The code is the obvious starting point, but what separates a great software acquisition from a risky one is a technical team that ships and maintains the product without the founder and recurring revenue that keeps coming in without being re-earned.
What to know about buying a software development business
How software development businesses are valued
Asking prices are set as a multiple of earnings: 3x–10x annual profit, depending on recurring revenue, team, and whether you own your product.
Where you land in that range depends on how much of your revenue comes from ongoing subscriptions and support versus one-off projects, and whether the business runs without you writing code or closing deals.
Revenue that comes in every month without re-selling
A product or platform you built and own
A development team that delivers without you
Revenue spread across many clients
What buyers of software development businesses look for
Technology companies looking to acquire products or development teams in your specialty
Companies in related industries who want to bring software capabilities in-house
First-time buyers with technical backgrounds looking for a profitable software business
Larger consulting firms looking to expand into new technologies or markets
The first questions buyers ask:
Delivery Margins. Are your margins real, or are you winning work by under-scoping it?
Backlog Reality. What does your backlog mean in practice: signed SOWs or “we’re pretty sure”?
IP Ownership. Who owns the code, and are you sure you’re allowed to reuse your ‘accelerators’?
Closed deals
Rejigg software development deals closed
Across 42 closed deals on Rejigg, the median time from first pitch to close is 177.5 days.
Practical guidance from hundreds of real acquisition conversations.
Recurring versus Project Revenue
Ask for a revenue breakdown by type and look at what percentage of last year's income came from customers who were already on recurring agreements.
Subscriptions, support contracts, and managed services that renew without re-selling are worth significantly more than project work.
The split between recurring and project revenue is the single most important number to understand in any software acquisition.
IP Ownership and Code Rights
Ask for a summary of all client agreements and their IP provisions.
In custom software firms, IP ownership can be complicated — some client contracts give the client ownership of code built for them, which can limit what you're actually acquiring.
The most valuable software acquisitions are ones where the company owns a platform or product that generates licensing or subscription revenue under the company's own brand.
Engineering Team Independence
Ask who manages the development roadmap today, whether the lead engineer could step into the principal technical role, and what the team's average tenure looks like.
A development team that ships work, manages client relationships, and maintains the product without the founder reviewing every line is a very different acquisition than one where the founder is the only technical decision-maker.
Meet the lead engineer early in diligence and get a read on their interest in staying post-close.
Customer Diversification
Ask for a revenue breakdown by client and look at the average tenure of the top 10 accounts.
Software companies that rely on one or two large clients for most of their income carry real concentration risk that should be reflected in the price and deal structure.
When no single client makes up more than 15 to 20 percent of revenue, the business is much more stable.
Technology Stack and Documentation
Ask for a plain-English overview of the tech stack, where the software is hosted, and how it's deployed and maintained.
A codebase that's well-maintained, documented, and built on current technologies is easier to operate and improve than one running on deprecated frameworks with no documentation.
You don't need to be a developer to assess this — asking the right questions reveals a lot about how carefully the business was run.
Valuation
What Should You Expect to Pay?
3x-5x
SDE
Owner-operated with mixed recurring and project revenue
5x-10x
EBITDA
With management team, proprietary product, and majority recurring revenue
Businesses with a proprietary product generating subscription revenue and a technical team that operates independently consistently reach the high end of the range, while custom development shops without recurring revenue tend toward the lower end.
What drives a premium
Proprietary software platform generating subscription or licensing revenue under company ownership
60%+ of revenue from recurring subscriptions, support contracts, or managed services
Lead engineer or technical director with 5+ years of tenure managing delivery independently
Revenue spread across 10+ clients with no single account above 20% of total
Thinking About Selling?Read our owner's guide to selling a software development business, with valuation tips, buyer expectations, and step-by-step advice.
How do I contact the owner of a business I found on Rejigg?
Create a free Rejigg account; owners, and the brokers who run some sales, only hear from buyers through the platform. Open the listing to see the full profile: city, team size, financials, what is for sale, and the reason for selling. Sign Rejigg's standard Fee & Confidentiality Agreement for that business; it is the same form for every deal. Verify your phone, then send your pitch from the listing. Replies, meetings, and documents all run through Rejigg.
Can I email Rejigg to get introduced to an owner?
No. Rejigg does not forward emails to owners or brokers, so a note to support@ or hello@ with a listing link will not reach them. Create a free account, open the listing, sign the agreement for that business, verify your phone, and send your pitch; that reaches them in a few minutes.
Are your margins real, or are you winning work by under-scoping it?
Buyers are trying to confirm that profit comes from solid estimating and scope control, not late nights that disappear after a handoff. They test what happens to margin when scope changes, client reviews drag, or a senior engineer leaves mid-project. If you can’t explain sold hours versus delivered hours and how you price changes, they usually assume margin will compress and protect themselves in the terms.
What does your backlog mean in practice: signed SOWs or “we’re pretty sure”?
In software services, “backlog” can mean anything from signed statements of work to friendly promises for the next sprint. Buyers want to underwrite near-term revenue and staffing without assuming the founder has to re-sell every month to keep payroll covered. They also look for pause and cancellation language that can turn a “booked” quarter into a slow quarter fast.
Who owns the code, and are you sure you’re allowed to reuse your ‘accelerators’?
Unclear IP can kill a software development deal because it affects whether the buyer can legally operate, support, and extend the work you’ve shipped. Buyers look for signed IP assignment documents for employees and contractors, plus clarity on what clients own versus what you reuse across projects. They also want to understand any open-source components that could create license obligations that don’t fit a commercial services business.
How dependent are you on specific engineers, and what happens if they quit?
A dev shop’s value lives in the team, so buyers focus on knowledge concentration and coverage by role. They want to know if one person owns deploys, holds the hardest parts of the codebase, or is the trusted voice with a key client. They also look for situations where margins depend on underpaid senior talent who can reset comp or leave after close.
What would break if you stopped doing sales, solutioning, or architecture tomorrow?
Buyers are looking for single points of failure. In dev businesses, founders often carry three tough jobs: closing deals, scoping and estimating, and being the final technical decision-maker when a project gets tense. When those roles sit with one person, buyers usually ask for a longer transition, tie part of the price to retention, or both.
What part of revenue is maintenance, and what part is ‘new build disguised as support’?
Buyers want to see which revenue survives budget cuts and leadership changes. They dig into what’s included in retainers, how often they renew, and whether “support” is really a monthly stream of new scope with no change order. This matters because predictable maintenance is easier to staff and finance than a retainer that quietly depends on senior heroics.