Software Industry financial_report_3_q14

Q32014
Software Equity Group, L.L.C.
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The Software Industry
Financial Report

SOFTWARE EQUITY GROUP | Q3 2014 SOFTWARE INDUSTRY FINANCIAL REPORT
Copyright © Software Equity Group, LLC, All Rights Reserved 2
About Software Equity Group
Leaders in Software M&A 5
Extensive Global Reach 6
Leading Market Position
Software Industry Macroeconomics
U.S and Global GDP 8
U.S. GDP and Unemployment 9
Global IT Spending 10
E-Commerce and Digital Advertising Spend 11
Stock Market Performance 12
Public Software Financial and Valuation Performance
The SEG Software Index 14
The SEG Software Index: Financial Performance 15-16
The SEG Software Index: Public Market Multiples 17-18
The SEG Software Index by Product Category 19
The SEG Software Index by Product Category: Financial Performance 20
The SEG Software Index by Product Category: Public Market Multiples 21
Public SaaS Company Financial and Valuation Performance
The SEG SaaS Index 23
The SEG SaaS Index: Financial Performance 24-25
The SEG SaaS Index: Public Market Multiples 26-28
The SEG SaaS Index by Product Category: Financial Performance 29
The SEG SaaS Index by Product Category: Public Market Multiples 30
Public Internet Company Financial and Valuation Performance
The SEG Internet Index 32
The SEG Internet Index: Financial Performance 33-34
The SEG Internet Index: Public Market Multiples 35-36
The SEG Internet Index by Product Category 37
The SEG Internet Index by Product Category: Financial Performance 38
The SEG Internet Index by Product Category: Public Market Multiples 39
SOFTWARE INDUSTRY FINANCIAL REPORT CONTENTS

SOFTWARE INDUSTRY FINANCIAL REPORT CONTENTS
Software Industry M&A Market Update
Software/SaaS M&A Deal Volume and Spending 41
Software M&A Exit Multiples 42
Software M&A by Ownership Structure and Size 43
Software M&A by Vertical and Horizontal Markets 44
Software M&A Deal Volume by Product Category 45
Software M&A Exit Valuations by Product Category 46
SaaS M&A Deal Volume and Exit Multiples 47
SaaS M&A by Product Category 48
SaaS M&A 2Q14 Transactions 49-51
Internet M&A: Deal Volume and Exit Multiples 52
Internet M&A: By Product Category 53
Appendix
SEG Software Index Key Metrics 55-58
SEG Software Index Key Metrics by Product Category 59-60
SEG SaaS Index Key Metrics 61-62
SEG SaaS Index Key Metrics by Product Category 63
SEG Internet Index Key Metrics 64-66
SEG Internet Index Key Metrics by Product Category 67
2Q14 Select Public Sellers 68
2Q14 Mega Deals 69
2Q14 Most Active Buyers 70
About Software Equity Group 71

Copyright © Software Equity Group, LLC, All Rights Reserved
ABOUT SOFTWARE EQUITY GROUP

• 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
We Do Deals.
LEADERS IN SOFTWARE M&A

SEG Research Distribution
Current Sell-side Representation
Recent Sell-side Representation
• SEG currently represents software companies in the
United States, Canada, France, Germany, Australia &
Saudi Arabia
• In addition to the countries listed above, SEG has
recently represented software companies in the
United Kingdom, France, Netherlands, Israel, and
South Africa
• SEG’s 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.
EXTENSIVE GLOBAL REACH

SOFTWARE INDUSTRY MACROECONOMICS

U.S. AND GLOBAL GDP
U.S. GDP (% YoY Change)Global GDP (% YoY Change)
Sources: Worldbank, The Economist, Council of Economic Advisors, and Statista
• The latest IMF forecast portrays a gradually improving global economy that remains susceptible to a host of economic and geopolitical downside risks.
• The IMF’s most recent forecast predicts U.S. GDP will grow 2.2% in 2014, the same as 2013’s growth rate. Temporary setbacks, such as an unusually harsh
winter, constrained GDP growth in the first quarter. According to the IMF, the U.S. economy rebounded in Q2, in part due to improved housing activity,
declining unemployment and steady payroll gains.
• According to the IMF, global GDP is expected to inch up to 3.5% in the second half of 2014 and 3.8% in 2015, while GDP growth in developed nations is
expected to grow at a median of 1.8% in 2014, a modest improvement over 2013’s 1.4%. Key growth drivers include an improving labor market, better
household balance sheets, and a favorable economic climate. In emerging markets, annual GDP growth is expected to slow slightly from 2.8% in 2013 to
2.7% in 2014, but is predicted to rebound in 2015 to 2.9%.
• The IMF acknowledged its forecasts could be imperiled by recent geopolitical events and renewed threats of defaults and recessions among EEC member
countries.

U.S. GDP AND UNEMPLOYMENT
• According to February’s Federal Reserve survey of 43 economists, GDP growth in the U.S. for 3Q14 is forecast to be 3.0%. For the year, expectations are
the U.S. economy will grow 2.1%, as a surprisingly weak first half tempered expectations for a more robust annual growth rate in 2014.
• Fewer than 15% of economists surveyed by the Fed predicted the U.S. economy will grow more than 3.0% in the third quarter of 2014. However, more
than 40% believe the U.S. economy will grow 3.0% or greater in 2015.
• The Labor Department reported the unemployment rate at the end of 3Q14 was 6.1%, a noteworthy decline from 1Q14’s 6.7%, and the lowest
unemployment rate since 2008. The labor participation rate showed minimal decline, edging down slightly to 62.7% in September, a 35 year low.

GLOBAL IT SPEND
Sources: Global IT spending chart is a blended average of Goldman Sachs, IDC, Forrester, and Gartner forecasts. IT Spending by Category chart from Forrester.
• At the outset of 2014, analysts at Goldman Sachs, Gartner and elsewhere projected Global IT spending in 2014 would increase 4%, a marked improvement
from the tepid 2.0% growth that has prevailed during the past two years.
• Revised forecasts predict average global IT spending will increase only 3.3% in 2014, citing a weak 1H 2014 and continuing economic uncertainty and
geopolitical upheaval. Gartner, however, cut its forecast from 3.2% to 2.1%, citing a tougher competitive environment that is placing significant price
pressure on suppliers.
• Forrester estimates software will account for 26% of all tech spending, leading all other categories. According to Forrester, “Software’s 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.”
Global IT Spending by CategoryGlobal IT Spending (% YoY Change)

E-COMMERCE AND DIGITAL ADVERTISING SPEND
Sources: comScore, IAB, IBD, and Forrester
• E-commerce retail sales in the U.S. totaled $54.8 billion in 2Q14 (the latest data available), up 13% YoY. The increase marks the nineteenth consecutive
quarter of YoY growth, and the fifteenth consecutive quarter of double digit growth.
• The Q3 total for E-Commerce spending accounted for 11.6% of all discretionary retail dollars spent.
• Mobile commerce accounted for $6.8 billion, or 11.1% of the 2014 E-Commerce total, according to comScore. In addition, YoY growth in mobile commerce
grew a whopping 47%.
• The digital commerce growth rate of 13% in Q2 far exceeded the 3% growth in total consumer discretionary spending, confirming that the shift to online
continues unabated.
• According to Forrester, U.S. digital ad revenues will total $19.8 billion in 2014, with the most growth coming from video advertising. Forrester predicts
video advertising on desktop devices alone will grow 21% annually until 2019, when it will contribute 54.6% of total desktop display ad revenue across
the Web.
Worldwide Digital Advertising SpendU.S. E-Commerce Spend

STOCK MARKET PERFORMANCE
• Technology stock prices lost more ground in 3Q14, especially high-growth, SaaS based companies that have been unable to recapture pre-recession
growth rates.
• The Nasdaq posted the best return of the three major stock indices in 3Q14, finishing up 7.6%. The S&P finished close behind, up 6.7%. Surprisingly, in an
environment where investors flocked to value stocks in 2Q14, the DOW performed worst among the three major U.S. stock market indices, closing 3Q14
with a gain of only 2.8%.
• The SEG SaaS Index posted the greatest Q3 decline in median stock return among our six tracking indices. In early March, our SaaS Index peaked at a
9.2% gain, only to plunge dramatically in the second quarter. The SEG SaaS Index lost another 4.1% in Q3 to close 3Q14 down 14.1% for the year, making
it the worst YTD performer of our three tracking indices. In addition to macro economic concerns, many were concerned SaaS valuations had grown too
rich. More on SaaS median EV/Revenue multiples later in this report.
• The SEG Software Index, consisting largely of mature, profitable software providers slowed its descent, finishing the third quarter 4.6%, lower, compared
to a decline of 8.4% in May, its lowest point for the year.
(35.0%)
(30.0%)
(25.0%)
(20.0%)
(15.0%)
(10.0%)
(5.0%)
0.0%
5.0%
10.0%
15.0%
Jan 2014 Feb 2014 Mar 2014 Apr 2014 May 2014 Jun 2014 Jul 2014 Aug 2014 Sep 2014
DOW S&P NASDAQ SEG SW Index SEG SaaS SEG Internet Index

THE SEG SOFTWARE INDUSTRY FINANCIAL REPORT
PUBLIC SOFTWARE COMPANY FINANCIAL PERFORMANCE AND MARKET MULTIPLE TRENDS

THE SEG SOFTWARE INDEX
• 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 141 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 migrated to a SaaS business model.
• Median Cash and Equivalents of the SEG Software Index grew YoY by
23.8%, despite a markedly lower median EBITDA margin and median
TTM revenue growth rate.
Measure 3Q13 4Q13 1Q14 2Q14 3Q14
EV/Revenue 3.0x 3.2x 3.2x 3.0x 2.9x
EV/EBITDA 13.8x 14.7x 15.5x 14.8x 15.3x
EV/Earnings 28.1x 26.9x 27.2x 26.2x 27.0x
Gross Profit Margin 67.9% 67.5% 66.6% 66.5% 66.3%
EBITDA Margin 17.8% 17.6% 17.3% 17.1% 16.4%
Net Income Margin 8.2% 8.5% 8.6% 8.2% 8.5%
TTM Revenue Growth 9.9% 8.9% 8.5% 8.2% 8.0%
TTM Total Revenue ($M) $451.5 $449.8 $484.4 $532.3 $558.8
TTM EBITDA Growth 6.4% 6.7% 5.7% 5.1% 6.1%
TTM Total EBITDA ($M) $82.8 $88.0 $86.5 $90.2 $100.1
Cash & Eq ($M) $153.2 $181.7 $175.6 $203.4 $189.6
Current Ratio 1.9 2.0 2.0 2.0 2.1
Debt / Equity Ratio 26.5% 33.8% 34.9% 31.1% 37.7%
SEG - Software: Median Metrics
* 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

THE SEG SOFTWARE INDEX: FINANCIAL PERFORMANCE
• Median TTM revenue growth of public on-premise software
companies in 3Q14 declined for the seventh consecutive quarter, to
8.0%.
• Indeed, more than half of public on-premise software companies
reported TTM revenue growth rates of 10% or lower in 3Q14; only
13% posted TTM revenue growth rates of 30% or more.
• Those growing 30%+ were focused on three of the hottest product
categories: mobility (NQ Mobile – 114.3%), networking (Mavenir
Systems – 40.3%), and security (Palo Alto Networks – 51.0%).
• The median revenue of the SEG Software Index grew by an amount
roughly equivalent to the tepid median revenue growth rate,.
Increasingly, this is a world of very large behemoths whose growth
has stalled due to much more focused, prioritized and constrained
enterprise IT spending – a five year phenomenon that now appears to
be an established trend.
TTM Revenue Growth Rate Distribution – 3Q14Median Revenue Performance – Quarterly
15

THE SEG SOFTWARE INDEX: FINANCIAL PERFORMANCE
• The median EBITDA margin of public on-premise software companies
has remained mostly unchanged over the past five quarters, closing
3Q14 at 16.4%.
• Only 4% of on-premise software companies achieved EBITDA
margins of 40%+ in the third quarter.
• Check Point Software, a security software provider, led the pack again
this quarter with an EBITDA margin of 54.7%, only slightly lower
than last quarter’s 55.1%. Check Point’s extraordinary profitability
can be attributed in part to a strong, well-performing channel that
reduces its cost of sales. Curiously, for a company in a technology
driven product category, Check Point also spends substantially less on
R&D (9% of revenue) compared to their category peers (15% of total
revenue).
• We anticipate the median EBITDA margin of public software
companies will continue to decline modestly in 4Q14 and into 2015,
as many ramp up spending on sales and marketing to spur growth,
and invest more in R&D to update legacy products and expand their
SaaS offerings.
TTM EBITDA Margin Distribution – 3Q14Median EBITDA Margin Performance – Quarterly
16

• Investors continued to be comforted by size. The EV/Revenue
multiples of on-premise software companies with revenues <$100
million remained notably lower than their larger counterparts.
• The increased volatility of tech sector stocks in Q3 seems to have
prompted investors to view the largest on premise companies
(revenues greater than $1 billion) more favorably, despite their
slowed growth.
• SEG Software Index companies with TTM revenue between $100M
and $1B closed 3Q14 with virtually the same EV/Revenue market
multiple as a year earlier.
THE SEG SOFTWARE INDEX: PUBLIC MARKET MULTIPLES
• The median EV/Revenue market multiple for on-premise software
providers was 2.9x in 3Q14.
• Despite mostly unremarkable financial performance, the SEG
Software Index closed 3Q14 with a median trading multiple only
slightly lower than the prior quarter.
• The higher median EV/Revenue valuations of many public software
companies over the past several quarters reflect continuing investor
enthusiasm for technology stocks, which is likely to wane over time
unless revenue growth accelerates and recurring revenue from
subscriptions increases substantially.
• 3Q14’s median EV/EBITDA market multiple of 15.3x was the second
highest since 4Q07.
EV/Revenue Multiples by Size (TTM Revenue) – QuarterlyMedian EV/Revenue and EV/EBITDA Multiples – Quarterly
17
3.0x 3.2x 3.2x 3.0x 2.9x
13.8x
14.7x
15.5x
14.8x 15.3x
3Q13 4Q13 1Q14 2Q14 3Q14
MedianMultiple
EV/Revenue EV/EBITDA

