EBITDA Multiples by Industry (2026 Private-Company Data)

In the lower middle market, private companies often trade around 3x–8x LTM adjusted EBITDA, but there is no universal industry multiple. GF Data reported 7.3x across 80 PE-backed transactions in Q1 2026, while BizBuySell reported 2.7x cash flow for much smaller Main Street deals in Q2. Sector, scale, revenue quality, growth, concentration and buyer type determine the relevant benchmark.

This page is a reference dataset, not a listicle. It benchmarks enterprise value to LTM adjusted EBITDA for private companies across 25 industries and three earnings-size bands, separates the three transaction markets that get conflated in most published "average multiple" figures, and shows the provenance of every number. Implied enterprise values run from roughly $3 million to $300 million, inside the $1 million–$500 million TEV universe GF Data tracks for PE-backed middle-market deals.

Key Takeaways

• Multiples price enterprise value, not your proceeds. EV = multiple × LTM adjusted EBITDA. Equity value is EV minus funded debt and debt-like items, plus excess cash, adjusted for working capital — and cash at closing differs again.
• A benchmark is only valid when sector, size and earnings basis all match. GF Data's 7.3x Q1 2026 average describes 80 PE-backed middle-market deals; it says nothing about a $700K-earnings service business.
• Below roughly $1M of earnings, buyers price SDE, not EBITDA. BizBuySell's Main Street average of 2.7x is a cash-flow (SDE) multiple — a different metric on a different earnings base, not a comparable EBITDA multiple.
• Public EV/EBITDA is context, not private pricing. NYU Stern's January 2026 data shows US public companies at a 19.7x average — trading levels for large, liquid, diversified firms, not control-sale values for private companies.

2026 EBITDA multiples by industry and company size

The table below shows indicative enterprise value to LTM adjusted EBITDA ranges for private US and Canadian companies, segmented by LTM adjusted EBITDA band. Every range is Windsor Drake analyst judgment: a synthesis of the cited public transaction datasets (GF Data, BizBuySell, NYU Stern), observed buyer behavior and Windsor Drake's 2024–2026 sell-side deal flow — not licensed row-level transaction data. Treat each cell as a starting range for a well-run competitive process, then adjust for the six driver groups below.

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• How to read this table. Columns are LTM adjusted EBITDA size bands; cells are indicative EV ranges expressed as multiples of that EBITDA. Enterprise value is cash-free, debt-free. "Trend" is the directional change Windsor Drake observes versus 2025, not a computed statistic.
• Statistic and sample. No cell is a mean, median or interquartile range of a proprietary sample, and no observation counts are claimed. Ranges are analyst judgment informed by the sources in the methodology; "Moderate" confidence marks sectors where Windsor Drake has direct recent deal flow, "Indicative" marks sectors benchmarked primarily from public sources.
• Smaller businesses. Below roughly $1M of earnings, these EBITDA ranges do not apply — see the Main Street note below.

Main Street vs. middle market vs. public: choose the correct benchmark first

Most "average EBITDA multiple" claims fail because they blend three different transaction markets. Identify your market tier before you benchmark anything; each tier uses a different earnings basis and a different data universe.

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The company-size effect, from sourced data

Size is one of the strongest observed pricing variables — not the single determinant. GF Data's small-deal analysis for the first half of 2025, covering 118 tracked transactions under $25M TEV, shows the pattern directly. Note that these brackets are enterprise-value (TEV) brackets, not EBITDA bands; keep the two segmentations distinct.

GF Data describes the gap between sub-$10M deals and the $10M–$25M tier as "nearly a full turn" of EBITDA that persists across periods. In Q1 2026 the firm also noted that larger platform transactions saw stronger valuation gains while pricing for smaller deals and add-ons stayed roughly flat. The mechanics are consistent: larger companies attract deeper buyer pools, cheaper and more available financing, and more professionalized operations — and buyers pay for the reduced risk. This is why the benchmark table above segments every industry by earnings band rather than quoting one number per sector.

