Software Valuation and M&A Report Q3 2016

Q3

20

16

SEG Capital Advisors, L.L.C.

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(858) 509-2800

The Software Industry

Financial Report

SOFTWARE EQUITY GROUP | Q3 2016 SOFTWARE INDUSTRY FINANCIAL REPORTCopyright © SEG Capital Advisors, LLC, All Rights Reserved 2

About Software Equity GroupAbout SEG 5SEG’s 2016 Transaction Announcements 6Leaders in Software M&A 7

Public SaaS Company Financial and Valuation PerformanceThe SEG SaaS Index 9The SEG SaaS Index: Financial Performance 10-12The SEG SaaS Index: Public Market Multiples 13-15The SEG SaaS Index by Product Category: Financial Performance 16

Public Software Financial and Valuation PerformanceThe SEG Software Index 18The SEG Software Index: Financial Performance 19-21The SEG Software Index: Public Market Multiples 22-23The SEG Software Index by Product Category 24The SEG Software Index by Product Category: Financial Performance 25-26

Public Internet Company Financial and Valuation PerformanceThe SEG Internet Index 28The SEG Internet Index: Financial Performance 29-31The SEG Internet Index: Public Market Multiples 32-33The SEG Internet Index by Product Category 34The SEG Internet Index by Product Category: Financial Performance 35-36

SOFTWARE INDUSTRY FINANCIAL REPORT CONTENTS


SOFTWARE INDUSTRY FINANCIAL REPORT CONTENTS

SaaS/Software Industry M&A Market UpdateSoftware/SaaS M&A Deal Volume and Spending 38SaaS M&A Deal Volume and Exit Multiples 39-41SaaS M&A by Product Category 42SaaS M&A 3Q16 Transactions 43-47Software M&A Exit Multiples 48Software M&A by Ownership Structure and Size 49Software M&A by Vertical and Horizontal Markets 50Software M&A Deal Volume by Product Category 51Software M&A Exit Multiples by Product Category 52About Software Equity Group 53

AppendixThe SEG SaaS Index: Public Market Multiples (Annual) 55The SEG SaaS Index: Financial Performance (Annual) 56The SEG Software Index: Public Market Multiples (Annual) 57The SEG Software Index: Financial Performance (Annual) 58The SEG Internet Index: Public Market Multiples (Annual) 59The SEG Internet Index: Financial Performance (Annual) 60SEG SaaS Index Key Metrics 61-62SEG SaaS Index Key Metrics by Product Category 63SEG Software Index Key Metrics 64-67SEG Software Index Key Metrics by Product Category 68-69SEG Internet Index Key Metrics 70-72SEG Internet Index Key Metrics by Product Category 733Q16 Select Public Sellers 743Q16 Mega Deals 753Q16 Most Active Buyers 76

SOFTWARE EQUITY GROUP | Q3 2016 SOFTWARE INDUSTRY FINANCIAL REPORTCopyright © SEG Capital Advisors, LLC, All Rights Reserved

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THE SEG SOFTWARE INDUSTRY FINANCIAL REPORT

PUBLIC SaaS COMPANY FINANCIAL PERFORMANCE AND MARKET MULTIPLE TRENDS


THE SEG SaaS INDEX

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

9

SEG - SaaS: Median Metrics

Measure 3Q15 4Q15 1Q16 2Q16 3Q16

EV/TTM Revenue 6.2x 5.8x 3.9x 4.3x 5.1x

EV/NTM Revenue 4.4x 4.6x 3.4x 3.8x 4.2x

EV/TTM EBITDA 44.0x 34.6x 30.3x 38.9x 41.2x

EV/TTM CFO 39.6x 42.7x 25.5x 33.6x 35.6x

Gross Profit Margin 64.6% 65.8% 66.3% 66.0% 66.2%

EBITDA Margin -9.1% -7.9% -6.0% -6.7% -5.4%

Net Income Margin -17.0% -14.9% -16.8% -15.1% -13.2%

TTM Revenue Growth 29.0% 27.2% 28.9% 29.2% 29.0%

TTM Total Revenue ($M) $159.8 $171.0 $187.7 $199.8 $212.4

TTM EBITDA Growth 18.5% 29.9% 22.4% 24.2% 24.4%

TTM Total EBITDA ($M) -$8.6 -$8.6 -$11.5 -$9.8 -$8.4

Cash & Eq ($M) $103.1 $110.0 $104.6 $100.6 $95.6

• The SEG SaaS Index tracks public companies that primarily offerhosted, on-demand software under a subscription and/or transactionbased pricing model. It is currently comprised of 66 publicly tradedpure-play SaaS companies.

• Three companies in SEG’s SaaS Index announced an intent to beacquired during the third quarter, while five new companies enteredour index due to IPO.

• See appendix for SEG SaaS Index public market multiples andfinancial performance on an annual basis.


2%

8%

17%

25%

17%

10%

20%

3%

14%12%

24%

18%

12%

17%

<= 0% > 0%<= 10%

> 10%<= 20%

> 20%<= 30%

> 30%<= 40%

> 40%<= 50%

> 50%

% o

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om

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TTM Revenue Growth

3Q15

3Q16

THE SEG SaaS INDEX: FINANCIAL PERFORMANCE

10

TTM Revenue Growth Rate DistributionMedian Revenue Performance - Quarterly

$159.8

$171.0$187.7 $199.8

$212.4

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%

35.0%

$0

$50

$100

$150

$200

$250

3Q15 4Q15 1Q16 2Q16 3Q16

TT

M R

ev

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Gro

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TT

M T

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TTM Total Revenue ($M) TTM Revenue Growth

• The median TTM revenue growth rate of public SaaS companies in3Q16 was 29.0%, on par with 3Q15, and roughly equivalent to thepast two quarters. Median TTM revenue of public SaaS companies was$212.4 million in 3Q16, a 32.9% YOY increase when compared to3Q15’s $159.8 million median TTM revenue figure.

• Median growth rates alone do not capture the standout performancesof the most successful SaaS companies. In 3Q16, 29.0% of public SaaScompanies grew TTM revenue by 40% or more year over year,compared with only 10% percent of public on-premise softwareproviders achieving growth of 40% or greater. As further testamentto the widespread and ramping adoption of SaaS, these outperformerscome from a variety of product categories including eCommerce,Business Intelligence / Analytics, Customer Support / Helpdesk andHuman Capital Management.


61%

14%12%

9%

4%

53%

22%

14%

5% 5%

<= 0% > 0%<= 10%

> 10%<= 20%

> 20%<= 30%

> 30%

% o

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TTM EBITDA Margin

3Q15

3Q16


11

TTM EBITDA Margin DistributionMedian EBITDA Margin Performance - Quarterly

(9.1%)

(7.9%)

(6.0%) (6.7%)

(5.4%)

3Q15 4Q15 1Q16 2Q16 3Q16

EB

ITD

A M

arg

in

• The median EBITDA margin for public SaaS companies was -5.4% in3Q16 and has been generally trending toward positive territory since4Q14.

• While the majority of public SaaS companies continue to post GAAPlosses (53% of our index in Q3) due to significant levels of deferredrevenue, more than two thirds of public SaaS companies generatedpositive cash flow from operations in Q3.

• Select Public SaaS companies posting negative EBITDA Margin whilegenerating positive cash flow from operations during Q3 include:Hubspot (-18.1% EBITDA Margin, $10.6M CFO); Tableau (-11.3%EBITDA Margin, $142.2M CFO); Shopify (-7.4% EBITDA Margin,$11.3M CFO); Workday (-15.5% EBITDA Margin, $318.9M CFO);Zendesk (-29.8% EBITDA Margin, $14.7M CFO).



12

Median Margin PerformanceMedian Operating Ratios

64.6% 65.8% 66.3% 66.0% 66.2%

-9.1% -7.9%-6.0% -6.7% -5.4%

-17.0% -14.9% -16.8% -15.1%-13.2%

3Q15 4Q15 1Q16 2Q16 3Q16

% M

arg

in

Gross Profit Margin EBITDA Margin Net Income Margin

39.4%37.7% 38.4% 37.8% 36.9%

18.4% 18.3% 18.7% 18.7% 18.6%18.0% 18.6%17.9% 17.9% 16.9%

3Q15 4Q15 1Q16 2Q16 3Q16

% o

f R

ev

en

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

• Public SaaS companies continue to spend heavily on sales & marketing in order to drive revenue growth and capture market share. In 3Q16, public SaaScompanies invested a median 36.9% of total revenue on sales & marketing, almost double their on-premise counterparts. Sales and marketing spend as apercent of revenue has remained in the high 30% range since dipping below 40% in 3Q15. R&D spend as a percent of revenue held relatively flat year overyear (18.6% in 3Q16 vs. 18.4% in 3Q15).

• Median EBITDA and Net Income margins have generally trended toward positive territory over the past year, along with a slight rise in median grossprofit margin (66.2% in 3Q16).


5%

12% 12%

5%

12%

6%

12%

5% 6%

25.0%

6%

9%8%

13%

9%11% 11%

5%

8%

20%

<= 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

3Q15

3Q16

THE SEG SaaS INDEX: PUBLIC MARKET MULTIPLES

13

EV/Revenue Multiple DistributionMedian EV/Revenue and EV/EBITDA - Quarterly

6.2x 5.8x3.9x 4.3x 5.1x

44.0x

34.6x

30.3x

38.9x41.2x

3Q15 4Q15 1Q16 2Q16 3Q16

EV/TTM Revenue EV/EBITDA

• At the close of 3Q16, the median market multiple of public SaaS companieswas 5.1x EV/Revenue, a healthy uptick from the prior two quarters, but down17% when compared to 3Q15’s 6.2x median EV/Revenue.

• In 3Q16, 20% of public SaaS companies achieved a median EV/Revenuemultiple of 9x or higher, down from 25% YoY, but significantly higher than2Q16 and 1Q16, when only 11% and 5% of the public SaaS index was valuedat 9.0x or higher, respectively. Investor sentiment towards these public SaaScompany “high fliers” has clearly turned more bullish as the markets haverebounded from 1Q16’s precipitous drop.

• Investors and larger strategic buyers have taken note of softer public SaaSvaluations when compared to recent years past. Following Q2’s record sevenpublic SaaS companies announcing an intent to be acquired by either strategicbuyers or private equity firms, another four public SaaS companies were thetargets of acquisition during Q3. The list includes: Netsuite’s intendedpurchase by Oracle; Apigee’s purchase by Google; Fleetmatic’s purchase byVerizon; and QHR’s purchase by Loblaw. Please reference slides 39-42 foradditional SaaS M&A transaction detail.



14

EV/Revenue Multiples vs. TTM EBITDA Margins

0.0x

2.2x 2.2x

5.2x

6.5x

10.2x11.1x

0.6x1.5x

3.3x

5.3x

6.3x5.8x

9.9x

<= 0% > 0%<= 10%

> 10%<= 20%

> 20%<= 30%

> 30%<= 40%

> 40%<= 50%

> 50%

Me

dia

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V/

Re

ve

nu

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TTM Revenue Growth

3Q15

3Q16

6.2x

3.0x

4.4x

8.2x

5.0x5.5x

4.1x4.5x

7.0x 7.0x

<= 0% > 0%<= 10%

> 10%<= 20%

> 20%<= 30%

> 30%

Me

dia

n E

V/

Re

ve

nu

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TTM EBITDA Margin

3Q15

3Q16

EV/Revenue Multiples vs. TTM Revenue Growth

• The highest growth SaaS companies received a median 9.9x EV/Revenue multiple in 3Q16, a healthy increase over 2Q16’s 7.2x median multiple, but still down whencompared to 3Q15’s 11.1x median EV/Revenue multiples.

• The YoY decline in median EV/Revenue for this high growth cohort can be attributed to:

• 1) A general decline in public SaaS valuations year over year as macro economic concerns and an election year have some investors fleeing high growth small capSaaS stocks. This trend has abated somewhat in the third quarter as SaaS valuations overall have improved.

• 2) Those companies posting significant growth at any cost have fallen out of favor with investors. As an example, Hortonworks posted a median 11.9x TTMrevenue multiple in 3Q15 on the back of 106.4% revenue growth, but negative 266.4% EBITDA margin and negative $108.6 million CFO. During 3Q16, thecompany grew revenue 99%, generated negative 140.9% EBITDA margin and negative $98.4 million CFO, and posted median 2.7x EV/Revenue.

• 3) 50%+ growth SaaS businesses from 3Q15 that have seen revenue growth fall under 50% in 3Q16 were due, predominantly, to either size or increasedcompetitive pressure. Tableau has seen its revenue growth and multiple fall from 71.4% and 12.4x EV/Revenue in 3Q15, respectively, to 41.0% and 4.4xEV/Revenue, in 3Q16 respectively, as competitive pressures across business intelligence, analytics, and big data heat up.

• The most profitable SaaS companies posted a median 7.0x EV/Revenue multiple during 3Q16, a roughly 40% premium over the Index median 5.1x EV/Revenue. Incomparison, the same cohort received a 5.0x EV/Revenue multiple in 3Q15, which equated to a ten percent discount to that quarters 6.2x Index median.


Company TickerEV

(Median)TTM

Revenue

TTM Revenue Growth

EV/Revenue

TTM EBITDA

EBITDA Margin

EV/EBITDA

Twilio, Inc. TWLO $4,258.4 $219.5 79.1% 19.4x -$30.5 -13.9% -

NantHealth, Inc. NH $1,565.5 $85.8 97.8% 18.3x -$123.3 -143.8% -

Atlassian Corp TEAM $5,636.2 $457.1 43.0% 12.3x $8.6 1.9% 652.3x

Nutanix, Inc NTNX $5,255.0 $444.9 84.3% 11.8x -$138.6 -31.2% -

Shopify SHOP $3,146.9 $282.3 95.0% 11.1x -$20.8 -7.4% -

Workday WDAY $14,798.8 $1,351.8 38.7% 10.9x -$208.9 -15.5% -

Ellie Mae ELLI $3,110.1 $297.5 42.0% 10.5x $53.7 18.1% 57.9x

Netsuite N $8,682.4 $846.4 31.5% 10.3x -$59.1 -7.0% -

Paycom Software PAYC $2,904.4 $284.5 53.9% 10.2x $67.1 23.6% 43.3x

Veeva Systems VEEV $4,776.1 $472.3 31.6% 10.1x $91.4 19.4% 52.2x

Zendesk ZEN $2,587.2 $261.0 60.2% 9.9x -$77.8 -29.8% -

Service-now.com NOW $11,789.7 $1,194.0 42.9% 9.9x -$91.5 -7.7% -

Paylocity Holding PCTY $2,190.0 $230.7 51.1% 9.5x $4.9 2.1% 449.0x

The Ultimate Software Group ULTI $6,006.6 $699.7 26.1% 8.6x $66.3 9.5% 90.5x

2U TWOU $1,452.8 $176.9 37.1% 8.2x -$21.5 -12.2% -

The Trade Desk TTD $1,223.3 $149.0 - 8.2x $47.1 31.6% 26.0x

HubSpot HUBS $1,844.5 $224.8 54.3% 8.2x -$40.8 -18.1% -

Zix ZIXI $195.0 $57.6 10.9% 3.4x $10.6 18.5% 18.3x

HealthStream HSTM $689.0 $218.6 15.5% 3.2x $24.5 11.2% 28.1x

HortonWorks HDP $413.1 $154.7 99.0% 2.7x -$218.0 -140.9% -

TrueCar TRUE $698.2 $264.3 12.0% 2.6x -$34.1 -12.9% -

DealerTrack TRAK $91.9 $36.9 43.7% 2.5x $5.9 16.1% 15.5x

ChannelAdvisors ECOM $266.7 $107.3 17.1% 2.5x -$7.4 -6.9% -

Upland Software UPLD $174.1 $70.9 4.3% 2.5x $3.3 4.6% 53.0x

IntraLinks Holdings IL $562.6 $284.5 6.1% 2.0x $14.4 5.1% 39.1x

Halogen Software TSX:HGN $120.6 $69.4 12.8% 1.7x $0.3 0.5% 361.0x

LivePerson LPSN $387.7 $232.1 0.8% 1.7x $15.5 6.7% 25.0x

Bazaarvoice BV $293.3 $201.0 3.6% 1.5x -$9.8 -4.9% -

Tangoe TNGO $297.5 $219.4 5.7% 1.4x $9.6 4.4% 30.9x

Jive Software JIVE $212.6 $201.7 6.2% 1.1x -$13.7 -6.8% -

Covisint COVS $47.9 $75.0 -12.2% 0.6x -$9.8 -13.0% -

Medical Transcript MTBC $12.2 $21.3 -15.6% 0.6x -$1.1 -5.4% -

Marin Software MRIN $61.1 $108.3 2.3% 0.6x -$8.4 -7.7% -


Top 25%

Bottom 25%

15

• When the SEG SaaS Index is segmented on the basis ofmedian EV/Revenue multiple, the top 25% boasted animpressive median 10.2x in 3Q16, up from 2Q16’s 8.8xmultiple, yet down slightly from 3Q15’s 11.5x mark.

• These SaaS high flyers are market leaders in a widearray of SaaS categories including Healthcare(NantHealth); Communications (Twilio); DevelopmentTools (Atlassian); ERP (Workday); ServiceManagement (ServiceNow); Human CapitalManagement (Paycom); Marketing Automation(Hubspot); eCommerce (Shopify); and CRM &Marketing (HubSpot).

• The median TTM revenue growth rate of those in thetop 25% percentile was 47.1%. Additionally, whileonly seven companies in the top rank generatedpositive EBITDA margin in 3Q16, 14 of the 17companies generated positive cash flow fromoperations. Only NantHealth. 2U, and Twilio postednegative CFO.

• In contrast, the median TTM revenue growth rate ofthose comprising the bottom 25% of EV/Revenuemultiples was 6.2%. In addition to lagging revenuegrowth, the bottom quartile posted median EBITDAmargin of .5% and only 11 of 17 companies generatedpositive CFO. Median EV/Revenue for the group was3.4x in 3Q16.


THE SEG SaaS INDEX BY PRODUCT CATEGORY:FINANCIAL PERFORMANCE (YOY COMPARISON)

16

Median TTM EBITDA MarginMedian TTM Revenue Growth

Median EV/Revenue Multiples Median EV/EBITDA Multiples

5.7x5.6x

6.6x6.0x

5.4x

6.4x

7.4x

6.6x

CRM & MarketingERP & SupplyChain

Vertically FocusedHuman CapitalManagement

25.1%

22.2%

36.4%

29.5%

25.3%27.0%

35.9%33.6%



(4.9%)(7.0%)

9.7%

0.2%

(10.5%)(9.1%)

8.0%

(9.6%)



96.2x

32.7x34.2x

90.5x

149.4x

24.3x

40.8x

52.6x




THE SEG SOFTWARE INDEX

PUBLIC SOFTWARE COMPANY FINANCIAL PERFORMANCE AND MARKET MULTIPLE TRENDS


SEG - Software: Median Metrics

Measure 3Q15 4Q15 1Q16 2Q16 3Q16




EV/TTM CFO 15.6x 15.9x 15.6x 16.4x 17.8x


EBITDA Margin 17.8% 17.5% 17.9% 16.9% 16.5%

Net Income Margin 7.7% 6.8% 8.2% 6.9% 7.6%




TTM Total EBITDA ($M) $89.3 $80.1 $93.4 $93.5 $103.3

Cash & Eq ($M) $231.3 $244.5 $246.2 $227.0 $251.3

18

THE SEG SOFTWARE INDEX

* A number of on-premise software companies are transitioning to subscription based delivery and pricing models; however their SaaS revenue contribution is insufficient for them to be deemed primarily SaaS. ** See appendix for a complete list of companies in The SEG Software Index and detailed financial and trading metrics

• The SEG Software Index tracks public software companies thatprimarily offer on-premise software under a perpetual license withannual M&S.

• The SEG Software Index is currently comprised of 126 publicsoftware companies*, down from 218 in 1Q08 (the quarter in whichwe began publishing individual Software, SaaS and Internet indices).

• The number of public companies comprising the SEG Software Indexhas declined steadily over the past ten years, as many on premiseproviders have been acquired, taken private or migrated to a SaaSbusiness model.

• See appendix for SEG Software Index public market multiples andfinancial performance on an annual basis


24%

35%

21%

9%

4%

7%

27% 27%

22%

7% 6%

10%

<= 0% > 0%<= 10%

> 10%<= 20%

> 20%<= 30%

>30%<=40%

>40%

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TTM Revenue Growth

3Q15

3Q16

THE SEG SOFTWARE INDEX: FINANCIAL PERFORMANCE

19


$597.3 $609.5$668.4 $680.1 $682.5

6.0%

6.5%

7.0%

7.5%

8.0%

8.5%

$0

$100

$200

$300

$400

$500

$600

$700

$800

3Q15 4Q15 1Q16 2Q16 3Q16

TT

M R

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Gro

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TT

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• The median TTM revenue growth rate of public on-premise softwarecompanies was 7.8% in 3Q16 and is approaching 3Q15’s 8.0% mark,after falling to 6.6% in the fourth quarter of last year. With 54% ofpublic on-premise software providers posting revenue growth of lessthan 10% in 3Q16, SEG’s Software Index has now experienced singledigit median TTM revenue growth since 3Q13.

• The few public on-premise software companies growing revenue at30%+ were focused on two of IT’s hottest product categories: security(Palo Alto Networks, 48.5% and Rapid7, 45.4%) and datamanagement (Splunk, 47.6%).

• Median TTM revenue for the publicly traded on-premise softwareproviders was $682.5 million in 3Q16, an increase of 14.2% from3Q15’s $597.3 million. In comparison, median TTM revenue for ourSaaS Index grew 32.9% over the same period ($212.4 million in 3Q16vs. 159.8 million in 3Q15).


