![Advanced Analytics April 2018 Advanced Analytics April 2018 Sector Dashboard [4]](http://data.docslib.org/img/f1609750d7f2ba02992510a0456e52ff-1.webp)
Sectorwatch: Advanced Analytics April 2018 Advanced Analytics April 2018 Sector Dashboard [4]
Public Basket Performance [5]
Operational Metrics [7]
Valuation Comparison [10]
Recent Deals [13]
Appendix [14]
7 Mile Advisors appreciates the opportunity to present this confidential information to the Company. This document is meant to be delivered only in conjunction with a verbal presentation, and is not authorized for distribution. Please see the Confidentiality Notice & Disclaimer at the end of the document. All data cited in this document was believed to be accurate at the time of authorship and came from publicly available sources. Neither 7 Mile Advisors nor 7M Securities make warranties or representations as to the accuracy or completeness of third-party data contained herein. This document should be treated as confidential and for the use of the intended recipient only. Please notify 7 Mile Advisors if it was distributed in error. 2 Overview
7MA provides Investment Banking & Advisory Services to the Business Services and Technology Industries globally. We advise on M&A and private capital transactions, and provide market assessments and benchmarking. As a close knit team with a long history together and a laser focus on our target markets, we help our clients sell their companies, raise capital, grow through acquisitions, and evaluate new markets. We publish our sectorwatch, a review of M&A and operational trends in the industries we focus.
Dashboard Valuation Comparison • Summary metrics on the sector • Graphical, detailed comparison of • Commentary on market momentum by valuation multiples for the public basket comparing the most recent 12-month performance against the last 3-year averages.
Public Basket Performance Recent Deals • Summary valuation and operating • The most recently announced deals in metrics for a basket of comparable the sector public companies
3 Dashboard
Operating Metrics Revenue Growth Momentum 1 - year revenue growth compared to revenue growth Median LTM GP Margin % 69.2% -0.04 average for last 3 years Current revenue growth rate is less than the average of the last 3 years, indicating that the market may be flattening or declining Median LTM EBITDA Margin % 22.8%
Pricing / Gross Margin Momentum Median LTM Rev. Growth % 6.1% 1 - year gross profit % compared to gross profit % 0.3% average for last 3 years 0% 15% 30% 45% 60% 75% Current gross profit margin exceeds the average of the last 3 years gross profit margin by this amount, indicating supplier pricing power Valuation
Profitability Momentum Median Price / LTM Earnings 26.4x 1 - year EBITDA % compared to EBITDA % average for -0.2% last 3 years Median TEV / LTM EBIT 19.7x Current EBITDA margin is less than the average of the last 3 years EBITDA margins, which may signal further consolidation Median TEV / LTM EBITDA 16.7x
Median TEV / LTM Revenue 5.2x
0x 6x 12x 18x 24x 30x
4 Public Basket
Rev TEV / LTM Rev Growth EBITDA TEV / EBITD Rev / Company TEV $m $m YoY GP % % Rev X A X # FTEs FTE $k
