| Metric | Benchmark | Notes |
|---|---|---|
| $1M-$5M revenue | 2.5-4.5x (often valued on SDE) | Buyers at this size are small PE firms, individuals and aggregators. |
| $5M-$10M revenue | 3.5-6x EBITDA | The lower middle market. |
| $10M-$25M revenue | 5-9x EBITDA | The sweet spot for growth equity PE. With a single buyer and no auction, expect the bottom of the band. |
| $25M-$50M revenue | 7-11x EBITDA | Multiple strategic and PE bidders. |
| $50M-$100M revenue | 8-13x EBITDA | Premium multiples and competitive processes. |
| $100M+ revenue | 10-15x+ EBITDA | Strategic premiums in a competitive auction. |
| Growth adjustment | Under 10%: low end; 10-20%: mid-range; 20-40%: upper range; over 40%: top of range | Above 40%, buyers get sceptical about sustainability. 30%+ growth with 15%+ EBITDA margins is extremely attractive. |
| Category adjustment | Beauty +2-4x; health, supplements and pet +1-2x; apparel -1-2x | Food and beverage runs base to +1x, consumer electronics base, and home goods -1x to base. |
| Revenue multiple | 0.5-3x revenue for high-growth, pre-profit brands | Growing 20-40%: 0.5-1.5x; 40-60%: 1-2x; 60-100%+: 1.5-3x. Subscription revenue with 80%+ retention adds a 0.5-1x premium. |
| SDE multiple | 2.5-4.5x SDE | Seller's discretionary earnings: EBITDA plus the owner's salary, benefits and one-off expenses. Used below about $5M in revenue. |
| EBITDA needed for PE interest | $3M+ EBITDA | Above $5M, competitive processes with multiple bidders become more likely. |
| Strategic vs financial buyers | Usually: strategics pay the highest multiples | They typically pay the most but move slower, while financial buyers pay less but execute cleaner. A strategic trading at 14x can justify 10x for your brand because it absorbs you at its own multiple. |
| What lowers a valuation | Amazon over 50% of revenue, any customer over 25%, returns over 15%, founder dependence | If the business can't run without you, buyers either discount heavily or walk away. |
| Earnouts and re-trades | Typically 20-40% of consideration, tied to 1-2 year targets | Cash at close beats an earnout. Expect a re-trade too: 30-50% of deals get renegotiated down between LOI and close, typically by 5-15%. |
How to use these benchmarks
These ranges are directional, not guarantees. They are drawn from The DTC Playbook and Rob Ward's operating experience taking Quad Lock from $0 to a $500M exit, cross-checked against widely cited DTC data. The point is not the exact number - it is whether you sit above or below it, and what to do about the gap. Judge yourself against your own category and trend as well.
Last reviewed: October 2026. Benchmarks are refreshed as the playbook is updated.
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