EBITDA Multiples by Industry & Company Size: 2024 Report

Posted September 28, 2023

Updated September 28, 2023

Our team recently conducted a meta-analysis of EBITDA multiples for small-to-midsized private businesses of <$250M in revenue, parsing the data by industry and company size. We drew from research published over the past 18 months (Q2 2022-Q4 2023) in M&A and private equity publications in order to get an accurate picture of the current marketplace. The tables below reflect an accurate picture of private company valuations in today’s M&A environment.

Apart from industry and EBITDA range, real-world valuations depend principally on 8 factors:

Recurring revenue
Revenue growth over last 12 months
Key employee turnover
Profit margin
Competitive advantages
Customer concentration
Strength of management team
Growth opportunities

The following tables represent EBITDA multiple averages; achieving these multiples depends on the investor’s weighting of the above factors, as well as the business’ strategic fit with the acquirer or portfolio.

NOTE: If you’re exploring selling your business, see our report on the Top M&A Advisory Firms in the US.

To make the data more meaningful, we’ve broken it down by two further dimensions: revenue growth in the last 12 months and key employee turnover. In addition to EBITDA range and recurring revenue, these tend to be the strongest considerations for acquirers when they’re evaluating a company. Definitions of “high” and “low” in the two categories vary based on acquirer and company size, but a healthy median for last 12 months revenue growth is ~25% and key employee turnover rate is ~5%.

