Since Vertical SaaS Food IT: Soil to Fork Conference. Palo Alto, CA.

Transcription

1 Since 1987 Vertical SaaS 2014 Food IT: Soil to Fork Conference Palo Alto, CA June 20, 2014

2 About JEGI The Jordan, Edmiston Group, Inc. ( JEGI ) The Leading Independent Investment Bank Serving the Media, Information, Marketing and Technology Sectors Experience Founded in 1987, JEGI has completed more than 500 transactions, spanning media, information, marketing and technology companies. Industry Leadership JEGI has deep relationships among global, middle-market and emerging media, information, marketing and technology companies, enabling it to anticipate trends and provide valued advice. Primary Focus JEGI focuses primarily on executing sell-side assignments, conducting efficient, highly effective processes to meet the needs of the client and achieve maximum value. Independence JEGI is committed to the success of each client assignment, with no sales and trading, lending or private equity investing to conflict with the firm s advisory clients' priorities. Results JEGI s team-driven process achieves the highest transaction success rates and enthusiastic endorsements from the firm s satisfied clients. 2

3 JEGI Leading the Market JEGI The Consistent Market Leader in Transactions Completed Among the Sectors It Serves #1 8 th Consecutive Year *Source: 451 Group 3

4 Recent JEGI Transactions 32 transactions from 2012 to 2014 for over $2.1 billion in enterprise value In each transaction listed above, JEGI s client is mentioned first. 4

5 Industry Specific = Largest Segment of the Software Market 10% Vertical Specific Software Operating Systems 3% Other Application Software 4% 4% 3% 28% $100B Database Management Systems ERP App Infrastructure / Middleware Security 5% CRM IT Operations 5% 8% Office Suites Storage Management 5% 5% 7% Business Intelligence Other Infrastructure Software 6% 7% Other 5

6 Enterprise Software Market Cloud Industry Cloud Mainframe Client Server Applications 6

7 The Move to Industry Clouds SaaS is No Longer a Differentiator Customizing Horizontal Apps Not an Option Rise of Meaningful Big Data Applications Industry Cloud: Domain Expertise and Best Practices Industry Clouds Capitalize on Aggregated Data 7

8 Industry Focus Provides More Efficient Sales & Marketing Spend 65.4% 51% Median S&M Spend 53.3% 52.2% 50.7% 50.5% 46.0% 42.1% 41.7% 20% Median S&M Spend 25.4% 25.1% 24.0% 20.6% 19.7% 19.4% 17.7% 16.0% MKTO CRM PFPT N DWRE NOW WDAY CNQR RP ATHN MDSO ADVS VEEV BLKB GWRE TRAK Horizontal SaaS Industry-Specific Software Source: CapitalIQ 8

9 Shift to SaaS Platform Leads to a Premium Valuation Multiple Enterprise Value Multiple EV / Revenue High- Growth SaaS Rev x EV / EBITDA B2B Media Lead Generation Business Information & Data EBITDA x Completeness of Offering 9

10 Vertical SaaS Comps Vertical Focused SaaS ($ millions) Financial Data Valuation Multiples Enterprise LTM YoY Rev LTM NTM Company Vertical Market Cap Value Revenue EBITDA Margin Growth TEV/Rev TEV/EBITDA TEV/Rev TEV/EBITDA AthenaHealth Healthcare 4,972 5, % 40% 8.0x NM 6.4x 36.2x Veeva Systems Healthcare 3,182 2, % 58% 12.1x NM 9.6x 43.4x Guidewire Insurance 2,664 2, (2) -1% 21% 6.8x NM 6.0x 36.1x DealerTrack Holdings Automotive 2,353 2, % 31% 5.6x NM 3.3x 15.0x Medidata Healthcare 2,310 2, % 26% 8.0x NM 6.5x 27.1x RealPage Real Estate 1,722 1, % 15% 4.3x NM 3.6x 15.5x Advent Software Financial Services 1,634 1, % 6% 4.9x 26.2x 4.7x 13.7x Blackbaud Non Profit 1,610 1, % 10% 3.4x 17.2x 3.2x 14.6x Source: CapitalIQ as of June 19 th, 2014 Mean NM 26% 6.6x 21.7x 5.4x 25.2x Median NM 23% 6.2x 21.7x 5.3x 21.3x Vertical SaaS EV/Revenue Three-Year Trend 8.50x 7.50x 6.50x 5.50x 4.50x 3.50x Source: CapitalIQ as of June 19 th, 2014 Vertical SaaS - EV/Revenue 10

