Multiple Calculator
Overview
The Multiple Calculator skill calculates valuation multiples for comparable analysis and valuation work. It computes standard multiples with appropriate sector adjustments and supports both private transaction and public company comparables.
Capabilities
Revenue Multiples
- Calculate EV/Revenue multiples
- Apply growth rate adjustments
- Compute ARR and NTM multiples
- Handle recurring vs. non-recurring revenue
Profitability Multiples
- Calculate EV/EBITDA multiples
- Compute EV/EBIT and P/E ratios
- Handle negative earnings appropriately
- Apply margin adjustments
Sector Adjustments
- Apply sector-specific premiums/discounts
- Adjust for growth rate differences
- Factor in margin profile differences
- Consider market positioning
Multiple Analysis
- Calculate median and mean multiples
- Identify outliers and reasons
- Track multiple trends over time
- Build multiple ranges for valuation
Usage
Calculate Transaction Multiples
Input: Transaction data, financial metrics
Process: Calculate multiples, apply adjustments
Output: Multiple calculations, adjustment notesCalculate Trading Multiples
Input: Public company data, metrics
Process: Compute trading multiples
Output: Public company multiple analysisApply Sector Adjustments
Input: Raw multiples, sector characteristics
Process: Apply appropriate adjustments
Output: Adjusted multiples, methodology notesBuild Multiple Range
Input: Comparable set, weighting criteria
Process: Aggregate and weight multiples
Output: Valuation multiple range, application guidanceCommon Multiples
| Multiple | Use Case | Typical Range (SaaS) | |----------|----------|---------------------| | EV/Revenue | Growth companies | 3x - 15x+ | | EV/ARR | Subscription businesses | 5x - 20x+ | | EV/EBITDA | Profitable companies | 10x - 25x | | P/E | Public companies | 15x - 50x | | EV/Gross Profit | Marketplace businesses | 2x - 8x |
Integration Points
- Comparable Analysis Process: Core multiple calculations
- DCF Analysis: Terminal value multiples
- Comparable Transaction Finder: Calculate found comparables
- Valuation Specialist (Agent): Support valuation work
Adjustment Factors
| Factor | Impact on Multiple | |--------|-------------------| | Growth Rate | Higher growth = higher multiple | | Margin Profile | Higher margins = higher multiple | | Retention (NRR) | Higher retention = higher multiple | | TAM | Larger market = higher multiple | | Competition | Less competition = higher multiple | | Switching Costs | Higher costs = higher multiple |
Best Practices
- Use NTM (next twelve months) for forward multiples
- Adjust for one-time items and normalization
- Consider growth-adjusted multiples (EV/Revenue/Growth)
- Document all adjustments clearly
- Use multiple types appropriate to business stage