Founders who talk to Solen usually know within two weeks whether we are a good fit. We ask a small set of questions early, we are candid about what we see, and we give a clear answer before anyone commits serious time to the process.
We are often asked what makes Solen say yes. The answer starts with how we assess fit, and how quickly. This article explains the software acquisition criteria we apply in a first conversation, and why an early no is not a judgment on your business.
Why We Give Founders an Answer Early
Running a software company is a full-time job. An evaluation that drifts for months costs a founder focus, momentum, and sometimes confidentiality. We think that is a poor way to treat the people we hope to partner with.
So we front-load the questions that matter. The things that determine fit with permanent capital are usually visible in a first conversation and a short follow-up. We would rather give you a clear answer in two weeks than a slow maybe.
What We Look at in the First Two Weeks
Three questions decide most of it.
First, how does revenue renew? Loyal customers who renew on goodwill are wonderful. Predictable, contracted revenue is what lets a business weather a hard year, and it is the first thing we ask about.
Second, how concentrated is the customer base? If one or two customers make up a large share of the total, the shape of the company can change overnight. A broad base means durability.
Third, where does the product sit in the customer’s day? Software at the center of a daily workflow is hard to replace. Software at the edge, however useful, is a harder foundation to build decades on.
In short, we are looking for:
• Contracted revenue that renews by agreement, not goodwill, so a hard year does not hollow out the base.
• A broad customer base, so no single departure can reshape the company overnight.
• A product at the center of customers’ daily work, the kind that is hard to replace.
None of this requires a data room. We will ask for off-the-shelf financials, the reports your accounting system already produces, so our answer rests on real numbers rather than impressions. If it already exists, it is enough. Nothing needs to be prepared specially for us.
Why Durability Matters More Than Growth
We invest as permanent capital. No predefined exit, and a plan to hold for decades. That model only works when the foundation is durable.
Growth is good. Durability is what we underwrite. A business that compounds quietly for twenty years is worth more to us, and to its team, than one that grows fast on a fragile base.
What an Early No Really Means
Sometimes those first conversations show us the fit is not there yet. When that happens, we say so quickly, and we say why.
An early no is not a verdict on your business. It usually means one of the three foundations needs work, and much of what we flag is fixable within a year or two. Because the answer comes early, you spend two weeks finding out, not two quarters, and you leave with a candid read on where your business stands. The door stays open.
What This Means for Your Business
If you are a founder thinking about the long term, the lesson is simple. The qualities that make a business a strong fit for permanent capital are the same ones that make it more valuable to anyone: durable, contracted revenue, a broad customer base, and a product your customers cannot easily live without.
If you want to know where your business stands, reach out to the Solen team. Within two weeks of a first conversation, we can usually tell you whether we are a good fit, and we will tell you why either way.
Frequently Asked Questions
How quickly does Solen tell founders whether it is a good fit?
Usually within two weeks of a first conversation. The questions that determine fit with permanent capital are visible early, so we give founders a clear answer before anyone commits serious time to the process.
What are Solen’s software acquisition criteria?
We look for durable, contracted recurring revenue, a broad customer base without heavy concentration, and mission-critical software that sits at the center of customers’ daily work. We assess these against the standard of permanent capital: a business we can hold and grow for decades.
What does a founder need to prepare for a first conversation?
Very little. Off-the-shelf financials, the reports your accounting system already produces, plus a sense of how revenue renews, rough customer concentration, and a description of what the product does. A data room is not needed to establish fit.
Does an early no from Solen mean my business is weak?
No. It means the business, as it stands today, does not yet match the durability profile permanent capital requires. We explain exactly what we saw, and much of it is fixable within a year or two.
Can I talk to Solen again after a no?
Yes. The door stays open. Founders who strengthen contracted revenue, broaden their customer base, or move their product closer to the center of the workflow are welcome to restart the conversation.