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1、European SaaSreport2024This report is intended for professional investors only;see the back of the report for important disclosures.GP Bullhound Corporate Finance Ltd and GP Bullhound Asset Management Limited are authorised and regulated by the Financial Conduct Authority.GP Bullhound Inc is a membe

2、r of FINRA.GP Bullhound Luxembourg S.r.l.is regulated by the CSSF in Luxembourg.December 2024In partnership with22024 EUROPEAN SAAS SURVEYOur third annual European SaaS report offers reasons for optimism as the sector navigatesevolving market dynamics.Conducted in partnership with Paddle,the survey

3、encompassesover 100 European SaaS companies,ranging from early-stage ventures to late-stage growth.Last years report highlighted the sectors focus on cash preservation and profitability amidst achallenging macroeconomic landscape,characterized by a slowdown in growth and fundraisingactivity.This yea

4、rs survey reveals promising progress across the European SaaS sector,withcompaniescontinuingtoimprovegrossmargins,operationalefficiency,andoverallprofitability.Nearly half of the surveyed companies are now EBITDA positive,underscoring asustained commitment to capital-efficient growth.Despite subdued

5、 fundraising volumes,the increase in larger private placements and growingM&A activity demonstrate the sectors adaptability and resilience.With public SaaS valuationsnow above the three-year average and a renewed focus on profitable growth,the industry iswell-positioned to benefit from an improving

6、macroeconomic environment in 2025.ALEXIS SCORER,PARTNER AT GP BULLHOUNDThe view from GP BullhoundSource:GP Bullhound Insights 32024 EUROPEAN SAAS SURVEYKey takeawaysFOREWORDGP Bullhound European SaaS surveyGP Bullhound European SaaS surveyPublic market European SaaSPublic market European SaaSContinu

7、ed improvement in operational efficiencyContinued improvement in operational efficiencyARR per FTE is approaching 150k for growth stage companies and remains significantly above 2021 levels for 50m+ARR companies despite a slight reduction from last yearGrowing emphasis on profitable growth Growing e

8、mphasis on profitable growth Correlation between public market valuations for our European SaaS index and Rule of 40 performance has increased significantly with a renewed emphasis on growth versus last yearGrowth rates remain stable for lateGrowth rates remain stable for late-stage SaaSstage SaaSDe

9、spite a slight overall decrease in growth in 2023 across the cohort surveyed,growth rates for 50m+ARR companies are broadly in line with the previous yearPublic SaaS valuations now above the 3Public SaaS valuations now above the 3-year meanyear meanAverage European SaaS valuations trading at 6.7x,ab

10、ove the 3-year average of 5.4x Stable yearStable year-onon-year Net Revenue Retention of 110%year Net Revenue Retention of 110%Median Net Revenue Retention was 110%-112%in 2023 for companies surveyed,nearly identical to rates these companies exhibited in 2022Renewed divergence in US vs EU SaaS valua

11、tionsRenewed divergence in US vs EU SaaS valuationsFollowing a recent period of convergence between public US and European SaaS valuations,listed US SaaS companies are now valued at a 20%40%premium over their European counterpartsBroad improvements in Gross Margin yearBroad improvements in Gross Mar

12、gin year-onon-yearyearAll ARR cohort groups saw improvements in gross margin ranging from 1%-7%,reversing the trend highlighted in last years surveyResilient M&A volume in 2024 YTDResilient M&A volume in 2024 YTDStrong M&A activity in YTD period signals early stages of recovery following several qua

13、rters of consecutive growthNearly half of all SaaS companies surveyed are now Nearly half of all SaaS companies surveyed are now profitableprofitableContinued improvements in profitability,with 44%of all companies now EBITDA positive compared with c.33%in last years reportGrowing proportion of large

14、r lateGrowing proportion of larger late-stage fundraisingsstage fundraisingsWhilst fundraising activity remains muted,deal value has begun to recover with a notable increase in the proportion$250m+transactions in 2024 YTD European SaaS deal activityEuropean SaaS deal activitySource:GP Bullhound Insi

15、ghts 4GP Bullhound European SaaS survey5GP BULLHOUND EUROPEAN SAAS SURVEYDatasetoverviewRevenueanalysisCustomer acquisition and retention benchmarksOperationalefficiency analysis6GP BULLHOUND EUROPEAN SAAS SURVEY10%12%25%46%8%20 FTE20-50 FTE50-100 FTE100-500 FTE500 FTE+13%32%8%9%8%16%16%Sales and ma

16、rketingVertical SaaSCollaboration andworkflowInfrastructure andsecurityHR/ERPData and analyticsOther28%56%7%8%5m5-25m25-100%due to rounding 7GP BULLHOUND EUROPEAN SAAS SURVEYDatasetoverviewRevenueanalysisCustomer acquisition and retention benchmarksOperationalefficiency analysis8GP BULLHOUND EUROPEA