Tableau Software, Inc. 5,783 877 6% 87% -17% 6.6 0.0 3,489 251
Fair Isaac Corporation 5,587 948 5% 69% 23% 5.9 25.9 2,168 437 Accenture plc 93,707 37,126 10% 32% 16% 2.5 15.5 425,000 87
Adobe Systems Incorporated 102,759 7,699 25% 87% 35% 13.3 37.7 17,973 428 SAP SE 129,031 28,875 4% 70% 27% 4.5 16.8 88,543 326 International Business Machines Corporation 167,715 80,056 1% 46% 21% 2.1 10.1 366,600 218 Alphabet Inc. 612,302 117.251 24% 58% 31% 5.2 16.7 80,110 1,464
Average 159,555 38,976 11% 64% 20% 5.7 17.5 140,555 459 Median 102,759 28,875 6% 69% 23% 5.2 16.7 80,110 326 share price as of 26Apr18
5 Public Basket Valuation Trends
20x
18x Public EBITDA Multiples over Time 6x 16x 5x 4x 3x 14x 15.3x 2x 1x
12x 0x
Jul-13 Jul-14 Jul-15 Jul-16 Jul-17
Jan-14 Jan-15 Jan-16 Jan-17 Jan-18
Oct-16 Oct-13 Oct-14 Oct-15 Oct-17
Apr-15 Apr-16 Apr-17 Apr-18 10x Apr-14 TEV/Revenue - Median TEV/Revenue - Average 8x Public Revenue Multiples over Time 6x 4.5x 20x 4x 15x 10x 2x 5x 0x
0x
Jul-13 Jul-14 Jul-15 Jul-16 Jul-17
Jan-14 Jan-15 Jan-16 Jan-17 Jan-18
Oct-13 Oct-14 Oct-15 Oct-16 Oct-17
Apr-14 Apr-15 Apr-16 Apr-17 Apr-18
Jul-13 Jul-14 Jul-15 Jul-16 Jul-17
Jan-14 Jan-15 Jan-16 Jan-17 Jan-18
Oct-13 Oct-14 Oct-15 Oct-16 Oct-17
Apr-16 Apr-14 Apr-15 Apr-17 Apr-18 TEV/EBITDA - Median TEV/EBITDA - Average TEV/EBITDA - Median TEV/Revenue - Median TEV/EBITDA - Average TEV/Revenue - Average
6 Operational Metrics
LTM Gross Profit Margin % LTM EBITDA %
Tableau Software, Inc. Adobe Systems Incorporated
Adobe Systems Incorporated Alphabet Inc.
SAP SE SAP SE
Fair Isaac Corporation Fair Isaac Corporation
International Business Machines Alphabet Inc. Corporation
International Business Machines Accenture plc Corporation
Accenture plc Tableau Software, Inc.
Median Median
- 20% 40% 60% 80% 100% (20%) - 20% 40%
7 Operational Metrics
LTM Revenue per LTM Revenue Growth % Full Time Employee x 000’s
Adobe Systems Incorporated Alphabet Inc.
Alphabet Inc. Fair Isaac Corporation
Accenture plc Adobe Systems Incorporated
Tableau Software, Inc. SAP SE
Fair Isaac Corporation Tableau Software, Inc.
SAP SE International Business Machines Corporation
International Business Machines Corporation Accenture plc
Median Median
- 10% 20% 30% $- $400 $800 $1,200 $1,600
8 Operational Metrics
Average Days Accounts Receivable Turnover Sales Outstanding
International Business SAP SE Machines Corporation
Adobe Systems Tableau Software, Inc. Incorporated
Alphabet Inc. Accenture plc
Fair Isaac Corporation Fair Isaac Corporation
Accenture plc Alphabet Inc.
Adobe Systems Tableau Software, Inc. Incorporated
International Business SAP SE Machines Corporation
Median Median
0 2 4 6 8 10 12 - 20 40 60 80 100
9 Valuation
TEV / LTM Revenue TEV / LTM EBITDA
Adobe Systems Adobe Systems Incorporated Incorporated
Tableau Software, Inc. Fair Isaac Corporation
Fair Isaac Corporation SAP SE
Alphabet Inc.
Alphabet Inc.
SAP SE
Accenture plc Accenture plc
International Business International Business Machines Corporation Machines Corporation
Median Median
0x 5x 10x 15x 0x 10x 20x 30x 40x
10 Valuation
TEV / LTM EBIT Price / LTM Earnings
Adobe Systems Adobe Systems Incorporated Incorporated
Fair Isaac Corporation Fair Isaac Corporation
Alphabet Inc. Alphabet Inc.
