Private equity pays 11× ARR for top tech assets – and nothing for the rest

In episode 3 of Founders Dispatch, the Trending Topics podcast, Stefan Köppl, Managing Partner of Samira Advisors, talks with Jakob Steinschaden about where tech valuations stand this autumn. The episode's title sums up the market: buyers have their pockets full of money and have to deploy it. But they have become very selective about where.

In one minute

• The old rule of thumb of ten times ARR is gone. For top assets with strong growth and no damage from AI, private equity now pays eleven times annual revenue and more.
• Companies that don't meet those criteria often get no offer at all. The market has split rather than moved.
• Strategic buyers pay a premium, but they are slow and hard to predict, and a deal can fall apart when the internal champion changes jobs.
• In the AI era the product alone rarely protects a company. Distribution and brand matter more.

Valuations: two markets, not one

Recent deals show how the business works, from the sale of myflexbox to Deutsche Post to foodora Austria's move to SSW Partners. At the top end, private equity's world is converging with venture capital's, where AI-native startups are valued at around 21 times revenue according to a recent study. Below that bar, interest drops off sharply.

The private equity playbook

Stefan and Jakob walk through how financial investors build value: a platform investment, then add-on acquisitions bought at lower multiples than the platform is valued at (multiple arbitrage). In tech, the aim is usually to grow revenue rather than to cut costs.

Strategic buyer or financial investor?

Corporates can pay a strategic premium because a target is worth more inside their business. The trade-off is speed and certainty: processes take longer, priorities shift, and when the person who championed the deal internally moves on, the deal often goes with them.

A media house turned private equity firm

The episode looks at RM Equity Partners, which grew out of the Vorarlberg media house Russmedia into an independent private equity firm with around EUR 500 million under management, and which also buys consumer (B2C) businesses.

The end of the mission-driven founder?

Successful founders such as Monzo's Tom Blomfield are joining the large AI labs, and targeted acquihires of individual team members are becoming a problem for early-stage VCs.

What is a moat in the AI era?

If a product can be rebuilt quickly, distribution channels and brand become the real defence. The example of fonio.ai raises the question whether "seed-strapping" – raising one round and then growing on revenue – is really enough.

The IPO window

The IPO rumours around Bitpanda have faded, the Finnish smart-ring maker Oura has called off its listing, and the market is waiting for Anthropic's IPO.

What this means if you are selling

• Know which side of the line you are on — Growth and resilience to AI decide whether buyers compete for you or don't call back. Make both visible in your numbers and your equity story.
• Talk to both kinds of buyer — A strategic premium is worth having, but a financial investor in parallel keeps the process moving if the corporate slows down.
• Have more than one champion — In a corporate process, build relationships beyond the one person who brought the deal in.

This conversation first appeared on Founders Dispatch, the podcast of Trending Topics. Listen to the full episode (opens in a new tab)