While the software-as-a-service (SaaS) industry is poised for significant growth, revenue multiples are projected at a three-year low, averaging a prepandemic level of about 5.5%, according to a report from FirstPageSage. During the third quarter of 2021, valuations hit a record high of 9.8x, and the projections represent “such a dramatic decrease [that] is both a comment on the economic impact of global events (e.g., inflation or Russian invasion of Ukraine) as well as the volatile nature of SaaS and the tech sector as a whole.” The report provides SaaS valuation multiples for ranges of EBITDA, revenue, and seller’s discretionary earnings (SDE) and for various business types. The report points out that, while most companies often rely on EBITDA, the “vast growth potential and large sunk investments in growth for SaaS companies often means that SDE or revenue-based valuations are more valuable within this industry.”