2. 2
0
100
200
300
400
500
600
SaaS and Internet Outpacing the Market
S&P 500 NASDAQ SaaS Peer Group Internet Peer Group
The Market Conditions are Robust…
93%YoY increase in 1H13
Technology M&A deal value
61IPOs raising $13Bnof
proceeds in 2Q13
74%and 43%YTD
increase in SaaS Software and
Internet indices respectivelyJan 09 July 13
3. 3
…Driven by Growing Confidence
62%of S&P 500 beat Q2 earnings estimates –
highest since 3Q11
$1.5Tof Cash in corporate coffers
14.2VIX Average (1H13) -- lowest since 2007
High Business Confidence
Strong Balance Sheets
Lower Volatility
6. 6
How Do You Achieve Premium Valuation?
Massive, often untapped markets
Ability to achieve sustainable, long-term growth
Engagement
Talent
Build v. Buy
Defensive &
Strategic
Technology
Exponential growth in traffic and deep engagement
New paradigms leveraging mobile devices
Visionary teams creating new markets
Ability to understand generational shifts
Rapid market share gain
Time to market critical
Existing business model in massive emerging market
Threat to market share if competitors own
Next generation technologies
Re-inventing consumer engagement modality
Size of Market
What Is It Worth to You? Sell v. Build
8. 8
Deal Considerations
Structure
Stock v. Cash
Earnouts
Management &
Employees
Interests &
Perspectives
Board
Founder
Investors
“Tech” Companies
Are Bought Not Sold
Marketing
Using financing as
a trigger
14. 14
Year Target Buyer Sector
Transaction
Value LTM Revenue
TV / LTM
Revenue
9/9/2013 MoPub Twitter Internet - Commerce $350 NA 3.5 x
6/11/2013 Waze Google Internet - Mobile $966 NA NM
6/3/2013 ExactTarget Salesforce.com SaaS - Marketing $2,351 $317 7.4 x
5/20/2013 Tumblr Yahoo! Internet - Social $1,100 NA 13.0 x
11/23/2012 Eloqua Oracle SaaS - Marketing $958 $90 10.6 x
10/21/2012 Ancestry.com Private Investors Internet - Social $1,609 $460 3.5 x
8/25/2012 Kenexa Corp. IBM SaaS - HR $1,397 $318 4.4 x
5/31/2012 Buddy Media Salesforce.com SaaS - Marketing $745 $29 26.0 x
5/22/2012 Ariba SAP America SaaS - Commerce $4,608 $502 9.2 x
4/9/2012 Instagram Facebook Internet - Social $1,000 NA NA
2/8/2012 Taleo Oracle SaaS - HR $1,921 $315 6.1 x
12/2/2011 SuccessFactors SAP America SaaS - HR $3,764 $292 12.9 x
10/23/2011 Rightnow Technologies Oracle SaaS - CRM $1,763 $216 8.2 x
7/11/2011 PopCap Games Electronic Arts SaaS - CRM $1,301 NA NA
6/15/2012 Yammer Microsoft Internet - Social $1,200 NA NA
5/10/2011 Skype Microsoft Internet - Communications $9,325 $860 10.8 x
12/31/2012 SurveyMonkey.com Google SaaS - Marketing $794 NA NA
5/24/2012 PowerReviews Bazaarvoice SaaS - Commerce $128 $12 10.7 x
8/15/2012 Getty Images The Carlyle Group Internet - Media $3,300 NA NA
3/5/2012 Amobee Singapore Telecommunications SaaS - CRM $321 NA NA
Mean $1,945 $310 9.7 x
Median $1,251 $315 9.2 x
Valuation of Hot M&A Comps