SaaS valuation calculator

Nearly all SaaS valuations come down to one formula: Valuation = ARR x Revenue Multiple. The maths is easy. The whole game is the multiple. Revenue that repeats can be forecast, and revenue you can forecast is worth more per dollar than a one-time sale. That is why buyers value SaaS on revenue multiples, often before the company turns a profit. This calculator starts from the 2026 private SaaS median of roughly 4.5x ARR . It then moves up or down on the drivers buyers really dig into.

Growing SaaS is typically valued on an ARR (revenue) multiple . Buyers are paying for future growth, often before the company turns a profit. A mature SaaS that grows slowly but earns well may be valued on an EBITDA or seller's discretionary earnings (SDE) multiple instead. That is common for bootstrapped businesses sold on marketplaces. This calculator uses the ARR-multiple method, which fits most growing SaaS firms. If you earn well and grow slowly, an earnings-multiple valuation may give a different, sometimes higher, number.

• Lift net revenue retention. Revenue that grows inside an account - upsells, seats, usage - compounds over time. It is the one number buyers prize most.
• Reduce churn. Even a 1-2 point drop in monthly churn lifts lifetime value, and with it the multiple.
• Protect gross margin. Lean hosting and lean support keep margins in the 75%+ range that buyers reward.
• Balance growth and profitability. Aim to pass the Rule of 40.
• De-risk the product. Code that is clean, written down, and built to scale will survive due diligence. So will a spread of customers, which keeps concentration low. Both earn a premium.

That last point is where engineering meets valuation. Technical debt found during diligence is one of the most common reasons a multiple gets cut. A healthy codebase is a financial asset.