1

MERGERS & ACQUISITIONS • CAPITAL RAISES • FINANCIAL & STRATEGIC ADVISORY

MARKETING TECH TRADING MULTIPLES

MAJOR INDICES & RATES

MARKETING TECH NEWS & TRENDS

MARKETING TECHNOLOGY MARKET UPDATE – Q3 & Q4 2017

The second half of 2017 continued the trend of a healthymarket for M&A and capital raises in Marketing Technology.The outlook is positive in 2018 for quality technologycompanies to pursue a sale of business or capital raise.Strategic buyers and private equity firms have recordamounts of cash to deploy and valuations remain attractive.All indications are positive for healthy M&A market in 2018despite public market volatility as investors adjust to newreality of higher economic growth combined with inflation.

Some notable activity within Marketing Technology:

▪ We advised DSG, which provides sales enablementservices, in its recapitalization with Stone-Goff Partners inQ4.

▪ CallRail raised $75 million at $160 million valuation in Q3from Sageview Capital and Leaders Fund. CallRail basedin Atlanta, is a phone call tracking and analytics platformused to understand which marketing campaigns driveleads and conversions.

▪ Our index of sales and marketing technology publiccompanies was up a whopping 54% in 2018 driving upthe revenue valuation multiple to 4.5 times.

▪ Salesforce.com stock price is up 32% since the end of Q2.Shares of the cloud-based software company have gainedon the back of impressive top line growth across differentbusiness segments.

We will be attending the MarTech conference at San JoseConvention Center from April 23 to 25th so let me know ifinterested in meeting while there.

Our 9th annual conference, CHILDSConnect, will be on May10th in Atlanta at The St. Regis. Last year over 400 owners,executives, and investors interested in middle market growthopportunities were in attendance. You can learn more andregister at www.childsadvisorypartners.com/childsconnect. Ihope to see you all there!

Scott Rhodes

Managing Director

Enterprise Value

LTM Revenue LTM EBITDA

Sales & Marketing Tech 4.49x 9.2x

Product & Supply Chain 4.65x 20.5x

% Change

3 Month 12 Month

Sales & Marketing Tech 169,191.03 11.9% 54.3%

Product & Supply Chain 101,467.29 2.3% 36.2%

Dow Jones 23,860.46 10.3% 25.1%

NYSE 12,270.65 4.9% 15.8%

NASDAQ 6,777.16 6.3% 28.2%

AMEX 2,496.07 0.8% 15.3%

S&P 500 2,581.00 6.1% 19.4%

Russell 2000 1,463.79 3.0% 13.1%

USD/Euro 0.83 (1.6%) (12.1%)

USD/Yen 112.64 0.0% (3.5%)

USD/Pound 0.74 (0.8%) (8.7%)

U.S. Prime Rate 4.500% 25.00 Bps 75.00 Bps

U.S. Treasury - 10 Year 2.400% 7.00 Bps (5.00 Bps)

LIBOR - 3 month 1.694% 36.04 Bps 69.64 Bps

Fed Funds Overnight Rate 1.330% 27.00 Bps 78.00 Bps

Close as of

12/31/2017

2

Provider of mobile app and desktop solutions to facilitate real-time dealer-to-dealer vehicle auctions

Enterprise Value: $175MMEV/Revenue: NDEV/EBITDA: ND

has acquired

Provider of sales and business intelligence software for the government

Enterprise Value: $70MMEV/Revenue: 2.7xEV/EBITDA: ND

has acquired

MARKETING TECH NOTABLE ACQUISITIONS

CHILDS Advisory Partners

Enterprise Value: $459MMEV/Revenue: 2.2xEV/EBITDA: ND

Provider of user generated content and marketing solutions

has acquired

Provider of predictive marketing software intended to empower agencies and marketers to anticipate people's need for products and services

Enterprise Value: $147MMEV/Revenue: 0.4xEV/EBITDA: ND

has acquired

Provider of outsourced sales training and enablement services

Enterprise Value: NDEV/Revenue: NDEV/EBITDA: ND

has acquired

Provider of omnichannel commerce technology

Enterprise Value: $820EV/Revenue: NDEV/EBITDA: ND

has acquired

3

Provider of account-based B2B marketing solutions for businesses worldwide

Amount Raised: $65.0MM

Investors:

MARKETING TECH NOTABLE CAP RAISES

CHILDS Advisory Partners

Provider of a content marketing automation platform

Provider of an online content marketing platform allowing B2B marketers to create, publish and measure interactive content

Provider of an online solution that enables product and support teams to understand the customer experience

Provider of an account-based marketing platform for B2B marketers

Amount Raised: $11.0MM

Investors:

Amount Raised: $10.2MM

Investors:

Amount Raised: $15.0MM

Investors:

Amount Raised: $10.3MM

Investors:

Provider of cloud-based software solutions for automated customer acquisition and behavioral marketing

Investors:

Amount Raised: $31MM

4

2.40x

2.49x 2.49x

2.26x

2.50x

2.40x

2.00x

2.10x

2.20x

2.30x

2.40x

2.50x

2.60x

2012 2013 2014 2015 2016 2017

EV/LTM Revenue

M&A ACTIVITY AND TRENDS

CHILDS Advisory Partners

EV/Revenue

SOFTWARE M&A VALUATIONS

Sources: Capital IQ, Gartner, Forrester, CHILDS proprietary database

U.S. MIDDLE MARKET SOFTWARE M&A ACTIVITY – QUARTERLY TRENDS

▪ M&A activity in the United States for middle marketsoftware companies slightly softened in Q3 and Q4 2017with 814 deals announced.

▪ Represents a 13% volume decline over theprevious 6 months and a 7% decline from thesame period last year.

▪ We expect the Tax Cuts and Jobs Act 2017 tohave an uncertain impact on the M&A market.On the positive side we expect an increase inGDP growth and there is no change in long termcapital gains rate. On the negative side, debtfinancing losing some tax advantage with newlimitations on the deductible of interestexpense.

▪ Opportunity for high quality growth deals to bewell received by buyers.

▪ Note, we define middle market as deals withenterprise value less than $1 billion.

▪ Valuations for publicly traded technology companiescontinue to increase.

▪ Revenue multiples for public MarketingTechnology companies increased slightly from4.24x to 4.49x. from Q2 to Q4.

SOFTWARE PUBLIC MARKET VALUATIONS

296 311331

308 326

387364 380

406377 380 393 377 384

344 356

411

351 342321

6677

8199

102

114

101102

106

107 87107

83 75

4662

54

6945

42

11

1110 27

23

16

1823

16

1619

20

20 17

16

18

11

14

23

19

1

67

1011

8

1016

10

814

14

9 7

14

18

11

1013

9374

405429

444462

525

493

521538

508 500534

489 483

420

454

487

444423

391

0

100

200

300

400

500

600

0

100

200

300

400

500

600

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4

2013 2014 2015 2016 2017

Undisclosed Less than $100M $100M - $499M $501M - $1,000M Deal Count

4.24x 4.23x

4.9x4.52x

4.23x

5.39x

4.49x 4.64x

5.49x

0.00x

1.00x

2.00x

3.00x

4.00x

5.00x

6.00x

Sales & Marketing Tech Enterprise Software SaaS

Q2 '17 Q3 '17 Q4 '17

5

EVENT DATES LOCATION

MarTech Today – West Apr. 23 – 25 San Jose, CA

MarTech Today – East Oct. 1 – 3 Boston, MA

Salesforce – Dreamforce Sept. 25 – 28 San Francisco, CA

CHILDS Advisory Partners

PUBLIC TRADING STATISTICS

Source: Capital IQ* Denotes figure excluded from mean calculation

SALES & MARKETING TECH

PRODUCT AND SUPPLY CHAIN

(USD in millions, except for stock price)

(USD in millions, except for stock price)

MARKETING TECHNOLOGY CONFERENCES [1]

[1]: Green font represents planned attendance by CHILDS Advisory Partners

Market Data Operating Statistics EV as a Multiple of: Growth

Stock Price LTM LTM CY2018 16 - '17

Company Name 12/31/17 Revenue EBITDA % Margin Revenue EBITDA Revenue EBITDA GrowthAverage