THE SEG SOFTWARE INDEX: PUBLIC MARKET MULTIPLES
• Market performance of most on premise public software companies
remained closely correlated with their TTM revenue growth rates in
3Q14. The median EV/Revenue multiples of companies growing TTM
revenue greater than 40% increased 14%, from the prior quarter.
• Members of Q3’s 40%+ growth club that rewarded investors
handsomely in 3Q14 came from the fastest growing product category,
mobile. Select 3Q14 outperformers included: Qihoo 360 Technology
(121.3% TTM revenue growth, 11.1x EV/Revenue), and Splunk
(51.6% TTM revenue growth, 13.3x EV/Revenue).
• On-premise software providers that grew TTM revenue 30% to 40%
in 3Q14 were rewarded with a median market multiple of 4.9x, a 40%
improvement over the prior quarter.
• The median market multiples of unprofitable and modestly profitable
on-premise software providers in 3Q14 were virtually the same as the
prior quarter.
• On-premise software companies with TTM EBITDA margins greater
than 20% for Q3 were awarded median EV/Revenue multiples
substantially greater than the index median of 2.9x.
• Investors did take special note in 3Q14 of on-premise providers with
EBITDA margins greater than 40%, conferring a median EV/Revenue
multiple of 6.8x, or 134% higher than the index median. Examples
included: Check Point Software (54.7% EBITDA margin, 8.2x
EV/Revenue multiple); Ansys (46.5%, 7.2x); Verisk (45.4%, 6.8x); and
Evertec (41.7%, 6.9x).
EV/Revenue Multiples vs. TTM EBITDA Margins – 3Q14EV/Revenue Multiples vs. TTM Revenue Growth – 3Q14
18

THE SOFTWARE INDEX BY PRODUCT CATEGORY
• The SEG Software Index is segmented into 16 product categories.
• Market valuations, TTM growth rates and margins can vary widely quarter to quarter, and category to category. For example, Billing & Service
Management providers had a median EV/Revenue market valuation of 3.6x in 4Q13 when revenue growth was only 4.4%; median EV/Revenue for the
category plummeted to 1.8x in 3Q14 despite a revenue growth rate (8.2%) that was almost double.
• See Appendix for the complete list of companies within each product category.
3Q13 4Q13 1Q14 2Q14 3Q14 3Q13 4Q13 1Q14 2Q14 3Q14 3Q13 4Q13 1Q14 2Q14 3Q14 3Q13 4Q13 1Q14 2Q14 3Q14
Billing & Service Management 3.1x 3.6x 2.6x 1.9x 1.8x 9.9x 9.0x 9.3x 10.1x 9.9x 17.7% 4.4% 3.6% 4.8% 8.2% 18.7% 18.6% 18.5% 18.4% 21.1%
Business Intelligence 3.4x 3.3x 3.1x 2.9x 3.0x 17.7x 18.8x 16.2x 15.1x 16.0x 6.5% 5.2% 8.1% 9.3% 9.5% 15.5% 17.1% 16.6% 16.8% 15.0%
Development Platforms 2.1x 2.4x 2.4x 2.4x 1.8x 12.9x 15.4x 13.0x 15.1x 21.3x -1.9% -0.6% -3.1% -0.8% 1.2% 18.4% 19.5% 19.1% 19.2% 18.9%
Engineering & PLM 2.9x 3.3x 3.8x 3.8x 4.1x 14.8x 14.8x 14.9x 14.8x 15.4x 9.4% 6.8% 7.1% 6.6% 6.8% 18.9% 20.5% 20.8% 19.5% 19.0%
Enterprise Resource Planning 3.0x 2.9x 3.7x 3.6x 3.4x 12.1x 12.5x 12.5x 12.3x 11.7x 1.6% 2.7% 2.0% 2.7% 3.0% 28.7% 29.0% 29.3% 29.5% 29.5%
Financial & Accounting 3.3x 3.7x 3.7x 3.6x 3.4x 12.3x 13.6x 15.7x 13.3x 13.5x 9.5% 10.7% 8.5% 4.7% 2.5% 26.1% 26.7% 25.9% 25.6% 26.0%
Gaming 1.6x 1.6x 1.7x 1.9x 1.5x 12.2x 13.5x 11.3x 14.1x 13.0x 15.2% 10.7% -3.6% -4.8% 0.2% 13.9% 13.6% 17.9% 15.9% 15.5%
Healthcare 2.4x 2.5x 2.4x 2.3x 2.2x 13.2x 14.4x 15.0x 14.6x 14.8x 7.1% 3.1% 3.0% 0.1% 1.1% 17.8% 16.9% 15.2% 14.1% 14.1%
IT Conglomerates 2.7x 3.0x 3.0x 3.3x 3.5x 8.4x 8.5x 9.0x 8.9x 9.6x 1.2% 0.9% 2.0% 2.7% 2.2% 32.4% 33.1% 34.2% 34.4% 34.5%
Mobile Solutions/Content 3.4x 3.5x 3.5x 2.9x 3.1x 13.6x 19.5x 39.5x 19.0x 20.5x 29.1% 27.3% 27.5% 17.9% 21.1% 7.7% 5.4% 5.9% 4.2% 0.7%
Networking & Network
Performance Management
2.9x 3.3x 3.3x 3.0x 2.5x 17.0x 16.9x 18.9x 20.4x 19.5x 7.2% 6.1% 9.4% 8.8% 8.7% 12.4% 8.1% 7.1% 7.8% 8.2%
Security 3.1x 3.5x 4.0x 3.2x 3.2x 11.4x 13.8x 10.0x 11.6x 15.0x 19.6% 17.0% 17.5% 16.5% 15.2% 11.1% 2.4% 10.6% 10.9% 12.5%
Storage, Data Management &
Integration
2.5x 2.6x 3.0x 2.6x 2.5x 10.6x 9.5x 9.4x 8.8x 9.9x 4.4% 4.5% 4.7% 5.4% 2.4% 17.6% 18.1% 18.2% 18.0% 17.1%
Systems Management 5.4x 4.5x 5.0x 4.5x 5.0x 20.1x 17.0x 18.9x 17.8x 19.4x 16.4% 15.3% 13.0% 13.3% 15.8% 24.2% 24.2% 25.9% 25.7% 25.3%
Vertical - Finance 3.7x 4.7x 4.5x 4.3x 4.4x 12.6x 13.0x 13.4x 13.3x 13.5x 6.1% 6.8% 8.2% 8.1% 6.3% 25.9% 26.0% 26.7% 26.8% 29.3%
Vertical - Other 3.7x 3.6x 3.2x 3.2x 3.4x 22.8x 21.8x 19.6x 18.3x 24.3x 22.3% 24.9% 21.2% 21.2% 16.6% 13.9% 13.9% 12.8% 11.3% 11.6%
Median 3.0x 3.2x 3.2x 3.0x 2.9x 13.8x 14.7x 15.5x 14.8x 15.3x 9.9% 8.9% 8.5% 8.2% 8.0% 17.8% 17.6% 17.3% 17.1% 16.4%
SEG Software Index
Category
EV/Revenue EV/EBITDA TTM Revenue Growth EBITDA Margin

THE SEG SOFTWARE INDEX BY PRODUCT CATEGORY:
FINANCIAL PERFORMANCE
3Q14 YoY Change in Median Revenue Growth3Q14 Median TTM Revenue Growth
3Q14 YoY Change in Median EBITDA Margin3Q14 Median TTM EBITDA Margin

• In 3Q14, ten product categories achieved median EV/Revenue multiples above the SEG Software Index median of 2.9x, led by Systems Management (5.0x),
Vertical Finance (4.4x) and Engineering & PLM (4.1x).
• The Systems Management product category is attracting renewed investor interest as large enterprises seek to address shrinking margins, operational
inefficiencies and demanding customers by providing a new wave of systems solutions.
• The Systems Management and Security categories are benefitting from the rapid shift to cloud and mobile computing, which require new approaches to
scaling, managing and securing these new environments.
• The Gaming category closed 3Q14 with a median EV/Revenue multiple of 1.5x, the lowest of our 16 product categories, in-line with the 9.7% YoY median
EV/Revenue decay for Gaming. Expect gaming multiples to improve, as gaming providers - caught flat footed by the explosion of mobile and Internet
gaming - reposition with online and mobile games suitable for a multi-device world.
• The median TTM revenue growth rate accelerated in 6 of 16 product categories in 3Q14, although there was little correlation between median TTM
revenue growth and market multiple. The six categories with higher YoY EV/Revenue multiples included: Engineering & PLM, Enterprise Resource
Planning, Financial & Accounting, IT Conglomerates, Security and Vertical – Finance (i.e. software providers focused on the financial services vertical).
THE SEG SOFTWARE INDEX BY PRODUCT CATEGORY:
PUBLIC MARKET MULTIPLES
Median 3Q14 YoY Change in EV/Revenue3Q14 Median EV/Revenue Multiples

THE SEG SaaS INDEX
PUBLIC SaaS COMPANY FINANCIAL PERFORMANCE AND MARKET MULTIPLE TRENDS

THE SEG SaaS INDEX
• 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 52 publicly traded,
pure-play SaaS companies*.
* See appendix for complete list of companies in the SEG SaaS Index
23
SEG - SaaS: Median Metrics
Measure 3Q13 4Q13 1Q14 2Q14 3Q14
EV/EBITDA 36.8x 46.8x 65.4x 51.8x 56.0x
EBITDA Margin -5.1% -8.3% -4.0% -1.7% -2.4%
Net Income Margin -12.4% -14.2% -16.5% -15.8% -14.5%
TTM Revenue Growth 28.1% 28.5% 30.5% 29.3% 25.8%
TTM Total Revenue ($M) $107.9 $120.4 $129.3 $132.6 $140.5
TTM EBITDA Growth 16.2% 19.8% 6.0% 16.3% 12.9%
TTM Total EBITDA ($M) -$4.4 -$5.2 -$4.5 -$4.4 -$3.4
Cash & Eq ($M) $69.8 $80.1 $87.0 $92.0 $107.1
Current Ratio 1.7 2.4 2.3 2.3 2.1
Debt / Equity Ratio 11.3% 13.4% 28.3% 15.9% 5.9%

THE SEG SaaS INDEX: FINANCIAL PERFORMANCE
• The median TTM revenue growth rate of Public SaaS companies in 3Q14 was 25.8%, down from 28.1% in 3Q13. We anticipate only marginally higher
growth in Q4.
• The median TTM revenue of public SaaS companies was $140.5M in 3Q14, a significant YoY increase from 3Q13’s $107.9M. The growth in revenue is
partly inorganic, as the group has become increasingly acquisitive, and partly attributable to larger enterprise subscriptions and upgrades.
• For sheer size, Salesforce continued to dominate the SaaS Sector 3Q14 with TTM revenue of $4.5B, over 7x greater than the next largest Public SaaS
company. However, many public SaaS companies reached critical revenue mass (>$350 million) in 3Q14, a feat made more difficult by a revenue model
that often 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 Athenahealth (Healthcare, $672M); Concur (Expense Management, $678M TTM revenue);
DealerTrack (Automotive, $634M); Workday (HCM/Financial, $616M); Service-Now (IT Automation, $542M); NetSuite (ERP, $477M); and RealPage (Real
Estate, $389M).
• Medians alone do not capture the standout performances of the most successful SaaS companies. Nearly one in five public SaaS companies grew TTM
revenue growth by 50% or more. As further testament to the widespread adoption of SaaS, these outperformers come from a variety of product
categories including Workforce Management, Life Sciences, Marketing, Security, and Business Intelligence. Select high growth public SaaS companies
include: FireEye (132.9%); Tableau Software (87.8%); Workday (74.4%); Service-Now.com (65.5%); Marketo (65.5%); Veeva Systems (54.9%); and
Opower (54.4%).
TTM Revenue Growth Rate Distribution– 3Q14Median Revenue Performance – Quarterly
24

THE SEG SaaS INDEX: FINANCIAL PERFORMANCE
• The median EBITDA margin of public SaaS companies remained
negative, closing 3Q14 at -2.4%, a modest decline from the prior
quarter.
• Over half (55%) of public SaaS companies are unprofitable, and
roughly seven out of ten have EBITDA margins below the 20%
median of their on-premise software peers.
• And for the time being, that’s just what investors expect, if the strong
correlation between their EV/Revenue multiples and TTM revenue
growth rates (see slide 26) is any indication.
• Investors should be circumspect about the GAAP compliant P&L
statements of many public SaaS companies which seem to indicate
they’re suffering significant losses and hemorrhaging cash. In truth,
many are not only cash flow positive, but flush with revenue from
prepaid subscription fees that require deferred recognition under
GAAP. As example, in its most recent 10-Q, ServiceNow reported a
$92.6M net comprehensive loss, but was cash flow positive from
operations to the tune of $66.3M.
TTM EBITDA Margin Distribution– 3Q14Median EBITDA Margin Performance – Quarterly
25

THE SEG SaaS INDEX: PUBLIC MARKET MULTIPLES
• At the close of 3Q14, the median EV/Revenue multiple for public SaaS companies was 6.2x, down 10% YoY, but only slightly lower than last quarter’s
median EV/Revenue multiple of 6.5x. The retreat reflected growing investor concerns over the past two quarters about overheated technology sector
stock prices.
• Still, over 30% of the companies in the SEG SaaS Index achieved a median EV/Revenue multiple of 8x or higher in 3Q14, and public SaaS companies
continued to trade at a significant premium to their on-premise peers (6.2x vs. 2.9x median EV/Revenue). Public SaaS companies have historically
enjoyed trading multiples at least twice that of their on-premise peers, and while 3Q14’s differential was exceptional, we anticipate further regression to
the mean for the remainder of 2014.
• A premium market valuation 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.
EV/Revenue Multiple Distribution– 3Q14Median EV/Revenue and EV/EBITDA Multiples – Quarterly
26
6.9x 7.5x 7.6x 6.5x 6.2x
36.8x
46.8x
65.4x
51.8x
56.0x
3Q13 4Q13 1Q14 2Q14 3Q14
MedianMultiple

