Get a quick ballpark valuation using the two most common shortcut methods — a revenue multiple and an earnings (EBITDA) multiple.
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Enter your financials, then click Calculate to see results.
| Method | Metric | Multiple | Valuation |
|---|
| Sector | Revenue Multiple | EBITDA Multiple |
|---|---|---|
| SaaS | 4x - 8x | 10x - 20x |
| Retail / E-commerce | 0.5x - 1.5x | 3x - 5x |
| Professional Services | 0.8x - 1.5x | 3x - 6x |
| Manufacturing | 0.5x - 1x | 4x - 6x |
These ranges are illustrative only — actual multiples depend heavily on growth rate, margins, customer concentration, and prevailing market conditions.
This business valuation calculator gives you a fast, ballpark estimate of what a business might be worth, using the two shortcut methods valuation practitioners typically reach for first: a revenue multiple and an EBITDA (earnings) multiple. Enter your annual revenue and EBITDA alongside a multiple for each, add total debt and cash on hand, and the calculator returns a revenue-based value, an earnings-based value, a blended enterprise value estimate, and an equity value after net debt — all in seconds.
Business valuation matters at almost every major inflection point in a company's life: an owner exploring a sale wants to know whether an offer is fair, a buyer sizing up an acquisition target wants a sanity check before diligence begins, a founder raising a funding round needs a defensible starting number for negotiations, and an advisor handling an estate or a partner buyout needs a documented, reasoned figure to work from. A quick multiple-based estimate won't replace a certified appraisal for any of these situations, but it gives everyone in the conversation a shared, informed starting point instead of a guess.
This tool suits small business owners weighing whether now is the right time to sell, buyers screening several acquisition targets before committing time to formal diligence, founders and investors sanity-checking a funding round's implied valuation, brokers and M&A advisors preparing an initial range for a client conversation, and accountants or attorneys who need a quick reference figure for an estate, divorce, or partner buyout discussion before commissioning a full appraisal.
Multiple-based valuation multiplies a financial metric by a market-typical multiple
Best for early-stage or fast-growing companies without stable profits yet — a top-line proxy for future earning power.
Best once a business has consistent, positive earnings — captures profitability and cost structure, not just size.
Enterprise value belongs to both debt and equity holders — subtracting net debt converts it into the value available to owners.
From financial figures to a blended valuation estimate in under a minute
Input your trailing twelve-month revenue and a revenue multiple appropriate to your industry and growth rate.
Input your trailing twelve-month EBITDA, normalized for one-time or owner-specific add-backs, and an EBITDA multiple typical for your sector.
Input total outstanding debt and cash on hand so the calculator can compute net debt and convert enterprise value into equity value.
The calculator multiplies each metric by its multiple, averages the two results into a blended estimate, and subtracts net debt to produce an equity value.
Check how the revenue-based and earnings-based values compare to each other, and see how your multiples stack up against typical sector ranges.
Download a plain-text summary of your result, or adjust your multiples and recalculate to model a different scenario.
A realistic small-business valuation calculation, step by step
Suppose a small business reports $800,000 in annual revenue, and its industry typically trades at a 1.5x revenue multiple. The same business reports $200,000 in annual EBITDA, with a typical EBITDA multiple of 4x for its sector. The business carries $50,000 in total debt and holds $20,000 in cash.
Explanation: The revenue-based value ($1,200,000) and the earnings-based value ($800,000) sit $400,000 apart — a 40% spread relative to the $1,000,000 blended estimate, which is a fairly wide gap between the two methods. That's not unusual: the revenue multiple and EBITDA multiple were chosen independently and can disagree, especially if the business's margins are unusually thin or rich for its industry. Averaging the two smooths the estimate rather than betting everything on one metric, and the $970,000 equity value shows how the modest debt load ($50,000 versus $20,000 in cash) barely dents the blended figure once net debt is subtracted.
Sensitivity check: if this business improved its margins so EBITDA rose to $300,000 with the same 4.0x multiple, the earnings-based value would climb to $1,200,000 — matching the revenue-based value exactly, tightening the spread to 0% and pushing the blended estimate up to $1,200,000, all else equal. This illustrates how sensitive the blended figure is to EBITDA in particular, since profitability improvements flow straight through the earnings-based side of the calculation.
