OnwardLesson 3.5
What businesses like yours have sold for
The clearest pattern in sale data is size. Bigger businesses generally sell for higher multiples.
The short version
- The clearest pattern in sale data is size. Bigger businesses generally sell for higher multiples.
- In Pepperdine's 2026 survey, the median business under $500,000 in price sold for about 2.5 times SDE. Businesses over $5 million sold for about 4.25 times.
- A median is the middle. Half of sales came in below it.
- Benchmarks are a starting point for your range, not a price for your business.
What the data shows
Each year Pepperdine University surveys business brokers on the sales they closed. Their 2026 report found median multiples that generally rise with size:
| Price of the business | Median SDE multiple | Median EBITDA multiple |
|---|---|---|
| Under $500,000 | 2.5 times | 3.0 times |
| $500,000 to $1 million | 2.1 times | 2.0 times |
| $1 million to $2 million | 3.0 times | 4.4 times |
| $2 million to $5 million | 3.25 times | 4.0 times |
| Over $5 million | 4.25 times | 7.5 times |
The climb is not perfectly smooth. The survey is small, and one year's results can bounce around in the middle sizes. The pattern across the full range is what to rely on.
Lesson 3.3 explains the difference between SDE and EBITDA. Always compare your business to benchmarks that use the same measure.
What a median tells you, and what it does not
A median is the middle sale. Half sold for more and half for less. The spread around it is wide.
A benchmark describes businesses in general. It does not know your customers, your books or how much the business depends on you. Two businesses the same size can land well apart.
How to use benchmarks well
- Start with size. Find the bracket your business falls into.
- Use the right measure. SDE is usual for businesses earning under about $1 million, and EBITDA above that. Brokers and lenders differ, so check which measure each benchmark uses. Lesson 3.3 explains.
- Adjust for what you know. Step 4, Know what buyers value most, covers what pushes a business above or below the middle.
- Treat the result as a range. Lesson 3.6 explains why.
Where the data comes from
Sale benchmarks come from surveys of brokers and advisors, from universities and from databases of closed transactions that valuation professionals use. They are updated every year or every quarter. Check the date on any number you rely on.
When you are ready to talk to someone
Nobody needs to know you read this. When you are ready, these are the questions to bring.
- For a broker or valuation professional: "What have businesses like mine, at my size, sold for in the last two years?" Listen for: actual closed sales with dates and sources, not asking prices.
- For the same person: "Where would you place my business in that range, and why?" Listen for: reasons specific to your business, including the ones that pull the number down.
Figures from Pepperdine Private Capital Markets Report, 2026. Benchmarks describe what happened in other sales. They do not predict yours.
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