Primary Venture Partners 2015 Overview of the New York City Sofware-as-a-Service Landscape As the enterprise SaaS market continues to mature, and as we watch a blossoming of SaaS activity in New York City, we believe NYC is poised to become a true leader in the formation of companies leading the next wave of enterprise transformation, ultimately challenging even the Bay Area for SaaS leadership. Primary Venture Partners took a deep look at the existing NYC SaaS landscape, seeking a clear understanding of the reality behind our anecdotal sense of our home market’s strengths. What we found is exciting and bodes awfully well for Primary and our friends who are focused on NYC SaaS investing. There is much more to come!

1. 1
SaaS in NYC
June 2015

2. 2015-2025: The NYC SaaS
Decade?
2
As the enterprise SaaS market continues to mature, and as we watch a blossoming of
SaaS activity in New York City, we believe NYC is poised to become a true leader in the
formation of companies leading the next wave of enterprise transformation, ultimately
challenging even the Bay Area for SaaS leadership.
Primary Venture Partners took a deep look at the existing NYC SaaS landscape, seeking a
clear understanding of the reality behind our anecdotal sense of our home market’s
strengths. What we found is exciting and bodes awfully well for Primary and our friends
who are focused on NYC SaaS investing. There is much more to come!
Key Findings:
SaaS company formation and investing has been rapidly accelerating in recent years,
and growing much more quickly than in the Bay Area
We’ve already seen a bunch of early exit successes, but with a growing pipeline of
extremely well-funded, high growth successes, we can expect many, many more
NYC is particularly well positioned to lead as vertical SaaS applications continue to grow
in importance vs. the historic horizontal paradigm

3. We are living in a SaaS economy
3
Nationally, >$200B of public market value created in the last decade
2004
CA-based Salesforce.com becomes the
first true SaaS company to go public with
a $1.3Bn valuation (now >$40B)
Today
SaaS companies make up over
$200Bn of public market value*
*includes companies that have switched to a cloud-based subscription software model since 2004 and acquisition values of acquired public SaaS companies

4. NYC SaaS Activity Rapidly Accelerating
4
Measured by rounds or $$, the last 5 years have seen rapid growth
0
350
700
1,050
1,400
1,750
0
75
150
225
300
2009 2010 2011 2012 2013 2014
rounds dollars
Source: Crunchbase; Internal Analysis
Rounds
CAGR (rounds): 31%
CAGR (dollars): 40%
$ millions
NYC SaaS Financings, by # rounds and $
invested

5. NYC beginning to over-index on SaaS
5
While SaaS has stayed steady in relative importance nationally,
it is steadily growing in share of overall startup activity in NYC
20%
24%
Bay Area NYC
2014
While not historically thought of as a SaaS stronghold, NYC now
20% over-indexes on SaaS financings vs Bay Area
21% 21%
Bay Area NYC
2009
SaaS represented an equal share of total financings amongst Bay
Area-based and NYC-based companies
Source: Crunchbase; Internal Analysis

6. New York is closing the gap
6
NYC SaaS investments are growing at a faster rate than the Bay Area
Investment Dollars
Similarly, the growth of $$ invested in NYC
SaaS companies has been more than
double the pace of growth of Investment
dollars in the Bay. While on average still
smaller than Bay Area financings, NYC
deals are getting bigger fast..
Number of Rounds
Five years ago, NYC had only 25% as
many SaaS deals as the Bay Area. The
NYC SaaS market has grown 2x as fast
as the Bay’s, and last year had half the
new SaaS deals of the Bay Area.
Source: Crunchbase ; Internal Analysis
2009 2014
50%
15% 33%
25%
bay area nyc
NYC as % of Bay Area

7. With some notable successes
7
Top exits for NYC-based SaaS companies
$745 million
A social media marketing platform, acquired
by Salesforce
June 2012
$675 million*
$2.75 billion*
$230 million
$100 million+**
$200 million+**
Data governance software platform for
unstructured data, went public in
March 2014
Cloud platform for clinical trials used by
pharmaceutical industry went public in
June 2009
Data management platform for
programmatic ads, acquired by Rocketfuel
August 2014
Helps organizations implement BYOD
mobile policies, acquired by Google
May 2014
Payment processing technology for
financial services, acquired by Google April
2012
* Market capitalization in March 2015
** Financial terms not disclosed; these price ranges widely reported
Source: Crunchbase ; CB Insights; Internal Analysis