17、N SAAS SURVEYMost companies demonstrated 2-year growth ratesof c.35%-40%,regardless of ARR recognised in theyear-ended Dec-23.The range of datapoints widens significantly in the25m ARR cohort,highlighting variability acrossgrowth stage companies.For companies in the25m50m ARR range,growth stabilises

18、 with atighter range and an improvement in median growthrates.The 50m+ARR cohort also demonstrated highervariability.Despite a median ARR CAGR of c.42%,this late-stage growth cohort displayed the highestinterquartile range(14%to 50%).Despite this,the median 2-year CAGR remainsbroadly similar across

19、all cohorts,perhaps due toimprovedeconomicstability,higherinvestorconfidence,and favourable conditions such as lowerinterest rates during the period.2-year ARR CAGR clusters around 35-45%among European SaaS companies surveyedARR ANALYSISARR CY21/23 CAGR(%)/ARR(m)DecDec-23 ARR23 ARR ARR CAGR(%)(21/23

20、)ARR CAGR(%)(21/23)MinMinMaxMaxMedianMedian75th percentile75th percentile25th percentile25th percentileData covers calendar years 2021 and 2023Source:GP Bullhound Insights 35%40%42%9GP BULLHOUND EUROPEAN SAAS SURVEYAcross the European SaaS ecosystem,overall year-on-year growth experienced a slight d

21、ecrease in2023.Growth stage companies surveyed between 25m to50m ARR saw the largest reduction in growth overthe period,decreasing from a median of 43%to 27%in 2023.Growth rate for the 50m+ARR cohort is broadly inlinewiththepreviousyear.However,thisisimpressivegiventhiscohortdemonstratedadoubling of

22、 ARR per FTE in 2022(discussed furtheron the next page).Growth rates remain stable for late-stage SaaS,despite a slight decrease in growth across the cohort in 2023ARR ANALYSISARR YoY Growth(%)/ARR(m)MinMinMaxMaxMedianMedian75th percentile75th percentile25th percentile25th percentile 25m ARR50m+ARR

23、Data covers calendar years 2022 and 2023Source:GP Bullhound Insights 25m 50m ARR37%31%43%27%43%42%10GP BULLHOUND EUROPEAN SAAS SURVEYContinued improvement in headcount efficiency across a broad range of companies(5m-50m)AVERAGE ARR PER FTE ANALYSISAverage ARR per FTE(000)7595124142811141262795914314

24、52275m5-25m25-50m50m+2022 European SaaS Report2023 European SaaS Report2024 European SaaS ReportDecDec-23 ARR23 ARRData covers calendar years 2021,2022,and 2023For businesses with an ARR between 5m50m,headcount efficiency generally improved,with both the5m25m and 25m50m cohorts showcasinggains.This

25、highlights that as businesses scale,thehiring focus shifts from R&D to roles more directly tiedto ARR generation.It is important to note that thisyears surveys composition differs slightly from prioryears,which may influence like-for-like comparisons.Conversely,mature SaaS companies(50m+ARR)sawa con

26、traction in ARR per FTE from 279k to 227k,indicating that larger firms are beginning to experiencethe limits of workforce optimisation and/or scalingchallenges.However,this remains significantly above2021 levels without impeding growth.Similarly,start-ups(5m ARR)displayed a reductionin average ARR p

27、er FTE,which may be attributed to thelageffectsofthepreviousyearschallengingfundraising environment.Source:GP Bullhound Insights 11GP BULLHOUND EUROPEAN SAAS SURVEYDatasetoverviewRevenueanalysisCustomer acquisition and retention benchmarksOperationalefficiency analysis12GP BULLHOUND EUROPEAN SAAS SU

28、RVEYEnterprise customers typically generate an ARR per customer which is 14x that of SME customersARR per customer by target customer group(000)Data covers calendar year 2023Average CAC by target customer group(000)Data covers calendar year 2023ARR ANALYSIS12.131.4179.8SMESME andEnterpriseEnterprise

29、11.028.373.9SMESME andEnterpriseEnterpriseThe average ARR per customer for Enterprise-focused SaaS companies surveyed is 180k,which isover 14x higher than those focused on SMEs at 12k.This trend is also reflected in(CAC),with Enterprise-focusedSaaScompaniesspending74kperacquired customer compared to

30、 11k for SME-focused companies.SaaS companies that target bothcustomersegmentsdemonstrateanARRpercustomerof31k,closertoSME-focusedbusinesses.Additionally,sector segmentation plays a role inthese dynamics.50%of SME respondents operate inVertical SaaS,a sector characterized by tailoredofferings and sh

31、orter sales cycles,contributing to therelatively low CAC and ARR per customer in thissegment.Source:GP Bullhound Insights 13GP BULLHOUND EUROPEAN SAAS SURVEYSaaS companies surveyed focused on both Enterprise and SME customers enjoy higher LTV/CAC ratiosCAC ANALYSISAverage LTV/CAC by target customer

