Business Valuation Calculator
Get an instant estimate of your business value using multiple valuation methods. This calculator uses industry-standard formulas including SDE multiples, EBITDA multiples, DCF analysis, and asset-based valuation.
Business Information
Financial Information
Valuation Results
Understanding Business Valuation
Business valuation is the process of determining the economic value of a business or company. This calculator uses multiple industry-standard methods to provide a comprehensive valuation range.
Valuation Methods Explained
SDE Multiple Method
Seller's Discretionary Earnings (SDE) is the most common method for valuing small businesses. It adds back owner compensation, benefits, and non-essential expenses to show the true earning potential for a new owner.
- Best for: Businesses under $5M revenue
- Typical multiples: 2-4x SDE
- Factors: Industry, growth, risk
EBITDA Multiple Method
EBITDA multiples are used for larger businesses with professional management. This method focuses on operational performance excluding owner-specific factors.
- Best for: Businesses over $5M revenue
- Typical multiples: 3-8x EBITDA
- Factors: Industry, size, margins
DCF Method
Discounted Cash Flow values a business based on projected future cash flows, discounted to present value. Best for high-growth or predictable businesses.
- Best for: Growth companies
- Key inputs: Growth rate, discount rate
- Most accurate for: Predictable cash flows
Asset-Based Method
Values the business based on net asset value (assets minus liabilities). Often used as a floor value or for asset-heavy businesses.
- Best for: Asset-heavy businesses
- Calculation: Assets - Liabilities
- Use case: Minimum value baseline
Factors Affecting Business Value
- Financial Performance: Revenue growth, profit margins, cash flow consistency
- Market Position: Brand strength, customer base, competitive advantages
- Risk Factors: Customer concentration, owner dependency, industry trends
- Growth Potential: Market opportunity, scalability, expansion possibilities
- Operational Efficiency: Systems, processes, management team
- Industry Trends: Market growth, consolidation, technology disruption
Next Steps After Valuation
- Professional Valuation: Consider hiring a certified business appraiser for official valuation
- Value Enhancement: Identify areas to increase business value before selling
- Exit Planning: Develop a 2-5 year plan to maximize value at exit
- Market Research: Research recent sales of similar businesses
- Financial Cleanup: Organize financials and documentation
- Broker Consultation: Speak with business brokers about market conditions