What is your company worth when you sell?

How does a buyer determine the value of your company?

There is not one right method. There are four that are widely used. Together they give a range, and that range is your negotiating room.

1. A factor times your operating profit. That profit is called EBITDA. It is your result before interest, taxes, depreciation and amortisation. It says something about what your company earns at its core.
2. The present value of your future cash flows. A euro in five years is worth less than a euro today. So you discount those future flows back to now.
3. Your debt repayment capacity. Banks and investors look at how much debt this company can carry and repay.
4. A factor times your revenue. You see that at accountancy and law firms. At most other companies almost never.

For virtually every SME the first method is leading. So remember it well.

What is a normal multiple in the Netherlands?

At Exit Unlocked, our day about exits, one of the speakers gave the figures. I summarise them.

According to the Dealsuite and Brookz M&A Barometer (Overname Barometer), the average multiple for Dutch SMEs was 4.8 to 4.9 in 2024 and 5.0 at the end of 2025. The difference per sector is bigger than the difference per year: agencies in media, advertising and communication were around 3.8, business services around 4.8 and software companies around 7.2 to 7.4. Size counts too: at two hundred thousand euros of EBITDA a buyer pays on average 3.7 times profit, at ten million 6.6 times. In Germany, Austria and Switzerland the average is a good half point higher than in the Netherlands.

It differs strongly per sector. Hospitality is usually between 2 and 3. Software companies with a subscription model came out at an average of around 7.2 to 7.4 in 2024 and 2025. For Dutch SMEs, an 8 is already exceptionally high.

The Netherlands is not a country of high multiples. The market is small and the reach is limited. That is no reason not to build. It is a reason to calculate realistically.

Why is the company value not the amount you keep?

This is the worked example that stuck most on our day. I repeat it here literally.

Take a company with 200,000 euros of operating profit. The buyer calculates with a factor of 5. The enterprise value then comes to 1,000,000 euros.

Then follows the step that surprises most entrepreneurs. If there is 500,000 euros of debt on the balance sheet, it is deducted. If there is 600,000 euros of surplus cash in the account, it is added. You end up at 1,100,000 euros for the shares.

That amount is called the equity value. It is what is paid for your shares. It is still not what lands in your account.

How do you actually get that amount paid?

Two deals with exactly the same price can turn out completely differently. The price is in the headline. The structure determines what you actually get.

A purchase price rarely consists of one amount. In practice you see six components.

1. Cash at closing. The amount that actually comes to you on the day of signing at the notary.
2. Deferred payment. Part of the price that follows on an agreed later date.
3. An earn-out. Conditional money you only get if the company reaches certain targets after the sale.
4. A subordinated loan. You then lend part of the purchase price to your own buyer. If it goes wrong, you are behind the bank in the queue.
5. Shares in the acquiring party. You get paper instead of money, with the promise that it will be worth more later.
6. Escrow. A blocked account where part is temporarily parked, as security for the buyer.

Only the first component is money. The other five are promises.

The reason is simple. From the signature onwards you no longer steer. The buyer decides what happens to the numbers afterwards. And what exactly profit is seems set in stone but is subjective. Discussion arises about virtually every component that lies after closing.

Shares in the acquiring party feel like sharing in the success. On paper your value rises along with it. On paper it falls just as hard. I know sellers whose valuation stood at zero within a year, while the deal felt good on the day of signing.

At Exit Unlocked it was summed up like this. Decide in advance for what amount you are willing to walk away. Calculate that amount in cash at closing only. Everything above it is a bonus.

That does not mean you should demand everything up front. A buyer who takes all the risk pays less for it. It means you know exactly which part of the price is really yours.

What makes your multiple higher or lower?

The factor is not a law of nature. Five things move it.

One. Your growth. A company without momentum sells with its back against the wall.

Two. Your predictability. Recurring revenue from existing clients is worth more than a full sales funnel.

Three. Your margin. A buyer pays for profit that structurally comes back, not for one good year. Steering on revenue instead of margin is the classic mistake here.

Four. Your dispensability. One of the parties I spoke to in 2020 opened the very first conversation with one sentence. The company revolves around you, so there will have to be a big earn-out. Every gram of dependence on the founder is converted at the table into deferred money and extra years.

Five. Your preparation. A buyer first cleans up your profit. One-off costs and private items go out, a market-rate salary goes in. That is called normalising. At a factor of 5, every euro you rightly add back here counts five times in the price.

The same applies to your costs. I had never thought about it myself. When I decided to sell in 2019, I did not even know the term normalising profit. We had, for example, a lunch of fifteen euros per person per day. That cost 20,000 euros a year. At a factor of 5, that is 100,000 euros I missed out on. For sandwiches.

What can you do with this today?

Put three numbers on paper today.

One, your normalised profit over the last twelve months. Two, the amount for which you are willing to walk away, calculated in cash at closing. Three, the number of months your company can last without you.

Together those three numbers determine most of your outcome. They also determine whether you can wait. And waiting is the strongest negotiating position there is.

I have been through this entire process myself. In 2020 I sold my own PR and marketing agency, with forty colleagues and one million euros in EBITDA.

Since then I have sat at the table as an adviser with founders who are making this calculation for the first time. Before we start a sales process, I first challenge them on their motives. My wish is that ten years from now they still stand behind their choice.