32、groupData covers calendar year 2023Average LTV/CAC by product offering categoryData covers calendar year 2023European SaaS companies serving both SME andEnterprise-gradecustomershaveanaverageLTV/CAC of 9.8x,significantly higher than thosefocused exclusively on one customer group.SME-focused SaaS com

33、panies have an average LTV/CACof6.3x,whileEnterpriseSaaScompaniesdemonstrate a slightly lower ratio of 4.8x.SaaScompanieswithindustry-specificsoftwareachieve the highest LTV/CAC at 8.9x,reflecting thestickiness and integration of these tools in dailyoperations.In contrast,SaaS companies in theInfras

34、tructure&Security sector report the lowestLTV/CAC at 3.0 x,driven by higher acquisition costsand longer sales cycles in this domain.This trend isconsistent with last years report,but notably,mostsectors exhibited a decrease in LTV/CAC ratioscompared to the previous year.8.9x6.5x5.3x4.9x4.2x3.0 x9.4x

35、Industry-specificsoftwareCollaborationand workflowData andanalyticsHR/ERPSales andmarketingInfrastructureand securityOther6.3x4.8x9.8xSMEEnterpriseSME andEnterpriseSource:GP Bullhound Insights 14GP BULLHOUND EUROPEAN SAAS SURVEYContract durations above 1 years require higher CAC but demonstrate high

36、er ARRAverage CAC by contract duration(000)Data covers calendar year 2023CAC ANALYSIS1.536.146.21 year1 year2 years+Average ARR by contract duration(000)Data covers calendar year 202324.333.427.01 year1 year2 years+Contracts with a duration of 2 years+show thehighest CAC(46k)and mid-range ARR(27k),p

37、otentially reflecting discounted pricing strategies orlimitedadoptionoflong-termagreementstoEuropean SaaS companies.Contracts of less than 1 year duration demonstrate alow CAC(1.5k)but achieve a relatively strong ARR(24k),suggesting efficiency in acquiring short-termcustomers with lower upfront inve

38、stment.1-year contracts achieve the greatest ARR(33k),while only requiring modest CAC investment of(36k).Source:GP Bullhound Insights 15GP BULLHOUND EUROPEAN SAAS SURVEYMost European SaaS companies have a payback period of 13 18 monthsAverage payback period by target customer group(months)Data cover

39、s calendar year 2023Enterprise-focused SaaS companies surveyed havethe longest payback period of 18.5 months,asexpected given the nature of this segment.Incontrast,SME-focusedSaaScompaniesandcompanies targeting both SMEs and Enterprisesdemonstrateshorterpaybackperiodsat13.3months and 13.1 months,res

40、pectively,driven byquicker sales cycles and lower CAC.The later-stage SaaS companies(50m+ARR)arethe most efficient,achieving a payback period of just8.3 months,benefiting from operational scale andcustomer retention strategies.In comparison,mid-sizedcompanies(525m)typicallyhavethelongest payback per

41、iod of those surveyed at 19.3months.Average payback period by product offering category(months)Data covers calendar year 2023PAYBACK PERIOD ANALYSIS13.318.513.1SMEEnterpriseSME andEnterprise12.519.311.78.35m5-25m25-50m50m+Source:GP Bullhound Insights 16GP BULLHOUND EUROPEAN SAAS SURVEYFY22FY23SMEs a

42、nd Enterprise focused companied experienced a slight 1%decline in Gross Revenue Retention(GRR)YoY,while SME-focused companies saw a marginal 1%improvement,but remained below the 90%mark.Enterprise-focused companies,however,held steady with a consistent 90%GRR.Gross Revenue Retention rates remained s

43、table between 2022 and 2023RETENTION ANALYSISGross Revenue Retention(%)SME-focused CY22 vs CY23FY22FY2345%50%55%60%65%70%75%80%85%90%95%100%FY22FY23Represents 75thand 25thpercentile of respondent distributionMedian72%73%Gross Revenue Retention(%)Enterprise-focused CY22 vs CY23Gross Revenue Retention

44、(%)SME&Enterprise-focused CY22 vs CY23Source:GP Bullhound Insights 91%90%90%90%90%90%17GP BULLHOUND EUROPEAN SAAS SURVEYFY22FY23Net Revenue Retention(NRR)trends in Europe indicate that SMEs held steady at 110%,whilst surveyed enterprise-focused companies saw a 2%decline,and companies targeting SMEs

45、and enterprises saw a 4%improvement.The slight drop in median Enterprise NRR highlights ongoing challenges in maintaining large-scale contracts,despite the overall improvement of the 25thpercentile across all these segments.The range of Net Revenue Retention rates widened in 2023 across all categori