$0-1M EBITDA Companies

EBITDA Multiples By Industry for $0-1M EBITDA Companies

Industry	Key Employee Turnover	Last 12 Months Revenue Growth		Notes
Industry	Key Employee Turnover	Low	High	Notes
Addiction Treatment	High	1.2x	2.6x	Higher multiples for more in-demand specialties, e.g. autism Residential multiples are ~20% higher than outpatient If the treatment center’s real estate is part of the deal, there is added complexity in calculating the valuation
Addiction Treatment	Low	1.6x	4.1x
Aerospace & Defense	High	3.8x	6.6x	Multiples hit historic highs in 2021-2022 driven by military needs related to the Russia-Ukraine war Space security & space tourism companies are fastest growing
Aerospace & Defense	Low	4.1x	8x
Automotive	High	Non-recurring Revenue: 1.8x Recurring Revenue: 2.3x	Non-recurring Revenue: 3.5x Recurring Revenue: 4.1x	Coming off years of supply shortages, Automotive OEMs are commanding the highest multiples
Automotive	Low	Non-recurring Revenue: 2.7x Recurring Revenue: 2.8x	Non-recurring Revenue: 4.5x Recurring Revenue: 5x
Aviation	High	Non-recurring Revenue: 2.4x Recurring Revenue: 2.7x	Non-recurring Revenue: 3.2x Recurring Revenue: 4.2x	Record customer acquisition during 2020 & 2021 pushed aviation company multiples ~15% higher than pre-pandemic, but recession effects through Q4 2023 tempered that growth, with average multiples now ~8.5% below 2019 levels Businesses where aircraft are owned are closing slower, and at a slightly lower multiple, than businesses involved in the leasing and sale of aircraft
Aviation	Low	Non-recurring Revenue: 2.6x Recurring Revenue: 2.8x	Non-recurring Revenue: 4.1x Recurring Revenue: 4.5x
B2B SaaS	High	Non-recurring Revenue: 2.6x Recurring Revenue: 2.8x	Non-recurring Revenue: 4.4x Recurring Revenue: 6.3x	B2B SaaS multiples decreased for $0m-$1m EBITDA companies when interest rates rose in May ’22 and again when equity markets declined in late 2022 – early 2023 Strong interest in AI, specifically GPT-4 and other advanced LLMs, portends that businesses that make use of machine learning technology will see higher valuation multiples Smaller B2B SaaS companies may be valued based on Seller Discretionary Income (SDE) rather than EBITDA, but the two are comparable See our report on SaaS valuation multiples
B2B SaaS	Low	Non-recurring Revenue: 2.7x Recurring Revenue: 3.1x	Non-recurring Revenue: 4.9x Recurring Revenue: 8.2x
Biotech	High	Non-recurring Revenue: 3.6x Recurring Revenue: 4.4x	Non-recurring Revenue: 5.8x Recurring Revenue: 6.7x	Biotech companies often aren’t valued based on EBITDA due to the length of the approval process, high cost of development & binary nature of outcome; risk-adjusted NPV or comparables to similar companies are used
Biotech	Low	Non-recurring Revenue: 4x Recurring Revenue: 4.8x	Non-recurring Revenue: 6.4x Recurring Revenue: 7.9x
Commercial Insurance	High	Non-recurring Revenue: 3x Recurring Revenue: 3.3x	Non-recurring Revenue: 3.9x Recurring Revenue: 4.8x	As interest rates rose in Q2 & Q3 2022, PE firms had more limited access to capital, tempering the higher range of multiples commercial insurance firms saw in 2020 & 2021, which had been 40-50% above 2010s levels; however, as of Q4 2023, there is still plenty of M&A opportunity from larger acquirers & PE shops
Commercial Insurance	Low	Non-recurring Revenue: 3.4x Recurring Revenue: 3.8x	Non-recurring Revenue: 4.4x Recurring Revenue: 5.7x
Construction	High	Non-recurring Revenue: 1.5x Recurring Revenue: 2.1x	Non-recurring Revenue: 3.2x Recurring Revenue: 3.5x	EBITDA multiples in construction skew low due to non-recurring revenue and high costs, but when automation (e.g. modular, prefab) and software play a larger role, multiples rise
Construction	Low	Non-recurring Revenue: 2x Recurring Revenue: 2.7x	Non-recurring Revenue: 3x Recurring Revenue: 4.3x
Cybersecurity	High	Non-recurring Revenue: 2.8x Recurring Revenue: 3.3x	Non-recurring Revenue: 4.9x Recurring Revenue: 6.4x	Spurred by the shift to online work, M&A activity in cybersecurity peaked between Q4 2021 and Q1 2023, led by PE & VC firms, with a small number of strategic acquisitions; multiples are slightly lower as of Q4 2023 but remain strong despite deal flow having slowed down
Cybersecurity	Low	Non-recurring Revenue: 3.1x Recurring Revenue: 3.8x	Non-recurring Revenue: 5.1x Recurring Revenue: 7.4x
eCommerce	High	Non-recurring Revenue: 3.1x Recurring Revenue: 4.2x	Non-recurring Revenue: 4.8x Recurring Revenue: 6.2x	E-commerce valuations remain strong post-pandemic, with the main limiters being supply chain challenges and “Amazon Fear”; niche specialists getting highest multiples
eCommerce	Low	Non-recurring Revenue: 4.2x Recurring Revenue: 5.5x	Non-recurring Revenue: 5.6x Recurring Revenue: 7.1x
Engineering	High	4.6x	7.6x	Engineering firms have non-recurring cash flow & thus see lower EBITDA multiples; exception is firms with long-term government contracts (provided customer concentration is <40%)
Engineering	Low	5.3x	10.7x
Entertainment	High	Non-recurring Revenue: 2x Recurring Revenue: 2.8x	Non-recurring Revenue: 4.4x Recurring Revenue: 5.5x	Entertainment is a particularly asymmetrical industry in terms of multiples, as a small amount of content receives almost all of consumers’ attention & thus receives the highest M&A interest; thus, go big or go home
Entertainment	Low	Non-recurring Revenue: 2.2x Recurring Revenue: 3.3x	Non-recurring Revenue: 4.4x Recurring Revenue: 5.9x
Environmental & Clean Energy	High	Non-recurring Revenue: 2.3x Recurring Revenue: 2.6x	Non-recurring Revenue: 4.1x Recurring Revenue: 4.9x	Environmental & clean energy valuations have remained steady through Q4 2023, rising at a slower pace than other industries, with solar, electronics recycling, and waste-to-energy outpacing more traditional businesses in this sector
Environmental & Clean Energy	Low	Non-recurring Revenue: 2.8x Recurring Revenue: 3.2x	Non-recurring Revenue: 5.5x Recurring Revenue: 6.7x
Financial Services	High	Non-recurring Revenue: 1.8x Recurring Revenue: 2.1x	Non-recurring Revenue: 3x Recurring Revenue: 3.6x	Financial advisories and other services firms saw modest increases in EBITDA multiples in 2020-2022, which remained relatively unchanged through Q3 2023 despite less deal flow
