Jamf, the Apple-focused infrastructure and security platform provider, filed for a $100M IPO (placeholder figure) with Goldman Sachs leading the IPO. The company is majority-owned by Vista, a software-focused private equity firm and has not yet picked an exchange. Jamf is now the 4th SaaS IPO to file this year (Procore, ZoomInfo, nCino) and second in the past few weeks as nCino just filed as well. Jamf helps businesses of all kinds connect, manage and protect Apple products, applications and corporate resources all in the cloud without ever needing to touch the devices. The company has been around since 2002 and has a long relationship with Apple. They are certainly riding the wave of more Apple devices inside enterprises and are the largest infrastructure and software platform built specifically for enterprise deployments of the Apple product ecosystem. The company's mission is to "help organizations succeed with Apple" and with Jamf's software "Apple devices can be deployed to employees brand new in the shrink-wrapped box, set up automatically and personalized at first power-on and administered continuously throughout the life of the device." A core tenant of Jamf's technology is preserving the native Apple experience which consumers love while enabling the security, privacy and management needs of large enterprises.
Jamf has 40,000+ customers across 100+ countries and their customers have deployed 16M Apple devices. The company's revenue is scaling fast with $204M of revenue in 2019, up 39% year-over-year and they ended March 31st with $224.9M of ARR (annual recurring revenue), up 40% year-over-year. Jamf is based in Minneapolis, MN, and has 1,284 full-time-employees (FTEs). They were founded in 2002 and acquired by Vista in 2017 for $733.8M. A key milestone timeline graphic from the S-1 is below.
Jamf's platform provides a solution for the full lifecycle enterprise IT management of Apple devices and is built to serve both technical and non-technical users within their customers. The company is very focused on user experience (much like Apple) and often speaks about the consumerization of IT and how consumers expect the same experiences with their enterprise software tools that they get in their personal lives--the company's software preserves the native Apple experience. Jamf has 5 main products and manages Mac, iPad, iPhone and Apple TV devices (more below). The Jamf platform spans use-cases such as provisioning and deployment, operating system updates, application lifecycle management and licensing, endpoint security and protection, secure access to resources, and is all wrapped in a self-service UX enabling users to update and install applications with one click.
The company launched its SaaS offering in 2012 and a top priority has been to both transition perpetual license customers to their SaaS offering and to only focus on new sales of their SaaS products. The company also has 100+ integrations and value-added solutions on the Jamf Marketplace. An image of their product suite from the S-1 is below.
Summary Metrics and GTM (Go-to-Market)
As of last quarter, 83% of Jamf's revenue was from subscriptions (which has been growing as a percentage of total revenue over the past few quarters). The company has a multi-faceted GTM approach and focuses on selling to companies of all sizes and industries. Their direct sales team focuses on selling to larger companies / complex deployments and is segmented with field and inside sales teams organized by customer size and then further segmented by new logo vs. upsell focus. Jamf also has a network of 200+ channel partners globally that resell the products, which represents ~50% of total sales (46% of bookings in 2019). Apple is not surprisingly a huge partner (and customer) and represented 6% of total bookings for 2019, although they did just acquire a competitor, Fleetsmith (more on that later). For smaller companies, Jamf can be sold through a self-serve motion without speaking to a sales rep. The company does not disclose any information on sales cycles. Jamf also hosts the world's largest Apple IT online community, Jamf Nation, which has 100,000+ members that share commentary and ideas around Jamf's products. The company notes that many customers started with a free trial of the product before buying more or engaging with sales. Contracts are generally 1 year and while the company doesn't talk much about pricing in their S-1, they have this pricing page on their website which charges per month fees by product line and device.