16%

13%

23%

29%

13%

5%

20%

13%

24%

26%

13%

5%

<= 0% > 0%<= 10%

> 10%<= 20%

> 20%<= 30%

> 30%<= 40%

> 40%

% o

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TTM EBITDA Margin

3Q15

3Q16


20

TTM EBITDA Margin DistributionMedian EBITDA Performance - Quarterly

17.8% 17.5% 17.9%16.9% 16.5%

3Q15 4Q15 1Q16 2Q16 3Q16

EB

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• Median TTM EBITDA margin for the SEG Software Index has hoveredaround 17% for the past five quarters. Buoyed by high marginmaintenance and support streams from long tenured customers, many on-premise providers have been able to maintain healthy profits whileattempting to fend off cloud competition.

• For example, Microstrategy, a provider of on-premise businessintelligence software, posted negative 7.5% revenue growth in3Q16 while maintaining 25.0% EBITDA margin, as it counts over50% of its revenue from highly profitable maintenance andsupport contracts. Over its three most recent fiscal years,Microstrategy has seen net revenue from license sales decline by$28 million to reach $119 million, net revenue from subscriptionsales increase by $16 million to reach $28 million, net revenuefrom services decrease $37 million to reach $101 million and netrevenue from maintenance contracts increase $4 million to reach$282 million. Microstrategy has a tough road ahead as the markethas been flooded with new cloud BI and analytics vendors inrecent years.



21


23.5% 23.9% 23.8% 24.0% 24.4%

15.8% 15.8% 15.8%16.0% 16.1%

10.9% 10.7% 10.9% 10.7% 10.9%

3Q15 4Q15 1Q16 2Q16 3Q16

% o

f R

ev

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65.5% 65.2% 64.8% 64.4% 64.3%

17.8% 17.5% 17.9% 16.9% 16.5%

7.7% 6.8%8.2%

6.9% 7.6%

3Q15 4Q15 1Q16 2Q16 3Q16

% M

arg

in


• As a percent of revenue, on-premise software companies spent a median 24.4% of revenue on sales and marketing activities, 16.1% on research anddevelopment and 10.9% on general and administrative functions in 3Q16. Expense contributions for on-premise software providers have remainedvirtually unchanged each of the past five quarters.

• In aggregate, median operating expenses totaled 51.4% of revenue during 3Q16 for publicly traded on-premise software providers. In comparison,publicly traded SaaS companies spent 75.8% of revenue on operations during the quarter.


THE SEG SOFTWARE INDEX: PUBLIC MARKET MULTIPLES

22

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

3.3x 2.9x 2.5x 2.7x 3.0x

15.8x15.0x

14.2x15.5x

16.1x

3Q15 4Q15 1Q16 2Q16 3Q16

Me

dia

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ipe


0.0x

1.0x

2.0x

3.0x

4.0x

5.0x

3Q15 4Q15 1Q16 2Q16 3Q16

Me

dia

n E

V/

Re

ve

nu

e

Revenue Greater Than $1 billionRevenue Between $500 million & $1 billionRevenue Between $100 million & $500 millionRevenue Less Than $100 million

• During 3Q16, the median EV/Revenue multiple for on-premisesoftware providers increased across most size cohorts as the softwareindustry continued to rebound from Q1’s stock market turmoil. As inquarters past, however, scale and profitability played a significantrole in ascribing value to slower growth software companies:

• $1 billion+ TTM revenue companies received a median 3.7xTTM revenue and posted median 23.5% EBITDA margin;

• $500-$1 billion revenue companies were valued at median3.0x TTM revenue and posted median 18.5% EBITDA margin;

• $100-$500 million revenue companies were valued atmedian 2.7x TTM revenue and posted median 10.2% EBITDAmargin;

• Companies generating revenue of less than $100 millionwere valued at median 1.7x TTM revenue and posted mediannegative 0.5% EBITDA margin.

• The median EV/Revenue market multiple for public on-premisesoftware providers was 3.0x in 3Q16.

• The 2.5-3.5x median EV/Revenue multiple that’s prevailed over thepast five quarters, despite lackluster growth, reflects the importanceof stability and profitability to investors in the current market.

• For the remainder of 2016, we believe investors will continue to findcomfort in the many profitable and large companies comprising SEG’sSoftware Index as a hedge against global economic concerns, slowerprojected IT spend and an election year.

• Over 80% of companies in SEG’s Software Index generatedpositive EBITDA margin in Q3, along with nearly half ofcompanies in the index generating revenue greater than onebillion dollars.


1.0x

1.6x2.0x

3.5x3.9x

7.2x

1.9x1.6x

2.6x

3.5x

4.6x

7.2x

<= 0% > 0%<= 10%

> 10%<= 20%

> 20%<= 30%

> 30%<= 40%

> 40%

Me

dia

n E

V/

Re

ve

nu

e

TTM EBITDA Margin

3Q15

3Q162.2x

2.5x

4.1x

3.1x

9.4x

2.2x

3.2x2.9x

4.3x4.8x

<= 0% > 0%<= 10%

> 10%<= 20%

> 20%<= 30%

>30+

Me

dia

n E

V/

Re

ve

nu

e

TTM Revenue Growth

3Q15

3Q16

THE SEG SOFTWARE INDEX: PUBLIC MARKET MULTIPLES

23

EV/Revenue Multiples vs. TTM EBITDA MarginsEV/Revenue Multiples vs. TTM Revenue Growth

• The market performance of on-premise public software companiesremains closely correlated with their ability to sustainably driveprofits, as a select group of companies able to generate significantrevenue growth in Q3 were only modestly rewarded (4.8xEV/Revenue) when compared with the same cohort in 3Q15 (9.4xEV/Revenue.

• Members of Q3’s 30%+ growth club that rewarded investorshandsomely during the quarter came from a number of productcategories, including Business Intelligence, Security and NetworkPerformance Management: Splunk (47.6% TTM revenue growth, 9.7xEV/Revenue), Palo Alto Networks (48.5% TTM revenue growth, 10.5xEV/Revenue), and Proofpoint (37.5% TTM revenue growth, 7.5xEV/Revenue).

• As in past quarters, the median market multiples of on-premisesoftware companies generally reflected their median operatingmargins. The most profitable companies posted a 7.2x EV/Revenuemultiple in 3Q16, on par with 3Q15 and 140% above Q3’s 3.0xmedian EV/Revenue multiple for all on-premise software vendors.

• On-premise providers with EBITDA margins greater than 40% can befound in product categories requiring high technical barriers to entryor provide products difficult to deploy via the cloud.

• As an example, engineering simulation and optimizationsolutions developed by Aspen Technology are highlytechnical and not easily deployed through a browser. Thecompany has consistently maintained double digit revenuegrowth and 40%+ EBITDA margin each of the last 5 quarters,posting 20.5% growth and 47.0% EBITDA margin in 3Q16.


THE SOFTWARE INDEX BY PRODUCT CATEGORY

*The SEG Software Index is segmented into 16 product categories.

*Among these product categories, market multiples, TTM growth rates and EBITDA margins fluctuate considerably from quarter to quarter due to public market conditions and investor sentiment.

*See Appendix for the complete list of companies within each product category.

SEG Software Index

CategoryEV/Revenue EV/EBITDA TTM Revenue Growth EBITDA Margin

3Q15 4Q15 1Q16 2Q16 3Q16 3Q15 4Q15 1Q16 2Q16 3Q16 3Q15 4Q15 1Q16 2Q16 3Q16 3Q15 4Q15 1Q16 2Q16 3Q16

Billing & Service Management 1.9x 1.7x 2.0x 2.0x 1.9x 9.2x 9.8x 8.8x 10.9x 9.7x 3.1% -0.4% 0.2% 0.6% 1.8% 27.2% 23.9% 21.2% 22.1% 21.8%

Business Intelligence 3.5x 3.0x 2.8x 3.0x 3.5x 18.2x 15.5x 13.5x 12.3x 14.4x 10.3% 7.0% 13.6% 13.1% 10.4% 18.5% 17.2% 14.9% 15.2% 15.3%

Development Platforms 2.4x 2.3x 2.7x 2.8x 2.3x 8.9x 8.4x 9.1x 9.1x 12.8x 10.6% 11.5% 11.1% 10.2% 10.4% 19.0% 18.6% 18.0% 17.5% 17.1%

Engineering & PLM 3.4x 3.5x 3.3x 3.9x 3.2x 17.1x 16.9x 15.6x 17.0x 16.8x 8.4% 7.5% 0.7% 1.3% 2.1% 22.9% 22.4% 19.3% 17.6% 17.6%

Enterprise Resource Planning 4.1x 4.0x 3.9x 4.1x 3.8x 15.1x 15.1x 16.0x 14.8x 15.5x 4.8% 6.1% 4.8% 3.6% 3.6% 26.7% 27.1% 26.9% 26.7% 26.7%

Financial & Accounting 4.1x 3.9x 3.3x 3.0x 3.8x 15.3x 15.9x 15.9x 16.6x 15.6x 5.4% 4.7% 4.8% 4.1% 6.1% 22.3% 22.6% 24.9% 24.2% 24.2%

Gaming 1.5x 2.5x 2.3x 2.4x 1.3x 14.7x 16.4x 14.3x 18.2x 13.3x 8.4% 4.0% 5.8% 5.8% 12.4% 14.8% 15.6% 21.7% 21.5% 22.5%

Healthcare 2.4x 2.2x 2.0x 2.3x 2.1x 18.5x 14.9x 15.4x 17.2x 15.5x 4.6% 3.8% 2.0% 10.9% 18.9% 12.3% 12.7% 12.5% 14.6% 13.5%

IT Conglomerates 3.2x 4.0x 3.9x 4.0x 3.5x 8.8x 9.8x 9.6x 10.5x 10.8x -1.1% -3.5% -4.3% -3.1% -2.3% 31.1% 31.0% 27.5% 27.7% 28.2%

Mobile Solutions/Content 1.8x 1.6x 1.5x 1.8x 1.8x 15.8x 18.2x 25.2x 19.7x 20.8x 25.5% 19.4% 17.3% 13.1% 13.3% -3.5% 0.4% -0.2% -1.5% -0.8%

Networking & Network Performance Management

2.2x 2.5x 1.9x 1.8x 2.1x 13.1x 11.7x 9.8x 10.9x 13.3x 4.3% 4.9% 5.0% 6.4% 4.6% 19.6% 18.0% 14.2% 9.3% 10.2%

Security 4.2x 3.5x 3.3x 3.0x 3.7x 15.8x 12.4x 12.4x 13.3x 15.3x 8.8% 16.2% 29.5% 17.4% 21.2% 1.6% 1.1% 2.6% 5.0% 4.7%

Storage, Data Management & Integration

2.2x 2.3x 2.1x 2.4x 2.1x 8.0x 8.4x 8.1x 7.1x 7.8x 1.5% 3.8% 3.1% -0.9% 0.9% 4.7% 2.3% 1.4% 2.2% 2.7%

Systems Management 4.7x 3.8x 2.9x 3.1x 3.4x 19.1x 17.1x 13.2x 13.9x 16.1x 5.6% 11.5% 10.1% 8.7% 7.8% 23.8% 22.1% 25.9% 26.1% 26.9%

Vertical - Finance 4.4x 4.8x 5.0x 5.0x 4.1x 13.3x 13.7x 14.5x 16.0x 13.6x 7.1% 6.6% 7.4% 7.6% 7.8% 34.2% 32.7% 32.9% 32.7% 31.7%

Vertical - Other 4.9x 5.1x 4.5x 4.5x 4.3x 30.5x 29.3x 19.3x 19.4x 19.7x 14.1% 12.5% 13.9% 18.2% 17.5% 13.8% 14.9% 16.4% 15.2% 16.6%

Median 3.3x 2.8x 2.5x 2.7x 3.0x 15.8x 15.0x 14.2x 15.3x 15.9x 8.0% 6.6% 7.6% 7.7% 7.8% 17.8% 17.5% 17.9% 16.9% 16.5%


THE SEG SOFTWARE INDEX BY PRODUCT CATEGORY:FINANCIAL PERFORMANCE (YoY COMPARISON)

Median TTM Revenue Growth

1.9x

3.5x

2.4x

3.4x

4.1x 4.1x

1.5x

2.4x

3.2x

1.8x

2.2x

4.2x

2.2x

4.7x4.4x

4.9x

1.9x

3.5x

2.3x

3.2x

3.8x 3.8x

1.3x

2.1x

3.5x

1.8x2.1x

3.7x

2.1x

3.4x

4.1x 4.3x

Billing & ServiceManagement

Business Intelligence DevelopmentPlatforms

Engineering & PLM Enterprise ResourcePlanning

Financial &Accounting

Gaming Healthcare IT Conglomerates MobileSolutions/Content

Networking &Network Performance

Management

Security Storage, DataManagement &

Integration

Systems Management Vertical - Finance Vertical - Other

3Q15

3Q16

3.1%

10.3%10.6%

8.4%

4.8% 5.4%

8.4%

4.6%

-1.1%

25.5%

4.3%

8.8%

1.5%

5.6%7.1%

14.1%

1.8%

10.4% 10.4%

2.1%3.6%

6.1%

12.4%

18.9%

-2.3%

13.3%

4.6%

21.2%

0.9%

7.8% 7.8%

17.5%


Business Intelligence DevelopmentPlatforms

Engineering & PLM Enterprise ResourcePlanning



Networking &Network Performance

Management


Integration

Systems Management Vertical - Finance Vertical - Other

3Q15

3Q16


THE SEG SOFTWARE INDEX BY PRODUCT CATEGORY:FINANCIAL PERFORMANCE (YoY COMPARISON)

Median EV/EBITDA

Median TTM EBITDA Margin

27.2%

18.5% 19.0%

22.9%26.7%

22.3%

14.8%12.3%

31.1%

-3.5%

19.6%

1.6%4.7%

23.8%

34.2%

13.8%

21.8%

15.3%17.1% 17.6%

26.7% 24.2%22.5%

13.5%

28.2%

-0.8%

10.2%

4.7%2.7%

26.9%

31.7%

16.6%


BusinessIntelligence

DevelopmentPlatforms

Engineering & PLM EnterpriseResource Planning



Networking &Network

PerformanceManagement


Integration

SystemsManagement

Vertical - Finance Vertical - Other

3Q15

3Q16

9.2x

18.2x

8.9x

17.1x15.1x 15.3x 14.7x

18.5x

8.8x

15.8x

13.1x15.8x

8.0x

19.1x

13.3x

30.5x

9.7x

14.4x12.8x

16.8x15.5x 15.6x

13.3x15.5x

10.8x

20.8x

13.3x 15.3x

7.8x

16.1x

13.6x

19.7x


BusinessIntelligence

DevelopmentPlatforms

Engineering & PLM EnterpriseResource Planning



Networking &Network

PerformanceManagement


Integration

SystemsManagement

Vertical - Finance Vertical - Other

3Q15

3Q16


THE SEG INTERNET INDEX

PUBLIC INTERNET COMPANY FINANCIAL PERFORMANCE AND MARKET MULTIPLE TRENDS


SEG - Internet: Median Metrics

Measure 3Q15 4Q15 1Q16 2Q16 3Q16EV/TTM Revenue 2.1x 2.0x 2.0x 2.0x 2.3x



EV/TTM CFO 17.8x 18.9x 17.0x 17.0x 18.4x


EBITDA Margin 6.7% 6.9% 7.3% 7.5% 9.1%

Net Income Margin 0.5% 0.2% 0.1% 0.8% -1.3%




TTM Total EBITDA ($M) $27.9 $28.4 $31.6 $31.5 $36.3

Cash & Eq ($M) $169.0 $162.0 $207.0 $174.2 $167.1

THE SEG INTERNET INDEX

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

28

• The SEG Internet Index tracks public companies that primarily offerB2C services or predominantly generate revenue via advertising overthe internet.

• The SEG Internet Index is currently comprised of 99 public Internetcompanies*.

• See appendix for SEG Internet Index public market multiples andfinancial performance on an annual basis


20%

16%

24%

12%

6%

22%

17%

24%

18%

16%

8%

17%

<= 0% > 0%<= 10%

> 10%<= 20%

> 20%<= 30%

> 30%<= 40%

> 40%

% o

f C

om

pa

nie

s

TTM Revenue Growth

3Q15

3Q16

THE SEG INTERNET INDEX: FINANCIAL PERFORMANCE

29


$466.0

$505.9 $527.1$570.0

$604.2

0.0%

2.0%

4.0%

6.0%

8.0%

10.0%

12.0%

14.0%

16.0%

18.0%

20.0%

$0

$100

$200

$300

$400

$500

$600

$700

3Q15 4Q15 1Q16 2Q16 3Q16

TT

M R

ev

en

ue

Gro

wth

TT

M T

ota

l R

ev

en

ue


• Median TTM revenue for public companies in the SEG Internet Indexwas $604.2 million in 3Q16, a 29% YoY increase from 3Q15’s $466million figure. Conversely, this median TTM revenue growth for thiscohort has seen median TTM revenue growth slow to 13.4% in 3Q16from 17.2% one year prior as law of large numbers comes in to effect.

• Once again demonstrating the Internet is an ecosystem of unequals,17% of public Internet providers far outpaced the pack, posting TTMrevenue growth greater than 40% in 3Q16. These high flyersincluded 58.com (150.1%), Netease (112.3%), and The RubiconProject (81.5%).

• Conversely, 41% of public Internet companies struggled to advance,reporting TTM revenue growth of 10% or less in 3Q16. The slowgrowers included TripAdvisor (4.0%), Yahoo! (0.5%), LimelightNetworks (2.4%), Zynga (-0.3%), and 1-800-FLOWERS (4.6%).



30

TTM EBITDA Margin DistributionMedian EBITDA Performance - Quarterly

6.7% 6.9%7.3% 7.5%

9.1%

3Q15 4Q15 1Q16 2Q16 3Q16

EB

ITD

A M

arg

in

29%30%

18%

7%

11%

4%

28%27%

21%

9%

12%

3%

<= 0% > 0%<= 10%

> 10%<= 20%

> 20%<= 30%

> 30%<= 40%

> 40%

% o

f C

om

pa

nie

s

TTM EBITDA Margin

3Q15

3Q16

• Median EBITDA margin rose considerably in 3Q16, following threeconsecutive quarters of modest improvement. However, 28% of thecompanies were unprofitable during the quarter, compared to 53%and 20% of publicly traded SaaS and on-premise software vendors,respectively.

• At the other end of the spectrum, 15% of public Internet companies,mostly those with significant transaction or advertising revenue,achieved EBITDA margins above 30%, led by VeriSign (64.6%),Facebook (50.0%) and Tencent Holdings (43.1%).

• With few exceptions, many of the most profitable public Internetcompanies reported stellar TTM revenue growth. Among them wereNetease (33.9% EBITDA margin, 112.3% TTM revenue growth);Stamps.com (34.7% EBITDA margin, 67.0% TTM revenue growth)and Alibaba (36.1% EBITDA margin, 40.1% TTM revenue growth).



31


62.4% 62.6% 61.9% 62.1% 62.0%

6.7% 6.9% 7.3% 7.5%9.1%

0.5% 0.2% 0.1% 0.8%

-1.3%3Q15 4Q15 1Q16 2Q16 3Q16

% M

arg

in


24.8% 24.6% 25.1% 24.8% 24.3%

12.6% 12.6% 12.5% 12.3% 12.7%12.7%12.3%

12.7% 12.8% 12.5%

3Q15 4Q15 1Q16 2Q16 3Q16

% o

f R

ev

en

ue


• Median spending on operations by public Internet companies in 3Q16 was consistent with historic norms: 24.3% for sales & marketing, 12.7% forresearch & development, and 12.5% for general & administrative. In aggregate, the median operational expenditures for the Internet Index totaled49.5% of revenue in 3Q16, versus 51.4% and 75.8% for our on-premise and SaaS indices, respectively.

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

• Median Gross profit margin and R&D spend as a percent of total revenue has on average been the lowest among our three tracking indices, asInternet companies are comparatively less technical than pure-play SaaS and on-premise software vendors.


35%

22%

14%

6%4% 4% 3% 3%

2%

6%

26%

16% 18%

7%8% 8%

6% 6%

1%

7%

<= 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

3Q15

3Q16

THE SEG INTERNET INDEX: PUBLIC MARKET MULTIPLES

32

EV/Revenue Multiple DistributionMedian EV/Revenue and EV/EBITDA Multiples- Quarterly

2.1x 2.0x 2.0x 2.0x 2.3x

18.2x

20.8x

18.4x 19.0x19.8x

3Q15 4Q15 1Q16 2Q16 3Q16


• The median EV/Revenue multiple for SEG’s Internet Index rose to2.3x in 3Q16, from 2.0x the prior three quarters, following thepositive trend in our SaaS and on-premise indices as the marketshave generally rebounded from a dismal first quarter.

• That said, investors in Q3 continued to richly reward the mostrapidly growing and most promising Internet providers, especiallythose that generated significant revenue from online advertisingand ecommerce. Seven percent of companies closed the quarterwith a market multiple of 9.0x EV/Revenue or higher, includingAlibaba (14.1x EV/Rev), Facebook (15.1x EV/Rev), Ctrip (10.7xEV/Rev) and RenRen (13.7x EV/Rev).


1.2x1.7x 1.7x

4.9x

3.5x

6.8x

1.9x1.4x

2.2x

4.8x5.5x

12.4x

<= 0% > 0%<= 10%

> 10%<= 20%

> 20%<= 30%

> 30%<= 40%

> 40%

Me

dia

n E

V/

Re

ve

nu

e

TTM EBITDA Margin

3Q15

3Q16

1.2x

1.8x 1.8x

3.1x

6.0x

0.6x

1.5x

2.6x

3.4x

4.6x

<= 0% > 0%<= 10%

> 10%<= 20%

> 20%<= 30%

>30%

Me

dia

n E

V/

Re

ve

nu

e

TTM Revenue Growth

3Q15

3Q16

THE SEG INTERNET INDEX: PUBLIC MARKET MULTIPLES

33

EV/Revenue Multiples vs. TTM EBITDA MarginsEV/Revenue Multiples vs. TTM Revenue Growth

• Here, too, investors favored growth, albeit not to the extent of software and SaaS vendors. Public Internet companies with TTM revenue growth of 30% orhigher received a median EV/Revenue multiple of 4.6x in Q3. The outperformers included Stamps.com (67.0%, 5.4x EV/Revenue); Zillow (54.4%, 8.3xEV/Revenue); Facebook (51.4%, 15.1x EV/Revenue) and Alibaba (40.1%, 14.1x EV/Revenue).