Financial Services	Low	Non-recurring Revenue: 2x Recurring Revenue: 2.3x	Non-recurring Revenue: 3.1x Recurring Revenue: 3.8x
Fintech	High	Non-recurring Revenue: 3.4x Recurring Revenue: 3.5x	Non-recurring Revenue: 5.7x Recurring Revenue: 8.2x	Fintech was one of top beneficiaries of pandemic-induced behavior change. Alternative lending, payment platforms, and cryptocurrency businesses saw the greatest rise in valuations. While valuations took a hit after interest rates rose in May 2022, they are still above historic benchmarks
Fintech	Low	Non-recurring Revenue: 3.7x Recurring Revenue: 4.4x	Non-recurring Revenue: 6.4x Recurring Revenue: 9.5x
Healthcare	High	Non-recurring Revenue: 2.8x Recurring Revenue: 3x	Non-recurring Revenue: 3.8x Recurring Revenue: 4.3x	Healthcare multiples are increasing, particularly for mid-sized businesses, led by home-based services and high-end professional services (e.g. concierge practices)
Healthcare	Low	Non-recurring Revenue: 3x Recurring Revenue: 3.2x	Non-recurring Revenue: 4.1x Recurring Revenue: 4.7x
Higher Education	High	N/A	N/A	Colleges that serve students in person are finally rebounding post-Covid; multiples have seen slight growth over previous years, with organizations offering specialty degrees seeing the highest multiples
Higher Education	Low	3.1x	5x
Hotels & Resorts	High	4.4x	5.9x	Hospitality is booming post-pandemic, but competition from short-term rentals remains fierce, leaving valuations steady in the 8x-13x range
Hotels & Resorts	Low	5.3x	7.4x
HVAC	High	Non-recurring Revenue: 1.2x Recurring Revenue: 2x	Non-recurring Revenue: 2.9x Recurring Revenue: 3.2x	HVAC multiples were flat through Q1 2022, except with companies in growing areas that have recurring maintenance contracts; but jumped significantly in late 2022 and remain one of the more significant inceases in multiples for an industry through Q4 2023
HVAC	Low	Non-recurring Revenue: 2.4x Recurring Revenue: 2.5x	Non-recurring Revenue: 3.5x Recurring Revenue: 3.9x
Industrial IOT	High	Non-recurring Revenue: 4.4x Recurring Revenue: 4.9x	Non-recurring Revenue: 7x Recurring Revenue: 8.2x	Multiples continue to rise in industrial automation & IoT given the imperative of digital transformation and the appetite of larger acquirers to snap up sub-$100M businesses
Industrial IOT	Low	Non-recurring Revenue: 5.3x Recurring Revenue: 5.7x	Non-recurring Revenue: 8.7x Recurring Revenue: 10x
IT & Managed Services	High	Non-recurring Revenue: 2.6x Recurring Revenue: 3x	Non-recurring Revenue: 4.9x Recurring Revenue: 5.9x	There is strong private equity demand among for MSPs due to the recurring revenue model, but a fragmented space and lack of scale make EBITDA multiples highly variable
IT & Managed Services	Low	Non-recurring Revenue: 3.8x Recurring Revenue: 4.2x	Non-recurring Revenue: 5.7x Recurring Revenue: 7.1x
Law Firms & Legal Services	High	Non-recurring Revenue: 1.9x Recurring Revenue: 2.4x	Non-recurring Revenue: 2.6x Recurring Revenue: 3.7x	EBITDA multiples for law firms haven’t changed much in 2023, with most M&A appetite going to legal tech companies that incorporate generative AI & recurring cash flow businesses
Law Firms & Legal Services	Low	Non-recurring Revenue: 2.3x Recurring Revenue: 2.8x	Non-recurring Revenue: 3x Recurring Revenue: 4.3x
Manufacturing	High	Non-recurring Revenue: 2.7x Recurring Revenue: 3x	Non-recurring Revenue: 3.8x Recurring Revenue: 4.1x	Small-to-midsize manufacturing company EBITDA multiples have risen slightly in 2023 but largely reverted to the pre-2020 mean of 6-8x – higher for firms with advanced tech such as 3D printing
Manufacturing	Low	Non-recurring Revenue: 3.4x Recurring Revenue: 3.7x	Non-recurring Revenue: 4.5x Recurring Revenue: 5.4x
Oil & Gas	High	Non-recurring Revenue: 3x Recurring Revenue: 3.4x	Non-recurring Revenue: 3.8x Recurring Revenue: 4.3x	Generally, EBITDA multiples in oil & gas haven’t recovered to pre-pandemic levels, with diversified oilfield services & equipment firms faring better than oilfield equipment manufacturers, oilfield services, and contract drilling firms
Oil & Gas	Low	Non-recurring Revenue: 3.1x Recurring Revenue: 3.7x	Non-recurring Revenue: 4.2x Recurring Revenue: 4.7x
Pharmaceutical	High	4.3x	6.9x	Most M&A activity in 2021-2022 targeted smaller pharmaceuticals companies with revenues under $150M; however, EBITDA multiple trends are somewhat opaque with few deals and little financial disclosure from private companies
Pharmaceutical	Low	5.6x	8.4x
Real Estate	High	Non-recurring Revenue: 1.9x Recurring Revenue: 2.1x	Non-recurring Revenue: 3.2x Recurring Revenue: 3.9x	In 2022, the highest multiples in real estate come from companies with recurring revenue in growing areas, a guaranteed income stream, or market dominance; lower multiples from from real estate services and development firms
Real Estate	Low	Non-recurring Revenue: 2.3x Recurring Revenue: 2.6x	Non-recurring Revenue: 3.4x Recurring Revenue: 4.1x
Software Development	High	Non-recurring Revenue: 2.1x Recurring Revenue: 2.8x	Non-recurring Revenue: 3.4x Recurring Revenue: 4.1x	Software development firms follow the valuation patterns of other professional services firms but trend higher than legal services and MSPs, for instance; multiples have increased slightly since 2020, averaging 3.7x
Software Development	Low	Non-recurring Revenue: 2.5x Recurring Revenue: 3.2x	Non-recurring Revenue: 3.8x Recurring Revenue: 4.4x
Staffing & Recruiting	High	Non-recurring Revenue: 2.7x Recurring Revenue: 3.2x	Non-recurring Revenue: 4.4x Recurring Revenue: 4.9x	Staffing & Recruiting firms see higher multiples than other services firms because of the consistency of their revenue, with firms that work with enterprises seeing the top end (~6x)
Staffing & Recruiting	Low	Non-recurring Revenue: 3x Recurring Revenue: 3.5x	Non-recurring Revenue: 5x Recurring Revenue: 5.5x
Transportation & Logistics	High	3.1x	4.8x	Logistics & transportation companies have seen their multiples grow, then stagnate, over the past 2 years, depending on how they’ve fared with supply chain shortages; best sector has been LTL & worst asset-based truckload
Transportation & Logistics	Low	3.5x	5.5x

