How to sell a software development company: the 12 to 24 months before the deal

The decision to sell is usually made 12 to 24 months before the deal closes, and the price is mostly made in those months. By the time a buyer opens the data room, the drivers are set: who the clients are, how much depends on you, what the margin says, what the lawyers will find. This is what our team does in that window, in the order we do it.

Step 1. Know the range before you decide

Every founder has a number in mind, and in this market it is usually the number from a deal that made the news. The first step is the range a buyer would use today, before any decision. Buyers price the same eight drivers, in the same order: the niche and the positioning, the client concentration, the contracts and the retention, the founder's independence, the financial transparency, the margins, the delivery governance, and the risks a due diligence will find in the structure, the IP and the contracts. The company valuation self-check scores them in two minutes and puts the company into one of three ranges; a valuation call turns that into the range buyers would use today, with the comparable deals we know.

The range matters because of the gap it usually shows. Founders expect 5 to 7× EBITDA; most companies of 2 to 10 million in revenue trade at 3 to 5×, with haircuts for concentration, dependency and delivery risk. CEE EBITDA multiples recovered to 10.5× in 2024 while Ukrainian assets still trade at 3 to 4× EBIT, and that gap is what a prepared company sells into. A deal dies on an unmanaged expectation more often than on any single finding, so the number comes first. As of November 2026.

Step 2. Fix the drivers with the lowest score first

With 12 months or more, the lowest scores are worth fixing: each of them raises the multiple and makes the company easier to run in the meantime. Two of the eight have a step of their own: the risks a due diligence finds are Step 3, and the niche is Step 4, the story. The other six, in the order our team usually takes them:

1. Client concentration. One client above 40 percent of revenue is a discount however good the relationship. The work is account plans for the next five accounts and a demand engine that brings new logos, which is the go-to-market practice.
2. Contracts and retention. Multi-year or auto-renewing contracts and a tracked retention rate move money from deferred to paid at the closing. The work is the renewal calendar and the quarterly business reviews.
3. Founder independence. Sales, key accounts and delivery decisions that run for a month without you are the system a buyer pays for. The work is the account-management function and the COO layer, the people practice.
4. Financial transparency. Monthly management reporting and a two-quarter forecast have shortened due diligence by weeks in the deals our team has run. The work is the monthly close and the margin model from how we read a services P&L.
5. Margins.Gross margin by project above the floor, and a P&L that explains it. The work is project-level margin tracking and the delivery P&L review.
6. Delivery governance. A documented framework and visible project health, because a buyer audits delivery before the letter of intent.

With less than a year, the two cheapest fixes are concentration and transparency; the rest gets priced honestly in the story. A finding the buyer makes in the data room costs more than the same finding in the teaser.

Step 3. Clean the structure, the IP and the contracts

A buyer's lawyers open three things first: the corporate structure, the ownership of the intellectual property, and the client and employment contracts. In a company that grew over 10 years, each of them has history: an entity opened for one client, code written by a contractor who never signed an assignment, a master agreement with a change-of-control clause nobody remembers. Each of them renegotiates the price when it is found late. In the deals our team has run, the clean-up has taken two to four months with a law firm that does it daily; our legal partner Juscutumruns the legal side of investments and sales, and the order is the one a buyer's lawyers follow: IP first, then the entities and the tax structure, then the contracts.

Step 4. Build the story buyers repeat to their board

A buyer takes three facts to their board, and the company that gives them those three facts in the first conversation gets the second one. The facts are the niche (what the company is the best at, for whom), the proof (the clients, the retention, the margin), and the system (what runs without the founder). The story is written before the teaser, with the numbers from Step 2, and it is the same story in the teaser, the information memorandum and the management presentation. Where the founder's voice in the target market matters, a communications partner such as Calibrated builds the investor narrative and keeps the announcement under control.

Step 5. Run the process

The process itself is 6 to 9 months, and our team runs it to closing: a shortlist of buyers who fit the thesis, strategic and private-equity, warm introductions, the letters of intent, the due diligence with the operational questions prepared, the negotiation, the closing. The seller pays on success. Most sell-side teams join at this step; ours has been inside the company since Step 2, where the price was made. The buyers run the same checks from their side; the 30 operational signals they read are the list we prepare the company against.

For companies of 20 to 150 people that consider an exit within 12 to 24 months, the same path runs as the M&A Ready Acceleration Program with Lviv IT Cluster: the cluster's M&A Office audits the company the way a buyer would, our team builds the roadmap and works inside the company, and the cluster re-audits for the upgraded valuation.

The timeline, month by month

What happens after the deal

The price is paid in two parts: at the closing and over the earn-out, and the second part is where founders lose money. The role after the deal, the decision rights, the KPIs the earn-out is tied to, and the integration plan are decided before the signature or they are decided for you. Three guides cover that end of the path:

• 20 questions before signing a deal: role, decision rights, equity mechanics, integration.
• Integration readiness playbook: the nine dimensions a buyer checks before negotiations.
• Founder dependency assessment: the 12 questions a buyer asks about you, to answer first.