• Investors in public Internet companies kept a keen eye on margins, and rewarded more profitable performers with significantly higher public marketmultiples. Public Internet companies with EBITDA margins above 40% posted a median EV/Revenue multiple of 12.4x in 3Q16, over 10.1x higher thanthe overall Index median.


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

• Representative companies in each Internet category are referenced below.

• See the appendix for the complete list of companies within each product category.

THE SEG INTERNET INDEX BY PRODUCT CATEGORY

34

Ad Tech Commerce Content and Media Gaming

Infrastructure Search Services TravelSocial


THE SEG INTERNET INDEX BY PRODUCT CATEGORY:FINANCIAL PERFORMANCE (YoY COMPARISON)

35

Median TTM Revenue Growth

Median EV/Revenue Multiples

22.2%

17.2%

8.4%

16.3%

7.6%

16.7%

20.5%

46.2%

16.2%

10.4% 10.7%

3.9% 3.5%

9.0%

21.3% 23.6%

34.8%

16.6%

Ad Tech Commerce Content & Media Gaming Infrastructure Search Services Social Travel

3Q15

3Q16

2.1x1.5x

2.1x

2.8x

1.5x

4.5x

2.0x

9.1x

4.8x

0.9x

2.1x2.8x

3.6x

1.8x

5.4x

2.2x

5.5x

4.1x


3Q15

3Q16


THE SEG INTERNET INDEX BY PRODUCT CATEGORY:FINANCIAL PERFORMANCE (YoY COMPARISON)

36

Median TTM EBITDA Margin

Median EV/EBITDA Multiples

1.2%

6.2%

11.1%

31.9%

6.4%

31.3%

5.6%

15.8%

7.8%

3.1%5.1% 4.1%

33.1%

4.3%

27.3%

9.5%

17.3%

9.5%


3Q15

3Q16

18.7x17.8x

16.4x

10.3x

18.3x

15.8x18.5x

39.1x

21.4x

17.4x

27.0x

36.6x

14.7x

21.7x18.7x

20.2x19.0x

21.1x


3Q15

3Q16


SOFTWARE INDUSTRY M&A MARKET UPDATE


• There were 539 reported software M&A transactions in 3Q16, a modest decline from 2Q16’s 584, However, we expect that the third quarter tally willlikely increase by approximately 15 – 20 transactions as unpublicized deals are added. 3Q16 marks the eighth consecutive quarter in which transactionvolume has surpassed 500 deals.

• On a TTM basis, average quarterly deal volume reached 574 transactions in 3Q16, representing an 18% increase in transaction activity over this pastdecade’s pre-recession high in 2Q08 (487 TTM quarterly average). Even more impressive, TTM average quarterly deal volume has posted quarter overquarter increases in 21 of 27 quarters since bottoming out in 4Q09 (326 TTM quarterly average).

• Software M&A spending in 3Q16 totaled $50.1 billion, down from Q2’s $67.3 billion aggregate price tag, which included Microsoft’s acquisition of LinkedIn($26.1 billion EV, 8.2x TTM revenue). Led by Oracle’s pending acquisition of NetSuite for $8.7 billion (10.3x TTM revenue) and Micro Focus’ purchase ofHewlett Packard’s enterprise software division for $8.7 billion (2.8x TTM revenue), there were 16 mega deals (EV > $500 million) announced during thequarter, a positive sign for continued M&A activity in the quarters ahead.

3Q16 SOFTWARE INDUSTRY M&A DEAL VOLUME AND SPENDING

38

TTM Average Quarterly Deal VolumeU.S. Software Mergers & Acquisitions Activity

574

0

100

200

300

400

500

600

1Q07 4Q07 3Q08 2Q09 1Q10 4Q10 3Q11 2Q12 1Q13 4Q13 3Q14 2Q15 1Q16

Nu

mb

er

of

De

als

444 455 460

517488

505 513

587 578565 570

584

539

$20.2$22.8

$31.4

$26.6

$43.5

$17.7 $17.7

$34.8

$46.1

$34.4

$45.2

$67.3

$50.1

$0

$10

$20

$30

$40

$50

$60

$70

$80

0

100

200

300

400

500

600

3Q13 4Q13 1Q14 2Q14 3Q14 4Q14 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16

Valu

e (BIllio

ns)

Nu

mb

er

of

De

als

Deals Value


• 3Q16’s 195 SaaS M&A transactions marks the 12th consecutive quarter of ramping deal volume and 24% year over year increase when compared to 3Q15’s157 transactions.

• On an annual basis, SEG is projecting 753 SaaS M&A transactions during 2016, a 25% increase over 2015’s 601 deals and nearly double the 390transactions announced just three years ago.

• Multiple tailwinds continue to drive strong SaaS deal volume growth:

• A secular shift toward cloud computing applications and a need for legacy on-premise vendors to acquire cloud computing expertise.

• An extremely active private equity market that continues to be attracted to high growth subscription-based software business models.

• Cheap credit available for transaction financing.

SaaS M&A: DEAL VOLUME AND MEDIAN EXIT MULTIPLES

39

Annual SaaS M&A VolumeQuarterly SaaS M&A Volume

97 103 104 108118

132 134150 157 160

180190 195

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

50%

0

50

100

150

200

250

SaaS

M&

A D

eal

s as

a %

of

Tota

l So

ftw

are

M&

A D

eal

s

# o

f Sa

aS M

&A

De

als

SaaS M&A Deals SaaS as % of Software

105

200

312

390

462

601

753

0

100

200

300

400

500

600

700

800

2010 2011 2012 2013 2014 2015 2016

# o

f Sa

aS M

&A

De

als


SaaS M&A: MEDIAN EXIT MULTIPLES

40

Median TTM SaaS EV/ Revenue Exit Multiples

• For the 12 months ending September 2016, SaaS companies werepurchased for a median 4.5x TTM revenue, on par with recentquarters. After dipping below 4.0x TTM revenue from 4Q14 through3Q15, the median exit multiple for SaaS businesses has held firmlyabove 4.0x for the past four quarters.

• Select 3Q TTM SaaS transactions posting exit multiples well above themedian included Verizon’s 3Q16 acquisition of Fleetmatics ($2.4billion, 7.0x TTM revenue); Wolters Kluwer’s 2Q16 acquisition ofEnablon ($364 million, 5.6x TTM revenue); Visma’s 1Q16 acquisitionof Fortnox ($163 million, 9.4x TTM revenue) and PTC’s 4Q15acquisition of Kepware Technologies ($118 million, 5.9x TTMrevenue)

• In addition, four publicly traded SaaS companies announced an intentto be acquired during Q3, with a couple of those receiving offersmaterially higher than our median exit multiple.

Q3 Public SaaS Sellers

• Led by Oracle’s intended acquisition of SaaS ERP vendor, Netsuite($8.7 billion EV, 10.3x TTM Revenue), four publicly traded SaaScompanies announced an intent to be acquired during the thirdquarter. This follows the 2Q16 in which seven publicly traded SaaSproviders were acquired.

• Size and scale was a key determinant to each target’s revenuemultiple:

• Netsuite’s ($846.4 million revenue) purchase by Oracle;Fleetmatics’ $310.7 million revenue) purchase by Verizon;Apigee’s ($92.0 million revenue) purchase by Google; andQHR’s ($23.5 million revenue) purchase by Loblaw.

EV

/R

ev

en

ue

EV

/R

ev

en

ue

10.3x

7.0x

5.3x 5.1x

NetSuite Inc.(NYSE:N)

Fleetmatics GroupPLC (NYSE:FLTX)

ApigeeCorporation

(NasdaqGS:APIC)

QHR Corporation(TSXV:QHR)

3.7x

4.2x

4.6x 4.5x 4.5x

3Q15 4Q15 1Q16 2Q16 3Q16


SaaS M&A: MEDIAN EXIT MULTIPLES

41

• Over the past three years, over one third of all SaaS targets wereacquired for 5.0x TTM or greater.

o Many of these targets were growing quickly, served largemarkets and attracted deep pocketed buyers (ie. Zillow’sacquisition of real estate software provider, Dotloop, which wasrumored to growing revenue north of 100% at the time of saleand sold for approximately 7.2x TTM revenue).

• Conversely, approximately 30% of all SaaS targets were acquired for3.0x revenue or less.

o Many of these targets showed modest growth and operated incommoditized markets with little product differentiation (ie.Endurance International Group’s purchase of SaaS emailmarketing provider Constant Contact for 2.6x TTM revenue(10.8% TTM revenue growth)

Median EV/Revenue Exit Multiple Distribution (Last 3 Years)

Seller Revenue ($)

EV

/R

ev

en

ue

• To calculate exit multiples by seller size, we analyzed the past threeyears worth of SaaS deals to drive a meaningful data set.

• Buyers continue to reward those SaaS businesses exhibitingsignificant scale. Sellers with revenue between $20-50 million haveachieved a median 5.0x TTM revenue over the time period, whilethose with revenue greater than $50 million received a slightdiscount. This is due to the prevalence of private equity buyersseeking larger assets. Approximately 25% of the deals in our $100M+seller revenue bucket included a private equity sponsor compared to13% and 0% for our $50-100M and $20-50M seller revenue buckets,respectively.

• Those generating revenues of less than $5M received a median 2.9xTTM revenue multiple.

EV/Revenue by Seller Size (Last 3 Years)

5.6% 6.3%

19.0% 19.0%

14.3%

11.1%

24.6%

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

> 2.0x & <=3.0x

> 3.0x & <=4.0x

> 4.0x & <=5.0x

> 5.0x & <=6.0x

> 6.0x

TTM Revenue Exit Multiple Bins

% o

f D

ea

ls -

La

st 3

Ye

ars

2.9x

3.6x 3.7x

5.0x

4.4x 4.3x

<5M 5M-10M 10M-20M 20M-50M 50M-100M 100M+


SaaS M&A BY PRODUCT CATEGORY – 3Q16

Vertical Product Categories

Horizontal Product Categories

7.0%

3.2%

6.4%5.7%

1.3%

4.5%

6.4%

1.9%

4.6% 4.6% 4.6%

1.5% 1.5%

10.3%

3.1%2.6%

Education Financial Services Healthcare Hospitality Insurance Other Verticals Real Estate Retail

3Q15

3Q16

4.5%3.8%

15.3%

1.3% 1.3%

2.5%

9.6%

6.4%

2.5%3.2%

3.8%

1.9%

0.6%

1.9%2.5%

4.1%

2.6%

8.2%

4.1%

1.5% 1.5%

9.2%

7.2%

2.6%

4.6% 4.6%5.1%

1.0%

4.1%

1.5%

BI, Risk &Compliance

Content &Document Mgmt

CRM, Marketing& Sales

Dev. Tools & ITAsset Mgmt

eCommerce Engineering &PLM

HR & WorkforceMgmt

Messaging,Conferencing &

Communications

Multimedia,Graphics &

Communications

Security Systems Mgmt Supply ChainMgmt & Logistics

Accounting &Finance

AssetManagement

Billing & ServiceProvisioning

3Q15

3Q16


3Q16 SaaS M&A TRANSACTIONS

43

Date Buyer SellerEnterprise Value

(mm) TTM Revenue EV/Rev09/30/16 The Ultimate Software Group, Inc. (NasdaqGS:ULTI) Kanjoya, Inc. - - -

09/29/16 VelocityEHS e3 Solutions Inc. - - -

09/29/16 Falfurrias Capital Partners Marquis Software Solutions, Inc. - - -

09/29/16 Thoma Bravo, LLC T2 Systems, Inc. - - -

09/28/16 SAP SE (DB:SAP) PLAT.ONE INC. - - -

09/27/16 Cengage Learning Holdings II, Inc. (OTCPK:CNGO) Advanced Instructional Systems, Inc. - - -

09/26/16 - BlindSpot $28.0 - -

09/26/16 Xingmin Intelligent Transportation Systems (Group) Co., Ltd. Yes Way $63.4 - -

09/22/16 Accruent, LLC VERISAE, INC. - - -

09/22/16 Emakina Group SA (ENXTBR:ALEMK) k.section business solutions gmbh - - -

09/22/16 Airware, Inc Redbird SAS - - -

09/22/16 Welcome Italia spa Qboxmail S.r.l. - - -

09/22/16 PTV Planung Transport Verkehr AG DPS International Ltd. - - -

09/21/16 Evatic AS Cranbox Limited - - -

09/21/16 Newgen KnowledgeWorks (P) Ltd Exult InfoSolutions Pvt. Ltd. - - -

09/21/16 Liaison Financial Services Limited Activ8 Intelligence Limited - - -

09/20/16 Vista Equity Partners III LLC GovDelivery, Inc. $153.0 - -

09/20/16 Secunet Security Networks AG (XTRA:YSN) HJP Consulting GmbH, eID Testing Business Unit - - -

09/20/16 CA, Inc. (NasdaqGS:CA) BlazeMeter LLC - - -

09/20/16 JPMorgan Chase & Co. (NYSE:JPM) InvestCloud, LLC - - -

09/19/16 - P&I Personal & Informatik Aktiengesellschaft - - -

09/18/16 Oracle Corporation (NYSE:ORCL) Palerra, Inc. - - -

09/16/16 Dentsu Aegis Network Ltd. Avid Media Ltd - - -

09/16/16 CashFlows iCheque Network Limited - - -

09/15/16 Grey Cloak Tech Inc. (OTCPK:GRCK) ShareRails - - -

09/15/16 Mirantis, Inc. tcp cloud, a.s. - - -

09/15/16 Event Farm, Inc. Attend, Inc. - - -

09/14/16 General Electric Company (NYSE:GE) Meridium, Inc. - - -

09/14/16 Amdocs Limited (NasdaqGS:DOX) Pontis, Inc. and Vindicia, Inc. - - -

09/14/16 LogoMix Inc. LogoMaker Inc. - - -

09/14/16 Generix SA (ENXTPA:GENX) Sologlobe Logistique, Inc. - - -

09/13/16 Stripe, Inc. Runkit - - -

09/12/16 Accel-KKR LLC Smart Communications - - -

09/12/16 Quad Analytix, LLC Wise Commerce, Inc. - - -

09/09/16 Argyle Executive Forum, LLC Proformative, Inc. - - -

09/08/16 Bridge Growth Partners, LLC Active Internet Technologies, LLC - - -

09/08/16 Citrix Systems, Inc. (NasdaqGS:CTXS) VirtuAll Solutions Ltd. - - -

09/08/16 Dealer Product Services Inc. TimeHighway.com, Inc. - - -

09/08/16 IVR Technology Group, LLC DemandVoice, LLC - - -

09/07/16 Alphabet Inc. (NasdaqGS:GOOGL) Apigee Corporation (NasdaqGS:APIC) $516.3 $92.0 5.6x


3Q16 SaaS M&A TRANSACTIONS (CON’T)

44


(mm) TTM Revenue EV/Rev09/07/16 Sodexo Benefits and Rewards Services Inspirus, LLC - - -

09/07/16 Arkadin SAS Applicable Limited - - -

09/07/16 salesforce.com, inc. (NYSE:CRM) HeyWire, Inc. - - -

09/06/16 McKinsey & Company, Inc. PriceMetrix, Inc. - - -

09/06/16 HCA Holdings, Inc. (NYSE:HCA) Mobile Heartbeat, LLC - - -

09/06/16 Grote Molen, Inc. BlackRidge Technology Holdings, Inc. - - -

09/06/16 GI Partners, LLC DAXKO LLC - - -

09/06/16 MINDBODY, Inc. (NasdaqGM:MB) HealCode, LLC - - -

09/06/16 iZettle AB Intelligent Point Of Sale (Sales) Limited - - -

09/05/16 IT2 Solutions AG LBU Systemhaus AG - - -

09/05/16 Telestream, Inc. Vidcheck Ltd - - -

09/02/16 Navent Group Ltd. Hiring Room - - -

09/01/16 Fleetmatics Group PLC (NYSE:FLTX) Inosat - Consultoria Informatica, S.A. - - -

09/01/16 Tieto Oyj (HLSE:TIE1V) Emric AB - - -

09/01/16 ALA Services LLC Adaptive Computing Enterprises, Inc. - - -

08/31/16 Tradeos Limited Webcargo, SL - - -

08/30/16 LG Informática S.A. E-Guru Serviços de Informática Ltda. - - -

08/30/16 One More Co Inc. KWAGA SAS - - -

08/30/16 Cisco Systems, Inc. (NasdaqGS:CSCO) ContainerX, Inc. - - -

08/30/16 GE Transportation ShipXpress, A GE Transportation Company - - -

08/29/16 Wood Mackenzie Ltd Quest Offshore Resources, Inc., Data and Subscriptions Business - - -

08/26/16 KKR & Co. L.P. (NYSE:KKR) Calabrio, Inc. - - -

08/25/16 Clavister Holding AB (publ) (OM:CLAV) PhenixID AB $11.5 $1.1 10.4x

08/24/16 Proofpoint, Inc. (NasdaqGM:PFPT) Return Path, Inc., Email Fraud Protection Division $18.0 - -

08/24/16 gamigo AG HoneyTracks GmbH - - -

08/24/16 GBT III B.V. Klee Data System SA - - -

08/24/16 - Cardlay A/S - - -

08/22/16 iGAMBIT, Inc. (OTCPK:IGMB) HubCentrix Inc. $0.5 - -

08/21/16 Loblaw Companies Limited (TSX:L) QHR Corporation (TSXV:QHR) $119.8 $23.6 5.1x

08/18/16 John Wiley & Sons Inc. (NYSE:JW.A) Atypon Systems Incorporated $120.0 $31.0 3.9x

08/18/16 Rakuten, Inc. (TSE:4755) Bitnet Technologies Ltd. - - -

08/18/16 REAN Cloud LLC Opex Software LLP. - - -

08/18/16 Vista Equity Partners Granicus Inc. - - -

08/17/16 SAI Global Limited (ASX:SAI) Modulo Security, LLC $5.2 - -

08/17/16 ASRC Federal Holding Company, LLC Vistronix Intelligence & Technology Solutions, LLC - - -

08/17/16 FullContact Inc. Aireum Inc. - - -

08/17/16 Institutional Shareholder Services Inc. iiWisdom, LLC - - -

08/17/16 Speridian Technologies, LLC Sesame Software Solutions Pvt. Ltd. - - -

08/15/16 Briggs Medical Service Company SimpleLTC, Inc. - - -

08/15/16 MediSolution Ltd. Artemis, Inc. - - -



45


(mm) TTM Revenue EV/Rev08/15/16 salesforce.com, inc. (NYSE:CRM) BeyondCore, Inc. - - -

08/15/16 Blue Star Sports SDI Camps & Races, LLC - - -

08/12/16 Monterro Holdings AB Outpost24 AB - - -

08/11/16 Breezeworks Corporation Prompt.ly, Inc. - - -

08/11/16 CMLS Financial Ltd. Delta 360, Inc. - - -

08/10/16 boomtrain, Inc. Nudgespot Technologies Pvt. Ltd. - - -

08/10/16 Rodan Energy Solutions Inc. Sygration Inc. - - -

08/09/16 Plex Systems, Inc. Cadent Resources, Inc. - - -

08/09/16 Bidpath Ltd. Pacts Auction Systems Limited - - -

08/08/16 BrandMuscle Inc. Saepio Technologies, Inc. - - -

08/05/16 LDC (Managers) Limited ByBox Holdings Limited $137.3 $95.3 1.4x

08/05/16 Google Inc. Orbitera Inc. - - -

08/05/16 Apple Inc. (NasdaqGS:AAPL) Turi Inc. - - -

08/04/16 - TeleMessage Ltd. $0.7 - -

08/04/16 Cuddle Clones LLC Cartoonize My Pet LLC - - -

08/04/16 Benefit Express Services, LLC Transcend Technologies Group, Inc. - - -

08/04/16 Virtus Nutrition, LLC FARMERON d.o.o. - - -

08/03/16 Beijing Shiji Information Technology, Co., Ltd. (SZSE:002153) hetras Deutschland GmbH - - -

08/03/16 Renovate America, Inc. CakeSystems, Inc. - - -

08/02/16 Defenx Plc (AIM:DFX) Memopal s.r.l. $2.7 $0.9 2.9x

08/02/16 Truno Retail Technology Solutions, Inc. Resolution Systems, Inc. - - -

08/02/16 Zillow Group, Inc. (NasdaqGS:ZG) Bridge Interactive Group, LLC - - -

08/01/16 MYOB Group Limited (ASX:MYO) Greentree International Limited $20.5 - -

08/01/16 whiteclouds inc. Sandboxr, Inc. - - -

08/01/16 Manalto Limited (ASX:MTL) Marketing Technologies Group Pty Ltd - - -

08/01/16 Magento, Inc. RJMetrics Inc. - - -

08/01/16 Edgenuity, Inc. CompassLearning, Inc. - - -

08/01/16 Planview, Inc. Innotas, Inc. - - -

08/01/16 Neverfail Neverfail Workspaces - - -

08/01/16 Dominion Payroll Services Tennessee, LLC Avintus Employer Services - - -

08/01/16 Specialist Computer Services Limited Pyramid Human Resources Limited - - -

08/01/16 Emergency Communications Network, LLC MIR3, Inc. - - -

08/01/16 - Market6, Inc. - - -

07/31/16 Jobookit Holdings Ltd. (TASE:JBKT) Homeez Ltd. - - -

07/30/16 Verizon Communications Inc. (NYSE:VZ) Fleetmatics Group PLC (NYSE:FLTX) $2,183.5 $310.6 7.0x

