EBITDA ANSWER · CURRENT 2026 SOURCES

What is a business with $1 million in EBITDA worth?

Two current Market Pulse tiers map $1 million of normalized EBITDA to $4 million or $5.8 million of enterprise value.

SOURCE-CONSISTENT REFERENCES

Same EBITDA. Different reported markets.

Each result is shown only when its implied enterprise value lands inside the source tier’s own value band.

BROADER LOWER MIDDLE MARKET$4,000,000

$1,000,000 × 4.0×

$2M–$5M reported enterprise-value tier

IBBA / M&A Source Market Pulse · Q2 2026Open the source

BROADER LOWER MIDDLE MARKET$5,800,000

$1,000,000 × 5.8×

$5M–$50M reported enterprise-value tier

IBBA / M&A Source Market Pulse · Q2 2026Open the source

REJECTED CROSS-CHECKExcluded

Tier integrity matters

6.4× PE-platform reference excluded: $6.4M implied value falls below its own $10M tier floor.

We do not force a larger-market multiple onto a calculation that falls below its own source band.

WHAT CHANGES HERE

At $1M, two adjacent value bands fit their own math.

The Q2 2026 Market Pulse reports 4.0× for the $2M–$5M value band and 5.8× for the $5M–$50M band. Both outcomes land inside their respective bands. The cited GF Data platform tier still does not fit because its 6.4× result falls below that source’s $10 million floor.

TURN THE REFERENCE INTO A DECISION

Three checks before treating the number as yours.

Normalize EBITDA

Keep supportable non-recurring and non-operating adjustments. Retain market-rate management compensation for a management-run company.

Reconcile add-backs

Match the real buyer pool

Broader lower-middle-market deals and PE-backed platform acquisitions are not interchangeable, even when the same EBITDA fits both.

Compare all size tiers

Bridge EV to equity

Debt, cash, working capital, fees, rollover, financing, earnouts, and taxes determine what the seller may actually receive.

Model sale proceeds

COMPARE THE SIZE LADDER

What another EBITDA amount maps to.

$1M EBITDA$4,000,000 · $5,800,000 $2M EBITDA$11,600,000 · $12,800,000 $5M EBITDA$29,000,000 · $34,000,000 $10M EBITDA$83,000,000 · $103,000,000

SOURCE CONTRACT

Public aggregates only. No private deal row exposed.

The broader-market reference comes from the IBBA/M&A Source Market Pulse Q2 2026 highlight sheet. PE-backed references come from GF Data’s report through Q3 2025. We preserve the metric, value band, period, and buyer universe; we do not blend the sources into a midpoint or infer an industry adjustment.

IBBA / M&A Source GF Data

COMMON QUESTIONS

$1M EBITDA valuation, without the shortcut.

What is a business with $1 million in EBITDA worth?

Two current Market Pulse tiers map $1 million of normalized EBITDA to $4 million or $5.8 million of enterprise value. These are enterprise-value references, not seller proceeds or a formal appraisal.

Is $1 million of EBITDA considered lower middle market?

It can sit near the lower-middle-market boundary, but earnings alone do not define the market. Enterprise value, buyer universe, management depth, industry, and the company’s ability to run without its owner all matter.

Why are there multiple enterprise-value answers?

The cited sources describe different buyer universes and value bands. We keep those references separate and include only calculations that land inside the source tier from which the multiple came.

Is enterprise value the cash a seller receives?

No. Seller equity value starts with enterprise value and then reconciles debt, cash, working capital, transaction costs, rollover equity, seller financing, earnouts, and taxes.