• In 3Q14, investors continued to handsomely reward the fastest growing public SaaS companies, as noted by the very strong correlation between their
median TTM revenue growth rates and median market multiples. Public SaaS companies that grew TTM revenue in excess of 50% were anointed with the
highest median EV/Revenue multiple of 12.2x in 3Q14.
• Conversely, investors deemed profitability to be an unacceptable tradeoff for accelerated growth. Once again, there was an inverse correlation between
EBITDA margins and median EV/Revenue multiples in 3Q14. Unprofitable or slightly profitable public SaaS companies achieved an admirable median
EV/Revenue multiple of 6.7x and 6.9x, respectively, in the third quarter, while those with EBITDA margins above 30% had a median market multiple of
only 3.5x EV/Revenue.
27

Company Ticker EV (Median)
TTM
Revenue
TTM
Revenue
Growth
EV/
Revenue
TTM
EBITDA
EBITDA
Margin
EV/
EBITDA
Liquid Holdings Group LIQD n/a $4 -10.9% - NA n/a -
Castlight Health CSLT $1,013 $28 - 36.6x -$82 -295.7% -
Workday WDAY $14,516 $616 74.4% 23.6x -$155 -25.2% -
FireEye FEYE $4,379 $268 132.9% 16.3x -$278 -103.6% -
Service-now.com NOW $8,336 $542 65.5% 15.4x -$84 -15.5% -
Zendesk ZEN $1,454 $96 - 15.1x -$37 -38.2% -
Demandware DWRE $1,745 $128 44.5% 13.6x -$18 -13.7% -
Netsuite N $6,263 $477 33.4% 13.1x -$39 -8.1% -
Tableau Software DATA $3,751 $308 87.8% 12.2x $15 5.0% 244.2x
Veeva Systems VEEV $2,799 $260 54.9% 10.8x $53 20.4% 52.8x
Textura TXTR $630 $59 - 10.7x -$14 -23.0% -
Cornerstone OnDemand CSOD $2,067 $222 48.8% 9.3x -$37 -16.6% -
Paylocity Holding PCTY $976 $109 40.6% 9.0x -$3 -2.4% -
The Ultimate Software Group ULTI $3,961 $458 23.7% 8.6x $66 14.5% 59.6x
Marketo MKTO $1,047 $122 63.7% 8.6x -$42 -34.4% -
Concur CNQR $5,495 $668 31.8% 8.2x $22 3.3% 247.8x
Medidata Solutions MDSO $2,438 $305 24.2% 8.0x $25 8.2% 96.9x
Benefitfocus BNFT $907 $120 31.1% 7.6x -$37 -30.8% -
Salesforce.com CRM $36,034 $4,767 37.3% 7.6x $3 0.1% 11579.1x
Athenahealth ATHN $5,073 $672 36.0% 7.5x $61 9.1% 82.8x
OPOWER OPWR $785 $108 54.4% 7.3x -$29 -26.7% -
Cvent NYSE:CVT $907 $125 29.6% 7.2x $6 4.6% 156.4x
TrueCar NasdaqGS:TRUE $1,150 $172 - 6.7x -$30 -17.6% -
2U TWOU $639 $96 - 6.6x -$31 -32.3% -
SPS Commerce SPSC $757 $115 24.8% 6.6x $11 9.7% 67.7x
Ellie Mae ELLI $877 $136 10.6% 6.5x $23 16.7% 38.7x
Q2 Holdings QTWO $411 $66 - 6.2x -$16 -24.8% -
Qualys QLYS $713 $119 20.4% 6.0x $14 11.8% 50.4x
Amber Road AMBR $337 $60 30.2% 5.6x -$25 -41.1% -
E2open EOPN $409 $77 9.2% 5.3x -$25 -32.4% -
Fleetmatics FLTX $1,059 $204 35.7% 5.2x $44 21.9% 23.8x
DealerTrack TRAK $2,929 $634 46.9% 4.6x $76 12.0% 38.4x
ChannelAdvisors ECOM $338 $77 28.9% 4.4x -$23 -30.4% -
J2 Global JCOM $2,376 $545 21.0% 4.4x $226 41.5% 10.5x
RingCentral RNG $798 $188 38.5% 4.2x -$39 -20.5% -
Callidus Software CALD $509 $124 23.6% 4.1x $0 -0.2% -
Zix ZIXI $190 $49 6.5% 3.9x $12 23.5% 16.4x
Medical Transcript MTBC $40 $11 - 3.6x $1 6.5% 56.0x
inContact SAAS $523 $145 19.9% 3.6x -$3 -2.4% -
SciQuest SQI $332 $99 25.8% 3.4x $3 2.9% 114.8x
RealPage RP $1,246 $389 10.4% 3.2x $42 10.8% 29.6x
LivePerson LPSN $607 $191 13.8% 3.2x $8 4.3% 73.7x
Bazaarvoice BV $536 $174 14.7% 3.1x -$30 -17.4% -
Constant Contact CTCT $855 $307 14.4% 2.8x $34 11.0% 25.3x
Ebix EBIX $539 $204 -3.5% 2.6x $78 38.5% 6.9x
Jive Software JIVE $405 $161 23.4% 2.5x -$57 -35.3% -
Tangoe TNGO $496 $201 14.4% 2.5x $14 7.2% 34.2x
Marin Software MRIN $218 $89 30.5% 2.5x -$27 -30.5% -
Halogen Software TSX:HGN $127 $52 21.3% 2.4x -$6 -11.7% -
Rally Software Development RALY $173 $79 20.2% 2.2x -$25 -31.3% -
IntraLinks Holdings IL $489 $245 8.7% 2.0x $9 3.6% 56.0x
Covisint COVS $127 $95 0.4% 1.3x -$41 -43.2% -
Top 25%
Bottom 25%
• When the SEG SaaS Index is segmented on
the basis of median EV/Revenue multiple,
the top 25% boasted a breathtaking median
12.7x in 3Q14.
• 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 51.9%.
All but three companies (Tableau Software,
Veeva Systems, Ultimate Software Group) in
the top 25% had a negative EBITDA margin
as of 3Q14.
• In contrast, the median TTM revenue
growth rate of those comprising the bottom
25% of EV/Revenue multiples was 14.4%,
and over half of these companies were
profitable.
28

(8.6%)
(8.1%)
8.2%
(11.7%)
CRM &
Marketing
ERP &
Supply Chain
Vertically
Focused
Workforce
Management
THE SEG SaaS INDEX BY PRODUCT CATEGORY:
3Q14 YoY Change in Median Revenue Growth3Q14 Median TTM Revenue Growth
3Q14 YoY Change in Median EBITDA Margin3Q14 Median TTM EBITDA Margin
29
29.6%
30.2%
30.1%
31.1%
CRM &
Marketing
ERP &
Supply Chain
Vertically
Focused
Workforce
Management
42.9%
(20.0%)
7.9%
(22.8%)
CRM &
Marketing
ERP &
Supply Chain
Vertically
Focused
Workforce
Management
(28.5%)
(1.6%)
(22.3%)
(6.1%)
CRM & Marketing
ERP & Supply Chain
Vertically Focused
Workforce Management

THE SEG SaaS INDEX BY PRODUCT CATEGORY:
• As in past quarters, public SaaS companies comprising the Workforce Management category posted the highest median public market valuation (8.6x
EV/Revenue) of our four SaaS tracking categories in 3Q14. The category is led by Workday (23.6x EV/Revenue multiple) and Cornerstone On Demand
(9.3x EV/Revenue). Valuation drivers included the continued displacement of on-premise incumbents, and growing pressure on large enterprise
customers to enhance products, reduce costs and improve employee retention and satisfaction.
• Workforce Management SaaS companies also achieved the highest TTM revenue growth rate in 3Q14, 31.1%. This category, which includes long-standing
category member LivePerson, was boosted by Marketo’s stunning TTM revenue growth rate of 63.7%, and Salesforce revenue growth of 37.3% in Q3.
• Although Workforce Management companies had the highest TTM revenue growth rate, median TTM growth actually declined YoY, which likely explains
the 7.9% YoY contraction in Q3’s median EV/Revenue multiple for the category.
3Q14 YoY Change in Median EV/Revenue3Q14 Median EV/Revenue Multiple
30
5.2x
5.6x
6.6x
8.6x
CRM &
Marketing
ERP &
Supply Chain
Vertically
Focused
Workforce
Management
17.5%
(39.1%)
16.5%
(26.4%)
CRM &
Marketing
ERP &
Supply Chain
Vertically
Focused
Workforce
Management

THE SEG INTERNET INDEX
PUBLIC INTERNET COMPANY FINANCIAL PERFORMANCE AND MARKET MULTIPLE TRENDS

THE SEG INTERNET INDEX
• 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 103 public Internet
companies*.
* See appendix for complete list of companies in the SEG Internet Index
32

17%
16%
20% 20%
8%
20%
<= 0% > 0%
<= 10%
> 10%
<= 20%
> 20%
<= 30%
> 30%
<= 40%
> 40%
%ofCompanies
TTM Revenue Growth
THE SEG INTERNET INDEX: FINANCIAL PERFORMANCE
• Approximately 62% 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 to 18.0% growth in Q2 from 18.9% in Q1, median TTM
revenue of the SEG Internet Index grew 19.2% in the third quarter.
• Once again demonstrating the Internet is an ecosystem of unequals,
one in five public Internet providers far outpaced the pack, posting
TTM revenue growth greater than 40% in 3Q14. These high flyers
included Twitter (117%), Rocketfuel (97%), and Facebook (64%).
• Conversely, 34% of public Internet companies struggled to advance,
reporting TTM revenue growth of 10% or less in 3Q14. Examples
include Orbitz, 1-800-Flowers.com, Zynga, and VeriSign.
TTM Revenue Growth Rate Distribution – 3Q14Median Revenue Performance – Quarterly
33
-5.0%
0.0%
5.0%
10.0%
15.0%
20.0%
25.0%
$380
$385
$390
$395
$400
$405
$410
$415
$420
$425
3Q13 4Q13 1Q14 2Q14 3Q14
TTMRevenueGrowth
TTMTotalRevenue
TTM Total Revenue ($M) TTM Revenue Growth Qtrly GDP Growth

24%
31%
22%
8%
11%
5%
<= 0% > 0%
<= 10%
> 10%
<= 20%
> 20%
<= 30%
> 30%
<= 40%
> 40%
%ofCompanies
TTM EBITDA Margin
THE SEG INTERNET INDEX: FINANCIAL PERFORMANCE
• The median EBITDA margin of the SEG internet Index declined for the
fourth consecutive quarter.
• Almost one in four SEG Internet Index companies were unprofitable
in 3Q14, compared to one in five the prior quarter. The median S&M
spend as a percent of revenue of public Internet companies increased
in the third quarter to 26.2%, up from 25.4% last quarter.
• At the other end of the spectrum, 5% of public Internet companies,
mostly those with significant transaction or advertising revenue,
achieved EBITDA margins above 40%, led by VeriSign (61.0%),
Facebook (54.2%) and recent IPO Alibaba (51.6%).
• The widely disparate financial performance of the SEG Internet Index
reveals an Internet ecosystem clearly bifurcated into “haves” and
“have nots.” Virile market adoptions, consumer fickleness, switching
ease and fierce competition handsomely continued to reward a select
few and punish others in the third quarter.
• Facebook has added credibility to the notion that its better to scale
the user base first, then monetize it. The question remains, will other
public Internet companies such as Yelp and Twitter fare as well?
TTM EBITDA Margin Distribution – 3Q14Median EBITDA Margin Performance – Quarterly
34
9.3%
10.0%
9.0%
8.5% 8.3%
3Q13 4Q13 1Q14 2Q14 3Q14
EBITDAMargin

THE SEG INTERNET INDEX: PUBLIC MARKET MULTIPLES
• The median public market EV/Revenue multiple of public Internet providers closed 3Q14 at 2.7x, the lowest since 3Q13.
• Considering approximately 60% of public Internet companies are highly dependent on consumer spending (Travel, Games, Advertising, etc), we see the
deterioration in median EV/Revenue as a reflection of declining profitability caused by increased competition and downward pressure on prices. Almost
50% of companies comprising our Internet Index closed Q3 with an EV/Revenue multiple of 2.0x or less.
• Conversely, 24% closed the quarter with a market multiple of 7.0x EV/Revenue or higher. Internet companies boosting the highest EV/Revenue public
market multiples in 3Q14 were those that have captured a significant share of online advertising and commerce dollars. Examples include Twitter (26.1x);
Alibaba (24.0x); Zillow (19.7x); LinkedIn (12.6x); and Baidu.com (11.2x).
Median EV/Revenue Multiple Distribution – 3Q14Median EV/Revenue and EV/EBITDA Multiples – Quarterly
35
18%
27%
12%
8%
3%
5% 6%
3% 2%
17%
<= 1.0x > 1.0x
<= 2.0x
> 2.0x
<= 3.0x
> 3.0x
<= 4.0x
> 4.0x
<= 5.0x
> 5.0x
<= 6.0x
> 6.0x
<= 7.0x
> 7.0x
<= 8.0x
> 8.0x
<= 9.0x
>= 9.0x
%ofCompanies
EV/Revenue
2.7x 2.8x 3.3x 3.0x 2.7x
20.0x
22.5x
23.8x
21.3x 20.5x
3Q13 4Q13 1Q14 2Q14 3Q14
MedianMultiple

