Transactions
Let's Talk
ANNUAL RESEARCH

SEG 2025 Annual SaaS Report

SaaS Poised for Continued Growth in 2025

The software industry remains a dynamic force, with SaaS companies demonstrating remarkable adaptability despite macroeconomic challenges. The SEG Annual SaaS Report delivers unparalleled insights into the SaaS landscape, combining analysis of over 118 publicly traded SaaS companies with a detailed review of more than 2,100 SaaS M&A transactions in 2024—the second-most active year on record. The SEG SaaS Index™ ended 2024 up 3% despite macroeconomic headwinds. With inflation stabilizing at 3.2% and anticipated interest rate cuts in 2025, SaaS businesses are well-positioned to capitalize on improving conditions.

Download the full report to uncover the key trends, benchmarks, and insights that will help you navigate the ever-evolving SaaS market.

25-Annual-SaaS

The Top 3 Highlights

2,107
Total SaaS M&A Deals in 2024

The SaaS industry recorded the second-highest number of deals on record, with SaaS transactions making up 61% of all software M&A activity, reflecting sustained strength in the market​.

26.6%
Upper Quartile Stock Price Increase in 2024

The upper quartile of companies in the SEG SaaS Index™ achieved an impressive average stock price increase of 26.6%, highlighting the strong performance of top-tier SaaS businesses in the public market​.

11.7x
Median EV/TTM Revenue Multiple for High Retention Companies

Companies with net retention rates above 120% achieved a premium valuation of 11.7x EV/TTM revenue, a 109% premium over the Index median of 5.6x, highlighting the critical role of retention in valuation performance​.

DOWNLOAD REPORT

Comprehensive Insights from the SEG SaaS Index™

The public market section offers an in-depth analysis of stock prices, financial performance, and valuation metrics for the 118 publicly traded B2B SaaS companies in our SEG SaaS Index™. Updated quarterly, the Index reflects the dynamic SaaS landscape, with adjustments driven by mergers and acquisitions, IPO activity, and changes in business models. Most recently, we removed Brightcove and Zuora due to their acquisitions by Bending Spoons and Silver Lake, respectively.

In 2024, the upper quartile of the Index achieved an impressive 26.6% average stock price increase, performing on par with the NASDAQ. This group included high performers like Vertex (98% YOY increase), The Trade Desk (68%), Oracle (58%), and ServiceNow (50%). These companies exemplify the market’s preference for businesses that balance robust growth and profitability. The upper quartile traded at a median EV/TTM revenue multiple of 8.8x, a 57% premium over the Index median of 5.6x.

Notable Public SaaS Companies

DOWNLOAD REPORT

SEG SaaS Index EV/Revenue by Product Category

Several categories in the Index reported higher median EV/TTM revenue multiples in 4Q24 compared to 4Q23, reflecting continued investor confidence and strong performance in key sectors. ERP & Supply Chain saw a significant increase, rising from 7.7x in 4Q23 to 9.0x in 4Q24, fueled by the mission-critical role of platforms such as Oracle, SAP, and Descartes. Similarly, the Security category experienced a 17% YOY increase, with leaders like Crowdstrike benefiting from heightened demand for cybersecurity solutions, pushing multiples from 7.6x to 8.9x. Financial Applications also showed improvement, climbing from 6.7x to 7.3x, as tools that optimize financial operations continued to gain traction.

