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Value Drivers · August 2026

The Real Value Drivers: What Actually Moves Your Multiple

Most owners think their multiple is set entirely by their industry. Industry sets the range you're playing in. What moves you within that range is a shorter list than people expect.

Your multiple is the number buyers multiply against your annual profit to set a price — expressed as a multiple of EBITDA (earnings before interest, taxes, depreciation and amortization, or in plain terms, roughly what your business earns before financing and accounting decisions get layered on top).

What actually drives the number

• Recurring revenue. Contracts, subscriptions, service agreements — anything a buyer doesn't have to re-win every year — is the single biggest lever. A buyer isn't really paying for last year's revenue; they're paying for confidence that next year's revenue shows up without a fight.
• Customer concentration. If your top three customers are 40% of revenue, a buyer isn't valuing your business — they're valuing three relationships, one of which might not survive a change of ownership.
• Growth that's already in the numbers. Growth you can point to cleanly in your financials is worth more than growth you're promising is coming.
• Size. You can't fix this overnight, but it compounds everything else — buyer pools widen and financing gets easier as EBITDA climbs.
• Sector. You can't change your industry, but you can change how much your business looks like the best version of that industry, rather than the median.

Why the "going rate" you hear is misleading

Most of the width in that range is about deal size, not deal quality. Private-equity-sponsored transactions — which skew toward larger, more established companies — averaged 7.5x EBITDA in Q3 2025, according to GF Data, up from 6.9x the prior quarter. Broader deal data that includes far more ordinary, owner-run businesses puts the median closer to 3.5x. Main-street transactions tracked by BizBuySell, which skew smaller, averaged closer to 2.7x in mid-2026.

Which segment you're in — mostly a function of your size — sets the range, and that takes years to change. The value drivers above are what move you toward the top or bottom within whatever segment you're already in, which is a faster and more controllable lever than "grow the whole company bigger."