THE SEG INTERNET INDEX: PUBLIC MARKET MULTIPLES
• Public Internet companies with TTM revenue growth of 40% or higher were rewarded with a much higher median EV/Revenue multiple (11.2x) in Q3
than their slower growing peers. Among those outperformers were: Trulia (124.7%, 10.1x EV/Revenue); Twitter (117.3%, 26.1x EV/Revenue); Yelp
(66.2%, 16.7x EV/Revenue); LinkedIn (48.5%, 12.6x EV/Revenue).
• Unlike the SEG SaaS Index, where TTM EBITDA margins were inversely related to median EV/Revenue multiples, 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 3Q14, 152% 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 3.5x in Q3, 42% below the SaaS median market valuation.
• 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.
• With few exceptions, many of the most profitable public Internet companies also reported stellar TTM revenue growth. Among them were Facebook
(54.2% EBITDA margin, 63.7% revenue growth); Baidu.com (38.4% EBITDA margin, 52.8% revenue growth); Yandex (37.8% EBITDA margin, 36.2%
revenue growth); and Tencent Holdings (35.4% EBITDA margin, 36.8% revenue growth).
36
1.1x 1.4x
2.4x
3.0x 2.6x
11.2x
<= 0% > 0%
<= 10%
> 10%
<= 20%
> 20%
<= 30%
> 30%
<= 40%
> 40%
MedianEV/Revenue
TTM Revenue Growth
1.6x 1.8x 1.8x
4.5x
7.9x
6.8x
<= 0% > 0%
<= 10%
> 10%
<= 20%
> 20%
<= 30%
> 30%
<= 40%
> 40%
MedianEV/Revenue
TTM EBITDA Margin

Ad Tech Commerce Content & Media Gaming
Infrastructure Services Social Travel
• 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.
THE SEG INTERNET INDEX BY PRODUCT CATEGORY
37
Search

THE SEG INTERNET INDEX BY PRODUCT CATEGORY:
3Q14 Median YoY Change in Revenue Growth3Q14 Median TTM Revenue Growth
3Q14 Median YoY Change in EBITDA Margin3Q14 Median TTM EBITDA Margin
38
23.4%
14.1%
11.7%
14.1%
9.8%
28.7%
30.6%
63.7%
22.1%
Ad Tech
Commerce
Content & Media
Gaming
Infrastructure
Search
Services
Social
Travel
(9.3%)
(15.3%)
(19.8%)
(44.1%)
10.4%
(8.9%)
(11.2%)
17.9%
6.5%
Ad Tech
Commerce
Content & Media
Gaming
Infrastructure
Search
Services
Social
Travel
6.3%
6.3%
11.0%
21.0%
5.1%
33.8%
6.5%
10.6%
15.6%
Ad Tech
Commerce
Content & Media
Gaming
Infrastructure
Search
Services
Social
Travel
(4.5%)
3.7%
(29.9%)
(42.0%)
(27.0%)
(11.9%)
45.0%
(16.7%)
(7.1%)
Ad Tech
Commerce
Content & Media
Gaming
Infrastructure
Search
Services
Social
Travel

THE SEG INTERNET INDEX BY PRODUCT CATEGORY:
• Public Internet companies comprising the Social product category closed Q3 with a median revenue growth rate of 63.7%, more than 3x the overall
Internet median growth rate of 19.2%. The Services product category ended Q3 with a median revenue growth rate of 30.6%, more than 50% greater
than Q3’s Internet median.
• Public Internet companies comprising the Social category closed 3Q14 with the highest median EV/Revenue multiple, 12.6x, led by Twitter (26.1x) and
Facebook (18.0x).
• 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 40.5% YoY in 3Q14.
• Companies within the Search product category continued to be very profitable in Q3, posting a median EBITDA margin of 33.8%, 4x higher than the
median EBITDA margin across all Internet categories in 3Q14.
• Despite poor financial performance, the Gaming product category median EV/Revenue spiked almost 30% YoY to 2.8x in 3Q14. The category was largely
driven by the outperformance of Giant Interactive and Tencent Holdings, two Chinese companies that are demonstrating impressive growth in the huge
Asia-Pacific market.
Median 3Q14 YoY Change in EV/Revenue3Q14 Median EV/Revenue Multiples
39
2.0x
1.2x
2.7x
2.8x
1.3x
6.2x
2.6x
12.6x
5.4x
Ad Tech
Commerce
Content & Media
Gaming
Infrastructure
Search
Services
Social
Travel
8.1%
29.8%
5.5%
17.1%
Ad Tech
Commerce
Content & Media
Gaming
Infrastructure
Search
Services
Social
Travel
(40.5%)
(17.0%)
(11.0%)
(17.0%)
(12.5%)

SOFTWARE INDUSTRY M&A MARKET UPDATE

Average On-Premise Software Deal SizeU.S. Software Mergers & Acquisitions Activity
• There were 462 software M&A transactions in 3Q14. Deal activity over the past three years has remained consistently robust.
• Software M&A spending totaled $39.4 billion in 3Q14, and has increased each of the past five quarters, buoyed by a plethora of mega deals (EV>500M).
• SAP’s $7.7 billion acquisition of Concur Technologies was the largest for the quarter. In addition to SAP/Concur, Q3 featured seventeen other On-
premise/SaaS/Internet mega deals (EV > $500M), including Zillow’s acquisition of Trulia ($3.1B EV, 14.8x EV/Revenue multiple); Cognizant Technology’s
purchase of Trizetto ($2.7B, 3.8x estimate); Microsoft’s acquisition of Mojang ($2.5B); Micro Focus’ acquisition of The Attachmate Group ($2.3 billion, 2.5x
estimate); and Thoma Bravo’s acquisition of Compuware ($2.1 billion, 2.9x).
• Megadeals aside, most buyers continued to focus on small and mid-sized acquisitions in 3Q14, in line with our 2013 and 2014 Buyers Surveys, in response
to which 72% of buyers indicated they would focus on deals ranging from $10M - $99M in 2014.
• The average software M&A purchase price has increased each of the past four quarters, reaching $64M in 3Q14.
3Q14 SOFTWARE / SAAS M&A DEAL VOLUME AND SPENDING
41
$42 $41 $41 $42
$36
$39
$36 $35
$40
$43
$53
$54
$64
$0.0
$10.0
$20.0
$30.0
$40.0
$50.0
$60.0
$70.0
3Q11
4Q11
1Q12
2Q12
3Q12
4Q12
1Q13
2Q13
3Q13
4Q13
1Q14
2Q14
3Q14
TTMAverageDealValue(Millions)

• The median on-premise software exit multiple in 3Q14 inched up to
2.4x in 3Q14 after holding steady at a respectable 2.3x EV/Rev for the
past four quarters.
• Historically, a median 2.4x EV/Revenue exit multiple is at the upper
end of the valuation range for on-premise software companies. That
quarterly median valuation was beaten only twice since 2007, in
3Q10 and 2Q11, when it climbed to 2.5x before retreating the
following quarter.
SOFTWARE M&A EXIT MULTIPLES
• On a TTM basis, 40.7% of all on-premise software targets in 3Q14
were acquired for 2.0x TTM revenue or less, and 69.9% 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 Systems Management,
Engineering & PLM, and Electronic Design Automation.
• Despite Q3’s many mega deals, the quarter also featured a number of
smaller, but noteworthy transactions, including Sage Software’s
acquisition of ERP vendor Exact Software Deutschland ($22 million,
1.6x TTM revenue); and KB Advanced Technologies’ acquisition of
upstream oil & gas software provider FEESA ($19.2 million, 4.9x TTM
revenue).
Median EV/Revenue Exit Multiple DistributionMedian Exit Multiples
42
2.3x 2.3x 2.3x 2.3x 2.4x
11.5x
12.9x 13.3x
18.1x 17.7x
0.0x
2.0x
4.0x
6.0x
8.0x
10.0x
12.0x
14.0x
16.0x
18.0x
20.0x
3Q13 4Q13 1Q14 2Q14 3Q14
16.7%
24.0%
29.2%
10.4% 9.4%
2.1%
8.3%
0.0%
5.0%
10.0%
15.0%
20.0%
25.0%
30.0%
35.0%
<= 1.0x > 1.0x &
<= 2.0x
> 2.0x &
<= 3.0x
> 3.0x &
<= 4.0x
> 4.0x &
<= 5.0x
> 5.0x &
<= 6.0x
> 6.0x
TTM Revenue Exit Multiple Bins
%ofDeals-3Q14TTM

Large Vs. Smaller BuyerPublic vs. Private Target
SOFTWARE M&A: BY OWNERSHIP STRUCTURE AND SIZE
• Of the deals announced in 3Q14 with an ascertainable exit multiple,
more than four out of five software M&A transactions featured
privately-held targets.
• The median exit multiple in the third quarter was virtually the same
for both private sellers (2.4x TTM revenue) and their public
counterparts (2.5x TTM revenue).
• Public buyers in 3Q14 paid a median 2.4x TTM revenue for their
targets in 3Q14, compared to a median of 2.2x paid by private buyers.
• Buyers with revenue greater than $200 million paid a median 2.8x
TTM revenue for their targets, compared to a median 1.7x TTM
revenue purchase price paid by sub-$200 million 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). In
Q3, this match-up produced a median 3.4x EV/Revenue exit multiple.
43

SOFTWARE M&A: BY VERTICAL AND HORIZONTAL MARKETS
Horizontal & Vertical M&A Median EV/Revenue Exit MultiplesHorizontal & Vertical M&A Volume
• The median exit valuation of horizontal software companies was 2.4x TTM revenue in 3Q14, consistent with the preceding three quarters. Q3 horizontal
transactions included Dassault Systemes’ acquisition of supply chain planning solution provider Quintiq for $337.0 million (3.3x revenue); Micro Focus’
acquisition of infrastructure software solution provider The Attachmate Group for $2.3 billion (2.5x revenue); and Gemalto’s acquisition of security
software provider SafeNet Inc. for $890 million (2.4x revenue).
• Vertical software sellers accounted for the lowest percentage of total in the past five quarters.
• That said, buyers of vertical software targets valued quality over quantity. The median exit valuation of vertical software companies was 2.5x TTM
revenue in 3Q14, well above industry norms and up significantly from prior quarters.
• Q3’s more noteworthy vertical software deals included Cognizant‘s acquisition of healthcare insurance software provider Trizetto Group for $2.7 billion
(3.8x revenue); Xchanging’s acquisition of property and casualty software provider Agencyport Software for $110 million (3.4x revenue); and P2 Capital
Partner’s acquisition of legal software provider Epiq Software for $1 billion (2.2x revenue).
44
33% 39% 35% 35% 31%
67% 61% 65% 65% 69%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
3Q13 4Q13 1Q14 2Q14 3Q14
Horizontal Vertical
2.7x
1.7x
2.1x 2.1x
2.5x
2.0x
2.4x 2.5x 2.4x 2.4x
3Q13 4Q13 1Q14 2Q14 3Q14
Vertical Horizontal

SOFTWARE M&A ACTIVITY BY PRODUCT CATEGORY
• Mobile was the most active product
category by far in the third quarter,
accounting for 19.2% of all software M&A
transactions. Distant runner-ups were
Financial Services (7.3%), Content &
Document Management (5.5%), CRM,
Marketing & Sales and BI, Risk &
Compliance (4.4%)
• 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:
• Content & Document Management
transactions accounted for 5.5% of all
software M&A activity in 3Q14, but only
2.5% in 3Q13.
• CRM, Marketing & Sales deals
accounted for 4.4% of software M&A
activity in 3Q14 compared with 2.5% in
3Q13.
• Healthcare transactions accounted for
4.1% of software M&A activity in 3Q14
versus 6.3% in 3Q13.
• Network Performance Management
accounted for 0.3% of all software M&A
activity in 3Q14 compared with 1.6% in
3Q13.
45

SOFTWARE M&A EXIT VALUATIONS BY PRODUCT CATEGORY
Median EV/Revenue Exit Multiples by Software Product Category
• Among the 32 on-premise software product categories we track, nine had both sufficient deal activity and deal data to ascertain a category TTM revenue
multiple in 3Q14.
• On a TTM basis, the Systems Management and Engineering PLM categories garnered the highest median exit multiple (2.8x)
• Systems Management software transactions included Solarwinds’ 4Q13’s acquisition of Confio Software (6.7x EV/Revenue) and Thoma Bravo’s 3Q14
acquisition of Compuware (2.9x EV/Revenue). When the Confio deal falls out of our TTM calculation next quarter, its likely the median exit multiple in this
category will drop sharply.
• Notable Engineering PLM Software deals included 2Q14’s acquisition of AtegoTM by PTC; 2Q14’s acquisition of SpaceClaim by Ansys (6.0x revenue); and
4Q13’s acquisition of Delcam by Autodesk (3.1x revenue).
46
2.8x 2.8x
2.2x 2.1x
1.9x
1.6x 1.5x 1.5x
0.9x
SystemsManagement
EngineeringandPLM
OtherVerticals(A&D,
Telco,Retail,etc.)
Education
Content,Document&
BPM
SupplyChainMgmt.
Security
BI,Risk&Compliance
CRM&Marketing

Median SaaS EV/Revenue Exit MultiplesSaaS M&A Volume
• There were 118 SaaS M&A transactions in 3Q14, the most on record for any quarter and about 250% greater than three years ago.
• The median TTM EV/Revenue exit multiple of SaaS transactions was 4.1x in 3Q14, virtually the same as in three of the past four quarters.
• SaaS transactions in the third quarter that featured especially noteworthy exit multiples included SAP’s acquisition of Concur Technologies ($7.7 billion,
11.5x TTM revenue); ServiceNow’s acquisition of Neebula Systems ($100 million, 20.0x revenue estimate); and PTC’s acquisition of Aexda ($170 million,
7.0x revenue estimate).
• The median SaaS exit multiple was 71% greater than the median on-premise software exit multiple in 3Q14 (4.1x vs 2.4x).
SaaS M&A: DEAL VOLUME AND MEDIAN EXIT MULTIPLES
47
4.3x
4.1x
4.6x
4.0x 4.1x
3Q13 4Q13 1Q14 2Q14 3Q14
48
68 65
59
94 94
86
104
97 103 104 108
118
0%
5%
10%
15%
20%
25%
30%
0
20
40
60
80
100
120
140
SaaSM&ADealsasa%ofTotalSoftware
M&ADeals
#ofSaaSM&ADeals
SaaS M&A Deals SaaS as % of Software