11 Vertical SaaS Comps Focused SaaS ($ millions) Buyer Target Vertical Description Date Price Revenue EBITDA Revenue Multiple EBITDA Multiple Dealertrack Dealer Dot Com Auto Marketing & operations software for the auto industry Mar-14 $994 $184 $32 5.4x 31.1x Dealertrack ClickMotive* Auto Interactive marketing software for the auto industry Oct-12 $57 $15 na 3.9x na Dealertrack 1st Auto Transport Directory* Auto SaaS for arranging vehicle transport and shipping Aug-12 $74 $10 $5 7.4x 14.7x Dealertrack ecarlist Auto Inventory mgmt & marketing tools for auto industry Jul-11 $45 $7 na 6.5x na Edmentum, Inc. Archipelago Learning, Inc. Education SaaS education products Mar-12 $366 $89 na 4.1x na Silver Lake; Warburg Pincus Interactive Data Corporation (Pearson) Energy Provides financial market data and analytics. Jul-10 $2,946 $775 $ x 11.0x Thomson Reuters Point Carbon Energy Decision-support services and market analysis for carbon market Jun-10 $180 $34 na 5.3x na ABB Ltd. Ventyx Inc. Energy Software, data and advisory services to the oil and gas sector May-10 $1,000 $250 na 4.0x na SilverLake BlackLine Systems Finance SaaS accounting software Sep-13 $220 $25 na 8.8x na Moneysupermarket.com MoneySavingExpert.com Finance Website with budgeting tips, tools and techniques Sep-12 $135 $24 na 5.6x na Davis + Henderson Mortgagebot Finance SaaS mortgage POS solution for banks & credit unions Apr-11 $232 $38.0 $20 6.1x 11.5x HGGC MyWebGrocer Grocery Ecommerce + shopper marketing software for grocery May-13 $190 $36.0 C O N F I D $14 E N T I A L5.3x 13.8x Blackbaud Convio Non-Profit On-demand engagement solutions for fund-raising May-12 $274 $81 $8 3.4x 35.5x Corporate Resource Services Summit Software Professional Services Software and cloud-based hosting solutions for staffing companies May-13 $20 $3 $1 7.9x 16.6x Guidance Software CaseCentral Professional Services SaaS document management applications Feb-12 $80 $20 $2 4.1x 38.3x Tellular Corporation SkyBitz Professional Services SaaS asset tracking applications Dec-11 $136 $37 na 4.3x na Mediagrif Interactive Tech. LesPAC Professional Services Provides online classified advertising solutions Nov-11 $71 $12 na 5.8x na 8x8 Contactual Professional Services Cloud-based call center and customer interaction mgmt Sep-11 $28 $9 na 3.0x na Trulia Market Leader Real Estate Online tech. and marketing for the real estate industry May-13 $314 $48 na 6.6x na RealPage Multifamily Technology Solutions Real Estate Operates an apartment and home rentals website Aug-11 $75 $17 na 4.5x na Cineplex EK3 Technologies Retail SaaS in-store digital merchandising services Aug-13 $112 $25 $4 4.5x 29.3x Demand Media Society6 Retail ECommerce portal for art and art-related products Jun-13 $94 $15 na 6.3x na Cielo Merchant e-solutions Retail SaaS ecommerce platform payment solutions Aug-12 $670 $124 $61 5.4x 11.0x BazaarVoice PowerReviews Retail SaaS social commerce solutions May-12 $128 $12.0 na 10.7x na General Atlantic Bazaarvoice Retail SaaS social commerce solutions Feb-12 $25 $160 na 2.0x na Norwest Venture Partners The Retail Equation Retail SaaS platform for retail transaction optimization Oct-11 $68 $14 C O N F I D $5 E N T I A L4.9x 12.8x Oracle Art Technology Group Retail ecommerce software on-demand optimization apps Jan-11 $987 $219 $31 4.5x 32.1x Note: JEGI deals marked Confidential Mean 5.3x 21.5x Source: JEGI Transaction Database and Capital IQ Median 5.3x 15.7x *Revenue and EBITDA estimated off 1H results Source: CapitalIQ 11

12 MyWebGrocer Case Study: Defining Grocery SaaS 12

13 MyWebGrocer Case Study: Process Overview Dominant provider of shopping and shopper marketing software and services to U.S. grocery and CPG companies Serves 60% of U.S. grocery retailers, high renewal SaaS revenue, plus closedloop marketing for CPG brands Company sought a new partner to cash out VC investor and founding family and accelerate expansion into new markets JEGI worked closely with management to position a complex business in a rigorous process to drive maximum value Mission accomplished Competitive process with range buyers Fully diligenced final bids and efficient, timely completion Exceeded valuation expectations via high-quality financial buyer Attractive go-forward opportunities for management 13

14 Big Industries, Big SaaS Platforms Who will win? $2,015 $2,073 $1,119 $620 $776 $781 Grocery Agriculture Auto Construction Healthcare Finance Source: BEA, FMI 2013 Industry Size ($ in billions) 14

15 Annual North America Production Agriculture Revenue A winner can emerge from a number of areas Equipment $70B Inputs $103B 15

16 Representative AgData Industry Transactions Buyer Target Acquisition Date Acquisition Price Transaction Overview 6/4/2014 Undisclosed 10/2/2013 $930 million 8/29/2012 $335 million Reed Business Information is a provider of data services, business information, and marketing to businesses Farmade provides crop management and agronomy software to more than 2,500 agriculture clients This acquisition allows Farmade to have a broader reach with its crop recording, mapping and precision software The Monsanto Company provides tech-based solutions and agricultural products that improve farm productivity The Climate Corporation helps farmers protect and improve their operations with software and insurance products Monsanto believes Climate Corporation s capabilities represents a potential opportunity of $20 billion Trimble Navigation applies technology to make field and mobile workers more productive TMW Systems is a leading provider of enterprise software for advanced positioning solutions TMW will add further capabilities to Trimble s robust agriculture guidance and data management business 16

17 Presenting Companies: Growth IT Companies in Agriculture 17

18 Since 1987 Vertical SaaS 2014 Food IT: Soil to Fork Conference Palo Alto, CA June 20, 2014