Q: What churn rate do buyers want to see?

Sub-3% monthly churn is the inflection point — below that you anchor at the top of the band; above 5% expect the multiple to compress sharply. Buyers reverse-engineer LTV from churn, so the difference between 2% and 6% can mean a 2× swing in the multiple.

Q: Do I need audited financials to sell?

Not for sub-£1M deals — clean Stripe / Paddle exports plus 12 months of P&L are usually enough. Above £1M, expect QoE (Quality of Earnings) due diligence; we recommend tightening the books at the £500K mark to avoid friction later.

Question 1

How is a SaaS business valued?

Accepted Answer

SaaS businesses are valued as a multiple of MRR, typically 30-50× for B2B SaaS with low churn (<3% monthly), strong contracts and steady growth. B2C apps and Chrome extensions usually clear 20-32×. Annual contracts attract a 3-5× premium over monthly subscriptions.

Question 2

What churn rate do buyers want to see?

Accepted Answer

Sub-3% monthly churn is the inflection point — below that you anchor at the top of the band; above 5% expect the multiple to compress sharply. Buyers reverse-engineer LTV from churn, so the difference between 2% and 6% can mean a 2× swing in the multiple.

Question 3

Do I need audited financials to sell?

Accepted Answer

Not for sub-£1M deals — clean Stripe / Paddle exports plus 12 months of P&L are usually enough. Above £1M, expect QoE (Quality of Earnings) due diligence; we recommend tightening the books at the £500K mark to avoid friction later.

What best describes your software business?