A deep look at all the VC, private equity, M & A and IPO activity in the SMB software space in North America for Q3 2019

1. THE STATE OF SMB SOFTWARE
A l ook at Q3 2019’s fundrai si ng and exi t t rends among
Nort h Ameri can SM B soft ware compani es
Q3
2019

2. SUREPATH INSIGHTS
STATE OF SMB SOFTWARE – Q3 2019
surepathcapital.com
T a b l e o f C o n t e n t s
01 Introduction
02 Lessons and Takeaways
03 Methodology and Scope
04 Venture Capital (VC) Deals
05 Private Equity (PE) Deals
06 Mergers & Acquisitions (M&A)
07 IPOs
08 Public Market Activity
2

3. SUREPATH INSIGHTS
STATE OF SMB SOFTWARE – Q3 2019
surepathcapital.com
S u r e P a t h : O u r P u r p o s e
Hel ping fund, grow, and exit SMB software companies
SurePath maximizes your optionality:
We make sure you know what it takes to build a market leader and capitalize you towards that goal.
We ensure you are always in the minds of strategic buyers so that if they decide to make a move in your space, you are
in the conversation. You can then decide; Keep going or exit?
The process of raising growth capital is very different from raising early stage capital.
It is cheaper than ever to start companies, but more expensive than ever to build market leaders. If that’s
your aspiration, you need growth capital.
We help you prepare for growth stage and help you raise the capital needed to become a market leader.
Growth
Funding
We have sat on both sides of the table. We have funded, grown and exited many companies.
We remain in touch with our clients between transactions to provide ongoing advice and intros.
A low touch, high impact way to help you grow.
Strategic
Guidance
Most investment banks are generalists that take the same approach to every sale.
We work with you to facilitate the BD and Corp Dev intros that pave the way to inbound interest.
No other investment banking firm has the depth of our relationships in the SMB world.
Exits
3

4. SUREPATH INSIGHTS
STATE OF SMB SOFTWARE – Q3 2019
surepathcapital.com
S u r e P a t h a n d S M B
Business Management E-Commerce
CRMMarketing Tech
Payments
We havebeen part of somethe mostsuccessfulSMBSaaS companies
We havedeep relationships withSMBinvestors andbuyers
SurePath is committedto becomingthe leading strategic financial advisor to the global SMB software market
4

5. SUREPATH INSIGHTS
STATE OF SMB SOFTWARE – Q3 2019
surepathcapital.com
T h e S u r e P a t h T e a m
The SurePath team has over 30 years of experience in operating, growing, investing, buying, and selling SMB software companies.
MARK MACLEOD
FOUNDER
JOSH SCHERMAN
VICE PRESIDENT
DANIAL SHAIKH
ASSOCIATE
SARA DEFINA
ANALYST
ERIK MOSNEY
ANALYST
KJ LEE
ANALYST
5

6. SUREPATH INSIGHTS
STATE OF SMB SOFTWARE – Q3 2019
surepathcapital.com
R e c e n t S u r e P a t h D e a l s
served as the exclusive strategic
and financial advisor to
on its growth
financing led by
USD $60,000,000
served as the exclusive strategic
and financial advisor to
on its growth
financing led by
CAD $115,000,000
served as the exclusive strategic
and financial advisor to
on its sale to
served as the exclusive strategic
and financial advisor to
on its growth
financing led by
USD $11,800,000
served as the exclusive strategic
and financial advisor to
a wholly-owned subsidiary of
on its sale to
served as the exclusive strategic
and financial advisor to
on its growth
financing led by
USD $32,000,000
served as the exclusive strategic
and financial advisor to
on its sale to
6
served as the exclusive strategic
and financial advisor to
on its sale to
served as the exclusive strategic
and financial advisor to
on its growth financing from
& existing investors
AUD $26,000,000

