the software industry financial report

Q1 2

015

Software Equity Group, L.L.C.

12220 El Camino Real

Suite 320

San Diego, CA 92130

[email protected]

(858) 509-2800

The Software Industry

Financial Report

SOFTWARE EQUITY GROUP | Q1 2015 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 15-17

The SEG Software Index: Public Market Multiples 18-19

The SEG Software Index by Product Category 20

The SEG Software Index by Product Category: Financial Performance 21

The SEG Software Index by Product Category: Public Market Multiples 22

Public SaaS Company Financial and Valuation Performance

The SEG SaaS Index 24

The SEG SaaS Index: Financial Performance 25-27

The SEG SaaS Index: Public Market Multiples 28-30

The SEG SaaS Index by Product Category: Financial Performance 31

The SEG SaaS Index by Product Category: Public Market Multiples 32

Public Internet Company Financial and Valuation Performance

The SEG Internet Index 34

The SEG Internet Index: Financial Performance 35-37

The SEG Internet Index: Public Market Multiples 38-39

The SEG Internet Index by Product Category 40

The SEG Internet Index by Product Category: Financial Performance 41

The SEG Internet Index by Product Category: Public Market Multiples 42

SOFTWARE INDUSTRY FINANCIAL REPORT CONTENTS


3

SOFTWARE INDUSTRY FINANCIAL REPORT CONTENTS

Software Industry M&A Market Update

Software/SaaS M&A Deal Volume and Spending 44

Software M&A Exit Multiples 45

Software M&A by Ownership Structure and Size 46

Software M&A by Vertical and Horizontal Markets 47

Software M&A Deal Volume by Product Category 48

Software M&A Exit Valuations by Product Category 49

SaaS M&A Deal Volume and Exit Multiples 50

SaaS M&A by Product Category 51

SaaS M&A 1Q15 Transactions 52-54

Internet M&A: Deal Volume and Exit Multiples 55

Internet M&A: By Product Category 56

Appendix

SEG Software Index Key Metrics 58-61

SEG Software Index Key Metrics by Product Category 62-63

SEG SaaS Index Key Metrics 64-65

SEG SaaS Index Key Metrics by Product Category 66

SEG Internet Index Key Metrics 67-69

SEG Internet Index Key Metrics by Product Category 70

1Q15 Select Public Sellers 71

1Q15 Mega Deals 72

1Q15 Most Active Buyers 73

About Software Equity Group 74


ABOUT SOFTWARE EQUITY GROUP


5

• 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


6

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


8

U.S. AND GLOBAL GDP

U.S. GDP (% YoY Change) Global GDP (% YoY Change)

Sources: Worldbank, The Economist, Council of Economic Advisors, BEA and Statista

• In January, the IMF forecasts a gradually improving global economy that remained vulnerable to a host of economic and geopolitical downside risks. It predicted global GDP will grow at 3.5% in 2015.

• The IMF’s April Update reaffirmed a 3.5% global GDP growth rate in 2015, but also confirmed ongoing risks to achieving the forecast, including continued pay down of public, corporate and household debt, which could slow spending; weakened oil prices that has adversely impacted producer nations, but increased disposable income in oil importing countries (ie. U.S., China, Euro area and India); and significant currency exchange rate fluctuations which could impact manufacturing imports and exports., especially in the U.S, the Euro Zone, and Japan.

• The IMF acknowledged its forecasts could also be imperiled by recent geopolitical events and renewed threats of defaults and recessions among EEC member countries.

2.70%

1.80%

-0.30%

-2.80%

2.50%

1.60%

2.30% 2.20% 2.40%

3.00%

-4%

-3%

-2%

-1%

0%

1%

2%

3%

4%

2006 2007 2008 2009 2010 2011 2012 2013 2014 2015*

Annual growth of the Real Gross Domestic Product (GDP) of the United Stats from 2006 to 2015

5.56% 5.67%

3.04%

0.10%

5.43%

4.14%

3.37% 3.28% 3.31% 3.50%

0%

1%

2%

3%

4%

5%

6%

7%

2006 2007 2008 2009 2010 2011 2012 2013 2014 2015*

Global gross domestic product (GDP) growth (YOY) from 2004 to 2015


9

U.S. GDP AND UNEMPLOYMENT

• Early year forecasts were for U.S. GDP to grow an average of 3% in 2015. Late in the first quarter, most economists had revised their projection downward to 1% by quarter’s close. Actual growth proved even more disappointing, inching up only 0.2% in 1Q15 (according to the BEA). Temporary setbacks, such as an unusually harsh winter, port delays, and weak oil prices, all took their toll.

• Economists predict U.S. GDP will recover strongly in Q2 and Q3 of 2015, as it did in 2014, when GDP growth rebounded to 4.6% and 5%, respectively, after negative growth in 1Q14. The Wall Street Journal’s survey of more than 60 leading economists projects 3.1% growth in Q2, 3.0% growth in Q3, and 2.8% growth in the final quarter. 2015.

• The Labor Department reported the unemployment rate at the end of 1Q15 was 5.5%, a noteworthy decline from 1Q14’s 6.7%, and the lowest unemployment rate since 2008. The Wall Street Journal’s survey of economists projects the unemployment rate will continue to decline, reaching nearly 5.0% by year end, and dropping to 4.8% by year end 2016.

• The labor participation rate closed 1Q15 at 62.7% and has been flat for the past 12 months, a 35 year low that can be attributed to an aging baby boomer population that is beginning to retire. This leads to a natural demographic decline in the participation rate.

-5.4%

-0.5%

1.3%

3.9%

1.7%

3.9%

2.7% 2.5%

-1.5%

2.9%

0.8%

4.6%

2.3% 1.6%

2.5%

0.1%

2.7% 1.8%

4.5% 3.5%

-2.1%

4.6%

5.0%

2.2%

0.2%

-8.0%

-6.0%

-4.0%

-2.0%

0.0%

2.0%

4.0%

6.0%

8.0%

10.0%

12.0%

1Q09 2Q09 3Q09 4Q09 1Q10 2Q10 3Q10 4Q10 1Q11 2Q11 3Q11 4Q11 1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14 4Q14 1Q15

GDP % Growth Unemployment Rate


10

GLOBAL IT SPEND

Sources: Gartner , Forrester

• Assuming reasonably stable currency exchange rates, Gartner projected at the outset of 2015 that worldwide IT spending would grow at a constant currency rate of 3.7% in 2015. That was before the significant rise in value of the U.S. dollar against most other currencies, a phenomenon that has had a materially adverse effect on worldwide IT spending. In April, Gartner revised IT spending to grow (in constant currency terms) at a rate of 3.1% in 2015.

• In U.S. dollar value terms, global IT spending is projected to shrink 1.3% in 2015, dropping to $3.7 trillion. By 2018, spending is forecast to exceed $4.1 trillion.

• Forrester estimates software will account for 27% 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 Category Global IT Spending (% YoY Change)

6.0%

-10.0%

8.0%

6.0%

2.0% 2.0% 2.1% 3.1%

2008 2009 2010 2011 2012 2013 2014 2015 (F)


11

E-COMMERCE AND DIGITAL ADVERTISING SPEND

Sources: comScore, IAB, IBD, and Forrester

• E-commerce retail sales in the U.S. totaled $82.8 billion in 4Q14 (the latest data available), up 16% YoY. The increase marks the 21st consecutive quarter of YoY growth, and the 17th consecutive quarter of double digit growth.

• Mobile commerce accounted for $10.7 billion, or 12.9% of the 4Q14 E-Commerce total, according to comScore. In addition, YoY growth in mobile commerce has been outpacing digital E-Commerce spend for quite some time. In 4Q14, mobile commerce grew at a pace of 28.9%, while desktop commerce expanded by 14.3%.

• The digital commerce growth rate of 17% in Q4 far exceeded the 4.4% growth in total consumer discretionary spending, confirming that the shift to online shopping continues unabated.

• According to Forrester, U.S. digital ad revenues will total $37.6 billion in 2019, with the most growth coming from video advertising. Forrester predicts video advertising on desktop devices alone will grow 14% annually until 2019, when it will contribute 55% of total desktop display ad revenue across the Web.

Worldwide Digital Advertising Spend U.S. E-Commerce Spend

-10%

-5%

0%

5%

10%

15%

20%

25%

$0

$2

$4

$6

$8

$10

$12

$14

$16

Yo

Y C

ha

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e

Dig

ita

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isin

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($

B)

Digital Advertising Spend ($B) YoY Percent Change

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

$30.0

$40.0

$50.0

$60.0

$70.0

$80.0

$90.0

YO

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E-C

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me

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Sp

en

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$B

)

Mobile E-Commerce Spend ($B)

Desktop E-Commerce Spend ($B)

Aggregate YoY Percent Change


12

STOCK MARKET PERFORMANCE

• Technology stock prices, as well as the major stock market indices, all declined in January. However, the DOW, S&P and NASDAQ, as well as our SEG Software and SaaS indices rebounded in February and March, and each closed the quarter with positive returns.

• The Nasdaq posted the best return of the three major stock indices in 1Q15, finishing up 4.5%. The S&P and DOW finished up 1.3% and 0.9%, respectively.

• The SEG Software Index closed 1Q15 up 4.5% year-to-date, equivalent to the return of the tech heavy NASDAQ. The SEG Software index has been steadily improving since October of 2014. Companies in this index have benefited from their considerable size, strong EBITDA margins, and the long-term compounding of recurring revenue from annual maintenance and support contracts and more recent SaaS subscriptions.

• After declining 5% in 2014, the SEG SaaS Index closed 1Q15 up 3.4%. The gain was due in large part to investor concerns that stalled GDP growth could imperil SaaS revenue growth. Their fears were allayed when public SaaS companies posted median revenue growth of 30.6% for 1Q15.

• The SEG Internet Index lagged our other two tracking indices, posting a median -3.4% YTD return in 1Q15.

(8.0%)

(6.0%)

(4.0%)

(2.0%)

0.0%

2.0%

4.0%

6.0%

8.0%

January-15 February-15 March-15

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


14

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 137 public software companies*.

• The number of public companies comprising the SEG Software Index has declined steadily over the past ten years, as many on premise providers have been acquired, taken private or migrated to a SaaS business model.

* A number of on-premise software companies are transitioning to subscription based delivery and pricing models; however their SaaS revenue contribution is insufficient for them to be deemed primarily SaaS. ** See appendix for a complete list of companies in The SEG Software Index and detailed financial and trading metrics

SEG - Software: Median Metrics

Measure 1Q14 2Q14 3Q14 4Q14 1Q15

EV/Revenue 3.1x 2.9x 2.9x 3.0x 3.0x

EV/EBITDA 15.3x 14.6x 15.0x 15.2x 15.5x

EV/Earnings 27.3x 25.7x 25.6x 27.9x 28.6x

Gross Profit Margin 64.2% 65.0% 65.1% 66.0% 65.9%

EBITDA Margin 18.0% 17.5% 17.6% 18.0% 18.5%

Net Income Margin 9.4% 8.2% 8.6% 8.7% 8.0%

TTM Revenue Growth 8.9% 8.3% 8.0% 7.7% 8.3%

TTM Total Revenue ($M) $509.0 $538.1 $598.2 $613.9 $720.2

TTM EBITDA Growth 6.4% 5.7% 5.7% 6.3% 5.1%

TTM Total EBITDA ($M) $95.9 $101.6 $103.6 $104.7 $106.5

Cash & Eq ($M) $185.3 $221.0 $189.6 $196.6 $211.2

Current Ratio 2.0 2.0 2.1 2.0 1.9

Debt / Equity Ratio 2.2% 2.0% 1.8% 2.5% 8.7%


THE SEG SOFTWARE INDEX: FINANCIAL PERFORMANCE

• After seven consecutive quarters of slowing growth, the median TTM revenue growth rates of public on-premise software companies have improved modestly, rising to 7.9% in Q4 and 8.3% in 1Q15.

• Almost one in four of our Software Index listed companies reported negative revenue growth; more than half grew revenue by a meager 10% or less.

• Predictably, the few public on-premise software companies growing revenue 30%+ were focused on three of IT’s hottest product categories: mobility (MOMO, 1330.3%), security (Cyberark Software, 55.7%), and business intelligence (PROS Holdings, 28.3%),

• The consolidation of on-premise software companies over the past 15 years has resulted in an ecosystem of behemoths whose growth has stalled due to much more focused, prioritized and constrained enterprise IT spending, and a shift toward cloud-based solutions and subscription pricing, which has negatively impacted revenue recognition.

TTM Revenue Growth Rate Distribution – 1Q15 Median Revenue Performance – Quarterly

15

7.0%

7.2%

7.4%

7.6%

7.8%

8.0%

8.2%

8.4%

8.6%

8.8%

9.0%

$0

$100

$200

$300

$400

$500

$600

$700

$800

1Q14 2Q14 3Q14 4Q14 1Q15

TT

M R

ev

en

ue

Gro

wth

TT

M T

ota

l R

ev

en

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TTM Total Revenue ($M) TTM Revenue Growth

23%

30%

23%

11%

4%

9%

<= 0% > 0%<= 10%

> 10%<= 20%

> 20%<= 30%

> 30%<= 40%

> 40%

% o

f C

om

pa

nie

s

TTM Revenue Growth



• Slowed growth has prompted most to maintain a keen eye on expenses. The median EBITDA margin of public on-premise software companies has remained mostly unchanged over the past five quarters, closing 1Q15 at 18.2%.

• Fewer than half of public on-premise software companies achieved EBITDA margins of 20%+ in the first quarter.

• Check Point Software, a security software provider, was a standout exception, leading the pack once again in 1Q15 with an EBITDA margin of 54.0%, only slightly lower than last quarter’s 55.7%. Check Point’s extraordinary profitability can be attributed in part to a strong, well-performing channel that reduces its cost of sales. Curiously, Check Point also spends substantially less on R&D (9% of revenue) compared to their category peers (15% of total revenue).

• We anticipate the median EBITDA margin of public software companies will rise modestly in 2Q15, in large part due by keeping R&D spending relatively flat while modestly increasing S&M spending.

TTM EBITDA Margin Distribution – 1Q15 Median EBITDA Margin Performance – Quarterly

16

17.9% 17.4% 17.4% 18.1% 18.2%

1Q14 2Q14 3Q14 4Q14 1Q15

EB

ITD

A M

arg

in 18%

15%

23%

26%

14%

4%

<= 0% > 0%<= 10%

> 10%<= 20%

> 20%<= 30%

> 30%<= 40%

> 40%

% o

f C

om

pa

nie

s

TTM EBITDA Margin



Median Margin Performance Median Operating Ratios

17

0%

5%

10%

15%

20%

25%

1Q14 2Q14 3Q14 4Q14 1Q15

% o

f R

ev

en

ue

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

• OpEx: Median spending on operations by public on-premise software companies in 1Q15 was consistent with historic norms: 15.1% for Research & Development, 20.5% for Sales & Marketing, and 8.6% for General & Administrative.

• Over the past year, median S&M, R&D and G&A expenses as a percent of revenue have remained flat.

• Median S&M spending as a percent of total revenue by on-premise public software companies lagged far behind their SaaS counterparts, which continued to place significant bets on new customer acquisition (20.5% for on-premise vs. 39.7% for SaaS).

• Despite declining revenue growth over the past several quarters, the median EBITDA margin of public on-premise software providers has modestly improved over the past four quarters, reaching 18.5% in 1Q15.

64.2% 65.0% 65.1% 66.0% 65.9%

18.0% 17.5% 17.6% 18.0% 18.5%

0%

10%

20%

30%

40%

50%

60%

70%

1Q14 2Q14 3Q14 4Q14 1Q15

% M

arg

in

Gross Profit Margin EBITDA Margin Net Income Margin


• The EV/Revenue multiples of smaller public on-premise software companies – those with revenues <$100 million – lagged well behind their larger counterparts, but has steadily improved over the past three quarters.

• The convergence of EV/Rev median public market valuations of mid size, large and very large on-premise software companies is another indication of changing investor sentiment, perhaps suggesting investors no longer believe the very largest on-premise providers will be able to maintain their market dominance simply by virtue of size and incumbency.

THE SEG SOFTWARE INDEX: PUBLIC MARKET MULTIPLES

• The median EV/Revenue market multiple for public on-premise software providers was 3.0x in 1Q15.

• The ~3.0x median EV/Revenue valuation that’s prevailed over the past five quarters despite lackluster growth, reflects the continuing bull market, investor enthusiasm for technology stocks, and continued reliance on perpetual license revenue recognition.

• The higher EV/Rev valuation premium enjoyed by the largest on-premise software providers declined in the first quarter and is now on par with their smaller counterparts.

• We believe investor enthusiasm for the behemoths will continue to wane over the remainder of 2015, absent a surge in stock prices overall, as many lose faith in the ability of these household names to redefine their missions, redirect their resources, and better capitalize on their significant number of blue-chip customers.

EV/Revenue Multiples by Size (TTM Revenue) – Quarterly Median EV/Revenue and EV/EBITDA Multiples – Quarterly

18

3.1x 2.9x 2.9x 3.0x 3.0x

15.3x 14.6x 15.0x 15.2x 15.5x

1Q14 2Q14 3Q14 4Q14 1Q15

Me

dia

n M

ult

ipe

EV/Revenue EV/EBITDA

0.0x

1.0x

2.0x

3.0x

4.0x

1Q14 2Q14 3Q14 4Q14 1Q15

Me

dia

n E

V/

Re

ve

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Revenue Greater Than $1 billion Revenue Between $500 million & $1 billion

Revenue Between $100 million & $500 million Revenue Less Than $100 million


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 1Q15. The median EV/Revenue multiples of companies growing TTM revenue greater than 40% increased 41% from the prior quarter.

• Members of Q1’s 40%+ growth club that rewarded investors handsomely in 1Q15 came from the fastest growing product category, mobile. Select 1Q15 outperformers included: Momo (1330% TTM revenue growth, 40.5x EV/Revenue), and Qihoo 360 Technology (107% TTM revenue growth, 5.1x EV/Revenue).

• On-premise software providers that grew TTM revenue 30% to 40% in 1Q15 posted a median market multiple of 4.0x, roughly equivalent to the prior quarter’s mark of 4.1x TTM revenue.

• The median market multiples of on-premise software companies that generated EBITDA margins less than 10% lagged well behind their more profitable counterparts. In the absence of meaningful growth, profitability matters.

• Still, investors did not differentiate much between modestly and moderately profitable of on-premise software companies, awarding comparable multiples to each group.

• Investors did take special note in 1Q15 of on-premise providers with EBITDA margins greater than 40%, conferring a median EV/Revenue multiple of 6.8x, or 126% higher than the index median. Examples included: Check Point Software (54% EBITDA margin, 9.4x EV/Revenue multiple); Ansys (46%, 7.4x); Verisk (45%, 6.9x); and Evertec (42%, 6.3x).

EV/Revenue Multiples vs. TTM EBITDA Margins – 1Q15 EV/Revenue Multiples vs. TTM Revenue Growth – 1Q15

19

2.0x

2.8x

3.9x

3.4x

4.1x 4.4x

<= 0% > 0%<= 10%

> 10%<= 20%

> 20%<= 30%

> 30%<= 40%

> 40%

Me

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V/

Re

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TTM Revenue Growth

1.9x 1.8x

2.8x 3.3x 3.1x

6.8x

<= 0% > 0%<= 10%

> 10%<= 20%

> 20%<= 30%

> 30%<= 40%

> 40%

Me

dia

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Re

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TTM EBITDA Margin


20

THE SOFTWARE INDEX BY PRODUCT CATEGORY

• The SEG Software Index is segmented into 16 product categories.

• Market valuations, TTM growth rates and EBITDA margins vary widely quarter to quarter, and category to category. For example, Business Intelligence providers had a median EV/Revenue market valuation of 3.0x in 3Q14 when revenue growth was 15.4%; median EV/Revenue for the category rose to 3.7x in 1Q15 despite a revenue growth rate that had declined to 10.0%.

• See Appendix for the complete list of companies within each product category.

