How to Use the Valuation Multiple
How much is your business actually worth? This calculator estimates enterprise value using industry-standard EBITDA or revenue multiples. Enter your financials, pick your multiple, and see what buyers or investors might pay — or flip it to determine how much EBITDA you need to hit a specific valuation target.
Step-by-Step Guide
- 1
Select EBITDA or Revenue as your valuation metric.
- 2
Enter your latest full-year EBITDA or Annual Revenue.
- 3
Enter the Industry Multiple (typically 3–10x, depending on industry, growth, and market conditions).
- 4
The calculator shows your estimated Enterprise Value.
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Optional: Enter a negative multiple to solve for the EBITDA or revenue needed to reach a target valuation.
Valuation Multiple Formula
Enterprise Value = EBITDA × EBITDA Multiple Enterprise Value = Revenue × Revenue Multiple EBITDA = Target Valuation ÷ EBITDA Multiple Revenue = Target Valuation ÷ Revenue Multiple
Worked Example
EBITDA: $500,000. Multiple: 4x. Revenue: $2,500,000. If using EBITDA: $500,000 × 4 = $2,000,000 EV If using Revenue: $2,500,000 × 4 = $10,000,000 EV (Revenue multiples are typically higher in high-growth SaaS and tech sectors).
Understanding your result
Calculator results depend entirely on the information entered. For the most useful estimate, use current and accurate figures and include all costs that apply to your specific situation.
Frequently Asked Questions
What's a 'good' multiple for my business?
Multiples vary wildly by industry, growth rate, profitability, and market conditions. SaaS businesses often trade at 4–10x revenue, while traditional service businesses might be 2–5x EBITDA, and e-commerce varies widely. Compare against public comps and recent M&A in your space.
How do I find the right multiple for my industry?
Research recent acquisition multiples for similar-sized companies in your industry, check industry survey data, and talk to business brokers or M&A advisors. High-growth, recurring-revenue businesses command premium multiples.
What's the difference between Enterprise Value and Equity Value?
Enterprise Value (EV) represents the total value of the business (Debt + Equity). Equity Value = EV - Debt + Cash. Most multiples calculate Enterprise Value because debt and cash are often assumed to be adjusted at closing.
Should I use EBITDA or Revenue multiple?
Use EBITDA if your business is profitable and EBITDA is a reliable indicator of cash flow. Use Revenue multiple if your business is growing fast but not yet profitable (common in tech/SaaS). Some acquirers use both.
Can I calculate my required valuation if I already know the multiple?
Yes. Just enter the multiple as a negative number (e.g., -4) and the valuation as a positive number in the field that corresponds to the multiple type you're using. The calculator will show the required EBITDA or revenue.