What Is My Business Worth?

EBITDA (earnings before interest, taxes, depreciation, and amortization) is commonly used by larger companies to measure profitability. For smaller businesses—those earning under $1 million—Transworld focuses on the owner’s benefit. This figure includes net income plus depreciation, interest, and the owner’s salary and perks. Simply put, it reflects the total income available to a single owner assuming the business is free of debt.

Absolutely! Owner’s benefit multiples typically range from less than one up to around three. For larger companies with EBITDA near or above $1 million, multiples often fall between four and six. These multiples generally increase with the size, quality, and reliability of your owner’s benefit. Poor financial records, limited growth prospects, and low profits lead to lower multiples, while strong financials, promising futures, and robust growth command higher multiples.

You can use every valuation method available and still be surprised when the listing price and selling price are far apart. Nobody can tell you exactly what your business is worth: not your banker, CPA, lawyer, broker or mother-in-law. The only individual that will be able to tell you what your business is worth is the buyer — and that will be a subjective evaluation.