.8 trillion. By 2018, spending is forecast to be greater than $4.1trillion. After accounting for exchange rate fluctuations, the corresponding 2015 constant-currency growth rate is predicted to be 3.7%.

• Forrester estimates software will account for 27% of all tech spending, leading all other categories. According to Forrester, “Software’sleading position is not a surprise, because it is the focal point for tech innovation today, whether that innovation takes the form of cloudcomputing and adoption of SaaS, PaaS, smart computing and big data, real-time predictive analytics and smart process apps, or mobilecomputing and mobile apps and enterprise app stores.”

Global IT Spending by CategoryGlobal IT Spending (% YoY Change)

6.0%

-10.0%

8.0%

6.0%

2.0% 2.0% 2.1%

3.7%

2008 2009 2010 2011 2012 2013 2014 2015 (F)


E-COMMERCE AND DIGITAL ADVERTISING SPEND

Sources: comScore, IAB, IBD, and Forrester

• E-commerce retail sales in the U.S. totaled $78.1 billion in 3Q14 (the latest data available), up 11% YoY. The increase marks the twentiethconsecutive quarter of YoY growth, and the sixteenth consecutive quarter of double digit growth.

• The Q3 total for E-Commerce spending accounted for 6.6% of all discretionary retail dollars spent.

• Mobile commerce accounted for $6.7 billion, or 11.1% of the 2014 E-Commerce total, according to comScore. In addition, YoY growth inmobile commerce grew 16%.

• The digital commerce growth rate of 14% in Q4 far exceeded the 3% growth in total consumer discretionary spending, confirming that theshift to online continues unabated.

• According to Forrester, U.S. digital ad revenues will total $37.6 billion in 2019, with the most growth coming from video advertising.Forrester predicts video advertising on desktop devices alone will grow 14% annually until 2019, when it will contribute 55% of totaldesktop display ad revenue across the Web.

U.S. Digital Advertising SpendU.S. E-Commerce Spend


STOCK MARKET PERFORMANCE

• Technology stock prices recovered some ground in 4Q14, especially high-growth, SaaS based and Internet companies that had beenstruggling to recapture pre-recession growth rates.

• The Nasdaq posted the best return of the three major stock indices in 2014, finishing up 13.4%. The S&P followed closely behind, endingthe year +11.4%. Surprisingly, in an environment where investors flocked to value stocks in 1H14, the DOW performed worst among thethree major U.S. stock market indices, yet still managed to close 2014 with a respectable gain of 7.5%.

• The SEG Internet Index posted the greatest 2014 decline in median stock return among our six tracking indices. In 1Q14, our Internet Indexperformance remained relatively flat, only to plunge dramatically in the second quarter. The SEG Internet Index failed to recover in Q3 andQ4, closing 2014 10.6% lower than a year earlier, the worst performance among our three software industry tracking indices.

• The SEG Software Index, consisting largely of mature, profitable software providers remained even, finishing the third quarter only 0.4%,lower, after declining by 8.4% in May, its lowest point for the year.

• The SEG SaaS Index declined 5% in 2014, perhaps because of investors taking profits after a prolonged period of strong returns from highbeta/growth public SaaS companies which drove valuations to historically high levels, and/or perhaps because investors were disappointedwith the failure of SaaS providers to recapture pre-Recession 40%+ growth rates.


THE SEG SOFTWARE INDUSTRY FINANCIAL REPORT

PUBLIC SOFTWARE COMPANY FINANCIAL PERFORMANCE AND MARKET MULTIPLE TRENDS


THE SEG SOFTWARE INDEX

• The SEG Software Index tracks public software companies that primarily offer on-premise software under a perpetual licensewith annual M&S.

• The SEG Software Index is currently comprised of 140 public software companies.

• The number of public companies comprising the SEG Software Index has declined significantly (from ~465) and steadily over thepast 15 years, as a wide array of on premise providers have migrated to a SaaS business model.


THE SEG SOFTWARE INDEX: FINANCIAL PERFORMANCE

Median Revenue Growth - AnnualMedian TTM Total Revenue ($M) - Annual

• On an annualized basis, the median TTM revenue growth rate of public on premise software providers was 8.0% in 2014, the slowestgrowth rate in four years.

• Public on premise software companies were hard hit by the Great Recession, primarily as a result of severe cutbacks in enterprise ITspending, resulting in anemic median TTM revenue growth rates of 4.2% and 4.5% in 2009 and 2010, respectively. Pent up demand, soaringstock prices and optimism about a near term recovery spurred IT spending in 1H11, but the surge dissipated in the second half and hasremained lackluster since. We expect on premise software growth rates will see further decline, absent a significant uptick in capital ITspending by larger enterprises, which is not expected.

• Despite the tepid TTM growth rate, the median TTM revenue of the SEG Software Index reached $535.8M in 4Q14, the highest in history, andthe highest among our three tracking indices. We attribute much of that growth to consolidated revenue from mergers and acquisitions, andrevenue model optimization.

$239.8

$387.9 $381.4

$470.5

$535.8

2010 2011 2012 2013 2014

TT

M T

ota

l R

ev

en

ue

4.2% 4.5%

16.1%

13.3%

9.3%

8.0%

2009 2010 2011 2012 2013 2014

TT

M R

ev

en

ue

Gro

wth


21%

33%

21%

11%

5%

8%

<= 0% > 0%<= 10%

> 10%<= 20%

> 20%<= 30%

> 30%<= 40%

> 40%

% o

f C

om

pa

nie

s

TTM Revenue Growth


• When assessed on a quarterly basis, the median TTM revenuegrowth of public on premise software providers reveals atroubling trajectory that does not portend well for the future.Q4 was the fifth consecutive quarter of decelerated growth forpublic on premise software providers .

• More than one in five reported negative growth.

• 13% of on-premise software providers reported TTM revenuegrowth rates of 30% or more in 4Q14. Most were focused onthree of 2014’s hottest product categories, Mobility (NQMobile), Security (Palo Alto Networks), and SystemsManagement (Solarwinds).

TTM Revenue Growth Rate Distribution – 4Q14Median Revenue Performance – Quarterly

17

7.0%

7.5%

8.0%

8.5%

9.0%

9.5%

$0

$100

$200

$300

$400

$500

$600

4Q13 1Q14 2Q14 3Q14 4Q14

TT

M R

ev

en

ue

Gro

wth

TT

M T

ota

l R

ev

en

ue

TTM Total Revenue ($M) TTM Revenue Growth



Median EBITDA Margin – AnnualMedian Gross Profit Margin – Annual

• The median gross margin of public on premise providers was 66.0% in 2014, consistent with historic levels.

• During the economic downturn, most public on premise companies shifted focus from unattainable revenue growth to EBITDA, whichimproved each year from 2007 to 2011, when it topped out at 18.9%.

• As economic woes eased, on premise providers began to invest more heavily in sales, marketing and R&D and, concomitantly, the medianEBITDA margin declined modestly to ~17.5% for the past two years.

• We anticipate EBITDA margins will continue to experience modest decline in 2015, as on-premise providers increase spending on sales andmarketing and invest more in R&D to update legacy products and expand their SaaS offerings.

66.0%66.5% 66.6%

68.6%

65.8%66.1%

66.5%66.0%

2007 2008 2009 2010 2011 2012 2013 2014

Gro

ss P

rofi

t M

arg

in

11.2%

13.0%

15.3%

17.4%

18.9%

17.9%17.5% 17.6%

2007 2008 2009 2010 2011 2012 2013 2014

EB

ITD

A M

arg

in


21%

12%

26%

24%

13%

4%

<= 0% > 0%<= 10%

> 10%<= 20%

> 20%<= 30%

> 30%<= 40%

> 40%

% o

f C

om

pa

nie

s

TTM EBITDA Margin


• Viewed on a quarterly basis, the median EBITDA margin ofpublic on-premise software companies remained relativelysteady throughout last year, closing 4Q14 at 17.0%.

• 50% of public on-premise software providers were modestly tomoderately profitable, posting EBITDA margins between 10%and 30%.

• Only 4% of on-premise software companies achieved EBITDAmargins of 40%+; most were larger companies with little ornegative growth that generated significant, lower cost revenuefrom their installed base (e.g., Oracle – 3.3% revenue growth,CheckPoint – 6.3% revenue growth, Ansys, 8.5% revenuegrowth)

TTM EBITDA Margin Distribution – 4Q14Median EBITDA Margin Performance – Quarterly

19

0%

1%

2%

3%

4%

5%

6%

7%

8%

0%

2%

4%

6%

8%

10%

12%

14%

16%

18%

20%

4Q13 1Q14 2Q14 3Q14 4Q14

TT

M R

ev

en

ue

Gro

wth

TT

M E

BIT

DA

Ma

rgin

EBITDA Margin TTM EBITDA Growth



Median Margin Performance – QuarterlyMedian Operating Ratios – Quarterly

• In 4Q14, the median gross profit of public on premise softwarecompanies was 66%; EBITDA was 17%; and net income was8.6%.

• Several on-premise providers achieved gross profit margins of90% or greater, including Sage Group (94.3%); ProgressSoftware (91.2%); and Varonis Systems (90.3%).

• As predicted in last year’s Annual Report, EBITDA marginsdeclined modestly throughout 2014, as on premise companiesramped spending on S&M, R&D and SaaS migration. Weexpect this trend will continue in 2015.

• Median spending on operations by public on-premise softwarecompanies in Q4 was consistent with historic norms: 16.2%for Research & Development, 23.5% for Sales & Marketing, and10.3% for General & Administrative.

• Over the past year, S&M, R&D and G&A expenses as a percentof revenue have remained flat.

• Median S&M spending as a percent of total revenue by on-premise public software companies lagged far behind theirSaaS counterparts, which continued to place significant bets onnew customer acquisition (39.7% for SaaS ,and 23.5% for on-premise).

0%

5%

10%

15%

20%

25%

30%

4Q13 1Q14 2Q14 3Q14 4Q14

% o

f R

ev

en

ue

S&M (% of Revenue) R&D (% of Revenue) G&A (% of Revenue)

0%

10%

20%

30%

40%

50%

60%

70%

80%

4Q13 1Q14 2Q14 3Q14 4Q14

% M

arg

in

Gross Profit Margin EBITDA Margin Net Income Margin


Median EV/EBITDA – AnnualMedian EV/Revenue – Annual

• Ignoring the faltering financial performance of most publicly listed on premise software providers, investors drove the trading multiples ofmany to a seven year high.

• After plunging to 1.5x in 2009, median EV/Revenue multiples for public on-premise software companies climbed steadily to 3.0x by theclose of 2014. Their median EV/ EBITDA multiple reached 15x, a seven year high.

• Investors in 2014 were clearly betting on the ability of on premise providers to capitalize on their immense customer base as the economyimproves, as well as the promise of greater recurring revenue from a growing number of hosted solution subscriptions.

• Adobe is an excellent example. As the company converts to a SaaS model, its revenue growth rate has rapidly decelerated (from 29.0% in2010, to 11.0% in 2011, to 4.4% in 2012, to -7.9% in 2013, and 2.3% in 2014), yet its EV/Revenue multiple has grown from 2.9x to 8.1x overthe same period due to its steadily growing recurring revenue.

2.3x

1.7x

1.5x

2.3x

2.7x 2.7x

3.0x 3.0x

2007 2008 2009 2010 2011 2012 2013 2014

EV

/R

ev

en

ue

Mu

ltip

le

14.1x

11.7x

10.0x

12.4x 12.3x 11.9x

14.0x15.0x

2007 2008 2009 2010 2011 2012 2013 2014

EV

/E

BIT

DA

Mu

ltip

le

THE SEG SOFTWARE INDEX: PUBLIC MARKET MULTIPLES


• Throughout 2014, the EV/Revenue multiples of on-premisesoftware companies with revenues <$100 million remainedmarkedly lower than their larger >$100 million counterparts.

• SEG Software Index companies with TTM revenue between$500M and $1B successfully balanced TTM revenue growth(median 8.5%) and profitability (median EBITDA of 13.5%),and were rewarded with the highest median EV/Revenuemultiples.


• Viewed quarter-by-quarter, the median EV/Revenue multiplefor on-premise software providers held mostly steadythroughout 2014, ending Q4 at 2.9x.

• Though the median EV/EBITDA multiple of public on premisesoftware companies fluctuated over the course of the year anddeclined at year end. Q4’s median multiple of 15.2x was stillgreater than any quarter from 2008 – 3Q13.

EV/Revenue Multiples by Size (TTM Revenue) – QuarterlyMedian EV/Revenue and EV/EBITDA Multiples – Quarterly

22

3.3x 3.0x 3.1x 2.9x 2.9x

15.9x14.8x

15.8x 15.9x15.2x

4Q13 1Q14 2Q14 3Q14 4Q14

Me

dia

n M

ult

ipe

EV/Revenue EV/EBITDA

0.0x

0.5x

1.0x

1.5x

2.0x

2.5x

3.0x

3.5x

4.0x

4Q13 1Q14 2Q14 3Q14 4Q14

Me

dia

n E

V/

Re

ve

nu

e

Revenue Greater Than $1 billion Revenue Between $500 million & $1 billion

Revenue Between $100 million & $500 million Revenue Less Than $100 million



• In a departure from prior quarters, market valuations of SEGSoftware Index companies did not correspond closely to theirTTM revenue growth rates.

• Public on-premise software companies with revenue growthrates greater than 40% were penalized by investors with amedian EV/Revenue multiple of 3.1x. Most likely, investorsfeared the inability of these providers to deliver, scale andsustain the growth.

• Members of Q4’s 40%+ growth club included: Redknee(81.4%), Take-Two Interactive (129%), NQ Mobile (95.4%),King Digital (73.1%), Glu Mobile (90.7%).

• Investors in 4Q 2014 continued to place a premium on thebottom line of on premise software companies, rewardingthose with TTM EBITDA margins greater than 20% withmarkedly higher market multiples than their less profitablecounterparts.

• Investors in Q4 took special note of on-premise providers withEBITDA margins greater than 40%, conferring upon them aSaaS-like median EV/Revenue multiple of 6.6x.

EV/Revenue Multiples vs. TTM EBITDA Margins – 4Q14EV/Revenue Multiples vs. TTM Revenue Growth – 4Q14

23

1.9x

2.8x

3.6x 3.8x4.0x

3.1x

<= 0% > 0%<= 10%

> 10%<= 20%

> 20%<= 30%

> 30%<= 40%

> 40%

Me

dia

n E

V/

Re

ve

nu

e

TTM Revenue Growth

1.6x1.9x

2.6x

3.4x 3.5x

6.6x

<= 0% > 0%<= 10%

> 10%<= 20%

> 20%<= 30%

> 30%<= 40%

> 40%

Me

dia

n E

V/

Re

ve

nu

e

TTM EBITDA Margin


THE SOFTWARE INDEX: BY PRODUCT CATEGORY

• The SEG Software Index is segmented into 16 product categories

• As in prior quarters, market valuations in 2014 varied significantly by product category

• For a list of companies in each product category, please see the Appendix to this Report

4Q13 1Q14 2Q14 3Q14 4Q14 4Q13 1Q14 2Q14 3Q14 4Q14 4Q13 1Q14 2Q14 3Q14 4Q14 4Q13 1Q14 2Q14 3Q14 4Q14

Billing & Service Management 3.0x 2.2x 1.9x 2.0x 1.8x 9.4x 10.2x 11.2x 9.6x 9.4x 4.4% 3.6% 4.8% 8.2% 12.9% 18.6% 18.5% 18.4% 21.1% 26.1%

Business Intelligence 3.1x 3.2x 3.0x 3.3x 3.2x 16.3x 14.8x 16.9x 15.8x 14.4x 7.5% 10.2% 13.3% 14.2% 12.5% 16.2% 15.9% 15.8% 14.4% 12.6%

Development Platforms 2.2x 2.1x 1.6x 1.5x 1.6x 10.9x 9.7x 10.1x 21.7x 9.9x 2.3% -0.6% -1.8% 0.0% 1.6% 20.0% 19.6% 19.2% 19.0% 19.0%

Engineering & PLM 3.9x 3.8x 4.2x 3.4x 3.3x 15.8x 15.2x 15.9x 15.9x 15.4x 6.8% 7.1% 7.2% 6.9% 6.2% 20.5% 20.7% 19.9% 19.5% 19.4%

Enterprise Resource Planning 3.7x 3.6x 3.4x 3.1x 3.3x 12.8x 12.3x 11.7x 10.6x 11.5x 2.7% 2.0% 2.7% 3.0% 2.9% 29.1% 29.3% 29.5% 29.0% 28.4%

Financial & Accounting 3.7x 3.6x 3.4x 3.2x 3.3x 14.7x 15.1x 14.0x 14.1x 13.8x 10.7% 8.5% 4.7% 2.5% 6.1% 26.7% 25.9% 25.6% 26.0% 25.2%

Gaming 1.7x 1.9x 1.5x 1.2x 1.3x 13.0x 11.4x 12.1x 9.8x 10.0x 10.7% -3.6% -4.8% 0.2% 3.1% 13.6% 17.7% 15.9% 15.5% 19.2%

Healthcare 2.5x 2.3x 2.3x 2.4x 2.4x 15.6x 14.5x 14.1x 16.3x 14.6x 3.1% 3.0% 0.1% 1.1% 3.2% 16.8% 15.0% 14.1% 14.1% 16.6%

IT Conglomerates 3.1x 3.2x 3.7x 3.6x 3.6x 8.5x 8.9x 9.6x 9.6x 9.5x 0.9% 2.0% 2.7% 2.2% 2.9% 33.2% 34.2% 34.4% 34.5% 35.1%

Mobile Solutions/Content 3.7x 2.8x 3.5x 3.5x 3.2x 19.9x 29.7x 26.6x 20.2x 18.5x 27.3% 24.9% 17.9% 21.1% 22.0% 6.3% 3.7% 2.5% -0.3% 0.7%

Networking & Network

Performance Management3.4x 3.1x 2.7x 2.3x 2.3x 18.6x 15.7x 18.9x 18.0x 16.8x 7.6% 11.6% 10.1% 10.8% 15.4% 3.0% 1.7% 2.3% 4.4% 7.0%

Security 4.2x 3.3x 3.5x 5.4x 5.0x 14.1x 10.7x 15.1x 16.9x 16.6x 17.0% 17.5% 16.5% 15.2% 18.9% 2.4% 10.6% 10.9% 12.5% 7.6%

Storage, Data Management &

Integration2.6x 2.4x 2.5x 2.6x 2.6x 9.5x 8.0x 8.9x 9.1x 9.1x 4.6% 4.1% 2.9% 2.1% 3.1% 16.9% 17.8% 18.0% 17.7% 17.5%

Systems Management 5.2x 4.6x 5.3x 4.6x 4.4x 19.2x 17.8x 20.0x 18.2x 18.5x 15.3% 13.0% 13.3% 15.8% 16.2% 24.2% 25.9% 25.7% 25.3% 25.0%

Vertical - Finance 4.5x 4.3x 4.5x 4.4x 4.4x 13.9x 13.4x 13.5x 13.7x 13.8x 6.8% 8.2% 8.1% 6.3% 5.6% 26.0% 26.7% 26.8% 29.3% 29.9%

Vertical - Other 3.3x 3.3x 3.5x 3.9x 3.7x 24.4x 25.7x 26.5x 28.3x 27.0x 24.9% 21.2% 21.2% 16.6% 16.5% 13.8% 12.9% 11.3% 11.6% 11.8%

Median 3.3x 3.0x 3.1x 2.9x 2.9x 15.9x 14.8x 15.8x 15.9x 15.2x 9.0% 8.7% 8.6% 8.1% 7.8% 17.5% 17.2% 17.0% 16.6% 17.0%

SEG Software Index

CategoryEV/Revenue EV/EBITDA TTM Revenue Growth EBITDA Margin


THE SEG SOFTWARE INDEX BY PRODUCT CATEGORY:FINANCIAL PERFORMANCE

4Q14 YoY Change in Median Revenue Growth4Q14 Median TTM Revenue Growth

4Q14 YoY Change in Median EBITDA Margin4Q14 Median TTM EBITDA Margin

196.2%

66.0%

(30.9%)

(8.1%)

6.4%

(42.7%)

(71.0%)

2.7% 229.6%

(19.2%)

104.1%

10.7%

(32.9%)

5.9%

(18.5%)

(33.6%)

Billing & Service Management

Business Intelligence

Development Platforms

Engineering & PLM

Enterprise Resource Planning

Financial & Accounting

Gaming

Healthcare

IT Conglomerates

Mobile Solutions/Content

Networking & Network Performance…

Security

Storage, Data Management & Integration

Systems Management

Vertical - Finance

Vertical - Other

12.9%

12.5%

1.6%

6.2%

2.9%

6.1%

3.1%

3.2%

2.9%

22.0%

15.4%

18.9%

3.1%

16.2%

5.6%

16.5%




Engineering & PLM



Gaming

Healthcare

IT Conglomerates



Security


Systems Management

Vertical - Finance

Vertical - Other

26.1%

12.6%

19.0%

19.4%

28.4%

25.2%

19.2%

16.6%

35.1%

0.7%

7.0%

7.6%

17.5%

25.0%

29.9%

11.8%




Engineering & PLM



Gaming

Healthcare

IT Conglomerates



Security


Systems Management

Vertical - Finance

Vertical - Other

40.5%

(22.3%)

(5.0%)

(5.5%)

(2.4%)

(5.5%)

40.8%

(1.0%)

5.8%

(88.2%) 137.5%

217.2% 3.6%

3.3%

15.0%

(14.8%)




Engineering & PLM



Gaming

Healthcare

IT Conglomerates



Security


Systems Management

Vertical - Finance

Vertical - Other


• In 4Q14, ten product categories surpassed the overall SEG Software Index of 2.9x: Security (5.0x), Vertical – Finance (4.4x), Systems Mgmt(4.4x), Financial & Accounting (3.3x), Vertical – Other (3.7x), Engineering & PLM (3.3x), ERP (3.3x), Mobile Solutions (3.2x), BusinessIntelligence (3.2x), IT Conglomerates (3.6x)

• While all but two on premise product categories saw their YoY EV/Revenue multiple grow by year end 2013, only four categories managedto do so in 4Q14: Security (21.1%), IT Conglomerates (13.9%), Vertical-Other (12.3%) and Business Intelligence (6.0%) .

• Security, with the second highest TTM revenue growth rate of any on premise product category (18.9%), drove its YoY median EV/Revenuemultiple from 4.2x to 5.0x in 2014. Not all categories fared as well: Although the median TTM revenue growth of Networking & NetworkPerformance Management software providers increased from 7.6% in Q1 to 15.4% in Q4, their median market multiple plummeted to 2.3xfrom 3.4x EV/Revenue during the same period.

• The Gaming and Development platforms categories posted the lowest EV/Revenue multiples in 4Q14, 1.3x and 1.6x, respectively. due toslowed growth.

THE SEG SOFTWARE INDEX BY PRODUCT CATEGORY:PUBLIC MARKET MULTIPLES

Median 4Q14 YoY Change in EV/Revenue4Q14 Median EV/Revenue Multiples

1.8x

3.2x

1.6x

3.3x

3.3x

3.3x

1.3x

2.4x

3.6x

3.2x

2.3x

5.0x

2.6x

4.4x

4.4x

3.7x




Engineering & PLM



Gaming

Healthcare

IT Conglomerates



Security


Systems Management

Vertical - Finance

Vertical - Other

(37.8%)

6.0%

(27.9%)

(14.2%)

(11.5%)

(11.5%)

(23.5%)

(2.1%)

13.9%

(12.3%)

(33.7%)

21.1%

(3.0%)

(15.6%)

(4.0%)

12.3%




Engineering & PLM



Gaming

Healthcare

IT Conglomerates



Security


Systems Management

Vertical - Finance

Vertical - Other


THE SEG SaaS INDEX

PUBLIC SaaS COMPANY FINANCIAL PERFORMANCE AND MARKET MULTIPLE TRENDS


THE SEG SaaS INDEX

• The SEG SaaS Index tracks public companies that primarily offer hosted, on-demand software under a subscription and/ortransaction based pricing model.

• The SEG SaaS Index is currently comprised of 57 publicly traded, pure-play SaaS companies*.

* See Appendix for complete list of companies in the SEG SaaS Index


THE SEG SaaS INDEX: FINANCIAL PERFORMANCE

Median Revenue Growth - Annual Median TTM Total Revenue ($M) - Annual

• After achieving a median TTM growth rate of 51% in 2007, SaaS providers were hit hard by the recession. By 2010 the median TTM revenuegrowth of the SEG SaaS index had plummeted to 14.2%, before regaining some traction in 2011 and hovering around 26% during thefollowing two years. 2014 showed further improvement, with public SaaS companies posting a median 28.4% growth rate

• Median TTM revenue in 2014 fell to $128.7M from $163.5M in 2013, primarily due to two contributing factors: First, several larger SaaSproviders were acquired, including Concur ($668M TTM revenue) and OpenTable ($198M TTM revenue); Second, eight newly listed SaaSproviders, with median TTM revenue of ~$73 million, joined our Index.

• On a revenue basis, Salesforce continues to dominate the SaaS Sector with TTM revenue of $5.1B, nearly 7x greater than the next largestpublic SaaS company. That said, an impressive number of public SaaS companies, spanning an array of product categories and verticalmarkets, have reached critical revenue mass (>350 million), a feat made more difficult by a subscription revenue model that requiresdeferral of a significant portion of booked revenue.. Examples of SaaS players that have come of age include DealerTrack (automotive,$743M TTM revenue); Athenahealth (healthcare, $710M), Workday (human capital management, $703M); ServiceNow (IT automation,$609M); Ultimate Software (human capital management, $482M), and RealPage (real estate, $395M).

• Impressively, median public SaaS company growth rates have exceeded 25% for four consecutive years.

$123.7

$104.7

$155.4$169.0 $163.5

$128.7

2009 2010 2011 2012 2013 2014

TT

M T

ota

l R

ev

en

ue

26.0%

14.2%

26.9%25.5% 26.0%

28.4%

2009 2010 2011 2012 2013 2014

TT

M R

ev

en

ue

Gro

wth



TTM Revenue Growth Rate Distribution– 4Q14 Median Revenue Performance – Quarterly

30

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%

35.0%

$0

$20

$40

$60

$80

$100

$120

$140

$160

4Q13 1Q14 2Q14 3Q14 4Q14

TT

M R

ev

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Gro

wth

TT

M T

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ev

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4%

8%

20% 20%

18%

6%

22%

<= 0% > 0%<= 10%

> 10%<= 20%

> 20%<= 30%

> 30%<= 40%

> 40%<= 50%

> 50%

% o

f C

om

pa

nie

s

TTM Revenue Growth

• On a quarterly basis, Public SaaS companies reported median TTM revenue growth of 31.9% in Q1, but growth slowed during the followingtwo quarters before regaining ground and closing Q4 with a median growth rate of 28.4%. We expect the median TTM revenue growth rateof public SaaS companies will reach or exceed 35% by year end 2015, thanks to accelerating SaaS adoption among large enterprises andSMBs, but only if 2015 GDP growth approaches or exceeds 4.5% - 5% .

• Although most struggled to recapture pre-Recession growth rates of 40%+, more than one in five public SaaS companies grew TTM revenue50% or more YoY. These overachievers hailed from a wide array of product categories, including expense management, security, businessintelligence and automotive, further affirming the widespread adoption of SaaS in enterprise, SMB and vertical markets. Kudos to CastlightHealth (295.4%), FireEye (150%), Workday (72.2%) and Truecar (62.8%).

• The median TTM revenue of public SaaS companies was $133.6M in 4Q14, a YoY increase of 29% over 4Q13’s $103.6M.




• The median gross profit of public SaaS companies declined to 66.1% in 2014, almost 4% lower than a year earlier.

• Here, too, the decline in median gross profit of public SaaS companies was primarily attributable to the addition of eight newly public SaaScompanies to our SaaS index that are serving smaller numbers of customers and carrying disproportionately higher infrastructure andapplication delivery costs, as a percent of revenue, compared to their larger SaaS peers.

• Unsurprisingly, after reaching a historical peak of 9.6% in 2010, the median SaaS Index EBITDA margin has now declined for fourconsecutive years, plunging to -8.9% in 2014.

• It would be wrong to assess the financial health of public SaaS companies based upon their GAAP compliant P&L statements. In truth, manyare not only cash flow positive, but flush with cash from prepaid subscription fees. As an example, Salesforce reported -$313.5M in netincome, yet generated $1.1B of cash from operations in the year ending 10/31/2014; Workday reported -$244.5M in net income, yetgenerated $88.5M of cash from operations in the year ending 12/31/2014; ServiceNow reported -$179.4M in net income, yet generated$138.9M of cash from operation in the year ending 10/31/2014.

68.3% 68.6%

63.4%

70.9%70.0%

66.1%

2009 2010 2011 2012 2013 2014

Gro

ss P

rofi

t M

arg

in 5.5%6.7%

9.6%8.8%

8.1%

1.0%

-8.9%

2008 2009 2010 2011 2012 2013 2014

EB

ITD

A M

arg

in



TTM EBITDA Margin Distribution– 4Q14Median EBITDA Margin Performance – Quarterly

32

(8.7%)(8.1%)

(8.9%)(9.9%)

(12.8%)

4Q13 1Q14 2Q14 3Q14 4Q14

EB

ITD

A M

arg

in

59%

23%

9%5% 4%

<= 0% > 0%<= 10%

> 10%<= 20%

> 20%<= 30%

> 30%

% o

f C

om

pa

nie

s

TTM EBITDA Margin

• The median EBITDA margin of public SaaS companies declinedsteadily throughout 2014, reaching a low of -12.8% in 4Q14.

• Over half (59%) of public SaaS companies are unprofitable, androughly nine out of ten have EBITDA margins below the 17%median of their on-premise software peers.

• And for the time being, that’s just what investors want, if thesharp increase in the median SaaS EV/EBITDA market multiple(see slide 34) is any indication.



0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

4Q13 1Q14 2Q14 3Q14 4Q14

% o

f R

ev

en

ue


-25%

-15%

-5%

5%

15%

25%

35%

45%

55%

65%

4Q13 1Q14 2Q14 3Q14 4Q14

% M

arg

in



• With market adoption of hosted software solutions ramping across enterprise, SMB and vertical markets, public SaaS companies continuedto spend heavily on sales & marketing in order to drive revenue growth and capture market share.

• In 4Q14, public SaaS companies invested a median 39.7% of total revenue on sales & marketing, almost 69% more than their on-premisecounterparts.

• R&D spending as a percent of revenue remained almost flat in 2014, inching up to 20.5% in 4Q14 from 20.3% a year earlier. Public SaaScompanies in 2014 spent 26% more on R&D as a percent of revenue then their on premise peers, as they endeavored to expand theirofferings, enhance their technology and platforms, and address new markets.


THE SEG SaaS INDEX: PUBLIC MARKET MULTIPLES


• The median stock performance of public companies comprising the SEG SaaS Index improved steadily during the economic recovery, from2.6x EV/Rev in 2009 to a whopping 6.7x EV/Rev in 2013. In 2014, the median market value of public SaaS companies retreated to 5.7xEV/Revenue.

• Despite 2014’s decline in the median EV/Rev market multiple of public SaaS companies, and the relatively unchanged median market valueof public on premise software companies during the same period, the former group was valued at a 90% premium over the latter (5.7x vs.3.0x) at the close of 4Q14.