SEG Software Index

Category EV/Revenue EV/EBITDA TTM Revenue Growth EBITDA Margin

1Q14 2Q14 3Q14 4Q14 1Q15 1Q14 2Q14 3Q14 4Q14 1Q15 1Q14 2Q14 3Q14 4Q14 1Q15 1Q14 2Q14 3Q14 4Q14 1Q15

Billing & Service Management

2.9x 2.1x 1.8x 1.9x 1.9x 9.3x 10.1x 9.9x 9.4x 9.7x 3.6% 4.8% 8.2% 12.9% 18.3% 18.5% 18.4% 21.1% 26.1% 26.6%

Business Intelligence 3.1x 3.3x 3.0x 3.3x 3.7x 17.3x 14.7x 14.9x 14.4x 16.7x 11.8% 13.7% 15.4% 13.8% 10.0% 16.6% 16.8% 16.4% 15.6% 15.7%

Development Platforms 2.5x 2.4x 1.8x 1.9x 2.3x 10.7x 9.4x 9.5x 9.9x 9.2x 1.9% -0.8% 1.2% 4.4% 4.5% 20.1% 19.2% 19.2% 19.3% 18.7%

Engineering & PLM 4.4x 4.3x 4.7x 3.4x 3.7x 16.4x 14.9x 15.6x 16.0x 15.7x 7.9% 8.4% 7.4% 6.1% 8.3% 20.8% 20.0% 19.9% 19.9% 20.9%

Enterprise Resource Planning

3.7x 3.6x 3.4x 3.4x 4.2x 12.5x 12.2x 11.9x 11.9x 13.0x 2.0% 2.7% 3.0% 2.9% 2.5% 29.3% 29.5% 29.0% 28.4% 28.4%

Financial & Accounting 3.4x 3.1x 3.1x 3.0x 3.1x 13.1x 12.6x 13.2x 13.8x 15.1x 8.5% 4.7% 2.5% 6.1% 5.2% 25.9% 25.6% 26.0% 25.2% 23.3%

Gaming 1.7x 1.9x 1.5x 1.3x 1.7x 11.2x 14.1x 13.3x 12.2x 12.5x -3.6% -4.8% 0.2% 1.0% -3.2% 18.5% 15.9% 15.5% 18.6% 18.5%

Healthcare 2.4x 2.3x 2.2x 2.4x 2.6x 14.6x 14.6x 14.8x 14.6x 16.2x 3.0% 0.1% 1.1% 3.2% 3.9% 15.4% 14.1% 14.1% 16.6% 16.0%

IT Conglomerates 3.0x 3.3x 3.5x 3.6x 3.1x 8.7x 8.6x 9.6x 9.5x 8.7x 2.0% 2.7% 2.2% 2.9% 2.5% 34.0% 33.5% 32.8% 33.4% 34.2%

Mobile Solutions/Content 3.5x 2.8x 2.7x 2.2x 2.1x 39.9x 34.6x 16.2x 22.2x 23.3x 24.9% 0.0% 0.0% 0.0% 22.9% 3.7% 2.5% -0.3% 4.7% 3.8%

Networking & Network Performance Management

3.1x 2.8x 2.4x 2.1x 2.1x 15.3x 18.2x 18.6x 20.4x 17.3x 11.6% 8.8% 8.7% 12.7% 17.5% 1.5% 2.2% 4.4% 7.0% 9.9%

Security 3.0x 3.2x 3.2x 5.1x 3.9x 10.2x 11.6x 12.1x 16.7x 17.2x 17.5% 13.5% 14.3% 17.6% 18.7% 10.5% 10.9% 12.5% 7.6% 6.7%

Storage, Data Management & Integration

2.2x 2.4x 2.5x 2.6x 2.5x 9.1x 8.1x 8.9x 9.1x 9.3x 4.1% 2.9% 2.1% 3.1% 3.2% 17.8% 18.0% 17.7% 17.5% 17.3%

Systems Management 5.0x 4.5x 5.0x 4.4x 4.1x 18.9x 17.8x 19.4x 18.5x 17.4x 13.0% 13.3% 15.8% 16.2% 16.3% 25.9% 25.7% 25.3% 25.0% 25.4%

Vertical - Finance 4.5x 4.3x 4.4x 4.4x 5.3x 13.9x 13.3x 13.7x 14.4x 16.6x 8.6% 8.1% 6.3% 5.6% 5.6% 26.7% 26.8% 29.3% 29.9% 30.3%

Vertical - Other 3.2x 3.2x 3.4x 3.7x 4.0x 26.5x 24.3x 24.4x 27.0x 29.1x 21.2% 21.2% 16.6% 16.5% 16.3% 12.8% 13.5% 11.6% 11.8% 11.9%

Median 3.1x 2.9x 2.9x 3.0x 3.0x 15.3x 14.6x 15.0x 15.2x 15.5x 8.9% 8.3% 8.0% 7.7% 8.3% 18.0% 17.5% 17.6% 18.0% 18.5%


21

THE SEG SOFTWARE INDEX BY PRODUCT CATEGORY: FINANCIAL PERFORMANCE

1Q15 YoY Change in Median Revenue Growth 1Q15 Median TTM Revenue Growth

1Q15 YoY Change in Median EBITDA Margin 1Q15 Median TTM EBITDA Margin

(15.2%)

141.4%

4.4%

22.1%

(38.6%)

(10.7%)

27.8% 22.1%

(8.1%)

50.1%

6.6%

(23.1%)

25.4%

(35.1%)

(23.0%)


Business Intelligence

Development Platforms

Engineering & PLM


Financial & Accounting

Gaming

Healthcare

IT Conglomerates

Mobile Solutions/Content

Networking & Network Performance…

Security


Systems Management

Vertical - Finance

Vertical - Other

18.3%

10.0%

4.5%

8.3%

2.5%

5.2%

(3.2%)

3.9%

2.5% 22.9%

17.5%

18.7%

3.2%

16.3%

5.6%

16.3%




Engineering & PLM



Gaming

Healthcare

IT Conglomerates



Security


Systems Management

Vertical - Finance

Vertical - Other

26.6%

15.7%

18.7%

20.9%

28.4%

23.3%

18.5%

16.0%

34.2%

3.8%

9.9%

6.7%

17.3%

25.4%

30.3%

11.9%




Engineering & PLM



Gaming

Healthcare

IT Conglomerates


Networking & Network…

Security

Storage, Data Management &…

Systems Management

Vertical - Finance

Vertical - Other

43.7%

(5.3%)

(7.3%)

0.2%

(2.8%)

(10.2%)

0.2%

3.6%

0.4% 3.1%

(36.6%)

(2.3%) (2.0%)

13.2%

(7.3%)




Engineering & PLM



Gaming

Healthcare

IT Conglomerates



Security


Systems Management

Vertical - Finance

Vertical - Other

409.1%

548.4%


22

• In 1Q15, nine product categories achieved median EV/Revenue multiples above the SEG Software Index median of 3.0x, led by Vertical Finance (5.3x), Enterprise Resource Planning (4.2x), and Systems Management (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 1Q15 with a median EV/Revenue multiple of 1.7x, the lowest of our 16 product categories, in-line with the -10.7% YoY median change in TTM revenue growth. 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 9 of 16 product categories in 1Q15, although there was little correlation between median TTM revenue growth rates and market multiples. The nine categories with higher YoY EV/Revenue multiples included: Business Intelligence, Enterprise Resource Planning, Gaming, Healthcare, IT Conglomerates, Security, Storage, and Vertical – Finance (i.e. software providers focused on the financial services vertical), and Vertical-Other.

THE SEG SOFTWARE INDEX BY PRODUCT CATEGORY: PUBLIC MARKET MULTIPLES

Median 1Q15 YoY Change in EV/Revenue 1Q15 Median EV/Revenue Multiples

1.9x

3.7x

2.3x

3.7x

4.2x

3.1x

1.7x

2.6x

3.1x

2.1x

2.1x

3.9x

2.5x

4.1x

5.3x

4.0x




Engineering & PLM



Gaming

Healthcare

IT Conglomerates



Security


Systems Management

Vertical - Finance

Vertical - Other

(32.7%)

17.4%

(5.3%)

(14.7%)

15.0%

(8.4%)

1.3%

6.2%

3.7%

(40.5%)

(34.3%)

30.7%

15.0%

(18.6%)

18.0%

24.7%




Engineering & PLM



Gaming

Healthcare

IT Conglomerates



Security


Systems Management

Vertical - Finance

Vertical - Other


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 57 publicly traded, pure-play SaaS companies*.

* See appendix for complete list of companies in the SEG SaaS Index

24

SEG - SaaS: Median Metrics Measure 1Q14 2Q14 3Q14 4Q14 1Q15


EV/EBITDA 46.2x 50.9x 52.5x 61.7x 53.9x



EBITDA Margin -8.1% -8.9% -9.9% -12.8% -12.6%

Net Income Margin -17.4% -17.9% -17.5% -23.7% -23.4%




TTM Total EBITDA ($M) -$11.2 -$15.8 -$9.8 -$10.4 -$12.6

Cash & Eq ($M) $77.1 $85.7 $92.6 $92.4 $113.6

Current Ratio 2.2 2.2 2.1 2.1 2.0



THE SEG SaaS INDEX: FINANCIAL PERFORMANCE

• The median TTM revenue growth rate of Public SaaS companies in 1Q15 was 30.6%, up from 29.8% in 1Q14. We anticipate only marginally higher growth in Q2, mostly due to floundering GDP growth and IT spending.

• The median TTM revenue of public SaaS companies was $142.2M in 1Q15, a significant YoY increase from 1Q14’s $108.0M, In part, the revenue growth is attributable to wider, and deeper, enterprise adoption of hosted solutions; and in part the revenue growth is inorganic, as the group has become increasingly acquisitive.

• Salesforce continued to lead the pack by several furlongs, reporting 1Q15 TTM revenue of $5.4B, over 6x greater than the next largest public SaaS company. Still, many public SaaS companies reached critical revenue mass (>$350 million) in 1Q15, a feat made more difficult by a revenue model that requires deferring a significant percentage of booked revenue. SaaS providers with revenues of $350M+ can now be found among a wide array of product categories and industry sectors, including Workday (HCM/Financial, $787.9M); DealerTrack (Automotive, $854.4M); RealPage (Real Estate, $404.6M); and Service-now (IT Service Mgmt., $682.6M).

• Medians alone do not capture the standout performances of the most successful SaaS companies. Nearly one in four public SaaS companies grew TTM revenue by 50% or more. As further testament to the widespread 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: Castlight Health (251.4%); FireEye (163.5%); New Relic (82.2%); Tableau Software (77.5%); DealerTrack (77.4%); Zendesk (76.4%); and Workday (68.0%).

TTM Revenue Growth Rate Distribution– 1Q15 Median Revenue Performance – Quarterly

25

2%

9%

14%

25%

16%

9%

26%

<= 0% > 0%<= 10%

> 10%<= 20%

> 20%<= 30%

> 30%<= 40%

> 40%<= 50%

> 50%

% o

f C

om

pa

nie

s

TTM Revenue Growth 0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%

35.0%

$0

$20

$40

$60

$80

$100

$120

$140

$160

1Q14 2Q14 3Q14 4Q14 1Q15

TT

M R

ev

en

ue

Gro

wth

TT

M T

ota

l R

ev

en

ue




• The median EBITDA margin of public SaaS companies remained negative, closing 1Q15 at -12.6%.

• Almost two out of three (63%) public SaaS companies are unprofitable, and nine out of ten have EBITDA margins below the 20% median of their on-premise software peers.

• And for the time being, investors are untroubled by the operating losses, if the strong correlation between their EV/Revenue market multiples and TTM revenue growth rates (see slide 29) is any indication.

• 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, for the year ended January 2015, Workday reported a $248M net loss, but was cash flow positive from operations to the tune of $102M.

TTM EBITDA Margin Distribution– 1Q15 Median EBITDA Margin Performance – Quarterly

26

(8.1%) (8.9%)

(9.9%)

(13.2%) (12.6%)

1Q14 2Q14 3Q14 4Q14 1Q15

EB

ITD

A M

arg

in

63%

16% 14%

4% 4%

<= 0% > 0%<= 10%

> 10%<= 20%

> 20%<= 30%

> 30%

% o

f C

om

pa

nie

s

TTM EBITDA Margin




27

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

1Q14 2Q14 3Q14 4Q14 1Q15

% o

f R

ev

en

ue


67.3% 66.1% 65.8% 65.5% 66.1%

-8.1% -8.9% -9.9% -12.8% -12.6%

-17.4% -17.9% -17.5% -23.7% -23.4%

-25%

-15%

-5%

5%

15%

25%

35%

45%

55%

65%

1Q14 2Q14 3Q14 4Q14 1Q15

% M

arg

in


• OpEx: Public SaaS companies continue to spend heavily on sales & marketing in order to drive revenue growth and capture market share.

• In 1Q15, public SaaS companies invested a median 39.7% of total revenue on sales & marketing, almost double their on-premise counterparts.

• R&D spending as a percent of revenue remained almost flat in 1Q15, inching up to 20.3% from 19.9% a year earlier. Public SaaS companies in 1Q15 spent 5.2% more on R&D as a percent of revenue then their on premise peers, as they endeavored to expand their offerings, enhance their technology and platforms, and address new markets

• The GAAP losses of public SaaS companies accelerated throughout 2014, bottoming out at a -12.8% median EBITDA margin in 4Q14, before recovering slightly and ending 1Q15 at a -12.6%.


THE SEG SaaS INDEX: PUBLIC MARKET MULTIPLES

• At the close of 1Q15, the median EV/Revenue market multiple of public SaaS companies was 5.7x, down 22% YoY, but up slightly improved from last quarter’s median multiple of 5.6x. The retreat in 2014 reflected growing investor concerns about overheated technology sector stock prices. Impressive revenue growth in Q1 helped to spur investor enthusiasm, resulting in a slight uptick in the median SaaS market valuation.

• Yet investors were goggle-eyed about the prospects of a good number of public SaaS providers. Almost one-third of the companies in the SEG SaaS Index achieved a median EV/Revenue multiple of 8x or higher in 1Q15, and public SaaS companies continued to trade at a significant premium to their on-premise peers (5.7x vs. 3.0x median EV/Revenue). Although public SaaS companies have historically enjoyed trading multiples about double their on-premise peers, the differential is shrinking. 1Q15’s premium of 90% greater was significantly lower than 1Q14’s 135% premium.

• 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– 1Q15 Median EV/Revenue and EV/EBITDA Multiples – Quarterly

28

7.3x 6.8x 6.3x 5.6x 5.7x

46.2x 50.9x 52.5x

61.7x

53.9x

1Q14 2Q14 3Q14 4Q14 1Q15


2%

5%

13%

18%

5%

9% 7%

9%

4%

27%

<= 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

% o

f C

om

pa

nie

s

EV/Revenue



• In 1Q15, 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 13.0x in 1Q15.

• In prior quarters, investors deemed profitability to be an unacceptable tradeoff for accelerated growth. That trend may be ameliorating. While the vast majority (63%) of public SaaS companies posted operating losses but a median EV/Rev of 5.6x, the relatively few SaaS players reporting an EBITDA of >10% to < 30% received markedly higher market valuations.

• After public SaaS company valuations retreated in 2014, profitability has become a more important factor. The spread between EV/Rev valuations for unprofitable vs. the most profitable SaaS companies has shrunk significantly from 123% in 1Q14 to 16% in 1Q15.


29

0.0x

3.8x

2.7x

6.0x 5.7x

10.0x

13.0x

<= 0% > 0%<= 10%

> 10%<= 20%

> 20%<= 30%

> 30%<= 40%

> 40%<= 50%

> 50%

Me

dia

n E

V/

Re

ve

nu

e

TTM Revenue Growth

5.6x

3.9x

7.5x

8.2x

4.8x

<= 0% > 0%<= 10%

> 10%<= 20%

> 20%<= 30%

> 30%

Me

dia

n E

V/

Re

ve

nu

e

TTM EBITDA Margin


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 13.2x in 1Q15.

• 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 68%. All but three companies (Tableau Software, Qualys) in the top 25% had a negative EBITDA margin as of 1Q15.

• In contrast, the median TTM revenue growth rate of those comprising the bottom 25% of EV/Revenue multiples was 18.1%, and one third of these companies were profitable.

30


THE SEG SaaS INDEX BY PRODUCT CATEGORY: FINANCIAL PERFORMANCE

1Q15 YoY Change in Median Revenue Growth 1Q15 Median TTM Revenue Growth

1Q15 YoY Change in Median EBITDA Margin 1Q15 Median TTM EBITDA Margin

31

28.5%

27.0%

39.1%

31.2%

CRM &Marketing

ERP &Supply Chain

VerticallyFocused

WorkforceManagement

(14.0%)

(24.1%)

2.0%

13.3%

CRM &Marketing

ERP &Supply Chain

VerticallyFocused

WorkforceManagement

(12.1%)

(2.1%)

7.2%

(7.3%)

CRM &Marketing

ERP &Supply Chain

VerticallyFocused

WorkforceManagement

(8.1%)

(54.1%)

(31.4%)

83.1%

CRM & Marketing

ERP & Supply Chain

Vertically Focused

Workforce Management


THE SEG SaaS INDEX BY PRODUCT CATEGORY: PUBLIC MARKET MULTIPLES

• Public SaaS companies comprising the Vertically Focused category posted the highest median public market valuation (6.9x EV/Revenue) of our four SaaS tracking categories in 1Q15. The category is led by Castlight Health (13.0x EV/Revenue multiple) and Veeva Systems (10.6x EV/Revenue). As we saw in on-premise software a number of years ago, as the delivery model matures, new vertically oriented best of breed vendors emerge and draw investors to their competitively differentiated offerings in large vertical markets that allow them compete well against larger horizontal players.

• Vertically focused SaaS companies also achieved the highest TTM revenue growth rate in 1Q15, 39.1%. This category includes healthcare spend management SaaS provider, Castlight Health (251% TTM revenue Growth), construction sector SaaS vendor, Textura (54% TTM revenue growth) and life sciences SaaS vendor, Veeva Systems (49% TTM revenue growth).

• The CRM & Marketing category saw the only positive YOY change in Median EV/Rev. This was in part due to a few very well performing companies IPO’ing in the past 12 months – Zendesk, which saw a median EV/Rev of 13.3x in 1Q15 on TTM revenue growth of 76% and Hubspot, which saw a median EV/Rev of 10.0x in 1Q15 on TTM revenue growth of 49%.

1Q15 YoY Change in Median EV/Revenue 1Q15 Median EV/Revenue Multiple

32

6.8x

6.6x

6.9x

6.7x

CRM &Marketing

ERP &Supply Chain

VerticallyFocused

WorkforceManagement

91.6%

(26.4%)

(14.2%)

(36.2%)

CRM &Marketing

ERP &Supply Chain

VerticallyFocused

WorkforceManagement


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 104 public Internet companies*.

* See appendix for complete list of companies in the SEG Internet Index

34

SEG - Internet: Median Metrics

Measure 1Q14 2Q14 3Q14 4Q14 1Q15


EV/EBITDA 17.4x 19.1x 18.6x 20.3x 16.7x



EBITDA Margin 8.7% 8.5% 8.0% 7.5% 8.2%

Net Income Margin 1.8% 0.1% -0.2% 0.5% 0.1%




TTM Total EBITDA ($M) $31.0 $31.9 $32.2 $29.4 $28.4

Cash & Eq ($M) $161.4 $198.0 $204.8 $195.2 $212.7

Current Ratio 2.6 2.5 2.5 2.4 2.2



THE SEG INTERNET INDEX: FINANCIAL PERFORMANCE

• Approximately 56% 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 15.9% growth in 2Q14 from 20.1% in 1Q14, median TTM revenue of the SEG Internet Index grew to 19.4% in 4Q14 and remained flat in 1Q15.

• Once again demonstrating the Internet is an ecosystem of unequals, 22% of public Internet providers far outpaced the pack, posting TTM revenue growth greater than 40% in 1Q15. These high flyers included LendingClub (115.4%), Qihoo (107.2%), and Mitel Networks (106.0%).

• Conversely, 29% of public Internet companies struggled to advance, reporting TTM revenue growth of 10% or less in 1Q15. Examples include Google, Yahoo!, Zynga, Orbitz, and Monster Worldwide.