How typical multiples vary by sector, and what the spread between methods tells you
Two numbers matter most when reading your results: how your chosen multiples compare to typical sector ranges, and how far apart your revenue-based and earnings-based values land from each other. These are general reference ranges, not a formal industry standard.
| Sector | Typical Revenue Multiple | Typical EBITDA Multiple | What Pushes the Range Higher |
|---|---|---|---|
| SaaS / Subscription | 4x – 8x | 10x – 20x | Recurring revenue, high gross margins, low churn, strong growth |
| Professional Services | 0.8x – 1.5x | 3x – 6x | Recurring client contracts, low owner dependency, documented processes |
| Manufacturing | 0.5x – 1x | 4x – 6x | Diversified customer base, modern equipment, defensible niche |
| Retail / E-commerce | 0.5x – 1.5x | 3x – 5x | Brand loyalty, proprietary products, strong repeat-purchase rate |
For the method spread: when the revenue-based and earnings-based values sit close together, that's a mild signal of consistency — two independent methods pointing at roughly the same number. A wide spread, like the 40% gap in the worked example above, usually means the business's margin profile is unusually thin or rich relative to the multiples chosen, or that one of the two multiples doesn't really fit this specific business — worth a second look before treating the blended figure as reliable.
For equity value: a small equity value relative to the blended enterprise value estimate signals a heavily leveraged business — most of its value is spoken for by debt before an owner sees a cent. A business with little or no debt and healthy cash reserves will see equity value land close to, or even above, the blended estimate.
Risk considerations: this model doesn't know about customer concentration, contract terms, growth trajectory, or anything qualitative about the business beyond the numbers entered. Treat the result as a planning estimate to stress-test, not a guarantee of what a buyer would actually pay.
This calculator provides estimates for educational and informational purposes only. Results may vary depending on business conditions, accounting methods, taxes, market trends, and other factors. It should not be considered financial, legal, tax, accounting, or investment advice. Consult qualified professionals before making business decisions.
Where a quick multiple-based valuation earns its keep
Sanity-check whether an asking price or broker estimate falls in a reasonable range before listing.
Quickly screen a target business before committing time and money to formal due diligence.
Prepare a defensible starting valuation figure before negotiating with investors.
Get a reference figure for passing a business to heirs or a successor.
Provide a starting reference point for asset division discussions involving a business interest.
Estimate a fair equity value when one partner is buying out another's ownership stake.
Get a rough figure to discuss with a lender considering the business as collateral.
Compare a franchise location's asking price against typical multiples for the sector.
Advisors can quickly range-check several client businesses before deeper engagement.
Get a ballpark business value to inform key-person or buy-sell insurance coverage discussions.
Get an early reference figure before exploring an employee stock ownership plan transition.
Founders can benchmark a potential exit value against revenue and earnings multiples.
What this business valuation calculator does well, and where it can't replace a certified appraisal
Three common approaches to estimating what a business is worth
| Feature | Revenue Multiple | EBITDA Multiple | Asset-Based |
|---|---|---|---|
| What it measures | Top-line size as a proxy for future value | Profitability and cost structure | Net value of tangible and intangible assets |
| Best for | Early-stage or fast-growing, not-yet-profitable businesses | Established businesses with stable, positive earnings | Asset-heavy businesses or liquidation scenarios |
| Ignores profitability? | Yes — can overvalue a low-margin business | No — directly reflects margin and cost structure | Yes — doesn't reflect earning power at all |
| Common use case | SaaS and startup valuations pre-profitability | Small business and M&A transactions | Real estate-heavy, holding companies, distressed sales |
| Data required | Annual revenue and a market multiple | Normalized annual EBITDA and a market multiple | Full balance sheet with asset and liability values |
| Computed by this calculator? | Yes | Yes | No — use a balance sheet or accountant for this method |
This calculator blends the revenue multiple and EBITDA multiple approaches, which cover most small business and lower-middle-market valuation conversations. Asset-based valuation is a different lens entirely — most useful for asset-heavy businesses, real estate holding companies, or a liquidation scenario where earning power matters less than the value of what the business physically owns — and isn't something a revenue or earnings multiple can substitute for.
Common questions about business valuation
Official guidance to complement this calculator — not a substitute for a licensed business valuation professional
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