Free Tool · 2025 M&A Multiples
What Is Your Business Worth?
Industry-specific valuation ranges based on actual 2025 lower middle market transaction data. Select your sector, enter your financials, and get an estimated range in under 2 minutes.
Select Your Industry
MSP M&A remains one of the most active sectors in lower middle market tech. Median transaction size is ~$38.5M with a median multiple of 8.9× EBITDA. PE roll-up activity is intense — over 200 MSP acquisitions occurred in 2024.
Enter Your Financials
Rate Your Business Quality
Within each size tier, your quality score determines where you fall in the multiple range.
Key Value Drivers for Managed Services (MSP)
- % Recurring MRR (target >70%)
- EBITDA margin (target >20%)
- Customer concentration (no client >15%)
- Cybersecurity practice revenue
- Average contract length
- Technician-to-client ratio
Enter your EBITDA above to calculate
Live Estimate
Managed Services (MSP)
EBITDA Tier: — · Quality: Good
Enter your EBITDA to see your estimate
Get a Real Valuation
This calculator gives you a range. A customized valuation analysis gives you a defensible number — and a strategy to maximize it.
Schedule a Confidential CallMethodology
How the calculator works.
Industry Selection
Each of the 12 sectors has its own multiple range and valuation methodology — EBITDA for most, ARR for SaaS and AI. Sector selection is the most important input.
Size Tier Multiples
Multiples vary significantly by company size. A $500K EBITDA MSP trades at 3–6× while a $7M+ EBITDA MSP trades at 8–13×. We apply the correct tier automatically.
EBITDA Normalization
We add back owner comp above market rate, non-recurring expenses, personal items, D&A, interest, and taxes to arrive at the true earnings power of your business.
Quality Adjustment
Within each tier, your quality score determines where you fall in the range. Recurring revenue, concentration, management depth, and margins are the key factors.
Data sources: Aventis Advisors MSP Valuation Report (Jan 2025), Drake Star MSP Market Update Q3 2025, Axial SaaS Multiples Guide (Jan 2026), Viaductus IT Industry Multiples 2025, Investec IT Services Valuation Update Q4 2025, First Page Sage EBITDA Multiples by Industry (Jan 2025), ClearlyAcquired SaaS & MSP Multiples (Feb 2026), Mergersandacquisitions.net Professional Services M&A Stats (Feb 2026). All figures represent lower middle market private company transactions ($1M–$250M enterprise value).
Frequently Asked Questions
Business valuation questions, answered.
How much is my business worth?
For most B2B tech and services businesses, value is calculated by multiplying your normalized EBITDA (or ARR for SaaS) by a sector-specific multiple. In 2025, lower middle market B2B tech companies trade at 4×–14× EBITDA depending on sector, size, and quality. MSPs trade at 5–12×, SaaS at 3–14× ARR, IT consulting at 5–14×, and staffing at 3–8×. The most accurate way to determine your specific number is to work with an M&A advisor who has current transaction data in your sector.
What EBITDA multiple should I use for my business?
EBITDA multiples vary by sector, company size, and business quality. In 2025: MSPs trade at 3–13× (size-dependent), IT consulting at 3–14×, vertical software at 3.5–16×, staffing at 2.5–12×, marketing agencies at 2.5–13×, VAR at 2.5–12×, and management consulting at 2.5–12×. Within each range, your specific multiple is determined by recurring revenue percentage, customer concentration, management depth, and growth rate. Larger companies consistently command higher multiples — a $7M+ EBITDA business typically trades at 2–3× the multiple of a sub-$1M EBITDA business in the same sector.
What is the difference between EBITDA multiple and ARR multiple?
EBITDA multiples are applied to earnings (profit) and are used for most B2B services and software businesses. ARR multiples are applied to Annual Recurring Revenue and are used for SaaS and AI companies where growth rate is more important than current profitability. A SaaS company growing at 40%+ may trade at 8–12× ARR even with negative EBITDA, while a mature SaaS company with 10% growth trades at 3–5× ARR. For most non-SaaS businesses, EBITDA is the correct valuation basis.
How do I normalize EBITDA for a business sale?
EBITDA normalization adds back non-recurring and owner-specific expenses to arrive at the true earnings power of the business. Key add-backs include: (1) owner compensation above a market-rate CEO salary replacement, (2) non-recurring expenses like one-time legal fees or equipment purchases, (3) personal expenses run through the business, (4) depreciation and amortization (D&A), (5) interest expense, and (6) income taxes. Normalized EBITDA is typically 20–50% higher than reported net income for owner-operated businesses.
How long does it take to sell a B2B tech business?
A properly prepared B2B tech business typically takes 6–12 months to sell from the time you engage an advisor to close. The process includes: preparation and positioning (1–3 months), marketing and buyer outreach (2–3 months), LOI and exclusivity (1 month), due diligence (2–3 months), and closing (1 month). Businesses that are exit-ready before going to market close faster and at higher multiples. The Exit Readiness Assessment identifies the specific gaps that could slow your process or reduce your valuation.
What is the most important factor in maximizing my exit valuation?
Recurring revenue percentage is consistently the most important single factor in B2B tech M&A valuations. Businesses with >70% recurring revenue command 2–4× higher multiples than comparable businesses with project-heavy revenue. Other top factors include: customer concentration (no single client >15% of revenue), management depth (business can run without the founder), EBITDA margin (>20% is institutional quality), and growth rate. Starting exit preparation 18–24 months before your target sale date gives you time to address these factors and materially increase your valuation.
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