TTM Revenue Growth Rate Distribution – 1Q15 Median Revenue Performance – Quarterly

35

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

$430

$435

$440

$445

$450

$455

$460

$465

$470

$475

$480

1Q14 2Q14 3Q14 4Q14 1Q15

TT

M R

ev

en

ue

Gro

wth

TT

M T

ota

l R

ev

en

ue


17%

12%

24%

17%

8%

22%

<= 0% > 0%<= 10%

> 10%<= 20%

> 20%<= 30%

> 30%<= 40%

> 40%

% o

f C

om

pa

nie

s

TTM Revenue Growth



• The median EBITDA margin of the SEG internet Index dropped slightly over the prior quarter, declining some 90 basis points YoY.

• Almost 30% of SEG Internet Index companies were unprofitable in 1Q15, compared to 24% the prior quarter. The median S&M spend as a percent of revenue of public Internet companies remained virtually unchanged in 1Q15 at 25.3%.

• 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 (62.0%), Mail.ru Group (48.6%) and Netease (42.2%).

• 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 first quarter.

TTM EBITDA Margin Distribution – 1Q15 Median EBITDA Margin Performance – Quarterly

36

8.7% 8.5% 8.0% 8.2% 7.8%

1Q14 2Q14 3Q14 4Q14 1Q15

EB

ITD

A M

arg

in

29% 29%

19%

7%

11%

5%

<= 0% > 0%<= 10%

> 10%<= 20%

> 20%<= 30%

> 30%<= 40%

> 40%

% o

f C

om

pan

ies

TTM EBITDA Margin




37

0%

5%

10%

15%

20%

25%

30%

1Q14 2Q14 3Q14 4Q14 1Q15

% o

f R

ev

en

ue


-10%

0%

10%

20%

30%

40%

50%

60%

70%

1Q14 2Q14 3Q14 4Q14 1Q15

% M

arg

in


• OpEx: Median spending on operations by public Internet companies in 1Q15 was consistent with historic norms: 12.2% for Research & Development, 25.3% for Sales & Marketing, and 11.4% for General & Administrative.

• Over the past year, S&M, R&D and G&A expenses as a percent of revenue have remained relatively flat.

• The median R&D spend as a percent of total revenue was the lowest among our three tracking indices.

• Despite revenue growth declining modestly YoY, public internet companies have kept their cost structures in line, resulting in a median EBITDA margin of 8.2% in 1Q15, roughly on par with 1Q14’s 8.7% metric.


THE SEG INTERNET INDEX: PUBLIC MARKET MULTIPLES

• The median public market EV/Revenue multiple of public Internet providers closed 1Q15 at 1.8x, the lowest since 3Q12’s 1.9x metric. 54% of companies comprising our Internet Index closed Q1 with an EV/Revenue multiple of 2.0x or less.

• Considering approximately 56% 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 pressure on wages and declining profitability caused by increased competition and downward pressure on prices.

• Conversely, 13% 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 1Q15 were those that have captured a significant share of online advertising and commerce dollars. Examples include Facebook (16.4x); Twitter (19.8x); Zillow (12.1x); LinkedIn (13.5x); and GrubHub (11.5x).

Median EV/Revenue Multiple Distribution – 1Q15 Median EV/Revenue and EV/EBITDA Multiples – Quarterly

38

2.1x 2.0x 1.9x 1.8x 1.8x

17.4x 19.1x 18.6x

20.3x

16.7x

1Q14 2Q14 3Q14 4Q14 1Q15

Me

dia

n M

ult

iple


29%

25%

15%

8%

4% 5%

2% 3% 1%

9%

<= 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

% o

f C

om

pa

nie

s

EV/Revenue


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 (4.5x) in Q1 than their slower growing peers. Among those outperformers were: GrubHub (85.1%, 11.5x EV/Revenue); Twitter (111%, 19.6x EV/Revenue); Yelp (62.1%, 8.4x EV/Revenue); LinkedIn (45.1%, 13.5x 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 1Q15, 278% 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 4.8x in Q1, 18% 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 (49.9% EBITDA margin, 58.4% revenue growth); Baidu.com (34.2% EBITDA margin, 53.5% revenue growth); Yandex (39% EBITDA margin, 28.5% revenue growth); and Tencent Holdings (39% EBITDA margin, 30.6% revenue growth).


39

1.0x

1.5x 1.8x

2.2x

3.5x

4.5x

<= 0% > 0%<= 10%

> 10%<= 20%

> 20%<= 30%

> 30%<= 40%

> 40%

Me

dia

n E

V/

Re

ve

nu

e

TTM Revenue Growth

1.4x 1.3x 1.8x

3.8x

5.2x

6.8x

<= 0% > 0%<= 10%

> 10%<= 20%

> 20%<= 30%

> 30%<= 40%

> 40%

Me

dia

n E

V/

Re

ve

nu

e

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

40

Search


THE SEG INTERNET INDEX BY PRODUCT CATEGORY: FINANCIAL PERFORMANCE

1Q15 Median YoY Change in Revenue Growth 1Q15 Median TTM Revenue Growth

1Q15 Median YoY Change in EBITDA Margin 1Q15 Median TTM EBITDA Margin

41

21.0%

17.8%

12.1%

22.7%

5.3%

23.7%

28.2%

58.4%

22.5%

Ad Tech

Commerce

Content & Media

Gaming

Infrastructure

Search

Services

Social

Travel

(32.7%)

9.2%

25.4%

103.3% (49.6%)

(18.2%)

(43.2%)

2.0%

7.4%

Ad Tech

Commerce

Content & Media

Gaming

Infrastructure

Search

Services

Social

Travel

3.3%

7.8%

12.2%

13.1%

6.0%

33.4%

6.5%

10.5%

13.8%

Ad Tech

Commerce

Content & Media

Gaming

Infrastructure

Search

Services

Social

Travel

(18.0%)

(27.1%)

(14.9%)

(51.7%)

(0.3%)

(11.7%)

(15.9%)

(4.0%)

(18.4%)

Ad Tech

Commerce

Content & Media

Gaming

Infrastructure

Search

Services

Social

Travel


THE SEG INTERNET INDEX BY PRODUCT CATEGORY: PUBLIC MARKET MULTIPLES

• Public Internet companies comprising the Social product category closed Q1 with a median revenue growth rate of 58.4%, roughly 3x the overall Internet median growth rate of 19.5%. The Services product category ended Q1 with a median revenue growth rate of 28.2%, roughly 50% greater than Q1’s Internet median.

• Public Internet companies comprising the Social category closed 1Q15 with the highest median EV/Revenue multiple, 8.4x, led by Twitter (19.8x) and Facebook (16.4x).

• 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 32.7% YoY in 1Q15.

• Companies within the Search product category continued to be very profitable in Q1, posting a median EBITDA margin of 33.4%, 4x higher than the median EBITDA margin across all Internet categories in 1Q15.

• Following a correction in public software industry valuations witnessed throughout 2014, all nine of our product categories experienced a decline in YOY EV/Rev valuation.

Median 1Q15 YoY Change in EV/Revenue 1Q15 Median EV/Revenue Multiples

42

1.2x

1.1x

1.7x

2.0x

1.3x

1.6x

2.5x

8.4x

2.7x

Ad Tech

Commerce

Content & Media

Gaming

Infrastructure

Search

Services

Social

Travel

(27.9%)

(7.3%)

(36.1%)

(22.4%)

(33.4%)

(14.0%)

(37.3%)

(42.3%)

(4.7%)

Ad Tech

Commerce

Content & Media

Gaming

Infrastructure

Search

Services

Social

Travel


SOFTWARE INDUSTRY M&A MARKET UPDATE


Average On-Premise Software Deal Size U.S. Software Mergers & Acquisitions Activity

• There were 451 reported software M&A transactions in 1Q15. The first quarter tally will likely increase by approximately 15 – 20 transactions as unpublicized deals are added.

• Software M&A spending in 1Q15 totaled $17.1 billion, modestly lower than Q4 2014’s $18 billion aggregate price tag. While Q1 featured eleven mega deals (EV>500M), there were few blockbusters, and only one exceeded $2 billion - SS&C Technologies’ $2.6 billion acquisition of financial services software provider, Advent Software. Comparatively, 3Q14’s $43.5 billion M&A spend included six transactions with an enterprise value north of $2 billion, led by SAP’s $7.7 billion acquisition of Concur .

• Other 1Q15 mega deals during included DH Corporation’s acquisition of Fundtech ($1.3B EV, 4.8x EV/Revenue multiple); Lexmark International Technology’s acquisition of Kofax ($1.0B, 3.2x); and Harman International Industries’ acquisition of Symphony Teleca ($780 million, 2.1x).

• Megadeals aside, most buyers continued to focus on small and mid-sized acquisitions in 1Q15, consistent with their response to our 2015 Buyers Survey, in which 95% of respondents indicated they would focus in 2015 on deals in the range of $10M - $99M .

1Q15 SOFTWARE / SAAS M&A DEAL VOLUME AND SPENDING

44

432 454

435 406 394

431 444 455 460

517

488 493

451

$15.8

$23.1

$12.3

$15.8

$9.9

$20.8 $20.2 $22.8

$31.4

$26.6

$43.5

$18.0 $17.1

$0

$5

$10

$15

$20

$25

$30

$35

$40

$45

$50

0

100

200

300

400

500

600

1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14 4Q14 1Q15

Valu

e (BIllio

ns) N

um

ber

of

Dea

ls

Deals Value

$41 $42

$36 $39

$36 $35

$40 $43

$53 $54

$65 $61

$54

$0.0

$10.0

$20.0

$30.0

$40.0

$50.0

$60.0

$70.0

1Q

12

2Q

12

3Q

12

4Q

12

1Q

13

2Q

13

3Q

13

4Q

13

1Q

14

2Q

14

3Q

14

4Q

14

1Q

15

TT

M A

ver

age

Dea

l Val

ue

(Mil

lio

ns)


• The median exit multiple for on-premise software sellers advanced to 2.5x in 1Q15 after reaching or exceeding a median 2.3x EV/Rev in each of the past four quarters.

• Historically, a median 2.4x EV/Revenue exit multiple is at the higher end of the valuation range for on-premise software companies. 1Q15 is the first quarter since 2Q11 that has seen a median exit multiple above 2.4x.

SOFTWARE M&A EXIT MULTIPLES

• On a TTM basis, 34.5% of all on-premise software targets in 1Q15 were acquired for 2.0x TTM revenue or less, and 63.7% for 3.0x or less.

• Most targets receiving an exit multiple of 3.0x or higher belonged to currently “hot” software product categories that are experiencing rapid market adoption and growth, including Financial Services, BI, Risk & Compliance, and Mobile.

• Noteworthy smaller on-premise acquisitions in 1Q15 included Aveva Group acquisition of lifecycle contract management software provider 8over8 ($40.9 million, 2.7x TTM revenue); and Attunity’ acquisition of big data management software provider Appfluent Technology ($17.6 million, 3.0x TTM revenue).

Median EV/Revenue Exit Multiple Distribution Median Exit Multiples

45

13.3%

21.2%

29.2%

10.6% 9.7%

2.7%

13.3%

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

% o

f D

ea

ls -

1Q

15

TT

M

2.3x 2.3x 2.4x 2.3x 2.5x

13.3x

18.1x 17.7x 16.2x

17.5x

0.0x

2.0x

4.0x

6.0x

8.0x

10.0x

12.0x

14.0x

16.0x

18.0x

20.0x

1Q14 2Q14 3Q14 4Q14 1Q15



Large Vs. Smaller Buyer Public vs. Private Target

SOFTWARE M&A: BY OWNERSHIP STRUCTURE AND SIZE

• Of the deals announced in 1Q15 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 first quarter was only marginally higher for private on-premise software sellers (2.4x TTM revenue) than for their public counterparts (2.2x TTM revenue).

• Public buyers in 1Q15 paid a median 2.3x TTM revenue for their targets in 1Q15, compared to a median of 2.5x 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 1.9x TTM revenue paid by sub-$200 million revenue 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 Q1, this match-up produced a median 3.2x EV/Revenue exit multiple.

46


SOFTWARE M&A: BY VERTICAL AND HORIZONTAL MARKETS

Horizontal & Vertical M&A Median EV/Revenue Exit Multiples Horizontal & Vertical M&A Volume

• The median exit valuation of horizontal software companies was 2.3x TTM revenue in 1Q15, virtually unchanged from the prior four quarters. Notable Q1 horizontal transactions included Stamps.com’s acquisition of postage and shipping software provider PSI Systems for $215 million (3.6x EV/Revenue), and Lexmark International Technology’s acquisition of business process management software provider Kofax for $1.0 billion (3.2x EV/Revenue).

• The median exit valuation of vertical software companies was 2.4x TTM revenue in 1Q15, on par with the prior quarter. While the number of vertical software acquisitions in Q1 was below the historical norm, vertical software targets have garnered a higher median EV/Revenue exit multiple than their horizontal software counterparts for the past three quarters.

• Q1’s more noteworthy vertical software deals included Mitel’s acquisition of telecommunications networking software provider Mavenir Systems for $547 million (3.8x EV/Revenue); SS&C Technologies Holdings’ acquisition of financial services software provider Advent Software for $2.6 billion (6.4x EV/Revenue); and DH Corporation’s acquisition financial services software provider Fundtech for $1.3 billion (4.8x EV/Revenue).

47

35% 35% 31% 34% 33%

65% 65% 69% 66% 67%

0%10%20%30%40%50%60%70%80%90%

100%

1Q14 2Q14 3Q14 4Q14 1Q15

Horizontal Vertical

2.1x 2.1x

2.5x

2.4x 2.4x

2.5x

2.4x 2.4x

2.3x 2.3x

1Q14 2Q14 3Q14 4Q14 1Q15

Vertical Horizontal


SOFTWARE M&A ACTIVITY BY PRODUCT CATEGORY

• Mobile was the most active product category by far in the first quarter, accounting for 27.4% of all software M&A transactions. Distant runner-ups were Financial Services (7.6%), Security (4.6%), Messaging, Conferencing, & Communications (4.6%), and BI, Risk & Compliance (4.3%).

• Historically, deal activity in any given product category varies widely from year to year, based upon evolving market adoption, changing technology platforms, economic cycles, etc. Examples include:

• Messaging, Conferencing, & Communications transactions accounted for 4.6% of all software M&A activity in 1Q15, but only 1.5% in 1Q14.

• CRM, Marketing & Sales deals represented only 0.8% of all software M&A activity in 1Q15, compared with 4.3% in 1Q14.

• Healthcare transactions were credited with 4.3% of software M&A activity in 1Q15, compared with 7.1% in 1Q14.

• Real Estate accounted for 3.6% of all software M&A activity in 1Q15, compared with 1.2% in 1Q14.

48


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, eleven had both sufficient deal activity and deal data to ascertain a category TTM revenue multiple in 1Q15.

• On a TTM basis, the Financial Services category was rewarded with the highest median exit multiple (4.5x) in Q1, followed by Healthcare with a median exit multiple of 2.7x.

• 1Q15’s most notable Financial Services software transactions included DH Corporation’s acquisition financial services software provider Fundtech for $1.3 billion (4.8x EV/Revenue), and First Derivatives’ acquisition of ActivateClients (6.5x EV/Revenue).

• First quarter Healthcare software transactions included Sy.Med Development’s acquisition of HealthLine Systems (4.7x EV/Revenue).

• On-premise CRM & Marketing exit multiples lagged far behind most others, with most M&A dollars in this product category going to SaaS/hosted solution providers.

49

4.5x

2.7x 2.5x 2.5x 2.4x 2.1x 2.0x 1.9x 1.7x 1.6x

1.1x

Fin

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Median SaaS EV/Revenue Exit Multiples SaaS M&A Volume

• There were 134 SaaS M&A transactions in 1Q15, the most on record for any quarter, and approximately 106% greater than three years ago.

• The median TTM EV/Revenue exit multiple of SaaS transactions was 3.4x in 1Q15, slightly below the prior quarter. The median SaaS exit multiple has declined in three of the past four quarters as the number of SaaS targets has substantially increased. Much of the reason for the recent EV/Revenue decline can be attributed to active private equity (ie. Insight Venture’s acquisition of E2Open – 3.2x TTM revenue and GTCR’s acquisition of Vocus – 2.4x TTM revenue) and non-traditional buyers in SaaS, such as digital and audio equipment manufacturer, Harman International, and business process services provider Maximus. Both buyer groups tend to pay less than larger software and SaaS buyers.

• That said, several SaaS sellers in Q1 fetched exit multiples well above the median, including Panaya, purchased by Infosys for $200 million, 6.0x revenue; and Akcelerant Software, acquired by Temenos U.S.A. for $55 million, a 5.0x TTM revenue multiple.

• The median SaaS exit multiple was 36% greater than the median on-premise software exit multiple in 1Q15 (3.4x vs 2.5x).

SaaS M&A: DEAL VOLUME AND MEDIAN EXIT MULTIPLES

50

4.6x

4.0x 4.1x 3.7x

3.4x

1Q14 2Q14 3Q14 4Q14 1Q15

65 59

94 94 86

104 97

103 104 108

118

132 134

0%

5%

10%

15%

20%

25%

30%

0

20

40

60

80

100

120

140

160

1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14 4Q14 1Q15

Sa

aS

M&

A D

ea

ls a

s a

% o

f T

ota

l S

oft

wa

re

M&

A D

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ls

# o

f S

aa

S M

&A

De

als

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 9.7% and 9.0%, respectively, of all SaaS M&A transactions in the first quarter.

• Historically, these two product categories have each accounted for double digit percentages of quarterly SaaS deal volume. However, we would expect these solutions to make-up a smaller portion of total acquisition volume as the delivery model continues to penetrate most verticals and product categories.

• Messaging, Conferencing, & Communications and BI, Risk & Compliance product categories also exhibited strength in 1Q15, accounting for 6.0% and 8.2%, respectively, of total SaaS deal volume for the quarter.

• Other notable categories included Supply Chain Management & Logistics (5.2%), Content & Document Mgmt. (4.5%), Security (3.7%), and Multimedia, Graphics & Communications (3.7%).