SAP SE Accenture plc
Accenture plc SAP SE
International Business International Business Machines Corporation Machines Corporation
Median Median
0x 10x 20x 30x 40x 50x 0x 15x 30x 45x 60x 75x
11 Valuation
Historical Valuation Multiples Historical Valuation Multiples versus Gross Profit versus Revenue Growth Rate
40x 100% 40x 30%
87.1% 86.6% 90% 25.1% 35x 35x 23.7% 25% 80% 70.2% 30x 30x 70% 20% 25x 58.0% 69.2% 60% 25x
20x 45.6% 50% 20x 15%
40% 15x 15x 10% 30% 31.5% 10x 6.1% 10x 10.0% 3.6% 20% 0.8% 5% 5x 10% 5x 5.2%
0x 10x 16x 17x 17x 26x 38x 0x 10x 16x 17x 17x 26x 38x
EBITDA(x) EBITDA(x) LTM GP% LTM
0x 0% 0x 0% RGR% LTM
EBITDA(x) LTM GP% EBITDA(x) LTM RGR%
12 Recent Transactions Total Transaction Target TEV / TEV / Date Target Buyer / Investor Value Revenue Revenue EBITDA
14Mar18 Avarea Oy Digia Oyj - 4.44 - - 10Jan18 CBIG Consulting, LLC Trianz Holdings Pvt. Limited - - - - 20Dec17 Innowera LLC Magnitude Software, Inc. - - - - 25Oct17 Zettafox Mazars Group - - - - 7Sep17 Logmatic.io Datadog, Inc. - - - - 21Aug17 Affecto Oyj CGI Nordic Investments Limited 132.94 140.98 0.8x 16.3x 8Jun17 Elite Analytics LLC Aviana Global Technologies, Inc. - - - - 1Jun17 4i, Inc. Fractal Analytics Inc. - - - - 1Feb17 YourMembership.com, Inc. Insight Venture Partners LLC; MBP Holdings Limited - - - - 24Jan17 BlueFlare, LLC Robots and Pencils Corp. - - - - 1Dec16 The Encima Group, Inc. Indegene Lifesystems Pvt Ltd. 16.00 - - - 18Aug16 INTELLEGO S.C Southern Cross Group - - - - 31May16 Syslogic Technical Services Inc. Incedo Inc. - - - - 31Oct15 Bring Focus 2 Group, S.A. Oxy Capital - Sociedade de Capital de Risco SA; Fundo Revitalizar Centro 1.69 - - - 2Jun16 Recommind, Inc. Open Text Corporation 163.00 - - - 11May16 Vestrics, Inc. The Ultimate Software Group, Inc. 10.10 - - - 19May16 ProbaYes SAS Mediapost Holding SAS - - - - 17May16 Datalytics Technologies LLC Magnitude Software, Inc. - - - - 3Apr16 MphasiS Limited The Blackstone Group L.P. 892.05 916.37 1.1x 6.3x 29Mar16 EagleEye Analytics, Inc. Guidewire Software, Inc. 42.00 - - - 20Mar16 Boire Filler Group Environics Analytics Group Ltd. - - - - 22Dec15 ShopperTrak RCT Corporation Tyco International plc 175.00 75.00 2.3x - 5Nov15 MarketShare Partners LLC NeuStar, Inc. 450.00 51.17 8.8x - 15Oct15 Fitzgerald Analytics, Inc. Square Root Solutions, Inc. - - - - 1Sep15 Creatix Inc. GoHealth, LLC - - - - 1Jul15 Torque Solutions (Australia) Pty Ltd Velocity Frequent Flyer Pty Ltd 3.66 - - - 2Jul15 X-Ray Analytics Blackboard Inc. - - - - 31Mar15 Velos, Inc. Oath Inc. - - - - 26Feb15 Prelytix, LLC Market Resource Partners LLC 19.98 2.00 10.0x 199.9x 3Sep14 Think Big Analytics, Inc. Teradata Corporation - - - - 21Aug14 Invati Insights Private Limited (nka:Cyient Cyient Limited 1.45 - - - Insights Private Limited) 9Jul14 Fractal Analytics Inc. Aimia India Loyalty Management Private Limited; Aimia Proprietary - - - - Loyalty Singapore Pte. Ltd. 17Apr14 Opera Solutions, LLC Wipro Limited - - - - 22Jan14 Scout Analytics, Inc. ServiceSource International, Inc. 32.50 5.40 6.0x - 31Dec12 Rogue Wave Software, Inc. Audax Group, Inc. - - - - 7May13 Opera Solutions, LLC Wipro Limited 30.00 100.00 - - 25Jan13 Angoss Software Corp. Peterson Partners LP 8.47 6.98 1.1x NM
13 Advanced Analytics April 2018 APPENDIX:
Public Basket
Constituents
7 Mile Advisors appreciates the opportunity to present this confidential information to the Company. This document is meant to be delivered only in conjunction with a verbal presentation, and is not authorized for distribution. Please see the Confidentiality Notice & Disclaimer at the end of the document. All data cited in this document was believed to be accurate at the time of authorship and came from publicly available sources. Neither 7 Mile Advisors nor 7M Securities make warranties or representations as to the accuracy or completeness of third-party data contained herein. This document should be treated as confidential and for the use of the intended recipient only. Please notify 7 Mile Advisors if it was distributed in error. 