Software Industry Financial Report 1Q16

Q2 2015
Software Equity Group, L.L.C.

12220 El Camino Real
Suite 320
San Diego, CA 92130
info@softwareequity.com
(858) 509-2800
The Software Industry

Financial Report
SOFTWARE INDUSTRY FINANCIAL REPORT CONTENTS

About Software Equity Group
Leaders in Software M&A
Extensive Global Reach
Leading Market Position
Software Industry Macroeconomics
U.S and Global GDP
U.S. GDP and Unemployment
Global IT Spending
E-Commerce and Digital Advertising Spend
Stock Market Performance
Public Software Financial and Valuation Performance
The SEG Software Index
The SEG Software Index: Financial Performance
The SEG Software Index: Public Market Multiples
The SEG Software Index by Product Category
The SEG Software Index by Product Category: Financial Performance
The SEG Software Index by Product Category: Public Market Multiples
Public SaaS Company Financial and Valuation Performance
The SEG SaaS Index
The SEG SaaS Index: Financial Performance
The SEG SaaS Index: Public Market Multiples
The SEG SaaS Index by Product Category: Financial Performance
The SEG SaaS Index by Product Category: Public Market Multiples
Public Internet Company Financial and Valuation Performance
The SEG Internet Index
The SEG Internet Index: Financial Performance
The SEG Internet Index: Public Market Multiples
The SEG Internet Index by Product Category
The SEG Internet Index by Product Category: Financial Performance
The SEG Internet Index by Product Category: Public Market Multiples
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SOFTWARE EQUITY GROUP | Q2 2015 SOFTWARE INDUSTRY FINANCIAL REPORT

Copyright Software Equity Group, LLC, All Rights Reserved
SOFTWARE INDUSTRY FINANCIAL REPORT CONTENTS

Software Industry M&A Market Update
Software/SaaS M&A Deal Volume and Spending
Software M&A Exit Multiples
Software M&A by Ownership Structure and Size
Software M&A by Vertical and Horizontal Markets
Software M&A Deal Volume by Product Category
Software M&A Exit Multiples by Product Category
SaaS M&A Deal Volume and Exit Multiples
SaaS M&A by Product Category
SaaS M&A 2Q15 Transactions
Internet M&A: Deal Volume and Exit Multiples
Internet M&A: By Product Category
Appendix
SEG Software Index Key Metrics
SEG Software Index Key Metrics by Product Category
SEG SaaS Index Key Metrics
SEG SaaS Index Key Metrics by Product Category
SEG Internet Index Key Metrics
SEG Internet Index Key Metrics by Product Category
2Q15 Select Public Sellers
2Q15 Mega Deals
2Q15 Most Active Buyers
About Software Equity Group
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46
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48
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50
51
52-55
56
57
59-62
63-64
65-66
67
68-70
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75

ABOUT SOFTWARE EQUITY GROUP

LEADERS IN SOFTWARE M&A

We Do Deals.
Industry leading boutique investment bank, founded in 1992,

representing public and private software and internet
companies seeking:
Strategic exit
Growth capital
Buyout
Inorganic growth via acquisition
Buy and sell-side mentoring
Fairness opinions and valuations
Sell-side client revenue range: $5 - 75 million
Buy-side clients include private equity firms and NASDAQ,

NYSE and foreign exchange listed companies
Clients span virtually every software technology, product

category, delivery model and vertical market
Global presence providing advice and guidance to more than

2,000 private and public companies throughout US, Canada,
Europe, Asia-Pacific, Africa and Israel
Strong cross-functional team leveraging transaction,

operating, legal and engineering experience
Unparalleled software industry reputation and track record.
Highly referenceable base of past clients

EXTENSIVE GLOBAL REACH

Current Sell-side Representation
SEG currently represents software companies in the

United States, Canada, France, Germany, Australia &
Saudi Arabia
Recent Sell-side Representation
In addition to the countries listed above, SEG has

recently represented software companies in the
United Kingdom, France, Netherlands, Israel, and
South Africa
SEG Research Distribution
SEGs Quarterly and Annual Software Industry

Equity Reports and Monthly Flash Reports are
distributed to an opt-in list of 70,000 public
software company CEOs, software entrepreneurs,
private equity managing directors, VCs, high tech
corporate lawyers, public accountants, etc. in 76
countries.
SOFTWARE INDUSTRY MACROECONOMICS

U.S. AND GLOBAL GDP

Global GDP (% YoY Change)
U.S. GDP (% YoY Change)
Global gross domestic product (GDP) growth (YOY) from

2004 to 2015
Annual growth of the Real Gross Domestic Product (GDP)

of the United Stats from 2006 to 2015
4%
7%
6%
5.6%
5.7%
3%
5.4%
2.7%
1.8%
2%
5%
4.1%
4%
2.3%
2.2%
2.4%
2012
2013
2014 2015*
1.6%
1%
3.4%
3.0%
3.0%
2.5%
3.3%
3.3%
3.3%
3%
0%
-0.3%
-1%
2%
-2%
1%
-3%
0.1%
0%
-2.8%
-4%
2006
2007
2008
2009
2010
2011
2012
2013
2014 2015*
2006
2007
2008
2009
2010
2011
In January, the IMF forecasted a gradually improving global economy that would remain vulnerable to a host of economic and geopolitical risks. It
predicted global GDP would grow 3.5% in 2015.
The IMFs July Update trimmed its April estimate to an annualized GDP growth rate of 3.3% in 2015, essentially the same lackluster rate that has prevailed
for the past three years. In doing so, the IMF reaffirmed the main risks highlighted in April remain relevant. Risks noted in April included continued pay
down of public, corporate and household debt, which could slow spending; weakened oil prices that has adversely impacted producer nations, but
increased disposable income in oil importing countries (ie. U.S., China, Euro area and India); and significant currency exchange rate fluctuations which
could impact manufacturing imports and exports, especially in the U.S, the Euro Zone, and Japan.
The IMF acknowledged its forecasts could also be imperiled by recent geopolitical events and renewed threats of defaults and recessions among EEC
member countries.
Sources: Worldbank, The Economist, Council of Economic Advisors, BEA and Statista
U.S. GDP AND UNEMPLOYMENT

GDP % Growth
Unemployment Rate
12.0%
10.0%
8.0%
6.0%
3.9%
4.0%
1.3%
2.0%
4.6%
3.9%
1.7%
2.9%
2.7% 2.5%
-0.5%
0.0%
2.3%
0.8%
4.6%
4.5%
1.6%
2.7%
2.5%
5.0%
3.5%
2.3%
2.2%
1.8%
0.6%
0.1%
1Q09 2Q09 3Q09 4Q09 1Q10 2Q10 3Q10 4Q10 1Q11 2Q11 3Q11 4Q11 1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14 4Q14 1Q15 2Q15
-2.0%
-1.5%
-4.0%
-6.0%
-2.1%
-5.4%
-8.0%
Early forecasts were for U.S. GDP to grow an average of 3.0% in 2015. Although most economists had revised their projection downward to 1% by the
close of Q1, the Bureau of Economic Analysis announced in July that GDP grew 2.3% in the second quarter.
The Wall Street Journals survey of more than 60 leading economists now projects 3.1% growth in Q3, and 3.0% growth in the final quarter of 2015.
The Labor Department reported the unemployment rate at the end of 2Q15 was 5.3%, a noteworthy decline from 2Q14s 6.2%, and the lowest
unemployment rate since 2008. The Wall Street Journals survey of economists projects the unemployment rate will continue to decline, reaching 5.1% by
year end, and dropping to 4.8% by year end 2016.
The labor participation rate closed 2Q15 at 62.6% and has been flat for the past 12 months, a 35 year low that can be attributed to an aging baby boomer
population that is beginning to retire. This leads to a natural demographic decline in the participation rate.

GLOBAL IT SPEND
Global IT Spending (% YoY Change)
Global IT Spending by Category
8.0%
6.0%
2008
6.0%
2009
2010
2011
2.0%
2.0%
2.1%
2.5%
2012
2013
2014
2015 (F)
-10.0%
Assuming reasonably stable currency exchange rates, Gartner projected at the outset of 2015 that worldwide IT spending would grow at a constant
currency rate of 3.7% in 2015. That was before the significant rise in value of the U.S. dollar against most other currencies, a phenomenon that has had a
materially adverse effect on worldwide IT spending.
By late Q1, Gartner projected global IT spending would shrink 1.3% in 2015, and in Q2 revised that estimate to -5.5%, blaming the rising U.S. dollar. In
constant currency terms, however, Gartner estimates global IT spending in 2015 will decline only 0.6% to 2.5% growth.
Forrester estimates software will account for 27% of all tech spending, leading all other categories. According to Forrester, Softwares leading position is
not a surprise, because it is the focal point for tech innovation today, whether that innovation takes the form of cloud computing and adoption of SaaS,
PaaS, smart computing and big data, real-time predictive analytics and smart process apps, or mobile computing and mobile apps and enterprise app
stores.
Sources: Gartner , Forrester
10
E-COMMERCE AND DIGITAL ADVERTISING SPEND
$90.0
Mobile E-Commerce Spend ($B)
Worldwide Digital Advertising Spend

25.0%
$16
20.0%
$70.0
15.0%
$60.0
10.0%
$50.0
$40.0
$30.0
5.0%
0.0%
YOY Change
E-Commerce Spend ($B)
Aggregate YoY Percent Change
Digital Advertising Revenue ($B)
Desktop E-Commerce Spend ($B)

$80.0
Digital Advertising Spend ($B)
$14
$12
$10
YoY Percent Change
25%
20%
15%
10%
$8
$6
$4
5%
YoY Change
U.S. E-Commerce Spend
0%
$2
-5%
$0
-10%
E-commerce retail sales in the U.S. totaled $72.2 billion in 1Q15 (the latest data available), up 14% YoY. The increase marks the 22nd consecutive quarter
of YoY growth, and the 18th consecutive quarter of double digit growth.
Mobile commerce accounted for $11.1 billion, or 15.4% of the 1Q15 E-Commerce total, according to comScore. In 1Q15, mobile commerce grew 52.1%
YoY, while desktop commerce expanded only 8.9%.
Since total consumer discretionary spending grew by only 4.4% in 1Q15, the 15%+ growth in E-commerce spending affirms a significant and growing shift
from retail to online consumer spending.
According to Forrester, U.S. digital ad revenues will total $37.6 billion in 2019, with the most growth coming from video advertising. Forrester predicts
video advertising on desktop devices alone will grow 14% annually until 2019, when it will contribute 55% of total desktop display ad revenue across the
Web.
Sources: comScore, IAB, IBD, and Forrester

11
STOCK MARKET PERFORMANCE

DOW
S&P
NASDAQ
SEG SW Index
SEG SaaS
SEG Internet Index
20.0%
15.0%
10.0%
5.0%
0.0%
(5.0%)
(10.0%)
Jan 2015
Feb 2015
Mar 2015
Apr 2015
May 2015
Jun 2015
The DOW, S&P and NASDAQ, as well as our SEG Software, Internet, and SaaS indices, all declined early in the first quarter, rebounded by the end of Q1, and
oscillated throughout Q2.
The S&P and DOW closed the second quarter -0.1% and -1.1%, respectively.
The SEG Software Index closed 2Q15 up 9.6% year-to-date, the best return among the six tracking indices and well above the return of the tech heavy
NASDAQ which ended Q2 up 5.3%. The median stock performance of the SEG Software Index has improved steadily since October 2014. For some
investors, these large, slow growing but quite profitable on-premise software providers are a hedge against smaller, high growth cloud, SaaS and Internet
providers, and are seen as ripe for resurgence when GDP growth and IT spending gain momentum.
Concomitantly, the SEG SaaS Index gained only 4.7% by the close of 2Q15, in large part due to investor concerns that their heavy investments in sales and
marketing, which have contributed to significant, ongoing operating losses, were not translating into accelerated growth. Their concerns were somewhat
validated when public SaaS companies posted a 29.9% median revenue growth in 2Q15, the lowest in the past three quarters.
The SEG Internet Index lagged our other two tracking indices, posting a median 3.9% YTD return in 2Q15.
12
THE SEG SOFTWARE INDUSTRY FINANCIAL REPORT

PUBLIC SOFTWARE COMPANY FINANCIAL PERFORMANCE AND MARKET MULTIPLE TRENDS

THE SEG SOFTWARE INDEX

Measure
EV/Revenue
EV/EBITDA
EV/Earnings
Gross Profit Margin
EBITDA Margin
Net Income Margin
TTM Revenue Growth
TTM Total Revenue ($M)
TTM EBITDA Growth
TTM Total EBITDA ($M)
Cash & Eq ($M)
Current Ratio
Debt / Equity Ratio
SEG - Software: Median Metrics

2Q14
3Q14
4Q14
3.2x
2.9x
2.9x
14.8x
13.9x
14.6x
26.8x
25.6x
25.5x
65.7%
65.0%
65.6%
17.4%
17.6%
18.1%
8.4%
8.8%
8.3%
8.2%
8.0%
8.2%
$532.8
$573.2
$584.9
5.4%
6.0%
4.7%
$95.3
$103.6
$103.7
$221.0
$196.8
$213.1
2.0
2.1
2.0
7.8%
5.9%
10.5%
1Q15
3.0x
15.3x
27.5x
65.6%
18.3%
8.3%
8.4%
$584.9
5.1%
$102.3
$213.1
1.9
11.0%
2Q15
3.1x
16.5x
29.4x
65.6%
18.3%
7.9%
8.1%
$593.6
5.8%
$100.3
$211.6
1.8
8.6%
The SEG Software Index tracks public software companies that

primarily offer on-premise software under a perpetual license with
annual M&S.
The SEG Software Index is currently comprised of 135 public

software companies*.
The number of public companies comprising the SEG Software Index

has declined steadily over the past ten years, as many on premise
providers have been acquired, taken private or migrated to a SaaS
business model.
* A number of on-premise software companies are transitioning to subscription based delivery and pricing models; however their SaaS revenue contribution is insufficient for
them to be deemed primarily SaaS.
** See appendix for a complete list of companies in The SEG Software Index and detailed financial and trading metrics
14
THE SEG SOFTWARE INDEX: FINANCIAL PERFORMANCE

Median Revenue Performance Quarterly
33%
$700
8.6%
$600
8.4%
8.2%
$500
8.0%
$400
7.8%
$300
7.6%
$200
7.4%
$100
7.2%
$0
7.0%
2Q14
3Q14
4Q14
1Q15
% of Companies
TTM Revenue Growth
TTM Revenue Growth
TTM Total Revenue
TTM Revenue Growth Rate Distribution 2Q15
25%
23%
2%
<= 0%
> 0%
<= 10%
2Q15
After seven consecutive quarters of slowing growth, the median TTM

revenue growth rates of public on-premise software companies rose
modestly in 8.4% in 1Q15, but declined to 8.1% in Q2.
One in four of the public on-premise software companies comprising

the SEG Software Index reported negative revenue growth in Q2;
more than half grew revenue by a meager 10% or less.
Predictably, the few public on-premise software companies growing

revenue 30%+ were focused on three of ITs hottest product
categories: security (Cyberark Software, 67.4%), and business
intelligence (Splunk, 48.1%) and mobility (Pandora Media, 30.4%).
The consolidation of on-premise software companies over the past 15

years has resulted in an ecosystem of behemoths whose growth has
stalled due to much more focused, prioritized and constrained
enterprise IT spending; a current preference for point (vs. suite)
solutions; and a shift toward cloud-based computing and
subscription pricing, which has negatively impacted revenue
recognition.
10%
7%

> 10%
<= 20%
> 20%
<= 30%
> 30%
<= 40%
> 40%
TTM Revenue Growth
15

Median EBITDA Margin Performance Quarterly
17.6%
18.1%
18.3%
18.3%
23%
EBITDA Margin
% of Companies
17.4%
TTM EBITDA Margin Distribution 2Q15

25%
18%
15%
14%
5%
<= 0%
> 0%
<= 10%
> 10%
<= 20%
> 20%
<= 30%
> 30%
<= 40%
> 40%
TTM EBITDA Margin

2Q14
3Q14
4Q14
1Q15
2Q15
Slowed growth has prompted most on-premise companies to maintain a

keen eye on expenses. The median EBITDA margin of public on-premise
software companies has remained steady at 18.3%, essentially unchanged
over the past three quarters.
Fewer than half of public on-premise software companies achieved

EBITDA margins of 20% or better in the second quarter.
Check Point Software, a security software provider, was a standout

exception, leading the pack once again in 2Q15 with an EBITDA margin of
54.3%. Check Points extraordinary profitability can be attributed in part
to a strong, well-performing channel that reduces its cost of sales.
Curiously, Check Point also spends substantially less on R&D (8.9% of
revenue) compared to their category peers (19.7% of total revenue).
We anticipate the median EBITDA margin of public software companies

will hold steady in 3Q15, in large part due by keeping R&D spending
relatively flat while modestly increasing S&M spending.

16

Median Operating Ratios
S&M (% of Revenue)
R&D (% of Revenue)
Median Margin Performance
G&A (% of Revenue)
Gross Profit Margin

70%
25%
EBITDA Margin
65.6%
65.0%
65.7%
Net Income Margin

65.6%
65.6%
60%
20%
15%
% Margin
% of Revenue
50%
10%
40%
30%
20%
5%
10%
0%
2Q14
3Q14
4Q14
1Q15
2Q15
17.6%
17.4%
8.8%
8.4%
18.1%
8.3%
18.3%
8.3%
18.3%
7.9%
0%
2Q14
3Q14
4Q14
1Q15
2Q15
OpEx: Median spending on operations by public on-premise software companies in 2Q15 was consistent with historic norms: 15.1% for Research &
Development, 21.6% for Sales & Marketing, and 10.8% for General & Administrative.
Over the past year, median S&M, R&D and G&A expenses as a percent of revenue have remained relatively flat.
Median S&M spending as a percent of total revenue by public on-premise public software companies lagged far behind their SaaS counterparts, which
continued to place significant bets on new customer acquisition (21.6% for on-premise vs. 40.2% for SaaS).
Despite declining revenue growth over the past several quarters, the median EBITDA margin of public on-premise software providers has modestly
improved over the past four quarters, reaching 18.3% in 2Q15.

17
THE SEG SOFTWARE INDEX: PUBLIC MARKET VALUE

Median EV/Revenue and EV/EBITDA Multiples Quarterly
Median Multiple
14.8x
3.2x
13.9x
2.9x
EV/EBITDA
14.6x
2.9x
15.3x
3.0x
16.5x
Revenue Greater Than $1 billion
Revenue Between $500 million & $1 billion
Revenue Between $100 million & $500 million
Revenue Less Than $100 million
4.0x
3.5x
3.1x
Median EV/Revenue
EV/Revenue
EV/Revenue Multiples by Size (TTM Revenue) Quarterly
3.0x
2.5x
2.0x
1.5x
1.0x
0.5x
0.0x
2Q14
3Q14
4Q14
1Q15
2Q14
2Q15
The median EV/Revenue market multiple for public on-premise

software providers was 3.1x in 2Q15.
The ~3.0x median EV/Revenue multiple thats prevailed over the past
five quarters, despite lackluster growth, reflects the importance of
stability and profitability to investors in the current market.
The higher EV/Rev multiple premium enjoyed by the largest onpremise software providers grew in the second quarter, surpassing
that of their smaller counterparts.
We believe investor enthusiasm for the largest on-premise providers

will hold steady for the remainder of 2015, absent a significant
decline in operating profitability or a surge in SaaS company growth
rates. Higher valuations, however, will depend on the ability of these
household names to redefine their missions, redirect their resources,
and better capitalize on their significant number of blue-chip
customers.
3Q14
4Q14
1Q15
2Q15
The EV/Revenue multiples of smaller public on-premise software

companies those with revenues <$100 million lagged well behind
their larger counterparts.
After converging in 1Q15, the EV/Rev median public market

multiples of mid size, large and very large on-premise software
companies diverged in Q2, another indication that investors are
comforted by size and incumbency and willing to ignore slowed
growth amidst economic uncertainty.

18
THE SEG SOFTWARE INDEX: PUBLIC MARKET MULTIPLES

EV/Revenue Multiples vs. TTM Revenue Growth 2Q15
7.4x
4.5x
4.2x
4.0x
Median EV/Revenue
Median EV/Revenue
4.5x
EV/Revenue Multiples vs. TTM EBITDA Margins 2Q15
3.0x
2.3x
<= 0%
> 0%
<= 10%
> 10%
<= 20%
> 20%
<= 30%
> 30%
<= 40%
> 40%
While market performance of public on-premise public software

companies remained closely correlated with their TTM revenue
growth rates in Q1, the opposite was true in Q2, with higher
EV/Revenue multiples awarded to companies growing modestly than
those reporting aggressive growth.
A closer look reveals this may not be an aberration. The higher
growth rate companies are mostly newer and smaller than their
slower growth counterparts further confirmation that size and
stability are prized in the current market.
Members of Q2s 40%+ growth club that rewarded investors
handsomely in 2Q15 came from the fastest growing product category,
mobile. Select 2Q15 outperformers included: Glu Mobile (97.5%
TTM revenue growth, 2.9x EV/Revenue), and Qihoo 360 Technology
(82.7% TTM revenue growth, 5.6 x EV/Revenue).
3.9x
> 20%
<= 30%
> 30%
<= 40%
2.4x
1.7x
1.5x
<= 0%
> 0%
<= 10%
TTM Revenue Growth
3.6x
> 10%
<= 20%
> 40%
TTM EBITDA Margin
As in quarters past, the median market multiples of on-premise

software companies generally reflected their median operating
margins.
On premise providers with a median EBITDA margin >40% were

deemed by investors to be almost five times more valuable than those
generating EBITDA margins less than 10%.
On-premise providers with EBITDA margins greater than 40%

included: Check Point Software (54% EBITDA margin, 9.3x
EV/Revenue multiple); Aspen Technology (41%, 8.1x); MSCI (41%,
7.1x); and Evertec (42%, 6.5x).

19
THE SOFTWARE INDEX BY PRODUCT CATEGORY
The SEG Software Index is segmented into 16 product categories.
Among these product categories, market multiples, TTM growth rates and EBITDA margins fluctuate considerably from quarter to quarter. For
example, Engineering/PLM providers saw a decline in median EV/Revenue market multiples from 3.8x in 1Q15 to 3.6x in Q2, despite higher growth.
Conversely, the median market multiple of public ERP companies jumped more than 15% in Q2 from the prior quarter, despite a decline in their
median growth rate.
See Appendix for the complete list of companies within each product category.
Category
2Q14
Billing & Service

Management
Business Intelligence
EV/Revenue
3Q14 4Q14 1Q15
2Q15
2Q14
SEG Software Index

EV/EBITDA
3Q14 4Q14 1Q15 2Q15
2Q14
TTM Revenue Growth

3Q14 4Q14 1Q15
2Q15
2Q14
8.2%
7.6%
18.4% 21.1% 26.6% 26.6% 27.1%
2Q15
1.9x
1.8x
1.8x
1.8x
2.0x
10.1x
9.9x
9.1x
9.7x
10.1x
4.8%
3.3x
3.0x
3.3x
3.6x
3.9x
14.9x
15.3x
14.8x
16.5x
18.3x
13.7% 15.4% 10.0% 10.0% 10.0% 16.8% 16.3% 15.7% 15.7% 15.2%
Development Platforms
2.4x
1.8x
2.0x
2.2x
2.5x
9.4x
9.5x
8.0x
8.8x
9.5x
-0.8%
1.2%
4.1%
4.5%
7.2%
19.2% 19.2% 18.5% 18.5% 18.9%
Engineering & PLM

Enterprise Resource
Planning
Financial & Accounting
4.3x
4.7x
3.4x
3.8x
3.6x
14.9x
15.6x
16.0x
15.7x
17.2x
8.4%
7.4%
7.4%
8.3%
8.7%
20.0% 19.9% 19.9% 20.9% 21.4%
3.6x
3.4x
3.3x
4.0x
4.7x
12.3x
11.9x
11.7x
12.9x
16.6x
2.7%
3.0%
3.4%
2.5%
2.3%
29.5% 28.9% 28.4% 28.4% 28.4%
3.6x
3.3x
3.3x
3.5x
4.1x
12.9x
13.2x
14.8x
14.7x
16.8x
4.7%
2.5%
5.2%
5.2%
4.3%
24.3% 26.0% 23.3% 23.3% 22.3%
Gaming
1.9x
1.5x
1.7x
1.6x
1.4x
12.7x
13.0x
11.4x
12.5x
12.6x
-4.8%
0.2%
-2.2%
-2.2%
2.5%
15.9% 15.5% 15.9% 15.9% 13.0%
Healthcare
2.3x
2.2x
2.4x
2.6x
2.7x
14.2x
15.1x
14.8x
16.4x
16.8x
0.1%
1.1%
3.9%
3.9%
7.1%
14.5% 14.1% 16.0% 16.0% 15.9%
IT Conglomerates
3.3x
3.5x
3.5x
3.1x
3.3x
8.6x
9.6x
9.6x
8.8x
9.3x
2.7%
2.2%
3.4%
2.5%
-0.1% 33.5% 32.8% 34.2% 34.2% 32.9%
Mobile Solutions/Content
2.9x
3.1x
2.9x
2.1x
2.4x
16.2x
18.5x
21.0x
17.7x
17.5x
17.9% 21.1% 22.9% 22.9% 19.1% -0.4%
-1.9%
4.2%
Networking & Network

