Small business valuation multiples, 2026.
In brief
In Q2 2026, IBBA advisors reported 2.0× SDE for businesses valued under $500,000, 2.8× from $500,000 to $1 million, 3.1× from $1 million to $2 million, 4.0× EBITDA from $2 million to $5 million and 5.8× EBITDA from $5 million to $50 million. This page adds four years of history, how deals were paid for, and country-adjusted multiples for Canada and 18 Latin American markets.
Table 1
Multiples by deal size, 2023 to 2026.
Smaller businesses sell on seller’s discretionary earnings, larger ones on EBITDA. The biggest band moved from 4.8× to 5.8× EBITDA over four years; the smallest stayed at 2.0× to 2.3× SDE.
| Enterprise value | Earnings basis | Q2 2023 | Q2 2024 | Q2 2025 | Q2 2026 |
|---|---|---|---|---|---|
| Under $500K | SDE | 2.0× | 2.0× | 2.3× | 2.0× |
| $500K-$1M | SDE | 2.8× | 2.8× | 2.8× | 2.8× |
| $1M-$2M | SDE | 3.0× | 2.8× | 3.0× | 3.1× |
| $2M-$5M | EBITDA | 4.5× | 3.5× | 3.9× | 4.0× |
| $5M-$50M | EBITDA | 4.8× | 5.3× | 5.5× | 5.8× |
Source: IBBA and M&A Source, Market Pulse Q2 2026 Highlights. Under $2M priced on seller’s discretionary earnings (SDE); $2M to $50M on EBITDA.
Table 2
How deals were paid for.
| Enterprise value | Cash at close | Seller financing | Earnout | Retained equity |
|---|---|---|---|---|
| Under $500K | 88% | 11% | 1% | 0% |
| $500K-$1M | 92% | 6% | 1% | 0% |
| $1M-$2M | 91% | 7% | 1% | 0% |
| $2M-$5M | 84% | 9% | 1% | 0% |
| $5M-$50M | 83% | 6% | 7% | 4% |
Source: IBBA and M&A Source, Market Pulse Q2 2026. Cash at close includes senior debt and buyer equity. The $2M to $5M bar sums to 94% as published.
Table 3
Country-adjusted multiples: Canada and Latin America.
We found no public source that reports small-business deal multiples country by country across the region. These estimates carry the U.S. multiple across borders through the one input that is published for every country, its equity risk premium.
Mexico Brazil Colombia Chile Peru Argentina Canada
| Country | Moody’s | Country risk premium | Under $500K SDE | $500K-$1M SDE | $1M-$2M SDE | $2M-$5M EBITDA | $5M-$50M EBITDA |
|---|---|---|---|---|---|---|---|
| United States | Aa1 | 0.23% | 2.0× | 2.8× | 3.1× | 4.0× | 5.8× |
| Canada | Aaa | 0.00% | 2.0× | 2.8× | 3.1× | 4.0× | 5.8× |
| Mexico | Baa2 | 2.46% | 1.91× | 2.64× | 2.9× | 3.67× | 5.14× |
| Guatemala | Ba1 | 3.24% | 1.89× | 2.58× | 2.84× | 3.57× | 4.94× |
| El Salvador | B3 | 8.41% | 1.72× | 2.28× | 2.47× | 3.01× | 3.93× |
| Honduras | B1 | 5.83% | 1.8× | 2.42× | 2.64× | 3.27× | 4.38× |
| Costa Rica | Ba2 | 3.90% | 1.86× | 2.54× | 2.78× | 3.49× | 4.78× |
| Panama | Baa3 | 2.85% | 1.9× | 2.61× | 2.87× | 3.62× | 5.04× |
| Dominican Republic | Ba2 | 3.90% | 1.86× | 2.54× | 2.78× | 3.49× | 4.78× |
| Jamaica | Ba3 | 4.66% | 1.84× | 2.49× | 2.73× | 3.4× | 4.62× |
| Trinidad and Tobago | Ba2 | 3.90% | 1.86× | 2.54× | 2.78× | 3.49× | 4.78× |
| Colombia | Baa3 | 2.85% | 1.9× | 2.61× | 2.87× | 3.62× | 5.04× |
| Ecuador | Caa3 | 12.95% | 1.59× | 2.06× | 2.22× | 2.65× | 3.34× |
| Peru | Baa1 | 2.07% | 1.93× | 2.66× | 2.93× | 3.73× | 5.24× |
| Bolivia | Ca | 15.54% | 1.53× | 1.96× | 2.1× | 2.48× | 3.07× |
| Brazil | Ba1 | 3.24% | 1.89× | 2.58× | 2.84× | 3.57× | 4.94× |
| Paraguay | Baa3 | 2.85% | 1.9× | 2.61× | 2.87× | 3.62× | 5.04× |
| Uruguay | Baa1 | 2.07% | 1.93× | 2.66× | 2.93× | 3.73× | 5.24× |
| Argentina | Caa1 | 9.71% | 1.68× | 2.21× | 2.4× | 2.9× | 3.74× |
| Chile | A2 | 1.10% | 1.97× | 2.73× | 3.02× | 3.87× | 5.52× |
Method: adjusted multiple = 1 / (1 / U.S. multiple + country risk premium in excess of the U.S.), floored at the U.S. figure. Country risk premiums: Damodaran, January 2026 (rating-based). U.S. base: IBBA Market Pulse Q2 2026. Derived by GLZR Group.
