Welcome to the Tech &A Podcast. Presented by the Corum Group. Welcome to the Tech &A podcast. Here we feature special reports on 29 tech sectors, current valuations, key trends and interviews, highlighting the strategies, challenges and candid stories of tech entrepreneurs who have successfully sold their companies. Today we present the monthly Tech &A report from the research team here at Corum. This is an audio presentation of our monthly webcast hosted the second Thursday of every month.
To register for our next webcast, Visit Corumgroup.com forward slash events. And now, the November Tech &A Report. Good morning, afternoon, or evening, depending on where you are. Welcome to Corum Tech &A Monthly Webcast for November 2024. I'm Heidi Owen, Executive Vice President of Marketing at the Corum Group and your host for today. Here's our agenda for today. We'll begin with the CEO's desk.
Afterwards, we'll go to the Tech &A Market Research Report, then over to our first special report, Mastering Your Emotions in the &A Process. and finally finish it off with a special election report from Bruce Milne. Now, let's get started with the CEO's desk. I'll hand it over to Bruce Milne, CEO of the Corum Group. Greetings from Kuala Lumpur. I'm here with my Corum colleagues and the World Financial Symposiums, hosting the first tech &A masterclass in Asia.
We're excited to host an incredibly diverse group of attendees all across the APAC region, whose expertise covers every aspect of the software and IT world. Malaysia's vibrant tech ecosystem is growing, buoyed by government commitment to fostering innovation. We're honored to have the Malaysian government's support through MDex sponsorship of the masterclass this week. We can't thank them enough.
This year, the Malaysian government announced several major initiatives to advance the goal of building one of the top 20 global startup hubs by 2030. And Malaysia is not alone. All across Asia, governments are actively supporting domestic companies and the broader tech ecosystem, notably Singapore, Vietnam and Thailand through startup programs, tax incentives, talent development, and by attracting foreign investment.
Additionally, a tech savvy population and skilled workforce have been key drivers of growth across the region. The maturing tech industry in Asia is also fueling robust &A activity as we tracked 404 transactions through Q3 this year. Corum is at the forefront of the Asia tech scene. Indeed, we host over 75 educational events a year in Asia. including online boot camps and in-person seminars.
Our regional resources, newsletters, magazines, and tech &A reports further support this vibrant and growing ecosystem. Our Asian team now is expanded to seven dedicated deal makers and other score of regional support staff, all supported by the strength of the Global Corum Network. These investments represent our commitment to the region, helping our clients achieve an optimal outcome.
In over 20 years, we have become not only a leading educator, but also leading seller of software and IT companies in Asia. Going forward, we see many more companies on the cutting edge of technology, particularly with AI, that will be attracted to Western buyers. If you're a buyer looking to make an acquisition in Asia, call us. We're seeing extraordinary opportunities. Now, onto our deal report. Thanks, Heidi. I'm happy to add another deal announcement to the list.
Corum client XISS has been acquired by N Square Group. XISS, a global expert in managed services for the high-performance computing and artificial intelligence computing areas, joins N Squared Group's list of growing companies that help clients be more productive, innovative, and risk-aware in these areas, as well as scientific computing. XISS is the fifth company to join N Squared's radical new approach to transform computing and technology investment.
Congratulations and continued success to both teams. I'm happy to add another deal announcement to the list. Corum client Network Capacity Solutions has been acquired by ConnectBase. This acquisition marks a pivotal step in ConnectBase's mission to build location truth and digitally transform how connectivity and digital infrastructure get bought and sold.
ConnectBase, the global ecosystem for buying and selling connectivity coupled with Network Capacity Solutions inventory lifecycle management platform. provides the market with the most comprehensive end-to-end solution for data centers and service providers. As ConnectBase continues to scale, the acquisition of network capacity solutions positions the company to further innovate in the connectivity space.
This move will deliver enhanced value to its growing ecosystem of partners and providers, driving the evolution of the global connectivity marketplace. Congratulations and continued success to both teams. Congratulations again to everyone involved. Now let's get to the Tech &A Market Research Report by Corum's globally renowned research team, where we will look at how Tech &A is doing across all sectors.