Performance Management
2.9x
2.2x
2.0x
2.2x
2.3x
15.5x
15.7x
15.7x
13.9x
14.3x
5.1%
8.5%
10.5% 10.2% 10.9%
Security
8.4%
18.3% 18.3%
EBITDA Margin
3Q14 4Q14 1Q15
13.5% 16.2% 13.6%
8.0%
3.2x
3.2x
4.6x
3.9x
3.9x
11.6x
15.0x
16.4x
17.2x
17.1x
16.5% 15.2% 17.6% 18.7% 12.6% 11.5% 12.5%
2.5x
2.6x
2.4x
2.5x
8.2x
9.0x
9.1x
9.3x
9.2x
2.9%
Systems Management
4.5x
5.0x
4.3x
4.1x
4.3x
17.3x
19.2x
18.3x
17.4x
18.3x
13.3% 15.8% 16.2% 16.3% 14.7% 26.0% 25.3% 25.4% 25.4% 26.3%
Vertical - Finance
4.2x
4.1x
4.1x
4.4x
4.3x
13.2x
12.4x
13.7x
16.3x
15.5x
4.8%
Vertical - Other
3.2x
3.4x
3.6x
4.0x
4.6x
23.4x
24.4x
23.9x
26.4x
30.2x
21.2% 16.6% 16.3% 16.3% 13.3% 13.5% 11.6% 11.9% 11.9% 12.9%
Median 3.2x
2.9x
2.9x
3.0x
3.1x
14.8x
13.9x
14.6x
15.3x
16.5x
8.2%
5.8%
8.0%
2.4%
6.2%
8.2%
3.2%
6.2%
8.4%

3.4%
6.5%
6.7%
4.3%
Storage, Data Management

2.5x
& Integration
2.1%
6.7%
4.2%
7.1%
18.0% 17.7% 17.5% 17.3% 16.2%
26.0% 28.8% 29.8% 29.8% 30.3%
8.1% 17.4% 17.6% 18.1% 18.3% 18.3%
20
THE SEG SOFTWARE INDEX BY PRODUCT CATEGORY:

FINANCIAL PERFORMANCE
2Q15 Median TTM Revenue Growth
Billing & Service Management
Engineering & PLM
Enterprise Resource Planning
Gaming
Healthcare
IT Conglomerates (0.1)%
Networking & Network Performance
Security
Storage, Data Management & Integration
Systems Management
Vertical - Finance
Vertical - Other
2Q15 YoY Change in Median Revenue Growth
7.6%
10.0%
7.2%
8.7%
2.3%
4.3%
2.5%
7.1%
19.1%
13.6%
12.6%
3.4%
14.7%
6.5%
13.3%
2Q15 Median TTM EBITDA Margin

Engineering & PLM
Gaming
Healthcare
IT Conglomerates
Security
Systems Management
Vertical - Finance
Vertical - Other

(27.3%)
n/a*
Engineering & PLM
(15.1%)
(8.0%)
Gaming
n/a*
Healthcare
IT Conglomerates (104.8%)
Security
(23.7%)
Systems Management
Vertical - Finance
Vertical - Other
(37.2%)
59.0%
3.3%
5192.6%
6.8%
168.8%
15.6%
10.9%
36.3%
2Q15 YoY Change in Median EBITDA Margin
27.1%
15.2%
18.9%
21.4%
28.4%
22.3%
13.0%
15.9%
32.9%
4.3%
10.9%
7.1%
16.2%
26.3%
30.3%
12.9%

Engineering & PLM
Gaming
Healthcare
IT Conglomerates
Security
Systems Management
Vertical - Finance
Vertical - Other
(9.6%)
(1.2%)
47.1%
7.2%
(3.8%)
(8.4%)
(18.4%)
9.2%
(1.8%)
n/a*
(38.2%)
(10.2%)
37.4%
1.4%
16.7%
(4.9%)
* YoY Change in Median EBITDA Margin or YoY Change in Revenue Growth not applicable.
21
THE SEG SOFTWARE INDEX BY PRODUCT CATEGORY:

PUBLIC MARKET MULTIPLES
2Q15 Median EV/Revenue Multiples
Engineering & PLM
Gaming
Healthcare
IT Conglomerates
Security
Systems Management
Vertical - Finance
Vertical - Other
Median 2Q15 YoY Change in EV/Revenue
2.0x
3.9x
2.5x
3.6x
4.7x
4.1x
1.4x
2.7x
3.3x
2.4x
2.3x
3.9x
2.5x
4.3x
4.3x
4.6x

Engineering & PLM
(16.7%)
Gaming (26.3%)
Healthcare
IT Conglomerates
(15.4%)
Networking & Network Performance (20.0%)
Security
Systems Management
(4.0%)
Vertical - Finance
Vertical - Other
5.1%
18.9%
3.9%
28.7%
12.0%
18.6%
1.3%
22.4%
2.0%
2.1%
43.5%
In 2Q15, nine product categories achieved median EV/Revenue multiples above the SEG Software Index median of 3.3x, led by Enterprise Resource
Planning (4.7x), Vertical Other (4.6x), and Vertical Finance (4.3x).
The Systems Management and Security categories are benefitting from the continuing shift to cloud and mobile computing, which require new approaches
to scaling, managing and securing these new environments.
The Gaming category closed 2Q15 with a median EV/Revenue multiple of 1.4x, the lowest of our 16 product categories. Weve predicted in past Reports
that gaming multiples would improve as gaming providers - caught flat footed by the explosion of mobile and Internet gaming - repositioned with online
and mobile games suitable for a multi-device world. It hasnt happened yet.
The median TTM revenue growth rate accelerated in 11 of 16 product categories in 2Q15. The eleven categories with higher YoY EV/Revenue multiples
included: Billing & Service Management, Business Intelligence, Development Platforms, Enterprise Resource Planning, Financial & Accounting, Healthcare,
IT Conglomerates, Security, Storage, Vertical Finance (i.e. software providers focused on the financial services vertical), and Vertical - Other.

22
THE SEG SaaS INDEX

PUBLIC SaaS COMPANY FINANCIAL PERFORMANCE AND MARKET MULTIPLE TRENDS

THE SEG SaaS INDEX

SEG - SaaS: Median Metrics
Measure
2Q14
EV/Revenue
7.0x
EV/EBITDA
EV/Earnings
3Q14
4Q14
6.9x
5.8x
57.0x
41.5x
75.4x
119.5x
1Q15
2Q15
5.5x
6.0x
29.2x
37.3x
49.3x
70.4x
115.3x
70.0x
Gross Profit Margin
65.3%
65.6%
65.1%
65.1%
65.3%
EBITDA Margin
-8.9%
-11.2%
-13.2%
-13.1%
-11.3%
Net Income Margin

TTM Revenue Growth
-17.0%
30.1%
-15.9%
29.8%
-21.2%
32.2%
-21.2%
32.1%
-16.9%
29.9%
$117.8
$125.4
$150.0
$150.0
$163.7
TTM EBITDA Growth
19.4%
10.7%
24.1%
24.1%
29.7%

Cash & Eq ($M)
Current Ratio
-$8.4
$79.3
2.2
-$7.6
$85.1
2.1
-$9.4
$112.6
2.0
-$10.2
$112.6
2.1
-$9.4
$106.8
1.9
Debt / Equity Ratio
4.2%
3.4%
3.0%
3.0%
4.2%
The SEG SaaS Index tracks public companies that primarily offer
hosted, on-demand software under a subscription and/or transaction
based pricing model.
The SEG SaaS Index is currently comprised of an all-time high of 65

publicly traded, pure-play SaaS companies.*
* See appendix for complete list of companies in the SEG SaaS Index
24
THE SEG SaaS INDEX: FINANCIAL PERFORMANCE

TTM Revenue Growth
29%
32.5%
$160
32.0%
$140
31.5%
$120
31.0%
$100
30.5%
$80
30.0%
$60
$40
29.5%
$20
29.0%
$0
28.5%
2Q14
3Q14
4Q14
1Q15
24%
% of Companies
$180
TTM Revenue Growth
TTM Total Revenue
14%
14%
12%
5%
2%
<= 0%
> 0%
<= 10%
> 10%
<= 20%
2Q15
> 20%
<= 30%
> 30%
<= 40%
> 40%
<= 50%
> 50%
TTM Revenue Growth
The median TTM revenue growth rate of Public SaaS companies in 2Q15 was 29.9%, down just a tick below 30.1% in 2Q14. We anticipate only marginally
higher growth in Q3, mostly due to floundering GDP growth and IT spending.
Median growth rates alone do not capture the standout performances of the most successful SaaS companies. Nearly one in four public SaaS companies
grew TTM revenue by 50% or more. As further testament to the widespread and ramping adoption of SaaS, these outperformers come from a variety of
product categories including Human Capital Management, Life Sciences, Marketing, Security, and Business Intelligence. Especially noteworthy were:
Castlight Health (173.5%); FireEye (130.3%); Medical Transcription Billing (102.3%); DealerTrack (78.5%); Tableau Software (75.4%); New Relic
(74.4%); Zendesk (72.4%); and Workday (63.7%).
The median TTM revenue of public SaaS companies was $163.7M in 2Q15, a significant YoY increase from 2Q14s $117.8M. In part, the revenue growth is
attributable to wider, and deeper, enterprise adoption of hosted solutions; and in part the revenue growth is inorganic, as the group has become
increasingly acquisitive.
Salesforce continued to lead the SaaS revenue pack by several lengths, reporting 2Q15 TTM revenue of $5.7B, almost 6x greater than the next largest
public SaaS company. Still, many public SaaS companies reached critical revenue mass (>$350 million) in 2Q15, a feat made more difficult by a revenue
model that requires deferring a significant percentage of booked revenue. SaaS providers with revenues of $350M+ can now be found among a wide array
of product categories and industry sectors, including Workday (HCM/Financial, $879.1M); DealerTrack (Automotive, $948.4M); RealPage (Real Estate,
$414.5M); and Service-Now (IT Service Mgmt., $755.4M).

25

EBITDA Margin
2Q14
3Q14
4Q14
1Q15
2Q15
% of Companies
59%
18%
16%
(8.9%)
(11.3%)
(11.2%)
(13.2%)
(13.1%)
The median EBITDA margin of public SaaS companies remained

negative but improved, closing 2Q15 at -11.3%.
Almost three out of five (59%) public SaaS companies are

unprofitable, and nine out of ten have EBITDA margins below the
20% median of their on-premise software peers.
For the time being, investors are untroubled by the operating losses, if
the strong correlation between their EV/Revenue market multiples
and TTM revenue growth rates (see slide 29) is any indication.
Apparently, the public markets have come to understand the GAAP

compliant P&L statements of many public SaaS companies, which
seem to indicate theyre suffering significant losses and hemorrhaging
cash, dont tell the whole story. Many are not only cash flow positive,
but flushed with revenue from prepaid subscription fees that require
deferred recognition under GAAP. As example, for the year ended
June 2015, NetSuite reported a $109.6M net loss, but was cash flow
positive from operations to the tune of $89.1M.
<= 0%
> 0%
<= 10%

> 10%
<= 20%
4%
4%
> 20%
<= 30%
> 30%
TTM EBITDA Margin
26

S&M (% of Revenue)
R&D (% of Revenue)
G&A (% of Revenue)
Gross Profit Margin
45%
EBITDA Margin
Net Income Margin
70%
40%
60%
50%
30%
40%
25%
20%
% Margin
% of Revenue
35%
15%
10%
30%
20%
10%
5%
0%
2Q14
3Q14
4Q14
1Q15
2Q15
0%
2Q14
3Q14
4Q14
1Q15
2Q15
-10%
-20%
OpEx: Public SaaS companies continue to spend heavily on sales & marketing in order to drive revenue growth and capture market share.
In 2Q15, public SaaS companies invested a median 40.2% of total revenue on sales & marketing, almost double their on-premise counterparts.
R&D spending as a percent of revenue remained almost flat in 2Q15, declining to 19.5% from 19.7% a year earlier. Public SaaS companies in 2Q15 spent
4.4% more on R&D as a percent of revenue than their on-premise peers, as they endeavored to expand their offerings, enhance their technology and
platforms, and address new markets
On a GAAP basis, operating losses of public SaaS companies grew throughout 2014, bottoming out at a -13.2% median EBITDA margin in 4Q14. After
barely improving in 1Q15 (-13.1%), the median public SaaS company EBITDA margin inched closer to break even in 2Q15 at -11.3%.

27
THE SEG SaaS INDEX: PUBLIC MARKET MULTIPLES

EV/Revenue
EV/Revenue Multiple Distribution 2Q15
EV/EBITDA
36%
57.0x
41.5x
% of Companies
49.3x
37.3x
29.2x
7.0x
2Q14
6.9x
3Q14
5.8x
4Q14
5.5x
1Q15
6.0x
2Q15
19%
10%
5%
7%
5%
2%
8%
7%
2%
<= 1.0x > 1.0x > 2.0x > 3.0x > 4.0x > 5.0x > 6.0x > 7.0x > 8.0x > 9.0x
<= 2.0x <= 3.0x <= 4.0x <= 5.0x <= 6.0x <= 7.0x <= 8.0x <= 9.0x
EV/Revenue
At the close of 2Q15, the median market multiple of public SaaS companies was 6.0x EV/Revenue, down 14% YoY, but up slightly from last quarters
median multiple of 5.5x.
Yet investors were goggle-eyed about the prospects of a good number of public SaaS providers. More than one-third of the companies in the SEG SaaS
Index achieved a median EV/Revenue multiple of 9x or higher in 2Q15, and public SaaS companies continued to trade at a significant premium to their onpremise peers (6.0x vs. 3.1x median EV/Revenue). Although public SaaS companies have historically enjoyed trading multiples about double their onpremise peers, the differential is shrinking. 2Q15s premium of 94% was much lower than 2Q14s 119% premium.
A premium market multiple can be largely justified by comparing the relative lifetime value of a SaaS customer vs. an on-premise licensee. A SaaS
company with a mission critical hosted app and strong customer retention will garner significantly greater cash over time (typically, 10+ years) from its
average customer than will its on-premise counterpart. As for profitability, it remains to be seen if SaaS companies can eventually achieve bottom line
performances that are equivalent to their on-premise counterparts.
In the meantime, investors are placing their bets on the next wave of SaaS category leaders that are positioned to displace incumbent on-premise
providers across multiple product categories - just as Salesforce did to Siebel years ago in the CRM category.

28


8.0x
11.9x
7.2x
6.9x
5.0x
5.2x
> 20%
<= 30%
> 30%
<= 40%
Median EV/Revenue
Median EV/Revenue
9.5x
3.7x
5.5x
3.7x
2.3x
0.0x
<= 0%
> 0%
<= 10%
> 10%
<= 20%
> 40%
<= 50%
> 50%
<= 0%
> 0%
<= 10%
TTM Revenue Growth
> 10%
<= 20%
> 20%
<= 30%
> 30%
TTM EBITDA Margin
In 2Q15, investors continued to handsomely reward the fastest growing public SaaS companies, albeit more modestly than in Q1. Public SaaS companies
that grew TTM revenue in excess of 50% were anointed with the highest median EV/Revenue multiple of 11.9x in 2Q15, compared to a median market
multiple of 13x in the prior quarter.
In past years, investors deemed profitability to be an unacceptable tradeoff for accelerated growth. That trend has ameliorated over the past three
quarters, as public SaaS companies have grown larger and growth rates have stalled. In Q2, investors favored public SaaS companies losing money but
perceived to be investing heavily in rapid growth, as well as those that are demonstrating not only sustained growth, but moderate profitability, as well.
The older view, however, prevailed for those SaaS companies deemed to be too profitable (30%+), which investors saw as unacceptable tradeoff against
accelerated growth.

29

Company
Shopify
Workday
Tableau Software
Service-now.com
FireEye
HortonWorks
Paycom Software
Netsuite
New Relic
Demandware
Zendesk
HubSpot
Paylocity Holding
Castlight Health
Box
Ellie Mae
Textura
Veeva Systems
Qualys
2U
Q2 Holdings
MINDBODY
The Ultimate Software Group
Salesforce.com
Medidata Solutions
AppFolio
SPS Commerce
Benefitfocus
Marketo
Cvent
Fleetmatics
Athenahealth
Cornerstone OnDemand
Apigee Corporation
Ebix
J2 Global
Xactly
Callidus Software
TrueCar
Zix
RingCentral
HealthStream
Workiva
Yodlee
Alarm.com
RealPage
OPOWER
inContact
SciQuest
DealerTrack
Amber Road
ChannelAdvisors
IntraLinks Holdings
LivePerson
Halogen Software
Constant Contact
Tangoe
Bazaarvoice
Upland Software
Marin Software
Jive Software
Medical Transcript
Covisint
Ticker
EV (Median)
SHOP
$2,293
WDAY
$15,043
DATA
$7,253
NOW
$11,412
FEYE
$6,666
HDP
$841
PAYC
$2,045
N
$7,220
NEWR
$1,327
DWRE
$2,142
ZEN
$1,699
HUBS
$1,481
PCTY
$1,565
CSLT
$587
BOX
$2,360
ELLI
$1,752
TXTR
$652
VEEV
$3,163
QLYS
$1,316
TWOU
$1,106
QTWO
$799
MB
$691
ULTI
$4,669
CRM
$48,443
MDSO
$2,969
APPF
$453
SPSC
$979
BNFT
$1,037
MKTO
$1,121
CVT
$960
FLTX
$1,539
ATHN
$4,760
CSOD
$1,673
APIC
$369
EBIX
$1,255
JCOM
$3,362
XTLY
$333
CALD
$722
NasdaqGS: TRUE$1,052
ZIXI
$239
RNG
$1,070
HSTM
$799
WK
$495
YDLE
$380
ALRM
$675
RP
$1,529
OPWR
$453
SAAS
$594
SQI
$306
TRAK
$2,781
AMBR
$189
ECOM
$219
IL
$614
LPSN
$516
TSX:HGN
$135
CTCT
$753
TNGO
$473
BV
$403
UPLD
$138
MRIN
$173
JIVE
$305
MTBC
$24
COVS
$41
TTM
Revenue
$124
$879
$468
$755
$477
$60
$169
$598
$110
$178
$144
$130
$141
$53
$237
$184
$68
$336
$141
$119
$86
$77
$530
$5,658
$351
$54
$136
$149
$164
$152
$245
$796
$280
$65
$227
$626
$64
$145
$221
$51
$237
$179
$120
$94
$176
$414
$133
$186
$102
$948
$65
$88
$263
$222
$59
$343
$216
$191
$66
$103
$185
$22
$89
TTM
Revenue
Growth
63.7%
75.4%
58.1%
130.3%
96.6%
44.6%
34.2%
74.7%
50.2%
73.3%
52.7%
40.9%
173.5%
62.0%
41.4%
48.6%
43.7%
24.0%
31.2%
42.0%
22.2%
28.4%
20.9%
24.1%
33.9%
50.9%
28.6%
28.5%
25.9%
36.7%
11.4%
15.7%
23.4%
44.8%
5.6%
36.8%
27.3%
28.6%
26.2%
26.9%
6.7%
35.7%
37.4%
7.9%
78.5%
16.3%
21.7%
10.1%
21.2%
18.2%
15.9%
10.9%
13.7%
38.1%
24.1%
20.8%
102.3%
-8.9%
EV/
Rev
18.6x
17.1x
15.5x
15.1x
14.0x
13.9x
12.1x
12.1x
12.0x
12.0x
11.8x
11.4x
11.1x
11.0x
10.0x
9.5x
9.5x
9.4x
9.4x
9.3x
9.2x
9.0x
8.8x
8.6x
8.5x
8.4x
7.2x
6.9x
6.8x
6.3x
6.3x
6.0x
6.0x
5.7x
5.5x
5.4x
5.2x
5.0x
4.8x
4.7x
4.5x
4.4x
4.1x
4.0x
3.8x
3.7x
3.4x
3.2x
3.0x
2.9x
2.9x
2.5x
2.3x
2.3x
2.3x
2.2x
2.2x
2.1x
2.1x
1.7x
1.7x
1.1x
0.5x
TTM
EBITDA
-$15
-$152
$10
-$122
-$400
-$188
$30
-$50
-$45
-$20
-$67
-$49
-$9
-$80
-$147
$38
-$13
$82
$27
-$26
-$14
-$23
$71
$241
$39
-$8
$14
-$52
-$52
$2
$63
$62
-$47
-$50
$82
$256
-$13
-$4
-$42
$9
-$31
$31
-$37
-$4
$23
$25
-$41
-$9
$5
$115
-$7
-$27
$12
$11
-$9
$41
$17
-$22
$1
-$27
-$32
-$3
-$27
EBITDA
Margin
-11.9%
-17.3%
2.2%
-16.1%
-83.8%
-311.3%
17.6%
-8.3%
-40.7%
-11.5%
-46.5%
-37.5%
-6.7%
-150.6%
-61.9%
20.9%
-18.8%
24.2%
19.0%
-21.9%
-16.2%
-30.4%
13.4%
4.3%
11.3%
-14.9%
10.2%
-34.7%
-31.9%
1.5%
25.9%
7.8%
-16.9%
-76.9%
36.2%
40.9%
-19.7%
-2.5%
-19.1%
16.9%
-13.1%
17.3%
-30.9%
-3.7%
12.9%
5.9%
-30.4%
-4.9%
4.6%
12.1%
-10.8%
-31.1%
4.6%
5.0%
-16.0%
11.8%
7.7%
-11.3%
1.8%
-26.3%
-17.2%
-11.8%
-30.4%
EV/
EBITDA
711.2x
68.7x
45.7x
38.8x
49.3x
65.7x
201.0x
75.2x
70.3x
432.9x
24.3x
76.6x
15.3x
13.1x
27.6x
25.7x
29.5x
62.3x
64.6x
24.2x
50.7x
46.6x
18.6x
28.5x
118.8x
-
When the SEG SaaS Index is segmented on

the basis of median EV/Revenue multiple,
the top 25% boasted an impressive median
9.5x in 2Q15. That median, however, was
29% lower than Q1s median EV/Rev
multiple of 13.2x. Although thats likely a
reflection of Q2s greater market volatility, it
may be an indicator of waning investor
enthusiasm for SaaS stocks.
These SaaS high flyers are market leaders in

a wide array of SaaS categories including
security
(FireEye);
HCM/Finance
(Workday); ERP (NetSuite); eCommerce
(Demandware); and Vertically Focused
(Castlight Health Healthcare ERP).
The median TTM revenue growth rate of

those in the top 25% percentile was 47.7%.
All but three companies (Tableau Software,
Paycom, and Ellie Mae) in the top rank had a
negative EBITDA margin in 2Q15.
In contrast, the median TTM revenue

growth rate of those comprising the bottom
25% of EV/Revenue multiples was 21.3%,
and almost half of these companies were
profitable.
Top 25%
Bottom 25%

30
THE SEG SaaS INDEX BY PRODUCT CATEGORY:

CRM &
Marketing
2Q15 YoY Change in Median Revenue Growth
CRM &
Marketing
28.4%
ERP &
Supply Chain
ERP &
Supply Chain
26.3%
Vertically
Focused
38.5%
Human
Capital
Management
(24.1%)
Vertically
Focused
37.0%
Human
Capital
Management
33.9%

CRM &
Marketing
(5.8%)
17.8%
2Q15 YoY Change in Median EBITDA Margin

CRM &
Marketing
(11.3%)
n/a*
ERP &
Supply Chain
Vertically
Focused
Human
Capital
Management
ERP &
Supply Chain
(8.3%)
5.9%
(11.3%)
Vertically
Focused
n/a*
(31.3%)
Human
Capital
Management
n/a*
* YoY Change in Median EBITDA Margin not applicable.