8. and more potential in the pipeline
8
Recent large financings suggest a pipeline of potential future unicorns
Platform enabling SMBs to sell their
services online
$77 million funding
Monitoring service producing unified
metrics and events from IT infrastructure
$53 million funding
Modular desktop and API products for
integrating datasets / back-testing services
$180 million funding
Simple and fast cloud hosting service built
for developers
$90 million funding
Cloud-based technology platform dedicated
to improving cancer care
$140 million funding
Equity trading platform for mutual funds,
hedge funds and family offices
$100 million funding
SaaS-based recruiting technology solutions
to the Global Fortune 1000
$41 million funding
Next-generation database technology for
enterprise customers
$311 million funding
Automated patient check-in process for
healthcare providers
$73 million funding
Aggregates and analyzes disparate user
data to provide personalized marketing
$48 million funding
Cloud-based translation management
platform
$63 million funding
Complete social media management
platform for enterprise brands
$123 million funding
Low-latency market data and exchange
connectivity solutions for financial firms
$53 million funding
Small business digital presence
management platform
$116 million funding
Automated platform for managing online
offers, reviews and email campaigns
$40 million funding
Source: Crunchbase ; Internal Analysis
*includes NYC enterprise / SaaS companies that have raised over $40 million

9. 9
Leveraging New York City
Why will NYC lead the next generation of SaaS?

10. Rapidly changing SaaS Landscape
10
A collection of fundamental changes are reshaping the SaaS landscape
and redefining keys to success in building the next generation of winners
Consumerization
of IT
Simplification of
development
Verticalized
solutions
Mobilization Generational
transition
Simplified
applications,
sold from the
bottom up to
empowered
end-users
Standardized,
low cost, off-
the-shelf
infrastructure
Ubiquitous
SaaS adoption
creates
sufficient scale
for industry-
specific
solutions
Extends
enterprise IT
into the field
and redefines
UX; billions of
new end
points
Enterprise
tech buyers
are
increasingly
net & mobile
natives
• Success is increasingly domain expertise & customer access-driven; a marked shift from
SaaS 1.0, which was infrastructure & engineering-driven
• With access to unparalleled density of talent and customers, NYC is positioned to thrive

11. The domain expertise capital of the world
11
NYC’s breadth of sector clusters is unparalleled and a critical asset
520,000small businesses* make NYC the
largest hub for small businesses in
the U.S., nearly 2x the size of second
place LA
Real Estate
Finance
Healthcare / Pharma
Insurance
Fashion
Law
Advertising / Marketing
Consumer / CPG
Media / Publishing
Retail / SMB
Source: S&P, Business Journal
* Defined as businesses with 1-99 employees
19%of all S&P 500 companies are
headquartered in the tri-state area of
NY-NJ-CT
NYC
LA
Chicago
Miami
Philadelphia
Washington
Dallas
Atlanta
Boston
Houston
San Francisco

12. 12
Sample Regional Vertical Market Strengths
Real Estate Finance
Customer Base: Top NYC-based Firms
Market Size & Trends
NYC Disruptors
$72bn
Global software spend by Banking & Securities firms
IT spending in the finance sector is high, with firms
spending 6.3% of revenue on IT solutions on average
Disruptable
market?
Strength of NYC
disruptors?
Source: Crunchbase; Gartner; Frontline Partners; BCG; Internal Analysis
Customer Base: NYC’s Real Estate Market is Huge
Market Size & Trends
NYC Disruptors
$17bn
Global software spend by Real Estate firms
Disruptable
market?
Strength of NYC
disruptors?
Largest global CBD
Midtown New York City
68%
Highest percentage of
residential renters in the U.S.
Current real estate online consumer experiences lag other
industries, scoring only 52% of the cross-industry average
Domain expertise capital of the world

13. 13
Sample Regional Vertical Market Strengths (cont’d)
Healthcare / Pharma Insurance
Customer Base: Top NYC-based Firms
Market Size & Trends
NYC Disruptors
$31bn
Global software spend by Insurance firms
Current insurance online consumer experiences lag other
industries, scoring only 55% of the cross-industry average
Disruptable
market?
Strength of NYC
disruptors?
Customer Base: Top NYC-based Firms
Market Size & Trends
NYC Disruptors
$19bn
Global software spend by Pharmaceutical firms
Disruptable
market?
Strength of NYC
disruptors?
(ImClone)
Source: Crunchbase, Gartner, Informa Ovum, BCG; Internal Analysis
Spending likely to increase as firms use BI to incorporate
data from social media, electronic medical records and
genetic sequencing
Domain expertise capital of the world

