Business Valuation Calculator: What's My Business Worth?
Estimate your company's value in seconds using real industry earnings multiples. Treat it as a starting range. When you're ready for a number you can take to the table, we'll match you with a vetted M&A advisor for a free, confidential valuation.
Estimate your value
Two numbers and your industry. No email required for the estimate.
How business valuation actually works
Almost every small and lower-middle-market business is valued the same way: take a measure of profit, then multiply it by a number that reflects how much buyers will pay for a dollar of that profit in your industry. That number, the multiple, is where all the nuance lives.
For owner-operated businesses (roughly under $1M in earnings), buyers use Seller's Discretionary Earnings (SDE): net profit plus the owner's salary and one-time or personal add-backs. For larger businesses that already have a management team, buyers use EBITDA (earnings before interest, taxes, depreciation, and amortization). SDE multiples run lower than EBITDA multiples because SDE already includes the owner's pay.
Typical earnings multiples by industry
These are indicative lower-middle-market ranges. Useful for orientation, not a quote. Recurring-revenue and roll-up-favored sectors sit at the top; thin-margin, owner-dependent ones sit at the bottom.
| Industry | Typical multiple | Basis |
|---|
Ranges are aggregated, indicative figures based on typical lower-middle-market transactions and are not a valuation. See our EBITDA & SDE multiples by industry report for the full breakdown and methodology, the manufacturing valuation multiples by sub-sector for industrial sellers, or the tech M&A valuation benchmarks for disclosed SaaS and software deal data. Browse vetted sell-side M&A advisory firms when you're ready to act on your number.
What moves you within the range
- Growth. Consistent year-over-year revenue growth is the single biggest multiple driver.
- Recurring revenue. Contracts, subscriptions, and service agreements de-risk the cash flow and command a premium.
- Margins. Higher and more stable margins than your peers push the multiple up.
- Customer concentration. If one client is more than ~15-20% of revenue, buyers discount for the risk of losing them.
- Owner dependence. A business that runs without the owner is worth more than one that is the owner.
- Clean books. Reviewed or audited financials and documented add-backs hold value through diligence.
The four ways to value a business
The earnings-multiple method above is the market approach, and it's how most deals actually price. The other three get used as cross-checks:
- Market approach. Earnings times a multiple drawn from comparable sales. This is the default.
- Income approach (DCF). Projects future cash flows and discounts them to today; common for higher-growth or larger businesses.
- Asset approach. Net value of assets minus liabilities; a floor, used for asset-heavy or distressed businesses.
- Rule-of-thumb. Industry shorthand, like a multiple of revenue; a sanity check, never a final number.
Learn the full process in our guide to selling your business, or read business valuation methods explained. Compare all tool types in the business valuation tools guide.
What's a business worth at different profit levels?
People usually ask this in terms of revenue, but value tracks profit, not sales. Two companies with the same revenue can be worth very different amounts depending on what drops to the bottom line. Here's the rough market math at a few common earnings levels (illustrative, using a mid-range 4x multiple):
- $100,000 in profit (SDE): roughly $200,000 to $400,000. Smaller, owner-run businesses sit at the lower end of the multiple range.
- $300,000 in profit: roughly $750,000 to $1.5M, depending on industry and how much the business leans on the owner.
- $500,000 in profit: roughly $1.5M to $3M. At this size buyers start paying for systems and a team, not just cash flow.
- $1M in EBITDA: roughly $4M to $9M. Recurring revenue and steady growth push you toward the top.
If you're thinking in revenue terms, a common question is what a business doing, say, $1M in sales is worth. The honest answer is that it depends entirely on margin. A $1M-revenue business keeping $250,000 in profit is worth far more than one scraping by on $40,000. Run your actual earnings through the calculator above for a closer estimate.
The income approach, in plain terms
Larger and faster-growing businesses often get valued on a discounted cash flow (DCF) basis instead of a simple multiple. The idea: estimate the future cash the business will generate, then discount those cash flows back to today using a rate that reflects the risk of actually collecting them. A safer, predictable business gets a lower discount rate and a higher value. A volatile one gets marked down. It's really another way of pricing the same thing, the return a buyer earns on their investment, and the market multiple usually lands close to what a sensible DCF would say.
What this estimate leaves out
An earnings-multiple range gives you enterprise value, the value of the business itself. The check that hits your bank account is different. A few things move between the headline number and your net proceeds:
- Net debt. Outstanding loans come off the top; excess cash can be added back.
- Working capital. Buyers expect a normal level of working capital to come with the business, which can adjust the final figure.
- Taxes. How the deal is structured (asset vs. stock sale) changes your tax bill, sometimes a lot. Talk to a CPA early.
- Deal structure. Earnouts, seller financing, and rollover equity all change how much you get and when.
These are exactly the factors a good advisor models before you go to market, which is why a calculator is a starting point and not the final word.
How to read your business valuation calculator result
The range this business valuation calculator gives you is a starting point, not a finished number. Treat the low end as what a cautious buyer would offer today and the high end as what a well-prepared seller with clean financials and real growth could get. Where you land inside that range depends on the same factors buyers and lenders check before they wire money. Earnings quality and growth matter, but so does how much the business depends on you personally.
