A guide to closing safely with Escrow.com
Last updated: March 24, 2024
Selling your business to someone you met on the internet can be a bit unsettling.
We verify IDs, funds, and take other measures to minimize foul play and ensure everyone follows the rules of the marketplace.
But to protect your acquisition, and to prevent any dispute with a buyer you've come to trust, we strongly recommend closing with escrow.
Our CEO, Andrew Gazdecki, and general counsel, James Graves, explain the importance of using escrow in the video below. When you're ready, skip to the guide.
Why close using escrow?
How to close your acquisition safely with Escrow.com
Review and accept the buyer's escrow details
Once you and the buyer have signed an APA, your buyer will then send you escrow details to accept before you move to Escrow.com to create your transaction.
1. Click View escrow details
2. Click Next.
3. Enter the email address you'll use with Escrow.com. It will default to your Acquire.com email address, but if you have an existing Escrow.com account, you can use it instead.
4. Review the escrow details to ensure you're happy with them. Then click Accept.
If you spot an error or want to renegotiate the escrow details, click Reject and then add a message on the next screen explaining why. The buyer can then revise the details and re-send them to you for approval.
5. Once you accept the escrow details, escrow begins.
Agree to terms on Escrow.com
The Escrow.com screens and process below might vary if Escrow.com later updates its user interface. If you're unsure, please email support@escrow.com.
6. Click Agree to escrow terms to move to Escrow.com to create your acquisition transaction.
7. Sign in or create your account on Escrow.com.
8. Click Agree on your Escrow.com dashboard.
9. Choose Wire/Bank Transfer as settlement option
Wire/Bank Transfer is the only settlement option we support currently.
10. Enter your payment details
Verify your details on Escrow.com
11. You also need to verify your details on Escrow.com. Skip to step 12 if you're still on the Escrow.com website, otherwise click Verify your details from your acquisition dashboard.
12. Verify your Escrow.com account by entering your ID details.
Please ensure your Escrow.com account type matches how you signed the APA (individual or company). Otherwise, you may need to cancel your existing APA and re-sign it to ensure you pass this critical verification step on Escrow.com.
After verifying your account (and business), you'll then be able to agree to escrow terms, moving your acquisition forwards.
Now return to Acquire.com.
Wait for Escrow.com to verify your APA
13. Escrow.com may need extra time to verify the details in your APA, and if so, you'll see the screen below. Please wait or contact support@acquire.com if you need help.
Wait for Escrow.com to verify the buyer's funds
14. The buyer now selects a payment method and transfers their funds. You'll receive an email when it's time to transfer your assets (and your acquisition status will update).
In the meantime, you'll see the status as "Funds not secured" circled below on Escrow.com.
Transfer your assets
15. We'll email you and update your acquisition status when to transfer your assets. Once you've transferred your assets, click Mark assets as sent to go to Escrow.com.
Please never transfer acquisition assets until Escrow.com verifies the buyer's funds.
16. Mark your assets as sent on Escrow.com by clicking the box under the actions column next to the closing milestone. Then click Process Actions.
(Note the transaction status has now changed to Buyer funds secured by Escrow.com – this means your buyer's funds have been safely verified and escrowed.)
Wait while the buyer inspects your assets
17. Your Escrow.com transaction status now updates to "Seller delivered milestone". Now the buyer must confirm receipt of your assets and approve them.
Your escrow details include an inspection period (usually a day or two) for the buyer to review and approve your assets. Escrow.com releases your closing payment immediately after the buyer approves your assets.
18. Your acquisition status will again change when the buyer accepts your assets. You don't need to do anything here unless the buyer rejects your assets.
19. If your acquisition was all-cash or all-cash plus seller financing, your transaction closes once you receive the closing payment. You just got Acquire'd! 🎉
Your Acquire.com closing fee is deducted automatically from the buyer's closing payment from Escrow.com – no need to transfer anything to us separately.
Request post-closing or conditional payments
20. Did you agree to a seller holdback, earnout, or some other conditional payment post-closing? Once you meet the condition for payment, request it through Escrow.com.
Log in, click the box above Delivered under the actions column. Repeat steps 16-19 for the post-closing milestone.
21. Once the buyer has approved your post-closing milestone payment, your status will update and Escrow.com will release payment. That's it! Escrow has completed.
What happens if the buyer rejects your assets?
Buyers can reject your assets or requests for post-closing payments during the agreed inspection period. If this happens, we recommend speaking to the buyer to resolve the problem to both of your satisfaction. Talking can resolve most issues.
However, email Escrow.com support if you need help to resolve the issue.
What if you use your own escrow agent?
You're welcome to use your own escrow agent, though we recommend Escrow.com since they're global experts and we cover your escrow fee.
Step 3 will change to show the escrow agent your buyer has chosen. We email this agent a copy of your APA to speed up the escrow process.
You can also ignore steps 5-13 since we have no part in the escrow process. However, please mark your startup as Acquire'd once your escrow process ends.
Still need help?
Please search the help center again or contact us at support@acquire.com.