Business Valuation Calculator
Triangulate what your business is worth three ways — earnings multiple, revenue multiple, and asset value — and get a defensible range instead of a false single number.
Written by Dorothy Ibrahim, 10+ years in banking & finance
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How we calculate this
This calculator triangulates what your business might sell for three ways — an earnings multiple (SDE or EBITDA), a revenue multiple, and net asset value — and blends them into a defensible range instead of a false single number. The spread between the low and high ends is real: small-business sale prices vary widely with add-backs, books quality, and buyer type. Use the range to set expectations before you talk to a broker, not as an appraisal.
The formulas
- Earnings-multiple value
- earnings × industry multiple range (SDE 1.5–3.5×, small-business EBITDA 3–5×, mid-market EBITDA 4–7×)If earnings are zero or negative, this method does not apply and the tool falls back to asset value only.
- Revenue-multiple value
- annual revenue × 0.5 to 2.0×Revenue multiples apply mainly to high-growth or recurring-revenue models.
- Asset-based value
- tangible asset value − liabilities
- Blended valuation range
- (weight × earnings value) + (weight × revenue value) + (weight × asset value), computed at the low and high end of each rangeDefault weights are 60% earnings / 20% revenue / 20% asset; the weights are normalized to sum to 1.
- Midpoint
- (blended low + blended high) ÷ 2
Worked example
- Say annual revenue is $800,000, earnings (SDE) are $180,000, tangible assets are $120,000, and liabilities are $40,000, with the default 60/20/20 weights.
- Earnings-multiple value at SDE multiples of 1.5–3.5×: $180,000 × 1.5 = $270,000 low; $180,000 × 3.5 = $630,000 high.
- Revenue-multiple value at 0.5–2.0×: $800,000 × 0.5 = $400,000 low; $800,000 × 2.0 = $1,600,000 high.
- Asset-based value = $120,000 − $40,000 = $80,000.
- Blended low = 0.6 × $270,000 + 0.2 × $400,000 + 0.2 × $80,000 = $258,000; blended high = 0.6 × $630,000 + 0.2 × $1,600,000 + 0.2 × $80,000 = $714,000.
- The estimated range is $258,000–$714,000, with a midpoint of $486,000 — the wide spread reflects genuine uncertainty in small-business pricing.
Rates, benchmarks & sources
- Multiple ranges: SDE 1.5–3.5× (Main Street), EBITDA 3–5× (small business), EBITDA 4–7× (mid-market), revenue 0.5–2.0×. Wide ranges by design — add-backs and comparability drive real value. — BizBuySell / DealStats / First Page Sage / Peak transaction aggregators (rule-of-thumb ranges)
- Default method weights of 60% earnings / 20% revenue / 20% asset reflect that most small businesses sell on an earnings multiple; the weights are editable. — Weighting convention (rule of thumb)
Figures current as of 2026-07-02. See our methodology & editorial standards for how constants are versioned and verified.
What this tool doesn’t model
- This is an estimate range from broker-survey multiples, not an appraisal — a real sale requires a professional valuation and market testing by a broker or M&A advisor.
- Industry, growth rate, customer concentration, and owner dependence move a business within (or outside) these ranges; the tool does not model those factors.
- Uses a single earnings figure — it does not verify your SDE or EBITDA math. Build that number in the SDE or EBITDA calculator first.
- Asset values are taken at the number you enter; a buyer will use appraised fair market value, which can differ from book value.
Frequently asked questions
Why does the calculator give a range instead of one number?
Because a single number would be false precision. Small-business sale multiples from transaction aggregators span wide ranges — 1.5–3.5× SDE for Main Street businesses — and where you land depends on books quality, defensible add-backs, growth, and buyer type. A range tells you what is realistic; a point estimate only tells you what someone hoped.
Should I use SDE or EBITDA as my earnings basis?
Owner-operated businesses under roughly $1–2M in earnings typically trade on SDE, which adds back the owner’s full salary because the buyer replaces the owner. Larger, manager-run companies trade on EBITDA, which adds back only compensation above a market-rate manager. Pick the basis that matches how a buyer would run your business, and never apply an EBITDA multiple to an SDE number — it overstates value.
Is this an appraisal I can use for a sale, loan, or divorce?
No. The multiple ranges here are heuristics from transaction aggregators and broker surveys, useful for setting expectations. Any real transaction — a sale, SBA loan, buy-sell agreement, or legal proceeding — requires a professional valuation from a credentialed appraiser or an M&A advisor who can test your business against actual comparable sales.
What does it mean that the asset value sets a floor?
If your net tangible assets are worth more than the low end of your earnings-based value, a rational seller would liquidate rather than accept less than the assets are worth. For asset-heavy businesses — equipment-intensive trades, real-estate-holding operations — the asset value is the practical minimum price, which is why the tool flags it.
What happens if my business is not profitable?
With zero or negative earnings, an earnings multiple has nothing to multiply, so the tool values the business at net assets only (tangible assets minus liabilities). Buyers of unprofitable businesses pay for assets, customer lists, or a turnaround thesis — not for earnings that do not exist — and professional guidance matters even more in that situation.
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themoneysheet provides educational estimates, not financial, tax, or legal advice. Figures use published rates and formulas current as of the date shown, but your situation may differ. Consult a qualified professional (CPA, attorney, or licensed advisor) before making financial decisions.