Priority industry notes for 2026

Ten sectors where Windsor Drake sees the most seller activity. Each note states the metric that actually governs pricing, how size changes it, the period, and the caveat buyers will raise. Ranges referenced are the indicative analyst-judgment bands from the table above, as of August 2026.

B2B SaaS

Profitable B2B SaaS is priced on EV/LTM adjusted EBITDA once EBITDA is real and durable; below breakeven, buyers switch to ARR and revenue metrics entirely. Size moves the band sharply: indicative ranges run 5.5–8.0x at $1M–$3M of EBITDA and 9.0–13.0x at $10M+, judgment as of August 2026. Net revenue retention, gross margin and organic growth dominate the outcome inside any band — a shrinking SaaS business with 20% margins is not a premium asset regardless of the category. Caveat: buyers will re-cut "EBITDA" for capitalized development costs, so expect the metric itself to be negotiated.

Fintech & payments

Fintech spans two pricing regimes: profitable, compliance-mature platforms trade on EV/adjusted EBITDA (indicative 7.0–10.0x at $3M–$10M of EBITDA, August 2026 judgment), while pre-profit companies trade on ARR or processed-volume metrics. Payments businesses with contractual residual streams price toward the top of the band; see the dedicated payments valuation benchmarks. Strategic acquirers and sponsors both pay for durable merchant or bank relationships, low attrition and clean regulatory posture. Caveat: revenue that depends on a single bank sponsor, processor or network agreement is discounted the way customer concentration is — sometimes more heavily.

Cybersecurity services

Managed security providers and MSSPs are priced on EV/LTM adjusted EBITDA, with indicative ranges of 6.5–9.0x at $3M–$10M of EBITDA and 8.5–12.0x above $10M (August 2026 judgment). Recurring monitoring contracts, certifications and clearances, and scarce senior talent drive premiums; project-heavy pen-testing revenue prices lower than contracted MDR/SOC revenue. Consolidators remain active, which supports the firm end of the range for platforms with defensible retention. Caveat: buyers scrutinize tooling dependence — a service book built entirely on one vendor's stack, or reliant on a few certified individuals, gets treated as transferable risk rather than durable capability.

Healthcare IT and healthcare services

Healthcare IT with recurring, compliance-embedded revenue carries indicative ranges of 7.0–9.5x at $3M–$10M of EBITDA and 8.5–12.0x above $10M; multi-site healthcare services run lower, roughly 5.5–7.5x in the middle band (August 2026 judgment). The governing metric is EV/LTM adjusted EBITDA in both cases, but the diligence lens differs: payer mix, reimbursement exposure and clinician retention for services; integration depth and switching costs for IT. Practice-level deals below roughly $1M of earnings price on SDE, covered for dental and veterinary practices separately. Caveat: reimbursement-rule changes can reprice a services platform mid-process.

IT services & MSPs

MSPs are priced on EV/LTM adjusted EBITDA with indicative ranges of 4.5–6.0x at $1M–$3M of EBITDA, 5.5–7.5x at $3M–$10M and 7.0–9.5x above that (August 2026 judgment). The share of true monthly recurring revenue under contract is the first question every buyer asks; seat- and endpoint-based agreements with annual escalators support the top of the band, while time-and-materials work prices like project services. PE consolidation remains the dominant buyer dynamic. Caveat: technician retention and documented processes matter more than brand — an MSP whose knowledge lives in two engineers' heads will see it in the multiple.

Business & professional services

Outsourced business services — testing, compliance, facilities-adjacent, tech-enabled back office — price on EV/LTM adjusted EBITDA, with indicative ranges of 4.0–5.5x at $1M–$3M of EBITDA rising to 6.5–8.5x above $10M (August 2026 judgment). Contract recurrence and switching costs separate the winners: multi-year contracted revenue with embedded workflows prices materially above relationship-driven, rebid-every-year work. Partner or founder dependence is the classic discount driver, because the asset that walks out the door was the thing being bought. Caveat: buyers reclassify "recurring" aggressively in diligence — repeat is not recurring, and the multiple moves when that distinction lands.