• CRM, Marketing & Sales, and HR &
Workforce Management were the most
active SaaS M&A product categories,
accounting for 14.7% and 11.2%,
respectively, of all SaaS M&A transactions in
the third quarter.
• After five quarters of lackluster deal volume,
SaaS transactions in the CRM, Marketing &
Sales product category came roaring back
over the past two quarters, comprising
14.7% of Q3 and 13.0% of Q2 total SaaS
M&A activity, compared to only 2.1% for all
of 2013. The resurgence in the category’s
quarterly deal volume is largely attributable
to strong customer demand for marketing
related big data and marketing analytics.
• The Systems Management and BI, Risk &
Compliance product categories also
exhibited strength in 3Q14, accounting for
9.5% and 6.9%, respectively, of total SaaS
deal volume for the quarter. Both categories
benefited from rapidly ramping enterprise
adoption of SaaS deployed solutions, which
is placing increasing pressure on large, on-
premise legacy vendors to catch up.
SaaS M&A BY PRODUCT CATEGORY
48

3Q14 SaaS M&A TRANSACTIONS
49
Date Buyer Seller
Enterprise
Value (mm)
TTM Revenue
(mm) EV / Rev
09/22/14 Sage Group plc (LSE:SGE) PAI Group, Inc. $157.8 $39.0 4.1x
09/22/14 Premiere Global Services, Inc. (NYSE:PGI) TalkPoint Holdings, LLC - - -
09/22/14 Ericsson (OM:ERIC B) Apcera, Inc. - - -
09/19/14 REWE Digital GmbH commercetools GmbH - - -
09/19/14 The Hearst Corporation BranchOut, Inc. - - -
09/18/14 SAP America, Inc. Concur Technologies, Inc. (NasdaqGS:CNQR) $7,651.6 $668.0 11.5x
09/18/14 HRdirect Hello Industries Inc. - - -
09/18/14 Red Hat, Inc. (NYSE:RHT) FeedHenry Ltd.* $82.0 $4.0 20.0x
09/18/14 ParTech, Inc. Brink Software, Inc. $17.0 - -
09/18/14 Geospatial Corporation (OTCPK:GSPH) ShaleNavigator - - -
09/17/14 Cisco Systems, Inc. (NasdaqGS:CSCO) Metacloud, Inc. - - -
09/17/14 Boyser S.R.L Dexma Sensors, SL - - -
09/16/14 Callidus Software Inc. (NasdaqGM:CALD) Clicktools Ltd.* $16.4 $2.3 7.0x
09/16/14 Kenshoo, Ltd. Adquant Ltd - - -
09/16/14 OnApp Limited SoluLabs Ltd. - - -
09/15/14 Cision AB; Vocus Inc. Visible Technologies, Inc. - - -
09/15/14 Brocade Communications (Nasdaq:BRCD) Vistapointe Networks - - -
09/14/14 Oracle Corporation (NYSE:ORCL) Front Porch Digital Inc. - - -
09/12/14 Sabre Corporation (NasdaqGS:SABR) Genares Worldwide Reservation Services, Ltd. - - -
09/12/14 Genstar Capital, LLC Construction Software Technologies, Inc. - - -
09/11/14 Givex Corporation Marqui Inc. - - -
09/11/14 Ticketmaster Entertainment, LLC Eventjoy, Inc. - - -
09/11/14 Ericsson (OM:ERIC B) Fabrix Systems Ltd. $95.0 - -
09/10/14 Equiniti Limited Charter UK Ltd. - - -
09/10/14 FxPro Group Limited Quotix Limited - - -
09/09/14 Pointer Telocation Ltd. (NasdaqCM:PNTR) Thales Telematics - - -
09/09/14 QmedRx, Inc. GoEscribe - - -
09/05/14 Intercontinental Exchange, Inc. (NYSE:ICE) SuperDerivatives Inc. $350.0 - -
09/04/14 Figaro Classifieds S.A.; RegionsJob SAS Ubiposting SAS - - -
09/03/14 Symphony Technology Group Ventiv Technology Inc. - - -
09/03/14 Fidelity National Info. Services, Inc. (NYSE:FIS) Clear2Pay nv/sa* $492.7 $123.0 4.0x
09/03/14 Capita plc (LSE:CPI) Eclipse Hardware Limited - - -
09/02/14 HomeAdvisor, Inc. Mhelpdesk, Inc. - - -
09/02/14 Mixpo, Inc. ShopIgniter, Inc. - - -
09/02/14 Shenzhen Xunlei Networking Technologies Kuaipan Personal and Kansunzi Business Assets $33.0 - -
09/02/14 RealNex Ten Eight LLC - - -
09/01/14 Equiniti Limited Invigia Limited - - -
08/29/14 Omnitracs, LLC XRS Corporation (NasdaqCM:XRSC) $177.5 $53.0 3.4x
08/29/14 Morpho SA Dictao Siege - - -
08/29/14 OmniEarth Inc. IRISmaps, Inc. - - -

3Q14 SaaS M&A TRANSACTIONS (CON’T)
50
Date Buyer Seller
Enterprise
Value (mm)
TTM Revenue
(mm) EV / Rev
08/27/14 SmartFocus SA Content Savvy Inc. - - -
08/27/14 GL Education Group Limited The Test Factory Limited - - -
08/27/14 SmartFocus SA TagPoints Ltd - - -
08/26/14 Mailigen Limited Leadersend ltd. - - -
08/26/14 Google Inc. (NasdaqGS:GOOGL) ZYNC INC. - - -
08/26/14 UST Global Inc. Trulioo, Inc. - - -
08/26/14 Auctane LLC Finale Inventory - - -
08/26/14 Veeder-Root Company Inc. FuelQuest, Inc. - - -
08/25/14 Dynamic Signal Inc. PaperShare, Inc. - - -
08/21/14 Host Europe WVS Limited Sign-Up Technologies Ltd. - - -
08/20/14 GoDaddy Inc. Mad Mimi, LLC - - -
08/20/14 TeamSnap, Inc. Easy Team Manager - - -
08/19/14 Readyforce, Inc. HireBrite, LLC - - -
08/15/14 VMware, Inc. (NYSE:VMW) CloudVolumes, Inc. - - -
08/14/14 RedeHost Internet Ltda. Mailee - - -
08/14/14 INFOR, INC. SalesLogix, N.A., LLC - - -
08/13/14 Intuit Inc. (NasdaqGS:INTU) Itrios LLC - - -
08/12/14 iQU B.V. HoneyTracks GmbH - - -
08/12/14 Singapore eDevelopment Limited (Catalist:5QZ) Cloudtel Pte. Ltd. - - -
08/12/14 Kaseya International Shared Services Sàrl Scorpion Software Corp. - - -
08/12/14 SHE Software Ltd Mobile Safety Solutions Limited - - -
08/12/14 LexisNexis Risk Solutions, Inc. Coplogic, Inc. - - -
08/11/14 Thinking Phone Networks, Inc. Whaleback Systems Corporation - - -
08/11/14 International Business Machines (NYSE:IBM) Lighthouse Security Group, LLC - - -
08/11/14 Manhattan Associates, Inc. (NasdaqGS:MANH) GlobalBay Technologies Inc. - - -
08/07/14 Intuit Inc. (NasdaqGS:INTU) PaySuite Limited - - -
08/06/14 FuseMail, LLC MXSweep Limited - - -
08/05/14 Bullhorn, Inc. The Code Works Inc. - - -
08/04/14 Rocket Fuel Inc. (NasdaqGS:FUEL) [x+1], Inc. $236.0 $72.0 3.3x
08/04/14 comScore, Inc. (NasdaqGS:SCOR) MdotLabs, Inc. $4.5 - -
08/01/14 Frontline Technologies Group LLC Aspex Solutions - - -
08/01/14 cloudControl Inc. Docker, Inc., DotCloud PaaS Business - - -
07/31/14 SQAD Inc. Workhorse Software Company - - -
07/31/14 HootSuite Media Inc. Brightkit - - -
07/31/14 Oracle Corporation (NYSE:ORCL) TOA Technologies, Inc. - - -
07/31/14 Goldstar North American Mining, Inc. XFormity Technologies, Inc. (OTCPK:XFMY) - - -
07/30/14 Intuit Inc. (NasdaqGS:INTU) K.D.K. Softwares (India) Pvt. Ltd. - - -
07/30/14 j2 Global, Inc. (NasdaqGS:JCOM) Contactology, Inc. - - -
07/30/14 Qualcomm Technologies, Inc. Empowered Careers Inc. - - -
07/29/14 Ericsson (OM:ERIC B) MetraTech Corp. - - -

3Q14 SaaS M&A TRANSACTIONS (CON’T)
51
Date Buyer Seller
Enterprise
Value (mm)
TTM Revenue
(mm) EV / Rev
07/29/14 Engage Mobility, Inc. (OTCPK:ENGA) Hub Data, Inc., Certain Assets - - -
07/28/14 Twitter, Inc. (NYSE:TWTR) Madbits - - -
07/28/14 2426818 Ontario Inc. MediaMiser Ltd. $8.5 $3.6 2.4x
07/28/14 Beijing Tongtech Co., Ltd. (SZSE:300379) Neostart, Inc. $4.9 - -
07/25/14 RIB Software AG (DB:RSTA) Byggeweb A/S $25.9 - -
07/24/14 Crucible Gold Limited (ASX:CUG) Dubber Pty Ltd $5.2 - -
07/23/14 PTC Inc. (NasdaqGS:PTC) Axeda Corporation* $170.0 $24.0 7.0x
07/22/14 Docker, Inc. Orchard Laboratories Ltd - - -
07/21/14 LinkedIn Corporation (NYSE:LNKD) Bizo, Inc. $175.0 $50.0 3.5x
07/21/14 RCS Capital Corporation (NYSE:RCAP) Trupoly, Inc. - - -
07/18/14 Blackfin Capital Partners SAS Able B.V. - - -
07/17/14 Teradata Corporation (NYSE:TDC) Hadapt, Inc. - - -
07/17/14 NetSuite Inc. (NYSE:N) Venda, Inc. $50.5 - -
07/16/14 HighJump Software Inc. Atlas Products International Holdings Ltd. - - -
07/16/14 Zillow, Inc. (NasdaqGS:Z) Retsly Software, Inc. - - -
07/15/14 Equity Administration Solutions, Inc. Option Admin, Inc. - - -
07/15/14 Chef, Inc. Tower3 Inc. - - -
07/14/14 Lexalytics, Inc. Semantria LLC - - -
07/11/14 Comcast Corporation (NasdaqGS:CMCS.A) PowerCloud Systems, Inc. - - -
07/10/14 Ascentis Corporation Starfield TMS, LLC - - -
07/10/14 Salesforce.com, Inc (NYSE:CRM) RelateIQ, Inc. $391.0 - -
07/09/14 Add Shoppers, LLC Sociaby, LLC - - -
07/09/14 ServiceNow, Inc. (NYSE:NOW) Neebula Systems Ltd.* $100.0 $5.0 20.0x
07/08/14 GTCR, LLC; Opus Global Holdings Hiperos, LLC - - -
07/08/14 Top Image Systems Ltd. (NasdaqCM:TISA) eGistics, Inc. $18.0 $11.0 1.7x
07/08/14 EMC Corporation (NYSE:EMC) TwinStrata, Inc. - - -
07/08/14 Vista Equity Partners Social Solutions, Inc. - - -
07/07/14 Asure Software, Inc. (NasdaqCM:ASUR) FotoPunch Inc. $4.5 - -
07/07/14 Thoma Bravo, LLC Sparta Systems, Inc. - - -
07/07/14 Zero2Sixty Software, Inc. Conductiv Inc. - - -
07/04/14 Zimbra, Inc. Mezeo Software Corporation - - -
07/04/14 Enghouse Systems Limited (TSX:ESL) Basset AB $9.4 - -
07/02/14 EPOSability Ltd. Mylivevision Limited - - -
07/02/14 Roper Industries Inc. (NYSE:ROP) FoodLink Holdings, Inc. - - -
07/01/14 Taxware, LLC Convey Compliance Systems, Inc. - - -
07/01/14 EFactor Group Corp. (OTCPK:EFCT) Member Digital Ltd $1.0 - -

Internet M&A Volume
INTERNET M&A: DEAL VOLUME AND EXIT MULTIPLES
Median Internet EV/Revenue Exit Multiples
• After dropping sharply in the first quarter, Internet M&A deal volume increased steadily over the second and third quarters of this year.
• There were 241 Internet M&A transactions in the third quarter, a 12% increase from 2Q14’s 215 deals. In both 2013 and 2014, we’ve witnessed a
substantial decrease in M&A activity during Q1 followed by steadily increasing M&A activity during the following quarters. The first quarter has become a
time to assess and digest holiday on-line spending results, discern changing trends and establish new acquisition priorities. We expect continued M&A
growth in the fourth quarter.
• The median EV/Revenue exit multiple for Internet sellers in 3Q14 was 2.1x, a notable increase from the past four quarters.
• Leading 3Q14 Internet transactions included Facebook’s acquisition of LiveRail ($500 million, 5.0x EV/Revenue); Rakuten’s acquisition of Ebates
Performance Marketing ($1 billion, 6.0x EV/Revenue); Zillow’s acquisition of Trulia ($3.1 billion, 14.8x EV/Revenue); Varde Partners acquisition of
Bancopopular-e ($1.3 billion).
52
1.9x 1.9x 1.8x 1.7x
2.1x
3Q13 4Q13 1Q14 2Q14 3Q14
231
256
195
215
241
3Q13 4Q13 1Q14 2Q14 3Q14

INTERNET M&A: BY PRODUCT CATEGORY
TTM M&A Volume by Product Category M&A Volume by Quarter
• Internet Ad-tech remained the most active Internet M&A category, with 73 transactions in 3Q14. The third quarter’s tally was up from 1Q14’s 57 ad-tech
transactions and 2Q14’s 68 transactions, and more in line with quarterly transaction volume during the first half of 2013.
• Internet Gaming posted 21 transactions in 3Q14, a marked increase compared to 3Q13’s 8 transactions. Quarterly M&A deal volume in the Gaming
category has risen steadily over the course of the year.
• Other than Social Tech, all Internet categories posted increases in deal activity over the prior quarter.
53
Category 3Q 2013 4Q 2013 1Q 2014 2Q 2014 3Q 2014
Ad-Tech & Lead Gen 85 94 57 68 73
Commerce 44 49 38 41 49
Content & Media 36 42 50 41 43
Gaming 8 10 10 16 21
Infrastructure 39 39 21 25 32
Social Tech 19 22 18 24 23
Total 231 256 194 215 241
32.7%
20.0%19.7%
4.7%
13.1%
9.8%
Ad-Tech
Commerce
Content & Media
Gaming
Infrastructure
Social Tech