14. 14
Law Advertising / Marketing
Source: Crunchbase, Gartner; Internal Analysis
Customer Base: Top NYC-based Firms
Market Size & Trends
NYC Disruptors
$2.3bn
Global spend on eDiscovery software by Legal firms
Spending on eDiscovery software is growing strongly and
is expected to double by 2018
Disruptable
market?
Strength of NYC
disruptors?
Customer Base: Top NYC-based Firms
Market Size & Trends
NYC Disruptors
$5bn
Global software spend by Marketing / Advertising firms
As more marketing driven spend moves online, it will be
important for large marketing firms to keep pace
Disruptable
market?
Strength of NYC
disruptors?
COUNSELYTICS
Domain expertise capital of the world
Sample Regional Vertical Market Strengths (cont’d)

15. 15
Media / Publishing
Source: Crunchbase, Gartner, Internal Analysis
Customer Base: Top NYC-based Firms
Market Size & Trends
NYC Disruptors
$17bn
Global software spend by Publishing, Broadcasting and
Entertainment firms
Disruptable
market?
Strength of NYC
disruptors?
Domain expertise capital of the world
Consumer / CPG
Customer Base: Top NYC-based firms
Market Size & Trends
NYC Disruptors
$14bn
Global software spend by consumer goods manufacturers
Disruptable
market?
Strength of NYC
disruptors?
CPG companies expected to focus software tools for
managing real-time KPIs and supply chain integration
Sample Regional Vertical Market Strengths (cont’d)

16. 16
Small Retail & Other SMBs
Source: Crunchbase, Gartner, Business Journal, Internal Analysis
Customer Base: NYC as an SMB hub
Market Size & Trends
NYC Disruptors
$23bn
Global Software spend by Retailers alone
SMB expected to increase IT spending by 38% in 2015,
focusing on CRM tools, BI tools and security
Disruptable
market?
Strength of NYC
disruptors?
520,000
Small businesses with 1-99 employees located in NYC
58,000
Jobs added by the retail sector in NYC since 2009
Domain expertise capital of the world
NYC
LA
Chicago
Miami
Philadelphia
Washington
Dallas
Atlanta
Boston
Houston
San Francisco
5xas many SMBs in NYC
versus San Francisco /
the Bay Area
HONEY
NYC also offers an unparalleled opportunity for SMB platforms

17. A magnet for talent
17
NYC acts as a strong funnel for talent to tech startups
Feeder Industries
A steady stream of business and
technical candidates freshly trained
by top tier banks, consultants and
tech firms
Strong Schools
Technical and general candidates
from top schools like Columbia,
NYU (and Cornell’s tech campus to
come )
Tech Community
With the major tech titans as anchor
tenants, the largest meetup group in
the world, and a robust group of
accelerators, the NYCTech
community continues to grow
Demographics
The city is a magnet for a diverse
inflow of young college grads
looking to live amongst their peers in
the most dynamic city in the world
TALENT
0
40
80
120
2009 2010 2011 2012 2013
Tech Jobs in NYC
Since the financial crisis, tech jobs in NYC have increased by
33% versus 8% job growth in the city as a whole
+33%
Average NYC Tech Salaries
Technology jobs can be among the best paying in the city
$79,500
$65,400
$118,600
Average (all jobs)Average (excl. securities)Tech industry
Source: New York State Comptroller's Office

18. NYC investors are leading the charge
18
A new growing base of native capital adds to NYC’s strength
Source: Crunchbase; Internal Analysis
otherNYC-based
Most active investors in NYC SaaS companies
(by total financings in the past five years)

19. What Next?
19
NYC’s SaaS ecosystem has arrived, and is poised for growth. So what now?
We are catching up to the Bay Area, and the growing importance of vertical
SaaS should help us further close the gap in the coming years
With a strong and growing pipeline of budding unicorns, we can expect
Medidata to have plenty of company in the NYC SaaS Unicorn Club by
2020
Look for a couple of sectors to really flourish – early promising candidates
are real estate, finance, healthcare/pharma, and small business
The big question: will we build standalone, anchor tenants in the
community, or a steady stream of M&A fodder for the big SaaS titans?

20. Thank You
Brad Svrluga, Co-Founder & General Partner
brad@primary.vc @bradsvrluga