SDE Calculator — Seller Discretionary Earnings
SDE is the single most important number in a home service business sale. Calculate your normalized SDE — the number buyers multiply to determine your business value.
What is SDE?
Seller Discretionary Earnings (SDE) = Net Income + Interest + Taxes + Depreciation + Amortization + Owner Add-Backs
SDE represents the total financial benefit to a working owner-operator. It's the standard valuation basis for home service businesses under ~$5M in revenue. Buyers pay a multiple of this number.
EBITDA vs. SDE: EBITDA excludes owner compensation adjustments and is used for larger businesses ($5M+ revenue) where PE firms replace the owner with a management team. Most home service businesses are valued on SDE.
Step 1 — Start with Net Income
Enter your most recent full-year figures from your P&L or tax return.
Step 2 — Add Back Owner-Specific Items
Add back any expenses that benefit you personally or won't transfer to a new owner. Leave blank if not applicable.
Step 3 — Apply a Multiple
Home service businesses typically trade at 2.0x–5.0x SDE. Use the slider or enter a specific multiple. Not sure? Use 3.0x as a starting point.
SDE Calculated. Now Let's Talk Real Market Value.
A calculator gives you a number. Jason Taken gives you context — which buyers are active right now, what they're paying for businesses like yours, and how to structure your deal for maximum net proceeds.
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