06/25/2026
Want to know what your business is worth? Start with this formula:
Earnings × Multiple = Estimated Value
But here's what most owners miss — the multiple isn't fixed. It moves based on how risky or attractive your business looks to a buyer.
Strong margins, recurring revenue, clean books, and a capable team push the multiple up. Owner dependency, customer concentration, and inconsistent financials push it down.
Two businesses with the same earnings can sell for very different prices depending on those factors.
If you're planning to sell, understanding your multiple is just as important as knowing your earnings.