I came across this Saas app and I approached the owners and they are considering selling it founder is busy with other work and this SaaS app is basically on auto-pilot for that last 3+ years.
The revenue is slowly decreasing over the years by about 20%.
In a situation like this, would you still set the value at 3x net revenue?
I see it as a risk to take on the project since it is decreasing by 20% per year, and on top of that updating the app will take allot of time/investment unless you are very selective on what you upgrade to get the most bang for your buck.
Anyhow, what kind of formula would you use in a situation like this?