Valuation Trading Multiples & Precedent Transactions: Payroll & HCM Software Companies
Valuation benchmarks for Payroll & HCM Software Companies. Access public trading comps, EV/EBITDA acquisition multiples, and private market data for pitch books and valuation analysis.
1.1 - Payroll & HCM Software Companies Market Context & Valuation Drivers
Companies in this trading comparable group are public providers of payroll and human capital management software and services. They deliver cloud platforms that automate payroll, tax filing, benefits, time tracking, and core HR workflows for SMBs through enterprises. Comparable positioning stems from recurring subscription and transaction revenue, high compliance-driven stickiness, and similar go-to-market across direct sales and channel partnerships, making them useful valuation benchmarks and public trading comparables.
Typical capabilities include end‑to‑end payroll processing with tax remittance, garnishments, and year‑end filings; benefits administration and enrollment; time and attendance; core HR and employee records; talent acquisition plus performance and learning management; employee self‑service and mobile access; workforce analytics and reporting; integrations and APIs to accounting/ERP and payments; and, in some cases, outsourced HR/PEO services. Many also provide multi‑jurisdiction compliance, onboarding, and document management.
Primary customers include small and mid‑market businesses, enterprise HR departments, and accounting/finance teams. Key valuation benchmarks are recurring revenue mix and ARR growth, gross margins from software versus services, net revenue retention and churn, and operating efficiency metrics such as Rule of 40, CAC payback, and client processing volumes. Outcomes sought are lower admin costs, stronger compliance, and improved employee engagement and productivity.
2. Valuation Analysis: Public Trading Comps & Multiples for Payroll & HCM Software Companies companies
2.1 - Public Peer Groups & Median Valuation Multiples for Payroll & HCM Software Companies sector
Comparable group 1: Payroll & HCM Software Companies
Automatic Data Processing
- Enterprise value: $●●●m
- Market Cap: $●●●m
- EV/Revenue: ●.●x
- EV/EBITDA: ●●.●x
- Description: Provider of cloud-based human capital management solutions that unite HR, payroll, talent, time, and tax functionalities. Serving businesses of all sizes with expertise to support organizational goals and employee potential.
- Key Products:
- Payroll Processing: Ensures timely and accurate payment to employees with tax compliance
- Time and Attendance: Tracks employee hours and simplifies scheduling
- Talent Management: Streamlines recruitment, performance management, and employee development
- Benefits Administration: Manages employee benefits, including health insurance and retirement plans
- HR Outsourcing: Provides comprehensive HR support including compliance and best practices.
Intuit
- Enterprise value: $●●●m
- Market Cap: $●●●m
- EV/Revenue: ●.●x
- EV/EBITDA: ●●.●x
- Description: Provider of financial technology solutions including software for accounting, personal finance, tax preparation, and business management, empowering individuals and small businesses to streamline financial tasks, optimize financial decisions, and enhance overall financial well-being.
- Key Products:
- QuickBooks: Accounting software for small businesses, managing finances, invoicing, and payroll
- TurboTax: Tax preparation software for filing individual and business tax returns
- Credit Karma: Personal finance platform offering credit scores, financial recommendations, and monitoring
- Mailchimp: Marketing automation platform for email marketing, audience management, and analytics
- Mint: Personal finance app for budgeting, expense tracking, and financial planning.