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The global software sector remains one of the most active sectors, with ~$17B in financing volume and ~$22B in M&A volume during Q3 ’19.

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Sector Report: Software Q3 2019

EXECUTIVE SUMMARY

  • The global software sector remains one of the most active sectors, with ~$17Bn in financing volume and ~$22Bn in M&A volume during Q3 ’19
    • 222 financings in Q3 ‘19 is 19% higher than the number of financings in the same period in ’18
    • 384 M&A transactions in Q3 ‘19 is 6% higher than the 363 deals consummated during the same period in ’18
  • Significant M&A activity in Q3 driven by acquisitions in the cybersecurity sector; Broadcom’s $10.7Bn acquisition of Symantec’s Enterprise Security Assets and VMware’s $2.1Bn acquisition of Carbon Black
  • Financial Software had one of the highest financing volume counts in Q3 ‘19 led by the $470MM financing of N26 and $400MMfinancing of Nubank; the Operations Management sector also saw a high volume of financings
  • Software sector trading performance remained healthy, with overall IGV tech-software index outperforming the S&P 500 by 1.9% over the past twelve months
    • The Vertical software index has grown 19.5% over the last 12 months, outperforming all other software sub segments
  • Technical Application companies traded at the highest average multiples of 8.8x and 27.3x for 2019 Revenue and EBITDA, respectively
  • Overall momentum and growth rates remain healthy in the software space with Business Intelligence and Analytics leading the 2019E/2018A revenue growth at 30.2%

Select Q3 Active Investors

  • Accel
  • Andreessen Horowitz
  • Battery
  • Bessemer Venture Partners
  • General Catalyst
  • Greylock Partners
  • Insight Partners
  • Kleiner Perkins
  • NEA
  • Norwest Venture Partners
  • Redpoint
  • Sequoia

Select Q3 Active Buyers

  • Adobe
  • Broadcom
  • Cisco
  • Google
  • IBM
  • j2 Global
  • Microsoft
  • Oracle
  • Salesforce
  • Symantec
  • Thomson Reuters
  • VMware

GCA Sector Coverage

  • AI / Machine Learning
  • BI / Analytics
  • Collaboration Software
  • CRM
  • Cybersecurity
  • Enterprise Content Management
  • Enterprise Resource Planning
  • Infrastructure Management
  • Marketing Technology
  • SaaS / Cloud Enablement
  • Supply Chain Management
  • Vertically Focused Software
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