7. SUREPATH INSIGHTS
STATE OF SMB SOFTWARE – Q3 2019
surepathcapital.com
T h e S t a t e o f S M B S o f t w a r e i n Q 3 2 0 1 9
7
Welcome to our Q3 2019 State of SMB Software Report, looking at fundraising and exit activity in the
Small and Mid-Sized Business (SMB) software space in North America. To isolate the SMB deal activity,
we analyzed over 960 deals narrowing them down to 162 venture deals, 4 PE Growth and Buyout/LBO
deals, 7 M&A deals, and 3 IPOs representing ~$7B in deal proceeds to SMB software companies.
We track SMB software companies across three broad categories: Grow my Business (front office), Run
my Business (middle office) and Track my Business (back office).
We recently expanded on our usual coverage to go deeper on deal trends. The highlights for Q3
include a record high quarter for the Legal vertical,continueddominanceof the Restaurant Tech
vertical,and mixedperformance on this year's SMB IPOs.
Our SurePath SMB Index continuedto outperform the major indices in Q3 2019, growing >50% since the
start of 2019 compared to ~20% for the major indices.
We hope you find this report useful and invite you to get in touch to discuss it with us.
The SurePath team
October 2019

8. Lessons & Takeaways

9. SUREPATH INSIGHTS
STATE OF SMB SOFTWARE – Q3 2019
surepathcapital.com
Q3 2019 total deal value was down ~60% from Q2 2019. The total deal volume was ~35% lower compared to
the two previous quarters. The lack of ≥ $1B deals combined with the summer slowdown in July and August
caused Q3 2019 to be the lowest quarter of 2019, in terms of total deal value and volume.
56% of total Q3 2019 VC deal value was from September. Average monthly VCdeal value in July and August
was ~$800M, which was ~55% of the average VC deal value in Q2 2019. Summer slowdown was in full effect
during the first two months of Q3 2019.
M&A deal value was down 80% from Q2 2019. Acquisition of First Data ($22B) and InstaMed($600M) was
completed in Q3 2019 but was excludedfrom this quarter’s data as they were captured at their
announcement dates earlier this year.
A record-setting quarter for SMB Legal software: Clio’s $250M Series D funding round was the largest in that
industry since we have started trackingdeals. Digital transformation in the legal vertical is accelerating and
VCs are investingto create a clear winner in this vertical.
Restaurant Tech continues to assert its dominance in Q3 2019: Despite the general decrease in deal value and
volume this quarter, the Restaurant Tech vertical saw a $121M round from TouchBistro, which ranked in the top
5 largest deals in the Restaurant Tech space since Q1 2018.
Post IPO performance is mixed as of Q3 2019: Out of the 8 SMB IPOs in 2019, 4 of them are tracking below their
IPO price. Money-burning unicorns with low margins and high valuation suffered the most.
9
K e y T a k e a w a y s

10. SUREPATH INSIGHTS
STATE OF SMB SOFTWARE – Q3 2019
surepathcapital.com
The Legal vertical attracted ~5x more capital in Q3 vs. Usual quarterly $. This is from Clio’s $250M Series D raise in
September. Legal practices that serve SMBs are demanding software solutions to drive efficiency and VCs are rapidly
deploying capital to create a dominant player in this vertical.
1. Source: Pitchbook
2. Deal count excludes deals involving accelerators, incubators, crowdfunding and deals with undisclosed values.
10
L e g a l v e r t i c a l s e t s a n e w r e c o r d
$29M
$46M
$69M
$9M
$118M
$60M
$250M
2
3 3
2
7
2
1
0
1
2
3
4
5
6
7
8
-
$50M
$100M
$150M
$200M
$250M
Q1 2018 Q2 2018 Q3 2018 Q4 2018 Q1 2019 Q2 2019 Q3 2019
DealCount
CapitalRaised(inmillions,$USD)
CapitalRaised by Quarter for Legal
Capital Raised Deal Count
$250.M
$83.M
$50.M
$23.M
$10.3M
$6.9M
$4.5M
$0.4M
$0.3M
$0.1M
2019 YTD Capital Raiseby Legal
Clio Disco Litify Ironclad
Casetext Filevine Evisort PROOF
BlackBoiler Mayfair Project

