How the estimated value swings as the earnings (SDE) and revenue multiples move around your entered figures. The multiple drives almost everything, which is why a credible comparable matters more than the formula.
Multiple shift
Profit-based value
Revenue-based value
Blended midpoint
Multiples −1.0×
300,000.00
400,000.00
350,000.00
Multiples −0.5×
375,000.00
800,000.00
587,500.00
As entered
450,000.00
1,200,000.00
825,000.00
Multiples +0.5×
525,000.00
1,600,000.00
1,062,500.00
Multiples +1.0×
600,000.00
2,000,000.00
1,300,000.00
Estimates only — not financial, tax, or professional advice.
100% private — every number you enter is calculated in your browser and never sent to our servers.
What it calculates: Estimated Valuation (Profit-Based), Seller's Discretionary Earnings (SDE), Valuation (Revenue-Based), Blended Midpoint.
Updated 5 June 2026 · Transparent assumptions
Seller discretionary earnings, not accounting profit
Small businesses are priced on what an owner-operator actually takes out, which is accounting profit plus the costs that exist because of this particular owner: their own salary, personal expenses run through the business, and genuinely one-off items.
That is why add-backs are a separate input. A business showing modest profit after paying the founder a full salary can be considerably more valuable than the accounts suggest — and a seller inflating add-backs with costs a buyer will still incur is the most common way this figure is overstated.
Age, growth, concentration and how much the owner does
Multiples for small online businesses commonly sit in the low single digits of annual earnings, and the range is wide. Longer trading history, steady or growing earnings, diversified traffic and a low owner workload all push it up.
The things that push it down are concentration risks: one supplier, one platform, one traffic source, or a business that stops working the week the founder leaves. A buyer is pricing the risk of the earnings continuing without you.
It matters most where earnings are thin or deliberately suppressed
Applying a multiple to revenue gives a second reading that does not depend on how the profit was calculated. When the two figures diverge sharply, the earnings number usually deserves scrutiny — either the add-backs are aggressive or the business is being run for growth rather than profit.
For a profitable, steady business the earnings multiple is the one that governs. The revenue figure is there to catch the cases where it should not be trusted.
Inventory, debt, working capital and the deal structure
The figure here is an enterprise value for the operating business. Inventory is commonly transferred at cost on top, debt is settled out of proceeds, and working capital needs a normalisation that is negotiated rather than calculated.
Structure moves the real number as much as the multiple does. An all-cash offer and an earn-out paid over two years contingent on performance are not the same deal at the same headline price.
Sources & References
Figures on this page are checked against primary, authoritative sources. Links open in a new tab.
Results are estimates for planning and analysis based on the figures you enter. They are not accounting, tax, or financial advice — verify with your own records and a qualified professional before making decisions.
Published the calculator with its formula, worked example, assumptions, limitations and a bespoke guide, and added an automated formula test suite covering it.
Tested the earnings valuation on profit plus add-backs at the multiple entered, with the revenue multiple as an independent second figure.
Tested that add-backs raise the valuation by exactly the multiple times the add-back, and that both valuations scale linearly.
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