31
THE SEG SaaS INDEX BY PRODUCT CATEGORY:

2Q15 Median EV/Revenue Multiple
2Q15 YoY Change in Median EV/Revenue
CRM &
Marketing
6.3x
CRM &
Marketing
ERP &
Supply Chain
6.3x
ERP &
Supply Chain
Vertically
Focused
Human
Capital
Management
8.4x
6.5x
Vertically
Focused
101.1%
(18.3%)
(14.5%)
Human
Capital
(31.2%)
Management
Public SaaS companies comprising the Vertically Focused category posted the highest median public market multiple (8.4x EV/Revenue) of our four SaaS
tracking categories in 2Q15. The category was led by Castlight Health (11.0x EV/Revenue multiple) and Textura (9.5x EV/Revenue). As the SaaS delivery
model matures, investors are favoring newer, vertically oriented, best of breed providers that are rapidly gaining share in large vertical markets, often at
the expense of larger, slower and less vertically focused SaaS and on-premise providers.
The market success of Vertically Focused SaaS companies was largely attributable to their having achieved the highest TTM revenue growth rate in 2Q15,
38.5%. Category standouts included healthcare spend management SaaS provider, Castlight Health (174% TTM revenue Growth); construction sector
SaaS vendor, Textura (49% TTM revenue growth); and life sciences SaaS vendor, Veeva Systems (44% TTM revenue growth).
In 2Q15, the CRM & Marketing category saw the only positive YoY change in Median EV/Rev, thanks to a number of recent IPOs that have rapidly gained
traction, including Shopify (18.6x EV/Rev, 109% TTM revenue growth); Zendesk (11.9x EV/Rev, 73% TTM revenue growth); and Hubspot, 11.4x EV/Rev
of 11.4x, 53% TTM revenue growth

32
THE SEG INTERNET INDEX

PUBLIC INTERNET COMPANY FINANCIAL PERFORMANCE AND MARKET MULTIPLE TRENDS

THE SEG INTERNET INDEX

SEG - Internet: Median Metrics
Measure
EV/Revenue
EV/EBITDA
EV/Earnings
Gross Profit Margin
EBITDA Margin
Net Income Margin
TTM Revenue Growth
TTM EBITDA Growth
Cash & Eq ($M)
Current Ratio
Debt / Equity Ratio
2Q14
3.0x
23.5x
35.1x
65.2%
8.5%
-0.1%
19.1%
$361.3
15.4%
$28.6
$182.7
2.5
1.5%
3Q14
2.9x
20.1x
31.4x
63.3%
7.9%
-0.5%
20.5%
$409.8
13.1%
$28.4
$192.8
2.5
1.6%
4Q14
2.5x
21.4x
35.4x
64.2%
7.8%
-0.2%
19.4%
$440.2
13.9%
$23.9
$188.2
2.2
3.1%
1Q15
2.4x
22.0x
36.3x
63.7%
7.8%
-0.2%
19.4%
$440.2
13.9%
$23.9
$188.2
2.2
3.1%
2Q15
2.4x
20.0x
36.3x
63.8%
7.9%
-0.2%
19.0%
$451.2
12.0%
$23.6
$200.2
2.4
3.7%
The SEG Internet Index tracks public companies that primarily offer
B2C and B2B solutions over the Internet using a wide array of pricing
models.
The SEG Internet Index is currently comprised of 105 public Internet

companies*.
* See appendix for complete list of companies in the SEG Internet Index
34
THE SEG INTERNET INDEX: FINANCIAL PERFORMANCE

23%
TTM Revenue Growth

20%
21.0%
$450
$350
20.0%
$300
$250
19.5%
$200
19.0%
$150
$100
18.5%
$50
$0
TTM Revenue Growth
20.5%
$400
% of Companies
$500
TTM Total Revenue
17%
6%
<= 0%
> 0%
<= 10%
18.0%
2Q14
3Q14
4Q14
1Q15
17%
17%
> 10%
<= 20%
> 20%
<= 30%
> 30%
<= 40%
> 40%
TTM Revenue Growth
2Q15
Approximately 59% of the companies comprising the SEG Internet

Index offer online services and solutions primarily or exclusively to
consumers; their revenue growth typically lags a quarter behind the
performance of the U.S. economy.
After declining from 20.5% growth in 3Q14 to 19.4% in both 4Q14

and 1Q15, median TTM revenue growth of the SEG Internet Index
dropped to 19% in 2Q15.
Once again demonstrating the Internet is an ecosystem of unequals,

23% of public Internet providers far outpaced the pack, posting TTM
revenue growth greater than 40% in 2Q15. These high flyers
included LendingClub (110.6%), Twitter (98.3%), and YY (91.4%).
Conversely, 34% of public Internet companies struggled to advance,

reporting TTM revenue growth of 10% or less in 2Q15. The slow
growers included VeriSign, Yahoo!, Zynga, Brightcove, and Monster
Worldwide.
35

31%
7.9%
7.8%
7.8%
28%
7.9%
EBITDA Margin
% of Companies
8.5%
18%
11%
8%
4%
2Q14
3Q14
4Q14
1Q15
2Q15
The median EBITDA margin of the SEG internet Index has remained
relatively flat for the last four quarters.
Almost 30% of SEG Internet Index companies were unprofitable in

2Q15. The median S&M spend as a percent of revenue of public
Internet companies remained virtually unchanged in 2Q15 at 25.5%.
At the other end of the spectrum, 4% of public Internet companies,

mostly those with significant transaction or advertising revenue,
achieved EBITDA margins above 40%, led by VeriSign (62.0%),
Mail.ru Group (48.6%) and Tencent Holdings (41.0%).
With few exceptions, many of the most profitable public Internet

companies reported stellar TTM revenue growth. Among them were
Tencent Holdings (50.0% EBITDA margin, 27.2% revenue growth);
Facebook (46.6% EBITDA margin, 51.5% revenue growth); Yandex
(36.4% EBITDA margin, 23.2% revenue growth); and Baidu.com
(32.3% EBITDA margin, 47.4% revenue growth).
<= 0%
> 0%
<= 10%

> 10%
<= 20%
> 20%
<= 30%
> 30%
<= 40%
> 40%
TTM EBITDA Margin
36

S&M (% of Revenue)
R&D (% of Revenue)

G&A (% of Revenue)
Gross Profit Margin
EBITDA Margin
Net Income Margin
70%
30%
60%
25%
40%
% Margin
% of Revenue
50%
20%
15%
10%
5%
30%
20%
10%
0%
0%
2Q14
3Q14
4Q14
1Q15
2Q14
2Q15
3Q14
4Q14
1Q15
2Q15
-10%
OpEx: Median spending on operations by public Internet companies in 2Q15 was consistent with historic norms: 14.2% for Research & Development,
25.5% for Sales & Marketing, and 12.4% for General & Administrative.
Over the past year, S&M, R&D and G&A expenses as a percent of revenue have remained relatively flat.
The median R&D spend as a percent of total revenue was the lowest among our three tracking indices.
Public internet companies have kept their cost structures in line, resulting in a median EBITDA margin of 7.9% in 2Q15, virtually the same as the past
three quarters.

37
THE SEG INTERNET INDEX: PUBLIC MARKET MULTIPLES

EV/Revenue
23%
EV/EBITDA
23.5x
21.4x
19%
22.0x
20.0x
% of Companies
20.1x
Median EV/Revenue Multiple Distribution 2Q15
14%
12%
9%
7%
6%
4%
3.0x
2Q14
2.9x
3Q14
2.5x
4Q14
2.4x
1Q15
2%
2.4x
2Q15
5%
<= 1.0x > 1.0x > 2.0x > 3.0x > 4.0x > 5.0x > 6.0x > 7.0x > 8.0x >= 9.0x
<= 2.0x <= 3.0x <= 4.0x <= 5.0x <= 6.0x <= 7.0x <= 8.0x <= 9.0x
EV/Revenue
The median public market EV/Revenue multiple of public Internet providers closed 2Q15 at 2.4x, on par with the first quarter, but notably lower than the
3.0x multiple of a year ago. More than 40% of public Internet companies closed Q2 with an EV/Revenue multiple of 2.0x or less.
We believe Q2s depressed Internet market multiple reflected continuing investor caution about a sustained economic recovery and its concomitant
impact on consumer spending. Almost 60% of public Internet companies are consumer focused (Travel, Games, Retail, Advertising, etc). Until wages
improve and consumer confidence is restored, its likely Internet providers will continue to lag well behind their SaaS and on-premise peers in market
multiples.
That said, investors in Q2 continued to richly reward the most rapidly growing and most promising Internet providers, especially those that generated
significant revenue from online advertising and ecommerce. More than one in five closed the quarter with a market multiple of 7.0x EV/Revenue or
higher, include 58.com (27.5x EV/Rev), Alibaba (16.9x), Facebook (16.0x); Wowo Limited (15.2x); and Zillow (13.1x).

38
THE SEG INTERNET INDEX: PUBLIC MARKET MULTIPLES

6.4x
7.0x
6.8x
Median EV/Revenue
Median EV/Revenue
5.2x
4.0x
1.9x
2.0x
5.0x
<= 0%
> 0%
<= 10%
> 10%
<= 20%
> 20%
<= 30%
> 30%
<= 40%
> 40%
2.0x
1.9x
1.3x
1.1x
<= 0%
> 0%
<= 10%
TTM Revenue Growth
> 10%
<= 20%
> 20%
<= 30%
> 30%
<= 40%
> 40%
TTM EBITDA Margin
Here, too, investors favored growth. Public Internet companies with TTM revenue growth of 30% or higher had a median EV/Revenue multiple of 6.4x in
Q2, compared to 2.0x for their slower growing (<20%) peers. The outperformers included Twitter (98.3%, 14.1x EV/Revenue); 58.com (78.5%, 27.5x
EV/Revenue); Zillow (72.1%, 13.1x EV/Revenue); and Facebook (51.5%, 16.0x EV/Revenue).
Investors in public Internet companies kept a keen eye on margins, and rewarded more profitable performers with significantly higher public market
multiples. Public Internet companies with EBITDA margins above 40% posted a median EV/Revenue multiple of 6.8x in 2Q15, 283% higher than the
overall Index median. By comparison, public SaaS companies with EBITDA margins above 30% (not enough companies with 40%+) posted a median
EV/Revenue multiple of 5.5x in Q2, 20% below the SaaS median market multiple.
When valuing Internet vs. SaaS stocks, investors have clearly taken into consideration the likely longevity of the customer relationship and associated
recurring revenue, and the nature and extent of switching costs. By those measures, the likely lifetime value of a SaaS customer appears to greatly
outweigh the perceived value of an online consumer.

39
THE SEG INTERNET INDEX BY PRODUCT CATEGORY
The SEG Internet Index is segmented into nine product categories.
Representative companies in each Internet category are referenced below.
See the appendix for the complete list of companies within each product category.
Ad Tech
Infrastructure
Commerce
Search
Content & Media
Services
Social

Gaming
Travel
40
THE SEG INTERNET INDEX BY PRODUCT CATEGORY:

Ad Tech
Ad Tech
22.1%
Commerce
Infrastructure
4.9%
22.5%
Social
51.5%
Travel
Travel
(19.2%)
Social
(17.5%)
1.0%
Ad Tech
Commerce
5.3%
Content & Media
10.9%
28.6%
(35.6%)
(45.7%)
(32.2%)
Gaming
(4.2%)
16.5%
Infrastructure
5.8%
Search
Social
Services
2Q15 Median YoY Change in EBITDA Margin
2.0%
Gaming
Services
(15.8%)
Travel
20.4%
Content & Media
92.3%
(51.3%)
Search
20.1%
Services
Infrastructure
(17.6%)
Gaming
23.4%
Search
Commerce
7.5%
Content & Media
10.0%
Gaming
Ad Tech
(19.7%)
Commerce
17.7%
Content & Media
Infrastructure
2Q15 Median YoY Change in Revenue Growth
32.3%
Search
Services
5.9%
10.1%
12.4%
(11.9%)
(21.8%)
Social
Travel

1.6%
(20.5%)
41
THE SEG INTERNET INDEX BY PRODUCT CATEGORY:

2Q15 Median EV/Revenue Multiples
Ad Tech
Commerce
2.3x
Ad Tech
1.9x
Content & Media
2.8x
Content & Media
Infrastructure
1.5x
Search
5.6x
Services
2.4x
Social
Travel
64.0%
(25.7%)
Gaming
3.1x
Search
Services
(17.7%)
Commerce
Gaming
Infrastructure
Median 2Q15 YoY Change in EV/Revenue
9.1x
3.8x
(13.8%)
(25.4%)
(17.3%)
(24.1%)
Social
Travel
(13.7%)
(30.0%)
Public Internet companies comprising the Social product category closed Q2 with a median revenue growth rate of 51.1%, roughly 3x the overall Internet
median growth rate of 18.4%. The Gaming product category ended Q2 with a median revenue growth rate of 23.4%, roughly 1.5x greater than Q2s
Internet median.
Public Internet companies comprising the Social category closed 2Q15 with the highest median EV/Revenue multiple, 9.7x, led by Facebook (16.1x) and
Twitter (14.1x).
The success social media Internet providers have had monetizing their services, largely through advertising, has come at the expense of many in the Ad
Tech space, with marketers clearly favoring the scalability and ROI of advertising on Twitter and Facebook. As a result of these shifting advertising
priorities, the median TTM revenue growth of the Ad Tech product category fell 17.7% YoY in 2Q15.
Companies within the Search product category continued to be very profitable in Q2, posting a median EBITDA margin of 32.3%, 3.8x higher than the
median EBITDA margin across all Internet categories in 2Q15.
Following a correction in public software industry valuations witnessed throughout 2014, eight of our nine product categories experienced a decline in
YoY EV/Rev multiples.

42
SOFTWARE INDUSTRY M&A MARKET UPDATE

2Q15 SOFTWARE / SAAS M&A DEAL VOLUME AND SPENDING

U.S. Software Mergers & Acquisitions Activity
$12.3
$15.8
$20.8
$20.2
$17.8
$22.8
$17.7
$20
$15
$10
$9.9
$5
$0
2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14 4Q14 1Q15 2Q15
Deals
Value
$40.0
$36
$36 $35
$30.0
$20.0
$10.0
$0.0
2Q15
$26.6
$57
$43
1Q15
100
$25
$40
4Q14
200
$23.1
$39
3Q14
300
$42
2Q14
$30
$53
$50.0
1Q14
$35
4Q13
$36.8
$31.4
$60
$53 $54
3Q13
$40
$43.5
2Q13
406 394
$60.0
1Q13
400
499
$65
4Q12
435
455 460
431 444
$45
3Q12
454
$70.0
Value (BIllions)
Number of Deals
500
488 505
$50
2Q12
517
555
TTM Average Deal Value (Millions)
600
Average On-Premise Software Deal Size
There were 555 reported software M&A transactions in 2Q15, a new quarterly record. The second quarter tally will likely increase by approximately 15
20 transactions as unpublicized deals are added. Typically, the second quarter has been the most active, following a relative Q1 lull spent digesting their
year-end deals.
Software M&A spending in 2Q15 totaled $36.8 billion, almost double Q1 2015s $17.8 billion aggregate price tag. Included were twelve mega deals
(EV>$500M), four with price tags exceeding $2 billion. The two largest were Permira Advisers $4.8 billion (~4.6x EV/Rev) acquisition of Informatica
Corporation, and Cox Automotives $4.5 billion (4.7x EV/Revenue) acquisition of Dealertrack Technologies.
Other 2Q15 mega deals included EMCs acquisition of Virtustream ($1.2B, ~10.0x EV/Rev), MasterCards acquisition of Applied Predictive Technologies
($600M, ~6.0 EV/Rev); and Twitters acquisition of TellApart ($533M, ~6.0 EV/Rev).
Megadeals aside, most buyers continued to focus on small and mid-sized acquisitions in 2Q15, consistent with their response to our 2015 Buyers Survey,
in which 95% of respondents indicated they would focus in 2015 on deals in the range of $10M - $99M .
44
SOFTWARE M&A EXIT MULTIPLES

Median Exit Multiples
20.0x
18.1x
18.0x
17.7x
EV/EBITDA
16.2x
17.5x
14.0x
12.0x
10.0x
8.0x
6.0x
2.3x
2.4x
2.3x
2.5x
2.5x
2.0x
20.0%
15.0%
13.3%
12.5%
10.0%
13.3%
7.5%
5.0%
1.7%
0.0%
0.0x
2Q14
3Q14
4Q14
1Q15
<= 1.0x
2Q15
The median EV/Rev exit multiple for on-premise software providers

was 2.5x in 2Q15, matching the prior quarters all-time high exit
multiple. That makes five consecutive quarters the median exit
multiple has reached 2.3x EV/Rev or higher.
After a significant shakeout following the Great Recession, many of

the public on-premise providers left standing are considered to be
compelling, highly valued targets by an array of public and private
equity acquirers, but buyer motives varied widely. Some sought to
extend their reach into entirely new markets (Cox
Automotive/Dealertrack); some saw competitive advantage
(Mastercard/Applied Predictive); and some were active investors
demanding a higher return for shareholders (Permira/Informatica).
23.3%
25.0%
17.3x
16.0x
4.0x
28.3%
30.0%
% of Deals - 2Q15 TTM
EV/Revenue
Median EV/Revenue Exit Multiple Distribution
The median EV/EBITDA exit multiple for public on-premise software

companies held relatively steady at healthy 17.3x TTM EBITDA.
> 1.0x & > 2.0x & > 3.0x & > 4.0x &
<= 2.0x
<= 3.0x
<= 4.0x
<= 5.0x
TTM Revenue Exit Multiple Bins
> 5.0x &

<= 6.0x
> 6.0x
On a TTM basis, 35.8% of all on-premise software targets in 2Q15

were acquired for 2.0x TTM revenue or less, and 64.1% for 3.0x or
less.
Most targets receiving an exit multiple of 3.0x or higher belonged to

currently hot software product categories that are experiencing
rapid market adoption and growth, including Financial Services and
Mobile.
Helping to keep the on-premise multiple at an all time high was

Amino Technologies acquisition of mobile video content provider
Boox Media ($11.1 million, 7.1x TTM revenue); MasterCards
acquisition of predictive analytics software provider Applied
Predictive Technologies ($600M, ~6.0 EV/Rev); and Cox Automotives
acquisition of automotive retail industry solutions provider
Dealertrack Technologies ($4.5B, 4.7x EV/Rev).

45
SOFTWARE M&A: BY OWNERSHIP STRUCTURE AND SIZE

Public vs. Private Target
Large Vs. Smaller Buyer
Of the TTM deals announced with an ascertainable EV/Rev exit

multiple, nearly four out of five software M&A transactions featured
privately-held targets.
Buyers with revenue greater than $200 million paid a median 2.8x
TTM revenue for their targets, compared to a median 1.9x TTM
revenue paid by sub-$200 million revenue buyers.
The median TTM exit multiple in Q2 was only marginally higher for
public on-premise software sellers (2.4x TTM revenue) than for their
private counterparts (2.3x TTM revenue).
Over the last 12 months, public buyers paid a median 2.2x TTM
revenue for their targets, compared to a median of 2.5x paid by
private buyers.
On a TTM basis, software M&A transactions with the highest exit

multiples featured a large public or private buyer (greater than $200
million in revenue) acquiring a small target (less than $20 million).
For the last 12 months, this match-up produced a median 3.1x
EV/Revenue exit multiple.

46
SOFTWARE M&A: BY VERTICAL AND HORIZONTAL MARKETS

Horizontal & Vertical M&A Volume
100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
Horizontal & Vertical M&A Median EV/Revenue Exit Multiples
2.5x
2.5x
2.4x
65%
69%
66%
67%
2.4x
2.4x
2.4x
2.3x
65%
2.3x
2.3x
2.1x
35%
31%
34%
33%
35%
2Q14
3Q14
4Q14
1Q15
2Q15
Horizontal
2Q14
3Q14
Vertical
4Q14
Vertical
1Q15
2Q15
Horizontal
The median exit multiple of horizontal software companies was 2.3x TTM revenue in 2Q15, virtually unchanged from the prior four quarters. Notable Q2
horizontal transactions included Comverses acquisition of enterprise messaging and communications software provider Acision for $402.2 million (2.1x
EV/Revenue) and Francisco Partners Managements acquisition of workforce management software provider ClickSoftware Technologies for $375.6
million (3.0x EV/Revenue).
The median exit multiple of vertical software companies was 2.5x TTM revenue in 2Q15, slightly higher than the prior quarter. Vertical software targets
have fetched a higher median EV/Revenue exit multiple than their horizontal software counterparts for the past three quarters. That represents a marked
turnaround for vertical software median exit multiples after a dismal 2012 and 2013 (1.5x). The vertical exit recovery began in 2014 when the median
multiple advanced to 2.2x.
Q2s more noteworthy vertical software deals included Zoopla Property Groups acquisition of energy software provider Ulysses Enterprises for $292.0
million (3.0x EV/Revenue) and Autobytels acquisition of automotive software provider Dealix Corporation And Autotegrity for $25.0 million.

47
SOFTWARE M&A ACTIVITY BY PRODUCT CATEGORY
Mobile was the most active product category by

far in the second quarter, accounting for 20.1%
of all software M&A transactions.
Distant
runner-ups were Financial Services (6.0%),
Security (4.1%), Multimedia, Graphics &
Communications (4.3%), and BI, Risk &
Compliance (4.3%).
Historically, deal activity in any given product

category varies widely from year to year, based
upon evolving market adoption, changing
technology platforms, economic cycles, etc.
Examples include:
Public Sector transactions accounted for

3.6% of all software M&A activity in 2Q15,
but only 1.6% in 2Q14.
Education deals represented only 1.9% of all

software M&A activity in 2Q15, compared
with 4.0% in 2Q14.
Multimedia, Graphics & Communications

transactions were credited with 4.3% of
software M&A activity in 2Q15, compared
with 2.8% in 2Q14.
CRM, Marketing, & Sales accounted for 3.1%

of all software M&A activity in 2Q15,
compared with 5.4% in 2Q14.

48
SOFTWARE M&A EXIT MULTIPLES BY PRODUCT CATEGORY

Median EV/Revenue Exit Multiples by Software Product Category
4.1x
2.8x
2.6x
2.5x
2.3x
2.1x
2.1x
1.9x
1.9x
CRM & Marketing
Security
Multimedia,
Graphics & Digital
Media
Supply Chain Mgmt

& Logistics
Other Verticals
(A&D, Telco, Retail,
etc.)
BI, Risk &

Compliance
Mobile
Content, Document
& BPM
Healthcare
Financial Services
1.1x
Among the 34 on-premise software product categories we track, ten had both sufficient deal activity and deal data to ascertain a category TTM revenue
multiple in 2Q15.
On a TTM basis, the Financial Services category was rewarded with the highest median exit multiple (4.1x) in Q2, followed by Healthcare with a median
exit multiple of 2.8x.
Notable Financial Services software transactions included BridgePoint Advisors acquisition of eFront (4.1x EV/Revenue) and First Derivatives acquisition
of ActivateClients (6.5x EV/Revenue).
First quarter Healthcare software transactions included Sy.Med Developments acquisition of HealthLine Systems (4.7x EV/Revenue) and Maquets
acquisition of Cetrea A/S (3.7x EV/Revenue).
On-premise CRM & Marketing exit multiples lagged far behind most others, with most M&A dollars in this product category going to SaaS/hosted solution
providers.
49
SaaS M&A: DEAL VOLUME AND MEDIAN EXIT MULTIPLES

SaaS M&A Volume
SaaS as % of Software
160
150
# of SaaS M&A Deals
140
132 134
120
104
94
100
80
60
94
97
108
103 104
118
30%
25%
20%
86
15%
59
10%
40
20
0
5%
0%
SaaS M&A Deals as a % of Total Software

M&A Deals
SaaS M&A Deals
Median SaaS EV/Revenue Exit Multiples
4.0x
4.1x
2Q14
3Q14
3.7x
3.4x
3.7x
4Q14
1Q15
2Q15
There were 150 SaaS M&A transactions in 2Q15, the most on record for any quarter, and approximately 154% greater than three years ago.
The median TTM EV/Revenue exit multiple of SaaS transactions was 3.7x in 2Q15, a modest uptick from the prior quarter. The median SaaS exit multiple
has been slightly depressed over the past three quarters as the number of SaaS targets has substantially increased. There are many reasons for the decline
over the past several years in SaaS median exit multiples, including a growing number of smaller, slower growing SaaS providers being acquired; a greater
number of acquisitions by tighter fisted private equity buyers.(Insight Ventures acquisition of E2Open for 3.2x TTM revenue, and The Carlyle Groups
acquisition of Dealogic for 3.6x TTM revenue); and a growing number of SaaS acquisitions by non-traditional buyers who tend to pay less, such as digital
and audio equipment manufacturer, Harman International, and business process services provider, Maximus.
That said, a number of SaaS sellers in Q2 fetched exit multiples well above the median, including Virtustream, purchased by EMC for $1.2 billion (~10.0x
revenue); Applied Predictive Technologies, acquired by Mastercard for $600 million (~6.0x revenue); TellApart, purchased by Twitter for $533 million
(~6.0x revenue); and DealerTrack, acquired by Cox Automotive for $4.5 billion (4.7x revenue).
The median SaaS exit multiple was 48% greater than the median on-premise software exit multiple in 2Q15 (3.4x vs 2.5x).
50
SaaS M&A BY PRODUCT CATEGORY 2Q15
Education and CRM, Marketing & Sales were

the most active SaaS M&A product categories,
accounting for 12.7% and 8.7%, respectively,
of all SaaS M&A transactions in the second
quarter.
While the CRM, Marketing and Sales category

usually accounts for a high percentage of
quarterly SaaS transaction activity, Education
was a surprise. The category was largely
driven by nearly one dozen higher education
SaaS acquisitions in the second quarter.
Messaging, Conferencing, & Communications

and Security product categories also
exhibited strength in 2Q15, accounting for
5.3% and 7.3%, respectively, of total SaaS
deal volume for the quarter.
Other notable categories included BI, Risk &

Compliance (5.3%), HR & Workforce
Management (4.7%), Healthcare (4.7%), and
Multimedia, Graphics & Communications
(4.7%).

