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#019 CGES Index is Live Now !

Thu, 22 Apr 2021 14:44:07 GMT

CSVP Fund’s Cornerstone Global Enterprise SaaS (CGES) Index is live now !

The CGES Index has outperformed the NASDAQ by 25% yoy as of 31st March 2021 !

Read our official press release in Economic Times.

What is CGES Index ?

Cornerstone Venture Partners Fund has taken a leading initiative to create India’s first Enterprise SaaS only index namely, the Cornerstone Global Enterprise SaaS (CGES) Index - a financial index of Top 30 emerging Enterprise SaaS companies listed on global stock exchanges. The index constituents have been carefully chosen to ensure balanced sectoral and market cap representation

How is CGES different from NASDAQ and other indices ?

Traditional indices like Nasdaq Composite, S&P500 and DJIA are primarily built on the basis of market capitalization of the constituents while giving little emphasis on sectoral representation. These indices are heavy-weighed in the favor of traditional businesses like manufacturing, consumer products and technology services.

CGES Index is a one-of-its-kind index that is specifically designed to track the performance of the new breed of highly scalable companies that operate on the SaaS or SaaS-based business model. Even within SaaS, CGES Index is squarely focused only on the pure-play Enterprise (B2B) SaaS companies and does not include Consumer (B2C) SaaS companies like Netflix, Dropbox, etc.

Additionally, CGES Index companies are not selected basis the market capitalization, but rather selected keeping in mind the diversity of the size, sector, technology and scale of these companies. The CGES Index is built to equitably represent the universe of global emerging enterprise SaaS companies operating across various sectors, technologies and scale of operations.

What is the significance of CGES ?

CGES is a new-age index built on the basis of a specific ‘business model’ of SaaS, rather than the ‘size’ or ‘sector’ of the companies. It is intended to provide a benchmark for investors across the globe looking to invest in enterprise SaaS companies.

Since SaaS companies have a unique business model which is very different from traditional asset-heavy businesses like manufacturing or people-heavy businesses like technology services, it demands its own metrics and benchmarks to accurately understand the economics and valuation of such businesses.

The CGES Index will be accompanied with a set of SaaS metrics that can be used by anyone to analyze & benchmark the performance of any enterprise SaaS company.

What is the historical performance of CGES compared to NASDAQ, S&P500 and DJIA ?

The base date of the CGES Index is set at 01 January 2019 with a base value of 1,000. The closing value of CGES Index on date of publishing this (21 Apr 2021) was 3165.62, which translates into an annualized return upwards of 60% !

The corresponding returns of NASDAQ Composite, S&P 500 and DJIA for the same period are ~37%, ~24% and ~18%. All in all, the CGES Index has outperformed all the major global indices by a margin, and continues to outperform in 2021 as well.

We believe the Indian SaaS ecosystem is on the cusp of an explosive growth propelled by wide-scale adoption of SaaS products by Indian customers. As part of our leading initiative to support this ecosystem, we created the CGES Index. This Index will enable Investors to learn and better understand the SaaS economics, benchmark against the top performing SaaS companies in the world and make informed decisions.

We will share more details about the Index constituents and their selection in a series of our forthcoming blogs !

Learn more about: CSVP Fund | CGES Index | Enterprise SaaS

~ Vatsal Bavishi

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