{"id":309867,"date":"2025-03-10T13:18:45","date_gmt":"2025-03-10T20:18:45","guid":{"rendered":"https:\/\/www.saastr.com\/?p=309867"},"modified":"2025-03-10T12:10:12","modified_gmt":"2025-03-10T19:10:12","slug":"ai-saas-leader-moveworks-sells-for-2-8-billion-but-do-most-of-their-investors-make-any-money","status":"publish","type":"post","link":"https:\/\/www.saastr.com\/ai-saas-leader-moveworks-sells-for-2-8-billion-but-do-most-of-their-investors-make-any-money\/","title":{"rendered":"AI SaaS Leader Moveworks Sells for $2.85 Billion. But Do Most of Their Investors Make Any Money?"},"content":{"rendered":"

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So the headline is incredibly impressive. \u00a0AI Support \/ Agent leader Moveworks at $100m+ ARR sells to ServiceNow for $2.85 Billion, a 20x-25x ARR exit and a huge, huge price in absolute terms.<\/p>\n

It\u2019s ServiceNow\u2019s largest acquisition \u2026 ever.<\/p>\n

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A huge exit. \u00a0But do the investors actually make any money here? \u00a0And should you care?<\/p>\n

The answers are murky. \u00a0Why? \u00a0Moveworks raised $200m of its $315m in VC Capital in 2021 \u2026 at a $2.1 Billion valuation<\/p>\n

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Add in dilution since 2021, carve-outs on the deal, etc. it\u2019s most likely the last round investors just made their money back. \u00a0A 0% gain.<\/p>\n

$200m of the $300m+ raised came in the last round, so likely, 66% of the investor dollars made no return at all, no profit, on a $2.8 Billion exit.<\/h3>\n

Now everything is nuanced. \u00a0Tiger Global and another late stage investor put up most of that $200m by leading the last round, although existing earlier stage investors also contributed. \u00a0But the earlier investors all will make money on the deal, some a lot of money. \u00a0So most VCs in the deal will make money. \u00a0It\u2019s just most of the money itself \u2026 won\u2019t make money.<\/p>\n

And the reality is, the last round was raised at a very high valuation in 2021. Selling for $2.8 Billion today is more than fair. \u00a0But it also shows how challenging making money at the growth stage can be.<\/p>\n

It used to be growth round investors often blocked these deals. \u00a0I don\u2019t see that as often today, as long as they get their money back.<\/h3>\n

Especially when the company\u2019s chances for an IPO or another big round have dimmed. \u00a0The growth investors then are often fine (not happy, but fine) getting their money back when it seems most likely there are no big gains to come. \u00a0The last round investors in Loom\u2019s ~$1B sale to Atlassian also made no money, as the last round was at a $1.2B valuation.<\/p>\n

Still, somewhat a crazy world where you can see your B2B AI company for $2.8 Billion \u2026 and most investors don\u2019t make a dime.<\/p>\n

Maybe you think that\u2019s the way the cookie crumbles. \u00a0And so it does. \u00a0Who cares about the investors anyway?<\/strong> \u00a0But put your investor hat on. \u00a0Would you want to invest and take a huge amount of not just financial but career risk for the individual investor \u2026 and 4 years later just get your money back with a 0% gain? \u00a0It\u2019s tough. \u00a0I don\u2019t know.<\/p>\n