Adobe Systems Incorporated $175.24 94.1% $86,383.3 $82,445.0 $7,301.5 $2,494.1 34.2% 11.29x * 33.1x * 9.41x 21.0x 23.8% 20.8%

Salesforce.com, inc. $102.23 93.6% $73,840.7 $72,800.3 $9,923.0 $553.4 5.6% 7.34x 131.5x * 6.97x 32.7x * 24.4% 25.1%

Amdocs Limited $65.48 96.3% $9,423.5 $8,443.9 $3,890.1 $732.3 18.8% 2.18x 11.5x 2.13x 10.5x 3.7% 2.6%

HubSpot, Inc. $88.40 94.5% $3,303.6 $3,105.3 $345.5 ($35.9) (10.4%) 8.99x NM 6.56x 87.1x * 36.9% 49.2%

Callidus Software Inc. $28.65 93.6% $1,951.5 $1,775.1 $253.1 $0.2 0.1% 7.41x NM 5.93x 38.2x * 20.5% 22.8%

Criteo S.A. $26.03 46.5% $1,717.8 $1,386.8 $2,189.5 $203.8 9.3% 0.63x * 6.8x 1.52x 5.5x (48.5%) 41.9%

LivePerson, Inc. $11.50 76.2% $684.5 $630.2 $217.6 $11.4 5.3% 2.90x 55.1x * 2.70x 28.7x (2.1%) 3.1%

QuinStreet, Inc. $8.38 76.4% $383.1 $332.7 $335.6 $11.3 3.4% 1.06x 61.1x * 0.92x * 11.5x 8.0% 6.8%

ChannelAdvisor Corporation $9.00 59.4% $239.1 $185.8 $120.2 ($6.4) (5.3%) 1.55x NM 1.37x 23.5x 8.5% 13.8%

The Rubicon Project, Inc. $1.87 20.4% $91.8 ($47.3) $196.8 ($8.5) (4.3%) NM NM (0.43x) * 2.2x (45.0%) 20.8%

Marin Software Incorporated $10.95 57.1% $61.9 $35.3 $80.2 ($15.9) (19.9%) 0.44x * NM NM NM ND (5.2%)

Mean 73.5% $2,259.4 $358.2 3.3% 4.49x 9.2x 4.57x 14.7x 3.0% 18.3%

Median 76.4% $335.6 $11.3 3.4% 2.90x 9.2x 4.31x 11.5x 8.2% 20.8%

3 Year Rev CAGR

% of 52Week High

Market Cap.Enterprise

Value

Market Data Operating Statistics EV as a Multiple of: Growth

Stock Price LTM LTM CY2018 16 - '17

Company Name 12/31/17 Revenue EBITDA % Margin Revenue EBITDA Revenue EBITDA GrowthAverage

Dassault Systèmes SE $106.38 95.9% $27,136.4 $24,991.4 $3,876.1 $1,172.7 30.3% 6.52x 24.6x 5.54x 16.2x 19.7% 12.1%

Autodesk, Inc. $104.83 80.0% $23,090.6 $23,222.1 $1,981.6 ($328.0) (16.6%) 11.72x * NM 9.10x 54.3x * 0.8% (6.6%)

Splunk Inc. $82.84 97.6% $11,718.4 $10,737.9 $1,157.5 ($255.4) (22.1%) 9.28x NM 6.89x 51.1x * 30.7% 42.1%

Shopify Inc. $101.00 81.5% $10,087.6 $9,161.0 $580.9 ($35.6) (6.1%) 15.77x * NM 9.57x 187.7x * 69.6% 0.0%

Open Text Corporation $35.67 99.6% $9,469.7 $11,863.6 $2,631.8 $732.4 27.8% 4.86x 17.9x 4.12x 10.8x 32.0% 12.3%

Veeva Systems Inc. $55.28 81.2% $7,813.5 $7,055.4 $650.8 $162.5 25.0% 10.84x * 43.4x * 8.75x 27.1x 25.1% 31.1%

