Revenue Multiple Valuation Calculator

How it is calculated

The valuation is one multiplication: Value = R × M. R is annual revenue, which should cover the last twelve months or the current annual run rate, and M is the revenue multiple, a plain number such as 6.5 meaning 6.5 times revenue (displayed as 6.50x). The result is shown in US dollars. Revenue and multiple may be zero, which gives a valuation of $0.00, but neither can be negative or empty. The tool does not set a limit on the multiple. The calculation uses the multiple exactly as typed, while the 6.50x label is rounded to two decimals. It values the whole company (enterprise or equity value depends on the benchmark you took the multiple from), not a share of it.

Common mistakes

• Typing the multiple as a percentage. A multiple of 650 would give 650 times revenue, not 6.5, and the tool accepts it without warning.
• Using monthly revenue with a multiple built for annual revenue. Convert to annual first, or the valuation comes out twelve times too small.
• Applying a multiple from a very different business. A fast-growing software company and a slow-growth shop with the same revenue rarely trade at the same multiple.
• Mixing up gross bookings and recognised revenue. Multiples are usually quoted on recognised revenue, so the wrong base gives a wrong value.
• Reading the result as a price you will actually receive. Debt, cash, growth, margins and negotiating all move a real deal away from a simple revenue multiple.