How are SaaS companies rated before revenue

Unicorns everywhere: These are the most valuable SaaS startups in Europe

Anyone setting up a company now and having to choose a business model should perhaps rely on software-as-a-service - i.e. software in a subscription model. Microsoft, Salesforce, SAP, Adobe, Shopify - some of the currently most successful companies in the world offer their services in the cloud with a monthly billing model. In Europe, too, SaaS startups are growing up in various areas that are already worth billions - and are still growing significantly in terms of customers and sales. We will show you the most valuable representatives.

To start with, a short SaaS excursion. Salesforce introduced the term and business model over 20 years ago. The principle: companies offer their software in the cloud as a service. Customers do not have to worry about updates, new versions and server capacities. In return, you pay monthly for the service - and no longer once for the software. SaaS solutions are among the market leaders, especially in the areas of Customer Relationship Management (CRM) or Enterprise Resource Planning (ERP). Gartner analysts expect total sales of 105 billion US dollars for SaaS companies in 2020.

Before we present our small list, one last note: We are showing startups that were founded in Europe - even if they have now relocated their headquarters to the USA. What we noticed during the research: Many SaaS startups with a valuation of billions currently come from Israel or have their roots there - including AppsFlyer, Monday.com, GONG, Walkme or Sisense. Although many US analysts also include Israeli players in Europe, they do not end up on our list.

UiPath: From Romania to New York

In 2005 Daniel Dines and Marius Tîrcă founded UiPath in Bucharest. Both are still on board as CEO and CTO - only today they run the business out of New York City. And they seem to be doing well. Just a few days ago, the company announced a financing round of 750 million US dollars. UiPath's valuation skyrockets to $ 35 billion. A total of around two billion dollars is invested in the 15-year-old SaaS company.

But what are Dines and Tîrcă working on anyway? UiPath is a big player in Robotic Process Automation (RPA). Behind this is the automated processing of specified business processes by software robots - i.e. bots. UiPath wants to cope with all "repetitive, monotonous processes" within a company using the classic buzzwords AI and machine learning. According to the company, the recurring turnover is 200 million US dollars a year - and the trend is growing rapidly. 5,000 companies are now said to have UiPath in use. Next goal: an IPO this year.

GitLab: Developer Help for Millions

A Ukrainian and a Dutchman merged in 2014 in Utrecht and turned GitLab into a company. At that time the whole thing was still a small project by Dimitri Saparoschez (the Ukrainian) - but his co-founder Sytse "Sid" Sijbrandij (now CEO) believes in it. GitLab helps corporate developers manage their code in a development environment. The company is launching a Community Edition that is open source and therefore freely accessible.

With the Enterprise Edition, GitLab is benefiting from the SaaS boom. Just earlier this year, the company announced a sale of shares for $ 195 million. The valuation: six billion dollars. Here, too, the IPO is already firmly planned. Unless a big player comes by. Competitor GitHub was bought by Microsoft for $ 7.5 billion in 2018.

Veeam: Security from Switzerland

Okay, we're cheating a little here. Veeam from Switzerland is no longer an independent company. It has been owned by US VC Insight Partners since March 2020. The valuation of five billion US dollars at the time of purchase still makes you sit up and take notice. Like so many companies on the list, Veeam is now looking to enter the US market. This should be achieved with their own software for data security and recovery in the cloud, for which 365,000 users pay according to their own information. Annual sales are $ 1 billion.

Darktrace: On the way to the stock exchange

Darktrace is also building its business model around digital security. The software of the company, which was founded in Great Britain in 2013, should be able to use AI and machine learning (the buzzwords again) to detect and defend against cyber attacks - also in the cloud. The founding story is particularly exciting: Darktrace is the result of a collaboration between former British secret service employees and mathematicians from Cambridge University. Now the company is mainly working on its rumored IPO, which should bring a valuation of five billion US dollars.

