SaaS & Cloud M&A and Valuation Update

M&A Excellence

SaaS & Cloud

M&A and Valuation Update

Q4 2013

Capstone Partners

Investment Banking Advisors

2012 AWARD WINNER:

GLOBAL INVESTMENT BANKING

BOUTIQUE FIRM OF THE YEAR

Over a Decade of M&A Excellence

Table of Contents

Section

Introduction

n Research Coverage: SaaS & Cloud n Key Takeaways

M&A Activity & Multiples

n M&A Dollar Volume

n M&A Transaction Volume

n 2013 Revenue Multiples

n Revenue Multiples by Segment

n Highest Revenue Multiple Transactions for 2013

n Notable M&A Transactions

n Most Active Buyers

Public Company Valuation & Operating Metrics

n SaaS & Cloud 105 Public Company Universe n Recent IPOs

n Stock Price Performance

n 2013 Revenue, EBITDA & P/E Multiples

n Revenue, EBITDA and EPS Growth

n Margin Analysis

n Best / Worst Performers

Notable Transaction Profiles

Public Company Trading & Operating Metrics

Technology & Telecom Team

Page

Capstone Partners

Investment Banking Advisors

Observations and

Recommendations

Over a Decade of M&A Excellence

n

Capstone’s Technology & Telecom Group focuses its research efforts on the following market segments:

Research Coverage: SaaS & Cloud

4 Analytics / Business Intelligence 4 Cloud & IT Infrastructure

4 Cloud Computing / Storage 4 Communication & Collaboration 4 Content Creation & Management 4 Content Delivery Services

4 CRM & Customer Service

4 ERP, Supply Chain & Commerce 4 Finance & Administration

4 Human Resources

4 Licensed Software Leaders 4 Marketing & Advertising 4 Vertical Markets

Mobile & Wireless Consumer Internet

Enterprise SaaS & Cloud

E-Commerce Consumer, IT &

M&A Excellence

Key Takeaways – M&A Activity & Multiples

n

2013 M&A Dollar Volume of $43B sets a new 5 year high with dollar volume above $35B each year since 2010

} Private dollar volume is down for 2013 relative to 2012 but remains strong

n

2013 transaction volume of 585 deals is up slightly from 2012 and represents a 5 year high

} Q4 saw 178 deals, a modest increase over 157 deals in Q3

} Vertical Market solutions and Cloud & IT Infrastructure constitute nearly half of all transactions with deal volume continuing to grow in those segments

n

The Median 2013 Revenue Multiple paid for private company targets rebounded to 4.0x in 2013 after

decreasing in 2011 and 2012

} Hot companies and sectors can see double digit multiple exits but those are the exception with most companies being acquired at more modest multiples

n

The Median 2013 Revenue Multiple paid for public company targets above $100M remained consistent at 3.3x

} Q2’13 through Q4’13 have seen strong multiples after a majority of Q1’13 deals came in below 2.0x

n

Notable M&A transactions in Q4

n

The most active buyers include Oracle, IBM, Cisco, Vista Equity Partners, Google, VMWare, Microsoft,

Perceptive Software, Salesforce.com and Solera

n

Capstone expects the robust M&A activity and attractive exit valuations to continue in SaaS & Cloud in 2014

} There is some risk that a significant market correction could negatively impact activity levels and valuation multiples

}Advent International / Unit 4($1.7B) }Monsanto / Climate Corp. ($930M) }IBM / Fiberlink ($300M)

}NCR / Digital Insight ($1.7B) }Experian / Passport Health ($850M) }CSC / Servicemesh ($295M)

}Oracle / Responsys ($1.6B) }NTT / Vertela ($525M)

Over a Decade of M&A Excellence

Key Takeaways – Public Company Metrics

n

Q4’13 saw 4 SaaS & Cloud IPOs added to the SaaS & Cloud 105 Universe

} Public offerings performed universally well, opening well above offer prices with strong early momentum

n

Median SaaS & Cloud 105 stock appreciation outperformed the NASDAQ in 2013 but underperformed in Q4

} Q4 lifted the SaaS & Cloud 105 median stock price by 7.6%, below the 10.7% increase for NASDAQ

n

Median 2013 Revenue Multiple of 5.0x marks a new five year high as the market momentum continues

} Medians range from 8.9x for ERP, Supply Chain & Commerce to a low of 1.6x for Content Delivery Services

n

Median EBITDA multiples rose sharply in 2013 and currently stand at 16.8x

} Finance & Administration, CRM & Customer Service, ERP, Supply Chain & Commerce and Human Resources trade at medians of over 30x

n

Median P/E multiples continue to rebound and now stand at a five year high of 28.1x

} ERP, Supply Chain & Commerce, CRM & Customer Service and Human Resources segments trade at medians of more than 50x earnings

n

Median Revenue growth was 19.4% in 2013 and is expected to slow to 16.3% in 2014

} The slow down in growth is driven largely by improved prior year numbers, as high growth rates are more difficult to maintain with a SaaS-based model as companies push to achieve greater scale

n

2013 Median EBITDA growth of 13.4% is up from 10.4% in 2012 but is expected to drop back to 12.0% in 2014

} More than half of the segments are expected to achieve greater than 10% EBITDA growth for 2014

n

Median gross margins have improved to 68.7%, a five year high, following the economic recovery

} Cloud & IT Infrastructure tops the list at 85.0% as newly emerging technologies that enable the cloud to run more efficiently command strong margins

Capstone Partners

Investment Banking Advisors

Observations and

Recommendations

M&A Activity &

Multiples

Over a Decade of M&A Excellence

2013 M&A Dollar Volume

n

2013 M&A Dollar Volume of $43B sets a new 5 year high with dollar volume above $35B each year since 2010

M&A Excellence

2013 M&A Transaction Volume by Segment

n

2013 transaction volume of 585 deals is up slightly from 2012 and represents a 5 year high

} Q4 saw 178 deals, a modest increase over 157 deals in Q3

n

Vertical Market solutions and Cloud & IT Infrastructure constitute nearly half of all transactions with deal volume

Over a Decade of M&A Excellence

2013 M&A Transaction Volume by Deal Size –

Private Targets

n

Private company deal volume rose significantly each year since 2009, with 563 deals in 2013 representing a five

year high

n

Median deal value rose slightly to $23M in 2013 from $20M in 2011 and 2012 although deal size mix has

Over a Decade of M&A Excellence

2013 M&A Transaction Volume by Deal Size –

Public Targets

n

Public transaction volume jumped in 2011 and has remained above 20 deals per year through 2013

} Median deal size fell to $286M in 2013 as there were fewer $500M-$1B deals in 2013 than 2012

} Deals over $250M represent more than half of the public deal volume since the beginning of 2010 with over 25% of deals above $1B

Over a Decade of M&A Excellence

Median 2013 Revenue Multiples – Private

Targets

n

The Median 2013 Revenue Multiple paid for private company targets rebounded to 4.0x in 2013 after

decreasing in 2011 and 2012

n

Hot companies and sectors can see double digit revenue multiple exits but those are the exception with most

Over a Decade of M&A Excellence

Median 2013 Revenue Multiples – Public

Targets

n

The Median 2013 Revenue Multiple paid for public company targets above $100M remained consistent at 3.3x

} Q2’13 through Q4’13 have seen strong multiples after a majority of Q1’13 deals came in below 2.0x

} With less than 25 public company target data points in a given year, the median multiple shows volatility, making it difficult to draw reliable conclusions on M&A valuation trends based on the data

Over a Decade of M&A Excellence

Median 2013 Revenue Multiples by Segment –

2008 to Current

n

Median Revenue Multiples for SaaS segments vary from just above 2.0x to 5.0x

} Marketing & Advertising, Analytics/Business Intelligence and Cloud & IT Infrastructure targets achieved median multiples at or above 4.0x as these companies are often acquired earlier in their revenue curve at strong multiples

} Cloud Computing/Storage and Content Delivery Services multiples lag as many acquisition targets have been unable to create highly differentiated products that command premium valuations

M&A Excellence

Highest Revenue Multiple Transactions for 2013

Excludes deals with Target company revenue less than $2M

Ann.

