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Valuation logic

This page is the calculator with the cover off. Every table below is rendered from the same code that computes your result, so what you read here is what runs. Engine 3.0.0, released 2026-10-29.

What the calculator does

You answer up to 36 inputs about your business and 6 yes or no questions that buyers treat as deal-breakers. Each input lands in a tier worth 0 to 5 points, weighted by how much buyers care about it. The weighted total becomes an exit readiness score from 0 to 100.

The score picks a multiple from comparable SaaS transactions: 10 rows of deal data, each holding between 12 and 45 closed deals, grouped by revenue bracket and by whether the price was set on revenue, earnings, or owner earnings. The multiple times your revenue or earnings is the estimate. Retention and the deal-breakers can cap it.

Your ARR sets a stage, 1 to 5, from the SaaS Sellability Checklist (version 1.0.0). The stage sets what buyers expect at your size: which rung of each operations ladder, and the benchmarks for growth, churn and contract coverage. A blank input scores zero, so every answer can only raise the score, and the range around the estimate narrows as you answer more.

This is a general estimate for a financial buyer, from the middle of the market. Exceptional businesses sell for exceptional multiples, set in a negotiation, and this calculator will understate them.

Current logic

Engine version 3.0.0, checklist version 1.0.0. Every table below is rendered from the code that computes your result, so it cannot drift from it.

The seven steps

  1. 1

    Stage. Your ARR sets a stage from 1 (under $500K) to 5 ($20M and up). The stage sets the rung each maturity ladder asks for and the benchmark for 3-year CAGR, monthly logo churn, and contract coverage.

  2. 2

    Score. Each of the 36 inputs lands in a tier worth 0 to 5 points. Points are multiplied by the input weight and summed. The total divided by the maximum gives a rank from 0 to 100. A blank input scores 0 against the full denominator, so answering a question can only raise the rank. An input your stage does not ask for leaves the denominator.

  3. 3

    Method. A founder who cannot leave for a month (founder independence rung 0 or 1) is valued on SDE. Loss-making companies are valued on revenue. Companies at 25 percent EBITDA margin or more are valued on earnings. Between 0 and 25 percent the two prices blend in proportion to the margin, so the first dollar of profit never drops the price.

  4. 4

    Comparable deals. The revenue bracket and the method select one row of transaction multiples. Rows under $20M use only targets that made money at sale, because loss-making targets were priced by venture and strategic buyers on factors this calculator cannot see.

  5. 5

    Multiple. The rank maps onto the row geometrically: rank 0 is half the 25th percentile, 25 is the 25th percentile, 50 the median. Revenue and SDE rows end at the 75th percentile at rank 75. EBITDA rows end at the 60th percentile under $5M ARR and the 65th above it, because each EBITDA bracket holds about 20 profitable deals and the top few are strategic sales. When the price blends the earnings way and the revenue way, the revenue share ends at the same percentile.

  6. 6

    Gates. Gross revenue retention caps the multiple: profit way under 70 at 4x earnings or the 25th percentile if lower, 70 to 79 at the 25th percentile, 80 to 89 at the median; revenue way under 70 at 1x revenue with a difficult-to-sell label, 70 to 79 at the median, 80 to 89 midway between the median and the 75th percentile. A deal-breaker answered no adds its own cap. The lowest cap wins.

  7. 7

    Valuation and range. Revenue method: ARR times the multiple. EBITDA and SDE methods: ARR times EBITDA margin times the multiple. The range is plus or minus 10 percent with every input answered and widens to plus or minus 35 percent at 30 percent coverage or less.

Stages

Your ARR sets the stage. The stage sets the rung each ladder asks for and the benchmarks for the three numbers.

StageARRBuyers look at first
1Under $500K ARROwner does everything · No clean financials · Churn unknown
2$500K to $2M ARRFounder-led sales · Revenue reconciliation gaps · Single-person engineering
3$2M to $5M ARRNo second-in-command · Concentration · Security and compliance gaps
4$5M to $20M ARRLeadership gaps · Forecast accuracy · SOC 2 · Customer success depth
5$20M+ ARRAudit quality · Leadership depth · Comparables · Integration risk

Weights

36 inputs, total weight 81. Each input scores 0 to its maximum points, times its weight. A blank input scores 0 against the full denominator. Contract coverage is not asked at stage 1 and leaves the denominator there.