APPENDIX

THE SEG SOFTWARE INDEX COMPANIES – KEY METRICS
55
Company
A10 Networks - - 7.1x 4.0x 3.2x - - - - - 31.5% - 18.1% - - 11.5% 0.5% -3.0% -1.0% -1.7%
Accretive Health 0.4x 0.4x 0.4x 0.4x 0.4x 5.4x 5.7x 5.6x 5.2x 5.5x 4.9% -0.2% -0.2% -2.1% -3.1% 6.6% 6.5% 6.5% 6.7% 6.5%
ACI Worldwide 3.3x 3.7x 3.4x 3.1x 2.9x 17.7x 17.5x 15.7x 14.5x 13.5x 39.7% 39.5% 29.8% 33.8% 30.3% 18.9% 21.1% 21.6% 21.0% 21.7%
Activision Blizzard 2.9x 2.0x 3.0x 3.4x 3.8x 7.7x 5.7x 9.4x 11.5x 14.1x 13.1% 7.5% -5.6% -12.7% -13.9% 37.6% 35.5% 32.3% 29.5% 27.2%
Actuate 2.0x 2.2x 1.5x 1.2x 1.2x 17.1x 18.9x 14.9x 20.7x 56.7x -1.9% -0.6% -3.1% -11.0% -16.2% 11.8% 11.5% 10.2% 5.9% 2.2%
Advent Software 3.7x 5.4x 4.9x 4.6x 4.9x 21.2x 29.9x 26.2x 24.5x 20.2x 6.7% 6.9% 6.7% 6.3% 5.6% 17.3% 18.1% 18.6% 18.6% 24.1%
Allot Communications 2.9x 3.3x 4.2x 3.1x 2.4x 156.9x - - 554.0x 69.2x 7.2% -4.8% -7.8% -3.8% 8.3% 1.9% -5.1% -0.8% 0.6% 3.4%
Allscripts Healthcare Solutions 2.2x 2.3x 2.5x 2.4x 2.3x 51.1x 175.3x 352.2x 245.1x 108.9x -5.6% -7.4% -5.1% -4.4% -2.2% 4.4% 1.3% 0.7% 1.0% 2.1%
Amdocs Limited 1.5x 1.6x 1.7x 1.9x 1.8x 8.1x 8.6x 9.3x 10.1x 9.9x 2.6% 3.0% 3.6% 4.8% 5.6% 18.7% 18.6% 18.5% 18.4% 18.3%
American Software 1.7x 1.9x 2.1x 2.0x 1.9x 12.1x 12.5x 12.9x 12.5x 11.9x -6.6% -6.6% -3.2% 0.1% 4.4% 14.4% 15.4% 16.5% 16.2% 15.9%
ANSYS 8.7x 8.6x 8.0x 6.9x 7.2x 18.7x 18.4x 17.1x 14.8x 15.4x 10.5% 9.1% 7.9% 8.4% 8.0% 46.7% 46.6% 46.8% 46.8% 46.5%
Aruba Networks 2.6x 2.6x 2.9x 2.6x 2.5x 59.4x 85.3x 160.3x 105.9x 57.6x 16.1% 13.8% 11.6% 15.8% 21.5% 4.4% 3.1% 1.8% 2.4% 4.4%
Aspen Technology 9.4x 10.2x 11.3x 10.1x 9.4x 49.7x 44.6x 41.1x 33.8x 27.7x 28.1% 24.3% 27.3% 27.7% 25.7% 19.0% 22.8% 27.5% 29.9% 34.0%
Autodesk 3.0x 3.7x 4.5x 4.3x 4.7x 14.8x 18.3x 24.2x 25.1x 30.9x -0.5% -0.2% -1.7% 0.1% 3.7% 20.3% 20.1% 18.8% 17.1% 15.3%
AVG Technologies 3.0x 2.3x 2.3x 2.6x 2.3x 8.9x 7.1x 6.5x 7.3x 6.8x 27.2% 19.5% 14.4% 4.8% -3.0% 33.7% 32.6% 35.0% 35.0% 33.6%
Bango PLC 9.0x 6.6x 7.6x 6.4x 5.8x - - - - - - - -13.7% -16.5% -19.5% -35.8% -35.8% -51.5% -60.4% -71.1%
Barracuda Networks - 4.9x 7.1x 5.4x 5.0x - - - 331.7x 153.1x - - 17.5% 16.5% 16.8% 1.1% -0.1% 0.0% 1.6% 3.3%
Blackbaud 3.7x 3.7x 3.2x 3.2x 3.4x 20.7x 17.9x 16.2x 16.2x 17.5x 22.3% 15.8% 12.6% 10.1% 9.5% 17.9% 20.5% 20.0% 19.7% 19.6%
Bottomline Technologies 3.4x 4.5x 4.6x 3.9x 3.5x 36.7x 45.5x 42.3x 33.0x 31.2x 13.6% 11.5% 11.6% 13.1% 18.0% 9.3% 9.8% 10.8% 11.7% 11.1%
Broadridge Financial 1.6x 1.9x 1.9x 2.0x 2.0x 8.9x 10.0x 9.9x 10.0x 10.0x 5.5% 6.8% 7.3% 7.2% 5.2% 17.8% 18.9% 19.1% 19.6% 20.4%
Brocade Communications Systems 1.4x 1.5x 1.7x 1.6x 1.6x 6.2x 6.6x 7.1x 6.1x 6.1x 1.5% -0.7% -3.0% -2.8% -1.6% 22.2% 23.3% 24.4% 25.5% 26.2%
BSQUARE 0.1x 0.2x 0.2x 0.2x 0.2x 12.9x - - - 75.1x -3.5% -6.9% -9.2% -2.8% 1.2% 1.0% -1.8% -2.0% -1.3% 0.3%
CA Technologies 2.7x 3.0x 3.0x 2.6x 2.5x 8.1x 8.8x 8.8x 8.1x 7.9x -4.9% -4.2% -3.5% -2.1% -1.6% 33.8% 34.3% 33.9% 32.0% 31.7%
Cadence Design Systems 2.8x 2.5x 2.7x 2.8x 3.2x 12.3x 11.9x 13.0x 15.0x 16.8x 12.7% 10.1% 10.1% 7.1% 7.1% 22.4% 20.9% 20.9% 19.0% 19.0%
Cerner 5.9x 6.5x 6.6x 5.6x 6.0x 20.4x 24.9x 25.3x 21.5x 22.9x 12.3% 8.8% 8.8% 13.4% 13.4% 28.8% 26.2% 26.2% 26.2% 26.2%
Check Point Software Tech 7.2x 7.7x 8.3x 8.0x 8.2x 13.0x 13.8x 15.0x 14.6x 15.0x 4.4% 3.4% 3.8% 4.5% 5.3% 55.8% 55.8% 55.4% 55.1% 54.7%
Cimatron 1.3x 1.4x 1.8x 1.2x 1.1x 8.9x 9.0x 12.0x 8.2x 7.0x 1.6% 4.0% 4.6% 5.8% 6.4% 14.4% 15.1% 14.7% 15.0% 15.2%
Cisco Systems 2.0x 1.8x 1.8x 2.0x 2.1x 7.3x 6.1x 6.2x 7.0x 7.7x 5.5% 4.6% 1.3% -1.4% -3.0% 27.9% 28.8% 28.5% 28.7% 26.8%
Citrix Systems 4.6x 3.6x 3.5x 3.2x 3.9x 20.8x 16.5x 16.0x 14.1x 16.4x 16.5% 15.8% 12.8% 12.2% 9.4% 21.9% 21.9% 22.2% 22.7% 23.8%
ClickSoftware Technologies Ltd 1.6x 1.7x 2.4x 2.2x 1.9x 26.2x - - - - 14.7% 5.5% 3.1% 4.2% 9.1% 6.1% -0.7% -3.0% -4.5% -3.0%
CommVault Systems 6.7x 5.8x 4.9x 3.2x 3.2x 38.4x 32.8x 26.9x 17.5x 18.7x 21.7% 21.4% 20.4% 18.2% 16.5% 17.6% 17.6% 18.2% 18.2% 17.1%
Computer Programs and Sys 3.1x 3.4x 3.5x 3.3x 3.3x 12.5x 13.2x 13.0x 12.1x 11.9x 12.3% 11.2% 9.6% 8.0% 3.7% 24.9% 25.3% 26.7% 27.3% 27.9%
Compuware 3.4x 3.4x 3.3x 3.0x 2.5x 25.8x 25.0x 26.6x 22.3x 21.3x -33.5% -30.0% -31.1% -0.4% 6.9% 13.3% 13.7% 12.5% 13.2% 12.0%
Constellation 3.5x 3.6x 3.9x 3.9x 3.8x 24.8x 25.7x 30.3x 34.5x 38.8x 29.4% 36.6% 35.9% 41.7% 40.8% 13.9% 13.9% 12.8% 11.2% 9.8%
CSG Systems International 1.2x 1.4x 1.4x 1.3x 1.3x 6.8x 8.0x 8.0x 7.8x 8.3x 2.1% 0.6% -1.2% 0.3% -0.2% 17.6% 17.1% 16.8% 16.2% 16.0%
Cyan 3.3x 1.1x 0.9x 1.3x 1.4x - - - - - - 58.4% 21.6% 1.2% -12.5% -17.1% -20.7% -29.9% -40.8% -49.9%
Cyberark Software - - - - 10.7x - - - - 84.6x 29.8% 29.8% 40.1% - - 16.9% 16.9% 14.4% 13.2% 12.6%
SEGSoftware Index

