Estimate business value using multiple methods: discounted cash flow, revenue multiples, EBITDA multiples, and asset-based approaches.
The Business Valuation Calculator produces four independent estimates of what a business is worth: a discounted cash flow, a revenue multiple, an EBITDA multiple, and an asset-based net value. You supply revenue, EBITDA, free cash flow, and balance-sheet totals, plus the multiples and rates you want to test, and the four results can be compared directly. The calculation runs entirely in the browser, so the figures never leave your machine. Most users are surprised by two things: how far apart the methods land, and how much of a DCF result sits in the terminal value rather than the forecast years.
A concrete input and expected output from the current implementation.
Input
Free cash flow: $100,000 per year. Forecast horizon: 5 years. Discount rate: 10%. Terminal growth rate: 3%.
Expected output
DCF estimate: $1,292,720. Discounted years 1-5: about $90,909, $82,645, $75,131, $68,301, and $62,092, totaling $379,079. Terminal value of $1,471,429 discounted back to today: $913,641. Terminal value is about 71% of the total.
Each year's $100,000 is discounted by 1.10 raised to the year number, giving the five present values. The terminal value capitalizes year 6's $103,000 cash flow at 10% minus 3% growth, and discounting that back over five years adds $913,641, which outweighs the five explicit years combined.
The tool projects the free cash flow you enter across the forecast horizon, discounting each year's flow by (1 + rate)^n. After the final forecast year it adds a terminal value using the Gordon growth formula, next year's cash flow divided by (rate minus growth), then discounts that terminal value back to today. The two discounted parts are summed into the DCF estimate.
The revenue and EBITDA methods multiply the figure you enter by the multiple you choose; the tool applies whatever multiple you set, so the estimate inherits your industry assumption. The asset-based method subtracts liabilities from assets to produce net book value, ignoring earnings, intangibles, and goodwill. All four outputs are shown together so the spread between them is visible.
None of them, alone. Each answers a different question: what cash flow can support, what the market pays, and what the assets are worth. A defensible estimate is a range across methods, weighted toward those that fit the business type. For a formal valuation, such as for tax, a court, or financing, a credentialed appraiser is required.
The Gordon growth formula capitalizes every dollar the business earns after the forecast horizon into one terminal figure, and discounting it back over only five years leaves it large. In the example above it is 71% of the total. That is expected DCF behavior, not a bug; shrink it by lowering the growth rate or lengthening the horizon.
The example and behavioral notes were checked against the browser implementation. Standards and primary references below define the relevant format, formula, or platform behavior.
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