The Qualtrics deal outranks all other acquisitions of enterprise software companies in terms of first exits by VC-backed startups.
The global software-as-a-service (SaaS) industry is projected to reach $75B+ by 2020. Providers like SAP, Microsoft, Oracle, and Salesforce are racing to offer the best products on the market and capture a greater share of corporate technology spending.
This was a primary motivator behind SAP’s $8B acquisition of Qualtrics, one of its many enterprise software acquisitions in recent years.
The Qualtrics acquisition is the second-largest in SAP’s history, behind its $8.3B purchase of expense management platform Concur.
The Qualtrics acquisition is also the largest VC-backed enterprise software acquisition in history (in terms of first-time exits), according to CB Insights’ data. Its exit valuation beat Microsoft’s $7.5B acquisition of GitHub in October 2018.
| Rank | Company | Exit | Valuation | Date |
|---|---|---|---|---|
| 1 | Dropbox | IPO | $12.62B | 3/23/2018 |
| 2 | Qualtrics | Acquired by SAP | $8.00B | 11/11/2018 |
| 3 | GitHub | Acquired by Microsoft | $7.50B | 10/26/2018 |
| 4 | Workday | IPO | $4.49B | 10/12/2012 |
| 5 | DocuSign | IPO | $4.41B | 4/27/2018 |
| 6 | Veeva | IPO | $4.40B | 10/16/2013 |
| 7 | AppDynamics | Acquired by Cisco | $3.70B | 1/24/2017 |
| 8 | Octane | Acquired by E.piphany | $3.41B | 5/8/2000 |
| 9 | MuleSoft | IPO | $2.90B | 3/17/2017 |
| 10 | FireEye | IPO | $2.35B | 9/20/2013 |
Qualtrics had already filed its S-1 and had planned to raise as much as $495M as part of its upcoming IPO.
The company provides product research and customer surveys to more than 9,000 customers globally, including over 75% of the Fortune 100 companies, according to its recent S-1 filing.
While SAP’s Cloud Business Group will certainly benefit from Qualtrics’s products and services, its current clients will likely provide ongoing lead generation for SAP as well.
Qualtrics expects full-year 2018 revenue to exceed $400M and projects a forward growth rate of more than 40%, according to SAP’s announcement of the acquisition.
Qualtrics will maintain it’s leadership, personnel, and branding following the acquisition, and will operate as an entity of SAP’s Cloud Business Group.
Note: We excluded social networking platforms like LinkedIn from our list of enterprise software exits.
If you aren’t already a client, sign up for a free trial to learn more about our platform.