Table 4
Financing parameters in force.
| Parameter | Value | As of / effective | Source |
|---|---|---|---|
| U.S. bank prime rate | 7.00% | 2026-09-22 | Federal Reserve H.15 Selected Interest Rates, bank prime loan |
| SBA 7(a) maximum variable rate, loans over $350,000 | 10.00% | 2026-09-22 | Prime + 3.00% (SBA) |
| Canadian prime rate | 4.45% | 2026-09-16 | Bank of Canada, prime rate (series V80691311) |
| SBA 7(a) maximum loan | $5,000,000 | 2026-09-23 | U.S. Small Business Administration |
| Minimum equity, initial acquisition | 10% | 2026-10-01 | SBA SOP 50 10 8.1 |
| Minimum debt service coverage | 1.15x | 2026-10-01 | SBA SOP 50 10 8.1 |
| Maximum amortization, change of ownership | 10 years | 2026-10-01 | SBA SOP 50 10 8.1 |
| Quality of Earnings required from | $3,000,000 purchase price | 2026-10-01 | SBA SOP 50 10 8.1 |
Table 5
What a business loan costs, by country.
The rate the calculators assume for a local-currency acquisition loan, and where it comes from. Every default can be overridden; borrowing in U.S. dollars instead costs 9.50% but adds currency risk.
| Country | Policy rate | Default loan rate | World Bank avg. lending rate | Source |
|---|---|---|---|---|
| United States | prime | 9.50% | — | Federal Reserve H.15, prime |
| Canada | prime | 6.95% | — | Bank of Canada, prime |
| Mexico | 6.50% (2026-08) | 12.00% | 8.79% (2025) | BIS central bank policy rates |
| Guatemala | 3.50% (2026-08-26, reported) | 9.00% | 12.85% (2025) | Decision reported by Prensa Libre |
| El Salvador | none | 9.50% | n/a | Dollarized economy: Federal Reserve H.15, prime |
| Honduras | 6.00% (2026-09-21, reported) | 11.50% | 18.58% (2025) | Decision reported by La Tribuna and Infobae |
| Costa Rica | 3.00% (2026-07, reported) | 8.50% | 6.88% (2025) | Decision reported by Infobae |
| Panama | none | 9.50% | 6.91% (2022) | Dollarized economy: Federal Reserve H.15, prime |
| Dominican Republic | 5.25% (2026-08, reported) | 10.75% | 15.25% (2024) | Decision reported by Diario Libre and Infobae |
| Jamaica | 5.50% (2026-08-19) | 11.00% | 12.14% (2025) | BOJ monetary policy press release, August 2026 |
| Trinidad and Tobago | 3.50% (2026-06-26) | 9.00% | 7.50% (2024) | CBTT monetary policy announcement |
| Colombia | 12.00% (2026-08) | 17.50% | 14.31% (2025) | BIS central bank policy rates |
| Ecuador | none | 9.50% | n/a | Dollarized economy: Federal Reserve H.15, prime |
| Peru | 4.25% (2026-08) | 9.75% | 12.60% (2022) | BIS; BCRP series PD04722MM |
| Bolivia | none | 10.19% | 10.19% (2025) | World Bank, lending interest rate (no policy rate) |
| Brazil | 14.00% (2026-08) | 19.50% | 45.33% (2025) | BIS central bank policy rates |
| Paraguay | 5.50% (2026-09-22, reported) | 11.00% | 12.51% (2021) | Decision reported by La Nación (Paraguay) |
| Uruguay | 5.75% (2026-04-21) | 11.25% | 10.06% (2025) | BCU press release (unchanged in September 2026 reporting) |
| Argentina | none | 46.02% | 46.02% (2025) | World Bank, lending interest rate (no policy rate) |
| Chile | 4.50% (2026-08) | 10.00% | 4.18% (2018) | BIS central bank policy rates (held at 4.5% on 8 Sep 2026) |
Default business-loan rate: published prime + 2.50 points in the U.S. and Canada; elsewhere the central bank's policy rate + 5.50 points, the same spread the U.S. default carries over the Fed's upper target (prime is target + 3.00). Without a policy rate (Argentina, Bolivia) the World Bank average lending rate is used; dollarized economies (Ecuador, El Salvador, Panama) use the U.S.-dollar rate. Every default can be overridden. World Bank series: lending interest rate (FR.INR.LEND), an average across all borrowers, shown for context. “Reported” marks decisions read from named news outlets because the central bank’s page blocks automated reads.
