Valuing a SaaS business starts with understanding the quality of its recurring revenue. Begin with monthly recurring revenue (MRR), then assess churn, gross margin, and growth rate. Most small SaaS businesses trade on a multiple of annual profit (SDE) ranging from 2.5x to 5x, with healthier retention and growth pushing toward the top of that band. Always normalise owner salary and one-off costs before applying a multiple.

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Elena Marsh Head of Valuations

Former sell-side M&A analyst; has valued 400+ online businesses across SaaS, e-commerce and content.

Elena leads the valuation desk at BuySellDigi. She spent eight years in technology M&A before moving into the online-business space, where she has personally modelled and benchmarked hundreds of acquisitions. She writes about pricing, multiples, and reading financial statements without being fooled by them.

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