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.
|2||Qualtrics||Acquired by SAP||$8.00B||11/11/2018|
|3||GitHub||Acquired by Microsoft||$7.50B||10/26/2018|
|7||AppDynamics||Acquired by Cisco||$3.70B||1/24/2017|
|8||Octane||Acquired by E.piphany||$3.41B||5/8/2000|
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.