As with many SaaS companies, Jamf focuses on a "land and expand" strategy and their dollar-based net retention rate has been 115%+ the last 9 quarters. Taking their reported ARR and dividing it by total customers, the average customer paid ~$5,800 in ACV (annual contract value) last quarter. Given they have acquired a few businesses and their customers and they don't release much about paying customers over certain revenue thresholds, that number is likely directionally correct but could be somewhat off from the real number. No single customer accounts for more than 1% of annual revenue. Below are more stats on the business as well as industry stats from the S-1:
Jamf cites a Frost & Sullivan report that estimates the global total TAM (total addressable market) for Apple Enterprise Management to be $10.3B in 2019 and growing to $23.4B by 2024, a CAGR (compound annual growth rate) of 17.8%. Given the growth of Apple devices in the enterprise, the increase in new products like the Apple Watch, and Jamf's leadership position, they certainly have a large opportunity to go after.
Jamf calls out products from larger companies such as VMWare, Microsoft and IBM that compete on a single use-case but are built for multiple platforms, not solely the Apple platform like Jamf. They call out "a number of early-stage companies" that are following their approach but mention none have enough scale to be real competitors. Apple just acquired Fleetsmith for an undisclosed price, so that likely put a thorn in the side of Jamf's long-term and deep relationship with Apple. Apple is not only a huge channel partner but also a customer of Jamf's products since 2010 and it will be interesting to see what Apple does with Fleetsmith over time. Jamf is clearly the market leader in the Apple ecosystem and while Fleetsmith could compete more under Apple's watch, Apple wouldn't want to alienate their ecosystem partners. Jamf did mention this in their S-1:
"Apple recently acquired Fleetsmith and Apple's business strategy with respect to the integration of Fleetsmith's platform in Apple's offerings is in its early stages. We believe this platform is primarily focused on the Mac and U.S.-based SMB customers and does not currently directly compete with our complete Apple Enterprise Management solutions. In the future, however, Apple could leverage this platform, whether through additional investment or the consolidation of other competitors of ours, to compete more directly with the scale and breadth of product offerings we provide. As a result of any such industry consolidation, our competitive position and our ability to retain or increase market share and revenue in our markets could be materially adversely affected."
As I mentioned in the product section, a few of Jamf's more recent products have come through acquisition, which is typical for many private equity-owned businesses. An output of those are below:
Investors and Ownership
Unfortunately, the ownership section of this S-1 is blank (it will be updated in subsequent filings), but Jamf is majority-owned by Vista, which acquired the company in Nov-2017 for $733.8M. As you can see later in this post in the valuation section, Vista stands to make a massive gain on this acquisition if the company trades like other high-growth public SaaS companies. Prior to their acquisition by Vista, Jamf had raised a total of $50M in primary and secondary from investors including Battery Ventures, Summit Partners, Dell Technologies Capital, and Sutter Rock Capital, according to Pitchbook. It's not clear if those investors rolled any of their equity ownership into the Vista deal (Vista is the only 5%+ shareholder listed although their total ownership is blank in this filing). Private equity buy-outs have become more viable exit strategies for SaaS companies, but it's rarer for them to acquire a business then take it public soon thereafter. Although some examples include Ping Identity (also owned by Vista) and SailPoint (owned by Thoma Bravo). I'll update this post once the new filing comes out with specific ownership percentages.
Financials and Other Metrics Outputs
Jamf has scale and is growing quickly and efficiently. They ended last quarter at $225M of ending ARR (they report ARR) which is up 40% YoY. Total revenue has been growing ~40% YoY for the past 5 quarters and dollar-based net retention is strong and similar to other SaaS companies at 120% last quarter. Subscription revenue as a percentage of total revenue is rising quickly and non-GAAP gross margins were ~80% last quarter. Moreover, the company is in the black (positive) with a 7% non-GAAP operating income margin and 9% adjusted EBITDA margin last quarter. Their implied months to pay back, which is the inverse of a CAC ratio (implied net new ARR multiplied by non-GAAP gross margin divided by non-GAAP sales and marketing spend of the prior quarter), was at a 15-month median over the past 8 quarters. Unlike most SaaS IPOs, the company is private-equity owned and has $200M+ in debt. Outputs of other metrics are below:
Historical P&L & Metrics ($000's)
Quarterly Revenue ($M)
Implied Ending ARR ($M)
Jamf added $16.6M of implied net new ARR over the past quarter and $71.3M over the past year. The actuals they report have them adding $64.3M of net new ARR over the past year (they only disclose ARR for certain periods so using the implied figure here).
