March 2021
Sectorwatch:E-commerce
7 Mile Advisors
E-commerce
7 Mile Advisors appreciates the opportunity to present this confidential information to the Company. This document is meant to be delivered only inconjunction 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 nor7M Securities make warranties or representations as to the accuracy or completeness of third-party data contained herein. This document should be treatedas confidential and for the use of the intended recipient only. Please notify 7 Mile Advisors if it was distributed in error.
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Sector Dashboard
Public Basket Overview
Public Basket Performance
Operational Metrics
Valuation Comparison
Recent Deals
Appendix
2
Overview
7MA provides Investment Banking & Advisory Services to the Business Services and Technology Industries globally.
DASHBOARD
PUBLIC BASKET PERFORMANCE
VALUATION COMPARISON
RECENT DEALS
• Summary metrics on the sector• Commentary on market momentum by comparing the
most recent 12-month performance against the last 3-year averages.
• Summary valuation and operating metrics for a basket of comparable public companies.
• Graphical, detailed comparison of valuation multiples for the public basket.
• The most recently announced deals in the sector
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.
1 - year revenue growth compared to revenue growth 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
-12.8%
5.6x
12.8x
35.1x
32.9x
0x 10x 20x 30x 40x 50x
Median TEV / LTM Revenue
Median TEV / LTM EBITDA
Median TEV / LTM EBIT
Median Price / LTM Earnings
4.6%
20.7%
61.9%
0% 10% 20% 30% 40% 50% 60% 70%
Median LTM Rev. Growth %
Median LTM EBITDA Margin %
Median LTM GP Margin %
Dashboard
4
Operating Metrics
Valuation
REVENUE GROWTH MOMENTUM
0
50
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150
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300
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400
2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
M&A Activity
Deal Count
E-commerce Platforms
Platforms Overview
5
United States
Germany
Canada
India
Oracle 245,212 19,415 39,402 -0.5% 80.3% 49.3% 6.2x 12.6x 135,000 292
Adobe Systems 208,186 5,719 12,868 15.2% 86.6% 44.4% 16.2x 36.4x 22,516 572
Salesforce.com 188,838 4,960 20,286 28.0% 74.5% 24.5% 9.3x 38.1x 49,000 414
SAP 155,984 11,324 31,163 -0.8% 71.2% 36.3% 5.0x 13.8x 102,430 304
Shopify 128,131 495 2,929 85.6% 52.6% 16.9% 43.7x 258.8x 5,000 586
HCL Technologies 35,964 2,778 9,997 9.2% 46.5% 27.8% 3.6x 12.9x 159,682 63
BigCommerce 4,014 -25 152 35.9% 77.6% -16.1% 26.3x -163.8x 600 254
Company TEV $mLTM
EBITDA $mLTM Rev
$m
Rev Growth
YoYGP % EBITDA % TEV / Rev X
TEV / EBITDA X
# FTEsRev / FTE
$k
Public Basket - Platforms
6
Average 138,047 6,381 16,685 24.7% 69.9% 26.2% 15.8x 29.8x 67,747 355
Median 155,984 4,960 12,868 15.2% 74.5% 27.8% 9.3x 13.8x 49,000 304
0x2x4x6x8x
10x12x
Mar
-16
Jun-
16
Sep
-16
Dec
-16
Mar
-17
Jun-
17
Sep
-17
Dec
-17
Mar
-18
Jun-
18
Sep
-18
Dec
-18
Mar
-19
Jun-
19
Sep
-19
Dec
-19
Mar
-20
Jun-
20
Sep
-20
Dec
-20
Mar
-21
TEV/Revenue - Median TEV/Revenue - Average
0x
10x
20x
30x
40x
50x
Mar
-16
Jun-
16
Sep
-16
Dec
-16
Mar
-17
Jun-