We begin with the public markets, where in the US the S &P tech index rose by 2.1 % in October while the Nasdaq and Dow Jones indices both dropped. The US economy continued to grow at a robust pace in the third quarter, though weakness in Europe and Asia has investors concerned. In Europe, The CAC 40, DAX, and FTSE 100 all declined in October as the continent's economies are contending with slowing growth.
Pivoting to Asia, the Nikkei climbed by 3.1 % in October, while the Hang Seng and SSE Composite dropped. Investors digested the results of Japan's election and recent stimulus measures out of China. Our Corum Index shows 450 transactions in October, including six megadeals, the largest worth $10.6 billion. There were 39 private equity platform deals and 82 VC-backed exits. Non-tech buyers pocketed 32 tech companies, highlighting the diverse nature of the global buyer universe.
Dealmaking remains highly international with 40 % of transactions being cross-border. October witnessed six mega deals distributed among the horizontal, internet, and vertical sectors. The vertical sector continued to lead in terms of both deal volume and value. In the internet sector, revenue and EBIT evaluations in October were broadly in line with levels seen in recent months.
The travel and leisure subsector had the highest sales multiples at 4.1 times, and the e-commerce subsector had the highest EBIT evaluations at 14.5 times. Starting with a mega deal in the sector, Turkish online shopping platform Hepsi Berado was acquired for about $1.2 billion by Kazakh fintech and e-commerce giant Cas BKZ. to expand its regional reach and create new opportunities for SMEs in Turkey and Kazakhstan.
Among other deals in the internet sector, memorial and obituary platform Butterfly was purchased by Better Place Forest, the creator of America's first memorial forest to bridge the natural and digital world. And in the UK, digital will writing company, Fairwill, was acquired for nearly $17 million by funeral service provider Dignity, boosting its end of life services offering.
Finally, we saw deals among web-based pet care providers as AI-powered pet health startup Dig Labs was scooped up by fresh dog food company, OLLI, introducing a new service called Health Screening for Pet Owners. Elsewhere in the space, online pet and animal pharmacy, Allivet, was wrapped up by rural lifestyle retailer Tractor Supply, complementing its offerings for companion animals, equestrian and livestock.
And in Australia, pet telehealth services provider Speak to a Vet was bought by online veterinary consulting firm, Dialivet, to reach more pet owners by providing easier access to licensed veterinary care. In the horizontal sector EBITDA multiples have steadily climbed higher since June reaching a 12-month high of 20.6 times in October. The supply chain management subsector had the highest sales and EBITDA valuations at 12 times and 41.2 times respectively.
There were two mega deals in the payments subsector as crypto startup Bridge was bought for a reported $1.1 billion by payment giant Stripe. moving into the stablecoin sector, and billing software firm Zora was jointly acquired for $1.7 billion at 2.7 times revenue by PE firm Silver Lake and Singaporean wealth fund GIC.
In the UK, foreign exchange and payment service provider GC Partners was picked up by Swiss asset advisory firm Montreux Capital Management to enter the $5 trillion daily trading volume of the foreign exchange market. and payment processor Blockchip was snapped up by its peer company Stax to expand its end-to-end capabilities. Another mega deal took place in the HR sector, where workforce software was wrapped up for a reported $1.2 billion by ADP, growing its HCM offerings.
Among other deals in the sphere, German workforce planning and skills management software maker HRForecast was bought by labor market analytics specialist Talent Neuron. planning to create an end-to-end strategic workforce planning platform. Also, British cloud-native workforce management startup Surfboard was picked up by customer intelligence platform Dialpad to boost its position in the contact center market.
In customer analytics, Paris-based video research platform Tactics was purchased by online survey and research services firm QuestionPro, adding to its experience research offerings and entering the French market. Finally, The Bengaluru-based AI-powered customer insights platform, Ask Echo, was bought by e-commerce acceleration company Spretail, enhancing its AI capabilities. In the infrastructure sector, revenue valuations have steadily climbed higher since May, reaching 4.6 times in October.
The security subsector had the highest sales multiples at 6.5 times, and the storage and hosting subsector had the highest EBIT evaluations at 33.9 times. In the AI-powered security space, intelligence data protection platform TRAIL was acquired for $162 million by cyber unicorn Sierra, leveraging AI for advanced data security.
