Business Exit Value Calculator

EBITDA multiples vary by industry and business quality. Service and consulting businesses typically trade at 4–6×, professional services and mid-market SaaS at 6–8×, and high-growth SaaS at 8–15×. Retail and restaurants often trade at 3–5×. Within any industry, the multiple rises with recurring revenue percentage, management depth below the owner, low customer concentration, and growth rate. A business with 70% recurring revenue and documented systems commands a premium multiple versus one relying on the owner's personal relationships.

SDE (Seller's Discretionary Earnings) adds back the owner's total compensation and personal perks to EBITDA, representing total earnings available to a new owner-operator. SDE is typically used for businesses under $2–3M in revenue with a 2–4× multiple. EBITDA is standard for businesses above $2–3M where professional management is in place, with multiples of 4–10×+. This calculator uses EBITDA. If your business is under $2M revenue and you're the primary operator, SDE analysis may give a more accurate picture of buyer pricing.

Yes. The OBBBA (One Big Beautiful Bill Act, July 2025) raised the Section 1202 QSBS exclusion from $10M to $15M per shareholder per company for qualifying stock issued after July 4, 2025. Select "QSBS eligible" and the calculator shields up to $15M of your gain from the 23.8% federal rate (20% LTCG + 3.8% NIIT). QSBS requires a C-corporation structure, gross assets under $50M when stock was issued, a 5-year minimum holding period, and original issuance to you — not a secondary purchase. See the QSBS §1202 guide for full qualification requirements.

An installment sale under IRC §453 spreads gain recognition over your payment schedule rather than recognizing it all in the year of sale. This can keep you in lower capital gains brackets in the sale year and defer income to lower-income years — for example, after business income stops. The tradeoff is credit risk on the buyer and potential §453A interest charges when the outstanding installment obligation exceeds $5M. Use our installment sale tax calculator to model year-by-year after-tax proceeds under an installment structure versus a lump-sum exit.

In a stock sale, you sell your shares and pay long-term capital gains on the full proceeds. In an asset sale, the buyer acquires individual assets and gets a stepped-up basis, but you face ordinary income tax on depreciation recapture and inventory. Sellers generally prefer stock sales; buyers generally prefer asset sales. The tax gap can be $150K–$300K+ in additional tax on a $5M deal depending on asset mix. S-corps can partially mitigate this via personal goodwill allocation. See asset sale vs. stock sale: full tax comparison.

The highest-impact moves — QSBS qualification (5-year holding requirement), ESOP setup, entity structure conversion, and EBITDA margin improvement — typically take 3–7 years to execute. Owners who start planning 18 months before their target exit date have already missed most of them. The optimal window is 5–10 years out: years 10–5 for structural decisions, years 5–3 for financial optimization, years 3–1 for transaction preparation. See the business exit planning 10-year roadmap for a phase-by-phase timeline.