Looking at European SaaS Exits
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Transcript of Looking at European SaaS Exits
D E S I G N I N G Y O U R E X I T S T R AT E G Y : A D ATA - D R I V E N L O O K AT R E C E N T S A A S E X I T S
Private & Confidential | 2
A g e n d a
Introduction
European SaaS Exit Trends
Case Studies
How to achieve your exit?
Introducing ‘Real Exits’
01
02
03
0405
Private & Confidential | 3
I n t r o d u c t i o n
M A R K M A C L E O D
F O U N D E R & P R E S I D E N T S U R E PAT H C A P I TA L PA R T N E R S
Mark has over 14 years experience as a CFO for leading companies such as FreshBooks, Shopify, Tungle and many others. He also spent 3 years as a General Partner at Real Ventures,
Canada’s largest and most active seed stage venture fund.
He has raised hundreds of millions in capital from investors in Canada, the US and Asia. In addition, Mark has sold companies to Airbnb, Blackberry, Rackable Systems, Return Path and
others.
Private & Confidential | 4
S u r e P a t h : O u r P u r p o s eHelping you fund, grow and exit your startup
The process of raising growth capital is very different from raising early stage capital
It is cheaper than ever to start companies, but more expensive than ever to build market leaders. If that’s your aspiration, you need growth capital
We help startups prepare for growth stage and help them raise the capital needed to become market leaders
We have sat on both sides of the table. We have funded, grown and exited many companies
We offer up that experience through ongoing coaching and mentoring.
A low touch, high impact way to help you grow
There are few credible choices for advisors to facilitate sub $100M exits. We fill that gap
We work with you to facilitate the BD and Corp Dev intros that pave the way to an eventual exit
If you decide to exit, we manage the process for you from start to finish
SurePath maximizes your optionality: We make sure you know what it takes to build a market leader and capitalize you towards that goal.
We ensure you are always in the minds of strategic buyers so that if they decide to make a move in your space, you are in the conversation. You can then decide; Keep going or exit?
Growth Funding
Strategic Guidance
Exits
Private & Confidential | 5
S u r e P a t h & S M B
• We have been part of some the most successful SMB SaaS companies • We have deep relationships with SMB investors and buyers • SurePath is committed to becoming the leading strategic financial advisor to the global
SMB software market
European SaaS Acquisition Activity
Private & Confidential | 7
E x i t s b y T y p e
Source: pitchbook.com
19
3024 24
35
2228 27
1520
24
1
11 2
1
1
3
0
5
10
15
20
25
30
35
40
2014Q1 2014Q2 2014Q3 2014Q4 2015Q1 2015Q2 2015Q3 2015Q4 2016Q1 2016Q2 2016Q3
Num
bero
fDeals
European SaaS Exits by Type
Merger/Acquisi=on IPO
Private & Confidential |
Private Buyers
67%
Public Buyers
33%
Buyer by Type
8
B u y e r L o c a t i o n & T y p e
Source: pitchbook.com
North America
41%
Asia & Others 6%
Europe 53%
Buyer By Geography
Private & Confidential | 9
B u y e r sWho’s buying European SaaS companies
Source: pitchbook.com
Private & Confidential | 10
E x i t s b y A g e
Note: 12 companies does not have a disclosed age Source: pitchbook.com
14%
40% 17%
18%
11%
ExitByAgeofCompany
0to5years
6to10years
11to15years
16to20years
>20years
Private & Confidential | 11
E x i t s b y S i z e
Source: pitchbook.com
71%
21%
5% 2% 1%
ExitValues
NotDisclosed
$0m- $50
$50M- $100M
$100M- $200M
>$200M
Private & Confidential | 12
F u n d i n g S t a t u s
Source: pitchbook.com
6%
40%53%
Funding Status of Exited Companies
PE VC Non-funded
$46.7m
$30.0m
$13.1m
$0.0m
$5.0m
$10.0m
$15.0m
$20.0m
$25.0m
$30.0m
$35.0m
$40.0m
$45.0m
$50.0m
PE VC Non-funded
Median Valuation
4.2x3.8x
2.0x
0.0x
1.0x
2.0x
3.0x
4.0x
5.0x
PE VC Non-funded
Valuation /Rev Multiple
Private & Confidential | 13
C O U N T R Y E X I T SU N I T E D K I N G D O M 9 2G E R M A N Y 3 7F R A N C E 3 5N E T H E R L A N D S 1 5I R E L A N D 1 4S PA I N 1 2S W I T Z E R L A N D 9F I N L A N D 8S W E D E N 8I TA LY 7B E L G I U M 6D E N M A R K 6N O R WAY 6R U S S I A 5
