Software valuations influence markets and shape every exit decision. Over the past decade, valuation multiples have shifted sharply as investor priorities moved from growth at all costs to efficient, profitable expansion. In this article, we look at how software valuation multiples changed worldwide from 2015 to 2025 and why they matter to founders, executives, and investors.<\/p>\n\n\n\n
Publicly traded software companies report valuation multiples every day, but the link to private deals is not always straightforward. Understanding that connection helps with both market read and exit timing. Public pricing now rewards cash flow, sustainable margins, and efficient growth; trends such as AI adoption, vertical SaaS, and usage-based pricing also shape investor expectations.<\/p>\n\n\n\n
Private software firms differ meaningfully from their listed peers. Many are smaller, more focused on profitability, and operate outside major U.S. exchanges. To provide a more relevant view, we analyzed hundreds of private software M&A transactions completed between 2015 and 2025. We examine how multiples vary by deal size, geography, business model, and growth profile to give practical benchmarks for funding and exits.<\/p>\n\n\n\n
Understanding how software valuation multiples have evolved globally over the past decade provides essential context for today\u2019s M&A market. After a long period of expansion fueled by low interest rates and high growth expectations, multiples reached record levels in 2021 before normalizing in the following years. To assess these changes accurately, we focused our research on private-market transactions rather than public-company benchmarks.<\/p>\n\n\n\n
For this research, we reviewed a proprietary database of over 45,000 software-related transactions completed globally. From this universe, we identified transactions completed between 2015 and 2025 and focused on those with disclosed valuation multiples.<\/p>\n\n\n\n
As part of the analysis, we reviewed individual transactions to ensure they reflected core software business models. Transactions that primarily related to IT services, marketplaces, e-commerce businesses, or other non-software models were excluded, as were clear valuation outliers. All other selection criteria used in previous analyses remained unchanged.<\/p>\n\n\n\n
Following this screening, the final sample comprised 1,325 software transactions with disclosed EV\/Revenue multiples, of which 622 also reported EV\/EBITDA multiples. This allowed us to benchmark both growth-oriented and more mature software companies.<\/p>\n\n\n\n
Because valuation multiples are disclosed for only a subset of private-market transactions, the dataset is not fully comprehensive. However, the remaining sample spans a broad range of geographies, deal sizes, and software business models, providing a robust basis for identifying valuation patterns in the software M&A market.<\/p>\n\n\n\n
The analysis examines how valuation multiples vary by:<\/p>\n\n\n\n
The dataset includes both on-premise and SaaS companies, reflecting the continued transition of traditional software vendors toward subscription-based and cloud models.cused view of how valuation multiples have evolved over time and across market segments.<\/p>\n\n\n\n
Over the past ten years, software companies have historically attracted premium valuation multiples relative to many other sectors, reflecting strong investor appetite for scalable, high-margin business models.<\/p>\n\n\n\n
Across 1,325 transactions with disclosed EV\/Revenue multiples, the median revenue s<\/span>tood at 3.7x, with the top quartile reaching 7.2x and the bottom quartile at 2.0x. This highlights how key factors such as growth rate, customer base quality, and recurring revenue influence outcomes.<\/p>\n\n\n\n 622 transactions reported<\/span> EV\/EBITDA multiples for profitability-focused metrics, showing a median of 19.0x EBITDA. More profitable or strategically positioned companies reached 34.6x EBITDA or higher, while slower-growth or concentrated businesses traded around 11.1x.<\/p>\n\n\n\n These figures show how company performance and risk profile affect valuation. Businesses with strong revenue growth, diversified customers, and predictable earnings typically fall in the upper quartile, while smaller or lower\u2011growth companies trade closer to the lower quartile.<\/p>\n\n\n\n Revenue multiples are widely used when valuing software companies, especially those investing heavily in growth while generating limited or no profit.<\/p>\n\n\n\n From 2015 to 2017, software EV\/Revenue multiples were relatively modest, mostly in the 2\u20134x range, reflecting steady but conservative market conditions.<\/p>\n\n\n\n In 2018\u20132019, multiples gradually expanded, reaching around 4\u20135x as investor appetite for scalable SaaS business models increased and cloud adoption accelerated.<\/p>\n\n\n\n A sharp expansion occurred between 2021 and early 2022, with the median multiple peaking at 6.7x, driven by abundant liquidity, ultra-low interest rates, and an investor focus on growth over near-term profitability.<\/p>\n\n\n\n Software valuation multiples: EV\/Revenue<\/p>Multiple<\/th> Sample (n)<\/th> 1st Quartile<\/th> Median<\/th> 3rd Quartile<\/th><\/tr><\/thead> EV\/Revenue<\/td> 1,325<\/td> 2.0x<\/td> 3.7x<\/td> 7.2x<\/td><\/tr> EV\/EBITDA<\/td> 622<\/td> 11.1x<\/td> 19.0x<\/td> 34.6x<\/td><\/tr><\/tbody><\/table> Median EV\/Revenue multiples for software companies<\/h3>\n\n\n\n