Model what you actually receive under different performance scenarios. See how upfront payment, earnout structure, and milestone achievement affect your total proceeds.
| Year | Downside (50% target) | Base (100% target) | Upside (130% target) |
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An earnout is a deal structure where a portion of the purchase price is paid after close, contingent on the business hitting agreed performance targets. It bridges valuation gaps between buyer and seller by tying future payments to actual results.
Earnouts work best when the business has strong forward momentum that the seller believes in but the buyer cannot fully price. They are common in high-growth SaaS, fintech, and digital media transactions where historical earnings do not reflect future potential.
Sellers face real risks: the buyer controls the business post-close and can influence whether targets are hit. Earnout disputes are among the most common sources of post-close litigation. Sellers should negotiate clear metric definitions, anti-sandbagging provisions, and independent audit rights before signing.
Structuring an earnout? Speak with Acquiry before you sign.
Talk to Our TeamThis tool is for indicative modelling purposes only. Earnout structures vary significantly by deal and jurisdiction. Results do not constitute financial, legal, or tax advice. Engage a qualified M&A advisor and legal counsel before entering any transaction.