07/30/16 salesforce.com, inc. (NYSE:CRM) Quip, Inc. $582.0 - -

07/29/16 H.I.G. Capital, LLC Symplicity Corporation - - -

07/28/16 CYBERLINKS co.,LTD. (TSE:3683) Cloud Land Ltd. $1.0 $3.6 0.3x

07/28/16 Oracle Corporation (NYSE:ORCL) NetSuite Inc. (NYSE:N) $8,698.9 $846.2 10.3x

07/28/16 AVL LIST GmbH Dacolt International BV - - -



46


(mm) TTM Revenue EV/Rev07/28/16 Riverbed Technology, Inc. Aternity, Inc. - - -

07/28/16 viihealth inc. Argolife SAS And Argonautes Tunisia, SARL - - -

07/27/16 Endurance International Group Holdings, Inc. (NasdaqGS:EIGI) AppMachine B.V. $26.2 - -

07/27/16 Main Capital Partners B.V. Substantial Stake In Obi4wan And Obilytics - - -07/27/16 Pepperjam, LLC Pepperjam Performance Marketing - - -

07/26/16 IDOX plc (AIM:IDOX) Open Objects Software Ltd. $6.9 $3.8 1.8x

07/26/16 A10 Networks, Inc. (NYSE:ATEN) Appcito, Inc. $6.5 - -

07/26/16 LinkedIn Corporation (NYSE:LNKD) PointDrive LLC - - -

07/26/16 Yahoo Japan Corporation (TSE:4689) Commerce21 Corporation - - -

07/26/16 - Talent On View Limited - - -

07/26/16 Fidelity National Financial, Inc. (NYSE:FNF) Commissions Inc. - - -

07/25/16 Sandler Partners Inc. X4 Solutions Inc. - - -

07/25/16 Falcon Acquisitions Limited (LSE:FAL) Quiptel Hong Kong Limited - - -

07/25/16 A Plus Finance SA; Edmond de Rothschild Investment Partners Travelsoft SAS - - -

07/25/16 SportsEngine Beyond the Scores, LLC - - -

07/25/16 Dynamis, Inc. Emergency & Security Management Solutions - - -

07/25/16 Nayax Ltd. VendSys - - -

07/24/16 HyperGrid Inc DCHQ Inc. - - -

07/21/16 Net Element, Inc. (NasdaqCM:NETE) 51% Stake in PayStar, Inc. and Nexcharge, Inc. $3.4 - -

07/21/16 Workday, Inc. (NYSE:WDAY) Platfora, Inc. - - -

07/21/16 GoHealth, LLC 1SourceAdmin LLC - - -

07/21/16 salesforce.com, inc. (NYSE:CRM) Coolan, Inc. - - -

07/21/16 REZ-1, Inc. International Asset Systems USA Limited - - -

07/21/16 SportsEngine Sioux Falls Swim Team, Inc. - - -

07/20/16 Eckoh Plc (AIM:ECK) Klick2Contact EU LTD $8.8 $1.0 9.1x

07/20/16 Nuance Communications, Inc. (NasdaqGS:NUAN) TouchCommerce, Inc. $215.1 - -

07/20/16 AFN, LLC HA Advantage, Inc. - - -

07/20/16 Marlin Equity Partners, LLC Revenew, Inc. - - -

07/20/16 GreatSchools, Inc. Schoolie, Inc. - - -

07/20/16 3PL Central, LLC TS Traker Systems Inc. - - -

07/19/16 Volaris Group Inc. The Alpha School System PTY LTD - - -

07/19/16 Utility Telephone, Inc. Prestige Voice Mail Service, Inc. - - -

07/19/16 Virtual Hold Technology, LLC CallPromise, LLC - - -07/19/16 Carbon Black, Inc. Confer Technologies, Inc. - - -

07/19/16 Apax Partners LLP Dominion Marine Media, LLC - - -

07/19/16 SportsEngine Trackwrestling.com, LLC - - -

07/18/16 Solera Holdings Inc. Enservio, Inc. - - -

07/15/16 Harris School Solutions Media-X Systems Inc. - - -

07/14/16 Amazon Web Services, Inc. Cloud9 IDE, Inc. - - -

07/14/16 Mobvista International Technology Limited Game Analytics ApS - - -



47


(mm) TTM Revenue EV/Rev

07/14/16 Matterport, Inc. Inspired Labs Ltd - - -

07/13/16 Thoma Bravo, LLC Imprivata, Inc. $488.5 $131.3 3.7x

07/13/16 Catapult Group International Ltd. (ASX:CAT) XOS Digital, Inc. $60.0 - -

07/13/16 Independent Publishers Group INscribe Digital - - -

07/12/16 INTCAS (UK) Ltd. FundsV.com, LLC - - -

07/12/16 Five Pack Creative, Inc. Hours, LLC - - -

07/12/16 Casio Computer Co., Ltd. (TSE:6952) Ripplex Inc. - - -

07/12/16 Foxit Software Incorporated Sumilux Technologies, Inc. - - -

07/12/16 Fort Point Capital WolfePak Software, LLC - - -

07/11/16 MI9 Business Intelligence Systems, Inc. Upshot Commerce - - -

07/11/16 Blackbaud Inc. (NasdaqGS:BLKB) Good + Geek Inc. - - -

07/11/16 eBay Inc. (NasdaqGS:EBAY) SalesPredict Ltd. - - -

07/11/16 Myntra Designs Private Limited Grid Ant Technologies Private Limited - - -

07/11/16 DABERO Service Group GmbH Wassermann AG - - -

07/11/16 Infor, Inc. Starmount Inc. - - -

07/08/16 IP-Only AB Arkena Nordics - - -

07/08/16 Integral Ad Science, Inc. Swarm Enterprises Inc. - - -

07/08/16 Caretta Partners, LLC cSuite Technologies Inc. - - -

07/08/16 Nordstrom Inc. (NYSE:JWN) DS Co. - - -

07/08/16 TrustYou GmbH Checkmate, Inc. - - -

07/07/16 Avenue 81, Inc. Drip, Inc. - - -

07/07/16 Develus Systems Inc. Suncoast Solutions, Inc. - - -

07/07/16 Alphabet Inc. (NasdaqGS:GOOGL) Anvato Inc. - - -

07/07/16 PRA Group, Inc. (NasdaqGS:PRAA) RamWare LLC - - -

07/07/16 Acuity Brands, Inc. (NYSE:AYI) DGlogik, Inc. - - -

07/06/16 AVAST Software s.r.o. AVG Technologies N.V. (NYSE:AVG) $1,463.0 $430.3 3.4x

07/06/16 Exlservice Holdings, Inc. (NasdaqGS:EXLS) Liss Systems Ltd. - - -

07/05/16 Point of Rental Software, Inc. Higher Concept Software Limited - - -

07/05/16 gamigo AG highdigit GmbH - - -

07/04/16 DIMO Software S.A.S. CashOnTime Inc. - - -

07/04/16 Rision Limited (ASX:RNL) Online Rostering Pty Ltd - - -

07/01/16 BigAir Group Limited (ASX:BGL) CyberHound Pty Ltd. $5.3 - -

07/01/16 Telstra Corporation Limited (ASX:TLS) Readify Limited - - -

07/01/16 NBC Sports, Inc. SportsEngine - - -

07/01/16 Northshore Management Company, LLC Fiveworx, Inc. - - -


• In 3Q16, on-premise software providers posted a median 2.0x TTMrevenue multiple, less than half the median 4.5x TTM multiple postedby SaaS sellers in 3Q16.

• With the exception of 4Q15’s 2.6x TTM revenue, median exit multipleshave floated between 2.0x and 2.5x TTM revenue since 3Q13 for on-premise software providers.

• The median EV/EBITDA exit multiple for public on-premise softwarecompanies was 14.6x TTM EBITDA in 3Q16, roughly in line with theprior quarter.

• The multiple for on-premise vendors has begun to soften in 2016 andis at its lowest point since 2Q13’s median 1.8x TTM revenue.

ON-PREMISE SOFTWARE M&A EXIT MULTIPLES

• On a TTM basis, approximately 51% of all on-premise softwaretargets in 3Q16 were acquired for 2.0x TTM or less, and 65% for 3.0xor less. In comparison, 52% were acquired for 2.0x TTM revenue orless and 72% for 3.0x or less in 2Q16.

• Notable on-premise software transactions significantly exceedingmedian exit multiples include EQT Partners’ acquisition of health caresoftware provider, Press Ganey, for $2.4 billion (6.9x TTM revenue)and Mastercard’s acquisition of payments technology provider,VocaLink, for $1.2 billion (5.0x TTM revenue).

48

*Note - EV/EBITDA multiples comprised public sellers only

Median EV/Revenue Exit Multiple DistributionMedian Exit Multiples

2.5x 2.6x 2.2x 2.1x 2.0x

18.1x

24.7x23.2x

15.0x 14.6x

0.0x

5.0x

10.0x

15.0x

20.0x

25.0x

30.0x

3Q15 4Q15 1Q16 2Q16 3Q16

EV/Revenue EV/EBITDA27.6%

23.8%

14.3%13.3%

6.7%

3.8%

10.5%

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

> 2.0x & <=3.0x

> 3.0x & <=4.0x

> 4.0x & <=5.0x

> 5.0x & <=6.0x

> 6.0x

TTM Revenue Exit Multiple Bins

% o

f D

ea

ls –

3Q

16

TT

M


ON-PREMISE SOFTWARE M&A: BY OWNERSHIP STRUCTURE AND SIZE

• Of the TTM deals announced with an ascertainable EV/Rev exitmultiple, approximately 80% of software M&A transactions featuredprivately-held targets.

• The median TTM exit multiple was significantly higher for public on-premise software sellers (3.0x TTM revenue) than for their privatecounterparts (1.8x TTM revenue).

• Over the last 12 months, public buyers paid a median 1.8x TTMrevenue for their targets, compared to a median of 2.4x paid byprivate buyers.

• Buyers with revenue greater than $200 million paid a median 2.6xTTM revenue for their targets, compared to a median 1.6x TTMrevenue paid by sub-$200 million revenue buyers.

• While the highest exit multiples have historically featured a largepublic or private buyer (greater than $200 million in revenue)acquiring a small target (less than $20 million), this was not the casein 3Q16. For the last 12 months, large buyers paid a median 2.6x TTMrevenue for acquisition targets small and large.

49

Seller Less

Than $20

million: 2.4x

Seller Less

Than $20

million: 2.6x

Seller Greater

Than $20

million: 1.5x

Seller Greater

Than $20

million: 0.8x

Seller Less

Than $20

million: 1.6x

Seller Less

Seller Greater

Than $20

million: 1.7x

Seller Greater

Than $20

million: 2.6x

Buyer Less Than $200

million1.6x Median Multiple

Buyer Greater Than

$200 million2.6x Median Multiple

Large vs. Smaller BuyerPublic vs. Private Target

52%48%


ON-PREMISE SOFTWARE M&A: BY VERTICAL AND HORIZONTAL MARKETS

• The median exit valuation of horizontal software companies was 2.1x TTM revenue in 3Q16, on par with recent quarters. Representative Q3 horizontaltransactions included EQT Partners’ acquisition of healthcare service provider, Press Ganey, for $2.4 billion (6.9x TTM revenue); MasterCard’s acquisitionof payments provider, VocaLink, for $1.1 billion (5x TTM revenue); DTI’s acquisition of legal software company, Epiq Systems, for $1.0 billion (1.9x TTMrevenue).

• The median exit valuation of vertical software companies was 2.4x TTM revenue in 3Q16, also on par with recent quarters. Vertical software targets havefetched a higher median EV/Revenue exit multiple than their horizontal software counterparts for the past eight quarters. That represents a markedturnaround for vertical software median exit valuations after a dismal 2012 and 2013 (1.5x). The vertical exit recovery began in 2014 when the medianmultiple advanced to 2.2x.

• Q3’s more noteworthy vertical on-premise software deals included Micro Focus’ acquisition of Hewlett Packards enterprise software division for $8.7billion (2.7x TTM revenue); LogMeIn’s acquisition of Citrix’s GoTo family of products for $1.8 billion; Genesys Telecom’s acquisition of InteractiveIntelligence for $1.5 billion (3.4x TTM revenue); and Open Text’s acquisition of Dell’s enterprise content management business for $1.6 billion (2.7x TTMrevenue).

50

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

2.4x 2.4x2.5x

2.3x2.4x

2.1x 2.1x 2.1x2.2x

2.1x

3Q15 4Q15 1Q16 2Q16 3Q16

Vertical Horizontal

34% 36% 31% 35% 35%

66% 64% 69% 65% 65%

3Q15 4Q15 1Q16 2Q16 3Q16

Vertical Horizontal


ON-PREMISE SOFTWARE M&A ACTIVITY BY PRODUCT CATEGORY

Vertical Product Categories

Horizontal Product Categories

4.7%

4.1%

5.2%

0.6% 0.8%

1.7%

1.1%

2.8%

1.4%

0.8%

0.0%

2.2% 2.2%

0.8%

5.2%

1.4%

7.4%

2.1%

1.1%

1.8%

1.1%

1.8%

0.7%

1.8%1.4%

2.1%

1.4%1.8%

6.0%

1.1%

4.9%

0.4%

BI, Risk &Compliance

Content &Document Mgmt

CRM, Marketing &Sales

DataMgmt/Integration

Dev. Tools & ITAsset Mgmt

eCommerce EDA Engineering &PLM

ERP Entertainment HR & WorkforceMgmt

Messaging,Conferencing &

Communications

Multimedia,Graphics &

Communications

NetworkPerformance

Mgmt

Security Billing & ServiceProvisioning

3Q15

3Q16

5.5%

8.0%

5.0%

1.4%

8.0%

1.7%0.8%

2.2%

0.8%1.7%

2.8%3.9%

2.1%1.1%

13.1%

2.5%1.4%

5.3%

1.1%1.8%

Education Financial Services Healthcare Insurance Other Verticals Public Sector Retail Real Estate Legal Automotive

3Q15

3Q16


ON-PREMISE SOFTWARE M&A EXIT VALUATIONS BY PRODUCT CATEGORY

• Among the 36 on-premise software product categories we track, eleven had both sufficient deal activity and deal data to ascertain a category TTM revenuemultiple in 3Q16.

• On a TTM basis, the Financial Services category was rewarded with the highest median exit multiple (4.2x TTM revenue), followed by Healthcare with amedian exit multiple of 3.8x TTM revenue.

• Notable Healthcare transactions include IBM’s 1Q16 acquisition of healthcare analytics provider, Truven Holding ($3.6 billion, 5.8x TTM revenue); Echo’s3Q16 acquisition of Morrisey ($48 million, 3.8x TTM revenue) and Progenics Pharmaceuticals’ 4Q15 acquisition of EXINI Diagnostics AB ($7.1 million, 6.3xTTM revenue).

• Notable Financial Services software transactions included Mastercard’s 3Q16 acquisition of VocaLink ($1.1 billion, 5.1x TTM revenue); IntercontinentalExchange’s 4Q15 acquisition of Trayport ($860 million, 11.0x TTM revenue); and Broadridge Financial Solutions’ 2Q16 acquisition of 4Sight FinancialSoftware Limited ($40 million, 3.3x TTM revenue).

• On-premise CRM & Marketing and Human Capital Management exit multiples lagged far behind all other product categories on a TTM basis – posting ameager 1.0x and 0.8x median TTM revenue multiple in 3Q16, respectively.

52

Median EV/Revenue Exit Multiples by Software Product Category

4.2x3.8x

3.2x

2.4x1.8x 1.7x 1.7x

1.2x 1.2x 1.0x 0.8x

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Software Equity Group (SEG) is a boutique investment bank and M&A advisory serving emerging and middle market software companies. For more than twenty years, SEG has worked alongside its software industry clients to drive extraordinary outcomes for the client's shareholders, employees and customers. Over this time period, SEG has managed hundreds of sell-side M&A transactions, representing billions of dollars of aggregate transaction value. SEG's unwavering commitment to the software industry equates to unmatched expertise across software industry product categories, delivery models, technology and end market verticals; and unrivaled access to key decision makers among strategic and private equity buyers.

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CONTACT INFORMATION:

SEG Capital Advisors, 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 that SEG Capital Advisors LLC (“SEG”) believes to be reliable. However, SEG makes no representations or warranties, express or implied, about the accuracy, completeness or fairness 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. Any person or entity reviewing this report (a) should conduct its own diligence and reach its own conclusions regarding its business transactions, (b) should not rely upon any conclusions reached by SEG, and (c) should consult its own advisors regarding its tax, accounting, financial and/or business decisions. SEG or its affiliates may have an interest in one or more of the securities or companies discussed herein. Financial data was provided by Capital IQ.

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ABOUT SOFTWARE EQUITY GROUP

53


APPENDIX


THE SEG SaaS INDEX: PUBLIC MARKET MULTIPLES (ANNUAL)

55

31.4x 32.2x35.2x 35.2x

42.4x

56.8x

33.9x

2009 2010 2011 2012 2013 2014 2015

Me

dia

n E

V/

EB

ITD

A M

ult

iple

2.6x

3.6x

4.5x5.0x

6.7x

5.7x 5.8x

2009 2010 2011 2012 2013 2014 2015

Me

dia

n E

V/

Re

ve

nu

e M

ult

iple

Median EV/EBITDA – AnnualMedian EV/Revenue – Annual


$123.7

$104.7

$155.4 $169.0 $163.5

$128.7

$164.1

2009 2010 2011 2012 2013 2014 2015

TT

M T

ota

l R

ev

en

ue

68.3% 68.6%

63.4%

70.9%70.0%

66.1% 66.0%

2009 2010 2011 2012 2013 2014 2015

Gro

ss P

rofi

t M

arg

in

THE SEG SaaS INDEX: FINANCIAL PERFORMANCE (ANNUAL)

26.0%

14.2%

26.9%25.5% 26.0%

28.4%27.1%

2009 2010 2011 2012 2013 2014 2015

TT

M R

ev

en

ue

Gro

wth

6.7%

9.6%8.8%

8.1%

1.0%

-8.9% -9.4%

2009 2010 2011 2012 2013 2014 2015

EB

ITD

A M

arg

in

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

Median EBITDA Margin - AnnualMedian Gross Profit Margin - Annual


THE SEG SOFTWARE INDEX: PUBLIC MARKET MULTIPLES (ANNUAL)

1.5x

2.3x

2.7x 2.7x

3.0x 3.0x

2.8x

2009 2010 2011 2012 2013 2014 2015

EV

/R

ev

en

ue

Mu

ltip

le

10.0x

12.4x 12.3x 11.9x

14.0x15.0x

14.0x

2009 2010 2011 2012 2013 2014 2015

EV

/E

BIT

DA

Mu

ltip

le



THE SEG SOFTWARE INDEX: FINANCIAL PERFORMANCE (ANNUAL)

$239.80

$387.90 $381.40

$470.50

$535.80

$743.10

2010 2011 2012 2013 2014 2015

TT

M T

ota

l R

ev

en

ue

4.2% 4.5%

16.1%

13.3%

9.3%8.0% 7.5%

2009 2010 2011 2012 2013 2014 2015

TT

M R

ev

en

ue

Gro

wth

66.6%

68.6%

65.8%66.1%

66.5%66.0%

65.7%

2009 2010 2011 2012 2013 2014 2015

Gro

ss P

rofi

t M

arg

in

15.3%

17.4%

18.9%

17.9%17.5% 17.6%

18.5%

2009 2010 2011 2012 2013 2014 2015

EB

ITD

A M

arg

in




THE SEG INTERNET INDEX: PUBLIC MARKET MULTIPLES (ANNUAL)

1.2x

1.6x

2.9x

2.1x

2.6x2.5x

1.8x

2009 2010 2011 2012 2013 2014 2015

Me

dia

n E

V/

RE

ve

nu

e M

ult

iple

10.0x11.8x

15.2x13.9x

20.8x

24.6x

17.0x

2009 2010 2011 2012 2013 2014 2015

Me

dia

n E

V/

EB

ITD

A M

ult

iple



THE SEG INTERNET INDEX: FINANCIAL PERFORMANCE (ANNUAL)

$216.2

$278.1

$333.0

$392.8

$440.2 $411.2

$492.9

2009 2010 2011 2012 2013 2014 2015

TT

M T

ota

l R

ev

en

ue

2.9% 3.4%

26.4%

23.9%

18.7%20.6%

17.5%

2009 2010 2011 2012 2013 2014 2015

TT

M R

ev

en

ue

Gro

wth

60.1%60.9%

66.2%65.0% 64.7%

63.8%63.2%

2009 2010 2011 2012 2013 2014 2015

Gro

ss P

rofi

t M

arg

in

10.2%

12.2%

13.1%

10.6%

8.9%8.3%

7.3%

2009 2010 2011 2012 2013 2014 2015

EB

ITD

A M

arg

in




THE SEG SaaS INDEX COMPANIES – KEY METRICS

61

SEG SaaS Index

Company EV/Revenue EV/EBITDA TTM Revenue Growth EBITDA Margin


2U 10.5x 7.1x 4.7x 6.7x 8.2x - - - - - 33.9% 32.0% 36.2% 37.6% 37.1% -20.0% -18.6% -16.6% -14.0% -12.2%

Alarm.com 4.4x 3.6x 3.3x 4.0x 4.9x 30.0x 22.6x 22.9x 27.3x 30.8x 25.4% 26.1% 24.8% 25.8% 25.8% 14.5% 15.9% 14.4% 14.8% 15.9%

Amber Road 1.9x 1.8x 10.4x 2.1x 3.7x - - - - - 11.4% 7.5% 3.5% 5.9% 4.6% -19.8% -27.6% -33.6% -30.0% -24.9%

Apigee Corporation 2.4x 2.4x 9.1x 2.9x 3.9x - - - - - 30.2% 26.6% 28.3% 32.1% 34.1% -68.6% -60.6% -53.3% -48.8% -41.8%

