Free Business Valuation Calculator
Enter your earnings and your industry for an approximate, size- and industry-adjusted valuation range — based on how small businesses actually trade.
Build your SDE
Not sure of your owner earnings? Add up the pieces below and we’ll drop the total into the calculator. Already know it? Skip to the calculator ↓
Seller’s Discretionary Earnings — the earnings figure small-business buyers actually price against.
For most small businesses, value comes down to one thing: how much money the business puts in the owner’s pocket each year, multiplied by what buyers currently pay for that kind of earnings. The calculator above does exactly that — but the number is only as good as the earnings figure you feed it, so it’s worth understanding both halves.
A profitable small business in the United States typically sells for somewhere between 1.5x and 3.5x its annual owner earnings (SDE) — smaller businesses at the low end, larger ones higher. A business earning $250,000 a year for its owner is usually worth roughly $600,000 to $875,000; a smaller shop earning $75,000 often lands closer to $110,000–$170,000. Where you fall is driven mostly by your size, then your industry and the quality of the business underneath the earnings.
It runs the same two-step logic a real buyer or broker uses. Step one is your owner earnings (SDE) — net profit, plus the salary you pay yourself, plus the personal expenses that legitimately run through the business, plus non-cash items like depreciation and interest. That’s the single most important number in a small-business valuation, and the builder above walks you through it. Step two is an industry- and size-adjusted multiple — buyers pay a multiple of SDE, and it isn’t the same for everyone. A recurring-revenue accounting firm commands more than a restaurant; a business doing $1M in SDE earns a higher multiple than one doing $75K. The calculator returns a low, midpoint, and high figure rather than one false-precision number.
SDE — Seller’s Discretionary Earnings — is your business’s profit with the owner’s benefits added back in. Start with pre-tax net profit and add back your own compensation, the personal expenses run through the business (vehicle, phone, travel, meals, family on payroll), and non-cash and financing items like depreciation, amortization, and interest. Together that shows a buyer the full economic benefit of owning the business, not just the taxable profit after you’ve paid yourself.
SDE vs EBITDA: they’re cousins. EBITDA doesn’t add back an owner’s salary, so it’s used for larger businesses that already pay a market-rate manager. SDE adds one owner’s compensation back and is the standard for owner-operated small businesses — which is why this calculator uses it.
Here’s the SDE multiple range by industry, spanning a small owner-operated business (~$75K SDE) up to a strong, established one (~$250K SDE). Recurring-revenue and licensed, essential-service businesses (accounting, insurance, medical, the trades) hold their value best; discretionary, thin-margin, and hospitality businesses (restaurants, retail, gyms) run lower. Notice how much the low end matters — a smaller business in almost any industry lands in the 1x range. Larger businesses run higher than the top of these ranges.
| Industry | Typical SDE multiple * |
|---|---|
| Law firm | 2.0–3.4× |
| Insurance agency | 2.0–3.4× |
| Medical practice | 2.0–3.4× |
| Accounting / bookkeeping | 2.0–3.3× |
| Physical therapy / chiropractic | 2.0–3.3× |
| Convenience / liquor store | 2.0–3.3× |
| Grocery / specialty food | 2.0–3.3× |
| Auto repair shop | 2.0–3.3× |
| Car wash | 2.0–3.3× |
| Consulting firm | 1.8–3.3× |
| Landscaping / lawn care | 1.8–3.3× |
| Cleaning / janitorial | 1.8–3.3× |
| Pest control | 1.8–3.3× |
| E-commerce / online retail | 1.8–3.3× |
| IT services / managed services | 1.7–3.2× |
| Dental practice | 1.7–3.2× |
| Veterinary clinic | 1.7–3.2× |
| Daycare / childcare | 1.7–3.2× |
| HVAC / plumbing | 1.7–3.2× |
| Electrical contractor | 1.7–3.2× |
| Roofing / exterior | 1.7–3.2× |
| Salon / spa / barber | 1.7–3.2× |
| Distribution / wholesale | 1.7–3.2× |
| Manufacturing / fabrication | 1.5–3.2× |
| Marketing / advertising agency | 1.5–3.1× |
| Architecture / engineering | 1.4–3.0× |
| Restaurant / café | 1.4–3.0× |
| Bar / nightlife | 1.4–3.0× |
| Specialty retail shop | 1.4–3.0× |
| Gym / fitness / yoga | 1.4–3.0× |
* Approximate. The low end reflects a small owner-operated business (~$75K SDE); the high end a strong, established one at ~$250K SDE. Larger businesses run higher still. These describe profitable operators, not every business in the industry.
