Calculate your business valuation for exit. See revenue multiple and EBITDA multiple by industry. Free business exit calculator.
Most small business owners build companies for years without thinking about exit — then discover their business is worth far less than expected because they never optimized for sale. Understanding business valuation multiples before you need them lets you make strategic decisions that maximize your exit value. Our calculator shows your estimated valuation range and what drives your multiple.
Common valuation multiples for SMB sales 2026: SaaS business: 4-8x annual recurring revenue (ARR) for profitable, 2-4x for growth-stage. E-commerce (Shopify, Amazon): 2-4x annual net profit (seller discretionary earnings). Service business (agency, consulting): 1-3x annual SDE. Physical product business: 2-4x SDE. Restaurant: 0.3-0.5x annual revenue or 2-3x EBITDA. Manufacturing: 3-6x EBITDA.
Factors that command higher multiples: Recurring revenue (subscriptions beat one-time): adds 1-3x to multiple. Owner not essential to operations — businesses that cannot run without the owner sell at steep discount. Documented systems and processes. Diversified customer base — no single customer over 20% of revenue. Strong growth trend. Clean financials 3+ years of tax returns. No single key employee dependency. Transferable customer relationships.
Most common SMB valuation methods: Seller Discretionary Earnings (SDE): add back owner salary, benefits, and one-time expenses to net profit. Apply industry multiple (1-4x SDE for most businesses). EBITDA multiple: used for larger businesses over $1M in earnings. Revenue multiple: used primarily for SaaS. Asset-based: used for asset-heavy businesses or distressed sales. Hire a business broker or M&A advisor for accurate valuation above $500,000.
Start planning 3-5 years before target exit date. Changes that take years: increasing recurring revenue mix, removing owner dependency by hiring and systematizing, cleaning up financials (stop mixing personal and business expenses), building management team, diversifying customer concentration. Businesses sold by owners who planned 3-5 years ahead consistently sell for 2-3x more than those rushed to market.
SDE is the primary valuation metric for small businesses. Formula: Net profit plus owner salary plus owner benefits (health insurance, retirement contributions) plus non-recurring expenses plus personal expenses run through business plus depreciation and amortization. SDE represents total economic benefit to an owner-operator. A business with $200,000 SDE selling at 3x multiple = $600,000 sale price.
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The Business Exit Strategy Calculator — What Is Your Business Worth at Exit? uses the same formulas, rates, and reference data that financial planners, professionals, and government sources publish. Results are estimates intended for planning and education — for situations involving large sums or legal consequences, confirm with a qualified professional before acting.
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