46、es of European SaaS surveyedRETENTION ANALYSISNet Revenue Retention(%)SME-focused CY22 vs CY23FY22FY2390%95%100%105%110%115%120%125%130%135%FY22FY23100%100%110%110%112%110%108%112%Net Revenue Retention(%)Enterprise-focused CY22 vs CY23Net Revenue Retention(%)SME&Enterprise-focused CY22 vs CY23Source

47、:GP Bullhound Insights Represents 75thand 25thpercentile of respondent distributionMedian18GP BULLHOUND EUROPEAN SAAS SURVEYDatasetoverviewRevenueanalysisCustomer acquisition and retention benchmarksOperationalefficiency analysis19GP BULLHOUND EUROPEAN SAAS SURVEY75%79%80%80%70%74%77%74%77%76%77%80%

48、5m5-25m25-50m50m+2022 European SaaS Report2023 European SaaS Report2024 European SaaS ReportMedian gross margins have increased across all cohorts surveyed with late-stage growth companies returning to historical levelsOPERATIONAL EFFICIENCY ANALYSISGross margin(%)/ARR(m)Data covers calendar years 2

49、021,2022,and 2023For SaaS companies,direct costs include but are notlimited to:Hosting costsCustomer support/customer success costsThird-party licenses utilised in the softwaresapplicationOverall,in the past year there has been steadyimprovements in gross margin percentages acrossmost respondents,br

50、idging the gap to 2022 grossmargins as companies begin to pass on the impactsof inflation,their pricing models evolve,and longer-term,and contracts are renewed.The 2550m segment remained stable at 77%,maintaining high efficiency,and the 50m+cohortsaw an impressive jump from 74%to 80%.Source:GP Bullh

51、ound Insights DecDec-23 ARR23 ARR20GP BULLHOUND EUROPEAN SAAS SURVEY73%27%33%67%36%64%29%71%The growing focus on profitability continues with 44%of companies surveyed profitable in 2023EBITDA MARGIN ANALYSISProportion of profitable companies(%)by 22/23 ARR growthIn 2023,73%of companies with growth o

52、f 20%orless were profitable compared to 40%for theequivalent cohort last year.As one would expect,as growth rates increase,theproportion of profitable companies decreases,withother growth segments(20-40%,40-60%,60%+)maintaining a much lower proportion of profitablecompanies(c.30%).This indicates tha

53、t growthrates were not a strong profitability indicator forSaaS companies in 2023.Data covers calendar year 202320%ARR growthARR growth20%-40%ARR growthARR growth40%-60%ARR growthARR growth60%+ARR growthARR growthProfitableProfitableUnprofitableUnprofitableSource:GP Bullhound Insights 21GP BULLHOUND

54、 EUROPEAN SAAS SURVEYSurveyed data indicates that total costs account for 70%to90%of revenue for European SaaS companies of all sizes.Costs are lowest for companies with 5m to 25m ARR,asthey are often in the pre-scaling phase for their Sales&Marketing functions.Our data shows that Research&Developme

55、nt costs declinesignificantly as ARR increases,with a particularly sharp droponce ARR surpasses 25m.At this stage,companies shift focus,increasing Sales&Marketing spend as a proportion of revenue,prioritising areasthat directly drive ARR growth.We note,that this proportionwas greater in this years r

56、eport for companies above 5mARR.In contrast to last years report,General&Administrativecosts remain steady at around 21-22%across all ARRranges,reflecting consistency regardless of scale.R&D expense as a proportion of revenue declines steadily as SaaS businesses scale,shifting focus to Sales&Marketi

57、ng,which peaks at 46%OPERATIONAL EFFICIENCY ANALYSISCost build up(%)as a function of revenue(m)Data covers calendar year 202323%30%46%38%27%22%22%21%21%5m5-25m25m+Sales&MarketingResearch&DevelopmentGeneral&AdministrativeDecDec-23 ARR23 ARRSource:GP Bullhound Insights 22European SaaS public market up

58、date23EUROPEAN SAAS PUBLIC MARKET UPDATENov-21Feb-22May-22Aug-22Nov-22Feb-23May-23Aug-23Nov-23Feb-24May-24Aug-24Nov-24European SaaS-TEV/Forward Total RevenueUS SaaS-TEV/Forward Total RevenueEuropean SaaS-TEV/Forward Total Revenue AvgUS SaaS-TEV/Forward Total Revenue Avg7.5x5.4x9.5x6.7xAfter a period

59、 of relative stability,the gap between US and European SaaS valuations has widened in recent monthsSources:GP Bullhound Insights and Capital IQ(22 November 2024)PUBLIC EUROPEAN SAAS MARKETThe valuation gap between US and European SaaS companies narrowed over the past three years.The premium on US Sa

60、aS stocks compared to European ones hasdecreased from 132%in Nov-21 to just 8%by Aug-24.However,recent improvement in valuations in the US has driven a growing divergence multiples,with USSaaS companies now valued at a 20%40%premium over their European counterparts.While both US and European SaaS co