17
Sep
-17
Dec
-17
Mar
-18
Jun-
18
Sep
-18
Dec
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19
Sep
-19
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Mar
-20
Jun-
20
Sep
-20
Dec
-20
Mar
-21
TEV/EBITDA - Median TEV/EBITDA - Average
Public Basket - PlatformsPublic EBITDA Multiples over Time
Public Revenue Multiples over Time
7
37.6x
7.2x
0x
5x
10x
15x
20x
25x
30x
35x
40x
45x
No
v-15
Jan-
16
Mar
-16
May
-16
Jul-
16
Sep
-16
No
v-16
Jan-
17
Mar
-17
May
-17
Jul-
17
Sep
-17
No
v-17
Jan-
18
Mar
-18
May
-18
Jul-
18
Sep
-18
No
v-18
Jan-
19
Mar
-19
May
-19
Jul-
19
Sep
-19
No
v-19
Jan-
20
Mar
-20
May
-20
Jul-
20
Sep
-20
No
v-20
TEV/EBITDA - Median TEV/Revenue - Median
TEV/EBITDA - Average TEV/Revenue - Average
Operational Metrics
LTM Gross Profit Margin % LTM EBITDA %
8
(40%) (20%) - 20% 40% 60%
Median
BigCommerce
Shopify
Salesforce
HCL Technologies
SAP
Adobe Systems
Oracle
- 20% 40% 60% 80% 100%
Median
HCL Technologies
Shopify
SAP
Salesforce
BigCommerce
Oracle
Adobe Systems
Operational Metrics
LTM Revenue Growth %LTM Revenue per
Full Time Employee x 000’s
9
$- $200 $400 $600 $800
Median
HCL Technologies
BigCommerce
Oracle
SAP
Salesforce
Shopify
Adobe Systems
- 20% 40% 60% 80%
Median
SAP
Adobe Systems
Salesforce
HCL Technologies
Shopify
Operational Metrics
Accounts Receivable TurnoverAverage Days
Sales Outstanding
10
0x 5x 10x 15x
Median
SAP
Salesforce
BigCommerce
Oracle
Adobe Systems
Shopify
0 20 40 60 80 100
Median
Shopify
Adobe Systems
Oracle
BigCommerce
Salesforce
SAP
Valuation
TEV / LTM Revenue TEV / LTM EBITDA
11
0x 20x 40x 60x 80x
Median
HCL Technologies
SAP
Oracle
Salesforce
Adobe Systems
BigCommerce
Shopify
-400x -200x 0x 200x 400x 600x
Median
BigCommerce
Oracle
HCL Technologies
SAP
Adobe Systems
Salesforce
Shopify
Valuation
TEV / LTM EBIT Price / LTM Earnings
12
0x 500x 1000x 1500x 2000x
Median
Oracle
HCL Technologies
SAP
Adobe Systems
Salesforce
Shopify
0x 200x 400x 600x 800x
Median
Oracle
HCL Technologies
SAP
Adobe Systems
Salesforce
Shopify
12x 13x 22x 49x 66x
15.3%
(0.8%)
7.4%
16.8%
31.6%
-5%
0%
5%
10%
15%
20%
25%
30%
35%
0x
10x
20x
30x
40x
50x
60x
70x
LTM
RG
R%
EBIT
DA(x
) EBITDA(x) LTM RGR%
12x 13x 22x 49x 66x
47.1%
80.0%
70.5%
86.0%
74.6%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
0x
10x
20x
30x
40x
50x
60x
70x
LTM
GP%
EBIT
DA(x
)
EBITDA(x) LTM GP%
Historical Valuation Multiples versus Gross Profit
Historical Valuation Multiples versus Revenue Growth Rate
Valuation
13
Recent Transactions
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Date Target BuyerTotal Transaction
Amount
Target Revenue (TTM at time of
deal) TEV /
Revenue TEV / EBITDA
09-Mar-21 Toplooks Klarna - - - -04-Mar-21 Downstream Jungle Scout - - - -04-Mar-21 Jungle Scout Summit Partners 110.00 - - -03-Mar-21 PrimaSeller Delhivery - - - -02-Mar-21 Invoice Delivery Services Premier 80.00 - - -
01-Mar-21 Fulfilmentcrowd BGF 10.40 - - -01-Mar-21 Macaw Avedon Capital Partners - - - -
26-Feb-21 Picodi Meliuz 22.18 - 7.44 -25-Feb-21 Yapo.cl Frontier Digital Ventures 19.50 - - -
23-Feb-21 PickupXL Klintberg & Way - - - -22-Feb-21 Market Pay (France) AnaCap Financial Partners 362.93 - 10.61 -
22-Feb-21 Marsplay EkAnek Networks - - - -19-Feb-21 Dooca Commerce Locaweb Internet Services 4.91 - 3.89 -