Date Buyer Target Segment Target Description Enterprise Value

LTM Revenue Multiple Multiple on $ Invested Premium to 1 Mo Prior

2/11/13 _{Infrastructure} Cloud & IT Provides storage virtualization capacity and performance management software for use in virtual server and desktop

environments for businesses. $185M 92.3x 8.3x NA

11/19/13 Computing / Cloud Storage

Provides cloud hosting, platform as a service (PaaS) and infrastructure as a service (IaaS) and server provisioning and cloud management

software for medium and large businesses and SaaS providers $150M 18.8x 8.1x NA

6/27/13 Marketing & _Advertising Provides marketing automation, social media marketing, mobile marketing, customer analytics and campaign management software

to businesses globally. $600M 10.3x 17.9x NA

2/14/13 Creation & Content Management

Develops and provides a compression-as-a-service based mobile video optimization browser/platform for wireless carriers and device

makers. $50M 10.2x 3.8x NA

1/7/13 _{Infrastructure} Cloud & IT Provides deep-packet inspection software that enables network hardware and software providers to add network traffic and

performance management features. $28M 9.5x NA NA

3/5/13 Vertical Market - _Healthcare Provides web-based electronic health records management software _{for the healthcare sector.} $235M 9.4x 3.9x NA

7/23/13 _{Infrastructure Provides intelligent cybersecurity technologies worldwide.} Cloud & IT $2.39B 8.9x NA 43.7%

8/20/13 _{Infrastructure} Cloud & IT Provides cloud-based intrusion detection, vulnerability assessment and _{security log management for businesses.} $300M 8.3x 6.3x NA

12/20/13 Marketing & _Advertising Provides email marketing campaign design, management and _{analytics software and SaaS for businesses} $1.6B 8.2x NA 66.3%

6/4/13 Marketing & _Advertising Provides email, mobile and social media marketing campaign creation, management and delivery software as a service (SaaS) for

Over a Decade of M&A Excellence

Notable M&A Transactions for Q4’13

Ann. Date Buyer Target Segment Target Description _Value Deal Revenue LTM

Multiple Multiple on $ Invested Premium to 1 Mo Prior

11/18/13 ERP, Supply Chain & Commerce

Provides ERP, HR and financial management software and SaaS for

businesses, education institutions and government agencies $1.7B 2.7x NA 12.4%

12/2/13 Vertical Market – Financial Services

Provides online and mobile online banking for consumers and payment processing SaaS for financial institutions and merchants

globally $1.7B 5.0x 1.6x NA

12/20/13 Marketing & _Advertising Provides email marketing campaign design, management and _{analytics software and SaaS for businesses} $1.6B 8.2x NA 66.3%

12/19/13 Vertical Market – Auto / Transportation

Provides automotive advertising and advertising enablement software

and SaaS for car dealerships in the US $994M 4.4x NA NA

10/2/13 Vertical Market – _Agriculture Provides weather monitoring and simulation and crop yield forecasting SaaS for farmers for the purpose of optimizing operating

and financing decisions $930M NA 8.4x NA

11/6/13 Vertical Market – _Healthcare Provides payment transaction management and processing software _{and software as a service (SaaS) for the medical sector} $850M 7.0x NA NA

10/28/13 _{Infrastructure} Cloud & IT Provides cloud-based wide area networking (WAN), software defined networking (SDN), network cost optimization and network monitoring

and analytics software and services $525M NA 5.4x NA

12/9/13 Content Delivery _Services Provides content delivery network, application deliver and Web _{content acceleration and optimization services for businesses globally $395M} 3.1x 5.3x NA

11/13/13 _{Infrastructure} Cloud & IT Provides mobile device and application management software and _{SaaS for small, medium and large businesses} $300M 6.0x 3.6x NA

10/30/13 _{Infrastructure} Cloud & IT Provides cloud application management, deployment, billing and _{cloud infrastructure management SaaS} $295M 7.4x 19.7x NA

M&A Excellence

Most Active SaaS/Cloud Buyers – Last 2 Years

# of Deals SaaS/Cloud Transactions

Company SaaS/Cloud Total Date Company Value Date Company Value

15 19 12/20/13 11/18/13 10/23/13 10/17/13 3/13/13 12/20/12 11/8/12 9/17/12 Responsys Bitzer Mobile BigMachines Compendium Nimbula Eloqua Instantis SelectMinds $1.7B NA NA $15M NA $956M NA NA 7/30/12 7/19/12 7/10/12 6/5/12 5/23/12 3/29/12 2/9/12 Xsigo Systems Skire Involver Collective Intellect Vitrue ClearTrial Taleo $220M NA NA NA $325M NA $1.9B 11 23 11/13/13 9/19/13 8/15/13 7/9/13 6/4/13 4/22/13 Fiberlink Communications Daeja Image Systems Trusteer CSL International SoftLayer Technologies Starbelly Productions $300M NA NA $20M $2.0B NA 2/1/13 9/24/12 8/27/12 5/2/12 4/13/12 Star Analytics Butterfly Software Kenexa TeaLeaf Technology Varicent Software NA NA $1.4B $500M $172M 10 21 12/17/13 7/23/13 6/20/13 3/25/13 11/18/12 Kibits Sourcefire Composite Software SolveDirect Meraki NA $2.4B $180M $21M $1.2B 11/15/12 10/4/12 9/26/13 5/3/12 3/28/12 Cloupia vCider ThinkSmart Technologies Truviso ClearAccess $125M NA $4M $20M NA 8 13 9/30/13 8/23/13 7/23/13 5/20/13

The Active Network Omnitracs

Digital Technology International Websense $1.1B $800M NA $1.1B 8/7/12 6/14/12 5/22/12 5/15/12 Consona Bullhorn

Silverchair Learning Systems Essential Learning NA NA NA NA 7 38 2/6/13 1/17/13 11/28/12 9/7/12 Channel Intelligence SurveyMonkey.com Incentive Targeting VirusTotal $125M $794M NA NA 7/31/12 6/5/12 6/4/12 Wildfire Interactive Quickoffice Meebo $350M NA $100M

Over a Decade of M&A Excellence

Most Active SaaS/Cloud Buyers – Last 2 Years

# of Deals SaaS/Cloud Transactions

Company SaaS/Cloud Total Date Company Value Date Company Value

6 7 10/15/13 2/11/13 7/23/12 Desktone Virsto Nicira Networks NA $185M $2.3B 7/2/12 5/22/12 4/24/12 DynamicOps Wanova Cetas Software NA NA NA 5 21 10/23/13 3/4/13 10/17/12 Apiphany MetricsHub MarketingPilot Software NA NA NA 10/16/12 6/15/12 StorSimple Yammer $1.2B NA 5 6 8/20/13 3/5/13 3/5/13 Perceptive Software Twistage AccessVia $72M NA NA 1/2/13

3/19/12 Acuo Technologies Nolij $45M $32M

5 13 11/18/13 6/4/13 2/6/13 Cloudconnect.com ExactTarget EntropySoft NA $2.4B NA 7/9/12

6/4/12 GoInstant Buddy Media $745M $70M

5 12 12/12/13 4/10/13 2/1/13

Distribution Service Technologies Eziworks HyperQuest NA NA NA 9/27/12

Capstone Partners

Investment Banking Advisors

Observations and

Recommendations

Public Company

Valuation &

Over a Decade of M&A Excellence

Enterprise SaaS & Cloud 105 Public Company

Universe – Pt. 1

Content Creation & Management Content Delivery Services CRM & Customer Service Communication & Collaboration

Over a Decade of M&A Excellence

Enterprise SaaS & Cloud 105 Public Company

Universe – Pt. 2

ERP, Supply Chain & Commerce Finance & Administration Human Resources Marketing & Advertising Vertical Markets Licensed Software Leaders

Over a Decade of M&A Excellence

Recent IPOs – Econtext

IPO Details

Offering Date: 12/18/13 Offering Price: $4.14

Original Range: $3.42-$4.14

Business Description

Provides online payment services and e-commerce solutions primarily in Japan.

Investors

Credit Saison; Digital Garage; JCB; Sumitomo Mitsui Card

Stock Performance thru End of Q4’13

IPO Performance

Financial & Valuation Metrics

LTM Revenue: $150.4M LTM EBITDA: $19.0M LTM Net Income: $8.4M Mkt Cap / $ Invested: 5.0x ’12-’13 Rev Growth: 136.9% Gross Margin: 26.9% EBITDA Margin: 13.4% Rev Multiple: 1.6x 12/31 $/share: $5.96 % Change to Offer: 44.0% % Change to Open: 41.9%

M&A Excellence

Recent IPOs – V-cube

IPO Details

Offering Date: 12/9/13 Offering Price: $31.98

Original Range: $29.07-$31.98

Business Description

Provides visual communication platform with a service of Web-based video conferencing to corporate users through cloud and on-premises license.

