We’re in a prolonged investment slowdown and VCs globally decreased their investments also in the second quarter of 2023. According to Crunchbase, the global funding in Q2 2023 was $65 billion, a drop of 18% from the previous quarter and a 49% decrease compared to the second quarter of 2022 ($127 billion). Looking at the semi-annual data we can observe a steady decrease, with $144 billion invested - a 51% decline from H1 2022 ($293 billion) and a 10% decrease from the second half of 2022.
For comparison, looking at the BVP Nasdaq Emerging Cloud Index, the median US revenue multiple at the end of June 2023 slightly increased to 6,93x annualized revenue (it has been rising steadily since the end of 2022 with a single dip in April 2023), but is still 62% lower from its record high of 18,34x in December 2021.
At the same time, as we see on the chart, the median CEE revenue multiple at the end of June 2023 decreased slightly to 4,18x annualized revenue (down 24% from an all-time high of 5,51x in December 2021).
Below, you can find the recent updates of the CEE SaaS Index, created by Vestbee and Warsaw Equity Group, a simple tool for startups and investors to evaluate SaaS companies in Central & Eastern Europe using revenue multiples from publicly traded CEE SaaS businesses. Each month we update CEE SaaS Index and compare it with the BVP Nasdaq Emerging Cloud Index in the US tracking the performance of emerging public companies providing cloud software to their customers.
- At the close of June 2023, the CEE median revenue multiple was 4.18x annual revenue, a dip of 24% from its peak of 5.51x in December 2021. In comparison, the US median revenue multiple was 6.93x annual revenue at the end of June 2023, a slight rise from the end of 2022 barring a single drop in April 2023, but still lower by 62% from its all-time high of 18.34x in December 2021.
- Market capitalization of all companies included in the CEE SaaS Index reached EUR 1.755B – rising steadily since the beginning of the year (EUR 1.434B in January).
- It seems that revenue multiples in the US are picking up faster than ones in the CEE –at the end of Q1 they were 43% higher and now they are 66% higher (at the beginning of 2020 the median ARR multiple in the US was over 3,5x times larger than in the CEE (10,32x vs 2,89x).
Interested in learning more? Check out our CEE SaaS Index and stay tuned for the updates and subscribe to our newsletter.
