The UserTesting sale to non-public fairness is dangerous information for unicorns • TechCrunch

Information broke this morning that UserTesting, a former startup that went public final yr, is promoting to non-public fairness (Thoma Bravo, Sunstone Companions) for $1.3 billion, or $7.50 per share in money. The deal, anticipated to shut within the first half of 2023, does embody a “go-shop” interval, in case a greater deal crops up.

Holders of UserTesting shares have some trigger for pleasure. The client perception platform is promoting for what it describes as a “premium of roughly 94% over [its] closing inventory worth” yesterday. Consequently, shares of UserTesting soared in the present day as buyers digested the information.

UserTesting dropped earnings this morning along side the deal information, giving us a window into its well being. We are able to cross these numbers with the ultimate worth that UserTesting will command within the sale to enhance our understanding of the worth of smaller know-how firms — at the least when in comparison with the giants of their trade.

The teachings thereof are fairly easy, and never nice for yet-private unicorns.

Wanting on the deal, it’s clear that single-digit SaaS multiples aren’t merely actual, however sturdy. UserTesting is exiting at a virtually 100% premium for a fraction of the worth at which it went public final yr. Except the corporate is a monetary mess, that’s terrifying for unicorns that raised cash final yr.