51
2Q15 SaaS M&A TRANSACTIONS

Date
6/30/2015
6/29/2015
6/29/2015
6/29/2015
6/29/2015
6/28/2015
6/26/2015
6/25/2015
6/25/2015
6/25/2015
6/25/2015
6/24/2015
6/24/2015
6/24/2015
6/23/2015
6/24/2015
6/23/2015
6/23/2015
6/23/2015
6/22/2015
6/19/2015
6/19/2015
6/19/2015
6/17/2015
6/17/2015
6/17/2015
6/16/2015
6/16/2015
6/15/2015
6/15/2015
6/15/2015
6/15/2015
6/15/2015
6/12/2015
6/11/2015
6/11/2015
6/10/2015
6/10/2015
Buyer
SendGrid, Inc.
Sprinklr Inc.
Frontline Technologies Group LLC
Safari Books Online, LLC
NetSuite Inc. (NYSE:N)
Schulman Associates IRB, Inc.
ToxPlanet
Gravity4, Inc.
CoCubes Technologies Pvt. Ltd.
Changepoint Corporation
Cisco Systems, Inc. (NasdaqGS:CSCO)
Pantheon Systems, Inc.
Hubei Landing Holding Co., Ltd. (SZSE:000971)
AppFolio, Inc. (NasdaqGM:APPF)
AvidXchange, Inc.
CA, Inc. (NasdaqGS:CA)
Online Learning
Mobio Technologies Inc. (TSXV:MBO)
Optimal Payments Plc (AIM:OPAY)
STAUFENBIEL Institut GMBH
Brand Networks, LLC
mercator
Serent Capital
Pitney Bowes International Holdings, Inc.
XIFIN, Inc.
Kronos Incorporated
Permira Advisers Ltd.; Canada Pension Plan Investment Board
MarketShare Partners LLC
Scribble Technologies Inc.
Intercity Networks Limited
SiteMinder Pty Ltd.
Patriot Technology Solutions, Inc.
Batia Infotech
InsideSales.com, Inc.
Pearson VUE, Inc.
Zuora, Inc.
ArisGlobal LLC
Seller
Mail Bypass, Inc.
Get Satisfaction, Inc.
My Learning Plan Inc.
popforms, inc.
Bronto Software, Inc.
Absolute Research, LLC
Expert Publishing, LLC
TradeDoubler AB (OM:TRAD)
VCS Tech Solutions Pvt. Ltd.
Barometer, Inc.
Tropo Inc.
Gorton Studios, Inc., NodeSquirrel
Jilin Gosun Technology Co.,Ltd.
RentLinx, LLC.
Strongroom Solutions, Inc.
Rally Software Development Corp.
MERLOT, The Journal of Online Learning and Teaching
20 Year Media Corp.
FANS Entertainment Inc.
GradeView UG (haftungsbeschrnkt)
Shift Labs, Inc.
Catapult, a Mercator company
Mercury Network, LLC
Borderfree, Inc.
VisualShare, Inc.
Productive Scheduling Solutions, LLC
Informatica Corporation (NasdaqGS:INFA)
Business Researchers, Inc.
Appinions Inc.
DecisionsDecisions Ltd.
Gage Networks LLP
Globekey Systems Pty Ltd
InsureLinx, Inc.
HelpIQ
Cloud9 Analytics, Inc.
ProctorCam, Inc.
Frontleaf, Inc.
Medsight Solutions, LLC

Enterprise
Value (mm)
$200.00
$53.30
$242.03
$432.40
$2.08
$12.80
$50.00
$372.04
$4,844.37
$6.00
-
TTM
Revenue
(mm)
$199.33
$92.52
$123.76
$1,055.39
-
EV/Rev
0.26x
4.67x
3.01x
4.59x
-
52
2Q15 SaaS M&A TRANSACTIONS (CONT)

Date
6/10/2015
6/11/2015
6/10/2015
6/9/2015
6/9/2015
6/8/2015
6/5/2015
6/5/2015
6/3/2015
6/3/2015
6/4/2015
6/3/2015
6/3/2015
6/2/2015
6/2/2015
6/1/2015
6/2/2015
6/1/2015
6/1/2015
6/11/2015
6/2/2015
5/31/2015
6/24/2015
5/30/2015
5/29/2015
5/28/2015
6/2/2015
5/28/2015
5/28/2015
5/27/2015
5/27/2015
5/26/2015
5/26/2015
5/22/2015
5/21/2015
5/21/2015
5/20/2015
5/19/2015
5/19/2015
Buyer
Baidu, Inc. (NasdaqGS:BIDU)
Ackroo Inc. (TSXV:AKR)
Satellite Logistics Group, Inc.
BlackBerry Limited (TSX:BB)
Hello Curry Pvt Ltd.
eVestment Alliance, LLC
Viewpoint, Inc.
Automattic Inc.
ProQuest LLC
GameFly, Inc.
Marlin Equity Partners, LLC
H.I.G. Capital, LLC
Insight Venture Partners
SkillSoft France SARL
Palo Alto Networks, Inc. (NYSE:PANW)
ACS Technologies Group, Inc.
IID, Inc. (TSE:6038)
Akamai Technologies, Inc. (NasdaqGS:AKAM)
EMC Corporation (NYSE:EMC)
Ernst & Young Global Limited
Ornico Group (Pty) Ltd.
Accenture plc (NYSE:ACN)
Francisco Partners Management LLC
Avaya Inc.
Hortonworks, Inc. (NasdaqGS:HDP)
Perfect Commerce Holdings, LLC
QUADROtech Solutions AG
StudyPortals B.V.
Orange Business Services
DMM.com Corporation
Vertafore, Inc.
Vista Equity Partners
Marketing Associates, LLC
Basware UK Ltd.
Adobe Systems Incorporated (NasdaqGS:ADBE)
Proxio, Inc.
Charter Pacific Corp. Ltd. (ASX:CHF)
LenderLive Network, Inc.
Overture Technologies, Inc.
Seller
Xingyun Rongchuang (Beijing) Technology Co. Ltd.
Dealer Rewards Of Canada 2014 Inc.
Have AnotherRound Apps, L.L.C.
WatchDox, Inc.
Acharis IT Consultancy Private Limited, Fire42
TopQ Software Ltd
Jobpac International Systems Pty Ltd.
Bubblestorm Management (Proprietary) Limited
SIPX, Inc.
Playcast Media Systems Ltd.
General Dynamics Fidelis Cybersecurity Solutions Inc.
Inome, Inc.
Fourth Ltd.
Vodeclic SAS
ShieldArc Inc.
Mersoft Corporation, Solomon Learning Management System
Mynavi Corporation
Octoshape ApS
Virtustream, Inc.
Entegreat, Inc
Fuseware (Pty) Ltd.
T'quila Limited
HealthcareSource HR, Inc.
Esna Technologies Inc.
SequenceIQ Inc.
Hubwoo (ENXTPA:HBW)
Timefinity Group Limited
Web2Present SL
Gemalto NV, SafeNet Authentication Service
Cerego Japan, Inc., iKnow
QQ Solutions, Inc.
Pearson Education, Inc., Student Information Systems Businesses
Conclusive Analytics, Inc.
ProcServe Holdings Limited
Mixamo, Inc.
PCMS Consulting, Inc.
Accloud Limited
Walz Group, LLC
AlumniFidelity, Inc.

Enterprise
Value (mm)
$1.48
$30.00
$18.00
$1,200.00
$35.84
$21.89
$350.00
$27.97
-
TTM
Revenue
(mm)
$36.85
$33.26
$10.00
$10.37
-
EV/Rev
0.71x
2.70x
-
53

Date
Buyer
5/19/2015 Google Inc. (NasdaqGS:GOOGL)
Ausstellungs- und Messe GmbH des Brsenvereins des Deutschen
5/19/2015
Buchhandels
5/19/2015 salesforce.com, inc. (NYSE:CRM)
5/19/2015 Sovos Compliance, LLC
5/15/2015 Twitter, Inc. (NYSE:TWTR)
5/19/2015 Zomato Media Pvt. Ltd.
5/14/2015 American Green, Inc. (OTCPK:ERBB)
5/14/2015 XSEED Education Pte. Ltd.
5/13/2015 HighJump Software
5/13/2015 Archway Marketing Services, Inc.
5/12/2015 5/12/2015 EMC Corporation (NYSE:EMC)
5/12/2015 ITM|TwentyFirst LLC
5/12/2015 MasterCard Incorporated (NYSE:MA)
5/11/2015 Gravity4, Inc.
5/8/2015 BookingSuite (USA) Inc.
5/7/2015 Jive Communications, Inc.
5/7/2015 Rapid7, Inc.
5/7/2015 HDS International Corp. (OTCPK:HDSI)
5/7/2015 Neopost S.A. (ENXTPA:NEO)
5/6/2015 EMS Find, Inc. (OTCPK:EMSF)
5/6/2015 Buchzentrum AG
5/5/2015 Visma AS
5/4/2015 Cisco Systems, Inc. (NasdaqGS:CSCO)
5/4/2015 Aptean, Inc.
5/4/2015 Capillary Technologies Pvt Ltd.
4/30/2015 Beyondsoft Investment
5/8/2015 Synchronous Technologies, Inc.
4/30/2015 EDPlus Holdings, LLC
4/30/2015 RingCentral, Inc. (NYSE:RNG)
4/29/2015 Valore
4/30/2015 8x8 Inc. (NasdaqGS:EGHT)
4/29/2015 Dartican LLC
4/26/2015 InfoFort
4/30/2015 Access Intelligence plc (AIM:ACC)
4/24/2015 Source Medical Solutions, Inc.
5/25/2015 Avaya Inc.
4/24/2015 Accela, Inc.
Seller
Agawi Inc.
IPR License, Ltd.
Toopher Inc.
Six88 Solutions, Inc.
TellApart, Inc.
Zomato Base
TrackX, LLC
Pleolabs Technology Private Limited
Nexternal Solutions, Inc.
PogMaker Corp
Brivo Systems, LLC
CloudLink Technologies Inc.
Insurance Trust Monitor, Inc. and InsuranceIQ
Applied Predictive Technologies, Inc.
CrossGraph
PriceMatch SAS
Speek Inc.
NT OBJECTives, Inc.
SirenGPS Inc, Emergency Management Software
Temando Pty Ltd
Page-Out,LLC
bpm consult ag
e-conomic international a/s, Core Scandinavian Business
Piston Cloud Computing, Inc.
Cinram Group, Inc., Vision Software Solutions
MartJack
soften.cn
CoolerEmail, Inc. and CoolerWeb, Inc.
PrepTalk, Inc.
Glip, Inc.
Boundless Learning, Inc.
Quality Software Corporation
KnowledgePay, Inc.
CBKSoft Software Inc.
Cision UK Limited And Vocus UK Ltd.
LaClaro, Inc.
KnoahSoft, Inc.
SoftRight, LLC and Springbrook Software, Inc.

Enterprise
Value (mm)
-
TTM
Revenue
(mm)
-
EV/Rev
-
$533.00
$50.00
$600.00
$6.50
$225.81
$8.05
$4.30
$16.55
$2.05
-
$1.00
-
54

Enterprise
Value (mm)
-
TTM
Revenue
(mm)
-
EV/Rev
-
Date
Buyer
4/23/2015 LULU SOFTWARE, Inc.
Seller
Online PDF Services O
4/23/2015 Terragon Limited
Bizense Pte. Ltd.
4/22/2015 Ernst & Young Australia
ISD Analytics
4/22/2015 NZX Limited (NZSE:NZX)
Apteryx, Inc.
$1.02
$0.82
1.25x
4/22/2015 Mitek Systems, Inc. (NasdaqCM:MITK)
ID Checker.NL B.V.
$10.60
4/22/2015 Aurea Software
Lyris, Inc.
$15.56
$28.42
0.55x
4/21/2015 Free Stream Media Corp.
Filmaster Sp. z o.o.
$1.12
4/20/2015 Accusoft Corporation
Vuzit, LLC
4/20/2015 Ooyala, Inc.
Nativ Limited
4/18/2015 Blackfin Capital Partners SAS
AM Fine Services & Software SAS
4/16/2015 ESI Group SA (ENXTPA:ESI)
Ciespace Corporation
4/16/2015 Interactive Brokers Group, Inc. (NasdaqGS:IBKR)
Covestor, Inc.
4/17/2015 RealPage, Inc. (NasdaqGS:RP)
Indatus ICIM Corp., Select Assets
$49.00
4/16/2015 AppDynamics, Inc.
BugBuster SA
4/15/2015 Hewlett-Packard Company (NYSE:HPQ)
ConteXtream, Inc.
4/15/2015 Greater Intell Inc.
Stella Now Limited
4/14/2015 Market Tech Holdings Limited (AIM:MKT)
Stucco Media Limited
$42.86
$6.10
7.03x
4/14/2015 CCC Information Services Inc.
DriveFactor Inc.
$22.00
4/13/2015 Singapore Telecommunications Limited (SGX:Z74)
TrustWave Holdings, Inc.
$826.53
$216.00
3.83x
$135.00
4/9/2015
Charter Communications, Inc. (NasdaqGS:CHTR); ARRIS Group, Inc.

(NasdaqGS:ARRS)
ActiveVideo Networks, Inc.
4/8/2015
Market Track, LLC
New Momentum, Inc.
4/8/2015
Vert Capital Corporation
Asahi Net International, Inc.
4/8/2015
International Business Machines Corporation (NYSE:IBM)
Explorys, Inc.
4/8/2015
Cox Automotive, Inc.
Dealertrack Technologies, Inc. (NasdaqGS:TRAK)
$4,459.51
$948.36
4.70x
4/7/2015
eCommerce Industries, Inc.
Naverisk Ltd.
4/7/2015
Carl Capital Corp.
FlowWorks, Inc.
$0.83
4/8/2015
Towers Watson & Co. (NasdaqGS:TW)
Saville Consulting Group Ltd
$63.94
4/7/2015
Box, Inc. (NYSE:BOX)
Verold Inc.
4/6/2015
The Learning House, Inc.
Acatar LLC
4/3/2015
mClinica Pte. Ltd.
Medix
4/7/2015
Unit4 N.V.
Three Rivers Systems, Inc.
4/2/2015
Driftt, Inc.
Fetchnotes, Inc.
4/1/2015
Tune, Inc.
Appfuel
4/1/2015
Sony Computer Entertainment Inc.
OL2, Inc.
4/1/2015
mGage LLC
Unicel Technologies Pvt. Ltd.
$15.64

55
INTERNET M&A: DEAL VOLUME AND EXIT MULTIPLES

Internet M&A Volume
Median Internet EV/Revenue Exit Multiples
350
304
300
250
241
244
244
215
200
1.7x
150
2.1x
2.0x
3Q14
4Q14
2.9x
2.9x
1Q15
2Q15
100
50
0
2Q14
3Q14
4Q14
1Q15
2Q15
2Q14
After holding steady for the past three quarters, Internet M&A deal volume rose sharply in 2Q15.
Q2s 304 Internet M&A transactions represented a 41% YoY gain (215 in 2Q14 vs 304 in 2Q15).
The 2.9x median TTM EV/Revenue exit multiple for Internet sellers in 2Q15 equaled 1Q15s mark, a breathtaking benchmark compared to historical
norms.
Recent leading second quarter Internet M&A transactions included Hotspring Ventures acquisition of Treatwell Holding ($38 million, 141.7x
EV/Revenue) in 2Q15 and Equinixs acquisition of Telecity Group ($4.1 billion, 7.6x EV/Revenue) in 2Q15.

56
INTERNET M&A: BY PRODUCT CATEGORY

2Q15 M&A Volume by Product Category
M&A Volume by Quarter
7.6%
9.2%
28.6%
3.6%
Ad-Tech & Lead Gen

Commerce
Content & Media
Gaming
Infrastructure
Category
Ad-Tech & Lead Gen
Commerce
Content & Media
Gaming
Infrastructure
Social Tech
Total
2Q 2014 3Q 2014 4Q 2014

68
73
67
41
49
65
41
43
52
16
21
13
25
32
32
24
23
15
215
241
244
1Q15
73
50
60
10
32
19
244
2Q15
87
74
81
11
28
23
304
Social Tech
26.6%
24.3%
With the exception of Internet Infrastructure, all internet M&A categories experienced higher deal volume in 2Q15 over 1Q15.
Three categories posted exceptional deal activity, accounting for most of Q2s uptick in deal volume. The Ad-Tech and Lead Gen category racked up 87
deals in 2Q15, a 19% increase over 1Q15 and 28% YoY increase; Content & Median posted 81 deals in 2Q15, a 35% increase over 1Q15 and ~100% YoY
increase); and Commerce saw 74 deals in 2Q15, a 48% increase over 1Q15 and 81% YoY increase.
Infrastructures 28 transactions, and Social Techs 23 transactions in 2Q15, were both in line with historical norms.
Gaming once again had the lowest transaction volume.

57
APPENDIX

THE SEG SOFTWARE INDEX COMPANIES KEY METRICS

SEG Software Index
Company
EV/Revenue
EV/EBITDA
TTM Revenue Growth
2Q14
3Q14
4Q14
1Q15
2Q15
2Q14
3Q14
4Q14
1Q15
2Q15
2Q14
3Q14
4Q14
1Q15
A10 Networks
Accretive Health
ACI Worldwide
Activision Blizzard
Advent Software
Allot Communications
Allscripts Healthcare Solutions
Amdocs Limited
American Software
ANSYS
Aspen Technology
Autodesk
AVG Technologies
Bango PLC
Barracuda Networks
Blackbaud
Bottomline Technologies
Broadridge Financial
Brocade Communications Systems
4.0x
0.3x
2.9x
3.4x
3.1x
1.8x
2.2x
7.3x
10.1x
4.3x
2.8x
7.4x
6.8x
3.1x
4.5x
1.9x
2.0x
3.2x
0.3x
2.8x
2.4x
1.8x
2.0x
6.8x
9.6x
4.2x
2.6x
6.8x
5.2x
3.1x
3.5x
1.9x
1.6x
0.8x
0.4x
3.4x
2.2x
2.3x
1.8x
1.9x
6.9x
8.8x
4.6x
2.3x
9.1x
4.8x
3.2x
3.1x
2.0x
1.6x
1.0x
3.0x
1.8x
2.1x
1.7x
2.0x
7.0x
7.3x
4.9x
2.5x
11.6x
5.9x
3.6x
2.9x
2.2x
1.9x
1.4x
0.4x
3.5x
3.8x
1.2x
2.2x
2.0x
2.1x
7.7x
8.1x
4.6x
3.6x
9.2x
6.8x
4.6x
3.1x
2.5x
2.1x
4.7x
12.9x
11.5x
552.2x
9.8x
13.8x
15.7x
34.1x
25.1x
7.9x
454.1x
16.0x
41.4x
9.7x
7.7x
4.8x
12.9x
104.4x
10.0x
12.6x
14.7x
28.4x
27.2x
7.8x
162.7x
15.9x
31.6x
9.6x
5.9x
6.2x
11.7x
80.6x
56.3x
9.3x
15.7x
15.0x
22.6x
36.0x
7.2x
140.6x
19.5x
24.3x
10.1x
6.2x
14.6x
68.1x
50.0x
9.1x
17.8x
15.1x
18.6x
45.4x
7.8x
209.0x
22.0x
22.6x
10.9x
7.3x
7.1x
16.9x
12.6x
33.8x
47.3x
10.3x
17.9x
16.7x
20.0x
47.3x
11.5x
308.2x
28.2x
23.3x
12.7x
8.0x
BSQUARE
0.2x
0.2x
0.2x
0.2x
0.4x
65.0x
5.7x
7.3x
7.4x
-2.8%
CA Technologies
Cadence Design Systems
Cerner
Check Point Software Tech
Cisco Systems
Citrix Systems
ClickSoftware Technologies Ltd
CommVault Systems
Computer Programs and Sys
Constellation
CSG Systems International
Cyan
Cyberark Software
Cyren
Dassault Systmes
DST Systems
Electronic Arts
3.0x
2.8x
6.4x
8.4x
1.9x
3.3x
4.9x
3.5x
4.0x
1.3x
1.3x
2.9x
4.4x
1.8x
2.1x
2.6x
2.8x
5.4x
7.9x
2.0x
3.2x
3.4x
3.3x
3.5x
1.3x
1.4x
2.6x
4.7x
1.6x
2.3x
2.6x
3.1x
5.8x
7.9x
2.1x
3.8x
3.2x
3.3x
3.3x
1.3x
1.4x
8.2x
2.4x
5.5x
1.5x
2.2x
2.8x
3.2x
6.2x
8.9x
2.2x
3.5x
2.9x
3.2x
3.8x
1.3x
1.0x
9.7x
1.6x
5.3x
1.5x
2.5x
2.9x
3.3x
6.7x
9.3x
2.3x
3.5x
2.7x
2.9x
5.2x
1.5x
1.7x
14.9x
2.9x
6.9x
1.7x
3.8x
9.2x
14.2x
24.2x
15.3x
6.8x
14.7x
26.9x
12.7x
29.9x
7.8x
16.2x
11.2x
30.9x
8.2x
14.0x
20.6x
14.4x
7.4x
13.3x
19.8x
11.9x
35.8x
7.9x
17.9x
10.1x
24.4x
8.4x
15.7x
21.9x
14.5x
7.5x
17.6x
28.0x
12.6x
22.9x
8.5x
39.6x
22.1x
9.8x
8.8x
8.9x
15.3x
21.2x
16.4x
7.4x
16.4x
25.2x
12.3x
25.7x
8.1x
47.0x
21.1x
9.8x
10.0x
9.1x
15.5x
23.4x
17.1x
8.4x
16.3x
31.6x
11.6x
32.3x
9.4x
62.0x
27.1x
10.9x
14.9x
-2.0%
-1.6%
-0.4%
-0.4%
8.8%
7.4%
7.4%
8.3%
11.1% 15.2% 15.2% 16.6%
4.5%
5.3%
7.3%
7.3%
-1.4%
-3.0%
-3.1%
0.4%
12.2%
9.4%
7.7%
7.7%
-10.2% -8.5%
1.7%
1.7%
18.2% 16.5%
8.1%
8.1%
8.0%
3.7%
1.9%
1.9%
41.7% 40.8% 37.9% 37.9%
0.3%
-0.2%
0.5%
0.5%
1.2% -12.5% -13.8% -13.8%
55.7% 55.7%
25.0% 15.2% -1.0%
-1.0%
1.6%
2.3%
11.0% 11.0%
2.1%
2.0%
3.4%
3.4%
-5.8%
1.3%
21.6% 21.6%
EBITDA Margin
2Q15
2Q14
3Q14
4Q14
1Q15
2Q15
26.6% 26.6% 12.6% -1.0%

-1.7% -12.8% -12.8% -18.8%
-2.1%
-3.1%
0.5%
0.5%
5.8%
6.7%
6.6%
6.3%
6.3%
6.1%
33.8% 30.3% 17.5% 17.5% 11.2% 22.2% 21.6% 20.5% 20.5% 20.5%
-12.7% -13.9% -3.8%
-3.8%
4.7%
29.5% 27.2% 28.9% 28.9% 30.4%
6.3%
5.6%
3.6%
3.6%
4.1%
18.6% 24.1% 25.9% 25.9% 26.2%
-3.8%
8.3%
21.4% 21.4% 17.6%
0.6%
3.4%
2.7%
2.7%
3.5%
-4.4%
-2.2%
0.4%
0.4%
0.4%
1.4%
2.3%
4.1%
4.1%
4.6%
4.8%
5.6%
6.6%
6.6%
4.8%
18.4% 18.3% 18.9% 18.9% 19.4%
0.1%
4.4%
1.3%
1.3%
2.3%
16.2% 15.9% 12.3% 11.1% 11.5%
8.4%
8.0%
8.7%
8.7%
6.8%
46.8% 46.5% 46.0% 46.0% 46.0%
27.7% 25.7% 20.4% 20.4% 14.6% 29.7% 34.0% 38.9% 38.9% 40.7%
0.1%
3.7%
6.1%
10.5% 11.8% 17.1% 15.3% 12.8% 10.7%
9.7%
4.8%
-3.0%
-8.1%
-8.1%
-3.2% 35.0% 33.6% 32.4% 32.4% 31.0%
-16.5% -19.5% -42.0% -42.0% -42.0% -60.4% -71.1% -95.7% -95.7% -95.7%
16.5% 16.8% 17.6% 18.7% 18.7%
1.5%
3.2%
3.4%
2.8%
2.2%
10.1%
9.5%
12.0% 12.0% 13.2% 19.5% 19.6% 16.5% 16.5% 16.2%
13.1% 18.0% 19.8% 19.8% 15.2% 10.9% 11.1% 12.6% 12.6% 13.5%
7.2%
5.2%
4.6%
4.6%
4.5%
19.7% 20.4% 19.9% 19.9% 20.0%
-2.8%
-1.6%
-0.5%
1.1%
1.6%
25.5% 26.2% 25.8% 25.6% 26.0%
1.2%
4.1%

4.1%
5.8%
-1.3%
-3.4%
8.7%
20.0%
8.0%
3.1%
5.2%
6.2%
3.6%
-2.2%
25.8%
-0.8%
7.5%
67.4%
-4.9%
17.3%
4.1%
26.3%
32.2% 31.7% 31.1% 31.1% 32.3%

19.9% 19.9% 19.9% 20.9% 21.4%
26.3% 26.5% 26.5% 29.0% 28.4%
55.1% 54.7% 54.3% 54.3% 54.0%
27.8% 27.3% 27.5% 29.1% 27.7%
22.7% 23.8% 21.4% 21.4% 21.4%
13.8% 13.1% 15.9% 15.9% 14.3%
18.2% 17.1% 11.5% 11.5%
8.4%
27.3% 27.9% 26.0% 26.0% 24.7%
13.5%
9.9%
14.6% 14.6% 16.1%
16.2% 16.0% 15.7% 15.7% 16.3%
-41.2% -49.9% -49.3% -49.3% -35.8%
13.2% 12.6% 20.6% 20.6% 24.1%
-10.6% -13.7% -13.3% -13.3% -12.5%
27.4% 26.3% 25.1% 25.1% 25.4%
15.7% 15.5% 15.5% 15.5% 15.7%
6.9%
9.5%
24.9% 24.9% 25.2%
0.3%
3.3%
3.3%
5.2%
59

