Tag
Recurring revenue
8 pages across every collection.
Article··2 min
How recurring revenue affects valuation
Why contracted revenue is worth two to three times what project revenue is worth, the four tiers buyers actually distinguish, and how to move revenue up a tier before you sell.
Article··2 min
Revenue multiple explained
When turnover is a defensible basis for value, what the ranges actually are by business model, and the two situations where using one costs you money.
Answer··1 min
How much do customer contracts increase value?
Nobody has published a number. What a contract does is convert an assumption a buyer has to make into a fact they can read, and the four terms below decide whether it works.
Answer··2 min
How does recurring revenue affect valuation?
Predictable earnings are worth more, and the finance research supports that. No published study measures how much recurring revenue adds to a small business multiple.
Answer··1 min
What is an ARR multiple?
Annual recurring revenue times a figure between 3 and 8, used for subscription software. Churn and net revenue retention decide where inside that range you land.
Answer··1 min
What is a revenue multiple?
A shortcut that prices a business at a number of times turnover, assuming margin is predictable within a business model. Divide it by your margin to see what it really implies.
Answer··1 min
Why do some companies sell for higher multiples?
Four reasons account for nearly all of it: size, growth, revenue quality and independence from the owner. Only the first has published numbers behind it.
Answer··1 min
What is my company worth based on revenue?
Revenue multiples run from 0.3× to 8× depending on business model — but any revenue multiple is an earnings multiple in disguise, and dividing by your margin reveals which.