Investors

Globis Capital Partners; Intel Capital; Mitsubishi UFJ Capital; Mizuho Capital; Nissay Capital; Premiere Global Services; Recruit Incubation Partners

Stock Performance thru End of Q4’13

IPO Performance

Financial & Valuation Metrics

LTM Revenue: $25.4M E LTM EBITDA: $7.3M E LTM Net Income: $2.2M E Mkt Cap / $ Invested: NA LTM Rev Growth: NA Gross Margin: NA EBITDA Margin: NA Rev Multiple: 9.3x 12/31 $/share: $70.92 % Change to Offer: 121.8% % Change to Open: 45.7%

Over a Decade of M&A Excellence

Recent IPOs – Hottolink

IPO Details

Offering Date: 12/8/13 Offering Price: $26.29

Original Range: $25.02-$26.29

Business Description

Provides social media data and analytics engines through API in Japan. It also offers listening platform that enables customer to search and analyze massive social data interactive in real time.

Investors

Global Alliance; Hitachi Systems; Nomura Securities; OPT

Stock Performance thru End of Q4’13

IPO Performance

Financial & Valuation Metrics

LTM Revenue: $9.1M E LTM EBITDA: $2.0M E LTM Net Income: $0.8M E Mkt Cap / $ Invested: NA LTM Rev Growth: NA Gross Margin: NA EBITDA Margin: NA Rev Multiple: 32.6x 12/30 $/share: $223.03 % Change to Offer: 597.4% % Change to Open: 162.6%

M&A Excellence

Recent IPOs – Wix.com

IPO Details

Offering Date: 11/5/13 Offering Price: $16.50

Original Range: $14.50-$16.50

Business Description

Provides Web development, design, and management solutions and apps through an online platform that enables its user base of business, organizations,

professionals, and individuals to create a sophisticated and professional digital presence.

Investors

Benchmark Capital; Bessemer Venture Partners; DAG Ventures; Insight Venture Partners; Mangrove Partners; Mangrove II Investment Sarl

Stock Performance thru End of Q4’13

IPO Performance

Financial & Valuation Metrics

LTM Revenue: $68.8M LTM EBITDA: $(19.2M) LTM Net Income: $(21.2M) Mkt Cap / $ Invested: 33.1x LTM Rev Growth: 80.8% Gross Margin: 80.5% EBITDA Margin: (28.5)% Rev Multiple: 14.2x 12/31 $/share: $26.85 % Change to Offer: 62.7% % Change to Open: 45.1%

Over a Decade of M&A Excellence

Median Stock Performance – SaaS & Cloud

105

n

Median SaaS & Cloud 105 stock appreciation outperformed the NASDAQ in 2013 but underperformed slightly

in Q4

} Q4 lifted the SaaS & Cloud 105 median stock price by 7.8%, below the 10.7% increase for NASDAQ

n

Several segments posted double digit median gains over the past quarter with Marketing & Advertising and

Analytics / Business Intelligence posting median gains of nearly 15%

Over a Decade of M&A Excellence

Median 2013 Revenue Multiples – SaaS &

Cloud 105

n

Median 2013 Revenue Multiple of 5.0x marks a new five year high as the market momentum continues

n

Within SaaS & Cloud, median multiples vary considerably between segments

} Content Creation & Management, ERP, Supply Chain & Commerce, Finance & Administration and Human Resources segments command median multiples of more than 7x

} Content Delivery Services 2013 Revenue multiple stayed flat at 1.8x and represents the lowest multiple within SaaS & Cloud 105 primarily due to its lower margin profile

Over a Decade of M&A Excellence

Median 2013 EBITDA Multiples – SaaS & Cloud

105

n

Median EBITDA multiple rose sharply in 2013 and currently stands at 16.8x

n

Six of the SaaS & Cloud segments are trading at medians above 20x 2013 EBITDA

} Finance & Administration, CRM & Customer Service, ERP, Supply Chain & Commerce and Human Resources trade at over 30x

} The premium multiples for SaaS companies versus Licensed Software Leaders illustrates higher expected growth rates and the market’s preference for the more predictable recurring revenue business model

M&A Excellence

Median 2013 P/E Multiples – SaaS & Cloud 105

n

Median P/E multiples continue to rebound and now stand at a five year high of 28.1x for 2013

} P/E multiples rose in 2009 and 2010 amid investor confidence in an economic recovery, then fell during 2011 as companies achieved expected improvements in profitability

n

ERP, Supply Chain & Commerce, CRM & Customer Service and Human Resources segments trade at medians

of more than 50x earnings

Over a Decade of M&A Excellence

Median Revenue Growth – SaaS & Cloud 105

n

SaaS & Cloud 105 posted median revenue growth of 19.4% in 2013, though growth is expected to slow to 16.3%

in 2014

} The slow down in growth is driven largely by improved prior year numbers, as high growth rates are more difficult to maintain with a SaaS-based model as companies reach greater scale

M&A Excellence

Median EBITDA Growth – SaaS & Cloud 105

n

2013 Median EBITDA growth of 13.4% is up from 10.4% in 2012 but is expected to drop back to 12.0% in 2014

} EBITDA growth drop from 2011 high is more related to stronger prior period performance and increased OpEx spend than a weakening in total profit dollars

n

More than half of the segments are expected to achieve greater than 10% EBITDA growth for 2014

} ERP, Supply Chain & Commerce poor growth projection is due to three smaller companies that are investing heavily in growth and not yet at scale (Channel Advisor, E2Open and SLI Systems)

Over a Decade of M&A Excellence

Median EPS Growth – SaaS & Cloud 105

n

Median EPS growth increased to 14.8% in 2013 and is expected to retreat to 12.7% in 2014

} Improved prior period profits coupled with a return to investment in growth after several years of cost cutting results in lower EPS growth than 2010 and 2011

n

Majority of Human Resources companies’ growth based on reduced losses or turning profitable as only 2 out of

Over a Decade of M&A Excellence

Median Gross Margin Trends – SaaS & Cloud

105

n

Median gross margins have improved to 68.7%, a five year high, following the economic recovery

n

Cloud & IT Infrastructure tops the list at 85.0% as newly emerging technologies that enable the cloud to run

more efficiently command strong margins

n

The Finance & Administration segment median is being driven down by Xero which has not yet reached scale

Over a Decade of M&A Excellence

Median EBITDA Margin Trends – SaaS & Cloud

105

n

Median EBITDA margin remained constant at 17.6% as companies reinvest commensurate with growth

n

Several high growth companies in Human Resources and ERP, Supply Chain & Commerce continue to

invest heavily in sales and marketing and are early in the process of achieving scale and profitability

n

The License Software Leaders and other more mature segments like Cloud Computing / Storage already

M&A Excellence

Over a Decade of M&A Excellence

Best & Worst Performers – SaaS & Cloud 105

(Continued)

Capstone Partners

Investment Banking Advisors

Observations and

Recommendations

Notable

Transaction

Profiles

Over a Decade of M&A Excellence

M&A Transaction Spotlight

Deal Rationale/Commentary

UNIT4 is a Dutch software company that provides ERP, HR and financial management software and SaaS for businesses, educational institutions and government agencies worldwide. After the close of the transaction, UNIT4 will continue as an independent entity, keeping its corporate identity and brand.

Advent International is a VC and PE firm specializing in growth buyout, acquisitions, company succession, international expansion and strategic repositioning. With its acquisition of UNIT4, it hopes to accelerate the SaaS business and support its current offering of FinancialForce.com and expand its presence in the existing vertical and horizontal markets.

At a deal value of $1.7 billion, UNIT4 was valued at 2.7 times trailing revenues and 18.5 times trailing EBITDA, which 451 Group claims is on par with the median multiples for PE acquisitions in the business applications space for the last two years.

Deal Summary

Valuation Metrics

Note: LTM and Premiums of last quarter prior to transaction announcement date.

Acquiror

Target

Note: Transaction Value calculated as consideration paid to holders of stock and stock equivalents plus assumed debt.

M&A Excellence

Deal Rationale/Commentary

Digital Insight provides online banking for consumers and payment processing SaaS for merchants and financial institutions. It was formerly known as Intuit Financial Services and the division was sold to Thoma Bravo for $1.03 billion in June of 2013.

