SaaS Business Broker to Sell Your Software Company

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SaaS Transactions are Different

SaaS companies operate in a highly technical product environment and have business terms different from most other industries.

SaaS Products are Technical

Your advisor should understand the technical product details and be capable of discussing hosting infrastructure, tech stacks, DevOps infrastructure, front-end, back-end, and all the components in between with interested buyers. These details are essential to the buyers of SaaS companies, and your advisor needs to be able to confidently and accurately have these conversations with prospective buyers.

SaaS Business Terms are Different

Unlike perpetual license sales, a vital aspect of a SaaS company is the recurring revenue. Properly presenting this subscription-based revenue and understanding terms like ARPU, CAC, LTV, Churn are necessary for assisting the buyers in understanding the company’s business side correctly and accurately modeling cash flow. Only through an accurate cash flow model can you achieve a high offer that will survive due diligence.

SaaS Industry Experience

Earlier in my career, I worked for highly successful companies like OracleSiebel SystemsBMC/Remedy, and Suse Linux. With over 20 years of industry experience, I’ve participated in the transition from 3270 green screens through client-server architectures to today’s web-based applications. Understanding the products, technologies, and ecosystems is critical for a successful software company exit.

Business Buyers Purchase Revenue

If you’re the owner of a software company with an established base of paying customers, I will welcome the opportunity of an introductory call. We can discuss your business and your plans for the future. I’m happy to share details about my extensive database of business buyers, and the company attributes that make attractive acquisition targets.

My Services

Most business owners only go through the exit process once in their career. Business buyers purchase 2-3 companies a year. The opaque process and the seller’s high stakes typically create a stressful experience for the business seller. To assist my clients in a smooth and orderly sale, I provide a hands-on, high-touch level of service, starting with the initial consultation through final deal signatures and transfer of funds. I work with you and guide you through the entire exit process clearly and transparently.

Ideal Software Company Size

Revenues: $3m-$20m in annual license/subscription revenue. Flat or growing over the past three years.

Employees: 20-50 full-time employees, primarily based in the USA.

SaaS Valuations – Lower Middle Market

Properly valuing your SaaS company will be a crucial part of finding well-qualified buyers. SaaS companies in the lower middle market will typically sell for 1-5 times revenue.  

The important factors which determine the revenue multiple are:

  • Revenue growth
  • Revenue / employee
  • Size of the Total Addressable Market (TAM)
  • Quality and capabilities of the current management team
  • Customer Churn
  • Customer Cost of Acquisition (CAC)
  • Customer Lifetime Value (CLV) 

SaaS Valuations – Unrealistic Expectations

If you overprice your business, you’ll attract less sophisticated buyers. These buyers will take lots of your time to understand your business and will constantly be pointing out the problems in your company. When you finally start the due diligence process, the list of issues will resurface to convince you that a discount is necessary. If you finally agree to terms and a payment structure, many will struggle to assemble the financing required to complete the transaction.

SaaS Valuations – Realistic Expectations

On the other hand, if your expectations are reasonable, you’ll attract highly sophisticated buyers who have ready access to significant financial resources. These buyers will see your business problems as opportunities that can be fixed and increase the company’s value. Moreover, they will likely offer you equity in the new business. This rollover equity provides another bite at a much larger apple. In addition, by working with a prominent industry participant, you’ll have a much larger stage to demonstrate your expertise and accelerate your career. Nothing says success like being bought out by an established industry player and having them as an investor in your next business venture.

Why Choose Me as your SaaS Business Broker

• Experience and understanding of the SaaS industry

• Large network of qualified active buyers

• Proven ability to attract multiple premium offers

• Real-world experience as a business owner with a successful exit

• Straightforward, transparent, no b/s approach