Your company3 inputs · weight 8 of 81 (10%)
Growth and retention7 inputs · weight 20 of 81 (25%)
Profitability and efficiency9 inputs · weight 20 of 81 (25%)
How the business runs6 inputs · weight 13 of 81 (16%)
Product, market and legal11 inputs · weight 20 of 81 (25%)

Maturity ladders

Ten ladders describe how the business runs. You pick the highest rung that is true today. Reaching the rung your stage asks for scores 4 of 4; a lower rung scores in proportion; a higher rung adds nothing, because buyers at your stage do not ask for it.

Financial readinessweight 3 · checklist items F1 F2 F3 F4 F5 F6 F9 F10 F11 F12
Rung buyers ask for
Stage 1rung 1
Stage 2rung 2
Stage 3rung 3
Stage 4rung 4
Stage 5rung 5
  1. 0Informal records
  2. 1Cash-basis books closed quarterlystage 1
  3. 2Accrual books, SaaS chart of accounts, revenue recognized over the termstage 2
  4. 3Monthly close in 30 days, billing reconciles to P&L, CPA-reviewed, 2 to 3 years historystage 3
  5. 4Live dashboard, budget within 10%, 3 years historystage 4
  6. 5Sell-side QoE in the last 12 months or auditedstage 5
Management depthweight 3 · checklist items O3 O5 O6 O7
Rung buyers ask for
Stage 1rung 1
Stage 2rung 1
Stage 3rung 3
Stage 4rung 4
Stage 5rung 4
  1. 0Founder closes every deal and runs every function
  2. 1A second person closes deals; key employees on agreementsstage 1, 2
  3. 2A sales lead owns the pipeline; retention plan for key staff
  4. 3A GM or COO has run operations for 6+ monthsstage 3
  5. 4Leaders for product, engineering, sales, finance, 12+ months; founder in under 10% of dealsstage 4, 5
Founder independenceweight 3 · checklist items O1
Rung buyers ask for
Stage 1rung 1
Stage 2rung 2
Stage 3rung 2
Stage 4rung 3
Stage 5rung 3
  1. 0Revenue or service drops if the founder is away a week
  2. 1The founder can leave for 2 weeksstage 1
  3. 21 monthstage 2, 3
  4. 33 monthsstage 4, 5
  5. 4The business runs without the founder
Operating systemweight 1 · checklist items O4 O8 O9
Rung buyers ask for
Stage 1rung 1
Stage 2rung 2
Stage 3rung 3
Stage 4rung 3
Stage 5rung 3
  1. 0No written roles or processes
  2. 1Every role has a written descriptionstage 1
  3. 2SOPs for every recurring process; org chart current within 90 daysstage 2
  4. 3Hiring and 30-day onboarding documented per rolestage 3, 4, 5
Engineering maturityweight 2 · checklist items O2 P2 P3 P4 P6 P7
Rung buyers ask for
Stage 1rung 1
Stage 2rung 2
Stage 3rung 3
Stage 4rung 3
Stage 5rung 4
  1. 0One person can deploy; no automated tests
  2. 1Version control, deploy script, 2+ people with production access and a runbookstage 1
  3. 2CI/CD; architecture doc and runbooks; license inventory with no copyleftstage 2
  4. 3Tests on critical paths; uptime 99.9%+ tracked; 12-month roadmapstage 3, 4
  5. 4Uptime 99.95%+; a new engineer deploys within a weekstage 5
Security postureweight 2 · checklist items P5
Rung buyers ask for
Stage 1rung 1
Stage 2rung 1
Stage 3rung 2
Stage 4rung 3
Stage 5rung 3
  1. 0No formal controls
  2. 1MFA, tested backups, access controlstage 1, 2
  3. 2Written security policy and annual penetration teststage 3
  4. 3SOC 2 Type IIstage 4, 5
Customer operationsweight 2 · checklist items C2 C4 C5 C6 C7
Rung buyers ask for
Stage 1rung 2
Stage 2rung 3
Stage 3rung 3
Stage 4rung 4
Stage 5rung 4
  1. 0Customer list in a spreadsheet
  2. 1One system holds every customer with MRR, start date, plan, contract
  3. 2Onboarding documented, under 5 founder hours per customerstage 1
  4. 3Named support owner who is not the founder; response time tracked; annual NPSstage 2, 3
  5. 4CS lead with renewal and expansion targets; quarterly NPS 40+stage 4, 5
Revenue operationsweight 1 · checklist items R6 R8 R10 U6
Rung buyers ask for
Stage 1rung 2
Stage 2rung 3
Stage 3rung 3
Stage 4rung 3
Stage 5rung 3
  1. 0Flat pricing, no dunning
  2. 1Automated failed-payment recovery
  3. 22+ pricing tiers or a usage pathstage 1
  4. 3Cohort retention by month with 24 months history; CAC by channelstage 2, 3, 4, 5
Market intelligenceweight 1 · checklist items M1 M3 M4 M5
Rung buyers ask for
Stage 1rung 1
Stage 2rung 1
Stage 3rung 3
Stage 4rung 4
Stage 5rung 4
  1. 0No written customer profile
  2. 1ICP written; 70%+ of new customers matchstage 1, 2
  3. 2Market growth cited from a third-party source
  4. 3Competitor map with 12 months of win ratestage 3
  5. 4Last 10 acquisitions in the category trackedstage 4, 5
Legal readinessweight 2 · checklist items L1 L3 L4 L6 L7 L8
Rung buyers ask for
Stage 1rung 1
Stage 2rung 2
Stage 3rung 4
Stage 4rung 4
Stage 5rung 4
  1. 0Informal
  2. 1Corporation or LLC; clean cap table; founder agreements and customer terms currentstage 1
  3. 2Trademark registered; all domains in a company accountstage 2
  4. 3Top 10 vendor contracts assignable; compliance map with no open gaps
  5. 4Data inventory current within 12 monthsstage 3, 4, 5