$1-3M EBITDA Companies

EBITDA Multiples By Industry for $1-3M EBITDA Companies

Industry	Key Employee Turnover	Last 12 Months Revenue Growth		Notes
Industry	Key Employee Turnover	Low	High	Notes
Addiction Treatment	High	2x	4.5x	Higher multiples for more in-demand specialties, e.g. autism Residential multiples are ~20% higher than outpatient If the treatment center’s real estate is part of the deal, there is added complexity in calculating the valuation
Addiction Treatment	Low	2.7x	7x
Aerospace & Defense	High	6.6x	11.4x	Multiples hit historic highs in 2021-2022 driven by military needs related to the Russia-Ukraine war Space security & space tourism companies are fastest growing
Aerospace & Defense	Low	7.1x	13.8x
Automotive	High	Non-recurring Revenue: 3.1x Recurring Revenue: 3.9x	Non-recurring Revenue: 6x Recurring Revenue: 7.1x	Coming off years of supply shortages, Automotive OEMs are commanding the highest multiples
Automotive	Low	Non-recurring Revenue: 4.6x Recurring Revenue: 4.8x	Non-recurring Revenue: 7.7x Recurring Revenue: 8.6x
Aviation	High	Non-recurring Revenue: 4.1x Recurring Revenue: 4.6x	Non-recurring Revenue: 5.5x Recurring Revenue: 7.3x	Record customer acquisition during 2020 & 2021 pushed aviation company multiples ~15% higher than pre-pandemic, but recession effects through Q4 2023 tempered that growth, with multiples now ~8.5% below 2019 levels Businesses where aircraft are owned are closing slower, and at a slightly lower multiple, than businesses involved in the leasing and sale of aircraft
Aviation	Low	Non-recurring Revenue: 4.5x Recurring Revenue: 4.9x	Non-recurring Revenue: 7.1x Recurring Revenue: 7.8x
B2B SaaS	High	Non-recurring Revenue: 4.5x Recurring Revenue: 4.8x	Non-recurring Revenue: 7.5x Recurring Revenue: 10.9x	B2B SaaS multiples decreased for $3m-$10m EBITDA companies when interest rates rose in May ’22 and again when equity markets declined in late 2022 – early 2023 Strong interest in AI, specifically GPT-4 and other advanced LLMs, portends that businesses that make use of machine learning technology will see higher multiples Smaller B2B SaaS companies may be valued based on Seller Discretionary Income (SDE) rather than EBITDA, but the two are comparable See our report on SaaS valuation multiples
B2B SaaS	Low	Non-recurring Revenue: 4.7x Recurring Revenue: 5.3x	Non-recurring Revenue: 8.5x Recurring Revenue: 14.1x
Biotech	High	Non-recurring Revenue: 6.2x Recurring Revenue: 7.6x	Non-recurring Revenue: 10.4x Recurring Revenue: 11.6x	Biotech companies often aren’t valued based on EBITDA due to the length of the approval process, high cost of development & binary nature of outcome; risk-adjusted NPV or comparables to similar companies are used
Biotech	Low	Non-recurring Revenue: 6.9x Recurring Revenue: 8.3x	Non-recurring Revenue: 11.1x Recurring Revenue: 13.7x
Commercial Insurance	High	Non-recurring Revenue: 5.1x Recurring Revenue: 5.7x	Non-recurring Revenue: 6.8x Recurring Revenue: 8.2x	As interest rates rose in Q2 & Q3 2022, PE firms had more limited access to capital, tempering the higher range of multiples commercial insurance firms saw in 2020 & 2021, which had been 40-50% above 2010s levels; however, as of Q4 2023, there is still plenty of M&A opportunity from larger acquirers & PE shops
Commercial Insurance	Low	Non-recurring Revenue: 5.9x Recurring Revenue: 6.5x	Non-recurring Revenue: 7.5x Recurring Revenue: 9.9x
Construction	High	Non-recurring Revenue: 2.5x Recurring Revenue: 3.6x	Non-recurring Revenue: 5.5x Recurring Revenue: 6x	EBITDA multiples in construction skew low due to non-recurring revenue and high costs, but when automation (e.g. modular, prefab) and software play a larger role, multiples rise
Construction	Low	Non-recurring Revenue: 3.4x Recurring Revenue: 4.7x	Non-recurring Revenue: 5.1x Recurring Revenue: 7.4x
Cybersecurity	High	Non-recurring Revenue: 4.9x Recurring Revenue: 5.7x	Non-recurring Revenue: 8.4x Recurring Revenue: 11.1x	Spurred by the shift to online work, M&A activity in cybersecurity peaked between Q4 2021 and Q1 2023, led by PE & VC firms, with a small number of strategic acquisitions; multiples are slightly lower as of Q4 2023 but remain strong despite deal flow having slowed down