• The stunning growth over the past five years in the median EV/Revenue multiple of our SaaS Index reflects investor appetite for companieswith huge upside, 25%+ annual revenue growth, substantial recurring revenue, and an M&A feeding frenzy targeting smaller, rapidlygrowing public SaaS companies.

3.3x

2.6x

3.6x

4.5x

5.0x

6.7x

5.7x

2008 2009 2010 2011 2012 2013 2014

Me

dia

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V/

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ve

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ult

iple

36.9x

31.4x 32.2x35.2x 35.2x

42.4x

56.8x

2008 2009 2010 2011 2012 2013 2014

Me

dia

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EB

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iple



EV/Revenue Multiple Distribution– 4Q14Median EV/Revenue and EV/EBITDA Multiples – Quarterly

35

8.1x 6.6x 6.3x 6.2x 5.6x

51.1x53.9x

56.5x

66.1x61.8x

4Q13 1Q14 2Q14 3Q14 4Q14

Me

dia

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ult

iple


2% 2%

24%

9%

2%

7%9%

13%

9%

24%

<= 1.0x > 1.0x<= 2.0x

> 2.0x<= 3.0x

> 3.0x<= 4.0x

> 4.0x<= 5.0x

> 5.0x<= 6.0x

> 6.0x<= 7.0x

> 7.0x<= 8.0x

> 8.0x<= 9.0x

> 9.0x

% o

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EV/Revenue

• On a quarterly basis, the median EV/Revenue multiple of the SEG SaaS Index closed 4Q14 at 5.6x EV/Rev, almost 30% lower than a yearearlier, when investor optimism about economic growth was high. SaaS valuations retreated with the overall market in 2014, weighed downby slower than expected GDP growth in the first two quarters, declining commodity prices, ongoing economic perturbation in Europe, Japanand elsewhere, and geopolitics.

• Investors have become more sophisticated when placing their SaaS bets, often favoring the next wave of SaaS category leaders that arepositioned to displace incumbent on-premise providers across multiple product categories, just as Salesforce did Siebel in the CRM market.Almost one of every four public SaaS companies achieved a 9x or higher median EV/Revenue multiple in 4Q14, compared to 51% in 4Q13,mostly due to 2014’s softened market valuations.


Company Ticker EV (Median)

TTM

Revenue

TTM

Revenue

Growth

EV/

Revenue

TTM

EBITDA

EBITDA

Margin

EV/

EBITDA

Castlight Health CSLT $893 $36 295.4% 24.6x -$85 -235.1% -

HortonWorks HDP $948 $44 - 21.4x -$98 -220.8% -

Workday WDAY $14,415 $703 72.2% 20.5x -$160 -22.7% -

New Relic NEWR $1,386 $85 - 16.3x -$37 -44.0% -

Netsuite N $7,911 $513 33.5% 15.4x -$45 -8.7% -

Zendesk ZEN $1,630 $111 - 14.7x -$49 -44.1% -

Tableau Software DATA $5,012 $351 82.1% 14.3x $11 3.2% 449.4x

Demandware DWRE $1,793 $142 50.3% 12.6x -$16 -11.2% -

FireEye FEYE $4,197 $340 150.0% 12.3x -$338 -99.3% -

HubSpot HUBS $1,149 $104 - 11.0x -$35 -33.4% -

Paylocity Holding PCTY $1,219 $117 40.1% 10.4x -$6 -5.1% -

Marketo MKTO $1,190 $136 60.5% 8.8x -$44 -32.5% -

Qualys QLYS $1,038 $126 21.7% 8.2x $17 13.2% 62.4x

Salesforce.com CRM $38,578 $5,074 34.9% 7.6x $87 1.7% 442.4x

Cornerstone OnDemand CSOD $1,769 $242 45.2% 7.3x -$38 -15.8% -

Ellie Mae ELLI $1,058 $145 13.5% 7.3x $26 18.1% 40.3x

Q2 Holdings QTWO $528 $73 36.7% 7.3x -$16 -21.5% -

TrueCar NasdaqGS: TRUE$1,388 $191 66.1% 7.3x -$40 -20.9% -

Cvent CVT $935 $134 28.4% 7.0x $8 5.8% 121.2x

Athenahealth ATHN $4,800 $711 31.7% 6.8x $59 8.3% 80.9x

2U TWOU $639 $104 0.0% 6.1x -$28 -27.0% -

Callidus Software CALD $727 $129 19.8% 5.6x -$2 -1.4% -

OPOWER OPWR $672 $120 52.0% 5.6x -$33 -27.2% -

SciQuest SQI $291 $102 21.6% 5.5x $5 4.6% 61.8x

Fleetmatics FLTX $1,197 $218 33.5% 5.5x $50 22.9% 24.0x

Yodlee YDLE $453 $84 - 5.4x $4 5.0% 108.3x

Workiva WK $533 $106 - 5.0x -$29 -27.2% -

Benefitfocus BNFT $632 $127 31.8% 5.0x -$48 -37.5% -

J2 Global JCOM $2,634 $570 17.6% 4.6x $238 41.8% 11.1x

ChannelAdvisors ECOM $365 $82 28.4% 4.5x -$28 -34.1% -

RealPage RP $1,658 $396 7.7% 4.2x $35 8.9% 47.1x

Amber Road AMBR $258 $63 30.6% 4.1x -$22 -34.7% -

DealerTrack TRAK $3,016 $743 62.6% 4.1x $97 13.0% 31.2x

RingCentral RNG $724 $203 37.1% 3.6x -$40 -19.4% -

Zix ZIXI $174 $50 4.8% 3.5x $10 20.4% 17.1x

LivePerson LPSN $665 $199 14.5% 3.3x $10 5.1% 65.7x

2U TWOU $586 $104 39.5% 3.3x -$28 -27.0% -

inContact SAAS $490 $157 25.3% 3.1x -$7 -4.5% -

Ebix EBIX $604 $205 -1.6% 3.0x $80 39.1% 7.6x

Bazaarvoice BV $517 $180 16.9% 2.9x -$27 -15.1% -

Constant Contact CTCT $911 $319 15.1% 2.9x $37 11.6% 24.6x

Medical Transcript MTBC $37 $14 43.2% 2.6x $0 0.1% 2182.9x

IntraLinks Holdings IL $613 $251 9.5% 2.4x $8 3.1% 79.4x

Marin Software MRIN $223 $94 29.8% 2.4x -$28 -29.4% -

Halogen Software TSX:HGN $126 $54 18.9% 2.3x -$8 -14.8% -

Rally Software Development RALY $183 $83 17.6% 2.2x -$26 -31.8% -

E2open EOPN $169 $79 13.0% 2.2x -$26 -33.1% -

Jive Software JIVE $329 $170 22.5% 1.9x -$51 -29.8% -

Covisint COVS $60 $92 -6.4% 0.7x -$35 -38.3% -


Top 25%

Bottom 25%

36

• When ranked by EV/Rev market multiple, the top 25% of companies in the SEG SaaS Index had a median market valuation of 12.5x.

• These SaaS high flyers are market leaders in an array of SaaS product categories, including security (FireEye), HCM/Finance (Workday), business intelligence (Tableau), ERP (NetSuite), eCommerce (Demandware), and Marketing (Marketo).

• SaaS providers comprising the top 25% of SaaS market multiple had a median TTM revenue growth rate of 50.3%. All but one (Qualys) had negative EBITDA margins in 4Q14.

• In contrast, public SaaS companies comprising the bottom 25% of SaaS market multiples posted a median EV/Revenue of only 2.3x. Of these, the median TTM revenue growth rate was 18.2%.




37

0.0x

3.3x2.9x

5.5x6.1x

7.3x

11.9x

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> 40%<= 50%

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Me

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TTM Revenue Growth

5.9x5.4x

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> 10%<= 20%

> 20%<= 30%

> 30%

Me

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TTM EBITDA Margin

• In 2014, as in prior years, there was a very strong correlation between the median TTM revenue growth rate and median EV/Revenuemultiple of public SaaS companies. Except for those with TTM revenue growth >10% and <20%, the median market multiple of public SaaScompanies increased with every 10% increase in the TTM revenue growth rate, and soared to 11.9x for those that were able to achieve TTMrevenue growth greater than 50% in 2014.

• While investors deemed modest profitability (TTM EBITDA margins >10% - < 30%) to be acceptable, they perceived an EBITDA greaterthan 30% to have come at the expense of growth. Unprofitable public SaaS companies boasted a rather remarkable median EV/Revenuemultiple of 5.9x in 4Q13, compared to a market multiple of only 3.8x for public SaaS providers with EBITDA margins above 30%.


THE SEG SaaS INDEX BY PRODUCT CATEGORY:FINANCIAL PERFORMANCE

4Q14 YoY Change in Median Revenue Growth4Q14 Median TTM Revenue Growth

4Q14 YoY Change in Median EBITDA Margin4Q14 Median TTM EBITDA Margin

38

28.4%

30.6%

38.1%

31.8%

CRM &Marketing

ERP &Supply Chain

VerticallyFocused

WorkforceManagement

19.5%

(20.2%)

46.0% (25.4%)

CRM &Marketing

ERP &Supply Chain

VerticallyFocused

WorkforceManagement

(15.1%)

(8.7%)

7.9%

(14.8%)

CRM &Marketing

ERP &Supply Chain

VerticallyFocused

WorkforceManagement

(34.3%)

1.6%

(28.1%)

45.8%

CRM & Marketing

ERP & Supply Chain

Vertically Focused

Workforce Management


THE SEG SaaS INDEX BY PRODUCT CATEGORY: PUBLIC MARKET MULTIPLES

4Q14 YoY Change in Median EV/Revenue4Q14 Median EV/Revenue Multiple

39

7.0x

5.5x

6.8x

7.3x

CRM &Marketing

ERP &Supply Chain

VerticallyFocused

WorkforceManagement

91.6%

(41.8%)

(25.1%)

(47.8%)

CRM &Marketing

ERP &Supply Chain

VerticallyFocused

WorkforceManagement

• Workforce Management was, once again, the most highly valued SaaS product category, racking up a 7.3x median EV/Revenue multiple atyear end; SaaS providers focused on the CRM & Marketing category came in a close second, touting a 7.0x median EV/Revenue multiple.

• Workforce Management’s leading position can be largely attributed to a much improved labor market, where an average of more than 200Kjobs were added almost every month in 2014 and unemployment fell to 5.7% of the workforce.

• The ERP and Supply Chain category lagged far behind our other three SaaS tracking categories in median market valuation. While the ERP(Workday and Netsuite) SaaS category has continued to grow revenue and thereby garner a reasonably attractive market valuation, SupplyChain providers SPS Commerce, SciQuest and E2Open experienced more sluggish TTM revenue growth in 2014 (21.9%, 21.6% and 13%,respectively) and their median EV/Rev multiple was a drag on 2014’s overall SaaS median market valuation.


THE SEG INTERNET INDEX

PUBLIC INTERNET COMPANY FINANCIAL PERFORMANCE AND MARKET MULTIPLE TRENDS


THE SEG INTERNET INDEX

• The SEG Internet Index tracks public companies that primarily utilize the Internet to offer B2C and B2B products, services andsolutions using a wide array of pricing and delivery models.

• The SEG Internet Index is currently comprised of 104 public Internet companies*.

* See appendix for complete list of companies in the SEG Internet Index


Median Revenue Growth - AnnualMedian TTM Total Revenue ($M) - Annual

THE SEG INTERNET INDEX: FINANCIAL PERFORMANCE

• Approximately 62% of the companies comprising the SEG Internet Index offer online services and solutions primarily to consumers,(Advertising, eCommerce, Gaming, Travel), accounting for their revenue volatility that closely parallels GDP growth and contraction.

• When GDP growth plummeted 10% in 2009, median TTM revenue growth of the SEG Internet Index sank to 2.9% from 19.5% a year earlier,the steepest decline among our three software tracking indices that year. In 2011, consumer confidence improved markedly amidst signs ofan awakening economy, and median TTM revenue growth of the SEG Internet Index spiked to 26.4%. from 3.4%. After declining thefollowing two years as GDP growth faltered, median revenue growth of public Internet companies rose to 20.6% in 2014 .

• Despite the improvement in revenue growth, median TTM total revenue of companies comprising our Internet Index declined from $440.4in 2013 to $411.2 in 2014. In part, that can be attributed to the inclusion of eight newly listed Internet companies with median TTM revenueof $194M. Among these 2014 Internet IPOs were Chegg (Internet Commerce), Coupons.com (Internet Ad-Tech & Lead Gen) and GrubHub(Internet Services)

• Alibaba was the only Internet sector IPO with revenue greater than $300M ($10.2 billion) to join our tracking index in 2014.

$216.2

$278.1

$333.0

$392.8

$440.2$411.2

2009 2010 2011 2012 2013 2014

TT

M T

ota

l R

ev

en

ue

2.9% 3.4%

26.4%

23.9%

18.7%20.6%

2009 2010 2011 2012 2013 2014

TT

M R

ev

en

ue

Gro

wth



TTM Revenue Growth Rate Distribution – 4Q14Median Revenue Performance – Quarterly

43

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

$0

$50

$100

$150

$200

$250

$300

$350

$400

$450

$500

4Q13 1Q14 2Q14 3Q14 4Q14

TT

M R

ev

en

ue

Gro

wth

TT

M T

ota

l R

ev

en

ue


18%

12%

15%

22%

10%

23%

<= 0% > 0%<= 10%

> 10%<= 20%

> 20%<= 30%

> 30%<= 40%

> 40%

% o

f C

om

pa

nie

s

TTM Revenue Growth• On a quarterly basis, median TTM revenue growth of the SEGInternet Index was 21% in Q4, up more than 5% YoY.

• However, the Internet ecosystem remained one of unequals;approximately one in five public Internet providers markedlyoutperformed their peers, reporting TTM revenue growthgreater than 40% in 4Q14.

• Some of these high flyers were 2014 IPOs that scaled quickly byaggressively offering innovative products and services to ahighly receptive target market. Representative examplesinclude LendingClub (130.6%), GrubHub (108.9%) andTubeMogul (104.6%).

• 2014’s quarterly trajectory portends a modest increase inannual TTM revenue growth for most public Internetcompanies in 2015, provided the 4Q14 decline in GDP growthproves to be an aberration.




• During the Great Recession, public Internet providers focused on reducing infrastructure and content costs, resulting in a spike in mediangross margin in 2011.

• As the economy regained momentum and median revenue grew, public Internet providers remained cost conscious, developing proprietarycontent and reducing third party royalties.

• For example, Yelp, an online service connecting people with local businesses, reported a gross profit margin of 93% in 4Q14, more thandouble the 45% gross margin of Pandora, an online music streaming service that pays significant royalties to music publishers.

• Although median gross profit margins have remained relatively stable, EBITDA margins of public Internet companies have declinedmeasurably since 2011 due to the combined impact of:

• A quest for top line growth by ramping sales and marketing expenses. In 4Q14, the median Sales & Marketing spend of publicInternet companies as a percent of total revenue was 25.9%, up from 23.8% in 4Q13.

• Increased competition, causing many to also ramp R&D spending to remain competitive or retain their installed base and marketleadership. In 2014, median public Internet company R&D spending as a percent of total revenue was ~14%, compared to ~10% in2012.

• A number of 2014’s Internet IPOs eschewed profitability in favor of breathtaking growth, including LendingClub (130.6%), Twitter(118.3%), TubeMogul (104.6%), Wix (81.9%), and Rocket Fuel (81.8%).

56.9%

59.1%60.1%

60.9%

66.2%65.0% 64.7%

63.8%

2007 2008 2009 2010 2011 2012 2013 2014

Gro

ss P

rofi

t M

arg

in

14.4% 14.6%

10.2%

12.2%13.1%

10.6%

8.9%8.3%

2007 2008 2009 2010 2011 2012 2013 2014

EB

ITD

A M

arg

in



TTM EBITDA Margin Distribution – 4Q14Median EBITDA Margin Performance – Quarterly

45

9.8%

9.0%8.5% 8.5%

7.8%

4Q13 1Q14 2Q14 3Q14 4Q14

EB

ITD

A M

arg

in

• On a quarterly basis, the median EBITDA Margin of our InternetIndex declined steadily over the past four quarters, to 7.8% in4Q14 from 9.8% a year earlier, in large part due to increasedspending on sales & marketing, as noted earlier.

• The quest for growth at the expense of profitability dominatedthe SEG Internet Index in 2014: 23% of public Internetcompanies reported no profits, and 58% had an EBITDAmargin of 10% or less.

• Conversely, only 5% of public Internet companies achievedEBITDA margins above 40% (compared to about twice as manyin 2013), led by VeriSign (61.6%), Facebook (54%), Alibaba(46.5%) and Mail.ru (45.5%).

23%

35%

20%

9% 9%

5%

<= 0% > 0%<= 10%

> 10%<= 20%

> 20%<= 30%

> 30%<= 40%

> 40%

% o

f C

om

pan

ies

TTM EBITDA Margin



THE SEG INTERNET INDEX: FINANCIAL PERFORMANCE BY QUARTER

0%

5%

10%

15%

20%

25%

30%

4Q13 1Q14 2Q14 3Q14 4Q14

% o

f R

ev

en

ue


-5%

5%

15%

25%

35%

45%

55%

65%

75%

4Q13 1Q14 2Q14 3Q14 4Q14

% M

arg

in


• In 4Q14, companies comprising the SEG Internet Index spent 25.9% of total revenue on sales and marketing (S&M), 13.6% on researchdevelopment (R&D), and 11.8% on general and administrative (G&A).

• The median S&M spend as a percent of revenue compares unfavorably to the 39.7% median S&M spend of the SEG SaaS Index, whereinvestors were even more insistent upon growth vs. profitability.

• The median R&D spend of public Internet companies as a percent of total revenue (13.6%) was the lowest among our three trackingindices. Many Internet companies are able to spend less on development, relative to their on-premise and SaaS peers, by:

• Leveraging open source stacks and tool kits such as Hadoop and LAMP.

• Avoiding or minimizing development of expensive, complex and frequently changing APIs and integration tools that many on-premise, and SaaS companies selling to large enterprises must incur.

• Avoiding costly customized enhancements and product calendar adjustments mandated by large, influential enterprise customerswith special needs.

• Avoiding the expense of maintaining and supporting multiple releases.



THE SEG INTERNET INDEX: PUBLIC MARKET MULTIPLES

• The stock performance of the SEG Internet Index, unsurprisingly, closely tracked the performance of the U.S. economy over the past fiveyears. After nose diving in in 2008 and sinking further in 2009, the median EV/Revenue multiple of public Internet companies began toedge up as GDP growth turned positive, soared prematurely in 2011 due to wishful thinking the economy was sharply rebounding, thensank in 2012 when consumer confidence dwindled.

• 2013’s median EV/Revenue of 2.6x, and 2014’s slightly lower median market value of 2.5x EV/Revenue reflects guarded optimism aboutcontinued GDP growth and its positive impact on consumer spending and online advertising.

• Public Internet companies experiencing the greatest YoY increase in EV/Rev (market outperformers) include internet infrastructure vendorLimelight Networks (85% increase), Internet Commerce vendors 1-800–FLOWERS.COM (60.2% increase) and Bitauto Holdings (48.6%increase), Social tech vendor Renren (35.3% increase).

2.1x

1.4x

1.2x

1.6x

2.9x

2.1x

2.6x2.5x

2007 2008 2009 2010 2011 2012 2013 2014

Me

dia

n E

V/

RE

ve

nu

e M

ult

iple

12.6x 11.9x10.0x

11.8x

15.2x13.9x

20.8x

24.6x

2007 2008 2009 2010 2011 2012 2013 2014

Me

dia

n E

V/

EB

ITD

A M

ult

iple



Median EV/Revenue Multiple Distribution – 4Q14Median EV/Revenue and EV/EBITDA Multiples – Quarterly

48

3.6x 3.4x 2.7x 2.4x 2.4x

23.7x21.9x

23.5x22.1x

26.3x

4Q13 1Q14 2Q14 3Q14 4Q14

Me

dia

n M

ult

iple


22%

25%

13%

6% 7%5% 4% 4%

2%

14%

<= 1.0x > 1.0x<= 2.0x

> 2.0x<= 3.0x

> 3.0x<= 4.0x

> 4.0x<= 5.0x

> 5.0x<= 6.0x

> 6.0x<= 7.0x

> 7.0x<= 8.0x

> 8.0x<= 9.0x

>= 9.0x

% o

f C

om

pa

nie

s

EV/Revenue

• On a quarterly basis, the median market valuation of public Internet providers fell 33% YoY, declining to 2.4x from 3.6x, largely due to2014’s more general market correction. The decline in median market valuation was by no means unique to public Internet companies; themedian EV/Revenue of our SaaS and Software Indices also declined during the same period, dropping 31% and 12% YoY, respectively.

• More than any other of our tracking indices, the widely disparate financial performance of the 104 companies comprising the SEG InternetIndex reveals an Internet ecosystem heavily bifurcated into “haves” and “have nots.” Viral adoption, consumer fickleness, switching ease,unlimited choice and fierce competition handsomely reward a select few and punish many others.

• 4Q14 served to further exemplify this bifurcation: 47% of companies ended the quarter with an EV/Revenue multiple of 2.0x or less, while24% closed the quarter with a market multiple of 6.0x EV/Revenue or higher.

• Among the Internet companies boasting the highest EV/Revenue market multiples by year end 2014 were many relatively recent publicmarket entrants. While some of these star performers had created and were dominating new Internet categories (e.g., Facebook & LinkedIn),others had revolutionized and reshaped older categories and vertical markets (e.g., Alibaba& Zillow).




49

1.0x 1.2x2.0x 2.2x

4.3x

9.4x

<= 0% > 0%<= 10%

> 10%<= 20%

> 20%<= 30%

> 30%<= 40%

> 40%

Me

dia

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V/

Re

ve

nu

e

TTM Revenue Growth

1.5x 1.7x 1.8x

7.1x 6.9x 6.8x

<= 0% > 0%<= 10%

> 10%<= 20%

> 20%<= 30%

> 30%<= 40%

> 40%

Me

dia

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V/

Re

ve

nu

e

TTM EBITDA Margin

• Expectedly, Public Internet companies with TTM revenue growth of 40% or higher were rewarded with median EV/Revenue multiplesmarkedly greater than their slower growing peers. Among those growing 40%+ were: LendingClub (130.6%), Qihoo (113.8%), GrubHub(108.9%), 58.com (83.8%), and Yelp (66.2%).

• Unlike The SEG SaaS Index, where TTM EBITDA margins are inversely related to median EV/Revenue multiples, investors in public Internetcompanies kept a keen eye on margins, and rewarded more profitable performers with significantly higher market multiples.

• As testament, public Internet companies with EBITDA margins above 40% posted a median EV/Revenue multiple of 6.8x in 4Q14, 183%higher than the overall Index median. By comparison, public SaaS companies with EBITDA margins above 30% (not enough companies with40%+) posted a median EV/Revenue multiple of 3.8x, 32% below the SaaS median market valuation.

• Simply put, the fall from grace of too many one-time high flyers, and the unfulfilled promise of others, have caused investors to be shortsighted and highly circumspect about Internet providers that aren’t currently achieving both growth and profitability. That’s their hedgeagainst a mostly transaction-based revenue model that can be unpredictable, and difficult to sustain. Conversely, investors in rapidlygrowing public SaaS companies, enamored with the reliability and sustainability of subscription based recurring revenue, are highly criticalof SaaS providers that are not investing in their future by aggressively growing their base without regard to profitability.


Ad Tech Commerce Content & Media Gaming

Infrastructure Services Social Travel

• The SEG Internet Index is segmented into nine product categories.

• Representative companies in each Internet category are referenced below.

• Please see the appendix for a complete list of companies within each product category.

THE SEG INTERNET INDEX: FINANCIAL AND MARKET PERFORMANCE BY PRODUCT CATEGORY

50

Search


Ad Tech 3.0x 2.7x 2.0x 2.1x 1.9x 24.7x 23.2x 26.5x 17.2x 29.3x 16.1% 30.3% 27.2% 25.1% 27.7% 4.3% 4.6% 5.4% 5.8% 3.7%

Commerce 1.7x 1.1x 1.3x 1.5x 1.5x 15.4x 16.7x 20.2x 28.8x 30.3x 15.2% 16.3% 16.1% 14.1% 13.5% 5.7% 9.6% 8.4% 7.7% 7.7%

Content & Media 4.7x 3.8x 2.8x 2.2x 2.1x 30.2x 24.3x 23.2x 19.0x 28.0x 16.0% 8.8% 11.4% 12.9% 12.4% 14.5% 13.2% 11.7% 11.0% 10.6%

Gaming 2.9x 3.4x 2.8x 2.5x 2.5x 9.1x 8.5x 10.2x 11.4x 21.5x 18.7% 12.1% 12.2% 14.1% 19.2% 34.7% 27.1% 29.8% 21.0% 18.3%

Infrastructure 1.8x 1.8x 1.4x 1.5x 1.4x 17.9x 17.8x 17.7x 17.3x 16.4x 4.3% 10.5% 9.9% 8.4% 7.2% 5.7% 6.5% 6.0% 4.9% 4.7%

Search 8.4x 6.7x 6.7x 5.5x 5.7x 21.5x 18.7x 19.4x 16.3x 16.7x 27.2% 28.3% 28.0% 28.7% 29.1% 38.4% 35.4% 34.4% 33.8% 32.8%

Services 4.5x 3.4x 2.8x 2.6x 2.5x 40.6x 32.9x 25.1x 28.3x 28.8x 38.2% 51.2% 31.3% 38.3% 30.4% 6.0% 7.1% 7.3% 6.6% 7.1%

Social 16.1x 11.5x 13.8x 13.0x 11.4x 52.8x 37.6x 38.8x 36.4x 32.6x 56.9% 57.2% 62.4% 63.7% 63.0% 12.1% 10.9% 9.9% 10.6% 11.2%

Travel 3.6x 4.0x 4.4x 4.0x 3.8x 19.5x 18.5x 19.1x 16.9x 15.5x 19.6% 18.4% 17.3% 19.5% 21.0% 17.0% 17.1% 15.0% 14.9% 14.3%

Median 3.6x 3.4x 2.7x 2.4x 2.4x 23.7x 21.9x 23.5x 22.1x 26.3x 16.5% 19.5% 18.9% 19.9% 21.0% 9.8% 9.0% 8.5% 8.5% 7.8%

EBITDA Margin

SEG Internet Index

CategoryEV/Revenue EV/EBITDA TTM Revenue Growth


THE SEG INTERNET INDEX BY PRODUCT CATEGORY:FINANCIAL AND MARKET PERFORMANCE BY PRODUCT CATEGORY

4Q14 Median YoY Change in Revenue Growth4Q14 Median TTM Revenue Growth

4Q14 Median YoY Change in EBITDA Margin4Q14 Median TTM EBITDA Margin

51

27.7%

13.5%

12.4%

19.2%

7.2%

29.1%

30.4%

63.0%

21.0%

Ad Tech

Commerce

Content & Media

Gaming

Infrastructure

Search

Services

Social

Travel

71.6%

(11.5%)

(22.3%)

2.4%

69.2%

7.1%

(20.3%)

(20.3%)

10.7%

Ad Tech

Commerce

Content & Media

Gaming

Infrastructure

Search

Services

Social

Travel

3.7%

7.7%

10.6%

18.3%

4.7%

32.8%

7.1%

11.2%

14.3%

Ad Tech

Commerce

Content & Media

Gaming

Infrastructure

Search

Services

Social

Travel

(15.5%)

35.5% (27.0%)

(47.4%)

(17.6%)

(14.6%)

18.0%

18.0%

(7.7%)

Ad Tech

Commerce

Content & Media

Gaming

Infrastructure

Search

Services

Social

Travel


THE SEG INTERNET INDEX BY PRODUCT CATEGORY:FINANCIAL AND MARKET PERFORMANCE BY PRODUCT CATEGORY

Median 4Q14 YoY Change in EV/Revenue4Q14 Median EV/Revenue Multiples

52

1.9x

1.5x

2.1x

2.5x

1.4x

5.7x

2.5x

11.4x

3.8x

Ad Tech

Commerce

Content & Media

Gaming

Infrastructure

Search

Services

Social

Travel

(35.0%)

(11.7%)

(53.8%)

(11.9%)

(23.9%)

(31.8%)

(44.6%)

(44.6%)

(29.4%)

Ad Tech

Commerce

Content & Media

Gaming

Infrastructure

Search

Services

Social

Travel

• Public Internet Companies comprising the Social product category closed 4Q14 with a median revenue growth rate (63%) more than twicethe overall category median .

• The success Social media Internet providers have had monetizing their services, largely through advertising, has come at the expense ofSearch companies that have seen revenue growth slow to a median 17% for all 2014, down from a median growth rate of 30.6% in 2013,with marketers clearly enamored with the reach and ROI of Facebook and LinkedIn.

• The Social category also closed the fourth quarter with the highest median EV/Revenue market multiple, 11.4x. Though impressive, Q4’smarket multiple for Social represented a 44.6% YoY decline from 2013, when the category’s median market multiple had increased 85%YoY.

• As a result of these shifting advertising budgets and priorities, the median TTM revenue growth of the Ad Tech & Lead Generation productcategory plunged 45.8% YoY in 4Q13 and another 35% YoY in 4Q14.

• The Infrastructure product category lagged all other Internet product categories, with a 1.4x EV/Revenue multiple, a tepid TTM revenuegrowth of 7.2%, and a lackluster 4.7% EBITDA margin.


SOFTWARE/SaaS/INTERNET IPO


• 2014 was a record setting year for Software/SaaS/Internet IPOs, with 32 companies making their public market debut, easily surpassing theprevious high of 26 IPOs set in 2007, 2012 and 2013.

• These 32 IPOs raised an aggregate $12.2B, manifestly higher than 2013’s $4.7B total, and roughly 30% greater than the prior ten year highof $9.4 billion in 2012, when Facebook’s massive IPO boosted new listing proceeds well beyond prior years. In 2014, it was Alibaba’smassive $8.3 billion IPO that helped push total net proceeds for the sector to a new high.

• SaaS companies accounted for nearly 50% of 2014’s software sector total IPO count, compared to 40% of total in 2013. In aggregate 2014’ssixteen SaaS IPOs raised approximately $1.4 billion.

ANNUAL SOFTWARE IPO TRENDS

SaaS IPOsSoftware/SaaS/Internet IPOs

10

13

26

2

6

18

22

26 26

32

$0

$2,000

$4,000

$6,000

$8,000

$10,000

$12,000

$14,000

0

5

10

15

20

25

30

35

20

05

20

06

20

07

20

08

20

09

20

10

20

11

20

12

20

13

20

14

To

tal

Ne

t P

roce

ed

s (M

illi

on

s)

Nu

mb

er

of

So

ftw

are

/S

aa

S/

Inte

rne

t

IPO

s

Total Number of IPOs Total Net Proceeds

54

6

3

7

10

16

$0.0

$200.0

$400.0

$600.0

$800.0

$1,000.0

$1,200.0

$1,400.0

$1,600.0

0

2

4

6

8

10

12

14

16

18

20

10

20

11

20

12

20

13

20

14

To

tal

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s (M

illi

on

s)

Nu

mb

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of

Sa

aS

IP

Os

Number of SaaS IPOs Total Net Proceeds


*Financial data is the latest available from Capital IQ.**First day return compares listed offering price to first day close.

