Business Valuation Calculator

Get a Free Estimated Value Range for Your Business

Enter a few key financial details and receive a preliminary value estimate in minutes. This is not a formal appraisal. It's a starting point based on market valuation methods and recent business sales. After your estimate, one of our experienced business brokers can review your company, identify hidden value drivers, and often uncover opportunities to increase your selling price before going to market.

  1. 1. Financial information. Your last 2 full years of financials, plus year-to-date for the current year.
  2. 2. Business profile. Industry, size, growth trend, and the strengths and risks that shape your multiple.
  3. 3. Get your results. Enter your contact info and see your estimated value range instantly, right on this page.

Step 1 — Financial Information

Enter your last 2 full years of financial information plus year-to-date for the current year. Fill in as many or as few years as you have — whole dollars, no commas needed, leave a year blank if you don't have it.

2024 2025 2026 YTD (Jan–Aug)
Annual Revenue (Sales)
Growing 5%+ Stable – Same Decrease 5%+
Cost of Goods Sold
Operating Expenses
Owner Salary / Compensation (add-back)
Depreciation & Amortization (add-back)
Interest Expense (add-back)
One-Time / Non-Recurring Expenses (add-back)
Other Personal / Non-Business Expenses (add-back)
Seller's Discretionary Earnings (SDE) $0 $0 $0
Weighted Seller's Discretionary Earnings (SDE) $0

Step 2 — Business Profile

Business Type — select industry

Employees

Competitive Advantages (check all that apply)

Risk Factors (check all that apply)

Step 3 — Get Your Results

We'll email your results summary to our team so we can follow up if you'd like a more precise, broker-prepared valuation. We won't share your information.

Timeframe to Sell

How This Estimate Works

This calculator provides a preliminary value range using commonly accepted business valuation methodologies, current market transaction data, earnings multiples, and key business characteristics.

Every business is unique. Factors such as customer quality, management depth, growth potential, recurring revenue, industry trends, and operational efficiencies can significantly increase value.

Your estimate is only the first step. After reviewing your results, one of our experienced business brokers can provide a complimentary consultation to refine the valuation, identify opportunities to maximize value, and explain what buyers are currently paying for businesses like yours.

There is no cost and no obligation.

Seller's Discretionary Earnings (SDE)

Most small businesses (typically under $5 million in revenue) are valued as a multiple of Seller's Discretionary Earnings, not revenue or EBITDA alone. SDE starts with your business's Net Income, then adds back the owner's salary, depreciation and amortization, interest expense, and any one-time or personal expenses run through the business. We calculate SDE for each of your last 3 years and weight the most recent year most heavily, since recent performance is the best predictor of what a buyer will pay.

Multiple of Earnings

Once weighted SDE is established, we apply a multiple — a range typically between 1.5x and 5x depending on industry, size, growth, risk, and how dependent the business is on the current owner. Businesses with recurring revenue, documented processes, a management team in place, and a diversified customer base command the higher end of the range. Businesses that are owner-dependent, concentrated in a few customers, or in a declining market fall toward the lower end.

Business Valuation by Revenue: What's a Business Worth at Different Sales Levels?

Most owners start with the one number they already know off the top of their head — annual sales — before they've ever pulled together an SDE statement. Revenue alone doesn't set a price; the multiple is applied to Seller's Discretionary Earnings, not sales (see above). Still, it's a useful starting reference point. The table below assumes a typical 15% SDE margin for an owner-operated service or trades business — the kind of business Tangent Brokerage sells most often. Your actual margin could run well above or below that depending on your industry, so treat this as a rough guide, not a valuation.

Annual Sales (Revenue) Illustrative SDE (~15% margin) Typical Multiple Estimated Value Range
$500,000$75,0001.5x – 3.0x$113,000 – $225,000
$600,000$90,0001.5x – 3.0x$135,000 – $270,000
$700,000$105,0001.5x – 3.0x$158,000 – $315,000
$800,000$120,0001.5x – 3.0x$180,000 – $360,000
$900,000$135,0001.5x – 3.0x$203,000 – $405,000
$1,000,000$150,0001.5x – 3.0x$225,000 – $450,000
$1,500,000$225,0002.0x – 3.5x$450,000 – $788,000
$2,000,000$300,0002.0x – 3.5x$600,000 – $1,050,000
$3,000,000$450,0002.0x – 3.5x$900,000 – $1,575,000
$5,000,000$750,0002.5x – 4.5x$1,875,000 – $3,375,000
$10,000,000$1,500,0002.5x – 4.5x$3,750,000 – $6,750,000

These ranges are illustrative only — based on a flat 15% SDE margin assumption and general market multiples, not your actual financials. Enter your real numbers in the calculator above for an estimate specific to your business, see how these factors played out in real deals, or request a free, confidential Broker's Opinion of Value.

