San Diego’s Software Equity Group Sees Software M&A Deals Ramping Up in 2011

The way some people talk, the annual report from the Software Equity Group is the software industry’s equivalent to “The Baseball Abstract,” the wildly popular report on hitting, pitching, and fielding statistics that Bill James began publishing in Kansas 34 years ago.

“Nobody else comes close to capturing the trends and transactions in the software industry that they have,” says Jeb Spencer, a co-founder and managing partner at TVC Capital, a small private equity firm in San Diego that invests only in software companies. It’s also surprising to many, Spencer says, that the best and most thorough analysis of the software industry’s transaction activity is put together by a boutique investment banking firm in San Diego.

But it’s certainly being read carefully at the higher levels of software companies, buyout firms, and elsewhere. The 2010 Software Industry Equity Report provides data, insights, analysis, and other information about software mergers & acquisitions, public software developers’ financial and stock market performance, software industry market trends, initial public offerings, and venture capital investments. It also includes the Software Equity Group’s 2011 “Buyer Survey,” which offers insights into the acquisition strategies at the largest software companies in the world.

JMI Equity managing partner Paul Barber tells me the report is an excellent resource to benchmark a software company’s performance against their peer group. And Mission Ventures managing partner Leo Spiegel says the annual report fills a gap in terms of providing in-depth industry research that is no longer available from many major financial institutions, which have cut back on equity analysts who make “buy” and “sell” recommendations on certain companies as a service to investment clients.

They are hardly alone. The Software Equity Group says it has sent copies of its 2010 Software Industry Equity Report to 20,000 subscribers in 64 countries. Customers, who are willing to pay $595 a copy, include software industry executives, venture capitalists, private equity investors, and other investment banks.

The latest report predicts that software mergers and acquisitions will ramp up significantly this year, after M&A deals increased

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Author: Bruce V. Bigelow

In Memoriam: Our dear friend Bruce V. Bigelow passed away on June 29, 2018. He was the editor of Xconomy San Diego from 2008 to 2018. Read more about his life and work here. Bruce Bigelow joined Xconomy from the business desk of the San Diego Union-Tribune. He was a member of the team of reporters who were awarded the 2006 Pulitzer Prize in National Reporting for uncovering bribes paid to San Diego Republican Rep. Randy “Duke” Cunningham in exchange for special legislation earmarks. He also shared a 2006 award for enterprise reporting from the Society of Business Editors and Writers for “In Harm’s Way,” an article about the extraordinary casualty rate among employees working in Iraq for San Diego’s Titan Corp. He has written extensively about the 2002 corporate accounting scandal at software goliath Peregrine Systems. He also was a Gerald Loeb Award finalist and National Headline Award winner for “The Toymaker,” a 14-part chronicle of a San Diego start-up company. He takes special satisfaction, though, that the series was included in the library for nonfiction narrative journalism at the Nieman Foundation for Journalism at Harvard University. Bigelow graduated from U.C. Berkeley in 1977 with a degree in English Literature and from the Columbia University Graduate School of Journalism in 1979. Before joining the Union-Tribune in 1990, he worked for the Associated Press in Los Angeles and The Kansas City Times.