AppFolio 8.3x 7.5x 9.8x 5.1x 6.6x - - - - - - - 57.3% 53.4% 48.9% -17.1% -19.3% -16.1% -14.4% -11.9%

Appito, Inc - - 5.9x - 6.4x - - - - - - - 21.2% 21.2% 20.5% -24.7% -26.5% -25.9% -22.7% -21.0%

Athenahealth 6.5x 7.2x 0.8x 5.5x 5.0x 76.9x 92.5x 12.6x 67.5x 59.2x 24.2% 23.8% 22.9% 22.4% 21.2% 8.4% 7.8% 6.6% 8.1% 8.4%

Atlassian Corp - 16.0x 1.9x 10.3x 12.3x - 381.7x 46.9x 313.6x 652.3x 48.5% - - - 43.0% 3.4% 4.2% 4.1% 3.3% 1.9%

Bazaarvoice 2.0x 1.6x 3.6x 1.2x 1.5x - - - - - 11.7% 9.3% 6.1% 4.5% 3.6% -10.5% -9.1% -9.1% -7.5% -4.9%

Benefitfocus 6.5x 6.0x 4.0x 5.3x 5.7x - - - - - 33.6% 34.1% 34.7% 32.0% 33.0% -31.6% -27.5% -24.4% -22.3% -17.1%

Box 5.8x 4.9x 2.4x 4.1x 4.3x - - - - - - 45.5% 39.9% 38.2% 35.1% -58.1% -56.3% -54.3% -47.6% -41.0%

Callidus Software 5.2x 5.9x 4.0x 5.0x 5.5x - - 1889.4x - - 24.2% 27.8% 26.7% 25.0% 22.9% -3.3% -3.1% 0.2% 0.0% -0.1%

Castlight Health 6.8x 3.6x 9.3x 3.1x 3.4x - - - - - 121.2% 88.9% 65.1% 54.3% 42.5% -125.5% -115.4% -103.8% -93.6% -82.4%

ChannelAdvisors 2.4x 2.9x 7.2x 2.5x 2.5x - - - - - 18.6% 16.5% 18.5% 18.4% 17.1% -25.4% -19.6% -11.5% -6.7% -6.9%

Cornerstone OnDemand 6.5x 6.0x 2.2x 5.4x 6.3x - - - - - 35.7% 32.3% 28.9% 30.3% 29.3% -17.5% -18.5% -17.8% -16.1% -13.9%

Covisint 0.7x 0.5x 9.1x 0.5x 0.6x - - - - - -9.7% -10.6% -11.2% -14.1% -12.2% -26.8% -25.8% -24.9% -14.9% -13.0%

Cvent 7.0x 7.1x 4.0x 6.7x 5.7x 1950.4x 640.8x 657.1x 212.4x 144.7x 31.7% 31.8% 32.0% 30.9% 27.9% 0.4% 1.1% 0.6% 3.2% 3.9%

DealerTrack 2.6x 3.9x 21.6x 3.5x 2.5x 20.0x 28.2x 143.9x 21.5x 15.5x 60.3% 39.7% 41.8% 43.7% 43.7% 12.9% 13.7% 15.0% 16.1% 16.1%

Ebix 4.8x 4.9x 3.2x 6.2x 7.0x 13.5x 13.9x 8.6x 16.6x 18.6x 17.6% 25.1% 23.9% 20.3% 17.0% 35.5% 35.1% 36.8% 37.3% 37.4%

Ellie Mae 9.9x 7.8x 2.9x 9.1x 10.5x 45.2x 37.5x 15.5x 52.4x 57.9x 54.6% 62.2% 57.2% 48.9% 42.0% 21.9% 20.7% 18.9% 17.3% 18.1%

Everbridge, Inc - - 12.1x - 6.8x - - - - - - - 38.4% 35.5% 33.4% -3.0% -9.4% -14.0% -15.4% -16.1%

FireEye 12.0x 5.6x 1.1x 3.7x 3.4x - - - - - 97.4% 71.0% 46.4% 39.5% 30.9% -74.8% -67.1% -63.5% -61.7% -57.9%

Fleetmatics 6.5x 7.2x 2.4x 4.6x 7.0x 24.8x 28.9x 10.0x 20.2x 32.7x 27.0% 24.7% 23.0% 21.7% 20.2% 26.3% 24.9% 24.0% 22.8% 21.4%

Halogen Software 2.0x 1.4x 9.5x 1.6x 1.7x - - - - 361.0x 18.0% 17.4% 15.9% 14.2% 12.8% -13.9% -9.7% -6.0% -4.4% 0.5%

HealthStream 3.6x 3.0x 3.3x 2.7x 3.2x 25.3x 18.3x 26.9x 24.0x 28.1x 24.8% 22.2% 22.4% 20.3% 15.5% 14.1% 16.3% 12.1% 11.1% 11.2%

HortonWorks 11.9x 7.9x 5.8x 3.8x 2.7x - - - - - 106.4% 121.4% 164.8% 135.6% 99.0% -266.4% -221.4% -143.3% -140.1% -140.9%

HubSpot 10.4x 10.4x 4.1x 7.2x 8.2x - - - - - 55.3% 56.6% 57.0% 56.1% 54.3% -35.5% -33.2% -24.0% -20.6% -18.1%

inContact 2.3x 2.7x 3.2x 2.6x 3.5x - - - 403.9x 207.1x 36.1% 33.3% 29.2% 25.2% 23.1% -4.2% -2.5% -0.7% 0.6% 1.7%

Instructure - 8.6x 10.1x 5.2x 6.6x - - - - - - - 65.0% 62.5% 62.1% -92.5% -85.3% -67.9% -56.8% -51.7%

IntraLinks Holdings 2.5x 2.0x 3.0x 1.7x 2.0x 54.4x 51.3x 100.6x 43.7x 39.1x 9.7% 8.5% 7.9% 6.7% 6.1% 4.5% 3.9% 3.0% 4.0% 5.1%

J2 Global 5.3x 5.9x 1.3x 4.4x 4.4x 12.9x 14.2x 3.3x 10.8x 10.5x 20.7% 19.9% 20.3% 21.4% 21.0% 40.8% 41.4% 40.6% 41.1% 41.7%

Jive Software 1.3x 1.3x 4.3x 1.0x 1.1x - - - - - 18.0% 13.5% 9.6% 7.9% 6.2% -13.8% -11.8% -10.7% -9.6% -6.8%

LivePerson 2.1x 1.7x 4.0x 1.3x 1.7x 59.4x 26.8x 56.3x 18.9x 25.0x 20.5% 19.9% 13.9% 5.8% 0.8% 3.6% 6.2% 7.1% 7.0% 6.7%

Marin Software 1.0x 1.0x 9.6x 0.5x 0.6x - - - - - 19.5% 13.1% 9.2% 6.2% 2.3% -27.3% -25.2% -19.4% -14.4% -7.7%

Medical Transcript 1.0x 0.8x 50.2x 0.5x 0.6x - - - - - 126.9% 75.0% 26.1% 0.8% -15.6% -13.5% -7.0% -6.5% -5.9% -5.4%

Medidata Solutions 7.8x 6.3x 3.2x 6.0x 7.2x 76.2x 59.7x 31.0x 55.3x 59.1x 19.8% 19.5% 17.1% 15.2% 15.1% 10.2% 10.5% 10.2% 10.9% 12.2%

Mimecast - 4.5x 8.5x 2.6x 4.7x - 31.1x 84.4x 46.3x 225.8x - - - 22.2% 22.5% 10.9% 14.4% 10.1% 5.6% 2.1%


THE SEG SaaS INDEX COMPANIES – KEY METRICS

62

SEG SaaS Index



MINDBODY 6.2x 5.8x 12.2x 4.3x 5.1x - - - - - - - 44.8% 45.0% 41.4% -29.8% -27.4% -28.3% -24.1% -20.0%

NantHealth, Inc. - - 23.0x 27.6x 18.3x - - - - - - - 71.9% 70.9% 97.8% -145.7% -133.5% -109.1% -120.3% -143.8%

Netsuite 11.0x 9.6x 1.8x 7.7x 10.3x - - - - - 35.0% 34.9% 33.2% 32.6% 31.5% -9.1% -8.4% -8.3% -7.9% -7.0%

New Relic 11.7x 11.3x 7.6x 6.1x 8.0x - - - - - 73.2% 68.8% 67.5% 64.2% 60.2% -38.3% -36.2% -32.5% -32.4% -30.1%

Nutanix, Inc - - 4.0x - 11.8x - - - - - 89.9% - - 83.7% 84.3% -42.3% -39.1% -35.8% -33.7% -31.2%

Paycom Software 11.4x 11.3x 5.9x 9.0x 10.2x 55.4x 56.4x 31.3x 38.2x 43.3x 46.2% 48.4% 48.8% 53.4% 53.9% 20.6% 20.1% 18.7% 23.5% 23.6%

Paylocity Holding 10.8x 11.9x 6.2x 8.7x 9.5x - - - 374.4x 449.0x 40.5% 42.0% 46.7% 49.2% 51.1% -5.2% -3.6% -0.2% 2.3% 2.1%

Q2 Holdings 9.7x 9.0x 8.8x 7.2x 8.0x - - - - - 41.8% 38.5% 37.6% 37.0% 37.0% -15.1% -14.9% -14.8% -15.7% -16.4%

Qualys 6.5x 6.6x 7.1x 4.3x 5.2x 31.5x 29.8x 29.7x 17.6x 21.4x 24.1% 24.1% 23.0% 23.0% 22.5% 20.7% 22.3% 23.8% 24.6% 24.3%

RealPage 3.5x 3.7x 2.9x 3.7x 4.1x 44.0x 39.2x 25.6x 29.4x 30.5x 11.6% 14.1% 15.8% 17.4% 18.5% 7.9% 9.4% 11.3% 12.5% 13.3%

RingCentral 4.5x 5.2x 3.9x 3.9x 4.5x - - - - - 35.3% 35.1% 34.7% 34.0% 32.9% -10.6% -7.9% -5.5% -4.0% -2.7%

Salesforce.com 8.0x 8.3x 0.2x 7.5x 7.2x 150.8x 130.8x 2.2x 101.4x 96.2x 25.3% 24.2% 24.1% 25.0% 25.1% 5.3% 6.3% 7.0% 7.4% 7.5%

Service-now.com 13.6x 14.3x 1.0x 10.0x 9.9x - - - - - 54.0% 50.5% 47.3% 45.5% 42.9% -14.9% -12.5% -10.5% -9.3% -7.7%

Shopify 16.5x 11.6x 3.0x 9.2x 11.1x - - - - - - - 95.4% 94.7% 95.0% -7.2% -5.9% -5.9% -6.9% -7.4%

SPS Commerce 7.2x 7.2x 3.6x 4.6x 5.6x 72.9x 70.8x 34.3x 44.0x 55.9x 25.0% 25.8% 23.9% 22.9% 22.2% 9.8% 10.1% 10.5% 10.4% 10.1%

Tableau Software 12.4x 9.8x 0.7x 4.1x 4.4x - - - - - 71.4% 69.1% 58.4% 48.5% 41.0% -0.3% -1.4% -4.3% -8.4% -11.3%

Tabula Rasa Healthcare - - 6.1x - 3.7x - - 60.2x - 34.0x - - 44.6% 40.7% 35.9% 8.1% 9.1% 10.1% 10.6% 11.0%

Tangoe 1.3x 1.3x 1.9x 1.3x 1.4x 19.2x 30.5x 44.0x 29.0x 30.9x 8.3% 5.7% 5.7% 5.7% 5.7% 6.7% 4.4% 4.4% 4.4% 4.4%

The Trade Desk - - 4.3x - 8.2x - - 12.6x - 26.0x - - 155.5% - - 2.1% 2.1% 33.8% 30.7% 31.6%

The Ultimate Software Group 9.0x 9.4x 0.8x 8.4x 8.6x 74.2x 83.5x 7.6x 86.5x 90.5x 21.1% 20.8% 22.2% 24.7% 26.1% 12.2% 11.3% 10.3% 9.7% 9.5%

TrueCar 1.7x 2.0x 1.6x 1.8x 2.6x - - - - - 37.2% 31.6% 25.7% 18.9% 12.0% -16.1% -13.7% -14.3% -14.4% -12.9%

Twilio, Inc. - - 2.6x 13.2x 19.4x - - - - - - - 87.9% 86.6% 79.1% -24.8% -23.2% -19.9% -15.8% -13.9%

Upland Software 1.8x 1.7x 6.3x 2.0x 2.5x 556.4x 359.1x 643.0x 81.8x 53.0x 25.0% 14.2% 8.3% 5.2% 4.3% 0.3% 0.5% 1.0% 2.4% 4.6%

Veeva Systems 8.3x 8.2x 2.0x 7.7x 10.1x 34.2x 34.6x 9.3x 38.9x 52.2x 37.9% 32.2% 30.6% 30.5% 31.6% 24.4% 23.8% 21.6% 19.9% 19.4%

Workday 13.6x 13.2x 0.4x 10.8x 10.9x - - - - - 58.2% 51.4% 47.5% 43.0% 38.7% -15.8% -15.6% -15.6% -15.5% -15.5%

Workiva 4.1x 4.8x 2.2x 3.0x 4.0x - - - - - 27.8% 27.7% 28.9% 29.2% 28.7% -29.3% -28.8% -27.0% -28.8% -27.8%

Xactly 3.1x 3.2x 2.7x 2.6x 4.3x - - - - - - 20.9% 24.3% 27.9% 29.7% -19.8% -20.2% -21.5% -21.0% -18.4%


CRM & Marketing 3Q15 4Q15 1Q16 2Q16 3Q16




EV/TTM CFO 31.3x 43.5x 32.4x 19.8x 25.8x


EBITDA Margin -10.5% -9.1% -9.1% -7.5% -4.9%


TTM Revenue Growth (YoY) 25.3% 24.2% 24.1% 25.0% 25.1%

TTM EBITDA Growth (YoY) -10.5% 0.3% 22.3% 50.5% 71.1%

TTM Earnings Growth (YoY) 26.9% 14.3% -4.5% -8.6% -14.6%

Cash as Percent of Market Cap 12.6% 12.3% 14.2% 12.6% 11.9%

Enterprise Value Growth (YoY) -3.5% 11.9% -12.3% 7.3% 10.6%

ERP & Supply Chain 3Q15 4Q15 1Q16 2Q16 3Q16




EV/TTM CFO 78.9x 70.5x 65.6x 37.1x 46.4x


EBITDA Margin -9.1% -8.4% -8.3% -7.9% -7.0%



TTM EBITDA Growth (YoY) 16.9% 16.2% 7.6% -0.1% -1.0%

TTM Earnings Growth (YoY) 31.7% 22.7% 41.2% 61.7% 63.8%


Enterprise Value Growth (YoY) 20.1% 16.4% -21.1% -15.7% 17.8%

Vertically Focused 3Q15 4Q15 1Q16 2Q16 3Q16




EV/TTM CFO 31.6x 26.3x 26.0x 20.7x 32.3x


EBITDA Margin 8.0% 8.4% 8.3% 9.4% 9.7%



TTM EBITDA Growth (YoY) 6.1% 12.3% 12.3% 15.3% 19.6%



Enterprise Value Growth (YoY) 15.5% 26.3% 6.2% 14.0% 13.2%

Human Capital Management 3Q15 4Q15 1Q16 2Q16 3Q16




EV/TTM CFO 56.9x 54.6x 49.5x 37.1x 48.3x


EBITDA Margin -9.6% -6.7% -3.1% -2.2% 0.2%



TTM EBITDA Growth (YoY) -15.6% -24.6% 12.9% 12.9% 13.0%

TTM Earnings Growth (YoY) 28.4% -0.5% -17.1% -33.7% -28.7%



Other SaaS 3Q15 4Q15 1Q16 2Q16 3Q16




EV/TTM CFO 31.1x 37.0x 42.2x 28.7x 33.8x


EBITDA Margin -12.2% -10.6% -10.6% -8.8% -7.5%




TTM Earnings Growth (YoY) -49.5% 15.5% 14.4% 19.6% -12.0%


Enterprise Value Growth (YoY) 30.8% -0.3% -26.7% -20.1% 0.6%

THE SEG SaaS INDEX METRICS BY PRODUCT CATEGORY

63


SEG Software Index



A10 Networks 1.7x 1.7x 1.4x 1.4x 2.1x - - - - - 4.2% 6.2% 10.8% 17.4% 21.2% -19.7% -18.0% -13.8% -10.8% -9.2%

Accretive Health - - - - - - - - - - -1.7% -60.9% -44.2% 120.3% 159.9% -17.9% -154.3% -100.9% 46.1% 44.7%

ACI Worldwide 3.3x 3.4x 2.9x 3.0x 2.9x 16.4x 17.5x 17.2x 20.5x 28.0x 6.7% 1.8% 2.9% 1.1% -4.3% 20.2% 19.3% 16.7% 14.6% 10.5%

Activision Blizzard 4.3x 5.4x 5.4x 6.3x 6.2x 14.1x 16.4x 17.9x 19.3x 22.1x 8.4% 12.3% 5.8% 5.8% 15.4% 30.7% 32.8% 30.4% 32.9% 28.3%

Allot Communications 0.5x 0.6x 0.4x 0.5x 0.5x - - - - - 3.9% -7.6% -14.7% -21.2% -15.3% -0.8% -3.3% -4.3% -9.6% -4.9%

Allscripts Healthcare Solutions 2.3x 2.4x 2.1x 2.2x 2.7x 37.1x 35.2x 26.3x 24.1x 29.1x 0.0% -0.5% 0.6% 1.8% 4.3% 6.2% 6.9% 8.1% 8.9% 9.3%

Amdocs Limited 2.1x 2.1x 2.0x 2.0x 2.1x 10.6x 10.7x 10.6x 10.9x 10.5x 3.1% 2.2% 1.5% 2.0% 2.4% 19.4% 19.3% 18.9% 18.6% 19.5%

American Software 1.9x 2.1x 1.8x 1.7x 2.2x 15.1x 15.1x 13.5x 13.1x 18.9x 4.6% 11.6% 11.3% 10.7% 5.2% 12.5% 13.7% 13.5% 13.4% 11.6%

ANSYS 7.9x 7.9x 7.3x 7.3x 7.5x 17.3x 17.3x 15.9x 15.9x 16.4x 5.1% 3.0% 0.7% 1.3% 2.1% 46.0% 45.6% 45.8% 45.7% 45.8%

Aspen Technology 7.2x 7.2x 5.7x 6.6x 7.3x 17.2x 16.6x 12.8x 14.2x 15.6x 12.5% 10.4% 10.7% 10.5% 7.3% 41.9% 43.1% 44.4% 46.4% 47.0%

Autodesk 4.1x 5.1x 4.4x 5.2x 5.8x 52.2x 75.7x 74.7x 442.0x - 7.1% 3.5% -0.3% -7.7% -9.0% 7.9% 6.8% 5.9% 1.2% -1.2%

AVG Technologies 3.6x 2.8x 2.6x 2.5x 3.2x 11.8x 9.7x 8.6x 8.5x 11.0x 5.1% 11.5% 14.5% 13.1% 6.8% 30.1% 29.0% 30.4% 29.6% 29.0%

Bango PLC 17.3x 19.7x 11.0x 5.8x 12.9x - - - - - -63.3% -61.4% -37.2% -14.6% 28.5% -182.0% -196.9% -142.1% -143.6% -144.9%

Barracuda Networks 4.2x 2.5x 1.6x 2.1x 3.0x 256.7x 222.6x 60.3x 41.8x 60.1x 17.4% 16.2% 15.4% 13.7% 13.7% 1.6% 1.1% 2.6% 5.0% 5.0%

Blackbaud 4.9x 5.1x 4.7x 5.0x 5.2x 30.1x 31.7x 28.8x 30.0x 31.0x 13.4% 12.5% 13.0% 13.1% 13.9% 16.3% 16.0% 16.4% 16.7% 16.6%

Bottomline Technologies 3.2x 3.3x 3.3x 3.0x 2.6x 26.1x 27.0x 27.3x 23.9x 22.6x 10.1% 5.6% 3.9% 4.1% 3.7% 12.1% 12.4% 12.1% 12.7% 11.6%

Broadridge Financial 2.5x 2.6x 2.5x 2.7x 2.9x 11.7x 12.1x 11.9x 12.8x 13.8x 5.3% 6.4% 6.7% 7.6% 7.5% 21.3% 21.2% 21.2% 21.3% 21.1%

Brocade Communications Systems 1.7x 1.6x 1.4x 1.5x 1.7x 6.4x 6.3x 5.5x 6.1x 8.0x 1.5% 2.4% 1.7% 0.3% 1.7% 26.2% 25.7% 25.0% 24.1% 21.5%

BSQUARE 0.5x 0.5x 0.4x 0.4x 0.3x 7.8x 8.4x 5.5x 7.0x 9.0x 10.6% 11.5% 11.1% 6.4% -5.3% 6.0% 6.6% 6.6% 5.5% 3.9%

CA 2.7x 2.8x 2.9x 3.1x 3.4x 8.5x 8.9x 9.5x 9.9x 10.9x -4.9% -6.1% -6.6% -5.6% -2.9% 32.0% 30.9% 30.5% 31.2% 30.6%

Cadence Design Systems 3.4x 3.6x 3.4x 4.0x 4.1x 14.4x 15.0x 14.4x 16.1x 17.3x 10.0% 9.7% 7.7% 7.7% 7.6% 23.6% 23.7% 24.0% 24.7% 23.8%

Cerner 5.8x 5.1x 4.3x 4.2x 4.6x 20.2x 18.1x 15.4x 15.0x 16.6x 24.0% 29.0% 31.4% 27.4% 20.1% 28.5% 28.0% 27.7% 27.9% 27.7%

Check Point Software Tech 8.5x 8.6x 8.2x 7.9x 7.0x 15.8x 16.2x 15.8x 15.3x 13.7x 8.6% 8.9% 9.0% 8.9% 8.3% 53.5% 52.9% 52.3% 51.6% 51.0%