EV/Revenue by Product Category
Quarterly Medians
4Q23
1Q24
2Q24
3Q24
4Q24
SEG SaaS Index
6.1x
6.5x
5.8x
5.6x
6.0x
Analytics & Data Management
6.0x
5.9x
5.2x
3.3x
3.7x
ERP & Supply Chain
7.7x
8.6x
8.0x
7.9x
9.0x
Financial Applications
6.7x
6.3x
6.0x
6.8x
7.3x
Security
7.6x
10.3x
8.7x
8.1x
8.9x
Vertically Focused
4.9x
5.3x
4.9x
4.7x
4.8x
4Q23
SEG SaaS Index
6.1x
Analytics & Data Management
6.0x
ERP & Supply Chain
7.7x
Financial Applications
6.7x
Security
7.6x
Vertically Focused
4.9x
1Q24
SEG SaaS Index
6.5x
Analytics & Data Management
5.9x
ERP & Supply Chain
8.6x
Financial Applications
6.3x
Security
10.3x
Vertically Focused
5.3x
2Q24
SEG SaaS Index
5.8x
Analytics & Data Management
5.2x
ERP & Supply Chain
8.0x
Financial Applications
6.0x
Security
8.7x
Vertically Focused
4.9x
3Q24
SEG SaaS Index
5.6x
Analytics & Data Management
3.3x
ERP & Supply Chain
7.9x
Financial Applications
6.8x
Security
8.1x
Vertically Focused
4.7x
4Q24
SEG SaaS Index
6.0x
Analytics & Data Management
3.7x
ERP & Supply Chain
9.0x
Financial Applications
7.3x
Security
8.9x
Vertically Focused
4.8x
DOWNLOAD REPORT

Recapping SaaS M&A Activity

In 2024, SaaS M&A activity demonstrated continued strength with 2,107 transactions, marking the second-highest year on record, narrowly trailing the 2022 peak of 2,157 transactions. While the volume dipped slightly by 2% compared to 2022, 2024 saw an 18% increase over 2021 and a substantial 61% growth compared to 2020. SaaS deals accounted for 61% of all software M&A activity, reflecting the industry’s ongoing transition toward cloud-based solutions. The year ended on a high note with 534 transactions in Q4, representing a 15% YOY increase and the most active fourth quarter on record.

SaaS M&A Deal Volume

Annual
DOWNLOAD REPORT

SaaS M&A Activity Across Product Categories in 2024

Analytics & Data Management accounted for 100 deals in 4Q24, tied with Content & Workflow Management as the most active product category and marking a notable increase over prior quarters. This surge was driven by the growing influence of AI-related transactions, reflecting the sector’s adaptation to technological advancements.

Business Management/ERP, another key category, maintained steady performance with 76 transactions in 4Q24—a 17% QOQ increase—and 239 deals for the year, reaffirming its mission-critical role in business operations.

Analytics & Data Management
Content & Workflow Management
Business Management / ERP
Sales & Marketing
Financial Applications
Security

Analytics & Data Management

Quarterly SaaS M&A

Content & Workflow Management

Quarterly SaaS M&A

Business Management / ERP

Quarterly SaaS M&A

Sales & Marketing

Quarterly SaaS M&A

Financial Applications

Quarterly SaaS M&A

Security

Quarterly SaaS M&A
DOWNLOAD REPORT

Strategic Buyers and Private Equity Shape SaaS M&A

Private equity investors continued to dominate SaaS M&A in 2024, driving 61% of all transactions through platform acquisitions and portfolio add-ons by PE-backed strategics. Strategic buyers accounted for 39% of total deals, reflecting steady involvement amidst private equity’s growing influence. Publicly traded strategic buyers, which represented 22% of transactions, saw slightly reduced activity compared to historical levels. However, with declining inflation and interest rates, their participation is poised to increase, signaling potential momentum in the coming year.

SaaS M&A Activity by Buyer Type

2024
DOWNLOAD REPORT

Insights to Drive Stronger Software M&A Performance

Market-Maps (1)
browser_updated guide

Interactive Market Maps

SaaS-Index
browser_updated guide

SEG SaaS Index Page

2025-BuyerPerspectives-thumb (1)
auto_graph report

State of SaaS M&A: Buyers' Perspectives

Archived Reports

If you are looking for a past version of SEG’s Annual or Quarterly Reports, you can now download all previously published reports from our archived section.

Annual
2024 ANNUAL REPORT
2023 ANNUAL REPORT
2022 ANNUAL REPORT
2021 ANNUAL REPORT
Quarterly
3Q24 QUARTERLY REPORT
2Q24 QUARTERLY REPORT
1Q24 QUARTERLY REPORT
3Q23 QUARTERLY REPORT
DOWNLOAD YOUR REPORT

2025 SaaS M&A and Public Market Report

25-Annual-Download

Gain strategic insights into the SaaS industry with our latest report. Click the button to download your copy.