Manufacturing

Niche and precision manufacturers price on EV/LTM adjusted EBITDA, with indicative ranges of 5.0–7.0x at $3M–$10M of EBITDA and 6.5–8.5x above $10M; automation-exposed industrial products run modestly higher (August 2026 judgment). Proprietary processes, qualified-vendor status and aftermarket or consumables revenue drive premiums; reshoring demand has firmed the category through 2025–2026. EBITDA alone overstates debt capacity here — buyers underwrite EBITDA less maintenance capex, so capital intensity is priced even when the headline multiple looks healthy. Caveat: customer concentration above roughly 30% with a single OEM is the most common reason a manufacturing process ends below the range.

Construction & home services

These are two different markets sharing a jobsite. Commercial and specialty construction prices at indicative 4.0–5.5x in the $3M–$10M EBITDA band, constrained by project risk, bonding and cyclicality. Residential home services — HVAC, plumbing, electrical — price higher, 5.5–7.5x in the same band and 7.0–10.0x above $10M, because consolidators pay for service-agreement bases, route density and technician pipelines (August 2026 judgment). The metric is EV/LTM adjusted EBITDA in both. Caveat: percentage-of-completion accounting and work-in-progress schedules get rebuilt in diligence; a contractor's reported EBITDA rarely survives quality-of-earnings review unchanged.

Logistics & distribution

Asset-light freight brokerage, 3PL and distribution businesses price on EV/LTM adjusted EBITDA, with indicative ranges of 4.5–6.0x for logistics and 5.0–6.5x for distributors in the $3M–$10M EBITDA band (August 2026 judgment). Asset intensity is the first sorting question: asset-heavy trucking prices below brokerage on the same earnings because the EBITDA is not comparable after maintenance capex. Distributors with exclusive lines and entrenched supplier relationships defend the top of the band. Caveat: 2024–2025 freight-cycle earnings require careful normalization — buyers will not pay a full multiple on cyclical peak EBITDA, and sellers anchoring to it stall processes.

Consumer & food

Consumer products and e-commerce brands carry the widest outcome dispersion in the table: indicative 4.0–5.5x at $3M–$10M of EBITDA, with channel-dependent Amazon-native brands below that and durable multi-channel brands above (August 2026 judgment). Food and beverage manufacturing prices more like industrials — 5.0–7.0x in the same band — with co-manufacturers valued on contracts and capacity, and branded producers on velocity and retailer relationships. The metric is EV/LTM adjusted EBITDA throughout. Caveat: tariff and supply-chain exposure is being underwritten explicitly in 2026; import-dependent margin structures take the discount in the model, not in the narrative.

How to calculate an EBITDA multiple — and turn it into equity value

Indicative enterprise value = LTM adjusted EBITDA × selected EV/EBITDA multiple
Indicative equity value = Enterprise value − funded debt − debt-like items + excess cash ± working-capital adjustment

Worked example. $3.0M of LTM adjusted EBITDA at 6.0x–7.0x implies $18M–$21M of enterprise value. With $2.0M of funded debt and $0.5M of excess cash, pre-other-adjustment equity value is $16.5M–$19.5M. Cash at closing can differ again because of working capital, debt-like items and net debt adjustments, earnouts, rollover equity, escrow, fees and taxes.

Indicative valuation calculator

What moves the multiple: the Windsor Drake six-driver framework

Buyers do not price companies with adjustment grids, and neither does this page. Published "+0.5x for recurring revenue" tables double-count factors that interact and imply a precision the market does not offer. What actually happens: each driver group below shifts the credible buyer pool and the risk case, and the interaction of all six — plus process competition — determines where inside or outside the band a company clears.