11. SUREPATH INSIGHTS
STATE OF SMB SOFTWARE – Q3 2019
surepathcapital.com
$2,674M
$4,280M
$813M
$1,193M
-
$1,000M
$2,000M
$3,000M
$4,000M
$5,000M
$6,000M
FY 2018 YTD 2019
CapitalRaised(inmillions,$USD)
Venture CapitalRaised for Restaurant Tech
Other Restaruant Tech
R e s t a u r a n t T e c h ’ s d o m i n a n c e c o n t i n u e d i n
Q 3 2 0 1 9
11
$2,674M
$2,882M
$2,550M
$2,600M
$2,650M
$2,700M
$2,750M
$2,800M
$2,850M
$2,900M
CapitalRaised(inmillions,$USD)
Largest Restaurant Tech Raises since Q1 2018
$400M Q1 2019 Series F
$250M Q3 2018 Series E
$250M Q1 2019 Series E
$150M Q2 2019 Series D1
$121M Q3 2019 Series E
$115M Q3 2018 Series D
$100M Q2 2018 Series D
$88M Q2 2019 Series C
$70M Ritual Q2 2018 Series C
$55M Ritual Q2 2018 Series D
$50M Good Eggs Q2 2018 Series BB
12.3%
21.8%
Total capital raised for Restaurant Tech grew 47% YTD 2019 compared to FY 2018. In Q3 2019, TouchBistro raised a
$121M Series E round, ranking in the top 5 in the largest Restaurant Tech raises since Q1 2018. Despite a quiet Q3, the
Restaurant Tech vertical still leads the charge in terms of total capital raised, accounting for >20% of all vertical-
specific VC $.

12. SUREPATH INSIGHTS
STATE OF SMB SOFTWARE – Q3 2019
surepathcapital.com
As of September 30th 2019, 4 out of 8 SMB companies that IPOed in 2019 are performing above their IPO closing day
price. Lightspeed (TSE:LSPD) is the biggest gainer, performing 65% higher than its IPO price. The worst performer to-
date is Slack (NYSE:WORK), which has lost over 39% of its value since debuting through direct listing in June.
1. Source: Pitchbook
2. Graph compares the closing stock price with IPO closing stock price
12
P o s t I P O P e r f o r m a n c e
0.5
1
1.5
2
2.5
NYSE:WORK TSE:LSPD NYSE:PD NYSE:PINS NAS:ZM NYSE:MDLA ASX:SZL NASDAQ:DDOG

13. Q3 2019 SMB Software Deals

14. SUREPATH INSIGHTS
STATE OF SMB SOFTWARE – Q3 2019
surepathcapital.com
In Q3 2019, there were over 960 deals in the B2B
software space, globally.
875 deals were in North America
176 deals (162 venture deals, 7
M&A deals, 4 PE/Buyout/LBO
deals, and 3 IPOs) involved
companies with a clear SMB
software offering
1. Source: Pitchbook
2. Deal count excludes deals involving accelerators, incubators, crowdfunding and deals with undisclosed values.
14
M e t h o d o l o g y

15. SUREPATH INSIGHTS
STATE OF SMB SOFTWARE – Q3 2019
surepathcapital.com
Beginning in 2019, we updated our approach for tracking SMB software companies.While we continue
to track SMB software companies across three broad categories of Grow my Business (front office), Run
my Business (middle office) and Track my Business (back office),we have re-assessedand expanded
our sub-categories within each them as follows:
2 0 1 9 C h a n g e s t o S M B C a t e g o r i z a t i o n
Grow My Business
Sales Tech
Marketing Tech
Advertising Tech
E-Commerce
Social Media Management
Marketplace
Run My Business
HR Tech
Security / IT
Business Management / ERP
Practice Management
Productivity
Reputation Management
Booking
Customer Support
Websites
Member Management
Keep Track of My
Business
Accounting & Invoicing
Payments
Analytics
15