And AI-based risk decisioning platform EFFECTIVE was wrapped up for $136 million by predictive analytics firm SOCURE, creating a unified identity and fraud decision engine. Among development tool providers, GPU cloud infrastructure and AI model deployment specialist TurboScale, was bought for $150 million by human capital management platform provider Shift Pixie to streamline workforce management with enhanced AI-powered features.
And UK-based bot building company, The Bot Platform, was pocketed by FLIP, a German app for frontline employees to strengthen its AI-powered tools that enhance employee engagement. Elsewhere in the infrastructure sector, AI-powered video creation and editing platform, VIDS, was picked up by digital video advertising firm Show Heroes Group, enabling it to generate, edit, and optimize video content with AI-driven precision.
And generative video AI specialist LA was acquired by its fellow company, Panopto, adding text-to-video and avatar creation features to its portfolio. In the vertical sector, sales multiples have roared higher since February, reaching a 12-month high of 5.6 times in October. The AEC subsector had the highest revenue and EBIT devaluations at 12 times and 45.4 times respectively.
The AEC subsector has also witnessed the largest October tech deal as computational intelligence specialist Altair was wrapped up for $10.6 billion by Siemens to create the most complete AI power design and simulation suite. Corum acted as an advisor on two transactions with Altair. representing DEM Solutions out of the UK in 2019 and S-Frame out of Canada in 2021, both of which added simulation specialists to Altair's portfolio.
There was a mega deal in the health tech subsector where global payments sold this medical business Advanced MD to PE firm Francisco Partners for $1.1 billion. Among other deals in this space, health system performance optimization specialist Occumen was acquired by healthcare information technology company HC1 to expand its data-driven lab insights.
And motion capture AI company RehabBoost was purchased by healthcare technology solutions provider Medbridge to boost its AI-enabled body movement analysis offerings for rehabilitation patients. In real estate, property furnishing platform Virtual Staging AI was wrapped up by real estate search engine giant Zillow Group. to create a more immersive listing experience for its clients.
And Curated Social, a media content platform for real estate agents was acquired for $2.5 million by agent review technology company Rate My Agent, bolstering its market position and expanding offerings. In the manufacturing field, production scheduling specialist Phoenix Software was scooped up by manufacturing and supply chain software vendor QAD to broaden its advanced scheduling capabilities for adaptive enterprises.
Elsewhere in the space, Italian manufacturing software company said APTA was bought for nearly $68 million by Finnish telco and digital services firm Elisa, accelerating the growth of its industrial software business. In the consumer sector, EBIT evaluations have skyrocketed since April, reaching a 12-month high of 17.7 times in October. The casual gaming and core gaming subsectors had sales multiples of 2.2 times and 4 times respectively.
In the gaming space, extended reality firm Zapar was acquired for $45 million by metaverse platform Infinite Reality, marking its sixth acquisition in 2024. In Sweden, mobile gaming studio Racket Spell was purchased for $7.5 million by investment company Wrightbridge, adding to its gaming portfolio and increasing its presence in the fast-growing gaming industry. And in Saudi Arabia, game studio UMX was bought for $4.5 million by Jetapult.
an India-based investment company in the gaming landscape as MENA gaming booms. Among companies providing financial solutions for consumers, Asian communications technology group Singtel sold its mobile wallet Dash to Western Union aiming to broaden its financial services ecosystem. Lastly, Gibraltar-based crypto company Damax sold its retail arm to crypto banking app ZGlu out of the UK to accelerate European expansion.
In the IT services developed market sector, Revenue and EBITDA valuations in October were in line with levels seen earlier in the year. In the IT services emerging market sector, sales multiples have trended upwards since May, reaching 2.9 times in October.
The trend for game development services continued into October, as Keyword Studios wrapped up another co-developer, Certain Affinity, that has worked on games such as Halo, Hogwarts Legacy, and Call of Duty, adding scale and action genre expertise to Keyword's Create division.
Among other deals, software and data engineering firm Gemba Advantage was purchased by tech transformation and cybersecurity services provider Actica Consulting, boosting its capabilities in designing, building, and maintaining mission-critical systems for government clients. And in Argentina, software development services provider Mobile Computing was bought by its American peer firm Grid Dynamics to expand its footprint in South America.
