English for Kids. FREE playlearning™ content curated by the Lingokids educators team.

English for kids

Free Playlearning™ content curated by the Lingokids educators team.

how do you value a business to buy

English for kids

Common for high-growth startups that aren't yet profitable. For example, a fintech firm might trade at 3.7x to 7.4x revenue.

Can reach 15x to 25x due to high growth potential.

This is the most common method for small to medium businesses (SMEs). It values a company based on what similar businesses have sold for.

Valuing a business is a blend of financial science and market-based art. Buyers typically use three core approaches—Market, Income, and Asset—to triangulate a "fair" price. For a reliable valuation, you should use at least two methods to verify your findings. 1. The Market Approach (Multiples)

The standard formula is Enterprise Value = EBITDA × Industry Multiple . Small Businesses: Often trade at 3x to 6x EBITDA.