Out of the Cloud of Cloud Computing: KPMG s perspective on Financial and IP Aspects September 14, 2011
Our case study begins.. 25 20 Support 15 10 License 5 0 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
Our case study begins.. 25 20 15 10 5 0 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
Amount of capital paid in prior to an IPO for public SaaS companies $M Blackboard 100.7 Concur Technologies 30.2 Constant Contact 37.3 DealerTrack 48.0 DemandTrack 42.0 HireRight 29.2 Kenexa 54.5 LivePerson 41.6 NetSuite 84.9 Omniture 66.9 RightNow Technologies 32.2 Salary.com 5.7 Salesforce.com 64.5 Solera 5.7 SuccessFactors 54.5 Taleo 36.9 Ultimate Software 25.1 Vocus 26.4 Mean 43.5 Median 39.5 2-3X the amount of capital required for a traditional model software company to reach profitability/ipo. Wachovia Securities, May 2008 the state of the SaaS market
Amount of capital paid in prior to an IPO for public SaaS companies $M Blackboard 100.7 Concur Technologies 30.2 Constant Contact 37.3 DealerTrack 48.0 DemandTrack 42.0 HireRight 29.2 Kenexa 54.5 LivePerson 41.6 NetSuite 84.9 Omniture 66.9 RightNow Technologies 32.2 Salary.com 5.7 Salesforce.com 64.5 Solera 5.7 SuccessFactors 54.5 Taleo 36.9 Ultimate Software 25.1 Vocus 26.4 Mean 43.5 Median 39.5 2-3X the amount of capital required for a traditional model software company to reach profitability/ipo. These public SaaS companies, on average, raised about $25M at strong valuation mark ups, and invested this amount primarily on sales and marketing in the year prior to going public. Wachovia Securities, May 2008 the state of the SaaS market
Amount of capital paid in prior to an IPO for public SaaS companies $M Blackboard 100.7 Concur Technologies 30.2 Constant Contact 37.3 DealerTrack 48.0 DemandTrack 42.0 HireRight 29.2 Kenexa 54.5 LivePerson 41.6 NetSuite 84.9 Omniture 66.9 RightNow Technologies 32.2 Salary.com 5.7 Salesforce.com 64.5 Solera 5.7 SuccessFactors 54.5 Taleo 36.9 Ultimate Software 25.1 Vocus 26.4 Mean 43.5 Median 39.5 2-3X the amount of capital required for a traditional model software company to reach profitability/ipo. These public SaaS companies, on average, raised about $25M at strong valuation mark ups, and invested this amount primarily on sales and marketing in the year prior to going public. Salesforce.com raised $47M in November 1999 at a 224% step up in valuation and IPO d just five months later in March 2000. Wachovia Securities, the state of the SaaS market
Amount of capital paid in prior to an IPO for public SaaS companies $M Blackboard 100.7 Concur Technologies 30.2 Constant Contact 37.3 DealerTrack 48.0 DemandTrack 42.0 HireRight 29.2 Kenexa 54.5 LivePerson 41.6 NetSuite 84.9 Omniture 66.9 RightNow Technologies 32.2 Salary.com 5.7 Salesforce.com 64.5 Solera 5.7 SuccessFactors 54.5 Taleo 36.9 Ultimate Software 25.1 Vocus 26.4 Mean 43.5 Median 39.5 2-3X the amount of capital required for a traditional model software company to reach profitability/ipo. These public SaaS companies, on average, raised about $25M at strong valuation mark ups, and invested this amount primarily on sales and marketing in the year prior to going public. Salesforce.com raised $47M in November 1999 at a 224% step up in valuation and IPO d just five months later in March 2000. Data shows that Wall Street gives much better valuations (multiples that are possibly 2x-3x greater) to those SaaS companies able to demonstrate strong revenue and subscriber growth rates. Wachovia Securities, the state of the SaaS market
License vs. SAAS A US Based 3rd Party Reseller License Government (OCS) Grants Tech IP 15% withholding
License vs. SAAS Total available OCS funding budget in million NIS Government (OCS) Grants Tech IP
License vs. SAAS Total approved OCS budgets and funding vs. requested budgets Government (OCS) Grants Tech IP
License vs. SAAS Number of companies approved vs. requested Government (OCS) Grants Tech IP
License vs. SAAS Technology Risk Innovation Government (OCS) Grants Tech IP
Contractual terms
Being a service organization
Achieving growth through acquisitions? SAAS Target $7M
Achieving growth through acquisitions? A US based Venture Capital fund SAAS Target Tech IP
Achieving growth through acquisitions EARNOUT? SAAS Target
Achieving growth through acquisitions SAAS Target
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