61、mpanies have similar EBITDA margins(18%for US and 25%for Europe),US companies have generated significantly higherrevenue growth than their European peers8.8x0.4x2.8xAverage CY24E EBITDA marginAverage CY24E revenue growth18%25%14%5%24EUROPEAN SAAS PUBLIC MARKET UPDATER=0.6698-10.0%20.0%30.0%40.0%50.0

62、%60.0%70.0%80.0%90.0%-5.0 x10.0 x15.0 x20.0 xR=0.3909-10.0%20.0%30.0%40.0%50.0%60.0%70.0%80.0%90.0%-5.0 x10.0 x15.0 x20.0 xPublic market investors appear to be placing increasing emphasis on the Rule of 40 as evidenced by a material increase in correlation versus last yearSources:GP Bullhound Insigh

63、ts and Capital IQ(22 November 2024)Note:“Rule of 40”NTM FCF margin+NTM revenue growthThe correlation between public market valuations for our European SaaS index and Rule of 40 performance has increased by 71%over the past year,reflecting a growing emphasis on disciplined investment in European SaaS

64、 companies.GPB European SaaS Index:NTM Rule of 40 vs.EV/NTM RevenueData as at Oct-23GPB European SaaS Index:NTM Rule of 40 vs.EV/NTM RevenueData as at Oct-24PUBLIC EUROPEAN SAAS MARKETMedian NTM EV/Revenue3.0 x3.0 xMedian NTM EV/Revenue7.7x7.7xMedian NTM EV/Revenue2.6x2.6xMedian NTM EV/Revenue7.4x7.

65、4x25EUROPEAN SAAS PUBLIC MARKET UPDATER=0.5254(10.0)%-10.0%20.0%30.0%40.0%50.0%60.0%70.0%-5.0 x10.0 x15.0 x20.0 xR=0.487(10.0)%-10.0%20.0%30.0%40.0%50.0%60.0%70.0%-5.0 x10.0 x15.0 x20.0 xShift in correlations versus last year highlight the renewed investor focus on profitable growthSources:GP Bullho

66、und Insights and Capital IQ(22 November 2024)As of Nov-24,the correlation between profitability and revenue multiples has slightly declined year-over-year but remains a key factor in valuations.The shiftreflects a growing emphasis on growth,with companies demonstrating strong growth metrics alongsid

67、e profitability achieving the highest valuationsGPB European SaaS Index NTM EBITDA margins vs.EV/NTM RevenueData as at Oct-23GPB European SaaS Index NTM EBITDA margins vs.EV/NTM RevenueData as at Oct-24PUBLIC EUROPEAN SAAS MARKET26EUROPEAN SAAS PUBLIC MARKET UPDATE(40.0)%(30.0)%(20.0)%(10.0)%0.0%10.

68、0%20.0%30.0%40.0%50.0%60.0%(20.0)%(10.0)%0.0%10.0%20.0%30.0%40.0%50.0%Consensus CY23 EBITDA marginConsensus CY23 Revenue growthHigh profitability,low growthHigh profitability,low growth42.9%of peers42.9%of peersLow profitability,low growthLow profitability,low growth42.9%of peers42.9%of peersLow pro

69、fitability,high growthLow profitability,high growth3.6%of peers3.6%of peersHigh profitability,high growthHigh profitability,high growth10.7%of peers10.7%of peersMost public European SaaS businesses in our index were profitable in 2023,but fewer achieved strong margins compared to last yearSources:GP

70、 Bullhound Insights and Capital IQ(22 November 2024)2023 saw a renewed focus on growth,with only around 55%of companies in our index achieving EBITDA margins above 20%(down from 65%last year)and 18%reporting negative EBITDA margins(up from less than 5%last year).Revenue growth(%)vs EBITDA margin(%)f

71、or GP Bullhounds European SaaS indexData covers calendar year 2023PUBLIC EUROPEAN SAAS MARKET27EUROPEAN SAAS PUBLIC MARKET UPDATEAverage EBITDA margins across European SaaS listed peers is around 16%Sources:GP Bullhound Insights and Capital IQ(22 November 2024)In 2023,average EBITDA margins within o

72、ur index held steady at 16%,compared to 15%in 2022.It is worth noting that EBITDA margins also reflectdifferences in operational/accounting dynamics.For instance,Admicom,with a mid-range gross margin,recorded the highest EBITDA margin(48%),supported by significant D&A adjustments.In contrast,Eagle E

73、ye,despite leading in gross margin,posted a comparatively low EBITDA margin(8%)asoperating expenses exceeded gross profit,and D&A adjustments resulted in only modest positive EBITDA margin.It should also be noted that Eagle Eyesreports adjusted EBITDA margin of 20%,further highlighting the variation