When an EBITDA multiple is the wrong tool

An EBITDA multiple assumes positive, normalized, cash-representative earnings and a buyer underwriting them. Several situations break that assumption:

• Early-stage or negative-EBITDA SaaS. There is no earnings base to multiply. Buyers use ARR and revenue multiples with efficiency screens instead — see ARR multiple versus EBITDA multiple.
• Banks, lenders and balance-sheet financials. Interest is the business, not a financing cost below the line. These price on earnings, book value and portfolio quality; EBITDA is close to meaningless.
• Real-estate-heavy businesses and REITs. Value sits in the assets; cap rates, FFO and appraisal methods govern, with the operating business valued separately from the property.
• Owner-operated Main Street businesses. Below roughly $1M of earnings, SDE is the market's metric because the buyer is buying a job plus a return — a different economic object.
• Capital-intensive operations. EBITDA ignores the capex required to keep revenue flat. Buyers shift to EBITDA-less-maintenance-capex or EBIT, and so should the seller's expectations.
• Distressed or turnaround situations. With impaired earnings, value derives from assets, revenue, or post-fix potential — priced through structure rather than a headline multiple.

Public comps versus private transaction pricing

Public-company EV/EBITDA data is a legitimate input and a terrible shortcut. NYU Stern's January 2026 dataset puts US public companies at a 19.7x average EV/EBITDA across firms with positive EBITDA, with enormous sector spread — oil and gas production at 5.2x, telecom services at 6.5x, healthcare products at 19.8x, application and systems software at 24.5x. Those are trading multiples: minority-share prices for large, liquid, diversified companies with public reporting — not what a control buyer pays for a private company.

This page does not apply a blanket "private-company discount" to public multiples, because no defensible universal percentage exists. The honest method is to build the private benchmark from private-market evidence — completed control transactions such as GF Data's middle-market sample — and treat public comps as context for sector sentiment and relative positioning. When comparing any two multiples, hold five distinctions straight: trading comps versus precedent control transactions; announced versus closed deals; platform versus add-on pricing; strategic versus financial buyers; and LTM versus NTM earnings. Mixing any pair quietly changes the number by turns, not decimals.

Normalizing adjusted EBITDA (and why "GAAP EBITDA" isn't a thing)

EBITDA and adjusted EBITDA are non-GAAP measures — no accounting standard defines them, which is exactly why the definition gets negotiated. The SEC's non-GAAP guidance governs how public companies present such measures and reconcile them to GAAP results; in private deals, the discipline it encodes still applies: every adjustment must reconcile to the financial statements and survive scrutiny.

Standard normalizations include above- or below-market owner compensation, personal expenses run through the business, one-time legal or transaction costs, non-recurring revenue or losses, rent adjusted to market for related-party real estate, and pro forma effects of changes already made. Buyers accept adjustments they can verify and reject narratives. Before a process, the credible move is a sell-side quality of earnings review, and a defensible bridge showing how buyers normalize adjusted EBITDA line by line. The gap between reported (unadjusted) EBITDA and a well-supported adjusted figure is often the cheapest EBITDA a seller will ever add — and an unsupported add-back list is the fastest way to lose pricing credibility in diligence.

Methodology and source ledger

This section is the evidence contract for the page. Every number above is either observed (taken directly from a cited source), calculated (arithmetic on stated inputs), or Windsor Drake analyst judgment (an indicative range that is not a computed statistic). The approach follows the same logic as precedent transaction analysis: the value of a benchmark depends entirely on the universe behind it.

Geography and currency

United States and Canada; all figures in USD. NYU Stern data covers US public companies; BizBuySell covers US Main Street transactions; GF Data covers North American PE-backed deals.

Transaction status

GF Data figures are completed transactions; BizBuySell figures are closed sales reported by brokers; NYU Stern figures are trading data, not transactions. Windsor Drake's indicative ranges are informed by closed-deal sources and by live process behavior (offers and LOIs), and are labeled judgment precisely because they are not a closed-deal sample.

Measurement period and earnings basis

All EBITDA multiples on this page use trailing (LTM/TTM) adjusted EBITDA unless a row states otherwise. No forward (NTM) multiples are quoted. Each table states its source period; the page-level data cutoff is Q2 2026.