SaaS M&A BY PRODUCT CATEGORY – 1Q15

51


1Q15 SaaS M&A TRANSACTIONS

52

Date Buyer Seller Enterprise Value

(mm) TTM Revenue

(mm) EV/Rev

03/31/15 Mozido, LLC SimplyTapp, Inc. - - -

03/31/15 CipherCloud, Inc. Anicut Systems, Inc. - - -

03/30/15 Selectica, Inc. (NasdaqCM:SLTC) b-pack SAS* $13.0 $4.5 2.9x

03/30/15 W2O Group VinTank LLC - - -

03/26/15 Microsoft Corporation (NasdaqGS:MSFT) LiveLoop, Inc. - - -

03/26/15 IHS Inc. (NYSE:IHS) Dataium LLC - - -

03/25/15 Quorum Business Solutions, Inc. Fielding Systems LLC - - -

03/24/15 Dude Solutions Inc. Windmill Software Inc. - - -

03/24/15 Intuit Inc. (NasdaqGS:INTU) Playbook Labs, Inc. - - -

03/23/15 Accusoft Corporation edocr Limited - - -

03/20/15 Gravity4, Inc. Triggit, Inc. - - -

03/20/15 Armat Group S.A. Harness Handitouch Pvt. Ltd. - - -

03/20/15 Gary Jonas Computing Ltd. Outbound Software LLC - - -

03/19/15 Benetech Inc. Integrated Global Resource Solutions, LLC - - -

03/19/15 Avtex Solutions, LLC Digital Voice Systems, Inc. - - -

03/18/15 PlanSource Benefits Administration, Inc. ClearBenefits, Inc. - - -

03/17/15 FocusVision Worldwide, Inc. Insight Marketing Systems Pty Ltd. - - -

03/17/15 Cloudability Inc. Digital Mines Limited - - -

03/16/15 LocalVox Media, Inc. MarketMeSuite, LTD. - - -

03/16/15 LinkedIn Corporation (NYSE:LNKD) Careerify Corp. - - -

03/16/15 Magnolia Resources Limited (ASX:MGB) PDT Technologies Inc. - - -

03/16/15 Patreon, Inc. Subbable, LLC - - -

03/16/15 The Rainmaker Group Ventures, LLC. Revcaster LLC - - -

03/12/15 Procura, LLC Indura Systems, Inc. - - -

03/12/15 - Thinking Phone Networks, Inc. - - -

03/11/15 Kennet Partners Limited TreeHouse Interactive, Inc. - - -

03/10/15 Elastic Found by Elastic - - -

03/10/15 The Pursuant Group, Inc. 2DIALOG, Ltd. - - -

03/09/15 Ceridian Corporation RelatedMatters, Inc. - - -

03/09/15 iPhotonix, LLC NetSocket, Inc., Network Functions Virtualization Assets - - -

03/09/15 Maximus Federal Services, Inc. Acentia, LLC $300.7 $214.81 1.4x

03/09/15 ITL Group Overheer Systems Ltd. - - -

03/04/15 Nielsen N.V. (NYSE:NLSN) eXelate, Inc. - - -

03/04/15 The IBM Watson Group AlchemyAPI, Inc. - - -

03/04/15 MC2 Consulting Services, Inc. TimeSimplicity LLC - - -

03/04/15 Integral Ad Science, Inc. Veenome Inc. - - -

03/03/15 Broadridge Financial Solutions, Inc. (NYSE:BR) Direxxis, Inc. - - -

03/03/15 Uber Technologies, Inc. deCarta, Inc. - - -

03/03/15 iModules Software, Inc. OrgSync, Inc. - - -

03/03/15 Auction.com, LLC Channel, LLC - - -

03/03/15 Siemens Logistics & Airport Solutions AxIT AG - - -

03/03/15 Platts, Inc. Minerals Value Services GmbH - - -

03/02/15 ImpressTV Limited Gravity R&D, Ltd., Recommender System Business Line - - -

03/02/15 Pageflex Inc. EarthIntegrate - - -

03/02/15 QuickPlay Media Inc. Roundbox, Inc. - - -


1Q15 SaaS M&A TRANSACTIONS (CON’T)

53


(mm) TTM Revenue

(mm) EV/Rev

03/02/15 Amber Road, Inc. (NYSE:AMBR) Amber Road (International) Inc. $31.6 - -

03/02/15 PCTEL RF Solutions Inc. Nexgen Wireless, Inc. $22.5 - -

03/01/15 KeyMark, Inc. IMR, Limited - - -

02/27/15 Wheatsheaf Investments Ltd FarmWizard Ltd. - - -

02/26/15 TechnoCom Corporation Locaid, Inc. - - -

02/26/15 The CHR Group, Inc. AirPR, Inc., PR Marketplace - - -

02/26/15 ePressPack SAS PressKing SAS - - -

02/26/15 Sprinklr Inc. Pluck Corporation - - -

02/26/15 DealerSocket, Inc. Finance Express, LLC - - -

02/26/15 Lux Research, Inc. Zik Energy Points, Inc. - - -

02/24/15 Fleetmatics Group PLC (NYSE:FLTX) Ornicar SAS - - -

02/23/15 Educa Network S.L.N.E. Plusformación - - -

02/23/15 Internet Brands, Inc. Total Attorneys, L.L.C. - - -

02/22/15 Hobsons Australia Pty Limited Starfish Retention Solutions, Inc. - - -

02/20/15 Box, Inc. (NYSE:BOX) Airpost, Inc. - - -

02/19/15 CampaignerCRM PrecisionPort, Inc. - - -

02/19/15 PeopleAdmin, Inc. Netchemia, LLC - - -

02/19/15 Renaissance Learning Inc. UClass, Inc. - - -

02/18/15 CohereOne, Inc. Melasa Group LLC - - -

02/18/15 - Vidmind Ltd $2.4 - -

02/17/15 Journal Newspapers (The) LDSJournal, LTD. - - -

02/16/15 Infosys Ltd. (BSE:500209) Panaya Ltd.* $200.0 $33.33 6.0x

02/13/15 British Gas Services Limited AlertMe.com Ltd. $85.7 - -

02/12/15 InsightPool LLC NextPrinciples, Inc. - - -

02/12/15 Pervasip Corp. (OTCPK:PVSP) Canalytix LLC - - -

02/11/15 Datadog, Inc. Mortar Data Inc. - - -

02/11/15 Alma Always Prepped Inc. - - -

02/11/15 j2 Global, Inc. (NasdaqGS:JCOM) Firstway Digital Limited - - -

02/11/15 TOTVS S.A. (BOVESPA:TOTS3) Neolog Consultoria E Sistemas S.A. $9.0 $3.17 2.9x

02/11/15 Buildium, LLC All Property Management, LLC - - -

02/10/15 Go Daddy Software, Inc. Nodejitsu Inc. - - -

02/10/15 Temenos U.S.A., Inc. Akcelerant Software LLC $55.0 $11.0 5.0x

02/10/15 Vector Capital Saba Software, Inc. $270.2 - -

02/10/15 Coupa Software Incorporated ZenPurchase, Inc. - - -

02/10/15 CVC Capital Partners Limited Wireless Logic Limited - - -

02/09/15 Aysling Digital Media Solutions Juggernaut LLC - - -

02/09/15 Enprise Group Limited (NZSE:ENS) GlobalBizPro Limited, MYOB EXO Practice Division $0.6 - -

02/09/15 LINE Pay Corporation WebPay Holdings - - -

02/06/15 Battery Ventures Enviance, Inc. - - -

02/06/15 Groupe T2i Notys Solutions SARL - - -

02/05/15 Patriot National, Inc. (NYSE:PN) Decision UR, LLC $2.2 - -

02/05/15 Intuit Inc. (NasdaqGS:INTU) Porticor Ltd. $10.0 - -

02/05/15 Insight Venture Partners E2open, Inc. $249.9 $78.59 3.2x

02/04/15 Blackboard Inc. Schoolwires, Inc. - - -

02/04/15 Synchronoss Technologies, Inc. (NasdaqGS:SNCR) F-Secure Oyj, Personal Cloud Assets $60.0 - -


1Q15 SaaS M&A TRANSACTIONS (CON’T)

54


(mm) TTM Revenue

(mm) EV/Rev

02/04/15 Puget Technologies,Inc (OTCPK:PUGE) Leisure Logic Technology Systems, Inc. $0.4 - -

02/03/15 Cloudera, Inc. Xplain.io - - -

02/02/15 FF&P Private Equity Limited Kallidus Limited - - -

01/29/15 3TL Technologies Corp. (TSXV:TTM) RewardStream, Inc. $4.8 $1.47 3.2x

01/29/15 AccuWeather Enterprise Solutions, Inc. Hazard Notifications LLC - - -

01/29/15 Yandex N.V. (NasdaqGS:YNDX) OOO RosInfoTeh - - -

01/28/15 Engineering Ingegneria Informatica S.p.A. (BIT:ENG) WebResults S.r.l. - - -

01/28/15 Slack Technologies, Inc. Screenhero, Inc - - -

01/27/15 EPiServer AB Ektron, Inc. - - -

01/26/15 Apex Peak Pte. Ltd. Cashnomix - - -

01/26/15 TradeDoubler AB (OM:TRAD) adnologies GmbH - - -

01/26/15 CREALOGIX Holding AG (SWX:CLXN) MBA Systems Ltd. - - -

01/26/15 DABERO Service Group GmbH icubic AG - - -

01/26/15 Dropbox Inc. Moji, Inc. - - -

01/23/15 Microsoft Corporation (NasdaqGS:MSFT) Revolution Analytics, Inc. - - -

01/23/15 Roper Industries, Inc. (NYSE:ROP) Strata Decision Technology, L.L.C. - - -

01/22/15 Harman International Industries (NYSE:HAR) Symphony Teleca Corp. $780.0 $369.67 2.1x

01/21/15 Intuit Inc. (NasdaqGS:INTU) Zeropaper Serviços de Informática S.A. - - -

01/21/15 Orion Edutech Private Limited Brainvalley Software Private Limited - - -

01/21/15 ServiceRocket Inc Matygo Educational Inc. - - -

01/21/15 Apple Europe Limited Semetric Limited - - -

01/20/15 Datapipe, Inc. GoGrid, LLC - - -

01/16/15 The Mobile Majority Elastic - - -

01/15/15 Alliance Creative Group, Inc. (OTCPK:ACGX) PeopleVine - - -

01/15/15 MailerMailer LLC Domainate, Inc., Listcast - - -

01/14/15 Ecart Invest Minox Software B.V. - - -

01/14/15 iMedia International Inc. KloudSign LLC - - -

01/14/15 Synacor, Inc. (NasdaqGM:SYNC) NimbleTV, Inc. - - -

01/14/15 RHEA System S.A. SixSq Sarl - - -

01/13/15 Gravity4, Inc. Zurmo Inc. - - -

01/13/15 KPMG Oy Ab Trusteq Oy - - -

01/13/15 Paragon Software Systems plc Axida Limited - - -

01/13/15 Contractors Register, Inc. BuildingBlok LLC - - -

01/12/15 OMNICOM Media Group Germany GmbH Trakken Web Services GmbH - - -

01/12/15 DG3 LLC Digital Publishing Solutions, Inc. - - -

01/12/15 Argus Media, Inc. Metalprices.com, Inc. - - -

01/12/15 Demandware, Inc. (NYSE:DWRE) Tomax Corporation $75.0 $20.0 3.8x

01/08/15 Dun & Bradstreet Corp. (NYSE:DNB) Dun & Bradstreet NetProspex $125.0 - -

01/08/15 Huron Legal (UK) Limited Sky Analytics, Inc. - - -

01/08/15 Surna Inc. (OTCPK:SRNA) Agrisoft Development Group, LLC $5.0 - -

01/07/15 Silver Spring Networks, Inc. (NYSE:SSNI) Detectent, Inc. $12.0 - -

01/06/15 Talentpeople SARL SELEXENS Marseille - - -

01/06/15 Everbridge, Inc. Nixle, LLC. - - -

01/05/15 Snipp Interactive Inc. (TSXV:SPN) Swiss Post Solutions Ireland Limited - - -


Internet M&A Volume

INTERNET M&A: DEAL VOLUME AND EXIT MULTIPLES

Median Internet EV/Revenue Exit Multiples

• After growing steadily throughout 2014, Internet M&A deal volume in 1Q15 was unchanged from the prior quarter.

• Q1’s 244 Internet M&A transactions represented a 25% YoY gain (195 in 1Q14 vs 244 in 1Q15).

• The median EV/Revenue exit multiple for Internet sellers in surged to 2.9x in the first quarter, a eye-popping gain over the median exit multiple that has prevailed for the past four quarters.

• Leading Internet M&A transactions in 1Q15 included Zayo Group’s acquisition of Latisys Holdings ($675 million, 6.8x EV/Revenue estimate); Songcheng Performance Development’s acquisition of Beijing Six Rooms ($417 million, 5.8x EV/Revenue); and Rakuten’s acquisition of OverDrive ($410 million, 4.1x EV/Revenue estimate).

55

1.8x 1.7x 2.1x 2.0x

2.9x

1Q14 2Q14 3Q14 4Q14 1Q15

195 215

241 244 244

1Q14 2Q14 3Q14 4Q14 1Q15


INTERNET M&A: BY PRODUCT CATEGORY

1Q15 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 1Q15. The first quarter’s tally was up from 4Q14’s 67 ad-tech transactions and on par with 3Q14’s 73 transactions.

• For the third consecutive quarter, Infrastructure posted 32 transactions during the quarter. Meanwhile, quarterly M&A deal volume in the Commerce category fell from 65 transactions in 4Q14 to 50 in 1Q15, but remained above the first three quarters of last year.

• Content and Media’s 60 transactions posted the second highest category tally in 1Q15. Volume in this segment has been growing each of the past three quarters.

• Gaming once again held the lowest transaction volume. It’s ten transactions posted the second consecutive quarterly drop and equaled 1Q14’s mark.

56

29.9%

20.5% 24.6%

4.1%

13.1%

7.8%

Ad-Tech & Lead Gen

Commerce

Content & Media

Gaming

Infrastructure

Social Tech

Category 1Q 2014 2Q 2014 3Q 2014 4Q 2014 1Q15

Ad-Tech & Lead Gen 57 68 73 67 73

Commerce 38 41 49 65 50

Content & Media 50 41 43 52 60

Gaming 10 16 21 13 10

Infrastructure 21 25 32 32 32

Social Tech 18 24 23 15 19

Total 194 215 241 244 244


APPENDIX


THE SEG SOFTWARE INDEX COMPANIES – KEY METRICS

58

Company


A10 Networks - 4.0x 3.2x 0.8x 1.0x - - - - - 18.1% - - 31.8% 26.6% -3.0% -1.0% -1.7% -7.5% -12.8%

Accretive Health 0.4x 0.3x 0.4x 0.4x 0.5x 5.6x 4.7x 5.6x 6.2x 7.2x -0.2% -2.1% -3.1% 0.5% 0.5% 6.6% 6.7% 6.6% 6.3% 6.3%

ACI Worldwide 3.4x 3.1x 2.9x 3.0x 3.1x 15.0x 14.6x 13.5x 14.5x 15.1x 29.8% 33.8% 30.3% 25.2% 17.5% 22.6% 21.0% 21.6% 20.9% 20.5%

Activision Blizzard 3.0x 3.4x 3.8x 3.4x 3.6x 9.4x 11.5x 14.1x 13.5x 12.5x -5.6% -12.7% -13.9% -10.0% -3.8% 32.3% 29.5% 27.2% 25.4% 28.9%

Advent Software 4.9x 4.6x 4.9x 4.7x 6.3x 26.2x 24.5x 20.2x 18.6x 24.2x 6.7% 6.3% 5.6% 4.3% 3.6% 18.6% 18.6% 24.1% 25.3% 25.9%

Allot Communications 4.2x 3.1x 2.4x 1.8x 1.5x - 554.0x 69.1x 33.5x 55.7x -7.8% -3.8% 8.3% 19.0% 21.4% -0.8% 0.6% 3.4% 5.4% 2.7%

Allscripts Healthcare Solutions 2.5x 2.4x 2.3x 2.1x 2.0x 268.0x 198.7x 98.5x 58.1x 48.2x -5.1% -4.4% -2.2% 1.1% 0.4% 0.9% 1.2% 2.4% 3.5% 4.1%

Amdocs Limited 1.7x 1.9x 1.8x 1.7x 1.8x 9.3x 10.1x 9.9x 9.4x 9.7x 3.6% 4.8% 5.6% 6.5% 6.6% 18.5% 18.4% 18.3% 18.5% 18.9%

American Software 2.1x 2.0x 1.9x 2.0x 2.0x 12.8x 12.5x 11.9x 16.3x 17.9x -3.2% 0.1% 4.4% 1.3% 1.3% 16.6% 16.2% 15.9% 12.3% 11.1%

ANSYS 8.0x 6.9x 7.2x 7.1x 7.4x 17.1x 14.8x 15.5x 15.2x 16.1x 7.9% 8.4% 8.0% 8.5% 8.7% 46.8% 46.8% 46.5% 46.6% 46.0%

Aruba Networks 2.9x 2.6x 2.5x 2.4x 2.1x 189.8x 118.2x 57.2x 33.8x 20.6x 11.6% 15.8% 21.5% 25.8% 27.4% 1.5% 2.2% 4.4% 7.0% 9.9%

Aspen Technology 11.3x 10.1x 9.4x 7.4x 7.3x 41.1x 34.0x 27.8x 19.9x 18.7x 27.3% 27.7% 25.7% 25.5% 20.4% 27.5% 29.7% 34.0% 37.2% 38.9%

Autodesk 4.5x 4.3x 4.7x 5.0x 4.9x 24.2x 25.1x 30.9x 39.4x 45.3x -1.7% 0.1% 3.7% 6.1% 10.5% 18.8% 17.1% 15.3% 12.8% 10.7%

AVG Technologies 2.3x 2.6x 2.3x 2.5x 2.7x 6.5x 7.3x 6.8x 7.1x 8.5x 14.4% 4.8% -3.0% -6.1% -8.1% 35.0% 35.0% 33.6% 35.6% 32.4%

Bango PLC 7.5x 6.3x 6.0x 9.6x 9.0x - - - - - -13.7% -16.5% -19.5% 0.0% -42.0% -51.5% -60.4% -71.1% -81.2% -95.7%

Barracuda Networks 7.1x 5.4x 5.0x 6.2x 6.5x - 347.7x 158.5x 181.4x 227.3x 17.5% 16.5% 16.8% 17.6% 18.7% -0.1% 1.5% 3.2% 3.4% 2.8%

Blackbaud 3.2x 3.2x 3.4x 3.7x 4.0x 16.3x 16.2x 17.5x 20.5x 24.5x 12.6% 10.1% 9.5% 11.8% 12.0% 19.9% 19.7% 19.6% 18.3% 16.5%

Bottomline Technologies 4.6x 3.7x 3.3x 2.9x 3.0x 44.1x 33.5x 29.7x 25.6x 24.1x 11.6% 13.1% 18.0% 20.9% 19.8% 10.3% 11.1% 11.1% 11.5% 12.6%

Broadridge Financial 1.9x 2.0x 2.0x 2.2x 2.5x 9.9x 10.0x 10.0x 10.8x 12.4x 7.3% 7.2% 5.2% 3.6% 4.6% 19.1% 19.6% 20.4% 19.9% 19.9%

Brocade Communications Systems 1.7x 1.6x 1.6x 1.9x 2.1x 7.1x 6.1x 6.1x 7.3x 8.0x -3.0% -2.8% -1.6% -0.5% 1.1% 24.4% 25.5% 26.2% 25.8% 25.6%

BSQUARE 0.2x 0.2x 0.2x 0.2x 0.3x - - 74.9x 9.9x 8.8x -9.2% -2.8% 1.2% 4.4% 4.1% -2.0% -1.3% 0.3% 2.4% 3.3%

CA 3.0x 2.6x 2.5x 2.7x 2.9x 9.0x 8.1x 7.9x 8.6x 9.3x -5.0% -2.1% -1.6% -1.1% -0.4% 33.9% 32.0% 31.7% 31.3% 31.1%

CA Technologies 3.0x 2.6x 2.5x 2.7x 2.9x 9.0x 8.1x 7.9x 8.6x 9.3x -5.0% -2.1% -1.6% -1.1% -0.4% 33.9% 32.0% 31.7% 31.3% 31.1%

Cadence Design Systems 2.7x 2.9x 3.1x 3.3x 3.2x 12.9x 14.4x 15.7x 16.6x 15.3x 10.1% 8.8% 7.4% 7.4% 8.3% 21.0% 19.9% 19.9% 19.9% 20.9%

Cerner 6.6x 5.9x 5.8x 6.4x 6.8x 25.3x 22.4x 21.9x 24.3x 23.5x 8.8% 11.1% 15.2% 15.2% 16.6% 26.2% 26.3% 26.5% 26.5% 29.0%

Check Point Software Tech 8.3x 8.0x 8.2x 9.1x 9.4x 15.0x 14.6x 15.0x 16.7x 17.2x 3.8% 4.5% 5.3% 6.3% 7.3% 55.4% 55.1% 54.7% 54.5% 54.3%

Cisco Systems 1.8x 2.0x 2.1x 2.2x 2.3x 6.6x 7.5x 7.6x 8.0x 8.0x 1.3% -1.4% -3.0% -3.1% 0.4% 26.8% 26.6% 27.3% 27.5% 29.1%

Citrix Systems 3.5x 3.2x 3.9x 3.6x 3.3x 16.0x 14.1x 16.4x 16.1x 15.5x 12.8% 12.2% 9.4% 8.3% 7.7% 22.2% 22.7% 23.8% 22.3% 21.4%

ClickSoftware Technologies Ltd 2.4x 2.2x 1.9x 1.6x 1.8x - - - - 655.0x 3.1% 4.2% 9.1% 21.3% 22.3% -3.0% -4.5% -3.0% -0.3% 0.3%

CommVault Systems 4.9x 3.2x 3.2x 2.9x 2.7x 26.9x 17.5x 18.7x 20.1x 23.8x 20.4% 18.2% 16.5% 13.1% 8.1% 18.2% 18.2% 17.1% 14.4% 11.5%

Computer Programs and Sys 3.5x 3.3x 3.3x 3.1x 2.7x 13.0x 12.1x 11.9x 10.9x 10.5x 9.6% 8.0% 3.7% 6.2% 1.9% 26.7% 27.3% 27.9% 28.5% 26.0%

Constellation 4.3x 4.2x 4.2x 4.5x 5.2x 33.5x 30.9x 42.0x 45.0x 35.5x 35.9% 41.7% 40.8% 38.7% 37.9% 12.8% 13.5% 9.9% 10.1% 14.6%

