Michael Girdley of Dura Software explains how to acquire software companies, build deal flow, assess valuation expectations, structure seller notes and earn-outs, and use acquisition as a growth strategy.
Listen to the EpisodeEpisode 178 | Runtime: 25:57 | Audio Episode
Hear Michael Girdley break down software company acquisition strategy, deal sourcing, valuation discipline, funding, and practical deal structure.
Episode
178
Runtime
25:57
Topic
Software company acquisitions
Format
Founder interview
Three acquisition lessons from Michael Girdley's experience building Dura Software through multiple software company purchases.
Michael explains why messy books, weak presentation, and obvious operational gaps can create opportunity for buyers who know how to underwrite risk and improve the business after completion.
Dura Software refined its acquisition strategy by segmenting the software market, learning which opportunities to reject quickly, and building a repeatable process for reviewing deal flow.
Cash up front, earn-outs, seller notes, and renewal contingencies all have a role when the buyer understands what the seller wants and where the risk sits in the business.
In this episode, Jonathan Jay speaks with Michael Girdley, Executive Chairman and Co-Founder of Dura Software, about building a software acquisition platform rather than starting every business from zero. Michael explains why he chose acquisition over organic growth, how Dura Software found its first target, and why the early search process required hundreds of reviews, direct conversations, broker engagement, and disciplined valuation work.
The discussion moves into buyer psychology and deal selection. Michael shares a counterintuitive acquisition lesson: the better a deal is packaged, the less likely it may be to offer operational upside. He also explains why unrealistic seller valuation expectations are difficult to change, why direct outreach can produce more interesting opportunities, and how on-market and off-market deal flow both fit into a serious acquisition pipeline.
Michael also covers funding and structure, including Dura Software's corporation model, investor capital, permanent holding company strategy, seller notes, earn-outs, and contingent payments tied to client renewal risk. The episode gives acquisition entrepreneurs a direct view of how a repeat buyer thinks about software company valuation, risk, process, and post acquisition value creation.
Michael explains that building from zero to meaningful recurring revenue can take years and carry a heavy emotional cost. Acquisition allowed Dura Software to buy existing software businesses where other buyers were missing value.
The team used broker conversations, direct outreach, on-market review, off-market searching, and a high volume of calls. They reviewed hundreds of opportunities, made offers on two, and closed one after around eight months.
Dura Software customises structure around seller motivation and business risk. Deals can include cash up front, seller notes, earn-outs, and contingent consideration linked to events such as major client renewals.
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