The surge of PE acquisitions in venture-backed SaaS

News, insights and updates from the team at Bloom Equity Partners

Founders & Friends, Happy Friday!

We are back with another week of SaaS insights, news, and updates from the team at Bloom Equity Partners.

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Let’s get into it 🔥

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The surge of VC to PE acquisitions

Since launching Bloom Equity Partners, we’ve constantly shared our conviction on the growing presence of PE becoming a growing buyer of VC-backed software businesses. It was great to see fellow investor, Tomasz Tunguz (@redpoint) share the same conviction in his latest newsletter ‘PE in VC in 22’.

Here are a few noteworthy points from the piece.

• Private equity firms acquired $29 billion dollars’ worth of startups - a twenty-year record.

  

• In 2021, PE buyouts constituted more than 20% of venture-backed M&A by dollars.

  

• Startups bought by PE funds - record median sales prices consistent with strategic M&A.

Our take:

“PE will increasingly become a sound exit ramp for troves of great venture-backed businesses who will continue thriving under PE-style mandate and growth goals/timelines."

- Bart Macdonald, Managing Partner @Bloom Equity Partners

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What We’re Reading and Listening To…

📚 Ten lessons from a decade of vertical SaaS investing

📚 The 5 SaaS Metrics That Actually Matter

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Favorites from the Ecosystem

Investors👇…..

Michael Girdley @girdley

7 of the 10 richest Americans made their billions in software. Why software is the greatest business of all time:

Tyler Tringas @tylertringas

I will definitely invest in founders with prior success, but the most motivating thing in the world for me is giving first-time founders who don't come from wealth the capital (and community) they need to thrive.

Founders👇…..

Tweets from Zach Weinberg™ @zachweinberg

- So many VC funds with tons of money - Big co's slowing hiring - Growth co's shrinking headcount - Crap co's going bankrupt Sounds crazy but best time to be an early stage founder. There's still plenty of money but now you have a much better chance at recruiting great people.

Jeff Richards @jrichlive

one of the most important lessons you learn over time as a repeat founder is what "great" looks like. people, product, $, customer relationships, etc. hard to learn by reading books or any other method...😊

Operators👇….

Rob Khazzam @rkhazzam

Turns out the hardest part of a fast growing startup ain’t strategy, operations or product. It’s literally just context management and internal communication. If everyone knew everything everyone else knew everything would be really fucking easy.

Austen Allred @Austen

As startups grow there is extremely strong pull into what I call the death spiral of bullshit. More people -> more teams -> more buy-in required -> more meetings -> being persuasive rewarded more than building -> builders leave -> nothing gets done

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News from the Industry: deals, deals, and more deals 💰

PointClickCare valuation tops US$5-billion as private equity invests more in Canadian software giant

PE eyes discounts on software-as-a-service companies

Carlyle to Sell Unison Software to Buyout Firm Madison Dearborn

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End Note 🔚

As always, if you're enjoying The Weekly Bloom, we'd love it if you shared it with a friend or two. We try to make it one of the best emails you get each week, and I hope you're enjoying it.

And should you come across anything interesting this week, send it our way! We love finding new things to read through members of this newsletter.