SEG Software Index
Company
EMC
EPIQ Systems
Evertec
Evolving Systems
F5 Networks
Fair Isaac
FalconStor Software
Fidessa
Fiserv
Fortinet
GameLoft SA
Gigamon
Glu Mobile
Gree
GSE Systems
Guidance Software
Guidewire Software
Hewlett Packard
IBM
iDream Sky Technologies
Imperva
Informatica
Intuit
Jack Henry & Associates
Juniper Networks
King Digital Entertainment
Konami
Magic Software Enterprises
Manhattan Associates
MedAssets
Mentor Graphics
Merge Healthcare
Microsoft
MicroStrategy
Millennial Media
MIND C.T.I.
MobileIron
EV/Revenue
EV/EBITDA
TTM Revenue Growth
EBITDA Margin
2Q14
2.3x
1.7x
7.4x
3.7x
4.8x
3.2x
1.0x
3.2x
3.7x
4.9x
2.5x
5.9x
2.8x
1.6x
0.3x
2.6x
9.1x
0.6x
2.4x
9.8x
3.8x
4.9x
4.1x
3Q14
2.2x
1.6x
7.1x
3.0x
4.5x
3.1x
1.0x
2.9x
3.7x
4.5x
2.2x
2.7x
2.1x
1.4x
0.3x
2.3x
6.3x
0.6x
2.3x
3.3x
3.3x
4.5x
4.1x
4Q14
2.4x
1.8x
6.8x
3.4x
4.5x
2.9x
0.9x
3.0x
3.8x
4.7x
1.8x
1.4x
2.0x
1.6x
0.3x
1.9x
7.0x
0.7x
2.5x
5.2x
3.9x
2.8x
4.8x
4.0x
1Q15
2.4x
2.0x
6.6x
3.6x
4.9x
3.4x
0.7x
3.1x
4.0x
4.9x
1.3x
2.0x
1.7x
1.3x
0.2x
1.5x
8.1x
0.7x
2.1x
4.1x
6.3x
3.2x
5.4x
4.1x
2Q15
2.1x
2.1x
6.5x
3.1x
4.5x
4.1x
0.9x
2.8x
4.4x
7.1x
1.3x
4.9x
2.9x
1.1x
0.3x
1.7x
8.2x
0.6x
2.2x
1.4x
8.4x
4.3x
6.2x
4.3x
2Q14
9.8x
11.2x
19.2x
17.3x
15.8x
12.0x
16.9x
12.7x
38.1x
18.6x
4.7x
113.6x
5.6x
8.9x
21.0x
14.4x
12.8x
3Q14
9.7x
12.2x
17.7x
12.3x
14.7x
11.8x
15.5x
12.7x
35.8x
19.9x
4.3x
92.9x
5.5x
8.9x
18.0x
13.7x
12.2x
4Q14
10.1x
15.5x
16.3x
11.1x
14.4x
12.6x
16.6x
12.8x
43.8x
35.6x
29.7x
5.0x
77.2x
5.6x
9.3x
299.0x
15.1x
15.0x
11.8x
1Q15
10.0x
16.7x
15.7x
11.8x
15.6x
14.7x
16.9x
13.6x
46.5x
25.0x
25.5x
4.0x
93.6x
5.7x
8.1x
237.7x
16.9x
17.5x
12.0x
2Q15
9.3x
16.2x
15.5x
10.1x
14.3x
18.3x
128.8x
15.5x
14.6x
79.2x
26.4x
43.2x
3.5x
121.3x
5.1x
8.3x
74.3x
23.8x
25.1x
12.6x
2Q14
5.9%
23.9%
3.3%
-7.4%
11.3%
3.9%
-22.4%
0.1%
9.0%
17.4%
8.7%
38.2%
18.2%
-12.4%
-14.3%
-16.4%
21.2%
-3.2%
-5.9%
26.4%
17.7%
15.1%
3.3%
3Q14
5.7%
21.7%
2.5%
3.9%
14.7%
2.5%
-23.5%
0.1%
7.6%
20.0%
5.7%
15.4%
40.0%
-17.5%
-16.2%
-14.1%
16.5%
-0.8%
-3.3%
25.2%
16.6%
8.0%
5.9%
4Q14
5.2%
1.2%
0.9%
18.3%
17.5%
7.6%
-21.1%
-1.4%
5.2%
25.2%
-2.6%
12.0%
111.3%
-25.0%
-20.3%
-1.7%
19.6%
-0.8%
-5.7%
299.1%
19.1%
10.5%
7.7%
8.4%
1Q15
2Q15
2Q14
3Q14
4Q14
1Q15
2Q15
5.2%
5.4%
23.7% 23.1% 23.9% 23.9% 22.9%
1.2%
-3.6% 15.1% 13.2% 11.8% 11.8% 12.9%
0.9%
1.9%
38.5% 40.2% 41.9% 41.9% 42.1%
18.3% 19.0% 21.4% 24.6% 30.4% 30.4% 31.1%
17.5% 15.6% 30.7% 30.8% 31.1% 31.1% 31.6%
7.6%
9.7%
26.4% 26.0% 23.3% 23.3% 22.3%
-21.1% -2.1% -10.7% -9.2% -18.0% -18.0% 0.7%
-1.4%
-1.4% 19.1% 18.8% 18.2% 18.2% 18.2%
5.2%
4.3%
29.1% 29.3% 29.7% 29.7% 30.3%
25.2% 25.6% 13.0% 12.5% 10.6% 10.6%
9.0%
-2.6%
-2.6% 13.4% 11.3%
5.1%
5.1%
5.1%
17.8% 17.8% -25.8% -11.4% -9.3%
-1.6%
-1.6%
111.3% 97.5% -6.0%
-2.4%
6.6%
6.6%
6.7%
-25.0% -27.9% 34.2% 33.5% 31.4% 31.4% 30.3%
-20.3% -1.6%
-8.9% -10.4% -12.3% -12.3% -7.3%
-1.7%
-0.6% -11.1% -8.3%
-5.3%
-5.3%
-4.3%
17.2% 13.3%
8.0%
6.8%
9.1%
8.7%
6.8%
-1.7% -3.2% 11.5% 11.5% 11.8% 11.9% 12.0%
-5.7%
-7.3% 26.8% 25.6% 26.3% 26.3% 26.2%
299.1% 196.5% 20.8% 20.8%
1.7%
1.7%
1.9%
19.1% 26.0% -23.6% -28.8% -32.3% -32.3% -31.4%
10.5%
8.0%
17.9% 18.3% 18.7% 18.7% 18.1%
11.0% -0.9% 33.9% 33.0% 31.8% 30.6% 24.7%
8.4%
9.1%
32.3% 33.5% 33.7% 33.7% 34.4%
2.4x
2.6x
1.5x
2.2x
6.0x
3.4x
2.1x
2.1x
3.4x
1.6x
2.3x
0.9x
-
2.1x
2.0x
1.4x
1.7x
5.3x
3.2x
2.0x
2.0x
3.1x
1.9x
1.3x
1.1x
6.0x
2.0x
1.6x
1.7x
1.4x
4.5x
3.0x
2.1x
2.1x
3.3x
2.1x
0.6x
1.5x
4.6x
1.9x
1.7x
1.4x
1.3x
5.8x
2.9x
2.0x
2.4x
3.5x
2.5x
0.4x
1.7x
4.3x
2.3x
1.8x
1.3x
1.3x
7.7x
2.9x
2.3x
3.3x
3.3x
2.9x
0.7x
1.5x
2.7x
14.1x
7.3x
14.0x
11.6x
22.1x
11.4x
10.7x
17.7x
9.0x
23.5x
5.0x
-
11.8x
5.6x
12.1x
8.9x
19.2x
10.9x
10.6x
14.7x
8.4x
36.6x
5.1x
-
11.5x
4.9x
14.1x
7.9x
16.7x
9.9x
11.0x
12.6x
9.2x
30.2x
5.0x
-
10.7x
5.1x
11.4x
7.3x
21.3x
9.6x
10.1x
13.9x
9.7x
36.4x
5.7x
-
12.6x
5.1x
9.9x
6.8x
28.1x
9.8x
10.7x
19.4x
9.3x
23.2x
4.6x
-
8.8%
8.7%
555.3% 213.8%
-3.7%
-0.8%
17.5% 16.0%
13.1% 15.7%
2.3%
1.8%
10.7% 10.1%
-13.0% -12.3%
9.6%
11.5%
4.7%
4.9%
45.4% 38.2%
1.8%
16.7%
-
-0.9%
20.4%
-1.9%
13.3%
18.7%
5.9%
11.0%
-8.4%
12.0%
0.7%
14.3%
35.4%
25.3%
-0.9%
20.4%
-1.9%
13.3%
18.7%
5.9%
7.6%
-8.4%
12.0%
0.7%
14.3%
35.4%
25.3%

-5.3%
-2.3%
0.3%
7.3%
18.7%
8.3%
6.9%
-1.4%
13.7%
-3.1%
1.5%
26.8%
27.4%
17.0% 17.6% 17.7% 17.7% 18.4%

36.0% 36.5% 32.8% 32.8% 35.2%
10.4% 11.6% 12.2% 12.2% 13.3%
19.2% 19.2% 17.9% 17.9% 18.9%
27.2% 27.4% 27.1% 27.1% 27.5%
30.1% 29.6% 29.9% 29.9% 29.1%
20.0% 19.1% 18.9% 20.1% 21.6%
11.6% 13.4% 16.9% 16.9% 16.8%
37.8% 37.0% 36.0% 36.0% 35.5%
7.0%
5.1%
6.9%
6.9%
12.4%
-2.0%
-4.9% -12.1% -12.1% -14.5%
17.3% 21.1% 30.7% 30.7% 32.3%
-33.8% -40.7% -43.3% -43.3% -46.5%
60

SEG Software Index
Company
EV/Revenue
EV/EBITDA
TTM Revenue Growth
EBITDA Margin
2Q14
1.5x
7.0x
6.0x
3.4x
1.3x
3.6x
1.3x
2.7x
2.6x
3.3x
3.7x
2.3x
3.9x
4.9x
4.5x
9.0x
8.1x
3.2x
4.5x
2.3x
2.8x
8.6x
5.8x
0.9x
14.8x
4.5x
4.6x
2.1x
3.4x
5.8x
2.1x
3.7x
3Q14
1.6x
5.5x
5.1x
3.3x
1.2x
3.4x
1.2x
2.2x
2.3x
1.8x
3.5x
2.1x
4.2x
4.5x
4.4x
7.7x
6.1x
3.2x
4.6x
2.2x
2.7x
6.5x
4.1x
0.9x
10.8x
3.7x
3.5x
1.9x
2.9x
5.1x
1.9x
3.6x
4Q14
1.7x
5.9x
5.6x
6.7x
1.5x
3.7x
1.1x
2.2x
2.1x
0.7x
3.6x
2.0x
4.1x
3.7x
4.3x
9.3x
5.6x
3.4x
5.1x
2.4x
2.9x
6.9x
3.7x
0.9x
8.0x
7.1x
3.9x
1.7x
2.7x
5.9x
1.3x
3.7x
1Q15
1.9x
46.5x
5.6x
5.7x
10.9x
1.5x
3.1x
1.3x
1.8x
2.6x
1.2x
3.2x
2.4x
4.2x
3.6x
4.2x
11.4x
4.0x
3.4x
2.9x
2.3x
3.1x
8.1x
3.8x
0.9x
6.0x
4.9x
4.4x
1.6x
3.5x
5.8x
1.1x
3.3x
2Q15
2.5x
26.3x
5.3x
7.1x
16.8x
1.1x
3.2x
1.2x
2.1x
3.4x
1.1x
3.5x
2.6x
3.7x
2.4x
4.7x
15.2x
3.5x
3.6x
3.9x
2.4x
3.7x
10.8x
3.1x
1.2x
5.1x
5.2x
5.3x
1.7x
4.4x
7.3x
1.5x
4.8x
2Q14
20.6x
13.3x
8.0x
14.9x
8.5x
6.9x
14.8x
36.1x
15.5x
15.2x
18.3x
10.3x
14.9x
12.8x
14.6x
9.4x
264.8x
16.1x
49.9x
18.3x
387.7x
15.3x
23.5x
30.2x
37.2x
12.7x
3Q14
16.3x
12.4x
7.6x
13.6x
5.8x
13.5x
38.6x
14.6x
15.1x
18.2x
10.1x
14.5x
12.9x
15.6x
8.7x
15.5x
40.8x
13.6x
208.5x
17.0x
21.8x
27.3x
153.8x
12.4x
4Q14
17.9x
13.4x
21.6x
9.0x
14.6x
5.8x
11.5x
37.0x
13.0x
13.7x
17.9x
9.8x
15.3x
17.0x
19.0x
9.2x
13.3x
32.1x
24.6x
769.0x
18.6x
15.1x
32.0x
26.4x
12.9x
1Q15
17.2x
13.7x
35.0x
9.4x
12.0x
4.9x
13.7x
33.3x
15.6x
14.0x
17.6x
9.6x
16.1x
9.6x
18.0x
11.6x
12.8x
24.3x
16.9x
851.5x
17.8x
19.6x
31.6x
23.6x
11.7x
2Q15
2Q14
3Q14
4Q14
1Q15
2Q15
4.7%
-8.3% -18.6% -18.6% -13.3%
1330.3% 1330.3% 665.4%
17.0x
8.3%
9.0%
10.7% 10.7%
8.1%
17.2x
-0.7% 16.3%
9.1%
9.1%
9.2%
53.9x -20.4% -17.3% -6.9%
-6.9%
-6.9%
7.9x
-0.1%
-1.7%
-1.9%
-2.5%
-3.2%
11.7x 13.1% 18.7% 16.8% 16.8% 14.4%
-17.9% -21.7% -9.6%
-9.6% 16.6%
5.5x
7.9%
8.2%
6.8%
6.8%
7.6%
17.3x
6.8%
6.8%
6.6%
6.6%
7.9%
123.1% 123.1% 68.9% 68.9% 40.5%
32.6x
4.1%
2.2%
3.5%
3.5%
2.1%
17.3x 17.3% 14.4% 15.8% 15.8% 15.2%
12.8x 11.8% 19.2% 35.4% 35.4% 26.1%
13.6x 40.7% 39.9% 60.2% 60.2% 60.1%
11.2x
2.9%
3.0%
3.4%
2.5%
-0.1%
48.1% 51.0% 51.1% 53.0% 54.5%
40.6% 40.6% 30.4%
17.6x
3.4%
4.8%
4.9%
4.5%
2.2%
13.0x 12.3%
9.5%
-1.3%
-1.3%
-4.3%
20.1x 14.2% 16.7% 15.9% 15.9% 13.2%
16.7x
-0.8%
-1.2%
-0.4%
4.5%
7.2%
33.3% 39.0% 41.8% 41.8% 40.6%
22.3% 22.1% 28.3% 28.3% 24.0%
16.6x
9.0%
10.3% 11.8% 10.8%
8.4%
19.6x 123.6% 121.3% 107.2% 107.2% 82.7%
16.5x 30.0% 26.3% 26.2% 26.2% 24.5%
987.4x 19.5% 18.8% 18.4% 18.4% 16.7%
16.3x
-3.4%
0.3%
8.2%
8.2%
10.2%
23.0x
5.1%
8.4%
15.0% 15.0% 14.7%
38.7x 15.8% 16.6% 16.5% 16.6% 15.8%
22.2x 349.5% 156.4% 38.1% 38.1% -3.1%
16.8x
-3.7%
-4.4%
-1.6%
-1.6%
1.9%
2Q14
3Q14
4Q14
1Q15
2Q15
-1.0% -11.6% -23.9% -23.9% -22.6%
-89.0% -72.4% -52.1% -52.1% -24.6%
34.2% 34.0% 32.8% 32.8% 31.1%
44.8% 41.2% 41.3% 41.3% 41.2%
-11.4% -6.8% 31.2% 31.2% 31.2%
16.2% 16.4% 16.4% 16.0% 14.3%
24.1% 24.6% 25.5% 25.5% 27.5%
15.2% -8.9% -17.0% -17.0% -4.2%
38.7% 37.6% 37.2% 37.2% 38.6%
17.5% 16.9% 18.7% 18.7% 19.5%
-8.5%
-8.5% -20.1% -20.1% -18.0%
10.2%
9.1%
9.7%
9.7%
10.9%
15.2% 14.7% 15.1% 15.1% 15.0%
25.5% 27.6% 30.0% 30.0% 28.9%
26.6% 24.5% 20.7% 20.7% 17.9%
43.7% 43.7% 43.6% 43.2% 42.0%
-5.0%
-7.5%
-8.8% -10.4% -12.1%
-1.0% -1.4% -1.7% -1.7% -3.6%
21.8% 22.3% 21.9% 20.9% 20.3%
34.8% 35.4% 29.9% 29.9% 30.1%
15.8% 14.4% 12.8% 12.8% 12.0%
29.3% 30.9% 31.5% 26.5% 22.1%
-15.1% -16.4% -16.4% -16.4% -17.1%
2.2%
-0.6%
-2.7%
-2.7%
-5.3%
5.7%
5.7%
6.5%
7.0%
7.1%
29.7% 26.6% 24.8% 24.8% 25.9%
24.3% 27.5% 28.9% 28.9% 31.4%
1.2%
1.7%
0.5%
0.5%
0.5%
13.9% 11.1%
9.0%
9.0%
10.4%
14.4% 13.5% 17.8% 17.8% 19.1%
19.1% 18.8% 18.5% 18.5% 18.9%
5.6%
1.2%
4.8%
4.8%
6.7%
29.5% 28.9% 28.4% 28.4% 28.4%
SAP AG
Sapiens International
Silver Spring Networks
4.3x
2.2x
3.3x
4.0x
2.0x
2.0x
4.4x
1.9x
2.0x
3.9x
2.0x
1.5x
4.8x
2.3x
1.8x
12.8x
19.0x
-
12.1x
17.2x
-
12.9x
16.2x
-
11.5x
16.5x
-
14.7x
18.4x
-
2.7%
17.6%
62.8%
2.2%
16.6%
3.5%
4.4%
4.4%
16.3% 16.3%
-41.5% -41.5%
8.6%
15.2%
-8.4%
33.5%
11.3%
-7.2%
32.8% 34.2% 34.2%

11.6% 11.9% 11.9%
-22.7% -41.9% -41.9%
32.9%
12.7%
-6.3%
Software AG
2.4x
2.5x
2.1x
2.0x
2.5x
9.7x
10.6x
8.4x
8.0x
9.5x
-6.0%
-8.2%
-11.8% -11.8% -11.9%
24.8%
23.6%
26.1%
Model N
Momo
Monotype Imaging Holdings
MSCI
Myriad Group AG
NetApp
Netscout Systems
NetSol Technologies
NeuStar
NICE Systems Ltd
NQ Mobile
Nuance Communications, Inc.
Omnicell
Open Text Corp
Opera
Oracle
Palo Alto Networks
Pandora Media
Parametric Technology
PDF Solutions
Pegasystems
Progress Software
Proofpoint
PROS Holdings
QAD
Qihoo 360 Technology
Qiwi
Qlik Technologies
Quality Systems
Radware
Red Hat
Redknee Solutions
Sage Group

25.4%
25.4%
61

SEG Software Index
Company
SolarWinds
EV/Revenue
EV/EBITDA
TTM Revenue Growth
EBITDA Margin
2Q14
3Q14
4Q14
1Q15
2Q15
2Q14
3Q14
4Q14
1Q15
2Q15
2Q14
3Q14
4Q14
1Q15
2Q15
2Q14
3Q14
4Q14
1Q15
2Q15
8.7x
7.1x
6.9x
8.3x
7.7x
22.7x
20.2x
21.8x
26.1x
24.9x
27.0%
29.3%
27.8%
27.8%
25.5%
38.4%
35.2%
31.9%
31.9%
31.0%
12.7%
6.7%
6.7%
7.1%
Sourcefire
1.0x
1.0x
1.3x
0.9x
1.0x
7.2x
8.1x
18.8x
13.3x
13.7x
36.0%
43.9%
10.3%
10.3%
2.2%
13.6%
Splunk
23.9x
14.3x
12.0x
14.9x
15.5x
51.3%
51.6%
50.6%
49.0%
48.1%
-31.0% -40.8% -44.9% -45.1% -45.5%
SS&C
5.7x
5.6x
5.6x
6.1x
7.3x
14.3x
14.3x
14.4x
15.8x
19.5x
14.9%
7.1%
7.7%
7.7%
8.6%
39.6%
39.0%
38.9%
38.9%
37.5%
Stratasys
9.0x
6.8x
6.8x
6.4x
2.0x
57.8x
46.9x
49.9x
47.4x
18.5x
101.2%
88.0%
54.9%
54.9%
43.4%
15.6%
14.6%
13.6%
13.6%
10.6%
Symantec
1.8x
1.9x
2.2x
2.4x
2.3x
6.3x
6.6x
7.5x
8.2x
8.1x
-3.3%
-3.5%
-2.9%
-2.7%
-2.5%
29.0%
29.0%
29.2%
29.0%
28.3%
Synchronoss Technologies
3.7x
3.2x
3.6x
3.9x
4.2x
15.8x
12.5x
13.5x
14.8x
15.4x
28.5%
27.8%
31.0%
31.0%
33.2%
23.7%
25.7%
26.6%
26.6%
27.1%
Synopsys
2.6x
2.5x
2.7x
2.7x
3.1x
15.0x
14.3x
14.9x
14.2x
16.3x
6.0%
5.8%
4.9%
7.9%
8.8%
17.3%
17.6%
18.0%
18.9%
19.3%
Take-Two Interactive
0.7x
0.6x
1.6x
1.9x
1.5x
3.8x
3.3x
93.5%
106.3% -60.2% -60.2% -53.9%
18.4%
19.3%
-4.9%
-4.9%
-21.9%
Tangoe
3.6x
2.7x
2.3x
2.2x
2.2x
44.1x
37.7x
30.3x
28.5x
28.5x
17.7%
14.4%
12.5%
12.5%
10.9%
8.1%
7.2%
7.7%
7.7%
7.7%
TeleCommunication Systems
0.6x
0.8x
0.7x
0.7x
0.8x
10.2x
10.4x
8.4x
8.3x
8.9x
-26.9% -24.8%
-0.7%
-0.7%
1.1%
6.3%
7.4%
8.4%
8.4%
8.9%
TeleNav
0.4x
0.5x
0.6x
0.9x
1.5x
-16.9% -21.6% -21.7% -21.7%
-7.1%
-8.0%
-15.7% -25.6% -25.6% -22.7%
Teradata
2.7x
2.3x
2.2x
2.2x
2.0x
11.3x
9.6x
10.1x
10.0x
9.9x
3.6%
3.6%
1.5%
1.5%
-1.7%
23.6%
23.3%
22.0%
22.0%
20.1%
The Descartes Systems Group
5.5x
5.2x
6.0x
5.7x
6.0x
19.5x
18.1x
20.5x
19.3x
20.0x
20.6%
17.2%
15.3%
12.9%
10.3%
28.2%
28.7%
29.1%
29.5%
30.0%
Trend Micro
2.6x
2.9x
3.6x
3.2x
3.8x
7.5x
8.4x
10.1x
8.9x
11.0x
13.5%
9.8%
6.4%
6.4%
6.8%
34.7%
35.1%
35.8%
35.8%
34.4%
Tyler Technologies
6.4x
5.6x
5.8x
7.0x
7.7x
32.7x
27.4x
26.8x
32.0x
34.6x
15.2%
17.2%
18.4%
18.4%
18.9%
19.5%
20.5%
21.8%
21.8%
22.3%
Ubisoft Entertainment
1.6x
1.5x
1.1x
1.2x
1.1x
4.9x
4.9x
5.7x
6.2x
9.1x
-19.8% -12.7%
16.9%
16.9%
45.3%
32.9%
30.3%
19.5%
19.5%
12.6%
Varonis Systems
10.9x
5.7x
4.2x
4.3x
4.3x
43.7%
38.0%
35.8%
35.8%
34.5%
-11.1% -14.0% -15.8% -15.8% -18.3%
VASCO Data Security International
1.3x
1.9x
2.2x
4.6x
3.9x
11.4x
14.2x
11.2x
23.5x
17.9x
0.9%
14.3%
30.0%
30.0%
43.7%
11.5%
13.3%
19.5%
19.5%
22.1%
Verint Systems Inc
3.0x
2.7x
3.0x
3.4x
3.7x
18.1x
18.4x
22.9x
24.1x
25.5x
13.2%
18.3%
21.8%
24.4%
18.8%
16.6%
14.5%
13.2%
14.2%
14.3%
Verisk
6.8x
6.7x
6.6x
6.4x
7.4x
14.9x
14.7x
14.6x
14.2x
16.0x
13.3%
14.2%
9.5%
9.5%
10.3%
45.6%
45.4%
45.2%
45.2%
46.1%
VMWare
8.2x
6.5x
6.0x
5.1x
5.1x
29.5x
24.8x
23.9x
20.2x
20.2x
13.4%
15.0%
15.9%
15.9%
15.1%
27.8%
26.0%
25.3%
25.3%
25.1%

62
THE SEG SOFTWARE INDEX METRICS BY PRODUCT CATEGORY

EV/Revenue
EV/EBITDA
EV/Earnings
Gross Profit Margin
EBITDA Margin
Net Income Margin
TTM Revenue Growth (YoY)
TTM EBITDA Growth (YoY)
TTM Earnings Growth (YoY)
Current Ratio
Cash as Percent of Market Cap
Enterprise Value Growth (YoY)
2Q14
1.9x
10.1x
20.7x
57.3%
18.4%
12.2%
4.8%
2.3%
-9.2%
2.7
15.0%
33.3%
3Q14
1.8x
9.9x
19.2x
56.3%
21.1%
11.7%
8.2%
-0.5%
-3.3%
2.7
20.8%
25.3%
4Q14
1.8x
9.1x
16.3x
59.7%
26.6%
12.5%
18.3%
51.2%
28.1%
2.6
22.5%
2.5%
1Q15
1.8x
9.7x
15.6x
59.7%
26.6%
12.5%
18.3%
39.2%
28.1%
2.6
17.7%
0.0%
EV/Revenue
EV/EBITDA
EV/Earnings
Gross Profit Margin
EBITDA Margin
Net Income Margin
Current Ratio
2Q14
3.3x
14.9x
28.1x
73.4%
16.8%
8.4%
13.7%
3.4%
-0.1%
2.0
13.9%
5.3%
3Q14
3.0x
15.3x
28.2x
73.4%
16.3%
8.1%
15.4%
0.7%
0.1%
2.0
17.5%
-13.0%
4Q14
3.3x
14.8x
28.5x
74.6%
15.7%
8.3%
10.0%
-6.9%
-7.6%
2.1
16.0%
-9.7%
EV/Revenue
EV/EBITDA
EV/Earnings
Gross Profit Margin
EBITDA Margin
Net Income Margin
Current Ratio
2Q14
2.4x
9.4x
17.1x
70.0%
19.2%
11.1%
-0.8%
7.6%
-4.1%
2.1
20.2%
7.0%
3Q14
1.8x
9.5x
16.9x
69.8%
19.2%
10.9%
1.2%
14.0%
-6.5%
2.4
23.8%
16.7%
Engineering & PLM

EV/Revenue
EV/EBITDA
EV/Earnings
Gross Profit Margin
EBITDA Margin
Net Income Margin
Current Ratio
2Q14
4.3x
14.9x
24.7x
83.0%
20.0%
12.9%
8.4%
4.5%
-1.2%
2.3
12.0%
15.0%
3Q14
4.7x
15.6x
25.6x
82.9%
19.9%
12.5%
7.4%
5.8%
15.3%
2.0
12.2%
14.9%
2Q15
2.0x
10.1x
16.0x
59.7%
27.1%
12.7%
7.6%
16.0%
24.2%
2.7
16.3%
13.8%

EV/Revenue
EV/EBITDA
EV/Earnings
Gross Profit Margin
EBITDA Margin
Net Income Margin
Current Ratio
2Q14
3.6x
12.3x
20.0x
61.3%
29.5%
18.0%
2.7%
4.0%
16.0%
1.2
20.2%
19.7%
3Q14
3.4x
11.9x
20.9x
61.4%
28.9%
16.2%
3.0%
1.6%
7.7%
1.2
21.5%
21.3%
4Q14
3.3x
11.7x
23.0x
61.5%
28.4%
14.5%
3.4%
-7.8%
-1.4%
1.2
21.6%
14.2%
1Q15 2Q15
4.0x
4.7x
12.9x
16.6x
21.5x
26.0x
61.1% 60.3%
28.4% 28.4%
14.5% 14.7%
2.5%
2.3%
-6.9% -12.6%
-1.4% -9.3%
1.5
1.6
23.2% 22.9%
2.2%
5.2%
IT Conglomerates
EV/Revenue
EV/EBITDA
EV/Earnings
Gross Profit Margin
EBITDA Margin
Net Income Margin
Current Ratio
2Q14
3.3x
8.6x
14.1x
61.3%
33.5%
19.7%
2.7%
1.4%
8.1%
1.2
20.2%
19.7%
1Q15 2Q15
3.6x
3.9x
16.5x 18.3x
31.4x 38.9x
74.6% 75.3%
15.7% 15.2%
8.3%
7.2%
10.0% 10.0%
-8.6% -17.8%
-7.6% -5.9%
1.9
1.8
13.8% 13.9%
-3.5% 27.4%