56
Company
Cyren 2.4x 2.3x 3.0x 2.6x 2.3x - - - - - 21.2% 33.4% 34.9% 25.0% 15.2% -2.3% -2.1% -7.7% -10.6% -13.7%
Dassault Systèmes 5.3x 4.6x 4.4x 4.8x 5.3x 17.2x 14.8x 13.9x 15.7x 18.6x 8.4% 4.4% 1.9% 1.6% 2.3% 31.0% 30.9% 31.5% 30.3% 28.6%
DST Systems 1.5x 1.7x 1.7x 1.6x 1.6x 10.1x 10.7x 10.6x 9.9x 9.9x 5.2% 4.3% 3.2% 2.1% 2.0% 14.8% 15.4% 16.2% 16.0% 15.8%
Electronic Arts 1.9x 1.7x 1.9x 2.5x 2.5x 21.1x 14.9x 31.6x 36.1x 26.6x -7.5% -7.8% -7.5% -5.8% 1.3% 9.1% 11.7% 6.1% 6.9% 9.5%
EMC 2.3x 2.1x 2.2x 2.3x 2.5x 9.7x 8.8x 9.1x 9.5x 10.8x 6.4% 6.2% 6.9% 5.9% 5.7% 23.9% 23.8% 24.2% 23.7% 23.1%
EPIQ Systems 1.9x 2.0x 1.8x 1.7x 1.8x 9.5x 10.7x 10.6x 11.0x 13.3x 22.2% 24.9% 27.2% 23.9% 21.7% 19.9% 18.7% 16.6% 15.1% 13.2%
Evertec 7.6x 7.0x 7.4x 7.2x 6.9x 20.7x 18.6x 19.0x 18.0x 16.5x 5.4% 5.5% 4.6% 3.1% 2.2% 36.7% 37.9% 39.0% 40.0% 41.7%
Evolving Systems 3.1x 4.0x 3.6x 3.3x 3.7x 11.6x 15.0x 15.3x 15.4x 14.9x 20.2% 4.4% -4.4% -7.4% 3.9% 27.0% 26.5% 23.8% 21.4% 24.6%
F5 Networks 4.3x 4.1x 4.9x 4.6x 4.8x 13.8x 12.9x 16.1x 15.1x 15.7x 9.0% 7.6% 7.2% 11.3% 14.7% 31.2% 31.6% 30.8% 30.7% 30.8%
Fair Isaac 3.0x 3.2x 3.1x 3.1x 3.1x 11.4x 12.1x 11.9x 11.9x 11.8x 13.6% 9.9% 6.0% 3.9% 2.5% 26.1% 26.7% 25.9% 26.4% 26.0%
FalconStor Software 0.4x 0.7x 0.9x 1.0x 0.8x - - - - - -14.1% -15.2% -22.2% -22.4% -23.5% -14.5% -11.5% -12.4% -10.7% -9.2%
Fidessa 2.7x 2.6x 3.1x 3.0x 2.7x 13.5x 13.4x 15.9x 15.6x 14.6x -2.1% -1.0% 0.1% 0.1% 0.1% 19.7% 19.6% 19.4% 19.1% 18.8%
Fiserv 3.6x 3.7x 3.8x 3.8x 3.9x 12.3x 12.7x 13.1x 13.0x 13.3x 4.4% 6.5% 8.5% 9.0% 7.6% 29.0% 29.0% 28.9% 29.1% 29.3%
Fortinet 4.9x 4.6x 5.0x 4.7x 5.2x 27.4x 28.0x 35.6x 35.9x 41.9x 18.0% 17.0% 15.3% 17.4% 20.0% 18.0% 16.4% 14.1% 13.1% 12.5%
GameLoft SA 2.1x 2.6x 2.4x 2.2x 1.5x 14.0x 16.6x 15.7x 16.7x 13.7x 21.8% 16.6% 12.0% 8.7% 5.7% 15.0% 15.5% 15.6% 13.4% 11.3%
Gigamon 8.2x 5.7x 6.0x 2.7x 1.5x - - - - - 41.8% 45.1% 45.1% 28.4% 28.4% -4.6% -19.5% -19.5% -22.2% -22.2%
Glu Mobile 1.5x 2.5x 3.3x 2.4x 3.1x - - - - - 6.0% -7.4% -2.4% 18.2% 40.0% -12.2% -17.3% -13.2% -6.0% -2.4%
Gree 1.1x 1.1x 1.6x 1.3x 1.1x 3.1x 3.4x 5.0x 3.9x 3.4x -3.8% -9.7% -12.7% -12.4% -17.5% 36.1% 33.5% 31.6% 34.2% 33.5%
GSE Systems 0.2x 0.2x 0.3x 0.3x 0.2x - - - - - -9.3% -12.1% -9.0% -14.3% -16.2% -0.2% -5.0% -6.8% -8.9% -10.4%
Guidance Software 1.8x 2.0x 2.6x 2.3x 1.9x - - - - - 10.9% -3.5% -14.6% -16.4% -14.1% -2.3% -7.9% -12.3% -10.9% -9.2%
Guidewire Software 8.0x 9.0x 9.0x 6.7x 7.3x 70.0x 805.5x - - 107.4x 29.6% 25.1% 21.2% 21.2% 16.5% 11.4% 1.1% -1.1% -0.7% 6.8%
Hewlett Packard 0.6x 0.5x 0.6x 0.6x 0.7x 4.6x 4.7x 5.0x 5.4x 5.6x -7.7% -6.7% -5.6% -3.2% -0.8% 12.0% 11.6% 11.8% 11.7% 11.8%
IBM 2.3x 2.2x 2.3x 2.3x 2.3x 8.9x 8.5x 9.0x 8.9x 9.0x -3.5% -3.2% -4.6% -4.3% -4.0% 25.6% 25.6% 25.1% 25.4% 25.6%
iDream Sky Technologies - - - - 12.8x - - - - 61.7x - - 1172.4% - - -39.7% -39.7% 15.3% 20.8% 20.8%
Imperva 9.0x 7.3x 9.7x 3.4x 4.3x - - - - - 32.5% 32.5% 32.2% 26.4% 25.2% -10.1% -10.9% -16.5% -23.5% -28.7%
Informatica 4.1x 4.0x 3.9x 3.4x 2.9x 24.1x 21.2x 22.6x 18.9x 16.0x 6.5% 12.8% 16.8% 17.7% 16.6% 16.9% 18.7% 17.3% 17.9% 18.4%
Intuit 4.2x 4.6x 5.1x 4.6x 4.8x 12.2x 13.6x 16.3x 13.6x 14.6x 9.5% 11.5% 12.2% 15.1% 8.0% 34.7% 34.0% 31.4% 33.9% 33.0%
Jack Henry & Associates 3.7x 4.0x 4.1x 4.0x 4.0x 11.6x 12.4x 11.9x 11.8x 11.6x 10.0% 9.9% 9.8% 9.1% 7.1% 32.2% 32.5% 34.0% 34.1% 34.5%
Juniper Networks 1.9x 1.9x 2.4x 2.1x 1.9x 12.4x 11.6x 14.3x 12.4x 11.0x 3.1% 4.4% 7.0% 8.8% 8.7% 15.7% 16.0% 17.0% 17.0% 17.6%
King Digital Entertainment - - 3.0x 2.2x 1.5x - - 7.7x 6.0x 4.1x - - 1046.1% 555.3% 213.8% 30.6% 35.9% 38.2% 35.8% 36.3%
Konami 1.3x 1.5x 1.5x 1.5x 1.4x 10.3x 13.5x 13.3x 17.5x 12.3x -14.4% -12.9% -4.1% -3.7% -0.8% 12.8% 11.0% 11.3% 8.3% 11.6%
Magic Software Enterprises 1.5x 1.5x 2.0x 1.8x 1.5x 7.9x 7.5x 10.3x 9.2x 7.7x 15.1% 15.2% 14.7% 17.5% 16.0% 18.4% 19.5% 19.1% 19.2% 19.2%
Manhattan Associates 4.1x 5.0x 6.0x 5.5x 4.9x 17.4x 20.0x 23.1x 20.2x 18.0x 10.2% 10.4% 10.2% 13.1% 15.7% 23.7% 25.3% 25.8% 27.2% 27.4%
Mavenir Systems - 3.4x 4.0x 3.1x 2.9x - - - - - - 12.0% 37.2% 41.0% 40.3% -10.3% -7.3% -3.7% -3.4% -4.1%
MedAssets 3.3x 3.2x 3.2x 3.2x 3.1x 10.6x 10.4x 10.4x 10.9x 10.6x 9.4% 6.4% 6.3% 2.3% 1.8% 31.5% 30.7% 30.6% 29.8% 29.6%
Mentor Graphics 2.2x 2.4x 2.2x 2.0x 2.1x 12.4x 13.3x 10.4x 10.2x 11.1x 1.9% 0.8% 6.2% 10.7% 10.1% 18.0% 17.8% 20.7% 20.0% 19.1%
Merge Healthcare 2.0x 1.9x 1.9x 1.9x 2.0x 25.0x 27.6x 17.2x 16.7x 15.2x -0.9% -2.3% -6.9% -13.0% -12.3% 8.1% 6.7% 11.1% 11.6% 13.4%
SEGSoftware Index

57
Company
Microsoft 2.7x 3.0x 3.0x 3.3x 3.5x 6.9x 7.6x 7.7x 8.4x 9.6x 5.6% 11.1% 14.4% 9.6% 11.5% 39.6% 39.9% 39.0% 38.5% 37.0%
MicroStrategy 1.4x 1.8x 1.8x 1.9x 2.1x 25.5x 30.8x 26.1x 27.0x 40.3x -2.7% 4.4% 1.8% 4.7% 4.9% 5.4% 5.8% 7.0% 7.0% 5.1%
Millennial Media 2.4x 2.0x 2.5x 1.3x 0.6x - - 564.3x - - 60.3% 42.9% 45.9% 45.4% 38.2% -1.0% -1.3% 0.4% -1.8% -4.7%
MIND C.T.I. 0.8x 0.9x 1.2x 1.2x 1.8x 4.4x 6.1x 9.0x 6.8x 8.4x -9.4% -10.6% -8.6% 1.8% 16.7% 18.2% 15.3% 13.0% 17.3% 21.1%
MobileIron - - - 6.3x 5.3x - - - - - 195.1% 195.1% 158.2% - - -113.8% -113.8% -24.5% -33.8% -40.7%
Model N 3.0x 1.0x 1.7x 1.5x 1.5x 41.3x 27.0x 79.5x - - - 20.9% 14.2% 4.7% -8.3% 7.3% 3.9% 2.1% -1.9% -11.6%
Monotype Imaging Holdings 5.8x 6.3x 6.4x 5.7x 6.0x 16.0x 17.9x 18.2x 16.5x 17.8x 18.4% 14.1% 11.2% 8.3% 9.0% 36.0% 35.1% 34.9% 34.2% 34.0%
MSCI 5.4x 5.8x 5.4x 5.2x 5.1x 11.5x 12.6x 12.5x 12.3x 12.4x 1.3% 2.6% 9.0% 12.3% 16.3% 46.4% 46.2% 43.6% 42.5% 41.2%
Myriad Group AG 3.0x 3.6x 3.9x 3.3x 6.3x - - - - - 3.0% -10.8% -23.3% -20.4% -17.3% -13.8% -17.0% -16.0% -11.4% -6.8%
NetApp 1.6x 1.5x 1.5x 1.2x 1.5x 11.4x 10.2x 9.8x 7.6x 8.9x 3.0% 2.5% 1.2% -0.1% -1.7% 13.9% 14.6% 15.2% 16.2% 16.4%
Netscout Systems 2.6x 2.9x 3.5x 3.6x 3.9x 11.2x 13.2x 14.9x 15.2x 16.0x 10.6% 9.0% 11.8% 13.1% 18.7% 23.2% 22.1% 23.7% 23.6% 24.6%
NetSol Technologies 1.2x 1.2x 1.3x 1.1x 1.1x 3.0x 2.7x 3.8x 7.4x - 19.9% 22.6% 2.3% -17.9% -21.7% 41.8% 43.9% 33.4% 15.2% -8.9%
NeuStar 4.2x 3.8x 2.9x 2.2x 2.2x 9.9x 9.0x 7.2x 5.7x 6.0x 17.7% 11.0% 8.5% 7.9% 8.2% 42.0% 42.0% 39.9% 38.4% 37.6%
NICE Systems Ltd 2.3x 2.4x 2.4x 2.3x 2.2x 12.7x 13.8x 13.5x 13.2x 13.3x 8.4% 7.2% 8.0% 6.8% 6.8% 17.7% 17.5% 18.0% 17.5% 16.9%
NQ Mobile 5.8x 3.4x 4.1x 2.2x 1.2x 129.9x 115.2x 553.4x 296.0x 166.5x 117.0% 113.0% 114.3% 114.3% 114.3% 4.5% 3.0% 0.7% 0.7% 0.7%
Nuance Communications, Inc. 4.0x 3.4x 3.4x 3.6x 3.7x 26.0x 26.7x 30.4x 35.0x 40.2x 19.5% 12.3% 6.3% 4.1% 2.2% 15.4% 12.9% 11.3% 10.2% 9.1%
Omnicell 2.0x 2.0x 2.3x 2.2x 2.1x 13.8x 14.7x 16.5x 15.4x 14.5x 33.1% 27.3% 21.2% 17.3% 14.4% 14.2% 13.8% 13.8% 14.3% 14.7%
Open Text Corp 3.1x 3.7x 4.4x 4.6x 4.7x 13.3x 15.7x 18.2x 17.9x 17.0x 12.9% 9.3% 7.6% 11.8% 19.2% 23.1% 23.6% 23.9% 25.5% 27.6%
Opera 3.8x 5.5x 5.4x 4.8x 5.0x 13.6x 19.5x 20.8x 19.0x 20.5x 38.0% 36.5% 38.9% 40.7% 39.9% 27.8% 27.9% 26.0% 25.2% 24.5%
Oracle 3.7x 3.8x 4.2x 4.5x 4.3x 8.4x 8.7x 9.6x 10.2x 9.9x 1.2% 0.9% 2.0% 2.9% 3.0% 43.6% 43.5% 43.6% 43.7% 43.7%
Palo Alto Networks 7.6x 6.5x 9.6x 8.7x 10.3x - - - - - 55.3% 54.4% 49.2% 48.1% 51.0% -1.3% -1.5% -3.7% -5.2% -7.5%
Pandora Media 6.3x 8.5x 10.9x 6.7x 6.4x - - - - - 56.0% 53.5% 53.5% - - -7.5% -7.1% -7.1% -1.0% -1.4%
Parametric Technology 2.5x 2.9x 3.3x 3.2x 3.4x 13.4x 13.0x 14.8x 13.6x 14.4x 0.3% 3.3% 3.3% 4.8% 4.8% 18.8% 22.3% 22.3% 23.7% 23.7%
PDF Solutions 5.7x 6.2x 5.7x 4.6x 4.9x 20.6x 20.9x 17.6x 13.1x 13.8x 22.6% 17.8% 13.3% 12.3% 9.5% 27.4% 29.5% 32.6% 34.8% 35.4%
Pegasystems 2.6x 3.2x 3.0x 2.3x 2.6x 18.3x 19.9x 18.5x 14.8x 17.9x 12.2% 15.3% 10.2% 14.2% 16.7% 14.0% 16.2% 15.9% 15.8% 14.4%
Progress Software 3.4x 3.3x 3.1x 2.7x 2.9x 12.5x 11.9x 11.1x 9.2x 9.5x 60.6% 5.2% 1.9% -0.8% -1.2% 26.8% 28.0% 28.3% 29.3% 30.9%
Proofpoint 7.9x 8.1x 9.7x 7.2x 8.2x - - - - - 26.2% 25.3% 29.8% 33.3% 39.0% -12.1% -12.9% -12.2% -13.1% -14.8%
PROS Holdings 6.3x 6.6x 6.7x 4.6x 4.3x 96.1x 100.0x 101.6x 209.1x - 23.6% 24.6% 23.0% 22.3% 22.1% 6.5% 6.7% 6.6% 2.2% -0.6%
QAD 0.5x 0.7x 0.9x 0.9x 0.9x 12.8x 16.5x 16.9x 15.9x 15.5x 1.6% 2.8% 5.6% 9.0% 10.3% 4.2% 4.2% 5.1% 5.7% 5.7%
Qihoo 360 Technology 18.3x 17.8x 17.3x 13.0x 11.1x 82.1x 67.3x 56.7x 43.5x 41.9x 78.1% 91.5% 104.0% 123.6% 121.3% 22.3% 26.4% 30.6% 29.8% 26.6%
Qiwi 4.3x 6.1x 5.1x 4.1x 4.4x 19.7x 27.2x 22.0x 15.8x 16.2x - - 30.9% 30.0% 26.3% 21.9% 22.4% 23.1% 25.6% 27.5%
Qlik Technologies 6.1x 4.6x 4.8x 3.6x 4.3x 475.8x 478.2x 193.7x 306.0x 259.4x 22.8% 24.2% 21.1% 19.5% 18.8% 1.3% 1.0% 2.5% 1.2% 1.7%
Quality Systems 2.5x 2.8x 2.2x 1.9x 1.8x 11.8x 14.1x 13.5x 13.7x 15.6x 0.8% -2.1% -3.7% -3.4% 0.3% 21.3% 19.9% 16.5% 13.9% 11.3%
Radware 3.2x 3.4x 3.4x 3.0x 2.9x 17.0x 21.0x 21.8x 21.0x 21.7x 5.7% 2.9% 2.0% 5.1% 8.4% 18.6% 16.1% 15.4% 14.4% 13.5%
Red Hat 6.2x 5.3x 6.5x 5.4x 6.1x 30.5x 26.0x 32.5x 27.9x 32.5x 16.7% 16.0% 15.5% 15.8% 16.6% 20.2% 20.4% 20.1% 19.2% 18.9%
Redknee Solutions 3.3x 3.6x 2.6x 1.9x 1.3x 46.6x 195.9x 73.8x 33.9x 107.0x 74.4% 149.8% 226.0% 349.5% 156.4% 7.1% 1.8% 3.6% 5.6% 1.2%
Riverbed Technology 2.8x 2.8x 3.2x 3.0x 2.9x 19.6x 21.6x 22.3x 19.8x 17.7x 23.1% 24.0% 24.4% 17.7% 12.9% 14.5% 13.2% 14.2% 15.3% 16.2%
SEGSoftware Index