2014 SOFTWARE IPO DATA• The breakdown of 2014’s IPOs: Seven on-premise software

companies, sixteen SaaS, and nine Internet.

• Four of the seven on-premise software companies provide MobileSolutions Performance Management software. Three of theseIPO’s saw positive first day returns, but only two were able tosustain positive returns through the end of the year - Dream Sky(+13.9%) and MobileIron (10.7%). Conversely, King Digital andMomo were down 31.7% and 11.1%, respectively, by year end.

• In a year that featured an unusual number of highly touted IPOs,including Alibaba, LendingClub, TrueCar, Hubspot and Zendesk,the 2014 IPO with the highest stock return by year end wasTubeMogul whose 2014 stock price closed up 222.1%.TubeMogul provides a platform that enables advertisers to plan,buy, measure, and optimize their video advertising spending froma single platform.

• The median year end stock return for 2014’s sixteen SaaS IPOswas 39.7%, notably lower than 2013’s median year end return of108.7% for ten SaaS IPO’s, but still quite respectable consideringthe median EV/Revenue multiple for all public SaaS companiesdeclined from 5.7 x from 6.7x YoY.

• Given the strengthening labor markets and decliningunemployment rates, its no surprise the two workforcemanagement IPOs during 2014, Paycom and Paylocity, postedyear end returns of 75.5% and 53.6%, respectively, well above themedian (39.7%).

• Alibaba was 2014’s most anticipated IPO. The China basedeCommerce giant debuted with more than a 20 x EV/Rev marketvaluation, and raised a stunning $8.3 billion. Investors were wellrewarded by the company’s first day and year end gains, 38.1%and 52.9%, respectively.

55

Company (Ticker) Category IPO Date Net Proceeds Enterprise Value EV / RevEV /

EBITDAFirst Day Return

YTD

Return

A10 Networks Networking & Network

Performance Management 3/21/14 $125,550,000 $1,082,242,090 7.6x n/a 8.1% (70.9%)

Cyberark Software Security9/24/14 $477,700,000 $809,759,400 10.7x n/a 87.1% 147.8%

iDream Sky Technologies Mobile Solutions / Content8/7/14 $107,415,000 $649,243,800 1.6x n/a 6.3% 13.9%

King Digital Entertainment Mobile Solutions / Content3/26/14 $329,403,760 $5,611,316,570 3.0x 7.8x (15.6%) (31.7%)

MobileIron Mobile Solutions / Content6/12/14 $93,000,000 $761,487,980 7.1x n/a 22.4% 10.7%

Momo Mobile Solutions / Content12/11/14 $25,200,000 $3,011,650,500 105.6x -125.1x 26.1% (11.1%)

Varonis Systems Business Intelligence,

Storage, Data 2/28/14 $98,208,000 $1,081,300,000 14.5x n/a 100.0% 49.2%

$107,415,000 $1,081,300,000 7.6x -58.7x 22.4% 10.7%

2U Vertically Focused3/28/14 $96,720,000 $540,025,400 6.5x n/a 7.5% 51.2%

Amber Road ERP & Supply Chain3/21/14 $57,824,900 $421,581,630 8.0x n/a 30.8% (21.4%)

Castlight Health Vertically Focused3/14/14 $165,168,000 $3,378,303,340 260.4x n/a 148.8% (26.9%)

Hortonworks Business Intelligence12/12/14 $93,000,000 $986,242,460 22.3x n/a 64.9% 68.8%

Hubspot CRM & Marketing10/9/14 $116,250,000 $911,818,200 8.8x n/a 20.4% 34.4%

Medical Transcript Vertically Focused7/23/14 $18,972,000 $19,232,560 1.7x 26.7x (14.4%) (53.2%)

New Relic Business Intelligence12/12/14 $106,950,000 $1,472,733,540 17.3x n/a 47.8% 51.5%

OPOWER Vertically Focused4/4/14 $107,787,000 $1,064,116,000 10.8x n/a 21.1% (25.1%)

Paycom Software Workforce Management4/15/14 $64,266,000 $766,584,850 6.6x 52.4x 2.3% 75.5%

Paylocity Workforce Management3/19/14 $79,050,000 $1,174,505,880 13.0x 602.0x 41.4% 53.6%

Q2 Holdings Vertically Focused5/19/14 $75,562,500 $330,690,860 5.4x n/a (7.5%) 44.9%

TrueCar Other SaaS5/16/14 $65,076,750 $676,960,280 4.4x n/a 11.8% 154.4%

Upland Software Other SaaS11/6/14 $42,923,080 $215,617,000 3.6x n/a (18.8%) (20.3%)

Workiva Other SaaS12/12/14 $93,744,000 $533,196,320 5.0x n/a (1.8%) (4.3%)

Yodlee Other SaaS10/3/14 $69,750,000 $386,127,800 4.6x 92.2x 12.0% 1.7%

Zendesk CRM & Marketing5/15/14 $93,000,000 $980,463,550 11.8x n/a 49.2% 170.8%

$86,025,000 $721,772,565 7.3x 72.3x 16.2% 39.7%

Alibaba Commerce 9/19/14 $8,268,800,530 $232,579,395,680 22.9x 49.2x 38.1% 52.9%

Coupons.com Ad tech & Lead

Generation3/7/14 $156,240,000 $2,179,408,000 13.0x n/a 87.5% 10.9%

Everyday Health Services3/28/14 $93,090,000 $455,744,000 2.9x 43.2x (3.6%) 5.4%

GrubHub Services4/4/14 $96,720,000 $2,442,584,000 14.4x 62.4x 30.8% 39.7%

LendingClub Services12/11/14 $711,116,250 - - - 56.2% 68.7%

MOL Global Commerce10/10/14 $87,949,100 $502,183,090 2.6x 11.7x (34.3%) (75.6%)

The Rubicon Project Ad tech & Lead

Generation4/2/14 $75,564,300 $270,412,600 3.0x n/a 33.9% 7.6%

TubeMogul Ad tech & Lead

Generation7/18/14 $40,687,500 $324,409,000 3.8x n/a 64.3% 222.1%

Xunlei Content & Media6/24/14 $81,640,000 $653,799,870 3.7x 15.4x 24.2% (39.2%)

$93,090,000 $577,991,480 3.8x 43.2x 33.9% 10.9%

$93,045,000 $766,584,850 7.1x 43.2x 23.3% 12.4%

Software Category Median:

SaaS Category Median:

Internet Category Median:

SaaS Category

Internet Category

Software Category

Total Median:


U.S. VENTURE CAPITAL ACTIVITY: ALL INDUSTRY SECTORS

• According to PricewaterhouseCoopers, venture capitalists invested in 4,356 companies in 2014, a four percent YoY increase. In aggregate,$48.4 billion was shelled out, a whopping 61% increase YoY increase.

• Early stage companies represented 50% of the total number of VC recipients in 2014, snagging $15.8 billion (up 54% YoY).

• Expansion stage companies attracted the most investor cash, $ 19.8 billion (up 102% YoY) spread across 1,156 investments (up 13% YoY).

• Seed stage investments activity and dollars invested both declined in 2014. Seed stage investors deployed $718.7 million (down 29% YoY)across 192 investments (down 18% YoY). Early stage VCs seem to have relinquished this high risk/high reward ground to crowd fundingsites and angel sources which have proved to be more accessible and more risk-oriented than many VCs.

Overall VC Activity by Investment StageOverall VC Activity

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Seed Early Stage Expansion Later Stage

56


U.S. VENTURE CAPITAL ACTIVITY: SOFTWARE

• The number of software companies receiving VC investmentsballooned from 1,523 in 2013 to 1,799 in 2014. Sincebottoming out in 2009, the number of software focusedrecipients has expanded at a compounded annual growth rate(CAGR) of 17%.

• VC dollars invested in software totaled $19.8 billion in 2014, a77% YoY increase. Since 2009, the aggregate capital investedin software has advanced at a 38% CAGR.

• Software now accounts for 41% of total VC dollars investedacross all industry sectors, compared to 19% in 2009.

“Software is eating the world.”

Marc Andreessen

“The next wave of the Web is going to be user-generated content.”

John Doerr

Software VC Dollars as a Percent of TotalSoftware VC Activity

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Total VC Investment Dollars

Number of VC Investments

15%

21%23%22%

20%

24%27%

25%25%24%23%

20%20%20%19%22%

26%

31%

37%41%

“Software is redefining how peopledo things ... We're nowhere near what we can do.”

Bill Gates

57


THE BUYERS SPEAK

SOFTWARE EQUITY GROUP’S 2015 M&A SURVEY


THE BUYERS SPEAK: SOFTWARE EQUITY GROUP’S 2015 M&A SURVEY

Buyer Thinking 2015

In early January 2015, Software Equity Group conducted its eighth annual Survey of Software Company Buyers to provide our readers abetter understanding of 2015’s software M&A ecosystem and buyer thinking. We polled more than 300 of the largest software companies inthe world, both public and private. Collectively, the buyers who responded to our survey spent in excess of $8.6 billion on acquisitions in2014. The vast majority (76%) of respondents were public software, SaaS and Internet companies with an aggregate enterprise value of$239.3 billion. Undoubtedly, their plans and playbook will heavily influence the software M&A ecosystem in the year ahead.

Number of Planned Acquisitions

In 2014, 67% of our respondents acquired at least one software company, reflecting continued concerns by at least a third of eligible buyersabout the near term economic outlook. That reticence now seem to have dissipated. In 2015, 95% of our respondents expect to acquire atleast one software company. Those that were very acquisitive in 2014 have signaled a slowdown, as they seek to digest 2014’s acquisitions.Only 5% plan on acquiring six or more companies in 2015, down from 18% in 2014, and 14% in 2013.

Size of Target

With virtually all buyers now in the hunt, our Survey results portend well for small, privately held software companies considering an exit in2015. The overwhelming majority of respondents (95%) indicated they’ll be focused in 2015 on transactions with enterprise values between$10M - $99M. However, 2015 should also see a greater number of larger and mega-deals. 33% of respondents indicated they anticipatefocusing on transactions of $100 million or more.

2015 Exit Valuations

Respondents to our Survey overwhelmingly agreed that exit valuations have topped out for the time being. Some 70% expect to value targetsthe same as in 2014. One in four respondents, however, indicated they intended to pay less in 2015 than they did in 2014 for a substantiallysimilar target. In 2014, the median SaaS exit multiple declined 10% YoY, from 4.1x TTM revenue to 3.7x; we expect a similar decline in 2015,as SaaS exit valuations continue to normalize.

There’s a clear message here for owners and investors of software/SaaS and Internet companies that might contemplate exit in 2015. Buyershave become more disciplined. Even when bidding on a deal they deem highly strategic, most will stick fast to a valuation they believe reflectsthe standalone, pre-acquisition, fair market value of the target.


Buyer Acquisition Motives in 2015

What’s driving these buyers to acquire? Clearly, buyers are focused on enhancing, broadening and/or deepening their currentoffering, with 55% of respondents to our Survey citing synergistic technologies and products as their primary acquisitionobjective. More than one in three (35%), however, will be seeking targets that can enable them to expand and diversify into newproduct categories, verticals and territories. Only one in ten respondents indicated their primary M&A objective in 2015 is toconsolidate their market and acquire customers for cross sell opportunities.

Not one respondent to our 2015 Survey cited the target’s profitability as a primary acquisition motive, with 60% deeming it leastimportant when selecting and valuing a candidate. That’s consistent with the data published elsewhere in this Report whichshowed the most profitable public SaaS companies were punished with the lowest EV/Rev market valuations.

Passing Muster: What Buyers Consider Most Important About A Target in 2015

Given the predilection of most buyers for technology and products that will enhance, broaden and/or deepen their own, it’s nosurprise that will be the primary focus of most when evaluating a candidate. More than half our respondents stated great,synergistic products and technologies as the most important target evaluation criteria, with 80% ranking it first or second inimportance.

The target’s growth trajectory was the criteria ranked most important by more than one in three (35%) of our respondingbuyers, with 70% naming it among their top two acquisition criteria. For buyers, a target’s growth confirms not only the marketopportunity as reflected by real time market adoption, but the viability and competitiveness of the target’s specific offering inthat market.

Respondents to our 2015 Buyers Survey deemed profitability to be mostly irrelevant when evaluating a target, while placing onlyslightly more importance on the target’s management team and domain expertise. This year, a scant 5% of respondents citedmanagement as the primary reason for acquisition, down from 18% in 2014. That could portend fewer earnouts and lockups in2015, with buyers less concerned about post-closing transition and knowledge transfer.

60




What Buyers Don’t Want in 2015

Seller candidates that have not invested sufficiently in keeping their products and technology state of the art are destined forrejection in 2015. Fully half of our respondents indicated little or no interest in acquiring a target whose technology was matureand in need of a significant upgrade. Even when sell-side candidates assert their target markets are copasetic with theirtechnology as currently deployed, buyers in 2015 will have little interest in assuming the risk of rewrites, redeployments andtechnology upgrades.

Three out of four respondents ranked revenue fluctuation, slow down or decline as their top one or two concerns whenevaluating a prospective acquisition. With growth being one of their top two acquisition objectives, any sign the target’s advanceis slowing or declining is almost always viewed as cause for alarm. Attempts by the target to attribute the slowdown to arevamped sales force, new product launch delays and/or implementation snags will likely fall on deaf ears. Seller beware!

The Importance of SaaS

And just what did buyer’s say about the importance of SaaS this year? In 2014, a whopping 56% of respondents indicated it was“very important” or “absolutely essential” a target be all or substantially SaaS deployed and subscription based, as compared toonly 13% five years ago. It does seem that some of the buyer impetus for acquiring a SaaS candidate may have ameliorated. WithSaaS acquisitions ramping sharply over the past five years, many big buyers have already acquired the hosted technology,infrastructure and vertical domain expertise they lacked earlier, making a highly strategic, on-premise target’s prospectivetransition to SaaS less daunting.

The Importance of Mobile

Given the market buzz surrounding Mobile, we asked buyers how important it was for a 2015 target to have a solid mobileoffering. A third of our respondents deemed it “unimportant”, while less than half considered it to be “somewhat important”. Wefound somewhat telling that only 21% of our respondents deemed a mobile offering to be “very important” when evaluating acandidate, compared to 33% of respondents to our 2013 Buyers Survey.


0 33%

1-2 38%

3-5 24%

6-10 0%

More than 10 5%

0 5%

1-2 57%

3-5 33%

6-10 0%

More than 10 5%

In 2015, what size transactions do you anticipate focusing on? (Choose all that apply)

Under $10M 33%

$10M - $99M 95%

$100M - $499M 29%

Greater than $500M 5%

The same 70%

Less 25%

10% to 20% more 5%

21% to 30% more 0%

31% to 40% more 0%

Greater than 40% more 0%

What's your current view of valuations? How much would you expect to pay in 2015

for a company very similar to the one you acquired in 2014?Response %

Software Equity Group's 2015 Software M&A Outlook Survey

Approximately how many software companies did you acquire in 2014? Response %

In 2015, how many software companies do you anticipate acquiring? Response %

Response %

SOFTWARE EQUITY GROUP’S 2015 M&A OUTLOOK SURVEY


SOFTWARE EQUITY GROUP’S 2015 M&A OUTLOOK SURVEYApproximately, what percentage of acquisition targets in 2014 were venture capital

or private equity-backed (versus 'bootstrapped' or self-funded)? (Please select

percentage that were equity-backed)

0-10% 14%

10-20% 24%

20-50% 29%

50-75% 10%

75-100% 5%

1 2 3 4 5

Consolidating your current market: customer acquisition and market share 10% 25% 30% 20% 15%

Enhancing/deepening your offering incrementally w ith synergistic technologies and products 55% 15% 5% 25% 0%

Expanding/diversifying into new product categories, technologies, verticals, and/or territories 35% 30% 10% 15% 10%

Improving your near term financial performance metrics 0% 20% 5% 15% 60%

Competitive differentiation 0% 10% 50% 20% 20%

1 2 3 4 5

Products and technology: The target’s products/technology are w ell executed, a great f it w ith us,

and provide the strategic leverage/competitive differentiation w e seek55% 25% 15% 0% 5%

Grow th: The target is grow ing at a rate far greater than average, demonstrating strong market

demand, and w e w ant to catch that w ave35% 35% 20% 10% 0%

Profitability: The target is highly profitable, the deal w ill be accretive, the f inancial risk is low er 0% 5% 20% 15% 60%

Customer Focus: We can really capitalize upon the target's geography/market niche/customer base 5% 10% 20% 40% 25%

Management and Operations: The target has deep domain expertise w e need to acquire, a great

team, proven performers5% 25% 25% 35% 10%

1 2 3 4 5

Revenue concentration 10% 10% 20% 35% 25%

Revenue fluctuation, slow dow n or decline 35% 40% 20% 5% 0%

Mature technology requiring signif icant update 50% 25% 25% 0% 0%

Solution w ritten in an incompatible language (Java vs. C#) or not easily interfaced/integrated w ith

your offering5% 15% 35% 35% 10%

Little or no EBITDA 0% 10% 0% 25% 65%

What concerns your company most when evaluating a potential acquisition target?

(Rank 1-5 in order of importance, 1=most important, 5=least important)

When selecting and valuing a particular acquisition target in 2015, what's most/least

important? (Rank 1-5 in order of importance; 1=most important, 5=least important)

Ranking

Ranking

What are your primary acquisition motives in 2015? (Rank 1-5 in order of priority,

1=most important, 5=least important)

Ranking

Response %


SOFTWARE EQUITY GROUP’S 2015 M&A OUTLOOK SURVEY

Unimportant 32%

Somew hat 47%

Very 21%

Absolutely essential 0%

Board 0%

CEO 38%

Executive Management Collaboratively 67%

Business Unit Head 48%

Competition 0%

Unimportant 6%

Somew hat 39%

Very 50%

Absolutely essential 6%

* In some instances, the percentages listed in the responses for a particular question exceed 100% in aggregate due to rounding.

How important is it for you in 2015 that the target have a well executed mobile offering as

part of its overall product offering?Response %

Who is setting acquisition strategy? (Choose all that apply) Response %

How important is it for you in 2015 that the target be all or substantially SaaS/subscription

based?Response %


SOFTWARE INDUSTRY M&A MARKET UPDATE


U.S. Software Mergers & Acquisitions Activity - Quarterly

• After averaging about 1,700 software transactions annually for each of the past four years, software M&A deal volume soared to 1,914transactions in 2014, a 15% YoY increase.

• Software M&A spending also rose dramatically in 2014, buoyed by a plethora of megadeals and higher deal volume. 2014’s aggregate M&Aprice tag of $114.8 billion was almost 60% greater than the $67.0 billion spent on industry acquisitions in in each 2012 and 2013.

• To add some perspective, the closest we’ve come in the past decade to this year’s M&A deal volume and spend was in pre-recession 2007,when roughly $82 billion was spent on 1,894 transactions. Additionally, 2Q14 was the only the third time since 2003 to eclipse the500/quarter mark – beating 2Q07 (502) and virtually matching 1Q08 (518).

• With healthy balance sheets and growing confidence in the economy, strategic and financial buyers in 2014 dug deeper and raised theirsights, shelling out roughly $77 billion among 46 mega-deals t (EV> $500M).

• 2014’s largest M&A transactions included Facebook’s acquisition of WhatsApp ($16.4 billion); SAP’s acquisition of Concur ($7.7 billion,11.5x EV/Rev); Oracle’s acquisition of Micros Systems ($4.6 billion, 3.4x EV/Rev); and Zillow’s acquisition of Trulia ($3.1 billion, 14.8xEV/Rev).

U.S. Software Mergers & Acquisitions Activity - Annual

456432

454435

406394

431444 455 460

517

462475

$12.6

$15.8

$23.1

$12.3

$15.8

$9.9

$20.8

$20.2

$22.8

$31.4

$26.7

$39.4

$17.3

$0

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4Q11 1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14 4Q14

Valu

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Nu

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1,6421,766 1,727 1,672

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$52.5$70.4

$67.0$67.0

$114.8

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66

SOFTWARE/SaaS M&A DEAL VOLUME AND SPENDING


Median EV/Revenue Exit Multiple DistributionAverage On-Premise Software M&A Deal Value

• Q4’s $60M average software M&A price tag, though modestlylower than the prior quarter, was significantly greater than thehistorical average. In part that was due to the increasednumber and size of the fourth quarter’s megadeals.

• The $60M average transaction size affirms the results of our2014 Annual Buyer Survey, in which 95% of respondentsindicated they’d focus in the year ahead on deals in that pricerange.

SOFTWARE M&A EXIT MULTIPLES

• In 2014, slightly more than 40% of all on-premise softwaretargets were acquired for 2.0x TTM revenue or less, and almost70% sold for 3.0x revenue or less.

• A significant percentage of targets receiving a 3.0x or higherexit multiple were both sizable and vertically focused,enhancing buyers’ growth rates and vertical marketpenetration.

• Among 2014’s more noteworthy on-premise vertical softwareacquisitions: Cognizant Technology’s acquisition of TrizettoGroup ($2.7 billion, 3.8x EV/Rev); Oracle’s acquisition ofMicros Systems ($4.6 billion, 3.4x EV/Rev); Dassault Systemes’acquisition of Accelrys ($683M, 4.1x EV/Rev); andNemetschek’s acquisition of Bluebeam Software ($100M, 4.6xEV/Rev).

$41 $41 $42

$36$39

$36 $35$40

$43

$53 $54

$63$60

$0.0

$10.0

$20.0

$30.0

$40.0

$50.0

$60.0

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4Q

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12

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15.4%

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10.6% 9.6%

2.9%

7.7%

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%

35.0%

<= 1.0x > 1.0x &<= 2.0x

> 2.0x &<= 3.0x

> 3.0x &<= 4.0x

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> 5.0x &<= 6.0x

> 6.0x

TTM Revenue Exit Multiple Bins

% o

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67


Median Exit Multiples - Quarterly

• The median software industry exit multiple in 2014 was 2.3xTTM revenue. The multiple has remained virtually unchangedover the past six quarters since leaping to 2.3x in 3Q13 from1.8x in 2Q13.

• 2014’s annualized median exit multiple is the highest on recordsince we began publication in 2002. Historically, the mediansoftware industry M&A multiple has hovered at 2x revenue.

• On an EBITDA basis, the median exit multiple in 4Q14 was16.2x TTM EBITDA. The multiple has declined the past twoquarters from 2Q14’s post-recession high of 18.1x, withstrategic buyers more concerned about accelerated growththan profitability.

SOFTWARE M&A EXIT MULTIPLES

Median EV/Revenue Exit Multiple - Annual

2.3x 2.3x 2.3x 2.4x 2.3x

12.9x 13.3x

18.1x 17.7x

16.2x

0.0x

2.0x

4.0x

6.0x

8.0x

10.0x

12.0x

14.0x

16.0x

18.0x

20.0x

4Q13 1Q14 2Q14 3Q14 4Q14


1.4x

1.7x

2.0x 2.0x 2.1x1.9x

1.8x2.0x

2.1x2.0x

2.2x2.3x

0.0x

1.0x

2.0x

3.0x

2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

68


By SizeBy Ownership Structure

SOFTWARE M&A: BY OWNERSHIP STRUCTURE AND SIZE

• Historically, public buyers have paid more for acquisitiontargets than private buyers. In 2014, however, both public andprivate buyers paid a median 2.3x TTM revenue for theiracquisitions.

• In large part, that’s because a plethora of private equity firms,seeking to bulk up portfolio platform investments in order totake advantage of a sizzling IPO market, were willing to conferstrategic valuations on targets deemed highly opportune andreadily digestible.

• Based on our analysis, private equity firms paid a median 3.0xTTM revenue for their targets in 2014. Select private equitytransactions included Vista Equity Partners 4Q14 acquisition ofAdvanced Computer Software Group ($1.1 billion, 3.3xEV/Rev) , and Apax Partners’ 4Q14 acquisition of ExactHoldings ($817 million, 3.1x EV/Rev).

• Among public buyers, those with deep pockets (revenuegreater than $200 million) paid a median 2.8x TTM revenue fortheir targets in 2014, compared to only 1.9x paid by smallerpublic buyers.

• Larger buyers, whether public or private, buyers, paid a highermultiple in 2014 for targets <$20 million revenue than fortargets >$20 million. Many of these smaller targets required amodest premium in order to give up the dream, after finallygaining market traction and accelerated growth in 2014.

Buyer Less Than $200 million1.9x Median Multiple

Buyer Greater Than $200 million2.8x Median Multiple

Seller Less Than $20 million: 2.4x


Seller Greater Than $20 million: 1.5x



Seller Less Than $20

million



Public Sellers 2.2x Median Multiple

Private Sellers2.4x Median Multiple

Public Buyers2.3x Median Multiple

Private Buyers2.3x Median Multiple

71%29%

77%

23%

54%46%

69


Horizontal & Vertical M&A Median EV/Revenue Exit MultiplesHorizontal & Vertical M&A Volume

SOFTWARE M&A: BY VERTICAL AND HORIZONTAL MARKETS

• Horizontal software providers garnered the lion’s share of M&A transactions in 2014, as they have for the past five years, accounting for67% of all software M&A transactions.

• The median exit multiple for horizontal software companies in 2014 was 2.3x TTM revenue , virtually unchanged since 2010.

• Noteworthy horizontal deals in 2014 included SAP’s acquisition of supply chain planning and optimization provider, Quintiq, for $337million (3.3x revenue); Thoma Bravo’s acquisition of infrastructure software provider, Compuware, for $2.4 billion (2.9x revenue); MicroFocus’ acquisition of system s management software provider, The Attachmate Group, for $2.3 billion (2.5x EV/Rev;, and Apax Partners’acquisition of ERP provider, Exact Holdings, for $861 million (3.2x EV/Rev).

• Vertical transactions continued to account for about one-third of total software M&A deal volume. The median TTM revenue exit multiplefor vertical software companies was 2.2x, a marked increase over the past two years.

• Select 2014 vertical deals included KBC Advanced Technologies’ acquisition of upstream oil & gas software provider, FEESA, for $19.2million (4.9x EV/Rev); Nemetschek’s acquisition of construction project collaboration software provider Bluebeam Software, for $100million (4.5x EV/Rev); Equifax’s acquisition of debt collection software provider, TDX Group, for $327 million (3.7x EV/Rev); and CognizantTechnology’s acquisition of healthcare insurance and benefits administration software provider, TriZetto Group.

70


SOFTWARE M&A DEAL VOLUME BY PRODUCT CATEGORY

• The Mobile product category, once again,led all others in 2014, accounting for 21.9%of total software M&A transactions,compared to 20.8% in 2013.

• Other active M&A categories in 2014included Financial Services (6.7%), BI, Risk& Compliance (5.0%), & Healthcare (4.5%).

• The CRM, Marketing & Sales, and BI, Risk &Compliance categories, posted the largestyear over year percent increases in dealvolume as a percent of total, accounting for4.5% and 5.0%, respectively, of 2014transactions, compared with 2.1% and3.1%, respectively, in 2013.

• The Engineering, PLM & CAD, and SupplyChain Management, categories posted thesteepest year-over-year declines as apercent of total, accounting for 2.4% and1.8% of deals in 2014, compared to 4.3%and 3.9%, respectively, in 2013.

• The Other Verticals category, whichaccounted for 7.7% of all transactions in2014, included Trimble’s acquisition ofcrime prevention software provider TheOmega Group; First American’s acquisitionof mortgage industry fraud preventionsoftware provider Interthinx, for $155million; and Boeing’s acquisition of aircraftasset management provider, Aerdata.

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al

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als

71


SOFTWARE M&A EXIT VALUATIONS BY PRODUCT CATEGORY

Median EV/Revenue Exit Multiples by Software Product Category

• While we closely monitor 32 on-premise software product categories, only nine had both sufficient deal activity and deal data to ascertain astatistically credible TTM Revenue exit multiple in 2014.

• Among these nine product categories, Healthcare racked up 2014’s highest median TTM Revenue multiple (2.8x), aided by CognizantTechnology’s 3Q14 acquisition of healthcare payer and provider solution software vendor Trizetto, for $2.7 billion (3.8x revenue); andMaquet’s 3Q14 acquisition of hospital systems software provider, Cetrea, for $16.1 million (3.7x EV/Rev).

• Mobile software application sellers came in a close second, commanding a median 2.5x TTM Revenue in 2014, which included Start Today’s3Q14 acquisition of Yappa for $10.2 million (5.0x EV/Rev), and Yahoo’s 3Q14 acquisition of Flurry for ~$300 million (3.0x EV/Revestimate). Mobile was followed by the Content, Document & BPM, and the BI, Risk & Compliance categories, both with a median 2.3x TTMrevenue exit multiple.

• Categories that struggled to excite buyers in 2014 were the CRM & Marketing and Supply Chain Management categories, posting dismal TTMmedian revenue exit multiples of 1.1x and 1.5x, respectively. With cloud offerings now dominating each of these categories, buyers andinvestors were likely acquiring the target’s customers and contracts, rather than its IP and market momentum – a scenario that invariablyyields a significantly lower exit multiple..

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72


SaaS M&A: DEAL VOLUME AND EXIT MULTIPLES

• SaaS M&A transaction volume in 1Q14 equaled the previous high of 104 deals in 2Q13, and set the tone for the rest of the year, withquarterly deal volume consistently growing and chalking up new highs every quarter. As we went to press, 132 SaaS deals closed in thefourth quarter, a number that will likely increase as additional year-end deals are publicly announced.

• SaaS exits have grown a whopping 56% on a CAGR basis over the past 5 years, but SaaS exit rate growth has slowed over the past two years.2014’s SaaS deal volume was about 18% greater than the prior year, accounting for almost one in four of all software industry M&Atransactions.

SaaS M&A Volume - AnnualSaaS M&A Volume - Quarterly

68 6559

94 9486

10497

103104108118

132

0%

5%

10%

15%

20%

25%

30%

0

20

40

60

80

100

120

140

4Q

11

1Q

12

2Q

12

3Q

12

4Q

12

1Q

13

2Q

13

3Q

13

4Q

13

1Q

14

2Q

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SaaS M&A Deals SaaS as % of Software

50

105

200

312

390

462

0

50

100

150

200

250

300

350

400

450

500

2009 2010 2011 2012 2013 2014

# o

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73


SaaS M&A: DEAL VOLUME AND EXIT MULTIPLES

• After reaching a breathtaking 4.0x or greater for each of the past eight quarters, the median SaaS exit multiple on a TTM revenue basisdropped to 3.7x revenue in 4Q14, the same median multiple that prevailed from 3Q11 through 1Q12. The decline is due the elimination ofseveral very high multiple deals posted in 4Q13 from our 4Q14 TTM analysis, including Oracle’s acquisition of Responsys (8.2x), Textura’sacquisition of Latista (10.8x) and Experian’s acquisition of Passport Health (7.0x).

• The 3.7x median SaaS exit multiple for all of 2013 was 61% greater than the 2.3x median on-premise exit multiple for 2014.

• We anticipate the median SaaS exit multiple will remain below 4.0x in 2015 as buyers push back.

Median SaaS EV/Revenue Exit Multiples - Quarterly Median SaaS EV/Revenue Exit Multiples - Annual

Median SaaS EV/Revenue By Size – Since 1Q10• Larger SaaS targets – those that offered buyers not only a fast

path to hosted solutions, vertical markets and compelling pointsolutions, but incremental revenue that could move the buyer’sneedle, commanded a significantly higher exit multiple thantheir smaller SaaS counterparts.

