Business Valuation Calculator
Estimate what your business is worth using SDE and EBITDA multiples by industry. Compare valuation methods and discover how to increase your business value before selling.
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How to Use This Calculator
Quick Valuation tab
The default tab. Enter your annual revenue, SDE (Seller's Discretionary Earnings), and select your industry. The calculator applies industry-specific SDE multiples from 2024-2025 transaction data to produce a low, mid, and high valuation range. Expand "More options" to add years in business and growth rate for context.
EBITDA Method tab
Use this for larger businesses with professional management. Enter your annual EBITDA, total debt, and cash on hand. The calculator computes enterprise value (EBITDA × multiple), then subtracts debt and adds cash to show equity value — what you actually receive at closing. Expand "More options" to compare SDE vs EBITDA methods side by side.
Improve Value tab
See exactly how operational improvements affect your valuation. Use the interactive sliders to model margin increases, recurring revenue percentages, and reduced owner hours. Each lever shows its dollar impact on your business value, so you can prioritize improvements before going to market.
Share your result
Every input is encoded in the URL. Click Share to send your exact scenario to a business broker, partner, or advisor.
The Formula
Small business valuation primarily uses two earnings-based methods:
Business Value = SDE × Industry Multiple
SDE = Net Income + Owner Salary + Owner Perks + Depreciation + Interest + One-Time Expenses
EBITDA Method (larger businesses):
Enterprise Value = EBITDA × Industry Multiple
Equity Value = Enterprise Value − Total Debt + Cash
EBITDA = Net Income + Interest + Taxes + Depreciation + Amortization
The key difference: SDE includes owner compensation, so it represents total benefit to one owner-operator. EBITDA does not, so the buyer must pay a manager separately. That's why EBITDA multiples are higher (4-8x) than SDE multiples (2-4x) — they cover different slices of the same earnings.
The median small business sale price is $350,000 at an average SDE multiple of 2.57x (BizBuySell Q4 2025). Revenue multiples average 0.67x across all industries.
Example
Jennifer — owns a dental practice in Phoenix, AZ
Jennifer has owned her dental practice for 12 years. She has 3 hygienists, 2 assistants, and a front-desk manager. Annual revenue: $1.2M. She pays herself $180K salary. After adding back her salary, one-time equipment purchases, and personal expenses run through the business, her SDE is $320K. The practice has $80K in equipment loans and $45K cash.
Quick Valuation tab (SDE method)
EBITDA Method tab
The SDE method values the practice higher because Jennifer is the primary producer. A buyer who will also work as a dentist gets the full SDE benefit. The EBITDA method is lower because it assumes the buyer hires a replacement dentist — reducing available earnings.
Improve Value tab
By launching a dental membership plan, improving hygiene production margins, and training an associate dentist, Jennifer could increase her practice value by $449,000 — a 37% increase — over 18-24 months before listing.