Estimated Business Value
$80,000.00
How it works
The Business Valuation Calculator estimates the market value of a business using three standard methods: the income approach (multiple of earnings or DCF), the market approach (revenue multiple), and the asset-based approach. Enter your financial figures and get a valuation range.
Business valuation is needed for acquisitions, buy-sell agreements, partnership buyouts, estate planning, SBA loan applications, and investment decisions. While professional appraisals cost $5,000–$50,000, quick-estimate calculators are useful for preliminary negotiation, strategic planning, and reality-checking offers.
How to use it: enter the business's annual revenue, EBITDA (earnings before interest, taxes, depreciation, amortization), net income, and total assets. Select the industry (different industries trade at different multiples). The calculator returns valuations under each method and a recommended range.
Valuation methods: - EBITDA multiple: most common for SMBs. Service businesses: 2–4×, SaaS: 6–12×, manufacturing: 3–5×, retail: 1–2×. The tool applies industry-appropriate ranges. - Revenue multiple: used for high-growth or pre-profit businesses. SaaS: 3–8× ARR, e-commerce: 0.5–2× revenue, professional services: 0.5–1.5× revenue. - Discounted Cash Flow (DCF): projects future cash flows and discounts to present value using a required rate of return (WACC). Most rigorous but requires accurate projections. - Book value: asset-based floor, appropriate for asset-heavy businesses (real estate, manufacturing).
Goodwill and intangibles: the gap between the income-based value and the book value represents goodwill — brand, customer relationships, proprietary processes, and team.
Privacy: business financial data runs in the browser.
Frequently Asked Questions
- Small businesses ($1–5M revenue) typically sell at 2–4× EBITDA. Factors that increase multiples: recurring revenue (SaaS, subscriptions), strong growth trajectory, diversified customer base, not dependent on the owner, strong management team, proprietary IP. Factors that decrease multiples: customer concentration (one client > 30% of revenue), owner dependency, declining revenue, commodity business with thin margins.
- SDE adds back the owner's compensation (including benefits and perks) to EBITDA — used for businesses where the owner is the primary operator. SDE multiples (1–3×) are used for SMBs where a new owner-operator would replace the seller. EBITDA multiples are used for businesses with professional management that can run without the seller. SDE is more relevant for businesses under $2M revenue.
- Industry multiples provide a range — actual transaction prices vary significantly based on deal-specific factors: strategic buyer premium (buyer can achieve synergies), seller urgency, current M&A market conditions, and the quality of financial documentation. A professional business appraisal or M&A advisor is recommended for transactions above $500,000.
- The standard financial due diligence package: 3 years of profit and loss statements, 3 years of balance sheets, current year YTD financials, tax returns (personal and business), customer list (anonymized) with revenue concentration, employee list and compensation, lease agreements, and a list of assets included in the sale.