16. SUREPATH INSIGHTS
STATE OF SMB SOFTWARE – Q3 2019
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Q 3 2 0 1 9 S M B S o f t w a r e D e a l L a n d s c a p e
16
1. Source: Pitchbook
2. Deal count excludes deals involving accelerators, incubators, crowdfunding and deals with undisclosed values.
~$6.8B of capital was deployed across 176 deals in Q3 2019, which was ~40% of the deal value realized in Q2 2019.
There was a significant decrease in capital investment from M&A/PE/IPO exit activity, which decreased to $3.2B in Q3
2019 from $12.9B in Q2 2019. There was only 1 deal with ≥$1.0B deal size in Q3 2019, compared to 3 in Q2 2019, and 6
in Q1 2019.
$1,123M
$3,466M
$1,065M
$1,004M
$141M $51M
Total Capital Invested by Deal Type
Merger/Acquisition Early/Late Stage VC Buyout/LBO
IPO Angel/Seed PE Growth/Expansion
$2M
$35M $25M
$991M
$180M
$533M
63
99
2
3
6
2
0
20
40
60
80
100
$0M
$200M
$400M
$600M
$800M
$1,000M
DealCount
AverageDealSize(inmillions,USD)
AverageDeal Size by Deal Type
Average Deal Size Deal Count

17. SUREPATH INSIGHTS
STATE OF SMB SOFTWARE – Q3 2019
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1. Source: Pitchbook
2. Deal count excludes deals involving accelerators, incubators, crowdfunding and deals with undisclosed values.
Q 3 2 0 1 9 S M B S o f t w a r e D e a l s b y S t a t e
California saw the most deal activity representing ~36% of all deals, followed by New York which represented ~11% of
all deal. Colorado, Washington and Texas combined have been consistently contributing ~17% of total deal volume
over the past few quarters.

18. SUREPATH INSIGHTS
STATE OF SMB SOFTWARE – Q3 2019
surepathcapital.com
Q 3 2 0 1 9 ’ s T o p S M B S o f t w a r e R a i s e s
$200M Generation Investment Management /
Fidelity Management & Research / others
$200M SoftBank Vision Fund / others
$160M T. Rowe Price / others
$150M Koch Disruptive Technologies / others
$121M OMERS Growth Equity/ others
$326M Allianz X / MUFG Innovation Partners / GMO
Internet Group / others
$300M Salesforce Ventures
$250M Andreessen Horowitz / General Catalyst /
Sequoia Capital
$250M JMI Equity / TCV
$225M GPI Capital / others
18
1. Source: Pitchbook
2. Deal count excludes deals involving accelerators, incubators, crowdfunding and deals with undisclosed values.

19. SUREPATH INSIGHTS
STATE OF SMB SOFTWARE – Q3 2019
surepathcapital.com
S M B V e n t u r e F u n d i n g i n Q 3 2 0 1 9
162 SMB software companies raised venture capital in Q3 2019 – average deal size was 26% higher compared to Q2
2019. ~61% of the deal volume and ~96% of deal value was in early and later stage VC investments, consistent with Q2
2019. The average round was ~$11M for early stage and ~$68M for later stage.
19
1. Source: Pitchbook
2. Deal count excludes deals involving accelerators, incubators, crowdfunding and deals with undisclosed values.
$37M
$104M
$613M
$2,853M
30
33
57
42
0
10
20
30
40
50
60
-
$500M
$1,000M
$1,500M
$2,000M
$2,500M
$3,000M
Angel Seed Round Early Stage VC Later Stage VC
DealCount
CapitalRaised(inmillions,$USD)
CapitalRaised by Venture Deal Type
Capital Raised Deal Count

