Glossary · Reading the business
Market Multiples
In short
A valuation method that uses ratios derived from recent sales of comparable businesses to estimate a target business's value. Common multiples include multiples of EBITDA or SDE.
What it means in a deal
Your business valuation will likely incorporate market multiples, comparing the target business to similar transactions. It's crucial to understand the nuances of these comparisons, ensuring the comparable businesses truly match in size, industry, and geography, to arrive at a fair market value.
Related terms
Common questions about Market Multiples
- What are the requirements for assigning secondary market loans through SBA Form 1088?
- How does a lender determine the fair market value of business equipment used as collateral?
- How does the SBA verify the fair market value of assets contributed as equity injection?
- How does a lender evaluate the market value of collateral when there are limited comparable sales?
- If a borrower contributes equipment as equity, how does the lender verify its fair market value?
- How does the SBA evaluate the fair market value of goodwill in a business acquisition for financing?
Defined by CapBench SBA Intelligence — plain-English definitions for business buyers, lenders, advisors, and AI agents, grounded in public SBA rules and records. Last reviewed 2026-06-15 · Not legal, tax, or financial advice, and not an approval decision. Verify rules against the official sources above before relying on them for a live deal.
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