Generating a quick profit of $600 million in a mere six months, Thoma Bravo marks one of the more significant private equity flips in recent history. Many in the industry questioned why NCR failed to acquire the opportunity back in June prior to the Thoma Bravo deal, but analysts reported Intuit was seeking a fast closing process and the protocols for acquiring a company at NCR did not meet the time frame.

The deal will provide NCR a new source of customers, with more than two-thirds of Digital Insight’s 1000 financial institution customers not already using NCR’s services. Following the acquisition, which NCR CEO Bill Nuti describes as “a historic day for [the] company,” there will likely be fundamental changes to NCR’s financial service offerings and substantial enhancements to its mobile and online banking services.

At a deal value of $1.65 billion, it equates to 5 times trailing revenue, 55 times trailing EBITDA and a return of over half a billion dollars for Thoma Bravo.

Acquiror

Target

Deal Summary

Valuation Metrics

Trailing Revenue Multiple: 5.0x Trailing EBITDA Multiple: 55.0x Multiple on $ Invested: 1.6x

Investors

M&A Transaction Spotlight

Over a Decade of M&A Excellence

Deal Rationale/Commentary

Responsys provides email marketing campaigns design, management and analytics software and SaaS for businesses.

Having entered the cloud computing space late, Oracle has been focusing its efforts to bolster its cloud offerings by acquiring companies such as Nimbula, Compendium and BigMachines to name a few. The acquisition of Responsys marks Oracles seventh acquisition of the year. Responsys’ marketing software will be integrated into the Oracle Marketing Cloud; the combination of Responsys and Eloqua (acquired in 2012 for $960M) will likely bring forth a vastly featured marketing software, capable of delivering powerful and effective marketing campaigns.

The $27 per share offer amounts to a 38% premium over Responsys’ prior day closing price of $19.52, valuing the company at $1.5 billion. At an astonishing 7.7 times trailing revenues and 106.9 times trailing EBITDA, this deal marks Oracles second billion dollar plus acquisition for 2013. The deal has been approved by the board of directors of Responsys and Oracle expects the deal to close during the first half of 2014.

Many analysts and investors speculate Marketo may be next to get acquired, Marketo shares soared as high as 13% during trading hours.

Acquiror

Target

Deal Summary

M&A Transaction Spotlight

LTM Revenue Multiple: 8.2x LTM EBITDA Multiple: 119.7x Deal Value Per Employee: $1.4M Premium versus:

1 day prior: 38.3% 1 week prior: 39.8% 1 month prior: 66.3%

M&A Excellence

Deal Rationale/Commentary

Dealer.com provides automotive advertising and advertising enablement software and SaaS for car dealerships in the US. Products include website design software, Web hosting services, CRM SaaS, inventory management SaaS and search engine optimization, email, social media marketing and lead generation SaaS.

Dealer.com is owned by private-equity firms including Apax Partners LLP and Accel Partners. The Burlington, Vermont-based company provides online marketing and sale services to 7,000 car dealers in the U.S. This the largest acquisition by New York-based Dealertrack, according to Bloomberg. The company has spent about $461 million on 19 takeovers. Under the terms of the agreement, Dealertrack will pay 8.7 million shares of Dealertrack’s common stock and $620 million in cash, subject to customary post-closing adjustments. Dealertrack expects to finance the cash portion of the purchase price through a combination of cash on hand and already-committed debt financing. The deal is expected to close in the first quarter of 2014, and the transaction values Dealer.com around 20x 2013 EBITDA.

Acquiror

Target

Deal Summary

Date: 12/19/2013

Transaction Value: $994M % Sought: 100%

Consideration: Cash, Equity

Valuation Metrics

Trailing Revenue Multiple: 4.4x Trailing EBITDA Multiple: 19.9x Multiple on $ Invested: NA

Investors

M&A Transaction Spotlight

Over a Decade of M&A Excellence

Deal Rationale/Commentary

The Climate Corporation provides weather monitoring and simulation and crop yield forecasting SaaS for farmers for the purpose of optimizing operating and financing decisions. It also provides a full-season weather insurance program that protects farmers against financial loss due to bad weather. The company was formerly known as WeatherBill and changed its name to The Climate Corporation in 2011.

The agricultural biotech giant Monsanto provides chemicals, herbicides, pesticides, genetically modified seeds and general agricultural biotechnology product for businesses in the agriculture space. The acquisition of The Climate Corporation is its first tech acquisition, but Monsanto has been very acquisitive, making this deal their 6th _{acquisition of} the year.

With four rounds of funding, The Climate Corporation raised over $110 million in the span of 6 years. The deal value of $930 million equates to 8.4 times total amount of dollar invested, delivering a big payday for its investors.

Acquiror

Target

Deal Summary

Valuation Metrics

Trailing Revenue Multiple: NA Trailing EBITDA Multiple: NA Multiple on $ Invested: 8.4x

Investors

M&A Transaction Spotlight

Allen & Company; Anthemis Group; Atomico Investment Holdings; Code Advisors; Felicis Ventures; First Round Capital, Glynn Capital Management; Google Ventures; Index Ventures; Juvo Capital; Khosla Ventures; Nephila Capital; NEA; The Founders Fund; Western Technology

M&A Excellence

Deal Rationale/Commentary

Passport Health Communications provides payment transaction management and processing software and SaaS for hospitals and health care providers. Its software, eCare Patient Access Suite and OrderChecker offer various features including customer billing & EDI, compliance and data management. It currently serves more than 2,500 hospitals and 9,000 other health care providers, processing more than 300 million health care transactions annually. Experian provides financial credit data and analytical tools for businesses and consumers globally. With its acquisition of Passport Health, it greatly expanded its presence in the healthcare industry and tripled its healthcare business in terms of revenue, expecting to add $121 million this year. The deal value of $850 million, equating to 7 times projected 2013 revenue, represents a strong multiple for a revenue cycle management company. Suspending its planned $500 million share buyback for this acquisition did not go unnoticed by Experian investors, after shares dropped by more than 7% following the announcement. However, Experian plans to pay an interim dividend of 11.5 cents per share, up 7%.

Acquiror

Target

Deal Summary

Valuation Metrics

Projected Revenue Multiple: 7.0x LTM P/E Multiple: N/A

Multiple on $ Invested: N/A

Investors

Anvers; Ares Capital Corporation; CB Health Ventures; Coleman Swenson Booth; Evergreen Investments and Management; Goldman Sachs Specialty Lending Group; Great Hill Partners; Passport Holding; Primus; Select Capital Venture; Spectrum Equity Investors

M&A Transaction Spotlight

(1) Calculated as consideration paid to holders of equity linked securities plus assumed debt.

Over a Decade of M&A Excellence

Deal Rationale/Commentary

Virtela Technology Services provides cloud-based wide area networking (WAN), software defined networking (SDN), network cost optimization and network monitoring and analytics software and services. The company also provides managed IT infrastructure monitoring and private and public cloud, virtualization, compute as a service and SDN orchestration, management and enablement services. NTT Communications is a major telecom and hosted services provider in Japan. The acquisition of Virtela makes it the company’s seventh acquisition of the year and gives the company a more robust networking services portfolio, complementing its efforts to offer SDN capabilities.

Virtela is backed by Juniper Networks along with several well-known VC firms and has raised $97.5 million in funding across four rounds. The deal value of $525 million equates to 5.4 times total dollars invested, most likely providing a solid return for investors.

Acquiror

Target

Deal Summary

Valuation Metrics

Projected Revenue Multiple: NA LTM P/E Multiple: N/A

Multiple on $ Invested: 5.4x

Investors

Juniper Networks; New Enterprise Associates; Newton Technology Partners; North Coast Technology Investors; Norwest Venture Partners; Palomar Ventures; RSA Ventures; Symantec

M&A Excellence

Deal Rationale/Commentary

EdgeCast Networks operates a content delivery network (CDN) and provides application delivery, Web content acceleration and optimization services for businesses globally. The company was founded in 2006 and has become one of the fastest growing Internet companies in the world. Edgecast has more than 6,000 accounts and serves some of the world’s leading web brands for global media delivery and acceleration services, such as LinkedIn, Twitter, Yahoo! and Pinterest.

With Verizon’s recent acquisition of upLynk last month, the acquisition of EdgeCast shows Verizon’s effort to enhance its Digital Media Services unit. EdgeCast will allow Verizon to speed up its delivery of video services and augment upLynk’s streamlined process for uploading and encoding live and on-demand video content for multi-platform delivery.