EV/Revenue
EV/EBITDA
EV/Earnings
Gross Profit Margin
EBITDA Margin
Net Income Margin
Current Ratio
2Q14
3.6x
12.9x
22.4x
55.2%
24.3%
11.5%
4.7%
3.4%
11.0%
1.2
5.5%
21.5%
3Q14
3.3x
13.2x
25.3x
56.3%
26.0%
14.4%
2.5%
6.6%
34.2%
1.3
5.4%
13.8%
4Q14
3.3x
14.8x
28.3x
55.2%
23.3%
14.5%
5.2%
0.1%
16.4%
1.2
5.0%
6.0%
1Q15
3.5x
14.7x
30.0x
55.2%
23.3%
14.5%
5.2%
-2.6%
16.4%
1.2
5.4%
4.9%
2Q15
4.1x
16.8x
33.6x
56.0%
22.3%
11.1%
4.3%
-2.9%
9.3%
1.3
4.6%
14.9%
EV/Revenue
EV/EBITDA
EV/Earnings
Gross Profit Margin
EBITDA Margin
Net Income Margin
Current Ratio
2Q14
3Q14 4Q14 1Q15 2Q15
2.9x
3.1x
2.9x
2.1x
2.4x
16.2x
18.5x 21.0x 17.7x
17.5x
33.8x
46.5x 46.1x 46.5x
78.1x
52.6% 52.4% 57.2% 57.2% 57.4%
-0.4%
-1.9% 4.2%
4.2%
4.3%
-6.1% -10.7% -2.5% -2.5% -3.1%
17.9% 21.1% 22.9% 22.9% 19.1%
5.2%
1.3% -0.8% -27.2% -24.8%
156.3% 147.0% 1.3%
1.3%
-3.2%
2.9
2.8
3.6
3.6
3.6
15.1% 16.1% 19.5% 19.8% 18.1%
34.6% 29.5% -11.4% -35.6% -17.3%
4Q14
2.0x
8.0x
15.8x
72.5%
18.5%
10.3%
4.1%
12.1%
-9.9%
2.4
22.8%
4.8%
1Q15 2Q15
2.2x
2.5x
8.8x
9.5x
16.8x 18.9x
72.5% 73.5%
18.5% 18.9%
10.1% 9.3%
4.5%
7.2%
0.5%
5.7%
-9.9% -10.5%
1.6
1.7
23.1% 21.6%
5.2% 47.1%
Gaming
EV/Revenue
EV/EBITDA
EV/Earnings
Gross Profit Margin
EBITDA Margin
Net Income Margin
Current Ratio
2Q14
1.9x
12.7x
70.8x
64.4%
15.9%
2.4%
-4.8%
-19.5%
-48.4%
2.5
15.5%
37.1%
3Q14
1.5x
13.0x
65.3x
63.0%
15.5%
2.8%
0.2%
-18.5%
-15.1%
3.2
19.4%
10.9%
4Q14
1.7x
11.4x
25.9x
67.0%
15.9%
3.1%
-2.2%
-41.3%
-28.4%
2.5
18.6%
27.2%
1Q15
1.6x
12.5x
27.3x
67.0%
15.9%
3.1%
-2.2%
-35.7%
-28.4%
2.5
18.4%
15.3%
2Q15
1.4x
12.6x
19.4x
66.7%
13.0%
5.2%
2.5%
-24.4%
122.1%
2.1
23.1%
-2.8%
Networking & Network Perf Mgmt

EV/Revenue
EV/EBITDA
EV/Earnings
Gross Profit Margin
EBITDA Margin
Net Income Margin
Current Ratio
2Q14
2.9x
15.5x
21.9x
74.3%
8.0%
4.2%
5.1%
-1.5%
3.3%
2.9
21.9%
11.2%
3Q14
2.2x
15.7x
21.8x
74.2%
8.5%
4.4%
8.4%
13.4%
9.1%
2.8
22.8%
-0.6%
4Q14
2.0x
15.7x
26.3x
73.2%
10.5%
-0.3%
13.5%
14.7%
17.2%
2.6
29.8%
17.1%
1Q15
2.2x
13.9x
20.9x
73.2%
10.2%
-4.7%
16.2%
12.4%
13.1%
2.5
26.5%
6.0%
4Q14
3.4x
16.0x
28.5x
83.1%
19.9%
11.8%
7.4%
2.2%
3.8%
1.7
12.4%
-4.4%
1Q15
3.8x
15.7x
28.4x
84.1%
20.9%
11.8%
8.3%
4.7%
-3.3%
1.7
12.5%
1.9%
Healthcare
EV/Revenue
EV/EBITDA
EV/Earnings
Gross Profit Margin
EBITDA Margin
Net Income Margin
Current Ratio
2Q14
2.3x
14.2x
37.5x
54.4%
14.5%
3.8%
0.1%
7.3%
2.3%
1.6
7.2%
11.6%
3Q14 4Q14 1Q15

2.2x
2.4x
2.6x
15.1x 14.8x 16.4x
36.3x 34.1x 34.2x
54.0% 53.4% 53.4%
14.1% 16.0% 16.0%
3.0%
3.2%
3.2%
1.1%
3.9%
3.9%
8.4%
7.7%
8.3%
2.8%
0.5% 27.3%
1.6
1.5
1.5
9.9%
9.1%
6.4%
0.1% -2.9% -9.6%
2Q15
2.7x
16.8x
34.4x
53.7%
15.9%
6.2%
7.1%
9.3%
19.0%
1.4
6.0%
7.8%
Security
EV/Revenue
EV/EBITDA
EV/Earnings
Gross Profit Margin
EBITDA Margin
Net Income Margin
Current Ratio
2Q14
3.2x
11.6x
17.3x
76.7%
11.5%
6.2%
16.5%
-12.7%
0.9%
1.8
12.2%
20.1%
3Q14
3.2x
15.0x
18.0x
76.7%
12.5%
5.1%
15.2%
0.5%
26.3%
1.9
15.1%
14.0%
4Q14
4.6x
16.4x
24.6x
76.1%
6.7%
3.3%
17.6%
-5.4%
11.0%
1.9
14.2%
5.4%
1Q15 2Q15
3.9x
3.9x
17.2x
17.1x
21.1x
23.3x
76.1% 75.4%
6.7%
7.1%
3.3%
2.3%
18.7% 12.6%
-7.1% -11.8%
6.8%
-0.4%
1.9
1.7
13.4% 12.0%
10.3% 29.6%
2Q15
3.6x
17.2x
30.5x
84.5%
21.4%
11.1%
8.7%
4.9%
-7.6%
1.7
13.4%
17.5%

3Q14
3.5x
9.6x
14.5x
61.4%
32.8%
18.7%
2.2%
1.6%
3.1%
1.2
21.5%
21.3%
4Q14
3.5x
9.6x
15.8x
61.5%
34.2%
18.7%
3.4%
3.1%
-2.0%
1.2
21.6%
14.2%
1Q15 2Q15
3.1x
3.3x
8.8x
9.3x
15.8x
16.4x
61.1% 60.3%
34.2% 32.9%
18.7% 17.2%
2.5%
-0.1%
1.5%
-3.9%
-6.6% -10.8%
1.2
1.3
19.4% 24.9%
8.7%
3.0%
2Q15
2.3x
14.3x
18.9x
73.2%
10.9%
-4.9%
13.6%
12.8%
28.7%
2.6
22.1%
27.4%
63
THE SEG SOFTWARE INDEX METRICS BY PRODUCT CATEGORY

Storage, Data Mgmt & Integration
EV/Revenue
EV/EBITDA
EV/Earnings
Gross Profit Margin
EBITDA Margin
Net Income Margin
Current Ratio
2Q14
2.5x
8.2x
13.7x
79.4%
18.0%
10.5%
2.9%
7.7%
10.4%
2.5
20.3%
6.2%
3Q14
2.5x
9.0x
16.2x
79.7%
17.7%
10.1%
2.0%
8.8%
10.3%
2.5
23.1%
-2.3%
4Q14
2.6x
9.1x
17.5x
79.7%
17.5%
10.4%
2.4%
-7.9%
-6.1%
2.4
23.6%
-4.3%
1Q15
2.5x
9.2x
18.6x
79.7%
17.3%
10.4%
3.2%
-5.1%
-6.1%
2.3
21.2%
-8.2%
2Q15
2.5x
9.2x
17.5x
81.7%
16.2%
9.8%
3.4%
-0.6%
-4.7%
2.3
19.9%
1.4%
Systems Management
EV/Revenue
EV/EBITDA
EV/Earnings
Gross Profit Margin
EBITDA Margin
Net Income Margin
Current Ratio
2Q14
4.5x
17.5x
30.9x
85.6%
26.0%
15.9%
13.3%
10.9%
6.2%
1.3
8.8%
6.5%
3Q14
5.0x
19.4x
37.3x
85.4%
25.4%
15.2%
15.8%
13.5%
8.4%
1.2
9.3%
12.3%
4Q14
4.3x
18.2x
39.3x
84.9%
25.4%
13.7%
16.2%
4.2%
-12.8%
1.5
10.0%
19.5%
1Q15
4.1x
17.4x
37.4x
84.9%
25.4%
13.7%
16.3%
0.9%
-12.8%
1.5
10.5%
4.4%
2Q15
4.3x
18.3x
39.9x
84.8%
26.3%
13.9%
14.7%
2.8%
-7.2%
1.5
10.7%
9.7%
Vertical - Finance
EV/Revenue
EV/EBITDA
EV/Earnings
Gross Profit Margin
EBITDA Margin
Net Income Margin
Current Ratio
2Q14
4.2x
13.2x
26.1x
43.5%
26.0%
13.3%
4.8%
3.7%
13.6%
1.4
5.1%
21.2%
3Q14
4.1x
13.4x
24.2x
44.0%
28.8%
13.6%
5.4%
7.6%
27.2%
1.4
7.0%
14.8%
4Q14
4.1x
13.7x
25.4x
44.2%
29.8%
14.3%
6.2%
11.9%
11.0%
1.4
6.6%
10.1%
1Q15
4.4x
16.3x
27.2x
44.2%
29.8%
14.3%
6.2%
7.7%
11.0%
1.4
3.6%
19.4%
2Q15
4.3x
15.5x
26.6x
44.5%
30.3%
13.7%
6.5%
4.6%
4.0%
1.4
4.8%
30.9%
Vertical - Other
EV/Revenue
EV/EBITDA
EV/Earnings
Gross Profit Margin
EBITDA Margin
Net Income Margin
Current Ratio
2Q14
3.2x
23.4x
58.1x
46.6%
13.5%
6.1%
21.2%
14.1%
12.1%
1.7
5.4%
9.2%
3Q14
3.4x
22.4x
57.9x
46.9%
13.2%
6.5%
16.6%
5.7%
7.8%
1.6
10.2%
14.7%
4Q14
3.6x
23.9x
60.9x
47.3%
11.9%
5.0%
16.3%
-3.8%
10.7%
1.5
8.8%
9.0%
1Q15
4.0x
26.4x
67.4x
47.3%
11.9%
5.1%
16.3%
17.5%
20.8%
1.5
6.0%
16.6%
2Q15
4.6x
30.2x
81.0x
47.5%
12.9%
4.9%
13.3%
19.5%
19.3%
1.7
5.9%
35.9%

64
THE SEG SaaS INDEX COMPANIES KEY METRICS

Company
EV/Revenue
3Q14
4Q14
1Q15
10.7x
9.8x
9.9x
12.7x
7.0x
5.4x
41.7x
37.5x
35.0x
3.3x
2.8x
2.4x
6.9x
6.7x
4.6x
6.1x
6.0x
8.6x
4.1x
3.0x
2.7x
2Q14
106.6x
21.0x
2Q15
29.5x
76.8x
18.6x
2Q14
24.4%
56.3%
40.1%
14.5%
29.0%
19.6%
28.5%
13.7%
TTM Revenue Growth

3Q14
4Q14
1Q15
2Q15
2Q14
32.6% 32.6% 31.2% -32.9%
28.5% 28.5% 26.9% 19.3%
30.2% 23.4% 23.4% 16.3% -50.3%
22.1%
-55.7%
79.6% 79.6%
-28.6%
36.0% 26.5% 26.5% 25.9%
9.2%
14.7% 16.9% 20.0% 13.7% -17.7%
31.1% 31.2% 31.2% 33.9% -26.0%
83.4% 74.3% 62.0% -99.2%
23.6% 21.6% 21.6% 23.4% -1.7%
251.5% 251.5% 173.5% -382.4%
28.9% 24.8% 24.8% 21.7% -24.4%
14.4% 16.2% 16.2% 15.9% 10.3%
EBITDA Margin
3Q14
4Q14
1Q15
-32.3% -24.4% -24.4%
17.1% 14.6% 14.6%
-40.9% -35.2% -35.2%
-106.7% -98.1% -83.7%
-28.6% -14.1% -14.1%
9.1%
8.2%
8.2%
-17.4% -15.1% -12.1%
-30.8% -37.6% -37.6%
-99.2% -71.0% -64.9%
-0.2%
-1.9%
-1.9%
-295.7% -186.0% -186.0%
-30.4% -33.2% -33.2%
11.0% 11.2% 11.2%
2U
Alarm.com
Amber Road
Apigee Corporation
AppFolio
Athenahealth
Bazaarvoice
Benefitfocus
Box
Callidus Software
Castlight Health
ChannelAdvisors
Constant Contact
2Q14
6.8x
7.0x
9.9x
3.1x
10.0x
4.6x
103.3x
11.4x
2.2x
Cornerstone OnDemand
12.3x
2.2x
1.3x
1.4x
6.0x
55.7%
48.8%
42.4%
42.4%
36.7%
-15.7% -16.6% -16.1% -16.1% -16.9%
Covisint
Cvent
DealerTrack
Demandware
Ebix
Ellie Mae
2.3x
11.2x
5.0x
17.4x
3.3x
5.9x
8.2x
16.3x
0.3x
7.5x
11.5x
13.0x
9.9x
14.5x
0.1x
5.7x
10.9x
10.8x
10.7x
12.4x
0.1x
5.8x
13.8x
11.1x
0.5x
6.3x
2.9x
12.0x
5.5x
9.5x
355.5x
55.1x
9.0x
36.3x
351.5x
3.4x
30.0x
77.7x
401.5x
1.2x
29.6x
55.5x
344.0x
0.9x
37.3x
57.0x
432.9x
24.2x
15.3x
45.7x
7.1%
31.9%
30.8%
41.4%
-2.2%
16.1%
0.4%
29.6%
46.9%
48.2%
-3.5%
10.6%
-9.1%
28.0%
77.4%
50.6%
4.7%
25.7%
-9.1%
28.0%
77.4%
50.6%
4.7%
25.7%
-8.9%
28.6%
78.5%
50.2%
11.4%
41.4%
-34.6% -43.2% -37.6% -37.6% -30.4%

3.1%
4.6%
3.6%
3.6%
1.5%
9.1%
9.5%
12.4% 12.4% 12.1%
-12.0% -11.2% -13.2% -13.2% -11.5%
36.6% 38.5% 36.9% 36.9% 36.2%
16.3% 16.7% 19.5% 19.5% 20.9%
FireEye
Fleetmatics
Halogen Software
HealthStream
HortonWorks
HubSpot
44.0x
6.1x
2.7x
4.5x
-
2.3x
3.4x
93.8x
6.8x
3.3x
6.3x
1.3x
3.8x
81.3x
6.2x
2.8x
5.1x
1.4x
4.6x
76.9x
7.0x
2.7x
5.9x
14.0x
6.3x
2.3x
4.4x
13.9x
11.4x
25.2x
26.5x
-
15.5x
41.5x
-
15.1x
37.8x
-
18.2x
42.7x
-
24.3x
25.7x
-
111.5% 132.9% 163.5% 163.5% 130.3% -100.5% -103.6%

38.3% 35.7% 30.6% 30.6% 28.5% 24.0% 21.9%
22.4% 21.3% 18.1% 18.1% 18.2% -8.9% -11.7%
28.5% 30.9% 29.0% 29.0% 27.3% 17.0% 16.3%
71.8% 71.8% 96.6% -219.0% -201.5%
49.3% 49.3% 52.7% -40.3% -35.6%
inContact
3.8x
5.5x
3.2x
16.4%
19.9%
32.1%
32.1%
37.4%
-2.1%
IntraLinks Holdings
2.4x
4.5x
2.3x
50.7x
95.5x
50.7x
8.1%
8.7%
9.1%
9.1%
10.1%
4.7%
J2 Global
4.3x
0.8x
0.9x
0.8x
5.4x
10.2x
2.0x
2.1x
1.9x
13.1x
35.9%
21.0%
15.0%
15.0%
15.7%
42.2%
Jive Software
Liquid Holdings Group
LivePerson
Marin Software
Marketo
Medical Transcript
Medidata Solutions
3.2x
3.1x
3.1x
11.7x
10.4x
3.1x
504.5x
2.4x
3.7x
20.8x
3.1x
2.7x
455.6x
1.9x
4.1x
11.9x
3.1x
3.4x
505.4x
1.6x
4.4x
12.2x
3.6x
1.7x
2.3x
1.7x
6.8x
1.1x
8.5x
88.7x
122.0x
55.9x
334.7x
38.0x
38.6x
28.8x
31.4x
32.8x
46.6x
75.2x
25.2%
14.1%
12.3%
30.2%
64.5%
25.5%
23.4%
-10.9%
13.8%
30.5%
63.7%
24.2%
22.6%
1.3%
18.1%
28.5%
56.3%
74.8%
21.0%
22.6%
1.3%
18.1%
28.5%
56.3%
74.8%
21.0%
20.8% -38.9% -35.3% -22.2% -22.2% -17.2%

1.3%
21.2%
3.5%
4.3%
5.0%
5.0%
5.0%
24.1% -33.2% -30.5% -27.0% -27.0% -26.3%
50.9% -39.1% -34.4% -31.0% -31.0% -31.9%
102.3% 8.6%
6.2%
-9.6%
-9.6% -11.8%
20.9%
8.5%
8.2%
10.8% 10.8% 11.3%
0.6x
0.5x
9.0x
52.2%
52.2%
43.8%
43.8%
MINDBODY
2Q15
9.3x
3.8x
2.9x
5.7x
8.4x
6.0x
2.1x
6.9x
10.0x
5.0x
11.0x
2.5x
2.2x
SEG SaaS Index

EV/EBITDA
3Q14
4Q14
1Q15
36.8x
27.0x
23.9x

2Q15
-21.9%
12.9%
-10.8%
-76.9%
-14.9%
7.8%
-11.3%
-34.7%
-61.9%
-2.5%
-150.6%
-31.1%
11.8%
-89.3%
25.1%
-18.0%
16.4%
-365.1%
-40.4%
-89.3%
25.1%
-18.0%
16.4%
-365.1%
-40.4%
-83.8%
25.9%
-16.0%
17.3%
-311.3%
-37.5%
-3.2%
-4.1%
-4.1%
-4.9%
3.6%
4.7%
4.7%
4.6%
41.5%
41.6%
41.6%
40.9%
-26.3% -26.3% -30.4% -30.4% -30.4%
65
THE SEG SaaS INDEX COMPANIES KEY METRICS

Company
Netsuite
New Relic
OPOWER
Paycom Software
Paylocity Holding
Q2 Holdings
Qualys
Rally Software Development
RealPage
RingCentral
Salesforce.com
SciQuest
Service-now.com
Shopify
SPS Commerce
Tableau Software
Tangoe
Textura
The Ultimate Software Group
TrueCar
Upland Software
Veeva Systems
Workday
Workiva
Xactly
Yodlee
Zendesk
Zix
2Q14
15.9x
12.1x
10.6x
6.7x
3.6x
6.4x
8.5x
7.4x
18.0x
8.0x
18.4x
3.6x
12.0x
8.7x
12.9x
30.0x
4.6x
EV/Revenue
3Q14
4Q14
1Q15
4.5x
4.4x
4.2x
54.7x
48.6x
61.3x
9.4x
8.3x
6.1x
5.2x
12.1x
10.4x
15.6x
8.0x
8.0x
9.2x
1.7x
1.8x
2.6x
0.3x
0.2x
0.3x
8.5x
7.8x
7.1x
63.4x
52.7x
56.6x
8.8x
3.2x
2.8x
63.3x
65.1x
72.5x
3.8x
3.6x
3.7x
61.1x
59.3x
79.7x
1.2x
1.0x
0.9x
2.5x
3.1x
2.8x
64.5x
61.5x
63.2x
3.5x
4.0x
4.5x
0.3x
24.2x
24.8x
29.2x
275.8x 307.7x 235.9x
6.0x
9.4x
2Q15
12.1x
12.0x
3.4x
12.1x
11.1x
9.2x
9.4x
3.7x
4.5x
8.6x
3.0x
15.1x
18.6x
7.2x
15.5x
2.2x
9.5x
8.8x
4.8x
2.1x
9.4x
17.1x
4.1x
5.2x
4.0x
11.8x
4.7x
2Q14
652.3x
60.3x
25.9x
442.7x
84.7x
316.7x
44.1x
58.9x
66.1x
18.7x
SEG SaaS Index

EV/EBITDA
3Q14
4Q14
1Q15
64.6x
67.4x
50.3x
58.4x
15.3x
24.4x
35.7x
473.8x 14.3x
9.8x
290.4x 155.2x 140.6x
650.4x 629.3x 700.5x
52.0x
46.2x
48.2x
8.2x
6.8x
6.4x
17.1x
18.2x
19.1x
56.6x
TTM Revenue Growth

2Q15
2Q14
3Q14
4Q14
1Q15
34.6% 33.4% 34.2% 34.2%
113.0%
82.2% 82.2%
64.2% 54.4% 44.8% 44.8%
68.7x
40.3% 40.3%
40.6% 41.2% 41.2%
39.1% 39.1%
49.3x 19.3% 20.4% 23.7% 23.7%
62.3x 15.4% 10.4%
7.3%
7.3%
38.3% 38.5% 37.0% 37.0%
201.0x 35.7% 37.3% 34.9% 32.0%
64.6x 30.6% 25.8% 13.0% 13.0%
69.3% 65.5% 60.7% 60.7%
111.9% 111.9% 109.0% 109.0%
70.3x 29.9% 24.8% 22.6% 22.6%
711.2x 86.6% 87.8% 77.5% 77.5%
28.5x 17.7% 14.4% 12.5% 12.5%
54.5% 54.5%
65.7x 23.2% 23.7% 23.3% 23.3%
54.3% 54.3%
118.8x
56.8% 56.8%
38.8x 58.3% 54.9% 54.4% 49.0%
74.1% 74.4% 72.2% 68.0%
32.3% 32.3%
30.0% 30.0% 30.0% 29.4%
27.0% 27.0%
76.3% 76.3%
27.6x
8.3%
6.5%
4.6%
4.6%

2Q15
34.2%
74.7%
35.7%
44.6%
40.9%
42.0%
24.0%
6.7%
36.8%
28.4%
7.9%
58.1%
24.1%
75.4%
10.9%
48.6%
22.2%
44.8%
38.1%
43.7%
63.7%
28.6%
26.2%
73.3%
5.6%
2Q14
-8.8%
-58.6%
-16.2%
10.6%
1.9%
-26.0%
11.1%
13.9%
-18.4%
-0.7%
1.7%
-13.1%
-5.6%
9.5%
5.8%
8.1%
-76.5%
14.8%
-10.9%
-17.5%
19.5%
-24.6%
-26.2%
-17.9%
6.2%
-27.3%
24.5%
EBITDA Margin
3Q14
4Q14
1Q15
-8.1%
-9.2%
-9.2%
-50.2% -40.8% -40.8%
-26.7% -29.7% -29.7%
11.8% 14.6% 14.6%
-1.9%
-7.3%
-7.3%
-24.8% -18.9% -18.9%
11.8% 15.8% 15.8%
10.8%
7.2%
7.2%
-20.5% -15.8% -15.8%
0.1%
1.7%
3.1%
2.9%
5.1%
5.1%
-15.5% -16.1% -16.1%
-5.6% -16.8% -16.8%
9.7%
10.3% 10.3%
5.0%
4.8%
4.8%
7.2%
7.7%
7.7%
-23.0% -27.0% -27.0%
14.5% 14.4% 14.4%
-16.1% -19.3% -19.3%
-15.7% -13.1% -13.1%
20.4% 21.8% 23.3%
-25.2% -22.7% -19.9%
-23.9% -30.8% -30.8%
-17.9% -17.9% -20.9%
7.0%
-1.9%
-1.9%
-38.8% -46.9% -46.9%
23.5% 16.6% 16.6%
2Q15
-8.3%
-40.7%
-30.4%
17.6%
-6.7%
-16.2%
19.0%
5.9%
-13.1%
4.3%
4.6%
-16.1%
-11.9%
10.2%
2.2%
7.7%
-18.8%
13.4%
-19.1%
1.8%
24.2%
-17.3%
-30.9%
-19.7%
-3.7%
-46.5%
16.9%
66
THE SEG SaaS INDEX METRICS BY PRODUCT CATEGORY