20. SUREPATH INSIGHTS
STATE OF SMB SOFTWARE – Q3 2019
surepathcapital.com
52
14
96
$1,332M
$424M
$1,851M
Grow My Business
Keep Track of My Business
Run My Business
V e n t u r e D e a l s b y C a t e g o r y
Outer ring representstotal
capital invested by
categoryand inner ring
representstotal deal count
by category
We track SMB software
companies across three
broad categories:
• Grow my Business:
Marketing / front office
• Run my Business:
Typically vertical apps
to help operate
(business management,
ERP, etc.)
• Track my Business:
Billing, accounting, etc.
1. Source: Pitchbook
2. Deal count excludes deals involving accelerators, incubators, crowdfunding and deals with undisclosed values.
20
SMB software companies raised ~$3.6B across 162 deals in Q3 2019. Of those, companies that helped SMBs grow and
run their business attracted ~88% of deal value ~91% of deal volume in the SMB software space.

21. SUREPATH INSIGHTS
STATE OF SMB SOFTWARE – Q3 2019
surepathcapital.com
41
4
19
3
9
15
11
14
20
3
2
2
5
3 1 2 3 2 3
$799M
$583M
$445M$374M
$354M
$308M
$258M
$158M
$148M
$66M
$29M
$27M
$24M
$19M $5M $4M $3M$2M$1M
Business Management/ERP
Financing
HR Tech
Websites
Payments
Marketplace
Sales Tech
Mar Tech
Productivity
Accounting/Invoicing
Booking
Practice Management
Ad Tech
Security/IT
Member Management
Analytics
Reputation Management
Customer Support
E-Commerce
V e n t u r e D e a l s b y C a t e g o r y ( c o n t . )
1. Source: Pitchbook
2. Deal count excludes deals involving accelerators, incubators, crowdfunding and deals with undisclosed values.
21
Amongst our 19 SMB software categories, Business Management/ERP companies attracted the highest amount of VC
in Q3 2019. Financing companies had the second highest amount of capital raised due to the $326M Gusto deal in
September 2019.

22. SUREPATH INSIGHTS
STATE OF SMB SOFTWARE – Q3 2019
surepathcapital.com
109
31
22
$2,759M
$698M
$150M
Both
Medium
Small
V e n t u r e D e a l s b y T a r g e t C u s t o m e r
1. Source: Pitchbook
2. Deal count excludes deals involving accelerators, incubators, crowdfunding and deals with undisclosed values.
22
~67% of venture funding in Q3 2019 went to companies with a broad offering for both the small and medium segments
of the SMB software space – a similar proportion to that realized throughout 2017, 2018 and Q1 and Q2 2019. Having
offerings for both small and larger businesses gives vendors the ability to satisfy the needs of a broader market and
grow with their customers.

23. SUREPATH INSIGHTS
STATE OF SMB SOFTWARE – Q3 2019
surepathcapital.com
1
5
8
4
6
2
4
8
5
2
25
$250M
$186M
$157M
$73M
$64M
$49M
$43M
$37M
$37M
$15M
$59M
Legal
Retail
Restaurants
Hospitality
Cannabis
Salons & Spas
Creatives
Real Estate
Healthcare
Home Services
Other
V e r t i c a l - S p e c i f i c V e n t u r e D e a l s
1. Source: Pitchbook
2. Deal count excludes deals involving accelerators, incubators, crowdfunding and deals with undisclosed values.
23
Across 23 disctinct verticals, we saw 70 deals with a total of ~$970M raised in Q3 2019. Top 10 verticals represented
~94% of vertical-specific deal value and ~64% of volume, largely consistent with what we saw in Q1 2019. The $250M
investment in Clio put the Legal vertical in the top category.

