Collateral that survives a workout.
When a lender takes software IP as collateral, escrow makes the asset defensible and recoverable, so the collateral holds value if the borrower defaults.
Collateral you can actually recover.
A security interest in software is only as good as your ability to operate it. Escrow puts custody of the asset in the middle of the loan.
Lender extends credit
Credit is advanced with the borrower's software and IP pledged as security behind the facility.
IP held in escrow
The source and the materials to run it are deposited with a neutral third party, with release tied to your security agreement.
The borrower defaults
The facility goes into workout or the borrower fails. The pledged collateral is now what stands behind the loan.
Recoverable to the lender
Escrow releases on the agreed conditions, so the lender holds a defensible, operable asset, not just a claim to code.
The escrow custody sits between the loan and the default, so recovery is defined before you need it.
Starting at $1,595 a year, custom-priced to your structure. See pricing →
An asset that holds its value.
Without escrow, pledged IP can be unrecoverable when it matters most. Escrow and verification make it defensible.
A lien on code you cannot build or run is a claim, not an asset. Escrow holds the materials to operate the software and ties their release to your security agreement, so the collateral behind the facility is one you can actually recover.
Escrow makes the pledged asset defensible and recoverable. It is not a guarantee of repayment, and the top of the verification ladder is never standard or automatic.
For the whole transaction, see M&A, investors & lenders. See escrow for transactions →
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.
IP collateral, answered.
The questions lenders and their counsel ask about pledged software as security.
What is IP collateral escrow?
IP collateral escrow is an arrangement where the software or IP a borrower pledges as security is held by a neutral third party. If the borrower defaults, the lender can recover a working asset on the conditions written into the escrow agreement, rather than a lien on code it cannot operate.
How does escrow make IP collateral recoverable?
The deposit holds the source code and the materials needed to build and run the software, and release is tied to your security agreement. Because a neutral party holds those materials and can release them on default, the pledged IP becomes something the lender can actually operate, which is what makes it recoverable.
What happens if the borrower defaults?
On a default or a workout, the escrow releases the deposited materials to the lender on the conditions set out in the agreement. EscrowTech administers that release as a neutral third party; it does not decide the default itself. The lender is left holding a defensible, operable asset instead of a claim it cannot act on.
Is the collateral independently verified?
It can be, to the level you choose. EscrowTech offers verification ranging from a file listing up to build verification, matched to the risk and the size of the facility. Verification is a menu of options, never automatic, so the top of the ladder is not included by default; you decide how far the deposit is checked.
Who holds the collateral and stays neutral?
EscrowTech holds the collateral as a neutral third party and administers the escrow agreement between the lender and the borrower. It stays neutral and does not adjudicate the default or decide the underlying loan; it holds the deposit and releases it on the agreed conditions, nothing more.
How does this fit a lending or workout scenario?
It fits wherever software or IP secures a loan: venture debt, asset-based lending, or a distressed facility heading into workout. The escrow sits behind the security interest, so if the borrower fails, the collateral the lender underwrote is one it can recover and operate, not one that evaporates with the company.
What does a collateral deposit include?
A collateral deposit typically includes the source code, build instructions, and the dependencies, configuration, and documentation needed to compile and run the software. The aim is a deposit complete enough to operate the asset, so what the lender recovers is usable rather than a partial code drop.
How is it priced and set up?
IP collateral escrow starts at $1,595 a year, custom-priced to your structure and how far you verify the deposit. Setup runs alongside your security agreement: the release conditions are drafted to match the facility, and the deposit is taken in and dated from the start.
Make it safe to depend on.
Tell us about the facility and the IP behind it. We'll structure the collateral escrow around your security agreement.
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