M&A1Q23 SaaS M&A Update

SaaS M&A deals now comprise 66% of all software M&A transactions.

Download the SEG Snapshot: 1Q23 SaaS M&A Update

The SaaS M&A market remained robust despite macroeconomic pressure, destabilizing events such as regional bank collapses, and broader public market volatility, growing 21% QOQ to 567 transactions in 1Q23. For the first time, SaaS M&A deal volume comprised a record 66% of aggregate software deal activity (including SaaS, on-premise license model, internet, and mobile transactions), proving the staying power of SaaS companies as acquisition targets.

Our latest report highlights the following insights into the SaaS M&A market:

  • The median EV/Revenue multiple of 5.2x was in line with recent quarters and indicates stability.
  • A focus on SaaS specialization increased in Q1, with vertically focused transactions comprising nearly half of all deals, a deviation from the typical 60/40 split with horizontally-focused companies.
  • Private equity-driven deals (including platform direct and PE-backed) account for 61.1% of all SaaS M&A transactions.

Download our full 1Q23 report to explore the latest trends and learn more.