• Based upon SEG’s analysis of 1,469 SaaS M&A transactionssince 2010, SaaS providers with revenue less than $10 millionreceived a median 3.1x revenue exit multiple, while SaaScompanies with revenue greater than $100 millioncommanded a median 4.7x TTM revenue exit valuation.

3.2x 3.7x 4.1x 4.1x 3.7x

2010 2011 2012 2013 2014

4.1x4.6x

4.0x 4.1x 3.7x

4Q13 1Q14 2Q14 3Q14 4Q14

3.1x3.4x

4.5x 4.4x4.7x

<= 10M > 10M & <= 20M > 20M & <= 50M > 50M & <=100M

> 100M

74


SaaS M&A BY PRODUCT CATEGORY

• The 462 SaaS acquisitions that closed in 2014were spread across a wide number of productcategories and vertical markets.

• CRM and Marketing once again led all productcategories in acquisition activity, accountingfor 14.6% of total 2014 SaaS deal volume,slightly lower than 15.1% in 2013.

• The Talent & Workforce Mgmt productcategory, which claimed only 6.4% of SaaStransactions in 2013, rose sharply to 11.1% in2014.

• Indeed, M&A activity across all HR segmentsrebounded in 2014, not surprising considering2014’s improved economy and markedincrease in new hires. Transactions spannedpayroll automation and benefitsadministration to core HRIS to social and datadriven talent management.

• Led by ServiceNow’s $100 million (~20x TTMRevenue) acquisition in 3Q14 of NeebulaSystems, a cloud business service managementtools provider, Systems Management was thethird most active category in 2014, accountingfor 9.2% of all SaaS transactions. However,SaaS infrastructure transactions still laggedwell behind SaaS application deals as a percentof total. That will undoubtedly change asmarket adoption of SaaS infrastructuresolutions grows.

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75


INTERNET M&A: DEAL VOLUME AND EXIT MULTIPLES

• There were 894 Internet M&A transactions in 2014, slightly more than 2013’s tally of 876 Internet deals, but a sustained improvement overthe post-recession Internet deal totals for 2011 and 2010.

• 2012’s Internet deal volume high was spurred by a flurry of Internet acquisitions around the time of Facebook’s IPO. In the ensuing years,Internet deal activity tapered a bit, but has remained healthy. In both 2013 and 2014, quarterly deal volume grew each quarter, with 244transactions closed in 4Q14.

• The median TTM EV/Revenue exit multiple of the SEG Internet Index has held steady at about 2.0x for the past three years, after spiking in2011. The Internet sector remains an M&A ecosystem of haves and have-nots, with extraordinarily wide disparities in exit valuations.

Median EV/Revenue Exit Multiples - AnnualM&A Volume - Annual

452

626

794

978876 894

2009 2010 2011 2012 2013 2014

1.6x

2.7x

1.9x 1.9x 2.0x

2010 2011 2012 2013 2014

76


INTERNET M&A: BY PRODUCT CATEGORY

• Internet ad-tech remained the most active internet M&A category in 2014, accounting for almost 1/3 of all sector transactions.

• Following a wave of social technology deals in 2011/2012 that averaged 30 transactions per quarter, Intenet M&A activity in the Social Techcategory retreated to about 20 transactions per quarter in 2013, and held steady at that rate in 2014.

• The Commerce, Content & Media and Gaming categories each saw higher YoY deal volume in 2014. Gaming’s 60 transactions in 2014represented a 66% increase over 2013’s 36 transactions; Content & Media transactions in 2014 grew 21%, from 154 to 186.

• M&A deal volumes for the remaining Internet categories, measured year-over-year, declined 23.1% for Infrastructure and 10.8% for Ad-Tech, and remained flat for Social Tech.

M&A Volume - Quarterly2014 M&A Volume by Product Category

Category 2013 1Q 2014 2Q 2014 3Q 2014 4Q 2014 2014

Ad-Tech & Lead Gen 297 57 68 73 67 265

Commerce 166 38 41 49 65 193

Content & Media 154 50 41 43 52 186

Gaming 36 10 16 21 13 60

Infrastructure 143 21 25 32 32 110

Social Tech 80 18 24 23 15 80

Total 876 194 215 241 244 894

77


APPENDIX


THE SEG SOFTWARE INDEX COMPANIES – KEY METRICS

79

Company


A10 Networks 7.6x 4.5x 3.5x 0.8x 0.8x 1660.9x - - - - - 18.1% - - 31.8% 0.5% -3.0% -1.0% -1.7% -7.5%

Accretive Health 0.4x 0.3x 0.4x 0.4x 0.4x 5.6x 4.8x 5.3x 5.6x 5.9x -0.2% -0.2% -2.1% -3.1% -1.9% 6.5% 6.5% 6.7% 6.5% 6.6%

ACI Worldwide 3.6x 3.3x 3.1x 3.2x 3.0x 17.3x 15.1x 14.6x 14.5x 14.5x 39.5% 29.8% 33.8% 30.3% 25.2% 21.1% 21.6% 21.0% 21.7% 21.0%

Activision Blizzard 2.9x 3.2x 3.8x 3.5x 3.4x 8.1x 10.0x 12.8x 12.8x 13.5x 7.5% -5.6% -12.7% -13.9% -10.0% 35.5% 32.3% 29.5% 27.2% 25.4%

Actuate 1.5x 1.1x 1.1x 1.1x 1.2x 13.9x 10.9x 19.5x 52.4x - -0.6% -3.1% -11.0% -16.2% -22.1% 10.7% 10.2% 5.9% 2.2% -2.3%

Advent Software 4.9x 4.6x 4.9x 4.7x 4.7x 27.3x 24.8x 26.4x 19.7x 18.6x 6.9% 6.7% 6.3% 5.6% 4.3% 18.1% 18.6% 18.6% 24.1% 25.3%

Allot Communications 4.2x 3.2x 2.5x 1.9x 1.8x - - 452.8x 55.9x 33.5x -4.8% -7.8% -3.8% 8.3% 19.0% -5.1% -0.8% 0.6% 3.4% 5.4%

Allscripts Healthcare Solutions 2.5x 2.4x 2.3x 2.1x 2.1x 360.8x 329.2x 241.7x 96.7x 61.9x -7.4% -5.1% -4.4% -2.2% 1.1% 0.7% 0.7% 1.0% 2.1% 3.3%

Amdocs Limited 1.7x 1.9x 1.8x 1.8x 1.7x 9.4x 10.2x 10.0x 9.6x 9.4x 3.0% 3.6% 4.8% 5.6% 6.5% 18.6% 18.5% 18.4% 18.3% 18.5%

American Software 2.2x 2.0x 1.9x 2.0x 2.0x 13.9x 12.3x 11.8x 12.3x 16.3x -6.6% -3.2% 0.1% 4.4% 1.3% 15.6% 16.6% 16.2% 15.9% 12.3%

ANSYS 8.1x 7.1x 7.3x 7.3x 7.1x 17.5x 15.2x 15.6x 15.6x 15.2x 9.1% 7.9% 8.4% 8.0% 8.5% 46.6% 46.8% 46.8% 46.5% 46.6%

Aruba Networks 3.0x 2.7x 2.7x 2.5x 2.4x 101.9x 162.4x 117.6x 57.9x 33.8x 13.8% 11.6% 15.8% 21.5% 25.8% 3.0% 1.7% 2.3% 4.4% 7.0%

Aspen Technology 12.0x 10.8x 9.9x 7.8x 7.4x 52.6x 39.4x 33.0x 22.9x 20.0x 24.3% 27.3% 27.7% 25.7% 25.5% 22.8% 27.5% 29.9% 34.0% 37.2%

Autodesk 4.5x 4.3x 4.9x 5.2x 5.0x 22.3x 23.1x 28.6x 33.7x 39.4x -0.2% -1.7% 0.1% 3.7% 6.1% 20.1% 18.8% 17.1% 15.3% 12.8%

AVG Technologies 2.3x 2.5x 2.2x 2.5x 2.5x 7.1x 7.1x 6.3x 7.3x 7.1x 19.5% 14.4% 4.8% -3.0% -6.1% 32.6% 35.0% 35.0% 33.6% 35.3%

Bango PLC 8.0x 5.8x 5.4x 7.4x 7.4x - - - - - - -13.7% -16.5% -19.5% -19.5% -35.8% -51.5% -60.4% -71.1% -71.1%

Barracuda Networks 7.4x 5.6x 5.3x 6.5x 6.2x - - 339.6x 204.3x 181.3x - 17.5% 16.5% 16.8% 17.6% -0.1% 0.0% 1.5% 3.2% 3.4%

Blackbaud 3.3x 3.3x 3.5x 3.9x 3.7x 16.4x 16.3x 17.8x 19.7x 20.5x 15.8% 12.6% 10.1% 9.5% 11.8% 20.4% 20.0% 19.7% 19.6% 18.3%

Bottomline Technologies 4.7x 4.1x 3.7x 3.2x 3.1x 46.9x 36.9x 31.2x 28.9x 26.8x 11.5% 11.6% 13.1% 18.0% 20.9% 10.1% 11.0% 11.8% 11.1% 11.5%

Broadridge Financial 1.9x 2.0x 2.1x 2.2x 2.2x 10.1x 10.4x 10.5x 10.6x 10.8x 6.8% 7.3% 7.2% 5.2% 3.6% 18.9% 19.1% 19.6% 20.4% 19.9%

Brocade Communications Systems 1.7x 1.6x 1.6x 1.9x 1.9x 7.4x 6.4x 6.3x 7.2x 7.3x -0.7% -3.0% -2.8% -1.6% -0.5% 23.3% 24.4% 25.5% 26.2% 25.8%

BSQUARE 0.2x 0.2x 0.2x 0.2x 0.2x - - - 96.6x 9.9x -6.9% -9.2% -2.8% 1.2% 4.4% -1.8% -2.0% -1.3% 0.3% 2.4%

CA Technologies 3.0x 2.6x 2.5x 2.7x 2.7x 8.8x 7.7x 7.8x 8.4x 8.8x -4.9% -4.3% -2.1% -1.6% -1.2% 34.3% 33.9% 32.0% 31.7% 30.8%

Cadence Design Systems 2.7x 2.9x 3.2x 3.3x 3.3x 13.0x 13.9x 16.2x 16.6x 16.6x 10.1% 10.1% 8.8% 7.4% 7.4% 20.9% 20.9% 19.8% 19.9% 19.9%

Cerner 6.6x 6.1x 6.3x 6.4x 6.4x 25.3x 23.2x 23.9x 24.3x 24.3x 8.8% 8.8% 11.1% 15.2% 15.2% 26.2% 26.2% 26.3% 26.5% 26.5%

Check Point Software Tech 8.4x 8.1x 8.3x 9.2x 9.1x 15.1x 14.7x 15.1x 16.9x 16.6x 3.4% 3.8% 4.5% 5.3% 6.3% 55.8% 55.4% 55.1% 54.7% 54.5%

Cimatron 1.8x 1.3x 1.1x 0.9x 0.9x 11.9x 8.5x 7.3x 6.2x 6.0x 4.0% 4.6% 5.8% 6.4% 6.3% 15.1% 14.7% 15.0% 15.2% 15.5%

Cisco Systems 1.7x 2.0x 2.1x 2.2x 2.2x 6.1x 7.0x 7.4x 8.1x 8.0x 4.6% 1.3% -1.4% -3.0% -3.1% 28.5% 28.2% 28.0% 27.3% 27.5%

Citrix Systems 3.6x 3.3x 4.0x 3.6x 3.6x 16.6x 14.8x 17.4x 15.3x 16.1x 15.8% 12.8% 12.2% 9.4% 8.3% 21.9% 22.2% 22.7% 23.8% 22.3%

ClickSoftware Technologies Ltd 2.4x 2.3x 2.1x 1.7x 1.6x - - - - - 5.5% 3.1% 4.2% 9.1% 21.3% -0.7% -3.0% -4.5% -3.0% -0.3%

CommVault Systems 5.1x 3.3x 3.3x 2.9x 2.9x 29.1x 18.1x 18.1x 17.1x 20.1x 21.4% 20.4% 18.2% 16.5% 13.1% 17.6% 18.2% 18.2% 17.1% 14.4%

Computer Programs and Sys 3.5x 3.4x 3.3x 3.2x 3.1x 14.0x 12.5x 12.1x 11.5x 10.9x 11.2% 9.6% 8.0% 3.7% 6.2% 25.3% 26.7% 27.3% 27.9% 28.5%

Constellation 4.1x 4.3x 4.1x 4.3x 4.0x 30.0x 33.3x 36.8x 43.2x 39.6x 36.6% 35.9% 41.7% 40.8% 38.7% 13.8% 12.9% 11.2% 9.9% 10.1%

CSG Systems International 1.3x 1.3x 1.3x 1.3x 1.3x 7.9x 7.6x 8.2x 7.9x 8.0x 0.6% -1.2% 0.3% -0.2% 0.2% 17.1% 16.8% 16.2% 16.0% 15.8%

Cyan 0.8x 1.2x 1.3x 1.0x 1.1x - - - - - 58.4% 21.6% 1.2% -12.5% -27.5% -20.7% -29.9% -40.8% -49.9% -59.6%

Cyberark Software - - 11.4x 13.1x 11.4x - - 86.9x 103.3x 69.1x 29.8% 40.1% - - - 16.9% 14.4% 13.2% 12.6% 16.5%

Cyren 3.1x 2.6x 2.3x 1.5x 1.6x - - - - - 33.4% 34.9% 25.0% 15.2% 5.0% -2.1% -7.7% -10.6% -13.7% -16.8%

SEG Software Index

EV/Revenue EV/EBITDA TTM Revenue Growth EBITDA Margin



80

Company


Dassault Systèmes 4.5x 4.8x 5.4x 5.1x 5.3x 14.5x 15.2x 18.1x 17.7x 18.3x 4.4% 1.9% 1.6% 2.3% 5.9% 30.9% 31.5% 29.7% 28.6% 29.1%

DST Systems 1.7x 1.6x 1.6x 1.6x 1.5x 11.2x 9.8x 9.9x 9.9x 9.8x 4.3% 3.2% 2.1% 2.0% 2.3% 15.5% 16.2% 16.0% 15.8% 15.8%

Electronic Arts 1.9x 2.4x 2.7x 2.9x 2.7x 15.9x 40.4x 39.4x 30.3x 16.9x -7.8% -7.5% -5.8% 1.3% 9.5% 11.7% 6.0% 6.9% 9.5% 15.9%

EMC 2.3x 2.3x 2.5x 2.5x 2.4x 9.5x 9.4x 10.7x 10.7x 10.5x 6.2% 6.9% 5.9% 5.7% 6.7% 23.8% 24.2% 23.7% 23.1% 23.0%

EPIQ Systems 1.9x 1.7x 1.8x 1.9x 1.9x 10.1x 10.3x 11.9x 14.3x 15.2x 24.9% 27.2% 23.9% 21.7% 12.5% 18.9% 16.6% 15.1% 13.2% 12.6%

Evertec 7.4x 7.2x 6.9x 6.6x 6.6x 19.7x 18.5x 17.3x 15.9x 15.7x 5.5% 4.6% 3.1% 2.2% 1.5% 37.9% 39.0% 40.0% 41.7% 42.1%

Evolving Systems 3.6x 3.3x 4.0x 3.9x 3.7x 13.6x 13.8x 18.7x 15.9x 14.0x 4.4% -4.4% -7.4% 3.9% 12.9% 26.5% 23.8% 21.4% 24.6% 26.5%

F5 Networks 5.1x 4.8x 5.0x 5.2x 4.8x 16.1x 15.7x 16.4x 16.9x 15.5x 7.6% 7.2% 11.3% 14.7% 17.5% 31.5% 30.8% 30.7% 30.8% 31.1%

Fair Isaac 3.0x 3.2x 3.1x 3.6x 3.4x 11.4x 12.2x 11.9x 13.8x 13.7x 9.9% 6.0% 3.9% 2.5% 6.1% 26.7% 25.9% 26.4% 26.0% 25.2%

FalconStor Software 0.8x 0.9x 0.7x 0.6x 0.6x - - - - - -15.2% -22.2% -22.4% -23.5% -26.1% -11.5% -12.4% -10.7% -9.2% -11.3%

Fidessa 3.2x 3.0x 2.8x 2.8x 2.8x 16.2x 15.3x 14.7x 14.8x 14.8x -1.0% 0.1% 0.1% 0.1% 0.1% 19.6% 19.4% 19.1% 18.8% 18.8%

Fiserv 3.9x 3.8x 3.9x 4.1x 4.1x 13.3x 13.3x 13.5x 14.1x 13.8x 5.5% 8.5% 9.0% 7.6% 6.8% 29.0% 28.9% 29.1% 29.3% 29.7%

Fortinet 5.2x 5.0x 5.5x 5.6x 5.3x 32.0x 35.3x 42.1x 44.5x 45.3x 17.0% 15.3% 17.4% 20.0% 22.9% 16.3% 14.1% 13.1% 12.5% 11.6%

GameLoft SA 2.5x 2.2x 1.5x 1.1x 1.1x 16.4x 14.4x 11.5x 9.6x 9.6x 16.6% 12.0% 8.7% 5.7% 5.7% 15.5% 15.6% 13.4% 11.3% 11.3%

Gigamon 6.0x 2.9x 1.5x 2.3x 2.3x - - - - - 45.1% 45.1% 38.2% 15.4% 15.4% -19.5% -19.5% -25.8% -11.4% -11.4%

Glu Mobile 3.6x 2.8x 3.5x 2.5x 1.9x - - - - 77.5x -7.4% -2.4% 18.2% 40.0% 90.7% -15.5% -13.2% -6.0% -2.4% 2.5%

Gree 1.4x 1.3x 1.1x 0.9x 1.1x 4.2x 4.1x 3.1x 2.7x 3.2x -9.7% -12.7% -12.4% -17.5% -22.7% 33.5% 31.6% 34.2% 33.5% 33.6%

GSE Systems 0.3x 0.2x 0.2x 0.2x 0.2x - - - - - -12.1% -9.0% -14.3% -16.2% -22.7% -4.9% -6.8% -8.9% -10.4% -13.7%

Guidance Software 2.4x 2.3x 1.9x 1.6x 1.6x - - - - - -3.5% -14.6% -16.4% -14.1% -8.8% -7.9% -12.3% -10.9% -9.2% -6.7%

Guidewire Software 9.3x 7.0x 7.8x 8.6x 8.2x 129.9x 149.3x 159.7x 126.1x 91.0x 25.1% 21.2% 21.2% 16.5% 19.6% 7.2% 4.7% 4.9% 6.8% 9.1%

Hewlett Packard 0.6x 0.6x 0.7x 0.7x 0.7x 5.2x 5.5x 5.7x 5.8x 5.7x -6.7% -5.6% -3.2% -0.8% -0.8% 11.4% 11.5% 11.5% 11.5% 11.8%

IBM 2.2x 2.2x 2.3x 2.0x 2.1x 8.5x 8.9x 9.0x 7.8x 8.5x -4.2% -4.6% -4.3% -3.3% -7.0% 26.4% 25.1% 25.5% 25.6% 24.9%

iDream Sky Technologies - - 12.8x 10.2x 10.2x - - 61.7x 49.0x 49.0x - 1172.4% - - - -39.7% 15.3% 20.8% 20.8% 20.8%

Imperva 10.5x 3.5x 4.6x 7.0x 6.6x - - - - - 32.5% 32.2% 26.4% 25.2% 22.5% -10.9% -16.5% -23.5% -28.7% -32.5%

Informatica 4.1x 3.5x 3.0x 3.3x 3.2x 25.1x 20.2x 16.9x 17.9x 17.3x 12.8% 16.8% 17.7% 16.6% 12.5% 16.3% 17.3% 17.9% 18.4% 18.7%

Intuit 5.0x 4.9x 4.9x 5.4x 5.4x 14.7x 15.7x 14.5x 16.5x 16.9x 11.5% 12.2% 15.1% 8.0% 7.7% 34.0% 31.4% 33.9% 33.0% 31.8%

Jack Henry & Associates 4.1x 4.1x 4.0x 4.1x 4.0x 12.7x 12.0x 11.8x 11.9x 11.6x 9.9% 9.8% 9.1% 7.1% 6.9% 32.5% 34.0% 34.1% 34.5% 34.5%

Juniper Networks 2.5x 2.2x 2.0x 1.8x 1.8x 15.7x 12.7x 11.6x 10.2x 10.1x 4.4% 7.0% 8.8% 8.7% 5.8% 16.0% 17.0% 17.0% 17.6% 18.0%

King Digital Entertainment 4.2x 2.6x 1.6x 1.6x 1.7x 10.7x 6.8x 4.4x 4.4x 5.1x - 1046.1% 555.3% 213.8% 73.1% 38.9% 38.2% 35.8% 36.3% 32.9%

Konami 1.4x 1.5x 1.5x 1.2x 1.3x 13.0x 12.8x 17.7x 9.9x 10.4x -12.9% -4.1% -3.7% -0.8% 0.5% 11.0% 11.3% 8.3% 11.6% 12.2%

Magic Software Enterprises 2.0x 1.9x 1.5x 1.4x 1.3x 10.5x 9.7x 8.0x 7.1x 6.9x 15.2% 14.7% 17.5% 16.0% 16.8% 19.5% 19.1% 19.2% 19.2% 19.3%

Manhattan Associates 6.2x 5.7x 5.2x 6.3x 6.1x 24.4x 22.2x 18.9x 23.0x 22.1x 10.4% 10.2% 13.1% 15.7% 16.7% 25.3% 25.8% 27.2% 27.4% 27.5%

Mavenir Systems 4.5x 3.3x 3.1x 2.8x 2.6x - - - - - 12.0% 37.2% 41.0% 40.3% 35.5% -7.3% -3.7% -3.4% -4.1% -4.0%

MedAssets 3.2x 3.2x 3.2x 3.0x 3.0x 10.5x 10.6x 10.6x 10.2x 10.0x 6.4% 6.3% 2.3% 1.8% 2.8% 30.7% 30.6% 29.8% 29.6% 29.9%

Mentor Graphics 2.3x 2.1x 2.1x 2.1x 2.1x 12.9x 10.0x 10.6x 11.1x 11.1x 0.8% 6.2% 10.7% 10.1% 11.0% 17.8% 20.7% 20.0% 19.1% 18.9%

Merge Healthcare 1.8x 1.8x 2.0x 2.3x 2.4x 27.1x 16.5x 17.2x 17.3x 13.1x -2.3% -6.9% -13.0% -12.3% -12.5% 6.7% 11.1% 11.6% 13.4% 18.0%

Microsoft 3.1x 3.2x 3.7x 3.8x 3.6x 7.8x 8.3x 9.6x 10.2x 9.8x 11.1% 14.4% 9.6% 11.5% 13.9% 39.9% 39.0% 38.5% 37.0% 36.3%

SEG Software Index




81

Company


MicroStrategy 1.9x 1.9x 2.1x 2.5x 2.4x 29.9x 27.1x 29.6x 48.6x 64.8x -0.7% 1.8% 4.7% 4.9% 5.5% 6.2% 7.0% 7.0% 5.1% 3.8%

Millennial Media 2.9x 1.5x 0.6x 0.4x 0.4x - 327.5x - - - 42.9% 45.9% 45.4% 38.2% 39.0% -2.1% 0.4% -1.8% -4.7% -7.1%

MIND C.T.I. 1.2x 1.3x 1.9x 2.0x 1.8x 7.7x 9.7x 11.2x 9.5x 7.0x -10.6% -8.6% 1.8% 16.7% 28.6% 15.3% 13.0% 17.3% 21.1% 26.1%

MobileIron - 6.5x 5.6x 5.0x 4.7x - - - - - 195.1% 158.2% - - - -113.8% -24.5% -33.8% -40.7% -43.4%

Model N 1.7x 1.5x 1.4x 1.8x 1.9x 42.6x 69.4x - - - 20.9% 14.2% 4.7% -8.3% -19.8% 3.9% 2.1% -1.9% -11.6% -22.4%

Momo - - - 125.2x 74.7x - - - - - - - - - - - -272.2% -103.4% -72.4% -84.4%

Monotype Imaging Holdings 6.5x 5.8x 6.2x 5.8x 5.6x 18.6x 16.6x 18.1x 17.1x 16.7x 14.1% 11.2% 8.3% 9.0% 11.4% 35.1% 34.9% 34.2% 34.0% 33.5%

MSCI 6.1x 5.3x 5.2x 5.2x 5.1x 13.0x 12.2x 12.3x 12.6x 12.7x -0.6% 9.0% 12.3% 16.3% 19.6% 46.8% 43.6% 42.5% 41.2% 40.1%

Myriad Group AG 3.5x 3.3x 6.4x 10.1x 10.1x - - - - - -10.8% -23.3% -20.4% -17.3% -17.3% -17.0% -16.0% -11.4% -6.8% -6.8%

NetApp 1.5x 1.2x 1.5x 1.5x 1.5x 10.2x 8.0x 8.9x 9.1x 9.1x 2.5% 1.2% -0.1% -1.7% -1.9% 14.6% 15.2% 16.2% 16.4% 16.4%

Netscout Systems 3.7x 3.7x 4.2x 3.2x 3.1x 16.8x 15.7x 17.8x 13.2x 12.7x 9.0% 11.8% 13.1% 18.7% 16.8% 22.1% 23.7% 23.6% 24.6% 24.2%

NetSol Technologies 1.2x 1.1x 1.1x 1.4x 1.4x 2.6x 3.2x 7.0x - - 22.6% 2.3% -17.9% -21.7% -25.8% 43.9% 33.4% 15.2% -8.9% -20.2%

NeuStar 3.0x 2.2x 2.3x 2.1x 2.1x 7.0x 5.6x 5.9x 5.7x 5.8x 11.0% 8.5% 7.9% 8.2% 8.0% 42.0% 39.9% 38.4% 37.6% 36.2%

NICE Systems Ltd 2.5x 2.3x 2.3x 2.7x 2.6x 14.4x 12.9x 13.0x 15.9x 15.5x 7.2% 8.0% 6.8% 6.8% 7.7% 17.5% 18.0% 17.5% 16.9% 16.9%

NQ Mobile 5.1x 2.2x 1.2x 2.1x 1.3x 151.0x 296.0x 166.5x 276.6x - 113.0% 114.3% 114.3% 114.3% 95.4% 3.4% 0.7% 0.7% 0.7% -19.1%

Nuance Communications, Inc. 3.4x 3.6x 3.7x 3.3x 3.2x 26.7x 32.1x 35.9x 36.2x 34.1x 12.3% 6.3% 4.1% 2.2% 3.7% 12.9% 11.3% 10.2% 9.1% 9.5%

Omnicell 2.4x 2.3x 2.2x 2.6x 2.4x 17.1x 16.6x 15.3x 17.4x 16.1x 27.3% 21.2% 17.3% 14.4% 16.5% 13.8% 13.8% 14.3% 14.7% 15.2%

Open Text Corp 4.4x 4.9x 5.2x 4.8x 4.4x 18.6x 20.6x 20.3x 17.4x 15.2x 9.3% 7.6% 11.8% 19.2% 28.8% 23.6% 23.9% 25.5% 27.6% 29.3%

Opera 6.0x 5.2x 5.4x 5.0x 4.2x 21.5x 20.0x 21.5x 20.2x 18.5x 36.5% 38.9% 40.7% 39.9% 53.3% 27.9% 26.0% 25.2% 24.5% 22.7%

Oracle 4.2x 4.5x 4.3x 4.2x 4.2x 9.7x 10.3x 9.9x 9.6x 9.5x 0.9% 2.0% 2.9% 3.0% 3.4% 43.5% 43.6% 43.7% 43.7% 43.6%

Palo Alto Networks 10.6x 9.6x 11.5x 14.1x 12.8x - - - - - 54.4% 49.2% 48.1% 51.0% 51.1% -1.9% -4.1% -5.6% -7.5% -8.8%

Pandora Media 10.9x 5.6x 7.0x 4.6x 4.2x - - - - - 53.5% - - - - -7.1% -1.0% -1.0% -1.4% -1.0%

Parametric Technology 3.3x 3.3x 3.5x 3.4x 3.4x 15.8x 15.9x 15.9x 15.4x 15.4x 3.3% 3.3% 3.4% 4.8% 4.9% 20.8% 20.8% 21.8% 22.3% 21.9%

PDF Solutions 5.9x 4.7x 4.9x 2.7x 2.8x 20.1x 14.4x 14.0x 7.8x 8.9x 17.8% 13.3% 12.3% 9.5% 3.0% 29.5% 32.6% 34.8% 35.4% 31.8%

Pegasystems 3.0x 2.5x 2.7x 2.4x 2.4x 18.6x 15.4x 17.1x 16.9x 18.8x 15.3% 10.2% 14.2% 16.7% 15.0% 16.2% 15.9% 15.8% 14.4% 12.6%

Progress Software 3.1x 2.7x 3.0x 3.2x 3.1x 10.9x 9.5x 10.1x 10.3x 10.0x 5.2% 1.9% -0.8% -1.2% -0.4% 28.0% 28.3% 29.3% 30.9% 31.3%

Proofpoint 10.6x 7.8x 9.0x 9.6x 8.7x - - - - - 25.3% 29.8% 33.3% 39.0% 43.3% -12.9% -12.2% -13.1% -14.8% -15.7%

PROS Holdings 7.0x 4.8x 4.6x 4.5x 4.3x 104.5x 73.0x 211.2x - - 24.6% 23.0% 22.3% 22.1% 23.2% 6.7% 6.6% 2.2% -0.6% -2.7%

QAD 0.9x 0.9x 0.9x 0.9x 0.9x 21.1x 18.2x 15.9x 16.4x 14.1x 2.8% 5.6% 9.0% 10.3% 11.8% 4.2% 5.1% 5.7% 5.7% 6.5%

Qihoo 360 Technology 21.1x 16.0x 13.4x 8.5x 7.1x 79.8x 52.3x 44.8x 31.8x 28.8x 91.5% 104.0% 123.6% 121.3% 113.8% 26.4% 30.6% 29.8% 26.6% 24.7%

Qiwi 5.3x 4.0x 4.8x 3.1x 3.3x 23.7x 17.4x 18.9x 11.1x 10.8x - 30.9% 30.0% 26.3% 26.1% 22.4% 23.1% 25.6% 27.5% 30.8%

Qlik Technologies 5.1x 3.7x 4.5x 4.8x 4.5x 525.3x 151.4x 380.6x 287.3x 578.9x 24.2% 21.1% 19.5% 18.8% 20.1% 1.0% 2.5% 1.2% 1.7% 0.8%

Quality Systems 2.2x 1.9x 1.8x 1.7x 1.6x 11.2x 11.9x 13.0x 15.3x 12.1x -2.1% -3.7% -3.4% 0.3% 8.2% 19.7% 16.3% 13.9% 11.1% 13.2%

Radware 3.4x 3.1x 3.0x 3.8x 3.6x 21.2x 20.3x 20.9x 28.0x 24.4x 2.9% 2.0% 5.1% 8.4% 12.7% 16.1% 15.4% 14.4% 13.5% 14.8%

Red Hat 6.8x 5.6x 6.4x 6.2x 6.0x 33.2x 27.7x 33.4x 33.0x 32.3x 16.0% 15.5% 15.8% 16.6% 16.5% 20.4% 20.1% 19.2% 18.9% 18.6%