Enterprise-value and EBITDA scope

Enterprise value (TEV) is cash-free, debt-free total consideration. EBITDA means adjusted EBITDA as defined in the normalization section. The benchmark table's bands are earnings bands ($1M–$3M, $3M–$10M, $10M+ LTM adjusted EBITDA); implied enterprise values run roughly $3M–$300M, within GF Data's $1M–$500M TEV middle-market universe. The size-effect table uses TEV brackets and is labeled as such; the two segmentations are never mixed.

Reported versus adjusted EBITDA

"Reported EBITDA" or "unadjusted EBITDA" means the figure before normalization. EBITDA in any form is a non-GAAP measure; there is no "GAAP EBITDA." Adjustments must reconcile to financial statements.

Buyer and deal mix

GF Data reflects PE platform and add-on control deals by contributing sponsors. BizBuySell reflects Main Street sales, mostly to individual buyers. Windsor Drake's judgment ranges assume a competitive process with both strategic and financial participants; single-buyer negotiations routinely price below them.

Statistic definitions

Observed figures are labeled with their statistic (averages, medians) as published by the source. Windsor Drake's ranges are indicative ranges — not means, medians or interquartile ranges — and this page does not claim percentile precision anywhere. The three statistics are never interchanged.

Observation counts and minimum sample

Sample sizes are shown wherever a source publishes them (80 deals, GF Data Q1 2026; 2,117 sales, BizBuySell Q2 2026; 118 deals, GF Data H1 2025 small-deal set). No observation counts are claimed for judgment ranges. If Windsor Drake later publishes computed cells from licensed data, cells below a minimum sample will be suppressed and the rule disclosed here.

Outliers and negative EBITDA

Outlier treatment for observed figures follows each publisher's methodology. Judgment ranges exclude distressed and negative-EBITDA situations, which are covered qualitatively in the section on when EBITDA is the wrong tool.

Leases, minority interests and debt-like items

In the equity bridge, finance leases, earnouts owed, deferred compensation, unfunded liabilities, pending settlements and similar obligations are treated as debt-like items. Minority interests and pension obligations, where present, are debt-like in the bridge as well.

Licensing and value status

Public sources are cited with attribution and links; no licensed row-level dataset is reproduced here. Every value on the page carries one of three statuses — observed, calculated, or analyst judgment — per the ledger below.

Known biases

GF Data is contributed by participating PE firms (selection bias toward completed, sponsor-led deals). BizBuySell is voluntary broker reporting (disclosure bias). Public-company data reflects survivorship. Windsor Drake's deal flow concentrates in the sectors marked "Moderate" confidence, which is why other sectors are marked "Indicative."

Evidence ledger

EBITDA multiple questions, answered directly

What is a good EBITDA multiple by industry?

One that clears the top of your sector-and-size band in a competitive process. As orientation: PE-backed middle-market deals averaged 7.3x in Q1 2026 (GF Data), most lower-middle-market services sectors carry indicative ranges of roughly 4x–7x, and premium recurring-revenue sectors reach 9x–13x at $10M+ of EBITDA (Windsor Drake judgment). "Good" is relative to the right benchmark, never an absolute number.

How many times EBITDA is a business worth?

Most private companies in the $1M–$10M EBITDA range transact around 3x–8x LTM adjusted EBITDA on an enterprise-value basis, with sector, size and revenue quality setting the position in that span. Smaller Main Street businesses trade lower on a different metric — 2.7x average cash flow (SDE) in Q2 2026 per BizBuySell — and premium sectors at scale trade above it.

Which industries receive the highest EBITDA multiples?

Sectors combining recurring revenue, high margins and low capital intensity: profitable B2B SaaS, healthcare IT, fintech and payments, insurance brokerage and cybersecurity services, with indicative ranges of 9x–13x at $10M+ of EBITDA (Windsor Drake judgment, August 2026). Public-market data shows the same ordering — software at 24.5x EV/EBITDA versus oil and gas production at 5.2x (NYU Stern, January 2026).

What is a reasonable EBITDA multiple for a small business?

