Most owners don't know their SDE \u2014 the real economic benefit their business generates for them. Taxable profit and SDE are very different numbers. SDE is what buyers actually use to value your business.
Why SDE matters: Your taxable profit might be $80,000, but after adding back your salary, benefits, depreciation, and one-time expenses, your SDE might be $425,000. That's the number buyers care about \u2014 it represents the total economic benefit the business provides to an owner.
Use numbers from your most recent full fiscal year. Enter 0 for any field that doesn't apply.
Your bottom-line profit after all expenses and taxes.
What you pay yourself. Added back because a new owner sets their own salary.
Interest on business loans. Added back as financing-specific.
Income taxes paid by the business. Added back to show pre-tax earnings.
Non-cash expense. Added back.
Non-cash expense. Added back.
Personal benefits paid through the business.
Travel, meals, entertainment that are personal in nature.
Lawsuit settlements, emergency repairs, relocation, etc.
Any other expenses a new owner would not incur.
Your estimated SDE (Seller's Discretionary Earnings)
$0
This is the total economic benefit your business generates for you as the owner \u2014 the number buyers use to value your business.
SDE is the starting point. Your business value depends on your SDE multiplied by a risk-adjusted multiple. Use the full valuation tool to get your preliminary value range.
Get my preliminary value range