BUSINESS VALUATION CALCULATOR

VALUATION CALCULATOR

Company Value Calculator

His company value calculated provides a quick estimate based on your business's financial and industry tends. It's a helpful tool for owners planning ahead or exploring future opportunities.

Understanding Business Valuation Valuing a business involves both analytical and strategic considerations. Our Most Probable Selling Price (MPSP) calculator helps answer essential questions such as:

“What is my business worth?” “How can I calculate the value of my business?” “What factors influence my business’s valuation?”

Other influencing factors include your location, the ease of ownership transfer, financing availability, and your desired timeline for selling all of which can significantly impact the final value.

Begin Your Valuation Today By using this calculator, you'll gain valuable insight into your business's current market value and discover opportunities to enhance its worth. For a personalized consultation and to take the next step toward successfully selling your business, contact us today.

Industry

Year Established

Location

Total Gross Revenue

The total amount of money generated from all sales before any expenses are deducted. This metric provides an overview of the company's overall sales performance.

Seller's Discretionary Earnings (SDE)

Seller's Discretionary Earnings (SDE) represents the total financial benefit a single full-time owner-operator would derive from the business. It is a combined estimate of the business's net income, owner's compensation, fringe benefits, discretionary expenses, interest, and depreciation.

Percentage Of Largest Customer

The proportion of the business's total revenue that comes from its largest customer. This metric indicates the level of dependence on that customer.

3-Year Average Revenue Growth

This value can be positive or negative. It represents the average annual increase in revenue over the past three years, a metric that helps in understanding the company's growth trend and financial performance..

Strength Of Management Team

Poor

Average

Good

An assessment of the skills, experience, and effectivness of the company's leadership team. Having excellent systems and a capable management team can be appealing to a broad range of potential buyers.

This tool does not constitute a formal business valuation or a professional opinion of market value. The results generated are estimates only and are intended for general informational purposes. Transworld Business Advisors and Aniss Cherkaoui have not reviewed, verified, or validated any of the submitted data and make no representations or warranties regarding the accuracy or applicability of the results.

Each business and financial situation is unique. For a formal valuation or professional advice, please consult a qualified valuation expert, CPA, or financial advisor.

Please note that any information you provide will be shared with Aniss Cherkaoui, P.A. and will be treated with strict confidentiality.

How the Most Probable Selling Price (MPSP) Calculator Works

Data-Driven Methodology
I use a proven, data-driven approach to estimate your business’s Most Probable Selling Price (MPSP), based on actual market comparables.
Application of Market Multiples
Market-derived multiples are applied to the adjusted SDE to determine a realistic price estimate aligned with comparable market activity.
General Estimate, Not a Guarantee
The MPSP estimate provides an informed view of market value based on data and market behavior. It is not a substitute for professional legal, accounting, or tax advice.
Comparable Market Sales
The process begins by analyzing the sale prices of similar businesses using multiple reputable databases, including:
- PRATT STATS
- BIZCOMPS
- Industry-specific valuation guides
- Business brokerage transaction databases
SDE-Based Valuation Model
The estimate is grounded in the relationship between the Sales Price (SP) and Seller’s Discretionary Earnings (SDE) a key measure of financial performance:
- SDE is calculated by adjusting net income before taxes and adding back the owner’s compensation, interest, depreciation, and one-time or non-recurring expenses.
- This restated figure provides a clearer picture of the business’s true earning power.
Buyer Investment Perspective
The model also considers how potential buyers evaluate opportunities, focusing on factors such as:
- Return on Invested Cash
- Payback period
- Perceived risk of the investment
Financing Considerations
The availability of financing such as seller financing or SBA-backed loans can enhance a business’s attractiveness by:
- Reducing the buyer’s upfront capital requirement
- Increasing return on investment
- Making the deal more accessible and appealing
Balance Sheet Review
I review the most recent balance sheet to determine:
- Which assets and liabilities will transfer with the business
- Which will be retained by the seller
- Estimated net proceeds to the seller after accounting for transaction costs and obligations
Personalized Support Available
While this tool offers a professional estimate, I encourage you to schedule a free consultation for a more tailored discussion about your business.

