3Q24

SaaS M&A and Public Market Report

SaaS M&A on Pace to See 3rd Highest Year on Record

SaaS is projected to account for over 65% of all software deals in 2024, a sharp rise from 45% just five years ago. SaaS M&A is on track for 2,000–2,100 transactions this year, making it the third-highest year on record. With 594 deals in 3Q24, we saw 20.5% QOQ growth from Q2 and a 13.8% YOY increase. Q3 was the busiest quarter since 1Q22, marking it the second most active quarter on record. This momentum is expected to continue, setting up a strong 2025 for SaaS M&A.

The Top 3 Highlights

594

Q3 SaaS M&A Deals

The SaaS M&A market recorded 594 deals in Q3 2024, reflecting a 20.5% increase from Q2’s 493 deals.

5.7x

Average SaaS EV/TTM Revenue Multiple

The average EV/TTM Revenue multiple for M&A held steady in 3Q24, with in-quarter median and average multiples at 4.9x and 5.7x, respectively.

9.3x

Median EV/TTM Revenue Multiple

The upper quartile by EV/TTM Revenue multiple reached a median multiple of 9.3x, a staggering 75% premium to the total SEG SaaS Index™ median.

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Public SaaS Companies

The public market section provides a comprehensive analysis of stock prices, financial data, and valuation performance for over 120 publicly traded B2B software companies constituting our SEG SaaS Index™.

The top quartile of the index by stock price saw an average increase of 39% YTD. Regarding multiples, the median EV/TTM Revenue multiple of the Index was 5.3x in 3Q24, while the upper quartile reached a median of 9.3x – a significant 75% premium over the total Index median.

Notable Public SaaS Companies

SEG SaaS Index TTM Revenue Growth Rate

The Vertically Focused category stands out with a notable shift, highlighting the critical role of purpose-built solutions in meeting specific industry challenges. While its overall median growth rate falls below the Index median of 14.2%, this lower figure is skewed by the bottom third of companies, which saw a median YOY growth of just 5.5%. However, the top third of this category significantly outperformed, achieving a strong median YOY growth rate of 26%, showcasing the impressive potential of specialized solutions in this space.

EV/Revenue by Product Category

Quarterly Medians

3Q23

4Q23

1Q24

2Q24

3Q24

SEG SaaS Index

6.2x

6.0x

6.3x

5.7x

5.3x

Analytics & Data Management

8.6x

11.0x

9.0x

10.4x

9.0x

DevOps & IT Management

11.0x

9.0x

10.4x

9.0x

7.1x

ERP & Supply Chain

8.3x

7.7x

8.6x

8.0x

7.9x

Sales & Marketing

5.5x

5.0x

5.2x

4.6x

3.8x

Vertically Focused

6.3x

4.9x

5.3x

4.9x

4.7x

3Q23

SEG SaaS Index

6.2x

Analytics & Data Management

8.6x

DevOps & IT Management

11.0x

ERP & Supply Chain

8.3x

Sales & Marketing

5.5x

Vertically Focused

6.3x

4Q23

SEG SaaS Index

6.0x

Analytics & Data Management

11.0x

DevOps & IT Management

9.0x

ERP & Supply Chain

7.7x

Sales & Marketing

5.0x

Vertically Focused

4.9x

1Q24

SEG SaaS Index

6.3x

Analytics & Data Management

9.0x

DevOps & IT Management

10.4x

ERP & Supply Chain

8.6x

Sales & Marketing

5.2x

Vertically Focused

5.3x

2Q24

SEG SaaS Index

5.7x

Analytics & Data Management

10.4x

DevOps & IT Management

9.0x

ERP & Supply Chain

8.0x

Sales & Marketing

4.6x

Vertically Focused

4.9x

3Q24

SEG SaaS Index

5.3x

Analytics & Data Management

9.0x

DevOps & IT Management

7.1x

ERP & Supply Chain

7.9x

Sales & Marketing

3.8x

Vertically Focused

4.7x

SaaS M&A Activity

The 594 SaaS M&A deals in 3Q24 represented a 20.5% QOQ increase from 493 in 2Q24 and a 13.8% YOY rise from 526 in 3Q23, making it the busiest quarter since 1Q22 and the second most active on record. M&A multiples generally held steady in 3Q24, with in-quarter median and average multiples at 4.9x and 5.7x, respectively. These multiples, reported on a TTM basis, slightly understate the quarter’s strength.

SaaS M&A Deal Volume

Quarterly

M&A Deal Volume

Monthly

Vertical M&A Activity

Vertically focused businesses comprised 43% of all SaaS deals in 3Q24, down from 49% in 3Q23. Healthcare led as the most active vertical at 14% of these deals, with strong activity also seen in Real Estate (10%), Government (8%), and Energy (8%).

Healthcare M&A

Quarterly

Buyers of SaaS

Private Equity investors continue to lead SaaS M&A, whether through platform acquisitions or PE-backed strategic deals. PE platform deals made up 12.3% of 3Q24 deals, rising from 9.7% QOQ and 10.4% YOY. PE-backed strategic deals were the most active buyer type, accounting for 52.9% of deals in 3Q24—the highest level since SEG began tracking this metric—up from 48.5% QOQ and 49.9% YOY. Publicly traded strategics maintained steady activity, making up around 20% of SaaS transactions, consistent over the past two years.

SaaS M&A Activity by Buyer Type

3Q24

Insights to Drive Stronger Software M&A Performance

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Interactive Market Maps

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SEG SaaS Index Page

Expert-PE-Perspectives-on-the-Evolving-Software-M&A-Market

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State of SaaS M&A: Buyers' Perspectives

Archived Reports

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