14 Revenue Multiples - Tableau Software, Inc. 30x Public Basket 25x 20x 15x 10x 5x Tableau Software, Inc. 0x Tableau Software, Inc. provides business analytics software products. It offers Tableau Desktop, an analytics product that empowers people to access and analyze data; and Tableau TEV/Revenue Average Server, a business intelligence platform with data management and scalability to foster sharing of analytics, as well as to EBITDA Multiples - Tableau Software, Inc. 310x enhance the dissemination of information in an organization and 300x promote decision-making. The company also provides Tableau 290x Online, a hosted software-as-a-service version of Tableau 280x Server; and Tableau Public, a cloud-based platform that allows 270x various users, such as bloggers, journalists, researchers, and 260x government workers to visualize public data on their Websites. In 250x addition, it offers Visual Query Language (VizQL) for databases, which is a computer language for describing pictures of data, including graphs, charts, maps, time series, and tables of TEV/EBITDA Average visualizations; Live Query Engine that interprets abstract queries generated by VizQL into syntax understandable by various database systems; Tableau Software, Inc. was founded in 2003 and is headquartered in Seattle, Washington.
Date Key Development Headline 8/8/17 Tableau Software, Inc. (NYSE:DATA) acquired ClearGraph from
15 Revenue Multiples - Fair Isaac Corporation 8x Public Basket 6x 4x 2x Fair Isaac Corporation 0x Fair Isaac Corporation develops analytic, software, and data management products and services that enable businesses to automate, enhance, and connect decisions. The company offers TEV/Revenue Average analytical solutions, credit scoring, and credit account management products and services to banks, credit reporting EBITDA Multiples - Fair Isaac Corporation 35x agencies, credit card processing agencies, insurers, retailers, 28x healthcare organizations, and public agencies. It operates through three segments: Applications, Scores, and Decision 21x Management Software. The Applications segment offers pre- 14x configured decision management applications designed for 7x various business problem or process, such as marketing, 0x account origination, customer management, fraud, collection, and insurance claims management, as well as associated professional services. The Scores segment provides business- TEV/EBITDA Average to-business scoring solutions and services, including myFICO solutions for consumers that give clients access to analytics to P/E Multiples - Fair Isaac Corporation be integrated into their transaction streams and decision-making 60x processes, as well as associated professional services. Fair 45x Isaac Corporation was founded in 1956 and is headquartered in San Jose, California. 30x 15x 0x
Date Key Development Headline P/E Average 7/31/17 Fair Isaac Seeks Acquisitions
16 Revenue Multiples - Accenture plc 3.0x Public Basket 2.4x 1.8x 1.2x 0.6x Accenture plc 0.0x Accenture plc provides consulting, technology, and outsourcing services worldwide. Its Communications, Media & Technology TEV/Revenue Average segment provides professional services that help clients accelerate and deliver digital transformation, and enhance business results through industry-specific solutions for EBITDA Multiples - Accenture plc 20x communications, media, and high tech industries, as well as for software platforms. The company’s Financial Services segment 15x offers services that address profitability pressures, industry 10x consolidation, regulatory changes, and the need to continually 5x adapt to new digital technologies. This segment serves clients in banking, capital markets, and insurance industries. Its Health & 0x Public Service segment provides research-based insights and offerings, including consulting services and digital solutions to help clients deliver social, economic, and health outcomes. TEV/EBITDA Average Accenture plc was founded in 1989 and is based in Dublin, Ireland. P/E Multiples - Accenture plc 35x 28x 21x 14x Date Key Development Headline 7x 3/28/18 Accenture plc (NYSE:ACN) entered into an agreement to acquire 0x acquire Meredith Xcelerated Marketing from Meredith Corporation Corporation (NYSE:MDP). 3/20/18 Accenture and SAP Build and Deploy Extended Planning Solutions on SAP S/4HANA® P/E Average
