If you own a micro-SaaS or you are thinking about buying one, the first question is always the same: what multiple does it sell for? In 2026, small subscription software businesses generally trade at 2x to 5x annual recurring revenue (ARR), or roughly 2.5x to 4.5x seller's discretionary earnings (SDE). The wide range exists because two products with the same revenue can be worth very different amounts once growth, churn, and founder dependence are factored in.

The revenue multiple is the starting point most buyers use. A product doing $5,000 in monthly recurring revenue has $60,000 of ARR, and at a 3x multiple it is worth around $180,000. But buyers of small businesses care just as much about profit, because that is the cash they will actually take home. A product with $60,000 ARR but only $18,000 of annual profit after costs will be judged on the profit figure too, and the two answers rarely agree. When they disagree, the profit-based price usually wins the negotiation.

Growth is the strongest lever on the multiple. A product growing 5 to 10 percent a month can command a multiple a full point higher than a flat product at the same revenue, because the buyer is paying for where the business is going, not just where it is. Shrinking revenue does the opposite, and a declining product can fall below 2x ARR no matter how good the code is. Buyers will always ask for month-by-month revenue for the last 12 to 24 months, so a growth story needs numbers behind it.

Churn is the second lever, and at micro-SaaS scale it moves the price more than it does for larger companies. Losing 3 percent of customers a month means losing roughly a third of the customer base in a year, and each lost customer is a large share of a small base. Monthly churn under 2 percent supports a premium multiple, churn between 5 and 8 percent drags it down, and churn above 8 percent can cut the valuation sharply. Buyers also look at revenue churn separately, because losing one large customer hurts more than losing ten small ones.

Founder dependence is the hidden discount most sellers underestimate. If the business needs 30 hours a week of the founder's time, the buyer has to replace that labour, and the multiple falls to reflect it. Products with documented systems, automated onboarding, and support that someone else can run sell for more. The same applies to customer concentration: if one customer is a quarter of revenue, a buyer will price in the risk of losing them. Clean code, a modern stack, and a domain with real search authority also add value, especially for pre-revenue products valued on replacement cost.

Before you list or make an offer, run both calculations yourself. Take the trailing twelve months of revenue, annualise the current MRR, apply a 2x to 5x ARR range, then cross-check against annual profit multiplied by 2.5x to 4.5x. If the two answers are far apart, the lower one is closer to what a buyer will actually pay. And remember that the multiple is a starting point for negotiation, not a guarantee: the final price depends on how well you can prove the numbers with Stripe exports, bank statements, and analytics access.

Before you trust any multiple, check it against real comparable sales rather than asking prices. Marketplace listings show what sellers hope to get, not what buyers actually paid, and the gap between the two is often large. Look for completed sales of similar products with similar revenue, growth, and churn, and ask the marketplace or broker for the closing multiple rather than the listed one. A multiple that looks cheap on paper can still be expensive if the product's revenue is declining or its biggest customer is about to leave, and a multiple that looks high can be fair if the growth and retention are strong.