Cybersecurity	Low	Non-recurring Revenue: 5.3x Recurring Revenue: 6.5x	Non-recurring Revenue: 8.8x Recurring Revenue: 12.8x
eCommerce	High	Non-recurring Revenue: 5.4x Recurring Revenue: 7.3x	Non-recurring Revenue: 8.3x Recurring Revenue: 10.7x	E-commerce valuations remain strong post-pandemic, with the main limiters being supply chain challenges and “Amazon Fear”; niche specialists getting highest multiples
eCommerce	Low	Non-recurring Revenue: 7.2x Recurring Revenue: 9.4x	Non-recurring Revenue: 9.6x Recurring Revenue: 12.3x
Engineering	High	3.1x	5.2x	Engineering firms have non-recurring cash flow & thus see lower EBITDA multiples; exception is firms with long-term government contracts (provided customer concentration is <40%)
Engineering	Low	3.6x	7.3x
Entertainment	High	Non-recurring Revenue: 3.5x Recurring Revenue: 4.8x	Non-recurring Revenue: 7.6x Recurring Revenue: 9.5x	Entertainment is a particularly asymmetrical industry in terms of multiples, as a small amount of content receives almost all of consumers’ attention & thus receives the highest M&A interest; thus, go big or go home
Entertainment	Low	Non-recurring Revenue: 3.8x Recurring Revenue: 5.7x	Non-recurring Revenue: 7.6x Recurring Revenue: 10.1x
Environmental & Clean Energy	High	Non-recurring Revenue: 3.9x Recurring Revenue: 4.5x	Non-recurring Revenue: 7.1x Recurring Revenue: 8.4x	Environmental & clean energy valuations have remained steady through Q2 2023, rising at a slower pace than other industries, with solar, electronics recycling, and waste-to-energy outpacing more traditional businesses in this sector
Environmental & Clean Energy	Low	Non-recurring Revenue: 4.9x Recurring Revenue: 5.6x	Non-recurring Revenue: 9.4x Recurring Revenue: 11.6x
Financial Services	High	Non-recurring Revenue: 3.1x Recurring Revenue: 3.7x	Non-recurring Revenue: 5.1x Recurring Revenue: 6.2x	Financial advisories and other services firms saw modest increases in EBITDA multiples in 2020-2022, which remained relatively unchanged through Q2 2023 despite less deal flow
Financial Services	Low	Non-recurring Revenue: 3.5x Recurring Revenue: 3.9x	Non-recurring Revenue: 5.3x Recurring Revenue: 6.6x
Fintech	High	Non-recurring Revenue: 5.8x Recurring Revenue: 6.1x	Non-recurring Revenue: 9.9x Recurring Revenue: 14.1x	Fintech was one of top beneficiaries of pandemic-induced behavior change. Alternative lending, payment platforms, and cryptocurrency businesses saw the greatest rise in valuations. While valuations took a hit after interest rates rose in May 2022, they are still above historic benchmarks
Fintech	Low	Non-recurring Revenue: 6.4x Recurring Revenue: 7.5x	Non-recurring Revenue: 11.6x Recurring Revenue: 16.4x
Healthcare	High	Non-recurring Revenue: 4.8x Recurring Revenue: 5.2x	Non-recurring Revenue: 6.6x Recurring Revenue: 7.4x	Healthcare multiples are increasing, particularly for mid-sized businesses, led by home-based services and high-end professional services (e.g. concierge practices)
Healthcare	Low	Non-recurring Revenue: 5.1x Recurring Revenue: 5.6x	Non-recurring Revenue: 7.1x Recurring Revenue: 8.1x
Higher Education	High	N/A	N/A	Colleges that serve students in person are finally rebounding post-Covid; multiples have seen slight growth over previous years, with organizations offering specialty degrees seeing the highest multiples
Higher Education	Low	5.3x	8.7x
Hotels & Resorts	High	7.5x	10.2x	Hospitality is booming post-pandemic, but competition from short-term rentals remains fierce, leaving valuations steady in the 8x-13x range
Hotels & Resorts	Low	9.1x	12.8x
HVAC	High	Non-recurring Revenue: 2.1x Recurring Revenue: 3.4x	Non-recurring Revenue: 5x Recurring Revenue: 5.5x	HVAC multiples were flat through Q1 2022, except with companies in growing areas that have recurring maintenance contracts; but jumped significantly in late 2022 and remain one of the more significant inceases in multiples for an industry through Q4 2023
HVAC	Low	Non-recurring Revenue: 4.1x Recurring Revenue: 4.3x	Non-recurring Revenue: 6.1x Recurring Revenue: 6.8x
