Sell My Software Development Agency – AI-Powered Brokerage & Valuation

Q: How long does it take to sell an agency?

Most sales complete in 3–6 months from preparation to close, depending on size, quality of earnings, buyer fit, and data‑room readiness.

Q: How much is my agency worth?

Typically a multiple of SDE/EBITDA adjusted for growth, retainer share, gross margin, utilisation, client concentration, backlog, staff risk, and contract quality.

Thinking of an exit? Get a data-driven valuation, a buyer-ready package, and a confidential process designed for software services firms.

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AI-assisted comps

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How Much Is My Software Agency Worth?

Short answer: Valuation ≈ Profit (SDE/EBITDA) × market multiple, adjusted for revenue mix (retainers vs projects), growth, client concentration, utilisation, gross margin, backlog/pipeline, staff dependency, and contract quality.

Valuation, in brief (5 steps)

Choose method: SDE multiple for owner‑operated shops; EBITDA for larger, systemised firms.
Normalise metrics: revenue by stream (retainers/projects/T&M/fixed‑bid), gross margin, utilisation, backlog, add‑backs.
Benchmark with comps: niche/tech stack, size band, onshore/offshore mix, certifications, client GEO, win rate.
Adjust for risk: client concentration, key‑person reliance, contractor model, IP & assignments, churn/tenure.
Run scenarios: base / upside / de‑risked (e.g., more retainers, higher utilisation), then set a defensible range.

Agency Valuation Multiples in 2025 (Indicative)

Ranges vary by size, quality, and buyer type. Treat these as directional bands, not guarantees.

Profile	Basis	Indicative Range*
Owner‑operated, <$500k annual profit	SDE multiple	~2.0×–3.5× SDE
$500k–$2m annual profit, steady growth	EBITDA multiple	~3.5×–5.5× EBITDA
$2m+ annual profit, strong retainers & low concentration	EBITDA multiple	~5.0×–7.5× EBITDA

*Illustrative bands only; outcomes depend on growth, retention/tenure, margins, utilisation, client mix, risk, buyer type, and market conditions.

How We Value Agencies: Mix, Margin, Utilisation, Concentration

Driver	Strong Signal	Effect on Multiple
Revenue Mix	50%+ retainers or multi‑year MSAs	Higher (recurring/visibility)
Gross Margin	≥ 45–55% services margin with rate discipline	Higher (pricing power)
Utilisation	Billable utilisation ≥ 75–80%	Higher (efficiency)
Client Concentration	No client > 15–20% of revenue	Higher (lower volatility)
Backlog & Pipeline	3–6 months coverage; CRM‑tracked win rate	Higher (durability of revenue)
People Risk	Documented SOPs, cross‑training; limited key‑person dependence	Higher (transferability)

SDE vs EBITDA for Agencies: Which One Matters?

Smaller, owner‑led agencies are commonly priced on SDE (profit + reasonable owner compensation + normalised add‑backs). Larger, systemised firms trend to EBITDA. We compute both and align to the buyer pool.

How our AI model improves the valuation

Maps your metrics to live agency comps (size, mix, margin, utilisation, concentration).
Runs sensitivity on utilisation, rate card, and retainer share to show multiple uplift.
Ranks buyer fit (strategic vs financial) to indicate likely price/structure scenarios.

Example (illustrative): SDE $850k; 18% YoY growth; 52% gross margin; 78% utilisation; top client 14%; 55% retainers → AI comps produce a defensible range and show how +5 pts utilisation or +10% retainer mix lifts the range.

What to prepare (faster valuation)

Last 24 months P&L/BS/CF; revenue by client/stream; WIP and AR ageing; backlog & pipeline.
Rate cards, utilisation reports, staffing plan; contractor vs employee mix; turnover figures.
Client/MSA/SOW contracts (assignability), SLAs, renewal history, satisfaction/NPS.
Top 20 clients with % revenue; sector/GEO mix; channel/partner dependencies.
IP & assignments: contributor agreements, OSS policy, licences, trademarks.

Quick answers:

Revenue or profit multiple? Mostly SDE/EBITDA for agencies; revenue multiples are rare and reserved for exceptional scale/specialism.

What improves my multiple fastest? More retainers, better utilisation/rates, lower client concentration, and clean IP/assignments.

Staffing model? Buyers favour stable core teams with documented SOPs and scalable contractor benches.