17-Feb-21 Bravo Business Media Investcorp Strategic Capital Group - - - -
17-Feb-21 DEAR Systems Cin7 - - - -16-Feb-21 Selz Amazon.com - - - -16-Feb-21 TWG (Toronto) Deloitte Digital - - - -15-Feb-21 Lengow Marlin Equity Partners - - - -13-Feb-21 WyzAnt IXL Learning - - - -11-Feb-21 Eletype Accel-KKR - - - -11-Feb-21 Sber Eapteka R-Pharm 152.55 - 1.70 -10-Feb-21 Webtiser Swisscom - - - -10-Feb-21 WIN Brands Group Assembled Brands 50.00 - - -
E-commerce - March 2021
AppendixPublic BasketContact Information
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Public Basket - Platforms
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Oracle provides database technology and enterprise resource planning, or ERP, software to enterprises around the world.
Founded in 1977, Oracle pioneered the first commercial SQL-based relational database management system. Today, Oracle has 430,000 customers in 175 countries, supported by its base of 136,000 employees.
Oracle
Oracle
Public Basket - Platforms
17
0.0x
1.0x
2.0x
3.0x
4.0x
5.0x
6.0x
7.0x
Revenue Multiples - Oracle
TEV/Revenue Average
0x
2x
4x
6x
8x
10x
12x
14x
16x
EBITDA Multiples - Oracle
TEV/EBITDA (Analyst Normalized)Average
0x
5x
10x
15x
20x
25x
P/E Multiples - Oracle
P/E (Analyst Normalized) Average
Oracle
Company Name Date Deal Synopsis
Nor1 18-Nov-20 The company reached a definitive agreement to be acquired by Oracle (NYS: ORCL) for an undisclosed amount on November 18, 2020.
Sauce Video 27-Apr-20The company was acquired by Oracle (NYS: ORCL) for an undisclosed amount on April 27, 2020. The acquisition helps Oracle to enhance its portfolio with advanced video capabilities and to provide customers with a comprehensive set of content creation and management tools in order to create exceptional customer, employee and supplier experiences.
Public Basket - Platforms
18
Adobe provides content creation, document management, and digital marketing and advertising software and services to creative professionals and marketers for creating, managing, delivering,
The company operates with three segments: digital media content creation, digital experience for marketing solutions, and publishing for legacy products (less than 5% of revenue).
Adobe Systems
Adobe Systems
Public Basket - Platforms
19
0.0x2.0x4.0x6.0x8.0x
10.0x12.0x14.0x16.0x18.0x
20.0x
Revenue Multiples - Adobe Systems
TEV/Revenue Average
0x5x
10x15x
20x25x30x35x40x45x50x
EBITDA Multiples - Adobe Systems
TEV/EBITDA (Analyst Normalized)Average
0x
10x
20x
30x
40x
50x
60x
70x
P/E Multiples - Adobe Systems
P/E (Analyst Normalized) Average
Adobe Systems
Company Name Date Deal Synopsis
Workfront 07-Dec-20 The company was acquired by Adobe Systems (NAS: ADBE) for $1.5 billion on December 7, 2020.
Facebook (Oculus Medium) 09-Dec-19Oculus' virtual reality sculpting tool was acquired by Adobe for an undisclosed amount on December 09,2019. The acquisition will enable Facebook to accelerate 3D & immersive offerings.
Public Basket - Platforms
20
Salesforce.com provides enterprise cloud computing solutions, including Sales Cloud, the company's main customer relationship management software-as-a-service product.