PTC Inc. $60.77 90.5% $7,056.9 $7,470.9 $1,184.4 $116.7 9.9% 6.42x 67.6x * 5.33x 18.4x 3.7% (4.4%)

Manhattan Associates, Inc. $49.54 88.9% $3,414.9 $3,285.2 $594.6 $197.6 33.2% 5.49x 16.5x 6.02x 25.0x (1.5%) 6.5%

The Descartes Systems Group Inc $28.40 90.9% $2,188.0 $2,210.3 $226.6 $75.1 33.1% 9.48x 28.6x 8.20x 23.4x 16.2% 10.7%

Kinaxis Inc. $61.23 83.5% $1,558.3 $1,407.4 $129.2 $25.7 19.9% 10.93x * 54.9x * 8.71x 30.0x 15.2% 24.1%

MicroStrategy Incorporated $131.30 63.8% $1,503.0 $856.9 $504.5 $86.9 17.2% 1.69x 8.8x 1.69x 11.6x (2.5%) (4.5%)

Workiva Inc. $21.40 90.3% $897.3 $839.4 $199.7 ($33.5) (16.8%) 4.20x NM 3.57x (57.5x) * 15.7% 23.5%

PROS Holdings, Inc. $26.45 86.7% $843.9 $896.9 $168.8 ($53.7) (31.8%) 5.52x NM 4.07x (71.0x) * 9.1% (3.1%)

SPS Commerce, Inc. $48.59 66.9% $836.9 $673.1 $220.6 $20.2 9.2% 3.15x 29.0x 2.52x 13.0x 13.7% 19.9%

QAD Inc. $38.85 92.5% $722.1 $596.0 $297.5 $8.8 2.9% 2.00x 68.0x * 1.89x 30.9x * 8.2% 1.0%

American Software, Inc. $11.63 89.2% $350.7 $270.2 $105.9 $14.7 13.9% 2.55x 18.4x 2.34x 13.1x (2.1%) 2.0%

ChannelAdvisor Corporation $9.00 59.4% $239.1 $185.8 $120.2 ($6.4) (5.3%) 1.55x NM 1.37x 23.5x 8.5% 13.8%

Datawatch Corporation $9.50 75.1% $116.5 $86.0 $37.6 ($3.4) (9.2%) 2.37x NM 2.10x NM 17.9% 4.2%

Mean 86.2% $814.9 $105.4 6.4% 4.65x 20.5x 5.10x 19.3x 15.6% 10.2%

Median 87.8% $401.0 $17.4 9.5% 4.53x 18.4x 4.73x 18.4x 14.4% 8.6%

% of 52Week High

Market Cap.Enterprise

Value3 Year

Rev CAGR

EVENT DATES LOCATION

Microsoft – Summit Dynamic Communities

Oct. 15 – 18 Phoenix, AZ

Oracle Open World Oct. 22 – 25 San Francisco, CA

Ad-Tech Nov. 1 – 2 New York, NY

6

(20.0%)

0.0%

20.0%

40.0%

60.0%

80.0%

100.0%

120.0%

Sales & Marketing Tech Product and Supply Chain S&P500

CHILDS Advisory Partners

STOCK MARKET FUNDAMENTALS

Marketing Tech: ABE, BV, CALD, CRTO, CRM, DOX, ECOM, FUEL, HUBS, JIVE, MRIN, LPSN, QNST, RUBI, XTLY, Product and Supply Chain: DSY, ADSK, OLTEX, SPLK, VEEV, SHOP, PTC, MANH, MSTR, DSGX, KXS, SPSC, PRO, WK, QADA, AMSW.A, ECOM, DWCH

MARKETING SECTOR INDICES VS. S&P 500

VALUATION TREND DATA (EV/LTM REVENUE)

1.0x

1.5x

2.0x

2.5x

3.0x

3.5x

4.0x

4.5x

5.0x

5.5x

6.0x

Sales & Marketing Tech Product and Supply Chain

3 mos. 12 mos. 3 yrs

Sales & Marketing Tech 11.9% 54.3% 93.7%

Product & Supply Chain 2.3% 36.2% 65.8%

S&P500 6.1% 19.4% 29.9%

3 mos. 12 mos. 3 yrs

Sales & Marketing Tech (0.8%) 8.4% (2.8%)

