News broke this morning that UserTesting, a former startup that went public last year, is selling to private equity (Thoma Bravo, Sunstone Partners) for $1.3 billion, or $7.50 per share in cash. The deal, which is expected to close in the first half of 2023, includes a “go-shop” period in case a better deal shows up.

Holders of UserTesting shares have reason to rejoice. The customer insight platform sells for what? it describes as a “premium of about 94% left” [its] closing price” yesterday. As a result, UserTesting shares rose today as investors digested the news.

User Testing This morning income dropped coupled with the deal news, giving us a peek into its health. We can compare those numbers to the final price UserTesting will charge on sale to improve our understanding of the value of smaller tech companies — at least when compared to the giants in their industry.

The lessons of that are pretty simple and not great for still-private unicorns.

Looking at the deal, it’s clear that single-digit SaaS multiples are not only real, but also sustainable. UserTesting comes out with a premium of almost 100% for a fraction of the price at which it went public last year. Unless the company is a financial mess, that’s terrifying for unicorns who raised money last year.