Business Valuation Methods Explained - Why the MPSP Approach Works Best for Business Sales

When valuing a business, several methods can be used, each suitable for different scenarios. Below, I compare some common valuation methods such as Discounted Cash Flow (DCF), Asset-Based Valuation, and the Most Probable Selling Price (MPSP) and explain why the MPSP approach is often the most effective for businesses that are up for sale.

1. Discounted Cash Flow (DCF) Valuation

The Discounted Cash Flow (DCF) method projects a business's future cash flows and discounts them to their present value using an appropriate discount rate. This method is useful for assessing potential long-term profitability. While it works well for larger, established businesses with predictable earnings, it has limitations for small to medium-sized businesses. DCF relies heavily on assumptions about future growth, discount rates, and market conditions, which makes it prone to significant errors if these assumptions are inaccurate. This can result in either overvaluing or undervaluing the business, which is problematic for sellers and buyers alike.

2. Asset-Based Valuation

Asset-based valuation determines a business's value based on its net assets, using either a liquidation approach or an adjusted book value approach. This method is best suited for companies with significant physical assets, such as those in manufacturing or real estate. However, it often undervalues businesses that derive much of their value from intangible assets such as brand reputation, customer relationships, or goodwill. Asset-based valuation also fails to adequately consider the ongoing profitability of a business, which is a key factor for potential buyers.

3. Most Probable Selling Price (MPSP) Using Market Comparables (The Preferred Approach)

The Most Probable Selling Price (MPSP) approach, which I use, relies on direct market comparables. This means evaluating the actual sale prices of similar businesses using reputable databases and focusing on Seller Discretionary Earnings (SDE). Here’s why the MPSP approach is the most commonly used and reliable method for valuing businesses that are up for sale:

Rooted in Real Market Data: Unlike DCF, which depends on future projections, the MPSP method uses actual sales data from comparable businesses. This makes the valuation more realistic and aligned with market expectations, reflecting what buyers are willing to pay based on historical transactions.
Emphasis on Earnings and Buyer Behavior: The MPSP approach places a significant focus on Seller Discretionary Earnings (SDE), which captures the true financial benefit available to the owner. SDE is critical in assessing small to medium-sized businesses because it provides a clear picture of profitability. The MPSP also takes into account how potential buyers evaluate investments, such as focusing on the Return on Invested Cash and considering available financing options, which makes it highly practical for determining market value.
Considers Both Tangible and Intangible Assets: Unlike asset-based valuation, which mainly considers physical assets, the MPSP approach includes intangible aspects such as brand value, customer loyalty, and ease of transition factors that are vital to a buyer's decision.
Straightforward and Market-Aligned: The MPSP method is simpler and more transparent, making it easier for both sellers and buyers to understand. By aligning closely with market comparables, it fosters trust, ensuring both parties feel confident in the valuation, ultimately facilitating a successful sale.

For business owners looking to sell, the MPSP method provides a balanced, market-aligned perspective on value, making it the preferred choice. It combines tangible financial metrics with market realities and buyer perspectives, offering a clear and effective valuation that is grounded in real data. This helps ensure the business is appropriately priced for a smooth and successful sale.

Get a Personalized Business Valuation - Contact Me Now

Recognized by Industry Leaders

Aniss Cherkaoui has been recognized by two of the most respected organizations in the business brokerage industry. In 2024, he was named the #1 Top Volume Producer by the Business Brokers of Florida (BBF) and received the Platinum Chairman’s Circle Award from the International Business Brokers Association (IBBA) a distinction awarded to the nation’s top-performing brokers. These honors reflect his proven track record, commitment to excellence, and leadership within the business sales community.

View official award recognition

Frequently Asked Questions

Is this really free?

↓

Yes there’s no cost or commitment. We believe in empowering business owners with tools that help them make informed decisions.

How do I know this estimate is accurate?

↓

Your estimate is backed by years of actual deal data and evaluated using our MPSP methodology. While it’s not a formal appraisal, it offers more precision than generic online calculators.

What happens after I get my valuation?