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How Long Does an Agency Exit Take? (Typical 3–6 Month Timeline)

Phase	Weeks	What Happens
Preparation	2–4	Normalise financials & KPIs; assemble docs; create CIM; data room setup.
Outreach & IOIs	2–4	Targeted buyer list; NDAs; teaser/CIM distribution; initial Q&A.
LOIs & Negotiation	2–3	Term negotiation (price, structure, earn‑out); select preferred LOI.
Due Diligence	4–8	Financial, legal, operational; client calls; confirmatory checks.
Closing & Handover	1–2	Legals, funds flow, IP & assignments; transition plan.

Timelines vary by deal size, data quality, and buyer type. Clean books, clear contracts, and utilisation history compress time‑to‑close.

Agency Sale Process (Step-by-Step)

Preparation: normalise financials, verify KPIs (margin/utilisation), review MSAs/SOWs, IP assignments.
Packaging: CIM/teaser, KPI deck, and secure data room.
Buyer Outreach: confidential, thesis‑based approach to qualified buyers; NDAs first.
Offers & Negotiation: manage Q&A; align on price & structure.
Due Diligence: coordinate financial, legal, and operational diligence.

IOI vs LOI: What’s the Difference?

IOI (Indication of Interest) is a non‑binding price range and high‑level terms used to shortlist buyers. LOI (Letter of Intent) sets a specific price/structure, exclusivity period, and key conditions; largely non‑binding except for exclusivity/confidentiality clauses.

Closing & Handover

Post‑LOI, definitive agreements are drafted (SPA/APA), schedules completed, working‑capital mechanics finalised (WIP/AR), funds‑flow and escrow arranged, and IP/assignments executed. A clear transition plan reduces post‑close risk.

Due‑Diligence Checklist & Data‑Room Index

Financials: last 24–36 months P&L/BS/CF; AR ageing; WIP schedules; revenue by client/stream.
KPIs: gross margin by service line, utilisation, rate cards, backlog/pipeline, win rate.
Legal: incorporation, cap table, MSAs/SOWs (assignability), NDAs, IP assignments, OSS policy, licences, trademarks.
Operations: org chart, employment/contractor agreements, SOPs, QA/process, tooling stack.
Commercial: top clients, renewal history, NPS/case studies, partner/channel agreements.
Risk: dependency mapping (clients, staff, vendors), insurance, disputes/claims log.

Deal Structures & Terms

Element	What it is	Pros	Considerations
Asset vs Share	What the buyer purchases	Asset: cleaner; Share: continuity	Tax impact; liabilities; contract assignment
Earn‑out	Deferred, performance‑linked	Bridges valuation gaps	Metrics (revenue, margin, retention); control; reporting
Seller Note	Vendor financing	Faster close, better price	Interest, security, covenant terms
Escrow/Holdback	Funds reserved post‑close	Protects against surprises	Duration, claims process

Working Capital & WIP/AR Adjustments

Expect a normalised working‑capital target at close. For agencies, WIP, AR ageing, unbilled time, and prepaid retainers require clear treatment to avoid double‑counting or cash gaps. Define mechanics in the LOI.

Taxes & Legal Basics

Jurisdictions: tax outcomes differ (US/UK/EU). Obtain specialist advice early.
IP & Assignments: ensure chain‑of‑title, employee/contractor IP assignments, client contract assignability.
Data & Security: policies, controls, and certifications appropriate to client sectors.
Non‑compete/Non‑solicit: scope, duration, and geography for both staff and clients.

This is not tax or legal advice. Engage qualified advisers in your jurisdiction.

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Who Buys Agencies?

Strategic Buyers: larger dev/consulting firms seeking capacity, capabilities, or GEO expansion; often pay for synergies.
Financial Buyers (PE/Roll‑ups): disciplined underwriting, platform + add‑ons, structured deals.
Entrepreneurial Operators/Search Funds: operators aiming to scale with processes, productisation, and sales engines.

Broker Fees vs DIY

Path	Typical Cost	What You Get	When It Fits
Brokered	Commission (tiered) + minimal upfront	Packaging, buyer network, negotiation, DD coordination, contract mapping	Limited time, larger buyer pool, price protection
DIY	Low fees; high time cost	You run outreach, Q&A, negotiation, legals	Very small deals; known buyer already sourced

Best Time to Sell a Software Agency

Sell into momentum: clean books, durable growth, rising retainer share, strong utilisation/margins, healthy backlog, and low client concentration. If soft, a 3–6 month tune‑up (retainers, rates, utilisation, SOPs) can lift multiples.

