A valuation is required for trade sales, acquisitions, shareholder buyouts, restructurings, or funding applications. Different objectives lead to different outcomes, and that is not an inconsistency but a natural consequence of perspective.
- Normalised EBITDA as the baseline
- Multiples by sector and company scale
- DCF to substantiate future cash flows
Comparing methodologies
The multiple method multiplies your normalised EBITDA by an industry benchmark and adjusts for net debt. Fast and market-aligned, but sensitive to the chosen multiple. The DCF method discounts free cash flows at a risk-weighted cost of capital: more robust, but heavily reliant on forecasts. Net asset value sets the floor and is primarily relevant for asset-heavy and property-rich companies.
What enhances valuation in the Brainport region
- A diversified customer portfolio without customer concentration risk
- Recurring revenue and long-term contracts
- Transferability: the business does not depend solely on the owner-director
- Demonstrable technical talent and well-documented processes
- Proprietary IP, certifications, and formal OEM qualifications
Frequently asked questions
What is a normal multiple for SMEs?
For healthy SMEs, multiples typically range between four and seven times normalised EBITDA, stretching higher for scalable or technology-driven businesses and lower where there is heavy owner dependency.
Is a valuation the same as the sale price?
No. A valuation is an analytical calculation; the transaction price is the outcome of negotiations, debt service capacity, and competitive tension among prospective buyers.