tomtunguz.com · 2019-12-19
· 2359d
5 Predictions for 2020
Tunguz forecasts five major trends for 2020: direct listings becoming the standard IPO path, continued M&A market growth to ~$200B, distributed workforce adoption, elevated software valuation multiples around 9x, and a strong fundraising environment. He also reviews his 2019 predictions, scoring 3.5 correct and 2.5 incorrect.
Metrics in this report
Gross Margin
50percent
minimum
SaaS companies rewarded in 2019 IPO market
Public Software Valuation Multiple
9revenue multiple
median
Public software companies in 2020
SaaS Market Penetration
25percent
average
Current SaaS penetration by author estimate (range 20-30%)
Software M&A Market Value
200billion USD
forecast
2020 projected M&A spend in software sector
Software M&A Market Value
170billion USD
actual
2019 software M&A spend
Software M&A Market Value
136billion USD
actual
2018 software M&A spend