A visual slide representation of some of the content from Exitround's Tech M&A Report from $0 to $100M, focusing on the "long-tail" of tech M&A. This was presented at Orange Fab's Demo Day for Season 2 companies in San Francisco.

1. Tech M&A Report $0 to $100M
Jacob Mullins
CEO & Founder, Exitround
@jacob
!
June 2014

2. Global M&A is
on FIRE
2014
• 33% increase to $599Bn, ’13
• Most active start since 2011
• TMT M&A highest share of Global
M&A since 2006
• Technology, highest value on
opening qtr by 55% increase, ‘13
*Source: Mergermarket M&A Trend Report: Q1 2014 (link)

3. Overall Tech
M&A
Landscape
• Mega-deals are < 1% by volume
< 1% deals 88% deals
*Source: Mergermarket M&A Trend Report: Q1 2014
**Source: Woodside Capital Partners “MASiV 2014: The M&A Silicon Valley Gathering Report”
• 88% of all deals are below $100M
Doesn’t mean you can’t make
money, in fact…

4. Exitround:
The Exit Curve
• More money does not equal higher exit
• Best return on capital: $2-3M & $5-10M raise
• Consumer ROI: 9.1x average | 4.8x median
• Enterprise ROI: 21.1x average | 7.5x median
*Source: Exitround “The Exit Curve: Exitround’s Report On Tech M&A” 2014; exitround.com/data
exitround.com/data

5. More capital ≠
Larger exit
• Co’s that raised $5M - $10M had
larger exits than raised $10 - $50M
• Co’s that raised $3M - $5M had lower
exits than those raised $1M - $3M
*Source: Exitround “The Exit Curve: Exitround’s Report On Tech M&A” 2014; exitround.com/data

6. The New
Venture/Seed
Investing
Landscape
• Seed investors can make solid return if invest
early at low valuations
• Among all companies, capital raised:
• $3.4M average
• $1.03M median
• 56.8% of exits (sub-$100M) are <$5M
• Most lucrative exits:
• $3M - $5M (17% of total)
• $10M - $20M (11% of total)
*Source: Exitround “The Exit Curve: Exitround’s Report On Tech M&A” 2014; exitround.com/data

7. Exit Sizes that
Generate Best
Returns
• Exit of $3M - $7M where returns increase
• Exits of <$2M tend to lose money
• On exits of $3M - $7M & $10M - $20M
avg dollar raised = $1M
• Same capital required to get $3M or
$20M exit
*Source: Exitround “The Exit Curve: Exitround’s Report On Tech M&A” 2014; exitround.com/data

8. Exits w Highest
Multiple ROI
• Multiples on total cash invested:
• Average = 13.6x
• Median = 5.0x
• Exits w highest multiples:
• $3M - $4M
• $6M - $7M
• $30M +*Source: Exitround “The Exit Curve: Exitround’s Report On Tech M&A” 2014; exitround.com/data

9. Length of Time
to Build
Successful Co
Significant exit value increase
after company is 4 years old
*Source: Exitround “The Exit Curve: Exitround’s Report On Tech M&A” 2014; exitround.com/data

10. Exiting under $100M
• Best exits from ROI perspective are raises $2M - $3M &
$5M - $10M
• 88% of all technology M&A happens under $100M
• 56.8% of early tech M&A happens under $5M
• Enterprise co’s have better returns by factor of 3x
• Significant increase in value after 4 years
• Full report at exitround.com/data
*Source: Exitround “The Exit Curve: Exitround’s Report On Tech M&A” 2014; exitround.com/data

11. exitround.com/data
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