As I mentioned, they only report actual ARR for a few quarters and I outputted it next to their implied ending ARR above (quarterly subscription + recurring revenue * 4). The numbers are smaller on the implied ending ARR side but are close to actuals.
Quarterly non-GAAP Gross Margin and Operating Expenses as a % of Revenue
Non-GAAP Gross Margin Mix
GAAP and Non-GAAP Operating and Net Income / (Loss) Margins
Subscription, License and Professional Services % Revenue Mix
Americas and Other Regions % Revenue Mix
Dollar-Based Net Retention Rate and Cohort Output
As mentioned, Jamf has strong dollar-based net retention like other successful public SaaS companies and has consistently been over 115% in the disclosure period (see below).
They also disclose a cohort graphic for customers by year. The company mentions the following on their cohorts.
"Each cohort represents our customers who made their first subscription purchase in the given fiscal year. For example, customers in the 2017 cohort are represented by customers who first purchased our subscription software between January 1st, 2017 and December 31st, 2017. They accounted for $16.2 million in ARR as of December 31, 2017 and grew to $27.4 million in ARR as of December 31, 2019. This represents a 1.7x multiple over two years with a CAGR at 30%. The rate of ARR expansion has been increasing with each new cohort, especially as the introduction of newer value-added products is just beginning to have an impact. This expansion within our customer base has historically been faster for our commercial customers as compared to our education customers."
Sales Efficiency and Payback Periods
Jamf doesn’t release customer counts by quarter, but the below output plots their implied months to payback using the inverse of a CAC ratio (net new ARR multiplied by non-GAAP gross margin divided non-GAAP sales and marketing spend of the prior quarter). The magic number is defined as net new ARR divided by non-GAAP sales and marketing spend of the prior quarter. For their scale, their sales efficiency is strong. The median months-to-pay-back over the disclosure period is 15.1 months.
Cash Flows ($M)
Quarterly GAAP P&L (000's)
Jamf will look to trade like other high-growth SaaS companies: on a multiple of forward revenue. The output below uses NTM (next-twelve-months) revenue based on an illustrative range of growth rates and comparable EV (enterprise value) / NTM revenue multiples from other public, high-growth SaaS businesses. It also includes an implied ARR multiple range. As mentioned in other posts, companies do not release projections or guidance in S-1's. We're at all-time highs for SaaS multiples so Jamf / Vista picked a good time to public. Jamf isn't growing as fast as some other SaaS companies, but they are not burning much money and are profitable on a non-GAAP operating income-basis. Vista acquired Jamf for ~$734M in 2017 and stands to make a massive return in a short period of time if Jamf trades in the range below and like other high-growth public SaaS companies.
Jamf is a market leader in device management for the Apple ecosystem, which is growing rapidly in the enterprise and companies will need a solution to manage and secure their ever-growing amount of Apple products. While it's a great ecosystem, it does come with some risk, particularly as Apple, which represents a meaningful portion of Jamf's bookings (6% last year), just bought a small competitor, Fleetsmith, weeks ago. Time will tell what Apple plans to do with Fleetsmith but it would be hard for them to disintermediate an important ecosystem partner like Jamf. With that said, it's not a great outcome for Jamf. Given Jamf's market leadership positioning, scale, efficiency, and tailwinds in riding the Apple device ecosystem into the enterprise, they have a strong story for public market investors. Another area of focus will be on the relatively low dollar-value Jamf is demanding from customers (and many large ones too) and they will need to tell a story for both product expansion as well as more premium, higher enterprise pricing i.e. they need to show they can charge more for their products over time. Given the buying frenzy of SaaS companies over the past 6 months, multiples have come up to all-time highs and seemingly there's been no better time to go public for a SaaS company, and we're likely to see more sponsor-owned IPOs like Jamf. I suspect the company (and Vista!) should do very well in the public markets.
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