Sell · Step 3
Value the business defensibly
~10 min
Set an asking price you can defend with numbers, not gut. Buyers will model it anyway.
EBITDA-multiple method (most common)
- Calculate EBITDA = Net profit + Interest + Tax + Depreciation + Amortisation.
- Normalise — add back owner add-backs (excess salary, personal expenses, one-off legal/audit costs).
- Apply a sector multiple (services 2.5–4x, retail 3–5x, manufacturing 4–6x, tech-enabled 5–8x).
- Adjust for size, growth, customer concentration, and management depth.
- Add surplus cash, subtract debt — that's enterprise value.
Cross-check methods
- Discounted Cash Flow — for stable, predictable businesses
- Revenue multiple — useful for growth businesses with thin EBITDA
- Asset-based — floor value for asset-heavy businesses (manufacturing, transport, real estate)
Use the free EBITDA Normalizer & Valuation tool. It walks you through add-backs and shows a 3–6x multiple range you can use as a defensible asking price.
Disclaimer
The information in this guide is provided for general guidance only and is subject to change. Fees, timelines, and regulatory requirements in Kenya are updated regularly. Before acting, please confirm details with the relevant authority (KRA, eCitizen, BRS, county government, or other regulator) or speak with a qualified MyBiashara advisor. MyBiashara is not liable for decisions made solely on the basis of this content.
