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The Clearwater Cloudex index compares 33 listed companies. The vast majority are American-based, as the US continues to lead the way in providing software as a service (SaaS) to the public market. The index rose 1% between the 1st August  and 31st August.  This compared to a 1% fall for the NASDAQ index and 2% for FTSE techmark all share.

One of the strongest performers in the index was Box Inc whose shares hit a 52 week high this month. Box provides software that enables users to share files and collaborate on projects with unlimited storage. Box has recurring revenues of 70% and has managed to achieve that rare feat in Silicon Valley using cash to fund growth and rewarding investors with profits later. Box unlike its closest rival Dropbox relies on users that are almost all paying a monthly subscription fee. The Gartner Magic Quadrant has recognised Box as a ‘Leader in Enterprise File Sync and Share’ three years running, edging out a higher position over Dropbox Enterprise. Its revenue growth has exceeded 30% in almost every quarter. It differentiates itself from the competition with its add on features including security features and API extension capabilities. Its Fortune 500 customers have largely stayed very loyal.

Average EV/EBITDA trading multiples dropped for the fourth quarter in a row. In the second quarter of 2017 they stood at 32.8x, a fair distance away from their highpoint of 51.8x in the fourth quarter of 2014. The appetite for cloud companies still appears strong, but it suggests that our hypothesis that the gap between cloud companies and traditional technology firms is significantly narrowing seems to be playing out, as traditional technology firms outperformed the Cloudex index this quarter.


Cloudex-listed-multiples-June 17


Find out how we calculate the index here. 


Our infographic summarises the key findings from the last quarter.


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