74、s between SaaS business models when other adjustments are factored in.EBITDA Margin of GP Bullhound European SaaS indexData covers calendar year 2023PUBLIC EUROPEAN SAAS MARKET48%43%39%32%32%31%30%27%26%25%23%22%22%21%20%19%18%13%11%8%7%6%2%(1)%(2)%(21)%(25)%(31)%AdmicomFortnoxSmartCraftQt GroupTeam

75、ViewerVitec SoftwareWolters KluwerLemonsoftNemetschekDassault SystmesSAPTemenosSageLime TechnologiesCheckin.ComIDOXdotdigitalBeta SystemsEskerEagle EyeAddnode GroupActiveOpsPexipSSHCint GroupExasolPenneoMotorKAverage:c.16%Average:c.16%28EUROPEAN SAAS PUBLIC MARKET UPDATEBenchmarking publicly listed

76、European SaaS companiesPUBLIC EUROPEAN SAAS MARKETPublic SaaS companies experienced moderate revenue growth of between 5%15%,a drop in range compared to CY22,which reported growth of 15%-25%26%CY22/23 Revenue growth15%10%3%(12)%The number of profitable SaaS companies in our index has remained unchan

77、ged,but the average EBITDA margin has increased to 16%in CY23 from 13%in CY22CY23 EBITDA Margin%48%30%21%6%(25)%Only 7%of our public European SaaS companies are above the 40%EBITDA margin+Revenue Growth threshold for premium valuationsCY22/23Rule of 4053%43%25%5%(9)%SaaS benchmarkingData covers cale

78、ndar year 202329European SaaS deal activity30EUROPEAN SAAS DEAL ACTIVITYSaaS M&A volume remains resilient following several quarters of consecutive growthEUROPEAN SAAS M&A DEAL ACTIVITYEuropean SaaS M&A deal volume11596118149200168207212219217184169176183204185203208208Q1-20Q2-20Q3-20Q4-20Q1-21Q2-21

79、Q3-21Q4-21Q1-22Q2-22Q3-22Q4-22Q1-23Q2-23Q3-23Q4-23Q1-24Q2-24Q3-24European SaaS M&A disclosed deal value2021:787 deals2022:789 deals2023:748 dealsYTD-24*:619 deals2021$32.8bn2022$40.6bn2023$19.3bnYTD-24*$18.6bn$1.4$1.6$30.0$3.4$4.9$16.4$5.5$6.0$9.8$11.1$15.2$4.5$2.1$6.9$7.4$2.9$5.1$9.8$3.7Q1-20Q2-20Q

80、3-20Q4-20Q1-21Q2-21Q3-21Q4-21Q1-22Q2-22Q3-22Q4-22Q1-23Q2-23Q3-23Q4-23Q1-24Q2-24Q3-24(#)($bn)M&ASources:GP Bullhound Insights and Pitchbook(Q1 2020 Q3 2024)Note:*YTD represents 1 January30 September 20242020:478 deals2020$9.5bnMean:180 Mean:$8.2bn Quarterly deal volume is growing following a declinei

81、n Q4 2023;Q1-24 and Q2-24 increased whilst Q3-24(a historically lower-volume quarter)was slightlyup on deals compared to Q3-23.Notably,all quartersthus far in 2024 have remained well above the long-term average of 180 deals.Total disclosed deal value in 2024 YTD($18.6bn)surpassed the equivalent peri

82、od in 2023($16.4bn).This was driven in-part by several larger-value deals,including:Thoma Bravos acquisition of Darktrace for$5.3bnApaxs acquisition of Zellis for 1.3bnBridgepoints acquisition of Lumapps for 650m31EUROPEAN SAAS DEAL ACTIVITYIn YTD 2024,the UK has remained the mostactivemarketforEuro

83、peanSaaSM&Atransactions and its share of overall Europeandeal volume has increased to 25%(in our lastreport,the UK represented 23%of total activity)Overall,European deal volume across Q1-Q32024 has increased by 10%compared with thesame period in the prior year,driven by changes inthe top two markets

84、United Kingdom(28%increase)Germany(5%increase)Of the top five European markets,only Swedenand the Netherlands experienced falls in dealactivity year-over-yearUK,Germany and France comprise over half of total European SaaS M&A volumes EUROPEAN SAAS M&A DEAL ACTIVITY BY COUNTRYEuropean SaaS M&A transa

85、ctions,2024 YTD*(%of deal volume)Rest of Europe14%Growth23/24 YTD33%25%16%14%7.0%4.0%UK28%Growth23/24 YTDFrance0%Growth23/24 YTDGermany5%Growth23/24 YTDNetherlands(8.0)%Growth23/24 YTDSweden(27.0)%Growth23/24 YTDYTD-24*Total deals:619619Growth 23/24 YTD*:10%10%M&ASources:GP Bullhound Insights and Pi

86、tchbook(Q1 2020 Q3 2024)Note:*YTD represents 1 January30 September 202432EUROPEAN SAAS DEAL ACTIVITYFundraising volume has experienced a slight decline in2024 YTD with Q1 and Q2 2024 falling by 15%and10%respectively year-over-year.Notably,whilst trading volumes have remained muted,deal value has beg

