Get a realistic valuation using SDE and DCF methods. Perfect for small business owners and buyers looking to assess fair market value based on profit, growth, and industry.
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It Estimates The Value Of Your Business Using Two Proven Methods SDE-Based Valuation And Discounted Cash Flow (DCF) And Gives You A Realistic Range From Conservative To Optimistic Scenarios.
SDE is the total financial benefit available to a business owner. It’s calculated by adding back the owner’s salary and one-time expenses to the business’s net profit.
These are used to calculate your net profit, which is the foundation for determining SDE and forecasting future cash flows in the DCF model.
Non-recurring expenses are one-time costs that don’t reflect the ongoing operations of the business (e.g., legal fees, equipment upgrades). Including them helps reveal your business’s true earning potential.
The valuation multiple is chosen based on your industry type. It reflects how businesses in that industry are typically valued relative to their earnings.
The Discounted Cash Flow (DCF) method projects future earnings and then calculates their present value based on your selected growth rate, time horizon, and risk level.
SDE valuation is based on past performance using a simple multiplier, while DCF valuation looks forward, estimating what your business could earn over time and adjusting for risk and time value.
The range accounts for variables like industry shifts, economic uncertainty, and how aggressive or conservative the assumptions are. It gives you a more flexible and realistic view of your business’s value.
Yes, it’s ideal for sellers who want to understand what their business is worth before listing it or negotiating with buyers.
Yes, it provides a strong estimate using industry-accepted valuation methods. For investment or legal decisions, you may still want a certified appraisal, but this gives a solid starting point.