Two owners can run the calculator with identical earnings and land far apart once a real buyer looks at the numbers. The one who has reviewed financial statements, low customer concentration, and a manager who can run the place gets an offer near the top of the multiple range. The one with messy books, one big client, and no plan for who runs things after close gets an offer near the bottom, if an offer comes at all.
What a buyer or lender will check before closing
Once you move past the calculator and into an actual deal, buyers and any lender financing the purchase (often an SBA loan) will want to verify the numbers you used. Expect requests for two to three years of financial statements, tax returns, and a walkthrough of every add-back in your SDE or EBITDA. They will also look at accounts receivable aging, existing contracts, and any pending litigation. A lender doing financial due diligence on an acquisition loan is checking the same things a buyer is: can this business support the debt and still pay an owner, and does the seller's story match the paperwork.
Owner dependence gets scrutinized hardest. If you are the one who holds every customer relationship or signs off on every job, a buyer discounts for the risk that revenue walks out the door with you. Building financial and operational systems that work without you before you go to market is one of the few moves that reliably raises the multiple you land at.
When to get a formal valuation
Run the business valuation calculator any time you want a quick read on where you stand. Get a formal valuation, the kind an M&A advisor prepares using your actual financials and live market comparables, before you do anything that depends on the number: talking to a specific buyer, applying for an acquisition loan as part of a partner buyout, planning your personal financial future around the proceeds, or negotiating with a competitor who wants to acquire you. A formal valuation also gives you a documented basis if a partner, spouse, or the IRS ever questions what the business was worth at a given date.
The gap between a calculator estimate and a formal valuation is usually a few weeks and no cost to you as the seller. ProCloser's vetted M&A advisors, including no-retainer options, provide a confidential, advisor-reviewed valuation as part of the matching process, so there is little reason to plan your exit or your personal wealth around a number that hasn't been checked against the market.
Financial planning for your exit
A valuation is one input into a bigger question: what do you personally walk away with, and does that number fund whatever comes next? Owners who work backward from that answer negotiate better than owners who anchor on a headline multiple.
Start with your net target. Take the price range this calculator suggests, subtract debt, transaction fees (advisor, legal, accounting typically run 2 to 8 percent on lower-middle-market deals), and taxes under an asset sale, the structure most buyers of smaller companies prefer. If the after-tax number does not cover your next chapter, you have three levers: grow earnings before selling, improve the multiple by reducing risk, or change the deal structure.
Timing matters more than most owners expect. Selling after your best year, with clean financials and a management team that runs the business without you, routinely moves a company from the bottom of its industry multiple range to the top. Our EBITDA and SDE multiples by industry report shows how wide those ranges are; the spread between the low and high end is usually worth more than a year of profit.
Plan the tax work a year or more ahead. Depreciation recapture, state taxes, and the asset-versus-stock question are decided by how the deal is papered, not by anything you do after signing. A CPA who has closed business sales, working alongside your M&A advisor, will usually save you multiples of their fee.
Finally, decide what happens the day after closing. Buyers pay more for owners with a clear transition plan, whether that is a short handover, a consulting period, or rollover equity in the new company. Sellers who know their answer before going to market keep negotiating leverage from the first meeting to the last.
Questions sellers ask about valuation
How accurate is this calculator?
It gives you an indicative range, not a number you can take to a buyer. A real valuation depends on things a calculator can't see: revenue quality, growth, customer concentration, owner dependence, and what buyers are paying in your sector right now. Use it to orient yourself, then get it reviewed.
SDE or EBITDA: which should I use?
If you're an owner-operator under roughly $1M in earnings, use SDE (and pick the SDE option). If you have a management team and earnings above ~$1-2M, use EBITDA. When in doubt, run both. The truth is usually somewhere in between.
Why is the range so wide?
Because two businesses with identical earnings can sell for very different prices depending on growth, recurring revenue, and risk. The range shows the realistic floor and ceiling for your industry. An advisor narrows it using your actual numbers and live comparables.
How do I get a real, accurate valuation?
Have a specialized M&A advisor who closes deals in your industry review your financials and current comps. Get matched with a vetted firm, including no-retainer options, for a free and confidential indicative valuation as part of the matching process.
Will my buyer use an SBA loan or seller financing to acquire my business?
Many buyers of small and lower-middle-market businesses use SBA 7(a) loans to finance an acquisition — the SBA guarantees up to $5M and loan terms run up to 10 years. Some deals also include a seller note, where you carry part of the purchase price at a negotiated rate. Seller financing often makes your business more acquirable and can push the headline price higher, though it means receiving a portion of proceeds over time rather than all at close. A vetted advisor will walk you through how buyers in your sector fund acquisitions and which deal structure maximizes your net proceeds.
Get a free, advisor-reviewed valuation.
We'll match you with a vetted M&A advisor in your industry who'll give you a confidential, indicative valuation, and tell you honestly what it would take to get there. Free to sellers. No retainer to find out.