Industrial IOT	High	Non-recurring Revenue: 7.6x Recurring Revenue: 8.4x	Non-recurring Revenue: 12.5x Recurring Revenue: 14.1x	Multiples continue to rise in industrial automation & IoT given the imperative of digital transformation and the appetite of larger acquirers to snap up sub-$100M businesses
Industrial IOT	Low	Non-recurring Revenue: 9.1x Recurring Revenue: 9.9x	Non-recurring Revenue: 15.4x Recurring Revenue: 17.2x
IT & Managed Services	High	Non-recurring Revenue: 4.5x Recurring Revenue: 5.1x	Non-recurring Revenue: 8.4x Recurring Revenue: 10.1x	There is strong private equity demand among for MSPs due to the recurring revenue model, but a fragmented space and lack of scale make EBITDA multiples highly variable
IT & Managed Services	Low	Non-recurring Revenue: 6.6x Recurring Revenue: 7.2x	Non-recurring Revenue: 9.8x Recurring Revenue: 12.2x
Law Firms & Legal Services	High	Non-recurring Revenue: 3.3x Recurring Revenue: 4.1x	Non-recurring Revenue: 4.4x Recurring Revenue: 6.3x	EBITDA multiples for law firms haven’t changed much in 2023, with most M&A appetite going to legal tech companies that incorporate generative AI & recurring cash flow businesses
Law Firms & Legal Services	Low	Non-recurring Revenue: 3.9x Recurring Revenue: 4.9x	Non-recurring Revenue: 5.1x Recurring Revenue: 7.4x
Manufacturing	High	Non-recurring Revenue: 4.7x Recurring Revenue: 5.1x	Non-recurring Revenue: 6.6x Recurring Revenue: 7.1x	Small-to-midsize manufacturing company EBITDA multiples have risen slightly in 2023 but largely reverted to the pre-2020 mean of 6-8x – higher for firms with advanced tech such as 3D printing
Manufacturing	Low	Non-recurring Revenue: 5.8x Recurring Revenue: 6.4x	Non-recurring Revenue: 7.8x Recurring Revenue: 9.3x
Oil & Gas	High	Non-recurring Revenue: 5.2x Recurring Revenue: 5.8x	Non-recurring Revenue: 6.5x Recurring Revenue: 7.4x	Generally, EBITDA multiples in oil & gas haven’t recovered to pre-pandemic levels, with diversified oilfield services & equipment firms faring better than oilfield equipment manufacturers, oilfield services, and contract drilling firms
Oil & Gas	Low	Non-recurring Revenue: 5.4x Recurring Revenue: 6.3x	Non-recurring Revenue: 7.2x Recurring Revenue: 8.1x
Pharmaceutical	High	7.4x	11.8x	Most M&A activity in 2021-2022 targeted smaller pharmaceuticals companies with revenues under $150M; however, EBITDA multiple trends are somewhat opaque with few deals and little financial disclosure from private companies
Pharmaceutical	Low	9.3x	13.4x
Real Estate	High	Non-recurring Revenue: 3.3x Recurring Revenue: 3.7x	Non-recurring Revenue: 5.5x Recurring Revenue: 6.7x	In 2022, the highest multiples in real estate come from companies with recurring revenue in growing areas, a guaranteed income stream, or market dominance; lower multiples from from real estate services and development firms.
Real Estate	Low	Non-recurring Revenue: 3.9x Recurring Revenue: 4.5x	Non-recurring Revenue: 5.8x Recurring Revenue: 7.1x
Software Development	High	Non-recurring Revenue: 3.5x Recurring Revenue: 4.7x	Non-recurring Revenue: 5.5x Recurring Revenue: 6.6x	Software development firms follow the valuation patterns of other professional services firms but trend higher than legal services and MSPs, for instance; multiples have increased slightly since 2020, averaging 5.8x The growing interest in generative AI presents an opportunity for companies that develop in that space to see higher valuations
Software Development	Low	Non-recurring Revenue: 4.1x Recurring Revenue: 5.6x	Non-recurring Revenue: 6.2x Recurring Revenue: 7.2x
Staffing & Recruiting	High	Non-recurring Revenue: 4.7x Recurring Revenue: 5.5x	Non-recurring Revenue: 7.5x Recurring Revenue: 8.4x	Staffing & Recruiting firms see higher multiples than other services firms because of the consistency of their revenue, with firms that work with enterprises seeing the top end (~10x)
Staffing & Recruiting	Low	Non-recurring Revenue: 5.2x Recurring Revenue: 6.1x	Non-recurring Revenue: 8.7x Recurring Revenue: 9.4x
Transportation & Logistics	High	5.2x	8.2x	Logistics & transportation companies have seen their multiples grow, then stagnate, over the past 2 years, depending on how they’ve fared with supply chain shortages; best sector has been LTL & worst asset-based truckload
Transportation & Logistics	Low	5.9x	9.4x

