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Will this be the year you seriously drive up the value of your company?

Posted by Paul Visokey on Fri, Jan 20, 2017 @02:43 PM

 

If you have resolved to make your company more valuable in 2017, you may

want to think hard about how your customers pay.

If you have a transaction business model where customers pay once for what

they buy and do not return, expect your company’s value to be a low single-digit multiple of your

Earnings Before Interest Taxes, Depreciation and Amortization (EBITDA).

If you have a recurring revenue model, by contrast, where customers subscribe

and pay on an ongoing basis, you can expect your valuation to be a multiple of

your revenue.

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Topics: Recurring Revenue