Service Company EBITDA & Valuation Multiples: 2023 Report

Our analysts compiled publicly available data on various service company M&A transactions ranging from Q1 2022 to Q1 2023 to determine average valuation multiples. We present them in the tables below, which cover both EBITDA multiples and revenue multiples and subdivide the data by level of earnings. 

For context on the M&A market for services companies in 2023, see our summary below. 

Service Company Valuation Multiples: EBITDA

Company Type EBITDA Range
$1-3M $3-5M $5-10M
Aviation 6.3x 8.5x 10.1x
Consulting 3.9x 6x 8.4x
Engineering 4.4x 6.8x 9.1x
Entertainment 4.1x 5.8x 8.5x
HVAC 4.8x 7.8x 9x
Insurance 4.6x 6.3x 9.4x
Legal 5.2x 6.9x 10x
Medical 5x 6.6x 8.8x
Pest Control 4.7x 5.9x 7.3x
Security 4.2x 6.4x 7.8x
Staffing/Recruiting 4.3x 6x 7.1x
Transportation 4.5x 5.7x 8x

Service Company Valuation Multiples: Revenue

Company Type Revenue Range
$1-5M $6-10M $10-75M
Aviation 3.1x 4.2x 6x
Consulting 1.4x 2.1x 2.4x
Engineering 2.9x 3.8x 4.9x
Entertainment 1.4x 2.5x 5.1x
HVAC 2.6x 3.5x 4.8x
Insurance 3x 3.7x 4.5x
Legal 2.1x 2.4x 3.4x
Medical 1.8x 3.1x 5x
Pest Control 1.6x 2.3x 3x
Security 2.2x 3.5x 4.8x
Staffing/Recruiting 1.9x 2.3x 2.9x
Transportation 2.4x 2.9x 3.7x

The sections that follow provide an executive-level summary of the current M&A environment for service companies in addition to considerations for selling a service company in these conditions. 

Understanding Service Company Valuations in 2023

Service companies saw volatile ups and downs between 2020 and 2023, with EBITDA multiples ranging from 6-25x during that time, depending on the sector. Some industries have been relatively stable, and have even preserved their 2021 increases, particularly home services. 

For example, midsize HVAC companies are seeing EBITDA multiples in the range of 8x, up more than 20% from 2019, and haven’t seen much fluctuation when interest rates rose in 2022. In contrast, sectors that thrived during the pandemic, such as marketing, saw more fluctuation – from 4-6x in 2019 to 8-11.5x in 2021 to 2.5-5x in 2023.

Despite the variance in service company valuation multiples across industries, we can make the following observations for services as a whole by amalgamating M&A market reports from industries in which service companies make up the majority of the market (e.g., legal, medical, and transportation):

  • Valuation multiples depend on how the company is depicted during the sale process. We have seen service businesses get multiples closer to the range of SaaS businesses if they paint a picture of a more tech-enabled future. For example, an accounting firm that uses AI technology substantively to automate low-level tasks would see a higher valuation multiple.
  • Greater specialization results in higher valuation multiples. Businesses that focus on niche or uncommon audiences are less affected by upstart competitors and often accumulate first-mover advantages. In some cases, there is also greater demand for specialists rather than generalists.
  • The next year will be challenging. While the larger economy continues to experience turbulence, private companies seeking a transaction will have a smaller audience of private equity and strategic acquirers than they did in 2022 or even 2018. However, owners that partner with well-connected M&A advisors or I-banks to run their process are still seeing significant interest.  (Related: The Top M&A Advisory Firms of 2023)


In my experience, selling your company is an overwhelming process, even for veteran business owners who have been dealmaking their entire career. The unpredictability of the macroeconomic environment and the intricacies of dealmaking pile on to an already emotionally taxing event. 

I have sold companies to both private equity firms and strategic buyers and am happy to offer advice to business owners seeking a third-party opinion. I can be reached via the link below or through the main contact page on this website.

Recent Posts