EdgeCast has raised a total of $74 million in funding from various angel and institutional investors. The deal value of $395 million equates to 3.1 times trailing revenues and 5.3 times dollars invested.

Acquiror

Target

Deal Summary

Valuation Metrics

Trailing Revenue Multiple: 3.1x* Trailing EBITDA Multiple: NA Multiple on $ Invested: 5.3x*

Investors

M&A Transaction Spotlight

Angels; Menlo Ventures; Performance Equity

Management; Silicon Valley Bank, Steamboat Ventures

(*) Estimate from Capstone research & industry sources

Over a Decade of M&A Excellence

Deal Rationale/Commentary

Fiberlink provides cloud-based enterprise mobile device security and application management software. Fiberlink is an established mobile device management (MDM) provider with more than 3,500 customers ranging from small businesses to enterprise and government agencies.

The company’s solution, offered under the brand MaaS360, enables end-to-end security, device and application management for the rapidly expanding bring your own device (BYOD) trend in the enterprise.

This is IBM’s eighth acquisition within the past 18 months, with plans to offer Fiberlink’s MaaS360 on the IBM SoftLayer cloud infrastructure. The deal demonstrates IBM’s intent to boost its mobile offerings and provide a comprehensive, cloud-based MDM solution that can accelerate productivity for its customers.

With an estimated value of $300 million, the deal amounts to 6 times trailing revenue and 3.6 times the aggregate dollars invested. This is a solid revenue multiple given the MDM space is crowded and is consolidating rapidly. Taken with other significant acquisitions by Citrix (Zenprise), LANDesk (WaveLink) and Symantec (Odyssey & Nukona), IBM’s acquisition of Fiberlink continues the consolidation trend in the MDM market.

Acquiror

Target

Deal Summary

Valuation Metrics

Trailing Revenue Multiple: 6.0x(1)

LTM P/E Multiple: N/A

Multiple on $ Invested: 3.6.x(1)

Investors

Edison Venture Fund; GE Equity; Goldman Sachs Group; NewSpring Capital; Strattech Partners; Technology Crossover Ventures

M&A Transaction Spotlight

(1) Estimate from Capstone research & industry sources

M&A Excellence

Deal Rationale/Commentary

ServiceMesh provides cloud application management, deployment, billing and cloud infrastructure management SaaS for businesses. Its cloud management platform automates the deployment and management of enterprise applications across private, public and hybrid cloud environments. This enables companies to centralize management while allowing various applications to run in different clouds to maximize flexibility and performance. Computer Sciences Corporation provides systems and security integration, business process outsourcing and Web and application hosting services for businesses internationally. With its acquisition of ServiceMesh, CSC will be able to provide modern cloud application management technologies to its robust government agency clients, allowing them to run applications on public, private and hybrid clouds. Adding to its earlier acquisition of Infochimps, CSC is clearly looking to transition beyond its traditional IT outsourcing history.

The transaction value of $295 million includes the potential earnout of $137 million which will be based on certain performance milestones. If the full earnout is realized, the deal will result in premium multiples at 7.4x LTM revenue and a 19.7x multiple on the $15M invested.

Acquiror

Target

Deal Summary

Valuation Metrics

LTM P/E Multiple: N/A

Multiple on $ Invested: 19.7x ; 10.5x(2)

Investors

M&A Transaction Spotlight

(1) Includes $137M earnout. Calculated as consideration paid to holders of equity linked securities plus assumed debt.

(2) Multiples shown with and without earnout. Multiple on $ invested calculated as Transaction Value / Total $ Invested

Over a Decade of M&A Excellence

Capstone Partners

Investment Banking Advisors

Observations and

Recommendations

Public Company

Trading & Operating

Metrics

M&A Excellence

Trading & Operating Metrics

*Sorted alphabetically within market segment

($ in millions, except per share data)

$/Share Market Enterprise % Change Ent. Value/Rev. Ent. Value/EBITDA Price/EPS NTM / LTM Growth LTM Margin

Company Name 12/31/13 Cap Value Cash Debt LTM LQ LTM NTM LTM NTM LTM NTM Revenue EBITDA EPS Gross EBITDA Net

SaaS & Cloud 105 Mean 18,984 18,167 3,173 2,356 60.0 % 8.2 % 8.3 x 6.3 x 27.4 x 24.0 x 46.3 x 36.8 x 20.2% 14.7% 16.6% 66.3 % 13.3 % 4.8 % SaaS & Cloud 105 Median 1,413 1,305 107 8 50.7 % 7.8 % 5.0 x 4.4 x 16.8 x 15.4 x 28.1 x 24.1 x 16.3% 12.0% 12.7% 68.7 % 17.6 % 8.8 % Analytics / Business Intelligence

Adobe 59.88 29,933 28,273 3,174 1,514 58.9 % 15.3 % 7.0 x 6.9 x 25.6 x 26.7 x 44.4 x 53.7 x 0.5% (4.0)% (17.4)% 85.5 % 27.2 % 17.1 % Bazaarvoice 7.92 601 526 75 0 (15.3)% (12.7)% 3.0 x 2.7 x NA NA NA NA 9.0% 47.5% 25.3% 67.9 % (10.6)% (12.1)% comScore 28.61 1,021 960 80 19 107.6 % (1.2)% 3.4 x 3.1 x 17.4 x 15.4 x 28.0 x 23.3 x 9.7% 13.4% 20.3% 67.9 % 19.8 % 12.5 % Google 1,120.71 374,415 326,816 54,739 7,140 58.4 % 27.9 % 5.7 x 4.9 x 15.8 x 13.2 x 26.4 x 22.6 x 16.2% 19.5% 16.8% 57.3 % 36.0 % 25.0 % Splunk 68.67 7,366 7,014 352 0 136.6 % 14.4 % 26.2 x 19.4 x NA NA NA NA 35.1% NA NA 89.1 % 1.4 % (1.5)% Mean 82,667 72,718 11,684 1,735 69.3 % 8.7 % 9.1 x 7.4 x 19.6 x 18.4 x 32.9 x 33.2 x 14.1% 19.1% 11.3% 73.6 % 14.8 % 8.2 % Median 7,366 7,014 352 19 58.9 % 14.4 % 5.7 x 4.9 x 17.4 x 15.4 x 28.0 x 23.3 x 9.7% 16.4% 18.6% 67.9 % 19.8 % 12.5 % Cloud & IT Infrastructure

Citrix 63.25 11,790 11,095 695 0 (3.6)% (10.4)% 3.9 x 3.5 x 13.8 x 11.5 x 22.0 x 19.5 x 10.5% 20.0% 12.9% 86.5 % 28.1 % 19.0 % Covisint 12.55 469 468 1 0 NA (2.2)% 4.8 x 4.2 x NA NA NA NA 12.8% 101.8% 2.6% 45.8 % (19.4)% (11.1)% LogMeIn 33.55 813 613 199 0 49.7 % 8.1 % 3.9 x 3.3 x 17.5 x 16.6 x 53.3 x 47.6 x 16.1% 5.7% 11.9% 88.7 % 22.1 % 9.8 % Proofpoint 33.17 1,191 1,122 72 3 169.5 % 3.3 % 8.9 x 7.2 x NA NA NA NA 23.4% NA 2.5% 70.5 % (4.6)% (9.7)% Qualys 23.11 745 646 101 1 56.3 % 8.0 % 6.2 x 5.3 x 40.9 x 30.3 x 110.0 x 94.4 x 18.3% 34.7% 16.6% 77.7 % 15.2 % 7.2 % Rally Softw are 19.45 475 380 95 0 NA (35.1)% 5.4 x 4.4 x NA NA NA NA 23.7% 8.6% 72.3% 78.1 % (20.9)% (58.7)% Red Hat 56.04 10,620 9,653 967 0 5.8 % 21.5 % 6.5 x 5.7 x 23.7 x 20.2 x 38.6 x 36.0 x 14.1% 17.5% 7.4% 84.8 % 27.5 % 18.9 % ServiceNow 56.01 7,771 7,551 220 0 86.5 % 7.8 % 20.2 x 13.5 x NA 116.3 x NA NA 49.2% NA NA 62.5 % 5.0 % (2.1)% SolarWinds 37.83 2,843 2,637 206 0 (27.9)% 7.9 % 8.5 x 6.8 x 15.4 x 15.5 x 23.9 x 25.9 x 24.1% (0.1)% (7.4)% 92.3 % 54.8 % 38.8 % Splunk 68.67 7,366 7,014 352 0 136.6 % 14.4 % 26.2 x 19.4 x NA NA NA NA 35.1% NA NA 89.1 % 1.4 % (1.5)% VMw are 89.71 38,608 33,221 5,837 450 (4.7)% 10.9 % 6.6 x 5.8 x 17.4 x 14.6 x 28.2 x 24.3 x 14.1% 19.1% 16.0% 85.5 % 38.1 % 27.5 % WANdisco 20.38 482 476 5 0 184.9 % 10.9 % 71.9 x 39.4 x NA NA NA NA 82.6% 46.0% 55.5% 85.3 % (162.4)% (224.8)% Mean 6,931 6,240 729 38 65.3 % 3.7 % 14.4 x 9.9 x 21.5 x 32.1 x 46.0 x 41.3 x 27.0% 28.2% 19.0% 78.9 % (1.2)% (15.6)% Median 2,017 1,880 203 0 53.0 % 8.0 % 6.6 x 5.8 x 17.5 x 16.6 x 33.4 x 30.9 x 20.8% 19.1% 12.4% 85.0 % 10.1 % 2.8 % Cloud Computing / Storage

