ENTERPRISE SOFTWARESECTOR UPDATE

2Q20

July 2020www.brentwoodcapital.com

103%

122%

150%

124%

11.8x

75%

100%

125%

150%

175%

Jun-19 Sep-19 Dec-19 Mar-20 Jun-20

$64 $71 $75

$69 $65 $67 $64 $65

$55 $59

481555 521 567

481 487538 527

422 428

0

200

400

600

$0

$20

$40

$60

$80

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2

2018 2019 2020$ Invested ($B) Deal Count

Sell-Side

Sell-Side Advisory to

Representative Software TransactionsIndustry Bankers

Select M&A Transactions

Middle-Market(1) Enterprise Software M&A TrendsLTM Enterprise Software Index vs. S&P & NASDAQ

Growth Equity

Equity Investment Led by

(1) Middle-market includes deal values of $25M - $1B.

John Kibler | Managing Director(615) 224-3825jkibler@brentwoodcapital.com

Cook Wylly | Director(615) 224-3829 cwylly@brentwoodcapital.com

Brentwood Capital Advisors LLC | 5000 Meridian Boulevard, Suite 350, Franklin, TN 37067 | Phone: (615) 224-3830

S&P 500SaaS Index SaaS Average TEV / NTM Revenue

Software stocks clawed back most of the losses sustained during 1Q20 and in many cases surpassed February levels, rising23% during 2Q20 and now up 14% YTD.

Public SaaS valuations have expanded 56% during the quarter from 7.9x to 11.8x TEV/NTM revenue, or 0.54x on a growth-adjusted basis.

In the wake of COVID-19, public market investors have sought out businesses with recurring revenue and strong balancesheets and are buying into the thesis that the pandemic has significantly accelerated businesses’ digital transformations.

Software M&A and capital raise activity during 2Q20 increased slightly from 1Q20 but decreased YOY, as most announceddeals were the result of processes kicked off pre-COVID-19 and few processes have gone to market during shelter-at-homeorders.

The deals BCA has seen moving ahead during 2Q20 have generally been between familiar parties (e.g. re-introductions, re-starts, "insider-plus" rounds, etc.); that is starting to change, and BCA expects deal activity to increase as business visibilityand financing terms improve.

NASDAQ Software Index

Brentwood Capital Advisors

2Q20 Enterprise Software Sector Overview

BCA Market Commentary

Ann. TEV/LTM TEV/NTM % RevenueDate Target Acquiror Target Business Description TEV ($M) Growth

6/23/20 Finicity Mastercard Cloud-based financial management platform. $985 N/A N/A N/A

6/2/20 Exostar Thoma Bravo Information sharing platform. $100 N/A N/A N/A

5/21/20 FMG Suite Aurora Capital Partners Cloud-based marketing automation software. N/A N/A N/A N/A

5/12/20 Conga Apttus Document automation platform designed for CRM. $715 8.5x N/A N/A

5/11/20 Eventbrite Francisco Partners Self-service ticketing and experience platform. $225 0.8x 1.3x (39.1%)

4/28/20 Docupace FTV Capital Digital data and compliance software. N/A N/A N/A N/A

4/20/20 Arxan CollabNet VersionOne Application protection solutions. N/A N/A N/A N/A

Revenue