Among system integrators, Corum client XISS high-performance computing and AI specialist was acquired by N Square Group growing its portfolio. And in UAE, AI ideology and AI tech services startup was bought by MDSSI, a subsidiary of International Technology Distribution and Services Group, Mides, expanding its AI capabilities across the Middle East. In the security services field, Dell sold its SecureWorks subsidiary for $859 million to Sophos.
broadening its security portfolio with the seller's flagship cloud-based platform, Tejas, which helps to detect advanced threats. And Condatis, a UK-based digital ID and access management consulting firm, was snapped up by PE firm Bridgepoint. And that's our report. A special thanks to our amazing international research team. Please do get in touch if you'd like a copy of the full research report, and we'll make it available to you. Now, on to our special report.
Mastering the emotions of the &A process. Selling a company isn't just a business transaction. It's an emotional journey that some sellers don't expect. Today, we're diving into the roller coaster of emotions CEOs and founders experience during the &A process. Buckle up. The selling process is filled with highs and lows. It all starts with apprehension and doubt. Is it the right time to sell? What about my employees? Am I ready to give up control?
Once the decision is made and offers start rolling in, there's a surge of excitement. The future looks bright. But then comes the letter of intent. Suddenly, the buyer's in control and due diligence begins. Fear strikes and sellers often worry. Do I have all the information they need? Are my financials in order? As due diligence drags on, discouragement, frustration, and even anger build. Repeated questions and scrutiny of every detail can feel like an invasion.
As due diligence wraps up and discussions around the purchase agreement progress well, there's light at the end of the tunnel. The integration plans form and the finish line is in sight. Hope and optimism return. With a closing date set, there's a collective sigh of relief. The end is near. Finally, the deal closes. The money's in the bank and it's time to celebrate. Understanding these emotional swings is vital because emotions can get in the way of achieving an optimal deal.
They can even kill it. Now, how can sellers navigate this emotional journey? 1. Draw on past experience if you have it. 2. Expect some frustration. It's normal. 3. Lean on your advisors. They've been through this before. 4. Prepare thoroughly for due diligence to reduce stress. Five, stick to the facts during negotiations. Six, if emotions overwhelm you, don't be afraid to pause the process. Remember, selling your company is more than a transaction. It's a major life event.
Understanding and preparing for these emotional swings can ensure a smoother, more successful sales process. An experienced &A advisor can provide stability and guidance through the emotional &A journey, keeping you on target. and focused on your goals. Now let's go to our special election report. Trump Ignites Tech &A. Hi, it's Bruce Milne. I'm in Asia preparing for the Tech &A masterclass. I was over here during the election.
What was interesting is that every major international channel had the election as a number one news. They're actually following it live. Frankly, the best unbiased coverage was Al Jazeera. The impact of the election is profound. The positive momentum in the stock market was reflected immediately in the buyer's attitudes. The phone was ringing off the hook. I believe that we will see more offers, more companies go into LOI in the next month than any time in history.
There's never been a better time for you to consider selling your company. Let's take advantage of this. special note to my friends in Asia. We've been running conferences here for over 20 years and everybody's interested in timing. Probably not a better time for you. Not only is there more cash in the system and more buyers, but the buyers are hungry as we're seeing even for US and European companies.
But there's also a huge disparity in currencies between the dollar and regional currencies and also wage disparity. Western buyers are going to be aggressively going after Asian companies no matter how small they are. Don't miss this window of opportunity. If you'd like a copy of this month's full Tech &A Research Report, email us at info at coramgroup.com. Thank you for tuning in to the Tech &A Podcast.
If you enjoyed the show, please share it with your friends, colleagues and fellow entrepreneurs. We release new episodes every two weeks and present the research report on the second Thursday of each month. So make sure to subscribe and stay up to date on our latest interviews and Tech &A Research. And while you're there, go ahead and drop us a rate and review.
And if you have any suggestions or topics you'd like us to cover, please reach out to us on social media or email us at info at Corum group.com. Join us again next time for more inspirational stories and practical tips from tech founders who have successfully navigated the exits of their companies.