87、un to recover in 2024 YTD with Q1and Q2 2024 increasing by 17%and 24%respectivelyyear-over-year,indicating a cautious but improvingfunding environment for late-stage SaaS businesseshighlighted by an increase in the share of later-stagerounds.With one quarter remaining in 2024,we anticipateprivate pl

88、acements to increase from the previousquarter as well as year-over-year.Fundraising activity in 2024 remains in line with the previous year with fewer larger roundsEUROPEAN SAAS PRIVATE PLACEMENT DEAL ACTIVITYEuropean SaaS private placement deal volume European SaaS private placement deal value 2021

89、:6,051 deals2020$16.7bn2021$44.9bn2022$46.8bnYTD-24*$16.3bn1,3369721,0931,1881,6411,4201,4781,5121,5651,7081,3971,349960890616795813798652Q1-20Q2-20Q3-20Q4-20Q1-21Q2-21Q3-21Q4-21Q1-22Q2-22Q3-22Q4-22Q1-23Q2-23Q3-23Q4-23Q1-24Q2-24Q3-24$3.9$3.6$4.1$5.0$8.5$14.2$11.8$10.5$17.2$14.5$8.1$7.0$4.1$5.7$4.4$4

90、.6$4.8$7.1$4.3Q1-20Q2-20Q3-20Q4-20Q1-21Q2-21Q3-21Q4-21Q1-22Q2-22Q3-22Q4-22Q1-23Q2-23Q3-23Q4-23Q1-24Q2-24Q3-242022:6,019 deals2023:3,261 dealsYTD-24*:2,263 dealsPRIVATE PLACEMENT(#)($bn)Sources:GP Bullhound Insights and DealRoom(Q1 2020 Q3 2024)Note:*YTD represents 1 January30 September 20242020:4,58

91、9 deals2023$18.8bnMean:1,168 Mean:$7.6m33EUROPEAN SAAS DEAL ACTIVITYIn terms of fundraising value,the 2024 YTD fundraisingprofile is similar to the mix observed in 2023 but with ahigher proportion of mega deals.2024 YTD has an 11%larger weighting on$250m+transactions(on par with2021 and 2022)relativ

92、e to the previous year.With regards to fundraising volume and excluding smallerraises($15m)(which account for 90%+of total raises),each band of fundraising volume in 2024 YTD hasremained steady,in line with previous years.Notable fundraises in 2024 include:General Atlantics$200m investment in Flo He

93、althKKRs$370m investment in LighthouseHg Capitals$621m investment in CubeFundraising value has recovered from 2023 levels,with a rise in the proportion of mega deals EUROPEAN SAAS PRIVATE PLACEMENT DEAL ACTIVITY BY SIZEEuropean SaaS Private Placement value&volume 2020-2024 YTD*PRIVATE PLACEMENTSourc

94、es:GP Bullhound Insights and DealRoom(Q1 2019 Q3 2024)Note:*YTD represents 1 January30 September 202436%20%21%33%28%22%13%16%23%21%21%18%17%18%20%15%24%23%17%12%5%26%23%9%20%2020202120222023YTD-24$16.3bn40m-100m100m-250m250m+15m-40m$46.8bn$44.9bn$16.7bn$18.8bn67%52%56%68%66%25%27%26%21%24%7%15%14%9%

95、7%1%5%4%2%3%2020202120222023YTD-24Volume(excl.$15m)Value10%of Total9%of Total8%of Total5%of Total9%of Total40m-100m100m-250m250m+0m-15m15m-40m2024 select transactions Deal size:$200m$200mDeal size:$621m$621mDeal size:$500m$500mDeal size:$370m$370mDeal size:209m209m34EUROPEAN SAAS DEAL ACTIVITY2024 Y

96、TD has seen nearly 2.3k fundraises across theEuropean SaaS ecosystem,representing an 8%dropcompared to the same period in the previous yearWithin the top environments for fundraising,Spainand the Netherlands saw the hardest hit,decreasingby 28%and 15%respectively year-over-year.France,which saw a ye

97、ar-over-year decline of 54%in 2023has seen slow recovery,where as Germany(whichsaw a year-over-year decline of 45%in 2023)improved to a 4%decrease in 2024Similar to the European M&A market,the UnitedKingdom remains the most active for European SaaSprivate placements in terms of volume,responsiblefor

98、 over one quarter of transactions and growing itsshare from 23%to 26%2024 YTD private placement volume has fallen slightly relative to the same period in 2023European SaaS private placement,2024 YTD*(%of deal volume)Rest of Europe(13.6%)Growth23/24 YTD39.2%25.5%13.6%10.2%5.9%5.7%UK2.5%Growth23/24 YT

