SEG Snapshot: 3Q21 SaaS M&A Update

SEG’s 3Q21 SaaS M&A update is a snapshot of M&A deal activity across the software industry. The report includes historical deal volume by product category and vertical, valuation stats, most active buyers, notable deals, private equity activity, and more.

Report Highlights:
  • Aggregate software industry M&A volume continues to reach new heights, as the third quarter of 2021 posted a record 933 transactions. For context, until late 2019, aggregate software industry deal volume had yet to eclipse 700 transactions.
  • Equally impressive and unsurprisingly, SaaS M&A deal volume also set a new record. 3Q21’s 498 SaaS M&A deals surpassed the previous record of 425 deals (4Q20) by approximately 17%.
  • Record demand for SaaS businesses has also driven up M&A multiples considerably in recent quarters, culminating in an astounding 8.0x EV/Revenue multiple in 3Q21.
  • Private equity firms continued to drive a majority of SaaS M&A activity and accounted for 55% of deals in 3Q21.
  • The quarter included several mega transactions, including Afterpay’s acquisition by Square ($28.6B, 42.7x EV/Revenue), Medallia’s acquisition by Thoma Bravo ($6.1B, 12.3x EV/Revenue), Cornerstone OnDemand’s acquisition by Clearlake Capital Group ($5.2B, 6.3x EV/Revenue), and Frame.io’s acquisition by Adobe ($1.3B).

Click to Download Report