24. SUREPATH INSIGHTS
STATE OF SMB SOFTWARE – Q3 2019
surepathcapital.com
Q 3 2 0 1 9 P E S M B D e a l s
1. Source: Pitchbook
2. Deal count excludes deals involving accelerators, incubators, crowdfunding and deals with undisclosed values.
24
$41M Caisse de dépôt et placementdu Québec
Growth/Expansion
$10M Boathouse Capital
Growth/Expansion
$1B Vista Equity Partners
Buyout/LBO
$65M Realtime Electronic Payments
Buyout/LBO

25. SUREPATH INSIGHTS
STATE OF SMB SOFTWARE – Q3 2019
surepathcapital.com
2
1
1
$1,041M
$65M
$10MRun My Business
Keep Track of My Business
Grow My Business
P E G r o w t h / B u y o u t D e a l s b y C a t e g o r y
1. Source: Pitchbook
2. Deal count excludes deals involving accelerators, incubators, crowdfunding and deals with undisclosed values.
25
In Q3 2019, private equity investors deployed ~$1.1B of capital into companies serving the SMB space, an increase of
223% compared to the deal value in Q2 2019. ~90% of total deal value was from the $1.0B Acquia Buyout/LBO.

26. SUREPATH INSIGHTS
STATE OF SMB SOFTWARE – Q3 2019
surepathcapital.com
1
11
1
$1,000M
$65M
$41M $10M
Websites/CMS
Payments
HR Tech
Mar Tech
P E G r o w t h / B u y o u t D e a l s b y C a t e g o r y ( c o n t . )
4 SMB software companies that received funding or was acquired by private equity investors in Q3 2019 was evenly
split between 4 different categories. In terms of deal proceeds, Websites/CMS category took the lead this quarter,
from the $1B buyout of Acquia.
1. Source: Pitchbook
2. Deal count excludes deals involving accelerators, incubators, crowdfunding and deals with undisclosed values.
26

27. SUREPATH INSIGHTS
STATE OF SMB SOFTWARE – Q3 2019
surepathcapital.com
3
1
$1,106M
$10MBoth
Medium
P E G r o w t h / B u y o u t D e a l s b y T a r g e t C u s t o m e r
1. Source: Pitchbook
2. Deal count excludes deals involving accelerators, incubators, crowdfunding and deals with undisclosed values.
27
75% of total private equity deal volume in Q3 2019 was from companies with offering for both the small and medium
segments. Consistent with the previous quarters, PEs continue to focus on mature companies with wide offerings
across the SMB spectrum.

28. SUREPATH INSIGHTS
STATE OF SMB SOFTWARE – Q3 2019
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1. Source: Pitchbook
2. Deal count excludes deals involving accelerators, incubators, crowdfunding and deals with undisclosed values.
Q 3 2 0 1 9 S M B S o f t w a r e M & A D e a l s
$450M Acquired by Shopify
Announced
$410M Acquired by DoorDash
Announced
$118M Acquired by Logitech
Completed
$92M Acquired by StepStone
Completed
$42M Acquired by Medallia
Completed
$15M Acquired by IAC
Completed
$10M Acquired by Endurance International Group
Announced
28

29. SUREPATH INSIGHTS
STATE OF SMB SOFTWARE – Q3 2019
surepathcapital.com
M & A D e a l s b y C a t e g o r y
1. Source: Pitchbook
2. Deal count excludes deals with undisclosed values.
29
The cumulative value of all mergers and acquisitions (with disclosed proceeds) in the SMB software space in Q3
was ~$1.1B across 7 deals. Fiserv’s $22B acquisition of First Data was completed in Q3 2019. However, since the deal
was announced in Q1 2019, it was not captured in this quarter.
3
4
$870M
$254M
Grow My Business
Run My Business

30. SUREPATH INSIGHTS
STATE OF SMB SOFTWARE – Q3 2019
surepathcapital.com
M & A D e a l s b y C a t e g o r y ( c o n t . )
30
1. Source: Pitchbook
2. Deal count excludes deals with undisclosed values.
Companies that provide Business Management/ERP and HR Tech had the largest deal volume in Q3 2019. From
deal value perspective, the E-Commerce category showed the highest proceeds, driven by the 6 River Systems
acquisition.
2
1
1
2
1
$460M
$410M
$118M
$94M
$42M
E-Commerce
Marketplace
Business Management/ERP
HR Tech
Customer Support