CSG Systems International 1.4x 1.3x 1.3x 1.3x 1.4x 8.0x 7.8x 8.3x 8.0x 9.0x -1.2% 0.3% -0.2% 0.2% 0.5% 16.8% 16.2% 16.0% 15.8% 15.7%

Cyan 0.9x 1.3x 1.4x 1.1x 1.5x - - - - - 21.6% 1.2% -12.5% -27.5% -13.8% -29.9% -40.8% -49.9% -59.6% -49.3%

Cyberark Software - - - 11.4x 12.9x - - - 69.2x 62.8x 40.1% 0.0% 0.0% 0.0% 55.7% 14.4% 13.2% 12.6% 16.5% 20.6%

Cyren 3.0x 2.6x 2.3x 1.6x 2.3x - - - - - 34.9% 25.0% 15.2% 5.0% -1.0% -7.7% -10.6% -13.7% -16.8% -12.4%

Dassault Systèmes 4.4x 4.8x 5.5x 5.4x 6.0x 15.0x 17.4x 20.9x 20.2x 24.1x 1.9% 1.6% 2.3% 5.9% 11.0% 29.2% 27.4% 26.3% 26.9% 25.1%

SEG Software Index

EV/Revenue EV/EBITDA TTM Revenue Growth EBITDA Margin



59

Company


DST Systems 1.7x 1.6x 1.6x 1.5x 1.6x 10.7x 9.9x 9.9x 9.8x 10.1x 3.2% 2.1% 2.0% 2.3% 3.4% 16.0% 16.0% 15.8% 15.8% 15.5%

Electronic Arts 1.9x 2.5x 2.5x 2.7x 3.3x 31.9x 36.1x 26.6x 16.9x 13.4x -7.5% -5.8% 1.3% 9.5% 21.6% 6.0% 6.9% 9.5% 15.9% 24.9%

EMC 2.2x 2.3x 2.5x 2.4x 2.3x 9.1x 9.5x 10.8x 10.5x 9.4x 6.9% 5.9% 5.7% 6.7% 5.2% 24.2% 23.7% 23.1% 23.0% 23.9%

EPIQ Systems 1.8x 1.7x 1.8x 1.9x 2.0x 10.6x 10.9x 13.3x 15.2x 17.4x 27.2% 23.9% 21.7% 12.5% 1.2% 16.6% 15.1% 13.2% 12.6% 11.8%

Evertec 7.4x 7.2x 6.9x 6.6x 6.3x 19.7x 18.0x 16.5x 15.7x 15.1x 4.5% 3.1% 2.2% 1.5% 0.9% 37.5% 40.0% 41.7% 42.1% 41.9%

Evolving Systems 3.6x 3.3x 3.7x 3.7x 3.1x 15.3x 15.4x 14.9x 13.9x 10.2x -4.4% -7.4% 3.9% 12.9% 18.3% 23.8% 21.4% 24.6% 26.5% 30.4%

F5 Networks 5.0x 4.7x 4.8x 5.0x 4.3x 16.2x 15.4x 15.7x 16.3x 13.9x 7.2% 11.3% 14.7% 16.9% 17.5% 30.8% 30.7% 30.8% 30.7% 31.1%

Fair Isaac 3.1x 3.1x 3.1x 3.4x 3.9x 11.9x 11.9x 11.8x 13.7x 16.7x 6.0% 3.9% 2.5% 6.1% 7.6% 25.9% 26.4% 26.0% 25.2% 23.3%

FalconStor Software 0.9x 1.0x 0.8x 0.6x 1.0x - - - - - -22.2% -22.4% -23.5% -26.1% -21.1% -12.4% -10.7% -9.2% -11.3% -18.0%

Fidessa 3.1x 2.9x 2.8x 3.0x 3.0x 15.8x 15.3x 15.1x 16.4x 16.7x 0.1% 0.1% 0.1% -0.7% -1.4% 19.4% 19.1% 18.8% 18.5% 18.2%

Fiserv 3.8x 3.8x 3.9x 4.1x 4.4x 13.1x 13.0x 13.2x 13.8x 14.7x 8.5% 9.0% 7.6% 6.8% 5.2% 28.9% 29.1% 29.3% 29.7% 29.7%

Fortinet 5.0x 4.7x 5.2x 5.3x 6.2x 35.6x 35.9x 41.9x 45.3x 57.9x 15.3% 17.4% 20.0% 22.9% 25.2% 14.1% 13.1% 12.5% 11.6% 10.6%

GameLoft SA 2.5x 2.3x 1.6x 1.2x 1.1x 15.8x 16.8x 14.5x 14.2x 18.4x 12.0% 8.7% 5.7% 1.5% -2.6% 15.6% 13.4% 11.3% 8.5% 6.0%

Gigamon 6.0x 2.8x 1.5x 2.1x 2.9x - - - - - 45.1% 38.2% 15.4% 12.0% 17.8% -19.5% -25.8% -11.4% -9.3% -1.6%

Glu Mobile 3.3x 2.4x 3.1x 1.9x 2.0x - - - 77.6x 30.3x -2.4% 18.2% 40.0% 90.7% 111.3% -13.2% -6.0% -2.4% 2.5% 6.6%

Gree 1.5x 1.3x 1.2x 1.1x 0.9x 4.9x 3.9x 3.5x 3.2x 3.0x -12.7% -12.4% -17.5% -22.7% -25.0% 31.6% 34.2% 33.5% 33.6% 31.4%

GSE Systems 0.3x 0.3x 0.2x 0.2x 0.3x - - - - - -9.0% -14.3% -16.2% -22.7% -20.3% -6.8% -8.9% -10.4% -13.7% -12.3%

Guidance Software 2.6x 2.3x 1.9x 1.6x 1.5x - - - - - -14.6% -16.4% -14.1% -8.8% -1.7% -12.3% -10.9% -9.2% -6.7% -5.3%

Guidewire Software 9.0x 6.7x 7.3x 8.3x 8.4x 131.3x 97.1x 107.0x 91.0x 97.4x 21.2% 21.2% 16.5% 19.6% 17.2% 6.8% 6.9% 6.8% 9.1% 8.7%

Hewlett Packard 0.6x 0.6x 0.7x 0.7x 0.7x 5.1x 5.5x 5.7x 5.7x 5.7x -5.6% -3.2% -0.8% -0.8% -1.7% 11.5% 11.5% 11.5% 11.8% 11.9%

IBM 2.3x 2.3x 2.3x 2.0x 2.1x 8.7x 8.6x 9.0x 8.0x 7.8x -4.4% -5.9% -3.3% -2.8% -5.7% 26.1% 26.8% 25.6% 25.2% 26.3%

iDream Sky Technologies - - 1.8x 1.6x 0.3x - - 8.9x 7.9x 29.7x 1172.4% 0.0% 0.0% 0.0% 299.1% 15.3% 20.8% 20.8% 20.8% 1.1%

Imperva 9.7x 3.4x 4.3x 6.6x 6.7x - - - - - 32.2% 26.4% 25.2% 22.5% 19.1% -16.5% -23.5% -28.7% -32.5% -32.3%

Informatica 3.9x 3.4x 2.9x 3.2x 3.8x 22.6x 18.9x 16.0x 17.3x 20.3x 16.8% 17.7% 16.6% 12.5% 10.5% 17.3% 17.9% 18.4% 18.7% 18.7%

Intuit 5.1x 4.6x 4.8x 5.4x 5.4x 16.3x 13.6x 14.6x 16.9x 17.7x 12.2% 15.1% 8.0% 7.7% 11.0% 31.4% 33.9% 33.0% 31.8% 30.6%

Jack Henry & Associates 4.1x 4.0x 4.0x 4.0x 4.3x 11.9x 11.8x 11.6x 11.6x 12.3x 9.8% 9.1% 7.1% 6.9% 6.5% 34.0% 34.1% 34.5% 34.5% 34.6%

Juniper Networks 2.4x 2.1x 1.9x 1.8x 2.0x 14.3x 12.4x 11.0x 10.1x 11.1x 7.0% 8.8% 8.7% 5.8% -0.9% 17.0% 17.0% 17.6% 18.0% 17.7%

King Digital Entertainment - 2.2x 1.5x 1.7x 1.6x - 6.0x 4.1x 5.1x 4.9x 1046.1% 555.3% 213.8% 73.1% 20.4% 38.3% 35.8% 36.3% 32.9% 32.8%

Konami 1.5x 1.4x 1.4x 1.3x 1.4x 13.0x 17.3x 12.4x 10.9x 11.2x -4.1% -3.7% -0.8% 0.5% -1.9% 11.3% 8.3% 11.6% 12.2% 12.2%

Magic Software Enterprises 2.0x 1.8x 1.5x 1.3x 1.3x 10.3x 9.2x 7.7x 6.9x 6.8x 14.7% 17.5% 16.0% 16.8% 13.3% 19.1% 19.2% 19.2% 19.3% 18.7%

Manhattan Associates 6.0x 5.5x 4.9x 6.1x 7.3x 23.1x 20.2x 18.0x 22.1x 26.7x 10.2% 13.1% 15.7% 16.7% 18.7% 25.8% 27.2% 27.4% 27.5% 27.1%

Mavenir Systems - - - - - - - - - - 37.2% 41.0% 40.3% 35.5% 28.1% -3.7% -3.4% -4.1% -4.0% -8.4%

MedAssets 3.2x 3.2x 3.1x 3.0x 2.8x 10.3x 10.9x 10.5x 10.0x 9.4x 6.3% 2.3% 1.8% 2.8% 5.9% 30.9% 29.8% 29.6% 29.9% 29.9%

Mentor Graphics 2.2x 2.0x 2.1x 2.1x 2.2x 10.4x 10.2x 11.1x 11.1x 11.0x 6.2% 10.7% 10.1% 11.0% 7.6% 20.7% 20.0% 19.1% 18.9% 20.1%

Merge Healthcare 1.9x 1.9x 2.0x 2.4x 2.8x 17.2x 16.7x 15.2x 13.1x 16.8x -6.9% -13.0% -12.3% -12.5% -8.4% 11.1% 11.6% 13.4% 18.0% 16.9%

Microsoft 3.0x 3.3x 3.5x 3.6x 3.1x 7.7x 8.4x 9.6x 9.8x 8.7x 14.4% 9.6% 11.5% 13.9% 12.0% 39.0% 38.5% 37.0% 36.3% 36.0%

MicroStrategy 1.8x 1.9x 2.0x 2.4x 2.7x 26.1x 27.0x 40.3x 64.8x 39.2x 1.8% 4.7% 4.9% 5.5% 0.7% 7.0% 7.0% 5.1% 3.8% 6.9%

SEG Software Index




60

Company


Millennial Media 2.5x 1.3x 0.6x 0.4x 0.5x 1243.3x - - - - 45.9% 45.4% 38.2% 39.0% 14.3% 0.2% -2.0% -4.9% -7.3% -12.1%

MIND C.T.I. 1.2x 1.2x 1.8x 1.9x 1.9x 9.0x 6.8x 8.4x 7.1x 6.3x -8.6% 1.8% 16.7% 28.6% 35.4% 13.0% 17.3% 21.1% 26.1% 30.7%

MobileIron - - 5.3x 4.7x 4.2x - - - - - 158.2% 0.0% 0.0% 0.0% 25.3% -24.5% -33.8% -40.7% -43.4% -43.3%

Model N 1.7x 1.5x 1.5x 1.9x 2.4x 66.9x - - - - 14.2% 4.7% -8.3% -19.8% -18.6% 2.5% -1.9% -11.6% -22.4% -23.9%

Momo - - - - 40.5x - - - - - 0.0% 0.0% 0.0% 0.0% 1330.3% -272.2% -103.4% -72.4% -84.4% -52.1%

Monotype Imaging Holdings 6.4x 5.6x 6.0x 5.6x 6.3x 18.2x 16.5x 17.8x 16.8x 19.3x 11.2% 8.3% 9.0% 11.4% 10.7% 34.9% 34.2% 34.0% 33.5% 32.8%

MSCI 6.2x 5.2x 5.1x 5.1x 6.8x 13.4x 12.3x 12.4x 12.7x 16.4x 10.4% 12.3% 16.3% 19.6% 9.1% 46.1% 42.5% 41.2% 40.1% 41.3%

Myriad Group AG 3.5x 2.9x 5.6x 10.1x 10.5x - - - 87.5x 33.7x -23.3% -20.4% -17.3% -12.6% -6.9% -15.9% -11.4% -6.8% 11.5% 31.2%

NetApp 1.5x 1.2x 1.5x 1.5x 1.3x 9.8x 7.6x 8.9x 9.1x 8.2x 1.2% -0.1% -1.7% -1.9% -2.5% 15.2% 16.2% 16.4% 16.4% 16.0%

Netscout Systems 3.5x 3.6x 3.9x 3.1x 3.2x 14.9x 15.2x 16.0x 12.7x 12.4x 11.8% 13.1% 18.7% 19.4% 16.8% 23.7% 23.6% 24.6% 24.9% 25.5%

NetSol Technologies 1.2x 1.1x 1.2x 1.4x 1.5x 3.7x 7.4x - - - 2.3% -17.9% -21.7% -25.8% -9.6% 33.1% 15.2% -8.9% -20.2% -17.0%

NeuStar 2.9x 2.2x 2.2x 2.1x 2.0x 7.2x 5.7x 6.0x 5.8x 5.4x 8.5% 7.9% 8.2% 8.0% 6.8% 40.1% 38.7% 37.6% 36.2% 37.2%

NICE Systems Ltd 8.5x 8.0x 7.8x 10.1x 11.8x 47.0x 45.4x 46.2x 59.6x 63.0x 8.0% 6.8% 6.8% 7.7% 6.6% 18.0% 17.5% 16.9% 16.9% 18.7%

NQ Mobile 4.1x 2.2x 1.2x 1.3x 0.9x 553.4x 296.0x 166.1x - - 114.3% 114.3% 114.3% 95.4% 68.9% 0.7% 0.7% 0.7% -19.1% -20.1%

Nuance Communications, Inc. 3.4x 3.6x 3.7x 3.2x 3.2x 30.4x 35.0x 40.2x 34.0x 32.7x 6.3% 4.1% 2.2% 3.7% 3.5% 11.3% 10.2% 9.1% 9.5% 9.7%

Omnicell 2.3x 2.2x 2.1x 2.4x 2.4x 15.5x 15.4x 14.5x 16.1x 15.7x 21.2% 17.3% 14.4% 16.5% 15.8% 14.6% 14.3% 14.7% 15.2% 15.1%

Open Text Corp 4.4x 4.6x 4.7x 4.4x 4.2x 18.2x 17.9x 17.0x 15.2x 14.0x 7.6% 11.8% 19.2% 28.8% 35.4% 23.9% 25.5% 27.6% 29.3% 30.0%

Opera 32.7x 28.7x 30.9x 28.9x 18.5x 125.8x 113.7x 126.1x 127.4x 83.3x 38.9% 40.7% 39.9% 53.3% 60.2% 26.0% 25.2% 24.5% 22.7% 22.2%

Oracle 4.2x 4.5x 4.3x 4.2x 4.6x 9.6x 10.2x 9.9x 9.5x 10.6x 2.0% 2.9% 3.0% 3.4% 2.5% 43.6% 43.7% 43.7% 43.6% 43.2%

Palo Alto Networks 9.6x 8.7x 10.3x 12.8x 14.3x - - - - - 49.2% 48.1% 51.0% 51.1% 53.0% -4.6% -6.1% -7.5% -8.8% -10.4%

Pandora Media 9.8x 6.7x 6.4x 4.2x 3.2x - - - - - 54.1% 0.0% 0.0% 0.0% 40.6% -2.8% -1.0% -1.4% -1.0% -1.7%

Parametric Technology 3.3x 3.3x 3.4x 3.4x 3.2x 15.8x 15.0x 15.3x 15.4x 15.1x 3.3% 3.4% 4.8% 4.9% 4.5% 20.8% 21.8% 22.3% 21.9% 20.9%

PDF Solutions 5.7x 4.6x 4.9x 2.8x 4.4x 17.6x 13.1x 13.8x 8.9x 14.6x 13.3% 12.3% 9.5% 3.0% -1.3% 32.6% 34.8% 35.4% 31.8% 29.9%

Pegasystems 3.0x 2.3x 2.6x 2.4x 2.3x 18.5x 14.8x 17.9x 18.8x 17.7x 10.2% 14.2% 16.7% 15.0% 15.9% 15.9% 15.8% 14.4% 12.6% 12.8%

Progress Software 3.1x 2.7x 2.9x 3.1x 3.1x 11.1x 9.2x 9.5x 9.9x 11.9x 1.9% -0.8% -1.2% -0.4% 4.5% 28.3% 29.3% 30.9% 31.5% 26.5%

Proofpoint 9.7x 7.2x 8.2x 8.8x 10.6x - - - - - 29.8% 33.3% 39.0% 43.3% 41.8% -14.1% -13.4% -14.8% -15.7% -16.4%

PROS Holdings 6.7x 4.6x 4.3x 4.3x 3.6x 101.3x 209.1x - - - 23.0% 22.3% 22.1% 23.2% 28.3% 6.6% 2.2% -0.6% -2.7% -2.7%

QAD 0.9x 0.9x 0.9x 0.9x 0.9x 16.9x 15.9x 15.5x 14.1x 13.0x 5.6% 9.0% 10.3% 11.8% 10.8% 5.1% 5.7% 5.7% 6.5% 7.0%

Qihoo 360 Technology 17.3x 13.0x 11.1x 7.1x 5.1x 56.9x 43.6x 41.9x 28.7x 20.6x 104.0% 123.6% 121.3% 113.8% 107.2% 30.5% 29.8% 26.6% 24.7% 24.8%

Qiwi 0.2x 0.1x 0.1x 0.1x 0.1x 0.7x 0.5x 0.5x 0.3x 0.2x 30.9% 30.0% 26.3% 26.1% 26.2% 21.8% 25.6% 27.5% 30.8% 28.9%

Qlik Technologies 4.8x 3.6x 4.3x 4.5x 4.6x 193.7x 306.0x 259.6x 579.2x 892.7x 21.1% 19.5% 18.8% 20.1% 18.4% 2.5% 1.2% 1.7% 0.8% 0.5%

Quality Systems 2.2x 1.9x 1.8x 1.7x 1.8x 13.8x 13.7x 16.0x 18.5x 20.0x -3.7% -3.4% 0.3% 3.6% 8.2% 16.3% 13.9% 11.1% 9.0% 9.0%

Radware 3.4x 3.0x 2.9x 3.6x 3.8x 21.8x 21.0x 21.6x 24.5x 23.3x 2.0% 5.1% 8.4% 12.7% 15.0% 15.4% 14.4% 13.5% 14.8% 16.3%

Red Hat 6.5x 5.4x 6.1x 6.0x 6.7x 32.5x 27.9x 32.5x 32.4x 36.3x 15.5% 15.8% 16.6% 16.5% 16.6% 20.1% 19.2% 18.9% 18.6% 18.5%

Redknee Solutions 2.9x 2.1x 1.4x 1.3x 1.3x 80.7x 36.9x 118.5x 49.4x 27.4x 226.0% 349.5% 156.4% 81.4% 38.1% 3.6% 5.6% 1.2% 2.7% 4.8%

Riverbed Technology - - - - - - - - - - 24.4% 17.7% 12.9% 9.4% 4.6% 14.2% 15.3% 16.2% 17.0% 16.1%

Sage Group 3.7x 3.6x 3.4x 3.4x 4.2x 12.5x 12.2x 11.8x 11.9x 14.8x -0.5% -3.7% -4.4% -5.0% -5.0% 29.3% 29.5% 29.0% 28.4% 28.4%


SEG Software Index



61

Company


SAP 4.2x 4.0x 4.2x 3.9x 4.3x 12.3x 11.9x 12.7x 11.6x 12.6x 3.6% 2.7% 2.2% 2.9% 4.4% 34.0% 33.5% 32.8% 33.4% 34.2%

Sapiens International 2.2x 2.1x 2.1x 2.0x 1.9x 19.6x 18.3x 17.9x 17.2x 15.9x 18.8% 17.6% 16.6% 16.5% 16.3% 11.3% 11.3% 11.6% 11.8% 11.9%