CRM & Marketing
EV/Revenue
EV/EBITDA
EV/Earnings
Gross Profit Margin
EBITDA Margin
Net Income Margin
Current Ratio
2Q14
3.1x
88.7x
73.4x
68.5%
-17.7%
-33.0%
30.2%
-18.4%
-25.5%
2.3
13.6%
9.7%
3Q14
5.0x
112.7x
398.0x
67.1%
-17.4%
-33.0%
29.6%
0.4%
16.5%
2.1
10.9%
0.0%
4Q14
4.7x
117.2x
283.9x
68.0%
-15.1%
-29.5%
28.5%
9.4%
98.4%
1.8
11.9%
5.4%
1Q15
6.6x
122.7x
294.2x
68.0%
-12.1%
-26.5%
28.5%
22.3%
98.4%
1.9
14.3%
-12.7%
2Q15
6.3x
123.8x
44.3x
68.3%
-11.3%
-18.0%
28.4%
1.5%
95.2%
2.1
15.6%
12.0%
ERP & Supply Chain

EV/Revenue
EV/EBITDA
EV/Earnings
Gross Profit Margin
EBITDA Margin
Net Income Margin
Current Ratio
2Q14
7.7x
84.7x
376.5x
67.7%
-8.8%
-17.9%
34.6%
-4.6%
164.5%
2.3
12.6%
18.2%
3Q14
6.1x
67.4x
257.2x
68.0%
-8.1%
-17.3%
30.2%
-4.9%
76.2%
2.1
13.2%
-14.0%
4Q14
5.5x
57.2x
159.3x
68.2%
-9.2%
-18.0%
27.0%
-38.9%
73.7%
2.1
13.2%
-5.7%
1Q15
5.7x
56.5x
167.8x
68.2%
-9.2%
-18.0%
27.0%
22.9%
73.7%
2.1
12.3%
-7.5%
2Q15
6.3x
64.6x
189.4x
68.2%
-8.3%
-16.8%
26.3%
34.4%
76.2%
2.7
12.0%
16.7%
Vertically Focused
EV/Revenue
EV/EBITDA
EV/Earnings
Gross Profit Margin
EBITDA Margin
Net Income Margin
Current Ratio
2Q14
9.9x
55.1x
75.3x
60.7%
8.6%
-1.1%
28.1%
-23.5%
-20.6%
2.2
10.0%
21.7%
3Q14
6.9x
39.1x
133.5x
59.5%
8.2%
-1.7%
30.1%
-16.2%
-23.0%
2.3
9.9%
19.9%
4Q14
5.8x
42.7x
71.6x
59.8%
7.2%
-2.5%
39.1%
4.3%
11.3%
2.9
10.3%
-6.6%
1Q15
6.4x
45.0x
76.4x
59.8%
7.2%
-2.5%
39.1%
5.7%
11.3%
2.9
9.4%
2.5%
2Q15
8.4x
42.2x
68.5x
60.4%
5.9%
-3.0%
38.5%
9.9%
73.0%
1.7
5.5%
29.7%
Human Capital Management

EV/Revenue
EV/EBITDA
EV/Earnings
Gross Profit Margin
EBITDA Margin
Net Income Margin
Current Ratio
2Q14
9.4x
58.9x
105.5x
59.5%
-5.3%
-15.8%
28.8%
-10.8%
28.5%
1.6
8.5%
16.1%
3Q14
7.2x
52.8x
119.4x
60.1%
-6.8%
-12.2%
30.9%
-21.7%
23.3%
1.4
7.4%
-16.1%
4Q14
6.6x
37.5x
88.7x
59.7%
-11.7%
-18.9%
30.6%
-29.6%
75.2%
1.3
8.4%
-18.8%
1Q15
6.7x
55.9x
91.2x
59.7%
-11.7%
-18.9%
30.3%
-32.0%
75.2%
1.3
11.8%
-10.0%
2Q15
6.5x
65.7x
111.1x
59.8%
-11.3%
-18.7%
33.9%
-47.3%
41.6%
1.4
8.8%
34.1%
Other SaaS
EV/Revenue
EV/EBITDA
EV/Earnings
Gross Profit Margin
EBITDA Margin
Net Income Margin
Current Ratio
2Q14
5.5x
47.4x
194.1x
71.9%
-13.1%
-21.7%
35.9%
-9.1%
-6.2%
2.5
12.6%
25.6%
3Q14
4.5x
41.5x
208.6x
72.5%
-15.7%
-24.5%
26.2%
-46.4%
-12.6%
2.2
11.9%
3.8%

4Q14
3.9x
32.0x
46.4x
65.1%
-16.1%
-23.4%
37.0%
-66.3%
-17.0%
3.0
12.2%
-3.4%
1Q15
4.6x
38.9x
42.3x
65.1%
-16.1%
-23.4%
37.0%
-42.2%
-17.0%
3.0
11.6%
-18.8%
2Q15
9.4x
50.0x
39.1x
66.5%
-13.1%
-19.4%
36.8%
-34.4%
-3.2%
2.2
12.2%
28.7%
67
THE SEG INTERNET INDEX COMPANIES KEY METRICS

SEG Internet Index
Company
EV/Revenue
EV/EBITDA
2Q14
3Q14
4Q14
1Q15
2Q15
2Q14
3Q14
1-800-FLOWERS.COM
58.com
8x8
Akamai Technologies
Alibaba
Amazon.com
Angie's List
Baidu.com
Bankrate
Baozun
Bitauto Holdings
BlueNile
Brightcove
BroadSoft
Carbonite
Care.com
ChangYou.com
Chegg
Cimpress
Coupons.com
Criteo SA
Ctrip
DangDang
DemandMedia
eBay
eHealth
Envivio
Everyday Health
Expedia
Facebook
GeekNet
Giant Interactive
GoDaddy
Google
Groupon
GrubHub
0.5x
20.6x
6.2x
6.0x
1.9x
2.6x
9.5x
3.8x
5.8x
0.7x
2.4x
3.8x
1.9x
6.9x
2.0x
3.0x
1.5x
9.6x
3.0x
6.8x
0.9x
2.7x
4.0x
4.6x
0.9x
2.9x
2.1x
16.8x
0.3x
60.6x
5.7x
1.6x
-
0.5x
15.7x
4.3x
5.4x
1.7x
2.2x
8.4x
3.6x
5.1x
0.7x
2.2x
3.3x
1.8x
2.6x
1.7x
1.8x
1.2x
7.7x
2.1x
6.7x
0.6x
0.9x
3.6x
3.2x
0.5x
3.9x
1.8x
14.5x
0.3x
25.7x
4.9x
1.2x
12.4x
0.3x
15.1x
3.4x
5.4x
19.5x
1.7x
1.3x
9.1x
3.1x
7.5x
0.6x
1.4x
2.8x
1.8x
1.5x
1.5x
2.4x
1.2x
4.4x
1.7x
7.0x
0.7x
0.7x
3.5x
2.2x
0.3x
2.7x
1.8x
14.5x
0.3x
11.9x
5.2x
1.1x
10.6x
0.5x
11.5x
3.3x
5.5x
22.4x
1.6x
1.2x
9.7x
2.4x
7.5x
0.8x
1.5x
3.3x
1.9x
1.3x
1.6x
1.9x
1.9x
4.6x
2.2x
6.2x
0.5x
0.4x
3.6x
2.0x
0.0x
2.1x
1.8x
15.8x
0.2x
8.8x
4.8x
1.3x
10.3x
0.7x
27.5x
3.7x
6.5x
16.9x
2.2x
1.1x
8.0x
2.5x
1.9x
6.4x
0.6x
1.6x
4.1x
1.9x
1.1x
2.0x
1.9x
2.0x
3.8x
2.7x
7.9x
0.4x
0.4x
3.9x
1.0x
0.3x
2.6x
2.3x
16.0x
0.1x
12.1x
2.0x
4.6x
1.1x
10.9x
9.5x
133.0x
94.1x
16.9x
40.1x
23.4x
17.2x
28.0x
20.5x
24.1x
6.6x
41.4x
13.9x
48.0x
45.0x
12.7x
13.5x
198.0x
34.5x
15.6x
32.1x
63.0x
16.6x
35.8x
-
Harmonic
1.2x
1.2x
1.0x
1.2x
1.2x
20.9x
4Q14
TTM Revenue Growth

2Q15
2Q14
3Q14
8.0x
3.4x
6.1x
108.3x 326.1x 247.8x
93.8x
57.9x
55.7x
15.3x
15.5x
15.7x
46.4x
53.5x
35.5x
35.2x
33.3x
22.0x
26.7x
28.4x
16.3x
16.5x
12.9x
21.7x
31.0x
31.1x
19.0x
17.4x
23.6x
634.3x 32.4x
38.2x
25.3x
48.1x
51.8x
10.4x
15.3x
16.3x
44.1x
30.5x
24.4x
9.1x
8.5x
12.8x
27.9x
20.8x
26.3x
54.2x 1806.1x 1611.4x
112.6x 46.2x
34.9x
10.6x
8.8x
5.3x
12.4x
12.6x
12.9x
69.8x 517.3x 478.4x
43.5x
24.0x
19.0x
12.9x
13.7x
14.1x
26.7x
29.0x
31.7x
16.5x
16.1x
14.7x
32.8x
38.3x
45.5x
56.9x
40.7x
39.5x
7.8x
68.8x
19.2x
46.5x
41.5x
84.5x
24.7x
14.0x
34.1x
17.9x
32.5x
9.7x
34.9x
13.5x
32.2x
95.6x
15.7x
13.7x
27.0x
29.5x
18.6x
34.5x
33.4x
29.0x
14.3x
33.7x
39.6x
1.2%
86.4%
23.9%
16.9%
52.1%
22.1%
50.5%
47.7%
10.0%
59.4%
38.9%
10.3%
25.4%
10.0%
24.2%
11.6%
19.1%
6.5%
61.7%
31.7%
23.6%
-61.0%
13.9%
15.7%
33.2%
17.1%
17.3%
62.4%
16.9%
10.5%
13.6%
-
2.8%
86.7%
27.3%
19.9%
22.3%
43.2%
52.8%
20.3%
59.4%
43.7%
5.0%
22.8%
12.8%
20.8%
41.1%
5.3%
16.8%
8.8%
60.8%
34.3%
25.6%
21.6%
13.5%
14.4%
29.9%
19.5%
63.7%
14.1%
21.1%
17.6%
-
23.1x
26.4x
0.8%
-3.0%
24.2x
1Q15
27.2x
4Q14
1Q15
EBITDA Margin
2Q15
2Q14
3Q14
4Q14
1Q15
2Q15
36.3% 45.6% 45.6%

5.2%
5.9%
10.1%
8.8%
8.8%
81.8% 81.8% 78.4% 15.5% 14.5%
4.6%
4.6% -15.5%
28.2% 28.2% 26.3%
6.6%
4.6%
5.9%
5.9%
5.3%
24.5% 24.5% 22.5% 35.5% 35.1% 34.8% 34.8% 34.0%
44.1% 44.1% 45.1% 53.0% 51.6% 41.9% 41.9% 36.3%
19.5% 19.5% 17.7%
4.9%
4.9%
4.9%
4.9%
5.3%
28.2% 28.2% 22.5% -7.3%
-8.7%
-1.4%
-1.4%
1.3%
53.6% 53.6% 47.4% 40.5% 38.4% 34.2% 34.2% 32.3%
19.3% 19.3% 13.5% 22.3% 22.0% 18.7% 18.7% 18.2%
4.1%
4.1%
-2.2%
-2.2%
-2.8%
-2.8%
-2.2%
70.8% 70.8% 80.7% 20.9% 23.5% 24.1% 24.1% 18.7%
5.0%
5.2%
4.3%
3.6%
3.6%
3.6%
3.3%
3.4%
13.8% 13.8%
9.0%
-0.9%
-1.0%
-3.1%
-3.1%
-2.4%
21.5% 21.5% 25.1% -1.8%
0.5%
8.7%
8.7%
12.7%
14.4% 14.4% 13.1%
7.8%
7.2%
3.7%
3.7%
-0.2%
43.2% 42.9% 42.9% -29.3% -30.5% -27.0% -23.1% -23.1%
2.4%
2.4%
5.7%
29.8% 16.5% 10.0% 10.0% 20.9%
19.3% 19.3% 17.2%
7.2%
4.0%
7.8%
7.8%
5.4%
15.2% 15.2% 19.8% 10.9% 13.0% 14.6% 14.6% 14.9%
32.1% 32.1% 23.5% -5.1%
-6.8%
-8.3%
-8.3%
-6.0%
67.8% 67.8% 70.3%
6.2%
7.5%
8.2%
8.2%
8.5%
36.4% 36.4% 39.1% 15.0% 12.3%
0.4%
0.4%
-2.6%
25.8% 25.8% 25.4% -0.8%
0.6%
1.4%
1.4%
0.4%
-17.7% -17.7% 4.4%
21.0%
8.6%
8.3%
8.3%
2.7%
11.6% 11.6%
9.2%
29.6% 29.2% 28.1% 28.1% 28.2%
0.3%
0.3%
1.7%
2.3%
4.6%
0.4%
0.4%
3.6%
7.5%
-3.8%
-3.4% -19.8% -23.4% -28.8% -24.5% -15.5%
18.3% 18.3% 15.4%
8.5%
8.9%
11.1% 11.1%
8.7%
20.8% 20.8% 19.7% 13.2% 13.8% 13.1% 13.1% 12.4%
58.4% 58.4% 51.5% 52.3% 54.4% 49.9% 49.9% 46.6%
1.8%
1.8%
-3.0%
0.4%
-1.2%
-4.8%
-4.8%
-6.0%
708.3% 708.3% 328.6%
-7.5%
-7.5% 36.2%
22.7% 22.7% 21.5%
0.8%
1.0%
6.2%
6.2%
6.9%
18.9% 18.9% 17.0% 34.3% 29.8% 32.5% 32.5% 32.3%
24.0% 24.0% 19.0%
4.5%
3.5%
2.8%
2.8%
3.2%
85.1% 85.1% 66.8% 23.4% 21.8% 26.2% 26.2% 27.4%
-6.1%

-6.1%
-8.3%
5.6%
5.2%
4.3%
4.3%
4.7%
68

SEG Internet Index
Company
EV/Revenue
EV/EBITDA
2Q14
3Q14
4Q14
1Q15
2Q15
HomeAway
Interactive Intelligence
InterActiveCorp
LendingClub
LifeLock
Limelight Networks
LinkedIn
Liquidity Services
Mail.ru Group
MakeMyTrip
Marchex
MaxPoint Interactive
Mecox Lane
Mercadolibre
Mitel Networks
MOL Global
Monster Worldwide
NCSoft
Netease
Netflix
Orbitz
Overstock.com
Pandora
Perfect World
PetMed Express
Polycom
Priceline
Qihoo
QuinStreet
ReachLocal
Renren
Rocket Fuel
Rovi
SeaChange International
ShoreTel
Shutterfly
8.5x
4.4x
1.8x
3.7x
0.6x
12.1x
1.2x
9.3x
4.0x
2.6x
1.0x
8.3x
2.0x
1.0x
5.1x
4.0x
4.6x
1.4x
0.3x
8.1x
1.3x
1.0x
1.2x
8.5x
14.8x
0.8x
0.4x
2.3x
5.1x
5.4x
1.7x
1.6x
1.8x
6.5x
3.1x
1.8x
2.4x
0.6x
9.5x
0.8x
7.0x
3.6x
2.3x
0.5x
7.2x
1.7x
0.9x
4.1x
4.0x
4.3x
1.3x
0.2x
6.1x
0.9x
1.0x
1.1x
7.7x
10.8x
0.7x
0.2x
2.0x
2.7x
5.3x
1.5x
1.1x
1.7x
5.9x
2.4x
1.8x
2.3x
0.8x
10.5x
0.8x
10.1x
3.8x
1.7x
0.9x
8.3x
1.1x
0.9x
2.9x
4.3x
4.8x
1.3x
0.2x
5.6x
1.2x
1.0x
1.1x
7.1x
8.0x
0.6x
0.2x
2.4x
1.0x
5.3x
1.2x
1.0x
2.0x
5.5x
2.6x
1.7x
2.8x
1.0x
11.2x
0.6x
7.7x
3.7x
0.5x
0.7x
10.1x
1.1x
8.6x
0.7x
2.9x
5.1x
3.9x
1.3x
0.3x
4.0x
1.2x
1.0x
1.1x
6.6x
6.0x
0.6x
0.1x
2.9x
1.3x
5.0x
1.0x
1.2x
1.8x
5.2x
2.6x
2.0x
2.3x
1.9x
10.4x
0.4x
9.1x
2.4x
0.7x
1.8x
0.6x
10.6x
1.1x
2.1x
1.0x
3.7x
7.0x
6.3x
1.6x
0.3x
3.5x
1.0x
1.3x
1.0x
7.2x
5.1x
0.8x
0.1x
8.4x
0.8x
4.5x
1.2x
1.0x
1.9x
Shutterstock
9.6x
8.1x
7.5x
7.1x
5.8x
2Q14
TTM Revenue Growth
4Q14
1Q15
52.6x
39.6x
74.4x 112.0x
10.0x
10.2x
51.6x
36.5x
122.3x 89.7x
8.2x
6.1x
21.0x
15.5x
55.6x
41.7x
2.0x
23.5x
20.1x
16.9x
14.6x
8.2x
8.4x
16.6x
13.7x
8.3x
8.4x
61.7x
50.6x
9.4x
8.6x
9.8x
14.4x
6.3x
4.2x
7.7x
7.8x
12.2x
10.5x
22.4x
20.1x
49.9x
40.8x
11.1x
18.9x
62.8x
15.3x
15.0x
1142.6x
35.8x
20.0x
18.2x
17.1x
40.4x
11.3x
29.4x
99.9x
7.7x
20.8x
36.0x
5.4x
24.9x
8.1x
9.9x
7.7x
10.2x
57.6x
8.6x
12.6x
6.9x
8.1x
9.3x
18.2x
32.1x
15.5x
15.1x
20.5x
37.5x
37.7x 26.0% 28.8% 28.9% 28.9% 23.5% 16.1% 16.3% 14.6%
1017.8x 25.8% 17.4%
7.2%
7.2%
8.3%
5.9%
2.8%
-0.2%
11.0x
14.0x
4.1%
-1.4%
2.9%
2.9%
4.0%
17.5% 17.3% 15.6%
168.6% 150.5% 115.4% 115.4% 110.5%
35.5x
35.5x 31.3% 30.6% 28.8% 28.8% 27.3%
7.1%
6.6%
7.8%
-7.1%
-7.0%
-6.4%
-6.4%
-3.2%
-7.0%
-5.6%
-3.5%
107.0x 103.1x 51.3% 48.5% 45.2% 45.2% 42.1%
9.9%
10.6% 10.5%
6.0x
5.2x
1.5%
1.5%
-1.3%
-1.3%
-6.0% 15.0% 13.1%
9.7%
15.8x
18.7x 26.8% 24.5% 19.5% 19.5% 19.5% 44.4% 45.5% 48.6%
11.6% 12.9% 16.9% 16.9% 17.3% -5.1%
-3.5%
-2.8%
10.0x
10.3x 27.5% 30.3% 19.7% 19.7%
3.8%
4.6%
5.4%
4.8%
61.1% 61.1% 70.2% -1.4%
-4.8%
-8.5%
4.4x
4.3x
-76.4% -36.6% 16.4% 16.4% 61.3% 52.6% -7.0% 17.1%
30.0x
31.7x 23.6% 21.4% 17.8% 17.8% 21.4% 35.4% 35.9% 33.6%
8.0x
8.6x
106.0% 106.0% 75.1% 11.6% 11.3% 13.6%
724.5x
18.2% 18.2% 16.5% 24.7% 23.9%
1.2%
8.2x
9.9x
-8.6% -6.6% -4.7% -4.7% -4.8% 12.7% 11.0%
8.9%
7.9x
10.0x
-5.9%
-8.4% 10.8% 10.8% 13.2% 30.5% 30.1% 37.3%
12.0x
17.9x 12.2% 14.1% 27.4% 27.4% 38.2% 48.5% 47.0% 42.2%
46.4x
79.7x 22.8% 24.0% 25.8% 25.8% 25.7%
7.4%
8.5%
8.3%
8.5x
12.8x
7.9%
7.3%
10.0% 10.0% 10.2% 14.9% 14.9% 15.0%
18.9x
17.4x 16.1% 14.2% 14.8% 14.8% 16.6%
2.6%
1.3%
1.7%
40.6% 40.6% 30.4% -1.0%
-1.4%
-1.7%
6.9x
5.9x
24.5% 30.9% 25.9% 25.9% 25.9% 20.5% 21.0% 17.2%
7.6x
9.6x
2.4%
-0.6%
-3.3%
-3.3%
-1.7% 12.5% 12.7% 12.9%
9.2x
8.4x
-2.0% -2.0% -1.7% -1.7% -0.8%
9.7%
10.4% 11.9%
17.0x
18.8x 29.1% 28.9% 24.3% 24.3% 21.1% 37.7% 38.2% 38.9%
24.3x
19.6x 123.6% 121.3% 107.2% 107.2% 82.7% 29.7% 26.6% 24.8%
-7.7%
-7.4%
-7.6%
-7.6%
-4.1%
7.3%
3.9%
-0.6%
9.4%
5.5%
-7.6%
-7.6% -13.0% 0.7%
-1.5%
-7.0%
-23.2% -40.9% -43.9% -43.9% -43.5% -64.8% -81.4% -108.3%
115.9% 97.4% 69.8% 69.8% 58.5% -4.8%
-5.5%
-9.2%
14.5x
13.6x 11.8% 19.6%
0.9%
0.9%
-2.4% 35.2% 35.3% 34.3%
-13.5% -18.6% -22.9% -21.1% -15.4% 0.1%
-5.0% -10.1%
17.5x
16.4x
9.9%
8.4%
5.9%
5.9%
5.4%
4.4%
5.6%
6.7%
18.1x
20.4x 20.7% 18.4% 17.6% 17.6% 17.5%
9.8%
9.9%
9.8%
52.5x
49.6x
52.4x
49.9x
2Q15
43.6x
2Q14
40.4%
3Q14
40.8%
4Q14
39.3%

1Q15
EBITDA Margin
3Q14
39.3%
2Q15
37.2%
2Q14
18.3%
3Q14
16.3%
4Q14
14.2%
1Q15
2Q15
14.6%
-0.2%
15.6%
7.8%
-3.5%
10.5%
9.7%
48.6%
-2.8%
4.8%
-8.5%
17.1%
33.6%
13.6%
1.2%
8.9%
37.3%
42.2%
8.3%
15.0%
1.7%
-1.7%
17.2%
12.9%
11.9%
38.9%
24.8%
-0.6%
-7.0%
-108.3%
-9.2%
34.3%
-12.1%
6.7%
9.8%
13.7%
0.3%
14.1%
6.4%
-3.9%
10.1%
8.6%
48.6%
-3.4%
6.7%
-9.7%
13.2%
33.3%
13.1%
-13.4%
9.6%
36.9%
39.3%
7.9%
12.4%
1.5%
-3.6%
17.2%
13.1%
12.3%
38.1%
25.9%
-1.4%
-8.3%
-125.9%
-12.4%
33.0%
-12.1%
6.3%
9.2%
14.2%
13.4%
69

