SaaS valuations: off the charts and staying that way


Legacy software companies get no respect — or market valuation — compared to Software-as-a-Service (SaaS) players. New research shows that over the past year, SaaS company valuations grew twice as much as valuations of legacy software companies rooted in the client-server world. And that SaaS valuation trend will continue for the next 12 to 24 months, according to new research from Martin Wolf M&A Advisors.


Wolf’s numbers show that a select group of SaaS companies saw their values grow 313 percent from January 2009 to October 2011, compared to 154 percent growth for other software companies over the same period.


“With SaaS, the more vertical the better,” Wolf said in interview.SaaS companies offering financial services, healthcare services or employee benefits outsourcing services, are all hot now, he added.


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