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Business Valuation
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What is a business valuation? A business valuation is the process of estimating what a business is worth — the single number that represents its overall economic value at a point in time. Understanding this figure matters whether you are considering selling a business, acquiring one, bringing in investors, settling a partnership dispute, planning for succession, or simply wanting to know how much value you have created. There is no single "correct" valuation — different methods reflect different things about a business, and in practice, professional valuations often use several approaches and triangulate between them. This calculator offers four widely used methods: Discounted Cash Flow (which values a business based on its future earning power), Asset-Based (which values it on what it owns minus what it owes), Market Capitalisation (for publicly traded companies only), and Market Multiples (which benchmarks the business against comparable companies using industry-standard ratios). Each produces a legitimate but distinct perspective on value.
DCF — Discounted Cash Flow Valuation
The net cash your business is expected to generate each year — what is left after all operating costs are paid. Use a realistic, sustainable figure, not a one-off peak year. If your cash flows vary, use an average or a conservative estimate.
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How many years ahead you expect this level of cash flow to continue. Most businesses use 5–10 years. Beyond that, estimates become highly uncertain.
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The rate used to convert future cash to today's value — reflects risk and opportunity cost. Common range: 8–15% for private businesses.
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Quick-select a rate:
The rate at which the business is expected to grow in perpetuity beyond the projection period. This is used to calculate a "terminal value" — the ongoing worth of the business after the explicit forecast window. Leave at 0 if you prefer to ignore terminal value, or use 2–3% as a conservative long-run estimate.
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Year-by-year cash flow preview
Asset-Based Valuation
List each type of asset and its estimated market value. Include physical items like property, equipment, vehicles, and inventory, as well as financial assets like cash, receivables, and investments. Intangible assets (patents, brand value, software) can be included if you have a reliable estimate.
List all debts and obligations — bank loans, outstanding invoices, tax liabilities, lease commitments, and any other financial claims on the business. Be thorough; understating liabilities overstates the value.
Market Capitalisation Valuation
This method applies to publicly listed companies only. It reflects the market's current assessment of a company's total equity value and can change significantly with market sentiment, even when the underlying business has not changed.
The total number of shares issued by the company and held by all shareholders — including institutional investors, insiders, and the public. Usually found in the company's annual report or financial filings.
The market price of a single share at the time of the calculation. This can be found on any stock exchange website or financial data service.
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Market Multiples Valuation
Choose the metric that best reflects your business's financial performance. EBITDA is the most common for established businesses. Revenue multiples are common for fast-growing companies. Net profit is used when the business has a clean, stable earnings history.
Enter the most recent full-year figure for the metric you selected above.
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The valuation multiple applied to your chosen metric. Varies significantly by industry, size, and growth rate. Use the reference table below or research current multiples for your sector.
Common EBITDA multiples by industry — click to use
| Industry | Typical multiple range |
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These are indicative ranges only. Actual multiples vary with market conditions, company size, growth rate, and deal-specific factors. Always verify with current market data.
Estimated business valuation