99、DGermany(3.8%)Growth23/24 YTDFrance6.5%Growth23/24 YTDNetherlands(14.7%)Growth23/24 YTDSpain(28.1%)Growth23/24 YTDYTD-24*Total deals:2,2632,263Growth 23/24 YTD*:(8.2%)(8.2%)PRIVATE PLACEMENTSources:GP Bullhound Insights and DealRoom(Q1 2020 Q3 2024)Note:*YTD represents 1 January30 September 2024EURO

100、PEAN SAAS PRIVATE PLACEMENT DEAL ACTIVITY BY COUNTRY35EUROPEAN SAAS DEAL ACTIVITYReflective of deal volume,the highest proportion offunding activity in the European SaaS market has beendriven by the UK(38%),Germany(17%),and France(17%).Strong growth in top markets,particularly the UK andFrance(40%an

101、d 20%,respectively),has been thecatalyst behind a 15%($2.1bn)increase in 2024 YTDEuropean fundraising value relative to its comparativeperiod in the previous year,but still significantly behindpre-pandemic levels.UK represents nearly 40%of all European fundraising value in 2024 YTDEuropean SaaS priv

102、ate placement,2024 YTD*(%of deal value)UK37.4%Growth23/24 YTD38.0%16.6%16.5%3.9%3.2%21.7%Spain3.3%Growth23/24 YTDGermany19.3%Growth23/24 YTDNetherlands(11.9%)Growth23/24 YTDFrance28.0%Growth23/24 YTDRest of Europe(13.1%)Growth23/24 YTDEUROPEAN SAAS PRIVATE PLACEMENT DEAL ACTIVITY BY COUNTRYYTD-24*To

103、tal:$16.3bn$16.3bnGrowth 23/24 YTD*:14.7%14.7%PRIVATE PLACEMENTSources:GP Bullhound Insights and DealRoom(Q1 2020 Q3 2024)Note:*YTD represents 1 January30 September 202436Terminology372024 EUROPEAN SAAS SURVEYKey SaaS metricsTerminologyTERMINOLOGYCustomer acquisition cost(CAC)Consists of all the sal

104、es&marketing expenses(staff and non-staff costs)spent to acquire one new customer CACCAC=S&M Expenditure#of new paying customersGross revenue retention(GRR)(%)Number of customers retained in a given period or cohort regardless of account expansion or growth1 (Opening ARR downsell churnOpening ARR)AR

105、R measures the amount of annually recurring revenue,or the sum of all revenue derived from customer contracts over the course of the next 12 months;can serve as an estimate for the size of a business Net revenue retention(NRR)(%)Number of customers gained or lost in a given period or cohort after ta

106、king into consideration new,reactivated,or expanded accounts1 (ARR beginning of period+upsell churn downsell)ARR beginng of period)Payback period represents the time(months)taken to fully pay back sales and marketing investments involved in the acquisition of a new customerLTV is a measure indicatin

107、g the total value of a customer expected over its lifetimePayback periodAnnual Recurringrevenue(ARR)Life-time Value(LTV)Typically calculated on a cohort basis,excluding customers in trial periodsTypically calculated on a cohort basis,excluding customers in trial periodsSource:GP Bullhound Insights38

108、About GP Bullhound392024 EUROPEAN SAAS SURVEYGlobal presence and local expertise for a seamless service1999150+14650+$45bn+$800m+YEAR FOUNDEDPROFESSIONALSOFFICE LOCATIONSSUCCESSFUL TRANSACTIONSTRANSACTION VALUE ADVISED ONAUM ACROSSGP BULLHOUND MANAGED FUNDSNew YorkSan FranciscoMalagaMadridParisLondo

109、nManchesterStockholmBerlinLuxembourgFrankfurtAMERICASEUROPEUNITED KINGDOMMarbellaAucklandSydneyAPAC*Singapore*regional coverage through partnership with North Ridge Partners402024 EUROPEAN SAAS SURVEYExtensive experience in software with strategics and financial sponsorsStrong global software track

110、recordSOFTWARE EXPERIENCEACQUIRED BYFeb-22SOLD TOSOLD TOSOLD TOSOLD TOSOLD TOINVESTMENT BYACQUIREDSOLD TOACQUIREDSOLD TOSOLD TOSOLD TOSOLD TOSOLD TOINVESTMENT BYSOLD TOSOLD TOSOLD TOINVESTMENT BYSOLD TOSOLD TOSOLD TOSOLD TOSOLD TO412024 EUROPEAN SAAS SURVEYAlexis ScorerAlexis ScorerPARTNERAlexis.SRo

111、bbie.LRobbie LenigasRobbie LenigasASSOCIATEBen PittariBen PittariDIRECTORBen.PZeeshan AliZeeshan AliANALYSTZeeshan.AAmaan PunnuAmaan PunnuANALYSTAmaan.PGP BullhoundsEuropean SaaS report team422024 EUROPEAN SAAS SURVEYDisclaimerNo information set out or referred to in this communication shall form th

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