SEG Internet Index
Company
EV/Revenue
EV/EBITDA
TTM Revenue Growth
EBITDA Margin
2Q14
3Q14
4Q14
1Q15
2Q15
2Q14
3Q14
4Q14
1Q15
2Q15
2Q14
3Q14
4Q14
1Q15
2Q15
2Q14
3Q14
4Q14
1Q15
2Q15
SINA
5.0x
3.5x
2.6x
1.7x
1.9x
58.7x
37.5x
107.0x
69.2x
299.1x
29.4%
28.7%
15.5%
15.5%
10.0%
8.5%
9.3%
2.5%
2.5%
0.6%
Sohu.com
1.4x
1.2x
1.1x
1.0x
1.3x
10.7x
18.8x
31.9x
29.5x
17.9x
27.0%
23.4%
19.5%
19.5%
20.9%
13.4%
6.3%
3.3%
3.3%
7.5%
Sonus Networks
2.3x
2.3x
2.7x
2.8x
1.1x
145.4x
295.8x
245.0x
9.8%
7.2%
7.1%
-3.0%
-3.0%
1.6%
0.8%
1.1%
-4.6%
-4.6%
Stamps.com
3.7x
3.5x
3.2x
4.7x
6.8x
13.3x
12.5x
12.2x
18.1x
26.3x
8.0%
6.4%
15.2%
15.2%
22.5%
28.3%
27.7%
26.2%
26.2%
25.6%
Synacor
0.3x
0.3x
0.3x
0.2x
0.3x
26.5x
58.5x
-10.4%
-9.4%
-4.7%
-4.7%
0.1%
1.2%
-0.9%
-1.3%
-1.3%
0.5%
Tencent Holdings
12.4x
11.0x
11.6x
10.9x
13.9x
36.8x
31.2x
29.7x
28.1x
33.9x
36.6%
36.8%
30.6%
30.6%
27.0%
33.7%
35.4%
39.0%
39.0%
41.0%
The Rubicon Project
5.0x
2.5x
3.0x
4.3x
49.5%
49.5%
54.5%
-3.1%
-8.1%
-8.7%
-8.7%
-7.2%
TheStreet.com
0.6x
0.5x
0.4x
0.4x
0.5x
670.6x
11.4%
11.7%
12.1%
12.1%
13.0%
-0.5%
-0.2%
-1.1%
-1.1%
0.1%
Travelzoo
1.8x
1.4x
1.4x
0.9x
0.9x
10.7x
8.8x
12.2x
8.3x
10.1x
1.5%
-2.7%
-10.2% -10.2% -11.4%
16.5%
16.2%
11.2%
11.2%
9.2%
Tree.Com
1.8x
1.4x
1.4x
2.4x
3.3x
26.6x
17.7x
21.0x
35.2x
38.9x
63.8%
38.3%
20.2%
20.2%
17.9%
6.7%
7.8%
6.8%
6.8%
Tremor
0.8x
0.8x
0.4x
0.3x
0.4x
25.9%
22.1%
21.0%
21.0%
16.4%
-6.5%
-9.5%
-10.4% -10.4%
-9.7%
TripAdvisor
13.5x
11.6x
11.0x
8.5x
8.6x
41.9x
37.6x
36.7x
28.3x
30.6x
23.1%
24.7%
31.9%
31.9%
33.3%
32.3%
31.0%
30.1%
30.1%
28.1%
TubeMogul
2.5x
3.9x
3.6x
99.7%
99.7%
75.9%
-6.5%
-0.8%
-0.9%
-0.9%
-5.0%
Tucows
1.0x
1.1x
1.1x
1.2x
1.4x
13.9x
13.2x
12.5x
13.2x
12.6x
14.7%
15.5%
13.6%
13.6%
14.4%
7.2%
8.0%
9.0%
9.0%
11.0%
Twitter
32.0x
21.4x
18.1x
16.4x
14.1x
112.5% 117.3% 111.0% 111.0%
98.3%
-78.8% -74.6% -24.7% -24.7% -21.1%
VeriSign
7.0x
6.3x
6.7x
6.9x
7.3x
11.5x
10.3x
10.7x
11.1x
11.8x
8.1%
6.3%
4.7%
4.7%
4.3%
61.0%
61.5%
62.2%
62.2%
62.0%
WebMD Health
2.4x
3.2x
2.9x
2.7x
3.2x
15.0x
17.6x
14.6x
14.1x
15.8x
12.8%
12.9%
12.6%
12.6%
10.0%
16.2%
18.0%
19.5%
19.5%
20.4%
Wix.com
8.0x
5.3x
3.9x
4.7x
5.3x
88.5%
85.3%
76.3%
76.3%
67.9%
-37.2% -40.0% -37.4% -37.4% -35.0%
-17.0% -17.0%
Wowo Limited
8.6%
15.2x
-2.0%
-95.4% -130.8% -139.0% -139.0% -121.9%
XO Group
1.4x
1.6x
1.7x
2.1x
2.5x
11.7x
15.5x
14.2x
17.8x
19.0x
4.9%
4.7%
7.4%
7.4%
5.8%
11.7%
10.6%
11.7%
11.7%
Xoom
3.8x
4.6x
4.2x
2.6x
3.2x
42.7x
69.6x
66.9x
42.4x
60.3x
53.1%
40.4%
30.2%
30.2%
25.2%
8.9%
6.5%
6.2%
6.2%
5.3%
Xunlei
3.8x
2.6x
0.8x
1.2x
19.3x
14.8x
4.6x
8.0x
2.8%
2.8%
6.7%
28.0%
19.8%
17.7%
17.7%
15.4%
Yahoo!
7.4x
7.2x
7.7x
8.2x
7.6x
39.0x
43.1x
51.9x
55.4x
59.9x
-4.7%
-4.2%
-1.3%
-1.3%
0.8%
19.0%
16.7%
14.8%
14.8%
12.7%
Yandex
8.0x
7.2x
11.5x
10.0x
6.5x
20.6x
19.0x
30.6x
26.6x
17.9x
37.2%
36.2%
28.5%
28.5%
23.2%
39.0%
37.8%
37.5%
37.5%
36.4%
Yelp
20.3x
14.3x
13.3x
10.2x
7.5x
3906.2x 654.7x
203.5x
156.0x
110.6x
68.4%
66.2%
62.0%
62.0%
59.4%
0.5%
2.2%
6.5%
6.5%
6.8%
Youku
8.1x
6.3x
5.0x
3.2x
4.4x
50.5x
41.9x
41.2x
26.6x
48.9x
63.0%
46.7%
37.6%
37.6%
37.9%
16.0%
15.1%
12.2%
12.2%
9.1%
YuMe
1.2x
0.9x
0.7x
0.6x
0.6x
71.2x
114.1x
31.2%
26.8%
17.6%
17.6%
11.6%
1.6%
0.8%
-2.6%
-2.6%
-2.7%
YY
11.9x
7.8x
6.9x
6.4x
4.9x
38.7x
24.4x
21.7x
20.3x
16.9x
117.8% 113.7% 101.7% 101.7%
91.4%
30.8%
31.9%
31.5%
31.5%
29.0%
Zillow
14.8x
15.3x
15.5x
12.3x
13.1x
69.1%
65.0%
72.1%
-2.9%
-1.9%
-0.8%
-0.8%
-1.3%
Zynga
3.5x
3.3x
2.8x
2.1x
2.4x
1047.6x
-36.5% -37.6% -20.9% -20.9%
-9.3%
0.3%
-6.3%
-15.2% -15.2% -11.8%
68.6%
65.0%

12.9%
70
THE SEG INTERNET INDEX METRICS BY PRODUCT CATEGORY

Ad Tech
EV/Revenue
EV/EBITDA
EV/Earnings
Gross Profit Margin
EBITDA Margin
Net Income Margin
Current Ratio
2Q14
2.7x
37.0x
28.2x
56.1%
3.1%
-1.2%
27.5%
-1.6%
10.1%
3.1
18.4%
27.1%
3Q14
2.0x
27.9x
33.3x
54.8%
3.1%
-1.8%
26.8%
-14.2%
13.6%
3.4
20.2%
-13.2%
4Q14
2.2x
26.6x
29.7x
54.7%
1.2%
-7.2%
24.8%
-59.4%
26.3%
2.2
17.7%
-37.6%
1Q15
2.5x
26.1x
21.6x
54.7%
1.2%
-7.2%
24.8%
-52.7%
26.3%
2.2
18.7%
-31.1%
2Q15
2.3x
17.9x
21.5x
53.2%
2.0%
-7.8%
22.1%
-34.0%
19.0%
3.1
21.5%
-11.7%
Infrastructure
EV/Revenue
EV/EBITDA
EV/Earnings
Gross Profit Margin
EBITDA Margin
Net Income Margin
Current Ratio
2Q14
2.0x
20.8x
32.1x
61.5%
5.0%
-3.2%
10.0%
0.4%
61.5%
2.4
19.6%
21.4%
3Q14
1.5x
17.9x
32.9x
61.1%
3.7%
-4.7%
10.6%
2.9%
41.1%
2.4
15.8%
4.6%
4Q14
1.2x
15.7x
32.2x
61.5%
6.0%
-4.5%
7.2%
18.7%
13.8%
2.3
17.0%
-4.4%
1Q15 2Q15
1.3x
1.5x
15.8x 19.2x
34.4x 39.2x
61.5% 61.6%
6.0% 5.8%
-7.0% -4.2%
5.3% 4.9%
10.6% 11.7%
13.8% -4.2%
2.3
2.5
15.5% 18.9%
-1.7% -4.8%
Commerce
EV/Revenue
EV/EBITDA
EV/Earnings
Gross Profit Margin
EBITDA Margin
Net Income Margin
Current Ratio
2Q14
1.1x
19.1x
28.1x
40.7%
9.8%
1.9%
16.5%
7.4%
31.5%
1.5
12.3%
-0.8%
3Q14
1.2x
25.7x
36.7x
40.1%
5.4%
2.1%
14.2%
8.0%
21.4%
1.5
14.2%
-10.6%
4Q14
1.5x
24.4x
44.8x
39.1%
6.4%
0.4%
17.1%
4.3%
-7.6%
1.6
15.8%
-6.2%
1Q15
1.6x
24.2x
33.2x
39.1%
6.4%
0.4%
17.1%
-1.8%
-8.1%
1.6
14.1%
-2.6%
2Q15
1.9x
26.3x
38.8x
40.1%
5.3%
-0.1%
17.7%
-7.3%
-7.2%
1.6
12.6%
21.4%
Search
EV/Revenue
EV/EBITDA
EV/Earnings
Gross Profit Margin
EBITDA Margin
Net Income Margin
Current Ratio
2Q14
6.7x
18.3x
24.4x
69.2%
36.7%
26.8%
23.9%
3.1%
33.3%
4.2
14.7%
30.3%
3Q14
6.2x
18.3x
27.4x
66.8%
33.8%
24.9%
28.7%
5.5%
13.6%
4.1
14.2%
36.4%
4Q14
7.2x
20.6x
25.8x
70.2%
33.4%
24.4%
23.7%
0.0%
25.8%
3.5
14.3%
14.5%
1Q15
5.5x
15.6x
20.2x
70.2%
33.4%
24.4%
23.7%
-0.3%
25.8%
3.5
14.3%
-4.8%
2Q15
5.6x
16.1x
21.1x
70.1%
32.3%
23.3%
20.1%
-3.2%
18.7%
3.5
13.7%
7.8%
Content & Media

EV/Revenue
EV/EBITDA
EV/Earnings
Gross Profit Margin
EBITDA Margin
Net Income Margin
Current Ratio
2Q14
3.6x
20.1x
76.1x
59.8%
16.2%
3.5%
12.8%
29.6%
-22.2%
3.5
26.5%
37.9%
3Q14
2.7x
16.7x
44.4x
52.3%
15.1%
5.4%
12.9%
33.9%
-26.7%
3.5
21.3%
27.6%
4Q14 1Q15 2Q15

2.7x
2.8x
2.8x
17.8x 21.6x 31.3x
13.3x 13.0x 35.3x
59.8% 59.8% 56.0%
12.2% 12.2% 12.7%
6.0%
6.0%
4.1%
12.1% 12.1% 10.0%
-4.7% -10.2% -21.3%
45.2% 45.2% 45.8%
3.8
3.8
2.9
23.8% 18.3% 18.7%
-2.3% -21.2% -7.4%
Services
EV/Revenue
EV/EBITDA
EV/Earnings
Gross Profit Margin
EBITDA Margin
Net Income Margin
Current Ratio
2Q14
3Q14 4Q14 1Q15
3.2x
2.4x
2.3x
2.5x
24.2x
26.4x 29.8x 24.7x
84.8x
74.0x 43.0x 47.4x
72.4% 73.0% 73.0% 73.0%
7.5%
6.9% 6.5% 6.5%
-1.6%
-3.8% -7.6% -7.6%
27.8% 34.5% 28.2% 28.2%
31.7% 17.8% 9.8% 3.3%
159.9% 401.6% 123.5% 123.5%
2.7
2.6
2.8
2.8
13.4% 14.9% 17.1% 17.5%
18.8% -8.2% -14.5% -24.8%
2Q15
2.4x
28.3x
36.4x
72.4%
5.9%
-5.9%
22.5%
13.2%
162.6%
2.6
18.2%
0.2%
Gaming
EV/Revenue
EV/EBITDA
EV/Earnings
Gross Profit Margin
EBITDA Margin
Net Income Margin
Current Ratio
2Q14
3.6x
9.2x
8.7x
70.3%
29.8%
18.8%
12.2%
-20.0%
19.8%
2.0
25.2%
27.8%
3Q14
2.8x
10.2x
11.8x
69.0%
21.0%
16.5%
14.1%
-14.7%
15.9%
1.8
32.5%
-6.5%
4Q14
2.5x
14.2x
11.6x
70.2%
13.6%
5.9%
22.7%
3.8%
25.9%
2.5
32.1%
-24.8%
Social
EV/Revenue
EV/EBITDA
EV/Earnings
Gross Profit Margin
EBITDA Margin
Net Income Margin
Current Ratio
2Q14
3Q14 4Q14 1Q15
10.5x
12.6x 10.2x
8.5x
31.1x
33.1x 31.7x 32.7x
20.7x
20.4x 22.2x 18.6x
61.8% 63.0% 68.2% 68.2%
9.9%
10.6% 10.5% 10.5%
21.6% 23.8% 23.6% 23.6%
62.4% 63.7% 58.4% 58.4%
7.5%
19.2% 39.4% 39.8%
299.4% 222.7% 109.4% 109.4%
9.6
6.7
9.6
9.6
11.4% 13.4% 12.8% 12.1%
n/a
n/a
n/a -14.3%
2Q15
9.1x
34.5x
77.1x
68.3%
10.1%
9.0%
51.5%
44.5%
65.8%
8.3
12.6%
22.5%
1Q15
2.8x
15.9x
13.1x
70.2%
13.6%
5.9%
22.7%
-2.7%
25.9%
2.5
27.9%
-15.0%
2Q15
3.1x
17.9x
18.7x
70.1%
28.6%
10.2%
23.4%
-2.7%
8.7%
2.4
25.0%
20.4%
Travel
EV/Revenue
EV/EBITDA
EV/Earnings
Gross Profit Margin
EBITDA Margin
Net Income Margin
Current Ratio

2Q14
5.4x
21.6x
51.4x
83.2%
15.6%
5.5%
20.2%
-0.7%
33.6%
1.8
21.2%
41.2%
3Q14
5.4x
20.7x
60.4x
83.0%
15.6%
5.1%
22.1%
2.2%
24.4%
1.7
18.2%
35.2%
4Q14
4.6x
17.1x
46.9x
82.8%
13.8%
5.1%
22.5%
17.5%
-7.0%
1.7
18.8%
5.6%
1Q15 2Q15
4.2x
3.8x
17.1x 18.7x
51.1x 51.6x
82.8% 82.2%
13.8% 12.4%
5.1%
4.6%
22.5% 20.4%
12.5% 8.9%
-7.0% -27.3%
1.7
1.9
22.1% 17.2%
2.4% -2.3%
71
Select PUBLIC SELLERS

Date
06/17/15
04/07/15
06/15/15
05/07/15
06/23/15
06/15/15
06/29/15
05/04/15
06/01/15
05/15/15
04/12/15
06/24/15
06/09/15
Buyer
CITIC Securities Company Limited (SHSE:600030)
Permira Advisers; Canada Pension Plan Investment
Equinix, Inc. (NasdaqGS:EQIX)
Huatai Ruilian Fund Management Co., Ltd.
Accel Partners; IDG Capital Partners
Ciena Corporation (NYSE:CIEN)
Orient Securities Co., Ltd.
Gravity4, Inc.
Avid Technology, Inc. (NasdaqGS:AVID)
Hikari Tsushin, Inc. (TSE:9435)
Perfect Commerce Holdings, LLC
Seller
Qihoo 360 Technology Co. Ltd. (NYSE:QIHU)
Telecity Group plc (LSE:TCY)
Momo Inc. (NasdaqGS:MOMO)
iDreamSky Technology Limited (NasdaqGS:DSKY)
Kongzhong Corp. (NasdaqGS:KZ)
Cyan, Inc. (NYSE:CYNI)
Taomee Holdings Ltd. (NYSE:TAOM)
Orad Hi Tec Systems Ltd. (XTRA:OHT)
iFLAG Co.,Ltd. (JASDAQ:2759)
Hubwoo (ENXTPA:HBW)
Purchase
Price (mm)
$9,912.8
$5,343.1
$4,547.1
$4,089.4
$1,863.4
$491.9
$349.4
$275.4
$98.7
$97.1
$68.3
$58.6
$28.6

Enterprise
Value (mm) EV/Rev
$10,045.8
6.7x
$4,844.4
4.6x
$4,459.5
4.7x
$4,047.9
7.6x
$3,117.8
47.5x
$480.7
2.5x
$281.0
1.2x
$221.5
1.9x
$55.1
1.4x
$53.3
0.3x
$58.7
1.4x
$65.8
1.4x
$21.9
0.7x
EV/EBITDA
27.3x
25.6x
36.1x
16.2x
141.0x
7.3x
10.2x
20.8x
TTM Rev
Growth
82.7%
8.0%
78.5%
7.1%
665.4%
196.5%
29.8%
7.5%
-21.7%
-10.4%
22.5%
26.4%
-10.9%
72
Select MEGA DEALS

Date
06/22/15
06/17/15
04/07/15
05/12/15
06/15/15
05/07/15
06/23/15
04/20/15
05/26/15
04/07/15
05/18/15
05/19/15
06/30/15
04/27/15
05/04/15
04/28/15
06/05/15
Buyer
Numericable-SFR (ENXTPA:NUM)
CITIC Securities Company Limited (SHSE:600030)
Permira Advisers; Canada Pension Plan Investment
Verizon Communications Inc. (NYSE:VZ)
Equinix, Inc. (NasdaqGS:EQIX)
Huatai Ruilian Fund Management Co., Ltd.
Telenet Group Holding NV (ENXTBR:TNET)
EMC Corporation (NYSE:EMC)
Singapore Telecommunications Limited (SGX:Z74)
Changjiang Growth Capital Investment Co., Ltd.
Continental Aktiengesellschaft (DB:CON)
MasterCard Incorporated (NYSE:MA)
Delivery Hero Holding GmbH
Twitter, Inc. (NYSE:TWTR)
JM WOWO (NasdaqGM:WOWO)
Purchase
Seller
Price (mm)
Bouygues Telecom S.A.
$11,394.1
Qihoo 360 Technology Co. Ltd. (NYSE:QIHU)
$9,912.8
$5,343.1
AOL Inc.
$4,759.4
$4,547.1
Telecity Group plc (LSE:TCY)
$4,089.4
Momo Inc. (NasdaqGS:MOMO)
$1,863.4
BASE Company nv
$1,425.3
Virtustream, Inc.
$1,200.0
TrustWave Holdings, Inc.
$810.0
China Mobile Games & Entertainment (NasdaqGM:CMGE)
$718.7
Elektrobit Automotive GmbH
$668.2
OpenDNS, Inc.
$635.0
Applied Predictive Technologies, Inc.
$600.0
Yemek Sepeti Elektronik Iletisim Tanitim Pazarlama Gida
$589.0
TellApart, Inc.
$533.0
Join Me Group (HK) Investment Company Limited
$523.9

Enterprise
Value (mm) EV/Rev
$11,394.1
$10,045.8
6.7x
$4,844.4
4.6x
$4,282.5
1.7x
$4,459.5
4.7x
$4,047.9
7.6x
$3,117.8
47.5x
$1,425.3
1.9x
$1,200.0
$826.5
3.8x
$650.1
2.7x
$668.2
3.5x
$600.0
$589.0
$533.0
$523.9
-
EV/EBITDA
27.3x
25.6x
9.9x
36.1x
16.2x
7.8x
12.7x
26.8x
-
TTM Rev
Growth
82.7%
8.0%
8.6%
78.5%
7.1%
665.4%
8.7%
180.9%
15.8%
-
73
MOST ACTIVE BUYERS

Buyer
CA, Inc. (NasdaqGS:CA)
Drivy, SA
Google Inc. (NasdaqGS:GOOGL)
Gravity4, Inc.
Jasper Infotech Private Limited
Microsoft Corporation (NasdaqGS:MSFT)
Sprinklr Inc.
STATS LLC
Synopsys Inc. (NasdaqGS:SNPS)
Twitter, Inc. (NYSE:TWTR)
Vista Equity Partners
Seller
Rally Software Development Corp.
Grid-Tools Limited
IdmLogic LTD.
OpenDNS, Inc.
Piston Cloud Computing, Inc.
Tropo Inc.
Embrane, Inc.
Buzzcar, Inc.
Autonetzer GmbH
Livop Ltd
Agawi Inc.
Pulse.io, Inc.
Timeful Inc.
Rocket Fuel Inc. (NasdaqGS:FUEL)
CrossGraph
EZ Like Midia e Participacoes Ltda.
G4 Search
Accelyst Solutions Pvt. Ltd.
MartMobi Technologies Pvt. Ltd.
Letsgomo Labs LLP
Datazen Software Inc.
6 Wunderkinder GmbH
BlueStripe Software, Inc.
Scup Ltda.
Get Satisfaction, Inc.
newBrandAnalytics, Inc.
Prozone Sports Ltd.
Prozone-Amisco Group
TVT Video Technologies Inc.
Atrenta Inc.
Codenomicon Oy
Quotium Technologies SA, Application Security Solutions
TellApart, Inc.
Whetlab
tenXer, Inc.
Pearson Education, Inc., Student Information Systems Businesses
EagleView Technologies, Inc.
Mediaocean LLC
Purchase Price
(mm)
$431.8
$635.0
$1.2
$97.1
$434.5
$533.0
$350.0
Enterprise
Value (mm)
$432.4
$1.2
$53.3
$342.4
$533.0
$350.0
EV/Rev
4.7x
0.3x
0.8x
-
EV/EBITDA
-

74
ABOUT SOFTWARE EQUITY GROUP

Software Equity Group is an investment bank and M&A advisory serving the software and technology sectors. Founded in 1992, our firm has guided and
advised companies on five continents, including privately-held software and technology companies in the United States, Canada, Europe, Asia Pacific,
Africa and Israel. We have represented public companies listed on the NASDAQ, NYSE, American, Toronto, London and Euronext exchanges. Software
Equity Group also advises several of the world's leading private equity firms. We are ranked among the top ten investment banks worldwide for
application software mergers and acquisitions.
Our value proposition is unique and compelling. We are skilled and accomplished investment bankers with extraordinary software, internet and
technology domain expertise. Our industry knowledge and experience span virtually every software product category, technology, market and delivery
model, including Software-as-a-Service (Saas), software on-demand and perpetual license. We have profound understanding of software company
finances, operations and valuation. We monitor and analyze every publicly disclosed software M&A transaction, as well as the market, economy and
technology trends that impact these deals. We're formidable negotiators and savvy dealmakers who facilitate strategic combinations that enhance
shareholder value.
Perhaps most important are the relationships we've built and the industry reputation we enjoy. Software Equity Group is known and respected by
publicly traded and privately owned software and technology companies worldwide, and we speak with them often. Our Quarterly and Annual Software
Industry Equity Reports are read and relied upon by more than thousands of industry executives, entrepreneurs and equity investors in sixty-one
countries, and we have been quoted widely in such leading publications as The Wall Street Journal, Barrons, Information Week, The Daily Deal, The
Street.com, U.S. News & World Report, Reuters, Mergers & Acquisitions, USA Today, Arizona Republic, Detroit Free Press, Entrepreneur Magazine,
Softletter, Software Success, Software CEO Online and Software Business Magazine.
To keep your finger on the pulse of the software equity markets, subscribe to our Annual and Quarterly Research Reports.
Software Equity Group is an investment bank and M&A advisory serving the software and technology sectors. For a confidential consultation without
obligation, please contact Kris Beible, Director, Business Development (858) 509-2800, kbeible@softwareequity.com .
CONTACT INFORMATION:
Software Equity Group, L.L.C.
12220 El Camino Real, Suite 320
San Diego, CA 92130
www.softwareequity.com
p: (858) 509-2800
The information contained in this Report is obtained from sources we believe to be reliable, but no representation or guarantee is made about the accuracy or completeness of such information, or the opinions expressed
herein. Nothing in this Report is intended to be a recommendation of a specific security or company or intended to constitute an offer to buy or sell, or the solicitation of an offer to buy or sell, any security. Software Equity
Group LLC may have an interest in one or more of the securities or companies discussed herein.
Financial data provided by Capital IQ.
This Report may not be reproduced in whole or in part without the expressed prior written authorization of Software Equity Group, L.L.C.
Software Equity Group registers each Report with the U.S. Copyright Office and vigorously enforces its intellectual property rights.

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Q2 2015

Software Equity Group, L.L.C.

The Software Industry

SOFTWARE INDUSTRY FINANCIAL REPORT CONTENTS

SOFTWARE EQUITY GROUP | Q2 2015 SOFTWARE INDUSTRY FINANCIAL REPORT

SOFTWARE INDUSTRY FINANCIAL REPORT CONTENTS

SOFTWARE EQUITY GROUP | Q2 2015 SOFTWARE INDUSTRY FINANCIAL REPORT

ABOUT SOFTWARE EQUITY GROUP

SOFTWARE EQUITY GROUP | Q2 2015 SOFTWARE INDUSTRY FINANCIAL REPORT

LEADERS IN SOFTWARE M&A

Industry leading boutique investment bank, founded in 1992,

Sell-side client revenue range: $5 - 75 million

Buy-side clients include private equity firms and NASDAQ,

Clients span virtually every software technology, product

Global presence providing advice and guidance to more than

Strong cross-functional team leveraging transaction,

Unparalleled software industry reputation and track record.

Highly referenceable base of past clients

SOFTWARE EQUITY GROUP | Q2 2015 SOFTWARE INDUSTRY FINANCIAL REPORT

EXTENSIVE GLOBAL REACH

SEG currently represents software companies in the

Recent Sell-side Representation

In addition to the countries listed above, SEG has

SEG Research Distribution

SEGs Quarterly and Annual Software Industry

SOFTWARE INDUSTRY MACROECONOMICS

SOFTWARE EQUITY GROUP | Q2 2015 SOFTWARE INDUSTRY FINANCIAL REPORT

U.S. AND GLOBAL GDP

U.S. GDP (% YoY Change)

Global gross domestic product (GDP) growth (YOY) from

Annual growth of the Real Gross Domestic Product (GDP)

U.S. GDP AND UNEMPLOYMENT

SOFTWARE EQUITY GROUP | Q2 2015 SOFTWARE INDUSTRY FINANCIAL REPORT

Global IT Spending by Category

E-COMMERCE AND DIGITAL ADVERTISING SPEND

Mobile E-Commerce Spend ($B)

Worldwide Digital Advertising Spend

E-Commerce Spend ($B)

Aggregate YoY Percent Change

Digital Advertising Revenue ($B)

Desktop E-Commerce Spend ($B)

Digital Advertising Spend ($B)

YoY Percent Change

U.S. E-Commerce Spend

Sources: comScore, IAB, IBD, and Forrester

STOCK MARKET PERFORMANCE

SEG Internet Index

THE SEG SOFTWARE INDUSTRY FINANCIAL REPORT

SOFTWARE EQUITY GROUP | Q2 2015 SOFTWARE INDUSTRY FINANCIAL REPORT

THE SEG SOFTWARE INDEX

SEG - Software: Median Metrics

The SEG Software Index tracks public software companies that

The SEG Software Index is currently comprised of 135 public

The number of public companies comprising the SEG Software Index

THE SEG SOFTWARE INDEX: FINANCIAL PERFORMANCE

TTM Revenue Growth

TTM Revenue Growth

TTM Total Revenue

TTM Total Revenue ($M)

TTM Revenue Growth Rate Distribution 2Q15

After seven consecutive quarters of slowing growth, the median TTM

One in four of the public on-premise software companies comprising

Predictably, the few public on-premise software companies growing

The consolidation of on-premise software companies over the past 15