A guide to the lifecycle of your acquisition, from requesting startup access to closing with escrow
Last updated: July 25th, 2023
We'll update you with the progress of your acquisition by email and through your acquisition dashboard, My deals.
If you're ever unsure what's happening with your acquisition of a particular startup, just refer to the status on My deals.
Below, is a guide to the different statuses and what they mean.
Requesting startup access
You've requested access to the startup. You must now wait for the seller to approve or reject your access. If you haven't done so already, send the seller a message to introduce yourself. Learn other ways to keep sellers on your side in this guide to buyer etiquette.
You now have full access to this startup listing. You can freely chat with the seller and view their private information like URL, name, pitch deck, and lots more. We recommend jumping on a call with the seller as soon as possible after they approve your access.
The seller has rejected your access request. Perhaps they're already in talks with another buyer or don't think you're a good fit for their business. A rejection can sting, but it's better that than wasting time on a dead end. You'll find a better match with another founder.
The seller has suspended your access. You might've agreed to part ways, or perhaps the seller has found a better fit for their business. No need to dwell on the reason unless it comes as a surprise, but instead move on to the rest of your startup shortlist.
Your access has been revoked. This is most common when the seller accepts another buyer's letter of intent (LOI). Accepting an LOI means they can't discuss their startup with any other buyers and those same buyers will have their access revoked.
The seller is waiting on you to send a letter of intent (LOI). When you've appraised their startup, done your initial due diligence, and met them several times on a call, make an initial offer in minutes using our LOI builder.
You've sent an LOI to the founder of the startup. They can accept or reject the LOI, and in the meantime, keep your deal moving by regularly checking in with the seller via chat.
The seller has accepted your LOI. You now enter final negotiations to agree on terms, move to due diligence, and sign an asset purchase agreement.
The seller has rejected your LOI. Hopefully they explained why in their rejection message or subsequent conversations. You can then negotiate and send a revised LOI. Or, this could be the end of the road with this particular founder and startup.
You or the seller canceled the LOI. You can cancel an LOI before or after the seller accepts it, perhaps due to negotiating new terms that require you to send a revised LOI. Or, maybe you wanted to cancel the LOI for other reasons.
Your LOI was suspended. This can happen when the seller accepts one of multiple LOIs from different buyers, which auto-suspends all outstanding LOIs other than the one accepted.
Finalizing an APA
The seller is awaiting your asset purchase agreement (APA). Build one in minutes, customized to your deal (including post-closing conditions), using the APA builder.
You've sent an APA to the seller. Just like the LOI, they can accept or reject it, though rejections at this stage are usually just tweaks or last-minute negotiations.
The seller accepted your APA. Now you'll move on to build your escrow transaction and then execute it on Escrow.com (or elsewhere, if you chose your own escrow agent).
The seller rejected your APA. This can happen if you need to make last-minute changes to the APA or it contains errors.
You or the seller canceled the APA. Since the APA can legally bind you to the acquisition, you should obtain permission from the seller to cancel the APA if they've already accepted it. Likewise, the seller should obtain your permission if they want to cancel it.
Escrow and closing
You need to start escrow. Using our escrow builder, send the seller proposed escrow details for them to accept so you can close on Escrow.com.
Escrow details sent
You send escrow details to the seller. They can accept or reject your details, and if rejected, you'll need to chat with the seller to prepare and send revised details for them to accept.
Escrow details rejected
Your seller rejected the escrow details. They should've given you a reason along with the rejection message, and you can then revise the proposal and resend escrow details.
Escrow details canceled
You canceled the escrow details. You might do this to revise them before the seller accepts them and you move to Escrow.com.
Escrow in progress
You and the seller have agreed escrow details. Now you move to accept terms on Escrow.com. You will then send your acquisition funds to Escrow.com. The seller will transfer the acquisition assets once Escrow.com has verified your funds.
You have approved all of the seller's transferred assets. Escrow.com will now release your closing payment to the seller. Once escrow completes, please mark the startup as Acquire'd.
Congrats! Your acquisition is now complete.
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