Amazon 398.79 182,540 177,894 7,689 3,043 59.0 % 27.6 % 2.5 x 2.1 x NA NA NA NA 22.6% 41.9% NA 26.6 % 6.3 % 0.2 % CenturyLink 31.85 18,826 39,142 266 20,582 (18.6)% 1.5 % 2.2 x 2.2 x 5.2 x 5.5 x 11.6 x 12.8 x (1.0)% (5.5)% (9.2)% 61.3 % 41.4 % 9.2 % Google 1,120.71 374,415 326,816 54,739 7,140 58.4 % 27.9 % 5.7 x 4.9 x 15.8 x 13.2 x 26.4 x 22.6 x 16.2% 19.5% 16.8% 57.3 % 36.0 % 25.0 % IBM 187.57 203,674 229,581 10,273 36,180 (2.1)% 1.3 % 2.3 x 2.3 x 8.9 x 7.8 x 11.5 x 10.6 x (0.6)% 13.3% 8.5% 48.7 % 25.6 % 18.0 % Microsoft 37.41 312,297 248,888 79,934 16,525 40.1 % 12.4 % 3.1 x 2.9 x 7.6 x 8.2 x 13.6 x 14.0 x 6.4% (6.8)% (3.2)% 73.6 % 40.7 % 29.0 % Oracle 38.26 172,071 159,238 36,999 24,166 14.8 % 15.3 % 4.2 x 4.1 x 8.7 x 8.2 x 13.7 x 12.6 x 4.7% 6.5% 8.6% 81.6 % 48.8 % 35.1 % Rackspace 39.13 5,471 5,274 270 73 (47.3)% (25.8)% 3.6 x 3.1 x 10.5 x 9.5 x 58.4 x 61.8 x 16.0% 9.8% (5.5)% 71.9 % 34.0 % 6.5 % salesforce.com 55.19 33,280 35,034 704 2,458 31.3 % 6.3 % 9.3 x 7.1 x 58.0 x 45.0 x 135.4 x 132.3 x 30.8% 28.8% 2.4% 76.6 % 16.1 % 6.4 % Verizon 49.14 140,540 182,323 57,357 99,140 13.6 % 5.3 % 1.5 x 1.5 x 4.5 x 4.1 x 19.2 x 14.7 x 4.1% 9.7% 30.2% 61.5 % 34.1 % 6.2 % Mean 160,346 156,021 27,581 23,256 16.6 % 8.0 % 3.8 x 3.3 x 14.9 x 12.7 x 36.2 x 35.2 x 11.0% 13.0% 6.1% 62.1 % 31.4 % 15.1 % Median 172,071 177,894 10,273 16,525 14.8 % 6.3 % 3.1 x 2.9 x 8.8 x 8.2 x 16.4 x 14.4 x 6.4% 9.8% 5.5% 61.5 % 34.1 % 9.2 %

Over a Decade of M&A Excellence

Trading & Operating Metrics

*Sorted alphabetically within market segment

($ in millions, except per share data)

$/Share Market Enterprise % Change Ent. Value/Rev. Ent. Value/EBITDA Price/EPS NTM / LTM Growth LTM Margin

Company Name 12/31/13 Cap Value Cash Debt LTM LQ LTM NTM LTM NTM LTM NTM Revenue EBITDA EPS Gross EBITDA Net

Communication & Collaboration

8x8 10.15 869 808 61 0 37.5 % 0.8 % 6.8 x 5.7 x 43.8 x 49.0 x 48.3 x 67.3 x 20.0% (10.6)% (28.1)% 70.0 % 15.6 % 13.4 % Cisco 22.43 119,925 87,950 48,201 16,226 14.2 % (4.3)% 1.8 x 1.9 x 5.4 x 5.5 x 10.8 x 11.4 x (5.5)% (1.7)% (5.2)% 61.1 % 33.3 % 22.9 % Citrix 63.25 11,790 11,095 695 0 (3.6)% (10.4)% 3.9 x 3.5 x 13.8 x 11.5 x 22.0 x 19.5 x 10.5% 20.0% 12.9% 86.5 % 28.1 % 19.0 % CounterPath 1.08 46 36 9 0 (46.1)% (25.8)% 2.9 x 2.2 x NA NA NA NA 28.6% 61.8% 50.0% 82.5 % (30.1)% (26.4)% Cybozu 3.99 192 152 39 0 40.3 % 33.2 % 2.9 x NA 16.7 x NA 2.1 x NA NA NA NA 92.0 % 17.5 % 173.5 % Interactive Intel. 67.36 1,362 1,279 83 0 100.8 % 6.1 % 4.3 x 3.8 x 35.9 x NA 85.3 x NA 12.5% (33.1)% (39.0)% 64.8 % 12.0 % 5.7 % IntraLinks 12.11 670 666 79 75 96.3 % 37.6 % 2.9 x 2.8 x 17.0 x 16.8 x NA NA 2.0% 0.9% NA 72.5 % 17.1 % 3.8 % j2 Global 50.01 2,293 2,232 307 246 63.4 % 1.0 % 4.6 x 4.1 x 10.2 x 9.5 x 18.2 x 17.3 x 11.4% 6.4% 5.1% 82.8 % 45.3 % 26.0 % Jive Softw are 11.25 779 672 116 9 (22.6)% (10.0)% 4.8 x 3.9 x NA NA NA NA 22.6% 72.9% 7.8% 62.0 % (14.5)% (25.7)% LivePerson 14.82 802 725 77 0 12.8 % 57.2 % 4.2 x 3.7 x 32.4 x 30.7 x 61.8 x 61.6 x 12.0% 5.7% 0.3% 76.1 % 12.9 % 7.6 % Microsoft 37.41 312,297 248,888 79,934 16,525 40.1 % 12.4 % 3.1 x 2.9 x 7.6 x 8.2 x 13.6 x 14.0 x 6.4% (6.8)% (3.2)% 73.6 % 40.7 % 29.0 % Premiere Global 11.59 537 725 37 225 18.5 % 16.4 % 1.4 x 1.3 x 8.0 x 7.2 x 15.1 x 14.2 x 7.2% 10.3% 6.1% 57.0 % 17.6 % 7.0 % RingCentral 18.37 1,143 1,156 25 38 NA 1.9 % 7.8 x 6.2 x NA NA NA NA 26.0% 17.4% 56.6% 61.7 % (18.6)% (48.5)% Textura 29.94 737 621 128 12 NA (30.5)% 17.5 x 10.5 x NA NA NA NA 67.2% 69.7% 74.7% 66.9 % (86.0)% (78.5)% Mean 32,389 25,500 9,271 2,383 29.3 % 6.1 % 4.9 x 4.1 x 19.1 x 17.3 x 30.8 x 29.3 x 17.0% 16.4% 11.5% 72.1 % 6.5 % 9.2 % Median 836 767 81 10 28.0 % 1.5 % 4.0 x 3.7 x 15.2 x 10.5 x 18.2 x 17.3 x 12.0% 6.4% 5.6% 71.2 % 16.4 % 7.3 % Content Creation & Management

