Business Valuation Calculator
Estimate what your small business is worth using SDE, revenue, and EBITDA multiples — the same methods buyers, lenders, and brokers use.
Add back what an outside CEO wouldn't pay themselves.
Personal expenses run through the business (auto, insurance, travel).
Professional Services: Recurring clients add 0.5-1x
Typical SDE multiple: 2x–3.5x · Revenue multiple: 0.5x–1.2x
Estimated Value
$672,300
Estimated value · Professional Services
$507,600 – $888,300
SDE base: $235,000
$405,000 – $972,000
Revenue base: $750,000
$453,600 – $756,000
EBITDA base: $140,000
Valuation Methods Explained
The default for owner-operated businesses under ~$5M in revenue.
- Base: Seller's Discretionary Earnings
- Multiple: 1.5x–5.5x by industry
- Best for: Main Street businesses
Useful when profit fluctuates or recurring revenue dominates.
- Base: Trailing 12 months revenue
- Multiple: 0.3x–8x by industry
- Best for: SaaS, e-commerce, agencies
The standard for businesses with professional management or PE buyers.
- Base: Earnings before interest, tax, D&A
- Multiple: 2.5x–10x by industry
- Best for: Lower middle market ($2M+ EBITDA)
Frequently Asked Questions
How to value a small business
Three valuation methods dominate small business transactions. Each is appropriate in different situations, and serious buyers usually triangulate across all three before settling on a price.
The SDE multipleis the workhorse method for Main Street businesses (under ~$5M revenue, owner-operated). It values the business based on Seller's Discretionary Earnings — net profit plus owner salary, owner perks, depreciation, amortization, and interest. Typical SDE multiples run 1.5x–4x, with the median at roughly 2.4x SDE across all industries per BizBuySell data.
The revenue multiple is used when profit is volatile, growing fast, or unreliable — and when recurring revenue is the dominant value driver. SaaS companies, agencies with retainers, and high-growth e-commerce brands are typically valued on revenue. Multiples range from 0.3x revenue for restaurants to 8x+ ARR for SaaS with strong retention.
The EBITDA multiple kicks in at the lower middle market — businesses with professional management, $2M+ EBITDA, and PE/strategic buyers in the conversation. EBITDA multiples typically run 3x–10xby industry. Because EBITDA doesn't add back owner compensation, a single business will usually have a higher SDE than EBITDA.
| Method | Base | Typical Multiple | Best For |
|---|---|---|---|
| SDE | Net profit + owner salary + perks + D&A + interest | 1.5x–5.5x | Owner-operated, <$5M revenue |
| Revenue | Trailing 12-month revenue | 0.3x–8x | SaaS, agencies, e-commerce |
| EBITDA | Net profit + D&A + interest (+ tax for C-corps) | 2.5x–10x | $2M+ EBITDA, manager-run |
What multiple is your business worth?
Industry sets the floor and ceiling of your multiple. A clean services business in a hot sector will pull a higher SDE multiple than a struggling retail shop with the same earnings. The table below shows typical ranges by industry, drawn from BizBuySell, IBBA, and broker survey data.
| Industry | SDE Multiple | Revenue Multiple | Notes |
|---|---|---|---|
| Professional Services | 2.0x–3.5x | 0.5x–1.2x | Recurring clients add 0.5–1x |
| E-commerce | 2.5x–4.0x | 0.6x–2.0x | Brand + repeat rate drive value |
| Restaurant / Food | 1.5x–2.5x | 0.3x–0.6x | Location and lease are everything |
| Retail | 1.8x–2.8x | 0.3x–0.8x | Inventory turnover matters |
| SaaS / Software | 3.0x–5.5x | 2.0x–8.0x | ARR multiple usually leads |
| Construction / Trades | 2.0x–3.5x | 0.4x–0.8x | Licensed crew + backlog adds value |
| Manufacturing | 2.5x–4.5x | 0.6x–1.5x | Equipment often valued separately |
| Marketing / Creative Agency | 2.0x–3.5x | 0.7x–1.5x | Client concentration cuts multiple |
Factors that move your multiple up:recurring revenue (especially MRR/ARR contracts), customer diversification (no single customer over 10% of revenue), proven growth (15%+ YoY), strong gross margins, documented SOPs, manager-run operations, long-term leases on critical sites, transferable licenses, owner working <20 hours/week.
Factors that move your multiple down: the owner is the business (sells, makes, delivers everything), customer concentration over 25%, declining revenue, messy books or reconstructed financials, short remaining lease, regulatory risk, dependence on a single vendor or platform, large undocumented add-backs.
How to increase your business valuation before selling or financing
The gap between a 2x and a 3x SDE multiple on a $200K SDE business is $200,000 in your pocket. Six levers reliably move that needle — most take 12–24 months to fully realize, so start before you list.
1. Clean up your books.Buyers and lenders discount any business where they can't trust the numbers. That means monthly reconciliation, every transaction categorized correctly, and personal expenses cleanly separated as add-backs. Tools like Jupidautomate this for sole proprietors and LLCs — connecting your bank, categorizing transactions, and producing a clean P&L you can hand to any buyer or broker.
2. Reduce owner dependence.The single biggest valuation killer is “the business is the owner.” If you sell, make, and deliver everything yourself, the multiple drops fast. Hire and document a second-in-command, even part-time. Aim to be working in the business no more than 20 hours/week by the time you sell.
3. Lock in recurring revenue. A retainer is worth 2–3x what a one-off project fee is worth. Convert as many customers as possible onto annual contracts, retainers, or subscriptions. Even simple maintenance plans for service businesses dramatically reshape your earnings story.
4. Document SOPs. A binder (or Notion site) of standard operating procedures signals to buyers that the business will keep running after you leave. Customer onboarding, delivery, billing, vendor management, hiring — every repeatable process should be written down.
5. Eliminate customer concentration. If one customer is 30% of revenue, your multiple gets cut. Aim for no single customer above 10–15%. This takes time — start now by diversifying your sales pipeline.
6. Normalize and document add-backs. Every dollar of legitimate add-back (owner salary, vehicle, insurance, one-time legal fees, etc.) is worth 2–4x in valuation. But buyers will only accept add-backs you can prove with clean documentation. Vague claims get rejected. Clean books make every add-back stick.