Stage benchmarks

Three numbers are scored against a benchmark that moves with your stage. Higher is better: at or above the benchmark 4 points, 75 percent of it 3, half 2, above zero 1. Lower is better, for logo churn: at or below 4, 1.5 times 3, 2 times 2, 3 times 1.

3-year ARR CAGRweight 3 · higher is better · item R2
Benchmark
Stage 140%
Stage 230%
Stage 320%
Stage 420%
Stage 515%
Monthly logo churnweight 2 · lower is better · item R5
Benchmark
Stage 15%
Stage 25%
Stage 33%
Stage 42%
Stage 51.5%
Annual or multi-year contract coverageweight 2 · higher is better · item R7
Benchmark
Stage 1not asked
Stage 230%
Stage 350%
Stage 460%
Stage 570%

Deal-breakers

Six yes or no questions. Only a stated no acts: it caps the multiple. Not sure and yes leave the number alone. Caps stack with the retention gate; the lowest cap wins.

QuestionGates at stagesCap when noItem
No open litigation, claims, or regulatory issues1, 2, 3, 4, 525th percentile of the comps rowL5
Every code author signed an IP assignment1, 2, 3, 4, 525th percentile of the comps rowL2
Tax filings current; all revenue in the books1, 2, 3, 4, 525th percentile of the comps rowF7
No flat or down year in the last 31, 2, 3the under-70 retention cap: 1x revenue, or 4x earnings, or p25 if lowerR2
No cash-flow crisis in 24 months; 3 months cash on hand1, 2, 3, 4, 5median of the comps rowF8
Largest customers on contracts that assign on change of control2, 3, 4, 5median of the comps rowC3

Retention gate

Gross revenue retention caps the multiple before anything else. Fixed caps under 70: 1x revenue, 4x EBITDA or SDE.

