Top Highlights of the ServiceNow M&A Market:

By: Jonathan Wallace and Atanas Chobanov

  •  Global reach with local sales and support organizations and strong brand recognition dominates customer shortlists, and its ITSM tool revenue market share is almost triple that of the closest competitor
  • Market capitalization has grown significantly from $8.5Bn to $45.5Bn since 2014, resulting in a shortage of skilled IT experts and consultants to implement its software platform
  • Large strategics found themselves under-resourced in ServiceNow capabilities and purchased the service providers that reached scale early, some in excess of 3.0x Revenue
  • Most remaining ServiceNow implementers are sub-scale, which creates an opportunity for private equity to consolidate the market
  • Purchase multiples are still revenue-based at 1.5x – 2.0x with recurring service models being valued most highly

The dominant market position ServiceNow holds helped to fortify the relationships between professional services and integrations within the ecosystem.
Looking forward to gaining even more insight while attending ServiceNow’s “Now at Work” Conference next month in Washington, DC.

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