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SaaS EBITDA Multiple Calculator

Turn owner earnings into EBITDA by paying for the founder's hours, and see the EBITDA and SDE multiples a sale price implies.

Updated · By Niraj Kumar · 4 sources

Revenue

$

Average of the last three months, before payment fees and platform shares.

%
−10%30%

After churn. 3% a month is 43% a year.

%
0%20%

MRR lost each month to cancellations and downgrades, as a share of MRR.

$
months

Months of revenue a buyer can verify.

Costs and margin

%
0%100%

Revenue left after hosting, payment fees, platform shares and model or API costs.

$

Tools, contractors, support staff. Leave out your own pay and marketing.

Acquisition

$

0 if growth is all organic.

Risk and founder

Support, development, marketing: everything a buyer would take over.

$/h

What a buyer would pay a hire or contractor. Used for EBITDA.

Platform dependencyPlatform dependency
%
0%100%
EBITDA multiple11.3× EBITDA$351,000 on $31,200 of EBITDA, 3.8× SDE
Estimated exit value
$351,000
$304,000 to $398,000
SDE, a year
$93,600
Profit before your pay, valued at 3.75×
EBITDA, a year
$31,200
After $62,400 to replace your 20 hours a week; 11.3× EBITDA
MRR multiple
23.4×
1.95× ARR
Revenue cross-check
$662,000
$180,000 ARR × 3.67×; the estimate weighs profit 100%, revenue 0%
LTV:CAC
26.2
LTV $3,280, CAC $125, paid back in 1.3 months
How the multiple is builtTurns of SDE added or taken off, largest first.
FactorTurns
Base: SDE $50k to $100k3.00×
Growing 30 to 60% a year+0.40
LTV:CAC 3 or more+0.25
Gross margin 80% or more+0.10
Churn 2 to 4% a month0
Part-time founder, 5 to 20 hours0
Two years or more of history0
Platform risk: independent0
No customer over 10% of revenue0
SDE multiple3.75×
From revenue to SDE and EBITDA, a year
ARR (MRR × 12)$180,000
Cost of revenue (18%)-$32,400
Gross profit$147,600
Operating costs-$36,000
Paid marketing-$18,000
SDE$93,600
Founder's time (20 h × $60 × 52)-$62,400
EBITDA$31,200
SDE multiple for each example businessEach vertical's starting example on these pages. Hover or focus a row for its value and churn.
  1. 1Developer tool / API4.8× SDE
  2. 2B2B SaaS3.8× SDE
  3. 3WordPress plugin3.0× SDE
  4. 4Shopify app3.0× SDE
  5. 5Chrome extension2.1× SDE
  6. 6Productised service1.8× SDE
  7. 7Notion / no-code templates1.5× SDE
  8. 8AI wrapper / GPT app1.5× SDE

How do SDE and EBITDA multiples differ?

EBITDA is SDE minus a market wage for the founder's role. At 20 hours a week and $60 an hour, the B2B SaaS example's $93,600 of SDE becomes $31,200 of EBITDA, so the same $351,000 price is 3.8× SDE but 11.3× EBITDA.

SDE = MRR × 12 × gross margin − (operating costs + marketing) × 12 EBITDA = SDE − founder hours × hourly rate × 52 SDE multiple = size-band base + growth + churn + founder + age + platform + concentration + LTV:CAC + margin (1.5× to 8×) value = w × SDE × SDE multiple + (1 − w) × ARR × ARR multiple, w = 0 at 10% SDE margin rising to 1 at 40%

This page uses the same method as the Micro-SaaS Valuation Calculator, which explains each term and assumption in full.

Worked example

A three-year-old B2B SaaS on $15,000 MRR at $120 a seat-month, growing 3% a month net, with 3% monthly churn, 82% gross margin, $3,000 a month of tools and contractors, $1,500 of ads bringing 12 customers, and a founder working 20 hours a week.

  1. 1SDE: $147,600 gross profit − $54,000 of costs = $93,600
  2. 2Founder's time: 20 hours × $60 × 52 weeks = $62,400
  3. 3EBITDA: $93,600 − $62,400 = $31,200
  4. 4Price: $93,600 × 3.75× SDE = $351,000

$351,000 is 3.8× SDE and 11.3× EBITDA: the same price, measured against two definitions of profit.

Frequently asked questions

Why is my EBITDA multiple so much higher than my SDE multiple?

Because EBITDA is smaller. Paying a market wage for the founder's hours can take half or more of a micro-SaaS's profit, so the same price divided by a smaller number gives a bigger multiple. A 10× EBITDA quote for a small SaaS is often the same deal as 3 to 4× SDE. Compare offers on one basis.

What hourly rate should I use for my time?

What a buyer would pay someone else to do the work: a part-time developer, a support contractor or an operator. $40 to $80 an hour covers most micro-SaaS roles in the US and Europe; less if the work could go to a lower-cost region. Sellers tend to undercount their hours, so log a typical month before entering it.

Sources

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