GRRRule
under 70profit way: cap at the smaller of 4x earnings and the p25 multiple. Revenue way: cap at 1x revenue (or p25 if lower), labelled difficult to sell
70 to 79profit way: cap at the p25 multiple. Revenue way: cap at the median
80 to 89profit way: cap at the median multiple. Revenue way: cap midway between the median and p75
90 and upno cap

Multiple ceiling

Revenue and SDE rows end at the 75th percentile. EBITDA rows end at the 60th percentile at stages 1 to 3 and the 65th at stages 4 and 5, and so does the revenue share inside a margin blend. Each EBITDA bracket holds under 30 profitable deals and the top few are strategic sales where the buyer paid for something other than earnings. Exceptional SaaS businesses do sell for exceptional multiples; those prices are set in a negotiation, not by a benchmark, and this calculator will understate them.

BracketDealsMedian75thCeiling, stages 1 to 3Ceiling, stages 4 and 5
$0 to $2M206.29x13.00x8.41x9.72x
$2M to $5M216.72x13.89x8.98x10.39x
$5M to $20M1710.68x18.60x13.33x14.90x
$20M to $50M22 (unverified)18.20x30.10x22.26x24.61x

Comparable deals

BVR DealStats, NAICS 513210, sale dates 2015-01 to 2025-01. Rows under $20M use only targets that made money at sale.

BracketMethodP25MedianP75DealsFilter
$0 to $2MRevenue1.31x1.80x2.91x42targets with EBITDA above 0, or operating profit above 0 when EBITDA is not reported
$0 to $2MEBITDA3.49x6.29x13.00x20targets with EBITDA margin of 10% or more
$0 to $2MSDE2.28x3.02x4.14x28targets with SDE above 0
$2M to $5MRevenue1.57x2.18x3.84x33targets with EBITDA above 0, or operating profit above 0 when EBITDA is not reported
$2M to $5MEBITDA4.98x6.72x13.89x21targets with EBITDA margin of 10% or more
$2M to $5MSDE3.82x4.50x6.13x12targets with SDE above 0
$5M to $20MRevenue1.52x2.45x4.10x31targets with EBITDA above 0, or operating profit above 0 when EBITDA is not reported
$5M to $20MEBITDA7.89x10.68x18.60x17targets with EBITDA margin of 10% or more
$20M to $50MRevenue2.50x3.80x7.50x45all deals, not yet recomputed from raw data (unverified)
$20M to $50MEBITDA10.50x18.20x30.10x22all deals, not yet recomputed from raw data (unverified)

Reading the score

The score is a rank against the full set of inputs, not a grade on the ones you answered. Two companies with the same answers get the same score whatever else they left blank.

ScoreRatingWhat it means
90 and upElite exit readyTop tier on nearly every input. The multiple sits at the ceiling of the comparable deals.
80 to 89Premium exitStrong across the board with one or two gaps. Buyers compete for this profile.
70 to 79Strong exitAbove the median deal. The concern list names what separates this from premium.
50 to 69Market exitPriced around the median of comparable deals. Retention or operations usually hold it here.
30 to 49Needs improvementBelow the median. Several inputs are weak or unanswered.
0 to 29High riskFew inputs answered or several critical ones weak. Buyers discount what they cannot verify.

Sources

Transactions. BVR DealStats, NAICS 513210, sale dates 2015-01 to 2025-01. Raw exports pulled 2025-01-06, held in the Livmo Drive folder "BVR data - Software Publishers Transactions". Quartiles recomputed by scripts/analysis/bvr-quartiles.py in the app repository.

Profitability filter. Brackets under $20M use targets with EBITDA above 0 (revenue multiples), EBITDA margin of 10 percent or more (EBITDA multiples), or SDE above 0 (SDE multiples). 46 of the 51 deals above the old 75th percentile were loss-making and are excluded.