Silver Spring Networks 2.1x 1.6x 1.5x 1.4x 1.7x - - - - - 66.1% 62.8% 3.5% -24.6% -41.5% -10.7% -7.3% -22.7% -38.5% -41.9%

Software AG 2.5x 2.4x 1.8x 1.9x 2.3x 9.9x 9.6x 7.8x 8.0x 9.2x -7.1% -6.0% -8.2% -9.8% -11.8% 25.0% 24.8% 23.6% 24.2% 25.4%

SolarWinds 9.1x 7.8x 7.9x 8.8x 8.3x 21.7x 20.4x 22.4x 26.3x 26.0x 24.7% 27.0% 29.3% 30.6% 27.8% 42.0% 38.1% 35.2% 33.3% 31.9%

Sourcefire 1.1x 1.1x 1.1x 0.9x 0.8x 10.2x 7.8x 8.3x 11.3x 12.1x 25.2% 36.0% 43.9% 20.2% 10.3% 10.5% 13.6% 12.7% 7.6% 6.7%

Splunk 28.6x 15.8x 13.2x 16.6x 14.5x - - - - - 52.1% 51.3% 51.6% 50.6% 49.0% -23.0% -31.3% -40.8% -44.9% -45.1%

SS&C 5.7x 5.7x 5.8x 6.3x 7.4x 14.4x 14.3x 15.0x 16.0x 19.0x 29.1% 14.9% 7.1% 6.8% 7.7% 39.5% 39.6% 39.0% 39.1% 38.9%

Stratasys 10.9x 7.7x 8.3x 7.0x 3.7x 65.8x 49.6x 57.2x 63.5x 27.6x 125.0% 101.2% 88.0% 71.8% 54.9% 16.5% 15.6% 14.6% 11.0% 13.6%

Symantec 1.9x 1.9x 2.2x 2.4x 2.4x 6.5x 6.6x 7.5x 8.1x 8.1x -3.3% -3.3% -3.5% -2.9% -2.7% 29.1% 29.1% 29.0% 29.2% 29.0%

Synchronoss Technologies 3.6x 3.4x 4.2x 4.2x 4.0x 16.3x 14.1x 16.2x 15.6x 14.9x 27.5% 28.5% 27.8% 30.5% 31.0% 21.9% 24.0% 25.7% 26.7% 26.6%

Synopsys 2.7x 2.6x 2.7x 2.8x 2.8x 14.9x 14.6x 15.3x 15.4x 14.9x 8.9% 6.0% 5.8% 4.9% 7.9% 18.3% 17.6% 17.8% 18.0% 18.9%

Take-Two Interactive 0.6x 0.6x 0.7x 0.8x 1.9x 2.8x 3.5x 3.5x 3.8x - 130.9% 93.5% 106.3% 129.5% -60.2% 21.4% 18.4% 19.3% 21.2% -4.9%

Tangoe 3.5x 2.8x 2.5x 2.2x 2.0x 40.8x 34.6x 34.2x 32.2x 26.0x 22.3% 17.7% 14.4% 13.5% 12.5% 8.7% 8.1% 7.2% 7.0% 7.7%

TeleCommunication Systems 0.6x 0.8x 0.7x 0.7x 0.8x 10.2x 12.1x 9.9x 9.3x 9.2x -25.7% -26.9% -24.8% -17.1% -0.7% 5.9% 6.3% 7.4% 7.8% 8.4%

TeleNav 0.3x 0.5x 0.6x 0.9x 1.3x 22.4x - - - - -6.2% -16.9% -21.6% -27.2% -21.7% 1.5% -7.6% -15.7% -24.4% -25.6%

Teradata 2.5x 2.3x 2.2x 2.2x 2.2x 11.0x 9.5x 9.5x 9.5x 10.2x 1.0% 3.6% 3.6% 2.9% 1.5% 23.1% 23.7% 23.2% 23.0% 22.0%

The Descartes Systems Group 6.2x 5.9x 6.6x 6.7x 7.5x 21.9x 20.8x 23.1x 23.1x 25.2x 19.2% 20.6% 17.2% 15.3% 12.9% 28.1% 28.2% 28.7% 29.1% 29.5%

Trend Micro 2.8x 3.0x 3.3x 3.2x 2.9x 8.3x 8.6x 9.3x 9.1x 8.0x 15.4% 13.5% 9.8% 7.8% 6.4% 33.9% 34.7% 35.1% 35.0% 35.8%

Tyler Technologies 7.3x 5.9x 6.3x 7.2x 7.3x 38.5x 30.2x 30.9x 33.6x 33.6x 14.7% 15.2% 17.2% 18.7% 18.4% 18.9% 19.5% 20.5% 21.5% 21.8%

Ubisoft Entertainment 1.3x 1.6x 1.3x 1.3x 1.6x 4.3x 5.0x 4.2x 4.7x 5.5x -3.0% -19.8% -12.7% -5.7% -5.7% 30.0% 32.9% 30.3% 28.0% 28.0%

Varonis Systems - 6.1x 4.9x 4.7x 6.6x - - - - - 39.7% 43.7% 38.0% 38.3% 35.8% -6.8% -11.1% -14.0% -16.0% -15.8%

Verint Systems Inc 3.0x 2.8x 3.7x 3.8x 3.5x 17.0x 17.0x 25.4x 28.5x 25.0x 8.1% 13.2% 18.3% 21.8% 24.4% 17.8% 16.6% 14.5% 13.3% 14.2%

Verisk 7.4x 6.7x 6.8x 6.6x 6.9x 16.0x 14.6x 14.9x 14.4x 15.2x 13.3% 13.3% 14.2% 15.7% 9.5% 46.1% 45.6% 45.4% 45.4% 45.2%

VMWare 6.9x 6.8x 6.6x 5.3x 4.9x 24.4x 24.4x 25.2x 21.0x 19.3x 13.1% 13.4% 15.0% 15.9% 15.9% 28.1% 27.8% 26.0% 25.2% 25.3%


SEG Software Index


THE SEG SOFTWARE INDEX METRICS BY PRODUCT CATEGORY

62

Billing & Service Management 1Q14 2Q14 3Q14 4Q14 1Q15


EV/EBITDA 9.3x 10.1x 9.9x 9.4x 9.7x



EBITDA Margin 18.5% 18.4% 21.1% 26.1% 26.6%


TTM Revenue Growth (YoY) 3.6% 4.8% 8.2% 12.9% 18.3%

TTM EBITDA Growth (YoY) -0.1% 1.7% -0.5% 27.4% 51.2%

TTM Earnings Growth (YoY) -4.8% -9.2% -3.3% 5.3% 28.1%

Current Ratio 2.5 2.7 2.7 2.6 2.6

Cash as Percent of Market Cap 16.1% 17.4% 18.2% 22.5% 21.1%

Enterprise Value Growth (YoY) 26.1% 33.3% 23.2% 2.5% 0.0%

Business Intelligence 1Q14 2Q14 3Q14 4Q14 1Q15


EV/EBITDA 17.3x 14.7x 14.9x 14.4x 16.7x



EBITDA Margin 16.6% 16.8% 16.4% 15.6% 15.7%



TTM EBITDA Growth (YoY) 3.8% 4.7% 0.7% -11.6% -5.1%

TTM Earnings Growth (YoY) -7.3% -0.1% 0.1% -4.2% -7.6%

Current Ratio 2.0 2.0 2.0 2.0 1.9


Enterprise Value Growth (YoY) 15.6% 4.8% -13.0% -8.8% -2.7%

Development Platforms 1Q14 2Q14 3Q14 4Q14 1Q15


EV/EBITDA 10.7x 9.4x 9.5x 9.9x 9.2x



EBITDA Margin 20.1% 19.2% 19.2% 19.3% 18.7%


TTM Revenue Growth (YoY) 1.9% -0.8% 1.2% 4.4% 4.5%

TTM EBITDA Growth (YoY) 2.6% 6.1% 14.0% 13.3% 6.9%

TTM Earnings Growth (YoY) -10.3% -4.1% -6.5% -9.7% -10.3%

Current Ratio 2.0 2.1 2.4 2.5 1.6



Engineering & PLM 1Q14 2Q14 3Q14 4Q14 1Q15


EV/EBITDA 16.4x 14.9x 15.6x 16.0x 15.7x



EBITDA Margin 20.8% 20.0% 19.9% 19.9% 20.9%



TTM EBITDA Growth (YoY) 3.9% 6.0% 5.8% -0.5% 4.8%

TTM Earnings Growth (YoY) 8.6% -1.2% 15.3% 4.6% -3.3%

Current Ratio 2.4 2.3 2.0 2.1 1.7


Enterprise Value Growth (YoY) 25.6% 15.0% 14.9% -4.4% 1.9%

Enterprise Resource Planning 1Q14 2Q14 3Q14 4Q14 1Q15


EV/EBITDA 12.5x 12.2x 11.9x 11.9x 13.0x



EBITDA Margin 29.3% 29.5% 29.0% 28.4% 28.4%



TTM EBITDA Growth (YoY) 0.9% -0.2% -1.2% 0.4% 1.6%

TTM Earnings Growth (YoY) 0.2% 16.0% 7.7% 6.6% -1.4%

Current Ratio 1.2 1.2 1.2 1.2 1.5



Financial & Accounting 1Q14 2Q14 3Q14 4Q14 1Q15


EV/EBITDA 13.1x 12.6x 13.2x 13.8x 15.1x



EBITDA Margin 25.9% 25.6% 26.0% 25.2% 23.3%




TTM Earnings Growth (YoY) 2.0% 11.0% 34.2% 34.4% 16.4%

Current Ratio 1.3 1.2 1.3 1.3 1.2



Gaming 1Q14 2Q14 3Q14 4Q14 1Q15


EV/EBITDA 11.2x 14.1x 13.3x 12.2x 12.5x



EBITDA Margin 18.5% 15.9% 15.5% 18.6% 18.5%


TTM Revenue Growth (YoY) -3.6% -4.8% 0.2% 1.0% -3.2%

TTM EBITDA Growth (YoY) -9.1% -6.7% -20.2% -21.7% -8.0%

TTM Earnings Growth (YoY) -18.9% -50.8% -15.1% -41.9% -39.5%

Current Ratio 2.4 3.0 3.2 2.8 2.5



Healthcare 1Q14 2Q14 3Q14 4Q14 1Q15


EV/EBITDA 14.6x 14.6x 14.8x 14.6x 16.2x



EBITDA Margin 15.4% 14.1% 14.1% 16.6% 16.0%



TTM EBITDA Growth (YoY) -1.4% -0.9% 8.4% 12.2% 11.0%


Current Ratio 1.8 1.6 1.6 1.5 1.5



IT Conglomerates 1Q14 2Q14 3Q14 4Q14 1Q15


EV/EBITDA 8.7x 8.6x 9.6x 9.5x 8.7x



EBITDA Margin 34.0% 33.5% 32.8% 33.4% 34.2%




TTM Earnings Growth (YoY) 11.9% 8.1% 3.1% -2.0% -6.6%

Current Ratio 1.3 1.2 1.2 1.1 1.2



Mobile Solutions/Content 1Q14 2Q14 3Q14 4Q14 1Q15


EV/EBITDA 39.9x 34.6x 16.2x 22.2x 23.3x



EBITDA Margin 3.7% 2.5% -0.3% 4.7% 3.8%





Current Ratio 2.6 2.9 3.1 3.1 3.6


Enterprise Value Growth (YoY) 29.1% 32.2% 28.0% -10.3% -34.8%

Networking & Network Perf Mgmt 1Q14 2Q14 3Q14 4Q14 1Q15


EV/EBITDA 15.3x 18.2x 18.6x 20.4x 17.3x



EBITDA Margin 1.5% 2.2% 4.4% 7.0% 9.9%

Net Income Margin -1.6% -0.4% 0.7% 1.5% -2.1%



TTM Earnings Growth (YoY) -0.8% 1.7% 9.1% 12.2% 13.1%

Current Ratio 2.6 2.7 2.8 2.6 2.4



Security 1Q14 2Q14 3Q14 4Q14 1Q15


EV/EBITDA 10.2x 11.6x 12.1x 16.7x 17.2x



EBITDA Margin 10.5% 10.9% 12.5% 7.6% 6.7%





Current Ratio 1.7 1.8 1.9 1.9 1.9




THE SEG SOFTWARE INDEX METRICS BY PRODUCT CATEGORY

63

Storage, Data Mgmt & Integration 1Q14 2Q14 3Q14 4Q14 1Q15


EV/EBITDA 9.1x 8.1x 8.9x 9.1x 9.3x



EBITDA Margin 17.8% 18.0% 17.7% 17.5% 17.3%



TTM EBITDA Growth (YoY) 6.9% 8.5% 8.8% 0.8% -3.0%


Current Ratio 2.4 2.5 2.5 2.5 2.3



Systems Management 1Q14 2Q14 3Q14 4Q14 1Q15


EV/EBITDA 18.9x 17.8x 19.4x 18.5x 17.4x



EBITDA Margin 25.9% 25.7% 25.3% 25.0% 25.4%





Current Ratio 1.3 1.3 1.2 1.4 1.5



Vertical - Finance 1Q14 2Q14 3Q14 4Q14 1Q15


EV/EBITDA 13.9x 13.3x 13.7x 14.4x 16.6x



EBITDA Margin 26.7% 26.8% 29.3% 29.9% 30.3%





Current Ratio 1.3 1.4 1.4 1.4 1.4



Vertical - Other 1Q14 2Q14 3Q14 4Q14 1Q15


EV/EBITDA 26.5x 24.3x 24.4x 27.0x 29.1x



EBITDA Margin 12.8% 13.5% 11.6% 11.8% 11.9%



TTM EBITDA Growth (YoY) 7.6% 17.6% 4.0% -0.4% 22.4%


Current Ratio 1.6 1.7 1.6 1.6 1.5




THE SEG SaaS INDEX COMPANIES – KEY METRICS

64

Company


2U - 6.9x 6.6x 6.1x 5.9x - - - - - 48.8% - - 39.5% 32.6% -32.9% -32.8% -32.3% -27.0% -24.4%

Amber Road - 6.0x 5.6x 4.1x 3.1x - - - - - 21.1% 24.4% 30.2% 30.6% 23.4% -22.1% -50.3% -40.9% -34.6% -35.2%

Athenahealth 10.7x 7.8x 7.5x 6.8x 6.9x 115.6x 83.8x 82.7x 80.8x 84.1x 40.9% 40.1% 36.0% 31.7% 26.5% 9.2% 9.2% 9.1% 8.4% 8.2%

Bazaarvoice 3.2x 2.9x 3.1x 2.9x 3.1x - - - - - 4.4% 14.5% 14.7% 16.9% 20.0% -13.2% -17.7% -17.4% -15.1% -12.1%

Benefitfocus 14.4x 7.7x 7.6x 5.0x 5.2x - - - - - 28.2% 29.0% 31.1% 31.8% 31.2% -21.7% -26.0% -30.8% -37.5% -37.6%

Callidus Software 5.2x 4.0x 4.1x 5.6x 5.1x - - - - - 18.3% 19.6% 23.6% 19.8% 21.6% -4.0% -1.7% -0.2% -1.4% -1.9%

Castlight Health - 64.0x 36.4x 24.6x 13.0x - - - - - 212.3% - - 295.4% 251.5% -475.6% -382.4% -295.7% -235.1% -186.0%

ChannelAdvisors 13.4x 6.8x 4.3x 4.5x 2.1x - - - - - 26.9% 28.5% 28.9% 28.4% 24.8% -15.9% -24.4% -30.4% -34.1% -33.2%

Constant Contact 2.6x 2.6x 2.8x 2.9x 3.3x 27.5x 25.0x 25.3x 24.7x 29.1x 13.2% 13.7% 14.4% 15.1% 16.2% 9.4% 10.3% 11.0% 11.6% 11.2%

Cornerstone OnDemand 15.6x 10.0x 9.3x 7.3x 6.7x - - - - - 57.0% 55.7% 48.8% 45.2% 42.4% -16.1% -15.5% -16.6% -15.8% -16.1%

Covisint 3.3x 2.1x 1.3x 0.7x 0.5x - - - - - 13.9% 7.1% 0.4% -6.4% -9.1% -26.0% -34.6% -43.2% -38.3% -37.6%

Cvent 12.4x 8.4x 7.2x 7.0x 6.8x 545.7x 303.5x 156.5x 121.3x 188.6x 33.1% 31.9% 29.6% 28.4% 28.0% 2.3% 2.8% 4.6% 5.8% 3.6%

DealerTrack 4.5x 5.1x 4.6x 4.1x 3.2x 38.1x 44.6x 37.2x 30.7x 26.1x 23.8% 30.8% 46.9% 62.6% 77.4% 11.8% 11.4% 12.4% 13.2% 12.4%

Demandware 21.1x 15.2x 13.6x 12.6x 11.2x - - - - - 28.0% 37.5% 44.5% 50.3% 50.6% -12.9% -14.8% -13.7% -11.2% -13.2%

E2open - - - - - - - - - - -4.9% -0.5% 9.2% 13.0% 13.0% -29.4% -29.7% -32.4% -33.1% -33.1%

Ebix 2.9x 3.0x 2.6x 3.0x 4.1x 7.8x 8.1x 6.9x 7.6x 11.2x 2.7% -2.2% -3.5% -1.6% 4.7% 37.1% 36.7% 38.5% 39.1% 36.9%

- 5.4x 5.2x 6.5x 7.3x 8.5x 27.6x 31.7x 38.8x 40.3x 43.5x 26.2% 16.1% 10.6% 13.5% 25.7% 19.5% 16.3% 16.7% 18.1% 19.5%

FireEye 55.6x 23.6x 16.3x 12.3x 13.4x - - - - - 93.9% 111.5% 132.9% 150.0% 163.5% -88.4% -100.5% -103.6% -99.3% -89.3%

Fleetmatics 7.3x 5.4x 5.2x 5.5x 5.7x 29.0x 22.4x 23.8x 23.4x 22.8x 39.2% 38.3% 35.7% 33.5% 30.6% 25.3% 24.0% 21.9% 23.6% 25.1%

Halogen Software 4.8x 2.7x 2.7x 2.6x 2.3x - - - - - 26.3% 22.4% 21.3% 18.9% 18.1% -7.4% -8.9% -11.7% -14.8% -18.0%

HortonWorks - - - - 17.8x - - - - - - - - - 71.8% -222.1% -219.0% -201.5% -220.8% -365.1%

HubSpot - - - 10.9x 10.0x - - - - - 50.4% - - - 49.3% -42.2% -40.4% -35.7% -33.4% -40.4%

inContact 3.5x 3.4x 3.6x 3.1x 3.3x - - - - - 17.9% 16.4% 19.9% 25.3% 32.1% -2.3% -2.1% -3.2% -4.5% -4.1%

IntraLinks Holdings 2.5x 2.1x 2.0x 2.4x 2.5x 46.2x 44.2x 56.1x 79.6x 53.9x 8.2% 8.1% 8.7% 9.5% 9.1% 5.5% 4.7% 3.6% 3.1% 4.7%

J2 Global 4.3x 4.2x 4.4x 4.6x 5.4x 10.5x 9.9x 10.5x 11.1x 12.9x 40.2% 35.9% 21.0% 17.6% 15.0% 41.3% 42.2% 41.5% 41.8% 41.6%

Jive Software 3.5x 3.0x 2.5x 1.9x 1.5x - - - - - 28.2% 25.2% 23.4% 22.5% 22.6% -40.9% -39.6% -35.3% -29.8% -22.2%

Liquid Holdings Group - - - - - - - - - - 137.4% 14.1% -10.9% 1.3% 1.3% - - - - -

LivePerson 3.6x 2.5x 3.2x 3.4x 2.7x 101.1x 69.3x 73.7x 65.8x 54.0x 13.0% 12.3% 13.8% 14.5% 18.1% 3.5% 3.5% 4.3% 5.1% 5.0%

TTM Revenue Growth EBITDA Margin

SEG SaaS Index



THE SEG SaaS INDEX COMPANIES – KEY METRICS

65

Company


Marin Software 3.1x 2.8x 2.5x 2.4x 1.8x - - - - - 29.8% 30.2% 30.5% 29.8% 28.5% -38.3% -33.2% -30.5% -29.4% -27.0%

