Sell your SaaS business.

There are three primary ways that a software as a service (SaaS) business is valued: a multiple of seller's discretionary earnings (SDE), a multiple of earnings before interest, taxes, depreciation, and amortization (EBITDA), or a multiple of revenue. The method used will depend on the business's size, complexity, and maturity.

A seller might use an SDE multiple if their SaaS business is smaller and owner-operated, especially if the owner is closely involved with day-to-day operations. SDE is a measure of the total financial benefit of the business to the owner.

EBITDA multiples are more commonly used to value larger SaaS businesses that are more established and have management structures and operational processes that are less reliant on the owner. EBITDA may provide a more consistent measure for comparing businesses with different ownership and finance arrangements.

If revenue and growth are more significant indicators of value to a SaaS business than current earnings (for example, if the business is growing rapidly but has relatively low profit because it is being reinvested in growth), a seller could use a revenue multiple to guide their valuation.

Once a seller has decided on the most appropriate metric against which to value their SaaS business, they apply a multiple to that figure. Flippa suggests that the multiple will, on average, be somewhere between two and six. For example, if a SaaS business generates $200,000 in annual SDE and is valued at 3× SDE, it would have an indicative valuation of $600,000.

How much a software as a service (SaaS) business sells for depends on its size, profitability, growth, market demand, and the method used to value it. Flippa's 2026 guidance states that smaller SaaS businesses typically sell for around 2.5 to 4.5× their profit. Mid-sized SaaS businesses may sell for 3.5 to 6× their earnings before interest, taxes, depreciation, and amortization (EBITDA), while high-growth SaaS businesses may be valued at 2 to 3.5× annual recurring revenue (ARR).

The valuation of a SaaS business does not always mean it will sell for that amount. Factors like business size, industry category, growth, and customer retention can all influence how much a buyer is prepared to pay. The reliability of recurring revenue, customer churn, profit margins, and the level of dependence on the owner can also affect the multiple a buyer might offer.

Recent sales of comparable businesses can help a seller of a SaaS business calculate a realistic valuation range. Flippa's closed deals page provides examples of SaaS businesses that have sold on the platform, including their reported revenue, profit metrics, and sale prices where available. Comparing businesses with similar financial performance and operations can be a more useful indication of potential value than a single industry-wide multiple.

In 2026, software as a service (SaaS) valuation multiples range from around 2.5× to 6×, depending on the valuation method used. Flippa’s 2026 guidance says that smaller SaaS businesses typically sell for around 2.5 to 4.5× their Seller's Discretionary Earnings (SDE), mid-sized SaaS businesses sell for 3.5 to 6× their earnings before interest, taxes, depreciation, and amortization (EBITDA), and high-growth SaaS businesses are often valued at 2 to 3.5× annual recurring revenue (ARR).

The metric used to determine the valuation multiple of a SaaS in 2026 depends on how the business generates and sustains its earnings. SDE is often used by smaller, owner-operated businesses. EBITDA tends to be more suitable for established SaaS businesses with teams and systems in place that are not heavily dependent on owner involvement. Revenue or an ARR multiple may be appropriate for businesses that are reinvesting in expansion.

Factors that may influence the valuation multiple of a SaaS in 2026 include the size and complexity of the business, its dependence on the owner's knowledge and input, customer retention and churn, revenue growth, profit margin, and expenses. Flippa reports that in the first half of 2026, the average profit multiple that SaaS businesses sold for was 2.56.

A seller of a SaaS business can combine their financial data with analysis of recent sales of comparable businesses to inform their own valuation multiple. Completed transactions may be more informative than asking prices.

Yes, a software as a service (SaaS) business can still be sold if it has high customer churn. However, high churn can affect buyer sentiment and may put downward pressure on the business's valuation.