Redknee Solutions 3.5x 2.5x 1.3x 1.2x 1.2x 191.9x 70.3x 23.7x 96.0x 43.3x 149.8% 226.0% 349.5% 156.4% 81.4% 1.8% 3.6% 5.6% 1.2% 2.7%

Riverbed Technology 3.3x 3.1x 2.9x 2.9x 2.9x 25.4x 21.8x 18.9x 18.0x 16.8x 24.0% 24.4% 17.7% 12.9% 9.4% 13.0% 14.2% 15.3% 16.2% 17.0%

SEG Software Index




82

Company


Saba Software, Inc. - - - - - - - - - - 7.7% 7.7% 7.7% 7.7% 7.7% -8.7% -8.7% -8.7% -8.7% -8.7%

Sage Group 3.7x 3.6x 3.4x 3.1x 3.3x 12.6x 12.3x 11.7x 10.6x 11.5x 2.7% -0.5% -3.7% -4.4% -5.0% 29.1% 29.3% 29.5% 29.0% 28.4%

SAP 4.3x 4.0x 4.0x 3.6x 3.9x 12.8x 11.6x 11.7x 10.4x 12.0x 6.6% 3.6% 2.7% 2.2% 4.4% 33.2% 34.2% 34.4% 34.5% 32.9%

Sapiens International 2.3x 2.2x 2.1x 2.1x 2.0x 18.7x 19.1x 19.0x 18.2x 17.2x 21.5% 18.8% 17.6% 16.6% 16.5% 12.3% 11.3% 11.3% 11.6% 11.8%

Silver Spring Networks 2.4x 1.6x 1.2x 1.1x 1.4x - - - - - 34.5% 66.1% 62.8% 3.5% -24.6% -19.8% -10.8% -7.3% -22.7% -38.5%

Software AG 2.4x 2.3x 1.7x 1.7x 1.9x 9.5x 9.4x 6.8x 7.1x 7.8x -8.1% -7.1% -6.0% -8.2% -9.8% 25.6% 25.0% 24.8% 23.6% 24.2%

SolarWinds 9.8x 8.3x 8.4x 9.3x 8.8x 21.7x 19.9x 22.2x 26.5x 26.3x 24.2% 24.7% 27.0% 29.3% 30.6% 45.4% 41.7% 38.1% 35.2% 33.3%

Sourcefire 1.2x 1.1x 1.0x 0.7x 0.8x 49.1x 10.7x 7.7x 5.8x 10.9x 5.6% 25.2% 36.0% 43.9% 20.2% 2.4% 10.6% 13.6% 12.7% 7.6%

Splunk 32.3x 17.2x 14.6x 18.3x 16.6x - - - - - 51.4% 52.1% 51.3% 51.6% 50.6% -16.4% -23.3% -31.3% -40.8% -44.9%

SS&C 5.8x 5.8x 5.9x 6.4x 6.3x 14.7x 14.6x 15.0x 16.4x 16.0x 47.5% 29.1% 14.9% 7.1% 6.8% 39.5% 39.5% 39.6% 39.0% 39.1%

Stratasys 13.1x 8.6x 9.5x 7.9x 7.0x 82.5x 51.8x 60.4x 54.2x 63.4x 113.4% 125.0% 101.2% 88.0% 71.8% 15.9% 16.6% 15.7% 14.6% 11.1%

Symantec 1.9x 1.9x 2.2x 2.3x 2.3x 6.6x 6.6x 7.5x 8.1x 8.0x -0.6% -3.3% -3.3% -3.5% -2.9% 28.5% 29.1% 29.1% 29.0% 29.2%

Synchronoss Technologies 3.8x 3.6x 4.5x 4.6x 4.2x 19.0x 16.1x 18.6x 17.7x 15.6x 23.7% 27.5% 28.5% 27.8% 30.5% 20.2% 22.2% 24.0% 25.7% 26.7%

Synopsys 2.7x 2.6x 2.8x 2.8x 2.8x 14.8x 14.2x 15.8x 15.9x 15.4x 11.7% 8.9% 6.0% 5.8% 4.9% 18.4% 18.3% 17.6% 17.8% 18.0%

Take-Two Interactive 1.5x 0.6x 0.7x 0.8x 0.8x - 3.1x 3.6x 4.2x 3.6x 13.9% 130.9% 93.5% 106.3% 129.5% -4.0% 19.7% 18.4% 19.3% 22.4%

Tangoe 3.7x 2.9x 2.5x 2.3x 2.2x 40.9x 33.0x 31.6x 32.2x 32.2x 30.8% 22.3% 17.7% 14.4% 13.5% 9.0% 8.7% 8.1% 7.2% 7.0%

TeleCommunication Systems 0.5x 0.7x 0.7x 0.7x 0.7x 6.7x 12.4x 11.5x 9.8x 9.3x -12.6% -25.7% -26.9% -24.8% -17.1% 7.9% 5.9% 6.3% 7.4% 7.8%

TeleNav 0.3x 0.4x 0.5x 0.9x 0.9x 5.1x 29.7x - - - -0.9% -6.2% -16.9% -21.6% -27.2% 6.3% 1.4% -7.8% -15.7% -24.4%

Teradata 2.6x 2.3x 2.2x 2.2x 2.2x 11.4x 9.9x 9.3x 9.4x 9.4x 2.5% 1.0% 3.6% 3.6% 2.9% 22.5% 23.1% 23.7% 23.2% 23.0%

The Descartes Systems Group 5.8x 5.6x 6.3x 6.0x 5.8x 20.7x 19.9x 22.3x 20.9x 20.1x 18.0% 19.2% 20.6% 17.2% 15.3% 28.2% 28.1% 28.2% 28.7% 29.1%

Trend Micro 2.8x 3.1x 3.2x 2.8x 3.0x 8.4x 9.2x 9.3x 8.0x 8.6x 11.3% 15.4% 13.5% 9.8% 7.8% 33.7% 33.9% 34.7% 35.1% 35.0%

Tyler Technologies 7.6x 6.1x 6.6x 7.6x 7.2x 40.9x 32.4x 34.0x 36.9x 33.6x 14.6% 14.7% 15.2% 17.2% 18.7% 18.5% 18.9% 19.5% 20.5% 21.5%

Varonis Systems 15.3x 6.5x 5.4x 5.1x 4.7x - - - - - - 39.7% 43.7% 38.0% 38.3% -6.5% -6.8% -11.1% -14.0% -16.0%

VASCO Data Security International 1.4x 2.1x 2.8x 5.4x 5.0x 13.2x 19.5x 25.4x 40.9x 30.4x -8.0% 0.7% 0.9% 14.3% 21.1% 10.5% 10.6% 10.9% 13.3% 16.6%

Verint Systems Inc 3.1x 3.0x 3.9x 4.0x 3.8x 17.2x 16.5x 23.6x 27.5x 28.6x 7.0% 8.1% 13.2% 18.3% 21.8% 18.1% 18.1% 16.6% 14.5% 13.2%

Verisk 8.0x 6.8x 6.9x 6.7x 6.6x 16.3x 14.8x 15.2x 14.7x 14.4x -0.1% 13.3% 13.3% 14.2% 15.7% 49.2% 46.1% 45.6% 45.4% 45.4%

VMWare 7.1x 7.0x 6.8x 5.5x 5.3x 27.1x 24.8x 24.6x 21.1x 21.0x 14.7% 13.1% 13.4% 15.0% 15.9% 26.3% 28.1% 27.8% 26.0% 25.2%

Zynga 2.9x 2.6x 2.5x 2.1x 2.2x 20.8x 31.2x 58.8x - - -21.3% -31.8% -36.5% -37.6% -33.1% 13.9% 8.4% 4.2% -2.5% -11.7%


SEG Software Index


THE SEG SOFTWARE INDEX METRICS BY PRODUCT CATEGORY

83

Billing & Service Management 4Q13 1Q14 2Q14 3Q14 4Q14

EV/Revenue 3.0x 2.2x 1.9x 2.0x 1.8x

EV/EBITDA 9.4x 10.2x 11.2x 9.6x 9.4x

EV/Earnings 16.7x 17.0x 21.7x 18.5x 18.4x

Gross Profit Margin 57.8% 57.4% 57.3% 56.3% 55.4%

EBITDA Margin 18.6% 18.5% 18.4% 21.1% 26.1%

Net Income Margin 12.3% 11.8% 12.2% 11.7% 11.8%

TTM Revenue Growth (YoY) 4.4% 3.6% 4.8% 8.2% 12.9%

TTM EBITDA Growth (YoY) -6.9% 1.6% 1.7% -0.5% 13.1%

TTM Earnings Growth (YoY) -9.6% -4.8% -9.2% -3.3% 5.3%

Current Ratio 2.3 2.4 2.7 2.7 2.6

Cash as Percent of Market Cap 14.2% 15.9% 15.0% 18.2% 19.3%

Enterprise Value Growth (YoY) 31.0% 26.1% 33.1% 23.2% 2.5%

Business Intelligence 4Q13 1Q14 2Q14 3Q14 4Q14


EV/EBITDA 16.3x 14.8x 16.9x 15.8x 14.4x



EBITDA Margin 16.2% 15.9% 15.8% 14.4% 12.6%



TTM EBITDA Growth (YoY) -2.0% -0.3% 4.2% -0.6% -10.6%

TTM Earnings Growth (YoY) -6.9% -8.7% -2.6% 0.1% -4.2%

Current Ratio 2.1 2.0 1.9 1.9 2.0


Enterprise Value Growth (YoY) 37.5% 15.1% 4.3% -13.3% -9.2%

Development Platforms 4Q13 1Q14 2Q14 3Q14 4Q14


EV/EBITDA 10.9x 9.7x 10.1x 21.7x 9.9x



EBITDA Margin 20.0% 19.6% 19.2% 19.0% 19.0%


TTM Revenue Growth (YoY) 2.3% -0.6% -1.8% 0.0% 1.6%

TTM EBITDA Growth (YoY) -0.1% -1.5% 1.7% 12.9% 7.1%

TTM Earnings Growth (YoY) -5.2% -18.6% -17.1% -6.5% -9.7%

Current Ratio 2.1 2.0 1.9 2.1 2.1


Enterprise Value Growth (YoY) 16.6% 6.8% 6.6% 1.9% -0.6%

Engineering & PLM 4Q13 1Q14 2Q14 3Q14 4Q14


EV/EBITDA 15.8x 15.2x 15.9x 15.9x 15.4x



EBITDA Margin 20.5% 20.7% 19.9% 19.5% 19.4%



TTM EBITDA Growth (YoY) 8.6% 17.6% 7.5% 5.6% 8.8%

TTM Earnings Growth (YoY) 5.0% 11.9% -1.2% 17.7% 8.0%

Current Ratio 2.3 2.3 2.2 2.0 2.1



Enterprise Resource Planning 4Q13 1Q14 2Q14 3Q14 4Q14


EV/EBITDA 12.8x 12.3x 11.7x 10.6x 11.5x



EBITDA Margin 29.1% 29.3% 29.5% 29.0% 28.4%




TTM Earnings Growth (YoY) -6.8% 0.2% 16.0% 7.7% 6.6%

Current Ratio 1.1 1.2 1.2 1.2 1.2



Financial & Accounting 4Q13 1Q14 2Q14 3Q14 4Q14


EV/EBITDA 14.7x 15.1x 14.0x 14.1x 13.8x



EBITDA Margin 26.7% 25.9% 25.6% 26.0% 25.2%




TTM Earnings Growth (YoY) 4.4% 2.0% 11.0% 34.2% 34.4%

Current Ratio 1.6 1.3 1.2 1.3 1.3



Gaming 4Q13 1Q14 2Q14 3Q14 4Q14


EV/EBITDA 13.0x 11.4x 12.1x 9.8x 10.0x



EBITDA Margin 13.6% 17.7% 15.9% 15.5% 19.2%


TTM Revenue Growth (YoY) 10.7% -3.6% -4.8% 0.2% 3.1%

TTM EBITDA Growth (YoY) 33.0% -1.1% -3.8% -19.1% -12.4%


Current Ratio 2.0 2.4 3.0 3.2 3.0



Healthcare 4Q13 1Q14 2Q14 3Q14 4Q14


EV/EBITDA 15.6x 14.5x 14.1x 16.3x 14.6x



EBITDA Margin 16.8% 15.0% 14.1% 14.1% 16.6%



TTM EBITDA Growth (YoY) -0.7% 1.1% 1.6% 8.4% 16.2%


Current Ratio 1.7 1.8 1.6 1.6 1.5



IT Conglomerates 4Q13 1Q14 2Q14 3Q14 4Q14


EV/EBITDA 8.5x 8.9x 9.6x 9.6x 9.5x



EBITDA Margin 33.2% 34.2% 34.4% 34.5% 35.1%




TTM Earnings Growth (YoY) 5.2% 11.9% 8.1% 3.1% -2.0%

Current Ratio 1.2 1.3 1.2 1.2 1.1



Mobile Solutions/Content 4Q13 1Q14 2Q14 3Q14 4Q14


EV/EBITDA 19.9x 29.7x 26.6x 20.2x 18.5x



EBITDA Margin 6.3% 3.7% 2.5% -0.3% 0.7%

Net Income Margin 1.6% -1.8% -3.2% -6.9% -9.6%


TTM EBITDA Growth (YoY) -4.0% 14.9% 0.1% 1.3% -13.1%


Current Ratio 2.7 2.6 2.9 3.1 2.8



Networking & Network Perf Mgmt 4Q13 1Q14 2Q14 3Q14 4Q14


EV/EBITDA 18.6x 15.7x 18.9x 18.0x 16.8x



EBITDA Margin 3.0% 1.7% 2.3% 4.4% 7.0%

Net Income Margin -3.7% -1.6% -0.4% 0.7% 1.5%


TTM EBITDA Growth (YoY) -5.9% -0.1% -1.1% 14.8% 18.9%

TTM Earnings Growth (YoY) 6.9% -0.8% 3.3% 9.7% 12.2%

Current Ratio 2.5 2.6 2.7 2.8 2.6



Security 4Q13 1Q14 2Q14 3Q14 4Q14


EV/EBITDA 14.1x 10.7x 15.1x 16.9x 16.6x



EBITDA Margin 2.4% 10.6% 10.9% 12.5% 7.6%



TTM EBITDA Growth (YoY) -13.7% -20.4% -7.3% -7.0% 0.4%


Current Ratio 1.5 1.7 1.8 1.9 1.9




THE SEG SOFTWARE INDEX METRICS BY PRODUCT CATEGORY

84

Storage, Data Mgmt & Integration 4Q13 1Q14 2Q14 3Q14 4Q14


EV/EBITDA 9.5x 8.0x 8.9x 9.1x 9.1x



EBITDA Margin 16.9% 17.8% 18.0% 17.7% 17.5%



TTM EBITDA Growth (YoY) 3.9% 8.0% 8.5% 8.8% -1.8%


Current Ratio 2.4 2.4 2.5 2.5 2.5



Systems Management 4Q13 1Q14 2Q14 3Q14 4Q14


EV/EBITDA 19.2x 17.8x 20.0x 18.2x 18.5x



EBITDA Margin 24.2% 25.9% 25.7% 25.3% 25.0%





Current Ratio 1.6 1.3 1.3 1.2 1.4


Enterprise Value Growth (YoY) -9.2% 12.0% 6.5% 12.3% 19.5%

Vertical - Finance 4Q13 1Q14 2Q14 3Q14 4Q14


EV/EBITDA 13.9x 13.4x 13.5x 13.7x 13.8x



EBITDA Margin 26.0% 26.7% 26.8% 29.3% 29.9%





Current Ratio 1.3 1.3 1.4 1.4 1.4



Vertical - Other 4Q13 1Q14 2Q14 3Q14 4Q14


EV/EBITDA 24.4x 25.7x 26.5x 28.3x 27.0x



EBITDA Margin 13.8% 12.9% 11.3% 11.6% 11.8%




TTM Earnings Growth (YoY) 23.5% -0.5% 12.1% 7.8% 17.1%

Current Ratio 1.4 1.6 1.7 1.6 1.6




THE SEG SaaS INDEX COMPANIES – KEY METRICS

85

Company


2U 7.1x 7.5x 7.1x 6.6x 6.1x - - - - - - 48.8% - - 39.5% -37.1% -32.8% -32.8% -32.3% -27.0%

Amber Road 7.9x 6.4x 6.0x 4.3x 4.1x - - - - - - 21.1% 24.4% 30.2% 30.6% -25.0% -22.3% -50.5% -41.1% -34.7%

Athenahealth 11.8x 8.2x 8.0x 7.1x 6.4x 117.5x 89.3x 86.8x 78.2x 51.9x 35.4% 40.9% 40.1% 36.0% 26.5% 10.0% 9.2% 9.2% 9.1% 12.3%

Bazaarvoice 3.2x 3.0x 3.2x 3.0x 2.9x - - - - - 15.5% 7.4% 14.5% 14.7% 16.9% -23.0% -13.1% -17.7% -17.4% -15.1%

Benefitfocus 15.6x 8.2x 8.1x 5.3x 5.0x - - - - - - 28.2% 29.0% 31.1% 31.8% -17.3% -21.7% -26.0% -30.8% -37.5%

Callidus Software 5.4x 4.2x 4.3x 5.8x 5.3x - - - - - 16.4% 18.3% 19.6% 23.6% 21.6% -10.2% -4.0% -1.7% -0.2% -0.8%

Castlight Health 260.2x 95.9x 52.1x 32.3x 24.6x - - - - - - 212.3% - - 295.4% -579.4% -475.6% -382.4% -295.7% -235.1%

ChannelAdvisors 14.4x 7.3x 4.7x 4.7x 4.3x - - - - - 26.0% 26.9% 28.5% 28.9% 24.8% -8.3% -15.9% -24.4% -30.4% -32.7%

Constant Contact 2.7x 2.7x 2.9x 3.0x 2.7x 31.3x 28.5x 28.1x 26.9x 20.7x 13.7% 13.2% 13.7% 14.4% 16.2% 8.5% 9.4% 10.3% 11.0% 13.3%

Cornerstone OnDemand 17.3x 11.0x 10.1x 8.0x 7.3x - - - - - 60.5% 57.0% 55.7% 48.8% 45.2% -17.5% -16.1% -15.5% -16.6% -15.8%

Covisint 3.3x 2.1x 1.3x 0.6x 0.7x - - - - - 20.6% 13.9% 7.1% 0.4% -6.4% -16.1% -27.6% -34.6% -43.2% -38.3%

Cvent 13.2x 8.9x 7.7x 7.5x 7.0x 238.3x 478.9x 277.8x 161.1x 121.2x - 33.1% 31.9% 29.6% 28.4% 5.6% 1.9% 2.8% 4.6% 5.8%

DealerTrack 4.7x 5.6x 5.5x 4.8x 4.1x 33.8x 46.7x 49.5x 39.1x 31.2x 20.8% 23.8% 30.8% 46.9% 62.6% 14.1% 12.0% 11.1% 12.2% 13.0%

Demandware 23.8x 16.9x 15.1x 14.0x 12.6x - - - - - 31.7% 30.5% 37.5% 44.5% 50.3% -15.8% -15.6% -14.8% -13.7% -11.2%

E2open 9.8x 6.6x 5.5x 2.2x 2.2x - - - - - -6.6% -4.9% -0.5% 9.2% 13.0% -25.4% -29.4% -29.7% -32.4% -33.1%

Ebix 2.8x 3.0x 2.6x 3.0x 3.0x 7.7x 8.0x 7.2x 7.7x 7.6x 9.8% 2.7% -2.2% -3.5% -1.6% 36.8% 37.1% 36.7% 38.5% 39.1%

Ellie Mae 5.4x 5.2x 6.8x 7.8x 7.3x 24.4x 26.8x 41.5x 46.7x 40.3x 41.2% 26.2% 16.1% 10.6% 13.5% 22.1% 19.5% 16.3% 16.7% 18.1%

FireEye 66.0x 30.3x 21.1x 15.6x 12.3x - - - - - - 93.9% 111.5% 132.9% 150.0% -79.3% -88.4% -100.5% -103.6% -99.3%

Fleetmatics 8.0x 5.8x 5.5x 5.9x 5.5x 30.4x 23.0x 23.1x 26.9x 24.0x 38.8% 39.2% 38.3% 35.7% 33.5% 26.2% 25.3% 24.0% 21.9% 22.9%

Halogen Software 4.6x 2.6x 2.5x 2.4x 2.3x - - - - - - 26.3% 22.4% 21.3% 18.9% -8.8% -7.4% -8.9% -11.7% -14.8%

HortonWorks - - - 25.2x 21.4x - - - - - 568.2% - - - - -330.7% -222.1% -219.0% -201.5% -220.8%

HubSpot - - - 12.2x 11.0x - - - - - 80.7% 50.4% - - - -34.4% -42.2% -40.4% -35.7% -33.4%

inContact 3.7x 3.5x 3.9x 3.4x 3.1x - - - - - 22.1% 17.9% 16.4% 19.9% 25.3% -1.0% -2.3% -2.1% -3.2% -4.5%

IntraLinks Holdings 2.6x 2.1x 2.0x 2.5x 2.4x 36.6x 38.7x 43.1x 70.3x 79.4x 8.0% 8.2% 8.1% 8.7% 9.5% 7.1% 5.5% 4.7% 3.6% 3.1%

J2 Global 4.6x 4.3x 4.4x 4.8x 4.6x 11.1x 10.5x 10.4x 11.6x 11.1x 36.8% 40.2% 35.9% 21.0% 17.6% 41.7% 41.3% 42.2% 41.5% 41.8%

Jive Software 3.7x 3.2x 2.6x 2.0x 1.9x - - - - - 34.1% 28.2% 25.2% 23.4% 22.5% -39.2% -41.7% -39.6% -35.3% -29.8%

Liquid Holdings Group - - - - - - - - - - - 137.4% 14.1% -10.9% 1.3% - - - - -

LivePerson 3.7x 2.5x 3.3x 3.5x 3.3x 67.9x 71.8x 93.6x 80.7x 65.7x 14.5% 13.0% 12.3% 13.8% 14.5% 5.4% 3.5% 3.5% 4.3% 5.1%

Marin Software 3.3x 3.0x 2.6x 2.5x 2.2x - - - - - 34.5% 29.8% 30.2% 30.5% 28.5% -39.9% -38.3% -33.2% -30.5% -27.0%

Marketo 17.2x 10.0x 9.7x 9.8x 8.8x - - - - - - 64.2% 64.5% 63.7% 60.5% -42.4% -42.4% -39.1% -34.4% -32.5%

Medical Transcript - - 3.7x 3.3x 2.6x - - 43.3x 51.1x 2182.9x - 4.5% - - 43.2% 7.5% 10.5% 8.6% 6.5% 0.1%

Medidata Solutions 12.1x 7.8x 8.4x 7.6x 6.9x 75.6x 67.7x 94.8x 92.3x 64.0x 26.1% 26.8% 25.5% 24.2% 21.0% 16.0% 11.5% 8.9% 8.2% 10.8%

Netsuite 20.1x 14.2x 14.0x 16.6x 14.2x - - - - - 33.5% 34.2% 34.6% 33.4% 34.2% -8.6% -8.9% -8.8% -8.1% -9.6%

New Relic - - - 18.7x 16.3x - - - - - 154.3% - 113.0% - - -72.8% -77.8% -58.6% -50.2% -44.0%

OPOWER - 10.1x 8.0x 6.2x 5.6x - - - - - - 71.4% 64.2% 54.4% 52.0% -10.9% -13.1% -16.2% -26.7% -27.2%

Paylocity Holding 14.0x 10.4x 9.7x 11.2x 9.5x 555.6x 481.9x 498.7x - - - - - 40.6% 41.2% 2.5% 2.2% 2.0% -1.9% -7.3%

Q2 Holdings 9.0x 7.1x 6.8x 8.0x 6.7x - - - - - - 38.4% - - 39.1% -19.6% -22.9% -26.0% -24.8% -18.9%

TTM Revenue Growth EBITDA Margin

SEG SaaS Index



THE SEG SaaS INDEX COMPANIES – KEY METRICS

86

Company


Qualys 7.5x 6.0x 6.3x 8.7x 7.8x 61.3x 53.9x 56.5x 73.4x 49.1x 18.5% 18.1% 19.3% 20.4% 23.7% 12.3% 11.0% 11.1% 11.8% 15.8%

Rally Software Development 5.8x 3.2x 2.2x 2.3x 2.2x - - - - - 33.5% 30.8% 29.7% 20.2% 17.6% -20.9% -21.1% -24.0% -31.3% -31.8%

RealPage 4.3x 3.9x 3.2x 4.3x 4.2x 27.7x 27.2x 22.9x 39.4x 47.1x 19.4% 17.0% 15.4% 10.4% 7.7% 15.4% 14.4% 14.0% 10.8% 8.9%

RingCentral 8.2x 5.2x 4.6x 3.8x 3.3x - - - - - - 40.1% 38.3% 38.5% 37.0% -16.5% -20.0% -20.2% -20.5% -15.8%

Salesforce.com 10.1x 8.5x 8.2x 8.1x 7.6x - - - 12396.6x 442.4x 32.1% 33.5% 35.7% 37.3% 34.9% -0.5% -1.5% -0.7% 0.1% 1.7%

SciQuest 7.7x 4.9x 3.5x 2.9x 2.9x - - 209.9x 100.8x 48.7x 37.9% 35.8% 30.6% 25.8% 13.0% -1.9% -0.2% 1.7% 2.9% 5.9%

Service-now.com 23.2x 17.1x 17.4x 17.1x 13.6x - - - - - 80.3% 74.2% 69.3% 65.5% 60.7% -9.6% -10.1% -13.1% -15.5% -15.9%

SPS Commerce 9.5x 7.2x 6.9x 6.9x 6.2x 103.3x 76.8x 73.1x 70.5x 61.0x 40.3% 35.4% 29.9% 24.8% 22.6% 9.2% 9.4% 9.5% 9.7% 10.1%

Tableau Software 26.1x 15.5x 14.0x 16.3x 12.1x - 342.1x 241.2x 326.2x 252.7x - 82.0% 86.6% 87.8% 77.5% -1.1% 4.5% 5.8% 5.0% 4.8%

Tangoe 3.7x 2.9x 2.5x 2.3x 2.2x 40.9x 33.0x 31.6x 32.2x 32.2x 30.8% 22.3% 17.7% 14.4% 13.5% 9.0% 8.7% 8.1% 7.2% 7.0%

Textura 17.1x 8.9x 11.8x 9.7x 8.9x - - - - - 63.9% 77.3% - - - -86.0% -50.5% -49.3% -23.0% -19.0%

The Ultimate Software Group 11.0x 8.5x 9.1x 8.9x 8.1x 75.6x 59.6x 62.5x 61.4x 55.4x 24.9% 23.5% 23.2% 23.7% 23.3% 14.6% 14.3% 14.6% 14.5% 14.5%

TrueCar - 6.6x 7.5x 8.1x 7.3x - - - - - - 67.7% - - 66.1% -16.1% -13.1% -12.3% -17.6% -20.9%

Upland Software - - - 3.4x 3.1x - - - 70.1x - - 81.0% - - - 4.3% 5.9% 5.7% 4.9% -14.4%

Veeva Systems 20.1x 11.4x 12.0x 12.6x 11.4x 96.9x 59.1x 61.3x 62.1x 52.1x - 62.2% 58.3% 54.9% 54.4% 20.7% 19.4% 19.5% 20.4% 21.8%

Workday 39.0x 27.8x 27.0x 23.4x 20.5x - - - - - 73.6% 71.4% 74.1% 74.4% 72.2% -26.0% -25.3% -24.6% -25.2% -22.7%

Workiva - - - 5.4x 5.0x - - - - - - 60.9% - - - -51.0% -29.8% -25.4% -23.9% -27.2%

Yodlee - - - 5.7x 5.1x - - - 82.0x - 6.2% 21.4% - - 27.0% -5.7% 4.6% 6.2% 7.0% -1.9%

Zendesk - 16.3x 17.5x 16.9x 14.7x - - - - - - 88.5% - - - -60.3% -26.2% -26.6% -38.2% -44.1%

Zix 5.3x 3.7x 3.9x 3.5x 3.5x 28.6x 16.7x 16.0x 15.0x 17.1x 14.4% 11.0% 8.3% 6.5% 4.8% 18.5% 22.4% 24.5% 23.5% 20.4%

TTM Revenue Growth EBITDA Margin

SEG SaaS Index



THE SEG SaaS INDEX METRICS BY PRODUCT CATEGORY

87

CRM & Marketing 4Q13 1Q14 2Q14 3Q14 4Q14


EV/EBITDA 67.9x 71.8x 93.6x 120.9x 93.4x



EBITDA Margin -23.0% -13.1% -17.7% -17.4% -15.1%

Net Income Margin -36.4% -31.3% -33.0% -33.0% -29.5%


TTM EBITDA Growth (YoY) -34.5% -16.9% -29.6% 0.4% 8.5%

TTM Earnings Growth (YoY) -64.8% -42.6% -25.5% 16.5% 41.6%

Current Ratio 2.6 2.3 2.3 2.1 2.0



ERP & Supply Chain 4Q13 1Q14 2Q14 3Q14 4Q14


EV/EBITDA 66.8x 49.9x 73.1x 70.5x 61.8x



EBITDA Margin -8.6% -8.9% -8.8% -8.1% -8.7%



TTM EBITDA Growth (YoY) -57.3% -76.2% -34.0% -16.9% -35.7%


Current Ratio 3.0 2.1 2.1 2.1 2.1



Vertically Focused 4Q13 1Q14 2Q14 3Q14 4Q14


EV/EBITDA 33.8x 46.7x 46.4x 48.9x 49.6x



EBITDA Margin 10.9% 10.5% 8.9% 8.2% 7.9%

Net Income Margin -0.9% 0.4% -1.1% -1.7% -2.1%




Current Ratio 1.6 1.5 1.8 2.3 2.7



Workforce Management 4Q13 1Q14 2Q14 3Q14 4Q14

EV/Revenue 14.0x 8.5x 9.1x 8.0x 7.3x

EV/EBITDA 315.6x 270.8x 280.6x 61.4x 59.4x



EBITDA Margin -10.2% -7.4% -8.9% -11.7% -14.8%



TTM EBITDA Growth (YoY) 5.0% 8.5% -10.3% -39.6% -50.5%


Current Ratio 2.3 2.0 2.0 1.7 1.6



Other SaaS 4Q13 1Q14 2Q14 3Q14 4Q14


EV/EBITDA 38.7x 38.7x 43.1x 70.3x 62.4x



EBITDA Margin -12.7% -15.8% -17.5% -18.0% -17.8%



TTM EBITDA Growth (YoY) -35.0% -40.1% -41.8% -52.3% -67.5%

TTM Earnings Growth (YoY) 156.0% 25.9% -8.9% -15.8% -3.1%

Current Ratio 2.8 2.4 3.0 2.7 2.9




THE SEG INTERNET INDEX COMPANIES – KEY METRICS

88

Company


1-800-FLOWERS.COM 0.5x 0.5x 0.5x 0.8x 0.6x 7.6x 7.8x 9.1x 12.7x 5.8x 4.5% 4.5% 1.2% 2.8% 36.3% 6.2% 6.2% 5.2% 5.9% 9.6%