Talkdesk: One of the big CRM winners

We move on to Portugal, where Talkdesk has grown into a European unicorn since 2011. In mid-2020, the company raised $ 143 million - the valuation rises to $ 3 billion. Why is Talkdesk so valuable? The company helps corporations such as IBM, Dropbox or Peloton to keep an eye on their customer contacts. In addition to pure data management, Talkdesk offers central communication via SMS, live chat, e-mail, telephone and social networks via the platform. The pandemic gives the Portuguese business model a further boost, because the call center and customer management have ended up in the home office - and have to access the data from there too.

MessageBird: Big round for the Twilio challenger

Another pandemic “winner” is likely to be MessageBird from Amsterdam. The platform provides the technological basis for customer communication - so it allows companies to handle phone calls, SMS and messenger messages via the cloud. Companies can also easily integrate the communication channels into their apps and websites via MessageBird.

The SaaS startup is thus competing with the US giant Twilio (here in the OMR portrait), which currently has a market value of almost 65 billion US dollars. Due to the upswing in the Corona crisis, MessageBird is also more valuable than ever. In October 2020, the company announced a $ 200 million financing round that pushes the valuation to $ 3 billion.

Celonis: You can't do more SaaS business

We have arrived at the German representative of the list: Celonis relies on SaaS and enterprise software solutions such as those from SAP, Oracle and Salesforce and analyzes the effectiveness of the processes taking place there. Celonis show bottlenecks in the processes and help to speed them up. This so-called process mining is used by Bayer, Vodafone, Siemens, Dell, Lufthansa and other big names, among others. The customer list also seems to have impressed investors: In 2019, the company's valuation rises to $ 2.5 billion thanks to a $ 290 million investment.

Collibra: Handling data intelligently

Many of the SaaS startups already presented build their success on data processing and analysis. And that is also central for Collibra from Brussels. The company's tools help to collect company data and make it available centrally. For example, large insurers collect data about their customers in the Collibra platform so that teams around the world can access it and use it for offers. And since home office and a decentralized structure are currently unavoidable, the company should continue to benefit. Most recently, Collibra raised over $ 112 million in April 2020 - at a valuation of $ 2.3 billion.

Kaseya: Digital infrastructure with multiple brands

A SaaS unicorn comes from Dublin with a lot of tradition. Kaseya was founded in 2000 - today the company is worth around two billion US dollars. Kaseya sees itself as an all-round solution for the IT infrastructure of companies of all sizes. Various subsidiary brands then offer the respective software services under their own names. From remote IT management (VSA) to service automation (BMS) and an IT service desk (VOREX).

Personio: HR champion from Germany

The newest representative in the club of SaaS valuation billionaires is the German HR startup Personio. It wasn't until January 18, 2021, that the team announced a $ 125 million investment that would give the company a valuation of $ 1.7 billion. Personio provides small and medium-sized companies (between ten and 2,000 employees) with a comprehensive HR platform. This should bundle recruiting, onboarding, salary payments, vacation planning and other functions in one place. In the past year alone Personio doubled its turnover and now has 3,000 customers in Europe. The pandemic should give the startup a further boost. Because the otherwise rather difficult target group of medium-sized companies is currently being pushed even more into digitization.

Pipedrive: Freshly baked unicorn

Pipedrive has also not been in the billionaires club that long. However, we cheat a bit here - as with Veeam. At the end of 2020, the Estonian startup will go to the American private equity firm Vista for a rumored price of 1.5 billion US dollars. Why is Pipedrive so valuable to the funder? The company offers sales CRM software with which users can create and visualize a “sales pipeline”. Sales employees can clearly see at which level their deals are currently and where action is required. According to the company, more than 95,000 sales teams are already using the tool.

Also worth a mention:

We know that such a list can never be complete and in the rather confusing SaaS business a remarkable company can slip through. Here are a few more aspiring candidates from the European SaaS scene that we didn't want to withhold from you:

Mirakl from France helps e-commerce companies manage their marketplace. Contentsquare, also from France, supplies an analytics tool for evaluating the user experience on websites. Sendinblue, the next French, offer an email marketing tool and compete with Mailchimp. Commercetools from Germany is a bit on the trail of Shopify with its shop solution for larger companies. And Contentful from Berlin helps large companies like Urban Outfitters to manage their content across all channels.