Business Valuation Calculator
Estimate what your business is worth using four standard methods — SDE multiple, earnings multiple, discounted cash flow, and asset-based. Enter your numbers and get a valuation range in seconds.
Revenue & Earnings
Total top-line sales
After all expenses, before owner salary
Salary + perks paid to working owner
Used for DCF method
Assets & Liabilities
Equipment, inventory, receivables, etc.
Loans, accounts payable, etc.
Growth Assumptions(for DCF method)
Expected revenue / cash flow growth
Risk rate — typically 15–25% for small biz
Industry Multiple
Select a preset above or enter a custom value
Valuation Results
The Four Valuation Methods
Each method answers a different question about your business's value. Most transactions use 2–3 in combination.
SDE Multiple
SDE × 2.5× (typical small biz)
The most common method for businesses under $5M in revenue. SDE — net income plus owner's compensation — represents the total economic benefit available to a new owner-operator. A 2.5× multiple is typical; well-run businesses with recurring revenue can reach 3–4×.
Earnings Multiple (Industry)
SDE × industry-specific multiple
Applies a market-derived multiple based on comparable sales in your industry. Multiples vary widely — a restaurant may trade at 2× SDE while a SaaS business trades at 6–8×. This method anchors your value to what buyers actually pay in your sector.
Discounted Cash Flow (DCF)
Cash Flow × (1 + g) ÷ (r − g)
Calculates the present value of future cash flows using expected growth and a risk-adjusted discount rate. Best for businesses with predictable, growing cash flow. Most small business buyers use 15–25% as the discount rate.
Asset-Based
Total Assets − Total Liabilities
Calculates the business's net book value — what remains after paying all obligations. Most relevant when the business has significant tangible assets (equipment, real estate, inventory). Rarely represents the full value of a profitable going concern.
Industry Multiple Reference
Typical SDE multiples paid in actual transactions. Actual multiples depend on business size, growth rate, customer concentration, and owner-dependence.
| Industry | Typical Range | Key Value Drivers |
|---|---|---|
| Restaurant / Food Service | 1.5–3.0× | Location, lease terms, brand recognition |
| Retail | 1.5–2.5× | Inventory quality, e-commerce presence, location |
| Construction / Trades | 2.0–4.0× | Licensed staff, backlog, recurring contracts |
| Professional Services | 2.5–4.0× | Client retention, recurring fees, staff transferability |
| Healthcare / Medical | 3.0–6.0× | Payer mix, patient retention, regulatory compliance |
| Manufacturing | 3.0–5.0× | Equipment condition, customer diversity, IP |
| Technology / SaaS | 4.0–8.0× | MRR, churn rate, gross margin, growth rate |
| E-Commerce | 2.0–4.0× | Brand, SKU diversity, logistics efficiency |
Sources: BizBuySell transaction data, IBBA Market Pulse. Multiples shown for SDE-based valuations on businesses with $250K–$2M SDE.
Revenue Trend
A business growing 20% year-over-year commands a significantly higher multiple than one that is flat or declining — even at the same SDE level. Buyers pay for trajectory.
Recurring Revenue
Contracted or subscription revenue reduces buyer risk and pushes multiples up. A business with 70% recurring revenue is worth considerably more than one that resets each month.
Owner Dependence
If the business cannot run without you, the multiple suffers. Buyers discount heavily for key-person risk. Documented processes and a management layer increase value.
Frequently Asked Questions
Related Resources
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Employee Cost Calculator
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