Learn simple DIY business valuation methods, free tools, and step-by-step techniques to estimate your business worth. Plus, discover the honest truth about when professional help is essential and why DIY can be costly.
Multiply your annual revenue by an industry-standard multiple.
$2M revenue × 1.2x multiple = $2.4M estimated value
Initial rough estimates, comparing to industry benchmarks
Value based on Seller's Discretionary Earnings (SDE) multiples.
$500K SDE × 3.2x multiple = $1.6M + inventory/equipment adjustments
Small businesses with owner involvement, preliminary sale preparation
💡 Multiples vary significantly by industry, size, and specific business characteristics
Sum up all assets at fair value minus liabilities.
$800K equipment + $200K inventory + $400K real estate - $300K debt = $1.1M
Manufacturing, real estate businesses, liquidation scenarios
Project future cash flows and discount to present value.
PV of 5-year FCF ($400K) + Terminal Value ($2.1M) = $2.5M enterprise value
Stable, predictable businesses, sophisticated business owners
Any valuation for divorce, estate planning, tax reporting, or litigation requires professional standards
Potential errors in DIY valuations can cost tens of thousands in negotiations
Multiple entities, partnerships, or holding companies require specialized expertise
Patents, brand value, customer relationships difficult to value without expertise
Normalizing earnings and selecting appropriate multiples requires professional judgment
Any disagreement about value requires defensible, professional methodology
Research, calculations, and analysis time that could be spent growing your business
DIY valuations may vary significantly from professional assessments
DIY valuations offer no legal protection in disputes, audits, or challenges. Even internal-use valuations may have legal implications if later discovered in litigation.
DIY business valuation can provide useful rough estimates for internal planning and curiosity. However, when accuracy matters—for legal compliance, tax reporting, transactions, or important business decisions—professional valuation is not just recommended, it's essential.
Remember: The cost of an inaccurate valuation often exceeds the cost of getting it right the first time.
Get an accurate, defensible business valuation from a Credentialed Valuation Professional (CVA, ASA, CPA/ABV). Often costs less than the risks of DIY mistakes.
Important Disclaimer: DIY business valuations are suitable ONLY for internal planning, preliminary estimates, and educational purposes. They are NOT appropriate for legal compliance, tax reporting, transactions, or any situation where accuracy matters. Professional valuations by certified experts are required for important decisions. These methods provide rough estimates only and should not replace professional judgment required by valuation standards.