31. SUREPATH INSIGHTS
STATE OF SMB SOFTWARE – Q3 2019
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M & A D e a l s b y T a r g e t C u s t o m e r
31
1. Source: Pitchbook
2. Deal count excludes deals with undisclosed values.
Consistent with the previous quarters, ~86% of M&A activity in Q3 2019 involved companies with a broad offering for
both the small and medium segments of the SMB software space.
6
1
$1,045M
$79M
Both
Medium

32. SUREPATH INSIGHTS
STATE OF SMB SOFTWARE – Q3 2019
surepathcapital.com
IPO/Filing Date July 19 July 30 September 19
Status Complete Complete Complete
Amount Raised/Expected $326M $30M $648M
Age at IPO 18 Years 3 Years 9 Years
Annual Revenue at IPO $337M $4M $266M
Headcount at IPO 1,258 47 1,212
Pre-IPO Investors
Saints Capital, Sequoia Capital,
TriplePoint Venture Growth
Bastion Capital, Continental
Investors, CSC UpShot Ventures, E-
Merge, Hone Capital, Securian
Financial Group, Target + METRO
Retail Accelerator
Amplify Partners, Battery Ventures,
Bob Pasker, Comcast Ventures,
Contour Venture Partners,
Genacast Ventures, IA Ventures,
ICONIQ Capital, Index Ventures,
IVP, Jerry Neumann, Meritech
Capital Partners, Neu Venture
Capital, NYC Seed, NYC
SeedStart, OpenView Venture
Partners, Polaris Partners, Raju
Rishi, RRE Ventures, RTP Ventures
Q 3 2 0 1 9 ’ s S M B S o f t w a r e I P O s
(NASDAQ:DDOG)
32
(NYSE:MDLA)
1. Source: Pitchbook
2. Deal count excludes deals with undisclosed values.
(ASX: SZL)

33. The SurePath SMB Index

34. SUREPATH INSIGHTS
STATE OF SMB SOFTWARE – Q3 2019
surepathcapital.com
Introduced in 2016, the SurePath SMB Index originally tracked 35 publicly traded companies that serve the SMB
market and their performance against other benchmark indices. Over time, as companies in the index have been
acquired, and other relevant companies have publicly listed, the current number of constituents is 37.
Examined280+ Annual Reports of Publicly
Traded Companies
Selection of Companies for SMB
Focus
SurePath SMB Index
T h e S u r e P a t h S M B I n d e x
Final Selection of 37
Companies
34

35. SUREPATH INSIGHTS
STATE OF SMB SOFTWARE – Q3 2019
surepathcapital.com
2 0 1 9 C h a n g e s t o S M B I n d e x
During the first quarter of 2019 we added 6 relevant companies that IPOed. These are companies that are making it
easier for SMBs to move faster (Dropbox and DocuSign), gather feedback from customers and employees
(SurveyMonkey), improve the current and prospective employee experience (Ceridian), sell to customers easier and
more efficiently (Lightspeed), and more.
8 of the original constituents of our SMB Software Index were removed during this period following the completion of
their acquisition. ShoreTel (acquired by Mitel), Web.com (acquired by Sirus Capital), FirstData (acquired by Fiserv),
and Mindbody (acquired by Vista Equity Partners).
35

36. SUREPATH INSIGHTS
STATE OF SMB SOFTWARE – Q3 2019
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I n d e x C o n s t i t u e n t s
36