Product & Supply Chain 3.4% (9.7%) 9.5%

7

Buyer Target Target Description

Enterprise Value

($MM)

Q4 2017

Stone-Goff Partners DSG Consulting Provider of outsourced sales training and enablement services $39

Meredith Corporation (NYSE:MDP) Time Inc. (NYSE:TIME) Operator of a worldwide media company $2,813

Marlin Equity Partners Bazaarvoice (Nasdaq: BV)Provider of outsourced technology, community management, analytics

and syndication services$459

bpost SA/NV (ENXTBR:BPOST) Radial, Inc. Provider of omnichannel commerce technology $820

Gorilla Group SPROUT ContentProvider of inbound marketing services intended to build valuable

relationship between client and service providersND

Cognizant Netcentric Provider of digital experience and marketing solutions ND

Deltek Onvia (NasdaqCM:ONVI) Provider of business information and research services $70

IBM Vivant Developer of artificial intelligence systems ND

Q3 2017

GTCR Simpli.fiProvider of an online advertising platform designed to simplify digital

advertising through the use of unstructured dataND

KAR Auction Services, Inc. (NYSE:KAR) NthGen Software Inc.Mobile app and desktop solution that facilitates real-time dealer-to-

dealer vehicle auctions$175

Nielsen Holdings plc (NYSE:NLSN) Visual IQ, Inc.Developer of marketing intelligence platform created to identify

customers and prospects across touchpointsND

Harland Clarke Holdings Corp. MaxPoint Interactive, Inc. (NasdaqGM:MXPT)Developer of real-time digital marketing technology designed to drive in-

store sales for online advertisers and brand marketers$108

RhythmOne plc (AIM:RTHM) YuMe, Inc. (NYSE:YUME)

Provider of digital brand advertising software and services intended to

simplify the complexity of the fragmentation across screens, content

types and different consumer electronic platforms

$112

Fidelity National Financial, Inc. (NYSE:FNF) Real Geeks LLCDeveloper of customer relationship management and marketing platform

for real estate professionalsND

Sizmek Inc. Rocket Fuel Inc. (NasdaqGS:FUEL)

Provider of predictive marketing software intended to empower

agencies and marketers to anticipate people's need for products and

services

$147

Upland Software, Inc. (NasdaqGM:UPLD) Waterfall International Inc.Developer of a marketing software platform designed to provide cross-

channel marketing services$26

Investors Company Company Description Current Raised ($MM)

Q4 2017

RealCo Seed Fund dearduck, LLCOperator of a gift curating platform created to facilitate successful gift

exchanges$1.0

Falcon Partners, LLC; i2E, Inc., Investment Arm; The William

K. Warren FoundationiRecommend Software LLC

Developer of a next-generation recommendation engine built on artificial

intelligence and machine learning$1.9

Canal Partners, LLC; Tallwave Capital; Arizona Founders

Fund, LLCAllbound, Inc. Provider of a cloud-based channel sales and marketing platform ND

Q3 2017

Edison Partners; Hyde Park Venture Partners LookBookHQ Provider of a content marketing automation platform $11.0

[Unknown] Openprise, Inc.Developer of a cloud-based data automation platform intended to

leverage open data and open web technology on a single platform$3.2

Providence Strategic Growth SnapAppDeveloper of an online content marketing platform intended to allow

B2B marketers to create, publish and measure interactive content$10.2

CHILDS Advisory Partners

RECENT MARKETING TECHNOLOGY M&A TRANSACTIONS

RECENT MARKETING TECHNOLOGY CAPITAL RAISES

8

SCOTT RHODES

MANAGING DIRECTOR

404.461.4621srhodes@childsap.com

TOM DONAHUE

MANAGING DIRECTOR

617.663.5508tdonahue@childsap.com

JUSTIN BENTLEY

DIRECTOR

404.461.4648jbentley@childsap.com

▪ Former Corp. Dev. executive for two S&P 500 companies, Equifax and Waste Management, and CEO of PE-backed business sold to strategic buyer