17 Revenue Multiples - Adobe Systems 20x Incorporated Public Basket 15x 10x 5x Adobe Systems Incorporated 0x Adobe Systems Incorporated operates as a diversified software company worldwide. Its Digital Media segment provides tools TEV/Revenue Average and solutions that enable individuals, small and medium businesses, and enterprises to create, publish, promote, and monetize their digital content. Its flagship product is Creative EBITDA Multiples - Adobe Systems 75x Cloud, a subscription service that allows customers to download Incorporated 60x and install the latest versions of its creative products. This segment serves traditional content creators, Web application 45x developers, and digital media professionals, as well as their 30x management in marketing departments and agencies, 15x companies, and publishers. The company’s Digital Marketing 0x segment offers solutions for how digital advertising and marketing are created, managed, executed, measured, and optimized. TThe company was founded in 1982 and is TEV/EBITDA Average headquartered in San Jose, California. P/E Multiples - Adobe Systems 300x Incorporated 240x 180x Date Key Development Headline 120x 4/15/18 Adobe Systems Incorporated (NasdaqGS:ADBE) acquired Sayspring, Inc. 60x 12/15/17 Adobe Systems Mulls Acquisitions 0x 8/22/17 Hootsuite and Adobe Collaborate to Unlock the Value of Creative Creative Content Across Social 6/21/17 Adobe Systems Incorporated (NasdaqGS:ADBE) acquired Mettle. Mettle. P/E Average
18 Revenue Multiples - SAP SE 7.5x Public Basket 6.0x 4.5x 3.0x 1.5x SAP SE 0.0x SAP SE operates as an enterprise application software, and analytics and business intelligence company worldwide. It offers TEV/Revenue Average SAP HANA, which enables businesses to process and analyze live data; SAP Data Hub, a solution that enables businesses to manage data from various sources; SAP Cloud Platform, which EBITDA Multiples - SAP SE 25x enables businesses to connect and integrate applications; SAP 20x BW/4HANA, a data warehouse solution; SAP Leonardo, a system that enables customers to make business sense and 15x opportunity of disruptive technologies; and SAP Analytics Cloud, 10x which leverages the intersection of business intelligence, 5x planning, and predictive analytics. SAP SE was founded in 1972 0x and is headquartered in Walldorf, Germany.
TEV/EBITDA Average
P/E Multiples - SAP SE 50x Date Key Development Headline 3/20/18 Accenture and SAP Build and Deploy Extended Planning 40x Solutions on SAP S/4HANA® 30x 2/12/18 SAP Seeks Acquisition 20x 2/1/18 Virtual Power Systems Joins SAP and Schneider Electric to to Prove Software-Defined Power Optimizes Energy Utilization in 10x Utilization in Data Centers and Clouds 0x 11/14/17 EY Collaborates with SAP to Continue Advancement of Blockchain Deployment Across Industries Worldwide 10/9/17 VMware, Inc. Teams Up with SAP to Accelerate and Streamline Streamline Enterprise IoT Initiatives P/E Average
19 Revenue Multiples - International Business 4x Machines Corporation Public Basket 3x 2x 1x International Business Machines Corporation 0x International Business Machines Corporation operates as an integrated technology and services company worldwide. This TEV/Revenue Average segment also offers data and analytics solutions, including analytics and data management platforms, cloud data services, EBITDA Multiples - International Business enterprise social software, talent management solutions, and 20x solutions tailored by industry; International Business Machines Machines Corporation Corporation was founded in 1911 and is headquartered in 15x Armonk, New York. 10x 5x 0x