37. SUREPATH INSIGHTS
STATE OF SMB SOFTWARE – Q3 2019
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80%
100%
120%
140%
160%
180%
200%
220%
240%
260%
1/4/2016
3/4/2016
5/4/2016
7/4/2016
9/4/2016
11/4/2016
1/4/2017
3/4/2017
5/4/2017
7/4/2017
9/4/2017
11/4/2017
1/4/2018
3/4/2018
5/4/2018
7/4/2018
9/4/2018
11/4/2018
1/4/2019
3/4/2019
5/4/2019
7/4/2019
9/4/2019
SurePath SMB Index S&P 500 Nasdaq Dow Jones
S u r e P a t h S M B S o f t w a r e I n d e x S u m m a r y
37
SurePath SMB index continues to outperform the general
market - appreciating by 55% in 2019 vs. an average of 20%
for the benchmark indices
Company Ticker
Market Cap
(billions)
Automatic Data Processing, Inc. ADP $70.01
Intuit Inc. INTU $69.16
Shopify Inc. SHOP $35.92
Atlassian Corporation Plc TEAM $30.36
Paychex, Inc. PAYX $29.64
Square, Inc. SQ $26.46
Paycom Software, Inc. PAYC $12.24
GoDaddy Inc. GDDY $11.78
DocuSign DOCU $10.90
RingCentral, Inc. RNG $10.43
Sage Group plc LON:SGE $9.26
Dropbox DBX $8.34
Zendesk, Inc. ZEN $8.09
Ceridian CDAY $7.07
HubSpot, Inc. HUBS $6.44
Xero Limited. ASX:XRO $5.97
Wix.com Ltd. WIX $5.97
GrubHub Inc. GRUB $5.13
H&R Block, Inc. HRB $4.74
LendingTree, Inc. TREE $4.03
Cimpress N.V. CMPR $3.98
ANGI Homeservices Inc. ANGI $3.60
New Relic, Inc. NEWR $3.59
AppFolio, Inc. APPF $3.24
Qualys, Inc. QLYS $2.97
Yelp Inc. YELP $2.47
SurveyMonkey SVMK $2.28
Deluxe Corp. DLX $2.11
LightSpeed POS LSPD $1.95
Groupon, Inc. GRPN $1.51
Eventbrite EB $1.47
Stamps.com Inc. STMP $1.28
Shutterstock, Inc. SSTK $1.27
LendingClub Corporation LC $1.14
Endurance International Group Holdings, Inc. EIGI $0.55
Carbonite, Inc. CARB $0.54
Marchex, Inc. MCHX $0.14
$1bn Market Cap Club (in Grey)
Market Cap by Index Constituents (in US$ b)

38. SUREPATH INSIGHTS
STATE OF SMB SOFTWARE – Q3 2019
surepathcapital.com
Q 3 2 0 1 9 P e r f o r m a n c e b y C o n s t i t u e n t
38
Stamps.com made a big comeback in Q3 2019. The company shared encouraging quarterly results and increased its
full-year outlook, which increased their stock price by 64.9% in Q3. Cimpress and DocuSign followed suit, appreciating
45.9% and 22.3% respectively. ANGI Homeservices struggled to meet the analyst estimates and slashed its full-year
adjusted EBITDA, which depreciated its stock by 44.8% in this quarter.

39. SUREPATH INSIGHTS
STATE OF SMB SOFTWARE – Q3 2019
surepathcapital.com
The Leading Financial Advisor in SMB Software
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FOCUS
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COMMITMENT
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T h e S u r e P a t h D i f f e r e n c e

40. Toronto • San Francisco
Mark MacLeod
Founder & President
mark@surepathcapital.com
416.843.6004
Josh Scherman
Vice-President
josh@surepathcapital.com
646.420.0074
Danial Shaikh
Associate
danial@surepathcapital.com
647.876.5453
Sara Defina
Analyst
sara@surepathcapital.com
416.689.2474
KJ Lee
Analyst
KJ@surepathcapital.com
647.500.3457
Erik Mosney
Analyst
erik@surepathcapital.com
519.239.5759
40