Downloads
Use the data.
Use the data. The country-adjusted multiples are GLZR Group’s own estimates and, with the SBA parameters, are licensed CC BY 4.0: reuse them freely and credit GLZR Group. The deal-size multiples and financing mix are figures reported by IBBA and M&A Source, compiled here with attribution; cite them to IBBA and M&A Source Market Pulse.
Cite as: GLZR Group, “Small business valuation multiples, 2026”, version 2026-09, https://glzrgroup.com/valuation-multiples/
Method
- Multiples and financing mix: values printed on the IBBA Market Pulse Q2 2026 highlights charts, read from the published PDF.
- Country adjustment: implied capitalization rate (1 / multiple) plus the country’s rating-based risk premium in excess of the U.S. premium, floored at zero, inverted back to a multiple.
- SBA parameters: quoted from SOP 50 10 8.1 (effective 1 October 2026) and sba.gov. Rates from the Federal Reserve H.15 release and the Bank of Canada.
Limitations
- IBBA figures are advisor-reported survey results; the highlights do not state median or mean, and do not split by sector.
- Country-adjusted multiples are derived estimates, not observed transactions. They ignore currency, inflation and local credit.
- Cuba and Venezuela are excluded.
Questions
Asked about the data.
What is the average multiple for a small business in 2026?
IBBA advisors reported, for Q2 2026: 2.0x SDE under $500,000, 2.8x from $500,000 to $1 million, 3.1x from $1 million to $2 million, 4.0x EBITDA from $2 million to $5 million and 5.8x EBITDA from $5 million to $50 million. The highlights do not state whether these are medians or means.
Are valuation multiples lower in Latin America?
Buyers generally demand a higher return for higher country risk, which lowers the multiple. Applying Damodaran's January 2026 country risk premiums to the U.S. figures lowers a 4.0x EBITDA multiple to 3.67x in Mexico, 3.57x in Brazil, 3.87x in Chile and 2.90x in Argentina. These are GLZR Group's derived estimates, not observed deal data.
What multiple do businesses sell for in Mexico?
GLZR Group's country-adjusted estimate, applying Damodaran's January 2026 country risk premium for Mexico (2.46%) to the Q2 2026 U.S. multiples: 2.64x SDE for businesses valued $500,000 to $1 million, 2.90x SDE from $1 million to $2 million, 3.67x EBITDA from $2 million to $5 million and 5.14x EBITDA from $5 million to $50 million. These are derived estimates, not observed Mexican deal prices.
What multiple do businesses sell for in Brazil?
Applying Brazil's country risk premium of 3.24% (Damodaran, January 2026) to the Q2 2026 U.S. multiples gives 2.58x SDE from $500,000 to $1 million, 2.84x SDE from $1 million to $2 million, 3.57x EBITDA from $2 million to $5 million and 4.94x EBITDA from $5 million to $50 million. These are GLZR Group estimates derived from public data.
Are small business multiples in Canada the same as in the U.S.?
In this dataset, yes. Canada's country risk premium is 0.00% (Aaa), below the U.S. premium of 0.23%, and the method never adjusts upward from IBBA's national survey, so Canada carries the same multiples: 2.0x to 3.1x SDE under $2 million and 4.0x to 5.8x EBITDA from $2 million to $50 million.
What interest rate should I assume for an acquisition loan in Latin America?
A local bank loan is priced off the central bank's policy rate. GLZR Group's calculators assume the policy rate plus 5.5 points, the same spread a U.S. bank loan carries over the Federal Reserve's target: 12.00% in Mexico, 17.50% in Colombia, 19.50% in Brazil, 10.00% in Chile and 9.75% in Peru. Argentina has had no policy rate since mid-2025, so the World Bank's 2025 average lending rate of 46.02% is used. Borrowing in U.S. dollars costs 9.50% but exposes the loan to the local currency.
How were small business acquisitions financed in 2026?
Mostly cash at close. In Q2 2026, cash at close (senior debt and buyer equity) was 83% to 92% of the price by size band, seller financing 6% to 11%, and earnouts 1%, except 7% for deals from $5 million to $50 million, which also carried 4% retained equity.
More tools