Adobe 59.88 29,933 28,273 3,174 1,514 58.9 % 15.3 % 7.0 x 6.9 x 25.6 x 26.7 x 44.4 x 53.7 x 0.5% (4.0)% (17.4)% 85.5 % 27.2 % 17.1 % Destiny Media 2.01 104 103 2 0 207.8 % (4.0)% 27.9 x 20.2 x 254.0 x 64.2 x 468.5 x NA 38.6% 295.4% NA 100.0 % 11.0 % 6.2 % Kudelski 15.27 821 958 86 223 46.7 % 12.3 % 1.1 x 1.0 x 8.2 x 6.7 x 26.9 x 14.0 x 12.2% 21.3% NA 71.5 % 13.1 % 4.3 % Rovi 19.69 1,983 2,683 691 1,391 27.6 % 2.7 % 4.4 x 4.4 x 10.5 x 10.2 x 10.9 x 10.0 x 1.2% 2.7% 8.9% 82.4 % 42.3 % 29.5 % Sumavision 3.27 1,098 867 232 0 23.8 % (24.7)% 10.9 x 6.8 x 28.3 x 10.4 x 35.4 x 18.1 x 60.5% 173.0% 96.1% 76.5 % 38.5 % 39.0 % Wix 26.85 983 975 13 5 NA NA 14.2 x 8.8 x NA NA NA NA 60.3% (15.7)% 72.7% 80.5 % (28.5)% (84.8)% Mean 5,820 5,643 700 522 73.0 % 0.3 % 10.9 x 8.0 x 65.3 x 23.6 x 117.2 x 23.9 x 28.9% 78.8% 40.1% 82.7 % 17.3 % 1.9 % Median 1,041 966 159 114 46.7 % 2.7 % 8.9 x 6.9 x 25.6 x 10.4 x 35.4 x 16.0 x 25.4% 12.0% 40.8% 81.5 % 20.2 % 11.6 % Content Delivery Services

Akamai 47.18 8,444 7,878 566 0 15.3 % (8.7)% 5.2 x 4.6 x 11.6 x 10.7 x 23.5 x 23.0 x 13.0% 8.7% 2.1% 73.4 % 44.6 % 24.0 % Brightcove 14.14 407 373 34 0 56.4 % 25.7 % 3.6 x 3.1 x NA NA NA NA 15.2% NA NA 67.0 % 2.6 % (3.0)% Digital Generation 12.74 357 683 60 386 16.8 % (1.5)% 1.8 x 1.7 x 5.4 x 5.6 x 9.6 x 9.5 x 3.1% (3.5)% 1.5% 64.5 % 33.0 % 9.6 % Digital River 18.47 618 341 581 305 28.4 % 3.4 % 0.8 x 0.9 x 10.0 x 7.7 x 28.4 x 38.1 x (6.2)% 30.0% (25.5)% 80.3 % 8.5 % 5.3 % Limelight 1.98 193 81 112 1 (10.8)% 2.6 % 0.5 x 0.5 x 17.3 x NA NA NA (4.7)% NA (1.5)% 50.9 % 2.6 % (13.0)% Mean 2,004 1,871 271 138 21.2 % 4.3 % 2.4 x 2.2 x 11.1 x 8.0 x 20.5 x 23.5 x 4.1% 11.8% (5.8)% 67.2 % 18.3 % 4.6 % Median 407 373 112 1 16.8 % 2.6 % 1.8 x 1.7 x 10.8 x 7.7 x 23.5 x 23.0 x 3.1% 8.7% 0.0% 67.0 % 8.5 % 5.3 %

M&A Excellence

Trading & Operating Metrics

*Sorted alphabetically within market segment

($ in millions, except per share data)

$/Share Market Enterprise % Change Ent. Value/Rev. Ent. Value/EBITDA Price/EPS NTM / LTM Growth LTM Margin

Company Name 12/31/13 Cap Value Cash Debt LTM LQ LTM NTM LTM NTM LTM NTM Revenue EBITDA EPS Gross EBITDA Net

CRM & Customer Service

eGain 10.24 260 249 15 4 127.6 % (32.1)% 3.9 x 3.3 x NA NA NA NA 18.4% (32.7)% NA 69.9 % 5.9 % 2.1 % Jive Softw are 11.25 779 672 116 9 (22.6)% (10.0)% 4.8 x 3.9 x NA NA NA NA 22.6% 72.9% 7.8% 62.0 % (14.5)% (25.7)% LivePerson 14.82 802 725 77 0 12.8 % 57.2 % 4.2 x 3.7 x 32.4 x 30.7 x 61.8 x 61.6 x 12.0% 5.7% 0.3% 76.1 % 12.9 % 7.6 % salesforce.com 55.19 33,280 35,034 704 2,458 31.3 % 6.3 % 9.3 x 7.1 x 58.0 x 45.0 x 135.4 x 132.3 x 30.8% 28.8% 2.4% 76.6 % 16.1 % 6.4 % Mean 8,780 9,170 228 618 37.3 % 5.3 % 5.6 x 4.5 x 45.2 x 37.8 x 98.6 x 96.9 x 20.9% 18.7% 3.5% 71.2 % 5.1 % (2.4)% Median 791 698 97 7 22.1 % (1.8)% 4.5 x 3.8 x 45.2 x 37.8 x 98.6 x 96.9 x 20.5% 17.2% 2.4% 73.0 % 9.4 % 4.2 % ERP, Supply Chain & Commerce

ChannelAdvisor 41.71 946 868 90 13 NA 13.9 % 13.7 x 11.0 x NA NA NA NA 24.7% (265.7)% NA 73.2 % (8.3)% (1.1)% Demandw are 64.12 2,219 2,109 115 5 134.7 % 38.4 % 22.3 x 16.7 x NA NA NA NA 33.8% NA 31.1% 72.1 % (2.4)% (7.0)% E2open 23.91 634 621 17 4 68.9 % 6.7 % 8.9 x 7.6 x NA NA NA NA 17.2% (90.0)% (65.6)% 63.3 % (7.6)% (9.7)% econtext 0.77 384 244 141 0 NA NA 1.6 x NA 12.2 x NA NA NA NA NA NA 26.9 % 13.3 % 5.6 % SciQuest 28.48 676 649 27 0 79.6 % 26.8 % 7.7 x 6.0 x 35.6 x 31.8 x 86.3 x 74.4 x 29.1% 11.8% 16.0% 68.7 % 21.7 % 8.9 % SLI Systems 1.53 92 80 12 0 NA (6.1)% 4.4 x 4.2 x NA NA NA NA 5.2% (176.5)% 23.0% 8.1 % (9.7)% (13.9)% SPS Commerce 65.30 1,046 965 81 0 75.2 % (2.4)% 9.8 x 8.1 x 76.6 x 61.8 x 125.6 x 112.2 x 20.9% 24.0% 12.0% 69.6 % 12.7 % 8.3 % Mean 857 791 69 3 89.6 % 12.9 % 9.8 x 8.9 x 41.4 x 46.8 x 105.9 x 93.3 x 21.8% (99.3)% 3.3% 54.6 % 2.8 % (1.3)% Median 676 649 81 0 77.4 % 10.3 % 8.9 x 7.8 x 35.6 x 46.8 x 105.9 x 93.3 x 22.8% (90.0)% 16.0% 68.7 % (2.4)% (1.1)% Finance & Administration