Sellability checklist. The SaaS Sellability Checklist, version 1.0.0, from Livmo's open exit-engineering repository on GitHub. A pinned copy lives in the app repository at data/sellability-checklist.json. Its 70 items map onto the ladders, numbers, deal-breakers and existing sliders above. The repository holds the checklist, the financial reporting guide, and the other free resources for founders who want to engineer an exit.

Planned

  • Public SaaS multiples with a private-company discount, blended with the transaction data at stated weights.
  • A raw transaction export for the $20M to $50M bracket, so it can be filtered by profitability like the other brackets.

Update log

Every change to the scoring and valuation logic, newest first.

v3.0.0 2026-10-29

  • The SaaS Sellability Checklist (version 1.0.0) joins the score. 48 of its items collapse into 10 maturity ladders, 3 into stage-benchmarked numbers (3-year CAGR, monthly logo churn, contract coverage), and 6 into deal-breaker questions. Financial quality, management team and owner dependence become ladders.
  • Your ARR sets a stage, 1 to 5. Each ladder and number is scored against what buyers ask for at that stage. Reaching the required rung scores full points; a higher rung adds nothing.
  • A blank input still scores 0 against the full denominator, as in v2. The denominator grows from 61 to 81 weighted inputs, so a saved calculation with the new inputs unanswered shows a lower score until they are answered.
  • A deal-breaker answered "no" caps the multiple: open litigation, missing IP assignments, or tax filings not current at the 25th percentile; a cash-flow crisis or non-assignable customer contracts at the median; a flat or down year at stages 1 to 3 at the under-70 retention cap. "Not sure" leaves the number alone.
  • The EBITDA multiple curve now ends at the 60th percentile of comparable deals under $5M ARR and the 65th above it, instead of the 75th. Each EBITDA bracket holds 17 to 22 profitable deals, and the top few are strategic sales where the buyer paid for something other than earnings. When the price is a blend of the earnings way and the revenue way (0 to 25 percent margin), the revenue share ends at the same percentile. Pure revenue pricing, for loss-making companies, keeps the 75th. Exceptional SaaS businesses do sell for exceptional multiples; those prices are set in a negotiation, not by a benchmark, and this calculator will understate them.
  • The range width follows coverage: plus or minus 10 percent with every input answered, widening to plus or minus 35 percent at 30 percent coverage or less. The result lists up to 5 concerns, deal-breakers first, each with why buyers care and what to strengthen.

v2.1.0 2026-10-14

  • The revenue way and the profit way blend between 0 and 25 percent EBITDA margin. At 0 the price is all revenue-based, at 25 all profit-based. This removes the cliff at the first dollar of profit.
  • The growth-over-50-percent rule is gone. Loss-making companies are priced on revenue; profitable ones on earnings, with the blend in between.
  • The retention gate is softer on the revenue way: under 70 caps at 1x revenue with a difficult-to-sell label, 70 to 79 at the median, 80 to 89 midway between median and p75. The profit way keeps the v2.0 bands.
  • When the revenue way is in use and GRR or NRR is blank, the range widens from plus or minus 15 percent to plus or minus 35 percent.

v2.0.0 2026-10-11

  • Comparable transactions now use profitable targets only. Loss-making venture and strategic exits set the old 75th percentile and are excluded.
  • The multiple is capped at the 75th percentile of comparable deals and interpolated geometrically between quartiles.
  • A retention gate caps the multiple when gross revenue retention is under 90: under 70 at 1x revenue or 4x earnings (or p25 if lower), 70 to 79 at p25, 80 to 89 at the median.
  • Weights: GRR 2 to 5, company age 1 to 3, market attractiveness 2 to 1. Total weight 54 to 61 over 26 metrics.
  • New input: consecutive years profitable, weight 3, forced to 0 when EBITDA margin is at or below 0.
  • Unprofitable companies are valued on revenue from the profitable-target table instead of returning $0, with a note about venture exits.

v1.0.0 2025-07-24

  • Original engine: weighted tier score mapped linearly onto all-deal BVR quartiles with extrapolation to 1.25 times the 75th percentile.