Business Value
What is my business worth?
Where reported transaction data covers your industry, you see what businesses like yours actually sold for, in dollars, applied to your own earnings. The gap between the bottom and the top of that range is decided by what a buyer finds when they check. Where no sold data exists you see what publishers report instead, and where the record cannot support a range it says so rather than estimating. That is the same test Verelume runs against your own records.
Where the industry you pick is covered by reported sold transactions, the figure that leads is what businesses like yours sold for, applied to the earnings you enter. Every figure below it comes from a named publisher, in that publisher’s own measure of earnings, with the date. Publishers scope their figures to a stated range of business sizes. When your earnings fall outside the range a publisher covers, this tool drops that publisher and tells you why.
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This is an exhibit of what the published record says. It is not a certified valuation, an appraisal, a fairness opinion, an investment recommendation, a tax opinion, or a guarantee of sale price. Verelume does not average the publishers or pick between them. Where they disagree, you see the disagreement.
What the estimator does
Select your industry and enter your annual owner earnings. That is the whole form, and it asks for nothing else: no name, no email, no company details.
What comes back leads with the strongest evidence available for your industry. Where reported sold transactions cover it, that is what businesses like yours actually sold for, converted into dollars against the earnings you entered, with the spread between the bottom and the top of that range stated plainly. That spread is the part you can influence. It is decided by what a buyer finds when they check your record.
Where brokers or advisers advertise a figure that does not line up with what sold, you see both, side by side. An advertised multiple is an invitation. A sold multiple is a record of what a buyer paid, and the two are not the same claim.
Where no sold data covers your industry, the tool falls back to what publishers report, and leads with a range only when independent publishers materially agree. Where they disagree, or where the record covers nothing like your business, it states that instead of manufacturing a figure. An honest absence is more useful than a confident guess, because a buyer will not accept the guess either.
Underneath the headline, every time, is the full record: how strong the published evidence actually is, each publisher with its own measure of earnings, its stated scope and its date, and which publishers were set aside because your earnings fall outside the range they cover.
How earnings-based valuation ranges work
A common way to size a private business is to apply a multiple to a measure of its earnings. Published multiples come from records of completed sales in a given industry, and they are expressed as a range rather than a single number. Applying that range to your owner earnings produces an indicative range, not a price. The multiple is a starting point that a real transaction then adjusts up or down.
Why similar earnings can lead to different offers
Earnings are where a buyer starts, not where they finish. Two companies with the same earnings can receive very different offers, because buyers price the risk and durability behind those earnings. A business whose earnings are well documented, and whose value does not rest on a single person, tends to hold up when a buyer looks closely.
What buyers examine beyond the range
The estimated range is a starting point. A buyer also examines:
- Earnings quality, and how well those earnings are documented
- Customer concentration
- Growth, and how durable it is
- Owner dependence and transferability
- The state of contracts and agreements
- Operational risk
- Market conditions
How documentation and diligence readiness affect value
Much of what erodes an offer is avoidable. When a buyer finds unsupported claims, missing evidence, or contradictions in the record, they price in the uncertainty, and that uncertainty comes out of the price. Diligence readiness protects value by finding those gaps first: identifying unsupported claims, missing evidence, and avoidable uncertainty before a buyer does, so they can be fixed or explained rather than discounted.
What the estimate does not represent
The estimate is directional and educational. It is not a certified valuation, an appraisal, a fairness opinion, an investment recommendation, a tax opinion, or a guarantee of sale price. Treat the range as a starting point for a conversation, not a number to rely on.
How Verelume helps you get ready for scrutiny
Verelume is a diligence-readiness platform. It ingests your contracts, financials, and operating records and reports what the record supports, where documents conflict, and where claims lack documentation, so you see what a buyer will see before the buyer sees it. That is the work behind the estimate’s second number, and it is how an owner becomes ready for scrutiny.
Learn more about diligence readiness, or see the ways to engage.
The published record
What the sources say, sector by sector.
We read the publishers behind each vertical and wrote up what they actually report. Where they disagree, the disagreement is the finding. Where the record covers nothing comparable, that is the finding instead.
- Community association managementThree publishers, three different answers, and a disagreement that is more useful than the numbers.
- Dental practicesOne practice, three measures, two buyers. Picking the wrong measure changes the answer by more than any negotiation will.
- HVAC contractorsThe published HVAC ranges barely meet. Which side of the gap you sit on is decided by your contract base, not by the market. Count the sources carefully before you count the agreement.
- Veterinary practicesBoth numbers are real. They describe different earnings and different buyers, and the gap between them is not negotiating room.
- IT services and managed service providersTwo publishers agree. Then one of them shows a spread inside the range that agreement cannot help you with.
- Insurance agenciesOne publisher tells you its numbers are a ceiling. The firms who know what large agencies close at do not publish. The one transaction record available complicates the story rather than confirming it.
- Accounting firmsThe average of nearly two hundred real sales sits below the published band. It sits neatly inside that publisher's own bottom tier.
- Plumbing and electrical contractorsThree sources. The two built from completed sales agree with each other. The one describing what sellers are told sits above both.
- Pest control companiesA multiple with no date is a claim with no time attached, and in a fast moving sector that is not a small omission.
- RestaurantsThe cleanest agreement in everything we checked, attached to the sector where the multiple explains the least.
- Light manufacturingA disagreement about the measure, sitting on top of a disagreement about the number. We published this one wrong ourselves.
Questions
Common questions.
- Is this a business valuation or an appraisal?
- No. It is an exhibit of what the published record says about an industry, not a valuation of your business. Every figure is attributed to the publisher who reported it, with the date. It is not a certified valuation, an appraisal, a fairness opinion, an investment recommendation, a tax opinion, or a guarantee of sale price.
- What information does the estimator ask for?
- Your industry and one earnings figure. Which measure it asks for depends on the industry you pick, because publishers report different industries on different measures. It does not ask for your name, email, company name, phone number, contact information, or a description of your business.
- Why does it sometimes show no range at all?
- Because the evidence does not always support one. Where reported sold transactions cover the industry, the tool leads with what businesses like yours sold for. Where they do not, it leads with a published range only when independent publishers materially agree on the same measure of earnings. Where publishers disagree, or where the record covers nothing comparable to your business, it says so rather than averaging them into a figure no publisher reported. An honest absence is more useful than a confident guess, because a buyer will not accept the guess either.
- Where does the dollar range come from?
- From multiplying the earnings you enter by the multiples a named source reports, and nothing else. Where reported sold transaction data covers your industry, the range comes from what businesses in it actually sold for. The tool shows the arithmetic it used, including the multiples and the source they came from, so the figure can be checked rather than taken on trust. It does not average publishers, blend measures of earnings, or convert between them.
- What is the difference between an asking multiple and a sold multiple?
- An asking multiple is what a business is advertised at. A sold multiple is what a buyer actually paid. They frequently differ, and where a publisher advertises a figure that does not line up with what sold, the tool shows both rather than choosing. An advertised multiple is an invitation. A sold multiple is a record.
- Why do two businesses with similar earnings sell for different amounts?
- Buyers price the risk and durability behind the earnings, not the earnings alone. Customer concentration, owner dependence, transferability, the strength of contracts, and how well the record is documented all move the number.
- How does documentation affect the price?
- When a buyer finds unsupported claims, missing evidence, or contradictions, they price in the uncertainty, and that uncertainty comes out of the price. Diligence readiness protects value by finding those gaps first, so they can be fixed or explained before a buyer sees them.
Ready for scrutiny.
See what your business record supports, where evidence conflicts, and what a buyer may question before diligence begins.