Cisco Systems 2.1x 2.1x 2.0x 2.1x 2.4x 7.5x 7.4x 6.6x 7.1x 8.1x 4.3% 4.9% 3.1% 1.6% 0.2% 28.6% 28.6% 29.9% 30.2% 30.1%

Citrix Systems 3.7x 3.8x 3.4x 3.9x 3.9x 16.3x 17.1x 13.2x 13.9x 13.8x 4.0% 4.2% 4.2% 6.0% 6.9% 22.6% 22.1% 25.9% 27.9% 28.5%

CommVault Systems 2.2x 2.4x 2.2x 2.6x 3.1x 46.1x 104.4x 154.7x 121.7x 115.4x -1.7% -4.9% -4.5% -2.0% 2.4% 4.7% 2.3% 1.4% 2.2% 2.7%

Computer Programs and Sys 2.5x 2.5x 3.3x 3.3x 2.2x 11.1x 13.1x 18.2x 19.3x 14.7x -5.1% -12.2% -11.0% 3.4% 17.6% 22.5% 19.1% 18.3% 17.2% 15.2%

Constellation 5.3x 5.2x 4.5x 4.5x 4.5x 31.0x 29.3x 19.3x 19.4x 19.3x 17.6% 12.5% 10.1% 12.1% 15.2% 17.2% 17.7% 23.2% 23.2% 23.5%

CSG Systems International 1.5x 1.6x 1.7x 2.0x 2.0x 9.2x 9.3x 8.7x 9.7x 9.2x -0.8% -0.4% 0.2% 0.6% 1.8% 16.3% 17.5% 19.4% 20.8% 21.6%

Cyberark Software 11.7x 8.1x 6.5x 6.7x 8.2x 48.8x 35.9x 29.7x 33.3x 40.3x 76.5% 67.9% 56.1% 47.5% 41.4% 24.0% 22.7% 21.8% 20.1% 20.3%

Cyren 2.2x 2.2x 1.7x 2.2x 2.7x - - - - - -10.2% -11.9% -13.0% -8.6% -1.0% -7.3% -10.4% -5.9% -5.5% -6.3%

Dassault Systèmes 6.0x 6.2x 5.8x 5.6x 6.0x 23.2x 23.4x 21.4x 20.4x 23.3x 22.9% 24.2% 23.8% 17.8% 12.1% 25.8% 26.5% 27.2% 27.3% 26.0%

DST Systems 2.0x 2.2x 1.5x 1.6x 1.6x 11.3x 13.3x 10.2x 11.5x 11.2x -21.5% -21.4% 2.8% 17.7% 36.7% 17.8% 16.7% 14.3% 14.0% 14.4%

Electronic Arts 4.4x 4.5x 4.0x 4.5x 4.9x 15.3x 17.2x 18.2x 18.2x 19.3x 17.3% 4.7% -4.0% -2.6% -0.9% 28.5% 26.3% 22.0% 24.5% 25.2%

EPIQ Systems 2.0x 1.9x 1.7x 1.8x 1.9x 15.1x 14.6x 11.0x 11.8x 11.5x -2.5% 4.7% 13.9% 21.6% 17.5% 13.2% 12.9% 15.5% 14.9% 16.5%

Evertec 5.7x 5.2x 4.5x 4.5x 4.9x 13.6x 12.5x 11.3x 11.5x 13.0x 2.1% 2.8% 3.2% 3.2% 3.8% 41.8% 41.5% 39.7% 39.1% 38.1%

Evolving Systems 2.3x 2.4x 2.4x 2.6x 2.0x 8.4x 10.2x 11.5x 11.8x 7.9x 2.7% -8.9% -13.8% -14.7% -8.9% 27.2% 23.9% 21.2% 22.1% 25.6%

THE SEG SOFTWARE INDEX COMPANIES – KEY METRICS

64


SEG Software Index



F5 Networks 4.2x 3.4x 3.0x 3.3x 3.7x 13.1x 11.1x 9.8x 10.9x 12.5x 13.3% 10.8% 8.8% 6.4% 4.6% 31.6% 31.0% 30.5% 29.9% 29.7%

Fair Isaac 4.1x 4.0x 4.2x 4.6x 5.0x 18.2x 17.8x 18.1x 19.8x 20.7x 9.2% 6.3% 6.9% 4.0% 6.1% 22.3% 22.6% 23.0% 23.3% 24.2%

FalconStor Software 1.1x 1.4x 1.2x 1.4x 1.2x 224.4x 26527.6x 159.3x - - -0.4% 3.8% 5.0% -33.5% -34.1% 0.5% 0.0% 0.7% -29.1% -32.0%

Fidessa 2.4x 2.3x 2.5x 2.7x 2.8x 13.3x 13.4x 14.5x 16.0x 16.6x 2.5% 5.0% 7.4% 8.0% 8.5% 17.7% 17.5% 17.0% 17.0% 17.0%

First Data Corp - 5.0x 4.4x 4.3x 4.3x - 14.9x 14.4x 14.1x 14.2x 3.4% 3.5% 2.9% 2.7% 2.6% 33.0% 33.7% 30.6% 30.2% 30.3%

Fiserv 4.7x 4.9x 4.9x 5.1x 5.0x 15.3x 15.9x 15.9x 16.6x 16.2x 4.1% 3.8% 3.7% 4.0% 4.3% 30.5% 30.8% 30.5% 30.8% 31.1%

Fortinet 7.7x 5.4x 3.9x 4.3x 4.4x 102.4x 85.6x 70.8x 83.0x 95.2x 27.0% 29.4% 31.0% 32.7% 32.5% 7.5% 6.3% 5.5% 5.2% 4.7%

Gigamon 3.3x 3.3x 2.9x 3.6x 5.1x 54.5x 42.6x 38.0x 41.4x 50.1x 38.4% 41.3% 41.3% 40.7% 40.9% 6.1% 7.7% 7.7% 8.7% 10.2%

Glu Mobile 1.6x 1.0x 0.8x 0.7x 0.6x 34.2x 18.2x 31.9x - - 85.3% 41.4% 12.0% -5.3% -13.7% 4.7% 5.3% 2.5% -2.4% -4.8%

Gree 0.8x 0.7x 0.7x 0.9x 0.6x 3.0x 2.7x 2.8x 3.6x 2.7x -26.4% -25.4% -25.0% -23.4% -24.4% 27.3% 26.3% 24.8% 26.3% 22.8%

Gridsum Holding Inc. - - - - 12.0x - - - - - - - 88.6% 83.2% 79.2% -18.2% -15.7% -13.9% -11.4% -9.4%

GSE Systems 0.3x 0.3x 0.5x 0.5x 0.6x - - 25.8x 20.0x 11.6x 17.2% 49.2% 51.3% 30.2% 13.1% -5.3% -1.6% 1.8% 2.7% 5.5%

Guidance Software 2.2x 1.5x 1.2x 1.4x 1.6x - - - - - -0.2% -0.7% -1.5% -0.4% -0.8% -3.4% -4.3% -7.2% -8.9% -11.2%

Guidewire Software 8.8x 9.5x 8.2x 8.7x 9.2x 147.5x 209.7x 151.4x 156.0x 157.5x 8.6% 5.4% 7.1% 9.8% 11.5% 5.9% 4.5% 5.4% 5.5% 5.8%

Hewlett Packard 0.9x 0.3x 0.2x 0.2x 0.3x 6.1x 2.8x 2.2x 2.4x 2.8x -39.7% -7.3% 4.7% 21.2% 47.8% 14.4% 11.8% 10.9% 10.1% 9.4%

IBM 2.1x 2.0x 2.0x 2.2x 2.3x 8.1x 7.7x 7.9x 9.2x 10.4x -10.4% -12.8% -11.9% -10.3% -7.7% 25.7% 25.6% 24.6% 23.5% 22.4%

Imperva 9.4x 8.8x 5.4x 4.3x 4.9x - - - - - 30.1% 37.1% 42.9% 40.7% 31.9% -29.3% -22.5% -18.5% -19.1% -21.1%

Intuit 6.4x 6.0x 5.8x 5.9x 6.0x 24.8x 22.2x 19.8x 19.2x 19.4x -1.2% 1.4% 6.4% 17.5% 12.0% 25.9% 27.2% 29.1% 30.5% 31.1%

Jack Henry & Associates 4.4x 4.8x 5.0x 5.0x 5.1x 12.9x 13.7x 14.1x 14.4x 14.7x 7.1% 6.6% 6.4% 6.8% 7.8% 34.2% 35.1% 35.0% 34.8% 34.8%

Juniper Networks 2.2x 2.5x 2.0x 1.8x 1.8x 11.4x 11.7x 9.0x 8.1x 8.2x -7.0% -3.3% 5.0% 8.0% 8.2% 19.6% 21.1% 22.2% 22.4% 21.8%

Konami 1.4x 1.5x 1.4x 1.8x 1.8x 9.6x 9.8x 7.4x 8.3x 8.1x 0.1% 4.0% 11.0% 14.6% 12.4% 14.8% 15.6% 18.6% 21.5% 22.5%

Magic Software Enterprises 1.2x 1.0x 1.2x 1.3x 1.4x 6.7x 5.9x 6.5x 7.3x 8.2x 4.5% 4.7% 7.1% 10.2% 11.9% 17.9% 17.2% 18.0% 17.4% 17.1%

Manhattan Associates 8.4x 9.4x 7.1x 7.7x 7.1x 29.8x 32.5x 23.5x 25.0x 22.2x 17.1% 16.2% 13.1% 11.8% 11.3% 28.4% 29.0% 30.4% 30.7% 31.8%

Mentor Graphics 2.3x 2.3x 1.7x 1.9x 2.2x 10.1x 10.3x 9.2x 11.6x 15.8x 8.1% 6.4% -5.1% -10.1% -13.6% 22.9% 22.4% 18.9% 16.3% 13.6%

Microsoft 3.2x 4.1x 4.0x 4.0x 4.5x 8.8x 11.4x 11.7x 11.9x 14.3x 7.8% -0.8% -5.7% -8.3% -8.8% 35.9% 35.7% 34.6% 33.5% 31.8%

MicroStrategy 3.3x 2.9x 2.7x 3.0x 2.7x 16.0x 11.1x 9.5x 11.0x 10.7x -5.2% -10.3% -8.6% -7.2% -7.5% 20.8% 26.2% 28.0% 27.4% 25.0%

MIND C.T.I. 1.5x 1.5x 1.4x 1.3x 1.4x 4.5x 4.5x 4.3x 4.2x 4.9x 10.7% -4.1% -16.4% -20.9% -20.9% 34.2% 34.1% 31.5% 31.1% 28.6%

MobileIron 1.8x 1.5x 1.3x 1.2x 1.1x - - - - - 23.3% 17.3% 12.9% 11.8% 12.1% -52.2% -56.3% -46.2% -43.9% -41.3%

Model N 2.0x 2.0x 2.1x 2.3x 2.2x - - - - - -0.6% 14.7% 16.8% 18.0% 17.1% -16.9% -16.1% -18.5% -22.2% -24.4%

Momo 22.1x 14.9x 11.1x 11.2x 10.3x - 354.6x 120.9x 137.3x 83.8x 416.7% 296.5% 199.4% 141.6% 158.0% -9.7% 4.2% 9.2% 8.2% 12.3%

Monotype Imaging Holdings 4.5x 4.7x 4.3x 4.2x 3.6x 16.3x 17.8x 15.5x 15.7x 13.6x 6.5% 3.9% 4.3% 6.4% 6.8% 27.5% 26.5% 27.5% 26.7% 26.7%

MSCI 7.0x 7.3x 7.1x 7.7x 8.3x 16.8x 16.8x 15.9x 16.5x 17.3x 8.0% 7.2% 7.9% 7.0% 7.2% 41.7% 43.6% 44.8% 46.5% 48.1%

Myriad Group AG 13.8x 9.0x 10.9x 13.2x 16.8x - - - - - -17.3% -24.4% -32.1% -41.3% -51.6% -3.4% -27.2% -55.1% -88.7% -141.3%

NetApp 0.9x 1.0x 0.6x 0.7x 0.9x 7.1x 7.9x 5.3x 6.2x 7.1x -5.2% -6.7% -8.4% -9.4% -7.8% 13.3% 12.5% 12.1% 11.4% 13.1%

Netscout Systems 7.9x 5.4x 2.5x 2.3x 2.3x 33.3x 41.4x 23.8x 30.8x 30.6x 5.6% 39.1% 76.6% 110.6% 151.6% 23.8% 13.0% 10.5% 7.3% 7.6%

NetSol Technologies 1.5x 1.4x 1.6x 1.5x 1.3x 9.0x 7.0x 6.3x 6.1x 6.9x 41.3% 51.2% 49.7% 35.4% 22.8% 16.9% 19.3% 24.9% 24.2% 19.3%

NeuStar 1.9x 1.7x 2.1x 2.1x 2.1x 5.0x 4.4x 5.6x 5.8x 5.6x 7.7% 7.7% 9.0% 10.2% 12.2% 39.1% 39.8% 38.1% 36.5% 36.3%


65



66

SEG Software Index



NICE Systems Ltd 3.4x 3.0x 3.5x 3.7x 3.8x 17.1x 14.5x 14.4x 14.9x 15.9x 7.4% 6.5% 6.3% -9.0% -8.7% 19.7% 20.8% 24.1% 24.7% 24.1%

NQ Mobile 0.9x 1.0x 0.9x 1.1x 1.1x - - - - 103.8x 27.7% 18.8% 22.4% 14.4% 2.9% -9.7% -4.0% -2.9% -0.5% 1.0%

Nuance Communications, Inc. 3.6x 3.7x 3.8x 3.4x 3.1x 30.3x 29.0x 24.7x 21.8x 18.9x 1.9% 0.4% 0.8% 1.0% 0.9% 11.9% 12.8% 15.3% 15.7% 16.3%

Omnicell 2.6x 2.1x 1.9x 2.4x 2.6x 18.5x 14.9x 13.9x 20.2x 21.9x 13.9% 11.9% 9.9% 18.4% 29.4% 14.0% 13.9% 13.4% 12.0% 11.7%

Open Text Corp 3.5x 3.6x 3.7x 4.1x 4.6x 12.3x 13.0x 12.8x 13.5x 14.8x 14.0% 4.5% -1.5% -2.1% -1.5% 28.1% 27.8% 28.8% 30.5% 31.3%

Opera 1.7x 1.6x 1.9x 1.9x 1.7x 9.5x 9.9x 13.5x 14.4x 14.6x 60.6% 38.7% 28.1% 25.4% 18.2% 18.1% 16.1% 14.3% 13.5% 11.7%

Oracle 4.1x 4.0x 3.9x 4.2x 4.2x 10.0x 9.8x 9.6x 10.5x 10.8x -1.1% -3.5% -4.3% -3.1% -2.3% 41.5% 40.7% 40.2% 39.8% 39.3%

Palo Alto Networks 15.6x 13.9x 11.0x 9.5x 8.3x - - - - - 55.1% 56.0% 55.6% 53.4% 48.5% -11.3% -10.5% -10.6% -11.1% -10.7%

Pandora Media 3.3x 2.3x 1.7x 1.8x 2.4x - - - - - 28.0% 26.0% 26.4% 28.6% 25.8% -3.7% -3.4% -5.8% -9.1% -12.3%

Parametric Technology 3.4x 3.5x 3.3x 3.9x 4.5x 17.1x 17.3x 16.9x 23.1x 31.6x -1.9% -7.5% -10.1% -12.2% -11.0% 20.0% 20.2% 19.3% 16.8% 14.3%

PDF Solutions 2.8x 2.2x 2.0x 3.0x 4.0x 10.4x 7.9x 8.6x 16.8x 22.2x -5.5% -1.2% -2.2% -3.7% 1.2% 26.6% 27.3% 23.9% 18.2% 18.0%

Pegasystems 2.7x 3.0x 2.4x 2.5x 2.6x 21.9x 23.5x 18.6x 19.7x 20.2x 11.4% 12.7% 15.7% 17.3% 18.0% 12.1% 12.6% 12.9% 12.9% 12.8%

Progress Software 3.9x 3.0x 3.0x 3.0x 3.3x 19.2x 15.5x 13.5x 12.3x 12.7x 11.4% 13.5% 13.6% 13.1% 10.4% 20.1% 19.2% 22.2% 24.4% 25.6%

Proofpoint 10.8x 10.6x 7.7x 8.0x 9.9x - - - - - 38.5% 36.8% 35.7% 36.1% 37.4% -17.8% -18.8% -20.9% -21.4% -19.1%

PROS Holdings 3.2x 3.6x 1.8x 2.0x 3.4x - - - - - 15.5% 5.4% -9.5% -13.8% -15.1% -9.6% -16.6% -25.1% -29.8% -33.9%

QAD 1.2x 1.2x 0.9x 0.9x 0.9x 16.4x 18.5x 16.4x 20.8x 28.0x 4.8% -0.3% -5.8% -7.4% -7.4% 7.3% 6.6% 5.3% 4.1% 3.2%

Qihoo 360 Technology 4.9x 4.9x 5.3x 5.3x 5.2x 18.0x 19.7x 25.2x 25.0x 24.7x 64.2% 47.7% 29.8% 29.8% 29.8% 27.0% 25.1% 21.1% 21.1% 21.1%

Qiwi 4.5x 3.2x 2.1x 2.1x 2.0x 14.1x 10.8x 7.0x 7.3x 6.6x 24.1% 22.8% 20.4% 16.0% 12.3% 32.1% 29.9% 30.2% 29.3% 29.9%

Quality Systems 1.4x 1.6x 1.6x 1.6x 1.6x 13.0x 13.9x 14.1x 13.7x 14.2x 9.2% 8.0% 3.3% 0.5% -0.4% 10.5% 11.5% 11.6% 11.6% 11.5%

Radware 3.5x 2.7x 1.9x 1.6x 1.8x 16.9x 15.0x 13.1x 17.1x 37.2x 12.7% 4.0% -2.4% -8.9% -12.9% 20.4% 18.0% 14.2% 9.3% 4.9%

Rapid7 11.3x 7.3x 4.1x 3.6x 4.5x - - - - - - - 43.8% 45.4% 45.4% -26.4% -27.5% -35.6% -39.3% -39.4%

Red Hat 7.2x 7.2x 6.1x 6.1x 5.7x 37.8x 38.5x 33.8x 35.0x 33.1x 14.3% 14.3% 14.7% 15.8% 17.3% 19.0% 18.6% 17.9% 17.5% 17.1%

Redknee Solutions 1.2x 1.1x 0.9x 0.9x 1.0x 11.3x 9.8x 9.7x 25.6x 609.8x -11.9% -13.6% -19.1% -18.6% -15.1% 10.9% 11.4% 9.3% 3.5% 0.2%

Sage Group 4.1x 4.5x 4.5x 4.7x 5.0x 15.3x 16.4x 16.7x 17.6x 18.9x 9.0% 6.1% 4.8% 3.6% 3.6% 26.7% 27.1% 26.9% 26.7% 26.7%

SAP 4.2x 4.5x 4.4x 4.1x 4.6x 13.5x 14.5x 16.0x 14.8x 16.4x 12.8% 15.7% 18.4% 14.5% 11.0% 31.1% 31.0% 27.5% 27.7% 28.2%

Sapiens International 3.0x 2.7x 2.6x 2.7x 2.8x 21.7x 18.1x 16.6x 17.6x 18.7x 14.1% 17.7% 17.9% 18.2% 19.0% 13.8% 14.9% 15.4% 15.2% 14.9%

SecureWorks - - - 3.0x 2.6x - - - - - - - 29.5% 29.8% 30.6% -15.4% -17.8% -17.8% -15.8% -10.9%

Silver Spring Networks 1.5x 1.6x 1.0x 1.4x 1.3x - 20.2x 5.1x 12.0x 6.6x 27.7% 74.2% 155.9% 35.7% 34.7% -2.4% 7.9% 20.1% 11.5% 20.0%

Software AG 2.4x 2.3x 2.7x 2.8x 3.1x 8.9x 8.1x 9.1x 9.1x 9.8x -6.8% -2.2% 1.8% 5.0% 3.6% 26.9% 28.6% 29.8% 30.9% 31.3%

Sourcefire 0.9x 1.2x 1.2x 1.2x 1.2x 8.4x 7.9x 7.9x 7.9x 9.1x 5.6% 27.2% 33.9% 37.6% 31.2% 10.9% 15.5% 15.7% 14.7% 12.8%

Splunk 14.3x 10.9x 7.6x 8.0x 8.7x - - - - - 46.8% 47.7% 48.3% 48.5% 47.6% -41.9% -41.5% -39.9% -39.9% -38.7%

Square - 3.9x 2.9x 2.0x 2.3x - - - - - - - 49.0% 52.6% 46.7% -8.2% -8.0% -7.5% -7.2% -6.0%

SS&C 8.0x 10.2x 8.4x 7.6x 7.0x 20.9x 31.2x 25.6x 23.3x 21.9x 10.2% 20.1% 30.3% 42.0% 57.5% 38.2% 32.7% 32.9% 32.7% 31.7%

Stratasys 1.6x 1.4x 1.1x 1.3x 1.3x 25.7x 35.9x - 277.0x 35.5x 27.2% 7.5% -7.2% -10.5% -12.2% 6.2% 4.0% -1.6% 0.5% 3.7%

Symantec 4.1x 1.9x 1.9x 2.5x 3.1x 32.0x 6.5x 6.0x 10.0x 12.0x -53.3% 15.2% 32.0% -9.0% 14.0% 13.0% 29.7% 31.5% 24.8% 26.1%

Synchronoss Technologies 3.8x 3.0x 2.4x 2.9x 3.3x 13.6x 10.4x 8.8x 11.9x 15.1x 35.3% 30.1% 26.6% 19.7% 15.6% 28.0% 28.5% 27.2% 24.5% 21.8%