Churn measures the rate at which customers cancel or stop paying for a SaaS product. A buyer looking at a SaaS business with a high churn rate will analyze why customers are leaving, whether the churn is increasing or decreasing, and how easily—and at what cost—those customers can be replaced. Metrics like net revenue retention (NRR), customer lifetime value (LTV), customer acquisition cost (CAC), revenue growth, and profit margins can also be useful.

Flippa reports that a high churn rate can directly affect the multiple that a seller can ask for when selling their SaaS business. The average churn rate for SaaS businesses sold on Flippa in 2026 is 5.43%. This does not mean a SaaS business with a higher churn will not sell, but a higher churn rate may affect the multiple that buyers are prepared to offer.

If a seller of a SaaS business reduces their churn rate, they may be able to ask for a higher multiple in their valuation. Flippa suggests that improved onboarding workflows, offering sticky features that promote regular use, and introducing annual plans can all help reduce customer churn.

Protecting intellectual property (IP) and customer data during due diligence of a software as a service (SaaS) business for sale can involve controlling access, only sharing sensitive information at appropriate stages of the process, and using a non-disclosure agreement (NDA).

Using an NDA during the due diligence of a SaaS business for sale means that buyers have a legally binding obligation to keep certain information confidential. The NDA can also state how the buyer is allowed to disclose the information to other parties. Flippa provides the use of an NDA as an option in all of its sales packages.

Staged access to sensitive information during due diligence of a SaaS business can mean buyers have sufficient information to decide if they would like to see more. Sellers can provide high-level information during the initial stages and more detail further through the process. For example, customer lists and other personally identifiable information should not necessarily be shared in full during the early stages of due diligence. They can be made anonymous during initial discussions, along with the information a buyer needs to assess customer concentration, retention, and revenue quality.

While a seller of a SaaS business can protect IP and customer data, they must be able to demonstrate clear ownership of the code, trademarks, and other IP to a buyer. They should also control how technical information is accessed during due diligence. A seller can offer read-only analytics and supervised code walkthroughs rather than unrestricted access.

End-to-end, a software as a service (SaaS) exit can take anywhere from approximately 30 days to several months or more. The exit process covers preparing the business for sale, finding and negotiating with buyers, completing due diligence, and transferring the business upon final transaction.

Factors that can affect the exit time include the business's size and complexity, preparations for sale, and sales method. Flippa states that most well-positioned SaaS businesses that are listed on marketplaces and have accurate documentation and a realistic valuation can expect to close within 60 to 90 days. Smaller SaaS businesses tend to sell more quickly than large ones, while self-service sales often take longer than those arranged by a broker (although brokered deals may attract higher-quality buyers).

The preparation to sell a SaaS business can affect the overall exit time. Clear financial information, well-organized operations, reduced owner dependence, and up-to-date documentation on operations can help to speed up the sale process and allow buyers to more easily conduct due diligence.

The timeline for an exit can vary considerably between SaaS businesses. Market conditions at the time of the sale, buyer outreach and negotiations, due diligence, drafting legal agreements, and effecting the final handover may all influence the time between listing and close.

The main difference between Flippa and a technology mergers and acquisitions (M&A) firm is that Flippa is an online marketplace for selling online businesses of all sizes, while an M&A firm provides a more hands-on service for larger transactions. They differ in how the sale is managed, the level of support provided, and the type of business or buyer involved.

Flippa allows sellers of online businesses to create a listing on their marketplace, which has a broad pool of buyers. Sellers can connect with prospective buyers themselves and negotiate the sale of their business directly. A tech M&A firm generally provides a more bespoke service. An M&A adviser may help prepare the business for sale, identify and approach potential buyers, manage negotiations, coordinate due diligence, and advise on transaction terms. The process is often more targeted and tailored to the individual business. Flippa also offers similar services through its business brokers.

For a seller of a SaaS business, choosing between Flippa and a tech M&A firm may depend on the size of the business, the type of buyers they are targeting, the degree of legal complexity involved, and the level of support they would like to facilitate the sales process.