Marketo 15.2x 8.8x 8.6x 8.8x 7.1x - - - - - 64.2% 64.5% 63.7% 60.5% 56.3% -42.5% -39.1% -34.4% -32.5% -31.0%

Medical Transcript - - 3.4x 2.6x 1.5x - - 52.1x 2173.1x - 4.5% - - 43.2% 74.8% 10.5% 8.6% 6.5% 0.1% -9.6%

Medidata Solutions 11.4x 7.4x 8.0x 7.3x 7.4x 102.5x 83.8x 96.9x 92.2x 68.7x 26.8% 25.5% 24.2% 22.8% 21.0% 11.1% 8.9% 8.2% 7.9% 10.8%

Netsuite 18.7x 13.2x 13.1x 15.4x 13.2x - - - - - 34.2% 34.6% 33.4% 33.5% 34.2% -8.9% -8.8% -8.1% -8.7% -9.2%

New Relic - - - - 14.6x - - - - - - 113.0% - - 82.2% -74.9% -58.6% -50.2% -44.0% -40.8%

OPOWER - 9.1x 7.2x 5.6x 3.8x - - - - - 71.4% 64.2% 54.4% 52.0% 44.8% -13.1% -16.2% -26.7% -27.2% -29.7%

Paylocity Holding - 9.4x 9.0x 10.4x 10.6x - 480.7x - - - - - 40.6% 40.1% 41.2% 2.2% 2.0% -1.9% -5.1% -7.3%

Q2 Holdings - 7.2x 6.3x 7.3x 7.8x - - - - - 38.4% - - 36.7% 39.1% -22.9% -26.0% -24.8% -21.5% -18.9%

Qualys 7.2x 5.7x 6.0x 8.3x 10.2x 65.4x 50.9x 50.4x 62.6x 64.4x 18.1% 19.3% 20.4% 21.7% 23.7% 11.0% 11.1% 11.8% 13.2% 15.8%

Rally Software Development 5.4x 3.0x 2.2x 2.2x 2.7x - - - - - 30.8% 29.7% 20.2% 17.6% 17.7% -21.1% -24.0% -31.3% -31.8% -33.8%

RealPage 4.2x 3.8x 3.2x 4.2x 3.9x 28.9x 27.1x 29.6x 47.1x 53.5x 17.0% 15.4% 10.4% 7.7% 7.3% 14.4% 14.0% 10.8% 8.9% 7.2%

RingCentral 7.6x 4.8x 4.2x 3.6x 4.2x - - - - - 40.1% 38.3% 38.5% 37.1% 37.0% -18.0% -20.2% -20.5% -19.4% -15.8%

Salesforce.com 9.3x 7.8x 7.5x 7.6x 7.5x - - 11552.5x 442.6x 240.5x 33.5% 35.7% 37.3% 34.9% 32.0% -1.5% -0.7% 0.1% 1.7% 3.1%

SciQuest 7.2x 4.7x 3.3x 2.8x 3.1x - 280.8x 114.7x 61.7x 61.7x 35.8% 30.6% 25.8% 21.6% 13.0% -0.2% 1.7% 2.9% 4.6% 5.1%

Service-now.com 20.4x 15.2x 15.4x 15.2x 15.8x - - - - - 74.2% 69.3% 65.5% 62.8% 60.7% -10.1% -13.1% -15.5% -16.2% -16.1%

SPS Commerce 9.0x 6.9x 6.6x 6.6x 7.5x 95.2x 72.8x 67.6x 65.7x 72.2x 35.4% 29.9% 24.8% 21.9% 22.6% 9.4% 9.5% 9.7% 10.0% 10.3%

Tableau Software 21.7x 13.5x 12.1x 14.3x 14.3x 479.2x 231.4x 242.9x 449.9x 296.7x 82.0% 86.6% 87.8% 82.1% 77.5% 4.5% 5.8% 5.0% 3.2% 4.8%

Tangoe 3.5x 2.8x 2.5x 2.2x 2.0x 40.8x 34.6x 34.2x 32.2x 26.0x 22.3% 17.7% 14.4% 13.5% 12.5% 8.7% 8.1% 7.2% 7.0% 7.7%

Textura 14.9x 8.1x 10.7x 8.9x 9.6x - - - - - 50.5% - - 0.0% 54.5% -81.4% -49.3% -23.0% -19.0% -27.0%

The Ultimate Software Group 10.5x 8.1x 8.7x 8.5x 8.9x 72.0x 55.3x 59.7x 59.4x 61.9x 23.5% 23.2% 23.7% 23.5% 23.3% 14.5% 14.6% 14.5% 14.2% 14.4%

TrueCar - - 6.7x 7.3x 6.4x - - - - - 67.7% 0.0% 0.0% 66.1% 54.3% -11.9% -11.3% -16.6% -20.1% -19.3%

Upland Software - - - 3.0x 2.9x - - - - - 81.0% 0.0% 0.0% 0.0% 56.8% 5.9% 5.7% 4.9% -14.4% -13.1%

Veeva Systems 17.9x 10.3x 10.8x 11.4x 10.6x 92.3x 52.7x 52.8x 52.1x 45.6x 62.2% 58.3% 54.9% 54.4% 49.0% 19.4% 19.5% 20.4% 21.8% 23.3%

SEG SaaS Index



THE SEG SaaS INDEX METRICS BY PRODUCT CATEGORY

66

CRM & Marketing 1Q14 2Q14 3Q14 4Q14 1Q15


EV/EBITDA 101.1x 69.3x 115.1x 93.5x 121.3x



EBITDA Margin -13.2% -17.7% -17.4% -15.1% -12.1%





Current Ratio 2.3 2.3 2.1 2.0 1.9


Enterprise Value Growth (YoY) 28.9% 18.3% 0.0% 5.4% -12.7%

ERP & Supply Chain 1Q14 2Q14 3Q14 4Q14 1Q15


EV/EBITDA 62.1x 72.8x 67.6x 61.7x 61.7x



EBITDA Margin -4.5% -3.6% -2.6% -2.1% -2.1%





Current Ratio 3.0 2.8 2.8 2.9 2.7



Vertically Focused 1Q14 2Q14 3Q14 4Q14 1Q15


EV/EBITDA 38.1x 44.6x 45.5x 49.6x 45.6x



EBITDA Margin 10.5% 8.9% 8.2% 7.9% 7.2%

Net Income Margin 0.4% -1.1% -1.7% -2.1% -2.5%


TTM EBITDA Growth (YoY) -10.8% -18.3% -16.1% -3.0% 4.3%

TTM Earnings Growth (YoY) -16.0% 0.0% 0.0% -0.8% 9.3%

Current Ratio 1.5 1.8 2.3 2.7 2.9



Workforce Management 1Q14 2Q14 3Q14 4Q14 1Q15

EV/Revenue 10.5x 7.7x 7.6x 7.3x 6.7x

EV/EBITDA 51.1x 54.6x 55.2x 59.4x 61.9x



EBITDA Margin -4.0% -1.7% -1.9% -5.1% -7.3%



TTM EBITDA Growth (YoY) 2.5% -7.0% -21.7% -27.6% -32.0%


Current Ratio 2.0 2.0 1.7 1.6 1.4



Other SaaS 1Q14 2Q14 3Q14 4Q14 1Q15


EV/EBITDA 46.2x 44.2x 50.4x 62.6x 53.9x



EBITDA Margin -18.0% -24.0% -30.4% -29.8% -22.2%




TTM Earnings Growth (YoY) -5.8% -1.1% 0.0% 0.0% 939.6%

Current Ratio 2.4 2.5 2.2 2.2 2.3




THE SEG INTERNET INDEX COMPANIES – KEY METRICS

67

Company


1-800-FLOWERS.COM 0.5x 0.5x 0.5x 0.6x 0.7x 7.6x 9.3x 7.8x 5.5x 8.0x 4.5% 1.2% 2.8% 36.3% 45.6% 6.2% 5.2% 5.9% 10.1% 8.2%

58.com 22.2x 18.4x 20.1x 13.2x 11.4x 167.8x 119.1x 138.5x 123.5x 246.5x 67.3% 86.4% 86.7% 83.8% 81.8% 13.2% 15.5% 14.5% 10.7% 4.6%

8x8 6.3x 4.6x 3.8x 3.5x 3.4x 76.9x 69.9x 82.6x 84.3x 57.8x 20.4% 23.9% 27.3% 27.8% 28.2% 8.2% 6.6% 4.6% 4.1% 5.9%

Akamai Technologies 6.2x 5.7x 6.0x 5.8x 6.2x 17.4x 16.0x 17.1x 16.5x 17.7x 14.8% 16.9% 19.9% 22.6% 24.5% 35.3% 35.5% 35.1% 35.0% 34.8%

Alibaba - - - 4.0x 2.9x - - - 8.7x 7.0x - 52.1% - - 44.1% 54.1% 53.0% 51.6% 46.5% 41.9%

Amazon.com 2.2x 1.8x 1.9x 1.7x 1.9x 46.2x 37.7x 38.2x 37.3x 39.2x 21.9% 22.1% 22.3% 21.5% 19.5% 4.8% 4.9% 4.9% 4.6% 4.9%

Angie's List 3.2x 2.4x 1.5x 1.2x 1.1x - - - - - 57.7% 50.5% 43.2% 35.2% 28.2% -9.8% -7.3% -8.7% -5.4% -1.4%

AOL 1.5x 1.3x 1.4x 1.4x 1.3x 8.0x 7.1x 7.8x 8.1x 7.4x 5.8% 7.5% 9.9% 11.4% 8.9% 18.7% 18.4% 18.2% 17.4% 17.3%

Baidu.com 1.7x 1.5x 1.8x 1.7x 1.4x 4.0x 3.7x 4.7x 4.8x 4.2x 43.2% 47.7% 52.8% 54.8% 53.6% 43.3% 40.5% 38.4% 36.2% 34.2%

Bankrate 4.0x 3.7x 3.3x 2.5x 2.7x 16.7x 15.6x 14.3x 11.0x 11.9x 0.1% 10.2% 20.4% 24.0% 24.0% 23.8% 23.6% 23.2% 22.5% 22.5%

Bitauto Holdings 0.9x 0.9x 1.7x 1.5x 1.1x 4.7x 4.4x 7.2x 6.2x 4.5x 36.2% 38.9% 43.7% 50.1% 70.8% 20.0% 20.9% 23.5% 24.4% 24.1%

BlueNile 0.8x 0.7x 0.6x 0.8x 0.6x 21.8x 19.1x 17.4x 22.6x 18.0x 12.5% 10.3% 5.0% 5.0% 5.2% 3.5% 3.6% 3.6% 3.6% 3.3%

Borderfree - 3.5x 2.8x 1.5x 0.7x - 365.7x 264.5x 111.3x - 35.7% 20.6% 17.4% 20.4% 13.6% 1.2% 1.0% 1.1% 1.4% -0.1%

Brightcove 2.6x 2.3x 1.5x 1.5x 1.8x - - - - - 24.9% 25.4% 22.8% 18.1% 13.8% -1.7% -0.9% -1.0% -1.6% -3.1%

BroadSoft 4.2x 3.4x 3.2x 3.6x 3.6x 659.2x - 617.6x 84.7x 40.8x 8.3% 10.0% 12.8% 17.8% 21.5% 0.6% -1.7% 0.5% 4.2% 8.7%

Carbonite 2.0x 1.9x 1.9x 2.0x 2.7x 91.5x 24.2x 26.4x 26.4x 72.6x 27.5% 24.2% 20.8% 17.1% 14.4% 2.2% 7.8% 7.2% 7.5% 3.7%

Care.com 8.3x 3.1x 1.6x 1.4x 1.4x - - - - - 68.0% - 41.1% 43.2% 43.2% -24.1% -29.3% -30.5% -27.0% -27.0%

ChangYou.com 1.9x 1.7x 1.6x 1.7x 1.9x 4.0x 5.7x 9.5x 31.8x 18.8x 18.4% 11.6% 5.3% 2.5% 2.4% 47.6% 29.8% 16.5% 5.3% 10.0%

Chegg 1.9x 1.4x 1.7x 1.6x 1.7x 17.4x 15.7x 27.7x 31.4x 21.1x 19.8% 19.1% 16.8% 20.6% 19.3% 10.8% 8.8% 6.3% 5.0% 7.8%

Cimpress 1.5x 1.2x 1.5x 2.0x 2.2x 13.5x 11.4x 11.7x 13.9x 14.8x 9.6% 6.5% 8.8% 11.6% 15.2% 11.2% 10.9% 13.0% 14.0% 14.6%

Coupons.com - 8.2x 5.0x 4.8x 3.5x - - - - - 49.7% - - 41.9% 32.1% -2.2% -4.9% -6.6% -6.2% -8.3%

Criteo SA 4.5x 3.2x 2.7x 3.0x 2.9x 86.9x 52.2x 36.3x 40.4x 35.3x 63.3% 61.7% 60.8% 64.2% 67.8% 5.1% 6.2% 7.5% 7.4% 8.2%

Ctrip 1.0x 1.2x 1.3x 1.1x 0.9x 5.5x 7.7x 10.7x 13.0x 237.2x 29.5% 31.7% 34.3% 36.2% 36.4% 17.8% 15.0% 12.3% 8.3% 0.4%

DangDang 0.1x 0.1x 0.1x 0.1x 0.1x - - 21.2x 6.5x 4.1x 21.8% 23.6% 25.6% 28.5% 25.8% -2.3% -0.8% 0.6% 1.3% 1.4%

DemandMedia 2.0x 0.8x 0.3x 0.2x 0.3x 10.2x 10.1x 3.7x 2.4x 3.7x 0.9% -2.8% 21.6% 40.0% -17.7% 19.3% 8.3% 8.6% 8.0% 8.3%

eBay 4.1x 3.7x 3.7x 3.7x 3.8x 13.8x 12.6x 12.8x 13.1x 13.3x 14.0% 13.9% 13.5% 12.9% 11.6% 29.7% 29.6% 29.2% 28.3% 28.1%

eHealth 4.8x 3.3x 2.1x 2.0x 0.7x 75.0x 140.8x 44.7x 31.7x 174.4x 15.2% 15.7% 14.4% 10.9% 0.3% 6.5% 2.3% 4.6% 6.4% 0.4%

Envivio 1.1x 0.5x 0.2x 0.0x 0.1x - - - - - 10.5% 33.2% 29.9% 7.5% -3.8% -20.8% -19.8% -23.4% -28.8% -24.5%

Everyday Health - 4.0x 2.9x 2.2x 2.3x - 46.8x 33.1x 25.2x 20.7x 12.5% 17.1% - 23.2% 18.3% 6.8% 8.5% 8.9% 8.8% 11.1%

Expedia 2.0x 1.9x 2.0x 1.9x 2.1x 14.9x 14.3x 14.2x 13.3x 15.9x 18.4% 17.3% 19.5% 21.0% 20.8% 13.7% 13.2% 13.8% 14.3% 13.1%

Facebook 19.4x 16.3x 18.0x 17.6x 16.4x 38.8x 31.2x 33.2x 32.6x 32.7x 54.7% 62.4% 63.7% 63.0% 58.4% 49.9% 52.1% 54.2% 54.0% 49.9%

GeekNet 0.5x 0.3x 0.2x 0.2x 0.1x 67.1x 69.7x - - - 16.3% 16.9% 14.1% 9.5% 1.8% 0.8% 0.4% -1.2% -2.0% -4.8%

Giant Interactive 124.8x 61.7x 22.3x 10.9x 7.2x - - - - - - - - - 708.3% -576.9% - - - -91.1%

GoDaddy - - - - - - - - - - 24.1% - - - 22.7% 0.8% 0.8% 1.0% 3.1% 6.2%

Google 6.2x 5.5x 5.3x 4.7x 4.7x 17.7x 16.1x 17.8x 15.8x 14.6x 20.6% 10.5% 21.1% 25.2% 18.9% 34.8% 34.3% 29.8% 29.4% 32.5%

Groupon 2.3x 1.2x 1.2x 1.3x 1.3x 41.8x 28.0x 36.3x 44.7x 47.0x 10.2% 14.9% 18.9% 24.2% 24.0% 5.4% 4.3% 3.3% 3.0% 2.8%

GrubHub - 14.6x 13.3x 11.4x 11.5x - 63.6x 60.9x 48.2x 44.1x 66.6% - - 108.9% 85.1% 22.3% 23.0% 21.8% 23.7% 26.2%


SEG Internet Index



68

Company


Harmonic 1.0x 1.2x 1.0x 1.1x 1.3x 16.0x 20.8x 19.2x 21.6x 30.7x 1.3% 0.8% -3.0% -3.0% -6.1% 6.5% 5.6% 5.2% 5.2% 4.3%

HomeAway 10.0x 7.0x 6.6x 5.7x 5.2x 58.4x 43.1x 40.4x 37.6x 35.6x 23.6% 26.0% 28.8% 30.4% 28.9% 17.1% 16.1% 16.3% 15.2% 14.6%

Interactive Intelligence 4.4x 3.1x 2.5x 2.6x 2.5x 52.3x 49.7x 80.2x 178.7x - 34.1% 25.8% 17.4% 13.9% 7.2% 8.4% 6.3% 3.2% 1.5% -0.2%

InterActiveCorp 2.0x 1.9x 1.9x 1.8x 1.7x 10.9x 10.7x 10.9x 11.3x 11.2x 7.9% 4.1% -1.4% -2.0% 2.9% 18.0% 17.5% 17.3% 15.7% 15.6%

LendingClub - - - - - - - - - - 189.9% 168.6% 150.5% 130.6% 115.4% - - - - -

LifeLock 4.4x 2.6x 2.6x 3.0x 2.2x 52.9x 36.3x 39.3x 41.8x 28.4x 33.7% 31.3% 30.6% 29.6% 28.8% 8.4% 7.1% 6.6% 7.1% 7.8%

Limelight Networks 0.5x 0.6x 0.8x 1.0x 1.2x - - - - - -3.8% -7.1% -7.0% -7.9% -6.4% -5.9% -7.0% -5.6% -4.4% -3.5%

LinkedIn 14.6x 10.5x 12.6x 12.3x 13.5x 133.8x 106.0x 118.2x 109.9x 129.3x 57.2% 51.3% 48.5% 46.0% 45.2% 10.9% 9.9% 10.6% 11.2% 10.5%

Liquidity Services 1.4x 0.8x 0.7x 0.6x 0.4x 7.9x 5.4x 5.7x 5.8x 4.3x 2.9% 1.5% 1.5% -2.0% -1.3% 17.4% 15.0% 13.1% 10.2% 9.7%

Mail.ru Group 0.3x 0.2x 0.2x 0.1x 0.1x 0.7x 0.5x 0.4x 0.3x 0.2x 29.4% 26.8% 24.5% 21.8% 19.5% 43.2% 44.4% 45.5% 47.1% 48.6%

MakeMyTrip 3.6x 3.9x 4.1x 3.8x 3.3x - - - - - 13.2% 11.6% 12.9% 17.5% 16.9% -7.8% -5.1% -3.5% -2.4% -2.8%

Marchex 2.2x 2.4x 1.7x 0.5x 0.5x 53.6x 52.7x 32.3x 8.8x 11.2x 14.9% 27.5% 30.3% 30.1% 19.7% 4.1% 4.6% 5.4% 5.3% 4.8%

MaxPoint Interactive - - - - - - - - - - 88.4% - - - 61.1% 1.9% -1.4% -4.8% -8.3% -8.5%

Mecox Lane 0.4x 0.4x 0.6x 0.5x 0.8x - - - - 3.1x -42.4% -36.9% -36.6% -16.7% -43.3% -21.3% 32.2% -7.0% -12.6% 24.4%

Mercadolibre 8.6x 7.5x 9.2x 10.6x 9.8x 24.5x 21.2x 25.7x 29.1x 29.3x 26.5% 23.6% 21.4% 19.9% 17.8% 35.0% 35.4% 35.9% 36.3% 33.6%

Mitel Networks 2.0x 2.0x 1.6x 1.3x 1.1x 17.0x 17.4x 13.8x 11.9x 8.1x - - - - 106.0% 11.9% 11.6% 11.3% 10.9% 13.6%

MOL Global - - - 1.5x 0.8x - - - 6.7x - 79.5% - - - 18.2% 25.3% 24.7% 23.9% 22.5% -0.4%

