Answers · updated 30 Aug 2026
Every answer here is arithmetic you can check, with the published source and the date next to each figure. Each page carries the free Ballpark Score, so you can run the numbers on your own business while you read.
A bootstrapped software business is worth its annual owner earnings times a multiple set by its size, then moved up or down by five things a buyer checks. At $10,000 MRR with median metrics that lands near $301,000 — 2.5x annual revenue.
Read the answer→Owner-operated software under $1M ARR trades at roughly 2x–4x owner earnings in 2026, rising with size. The headline multiples you read about — 6x, 8x, 12x revenue — are set on venture-funded companies a hundred times larger and do not apply to you.
Read the answer→A $10,000 MRR business with median metrics — 2.5% monthly growth, 3.2% churn, 85% margin, 30 months live, no customer above 20% — values at $274,000–$328,000. Here is every step of that calculation.
Read the answer→Check the offer against a defensible range for your own metrics before you answer anything, then read the structure — how much is cash at close. A fair headline number paid 40% at close over two years is not a fair offer.
Read the answer→On a $301,000 business, moving the largest customer from 15% to 42% of revenue costs about $66,000. Revenue does not change; the buyer's view of how durable it is does.
Read the answer→Each percentage point of monthly revenue churn moves valuation by roughly 20%. On a $301,000 business, going from 3.2% to 4.7% monthly churn costs about $90,000.
Read the answer→Four steps, in this order: get a defensible number, fix the two drags worth the most, write the memo, then reach buyers. Run it backwards and you concede in diligence what $136,500 of preparation would have defended.
Read the answer→A number with no reasoning attached cannot be defended in a negotiation, and revenue is the input that hides the most. Two businesses at $10,000 MRR here are worth $301,000 and $164,500 — a $136,500 difference a revenue multiple cannot see.
Read the answer→SDE — seller's discretionary earnings — is the cash the business puts in its owner's hands in a year. A $10,000 MRR business at 85% margin earns $84,000 of it, and the price is a multiple of that figure, not of the $120,000 of revenue.
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