Calculator Inputs
Example Data Table
| Scenario | Revenue | EBITDA | EBITDA Multiple | FCF Growth | Discount Rate | Estimated Use |
|---|---|---|---|---|---|---|
| Conservative | 900,000 | 150,000 | 3.5x | 2% | 22% | Risk review |
| Base Case | 1,200,000 | 240,000 | 4.5x | 5% | 18% | Main estimate |
| Growth Case | 1,500,000 | 330,000 | 5.2x | 8% | 16% | Upside discussion |
Formula Used
EBITDA method: Equity Value = EBITDA × EBITDA Multiple + Cash − Debt.
Revenue method: Equity Value = Revenue × Revenue Multiple + Cash − Debt.
SDE method: Equity Value = Seller Discretionary Earnings × SDE Multiple + Cash − Debt.
Asset method: Equity Value = Net Operating Assets + Cash − Debt.
DCF method: Equity Value = Present Value of projected cash flow + Present Value of terminal value + Cash − Debt.
Terminal value: Final Year FCF × (1 + Terminal Growth) ÷ (Discount Rate − Terminal Growth).
Blended value: Sum of each method value multiplied by its normalized method weight.
How to Use This Calculator
- Enter normalized revenue, EBITDA, SDE, and free cash flow.
- Add market multiples that match your industry and business size.
- Enter growth, discount rate, terminal growth, and projection years.
- Add net operating assets, excess cash, and interest bearing debt.
- Set method weights based on which valuation methods are most reliable.
- Press the calculate button to view the result above the form.
- Download the CSV or PDF report for review and recordkeeping.
Business Valuation Overview
A business value is not one fixed number. It is a supported estimate. Buyers, owners, lenders, and partners study value from several angles. This calculator combines market, income, and asset views. It helps you compare the same company under different assumptions. It also shows how much each method affects the final answer.
Why Multiple Methods Matter
Small companies often have uneven earnings. A single formula can overstate or understate value. Revenue multiples work well when profit is developing. EBITDA multiples focus on operating earnings before financing and tax choices. Seller discretionary earnings can help owner operated firms. Discounted cash flow looks forward and values expected cash generation. Asset value gives a floor when tangible resources matter.
Using Assumptions Carefully
Every input should match the business model. Use normalized revenue and earnings. Remove one time gains, unusual costs, and personal expenses when needed. Select multiples from comparable companies, broker reports, or industry transactions. Higher growth can increase value. Higher discount rates reduce value because future cash becomes riskier. Debt lowers equity value. Cash usually increases equity value.
Reading the Result
The blended valuation is a weighted estimate. You can place more weight on the method you trust most. For a stable profitable company, EBITDA and cash flow may deserve higher weights. For a young company, revenue and growth assumptions may matter more. For a company with heavy equipment or property, asset value may be important. The low and high range adds a practical negotiation band.
Practical Finance Use
This tool is useful before selling, buying, fundraising, succession planning, or annual review. It does not replace professional advice. It gives a structured starting point. Save the report as a PDF for discussion. Download the CSV to audit the numbers. Then test several scenarios. Change growth, margins, multiples, debt, and method weights. A strong valuation process explains assumptions clearly. It also shows the sensitivity of value to risk and performance. Keep records behind each estimate. Bank statements, tax returns, payroll reports, customer concentration, contracts, inventory lists, and forecast notes all support stronger analysis. Review seasonality as well. If one customer creates most sales, use a higher risk view. If recurring revenue is proven, a stronger multiple may be reasonable too.
FAQs
What is a business valuation?
It is an estimate of what a company may be worth. It uses earnings, assets, cash flow, market multiples, and risk assumptions.
Which valuation method should I trust most?
Use the method that best matches the company. Stable profitable firms often use EBITDA and DCF. Asset heavy firms may need asset value.
Can this calculator value a startup?
Yes, but startup results are sensitive. Use revenue multiples, growth assumptions, and high discount rates carefully. Review several scenarios.
Why does debt reduce business value?
Debt is usually paid or assumed by the buyer. Subtracting debt helps estimate the equity value available to owners.
What is discounted cash flow?
Discounted cash flow estimates value from future cash. Each future amount is reduced by a discount rate that reflects risk.
What multiples should I enter?
Use multiples from similar businesses, industry reports, broker data, or recent transactions. Avoid using large public company multiples blindly.
Is this a formal appraisal?
No. It is an educational planning tool. For legal, tax, lending, or transaction use, consult a qualified valuation professional.
How do I save the result?
Use the CSV button for spreadsheet review. Use the PDF button for a printable summary that includes the calculated report.