C Z E C H R E P U B L I C , P O R T U G A L , C R O AT I A , P O L A N D , A U S T R I A , C Y P R U S , H U N G A R Y, L AT V I A , M A LTA , S E R B I A , S L O VA K I A , U K R A I N E
< 5
E x i t s b y L o c a t i o n
92
37
15
35
14
12
9
8
8
7
6
6
6
5
Case Studies
Private & Confidential |
Endomondo Year Founded 2007
Time To Exit 8 Years
Rounds Raised 3
Total Funding $6.2M
Investor(s)SEED Capital
Denmark
HeadquartersCopenhagen,
Denmark
Employees 33
15
C a s e S t u d y : E n d o m o n d o
Source: pitchbook.com, Endomondo, inc.com, Bloomberg
Acquired By Valuation Date Of Acquisition
$85 Million USD January 2015
• Under Armour bought Endomondo around the same time it acquired MyFitnessPal for $475M USD
• Endomondo was profitable at the time of acquisition • Under Armour acquired Endomondo to understand
European consumers better - with only 8% of revenue outside of America
Private & Confidential |
TextLocal Year Founded 2005
Time To Exit 9 Years
Rounds Raised N/A
Total Funding N/A
Investor(s) N/A
Headquarters Chester, England
Employees 36
16
C a s e S t u d y : Te x t L o c a l
Source: pitchbook.com, Venturebeat, tech.eu
Acquired By Valuation Date Of Acquisition
$16.6 Million USD Oct 2014
• TextLocal’s messaging platform was very complementary to IMImobile’s solutions which utilizes network and mobile data to create streamlined customer journeys
• TextLocal was immediately integrated with IMImobile’s core infrastructure post acquisition - and the platform helped cross-sell IMImobile’s other products
• With IMImobile’s global footprint, it also opened up more markets for TextLocal
• TextLocal also allowed IMImobile to start serving the SMB market, which it did not previous cater to
Private & Confidential |
Wunderlist Year Founded 2010
Time To Exit 5 Years
Rounds Raised 4
Total Funding $24M
Investor(s)Sequoia Capital,
Deutsche Telekom, Atomico
Headquarters Berlin, Germany
Employees 61
17
C a s e S t u d y : Wu n d e r l i s t
Source: pitchbook.com, SeattleTimes, Wunderlist, MIcrosoft, ZDNet
Acquired By Valuation Date Of Acquisition
$150 Million USD June 2015
• While Microsoft has historically focused on building their own major applications, it has shown a preference to buy mobile-first apps that are single feature (i.e. Sunrise, SwiftKey, Acompli, etc.)
• With over 13 million users at the time of acquisition, this was a good channel for Microsoft to be even further embedded into people’s productivity solutions
• Since the acquisition, Microsoft has rolled out integrations between Wunderlist and Microsoft Outlook
• Wunderlist has also introduced more premium, business oriented solutions since the acquisition
How to Achieve Your Exit
Private & Confidential | 19
Exit Rule #1: Be proactive
stop wishing.
start doing.
Private & Confidential | 20
Exit Rule #2: Strangers don’t (often) marry
Private & Confidential | 21
Exit Rule #3: Timing matters
Source: SaaStr
Private & Confidential | 22
Exit rule #4: (Almost) anything is possible
Possibilities
Private & Confidential | 23
Buyer TypesFounder
✓ Product-driven
✓ Based on desire
✓ Top down
✓ No prior relationship needed
Manager
✓ Fact-driven
✓ Based on clear business case
✓ Pushed up to CEO
✓ Need evidence (joint customers)
Private & Confidential | 24
Drivers of Deal Value
✓ Alternatives (runway, competition)
✓ Scarcity
✓ Mortal enemies
✓ Growth (fear)
✓ Market leadership (2 way)
✓ Does the buyer’s CEO Want this?
✓ On strategy
✓ Currency
✓ Time and timing (including markets)
Private & Confidential |
T h e R o l e o f A d v i s o r s
25
✓ Should you hire one? Yes
✓ What to look for: Relevant relationships, completed deals and expertise.
Senior people involved
✓ Role:
✓ Prepare you
✓ Quarterback
✓ Create / manage demand
✓ Good cop/ bad cop
✓ Objectivity
✓ Create urgency
Private & Confidential | 26
I n t r o d u c i n g R e a l E x i t s
Shubham Datta Associate
[email protected] 647.972.6834
Rena Wang Analyst
[email protected] 416.897.8922
Mark MacLeod Founder & President
[email protected] 416.843.6004