58.com 25.8x 21.5x 23.5x 15.1x 13.2x 502.4x 162.5x 151.8x 104.6x 123.2x - 67.3% 86.4% 86.7% 83.8% 5.1% 13.2% 15.5% 14.5% 10.7%

8x8 6.7x 4.9x 4.1x 3.7x 3.3x 53.4x 60.0x 61.9x 79.3x 55.4x 17.8% 20.4% 23.9% 27.3% 28.2% 12.5% 8.2% 6.6% 4.6% 5.9%

Akamai Technologies 6.4x 6.0x 6.4x 6.1x 5.5x 17.9x 16.9x 18.0x 17.3x 14.5x 15.2% 14.8% 16.9% 19.9% 24.5% 35.7% 35.3% 35.5% 35.1% 37.6%

Alibaba - - 26.2x 27.7x 22.5x - - 49.5x 53.7x 53.5x 72.4% - 52.1% - 44.1% 44.3% 54.1% 53.0% 51.6% 41.9%

Amazon.com 2.3x 1.9x 1.9x 1.7x 1.6x 51.4x 39.3x 39.1x 34.8x 31.9x 22.5% 21.9% 22.1% 22.3% 19.5% 4.5% 4.8% 4.9% 4.9% 4.9%

Angie's List 3.6x 2.6x 1.6x 1.3x 1.2x - - - - - 62.7% 57.7% 50.5% 43.2% 35.2% -13.2% -9.8% -7.3% -8.2% -4.9%

AOL 1.5x 1.3x 1.5x 1.5x 1.4x 10.6x 7.0x 7.9x 8.0x 8.1x 3.3% 5.8% 7.5% 9.9% 11.4% 14.5% 18.8% 18.4% 18.2% 17.4%

Baidu.com 11.8x 10.1x 12.6x 12.0x 10.6x 26.3x 23.2x 31.2x 31.2x 29.3x 40.7% 43.2% 47.7% 52.8% 54.8% 45.0% 43.3% 40.5% 38.4% 36.2%

Bankrate 4.2x 3.9x 3.5x 2.6x 2.5x 19.4x 16.4x 14.8x 11.1x 11.0x -10.3% 0.1% 10.2% 20.4% 24.0% 21.8% 23.8% 23.6% 23.2% 22.5%

Bitauto Holdings 6.3x 6.0x 12.0x 10.7x 9.4x 32.8x 29.9x 57.2x 45.6x 38.2x 41.0% 36.2% 38.9% 43.7% 50.1% 19.2% 20.0% 21.0% 23.5% 24.5%

BlueNile 0.8x 0.7x 0.6x 0.8x 0.8x 21.8x 19.8x 17.6x 22.6x 22.6x 12.5% 12.5% 10.3% 5.0% 5.0% 3.5% 3.5% 3.6% 3.6% 3.6%

Borderfree 5.1x 3.5x 3.0x 1.6x 1.5x - 326.8x 310.5x 150.2x 111.5x - 35.7% 20.6% 17.4% 20.4% -0.4% 1.1% 1.0% 1.1% 1.4%

Brightcove 2.7x 2.4x 1.5x 1.5x 1.5x - - - - - 27.2% 24.9% 25.4% 22.8% 13.8% -5.6% -1.7% -0.9% -1.0% -2.8%

BroadSoft 4.3x 3.5x 3.3x 3.8x 3.6x 110.6x 487.1x - 727.4x 84.6x 8.0% 8.3% 10.0% 12.8% 17.8% 3.9% 0.7% -1.7% 0.5% 4.2%

Carbonite 2.1x 2.0x 2.0x 2.0x 1.9x - 89.0x 25.1x 28.3x 40.6x 31.4% 27.5% 24.2% 20.8% 14.4% -0.3% 2.2% 7.8% 7.2% 4.7%

Care.com 8.7x 3.4x 2.0x 1.6x 1.6x - - - - - 68.0% 68.0% - 41.1% 41.1% -25.0% -25.0% -30.2% -31.2% -31.2%

ChangYou.com 2.0x 1.7x 1.6x 1.7x 1.6x 3.3x 3.6x 5.2x 10.1x 23.4x 18.7% 18.4% 11.6% 5.3% 2.4% 58.7% 47.6% 29.8% 16.5% 7.0%

Chegg 1.9x 1.5x 1.8x 1.7x 1.6x 10.8x 13.5x 20.2x 26.7x 31.4x - 19.8% 19.1% 16.8% 20.6% 18.0% 10.8% 8.8% 6.3% 5.0%

Cimpress 1.5x 1.2x 1.6x 2.0x 1.9x 15.8x 11.1x 14.7x 15.7x 12.7x 12.4% 9.6% 6.5% 8.8% 15.2% 9.7% 11.2% 10.9% 13.0% 14.6%

Coupons.com 12.9x 9.0x 5.3x 5.2x 4.6x - - - - - - 49.7% - - 32.1% -9.5% -2.1% -4.9% -6.6% -5.2%

Criteo SA 3.7x 2.6x 2.2x 2.5x 2.4x 107.4x 51.5x 36.1x 33.5x 32.0x - 63.3% 61.7% 60.8% 64.2% 3.5% 5.1% 6.2% 7.5% 7.4%

Ctrip 6.4x 7.6x 8.8x 7.3x 6.6x 36.9x 42.6x 58.9x 59.6x 80.2x 26.7% 29.5% 31.7% 34.3% 36.2% 17.4% 17.8% 15.0% 12.3% 8.3%

DangDang 0.6x 0.7x 0.8x 0.6x 0.5x - - - 100.3x 40.3x 24.1% 21.8% 23.6% 25.6% 28.5% -5.0% -2.3% -0.8% 0.6% 1.3%

DemandMedia 1.6x 0.8x 0.3x 0.2x 0.2x 8.0x 7.2x 3.7x 2.2x 2.4x -27.8% 3.7% -2.8% 21.6% 40.0% 19.7% 11.4% 8.3% 8.6% 8.0%

Digital River 0.8x 0.6x 0.6x 1.4x 1.4x 14.5x 7.7x 7.6x 15.5x 14.9x 0.6% 5.2% -0.7% -3.3% -2.9% 5.2% 8.3% 7.9% 9.2% 9.5%

eBay 4.2x 3.8x 3.8x 3.8x 3.6x 14.4x 12.9x 12.9x 13.1x 12.9x 15.2% 14.0% 13.9% 13.5% 11.6% 29.5% 29.7% 29.6% 29.2% 28.1%

eHealth 5.1x 3.4x 2.1x 2.0x 2.0x 46.6x 52.9x 90.6x 43.7x 31.6x 11.1% 15.2% 15.7% 14.4% 10.9% 10.9% 6.5% 2.3% 4.6% 6.4%

Envivio 1.2x 0.6x 0.2x 0.0x 0.0x - - - - - -18.1% 10.5% 33.2% 29.9% 7.5% -31.5% -20.8% -19.8% -23.4% -28.8%

Everyday Health 3.3x 4.1x 3.0x 2.3x 2.2x 58.2x 61.2x 35.5x 26.2x 25.2x - 12.5% 17.1% - 23.2% 5.6% 6.8% 8.5% 8.9% 8.8%

Expedia 2.1x 2.0x 2.1x 2.0x 1.8x 15.2x 14.6x 15.8x 14.4x 14.4x 19.6% 18.4% 17.3% 19.5% 20.8% 14.0% 13.4% 13.2% 14.0% 12.8%

Facebook 22.2x 18.4x 20.2x 19.7x 15.8x 46.7x 36.9x 38.8x 36.4x 31.7x 48.2% 54.7% 62.4% 63.7% 58.4% 47.5% 49.9% 52.1% 54.2% 49.9%

GeekNet 0.6x 0.3x 0.2x 0.2x 0.2x 28.1x 39.7x 51.5x - - 21.3% 16.3% 16.9% 14.1% 9.5% 2.0% 0.8% 0.4% -1.2% -2.0%

Giant Interactive - 103.1x 53.1x 16.2x 10.8x - - - - - - - - - - - -576.9% - - -

Google 6.3x 5.4x 5.6x 4.9x 4.8x 18.6x 17.8x 18.6x 16.3x 14.7x 17.0% 19.2% 18.7% 21.1% 10.3% 34.0% 30.1% 29.8% 29.8% 32.5%

Groupon 2.4x 1.3x 1.3x 1.4x 1.3x 46.7x 23.5x 29.2x 43.1x 44.6x 11.7% 10.2% 14.9% 18.9% 24.2% 5.1% 5.4% 4.3% 3.3% 3.0%

GrubHub - 18.4x 15.8x 12.9x 10.3x - 84.4x 68.6x 59.2x 38.8x - 66.6% - - 85.1% 20.3% 21.8% 23.0% 21.8% 26.7%


SEG Internet Index



89

Company


Harmonic 1.1x 1.1x 1.0x 1.1x 1.2x 21.4x 17.8x 17.4x 21.5x 27.2x -8.5% 1.3% 0.8% -3.0% -6.1% 4.9% 6.5% 5.6% 5.2% 4.3%

HomeAway 10.5x 7.5x 7.1x 6.1x 5.7x 58.6x 43.8x 44.0x 37.5x 37.8x 22.6% 23.6% 26.0% 28.8% 30.4% 18.0% 17.1% 16.1% 16.3% 15.2%

Interactive Intelligence 4.7x 3.2x 2.6x 2.7x 2.6x 58.4x 35.9x 40.1x 82.8x 2066.6x 32.7% 34.1% 25.8% 17.4% 7.2% 8.1% 8.9% 6.4% 3.3% 0.1%

InterActiveCorp 1.9x 1.9x 1.9x 1.8x 1.7x 11.0x 10.4x 10.6x 10.4x 10.7x 16.4% 7.9% 4.1% -1.4% 2.9% 17.6% 18.0% 17.5% 17.3% 16.0%

LendingClub - - - - - - - - - - - 189.9% 168.6% 150.5% 130.6% - - - - -

LifeLock 4.7x 2.8x 2.8x 3.1x 2.9x 78.2x 32.9x 39.2x 47.3x 41.7x 38.2% 33.7% 31.3% 30.6% 29.6% 6.0% 8.4% 7.1% 6.6% 7.1%

Limelight Networks 0.5x 0.6x 0.8x 1.0x 1.0x - - - - - -1.1% -3.8% -7.1% -7.0% -6.4% -5.0% -5.9% -7.0% -5.6% -4.0%

LinkedIn 16.1x 11.5x 13.8x 13.4x 11.2x 132.9x 105.7x 139.5x 126.5x 90.9x 65.6% 57.2% 51.3% 48.5% 45.2% 12.1% 10.9% 9.9% 10.6% 12.3%

Liquidity Services 1.4x 0.8x 0.7x 0.6x 0.6x 7.6x 4.6x 5.0x 4.4x 6.0x 6.4% 2.9% 1.5% 1.5% -1.3% 18.0% 17.4% 15.0% 13.1% 9.7%

Mail.ru Group 10.1x 7.5x 6.6x 4.7x 4.7x 23.7x 17.2x 14.9x 10.3x 10.3x 30.7% 29.4% 26.8% 24.5% 24.5% 42.4% 43.2% 44.4% 45.5% 45.5%

MakeMyTrip 3.6x 4.0x 4.4x 4.0x 3.7x - - - - - 15.7% 13.2% 11.6% 12.9% 16.9% -9.3% -7.8% -5.1% -3.5% -2.8%

Marchex 2.3x 2.7x 1.9x 0.5x 0.5x 93.3x 65.7x 40.6x 9.0x 8.7x 4.3% 14.9% 27.5% 30.3% 30.1% 2.4% 4.1% 4.6% 5.4% 5.3%

Mecox Lane 0.3x 0.4x 0.5x 0.5x 0.5x - - - - - -45.3% -42.4% -36.9% -36.6% -16.7% -11.6% -21.3% -15.4% -7.0% -12.6%

Mercadolibre 9.2x 7.7x 9.5x 11.1x 10.6x 26.8x 22.0x 27.0x 30.9x 29.1x 24.0% 26.5% 23.6% 21.4% 19.9% 34.3% 32.2% 35.4% 35.9% 36.3%

Mitel Networks 1.9x 2.4x 1.9x 1.5x 1.3x 12.3x 20.1x 16.4x 13.6x 11.9x -2.1% - - - - 15.3% 11.9% 11.6% 11.3% 10.9%

MOL Global - - - 8.1x 8.6x - - - 33.9x 38.1x 51.2% 79.5% - - - 17.8% 25.3% 24.7% 23.9% 22.5%

Monster Worldwide 1.0x 0.9x 0.9x 0.7x 0.7x 6.8x 6.5x 6.8x 6.6x 10.8x -10.0% -9.3% -8.6% -6.6% -4.7% 14.7% 13.9% 12.6% 10.9% 6.8%

NCSoft 4.4x 4.4x 3.1x 2.9x 2.9x 12.5x 13.8x 10.2x 9.8x 8.4x 36.3% 0.4% -5.9% -8.4% - 34.7% 31.8% 30.7% 30.1% 34.8%

Netease 4.4x 4.2x 5.4x 6.0x 5.1x 9.1x 8.5x 11.1x 12.7x 12.0x 12.6% 12.1% 12.2% 14.1% 27.4% 48.7% 49.1% 48.5% 47.0% 42.2%

Netflix 5.7x 4.8x 5.7x 4.4x 3.9x 111.2x 76.2x 76.8x 51.1x 46.6x 17.1% 21.2% 22.8% 24.0% 25.8% 5.1% 6.3% 7.4% 8.5% 8.3%

Orbitz 1.4x 1.3x 1.3x 1.2x 1.2x 9.1x 9.5x 8.9x 8.2x 8.5x 9.5% 8.8% 7.9% 7.3% 8.3% 15.2% 13.7% 14.9% 14.9% 14.0%

Overstock.com 0.3x 0.2x 0.2x 0.3x 0.3x 11.9x 11.8x 15.1x 25.3x 15.8x 16.6% 18.6% 16.1% 14.2% 14.8% 2.4% 1.7% 1.6% 1.3% 2.0%

Pandora 10.9x 7.5x 7.0x 4.6x 4.0x - - - - - 53.5% 54.1% - - 40.6% -7.1% -2.8% -1.0% -1.4% -1.6%

Perfect World 1.4x 1.0x 1.4x 1.3x 1.2x 6.2x 4.8x 6.7x 6.1x 6.6x -1.1% 10.2% 24.5% 30.9% 30.4% 22.5% 20.9% 20.5% 21.0% 18.3%

PetMed Express 1.0x 1.0x 1.0x 1.0x 1.0x 7.7x 7.8x 8.2x 7.6x 7.6x 0.8% 1.4% 2.4% -0.6% -3.3% 12.5% 12.4% 12.5% 12.7% 12.9%

Polycom 1.1x 1.1x 1.1x 1.1x 1.1x 13.7x 12.4x 11.2x 10.5x 9.0x -3.7% -1.7% -2.0% -2.0% -1.7% 8.0% 8.7% 9.7% 10.4% 12.1%

Priceline 9.0x 8.6x 8.4x 7.4x 6.9x 23.9x 22.8x 22.3x 19.4x 17.7x 27.3% 29.1% 29.1% 28.9% 26.4% 37.8% 37.6% 37.6% 38.2% 38.9%

Qihoo 21.1x 16.0x 13.4x 8.5x 7.1x 79.8x 52.3x 44.8x 31.8x 28.8x 91.5% 104.0% 123.6% 121.3% 113.8% 26.4% 30.6% 29.8% 26.6% 24.7%

QuinStreet 0.9x 0.7x 0.6x 0.5x 0.6x 8.4x 7.9x 8.0x 13.8x - -12.8% -9.5% -7.7% -7.4% -7.6% 10.2% 9.0% 7.3% 3.9% -0.6%

ReachLocal 0.5x 0.2x 0.2x 0.1x 0.1x 11.8x 9.7x 21.9x - - 15.2% 13.0% 9.4% 5.5% -0.4% 3.8% 2.6% 0.9% -1.5% -4.2%

Renren 2.0x 1.5x 1.4x 2.1x 2.7x - - - - - 6.0% -1.8% -17.1% -40.9% -46.4% -39.6% -58.4% -71.0% -81.4% -103.9%

Rocket Fuel 9.2x 3.5x 1.5x 1.7x 1.5x - - - - - - 125.7% 115.9% 97.4% 81.8% -7.7% -4.3% -4.8% -5.5% -8.3%

Rovi 6.7x 5.5x 5.3x 4.9x 4.9x 28.2x 16.3x 15.1x 14.0x 13.5x -35.3% 2.3% 11.9% 19.8% 32.4% 23.8% 33.7% 35.0% 35.1% 36.0%

SeaChange International 1.7x 1.3x 1.0x 0.9x 1.0x 17.1x 22.5x 700.1x - - -0.4% -6.9% -13.5% -18.6% -22.9% 10.0% 5.6% 0.1% -5.0% -10.1%

ShoreTel 1.5x 1.1x 1.1x 1.2x 1.2x 733.9x 36.5x 24.1x 21.7x 17.9x 20.6% 17.0% 9.9% 8.4% 5.9% 0.2% 3.1% 4.4% 5.6% 6.6%

Shutterfly 2.3x 1.8x 2.3x 2.0x 1.9x 20.9x 16.5x 23.5x 19.9x 22.2x 31.1% 22.3% 20.7% 18.4% 17.2% 10.9% 11.0% 9.8% 9.9% 8.6%

Shutterstock 12.4x 9.7x 9.5x 8.3x 7.6x 60.3x 48.6x 52.2x 50.6x 50.6x 39.6% 38.9% 40.4% 40.8% 40.7% 20.6% 20.0% 18.2% 16.4% 15.1%


SEG Internet Index



90

Company


SINA 6.5x 3.9x 2.8x 1.8x 1.7x 109.0x 44.9x 33.6x 19.0x 36.2x 16.0% 25.7% 29.4% 28.7% 24.2% 6.0% 8.7% 8.5% 9.3% 4.8%

Sohu.com 1.8x 1.3x 1.2x 1.1x 1.0x 6.4x 5.7x 9.1x 17.2x 28.1x 29.6% 31.2% 27.0% 23.4% 19.5% 28.0% 22.4% 13.4% 6.3% 3.5%

Sonus Networks 2.4x 2.4x 2.8x 2.7x 2.7x - 95.0x 176.1x 347.1x 347.1x 8.9% 12.3% 9.8% 7.2% 7.2% -3.2% 2.5% 1.6% 0.8% 0.8%

Stamps.com 4.2x 3.6x 3.6x 5.3x 5.1x 15.4x 12.4x 12.9x 19.2x 17.9x 11.3% 10.5% 8.0% 6.4% 9.8% 27.3% 28.7% 28.3% 27.7% 28.3%

Synacor 0.3x 0.3x 0.3x 0.2x 0.2x 7.7x 8.3x 24.9x - - -3.5% -8.3% -10.4% -9.4% -8.3% 4.3% 3.5% 1.2% -0.9% -2.3%

Tencent Holdings 13.8x 12.6x 14.0x 12.3x 11.4x 39.2x 36.7x 41.2x 34.7x 30.6x 40.2% 37.7% 36.6% 36.8% 34.7% 35.3% 34.2% 33.9% 35.4% 37.3%

The Rubicon Project - 5.9x 3.5x 3.7x 3.3x - 267.8x - - - - 46.9% - - 48.5% 2.8% 2.2% -3.1% -8.1% -9.1%

TheStreet.com 0.8x 0.6x 0.4x 0.4x 0.4x - - - - 75.7x 4.5% 7.4% 11.4% 11.7% 9.5% -3.5% -0.7% -0.5% -0.2% 0.5%

Travelzoo 1.7x 1.4x 1.2x 0.9x 0.9x 10.2x 8.0x 7.4x 5.2x 8.1x 5.7% 4.7% 1.5% -2.7% -10.2% 17.0% 17.2% 16.8% 16.5% 11.5%

Tree.Com 2.2x 1.6x 1.6x 2.6x 2.5x 40.6x 21.8x 23.6x 33.2x 33.6x 97.6% 79.8% 63.8% 38.3% 26.1% 5.3% 7.1% 6.7% 7.8% 7.5%

Tremor 1.0x 0.9x 0.5x 0.4x 0.3x - - - - - - 25.3% 25.9% 22.1% 20.2% -1.9% -5.5% -6.5% -9.5% -11.2%

TripAdvisor 14.1x 13.2x 13.8x 9.9x 9.1x 38.9x 40.1x 42.8x 31.9x 31.4x 23.2% 23.8% 23.0% 24.7% 29.9% 36.3% 32.9% 32.3% 31.0% 28.9%

Trulia 10.7x 9.1x 12.1x 8.4x 7.5x - - - - - 93.3% 111.1% 118.0% 124.7% 105.5% -2.6% -7.1% -10.4% -12.6% -9.8%

TubeMogul - - 4.4x 5.2x 4.4x - - - - 219.2x - 67.5% - - 104.6% -14.0% -10.4% -6.5% -0.8% 2.0%

Tucows 1.1x 1.1x 1.2x 1.3x 1.2x 17.8x 17.2x 17.2x 15.6x 14.8x 13.7% 13.3% 14.7% 15.5% 12.2% 6.2% 6.6% 7.2% 8.0% 8.3%

Twitter 55.1x 31.4x 31.8x 23.6x 16.4x - - - - - - 109.8% 112.5% 117.3% 111.0% -7.7% -80.0% -76.9% -73.1% -23.6%

VeriSign 7.4x 6.5x 6.9x 7.1x 6.9x 11.9x 10.6x 11.3x 11.5x 11.1x 12.1% 10.5% 8.1% 6.3% 4.7% 62.5% 61.0% 61.0% 61.5% 62.2%

WebMD Health 3.6x 3.5x 3.8x 2.9x 2.8x 29.3x 24.3x 23.2x 16.1x 14.9x 2.9% 9.7% 12.8% 12.9% 12.4% 12.2% 14.3% 16.2% 18.0% 19.1%

Wix.com 14.2x 7.2x 5.9x 6.1x 5.3x - - - - - - 84.2% 88.5% 85.3% 81.9% -28.5% -31.8% -37.2% -40.0% -39.7%

XO Group 1.8x 1.7x 1.8x 2.2x 2.1x 11.2x 12.8x 15.1x 20.5x 21.1x 4.3% 3.6% 4.9% 4.7% 4.3% 16.3% 13.2% 11.7% 10.6% 10.2%

Xoom 7.0x 5.2x 5.0x 3.0x 2.6x 90.1x 56.2x 55.7x 45.8x - 52.9% 52.7% 53.1% 40.4% 30.2% 7.7% 9.3% 8.9% 6.5% -13.4%

Xunlei - 3.8x 2.7x 0.8x 0.8x - 14.2x 11.1x 4.2x 7.6x 71.6% 24.2% - - - 37.0% 26.9% 24.3% 19.8% 10.8%

Yahoo! 7.7x 7.1x 7.6x 8.2x 8.2x 31.1x 32.3x 40.1x 48.9x 44.8x -4.1% -6.1% -4.7% -4.2% -1.3% 24.7% 22.0% 19.0% 16.7% 18.3%

Yandex 10.4x 8.0x 7.9x 6.2x 6.8x 24.4x 19.6x 20.2x 16.3x 17.5x 37.3% 37.3% 37.2% 36.2% 33.0% 42.7% 40.7% 39.0% 37.8% 38.6%

Yelp 27.6x 18.2x 18.9x 13.0x 10.2x - 4669.3x 3640.6x 594.9x 134.3x 67.7% 69.4% 68.4% 66.2% 62.0% -0.3% 0.4% 0.5% 2.2% 7.6%

Youku 10.2x 7.2x 6.5x 4.0x 3.7x 189.3x 71.6x 55.9x 36.4x 34.8x 88.1% 68.7% 57.4% 42.0% 32.7% 5.4% 10.0% 11.7% 11.0% 10.6%

YuMe 1.2x 1.0x 0.7x 0.6x 0.6x 24.9x 33.1x 45.1x 84.2x - - 29.5% 31.2% 26.8% 22.6% 4.8% 2.9% 1.6% 0.8% -0.5%

YY 14.4x 10.8x 11.6x 9.1x 7.5x 58.8x 37.6x 37.6x 28.5x 23.4x 121.9% 122.4% 117.8% 113.7% 111.1% 24.5% 28.8% 30.8% 31.9% 32.0%

Zillow 17.2x 19.9x 22.5x 15.7x 13.8x - - - - - 69.5% 69.1% 69.1% 68.6% 68.2% -5.3% -2.8% -2.9% -1.9% -0.3%

Zynga - - - - - - - - - - -21.3% -31.8% -36.5% -37.6% -33.1% 13.9% 8.4% 4.2% -2.5% -11.7%


SEG Internet Index


THE SEG INTERNET INDEX METRICS BY PRODUCT CATEGORY

91

Infrastructure 4Q13 1Q14 2Q14 3Q14 4Q14


EV/EBITDA 17.9x 17.8x 17.7x 17.3x 16.4x



EBITDA Margin 5.7% 6.5% 6.0% 4.9% 4.7%





Current Ratio 3.2 2.7 2.4 2.4 2.3



Search 4Q13 1Q14 2Q14 3Q14 4Q14


EV/EBITDA 21.5x 18.7x 19.4x 16.3x 16.7x



EBITDA Margin 38.4% 35.4% 34.4% 33.8% 32.8%





Current Ratio 3.8 4.2 4.2 4.1 3.2



Services 4Q13 1Q14 2Q14 3Q14 4Q14


EV/EBITDA 40.6x 32.9x 25.1x 28.3x 28.8x



EBITDA Margin 6.0% 7.1% 7.3% 6.6% 7.1%




TTM Earnings Growth (YoY) -9.3% -14.8% 159.9% 401.6% 91.1%

Current Ratio 1.7 2.2 3.0 2.6 3.0



Social 4Q13 1Q14 2Q14 3Q14 4Q14

EV/Revenue 16.1x 11.5x 13.8x 13.0x 11.4x

EV/EBITDA 52.8x 37.6x 38.8x 36.4x 32.6x



EBITDA Margin 12.1% 10.9% 9.9% 10.6% 11.2%





Current Ratio 4.6 9.7 9.6 6.7 9.4


Enterprise Value Growth (YoY) n/a n/a n/a 22.1% -9.9%

Ad Tech 4Q13 1Q14 2Q14 3Q14 4Q14


EV/EBITDA 24.7x 23.2x 26.5x 17.2x 29.3x



EBITDA Margin 4.3% 4.6% 5.4% 5.8% 3.7%

Net Income Margin 0.0% 0.2% -0.1% 0.2% -1.7%


TTM EBITDA Growth (YoY) 4.7% 5.6% -0.9% -4.5% -20.2%


Current Ratio 2.6 3.0 3.1 3.4 2.6



Commerce 4Q13 1Q14 2Q14 3Q14 4Q14


EV/EBITDA 15.4x 16.7x 20.2x 28.8x 30.3x



EBITDA Margin 5.7% 9.6% 8.4% 7.7% 7.7%





Current Ratio 1.5 1.8 1.7 1.7 1.6



Content & Media 4Q13 1Q14 2Q14 3Q14 4Q14


EV/EBITDA 30.2x 24.3x 23.2x 19.0x 28.0x



EBITDA Margin 14.5% 13.2% 11.7% 11.0% 10.6%




TTM Earnings Growth (YoY) 47.2% 4.3% -47.7% -42.2% 68.9%

Current Ratio 2.8 2.6 3.2 3.4 3.5



Gaming 4Q13 1Q14 2Q14 3Q14 4Q14


EV/EBITDA 9.1x 8.5x 10.2x 11.4x 21.5x



EBITDA Margin 34.7% 27.1% 29.8% 21.0% 18.3%





Current Ratio 2.0 1.9 2.0 1.8 2.5



Travel 4Q13 1Q14 2Q14 3Q14 4Q14


EV/EBITDA 19.5x 18.5x 19.1x 16.9x 15.5x



EBITDA Margin 17.0% 17.1% 15.0% 14.9% 14.3%





Current Ratio 1.6 1.5 1.5 1.7 1.6




SELECT PUBLIC SELLERS

Buyer Seller

Purchase

Price (mm)

Enterprise

Value (mm) EV/Rev EV/EBITDA

TTM Rev

Growth

SAP America, Inc. Concur Technologies, Inc. (NasdaqGS:CNQR) $8,468.0 $7,651.6 11.5x 235.8x 31.8%

Oracle Corporation (NYSE:ORCL) MICROS Systems, Inc. (NasdaqGS:MCRS) $5,262.5 $4,604.1 3.4x 17.5x 7.7%

Zillow, Inc. (NasdaqGS:Z) Trulia, Inc. (NYSE:TRLA) $3,305.4 $3,090.5 14.8x - 124.7%

The Priceline Group Inc. (NasdaqGS:PCLN) OpenTable, Inc. (NasdaqGS:OPEN) $2,613.1 $2,495.5 12.6x 41.5x 18.2%

Thoma Bravo, LLC Compuware Corporation (NasdaqGS:CPWR) $2,366.4 $2,090.9 2.9x 24.5x 5.4%

Alibaba Group Holding Limited AutoNavi Holdings Limited (NasdaqGS:AMAP) $1,236.2 $1,167.7 8.2x - -

Vista Equity Partners; Vista Equity Associates V, LLC Advanced Computer Software Group plc (AIM:ASW) $1,140.0 $1,114.2 3.3x 23.6x 30.0%

P2 Capital Partners, LLC Epiq Systems, Inc. (NasdaqGS:EPIQ) $993.4 $1,003.4 2.2x 16.4x 21.7%

Apax Partners LLP Exact Holding NV (ENXTAM:EXACT) $932.3 $860.5 3.2x 16.2x 9.1%

Dassault Systemes SA (ENXTPA:DSY) Accelrys Inc. (NasdaqGS:ACCL) $746.4 $682.9 4.1x 101.4x -

Siris Capital Group, LLC Digital River Inc. (NasdaqGS:DRIV) $1,031.7 $645.8 1.7x 18.1x -2.9%

Tuition Build Inc. Limelight Networks, Inc. (NasdaqGS:LLNW) $660.5 $548.1 3.3x - -7.1%

j2 Global, Inc. (NasdaqGS:JCOM) Carbonite, Inc. (NasdaqGM:CARB) $366.4 $333.1 2.8x 37.3x 17.1%

Nordic Capital Vizrt Ltd. (OB:VIZ) $368.9 $318.3 2.3x 11.2x 17.3%

Open Text Corporation (NasdaqGS:OTEX) Actuate Corporation (NasdaqGS:BIRT) $306.9 $248.5 2.3x - -22.1%

Dealertrack Technologies, Inc. (NasdaqGS:TRAK) Incadea Plc (AIM:INCA) $208.5 $202.5 3.7x 54.7x 50.0%

Hyland Software UK Ltd ReadSoft AB (OM:RSOF B) $197.0 $183.9 1.6x 30.1x 2.2%

Omnitracs, LLC XRS Corporation (NasdaqCM:XRSC) $190.6 $177.5 3.4x 28.9x -7.1%

Hgcapital Mercury A L.P; HgCapital Mercury Executive Allocate Software plc. (AIM:ALL) $167.1 $145.3 2.3x 15.3x 8.1%

WABCO Europe BVBA Transics International NV (ENXTBR:TRAN) $136.4 $115.3 1.6x 7.2x -