Synopsys 3.2x 2.9x 2.7x 3.0x 3.3x 16.7x 16.0x 15.3x 17.0x 18.6x 8.4% 9.0% 7.0% 7.2% 8.3% 18.8% 18.4% 17.7% 17.6% 17.6%



67

SEG Software Index



Take-Two Interactive 1.5x 1.6x 1.7x 1.7x 2.0x - - - 26.6x 23.7x -47.2% -37.1% 36.7% 30.5% 17.6% -21.3% -10.0% -15.8% 6.3% 8.4%

Talend - - - - 8.2x - - - - - 17.9% 17.9% 21.4% - n/a -34.9% -34.9% -26.7% -24.6% -26.7%

Tangoe 1.3x 1.3x 1.3x 1.3x 1.4x 19.2x 30.5x 29.0x 29.0x 30.9x 8.3% 5.7% 5.7% 5.7% 5.7% 6.7% 4.4% 4.4% 4.4% 4.4%

TeleNav 1.0x 1.0x 0.7x 0.6x 0.7x - - - - - 6.6% 20.1% 21.7% 18.1% 14.4% -20.0% -19.3% -18.3% -18.4% -14.9%

Teradata 1.5x 1.4x 1.3x 1.3x 1.5x 8.2x 8.3x 8.6x 8.6x 9.6x -3.9% -6.1% -7.4% -7.2% -6.2% 18.5% 17.2% 14.9% 15.2% 15.3%

The Descartes Systems Group 6.5x 7.7x 6.9x 7.5x 7.7x 21.4x 24.5x 21.6x 23.0x 23.6x 8.8% 8.6% 8.3% 8.6% 10.1% 30.6% 31.3% 32.0% 32.5% 32.7%

Trend Micro 3.9x 4.2x 3.9x 3.4x 3.0x 11.3x 12.4x 12.3x 10.8x 9.8x 8.8% 9.3% 7.9% 5.7% 3.3% 34.3% 33.9% 31.6% 31.9% 31.1%

Tyler Technologies 8.4x 10.0x 7.9x 8.5x 9.0x 37.4x 44.4x 36.3x 40.5x 44.2x 18.2% 17.5% 19.9% 23.3% 26.2% 22.5% 22.6% 21.8% 21.0% 20.4%

Ubisoft Entertainment 1.3x 2.5x 2.3x 2.4x 2.7x 35.9x - 10.6x 17.9x 20.6x 20.2% -0.9% -3.0% -4.8% -4.8% 3.5% -7.7% 21.7% 13.3% 13.3%

Varonis Systems 3.7x 2.7x 2.8x 3.5x 4.3x - - - - - 29.1% 25.5% 25.5% 26.0% 29.4% -19.3% -17.8% -13.7% -12.3% -10.7%

VASCO Data Security International 2.4x 2.2x 1.8x 2.4x 2.7x 9.6x 9.7x 8.0x 13.3x 20.7x 45.4% 38.7% 19.8% -2.1% -13.7% 24.5% 22.4% 22.6% 18.2% 12.9%

Verint Systems Inc 3.3x 2.8x 2.3x 2.2x 2.4x 23.4x 19.7x 18.7x 20.3x 22.0x 14.3% 8.3% 0.2% -3.0% -7.5% 14.3% 14.0% 12.3% 10.9% 10.9%

Verisk 9.0x 8.7x 7.4x 7.4x 7.2x 18.7x 17.7x 16.3x 16.2x 15.8x 3.9% 7.6% 18.4% 26.4% 30.1% 48.1% 49.3% 45.7% 45.6% 45.3%

VMWare 4.7x 3.0x 2.3x 2.7x 3.5x 19.1x 11.9x 8.5x 10.2x 12.9x 13.2% 11.5% 10.1% 8.7% 7.8% 24.4% 24.9% 26.7% 26.1% 26.9%

Zynga 1.8x 1.7x 1.2x 1.8x 2.1x - - - - - 7.5% 14.4% 10.8% 8.9% -0.3% -13.6% -8.6% -6.4% -4.7% -2.7%


Enterprise Resource Planning 3Q15 4Q15 1Q16 2Q16 3Q16




EV/TTM CFO 14.3x 15.7x 14.9x 11.7x 21.3x


EBITDA Margin 26.7% 27.1% 26.9% 26.7% 26.7%



TTM EBITDA Growth (YoY) -0.6% -2.7% -4.4% -0.4% -6.4%

TTM Earnings Growth (YoY) -8.8% 3.4% -6.6% -10.4% -5.4%



Financial & Accounting 3Q15 4Q15 1Q16 2Q16 3Q16




EV/TTM CFO 18.6x 19.9x 19.0x 21.7x 16.8x


EBITDA Margin 22.3% 22.6% 24.9% 24.2% 24.2%



TTM EBITDA Growth (YoY) 2.7% 2.9% -1.8% -0.4% -5.6%

TTM Earnings Growth (YoY) 2.5% -2.7% -2.4% 6.7% 24.2%



Gaming 3Q15 4Q15 1Q16 2Q16 3Q16




EV/TTM CFO 6.3x 8.1x 8.4x 9.7x 12.3x


EBITDA Margin 14.8% 15.6% 21.7% 21.5% 22.5%







Healthcare 3Q15 4Q15 1Q16 2Q16 3Q16




EV/TTM CFO 20.5x 18.6x 19.6x 19.2x 18.2x


EBITDA Margin 12.3% 12.7% 12.5% 14.6% 13.5%



TTM EBITDA Growth (YoY) 5.1% -3.1% 2.8% 25.1% 12.7%

TTM Earnings Growth (YoY) 14.6% 17.1% 1.7% -42.5% -55.2%


Enterprise Value Growth (YoY) -7.0% 0.6% -10.4% -1.9% 12.8%

THE SEG SOFTWARE INDEX METRICS BY PRODUCT CATEGORY

68

IT Conglomerates 3Q15 4Q15 1Q16 2Q16 3Q16




EV/TTM CFO 10.4x 11.5x 10.2x 11.1x 11.6x


EBITDA Margin 31.1% 31.0% 27.5% 27.7% 28.2%


TTM Revenue Growth (YoY) -1.1% -3.5% -4.3% -3.1% -2.3%


TTM Earnings Growth (YoY) -13.2% -9.2% -18.3% -10.4% 5.8%


Enterprise Value Growth (YoY) -6.9% -8.0% -15.5% -11.0% 2.1%

Mobile Solutions/Content 3Q15 4Q15 1Q16 2Q16 3Q16




EV/TTM CFO 18.6x 31.5x 17.4x 15.1x 16.3x


EBITDA Margin -3.5% 0.4% -0.2% -1.5% -0.8%






Enterprise Value Growth (YoY) -30.0% -23.6% -30.5% -31.4% -7.3%

Networking & Network Perf Mgmt 3Q15 4Q15 1Q16 2Q16 3Q16




EV/TTM CFO 11.7x 10.2x 10.3x 10.4x 14.4x


EBITDA Margin 19.6% 18.0% 14.2% 9.3% 10.2%






Enterprise Value Growth (YoY) 4.2% -14.7% -26.1% -21.1% -6.7%

Security 3Q15 4Q15 1Q16 2Q16 3Q16




EV/TTM CFO 20.2x 18.3x 15.0x 14.3x 22.0x


EBITDA Margin 1.6% 1.1% 2.6% 5.0% 4.7%

Net Income Margin -12.0% -12.9% -1.4% 0.7% 0.6%





Enterprise Value Growth (YoY) 12.3% 35.1% -5.0% -19.1% -11.6%

Billing & Service Management 3Q15 4Q15 1Q16 2Q16 3Q16




EV/TTM CFO 9.8x 9.5x 9.6x 10.0x 9.8x


EBITDA Margin 27.2% 23.9% 21.2% 22.1% 21.8%


TTM Revenue Growth (YoY) 3.1% -0.4% 0.2% 0.6% 1.8%

TTM EBITDA Growth (YoY) 6.5% 11.2% 5.4% -2.2% -9.8%




Business Intelligence 3Q15 4Q15 1Q16 2Q16 3Q16




EV/TTM CFO 21.3x 25.3x 19.6x 23.3x 20.1x


EBITDA Margin 18.5% 17.2% 14.9% 15.2% 15.3%

Net Income Margin 4.2% -1.8% -1.2% -0.8% 2.1%






Development Platforms 3Q15 4Q15 1Q16 2Q16 3Q16




EV/TTM CFO 11.6x 13.0x 12.8x 15.6x 14.5x


EBITDA Margin 19.0% 18.6% 18.0% 17.5% 17.1%




TTM Earnings Growth (YoY) -2.2% 14.1% 18.5% 8.0% 0.4%


Enterprise Value Growth (YoY) 30.6% 7.9% 8.9% -0.8% -4.0%

Engineering & PLM 3Q15 4Q15 1Q16 2Q16 3Q16




EV/TTM CFO 15.9x 17.2x 17.1x 19.1x 20.6x


EBITDA Margin 22.9% 22.4% 19.3% 17.6% 17.6%



TTM EBITDA Growth (YoY) 7.5% 11.7% 0.1% -2.0% 1.3%

TTM Earnings Growth (YoY) 2.8% 3.1% -0.9% -0.6% 2.6%




Storage, Data Mgmt & Integration 3Q15 4Q15 1Q16 2Q16 3Q16




EV/TTM CFO 10.1x 9.7x 9.1x 12.2x 11.5x


EBITDA Margin 4.7% 2.3% 1.4% 2.2% 2.7%

Net Income Margin 2.0% -0.7% -0.4% 0.0% -0.1%

TTM Revenue Growth (YoY) 1.5% 3.8% 3.1% -0.9% 0.9%





Systems Management 3Q15 4Q15 1Q16 2Q16 3Q16




EV/TTM CFO 14.6x 12.9x 11.2x 12.2x 13.4x


EBITDA Margin 23.8% 22.1% 25.9% 26.1% 26.9%




TTM Earnings Growth (YoY) 3.7% -4.0% 11.6% 10.2% 15.7%


Enterprise Value Growth (YoY) 4.7% 11.7% 3.7% 1.5% -4.0%

Vertical - Finance 3Q15 4Q15 1Q16 2Q16 3Q16




EV/TTM CFO 15.6x 18.0x 17.4x 17.9x 15.4x


EBITDA Margin 34.2% 32.7% 32.9% 32.7% 31.7%




TTM Earnings Growth (YoY) 9.2% -3.3% 1.3% 4.0% 7.1%



Vertical - Other 3Q15 4Q15 1Q16 2Q16 3Q16




EV/TTM CFO 28.1x 24.2x 25.6x 25.3x 27.5x


EBITDA Margin 13.8% 14.9% 16.4% 15.2% 16.6%







THE SEG SOFTWARE INDEX METRICS BY PRODUCT CATEGORY

69


SEG Internet Index



1-800-FLOWERS.COM 0.6x 0.6x 0.5x 0.5x 0.6x 10.4x 9.5x 6.3x 6.6x 8.8x 51.4% 13.3% 8.0% 8.0% 4.6% 6.0% 6.8% 7.3% 7.3% 6.6%

58.com 14.7x 12.8x 10.8x 8.3x 6.8x - - - - - 99.7% 134.6% 169.8% 182.7% 150.1% -18.8% -33.0% -30.6% -23.9% -12.7%

8x8 3.3x 4.5x 4.2x 4.2x 5.0x 68.1x 135.0x 191.5x 287.5x 369.1x 25.6% 25.8% 26.4% 28.9% 28.5% 4.9% 3.4% 2.2% 1.5% 1.3%

Akamai Technologies 6.1x 4.9x 4.2x 4.0x 4.0x 18.5x 15.0x 13.5x 12.9x 12.7x 19.3% 15.6% 11.9% 9.9% 8.0% 33.1% 32.4% 31.5% 31.2% 31.2%

Alibaba 13.6x 14.9x 11.9x 12.2x 14.1x 40.2x 44.7x 35.0x 34.1x 39.1x 40.3% 35.7% 33.3% 32.7% 40.1% 33.7% 33.2% 34.1% 35.8% 36.1%

Amazon.com 2.6x 3.1x 2.5x 2.9x 3.0x 43.0x 44.6x 34.0x 36.5x 35.3x 17.2% 18.0% 20.2% 23.3% 25.9% 6.0% 7.0% 7.4% 8.0% 8.5%

Angie's List 0.9x 1.6x 1.4x 1.4x 1.5x 19.7x 27.4x 22.9x 30.1x 15.2x 17.0% 12.7% 9.2% 5.7% 1.7% 4.3% 5.7% 6.3% 4.8% 9.7%

Baidu.com 5.6x 6.4x 5.3x 5.1x 5.1x 18.7x 24.8x 20.2x 20.1x 20.9x 42.5% 38.6% 35.3% 32.9% 25.1% 30.1% 26.0% 26.4% 25.6% 24.5%

Bankrate 4.6x 5.7x 3.4x 2.4x 2.3x 12.4x 13.3x 11.7x 8.6x 9.8x -48.5% -50.7% 5.8% 23.7% 46.3% 37.1% 43.2% 29.1% 27.4% 23.1%

Baozun 1.0x 0.7x 0.4x 0.4x 0.8x - 50.8x 34.5x 35.6x 41.5x - 68.2% 64.0% 55.6% 45.0% -1.8% 1.4% 1.2% 1.2% 2.0%

Bitauto Holdings 1.9x 1.9x 1.2x 1.6x 2.1x 17.8x 51.3x 14.5x 16.2x 17.3x 89.3% 90.5% 63.1% 62.0% 45.3% 10.6% 3.8% 8.4% 9.7% 12.1%

BlueNile 0.7x 0.8x 0.5x 0.6x 0.7x 20.8x 22.7x 13.0x 15.8x 18.8x 6.2% 5.5% 1.4% 0.1% -1.4% 3.4% 3.5% 3.6% 3.5% 3.6%

Brightcove 1.2x 1.4x 1.2x 1.3x 2.6x - - 111.8x 84.2x 141.6x 6.9% 6.1% 7.8% 8.9% 10.6% -1.9% -0.8% 1.1% 1.5% 1.8%

BroadSoft 3.7x 3.7x 3.2x 3.9x 4.0x 39.9x 49.1x 29.3x 35.3x 33.1x 25.8% 25.7% 28.6% 29.6% 30.3% 9.4% 7.6% 10.9% 10.9% 12.2%

Carbonite 1.9x 1.6x 1.1x 1.3x 1.8x - - - - 191.5x 12.3% 11.7% 11.4% 19.9% 31.5% -1.4% -4.9% -5.7% -3.1% 1.0%

Care.com 1.0x 1.0x 0.9x 1.3x 1.7x - - - - - 24.3% 25.3% 24.2% 21.4% 21.4% -9.0% -7.3% -2.4% -0.1% -0.1%

ChangYou.com 1.1x 1.0x 0.9x 0.5x 0.7x 4.1x 2.8x 2.9x 1.7x 2.3x 9.7% 11.1% 0.8% -12.8% -24.5% 27.5% 36.0% 31.9% 32.0% 32.3%

Chegg 1.9x 1.7x 1.1x 1.2x 2.1x 29.4x 22.3x 124.8x 107.6x - 14.5% 6.8% -1.1% -10.2% -15.3% 6.6% 7.6% 0.9% 1.1% -4.2%

Cimpress 2.0x 2.2x 2.1x 2.2x 2.2x 14.7x 16.7x 16.0x 16.3x 16.9x 17.6% 15.6% 13.9% 16.4% 19.7% 13.6% 13.0% 13.1% 13.7% 12.9%

Coupons.com 2.7x 1.8x 2.3x 3.2x 3.7x - - - - - 17.6% 6.3% 7.0% 9.7% 12.7% -6.8% -10.0% -9.4% -8.5% -6.4%

Criteo SA 2.1x 1.8x 1.5x 1.6x 1.4x 25.4x 21.6x 17.3x 18.2x 14.7x 94.2% 64.2% 33.9% 27.9% 25.3% 8.2% 8.5% 8.6% 9.0% 9.2%

Ctrip 7.2x 13.0x 11.9x 12.2x 10.7x - 643.3x 185.9x - - 41.4% 44.6% 48.3% 57.9% 64.8% -1.9% 2.0% 6.4% -7.2% -8.2%

DemandMedia 0.4x 0.5x 0.5x 0.7x 0.5x - - - - - -22.5% -25.6% -26.9% -25.4% -22.3% -4.4% -11.7% -13.3% -18.7% -21.6%

eBay 3.6x 4.2x 3.4x 3.3x 4.1x 11.3x 13.3x 9.8x 9.6x 11.8x -32.1% -21.9% -2.3% 26.5% 1.7% 31.8% 31.5% 34.3% 34.4% 35.0%

eHealth 1.1x 0.9x 0.6x 0.9x 0.7x 34.7x 31.8x 21.1x 6.7x 7.7x -1.3% -2.4% 5.5% 6.4% 6.5% 3.2% 2.7% 3.0% 13.0% 9.2%

Everyday Health 2.1x 1.4x 1.0x 1.2x 1.4x 29.8x 21.3x 9.6x 12.6x 15.5x 20.5% 22.4% 25.9% 30.9% 23.6% 6.9% 6.5% 10.4% 9.2% 9.0%

Expedia 2.6x 2.8x 2.8x 2.6x 2.4x 22.9x 24.5x 25.3x 22.9x 22.6x 16.3% 13.9% 15.8% 21.3% 26.7% 11.3% 11.5% 11.0% 11.2% 10.8%

Facebook 16.9x 17.6x 16.3x 15.9x 15.1x 39.1x 42.4x 35.5x 33.2x 30.2x 46.2% 42.3% 43.8% 46.3% 51.4% 43.3% 41.5% 46.0% 47.7% 50.0%

GoDaddy 1.8x 2.0x 1.9x 2.0x 2.0x 23.7x 22.6x 22.8x 21.9x 20.7x 19.9% 17.6% 15.9% 15.3% 15.1% 7.7% 8.6% 8.1% 9.3% 9.8%

Google 5.0x 6.3x 5.8x 5.5x 5.7x 15.3x 19.3x 17.8x 16.9x 17.4x 14.4% 12.8% 13.6% 15.0% 17.5% 32.5% 32.5% 32.6% 32.7% 32.9%

Groupon 0.6x 0.4x 0.5x 0.4x 0.8x 15.7x 11.8x 22.5x 44.9x 371.5x 9.9% 5.4% 2.5% 1.2% 1.1% 3.6% 3.3% 2.1% 1.0% 0.2%

GrubHub 7.0x 5.5x 4.4x 4.9x 7.2x 24.3x 20.8x 17.9x 20.9x 32.0x 53.3% 46.0% 42.5% 36.1% 34.2% 28.8% 26.5% 24.7% 23.2% 22.6%

Harmonic 1.0x 1.0x 0.5x 0.7x 1.1x 18.2x 25.9x 23.6x - - -8.2% -10.7% -13.0% -17.4% -14.6% 5.4% 3.8% 2.2% -1.7% -3.8%

Interactive Intelligence 2.2x 1.8x 1.5x 2.0x 3.0x 86.1x 74.0x 159.6x - - 12.1% 10.7% 14.5% 14.0% 12.3% 2.5% 2.4% 0.9% -0.1% -0.5%

InterActiveCorp 2.1x 1.8x 1.4x 1.4x 1.6x 16.4x 14.4x 12.0x 12.2x 13.5x 6.0% 7.0% 3.9% 4.3% 3.0% 12.7% 12.4% 11.9% 11.7% 11.7%

LendingClub - - - - - - - - - - 104.5% 105.4% 103.6% 97.5% 67.9% - - - - -

LifeLock 0.9x 1.8x 1.4x 1.6x 2.2x 13.4x 25.0x 18.4x 22.4x 36.0x 26.3% 25.0% 23.4% 21.8% 18.7% 6.8% 7.3% 7.7% 7.0% 6.0%

THE SEG INTERNET INDEX COMPANIES – KEY METRICS

70



71

SEG Internet Index



Limelight Networks 1.2x 0.7x 0.4x 0.8x 1.0x - - - - 45.3x -0.9% 3.2% 5.3% 4.0% 2.4% -5.0% -5.9% -2.8% -1.0% 2.1%

LINE Corporation - - - - 7.2x - - - - 58.8x 68.6% 68.6% 39.4% 28.5% 24.4% 3.8% 3.8% 4.7% 7.8% 12.3%

LinkedIn 9.1x 10.2x 4.5x 4.7x 6.9x 124.9x 141.5x 54.7x 57.0x 60.0x 38.6% 37.1% 34.8% 34.9% 34.1% 7.3% 7.2% 8.3% 8.3% 11.5%

Liquidity Services 0.3x 0.4x 0.2x 0.3x 0.5x 5.0x 6.9x - - - -13.8% -19.9% -32.3% -32.0% -27.3% 6.5% 5.1% -0.2% -1.7% -1.8%

Mail.ru Group 6.3x 8.0x 8.4x 7.5x 6.5x 14.2x 20.2x 23.7x 21.6x 19.0x 19.9% 18.8% 17.9% 13.3% 9.2% 44.0% 39.5% 35.4% 34.6% 33.9%

MakeMyTrip 1.6x 1.9x 2.2x 1.9x 2.2x - - - - - 9.3% 5.0% 5.1% 12.1% 21.8% -4.4% -6.2% -10.6% -17.8% -22.4%

Marchex 0.5x 0.5x 0.4x 0.3x 0.1x 38.3x 41.5x 28.5x - - -14.6% -23.5% -17.6% -11.4% -5.1% 1.2% 1.2% 1.3% -1.0% -3.8%

Match Group - 3.4x 3.7x 4.2x 4.5x - 13.7x 15.2x 16.9x 17.4x - - 14.9% 17.2% 18.1% 24.2% 25.0% 24.0% 24.6% 25.7%

MaxPoint Interactive 0.9x 0.2x 0.1x 0.3x 0.4x - - - - - 60.4% 49.5% 31.6% 17.6% 10.4% -9.9% -9.6% -11.9% -13.9% -15.0%

