Revenue Multiple Valuation Calculator
It ignores margin entirely.
Valuation multiples vary widely with market conditions, buyer type and the quality of the business. These are planning estimates, a broker's valuation and a completed sale are different things again.
Value on a revenue multiple
$1,080,000
$576,000 on earnings
A revenue multiple ignores margin entirely, which is why it flatters low-margin businesses and undervalues efficient ones. The 0.90× revenue multiple here implies 6.0× earnings: worth checking against what the earnings multiple actually supports.
How the Revenue Multiple Valuation Calculator works
A revenue multiple ignores margin entirely, which flatters low-margin businesses and undervalues efficient ones. Checking what earnings multiple it implies is the quickest way to see whether the number is defensible.
Also known as: valuation by revenue multiple · times revenue valuation · sales multiple calculator
Not financial advice. Marketplace fees change, and they vary by country, plan and seller status. Every rate here is an editable default, not a quoted price, check the platform's current fee schedule before you price a product against it. This is not tax or business advice.
Frequently asked questions
When is a revenue multiple appropriate?
For high-growth businesses where earnings are deliberately suppressed by reinvestment, and for comparing across a sector with similar cost structures. Rarely for a mature small business.
What revenue multiple is typical?
For profitable small ecommerce, commonly well under one times revenue. Anything approaching or exceeding revenue implies either exceptional margins or exceptional growth.
How do I sanity-check it?
Divide the resulting valuation by earnings. If the implied earnings multiple is far above what comparable businesses trade at, the revenue multiple is doing the work rather than the business.
Do buyers use revenue multiples?
Some do as a screening heuristic, then move to earnings for the actual negotiation. A seller quoting only a revenue multiple is usually the one with a margin problem.