Almost any profitable business can be sold. Below roughly $1M of EBITDA, individual buyers, search funders, and operator-buyers are your market. From about $1M to $3M of EBITDA, private equity starts paying attention. Above $3M to $5M, institutional buyers and strategics compete hardest and multiples expand. Size sets the buyer and the multiple, not whether a sale is possible.
Buyer type by business size
| Owner earnings (SDE / EBITDA) | Who buys | Typical process |
|---|---|---|
| Under $250K SDE | Individual buyers, owner-operators | Direct sale, small broker, marketplace |
| $250K to $1M | Individuals, search funds, operator-buyers (WETYR) | Direct or lightly marketed |
| $1M to $3M EBITDA | Lower-middle-market PE, operator-buyers | Advisor or direct process |
| $3M to $10M EBITDA | PE platforms, strategics | Advisor or investment bank |
| $10M+ EBITDA | Strategics, large PE | Full investment-bank auction |
Why size changes your multiple
Larger businesses sell for higher multiples because they carry less risk: more management depth, less owner dependence, more diversified customers, and cleaner systems. A business doing $400K of SDE might trade at 3x; the same business grown to $2M of EBITDA with a real management team can trade at 5x to 7x, because a different, better-funded class of buyer is competing for it. That is why growing earnings and reducing owner dependence before a sale can raise both the multiple and the pool of buyers.
What matters more than raw size
Buyers underwrite quality, not just quantity. A smaller business with recurring revenue, clean books, low customer concentration, and a team that runs without the owner is easier to sell, and sells for more, than a larger business that depends entirely on the founder. If you are below the size a given buyer wants, the fastest path is usually not just more revenue; it is more transferable, less owner-dependent earnings.
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Frequently asked questions
What is the minimum size to sell a business?
There is effectively no minimum if the business is profitable. Businesses with under $100K of owner earnings sell to individual buyers regularly. Size determines the buyer and the multiple, not whether a sale is possible.
How much EBITDA do I need to attract private equity?
Most private equity platforms want at least $1M to $3M of EBITDA for a standalone platform deal. Below that, PE is usually only interested if your business is a tuck-in to something they already own.
Can I sell a business that is barely profitable or breaking even?
Yes, but the buyer pool narrows and the price leans on assets, real estate, or turnaround potential rather than earnings multiples. An operator-buyer that can fix and run it is often the most realistic buyer for a low-profit business.
Does revenue or profit determine what my business is worth?
Profit, specifically normalized owner earnings (SDE or EBITDA), drives value in almost every case. Revenue matters only as it translates into transferable earnings. Two businesses with the same revenue can be worth very different amounts.
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