Salesforce.com also offers Service Cloud for customer support, Marketing Cloud for digital marketing campaigns, Commerce Cloud as an e-commerce engine, the Salesforce Platform, which allows enterprises to build applications, and other solutions, such as MuleSoft for data integration.
Salesforce.com
Salesforce.com
Public Basket - Platforms
21
0.0x
2.0x
4.0x
6.0x
8.0x
10.0x
12.0x
Revenue Multiples - Salesforce.com
TEV/Revenue Average
0x
10x
20x
30x
40x
50x
60x
70x
80x
90x
100x
EBITDA Multiples - Salesforce.com
TEV/EBITDA (Analyst Normalized)
0x200x400x600x800x
1000x1200x1400x1600x1800x
2000x
P/E Multiples - Salesforce.com
P/E (Analyst Normalized) Average
Salesforce.com
Company Name Date Deal Synopsis
Acumen Solutions 3/23/20The company was acquired by Salesforce (NYS: CRM) for an undisclosed amount on February 1, 2021. The acquisition will enable Salesforce Professional Services to help industry customers get closer to their clients and constituents through the Customer 360 Platform.
Slack 1/6/20The company reached a definitive agreement to be acquired by Salesforce (NYS: CRM) for an estimated $27.7 billion on December 1, 2020. Under the terms of the agreement, the company's shareholders will receive $26.79 in cash and 0.0776 shares of Salesforce common stock for each of the company's shares.
Public Basket - Platforms
22
Founded in 1972 by former IBM employees, SAP provides database technology and enterprise resource planning software to enterprises around the world.
Across more than 180 countries, the company serves 440,000 customers, approximately 80% of which are small to medium-size enterprises.
SAP
SAP
Public Basket - Platforms
23
0.0x
1.0x
2.0x
3.0x
4.0x
5.0x
6.0x
7.0x
Revenue Multiples - SAP
TEV/Revenue Average
0x2x4x6x8x
10x12x14x16x18x
20xEBITDA Multiples - SAP
TEV/EBITDA (Analyst Normalized)Average
0x
5x
10x
15x
20x
25x
30x
35x
P/E Multiples - SAP
P/E (Analyst Normalized) Average
SAP
Company Name Date Deal Synopsis
AppGyver 11-Feb-21 The company was acquired by SAP (ETR: SAP) for an undisclosed amount on February 11, 2021.
Signavio 27-Jan-21 The company reached a definitive agreement to be acquired by SAP (ETR: SAP) for EUR 1 billion on January 27, 2021.
Public Basket - Platforms
24
Shopify offers an e-commerce platform primarily to small and midsize businesses.
The firm has two segments: subscription solutions (43% of fiscal 2018 revenue) and merchant solutions (57% of fiscal 2018 revenue). The subscription solutions segment allows Shopify merchants to conduct e-commerce on a variety of platforms, including the company's website, physical stores, pop-up stores, kiosks, social networks (Facebook), and Amazon. Merchant solutions are add-on products for the platform that facilitate e-commerce and include Shopify Payments, Shopify Shipping, and Shopify Capital.
Shopify
Shopify
Public Basket - Platforms
25
0.0x
10.0x
20.0x
30.0x
40.0x
50.0x
60.0x
Revenue Multiples - Shopify
TEV/Revenue Average
Shopify
Company Name Date Deal Synopsis
Affirm 16-Sep-20The company raised $509.95 million of Series G venture funding in a deal led by Durable Capital Partners and Government of Singapore Investment Corporation (GIC) on September 16, 2020. Lightspeed Venture Partners, CMFG Ventures, Spark Capital, Founders Fund and 5 other investors also participated in the round.
6 River Systems 17-Oct-19The company was acquired by Shopify (TSE: SHOP) for $394 million on October 17, 2019. This will enable Shopify to help thousands of businesses improve their fulfillment operations, while 6 River Systems will continue to expand its industry-leading solution for warehouses.
Public Basket - Platforms
26
HCL Technologies Ltd provides enterprises with IT solutions in India.
