🤚 In case you missed it, in our recent research tracking the largest tech list companies (with IPOs > 1bn Market Capt), we've generated a barometer showing the valuation of those companies... still very far from what the Private Equity can offer.
🔹 Overall Valuations
The Revenue multiple has risen to a median of 3.92x in Q3 2023, showing a steady increase from 2022.
EBITDA multiples and PS ratios have similarly escalated, signaling robust investor interest despite economic headwinds.
PE ratio hit a median of 43.92x in Q3, underlining high expectations in profitability and growth for the sector.
🔹 Revenue Multiples by Sector
Corporate services lead with a 6.41x median multiple, followed closely by Fintech at 3.83x, indicating strong market confidence in these sectors.
🔹 Business Models
Models based on Research (17.77x) and Subscription (4.08x) boast higher multiples, reflecting investor preference for scalable, recurring revenue streams.
Freemium and Pay per models trail behind, suggesting investors’ wariness about monetization challenges in these approaches.
🔹 Science Verticals
Environmental and life sciences command a 13.34x multiple, underscoring investor interest in sustainable tech.
💼 What does this mean for tech investors?
These trends reveal a complex valuation landscape where revenue models and sector focus play crucial roles in determining multiples. Investors might find promising opportunities in sectors with rising multiples, while keeping a close eye on business models that offer predictable, recurring revenue.
#TechValuation #InvestmentInsights #ScaleXInvest
