Selling a startup to a US corporation for under €100 million is the outcome many founders actually reach. It is neither a fire sale nor a unicorn payday. It is a real transaction that pays founders, secures a future for the product, and changes the company in ways that investors, employees, and customers must live with.
Smaller strategic acquisitions are strategic for US corporates. They buy teams, distribution, tech and a foothold in a market without building from scratch. Valuation math is pragmatic in this band. Revenue multiples for SaaS and software targets in recent private M&A data cluster in the mid single digits on revenue when growth and retention are moderate. Premiums appear for high retention, predictable subscription revenue or differentiated IP. That valuation reality frames every negotiation, as buyers weigh the price against the costs of integration and the potential future upside.
This dossier walks through the sequence, the money, the legal traps and the practical choices that separate a clean exit from lasting regret.
How a realistic sales process actually runs
Most exits follow a familiar arc, whether they involve competitive auctions or single-buyer trades. Sellers prepare a data room, create a one-page teaser, and then engage a select group of buyers. The sell-side process progresses from early outreach to a shortlist, then to exclusivity talks, and finally to closing. Timelines vary, but the practical path is often measured in weeks for diligence and in months to reach signed agreements and cash at close. The disciplined processes remove doubt and give buyers confidence.
Money mechanics that founders need to internalise
Purchase consideration typically splits into an upfront cash tranche, a holdback escrow, and, in some cases, an earn-out. Escrows protect buyers against breaches of warranty and representations, and the typical holdback percentages compress for insured deals. When buyers buy warranty insurance, the indemnity escrow required is often lower because the policy covers many post-close claims. Where insurance is not used, escrow percentages can be materially higher. Sellers should expect the cash at close to be meaningfully less than the headline price until escrow is released and any earn-out performance is achieved.
Earnouts and the alignment problem
Earnouts provide buyers with comfort and allow sellers to claim future upside when performance is uncertain. The structure is simple to describe and hard to live with. If the earnout measures revenue or ARR, you must read the definition three times. What revenues are included, which customers count, and what happens when the integration team changes pricing are all common disputes. Studies show that earnouts occur in a meaningful share of mid-market deals. That prevalence means founders must treat earnout provisions as central negotiation items, not as afterthoughts.
Due diligence that breaks promises if you are unprepared
Diligence is where clean stories become messy ones. Buyers will pull apart contracts, employee equity plans, customer agreements, supplier commitments, and tax positions. In cross-border deals, the tax review can add weeks and create post-close obligations. If software relies on third-party licences or open source components that were improperly tracked, remediation can be expensive. The practical defence is a surgical data room and full pre-sale housekeeping. Address the minor legal and accounting issues before going to market, and you will save time and margin during the process. The buyer will pay for certainty and not for surprises.
Insurance, indemnities and who really bears risk
Representations and warranties insurance has become a standard risk transfer tool in many transactions. Where the policy is used, it often short-circuits prolonged indemnity fights because insurers cover breaches within policy terms. Insurance pricing has decreased in recent years, usually replacing long-tail seller liability. Sellers who can secure an RWI policy frequently reduce the size of the escrow and expedite the closing process. Still, insurance has limits. Policies exclude known issues and some regulatory exposures. Sellers should work with experienced counsel and brokers early on so that insurance can be factored into the deal plan, rather than being discovered at the 11th hour.
Cross-border tax and structural choices that change net proceeds
How the deal is structured matters more than people expect. An asset sale and a share sale are distinct entities for tax purposes and employee treatment. For many European founders, the post-sale net is determined by capital gains treatment, withholding, and local tax reliefs. Buyers prefer share purchases to keep contracts and third-party consents simpler, while sellers sometimes prefer asset deals to ring fence liabilities. Both sides must model the net of taxes, fees and escrows early so founders do not get a surprise about what they will actually take home. Sound tax advice is inexpensive compared to an unpleasant after-tax reality.
People and retention after the click
Talent retention often determines whether technology survives the integration and whether earnouts are payable. Buyers routinely request retention packages, founder employment agreements, and restricted stock rollovers. That means founders should think in advance about the roles they will realistically play post-close and negotiate clarity on termination and change of control provisions. The most fragile moment for a seller is the first three months after closing, when cultural friction and differing incentives can cause the team to fracture—plan compensation and reporting lines with the buyer well in advance before signing.
Integration and the slow unravel of value
Integration planning separates pragmatic acquirers from deal accountants. A savvy buyer will arrive with an integration playbook that outlines timelines for ERP and payments, product roadmaps, and a go-to-market strategy for consolidation. However, even with a guide, the process can divert attention from the product. Founders should insist on measured transitions that protect customer service and product continuity while the buyer’s teams learn the business. It is better to have slow technical integration and fast alignment on customer-facing promises than the reverse.
What typically drives post-close disputes and how to avoid them
Most post-close disputes arise from a narrow set of issues. First, disagreements over earnout calculations occur when the measurement definitions are ambiguous. Second, breaches of reps that the buyer uncovers after close, often tied to tax, IP or contract disclosures. Third, cultural fit that undermines growth assumptions used to price the deal. To prevent these outcomes, sellers must negotiate precise definitions, secure RWI where appropriate, and develop retention plans that retain critical personnel through earnout windows.
A checklist that founders can use the week before launch
Prepare a clean data room that mirrors the buyer’s diligence requests as modelnet proceeds under share and asset sale scenarios. Identify the top five points buyers will test during diligence and have remediation narratives prepared for each. Engage an RWI broker if you anticipate contentious representatives and prefer a smaller escrow. Draft the founder employment and retention terms and pre-test the integration assumptions with a neutral consultant. These actions speed the timeline and protect value.
The moral of a mid-market exit story
Acquisitions of less than €100 million are not a simple transfer of shares. They are negotiated transfers of relationships, promises and future expectations. The founder who wins is not necessarily the one who gets the highest headline price. It is the founder who manages uncertainty, who turns fuzzy deal terms into clear definitions and who protects the business during the fragile post-close months. Buyers will pay for certainty, speed and a path to continued growth. If you deliver those things, you will achieve a clean exit that allows the company to survive, and the founders can keep their hard-earned upside.
Conclusion
For anyone closing a sub-€100 million acquisition, a short reading list will repay the time. Recent SaaS M&A reports give reliable valuation benchmarks. Sell-side briefs from transaction advisers show the practical steps and timelines that matter in real deals. Materials from warranty and indemnity insurers, as well as transaction studies, explain how escrows, RWI, and insurance affect negotiation dynamics and post-close risk allocation. Empirical papers on earnouts and dispute patterns reveal the clauses that most often cause headaches. Practical guides from SRS Acquiom, Aventis Advisors, and Wall Street Prep provide templates and real-world checklists that you can follow. Taken together, these sources explain the levers that determine whether a deal valued at less than € 100 million actually closes.