▪ 14 years of investment banking experience including Robinson Humphrey and Bank of America

▪ Executed over 80 M&A and capital markets transactions

▪ MBA from Kellogg School at Northwestern University (Beta Gamma Sigma) and BA from UNC Chapel Hill (Phi Beta Kappa)

▪ 20 years of investment banking experience executing M&A transactions and raising capital

▪ Co-founder of Bulger Capital Partners

▪ Co-head of East Coast Services and Software for Needham & Company

▪ MBA from F.W. Olin School of Business at Babson College and a B.A. from Hobart College

▪ 9 years of investment banking experience including Morgan Stanley and KPMG

▪ Executed 15 M&A and capital markets transactions (over $15 billion in value)

▪ MBA from Darden School of Business at the University of Virginia and undergraduate from the University of Virginia

CHILDS Advisory Partners

FIRM OVERVIEW

CORE COVERAGE

Sales

Marketing

Content

Product

Supply Chain

Marketing

Human Resources

Vertical SaaS

Data & Analytics

Healthcare

SOFTWARE MARKETING TECH

• 45 professionals across four offices in U.S. with headquarters in Atlanta

• 83 transactions closed since 2014

• Over 450 transactions completed in the middle market (Enterprise Value less than $1.0 billion)

• 60% transactions since 2013 have involved a strategic buyer; 40% a financial sponsor

• Named 2016 U.S. Boutique Investment Bank of the Year by The M&A Advisor

SERVICE OFFERINGSQUICK FACTS

CAPITAL RAISES

MERGERS & ACQUISITIONS

FINANCIAL & STRATEGIC ADVISORY

Industrial Services

Human Capital Management

Technology

Services

Software

BUSINESS

SERVICESHEALTHCARE TECHNOLOGY

IT & Professional Services

ATLANTA | BOSTON | LOS ANGELESwww.childsadvisorypartners.com

SENIOR SOFTWARE TEAM

9

CHILDS Advisory Partners

TEAM’S EXTENSIVE EXPERIENCE IN MARKETING TECHNOLOGY

Currently raising growth capital

Provider of recruiting and CRM software for staffing industry

Provider of marketing services and solutions for the technology channel

has received an investment from

Provider of web-based retail ticketing, RFID, and software solutions

has been recapitalized by

Kepware develops software solutions to bridge the communication gap between diverse hardware and software applications

has acquired

Provider of business acceleration services for the digital economy

has been acquired by

Cloud-based channel data management solution

has been acquired by

Leading enterprise mobile application development provider

has been acquired by

Provider of SaaS CRM software and sales automation solutions

has been acquired by

Counterpoint Systems is a provider of rights and royalty management software

has acquired

Hawkeye Channel is a provider of sales and marketing solutions

has acquired

Cloud based RFID and data solutions to automate retail supply chains

has been recapitalized by

has been recapitalized by

Provider of outsourced sales training and enablement services

Project Apollo

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“As a past client of CHILDS, I knew the confer-ence would be great. CHILDSConnect provides a very efficient way to meet people and network while still giving attendees valuable and relevant content.”Dan Campbell, CEO at Hire Dynamics

“CHILDSConnect is a staple on my annual calendar and has proven to be a great place to meet middle market executives/owners. It is one of the only conferences I’ve been to with a professional yet casual vibe creating the perfect environment for relationship building.” Sean Barrette, Partner at L Squared Capital Partners

CHILDSConnect’s sector updates and networking opportunities were fantastic as CHILDS Advisory Partners’ professionals are incredibly knowledge-able about the interconnection between business services, technology and healthcare. They are able to connect the right people to inform meaningful dialogue, something that Ankura values. Julie Colasacco, Managing Director, Aegis Compliance & Ethics Center

www.childsadvisorypartners.com/childsconnect • 404-461-4600

THURSDAY, MAY 10TH, 201811:30 a.m. - 5:30 p.m. • St Regis Atlanta

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