58
Company
Saba Software, Inc. 2.3x - - - - - - - - - 7.7% 7.7% 7.7% 7.7% 7.7% -8.7% -8.7% -8.7% -8.7% -8.7%
Sage Group 3.0x 2.9x 3.7x 3.6x 3.4x 10.6x 10.0x 12.5x 12.3x 11.7x 2.8% 2.7% -0.5% -3.7% -3.7% 28.7% 29.0% 29.3% 29.5% 29.5%
SAP 4.2x 4.4x 4.2x 3.9x 4.0x 12.9x 13.2x 12.2x 11.5x 11.7x 9.8% 6.6% 3.6% 2.7% 2.2% 32.4% 33.1% 34.2% 34.4% 34.5%
Sapiens International 1.6x 2.0x 2.2x 2.1x 2.1x 12.1x 16.0x 19.6x 18.3x 17.8x 31.2% 21.5% 18.8% 17.6% 16.6% 13.3% 12.3% 11.3% 11.3% 11.6%
Silver Spring Networks 3.7x 2.8x 2.1x 1.6x 1.5x - - - - - 8.0% 34.5% 66.1% 62.8% 3.5% -27.3% -19.8% -10.8% -7.3% -22.7%
Software AG 2.1x 2.4x 2.4x 2.4x 1.8x 8.2x 9.4x 9.6x 9.6x 7.5x -7.9% -8.1% -7.1% -6.0% -8.2% 26.0% 25.6% 25.0% 24.8% 23.6%
SolarWinds 9.1x 7.9x 9.1x 7.8x 7.9x 19.5x 17.5x 21.9x 20.4x 22.5x 26.8% 24.2% 24.7% 27.0% 29.3% 46.6% 45.4% 41.7% 38.1% 35.2%
Sourcefire 0.9x 0.8x 1.1x 1.0x 1.0x - 33.6x 10.0x 7.7x 8.2x -8.1% 5.6% 25.2% 36.0% 43.9% -7.9% 2.4% 10.6% 13.6% 12.7%
Splunk 20.7x 23.6x 28.6x 15.8x 13.3x - - - - - 54.7% 51.4% 52.1% 51.3% 51.6% -14.5% -16.4% -23.3% -31.3% -40.8%
SS&C 5.6x 5.8x 5.7x 5.7x 5.8x 14.4x 14.7x 14.4x 14.3x 15.0x 70.1% 47.5% 29.1% 14.9% 7.1% 38.8% 39.5% 39.5% 39.6% 39.0%
Stratasys 11.7x 12.9x 10.9x 7.7x 8.3x 69.4x 75.3x 65.5x 49.3x 57.1x 82.4% 113.4% 125.0% 101.2% 88.0% 16.9% 17.1% 16.6% 15.7% 14.6%
Symantec 2.3x 2.1x 1.9x 1.9x 2.2x 8.5x 7.4x 6.5x 6.6x 7.5x 1.8% -0.6% -3.3% -3.3% -3.5% 27.4% 28.5% 29.1% 29.1% 29.0%
Synchronoss Technologies 4.4x 4.0x 3.6x 3.4x 4.2x 21.1x 19.8x 16.0x 14.1x 16.5x 20.3% 23.7% 27.5% 28.5% 27.8% 20.7% 20.2% 22.2% 24.0% 25.7%
Synopsys 2.6x 2.5x 2.7x 2.6x 2.7x 14.3x 13.5x 14.9x 14.6x 15.3x 13.0% 11.7% 8.9% 6.0% 5.8% 18.4% 18.4% 18.3% 17.6% 17.8%
Take-Two Interactive 1.4x 1.5x 0.6x 0.6x 0.7x 22.1x - 3.0x 3.5x 3.5x 57.6% 13.9% 130.9% 93.5% 106.3% 6.2% -2.8% 20.2% 18.4% 19.3%
Tangoe 3.8x 3.5x 3.5x 2.8x 2.5x 42.3x 38.9x 40.8x 34.6x 34.2x 38.1% 30.8% 22.3% 17.7% 14.4% 8.9% 9.0% 8.7% 8.1% 7.2%
TeleCommunication Systems 0.5x 0.6x 0.6x 0.8x 0.7x 6.7x 7.0x 10.2x 12.1x 9.9x 2.5% -12.6% -25.7% -26.9% -24.8% 8.0% 7.9% 5.9% 6.3% 7.4%
TeleNav 0.2x 0.4x 0.3x 0.5x 0.6x 2.5x 7.6x 91.8x - - -6.7% -0.9% -6.2% -16.9% -21.6% 7.7% 5.4% 0.4% -8.6% -15.7%
Teradata 3.4x 2.5x 2.5x 2.3x 2.2x 15.0x 11.3x 11.0x 9.5x 9.5x 3.6% 2.5% 1.0% 3.6% 3.6% 22.8% 22.3% 23.1% 23.7% 23.2%
The Descartes Systems Group 4.9x 5.4x 5.6x 5.4x 6.1x 17.2x 19.1x 19.9x 19.0x 21.3x 17.1% 18.0% 19.2% 20.6% 17.2% 28.4% 28.2% 28.1% 28.2% 28.7%
TIBCO Software 3.4x 3.4x 3.0x 2.8x 3.2x 18.5x 18.7x 16.4x 15.3x 20.2x 3.3% 4.4% 4.7% 5.4% 2.4% 18.6% 18.1% 18.5% 18.0% 15.6%
Trend Micro 3.3x 3.5x 2.9x 3.0x 3.2x 9.9x 10.3x 8.6x 8.7x 9.0x 7.7% 11.3% 15.4% 13.5% 9.8% 33.0% 33.7% 33.9% 34.7% 35.1%
Tyler Technologies 6.2x 7.8x 7.3x 5.9x 6.3x 32.0x 41.3x 38.5x 30.2x 30.8x 16.4% 14.6% 14.7% 15.2% 17.2% 19.3% 19.0% 18.9% 19.5% 20.5%
Ubisoft Entertainment 0.8x 0.8x 1.3x 1.6x 1.3x 2.2x 2.2x 3.6x 4.9x 4.0x 17.3% 16.3% -3.0% -19.8% -19.8% 37.3% 37.7% 35.6% 32.9% 32.9%
Varonis Systems - - 13.8x 6.1x 4.9x - - - - - - - 39.7% 43.7% 38.0% -3.8% -6.5% -6.8% -11.1% -14.0%
VASCO Data Security 1.5x 1.4x 1.3x 2.0x 2.6x 14.0x 15.0x 12.7x 18.6x 19.5x -12.5% -8.0% 0.7% 0.9% 14.3% 11.1% 9.1% 10.6% 10.9% 13.3%
Verint Systems Inc 2.6x 2.6x 3.0x 2.8x 3.7x 14.6x 14.4x 16.7x 17.0x 25.5x 4.5% 7.0% 8.1% 13.2% 18.3% 17.8% 18.2% 18.1% 16.5% 14.5%
Verisk 8.1x 8.1x 7.4x 6.7x 6.8x 16.7x 16.8x 16.0x 14.6x 14.9x 3.1% 1.7% 13.3% 13.3% 14.2% 48.5% 48.5% 46.1% 45.6% 45.4%
VMWare 6.4x 5.9x 6.9x 6.8x 6.6x 25.3x 22.5x 24.4x 24.4x 25.2x 16.3% 14.7% 13.1% 13.4% 15.0% 25.2% 26.3% 28.1% 27.8% 26.0%
Zynga 1.2x 2.0x 3.3x 3.0x 2.7x 9.6x 13.7x 39.5x 70.5x - -11.8% -21.3% -31.8% -36.5% -37.6% 12.2% 14.6% 8.4% 4.2% -2.5%
SEGSoftware Index

THE SEG SOFTWARE INDEX METRICS BY PRODUCT CATEGORY
59
Billing & Service Management 3Q13 4Q13 1Q14 2Q14 3Q14
EV/EBITDA 9.9x 9.0x 9.3x 10.1x 9.9x
EBITDA Margin 18.7% 18.6% 18.5% 18.4% 21.1%
TTM Revenue Growth (YoY) 17.7% 4.4% 3.6% 4.8% 8.2%
TTM EBITDA Growth (YoY) 3.9% 3.4% 1.6% 1.7% -3.3%
TTM Earnings Growth (YoY) -16.7% -9.6% -4.8% -9.2% -3.3%
Current Ratio 2.6 2.3 2.4 2.7 2.7
Cash as Percent of Market Cap 17.9% 12.8% 16.1% 15.0% 15.8%
Enterprise Value Growth (YoY) 29.3% 30.7% 27.2% 33.1% 23.2%
Business Intelligence 3Q13 4Q13 1Q14 2Q14 3Q14
EV/EBITDA 17.7x 18.8x 16.2x 15.1x 16.0x
EBITDA Margin 15.5% 17.1% 16.6% 16.8% 15.0%
TTM EBITDA Growth (YoY) -14.2% -11.0% -0.7% 3.5% 0.7%
Current Ratio 2.0 2.1 2.0 2.0 2.0
Enterprise Value Growth (YoY) 19.4% 29.0% 15.0% 3.3% -13.0%
Development Platforms 3Q13 4Q13 1Q14 2Q14 3Q14
EV/EBITDA 12.9x 15.4x 13.0x 15.1x 21.3x
EBITDA Margin 18.4% 19.5% 19.1% 19.2% 18.9%
TTM Revenue Growth (YoY) -1.9% -0.6% -3.1% -0.8% 1.2%
TTM EBITDA Growth (YoY) -18.9% -14.2% -1.8% -2.8% -3.3%
Current Ratio 2.0 2.1 1.9 1.7 1.8
Enterprise Value Growth (YoY) 8.2% 16.1% 6.3% 3.2% -13.0%
Engineering & PLM 3Q13 4Q13 1Q14 2Q14 3Q14
EV/EBITDA 14.8x 14.8x 14.9x 14.8x 15.4x
EBITDA Margin 18.9% 20.5% 20.8% 19.5% 19.0%
TTM EBITDA Growth (YoY) 4.9% 11.2% 17.6% 7.5% 10.0%
TTM Earnings Growth (YoY) 6.1% 5.0% 11.9% 9.4% 17.7%
Current Ratio 2.1 2.3 2.3 2.2 2.0
Enterprise Resource Planning 3Q13 4Q13 1Q14 2Q14 3Q14
EV/EBITDA 12.1x 12.5x 12.5x 12.3x 11.7x
EBITDA Margin 28.7% 29.0% 29.3% 29.5% 29.5%
TTM EBITDA Growth (YoY) -2.3% 4.1% 4.2% 4.5% 14.5%
TTM Earnings Growth (YoY) -17.1% -6.8% 0.2% 16.0% 7.7%
Current Ratio 1.1 1.1 1.2 1.2 1.2
Financial & Accounting 3Q13 4Q13 1Q14 2Q14 3Q14
EV/EBITDA 12.3x 13.6x 15.7x 13.3x 13.5x
EBITDA Margin 26.1% 26.7% 25.9% 25.6% 26.0%
Current Ratio 1.4 1.6 1.3 1.2 1.3
Gaming 3Q13 4Q13 1Q14 2Q14 3Q14
EV/EBITDA 12.2x 13.5x 11.3x 14.1x 13.0x
EBITDA Margin 13.9% 13.6% 17.9% 15.9% 15.5%
TTM Revenue Growth (YoY) 15.2% 10.7% -3.6% -4.8% 0.2%
TTM EBITDA Growth (YoY) 19.4% 32.1% 5.7% -3.9% -13.9%
TTM Earnings Growth (YoY) 25.3% -17.6% -18.9% -50.8% -15.1%
Current Ratio 2.4 2.0 2.4 3.0 3.2
Healthcare 3Q13 4Q13 1Q14 2Q14 3Q14
EV/EBITDA 13.2x 14.4x 15.0x 14.6x 14.8x
EBITDA Margin 17.8% 16.9% 15.2% 14.1% 14.1%
Current Ratio 2.0 1.7 1.8 1.6 1.6
IT Conglomerates 3Q13 4Q13 1Q14 2Q14 3Q14
EV/EBITDA 8.4x 8.5x 9.0x 8.9x 9.6x
EBITDA Margin 32.4% 33.1% 34.2% 34.4% 34.5%
Current Ratio 1.2 1.2 1.3 1.2 1.2
Mobile Solutions/Content 3Q13 4Q13 1Q14 2Q14 3Q14
EV/EBITDA 13.6x 19.5x 39.5x 19.0x 20.5x
EBITDA Margin 7.7% 5.4% 5.9% 4.2% 0.7%
Net Income Margin 2.3% 1.6% -1.4% -2.7% -3.1%
TTM EBITDA Growth (YoY) 0.0% 0.0% -39.5% 0.1% 0.1%
TTM Earnings Growth (YoY) -36.6% -34.9% 63.3% 156.3% 147.0%
Current Ratio 2.1 2.2 2.6 2.9 2.8
Networking & Network Perf Mgmt 3Q13 4Q13 1Q14 2Q14 3Q14
EV/EBITDA 17.0x 16.9x 18.9x 20.4x 19.5x
EBITDA Margin 12.4% 8.1% 7.1% 7.8% 8.2%
Net Income Margin -3.2% -2.8% -1.7% -0.3% 1.4%
TTM EBITDA Growth (YoY) -6.4% -25.0% -11.6% -8.8% 14.8%
TTM Earnings Growth (YoY) 10.0% 6.9% -0.8% 3.3% 9.7%
Current Ratio 2.1 2.3 2.6 2.7 2.7
Security 3Q13 4Q13 1Q14 2Q14 3Q14
EV/EBITDA 11.4x 13.8x 10.0x 11.6x 15.0x
EBITDA Margin 11.1% 2.4% 10.6% 10.9% 12.5%
TTM EBITDA Growth (YoY) -6.9% -34.5% -20.4% -7.3% -3.2%
TTM Earnings Growth (YoY) -0.6% 4.4% 5.3% 0.9% 26.3%
Current Ratio 1.4 1.5 1.7 1.8 1.9

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