Mercadolibre 8.6x 7.9x 6.8x 8.6x 10.3x 27.7x 26.5x 24.8x 33.7x 40.3x 21.2% 19.4% 17.1% 12.2% 15.5% 30.9% 29.8% 27.4% 25.5% 25.6%

Mitel Networks 1.3x 1.4x 1.2x 1.2x 1.2x 10.0x 11.0x 9.9x 10.2x 9.6x 41.5% 22.2% 4.9% 6.8% 10.7% 12.9% 12.5% 12.4% 11.5% 12.2%

MOL Global 0.9x 0.6x 0.5x - - - - - - - 11.2% 23.9% 22.6% 19.6% 20.5% -45.7% -43.0% -33.4% -25.5% -1.3%

Monster Worldwide 1.1x 1.0x 0.5x 0.5x 0.6x 11.3x 7.7x 3.5x 3.2x 5.2x -9.2% -2.9% -8.1% -6.9% -8.7% 9.8% 13.1% 14.1% 14.2% 11.8%

NCSoft 3.8x 4.0x 4.4x 4.6x 5.5x 10.3x 11.7x 13.5x 13.4x 15.5x 10.5% 2.8% -0.1% 5.0% 7.2% 37.0% 34.0% 32.5% 34.0% 35.2%

Netease 5.5x 5.6x 4.6x 4.2x 5.0x 15.0x 16.4x 14.0x 12.4x 14.7x 49.4% 72.1% 94.7% 108.0% 112.3% 36.4% 34.3% 32.7% 33.4% 33.9%

Netflix 7.2x 7.5x 6.2x 5.7x 5.5x 108.7x 130.5x 114.0x 127.1x 132.8x 24.9% 24.0% 23.2% 23.4% 24.7% 6.7% 5.8% 5.4% 4.5% 4.1%

Overstock.com 0.2x 0.2x 0.1x 0.2x 0.2x 16.3x 12.7x 18.2x 35.8x 181.0x 17.3% 15.7% 10.7% 7.7% 5.8% 1.5% 1.2% 0.7% 0.5% 0.1%

Pandora 3.3x 2.3x 1.7x 1.8x 2.4x - - - - - 28.0% 26.0% 26.4% 28.6% 25.8% -3.7% -3.4% -5.8% -9.1% -12.3%

PetMed Express 1.2x 1.2x 1.2x 1.4x 1.6x 8.9x 8.7x 8.8x 10.0x 10.6x -1.4% -0.5% 0.5% 2.3% 3.1% 13.7% 14.2% 14.1% 14.1% 14.6%

Priceline 7.4x 7.4x 7.0x 7.1x 7.4x 20.0x 19.6x 18.5x 18.5x 19.6x 16.1% 11.3% 9.3% 10.3% 11.5% 37.1% 37.9% 38.0% 38.3% 37.9%

Qihoo 4.9x 4.9x 5.3x 5.3x 5.2x 18.0x 19.7x 25.2x 25.0x 24.7x 64.2% 47.7% 29.8% 29.8% 29.8% 27.0% 25.1% 21.1% 21.1% 21.1%

QuinStreet 0.8x 0.6x 0.4x 0.4x 0.4x - - - - - -0.1% 3.8% 3.0% 3.8% 5.5% -1.0% -0.8% -1.4% -1.7% -2.1%

Renren 12.4x 17.4x 22.1x 20.5x 13.7x - - - - - -45.0% -31.6% -11.9% 37.4% -25.1% -136.4% -138.8% -238.1% -208.2% -180.2%

Rocket Fuel 0.6x 0.3x 0.3x 0.3x 0.3x - - - - - 47.9% 34.1% 13.0% 5.4% -1.5% -11.3% -11.3% -7.3% -4.5% -3.6%

Rovi 2.8x 2.9x 2.9x 2.9x 2.6x 19.2x 22.8x 22.7x 20.0x 18.1x 8.3% 4.9% 3.3% 2.0% 4.4% 14.4% 12.7% 12.9% 14.4% 14.5%

SeaChange International 1.3x 1.5x 1.2x 0.6x 0.6x - - - - - -12.0% -7.3% -7.3% -7.8% -14.5% -10.7% -9.2% -7.2% -6.8% -13.9%

ShoreTel 1.0x 1.4x 1.1x 0.9x 1.2x 14.2x 18.0x 12.5x 14.0x 21.7x 6.3% 4.2% 2.4% 1.9% 0.2% 7.4% 7.9% 8.6% 6.6% 5.5%

Shutterfly 1.7x 1.8x 1.6x 1.7x 1.8x 18.5x 19.5x 14.5x 15.0x 15.1x 16.8% 17.2% 15.0% 14.5% 13.6% 9.2% 9.3% 10.8% 11.2% 11.7%

Shutterstock 2.5x 2.3x 2.1x 2.6x 3.8x 18.2x 17.7x 16.1x 19.4x 28.9x 34.3% 31.4% 29.6% 26.0% 23.2% 13.6% 12.8% 13.0% 13.5% 13.2%

SINA 1.7x 2.8x 2.5x 2.6x 4.3x 123.3x 58.5x 45.4x 37.3x 44.4x 9.2% 10.8% 14.6% 14.5% 14.5% 1.4% 4.7% 5.6% 7.1% 9.6%

Sohu.com 0.7x 0.6x 0.6x 0.4x 0.4x 5.6x 3.3x 3.2x 2.3x 2.7x 22.2% 23.2% 15.8% 7.2% -2.2% 13.0% 18.6% 18.6% 18.2% 15.7%

Sonus Networks 0.9x 0.9x 1.0x 1.3x 1.3x - - - - 42.4x -15.6% -15.6% -16.0% -6.4% 3.7% -7.2% -7.2% -6.0% -0.2% 3.0%

Stamps.com 6.9x 8.2x 7.4x 6.5x 5.4x 28.6x 32.6x 24.7x 20.2x 15.6x 31.2% 34.9% 45.3% 59.3% 67.0% 24.3% 25.3% 30.0% 32.1% 34.7%

Synacor 0.2x 0.3x 0.4x 0.7x 0.7x 4.5x 5.1x 9.6x 17.6x 21.9x 3.0% 3.5% 3.4% 5.3% 10.1% 3.8% 6.3% 4.0% 4.1% 3.1%

Tencent Holdings 11.8x 12.1x 10.7x 11.1x 12.4x 28.2x 29.3x 25.6x 26.4x 28.8x 22.6% 24.7% 30.3% 35.6% 44.0% 41.9% 41.5% 41.7% 42.1% 43.1%

The Rubicon Project 3.3x 3.0x 2.4x 2.0x 0.9x - - 31.3x 19.5x 6.3x 65.1% 75.9% 98.3% 101.2% 81.5% -2.8% -0.3% 7.7% 10.1% 14.0%

TheStreet.com 0.4x 0.4x 0.2x 0.2x 0.2x 13.2x 28.2x 7.3x 15.3x 48.7x 14.6% 16.0% 10.8% 5.2% 0.1% 3.4% 1.5% 2.7% 1.1% 0.4%


SEG Internet Index



Travelzoo 0.5x 0.6x 0.6x 0.6x 1.0x 12.0x 11.7x 8.8x 8.7x 12.2x -6.9% -8.0% -7.5% -9.7% -8.1% 4.3% 5.3% 6.8% 7.0% 8.2%

Tree.Com 5.8x 5.0x 3.2x 2.7x 3.0x 61.3x 46.9x 27.9x 23.3x 23.5x 22.6% 37.4% 51.9% 67.2% 76.3% 9.4% 10.6% 11.4% 11.8% 12.6%

Tremor 0.3x 0.2x 0.2x 0.2x 0.3x - - - - - 7.5% 11.5% 9.0% 4.7% 2.3% -9.6% -8.8% -6.3% -6.9% -7.9%

TripAdvisor 7.1x 7.9x 6.1x 6.0x 5.7x 28.2x 31.7x 32.5x 38.1x 40.6x 31.5% 25.6% 19.7% 11.5% 4.0% 25.2% 24.8% 18.8% 15.7% 14.0%

TubeMogul 2.3x 2.2x 1.9x 1.9x 1.4x - - - - - 62.4% 58.0% 58.2% 57.1% 45.4% -6.5% -7.1% -5.1% -6.2% -6.6%

Tucows 1.7x 1.5x 1.3x 1.4x 1.6x 16.4x 13.8x 10.7x 11.5x 11.8x 16.0% 17.4% 17.1% 15.8% 13.4% 10.4% 11.1% 12.0% 12.5% 13.6%

Twitter 9.5x 7.9x 4.5x 3.6x 4.4x - - - - - 82.6% 70.3% 58.1% 49.6% 39.2% -16.1% -10.5% -7.9% -2.8% -0.2%

VeriSign 7.6x 8.8x 8.5x 8.5x 7.6x 12.2x 14.1x 13.5x 13.4x 11.8x 4.4% 4.3% 4.9% 6.2% 7.3% 61.8% 62.6% 63.0% 63.6% 64.6%

WebMD Health 2.9x 3.0x 3.3x 3.7x 3.0x 14.3x 14.0x 14.4x 15.8x 12.2x 8.4% 7.6% 9.6% 10.4% 12.2% 20.4% 21.2% 23.0% 23.6% 24.3%

Wix.com 4.4x 4.3x 3.4x 4.2x 6.2x - - - - - 57.8% 50.3% 43.5% 40.0% 39.8% -30.0% -25.2% -21.4% -20.7% -18.9%

XO Group 2.1x 2.3x 2.0x 2.3x 2.5x 14.4x 16.1x 14.3x 15.7x 17.0x 3.2% 1.0% -1.4% 0.6% 3.9% 14.4% 14.2% 14.2% 14.8% 14.9%

Xunlei 1.0x 0.3x - - - 6.1x 1.7x - - - -5.8% -3.4% -3.2% 4.3% -11.8% 16.8% 18.1% 4.1% -5.8% -11.4%

Yahoo! 6.0x 5.4x 4.9x 6.3x 7.2x 53.8x 56.3x 73.7x 123.9x 232.6x 5.4% 6.8% 7.6% 2.5% 0.5% 11.1% 9.6% 6.7% 5.1% 3.1%

Yandex 4.1x 5.5x 4.9x 6.1x 6.1x 12.5x 17.9x 17.5x 21.0x 20.1x 19.0% 17.0% 17.8% 22.4% 26.1% 32.5% 30.7% 28.2% 29.3% 30.1%

Yelp 3.3x 3.2x 2.2x 2.6x 3.9x 54.0x 100.6x 14853.8x - - 56.5% 49.5% 45.6% 40.6% 35.4% 6.1% 3.2% 0.0% -1.5% -1.4%

YuMe 0.4x 0.3x 0.4x 0.4x 0.3x - - - - - 7.6% 1.0% -2.5% -4.6% -4.4% -4.7% -6.5% -6.8% -5.5% -3.0%

YY 3.9x 3.8x 3.6x 2.5x 2.3x 14.3x 16.6x 14.9x 10.8x 10.1x 79.5% 65.6% 60.3% 53.7% 50.0% 27.3% 23.1% 24.1% 22.9% 23.2%

Zillow 9.0x 7.4x 5.6x 6.7x 8.2x - - - - 848.5x 86.9% 94.5% 97.8% 81.8% 54.4% -4.1% -4.5% -0.7% -1.5% 1.0%

Zynga 1.8x 1.7x 1.2x 1.8x 2.1x - - - - - 7.5% 14.4% 10.8% 8.9% -0.3% -13.6% -8.6% -6.4% -4.7% -2.7%


72


Infrastructure 3Q15 4Q15 1Q16 2Q16 3Q16




EV/TTM CFO 19.4x 20.1x 16.6x 14.3x 15.2x


EBITDA Margin 6.4% 6.9% 6.1% 5.4% 4.3%




TTM Earnings Growth (YoY) 9.0% -5.1% -3.8% -6.0% 14.0%


Enterprise Value Growth (YoY) 10.5% 25.6% 3.8% -0.6% 10.8%

Search 3Q15 4Q15 1Q16 2Q16 3Q16




EV/TTM CFO 13.4x 17.4x 15.9x 16.0x 15.8x


EBITDA Margin 31.3% 28.3% 27.3% 27.5% 27.3%



TTM EBITDA Growth (YoY) 2.1% -10.9% -7.0% -2.2% -1.7%

TTM Earnings Growth (YoY) 12.3% 4.1% -13.7% -14.2% 21.0%


Enterprise Value Growth (YoY) -8.9% -6.6% -16.7% -8.5% 20.6%

Services 3Q15 4Q15 1Q16 2Q16 3Q16




EV/TTM CFO 21.8x 16.6x 20.4x 24.0x 25.0x


EBITDA Margin 5.6% 6.1% 7.0% 8.5% 9.5%







Social 3Q15 4Q15 1Q16 2Q16 3Q16




EV/TTM CFO 33.4x 29.9x 20.8x 19.7x 22.8x


EBITDA Margin 15.8% 15.2% 16.1% 15.6% 17.3%



TTM EBITDA Growth (YoY) 10.1% -0.8% 5.9% 12.3% 22.2%



Enterprise Value Growth (YoY) -25.1% 13.0% 3.8% -19.8% -6.1%

Travel 3Q15 4Q15 1Q16 2Q16 3Q16EV/TTM Revenue 4.8x 5.1x 4.5x 4.3x 4.1xEV/NTM Revenue 3.7x 5.3x 5.0x 4.2x 4.7xEV/TTM EBITDA 21.4x 24.5x 25.3x 20.7x 21.1xEV/TTM CFO 23.0x 31.4x 21.2x 20.2x 18.9xGross Profit Margin 83.4% 83.4% 83.5% 83.7% 84.3%EBITDA Margin 7.8% 8.4% 8.9% 9.1% 9.5%Net Income Margin 7.8% 14.5% 12.4% 8.7% 6.1%TTM Revenue Growth (YoY) 16.2% 12.6% 12.5% 11.8% 16.6%TTM EBITDA Growth (YoY) -14.1% -2.8% 2.7% -11.3% -14.3%TTM Earnings Growth (YoY) 5.6% 10.0% 5.4% 33.1% 12.3%Cash as Percent of Market Cap 10.1% 14.2% 14.2% 13.0% 12.5%Enterprise Value Growth (YoY) -7.4% 13.2% 1.1% -2.3% 37.3%

THE SEG INTERNET INDEX METRICS BY PRODUCT CATEGORY

73

Ad Tech 3Q15 4Q15 1Q16 2Q16 3Q16




EV/TTM CFO 13.4x 17.2x 14.8x 16.0x 11.0x


EBITDA Margin 1.2% 1.2% 6.7% 5.1% 3.1%



TTM EBITDA Growth (YoY) 1.8% -15.1% -0.9% -0.1% 15.5%



Enterprise Value Growth (YoY) -24.0% -24.9% -28.7% -16.7% -20.0%

Commerce 3Q15 4Q15 1Q16 2Q16 3Q16




EV/TTM CFO 17.3x 19.0x 19.9x 15.7x 20.8x


EBITDA Margin 6.2% 6.0% 5.4% 5.4% 5.1%



TTM EBITDA Growth (YoY) -0.4% 0.6% -1.8% 5.4% 11.0%

TTM Earnings Growth (YoY) -4.8% 5.0% 18.0% 12.9% 30.2%



Content & Media 3Q15 4Q15 1Q16 2Q16 3Q16




EV/TTM CFO 13.0x 18.3x 13.6x 13.4x 15.5x


EBITDA Margin 11.1% 9.6% 5.6% 5.1% 4.1%

Net Income Margin 3.2% 2.6% 1.8% 1.8% -4.7%



TTM Earnings Growth (YoY) 64.7% -29.8% -32.8% -18.4% 16.6%



Gaming 3Q15 4Q15 1Q16 2Q16 3Q16




EV/TTM CFO 13.2x 14.6x 13.1x 14.7x 26.4x


EBITDA Margin 31.9% 34.2% 32.2% 32.7% 33.1%








Select Public Sellers

74

Date Buyers Seller

Purchase Price

(mm)

Enterprise

Value (mm) EV/ Rev EV/ EBITDA

TTM

Revenue

Growth

07/28/16 Oracle Corporation (NYSE:ORCL) NetSuite Inc. (NYSE:N) $9,106.6 $8,698.9 10.3x - 31.5%

07/30/16 Verizon Communications Inc. (NYSE:VZ) Fleetmatics Group PLC (NYSE:FLTX) $2,377.7 $2,183.5 7.0x 32.9x 20.2%

08/30/16 Genesys Telecommunications Laboratories, Inc. Interactive Intelligence Group Inc. (NasdaqGS:ININ) $1,560.1 $1,394.3 3.4x - 12.3%

07/06/16 AVAST Software s.r.o. AVG Technologies N.V. (NYSE:AVG) $1,559.7 $1,463.0 3.4x 11.7x 6.8%

09/16/16 Vista Equity Partners Infoblox Inc. (NYSE:BLOX) $1,512.4 $1,254.3 3.5x - 17.0%

07/26/16 DTI Epiq Systems, Inc. (NasdaqGS:EPIQ) $1,026.3 $1,009.0 1.9x 11.6x 17.5%

09/07/16 Alphabet Inc. (NasdaqGS:GOOGL) Apigee Corporation (NasdaqGS:APIC) $584.6 $516.3 5.6x - 34.1%

08/08/16 Randstad North America, LP Monster Worldwide, Inc. (NYSE:MWW) $486.1 $382.8 0.6x 5.1x (8.7%)

08/21/16 Loblaw Companies Limited (TSX:L) QHR Corporation (TSXV:QHR) $130.1 $119.8 5.1x 57.7x 17.2%


Select Mega Deals

75

Date Buyers Seller

Purchase

Price (mm)

Enterprise

Value (mm) EV/ Rev

EV/

EBITDA

TTM

Revenue

Growth

07/28/16 Oracle Corporation (NYSE:ORCL) NetSuite Inc. (NYSE:N) $9,106.6 $8,698.9 10.3x - 31.5%

09/07/16 Micro Focus International plc (LSE:MCRO) Hewlett Packard Enterprise Company, Software Business $8,730.4 $8,730.4 2.8x 13.3x -3.1%

07/11/16 Onex Corporation (TSX:OCX); Baring Private Equity Asia Thomson Reuters Corporation, Intellectual Property & Science Business $3,550.0 $3,550.0 - - 1.7%

08/09/16 EQT Partners AB Press Ganey Holdings, Inc. (NYSE:PGND) $2,428.6 $2,382.2 6.9x 22.7x 14.7%

07/30/16 Verizon Communications Inc. (NYSE:VZ) Fleetmatics Group PLC (NYSE:FLTX) $2,377.7 $2,183.5 7.0x 32.9x 20.2%

07/26/16 LogMeIn, Inc. (NasdaqGS:LOGM) Citrix Systems, Inc., GoTo Family Of Products $1,802.6 $1,802.6 - - 6.9%

09/12/16 Open Text Corporation (NasdaqGS:OTEX) Dell EMC, Enterprise Content Division $1,620.0 $1,620.0 2.7x - 1.0%

08/30/16 Genesys Telecommunications Laboratories, Inc. Interactive Intelligence Group Inc. (NasdaqGS:ININ) $1,560.1 $1,394.3 3.4x - 12.3%

07/06/16 AVAST Software s.r.o. AVG Technologies N.V. (NYSE:AVG) $1,559.7 $1,463.0 3.4x 11.7x 6.8%

07/26/16 DTI Epiq Systems, Inc. (NasdaqGS:EPIQ) $1,026.3 $1,009.0 1.9x 11.6x 17.5%

07/21/16 Hellman & Friedman LLC Genesys Telecommunications Laboratories, Inc. $900.0 $3,800.0 - - -

09/07/16 Alphabet Inc. (NasdaqGS:GOOGL) Apigee Corporation (NasdaqGS:APIC) $584.6 $516.3 5.6x - 34.1%

07/30/16 salesforce.com, inc. (NYSE:CRM) Quip, Inc. $582.0 $582.0 - - -


Most Active Buyers

76

Buyers Seller

Enterprise

Value (mm) EV/ Rev

EV/

EBITDA

Alphabet Inc. (NasdaqGS:GOOGL) Apigee Corporation (NasdaqGS:APIC) $584.6 5.61x 5.6x

Anvato Inc. - - -

FortyTwo Inc. - - -

Dazzle Interactive Network Technologies Co., Ltd. $173.6 0.5x 1.7x

E-surfing Media Co., Ltd. $291.0 1.5x 1.5x

Icartoon Culture & Media Corporation Limited $17.0 2.2x 0.5x

Tianyi Reading Culture Dissemination Co., Ltd. $104.7 1.7x 2.2x

Aireum Inc. - - -

Conspire Inc. - - -

Profoundis Labs Pvt. Ltd. - - -

Cluster Labs, Inc. - - -

Moodstocks SAS - - -

Orbitera Inc. - - -

salesforce.com, inc. (NYSE:CRM) BeyondCore, Inc. - - -

Coolan, Inc. - - -

HeyWire, Inc. - - -

Quip, Inc. $582.0 - -

Beyond the Scores, LLC - - -

RallyMe, Inc. - - -

Sioux Falls Swim Team, Inc. - - -

Trackwrestling.com, LLC - - -

Thoma Bravo, LLC Imprivata, Inc. $512.1 3.7x 3.7x

T2 Systems, Inc. - -

TRADER Corporation $1,220.0 -

Fleetmatics Group PLC (NYSE:FLTX) $2,377.7 7.0x 7.0x

Sensity Systems, Inc. - -

Yahoo! Inc., Operating Business $4,825.8 -

Infoblox Inc. (NYSE:BLOX) $1,512.4 3.5x 3.5x

Granicus Inc. - -

GovDelivery, Inc. $153.0 -

FullContact Inc.

Google Inc.

Verizon Communications Inc.

Vista Equity Partners

Besttone Holding Co.,Ltd.

(SHSE:600640)

SportsEngine

Date post:	11-Jan-2017
Category:	Software
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