It focuses on offering Digital, Internet of Things Services, Cloud, Automation, Cybersecurity, Infrastructure Management, and Engineering Services to solve business problems for clients. While the company is based in India, it has international clients in a large number of countries. It offers solutions to a variety of industries including Financial Services, Public Services, Consumer Services, Healthcare, and Manufacturing. It operates in three segments Software services, IT Infrastructure services, and Business Process Outsourcing services. The firm emphasizes consultation services for firms, with the goal to offer them digital and design solutions. Most of the firm's revenue comes from Software services segment.
HCL Technologies
HCL Technologies
Public Basket - Platforms
27
0.0x
0.5x
1.0x
1.5x
2.0x
2.5x
3.0x
3.5x
4.0x
Revenue Multiples - HCL Technologies
TEV/Revenue Average
0x
2x
4x
6x
8x
10x
12x
14x
16x
EBITDA Multiples - HCL Technologies
TEV/EBITDA (Analyst Normalized)Average
HCL Technologies
Company Name Date Deal Synopsis
Cisco (Self-Optimizing Network technology)
25-Oct-20The Self-Optimising Network business of Cisco Systems (NASDAQ: CSCO) was acquired by HCL Technologies (NSE: HCLTECH) for $50 million on October 25, 2020. The acquisition enables HCL Technologies to meet the growing needs of its customers in the telecommunications industry, which includes tier-one communications service providers globally.
DWS Group 21-Sep-20The company reached a definitive agreement to be acquired by HCL Technologies (NSE: HCLTECH) for AUD 162 million on September 21, 2020.
Public Basket - Platforms
28
BigCommerce Holdings Inc is a new era of ecommerce.
Its software-as-a-service (SaaS) platform simplifies the creation of beautiful, engaging online stores by delivering a combination of ease-of-use, enterprise functionality, and flexibility. The company powers both its customers' branded ecommerce stores and their cross-channel connections to popular online marketplaces, social networks, and offline point-of-sale systems. It operates in a single segment covering geographical areas of Americas - U.S.; Americas - other; EMEA; and APAC.
BigCommerce
BigCommerce
Public Basket - Platforms
29
BigCommerce
Company Name Date Deal Synopsis
Zing (Austin) 28-Apr-15The company was acquired by Bigcommerce for an undisclosed amount on April 28, 2015. Bigcommerce was backed by several VC investors.
0.0x
5.0x
10.0x
15.0x
20.0x
25.0x
30.0x
35.0x
40.0x
45.0x
50.0x
Revenue Multiples - BigCommerce
TEV/Revenue Average
Contact Info7MA 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]
John Cooper, Managing Director 704.973.3996 [email protected]
Mark Landry, Managing Director 561.972.0609 [email protected]
Tim Frye, Senior Director 704.973.3994 [email protected]
Kristina Sergueeva, Director 704.899.5149 [email protected]
Ben Garber, Vice President 412.626.7898 [email protected]
Garth Martin, Vice President 704.973.3997 [email protected]
Nicholas Prendergast, Vice President 704.973.3995 [email protected]
Ariail Barker, Director, Sales & Marketing 704.981.2908 [email protected]
Ben Bruggeworth, VP, Business Development 704.365.8859 [email protected]
Steve Sypek, VP, Business Development 704.414.8736 [email protected]
Emily Halstenberg, Marketing & Sales Manager 704.409.9912 [email protected]
Alexis Papa, Marketing & Sales Coordinator 704.414.8732 [email protected]
Marty Johnson, Senior Associate 704.973.3999 [email protected]
Sydney Scadden, Senior Associate 704.973.3998 [email protected]
Steve Buffington, Associate 704.960.1828 [email protected]
Ilia Ulianchuk, Senior Analyst 704.414.8743 [email protected]
Nic Anderle, Analyst 704.826.7492 [email protected]
Luke Perda, Analyst 704.851.4013 [email protected]
Robin Siegel, Analyst 704.285.8173 [email protected]
Conor Smith, Analyst 704.855.2134 [email protected]
Sawyer Willingham, Analyst 704.285.8171 [email protected]