Bottomline 36.16 1,330 1,275 196 141 37.0 % 29.7 % 4.9 x 4.1 x 48.5 x 20.3 x 28.9 x 28.6 x 19.6% 138.5% 1.3% 53.8 % 10.1 % 17.2 % Concur 103.18 5,784 5,598 833 647 52.8 % (6.6)% 10.3 x 8.2 x 49.0 x 49.2 x 96.2 x 147.1 x 25.8% (0.4)% (34.6)% 71.2 % 20.9 % 10.9 % Intuit 76.32 21,744 21,127 1,116 499 28.3 % 15.1 % 5.0 x 4.6 x 12.6 x 11.7 x 23.6 x 21.2 x 7.7% 7.9% 11.1% 86.7 % 39.7 % 23.0 % NetSuite 103.02 7,694 7,490 467 264 53.1 % (4.6)% 19.5 x 15.0 x 203.6 x 159.7 x NA NA 29.6% 27.5% NA 67.4 % 9.6 % 4.6 % Tangoe 18.01 689 650 42 4 51.7 % (24.4)% 3.6 x 3.1 x 22.6 x 18.3 x 28.1 x 24.1 x 16.4% 23.3% 16.8% 54.6 % 15.7 % 14.1 % Xero 26.60 3,344 3,279 65 0 324.0 % 68.6 % 100.4 x 55.7 x NA NA NA NA 80.2% (135.8)% (167.5)% 2.9 % (35.3)% (34.8)% Mean 6,764 6,570 453 259 91.2 % 13.0 % 23.9 x 15.1 x 67.3 x 51.8 x 44.2 x 55.2 x 29.9% 10.2% (34.6)% 56.1 % 10.1 % 5.8 % Median 4,564 4,438 332 202 52.3 % 5.3 % 7.6 x 6.4 x 48.5 x 20.3 x 28.5 x 26.3 x 22.7% 15.6% 1.3% 61.0 % 12.9 % 12.5 % Human Resources Benefitfocus 57.74 1,413 1,335 85 8 NA 17.5 % 13.8 x 10.9 x NA NA NA NA 26.6% (44.3)% 62.8% 42.5 % (18.9)% (21.2)% Callidus 13.73 618 646 34 62 202.4 % 49.7 % 6.0 x 5.3 x 69.5 x 43.2 x NA NA 13.9% 61.0% NA 53.7 % 8.7 % (1.7)% Cornerstone 53.31 2,774 2,761 232 219 80.5 % 3.6 % 16.6 x 11.4 x NA NA NA NA 45.1% NA 79.4% 70.7 % (1.9)% (8.3)% Halogen 12.38 268 210 58 0 NA (9.0)% 4.6 x 3.8 x NA NA NA NA 21.0% (80.8)% 58.1% 74.1 % (8.0)% (32.5)% Personal & Informatik 69.54 524 504 20 0 71.8 % 9.3 % 5.5 x NA 16.5 x NA 24.8 x NA NA NA NA 69.3 % 33.3 % 23.1 % Saba 12.25 365 351 15 1 40.2 % 20.8 % 2.9 x 2.4 x NA NA NA NA 19.4% 130.1% NA 62.9 % (8.0)% (3.7)% WageWorks 59.44 2,056 1,777 309 29 233.9 % 17.8 % 8.4 x 7.6 x 33.2 x 29.6 x 83.7 x 74.3 x 11.3% 12.0% 12.7% 63.7 % 25.4 % 10.9 % Workday 83.16 14,536 13,732 1,283 479 52.6 % 2.8 % 33.6 x 21.5 x NA NA NA NA 56.1% (22.3)% (8.9)% 61.1 % (15.1)% (23.3)% Mean 2,819 2,664 254 100 113.6 % 14.1 % 11.4 x 9.0 x 39.7 x 36.4 x 54.3 x 74.3 x 27.6% 9.3% 40.8% 62.3 % 1.9 % (7.1)% Median 1,015 991 71 18 76.1 % 13.4 % 7.2 x 7.6 x 33.2 x 36.4 x 54.3 x 74.3 x 21.0% (5.1)% 58.1% 63.3 % (4.9)% (6.0)%

Over a Decade of M&A Excellence

Trading & Operating Metrics

*Sorted alphabetically within market segment

($ in millions, except per share data)

$/Share Market Enterprise % Change Ent. Value/Rev. Ent. Value/EBITDA Price/EPS NTM / LTM Growth LTM Margin

Company Name 12/31/13 Cap Value Cash Debt LTM LQ LTM NTM LTM NTM LTM NTM Revenue EBITDA EPS Gross EBITDA Net

Licensed Software Leaders

IBM 187.57 203,674 229,581 10,273 36,180 (2.1)% 1.3 % 2.3 x 2.3 x 8.9 x 7.8 x 11.5 x 10.6 x (0.6)% 13.3% 8.5% 48.7 % 25.6 % 18.0 % Microsoft 37.41 312,297 248,888 79,934 16,525 40.1 % 12.4 % 3.1 x 2.9 x 7.6 x 8.2 x 13.6 x 14.0 x 6.4% (6.8)% (3.2)% 73.6 % 40.7 % 29.0 % Oracle 38.26 172,071 159,238 36,999 24,166 14.8 % 15.3 % 4.2 x 4.1 x 8.7 x 8.2 x 13.7 x 12.6 x 4.7% 6.5% 8.6% 81.6 % 48.8 % 35.1 % SAP 86.14 102,808 105,566 4,457 7,215 7.5 % 16.4 % 4.7 x 4.3 x 13.3 x 11.1 x 19.9 x 17.4 x 8.4% 19.8% 14.6% 72.2 % 35.0 % 22.8 % Mean 197,712 185,818 32,916 21,022 15.1 % 11.4 % 3.6 x 3.4 x 9.6 x 8.8 x 14.7 x 13.6 x 4.7% 8.2% 7.1% 69.0 % 37.5 % 26.2 % Median 187,872 194,409 23,636 20,346 11.1 % 13.9 % 3.7 x 3.5 x 8.8 x 8.2 x 13.6 x 13.3 x 5.6% 9.9% 8.6% 72.9 % 37.8 % 25.9 % Marketing & Advertising

Adobe 59.88 29,933 28,273 3,174 1,514 58.9 % 15.3 % 7.0 x 6.9 x 25.6 x 26.7 x 44.4 x 53.7 x 0.5% (4.0)% (17.4)% 85.5 % 27.2 % 17.1 % Bazaarvoice 7.92 601 526 75 0 (15.3)% (12.7)% 3.0 x 2.7 x NA NA NA NA 9.0% 47.5% 25.3% 67.9 % (10.6)% (12.1)% Callidus 13.73 618 646 34 62 202.4 % 49.7 % 6.0 x 5.3 x 69.5 x 43.2 x NA NA 13.9% 61.0% NA 53.7 % 8.7 % (1.7)% Constant Contact 31.07 953 845 107 0 118.6 % 31.2 % 3.1 x 2.7 x 20.4 x 15.2 x 49.3 x 33.7 x 12.9% 34.6% 46.3% 71.2 % 14.9 % 7.1 % Google 1,120.71 374,415 326,816 54,739 7,140 58.4 % 27.9 % 5.7 x 4.9 x 15.8 x 13.2 x 26.4 x 22.6 x 16.2% 19.5% 16.8% 57.3 % 36.0 % 25.0 % Jive Softw are 11.25 779 672 116 9 (22.6)% (10.0)% 4.8 x 3.9 x NA NA NA NA 22.6% 72.9% 7.8% 62.0 % (14.5)% (25.7)% Marin Softw are 10.24 334 229 112 7 NA (18.4)% 3.2 x 2.6 x NA NA NA NA 23.5% 12.9% 60.2% 58.6 % (39.2)% (64.2)% Marketo 37.07 1,430 1,297 141 8 NA 16.3 % 15.3 x 11.1 x NA NA NA NA 38.1% 25.4% 86.7% 58.5 % (42.8)% (119.5)% Millennial Media 7.27 772 651 121 0 (42.0)% 2.8 % 3.0 x 1.7 x NA NA NA NA 72.9% NA NA 41.2 % 3.1 % 1.1 % ReachLocal 12.71 353 268 86 0 (1.5)% 6.7 % 0.5 x 0.5 x 9.7 x 7.0 x 31.8 x 22.9 x 12.9% 38.0% NA 49.8 % 5.5 % 2.2 % NA NA NA NA NA NA NA NA NA NA NA NA NA NA NA NA NA NA NA NA Rocket Fuel 61.49 2,018 1,920 125 27 NA 14.4 % 9.8 x 5.5 x NA NA NA NA 80.4% 33.4% 56.2% 46.4 % (7.7)% (6.0)% Tremor Video 5.80 288 192 96 0 NA (37.2)% 1.5 x 1.4 x NA NA NA NA 7.9% NA 81.3% 44.0 % (1.9)% (22.2)% NA NA NA NA NA NA NA NA NA NA NA NA NA NA NA NA NA NA NA NA Yahoo! 40.44 41,024 39,240 1,830 46 103.2 % 21.9 % 8.2 x 8.7 x 24.6 x 25.9 x 29.8 x 25.4 x (5.5)% (5.0)% 17.4% 70.1 % 33.5 % 31.5 % Mean 34,886 30,890 4,674 678 51.1 % 8.3 % 5.5 x 4.5 x 27.6 x 21.9 x 36.3 x 31.7 x 23.5% 30.6% 38.1% 58.9 % 0.9 % (12.9)% Median 779 672 116 8 58.4 % 14.4 % 4.8 x 3.9 x 22.5 x 20.5 x 31.8 x 25.4 x 13.9% 33.4% 35.8% 58.5 % 3.1 % (1.7)%