Online Business Brokerage Services

Agency Sale Brokerage & Exit Advisory

We guide software services founders from preparation and positioning to targeted buyer outreach and closing. Commission‑based; aligned with your outcome.

Agency Valuation & Exit Planning

Get an AI‑powered, confidential valuation in 24 hours and a focused plan to lift multiples (retainers, rate card, utilisation, contracts).

Buy‑Side Advisory & Acquisition Search

For investors/acquirers: retained search, thesis‑matched pipeline, modelling and diligence to reduce risk and speed to close.

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Case Studies (Anonymised)

Profile	Size	Outcome	Structure	Time to LOI
Agency – fintech custom dev	$1.1m EBITDA	~6.1× EBITDA range	Cash + 18‑mo earn‑out	6 weeks
Agency – e‑commerce builds	$650k SDE	~3.4× SDE range	Cash + seller note	7 weeks
Agency – data/AI services	$2.4m EBITDA	~7.0× EBITDA range	Share purchase	8 weeks

Illustrative examples; actual outcomes depend on metrics, risk, structure and market conditions.

About Our AI‑Native Brokerage

We specialise in online services M&A with AI‑assisted valuation models, buyer matching, and data‑room standards that speed diligence and protect price. Work is confidential, document‑first, and founder‑friendly.

Partnership Programme

Advisers, accountants, and operators can refer founders ready to exit. Earn partner fees while we deliver valuation, packaging, and deal execution.

Learn more about partnerships

FAQs – Selling a Software Development Agency

How long does it take to sell an agency?

Most sales complete in 3–6 months from preparation to close, depending on size, quality of earnings, buyer fit, and data‑room readiness. See the sale process.

How much is my agency worth?

Typically a multiple of SDE/EBITDA, adjusted for growth, retainer share, gross margin, utilisation, client concentration, backlog, staff risk, and contract quality. We produce a defensible range using AI‑assisted comps and sensitivities.

How do you value an agency (methodology)?

AI‑assisted market comps plus drivers (retainer %, margin, utilisation, concentration, backlog/pipeline, rate card discipline) to produce a range with sensitivities. Details in How Valuation Works.

What documents do I need for due diligence?

Clean financials; revenue by client/stream; AR/WIP schedules; rate cards and utilisation; MSAs/SOWs; IP assignments; org chart and contracts; SOPs; case studies/NPS. See the checklist.

How are revenue and margins verified?

Via accounting exports, bank statements, AR/WIP reconciliation, project P&L sampling, and contract tie‑outs to confirm rates, scope, and timing.

Do I need audited financials?

Not always. Accurate, verifiable books with consistent KPI reporting are usually sufficient for SMB/mid‑market; larger deals may request reviews or audits.

What are typical business broker fees?

Success‑based commission (sliding by deal size) is standard. Some brokers charge optional upfront fees for valuation/exit‑readiness deliverables that reduce time‑to‑close.

How do you keep the sale confidential?

NDA‑gated data rooms, anonymised teasers, and targeted outreach to vetted buyers only. Identity and sensitive client data are disclosed in stages.

What deal structures are common?

Cash at close plus earn‑out or deferred elements tied to revenue/margin/retention is common; structure depends on risk, growth, and buyer type.

Asset sale vs share sale — what’s the difference?

Asset sales transfer selected assets and liabilities; share sales transfer the company as a whole. Outcomes vary by tax, liability, and continuity. Seek professional advice.

How is IP handled?

Employee/contractor IP assignments, client IP in SOWs, OSS policy compliance, and licence inventories. Clean chain‑of‑title de‑risks diligence and lifts multiples.

What support am I expected to provide after closing?

Typically a short transition and knowledge transfer period (weeks to months) defined in the APA/SPA; extended advisory is negotiable if required.

How can I increase my valuation before going to market?

Increase retainer share, improve utilisation and rates, reduce client concentration, document SOPs, and clean IP/assignments. These usually move the multiple fastest. See value maximisation.

Should I fix issues first or sell as‑is?

Fix high‑ROI items (contract gaps, AR/WIP hygiene, rate discipline, key‑person risk) before launch; large restructures rarely pay back pre‑sale. We’ll model the impact either way.