EnerNOC, Inc. (NasdaqGS:ENOC) World Energy Solutions, Inc. (NasdaqCM:XWES) $79.9 $77.2 2.0x 22.5x 7.6%

3D Systems Corporation (NYSE:DDD) Cimatron Ltd. (NasdaqCM:CIMT) $96.5 $76.4 1.6x 10.6x 6.3%

SintecMedia Ltd.; Sintec Media Software Ltd. Pilat Media Global plc (AIM:PGB) $80.7 $72.1 1.6x 12.4x 9.1%

Yahoo Japan Corporation (TSE:4689) Synergy Marketing, Inc. (JASDAQ:3859) $91.1 $66.2 1.7x 12.0x 8.8%

Aurea Software FZ-LLC Update Software AG (XTRA:UP2) $53.7 $34.6 0.8x - 3.5%

Medina Capital Cryptzone Group AB (publ) (OM:CZON B) $13.4 $13.4 3.6x - -

92


SELECT MEGA DEALS

Buyer Seller

Purchase

Price (mm)

Enterprise


TTM Rev

Growth

Facebook, Inc. (NasdaqGS:FB) WhatsApp Inc. $16,374.2 $16,374.2 - - -

SAP America, Inc. Concur Technologies, Inc. (NasdaqGS:CNQR) $8,468.0 $7,651.6 11.5x 235.8x 31.8%

Oracle Corporation (NYSE:ORCL) MICROS Systems, Inc. (NasdaqGS:MCRS) $5,262.5 $4,604.1 3.4x 17.5x 7.7%

Zillow, Inc. (NasdaqGS:Z) Trulia, Inc. (NYSE:TRLA) $3,305.4 $3,090.5 14.8x - 124.7%

Cognizant Technology Solutions Corporation (NasdaqGS:CTSH) TriZetto Corporation $2,700.0 $2,700.0 3.8x - -

Microsoft Corporation (NasdaqGS:MSFT) Mojang AB $2,500.0 $2,500.0 - - -

The Priceline Group Inc. (NasdaqGS:PCLN) OpenTable, Inc. (NasdaqGS:OPEN) $2,613.1 $2,495.5 12.6x 41.5x 18.2%

Gannett Co., Inc. (NYSE:GCI) Classified Ventures, LLC $1,827.8 $2,473.5 - - -

Alliance Data Systems Corporation (NYSE:ADS) Conversant, Inc. (NasdaqGS:CNVR) $2,448.9 $2,365.3 4.0x 12.0x 6.0%

Micro Focus International plc (LSE:MCRO) The Attachmate Group, Inc. $2,302.4 $2,302.4 2.5x 13.7x -

Thoma Bravo, LLC Compuware Corporation (NasdaqGS:CPWR) $2,366.4 $2,090.9 2.9x 24.5x 5.4%

NPC Group, Inc. Mercury Payment Systems, LLC $1,650.0 $1,650.0 7.0x 17.8x -

VMware, Inc. (NYSE:VMW) AirWatch, LLC $1,540.0 $1,540.0 - - -

Värde Partners Europe Limited Bancopopular-e, S.A. $684.2 $1,341.7 - - -

Centerbridge Partners, L.P. IPC Systems, Inc. $1,200.0 $1,200.0 - - -

Alibaba Group Holding Limited AutoNavi Holdings Limited (NasdaqGS:AMAP) $1,236.2 $1,167.7 8.2x - -11.3%

Vista Equity Partners; Vista Equity Associates V, LLC Advanced Computer Software Group plc (AIM:ASW) $1,140.0 $1,114.2 3.3x 23.6x 30.0%

P2 Capital Partners, LLC Epiq Systems, Inc. (NasdaqGS:EPIQ) $993.4 $1,003.4 2.2x 16.44x 21.7%

Rakuten, Inc. (TSE:4755) Ebates Performance Marketing, Inc. $1,000.0 $1,000.0 6.0x - -

Relativity Media LLC Fullscreen, Inc. $1,000.0 $1,000.0 - - -

Amazon.com Inc. (NasdaqGS:AMZN) Twitch Interactive, Inc. $970.0 $970.0 - - -

Thoma Bravo, LLC TravelCLICK, Inc. $930.0 $930.0 - - -

Rakuten, Inc. (TSE:4755) Viber Media Inc. $900.0 $900.0 - - -

93


Buyer Seller

Purchase

Price (mm)

Enterprise


TTM Rev

Growth

Gemalto NV (ENXTAM:GTO) SafeNet, Inc. $890.0 $890.0 - - -

Apax Partners LLP Exact Holding NV (ENXTAM:EXACT) $932.3 $860.5 3.2x 16.2x 9.1%

Churchill Downs Inc. (NasdaqGS:CHDN) Big Fish Games, Inc. $835.0 $835.0 - 14.6x -

Adobe Systems Incorporated (NasdaqGS:ADBE) Fotolia LLC $800.0 $800.0 - - -

Insight Venture Partners; GIC Special Investments Pte. Ltd. iParadigms, LLC $752.0 $752.0 - - -

Mozido, LLC PayEase, Inc. $750.0 $750.0 - - -

Belden Inc. (NYSE:BDC) Tripwire, Inc. $710.0 $710.0 - - -

ORIX Corporation (TSE:8591) Yayoi Co., Ltd. $691.4 $692.1 4.5x - -

Dassault Systemes SA (ENXTPA:DSY) Accelrys Inc. (NasdaqGS:ACCL) $746.4 $682.9 4.1x 101.4x -

Intel Corporation (NasdaqGS:INTC) LSI Corporation, Axxia Networking Business and Related Assets $650.0 $650.0 5.8x - -

Siris Capital Group, LLC Digital River Inc. (NasdaqGS:DRIV) $1,031.7 $645.8 1.7x 18.1x -2.9%

Yahoo! Inc. (NasdaqGS:YHOO) BrightRoll Inc. $640.0 $640.0 - - -

Teleperformance S.A. (ENXTPA:RCF) Aegis Business Group, Inc. $610.0 $610.0 1.5x - -

Platinum Equity, LLC Sensis Pty Ltd $411.0 $587.1 - .9x -

Nest Labs, Inc. Dropcam, Inc. $555.0 $555.0 - - -

Tuition Build Inc. Limelight Networks, Inc. (NasdaqGS:LLNW) $660.5 $548.1 3.3x - -7.1%

Zhejiang Rongxin Network Technology Co., Ltd. Hangzhou Handsome Electronics Group Co. Ltd. $531.7 $531.7 - - -

Zynga Game International Limited NaturalMotion Ltd. $527.1 $527.1 - - -

XPEC Entertainment Inc. (GTSM:3662) Tiny Piece Co., Ltd. $472.2 $524.7 - - -

IMS Health Holdings, Inc. (NYSE:IMS) Cegedim SA $523.2 $523.2 0.9x 6.0x -

Verint Systems Inc. (NasdaqGS:VRNT) KANA Software, Inc. $514.0 $514.0 - - -

The Carlyle Group LP (NasdaqGS:CG) Dealogic (Holdings) plc $522.1 $502.5 3.6x 9.7x -

Facebook, Inc. (NasdaqGS:FB) LiveRail Inc. $500.0 $500.0 5.0x 33.3x -

94

SELECT MEGA DEALS


MOST ACTIVE BUYERS

Buyer Seller

Purchase

Price (mm)

Enterprise

Value (mm)

TTM Rev

(mm) EV/Revenue

Decade Software Company, LLC - - - -

Des Lauriers Municipal Solutions, Inc. - - - -

Envista Corporation, Inc. - - - -

Government Outreach, Inc. - - - -

IQM2, Inc. - - - -

Beats Music, LLC - - - -

Burstly, Inc. - - - -

Novel Projects, Inc. - - - -

SnappyLabs LLC - - - -

Bitsquid AB - - - -

Circuits.io - - - -

Creative Market Labs, Inc. - - - -

Shotgun Software Inc. - - - -

TeamUp Technologies Inc. - - - -

40 Mobile Applications - - - -

Austin Legate Church, Certain Assets $0.1 $0.1 - -

On the Fly - Voice Translator - - - -

Spermy's Journey, A Race To The Egg! $0.1 $0.1 - -

Metacloud, Inc. - - - -

Tail-f Systems AB $175.0 $175.0 - -

ThreatGrid LLC - - - -

Framehawk, Inc. - - - -

Octoblu, Inc. - - - -

RightSignature LLC $37.5 $36.0 - -

ScaleXtreme Inc. - - - -

Solid Instance, Inc. - - - -

Virtual, LLC - - - -

CareTracker Inc. - - - -

Cunningham Cash Registers Limited - - - -

Incognito Software Inc. and Interactive Enterprises Inc. - - - -

Juniper Consulting SL - - - -

Magic Pulse Limited - - - -

PLANit Sweden AB - - - -

Retention Management LLC - - - -

Wellington IT Solutions Ltd - - - -

Accela, Inc.

Apple Inc. (NasdaqGS:AAPL)

Autodesk, Inc. (NasdaqGS:ADSK)

Brisio Innovations Inc. (OTCPK:NTCE.F)

Cisco Systems, Inc. (NasdaqGS:CSCO)

Citrix Systems, Inc. (NasdaqGS:CTXS)

Constellation Software Inc.

95


Buyer Seller

Purchase

Price (mm)

Enterprise

Value (mm)

TTM Rev

(mm) EV/Revenue

9Cookies GmbH - - - -

Click Delivery - - - -

Kinboy International SA - - - -

Subdelivery - - - -

Covario, Inc., Search and Content Marketing Agency Business - - - -

Fetch Media Ltd - - - -

Tempero Limited - - - -

Aria Glassworks, Inc. - - - -

HackPad Inc. - - - -

Loom, Inc. - - - -

MobileSpan, Inc. - - - -

Parastructure, Inc. - - - -

Photo Lab Inc. - - - -

Predictive Edge - - - -

AppTek Partners, LLC, Machine Translation Technology - - - -

Phisix, Inc. - - - -

Rumgr Inc. - - - -

DiMS! organizing print b.v. - - - -

Rhapso S.A. - - - -

SmartLinc, Inc. - - - -

Maginatics, Inc. - - - -

Spanning Cloud Apps, Inc. - - - -

TwinStrata, Inc. - - - -

Basset AB $9.4 $9.4 - -

IT Sonix AG $9.6 $9.6 - -

Jinny Software Ltd. $17.7 $17.7 $22.7 0.8x

Voxtron nv $8.4 $8.4 - -

Apcera, Inc. - - - -

Azuki Systems, Inc. - - - -

Fabrix Systems Ltd. $95.0 $95.0 - -

MetraTech Corp. - - - -

Sentilla Corporation - - - -

Branch Media, Inc. $15.0 $15.0 - -

Little Eye Software Labs Pvt Ltd. $14.5 $14.5 - -

LiveRail Inc. $500.0 $500.0 - 5.0x

PrivateCore Inc. - - - -

ProtoGeo Oy - - - -

Pryte Ltd. - - - -

WhatsApp Inc. $16,374.2 $16,374.2 - -

EMC Corporation (NYSE:EMC)

Enghouse Systems Limited (TSX:ESL)

Ericsson (OM:ERIC B)

Facebook, Inc. (NasdaqGS:FB)

Electronics for Imaging, Inc. (NasdaqGS:EFII)

Delivery Hero Holding GmbH

Dentsu Aegis Network Ltd.

Dropbox Inc.

eBay Inc. (NasdaqGS:EBAY)

96

MOST ACTIVE BUYERS


Buyer Seller

Purchase

Price (mm)

Enterprise

Value (mm)

TTM Rev

(mm) EV/Revenue

Delivery Club Ltd. - - - -

Kinboy International SA, Mexican Business - - - -

Trinket Info Services Pvt. Ltd. - - $1.6 -

CanaPlus Consulting Pte Ltd - - - -

Solariat, Inc. - - - -

Ventriloquist Customer Communications Solutions - - - -

Bitspin GmbH - - - -

Deepmind Technologies Limited $401.3 $401.3 - -

Impermium Corporation - - - -

SlickLogin - - - -

Spider.io - - - -

Adometry, Inc. - - - -

APPETAS, INC. - - - -

Appurify, Inc. - - - -

Baarzo, Inc. - - - -

Divide - - - -

drawElements Ltd. - - - -

Firebase - - - -

Input Factory Inc. - - - -

Jetpac Inc. - - - -

Lynx Design, Inc. - - - -

mDialog Corp. - - - -

Quest Visual, Inc. - - - -

Rangespan Limited - - - -

Relative Wave, LLC - - - -

Songza Media, Inc. - - - -

Stackdriver Inc. - - - -

ZYNC INC. - - - -

eWinery Solutions, Inc. - - - -

NovaPOS, Inc. - - - -

WineWeb Enterprises, Inc. - - - -

GRÜN MKC IT GmbH - - - -

GRÜN spendino - - - -

ZICOM - - - -

Leaf Holdings, Inc. - - - -

MCS Software, LLC - - - -

TouchNet Information Systems, Inc. $375.0 $375.0 - -

XPIENT Solutions, LLC $30.0 $30.0 - -

foodpanda GmbH

Genesys Telecommunications Laboratories, Inc.

Google Inc. (NasdaqGS:GOOG)

Granbury Restaurant Solutions

GRÜN Software AG

Heartland Payment Systems, Inc. (NYSE:HPY)

97

MOST ACTIVE BUYERS


Buyer Seller

Purchase

Price (mm)

Enterprise

Value (mm)

TTM Rev

(mm) EV/Revenue

iLab Sistemas Especialistas de Informatica Ltda - - - -

Mintec, Inc. - - - -

Vero Software Limited - - $108.2 -

GRASP Systems International, Inc. - - - -

PeopleAnswers, LLC $200.0 $200.0 - 7.0x

SalesLogix, N.A., LLC - - - -

appMobi Inc. - - - -

Ginger Software, Inc., Personal Assistants Platform - - - -

LSI Corporation, Axxia Networking Business and Related $650.0 $650.0 $113.0 5.8x

PasswordBox Inc. - - - -

Cloudant, Inc. - - - -

Lighthouse Security Group, LLC - - - -

Silverpop Systems Inc. - - $80.0 -

Acrede HR and Payroll Solutions (Jersey) Limited - - - -

Check, Inc. $360.0 $360.0 - -

Invitco Pty Limited - - - -

Itrios LLC - - - -

K.D.K. Softwares (India) Pvt. Ltd. - - - -

Lettuce, Inc. - - - -

PaySuite Limited - - - -

Amethon Solutions (Asia Pacific) Pty., Ltd. $1.4 $1.4 - -

Global Group Australia Pty Ltd. - - - -

Search Results Group $5.4 $5.4 - -

Betteroff Networks Pty Ltd. and Ozefax Pty Limited - - - -

Carbonite, Inc. (NasdaqGM:CARB) $366.4 $333.1 $119.5 2.8x

Contactology, Inc. - - - -

Critical Software Ltd - - - -

Web24 Group Pty Ltd - - - -

Bitcellar, Inc. - - - -

Nanapi Inc. - - - -

ScaleOut Inc. - - - -

GenieConnect Ltd - - - -

Passkey International, Inc. - - - -

The Active Network, Inc., ACTIVE Network Business Solutions - - - -

Coplogic, Inc. - - - -

PoliceReports.US, LLC - - - -

Tracesmart Ltd. - - - -

Intel Corporation (NasdaqGS:INTC)

International Business Machines Corporation

(NYSE:IBM)

Intuit Inc. (NasdaqGS:INTU)

Invigor Group Limited (ASX:IVO)

j2 Global, Inc. (NasdaqGS:JCOM)

KDDI Corporation (TSE:9433)

Lanyon, Inc.

LexisNexis Risk Solutions, Inc.

INFOR, INC.

Hexagon AB (OM:HEXA B)

98

MOST ACTIVE BUYERS


Buyer Seller

Purchase

Price (mm)

Enterprise

Value (mm)

TTM Rev

(mm) EV/Revenue

Bizo, Inc. $175.0 $175.0 - 3.5x

Bright Media Corporation, Inc. $120.0 $120.0 - -

Newsle Inc. - - - -

Berkeley Design Automation, Inc. - - - -

Mecel AB, AUTOSAR Assets - - - -

Nimbic, Inc. - - - -

Acompli Inc. - - - -

Aorato Ltd. - - - -

Bit Stadium GmbH - - - -

InMage Systems, Inc. - - - -

InterGrid Limited - - - -

Mojang AB $2,500.0 $2,500.0 - -

SyntaxTree SARL - - - -

Ubikod SARL - - - -

PayEase, Inc. $750.0 $750.0 - -

SK C&C USA Inc. - - - -

StickyStreet Inc. - - - -

13th Lab AB - - - -

Jenkins Software LLC - - - -

Nimble VR - - - -

Advine Mobile Advertising Network Pty Ltd - - - -

apprupt GmbH - - - -

Hunt Mobile Ads - - - -

Blue Kai, Inc. - - - -

Corente, Inc. - - - -

DataLogix Holdings, Inc. - - - -

Front Porch Digital Inc. - - - -

LiveLOOK, Inc. - - - -

MICROS Systems, Inc. (NasdaqGS:MCRS) $5,262.5 $4,604.1 $1,337.9 3.4x

TOA Technologies, Inc. - - - -

Metalogix Software US, Inc. - - - -

TeamViewer GmbH - - - -

Teraco Data Environments (Pty) Ltd. - - - -

30 Second Software, Inc. - - - -

Odyssey Mobile Marketing Ltd. - - - -

Simplikate Systems LLC - - - -

EGS Group Limited $4.8 $3.6 - -

Intelligent Capture Limited $2.6 $2.3 $2.4 1.0x

Intesource, Inc. $3.9 $3.9 $5.0 0.8x

Oculus VR, Inc.

Opera Mediaworks Inc.

Oracle Corporation (NYSE:ORCL)

Permira Advisers Ltd.

Phunware Inc.

PROACTIS Holdings PLC (AIM:PHD)

Mozido, LLC

LinkedIn Corporation (NYSE:LNKD)

Mentor Graphics Corp. (NasdaqGS:MENT)

Microsoft Corporation (NasdaqGS:MSFT)

99

MOST ACTIVE BUYERS


Buyer Seller

Purchase

Price (mm)

Enterprise

Value (mm)

TTM Rev

(mm) EV/Revenue

Ebates Performance Marketing, Inc. $1,000.0 $1,000.0 $167.4 6.0x

Lubic Co., Ltd. - - - -

Slice Technologies, Inc. - - - -

Viber Media Inc. $900.0 $900.0 $0.0 -

VI-VI-VI.COM Co.,Ltd. - - - -

Bookt LLC - - - -

Kigo, Inc. $37.5 $37.5 - -

Notivus Multi-Family, LLC $4.4 $4.4 - -

AMEE Easy Software Solutions Pty Ltd, Easy Dealer $2.4 $2.4 - -

Infinitive Pty Ltd. $15.3 $15.3 - -

Stargate Information Systems Pty Ltd. $32.4 $32.4 - -

Content Savvy Inc. - - - -

PivotLink Corp. - - - -

TagPoints Ltd - - - -

AutoSoft Srl - - - -

IBS automotive s.r.o. - - - -

The Sherwood Group, Inc., United Kingdom Claims Related - - - -

DAX Technologies Corp. $37.0 $37.0 - -

Mobilethink A/S $20.0 $20.0 $8.2 2.4x

Radvision Ltd., Technology Business Unit $25.0 $25.0 - -

Testing Technologies IST GmbH $2.7 $4.7 - -

BRANDERATI Inc. - - - -

Dachis Corporation, Inc. - - - -

TBG Digital Limited - - - -

Brandenburg GmbH - - - -

Coverity, Inc. $375.0 $350.0 - -

Target Compiler Technologies N.V. - - - -

Hadapt, Inc. - - - -

RainStor, Inc. - - - -

Revelytix, Inc. - - - -

AirClic, Inc. $29.7 $29.7 - -

Computer Management USA Inc. $6.6 $6.6 - -

CUSTOMS Info Inc. $42.2 $42.2 - -

e-customs Ltd. $10.3 $10.3 - -

Compuware Corporation (NasdaqGS:CPWR) $2,366.4 $2,090.9 $714.5 2.9x

Sparta Systems, Inc. - - - -

TravelCLICK, Inc. $930.0 $930.0 - -

The Descartes Systems Group Inc (TSX:DSG)

Synopsys Inc. (NasdaqGS:SNPS)

Thoma Bravo, LLC

Teradata Corporation (NYSE:TDC)

Sprinklr Inc.

Rakuten, Inc. (TSE:4755)

RealPage, Inc. (NasdaqGS:RP)

Rubik Financial Limited (ASX:RFL)

SmartFocus SA

Solera Holdings Inc. (NYSE:SLH)

Spirent Communications Plc. (LSE:SPT)

100

MOST ACTIVE BUYERS


Buyer Seller

Purchase

Price (mm)

Enterprise

Value (mm)

TTM Rev

(mm) EV/Revenue

CouponDunia Media Pvt. Ltd. - - - -

Musicfellas Entertainment Private Limited - - - -

RupeeStreet Financial Services Pvt. Ltd. - - - -

Amtech Group Limited - - - -

Gehry Technologies, Inc. - - - -

IRON Solutions, Inc. - - - -

Manhattan Software Group Limited - - - -

Mining Information Systems - - - -

Nexala Ltd. - - - -

The Omega Group, Inc. - - - -

Afterlive.tv Inc - - - -

Apps & Zerts, Inc. - - - -

CardSpring Inc. - - - -

Gnip, Inc. - - - -

Madbits - - - -

Mitro Labs - - - -

Namo Media, Inc. - - - -

Twitpic Inc. - - - -

Applifier Ltd. - - - -

Tsugi, Inc. - - - -

Turiya Media, Inc. - - - -

adGENIE - - - -

GDM Digital $11.0 $11.0 - -

qunb SAS - - - -

Logium Oy - - $6.8 -

Oy Finnvalli Finland Ab - - $6.8 -

SIA FMS Group - - - -

Wallmob A/S PLC - - - -

Autotask Corporation - - - -

DealerSocket, Inc. - - - -

NAVEX Global, Inc. - - - -

Social Solutions, Inc. - - - -

Counterpoint Systems Ltd. - - - -

hawkeye Channel by Vistex - - - -

Vistex Colombia SAS - - - -

AirWatch, LLC $1,540.0 $1,540.0 - -

CloudVolumes, Inc. - - - -

Continuent, Inc. - - - -

Vista Equity Partners

Vistex, Inc.

VMware, Inc. (NYSE:VMW)

Unity Technologies, Inc.

Ve Interactive Ltd.

Visma AS

Times Internet Limited

Trimble Navigation Limited (NasdaqGS:TRMB)

Twitter, Inc. (NYSE:TWTR)

101

MOST ACTIVE BUYERS


Buyer Seller

Purchase

Price (mm)

Enterprise

Value (mm)

TTM Rev

(mm) EV/Revenue

Adchemy, Inc. - - - -

Luvocracy Inc. - - - -

Stylr, Inc. - - - -

Webedia SAS Diwanee Group - - - -

Groupe Confidentielles SARL - - $3.5 -

PurePeople, SAS - - - -

Abacast, Inc. - - - -

Admeta AB - - - -

Castfire, Inc. - - - -

Fivia SA - - $4.2 -

GFG Group Limited $4.7 $41.9 - -

Mikro Odeme A.S. $34.2 $34.2 - -

The AMARA Group Limited $44.8 $44.8 - -

Bookpad Techsoft India Private Limited - - - -

BrightRoll Inc. $640.0 $640.0 - -

Cloud Party, Inc. - - - -

Cooliris, Inc. - - - -

Distill, Inc. - - - -

Flurry, Inc. $300.0 $300.0 - 3.0x

Incredible Labs, Inc. - - - -

LittleInc Labs, Inc. - - - -

Luminate, Inc. - - - -

MEDIA GROUP ONE Digital GmbH - - - -

Meh Labs, Inc. - - - -

RayV Inc. - - - -

Sparq - - - -

SteamFunk Labs Inc. - - - -

Tomfoolery Inc. - - - -

Wander Inc. - - - -

ADFOX - - - -

KitLocate Ltd. - - - -

Sovetnik - - - -

Creative Web, s.r.o., Obedovat.sk $1.0 $1.0 - -

Lunchtime.cz s.r.o. $2.3 $2.3 - -

Menu Mania Ltd - - - -

Yandex N.V. (NasdaqGS:YNDX)

Yahoo! Inc. (NasdaqGS:YHOO)

Wirecard AG (XTRA:WDI)

WideOrbit Inc.

WalmartLabs, Inc.

Zomato Media Private Limited

102

MOST ACTIVE BUYERS


SELECT SaaS TRANSACTIONS

Date Buyer Seller

Enterprise

Value (mm)

TTM Rev

(mm) EV/Rev

12/29/14 U-BTech Solutions LTD. Agile IT, Inc. - - -

12/23/14 Trimble Navigation Limited (NasdaqGS:TRMB) IRON Solutions, Inc. - - -

12/22/14 AMN Healthcare Services Inc. (NYSE:AHS) Avantas, LLC $25.0 - -

12/22/14 Diversis Capital, LLC Blue Software, LLC - - -

12/19/14 Accumuli plc (AIM:ACM) RandomStorm Ltd. $13.9 $5.5 2.5x

12/19/14 Koggbron AB Business Control Systems Sverige (OM:BCS) - - -

12/18/14 Dealertrack Technologies (NasdaqGS:TRAK) Incadea Plc (AIM:INCA) $202.5 $54.3 3.7x

12/18/14 Commerce Technologies, Inc. Mercent Corporation - - -

12/17/14 Datanyze, Inc. LeadLedger LLC - - -

12/17/14 Deutscher Sparkassen Verlag GmbH PAYONE GmbH - - -

12/17/14 GovDelivery, Inc. NuCivic Inc. - - -

12/16/14 MongoDB, Inc. WiredTiger, Inc. - - -

12/15/14 Telstra Corporation Limited (ASX:TLS) Cloud9 IDE, Inc. - - -

12/12/14 USG People NV (ENXTAM:USG) Connecting-Expertise NV - - -

12/12/14 Infinite Cohesion, Ltd. DynaCal, LLC - - -

12/11/14 Aimia Inc. (TSX:AIM) Zed Inc. Ltd. - - -

12/11/14 EggZack, Inc. Trellis Technology Inc. - - -

12/11/14 Meridian Medical Management Origin Healthcare Solutions LLC - - -

12/11/14 Datto, Inc. Backupify, Inc. - - -

12/10/14 Epicor Software Corporation ShopVisible, LLC $19.2 - -

12/10/14 Emdeon Inc. AdminiSource Communications, Inc. $35.0 - -

12/10/14 Cirruspath, Inc. Opencore LLC - - -

12/10/14 Intuit Inc. (NasdaqGS:INTU) Acrede HR and Payroll Solutions (Jersey) Limited - - -

12/09/14 Retail Success, LLC Kiplie, Inc. - - -

12/09/14 Ricoh Company, Ltd. (TSE:7752) PTI Marketing Technologies, Inc. - - -

12/09/14 Avizia, Inc. Emerge.MD, Inc. - - -

12/08/14 The Descartes Systems Group Inc (TSX:DSG) e-customs Ltd. $10.3 - -

12/08/14 Periscope Holdings, Inc. RFP Depot, LLC - - -

12/08/14 GRÜN Software AG GRÜN spendino - - -

12/03/14 Access Technology Group Ltd. StratoGen Internet Limited - - -

12/02/14 j2 Global, Inc. (NasdaqGS:JCOM) Carbonite, Inc. (NasdaqGM:CARB) $333.1 $119.4 2.8x

103


Date Buyer Seller

Enterprise

Value (mm)

TTM Rev

(mm) EV/Rev

12/02/14 Citrix Systems, Inc. (NasdaqGS:CTXS) Octoblu, Inc. - - -

11/30/14 QuestionPro Inc. RapidEngage - - -

11/24/14 Global Experience Specialists, Inc. N200 Holding B.V. $13.7 - -

11/24/14 Slice Technologies, Inc. Unroll.Me Inc. - - -

11/21/14 Upland Software, Inc. (NasdaqGM:UPLD) Solution Q, Inc. $5.8 - -

11/21/14 Yahoo! Inc. (NasdaqGS:YHOO) Cooliris, Inc. - - -

11/20/14 Central Data Storage, LLC Optyn, Inc. - - -

11/20/14 OptionsCity Software, Inc. Optionshop Brokerage, LLC - - -

11/19/14 The Descartes Systems Group Inc (TSX:DSG) AirClic, Inc. $29.7 - -

11/19/14 Pluralsight LLC Smarterer, Inc. $75.0 - -

11/19/14 ScholarChip Card LLC ABE Systems, Inc. - - -

11/19/14 Aleyant Systems, LLC Tucanna Software & Development LLC - - -

11/18/14 Isentric Limited (ASX:ICU) DataMorph Services Sdn. Bhd. $0.1 - -

11/18/14 1-PAGE LIMITED (ASX:1PG) BranchOut, Inc. $4.8 - -

11/18/14 Merkle Inc. 500friends, Inc. - - -

11/18/14 Campaign Monitor Pty Ltd GetFeedback - - -

11/18/14 Books International Inc. Cloud View Technologies LLC - - -

11/18/14 Next Generation Innovation BVBA ASPIDER Solutions B.V. - - -

11/17/14 Groupon, Inc. (NasdaqGS:GRPN) Swarm Solutions, Inc. - - -

11/13/14 Get It, LLC Employ Insight LLC - - -

11/12/14 Target Corp. (NYSE:TGT) PoweredAnalytics, Inc. - - -

11/11/14 Cox Automotive, Inc. Xtime Inc. $325.0 - -

11/11/14 Liaison International, Inc. Spectrum Edu Solutions LLC - - -

11/11/14 Tamedia AG (SWX:TAMN) Doodle AG - - -

11/10/14 QHR Corporation (TSXV:QHR) Medeo Corporation $3.0 - -

11/10/14 Market Track, LLC Media Iris, LLC - - -

11/10/14 Citrix Systems, Inc. (NasdaqGS:CTXS) Solid Instance, Inc. - - -

11/09/14 24/7 Inc. IntelliResponse Systems Inc. - - -

11/08/14 Searce, Inc. Feecounter Online Services (P) Ltd. - - -

11/06/14 Global Healthcare Exchange, LLC Vendormate, Inc. - - -

11/06/14 Copyright Clearance Center, Inc. Infotrieve, Inc. - - -

11/06/14 BrandMaker GmbH advertzoom GmbH - - -

104



Date Buyer Seller

Enterprise

Value (mm)

TTM Rev

(mm) EV/Rev

11/06/14 The Jackson Clinic eRAD Image Medical, Inc. - - -

11/05/14 Xero Limited. (NZSE:XRO) Monchilla, Inc. $7.1 - -

11/05/14 LivePerson Inc. (NasdaqGS:LPSN) ContactAtOnce! LLC $70.0 - -

11/05/14 The Carlyle Group LP (NasdaqGS:CG) Dealogic (Holdings) plc $502.5 $140.8 3.5x

11/05/14 Maritz Research, Inc. Allegiance, Inc. - - -

11/04/14 Zipmark Inc. NetBooks Inc. - - -

11/04/14 Behavioral Science Technology, Inc. Regulatory Consultants, Inc. - - -

11/04/14 WebPT, Inc. WebOutcomes, LLC - - -

11/04/14 T2 Systems, Inc. CASE Parking, LLC - - -

11/04/14 Immobilien Scout GmbH Flowfact AG - - -

11/03/14 West Corporation (NasdaqGS:WSTC) GroupCast, L.L.C. $13.5 - -

11/03/14 Aetna Inc. (NYSE:AET) bswift, LLC $400.0 - -

11/03/14 Unchained Apps Limited Social Agent Limited - - -

10/31/14 Capital One, N.A. AmeriCommerce, L.P. - - -

10/31/14 Salsa Labs, Inc. givezooks!, Inc. - - -

10/30/14 Permira Advisers Ltd. Metalogix Software US, Inc. - - -

10/30/14 COMPAREX AG Cloudbearing, Inc. - - -

10/29/14 Nielsen N.V. (NYSE:NLSN) Affinnova, Inc. - - -

10/29/14 PerkinElmer Inc. (NYSE:PKI) Ceiba Solutions, Inc. - - -

10/29/14 MEDA Limited Conferplace Ltd. - - -

10/29/14 Cloud Nation, Inc. Cloud Nation, LLC - - -

10/28/14 Zift Solutions, Inc. Marketing Advocate, LLC - - -

10/28/14 Cigital, Inc. iViZ Techno Solutions Pvt. Ltd. - - -

10/28/14 EMC Corporation (NYSE:EMC) Spanning Cloud Apps, Inc. - - -

10/28/14 EMC Corporation (NYSE:EMC) Maginatics, Inc. - - -

10/27/14 Adapt IT (Pty) Limited AspiviaUnison Proprietary Limited $18.4 - -

10/24/14 NetApp, Inc. (NasdaqGS:NTAP) Riverbed Technology, Inc., SteelStore Product Line $80.0 - -

10/23/14 Newzulu Limited (ASX:NWZ) Filemobile Inc. $4.4 - -

10/23/14 Proofpoint, Inc. (NasdaqGM:PFPT) Nexgate Corporation $35.0 - -

10/21/14 BAE Systems plc (LSE:BA.) Perimeter Internetworking Corp. $232.5 - -

10/21/14 Progress Software Corporation (NasdaqGS:PRGS) Telerik AD $262.5 $59.9 4.4x

10/21/14 Google Inc. (NasdaqGS:GOOGL) Firebase - - -

10/20/14 Altus Group Limited (TSX:AIF) Voyanta Limited $9.3 - -

105



Date Buyer Seller

Enterprise

Value (mm)

TTM Rev

(mm) EV/Rev

10/20/14 Stamps.com Inc. (NasdaqGS:STMP) ShipWorks $22.0 - -

10/20/14 LexisNexis Group Inc. Moreover Technologies, Inc. - - -

10/20/14 Square 2 Marketing, Inc. The Savvy Group, LLC - - -

10/20/14 PCCW Global Limited Crypteia Networks A.E. - - -

10/16/14 Premiere Global Services, Inc. (NYSE:PGI) Central Desktop, Inc. - - -

10/16/14 Digital Guardian, Inc. Armor5, Inc. - - -

10/15/14 Fusion Telecommunications Intl, Inc.

