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Shopify App Valuation Calculator

What a Shopify app sells for: earnings after the App Store share, with the multiple adjusted for merchant churn and platform risk.

Updated · By Niraj Kumar · 4 sources

Revenue

$

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

%
−10%30%

After churn. 4% a month is 60% 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%
Estimated exit value$191,000Range $159,000 to $223,000
SDE, a year
$63,600
Profit before your pay, valued at 3.00×
EBITDA, a year
$16,800
After $46,800 to replace your 15 hours a week; 11.4× EBITDA
MRR multiple
23.9×
1.99× ARR
Revenue cross-check
$367,000
$96,000 ARR × 3.83×; the estimate weighs profit 100%, revenue 0%
LTV:CAC
56.7
LTV $425, CAC $8, paid back in 0.4 months
How the multiple is builtTurns of SDE added or taken off, largest first.
FactorTurns
Base: SDE $50k to $100k3.00×
Growing 60 to 100% a year+0.75
Platform risk: high−0.70
Churn 4 to 6% a month−0.40
LTV:CAC 3 or more+0.25
Gross margin 80% or more+0.10
Part-time founder, 5 to 20 hours0
Two years or more of history0
No customer over 10% of revenue0
SDE multiple3.00×
From revenue to SDE and EBITDA, a year
ARR (MRR × 12)$96,000
Cost of revenue (15%)-$14,400
Gross profit$81,600
Operating costs-$14,400
Paid marketing-$3,600
SDE$63,600
Founder's time (15 h × $60 × 52)-$46,800
EBITDA$16,800
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 is a micro-SaaS valued?

A Shopify app on $8,000 MRR growing 4% a month, with 5% merchant churn, is worth about $191,000 (3.0× SDE). Growth from App Store search helps, but buyers take off most of a turn because Shopify controls the store, the billing and the rules.

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 Shopify app on $8,000 MRR from merchants paying $25 a month, growing 4% a month through the App Store, with 5% monthly churn as stores close, 85% margin after Shopify's revenue share, and a founder answering support 15 hours a week.

  1. 1ARR: $96,000; gross profit at 85%: $81,600
  2. 2SDE: $81,600 − $18,000 of costs and marketing = $63,600
  3. 3Base multiple for SDE of $50k to $100k: 3.0×
  4. 4Adjustments: growing 60 to 100% a year +0.75; platform risk: high −0.70; churn 4 to 6% a month −0.40; lTV:CAC 3 or more +0.25; gross margin 80% or more +0.10
  5. 5SDE multiple: 3.00×, so $63,600 × 3.00× = $191,000
  6. 6Revenue cross-check: 3.8× ARR = $367,000; weight on profit 100%

About $191,000, within $159,000 to $223,000: 23.9× MRR, and 11.4× EBITDA after paying $46,800 a year for the founder's hours.

Frequently asked questions

Why do buyers discount Shopify apps?

Platform risk. Shopify sets the revenue share, can change its APIs or ranking, and can build a competing feature into the platform. Merchant churn is also high because stores close. The calculator takes 0.7 of a turn off for a high platform dependency; an app with its own billing outside the App Store counts as moderate.

Should I enter MRR before or after Shopify's revenue share?

Before, as merchants are billed, and put Shopify's share into gross margin: with 15% to Shopify and a little hosting, margin is about 85%. The first $1M of lifetime revenue is charged 0% under Shopify's reduced plan, so check what you actually pay and set the margin to match.

What multiple does a Shopify app sell for?

For the business on this page, about 3.0× SDE, or 24× MRR: $191,000 on $8,000 of MRR and $63,600 of annual SDE. Change the inputs above to your own figures; churn, growth and founder hours move the multiple most.

Sources

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