Can I use this figure to sell my business?

No. A sale needs a valuation from a credentialled appraiser holding a CVA, ASA or ABV designation, and the tool says so on screen. This calculator uses generic industry multiples and cannot see your customer concentration, contracts, owner dependence or the quality of your earnings, all of which move real prices substantially.

What does the confidence percentage actually measure?

How complete your inputs were, not how accurate the answer is. It starts at 70 and adds points for supplying EBITDA, growth and asset figures. A confidence of 90 means you filled in most fields, not that the valuation is 90% likely to be right, and reading it as statistical confidence would be a mistake.

Where do the industry multiples come from?

They are fixed constants inside the tool, one revenue multiple and one EBITDA multiple per sector, and you cannot change them. Real transaction multiples vary widely by size, geography, growth and timing, so treat these as a starting point rather than market evidence.

Why is the discounted cash flow number so much higher than the others?

Because the model applies a ten times terminal multiple to year five EBITDA and discounts everything at twelve percent. Terminal value dominates the result, which is true of most discounted cash flow models and is exactly why the tool weights it at only twenty percent.

What if my business is losing money?

Enter a negative EBITDA and the tool will flag it as a weakness, but the arithmetic will still produce a figure. For an unprofitable business the asset-based method is usually the more honest anchor, and a professional would look at liquidation value rather than earnings multiples.

Does the valuation include the value of my own labour?

Not explicitly. If you pay yourself below market rate, EBITDA is overstated and so is the valuation. Buyers normalise owner compensation to a market salary before applying a multiple, and you should adjust your EBITDA input the same way.

Why is the range exactly plus or minus twenty percent?

It is a fixed band applied to the weighted figure rather than anything derived from your data. It is there as a reminder that a point estimate is false precision, not as a calculated confidence interval.

Business Valuation Calculator: Four Methods Compared

Business Valuation Calculator: Four Methods ComparedThe Business Valuation Calculator is a free browser-based tool that estimates a business value four different ways and blends them into a single weighted figure with a range around it. It applies an industry revenue multiple, an industry EBITDA multiple, an asset-based value with a going-concern premium, and a simplified five-year discounted cash flow, then weights them according to whether you supplied EBITDA. The industry multiples and the twelve percent discount rate are fixed inside the tool. This is a screening estimate for orientation, not an appraisal, and no certified appraiser would sign their name to a number produced this way.

What people use it for

Getting oriented before approaching a broker

An owner considering selling in two years wants a rough sense of scale before paying for professional advice. Running revenue, EBITDA, growth and net assets through the tool produces a range wide enough to be honest and specific enough to answer whether a sale would fund retirement or not.

Understanding why buyers value EBITDA so heavily

Entering a business with strong revenue but zero EBITDA and watching the recommended figure collapse is instructive. The discounted cash flow method depends entirely on EBITDA, so a business with no reported earnings loses two of the four methods at once and falls back on revenue and assets.

Testing what growth is worth

The growth rate adjusts both multiples and drives the cash flow projection. Running the same business at zero and at fifteen percent growth shows how much of a valuation is really a bet on the trajectory rather than the current earnings, which is a useful reality check before negotiating.

Preparing questions for a professional valuation

Arriving at an appraiser with four method-level numbers and knowing which one is driving the result makes for a much sharper conversation. The tool output is not evidence, but it does tell you which assumptions to interrogate.

How it works

Enter annual revenue and EBITDA Revenue drives the revenue multiple. EBITDA drives both the earnings multiple and the cash flow projection, and leaving it at zero materially changes how the final figure is weighted.
Choose your industry The dropdown covers ten sectors, from SaaS and technology through retail, restaurants, construction and professional services. Each carries its own built-in revenue and EBITDA multiples that you cannot edit.
Enter your annual growth rate Growth adjusts both multiples at half weighting, so ten percent growth lifts them by five percent, and it compounds the projected cash flows across the five-year projection.
Add total assets and total liabilities These feed the asset-based method. Net assets are calculated as assets minus liabilities and then increased by a twenty percent going-concern premium before entering the weighted average.
Press Calculate and read all four methods The recommended valuation and its range appear first, followed by each method separately. When the four numbers disagree sharply, the blended figure is far less meaningful than the spread.

Worked examples

Input: Revenue $800,000, EBITDA $160,000, industry Professional Services, growth 10%, assets $300,000, liabilities $120,000.

Result: Revenue multiple $1,260,000 at 1.58x, EBITDA multiple $1,176,000 at 7.35x, asset-based $216,000, discounted cash flow about $2.22 million. Recommended about $1,209,661 with a range of roughly $967,729 to $1,451,593, confidence 90%.

Input: Revenue $300,000, EBITDA $0, industry Retail, growth 0%, assets $90,000, liabilities $40,000.

Result: Revenue multiple $150,000 at 0.50x, EBITDA multiple $0, asset-based $60,000, discounted cash flow $0. Recommended $72,000 with a range of $57,600 to $86,400, confidence 75%. With no EBITDA the cash flow method contributes nothing at all.

Frequently asked questions

Can I use this figure to sell my business?: No. A sale needs a valuation from a credentialled appraiser holding a CVA, ASA or ABV designation, and the tool says so on screen. This calculator uses generic industry multiples and cannot see your customer concentration, contracts, owner dependence or the quality of your earnings, all of which move real prices substantially.
What does the confidence percentage actually measure?: How complete your inputs were, not how accurate the answer is. It starts at 70 and adds points for supplying EBITDA, growth and asset figures. A confidence of 90 means you filled in most fields, not that the valuation is 90% likely to be right, and reading it as statistical confidence would be a mistake.
Where do the industry multiples come from?: They are fixed constants inside the tool, one revenue multiple and one EBITDA multiple per sector, and you cannot change them. Real transaction multiples vary widely by size, geography, growth and timing, so treat these as a starting point rather than market evidence.
Why is the discounted cash flow number so much higher than the others?: Because the model applies a ten times terminal multiple to year five EBITDA and discounts everything at twelve percent. Terminal value dominates the result, which is true of most discounted cash flow models and is exactly why the tool weights it at only twenty percent.
What if my business is losing money?: Enter a negative EBITDA and the tool will flag it as a weakness, but the arithmetic will still produce a figure. For an unprofitable business the asset-based method is usually the more honest anchor, and a professional would look at liquidation value rather than earnings multiples.
Does the valuation include the value of my own labour?: Not explicitly. If you pay yourself below market rate, EBITDA is overstated and so is the valuation. Buyers normalise owner compensation to a market salary before applying a multiple, and you should adjust your EBITDA input the same way.
Why is the range exactly plus or minus twenty percent?: It is a fixed band applied to the weighted figure rather than anything derived from your data. It is there as a reminder that a point estimate is false precision, not as a calculated confidence interval.

Tips

Normalise your EBITDA before entering it. Add back genuinely one-off costs and adjust owner pay to a market salary, which is the first thing a buyer will do.
Pay more attention to the spread between the four methods than to the blended figure. A wide spread means the business is hard to value, which is itself useful information.
Rerun with a conservative growth rate. Growth feeds both the multiples and the cash flow projection, so optimism there compounds through the whole result.
Treat the output as a question rather than an answer, and take it to an appraiser or broker as the starting point of a conversation.

Written by Ahsan Mahmood. Last updated 2026-07-21. This calculator runs entirely in your browser and produces estimates, not tax advice.TaxEase — Business Valuation Calculator: Four Methods Compared