$3-10M EBITDA Companies

EBITDA Multiples By Industry for $3-10M EBITDA Companies

Industry	Key Employee Turnover	Last 12 Months Revenue Growth		Notes
Industry	Key Employee Turnover	Low	High	Notes
Addiction Treatment	High	2.4x	5.4x	Higher multiples for more in-demand specialties, e.g. autism Residential multiples are ~20% higher than outpatient If the treatment center’s real estate is part of the deal, there is added complexity in calculating the valuation
Addiction Treatment	Low	3.3x	8.5x
Aerospace & Defense	High	8x	13.8x	Multiples hit historic highs in 2021-2022 driven by military needs related to the Russia-Ukraine war Space security & space tourism companies are fastest growing
Aerospace & Defense	Low	8.6x	16.7x
Automotive	High	Non-recurring Revenue: 3.8x Recurring Revenue: 4.7x	Non-recurring Revenue: 7.3x Recurring Revenue: 8.6x	Coming off years of supply shortages, Automotive OEMs are commanding the highest multiples
Automotive	Low	Non-recurring Revenue: 5.6x Recurring Revenue: 5.8x	Non-recurring Revenue: 9.3x Recurring Revenue: 10.4x
Aviation	High	Non-recurring Revenue: 5x Recurring Revenue: 5.6x	Non-recurring Revenue: 6.7x Recurring Revenue: 8.8x	Record customer acquisition during 2020 & 2021 pushed aviation company multiples ~15% higher than pre-pandemic, but recession effects through Q4 2022 tempered that growth, with multiples now ~8.5% below 2019 levels Businesses where aircraft are owned are closing slower, and at a slightly lower multiple, than businesses involved in the leasing and sale of aircraft
Aviation	Low	Non-recurring Revenue: 5.4x Recurring Revenue: 5.9x	Non-recurring Revenue: 8.6x Recurring Revenue: 9.4x
B2B SaaS	High	Non-recurring Revenue: 5.4x Recurring Revenue: 5.8x	Non-recurring Revenue: 9.1x Recurring Revenue: 13.2x	B2B SaaS multiples decreased for $3m-$10m EBITDA companies when interest rates rose in May ’22 and again when equity markets declined in late 2022 and early 2023 Strong interest in AI, specifically GPT-4 and other advanced LLMs, portends that businesses that make use of machine learning technology will see higher valuation multiples Smaller B2B SaaS companies may be valued based on Seller Discretionary Income (SDE) rather than EBITDA, but the two are comparable See our report on SaaS valuation multiples
B2B SaaS	Low	Non-recurring Revenue: 5.7x Recurring Revenue: 6.4x	Non-recurring Revenue: 10.3x Recurring Revenue: 17.1x
Biotech	High	Non-recurring Revenue: 7.5x Recurring Revenue: 9.2x	Non-recurring Revenue: 12.1x Recurring Revenue: 14x	Biotech companies often aren’t valued based on EBITDA due to the length of the approval process, high cost of development & binary nature of outcome; risk-adjusted NPV or comparables to similar companies are used
Biotech	Low	Non-recurring Revenue: 8.3x Recurring Revenue: 10x	Non-recurring Revenue: 13.3x Recurring Revenue: 16.6x
Commercial Insurance	High	Non-recurring Revenue: 6.2x Recurring Revenue: 6.9x	Non-recurring Revenue: 8.2x Recurring Revenue: 9.9x	As interest rates rose in Q2 & Q3 2022, PE firms had more limited access to capital, tempering the higher range of multiples commercial insurance firms saw in 2020 & 2021, which had been 40-50% above 2010s levels; however, as of Q4 2023, there is still plenty of M&A opportunity from larger acquirers & PE shops
Commercial Insurance	Low	Non-recurring Revenue: 7.1x Recurring Revenue: 7.9x	Non-recurring Revenue: 9.1x Recurring Revenue: 12x
Construction	High	Non-recurring Revenue: 3x Recurring Revenue: 4.4x	Non-recurring Revenue: 6.7x Recurring Revenue: 7.3x	EBITDA multiples in construction skew low due to non-recurring revenue and high costs, but when automation (e.g. modular, prefab) and software play a larger role, multiples rise
Construction	Low	Non-recurring Revenue: 4.1x Recurring Revenue: 5.7x	Non-recurring Revenue: 6.2x Recurring Revenue: 9x
Cybersecurity	High	Non-recurring Revenue: 5.9x Recurring Revenue: 6.9x	Non-recurring Revenue: 10.2x Recurring Revenue: 13.4x	Spurred by the shift to online work, M&A activity in cybersecurity peaked between Q4 2021 and Q1 2023, led by PE & VC firms, with a small number of strategic acquisitions; multiples are slightly lower as of Q4 2023 but remain strong despite deal flow having slowed down
Cybersecurity	Low	Non-recurring Revenue: 6.4x Recurring Revenue: 7.9x	Non-recurring Revenue: 10.6x Recurring Revenue: 15.5x
eCommerce	High	Non-recurring Revenue: 6.5x Recurring Revenue: 8.8x	Non-recurring Revenue: 10x Recurring Revenue: 12.9x	E-commerce valuations remain strong post-pandemic, with the main limiters being supply chain challenges and “Amazon Fear”; niche specialists getting highest multiples
eCommerce	Low	Non-recurring Revenue: 8.7x Recurring Revenue: 11.4x	Non-recurring Revenue: 11.6x Recurring Revenue: 14.9x
Engineering	High	3.8x	6.3x	Engineering firms have non-recurring cash flow & thus see lower EBITDA multiples; exception is firms with long-term government contracts (provided customer concentration is <40%)
Engineering	Low	4.4x	8.8x
Entertainment	High	Non-recurring Revenue: 4.2x Recurring Revenue: 5.8x	Non-recurring Revenue: 9.2x Recurring Revenue: 11.5x	Entertainment is a particularly asymmetrical industry in terms of multiples, as a small amount of content receives almost all of consumers’ attention & thus receives the highest M&A interest; thus, go big or go home
Entertainment	Low	Non-recurring Revenue: 4.6x Recurring Revenue: 6.9x	Non-recurring Revenue: 9.2x Recurring Revenue: 12.2x
Environmental & Clean Energy	High	Non-recurring Revenue: 4.7x Recurring Revenue: 5.4x	Non-recurring Revenue: 8.6x Recurring Revenue: 10.2x	Environmental & clean energy valuations have remained steady through Q3 2023, rising at a slower pace than other industries, with solar, electronics recycling, and waste-to-energy outpacing more traditional businesses in this sector
Environmental & Clean Energy	Low	Non-recurring Revenue: 5.9x Recurring Revenue: 6.8x	Non-recurring Revenue: 11.4x Recurring Revenue: 14x
Financial Services	High	Non-recurring Revenue: 3.8x Recurring Revenue: 4.5x	Non-recurring Revenue: 6.2x Recurring Revenue: 7.5x	Financial advisories and other services firms saw modest increases in EBITDA multiples in 2020-2022, which remained relatively unchanged through Q3 2023 despite less deal flow
