Sub-$500k software deals are not a market with a stock exchange. They are a market with a hundred small doors, and the difference between buyers who close good deals and buyers who close bad ones is almost entirely which door they were standing at when the seller decided to sell.
The five routes
| Route | Cost to you | Deals you see |
|---|---|---|
| Open marketplace | none | every listing, all buyers |
| Broker's buyer list | none | vetted, all buyers |
| Curated deal list | none | few, early |
| Direct to founder | none | one at a time |
| Search fund / advisor | 2% retainer | sourced for you |
Sellers pay the fee on a marketplace or broker sale — commonly 10% to 15% of the close on a business this size — and that fee is inside the price you pay. "None" means no invoice with your name on it, not that no money changed hands.
Marketplaces are where you learn the market and where you find the least advantaged deal, because five hundred other people opened the same email. Broker lists are the same with better paperwork. Direct outreach works and almost nobody does it, because it means writing to two hundred founders to buy one business.
Why the good deals are gone before they are listed
A bootstrapped founder does not wake up one morning and list. They spend three to nine months deciding, and during that window they are looking for one thing: what is this actually worth. That is the moment a buyer wants to be visible — not on the day the listing goes live, by which point the price has been set by someone paid a percentage of it.
What a fair asking price looks like at this size
Businesses under $1M ARR are bought on owner earnings, not revenue. Our baseline multiple by size, anchored on Flippa, 20 Feb 2026 and FE International, 21 Jan 2026:
| Monthly revenue | Baseline owner-earnings multiple |
|---|---|
| $1,000–$5,000 MRR | 2.4x |
| $5,000–$10,000 MRR | 2.8x |
| $10,000–$25,000 MRR | 3.2x |
| $25,000–$50,000 MRR | 3.6x |
| Above $50,000 MRR | 3.6x |
Before any adjustment for churn, growth, customer concentration or age.
Take a real-shaped listing: $8,000 MRR, 1.4% monthly growth, 4.1% monthly churn, 31% of revenue in one customer, 34 months old. Our engine puts it at $120,000–$143,500 — 1.9x owner earnings of $70,080, or 1.4x revenue.
What to do with the first ten deals you see
- 01Price it yourself before you read the asking price. Anchoring is real and it is expensive.
- 02Ask for revenue by customer, twelve months. Concentration is the flag that most often kills a deal after the LOI.
- 03Ask for monthly churn as a revenue figure, not a logo figure. Logo churn flatters a business with one big account.
- 04Separate owner pay from operating cost. What you are buying is what is left after the software runs itself.
- 05Walk away out loud. At this size there is always another listing next month, and the seller knows it.
None of that requires a fund, an advisor or a data room. It requires the numbers, and a seller willing to send them — which, at this size, most are.