Business Valuation Calculator
Estimate enterprise value, equity value and an ownership stake with an earnings, revenue or net-assets method.
Business valuation formulas
This calculator produces separate indications of value. It does not average different methods because EBITDA, seller’s discretionary earnings, revenue and net assets measure different economic bases.
Equity value = enterprise value + excess cash − interest-bearing debt
Net-asset value = fair market value of assets − liabilities
Ownership value = equity or net-asset value × ownership percentage
Which valuation method should you choose?
- EBITDA multiple: useful when EBITDA is a meaningful measure of operating performance and comparable transaction or market multiples are available.
- SDE multiple: often used for owner-operated businesses; enter normalized seller’s discretionary earnings and a defensible market multiple.
- Revenue multiple: useful only when revenue multiples are common for genuinely comparable businesses with similar growth and margins.
- Net assets: subtracts liabilities from the fair market value of assets and can be informative for asset-heavy or liquidation-oriented situations.
Checked examples
With normalized EBITDA of $500,000 and multiples of 3.0×, 4.0× and 5.0×, enterprise value ranges from $1.5 million to $2.5 million. Adding $100,000 of excess cash and deducting $250,000 of debt gives a selected equity value of $1.85 million at 4.0×. A separate net-assets example with $1.6 million of assets and $700,000 of liabilities gives $900,000; a 60% pro rata interest is $540,000.
How to choose a multiple
The calculator does not supply an industry multiple. Use recent transactions or market evidence for businesses with similar size, margins, growth, customer concentration, recurring revenue, geography and risk. The multiple must be consistent with the metric: an EBITDA multiple should not be applied to revenue or SDE.
Important limits
No single general formula can value every private business. A defensible valuation considers financial history, industry outlook, earnings stability, assets, goodwill, comparable interests, control, marketability and the valuation date. This calculator does not estimate taxes, working-capital adjustments, contingent liabilities, non-operating assets other than entered cash, control premiums, minority discounts, marketability discounts or buyer-specific synergies. It is an educational scenario tool, not an appraisal, fairness opinion, tax valuation or offer price.
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