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Source code, SaaS & technology escrowTechnical verificationIP services

Software escrow for M&A

Software escrow for M&A, protecting the deal.

When software is a material asset in a transaction, its value depends on whether it survives a lost founder or a failed integration. Escrow keeps the asset preserved, transferable, and recoverable, set up on the deal's timeline.

By deal type

One structure, three deal types.

Acquirer, investor, or lender: the interest differs, the risk is the same. The value sits in software that might not be recoverable when it matters.

One escrow structure
Acquirer / M&A

The asset is the code.

You're buying software that may not survive a lost founder or an undocumented build. Escrow keeps it recoverable through the close and after.

Escrow rolePreserve and transfer the asset through the deal.
Investor

A condition of the round.

Make software protection a term of the financing, so the portfolio company's software stays recoverable if the company stumbles.

Escrow roleProtect the asset behind the investment.
Lender

Collateral that survives.

Taking IP as collateral? Escrow makes the asset defensible and recoverable if the borrower defaults, so it is worth something in a workout.

Escrow roleKeep IP collateral defensible on default.
Setup

Set up on the deal's timeline.

Escrow that arrives after the closing date protects nothing. Most agreements move from intro to signature in under two weeks, transaction-grade speed for diligence.

01
Scope

We scope the deposit to what recovery actually needs: source code, build environment, dependencies, and the documentation to stand it up.

02
Draft

We draft the escrow agreement around your deal structure and the release conditions your interest requires, working with transaction counsel. See software escrow agreements →

03
Sign

It is signed and the deposit is in before the closing date, so the protection exists when the deal does.

Sample language

Language built for the transaction.

Illustrative escrow language for an IP-collateral structure, not legal advice. Yours is drafted to your transaction and its security documents.

7.2   Release to Secured Party
Upon a Foreclosure Event under the Security Agreement, EscrowTech shall release the Deposit Materials to the Secured Party so the collateral can be maintained and operated, per the procedure stated in this Agreement. EscrowTech does not determine whether a Foreclosure Event has occurred; it acts on the notice and evidence this Agreement requires.
Why it's written this way

The release ties to your Security Agreement, not a generic trigger, so it protects the secured party's actual interest. EscrowTech drafts and administers the escrow agreement only. It does not adjudicate the foreclosure or decide the underlying deal.

Storage & proof

Two vaults. One in a granite mountain.

Deposits are held in two physical, US-based vaults, one inside a granite mountain, monitored around the clock. The provider has to satisfy the people who approve the deal, and EscrowTech is the one their legal teams already recognize.

In operationSince 1992
Buyer recognition80% of the Fortune 500
StorageTwo US sites
In-houseCounsel + developers
CustodyDocumented chain
FAQ

Transaction escrow, answered.

The questions M&A teams, investors, and lenders ask most often.

What is software escrow in M&A and financing?

Software escrow in M&A and financing places the source code and everything needed to rebuild the software with a neutral third party. When the software is a material asset in the deal, escrow keeps it recoverable if the founder, the team, or the vendor is no longer there to run it.

How does escrow protect the software asset in a deal?

The materials sit with EscrowTech, not with any party to the deal, and are released only on the conditions written into the agreement. If the company behind the software fails or a key person leaves, the acquirer, investor, or lender can still recover and run what they paid for.

What three deal types does escrow support?

Three. In an acquisition, the code is the asset you are buying. In an investment round, escrow is a condition that protects the portfolio company's software. In lending, it makes IP collateral defensible if the borrower defaults. One structure, drafted to each.

How fast can escrow be set up for a diligence timeline?

Most agreements move from intro to signature in about two weeks, so the escrow is in place before the closing date rather than after it. Escrow being the slow part of a deal is usually a provider problem, not an escrow problem.

What is IP verification in a transaction?

Verification proves the deposit would actually rebuild and run, from a file listing up to a full build and comparison. It is a menu of options matched to the deal's risk. EscrowTech does not compile or run every deposit by default; the top of the ladder is never standard or automatic.

What happens to the escrow after the deal closes?

The agreement can stay in force for as long as the asset matters. After the deal closes, escrow keeps protecting the buyer, the investor's portfolio company, or the lender's collateral, and it can be re-verified as the software changes.

Who holds the asset and stays neutral?

EscrowTech holds the deposit as a neutral third party and administers the escrow agreement only. It does not take a side, and it does not decide the underlying deal or dispute; it acts on the notice and evidence the agreement requires.

How is transaction escrow priced?

Transaction escrow is priced to the structure and how far you verify, not a flat rate. Tell us the deal type and what the software is worth to it, and you will know what you are committing to before you begin.

Make it safe to depend on.

Tell us about the transaction and what the software asset is worth to it. We'll structure the escrow to close on time.

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