How much is my business worth?
Reviewed by the RealDeal360 deal team · Updated November 2026 · 5-minute read
The short answer
Buyers usually price a profitable private company as a multiple of its adjusted yearly earnings (EBITDA). In the 2026 Pepperdine survey, typical multiples ran from about 3x for smaller companies to about 7.5x for larger ones.1 Where you land depends less on your industry than on how much the business depends on you, how steady the earnings are, and how clean the books are.
How buyers actually do the math
Adjust the earnings
Start from EBITDA, then add back costs a new owner won't have: above-market owner pay, one-time legal bills, personal expenses run through the company.
Apply a multiple
The multiple is the buyer's view of risk. Lower risk, higher multiple. That figure is the enterprise value: the price for the whole business, debt-free.
Settle up at closing
Debt is paid off, and the price adjusts for cash and working capital. Then taxes and deal costs come out. What's left is what you keep.
What moves your multiple
Pushes it up
- A team that runs day to day without you
- Repeat or contracted revenue
- Books a buyer's accountant can check quickly
- Customers spread across many accounts
- Steady or rising earnings, three years running
Pulls it down
- You hold the key customer relationships
- One customer is a large share of sales
- Mixed personal and business spending
- Earnings that swing year to year
- Open legal, lease or licence issues
A worked example
Hypothetical numbers, for illustration only.
| Reported EBITDA | $1,750,000 |
|---|---|
| Add-backs (above-market owner pay, one-time costs) | + $250,000 |
| Adjusted EBITDA | $2,000,000 |
| × an assumed multiple | × 5.0 |
| Enterprise value | $10,000,000 |
| Less debt paid off at closing | − $1,200,000 |
| Proceeds before taxes and deal costs | $8,800,000 |
Taxes come next, and deal structure changes them a lot. See How much tax will I pay when I sell?
Why online calculators miss
A calculator multiplies a number you type by an industry average. It can't see your add-backs, how much of the business runs through you, or what a buyer's accountant will question. Those are exactly the things that move the multiple, so two companies with the same earnings can sell for very different prices.
Sources
- Pepperdine Graziadio Business School, Private Capital Markets Report 2026: median EBITDA multiples of 3.00x–7.50x across company-size bands surveyed.
General information, not tax, legal or investment advice. Examples are hypothetical; every business is different and nothing here is a valuation or a guarantee.