Frequently Asked Questions

SDE is your business's Net Income plus the owner's salary, depreciation, amortization, interest, and any one-time or personal expenses added back. It represents the full financial benefit available to one owner-operator and is the standard cash flow measure used to value most small businesses.

Most small businesses sell for between 1.5x and 5x Seller's Discretionary Earnings, depending on industry, size, growth trend, customer concentration, and how dependent the business is on the current owner. Larger, more established businesses with recurring revenue and a management team in place typically command higher multiples.

A single year can be skewed by a one-off good or bad year. Looking at 3 years lets us weight your most recent, most representative performance more heavily while still smoothing out year-to-year swings — the same trend buyers and lenders look for. If you only have 1 or 2 years, that's fine — just leave the other columns blank.

Recurring revenue, long-term customers, documented systems, a strong management team, diversified customers, high profit margins, contracts in place, and a strong online presence all push your value toward the higher end of the range.

A professional Brokers Opinion of Value verifies your financials, normalizes add-backs with documentation, and compares your business against actual closed transactions in your industry and region. This calculator skips verification and comparables in exchange for an instant, free estimate.

For a $500,000-revenue business — a common size for a single-crew trades or service company — value is driven by Seller's Discretionary Earnings, not revenue. At a typical 15% SDE margin (around $75,000) and the 1.5x–3.0x multiple common at this size, that lands around $113,000–$225,000. A business with recurring contracts and clean books can land above that range; one that's entirely dependent on the owner tends to land below it.

$600,000 in annual sales typically produces roughly $90,000 in SDE at a 15% margin. Applying the 1.5x–3.0x multiple range used for smaller, owner-operated businesses puts estimated value around $135,000–$270,000. This is often the size where having a second key employee — someone besides the owner who can run a job or hold a client relationship — starts to matter to buyers.

SDE around $105,000 at a 15% margin, valued at 1.5x–3.0x, lands near $158,000–$315,000. This is a common revenue size for HVAC, plumbing, and roofing companies running one or two crews — buyers at this size look closely at whether the owner is still the one estimating and closing every job.

$800,000 in sales generally puts SDE around $120,000, and at 1.5x–3.0x that's roughly $180,000–$360,000. Manufacturing and distribution businesses at this revenue level often carry thinner margins than service businesses because of cost of goods sold, so the real number can run below this range — get your actual SDE calculated above rather than relying on a revenue rule of thumb.

At $1 million in sales, SDE is typically around $150,000, and the 1.5x–3.0x multiple used at this size puts value in the $225,000–$450,000 range. $1 million in revenue is also where owners more often start fielding unsolicited offers — it's worth getting a real valuation before responding to one.

$2 million in sales typically supports roughly $300,000 in SDE. Businesses at this size often qualify for a somewhat higher multiple — 2.0x–3.5x — because there's more room for a management layer beneath the owner, putting value around $600,000–$1,050,000. This is the revenue level where "is the owner critical to day-to-day operations" starts to swing the multiple more than almost any other single factor.

At $3 million in sales, expect roughly $450,000 in SDE and a 2.0x–3.5x multiple, landing around $900,000–$1,575,000. Construction and manufacturing businesses at this size increasingly get valued against actual closed comparable transactions rather than rules of thumb, since buyers here tend to be more sophisticated — a broker-prepared Broker's Opinion of Value matters more at this size than a calculator estimate.

$5 million in sales typically produces around $750,000 in SDE (often discussed as EBITDA at this size). With multiples of 2.5x–4.5x common for businesses of this scale — assuming documented systems and a management team beyond the owner — estimated value runs roughly $1,875,000–$3,375,000.

At $10 million in sales, cash flow is typically discussed as EBITDA rather than SDE and runs around $1,500,000. Multiples of 2.5x–4.5x are common, putting estimated value around $3,750,000–$6,750,000 — though at this size, private equity and strategic buyers may pay above this range for a business with recurring revenue and a real management team, or below it for one still fully dependent on the founder.

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