Monster Worldwide 1.0x 0.9x 0.9x 0.7x 0.9x 7.3x 7.3x 7.9x 7.7x 10.3x -9.3% -8.6% -6.6% -4.6% -4.7% 13.9% 12.6% 10.9% 9.3% 8.9%

NCSoft 4.8x 4.3x 2.9x 3.0x 3.5x 14.9x 14.0x 9.7x 8.8x 9.5x 0.4% -5.9% -8.4% 0.0% 10.8% 31.8% 30.7% 30.1% 34.8% 37.3%

Netease 0.7x 0.7x 0.8x 0.9x 0.9x 1.4x 1.4x 1.7x 2.0x 2.1x 12.1% 12.2% 14.1% 18.0% 27.4% 49.1% 48.5% 47.0% 44.5% 42.2%

Netflix 5.4x 4.6x 5.4x 4.1x 4.7x 85.6x 61.5x 63.2x 44.9x 56.9x 21.2% 22.8% 24.0% 25.3% 25.8% 6.3% 7.4% 8.5% 9.1% 8.3%

Orbitz 1.4x 1.3x 1.3x 1.2x 1.7x 10.0x 8.7x 8.7x 8.5x 11.0x 8.8% 7.9% 7.3% 8.3% 10.0% 13.8% 14.9% 14.9% 14.0% 15.0%

Overstock.com 0.3x 0.2x 0.2x 0.3x 0.3x 9.7x 7.7x 16.9x 25.8x 15.6x 18.6% 16.1% 14.2% 14.1% 14.8% 2.8% 2.6% 1.3% 1.3% 1.7%

Pandora 9.8x 6.7x 6.4x 4.2x 3.2x - - - - - 54.1% - - - 40.6% -2.8% -1.0% -1.4% -1.0% -1.7%

Perfect World 0.2x 0.2x 0.2x 0.2x 0.2x 1.0x 0.7x 1.0x 1.1x 1.0x 10.2% 24.5% 30.9% 30.4% 25.9% 20.9% 20.5% 21.0% 18.3% 16.2%

PetMed Express 1.0x 1.0x 1.0x 1.0x 1.2x 7.7x 7.9x 8.1x 7.8x 9.0x 1.4% 2.4% -0.6% -2.8% -3.3% 12.4% 12.5% 12.7% 12.6% 12.9%

Polycom 1.1x 1.1x 1.1x 1.1x 1.1x 12.6x 11.1x 10.6x 9.5x 9.0x -1.7% -2.0% -2.0% -2.1% -1.7% 8.7% 9.7% 10.4% 11.5% 11.9%

Priceline 8.6x 8.2x 7.9x 6.9x 6.7x 22.7x 21.7x 20.7x 17.7x 17.2x 29.1% 29.1% 28.9% 26.4% 24.3% 37.8% 37.6% 38.2% 38.9% 38.9%

Qihoo 17.3x 13.0x 11.1x 7.1x 5.1x 56.9x 43.6x 41.9x 28.7x 20.6x 104.0% 123.6% 121.3% 113.8% 107.2% 30.5% 29.8% 26.6% 24.7% 24.8%

QuinStreet 0.9x 0.7x 0.6x 0.6x 0.8x 9.8x 10.0x 15.2x 61.0x - -9.5% -7.7% -7.4% -9.4% -7.6% 9.0% 7.3% 3.9% 0.9% -0.6%

ReachLocal 0.4x 0.2x 0.2x 0.1x 0.1x 18.9x 27.5x - - - 13.0% 9.4% 5.5% -0.4% -7.6% 2.3% 0.9% -1.5% -4.2% -7.0%

Renren 2.3x 1.7x 1.7x 2.7x 1.4x - - - - - -4.4% -17.1% -40.9% -46.4% -43.9% -54.5% -71.0% -81.4% -103.9% -108.3%

Rocket Fuel 7.5x 3.1x 1.3x 1.5x 1.2x - - - - - 125.7% 115.9% 97.4% 81.8% 69.8% -4.3% -4.8% -5.5% -8.3% -9.2%

Rovi 5.3x 5.4x 5.2x 4.9x 5.2x 15.6x 15.4x 14.9x 13.5x 15.1x 2.1% 11.9% 19.8% 32.2% 0.9% 33.9% 35.0% 35.1% 36.2% 34.3%

SeaChange International 1.8x 1.4x 1.1x 1.0x 1.2x 32.1x 931.3x - - - -6.9% -13.5% -18.6% -22.9% -21.1% 5.6% 0.1% -5.0% -10.1% -12.1%

ShoreTel 1.5x 1.1x 1.0x 1.2x 1.1x 46.2x 26.0x 18.6x 19.4x 16.3x 17.0% 9.9% 8.4% 7.2% 5.9% 3.1% 4.4% 5.6% 6.2% 6.7%

Shutterfly 2.1x 1.8x 2.2x 1.9x 1.8x 19.2x 18.0x 22.5x 22.2x 18.6x 22.3% 20.7% 18.4% 17.2% 17.6% 11.0% 9.8% 9.9% 8.6% 9.8%


SEG Internet Index



69

Company


Shutterstock 11.4x 8.9x 8.7x 7.6x 5.5x 57.4x 48.8x 53.4x 50.4x 38.5x 38.9% 40.4% 40.8% 40.7% 39.3% 20.0% 18.2% 16.4% 15.1% 14.2%

SINA 6.0x 3.6x 2.7x 1.7x 1.5x 68.9x 43.0x 29.3x 36.1x 136.4x 25.7% 29.4% 28.7% 24.2% 15.5% 8.7% 8.5% 9.3% 4.8% 1.1%

Sohu.com 1.7x 1.2x 1.2x 1.0x 1.1x 7.5x 9.2x 18.6x 73.4x 32.7x 31.2% 27.0% 23.4% 20.3% 19.5% 22.4% 13.4% 6.3% 1.4% 3.3%

Sonus Networks 2.3x 2.3x 2.7x 2.7x 2.7x 93.1x 145.2x 358.8x 347.6x - 12.3% 9.8% 7.2% 7.2% -3.0% 2.5% 1.6% 0.8% 0.8% -4.6%

Stamps.com 4.1x 3.5x 3.6x 5.1x 5.7x 14.4x 12.5x 13.0x 17.9x 21.6x 10.5% 8.0% 6.4% 9.8% 15.2% 28.7% 28.3% 27.7% 28.3% 26.2%

Synacor 0.3x 0.3x 0.3x 0.2x 0.4x 9.7x 24.4x - - - -8.3% -10.4% -9.4% -8.3% -4.7% 3.5% 1.2% -0.9% -2.3% -1.3%

Tencent Holdings 16.2x 14.9x 16.2x 14.4x 15.3x 47.5x 44.0x 45.7x 38.7x 39.4x 37.7% 36.6% 36.8% 34.7% 30.6% 34.0% 33.9% 35.4% 37.3% 39.0%

The Rubicon Project - 5.5x 3.1x 3.3x 4.0x - - - - - 46.9% - - 48.5% 49.5% 2.2% -3.1% -8.1% -9.1% -8.7%

TheStreet.com 0.8x 0.5x 0.4x 0.4x 0.3x - - - 76.2x - 7.4% 11.4% 11.7% 9.5% 12.1% -0.7% -0.5% -0.2% 0.5% -1.1%

Travelzoo 1.7x 1.4x 1.3x 0.9x 0.6x 10.3x 8.4x 7.9x 6.2x 5.6x 4.7% 1.5% -2.7% -6.2% -10.2% 16.9% 16.5% 16.2% 14.2% 11.2%

Tree.Com 2.0x 1.4x 1.5x 2.5x 2.7x 27.6x 21.3x 19.6x 33.7x 39.2x 79.8% 63.8% 38.3% 26.1% 20.2% 7.1% 6.7% 7.8% 7.5% 6.8%

Tremor 1.0x 0.9x 0.5x 0.3x 0.3x - - - - - 25.3% 25.9% 22.1% 20.2% 21.0% -5.5% -6.5% -9.5% -11.2% -10.4%

TripAdvisor 13.5x 12.5x 12.8x 9.1x 9.3x 40.9x 38.8x 41.5x 31.4x 31.0x 23.9% 23.0% 24.7% 29.9% 31.9% 32.9% 32.3% 31.0% 28.9% 30.1%

TubeMogul - - 3.2x 4.4x 3.7x - - - 219.5x - 67.5% - - 104.6% 99.7% -10.4% -6.5% -0.8% 2.0% -0.9%

Tucows 1.1x 1.1x 1.2x 1.2x 1.3x 16.4x 15.3x 14.9x 14.9x 15.0x 13.3% 14.7% 15.5% 12.2% 13.6% 6.6% 7.2% 8.0% 8.3% 9.0%

Twitter 44.3x 26.0x 26.1x 19.7x 19.7x - - - - - 109.8% 112.5% 117.3% 118.3% 111.0% -82.2% -78.8% -74.6% -68.0% -24.7%

VeriSign 7.3x 6.4x 6.8x 7.0x 7.2x 12.0x 10.5x 11.1x 11.3x 11.6x 10.5% 8.1% 6.3% 5.3% 4.7% 61.0% 61.0% 61.5% 61.6% 62.2%

WebMD Health 3.5x 3.3x 3.7x 2.9x 3.0x 24.5x 20.6x 20.4x 15.0x 15.4x 9.7% 12.8% 12.9% 12.4% 12.6% 14.3% 16.2% 18.0% 19.1% 19.5%

Wix.com 12.2x 6.2x 5.0x 5.3x 4.5x - - - - - 84.2% 88.5% 85.3% 81.9% 76.3% -31.8% -37.2% -40.0% -39.7% -37.4%

XO Group 1.8x 1.7x 1.7x 2.2x 2.5x 13.8x 14.3x 16.4x 21.1x 21.6x 3.6% 4.9% 4.7% 4.3% 7.4% 13.2% 11.7% 10.6% 10.2% 11.7%

Xoom 6.4x 4.8x 4.7x 2.9x 2.8x 69.0x 53.5x 72.5x 51.4x 44.6x 52.7% 53.1% 40.4% 31.2% 30.2% 9.3% 8.9% 6.5% 5.6% 6.2%

Xunlei - - 2.7x 0.8x 0.3x - - 13.6x 7.6x 1.5x 24.2% - - - 2.8% 26.9% 24.3% 19.8% 10.8% 17.7%

Yahoo! 7.8x 7.1x 7.7x 8.2x 7.6x 35.5x 37.5x 45.9x 52.5x 51.3x -6.1% -4.7% -4.2% -2.7% -1.3% 22.0% 19.0% 16.7% 15.6% 14.8%

Yandex 0.3x 0.2x 0.2x 0.2x 0.1x 0.7x 0.6x 0.6x 0.4x 0.3x 37.3% 37.2% 36.2% 33.0% 28.5% 40.7% 39.0% 37.8% 38.6% 39.0%

Yelp 24.1x 16.1x 16.9x 11.4x 8.4x 6200.4x 3102.6x 775.4x 263.7x 129.0x 69.4% 68.4% 66.2% 66.2% 62.0% 0.4% 0.5% 2.2% 4.3% 6.5%

Youku 1.5x 1.1x 1.0x 0.6x 0.5x 12.0x 9.5x 9.0x 5.7x 3.8x 60.7% 57.4% 42.0% 32.7% 37.6% 12.5% 11.7% 11.0% 10.6% 12.2%

YuMe 1.1x 0.9x 0.7x 0.6x 0.7x 39.3x 55.0x 93.7x - - 29.5% 31.2% 26.8% 22.6% 17.6% 2.9% 1.6% 0.8% -0.5% -2.6%

YY 1.9x 1.5x 1.6x 1.2x 0.9x 6.6x 4.9x 4.9x 3.8x 2.7x 122.4% 117.8% 113.7% 111.1% 101.7% 28.8% 30.8% 31.9% 32.0% 31.5%

Zillow 15.1x 17.5x 19.7x 13.8x 12.1x - - - - - 69.1% 69.1% 68.6% 68.2% 65.0% -2.8% -2.9% -1.9% -0.3% -0.8%


SEG Internet Index


THE SEG INTERNET INDEX METRICS BY PRODUCT CATEGORY

70

Ad Tech 1Q14 2Q14 3Q14 4Q14 1Q15


EV/EBITDA 18.3x 21.8x 18.6x 15.8x 12.9x



EBITDA Margin 4.1% 4.6% 5.4% 2.0% 3.3%

Net Income Margin 0.2% -0.9% -1.7% -3.0% -4.9%


TTM EBITDA Growth (YoY) 5.9% 0.4% -4.5% -30.1% -33.8%


Current Ratio 2.9 2.5 3.4 2.4 2.1



Commerce 1Q14 2Q14 3Q14 4Q14 1Q15


EV/EBITDA 15.9x 15.7x 17.4x 17.9x 14.5x



EBITDA Margin 10.8% 8.8% 6.3% 10.1% 7.8%




TTM Earnings Growth (YoY) 14.5% 27.1% 7.9% 0.0% -8.1%

Current Ratio 1.7 1.5 1.7 1.6 1.7



Content & Media 1Q14 2Q14 3Q14 4Q14 1Q15


EV/EBITDA 19.1x 17.5x 16.4x 18.1x 15.4x



EBITDA Margin 14.3% 11.7% 11.0% 10.6% 12.2%




TTM Earnings Growth (YoY) 4.3% -22.2% -16.4% 10.7% 45.2%

Current Ratio 2.6 3.2 3.4 3.5 2.7



Gaming 1Q14 2Q14 3Q14 4Q14 1Q15


EV/EBITDA 7.5x 9.2x 9.6x 20.3x 14.1x



EBITDA Margin 27.1% 25.1% 18.8% 11.8% 13.1%



TTM EBITDA Growth (YoY) -14.8% -24.7% -19.6% 5.4% -15.2%


Current Ratio 1.9 2.0 1.8 2.5 2.5



Infrastructure 1Q14 2Q14 3Q14 4Q14 1Q15


EV/EBITDA 17.2x 20.8x 17.8x 18.0x 15.7x



EBITDA Margin 6.1% 5.0% 3.9% 4.1% 6.0%





Current Ratio 2.7 2.4 2.4 2.3 2.3



Search 1Q14 2Q14 3Q14 4Q14 1Q15


EV/EBITDA 7.4x 7.2x 7.8x 8.0x 7.7x



EBITDA Margin 37.8% 36.7% 33.8% 32.8% 33.4%





Current Ratio 4.2 4.2 4.1 3.2 3.5


Enterprise Value Growth (YoY) 64.8% 34.4% 34.1% 10.8% -8.5%

Services 1Q14 2Q14 3Q14 4Q14 1Q15


EV/EBITDA 27.6x 24.2x 26.4x 28.7x 24.6x



EBITDA Margin 7.8% 7.5% 6.9% 7.3% 6.5%





Current Ratio 2.1 2.7 2.6 2.7 2.6



Social 1Q14 2Q14 3Q14 4Q14 1Q15

EV/Revenue 14.6x 10.5x 12.6x 11.4x 8.4x

EV/EBITDA 38.8x 31.2x 33.2x 32.6x 32.7x



EBITDA Margin 10.9% 9.9% 10.6% 11.2% 10.5%





Current Ratio 9.7 9.6 6.7 9.4 9.6


Enterprise Value Growth (YoY) n/a n/a n/a -9.9% -14.3%

Travel 1Q14 2Q14 3Q14 4Q14 1Q15


EV/EBITDA 14.9x 14.3x 14.2x 13.3x 17.2x



EBITDA Margin 17.0% 15.6% 15.6% 14.3% 13.8%





Current Ratio 1.8 1.8 1.7 1.7 1.7




Select PUBLIC SELLERS

71

Date Buyer Seller Purchase Price

(mm) Enterprise Value

(mm) EV/Rev EV/EBITDA TTM Rev Growth

02/02/15 SS&C Technologies Holdings, Inc. (NasdaqGS:SSNC) Advent Software, Inc. (NasdaqGS:ADVS) $2,585.7 $2,549.6 6.4x 24.8x 3.6%

03/24/15 Lexmark International Technology S.A. Kofax Limited (NasdaqGS:KFX) $1,014.3 $954.9 3.2x 43.0x 5.7%

03/02/15 Mitel U.S. Holdings, Inc. Mavenir Systems, Inc. (NYSE:MVNR) $546.6 $491.9 3.8x - 28.1%

02/04/15 Insight Venture Partners E2open, Inc. $274.1 $249.9 3.2x - 13.0%

01/28/15 S. Carter Enterprises, LLC Aspiro AB (OM:ASP) $56.3 $48.6 1.3x - 21.5%


Select MEGA DEALS

72

Date Buyer Seller Purchase Price


(mm) EV/Rev EV/EBITDA TTM Rev Growth

02/02/15 SS&C Technologies Holdings, Inc. (NasdaqGS:SSNC) Advent Software, Inc. (NasdaqGS:ADVS) $2,585.7 $2,549.6 6.4x 24.8x 3.6%

03/30/15 DH Corporation (TSX:DH) Fundtech Ltd. $1,250.0 $1,250.0 4.8x 21.0x 15.0%

03/24/15 Lexmark International Technology S.A. Kofax Limited (NasdaqGS:KFX) $1,014.3 $954.9 3.2x 43.0x 5.7%

01/22/15 Harman International Industries, Inc. (NYSE:HAR) Symphony Teleca Corp. $780.0 $780.0 2.1x 13.0x -

01/14/15 Zayo Group, LLC Latisys Holdings, LLC $675.0 $675.0 - - -

03/26/15 Rongxin Power Electronic Co.,Ltd. (SZSE:002123) Montnets Technology Co., Ltd. $525.3 $525.3 - - -

03/02/15 Mitel U.S. Holdings, Inc. Mavenir Systems, Inc. (NYSE:MVNR) $546.6 $491.9 3.8x - 28.1%


MOST ACTIVE BUYERS

73

Buyer Seller Purchase Price


(mm) TTM Rev

(mm) EV/Revenue

Bentley Systems, Incorporated C3 Global Ltd - - - -

Acute3D SAS - - - -

EADOC, LLC - - - -

Dalian Kemian Wood Industry Co., Ltd. Beijing Miaoqu Hengsheng Technology Co $94.9 $99.9 - -

RaySns Technology Co., Ltd. $141.6 $141.6 - -

Avazu Inc. $333.6 $333.6 - -

Dentsu Aegis Network Ltd. WATMedia Pvt Ltd - - - -

Soap Linked by Isobar - - - -

Isobar-iProspect Advertising Services S.A. - - - -

Facebook, Inc. (NasdaqGS:FB) Wit.AI, Inc. - - - -

Quickfire Networks Corporation - - - -

TheFind, Inc. - - - -

Google Inc. (NasdaqGS:GOOGL) Red Hot Labs, Inc. - - - -

Nimbuz, Inc. - - - -

Launchpad Toys Inc. - - - -

Intuit Inc. (NasdaqGS:INTU) Porticor Ltd. $10.0 $10.0 - -

Zeropaper Serviços de Informática S.A. - - - -

Playbook Labs, Inc. - - - -

Microsoft Corporation (NasdaqGS:MSFT) Revolution Analytics, Inc. - - - -

LiveLoop, Inc. - - - -

Equivio Ltd. - - - -

Sunrise Atelier, Inc. - - - -


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Software Equity Group is an investment bank and M&A advisory serving the software and technology sectors. For a confidential consultation without [email protected] , 2800-509) 858Beible, Director, Business Development (Kris obligation, please contact

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Software Equity Group, L.L.C. 12220 El Camino Real, Suite 320 San Diego, CA 92130 www.softwareequity.com p: (858) 509-2800 The information contained in this Report is obtained from sources we believe to be reliable, but no representation or guarantee is made about the accuracy or completeness of such information, or the opinions expressed herein. Nothing in this Report is intended to be a recommendation of a specific security or company or intended to constitute an offer to buy or sell, or the solicitation of an offer to buy or sell, any security. Software Equity Group LLC may have an interest in one or more of the securities or companies discussed herein. Financial data provided by Capital IQ. This Report may not be reproduced in whole or in part without the expressed prior written authorization of Software Equity Group, L.L.C. Software Equity Group registers each Report with the U.S. Copyright Office and vigorously enforces its intellectual property rights.

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