A vertical SaaS platform ran the payments for a niche, yet was valued on subscription revenue alone. We repositioned it as a payments business to reach the right buyers, and kept several credible bidders warm into exclusivity. That live competitive threat gave us the leverage to keep negotiating after the headline terms were agreed: reworking the cash and debt definitions in the SPA and shifting proceeds out of a seller's note to move 19% more of the consideration to cash at close.
The product ran the operations. But two-thirds of revenue came from payments. A pure-SaaS lens capped the story at the software market alone and resulted in a valuation well below what the company was actually worth.
Worse, incumbent processors had slipped opaque junk fees into the flow. Customers saw inflated take-rates, blamed the platform, and churned. The best monetization lever had also become retention risk.
We reframed the asset as a payments business with a sticky software moat and took it to buyers who underwrite payments economics, not just ARR. New ARR and commission were tied directly to two growth initiatives.
We modeled the payfac snowball off a 90%+ volume-attach rate, and turned the junk-fee problem into the thesis: a processor switch would lift retention and unlock untapped revenue at once.
Leverage in exclusivity comes from outside it. We kept other credible buyers warm rather than letting the field go cold, so the threat of a switch stayed real. That optionality is what let us rework the seller's note and the working-capital definitions in the SPA, moving 19% more of the consideration to cash at close after the deal was struck.
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