How much is your business worth?
Most profitable Singapore SMEs sell for 2–9× adjusted EBITDA, depending on the sector. Here's exactly how the arithmetic works — with real multiples by industry and a worked example a buyer's accountant would accept.
To value a business in Singapore, take adjusted EBITDA — profit before interest, tax, depreciation and amortisation, normalised for owner's excess salary and one-off costs — and multiply it by a sector multiple, typically 2× to 9×. Asset-heavy or loss-making businesses are valued on assets, licences or strategic worth instead.
Step 1 — Normalise the profit (adjusted EBITDA)
Buyers don't buy your accounting profit; they buy the cash the business would generate under their ownership. A worked example:
| Line item | Amount |
|---|---|
| Profit before tax (per accounts) | S$450,000 |
| + Interest expense | S$20,000 |
| + Depreciation & amortisation | S$80,000 |
| EBITDA | S$550,000 |
| + Owner's salary of S$300,000, less S$150,000 market rate for a replacement GM (add back the excess) | S$150,000 |
| + One-off renovation expensed this year | S$50,000 |
| Adjusted EBITDA | S$750,000 |
At a 3–4× sector multiple, this business is indicatively worth S$2.25M–S$3.0M. Note the direction of each adjustment matters: if the owner underpays themselves, the adjustment goes the other way — a deduction, not an add-back.
Step 2 — Apply the sector multiple
| Industry (Singapore SME) | Typical adjusted EBITDA multiple |
|---|---|
| Software / technology | 4× – 9× |
| Healthcare / education | 4× – 7× |
| Manufacturing / engineering | 3× – 6× |
| Professional / B2B services | 3× – 6× |
| Logistics / transport | 3× – 5.5× |
| E-commerce / online | 2.5× – 5.5× |
| F&B / food manufacturing | 2.5× – 5× |
| Distribution / wholesale | 2.5× – 5× |
| Construction / M&E | 2× – 4× |
| Retail / consumer | 2× – 4× |
Where you land within the range depends on: growth trend, customer concentration (one customer above 30% of revenue is a red flag), recurring vs project revenue, margin stability, contract quality, and how dependent the business is on you personally.
Step 3 — Reality-check against the market
A valuation is a hypothesis; the market is the test. Serious buyers benchmark against comparable transactions, and the final number also reflects deal structure — an all-cash completion prices differently from an earn-out. This is why a defensible range beats a single precise-sounding number.
Valuation questions, answered
Most profitable Singapore SMEs sell for a multiple of adjusted EBITDA — typically 2× to 9× depending on industry, size, growth and owner-dependence. A business earning S$500,000 adjusted EBITDA in a 3–4× sector would be worth roughly S$1.5M–S$2M. Use the estimator on this page for an indicative range.
EBITDA is earnings before interest, tax, depreciation and amortisation — a proxy for the cash profit a buyer acquires. 'Adjusted' means normalising it: adding back the excess of the owner's salary over a market-rate replacement, one-off or non-recurring expenses, and personal expenses run through the company; and deducting any market-rate costs the business currently avoids, such as rent on premises the owner owns personally.
Multiples price risk and growth. Recurring-revenue businesses (software, healthcare, education) command 4–9× because earnings are predictable. Project-based sectors (construction, retail) sit at 2–4× because each year starts from zero. Contracts, customer diversification and margin stability move a business up within its sector's range.
Both. Profit (adjusted EBITDA) sets the valuation base, but revenue scale affects the multiple itself — larger businesses trade at higher multiples because they're less fragile and attract institutional buyers. That's one reason a S$10M-revenue business is usually worth more than twice a S$5M one with the same margin.
Yes. An estimate applies a sector multiple to your stated EBITDA. A real assessment verifies the EBITDA adjustments line by line, weighs customer concentration, contract quality, growth and transferability, and positions the business against actual recent transactions — producing a range you can defend across the table from a buyer's accountant.
You can't — not from one offer. An unsolicited buyer is pricing against your ignorance of the market, not against other bidders, and unsolicited first offers on Singapore SMEs routinely come in 20–40% below what a competitive process achieves. The answer isn't to reject the buyer; it's to establish an independent valuation, then either negotiate from evidence or quietly test the market alongside them. We regularly run exactly this play — the original buyer often still wins, but at a market price.
Often, yes — but on a different basis. Loss-making or break-even businesses sell on asset value (equipment, fitted premises, stock), on licences and approvals that are slow to obtain from scratch, on contracts and customer relationships, or to a strategic buyer who can strip out duplicate costs. The price reflects that basis rather than an earnings multiple. What matters is being honest about which basis applies before going to market.
Want a number you can actually defend?
Send us your rough figures on WhatsApp and get a considered view — what the range is, what's driving it, and what would raise it. Confidential, no fee, no obligation.