The same business can carry a very different multiple depending on how much it earns. Larger earnings are steadier, easier to finance, and attract more buyers — so each dollar of SDE is worth more. Holding the industry constant, one business earns a higher multiple as it grows:
| Annual SDE — same business, as it grows | Typical multiple * |
|---|---|
| ~$75K — very small | ~2.0× |
| ~$250K — established | ~2.8× |
| ~$750K+ — larger (lower-middle-market) | ~3.4×+ |
* Illustrative, for one representative business as it scales, with industry and quality held constant. Lower-tier industries (restaurants, gyms, retail) run below this — and when very small, into the low 1x’s; higher-tier professional and essential-service firms run above.
This is why a revenue rule of thumb, or a flat “2x earnings,” gets small businesses wrong so often — and why your exact multiple is specific to your size. For the full method behind the numbers, see our small business valuation guide.
$300,000 SDE × 2.5–3.3× (dental, at this size) = $750,000 – $990,000, midpoint ≈ $870,000.
A single-location practice with steady hygiene recall and an associate-supported schedule lands mid-to-upper range. Heavy owner-dependence — where the practice is the dentist — pulls it toward the low end.
$250,000 SDE × 2.4–3.2× = $600,000 – $800,000, midpoint ≈ $700,000.
Recurring maintenance contracts and a trained crew that runs calls without the owner push toward the top. A shop where the owner is still the lead tech sits lower.
No calculator can hand you a single exact figure, and any that claims to is guessing. Two businesses with identical earnings can be worth 40% apart because of things a formula never sees: how much the business depends on you personally, whether revenue recurs or has to be re-won every month, customer concentration, growth trend, and how clean and provable the books are. A business that runs without its owner is worth far more than one that can’t. Those factors are the difference between the low end and the high end — and they’re exactly what the Honest Assessment measures, before handing you the ranked list of moves that raise your number. It also shows you whether your business is actually a good investment — how your return as an owner compares to what your time and money could earn elsewhere.
The full assessment finds where in this range you actually land, benchmarks you against profitable operators in your industry, and hands you the single highest-impact move to raise it. From $197/mo — full report plus Vera, your coach. Cancel anytime.
Get My Assessment → or see a sample report first, no account required →Most profitable small businesses are worth about 1.5x to 3.5x their annual owner earnings (SDE), with size the biggest factor — smaller businesses sit lower, often in the 1x range. Enter your SDE and industry in the calculator above for an approximate, size-adjusted range. The exact figure also depends on your growth, owner-dependence, and how clean your books are.
Small businesses are valued on earnings, not revenue. Two businesses with the same sales can be worth very different amounts depending on how much profit reaches the owner. A revenue-only rule of thumb almost always misprices an owner-operated business — use owner earnings (SDE) instead.
Calculate your SDE (net profit + your salary + personal expenses run through the business + depreciation + interest), then multiply by the going SDE multiple for your industry and size. The calculator above does both steps for you and returns a low-to-high range.
SDE is your business’s pre-tax profit with the owner’s benefits added back — your salary, personal expenses run through the business, and non-cash items like depreciation and interest. It represents the total financial benefit of owning the business for one owner-operator, and it’s the standard earnings figure used to value small businesses.
For the full picture of how that multiple is chosen and where other methods fit, see our guide to how small businesses get valued. Most trade between about 1.5x and 3.5x SDE, and size is the biggest driver — a smaller business (under ~$100K SDE) is often in the 1x range, while a larger one reaches the low-to-mid 3x’s. Within any size, recurring-revenue and licensed essential-service businesses (accounting, insurance, medical, the trades) sit higher; discretionary and hospitality businesses (restaurants, retail, gyms) sit lower.
EBITDA doesn’t add back an owner’s salary; SDE does. EBITDA is used for larger businesses that already pay a market-rate manager, while SDE is the standard for owner-operated small businesses because it captures the full benefit to a single owner. This calculator uses SDE.
A calculator gives you an honest ballpark from two inputs — your earnings and your industry. It can’t see owner-dependence, revenue quality, customer concentration, or growth, which can move real-world value 40% either way. Treat the range as a starting point, not an appraisal. A full assessment accounts for the factors a formula can’t.