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How to Measure Your Business' Value
Most business valuations are done on EBITDA, which is just how much revenue a company does yearly. Revenue versus cash collected depends on the type of business and can be very close to each other. If you have a service business that's based on recurring revenue and contracts, then you're going to have contracts that are factor into that. Earnings before interest, tax, depreciation, and mortisation or even now these two things are not necessarily the same. For most businesses, this is where coming back to the business valuation, if you're mid market, you're getting six to eight dollars per year.