Financial Services	Low	Non-recurring Revenue: 4.2x Recurring Revenue: 4.7x	Non-recurring Revenue: 6.4x Recurring Revenue: 8x
Fintech	High	Non-recurring Revenue: 7x Recurring Revenue: 7.4x	Non-recurring Revenue: 12x Recurring Revenue: 17.1x	Fintech was one of top beneficiaries of pandemic-induced behavior change. Alternative lending, payment platforms, and cryptocurrency businesses saw the greatest rise in valuations. While valuations took a hit after interest rates rose in May 2022, they are still above historic benchmarks
Fintech	Low	Non-recurring Revenue: 7.7x Recurring Revenue: 9.1x	Non-recurring Revenue: 13.3x Recurring Revenue: 19.8x
Healthcare	High	Non-recurring Revenue: 5.8x Recurring Revenue: 6.3x	Non-recurring Revenue: 8x Recurring Revenue: 9x	Healthcare multiples are increasing, particularly for mid-sized businesses, led by home-based services and high-end professional services (e.g. concierge practices)
Healthcare	Low	Non-recurring Revenue: 6.2x Recurring Revenue: 6.8x	Non-recurring Revenue: 8.6x Recurring Revenue: 9.8x
Higher Education	High	N/A	N/A	Colleges that serve students in person are finally rebounding post-Covid; multiples have seen slight growth over previous years, with organizations offering specialty degrees seeing the highest multiples
Higher Education	Low	6.4x	10.5x
Hotels & Resorts	High	9.1x	12.3x	Hospitality is booming post-pandemic, but competition from short-term rentals remains fierce, leaving valuations steady in the 8x-13x range
Hotels & Resorts	Low	11x	15.5x
HVAC	High	Non-recurring Revenue: 2.5x Recurring Revenue: 4.1x	Non-recurring Revenue: 6.1x Recurring Revenue: 6.7x	HVAC multiples were flat through Q1 2022, except with companies in growing areas that have recurring maintenance contracts; but jumped significantly in late 2022 and remain one of the more significant inceases in multiples for an industry through Q4 2023
HVAC	Low	Non-recurring Revenue: 5x Recurring Revenue: 5.2x	Non-recurring Revenue: 7.4x Recurring Revenue: 8.2x
Industrial IOT	High	Non-recurring Revenue: 9.2x Recurring Revenue: 10.2x	Non-recurring Revenue: 14.5x Recurring Revenue: 17.1x	Multiples continue to rise in industrial automation & IoT given the imperative of digital transformation and the appetite of larger acquirers to snap up sub-$100M businesses
Industrial IOT	Low	Non-recurring Revenue: 11x Recurring Revenue: 12x	Non-recurring Revenue: 18.2x Recurring Revenue: 20.8x
IT & Managed Services	High	Non-recurring Revenue: 5.4x Recurring Revenue: 6.2x	Non-recurring Revenue: 10.2x Recurring Revenue: 12.2x	There is strong private equity demand among for MSPs due to the recurring revenue model, but a fragmented space and lack of scale make EBITDA multiples highly variable
IT & Managed Services	Low	Non-recurring Revenue: 8x Recurring Revenue: 8.7x	Non-recurring Revenue: 11.9x Recurring Revenue: 14.8x
Law Firms & Legal Services	High	Non-recurring Revenue: 4x Recurring Revenue: 5x	Non-recurring Revenue: 5.3x Recurring Revenue: 7.6x	EBITDA multiples for law firms haven’t changed much in 2023, with most M&A appetite going to legal tech companies that incorporate generative AI & recurring cash flow businesses
Law Firms & Legal Services	Low	Non-recurring Revenue: 4.7x Recurring Revenue: 5.9x	Non-recurring Revenue: 6.2x Recurring Revenue: 9x
Manufacturing	High	Non-recurring Revenue: 5.7x Recurring Revenue: 6.2x	Non-recurring Revenue: 8x Recurring Revenue: 8.6x	Small-to-midsize manufacturing company EBITDA multiples have risen slightly in 2023 but largely reverted to the pre-2020 mean of 6-8x – higher for firms with advanced tech such as 3D printing
Manufacturing	Low	Non-recurring Revenue: 7x Recurring Revenue: 7.7x	Non-recurring Revenue: 9.4x Recurring Revenue: 11.3x
Oil & Gas	High	Non-recurring Revenue: 6.3x Recurring Revenue: 7x	Non-recurring Revenue: 7.9x Recurring Revenue: 9x	Generally, EBITDA multiples in oil & gas haven’t recovered to pre-pandemic levels, with diversified oilfield services & equipment firms faring better than oilfield equipment manufacturers, oilfield services, and contract drilling firms
Oil & Gas	Low	Non-recurring Revenue: 6.5x Recurring Revenue: 7.6x	Non-recurring Revenue: 8.7x Recurring Revenue: 9.8x
Pharmaceutical	High	8.8x	14.2x	Most M&A activity in 2021-2022 targeted smaller pharmaceuticals companies with revenues under $150M; however, EBITDA multiple trends are somewhat opaque with few deals and little financial disclosure from private companies
Pharmaceutical	Low	11.2x	16.3x
Real Estate	High	Non-recurring Revenue: 4x Recurring Revenue: 4.5x	Non-recurring Revenue: 6.7x Recurring Revenue: 8.1x	In 2023, the highest multiples in real estate come from companies with recurring revenue in growing areas, a guaranteed income stream, or market dominance; lower multiples from from real estate services and development firms
Real Estate	Low	Non-recurring Revenue: 4.7x Recurring Revenue: 5.4x	Non-recurring Revenue: 7x Recurring Revenue: 8.6x
Software Development	High	Non-recurring Revenue: 4x Recurring Revenue: 5.7x	Non-recurring Revenue: 6.3x Recurring Revenue: 7.8x	Software development firms follow the valuation patterns of other professional services firms but trend higher than legal services and MSPs, for instance; multiples have increased slightly since 2020, averaging 7.1x The growing interest in generative AI presents an opportunity for companies that develop in that space to see higher valuations
Software Development	Low	Non-recurring Revenue: 5x Recurring Revenue: 6.7x	Non-recurring Revenue: 7.6x Recurring Revenue: 8.8x
Staffing & Recruiting	High	Non-recurring Revenue: 5.7x Recurring Revenue: 6.7x	Non-recurring Revenue: 9.1x Recurring Revenue: 10.2x	Staffing & Recruiting firms see higher multiples than other services firms because of the consistency of their revenue, with firms that work with enterprises seeing the top end (~13x)
Staffing & Recruiting	Low	Non-recurring Revenue: 6.3x Recurring Revenue: 7.4x	Non-recurring Revenue: 10.5x Recurring Revenue: 11.4x
Transportation & Logistics	High	6.2x	9.8x	Logistics & transportation companies have seen their multiples grow, then stagnate, over the past 2 years, depending on how they’ve fared with supply chain shortages; best sector has been LTL & worst asset-based truckload
Transportation & Logistics	Low	6.9x	11.9x

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