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August 03, 2020 No Comments Author: Andy Jones

Private Equity Investing in SaaS Companies

Private equity platform investments in Software-as-a-Service companies increased significantly in 2020YTD as a percentage of all PE deals. Many SaaS companies have been less negatively impacted by the economic impacts of the coronavirus compared to other industries, both in terms of continued demand for their product or service as well as the agility to continuing operations, working from home. In many cases, SaaS companies have benefitted by the sudden change in industry dynamics.

June 01, 2020 No Comments Author: Andy Jones

Aged Private Equity Portfolio Companies – June 2020

The median holding period for private equity portfolio companies is currently 4.8 years, as reported in our recently updated portfolio company holding periods study.

Given this, it is reasonable to assume that portfolio companies held five years or longer might be good candidates/prospects for an exit.

Our M&A Research Database currently shows 218 portfolio companies that will reach the 5-year holding period milestone in the month of June, 2020. A few sample companies are presented below.

March 23, 2020 No Comments Author: Andy Jones

Private Equity Firms with Good Timing

In a previous data study titled “Smart, Contrarian Private Equity Firms”, I wrote about private equity firms with prescient timing during the last recession… those that exited at the peak, just before the last recession, and those PE firms that acquired new portfolio companies at the lower valuations of 2009-2010.

Today, we’ll look at private equity firms that exited portfolio companies in January and February (and a few in the first part of March) of 2020, just prior to the onslaught of the Coronavirus. Here are those firms:

February 24, 2020 No Comments Author: Andy Jones

Private Equity Investing in Data Analytics Companies

Data centric companies have become one of the most favored sectors for private equity investors in recent years. This trend started gaining momentum in 2011. Although private equity began exploring data analytics companies as an investment thesis in 2007 and 2008, the recession of 2009 – 2010 halted most PE investments across all sectors during this time.

The increased focus on data analytics companies is largely fueled by the adoption of predictive analytics (initially), and subsequently by machine learning and the rise in artificial intelligence. These applications require data (preferably good data) as the atomic input unit from which to learn. Input data informs machine learning much the same way our five senses input data into our brain, from which we derive patterns and develop predictive skills.

Data-as-a-product resonates with private equity investment preferences precisely because it is scalable, potentially quite profitable and not capital intensive (relative to scalability).

Private Equity Platform Investments in Data Analytics Companies