Valuation Archives - Practical Venture Capital

PVC SaaS Index™ | Q1 2023 – SaaS Companies Are Now a Bargain vs. S&P 500

Aman Verjee

03.29.23

IPO
Public Markets
PVC SaaS Index
SaaS
Valuation

Practical Summary: This post is an update in a quarterly series of posts that tracks the PVC SaaS Index™, a basket of publicly traded US-listed SaaS companies. Background: SaaS Multiples in Public Markets Software as a Service (“SaaS”) has been around longer than the cool new cloud. The SaaS category shares some aspects of cloud computing, but

PVC SaaS Index™ | Q4 2022 – Where Will SaaS Multiples Bottom Out?

Aman Verjee

10.19.22

IPO
Public Markets
PVC SaaS Index
Valuation

Practical Summary: Companies in our PVC SaaS Index™ now trade at an average 6.8x EV / LTM revenue, slightly down from the 7.6x multiple observed at the end of Q2 2022. SaaS multiples now trade at levels that haven’t been seen since the 2016 “SaaS crash.” Valuations today have just about normalized. Ignoring the 2020/2021

PVC SaaS Index™ | Q1 2022 Update

Aman Verjee

03.29.22

Public Markets
PVC SaaS Index
SaaS
Valuation

Our PVC SaaS Index™ companies trade at 11x EV / LTM revenues, well within the historical range of 7-12x where SaaS has traded for most of the past 10 years.The median SaaS multiple has compressed by nearly 40% from where it peaked in late 2021, at 18x.

Why is Instacart Repricing its Shares?

Aman Verjee

03.25.22

Valuation

Instacart recently repriced its shares to reduce its valuation by 40%. This move makes great sense for the company, given where all of its public market comparables have traded since the company’s last financing in early 2021. This voluntary re-pricing is a great recruiting tool for the company.

FB: The Big Tech Stock Ben Graham Would Pick

Aman Verjee

02.17.22

Public Markets
Valuation

FB is now trading with a 6.3% “free cash flow yield” (i.e., free cash flows from the business on a per share basis versus its market price per share). That’s four times Treasury yields and twice the rest of the NASDAQ 100.

SaaS IPO Benchmarking | ARR at IPO

Aman Verjee

05.14.20

Public Markets
PVC SaaS Index
Valuation

Revenue growth strongly predicts valuation multiple at the time of IPO. Since 2017, SaaS IPOs trade at an average 18x LTM revenues.