3Q25

SaaS M&A and Public Market Report

2025 Shaping Up to Be a Record Year for SaaS

SaaS deal activity surged to record levels in 3Q25, with 746 transactions, up 26% year over year and marking the strongest quarter SEG has ever tracked. Year-to-date volume has surpassed 2,000 deals, putting 2025 on pace to exceed 2,500 total transactions, a new all-time high. The sustained momentum reflects renewed buyer confidence, stable financing conditions, and a steady supply of quality SaaS assets returning to market.

Public markets reinforced this strength, with U.S. equities hitting record highs and the SEG SaaS Index™ up nearly 10% from April lows. The Fed’s late September rate cut, accelerating AI adoption, and strong earnings all fueled optimism, while DevOps & IT Management, Security, and Analytics & Data Management led performance across the Index, reflecting investor conviction in categories driving enterprise AI enablement and digital infrastructure.

Our 3Q25 SaaS M&A and Public Market Report breaks down the data, trends, and valuation dynamics shaping this record-setting quarter.

The Top 3 Highlights

746

3Q25 SaaS M&A Deals

SaaS M&A reached a record high with 746 transactions, up 26% year over year and on pace for more than 2,500 deals in 2025.

5.4x

Average SaaS M&A EV/TTM Revenue Multiple

Average multiples held steady at 5.4x as buyers remained active and competitive for high-quality SaaS assets.

+10%

SEG SaaS Index™ Performance Since April Lows

The Index rallied nearly 10% in 3Q25, reflecting renewed investor confidence and strong performance from leading SaaS categories.

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Public SaaS Companies

Our SEG SaaS Index™ tracks the performance, valuations, and financials of 112 publicly traded B2B software companies. After bottoming in April, the Index rallied nearly 10% in 3Q25, led by top-quartile performers that gained almost 12% over the same period. The rebound underscores renewed investor confidence in SaaS fundamentals amid stabilizing macro conditions.

The spread between leaders and laggards remains wide, reflecting a market that continues to reward profitable, capital-efficient operators. Top-quartile companies trade at 8.4x EV/TTM revenue, more than three times the multiples of lower-quartile peers, while sustained revenue growth and margin expansion continue to drive valuation premiums for the most durable SaaS businesses.

Notable Public SaaS Companies

SEG SaaS Index™ EV/TTM Revenue Multiple

Valuations remained resilient in 3Q25, with the SEG SaaS Index™ averaging 5.3x EV/TTM revenue, reflecting steady investor confidence in profitable, mission-critical software businesses. Capital continues to flow toward platforms that pair efficient growth with strong margin performance and play an essential role in enterprise AI adoption.

DevOps & IT Management (7.7x), ERP & Supply Chain (7.7x), and Security (7.2x) led all categories, supported by durable performance from leaders such as Cloudflare, CrowdStrike, and Oracle. These sectors anchor digital infrastructure, driving automation, visibility, and data protection that enable scalable efficiency and AI-driven productivity.

Within Vertically Focused SaaS, premium platforms like Guidewire, Veeva, and Tyler Technologies continued to command elevated valuations, underscoring investor conviction in durable, high-performing operators.

EV/Revenue by Product Category

Quarterly Medians

3Q24

4Q24

1Q25

2Q25

3Q25

SEG SaaS Index

5.9x

6.3x

6.5x

5.4x

5.3x

Analytics & Data Management

3.3x

3.7x

4.2x

3.9x

3.8x

DevOps & IT Management

8.1x

9.4x

9.3x

8.1x

7.7x

ERP & Supply Chain

8.0x

9.1x

8.5x

8.4x

7.7x

Sales & Marketing

3.9x

4.9x

4.5x

3.6x

3.8x

Vertically Focused

4.5x

4.0x

3.7x

3.2x

3Q24

SEG SaaS Index

5.9x

Analytics & Data Management

3.3x

DevOps & IT Management

8.1x

ERP & Supply Chain

8.0x

Sales & Marketing

3.9x

Vertically Focused

4.5x

4Q24

SEG SaaS Index

6.3x

Analytics & Data Management

3.7x

DevOps & IT Management

9.4x

ERP & Supply Chain

9.1x

Sales & Marketing

4.9x

Vertically Focused

4.5x

1Q25

SEG SaaS Index

6.5x

Analytics & Data Management

4.2x

DevOps & IT Management

9.3x

ERP & Supply Chain

8.5x

Sales & Marketing

4.5x

Vertically Focused

4.0x

2Q25

SEG SaaS Index

5.4x

Analytics & Data Management

3.9x

DevOps & IT Management

8.1x

ERP & Supply Chain

8.4x

Sales & Marketing

3.6x

Vertically Focused

3.7x

3Q25

SEG SaaS Index

5.3x

Analytics & Data Management

3.8x

DevOps & IT Management

7.7x

ERP & Supply Chain

7.7x

Sales & Marketing

3.8x

Vertically Focused

3.2x

SaaS M&A Activity

SaaS M&A activity reached record levels in 3Q25, with 746 transactions, up 26% year over year and extending a three-quarter streak of elevated deal volume. The sustained pace reflects strong demand from both strategic and sponsor-backed buyers, supported by stable financing conditions and renewed confidence in the broader macro environment.

Valuations remained steady, with a median multiple of 4.1x and an average of 5.4x, consistent with the range seen over the past year. The gap between median and average multiples continues to highlight a market that differentiates sharply between average performers and standout platforms. Buyers continue to reward SaaS companies that demonstrate efficient growth, strong profitability, and defensible market positions.

SaaS M&A Deal Volume

Quarterly

M&A Deal Volume

Monthly

Vertical M&A Activity

Vertical SaaS represented 54% of all SaaS M&A activity in 3Q25, up from 43% a year earlier, as buyers increasingly targeted sector-specific platforms with embedded workflows, recurring spend, and exposure to critical end markets. Healthcare (18%) and Financial Services (14%) led transaction volume, while Retail (9%) and Real Estate (9%) posted some of the strongest year-over-year gains.

Vertical platforms continue to draw heightened interest for their domain depth, operational stickiness, and essential role in driving modernization and efficiency across core industries.

Healthcare M&A

Quarterly

Buyers of SaaS

Sponsor involvement remained a core driver of SaaS M&A in 3Q25, with private equity and venture-backed buyers accounting for 58% of all transactions, consistent with long-term averages above 55% since 2020. The data underscores the sustained dominance of private capital in software M&A, as firms continue to leverage portfolio platforms for tuck-ins and roll-ups while maintaining steady deal velocity across market cycles.

SaaS M&A Activity by Buyer Type

3Q25

Insights to Drive Stronger Software M&A Performance

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Interactive Market Maps

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SEG SaaS Index Page

report

State of SaaS M&A: Buyers' Perspectives

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