(NasdaqCM:FSNN)PingTone Communications, Inc. $10.1 $8.1 1.3x

10/15/14 Autodesk, Inc. (NasdaqGS:ADSK) TeamUp Technologies Inc. - - -

10/15/14 ABILITY Network Inc. MD On-Line, Inc. - - -

10/15/14 C-Motech Co., Ltd. Mobile Knowledge Systems Inc. - - -

10/15/14 Nationwide Appraisal Services Inc InHouse Inc. - - -

10/14/14 Demandware, Inc. (NYSE:DWRE) CQuotient, Inc. - - -

10/14/14 Leeds Equity Partners, LLC iModules Software, Inc. - - -

10/13/14 Accanto Systems Oy InstantCEM Ltd - - -

10/12/14 SPS Commerce Australia Pty Ltd. LTG Lakeside Pty Ltd $14.9 $6.3 2.4x

10/10/14 Ensighten, Inc. Anametrix, Inc. - - -

10/09/14 Hodges-Mace Benefits Group, Inc. SmartBen, Inc. - - -

10/07/14 Scytl Secure Electronic Voting, S.A. Akira Systems Inc. $2.5 - -

10/07/14 Cornerstone OnDemand, Inc. (NasdaqGS:CSOD) Evolv, Inc. $44.5 - -

10/07/14 Mystery Researchers, LLC Beyond Hello Inc. - - -

10/07/14 Hitachi Systems, Ltd. SecureBrain Corporation - - -

10/07/14 Symbility Solutions Inc. (TSXV:SY) Symbility Solutions GmbH - - -

10/06/14 Actuera B.V. Artena B.V. - - -

10/06/14 Zenovia Digital Exchange Corporation AdJuggler, Inc. - - -

10/06/14 Senior Sistemas S.A. Sythex Tecnologia em Sistemas - - -

10/05/14 e-conomic international a/s SpeedLedger AB - - -

10/03/14 Qumu Corporation (NasdaqCM:QUMU) Qumu Cloud $14.6 $5.5 2.7x

10/02/14 Good Technology Corporation Macheen, Inc. $8.3 - -

10/02/14 Iron Mountain Inc. (NYSE:IRM) Fontis International, Inc. - - -

10/02/14 USG People NV (ENXTAM:USG) Netwerven B.V. - - -

10/01/14 PeopleStrong HR Services Pvt. Ltd. Big Byte Solutions Pvt. Ltd. - - -

10/01/14 Talent Partners, Inc. PES Payroll Inc. - - -

106



Date Buyer Seller

Enterprise

Value (mm)

TTM Rev

(mm) EV/Rev

10/01/14 ThingLink Oy Smartag - - -

10/01/14 Francisco Partners Management LLC Vendavo, Inc. - - -

09/22/14 Sage Group plc (LSE:SGE) PAI Group, Inc. $157.8 $38.9 4.1x

09/22/14 Premiere Global Services, Inc. (NYSE:PGI) TalkPoint Holdings, LLC - - -

09/22/14 Ericsson (OM:ERIC B) Apcera, Inc. - - -

09/19/14 REWE Digital GmbH commercetools GmbH - - -

09/19/14 The Hearst Corporation BranchOut, Inc. - - -

09/18/14 SAP America, Inc. Concur Technologies, Inc. (NasdaqGS:CNQR) $7,651.6 $667.7 11.5x

09/18/14 HRdirect Hello Industries Inc. - - -

09/18/14 Red Hat, Inc. (NYSE:RHT) FeedHenry Ltd.* $82.0 $4.1 20.0x

09/18/14 ParTech, Inc. Brink Software, Inc. $17.0 - -

09/18/14 Geospatial Corporation (OTCPK:GSPH) ShaleNavigator - - -

09/17/14 Cisco Systems, Inc. (NasdaqGS:CSCO) Metacloud, Inc. - - -

09/17/14 Boyser S.R.L Dexma Sensors, SL - - -

09/16/14 Callidus Software Inc. (NasdaqGM:CALD) Clicktools Ltd.* $16.4 $2.3 7.0x

09/16/14 Kenshoo, Ltd. Adquant Ltd - - -

09/16/14 OnApp Limited SoluLabs Ltd. - - -

09/15/14 Cision AB; Vocus Inc. Visible Technologies, Inc. - - -

09/15/14 Brocade Communications (Nasdaq:BRCD) Vistapointe Networks - - -

09/14/14 Oracle Corporation (NYSE:ORCL) Front Porch Digital Inc. - - -

09/12/14 Sabre Corporation (NasdaqGS:SABR) Genares Worldwide Reservation Services, Ltd. - - -

09/12/14 Genstar Capital, LLC Construction Software Technologies, Inc. - - -

09/11/14 Givex Corporation Marqui Inc. - - -

09/11/14 Ticketmaster Entertainment, LLC Eventjoy, Inc. - - -

09/11/14 Ericsson (OM:ERIC B) Fabrix Systems Ltd. $95.0 - -

09/10/14 Equiniti Limited Charter UK Ltd. - - -

09/10/14 FxPro Group Limited Quotix Limited - - -

09/09/14 Pointer Telocation Ltd. (NasdaqCM:PNTR) Thales Telematics - - -

09/09/14 QmedRx, Inc. GoEscribe - - -

09/05/14 Intercontinental Exchange, Inc. (NYSE:ICE) SuperDerivatives Inc. $350.0 - -

09/04/14 Figaro Classifieds S.A.; RegionsJob SAS Ubiposting SAS - - -

09/03/14 Symphony Technology Group Ventiv Technology Inc. - - -

107



Date Buyer Seller

Enterprise

Value (mm)

TTM Rev

(mm) EV/Rev

09/03/14 Fidelity National Info. Services, Inc. (NYSE:FIS) Clear2Pay nv/sa* $492.7 $123.2 4.0x

09/03/14 Capita plc (LSE:CPI) Eclipse Hardware Limited - - -

09/02/14 HomeAdvisor, Inc. Mhelpdesk, Inc. - - -

09/02/14 Mixpo, Inc. ShopIgniter, Inc. - - -

09/02/14 Shenzhen Xunlei Networking Technologies Kuaipan Personal and Kansunzi Business Assets $33.0 - -

09/02/14 RealNex Ten Eight LLC - - -

09/01/14 Equiniti Limited Invigia Limited - - -

08/29/14 Omnitracs, LLC XRS Corporation (NasdaqCM:XRSC) $177.5 $53.0 3.4x

08/29/14 Morpho SA Dictao Siege - - -

08/29/14 OmniEarth Inc. IRISmaps, Inc. - - -

08/27/14 SmartFocus SA Content Savvy Inc. - - -

08/27/14 GL Education Group Limited The Test Factory Limited - - -

08/27/14 SmartFocus SA TagPoints Ltd - - -

08/26/14 Mailigen Limited Leadersend ltd. - - -

08/26/14 Google Inc. (NasdaqGS:GOOGL) ZYNC INC. - - -

08/26/14 UST Global Inc. Trulioo, Inc. - - -

08/26/14 Auctane LLC Finale Inventory - - -

08/26/14 Veeder-Root Company Inc. FuelQuest, Inc. - - -

08/25/14 Dynamic Signal Inc. PaperShare, Inc. - - -

08/21/14 Host Europe WVS Limited Sign-Up Technologies Ltd. - - -

08/20/14 GoDaddy Inc. Mad Mimi, LLC - - -

08/20/14 TeamSnap, Inc. Easy Team Manager - - -

08/19/14 Readyforce, Inc. HireBrite, LLC - - -

08/15/14 VMware, Inc. (NYSE:VMW) CloudVolumes, Inc. - - -

08/14/14 RedeHost Internet Ltda. Mailee - - -

08/14/14 INFOR, INC. SalesLogix, N.A., LLC - - -

08/13/14 Intuit Inc. (NasdaqGS:INTU) Itrios LLC - - -

08/12/14 iQU B.V. HoneyTracks GmbH - - -

08/12/14 Singapore eDevelopment Limited (Catalist:5QZ) Cloudtel Pte. Ltd. - - -

08/12/14 Kaseya International Shared Services Sàrl Scorpion Software Corp. - - -

08/12/14 SHE Software Ltd Mobile Safety Solutions Limited - - -

08/12/14 LexisNexis Risk Solutions, Inc. Coplogic, Inc. - - -

108



Date Buyer Seller

Enterprise

Value (mm)

TTM Rev

(mm) EV/Rev

08/11/14 Thinking Phone Networks, Inc. Whaleback Systems Corporation - - -

08/11/14 International Business Machines (NYSE:IBM) Lighthouse Security Group, LLC - - -

08/11/14 Manhattan Associates, Inc. (NasdaqGS:MANH) GlobalBay Technologies Inc. - - -

08/07/14 Intuit Inc. (NasdaqGS:INTU) PaySuite Limited - - -

08/06/14 FuseMail, LLC MXSweep Limited - - -

08/05/14 Bullhorn, Inc. The Code Works Inc. - - -

08/04/14 Rocket Fuel Inc. (NasdaqGS:FUEL) [x+1], Inc. $236.0 $72.0 3.3x

08/04/14 comScore, Inc. (NasdaqGS:SCOR) MdotLabs, Inc. $4.5 - -

08/01/14 Frontline Technologies Group LLC Aspex Solutions - - -

08/01/14 cloudControl Inc. Docker, Inc., DotCloud PaaS Business - - -

07/31/14 SQAD Inc. Workhorse Software Company - - -

07/31/14 HootSuite Media Inc. Brightkit - - -

07/31/14 Oracle Corporation (NYSE:ORCL) TOA Technologies, Inc. - - -

07/31/14 Goldstar North American Mining, Inc. XFormity Technologies, Inc. (OTCPK:XFMY) - - -

07/30/14 Intuit Inc. (NasdaqGS:INTU) K.D.K. Softwares (India) Pvt. Ltd. - - -

07/30/14 j2 Global, Inc. (NasdaqGS:JCOM) Contactology, Inc. - - -

07/30/14 Qualcomm Technologies, Inc. Empowered Careers Inc. - - -

07/29/14 Ericsson (OM:ERIC B) MetraTech Corp. - - -

07/29/14 Engage Mobility, Inc. (OTCPK:ENGA) Hub Data, Inc., Certain Assets - - -

07/28/14 Twitter, Inc. (NYSE:TWTR) Madbits - - -

07/28/14 2426818 Ontario Inc. MediaMiser Ltd. $8.5 $3.6 2.4x

07/28/14 Beijing Tongtech Co., Ltd. (SZSE:300379) Neostart, Inc. $4.9 - -

07/25/14 RIB Software AG (DB:RSTA) Byggeweb A/S $25.9 - -

07/24/14 Crucible Gold Limited (ASX:CUG) Dubber Pty Ltd $5.2 - -

07/23/14 PTC Inc. (NasdaqGS:PTC) Axeda Corporation* $170.0 $24.3 7.0x

07/22/14 Docker, Inc. Orchard Laboratories Ltd - - -

07/21/14 LinkedIn Corporation (NYSE:LNKD) Bizo, Inc. $175.0 $50.0 3.5x

07/21/14 RCS Capital Corporation (NYSE:RCAP) Trupoly, Inc. - - -

07/18/14 Blackfin Capital Partners SAS Able B.V. - - -

07/17/14 Teradata Corporation (NYSE:TDC) Hadapt, Inc. - - -

07/17/14 NetSuite Inc. (NYSE:N) Venda, Inc. $50.5 - -

07/16/14 HighJump Software Inc. Atlas Products International Holdings Ltd. - - -

109



Date Buyer Seller

Enterprise

Value (mm)

TTM Rev

(mm) EV/Rev

07/16/14 Zillow, Inc. (NasdaqGS:Z) Retsly Software, Inc. - - -

07/15/14 Equity Administration Solutions, Inc. Option Admin, Inc. - - -

07/15/14 Chef, Inc. Tower3 Inc. - - -

07/14/14 Lexalytics, Inc. Semantria LLC - - -

07/11/14 Comcast Corporation (NasdaqGS:CMCS.A) PowerCloud Systems, Inc. - - -

07/10/14 Ascentis Corporation Starfield TMS, LLC - - -

07/10/14 Salesforce.com, Inc (NYSE:CRM) RelateIQ, Inc. $391.0 - -

07/09/14 Add Shoppers, LLC Sociaby, LLC - - -

07/09/14 ServiceNow, Inc. (NYSE:NOW) Neebula Systems Ltd.* $100.0 $5.0 20.0x

07/08/14 GTCR, LLC; Opus Global Holdings Hiperos, LLC - - -

07/08/14 Top Image Systems Ltd. (NasdaqCM:TISA) eGistics, Inc. $18.0 $10.6 1.7x

07/08/14 EMC Corporation (NYSE:EMC) TwinStrata, Inc. - - -

07/08/14 Vista Equity Partners Social Solutions, Inc. - - -

07/07/14 Asure Software, Inc. (NasdaqCM:ASUR) FotoPunch Inc. $4.5 - -

07/07/14 Thoma Bravo, LLC Sparta Systems, Inc. - - -

07/07/14 Zero2Sixty Software, Inc. Conductiv Inc. - - -

07/04/14 Zimbra, Inc. Mezeo Software Corporation - - -

07/04/14 Enghouse Systems Limited (TSX:ESL) Basset AB $9.4 - -

07/02/14 EPOSability Ltd. Mylivevision Limited - - -

07/02/14 Roper Industries Inc. (NYSE:ROP) FoodLink Holdings, Inc. - - -

07/01/14 Taxware, LLC Convey Compliance Systems, Inc. - - -

07/01/14 EFactor Group Corp. (OTCPK:EFCT) Member Digital Ltd $1.0 - -

06/25/14 Autodesk, Inc. (NasdaqGS:ADSK) Shotgun Software Inc. - - -

06/24/14 Indeed, Inc. MoBolt, Inc. - - -

06/24/14 DataBank IMX, LLC Cogniserv, LLC - - -

06/23/14 Learfield Sports, LLC SIDEARM Sports Inc. - - -

06/20/14 Oracle Corporation (NYSE:ORCL) LiveLOOK, Inc. - - -

06/20/14 Nest Labs, Inc. Dropcam, Inc. $555.0 - -

06/20/14 Telvent DTN, LLC RevCo, LLC - - -

06/19/14 Twitter, Inc. (NYSE:TWTR) Afterlive.tv Inc - - -

06/17/14 Paychex, Inc. (NasdaqGS:PAYX) NETtime Solutions, LLC - - -

06/17/14 Informatica Corporation (NasdaqGS:INFA) StrikeIron, Inc. - - -

110



Date Buyer Seller

Enterprise

Value (mm)

TTM Rev

(mm) EV/Rev

06/16/14 Box INC. Greply Inc. - - -

06/13/14 Solocal Group SA (ENXTPA:LOCAL) Leadformance SAS - - -

06/13/14 Tuition Build Inc. Limelight Networks, Inc. (NasdaqGS:LLNW) $548.1 $168.6 3.3x

06/12/14 CloudLock, Inc. Innovode Ltd - - -

06/12/14 The Priceline Group Inc. (NasdaqGS:PCLN) OpenTable, Inc. (NasdaqGS:OPEN) $2,495.5 $198.4 12.6x

06/10/14 Stamps.com Inc. (NasdaqGS:STMP) Auctane LLC $76.3 - -

06/09/14 Accela, Inc. Envista Corporation, Inc. - - -

06/09/14 Moody's Analytics, Inc. WebEquity Solutions, LLC - - -

06/09/14 Connection Telecom (Pty) Ltd FatBudgie - - -

06/09/14 eFolder, Inc. CloudFinder Sweden AB - - -

06/09/14 One Source Networks Inc. Shango - - -

06/08/14 One Software Technologies (TASE:ONE) BALINK Limited - - -

06/06/14 DAXKO LLC NetVentures Corporation - - -

06/05/14 MYOB Holdings Pty Limited Kounta, Pty Ltd. - - -

06/04/14 Fleetmatics Group PLC (NYSE:FLTX) KKT Srl - - -

06/04/14 Rocap Marketing Inc. (OTCBB:ROCP) Spiral Toys, Inc. - - -

06/03/14 Acquia, Inc. TruCentric Inc. - - -

06/03/14 Cloudera, Inc. Gazzang, Inc. - - -

06/03/14 The Priceline Group Inc. (NasdaqGS:PCLN) buuteeq Inc. - - -

06/02/14 Insight Venture Partners iParadigms, LLC $752.0 - -

06/02/14 Bematech SA (BOVESPA:BEMA3) UNUM Tecnologia $17.7 $4.4 4.0x

06/02/14 Hover Networks, Inc. Voyss Solutions, Inc. - - -

06/02/14 The Descartes Systems Group Inc (TSX:DSG) CUSTOMS Info Inc. $42.2 - -

06/02/14 Loop, LLC CAR Research, Inc. - - -

05/30/14 TrialScope Inc. Deloitte Analytics LLC - - -

03/26/14 SAP AG (DB:SAP) Fieldglass, Inc. - - -

03/25/14 Golden Gate Capital LiveVox, Inc. - - -

03/21/14 ALSO Holding AG (SWX:ALSN) Nervogrid Oy - - -

03/20/14 Dromana Estate Ltd. (ASX:DMY) CloudCentral Pty Ltd $2.4 - -

03/19/14 IgnitionOne, Inc. Knotice, Ltd. - - -

03/19/14 InterCloud Systems, Inc. (NasdaqCM:ICLD) VaultLogix, LLC $44.0 $12.0 3.7x

111



Date Buyer Seller

Enterprise

Value (mm)

TTM Rev

(mm) EV/Rev

03/19/14 BigHand Ltd. Esquire Innovations, Inc. - - -

03/18/14 Dropbox, Inc. Zulip, Inc. - - -

03/18/14 TrustWave Holdings, Inc. Cenzic, Inc. - - -

03/18/14 Thoma Bravo, LLC TravelCLICK, Inc.* $930.0 $265.7 3.5x

03/17/14 Everbridge, Inc. Vocal Ltd. - - -

03/14/14 Charterhouse Capital Partners LLP SkillSoft Limited - - -

03/13/14 Clear Payment Solutions LLC eKiosk Solutions LLC - - -

03/12/14 eBet Limited (ASX:EBT) Industry Data Online Pty Ltd $0.6 - -

03/12/14 Xumanii International Holdings Corp (OTCPK:XUII) Amonshare.com $1.5 - -

03/11/14 Sysxnet Limited SaaS Markets, LLC - - -

03/11/14 Ian Martin Limited Fitzii, Inc. - - -

03/10/14 Chinasoft International Ltd. (SEHK:354) Deem, Inc. - - -

03/07/14 DocuSign, Inc. Comprova.com Informatica S.A. - - -

03/06/14 Axium XTS Corporation ArchitTrek, LLC - - -

03/05/14 L-3 Communications Holdings Inc. (NYSE:LLL) L-3 Data Tactics - - -

03/05/14 Raine Ventures LLC The Immediate Edge $1.4 $0.5 2.7x

03/05/14 Tribal Group plc (LSE:TRB) Sky Software Pty Limited $19.1 - -

03/04/14 TalentSoft SA PeopleXS Holding BV - - -

03/03/14 Shutterstock, Inc. (NYSE:SSTK) WebDAM, Inc. - - -

03/03/14 Securus Technologies, Inc. Telerus, Inc. - - -

02/28/14 Corporate Executive Board Co. (NYSE:CEB) KnowledgeAdvisors, Inc.* $52.0 $17.3 3.0x

02/28/14 FrontStream Payments, Inc. Truist, Inc. - - -

02/26/14 Workday, Inc. (NYSE:WDAY) Identified, Inc. - - -

02/26/14 Square, Inc. BookFresh - - -

02/26/14 Wolters Kluwer Corporate Legal Services Third Coast Holdings Inc $290.3 $50.1 5.8x

02/26/14 DEKRA International GmbH TTL Automotive Ltd. - - -

02/25/14 AmbiCom Holdings, Inc. (OTCPK:ABHI) Veloxum Corporation - - -

02/24/14 Oracle Corporation (NYSE:ORCL) Blue Kai, Inc. - - -

02/24/14 Monster Worldwide, Inc. (NYSE:MWW) Gozaik LLC - - -

02/24/14 CloudFlare, Inc. Jaal, LLC - - -

02/24/14 International Business Machines Corporation

(NYSE:IBM)Cloudant, Inc. - - -

02/24/14 QSC AG (XTRA:QSC) FTAPI Software GmbH - - -

112



Date Buyer Seller

Enterprise

Value (mm)

TTM Rev

(mm) EV/Rev

02/20/14 OTOY, Inc. AppSlingr, Inc. - - -

02/19/14 Sprinklr Inc. Dachis Corporation, Inc. - - -

02/19/14 FSX Interlinked, Inc. Interlinked, Inc. - - -

02/19/14 Ocuco Limited EMRlogic Systems Inc. - - -

02/19/14 Clearswift Limited Microdasys Europe GmbH - - -

02/18/14 Remark Media, Inc. (NasdaqCM:MARK) BH Enterprises of FL, Inc., TaxExtension.com Assets - - -

02/18/14 ClickSoftware Technologies Ltd. (NasdaqGS:CKSW) Xora, Inc. $14.7 - -

02/18/14 Wyless Inc. ASPIDER Solutions B.V. - - -

02/18/14 Court Square Capital Partners AFS Technologies, Inc. - - -

02/14/14 Equifax Inc. (NYSE:EFX) Forseva, LLC - - -

02/13/14 Yahoo! Inc. (NasdaqGS:YHOO) Distill, Inc. - - -

02/11/14 SearchDex, Inc. Altruik, Inc. - - -

02/11/14 j2 Global, Inc. (NasdaqGS:JCOM) Betteroff Networks Pty Ltd. and Ozefax Pty Limited - - -

02/11/14 RealPage, Inc. (NasdaqGS:RP) Bookt LLC - - -

02/10/14 Visma AS Logium Oy - - -

02/06/14 Ericsson (OM:ERIC B) Azuki Systems, Inc. - - -

02/06/14 Arqiva Broadcast Holdings Limited Capablue Ltd - - -

02/05/14 Persistent Systems Limited (BSE:533179) Cloudsquads, Inc. - - -

02/05/14 PointAcross, Inc. GoldMail, Inc. - - -

02/04/14 Callidus Software Inc. (NasdaqGM:CALD) LeadRocket, Inc. $3.0 - -

02/04/14 Service Scout, Inc. Betterfly, Inc. - - -

01/31/14 Physio-Control, Inc. Sansio, Inc. - - -

01/31/14 Altiux Innovations Pvt Ltd. P-Device Systems Pvt Ltd - - -

01/31/14 Vector Capital CollabNet, Inc. - - -

01/31/14 Explorer Software Inc. Computer Guidance Corporation - - -

01/30/14 SalesFUSION Inc. LoopFuse, Inc. - - -

01/29/14 Bottomline Technologies (de), Inc. (NasdaqGS:EPAY) Rationalwave, Inc. $8.0 - -

01/29/14 ThinkHR Corporation HR That Works, Inc. - - -

01/27/14 LiveOps, Inc. UserEvents, Inc. - - -

01/27/14 Navico Holding AS Contour Innovations, LLC - - -

01/27/14 Berkshire Hathaway Specialty Insurance MyAssist Inc. and Insure America LLC - - -

113



Date Buyer Seller

Enterprise

Value (mm)

TTM Rev

(mm) EV/Rev

01/26/14 Dealer Authority eReputationBuilder - - -

01/24/14 Budget Center Inc. (OTCPK:BDGN) Vericard Inc. $0.9 - -

01/23/14 AdRoll, Inc. Userfox - - -

01/23/14 The Gores Group LLC Zmags, Corp. - - -

01/22/14 ServiceSource International, Inc. (NasdaqGS:SREV) Scout Analytics, Inc. $32.5 $5.4 6.0x

01/20/14 Callcredit Information Group Limited Coactiva Aspiren Ltd - - -

01/20/14 Ellucian, Inc. CampusIT Limited - - -

01/20/14 Genesys Telecommunications Laboratories, Inc. Ventriloquist Customer Communications Solutions

Intl- - -

01/18/14 Allied Wallet, Ltd. Cloudasia Limited - - -

01/16/14 4CAD Group Plate-forme d’Ingénierie Collaborative de Cités en

Champagne- - -

01/16/14 Electronics for Imaging, Inc. (NasdaqGS:EFII) SmartLinc, Inc. - - -

01/16/14 HUBHEAD CORP. NRX Global Inc. - - -

01/15/14 Trusted Team LLC 22Touch Systems, Inc. - - -

01/15/14 Google Inc. (NasdaqGS:GOOG) Impermium Corporation - - -

01/15/14 Hamilton-Ryker IT Solutions, LLC WMS iSymphony, Inc. - - -

01/14/14 RuffaloCODY, LLC ScaleFunder, Inc. - - -

01/14/14 PROACTIS Holdings PLC (AIM:PHD) EGS Group Limited $3.6 - -

01/13/14 Project Management Institute, Inc., Endowment Arm ProjectManagement.com And ProjectsAtWork - - -

01/13/14 NGB Markets, Inc. Local Food Systems, Inc. - - -

01/10/14 Deutsche Boerse AG (XTRA:DB1) Impendium Systems Ltd. - - -

01/10/14 Qualcomm Connected Experiences, Inc. kooaba AG - - -

01/10/14 AFS Technologies, Inc. Visicom Inc. - - -

01/09/14 HireVue, Inc. Reschedge - - -

01/08/14 IQNavigator, Inc. ProcureStaff Technologies, Ltd. - - -

01/07/14 INFOR, INC. PeopleAnswers, LLC $200.0 $28.6 7.0x

01/07/14 Oracle Corporation (NYSE:ORCL) Corente, Inc. - - -

01/06/14 Verint Systems Inc. (NasdaqGS:VRNT) KANA Software, Inc.* $514.0 $128.5 4.0x

01/06/14 Microsoft Dynamics Inc Parature, Inc.* $100.0 $20.0 5.0x

01/06/14 Pinterest, Inc. VisualGraph Inc. - - -

01/06/14 ABRY Partners, LLC Inmar, Inc. - - -

01/02/14 Firespring, Inc. Cost Effective Technologies, Inc. - - -

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Software Equity Group is an investment bank and M&A advisory serving the software and technology sectors. Founded in 1992, our firm has guided and advised companies on five continents, including privately-held software and technology companies in the United States, Canada, Europe, Asia Pacific, Africa and Israel. We have represented public companies listed on the NASDAQ, NYSE, American, Toronto, London and Euronext exchanges. Software Equity Group also advises several of the world's leading private equity firms. We are ranked among the top ten investment banks worldwide for application software mergers and acquisitions.

Our value proposition is unique and compelling. We are skilled and accomplished investment bankers with extraordinary software, internet and technology domain expertise. Our industry knowledge and experience span virtually every software product category, technology, market and delivery model, including Software-as-a-Service (Saas), software on-demand and perpetual license. We have profound understanding of software company finances, operations and valuation. We monitor and analyze every publicly disclosed software M&A transaction, as well as the market, economy and technology trends that impact these deals. We're formidable negotiators and savvy dealmakers who facilitate strategic combinations that enhance shareholder value.

Perhaps most important are the relationships we've built and the industry reputation we enjoy. Software Equity Group is known and respected by publicly traded and privately owned software and technology companies worldwide, and we speak with them often. Our Quarterly and Annual Software Industry Equity Reports are read and relied upon by more than thousands of industry executives, entrepreneurs and equity investors in sixty-one countries, and we have been quoted widely in such leading publications as The Wall Street Journal, Barrons, Information Week, The Daily Deal, The Street.com, U.S. News & World Report, Reuters, Mergers & Acquisitions, USA Today, Arizona Republic, Detroit Free Press, Entrepreneur Magazine, Softletter, Software Success, Software CEO Online and Software Business Magazine.

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Software Equity Group is an investment bank and M&A advisory serving the software and technology sectors. For a confidential consultation without obligation, please contact Kris Beible, Director, Business Development (858) 509-2800, [email protected] .

CONTACT INFORMATION:

Software Equity Group, L.L.C.12220 El Camino Real, Suite 320San Diego, CA 92130www.softwareequity.comp: (858) 509-2800

The information contained in this Report is obtained from sources we believe to be reliable, but no representation or guarantee is made about the accuracy or completeness of such information, or the opinions expressed herein. Nothing in this Report is intended to be a recommendation of a specific security or company or intended to constitute an offer to buy or sell, or the solicitation of an offer to buy or sell, any security. Software Equity Group LLC may have an interest in one or more of the securities or companies discussed herein. Financial data provided by Capital IQ.

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