According to Tomasz Tungz, Cisco’s US$3.7B acquisition of AppDynamics at 17.3x trailing 12–month revenues represents the biggest software acquisition multiple paid in the last 10 years.
Tungz further writes…” if this acquisition is any bellwether of the 2017 acquisition environment, it’s going to be a monster year. With 30-40 IPOs on the docket for 2017 – a staggeringly large class – many companies may choose AppD’s path of acquisition over going public, especially if they can command such an impressive premium. The median publicly traded SaaS company trades at 6x as of today. The AppDynamics multiple is nearly triple. At the top of the heap, Blackline and Shopify trade at 12-13x.
Source: Tomasz Tunguz Redpoint Ventures