↓

After reviewing your results, you can choose to connect with Aniss Cherkaoui for a personalized consultation. He’ll walk you through next steps, buyer targeting strategies, and market timing.

Can I use this for SBA loans or legal proceedings?

↓

This tool provides a general estimate and is not intended for legal, financial, or tax use. For formal valuations, we offer certified appraisal services through our trusted partners.

Why Do You Need a Business Valuation?

↓

A business valuation is often necessary for several reasons, whether you are seeking financing, planning a sale, or assessing your financial strategy. Here are some common reasons:

Litigation

Legal situations like divorce settlements, partnership disputes, damage claims, or shareholder disputes often require a formal business valuation. Litigation outcomes can significantly impact the business's value and future earnings.

Future Planning

A business valuation provides owners with insights into factors that drive growth, profitability, and efficiency, enabling informed decision-making and strategic planning. These insights can help in optimizing operations or expanding into new markets.

Tax and Succession Planning

Valuations help estimate estate taxes, gift tax responsibilities, and prepare for retirement. They align with IRS guidelines by providing an accurate assessment of value, ensuring compliance and proper documentation for tax purposes. Valuations also support smooth succession planning.

Sales, Mergers, and Financing

Valuations are essential for negotiations involving sales, purchases, or mergers. They provide a basis for determining fair pricing and offer negotiation leverage to ensure favorable outcomes. Valuations also serve as benchmarks for partner buy-ins, shareholder buy-outs, and financing from lenders. Employee stock ownership plans often rely on valuations for establishment and management.

Insurance Coverage

Valuations help determine the appropriate level of insurance coverage needed to protect the company's assets, such as key person insurance or business interruption policies.

Benchmarking Performance

Regular valuations allow owners to track the company's performance, identify strengths and weaknesses, set goals, and make adjustments to improve profitability. For example, metrics such as revenue growth rate, profit margins, and return on assets can be monitored to evaluate progress.

What Makes a Business Valuable to Buyers?

↓

The value of a business is fundamentally determined by two key elements: the potential return on investment (ROI) and the associated risk level. Buyers tend to pay more for businesses that promise strong ROI and minimal risk. For instance, a well-established e-commerce store with diversified revenue streams and a loyal customer base is perceived as having high ROI potential and low risk. To enhance your business's value, it is essential to minimize uncertainties and demonstrate stability. Here are some main attributes that increase a business’s appeal and value to potential buyers:

Businesses that offer financing options are more attractive, as these options make acquisition more feasible and decrease perceived risks.
Accurate financial records and well-maintained books, ensuring transparency and financial health.
Predictable key drivers of new sales and revenue.
Consistent or increasing customer traffic from diverse marketing channels.
Strong relationships with reliable suppliers, including backup options for added security.
High percentage of repeat sales, reflecting strong customer satisfaction and brand loyalty.
Clean legal record, free from disputes or liabilities.
Effective brand protection, free of trademark, copyright, or legal issues.
Well-documented systems and processes, such as standard operating procedures (SOPs), to ensure smooth and consistent operations.
Clear evidence of growth potential, indicating scalability opportunities for future expansion.

These characteristics signal to buyers that the business is structured for success with minimal risks, thereby directly enhancing its market value.

Our Business Valuation Calculator is trusted by entrepreneurs across South Florida, including Fort Lauderdale, Miami, and West Palm Beach. We serve businesses in Broward, Miami-Dade, and Palm Beach Counties with accurate, confidential valuation estimates tailored for owners exploring their exit strategy.

Free Business Valuation Calculator Results

Get an accurate, data-backed valuation estimate in seconds. This is a sample of the valuation range you’ll see after using our calculator:

Sample results from the free business valuation calculator showing estimated business value

Why Business Owners Trust my Calculator:

1

Instant Business Valuation Range No waiting get your estimated business value right away.
2

Data-Driven Accuracy Calculations are based on thousands of real private business sales and market insights.
3

Built for Owners Ready to Sell Whether you’re planning an exit, seeking investors, or just curious, this tool gives you a realistic snapshot of your business’s current value.

Call Today to Speak with a Broker - 305-608-3761