Date Key Development Headline 2/22/18 Industrial Realty Group, LLC completed the acquisition of the TEV/EBITDA Average the Rochester, Minnesota technology campus of International International Business Machines Corporation (NYSE:IBM) for for $33.9 million. P/E Multiples - International Business 50x 2/15/18 IBM and SpaceBelt Collaborate on Innovative Architecture for Machines Corporation Architecture for Secure Cloud Management and Storage in Space 40x in Space 30x 2/11/18 Graph Blockchain Enters into Definitive Agreement to Develop 20x Develop Large Scale Graph Database and Blockchain Solution Solution Prototype in Partnership with IBM 10x 2/1/18 Vestas Wind Systems A/S (CPSE:VWS) entered into an 0x agreement to acquire Utopus Insights, Inc. for approximately approximately $100 million. 1/19/18 IBM and Salesforce Announces an Expansion of Their Strategic Strategic Partnership P/E Average
20 Revenue Multiples - Alphabet Inc. 10x Public Basket 8x 6x 4x 2x Alphabet Inc. 0x Alphabet Inc., through its subsidiaries, provides online advertising services in the United States and internationally. The company offers performance and brand advertising services. It TEV/Revenue Average operates through Google and Other Bets segments. The Google EBITDA Multiples - Alphabet Inc. segment includes principal Internet products, such as Ads, 30x Android, Chrome, Commerce, Google Cloud, Google Maps, 24x Google Play, Hardware, Search, and YouTube, as well as 18x technical infrastructure and newer efforts, including Virtual Reality. Alphabet Inc. was founded in 1998 and is headquartered 12x in Mountain View, California. 6x 0x
TEV/EBITDA Average Date Key Development Headline 3/19/18 Alphabet Inc. (NasdaqGS:GOOGL) acquired Chelsea Market in P/E Multiples - Alphabet Inc. Market in New York from Jamestown L.P. for $2.4 billion. 75x 3/17/18 Alphabet's Cloud Boss Seeks Acquisitions 60x 3/4/18 The Infatuation Inc. entered into an agreement to acquire Zagat acquire Zagat Survey, LLC from Alphabet Inc. 45x (NasdaqGS:GOOGL). 30x 1/10/18 Alphabet Inc. (NasdaqGS:GOOGL) acquired NVF Tech Ltd. from 15x Ltd. from Arie Ventures and others. 1/2/18 Microsoft Azure signed an agreement to acquire Avere Systems, 0x Systems, Inc. from Menlo Ventures, Norwest Venture Partners, Partners, Alphabet Inc. (NasdaqGS:GOOGL), Lightspeed Venture Venture Partners, Tenaya Capital Inc., Western Digital Capital P/E Average Capital and others.
21 Contact Information 7MA provides Investment Banking & Advisory Services to the Business Services and Technology Industries globally. We advise on M&A and private capital transactions, and provide market assessments and benchmarking. As a close- knit team with a long history together and a laser focus on our target markets, we help our clients sell their companies, raise capital, grow through acquisitions, and evaluate new markets. Securities offered through 7M Securities LLC.
Leroy Davis, Partner 704.899.5962 [email protected] Tripp Davis, Partner 704.899.5762 [email protected] Andy Johnston, Partner 704.899.5961 [email protected]
Tom Dinnegan, Managing Director 310. 426.2410 [email protected] Ben Lunka, Managing Director 704.496.2995 [email protected] Jeff Stoecklein, Managing Director 312.373.3737 [email protected] Kristina Sergueeva, Director 704.899.5149 [email protected] Neil Churman, Director 704.899.5960 x 121 [email protected] John Cooper, Director 704.973.3996 [email protected]
Tim Frye, Director 704.973.3994 [email protected] Casey Augustine, Business Development - Manager 704.973.3999 [email protected] Nicholas Prendergast, Financial Analyst 704.899.5960 [email protected] Ariail Siggins, Marketing Director 704.899.5960 x 123 [email protected]
Sydney Larese, Associate 704.899.5960 [email protected] Marty Johnson, Associate 704.899.5960 [email protected] Rory Julyan, Associate 704.899.5960 [email protected]
Chevonese Dacres, Analyst 360.499.1502 [email protected]
22