A SaaS acquisition is the most complex transaction on a digital marketplace, because you are not buying a file or a licence — you are buying a running business with customers, recurring billing, infrastructure, and legal obligations to people you have never met. The diligence is correspondingly different.
What Actually Transfers, and What Does Not
Transfers cleanly: source code, the domain, documentation, analytics history, and the customer database as data.
Transfers with effort: hosting, third-party integrations, and email infrastructure — each needs reprovisioning under your accounts.
Usually does not transfer: the payment processor. Stripe and PayPal accounts are tied to a legal entity and its verified identity. This is the single most underestimated part of a SaaS purchase, because it means every active subscription must be migrated to your own processor, and that typically requires customers to re-enter payment details. Expect churn at that moment, and price it in.
Never transfers: the seller's personal reputation, their audience, and any revenue that depended on either.
Verifying Revenue
Get processor data directly, not a dashboard screenshot. Stripe and Paddle export transaction-level CSVs. Ask for twelve months. A summary screenshot proves nothing.
Separate recurring from one-off. A business with $8,000 monthly revenue that is 70% one-time sales is not an $8,000 MRR business, and the multiple differs enormously.
Check refund and chargeback rates. High refunds hidden behind gross revenue is the commonest form of inflation.
Look at churn honestly. Monthly churn above 5–7% for a small B2B product means the business is refilling a leaking bucket, and growth stops the moment marketing stops.
Check revenue concentration. One customer above 30% of revenue is a contract, not a business. Above 50%, you are buying a relationship that may not survive the handover.
Verifying Users
Registered users is a vanity number. Ask for monthly active users and how "active" is defined.
Watch for a sudden jump in signups — bulk-created accounts before a sale are a real pattern. Compare signup dates against traffic data; users arriving without corresponding traffic did not arrive organically.
The Costs Sellers Omit
Ask for the full monthly operating cost, itemised: hosting, database, storage, CDN, third-party APIs, transactional email, error monitoring, and any paid services in the stack.
A product showing $5,000 MRR with $2,200 of infrastructure is a very different purchase from one with $400. Sellers quote revenue; buyers must ask for margin.
Legal Obligations You Inherit
If the product holds personal data, you inherit data-protection responsibilities from the moment of transfer. Confirm there is a privacy policy, that it reflects what the software actually does, and whether users consented to a transfer of their data to a new controller.
Ask directly about outstanding disputes, chargebacks, or complaints. Ask who owns the code — if contractors wrote parts of it without an assignment agreement, the seller may not own what they are selling.
Valuation
- Growing, low churn: 3–5× annual recurring revenue
- Flat, stable: 2–3× ARR
- Declining: 1–2× ARR, if it sells
Multiples move on churn, revenue concentration, how much of the work depends on the founder, and margin after infrastructure. A product needing twenty hours a week of founder support is a job with a purchase price attached.
Using the Escrow Window
A SaaS transfer takes one to two weeks, and that is normal. On Escrozon funds are held throughout, so there is no pressure to rush:
- Get processor exports and analytics access before anything else.
- Reconcile revenue against traffic and users.
- Total the infrastructure cost.
- Run the application yourself from the source and documentation.
- Migrate one integration as a test before committing to all of them.
- Agree in writing how the payment-processor migration will be handled.
- Rotate every credential after transfer.
- Confirm receipt only when revenue, costs and code have all been verified.
If revenue is inflated or users are fabricated, the processor export and analytics are the evidence, and they are in the deal chat.
Frequently Asked Questions
Why can't the Stripe account transfer? Payment processors verify a legal entity and hold liability for chargebacks. That verification is not transferable, so a new owner needs their own account and must migrate subscriptions.
How much churn should I expect during migration? It varies, but any flow requiring customers to re-enter card details loses some. Plan for it and communicate with customers before the switch, not after.
Is a SaaS without source code worth buying? Only if you are buying the customer relationships and intend to move them elsewhere. Without code you cannot maintain, fix or extend the product.
What if the seller wants to keep the domain? Then you are buying code, not a business. The domain carries the brand, the links and the customer trust. Treat this as a fundamentally different, much cheaper transaction.
How long should diligence take? One to two weeks for a small SaaS. A seller pressing for a faster close is telling you something, and funds sitting safely in escrow means there is no cost to taking the time.
