SaaStock 2016 - European SaaS Exit

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A talk on SaaS exits in Europe and how to achieve exits for your SaaS business

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SaaStock 2016 - European SaaS Exit

  1. 1. M A R K M A C L E O D , @ S TA R T U P C F O A C H I E V I N G M E A N I N G F U L E X I T S I N S A A S
  2. 2. Private & Confidential | 2 A g e n d a Introduction European SaaS Exit Trends How to achieve your exit? 01 02 03
  3. 3. Private & Confidential | 3 I n t r o d u c t i o n M A R K M A C L E O D F O U N D E R & P R E S I D E N T S U R E PAT H C A P I TA L PA R T N E R S Mark has over 14 years experience as a CFO for leading companies such as FreshBooks, Shopify, Tungle and many others. He also spent 3 years as a General Partner at Real Ventures, Canada’s largest and most active seed stage venture fund. He raised hundreds of millions in capital from investors in Canada, the US and Asia. In addition, Mark has sold companies to Airbnb, Blackberry, Rackable Systems, Return Path and others.
  4. 4. Private & Confidential | 4 S u r e P a t h : O u r P u r p o s e Helping you fund, grow and exit your startup The process of raising growth capital is very different from raising early stage capital It is cheaper than ever to start companies, but more expensive than ever to build market leaders. If that’s your aspiration, you need growth capital We help startups prepare for growth stage and help them raise the capital needed to become market leaders We have sat on both sides of the table. We have funded, grown and exited many companies We offer up that experience through ongoing coaching and mentoring. A low touch, high impact way to help you grow There are few credible choices for advisors to facilitate sub $100M exits. We fill that gap We work with you to facilitate the BD and Corp Dev intros that pave the way to an eventual exit If you decide to exit, we manage the process for you from start to finish SurePath maximizes your optionality: We make sure you know what it takes to build a market leader and capitalize you towards that goal. We ensure you are always in the minds of strategic buyers so that if they decide to make a move in your space, you are in the conversation. You can then decide; Keep going or exit? Growth Funding Strategic Guidance Exits
  5. 5. Private & Confidential | 5 S u r e P a t h & S M B •We have been part of some the most successful SMB SaaS companies •We have deep relationships with SMB investors and buyers •SurePath is committed to becoming the leading strategic financial advisor to the global SMB software market
  6. 6. European SaaS Acquisition Activity
  7. 7. Private & Confidential | 7 E x i t s b y T y p e Source: pitchbook.com 19 30 24 24 35 22 28 27 15 20 16 1 1 1 2 1 1 1 0 5 10 15 20 25 30 35 40 2014 Q1 2014 Q2 2014 Q3 2014 Q4 2015 Q1 2015 Q2 2015 Q3 2015 Q4 2016 Q1 2016 Q2 2016 Q3 Number of Deals European SaaS Exits by Type Merger/Acquisition IPO
  8. 8. Private & Confidential | Priate 67% Public 33% Buyer by Type 8 B u y e r L o c a t i o n & T y p e Source: pitchbook.com North America 41% Asia & Others 7% Europe 52% Buyer By Geography
  9. 9. Private & Confidential | 9 B u y e r s Who’s buying European SaaS companies Source: pitchbook.com
  10. 10. Private & Confidential | 10 E x i t s b y A g e Note: Some companies does not have a disclosed age Source: pitchbook.com 35 104 44 43 27 0 20 40 60 80 100 120 0 to 5 years 6 to 10 years 11 to 15 years 16 to 20 years > 20 years Number of Companies Exit By Age of Company
  11. 11. Private & Confidential | 11 E x i t s b y S i z e Source: pitchbook.com 192 54 12 7 3 0 50 100 150 200 250 Not Disclosed $0m - $50 $50M - $100M $100M - $200M > $200M Exit Values
  12. 12. Private & Confidential | 12 F u n d i n g S t a t u s Source: pitchbook.com 7% 40%53% Funding Status of Exited Companies PE VC Non-funded $39.0m $13.3m $18.7m $0.0m $5.0m $10.0m $15.0m $20.0m $25.0m $30.0m $35.0m $40.0m PE VC Non-funded Median Valuation 4.7x 3.7x 2.0x 0.0x 1.0x 2.0x 3.0x 4.0x 5.0x PE VC Non-funded Valuation /Rev Multiple
  13. 13. How to achieve your exit
  14. 14. Private & Confidential | 14 Exit rule #1
  15. 15. Private & Confidential | 15 Exit rule #2
  16. 16. Private & Confidential | 16 Exit rule #3 Source: SaaStr
  17. 17. Private & Confidential | 17 Exit rule #4
  18. 18. Private & Confidential | 18 Buyer Types Founder ✓ Product-driven ✓ Based on desire ✓ Top down ✓ No prior relationship needed Manager ✓ Fact-driven ✓ Based on clear business case ✓ Pushed up to CEO ✓ Need evidence (joint customers)
  19. 19. Private & Confidential | 19 Drivers of deal value ✓ Alternatives (runway, competition) ✓ Scarcity ✓ Mortal enemies ✓ Growth (fear) ✓ Market leadership (2 way) ✓ Does the buyer’s CEO Want this? ✓ On strategy ✓ Currency ✓ Time and timing (including markets)
  20. 20. Private & Confidential | T h e r o l e o f A d v i s o r s 20 ✓ Should you hire one? Yes ✓ What to look for: Relevant relationships, completed deals and expertise. Senior people involved ✓ Role: ✓ Prepare you ✓ Quarterback ✓ Create / manage demand ✓ Good cop/ bad cop ✓ Objectivity ✓ Create urgency
  21. 21. Shubham Datta Associate shubham@surepathcapital.com 647.972.6834 Rena Wang Analyst rena@surepathcapital.com 416.897.8922 Mark MacLeod Founder & President mark@surepathcapital.com 416.843.6004

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