Costs in 2018 are the highest across this time period. Before 2018 two acquisitions have been consummated at EV/TTM earnings multiples over 10. In 20x +, six of seven acquisitions have gone at three and 10x + in 2018. It’s astounding.
Qualtrics brought 23x trailing twelve months earnings multiple. This is the largest one of those I’ve tracked. The only one greater is that the Microsoft/Github acquisition, that can be based on press reports of rsquo & Github ;s earnings. Every one of the additional data points is substantiated through investor disclosures. It’s ever VC backed software acquisition. Congratulations to the Qualtrics team!
Another week! Qualtrics is a Utah. Qualtrics writes and sells software to ask questions of employees and clients to help companies enhance customer experience, worker satisfaction goods, and manufacturer. Qualtrics had intended to go public this past week. The company generated $342M in the last twelve months and had grown 27.
Last November, a year ago, I estimated that the latent purchasing power of this software ecosystem to be about $30B, excluding debt. I had been off by a factor of two.
Let’s put the 2018 acquisition surroundings into context. It’s the marketplace to get $ 1B + earnings with six in the previous seven years. 2012 witnessed 3 acquisitions. In addition, 2018 acquisition values for this kind of acquisition exceed $60B, more than double 2016, which included the Microsoft/LinkedIn merger.

The shift to the cloud has happened at a scale that was larger than many legacy applications companies estimated. And they’re currently spending to catch up. IBM acquired one firm. Microsoft bought Github and LinkedIn. SAP purchased 5 companies: Ariba Concur Successfactors.

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