Below roughly $1M of earnings, the market prices seller's discretionary earnings rather than EBITDA: BizBuySell's Q2 2026 average was 2.7x cash flow across 2,117 closed sales. In the $1M–$3M adjusted EBITDA band, indicative enterprise-value ranges run roughly 3x–5.5x for most sectors (Windsor Drake judgment). A "reasonable" figure is one benchmarked on the correct earnings basis for the company's size.

Why are small-business multiples lower?

Fewer credible buyers, less available financing, heavier key-person and customer concentration, and thinner management and systems — each raises the buyer's risk, and price compensates for risk. The effect is measurable: GF Data's H1 2025 small-deal analysis shows sub-$10M-TEV deals near 5.5x–5.6x against 6.2x–6.7x for the $10M–$25M bracket, a persistent gap of nearly a full turn.

What is adjusted EBITDA?

Earnings before interest, taxes, depreciation and amortization, normalized to show the business's ongoing earning power under new ownership: owner compensation reset to market, personal and one-time expenses removed, related-party rent adjusted, non-recurring items excluded. It is a non-GAAP measure, so the definition is negotiated in every deal — and every adjustment must reconcile to the financial statements to survive diligence.

What is the difference between SDE and EBITDA?

SDE adds the owner's full compensation and benefits back to earnings, because a Main Street buyer replaces the owner and captures that pay. EBITDA instead charges a market salary for the management the business needs, because a financial or strategic buyer must hire it. The same company can show SDE far above its EBITDA — which is why a 2.7x SDE figure and a 6x EBITDA figure can describe similar economics.

How do I convert enterprise value to equity value?

Start with enterprise value, subtract funded debt and debt-like items (finance leases, earnouts owed, deferred compensation, unfunded liabilities), add excess cash, then apply the working-capital adjustment against the negotiated target. The result is indicative equity value. Cash actually received at closing differs again for escrow, rollover equity, transaction fees and taxes — model those before accepting any headline number.

Should I use LTM or forward EBITDA?

Private-company transactions in this market price on trailing twelve-month (LTM/TTM) adjusted EBITDA — GF Data's benchmarks are TTM-based, and this page follows that convention. Public comps are often quoted on forward (NTM) estimates, which are systematically higher-denominator and therefore lower multiples. Never compare an LTM private multiple to an NTM public one without saying so; the basis changes the number materially.

Are EBITDA multiples before or after debt?

Before. An EV/EBITDA multiple prices enterprise value — the whole capitalization, independent of how the current owner financed it. The company's existing debt does not change its enterprise value; it changes how that value splits between lenders and shareholders. Sellers receive equity value: enterprise value minus debt and debt-like items, plus excess cash, adjusted for working capital.

Can I use an EBITDA multiple if EBITDA is negative?

No — a negative base makes the arithmetic meaningless. If losses are temporary and well-explained, buyers may underwrite a normalized or run-rate EBITDA, with proof. Otherwise the market shifts metrics: ARR or revenue multiples for recurring-revenue software, asset-based approaches for tangible-asset businesses, and structured deals (earnouts, contingent pricing) where value depends on a recovery a buyer won't prepay for.

Does a competitive sale process increase the multiple?

Competition is the mechanism that moves a company from the bottom of its credible range toward the top — a single negotiated buyer has no reason to pay a clearing price. No honest universal premium figure exists, and this page does not publish one: the effect depends on how many qualified buyers genuinely compete and how well the process sustains that tension through diligence. Directionally, it is one of the few drivers a seller fully controls.

Related terms this page deliberately does not cover

EBITDA margin by industry measures profitability — EBITDA as a percentage of revenue — not valuation, and benchmarking it is a different exercise. For what counts as a strong margin profile, see how much EBITDA is good.

Rule of 40 is a SaaS efficiency screen (growth rate plus profit margin ≥ 40), not a valuation multiple. Where it intersects pricing, the mechanics are covered in ARR multiple versus EBITDA multiple.

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Related research

• Business valuation methods for private companies — where multiples fit among DCF, precedent transactions and asset approaches.
• How to price a business for sale — turning a benchmark range into an asking strategy.
• EBITDA vs. adjusted EBITDA — the definitional gap that moves every multiple conversation.