The Science of SaaS Valuation
Deep dive into the sophisticated methodology behind enterprise software valuations
The Science of SaaS Valuation
Understanding how sophisticated algorithms and market data combine to determine your company's worth. This isn't just math—it's the intersection of finance, technology, and market psychology.
Overview
What This Calculator Does
Our SaaS valuation calculator uses a sophisticated scoring system that evaluates your business across 21+ critical metrics, comparing you to thousands of real exit transactions. It's not just about numbers—it's about understanding your position in the market and identifying specific areas for improvement.
Why It Matters
Understanding your valuation isn't just about knowing what you're worth today. It's about identifying the specific drivers that will maximize your exit value tomorrow. Every metric improvement can mean millions more at the closing table.
Calculator Methodology
Data Collection
We gather your business metrics across 21+ key performance indicators
Market Comparison
Compare your metrics against thousands of real exit transactions
Scoring & Ranking
Calculate percentile rankings and identify improvement opportunities
Valuation Calculation
Apply market multiples to determine your estimated company value
Valuation Methods
SDE Multiple
For businesses under $2M revenue, owner-operated
EBITDA Multiple
For businesses $5M-$150M with defined teams
Revenue Multiple
For high-growth companies reinvesting in growth
Metric Calculations
Scoring Methodology
Example: ARR Growth Rate
Score Interpretation
Elite
Top 10% of SaaS companies
Excellent
Top 25% of SaaS companies
Good
Top 50% of SaaS companies
Fair
Bottom 50% of SaaS companies
Poor
Bottom 25% of SaaS companies
Improvement Strategies
High-Impact Areas
ARR Growth Rate
Improving from 20% to 40% can add 2-3x to your multiple
Customer Retention
Moving from 80% to 95% GRR can increase value by 50%+
Team Structure
Reducing owner dependence can double your multiple