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One of the first questions every owner asks is, “What is my cleaning business worth?” Most service-business valuations come down to two profit measures — SDE and EBITDA — multiplied by a market multiple. Here is what they mean in plain language.

What is SDE?

Seller’s discretionary earnings (SDE) is the total financial benefit a single owner-operator gets from the business. It starts with net profit and adds back the owner’s salary, one-time expenses, and discretionary costs. SDE is the common yardstick for smaller, owner-run cleaning companies.

What is EBITDA?

EBITDA is earnings before interest, taxes, depreciation, and amortization. Unlike SDE, it does not add back an owner’s salary, because it assumes the company pays market-rate management. EBITDA is typically used for larger businesses that already run with a management team in place.

Which one applies to you?

As a rough rule, smaller owner-operated cleaning companies are valued on SDE, while larger, management-run companies are valued on EBITDA. The bigger and more systematized the business, the more likely a buyer uses EBITDA — and often the higher the multiple.

What drives the multiple?

Two cleaning companies with the same profit can be worth very different amounts. Recurring contract revenue, customer retention, low concentration, a strong team, and clean books all push the multiple up. Heavy owner dependence and one-time work push it down.

At Investera Holdings, we explain valuations in plain language so you understand exactly how we arrived at a number. See our seller FAQ or how our process works.

Thinking about selling?

Investera Holdings buys commercial cleaning and adjacent service businesses across the Midwest, Florida, and the East Coast — as operators, not brokers. Start a confidential, no-obligation conversation on our Sell Your Business page or email [email protected].

If you are thinking about selling your commercial cleaning or janitorial company, it helps to see it through a buyer’s eyes. Here is what serious, operator-minded buyers like Investera Holdings actually focus on.

Recurring, contracted revenue

Month-after-month contract revenue is worth far more than one-off jobs. Buyers want to see signed agreements, predictable billing, and a healthy mix of accounts rather than a few large clients carrying the company.

Customer retention and concentration

Long-tenured customers and low churn signal a healthy business. If a single client makes up a large share of revenue, that concentration is a risk buyers will price in — so spreading revenue across many accounts strengthens your position.

A team that stays

Cleaning is a people business. Supervisors and crews who remain after the sale protect service quality and customer relationships. Buyers value a stable, well-led team and will often build the deal around keeping it.

Clean financials

Organized P&Ls, clear add-backs, and believable margins make diligence faster and valuations higher. Messy books create doubt and slow everything down.

Systems and process

Documented procedures, scheduling and quality-control systems, and anything that lets the business run without the owner all increase value — they reduce the buyer’s risk and make the transition smoother.

Thinking about selling?

Investera Holdings buys commercial cleaning and adjacent service businesses across the Midwest, Florida, and the East Coast — as operators, not brokers. Start a confidential, no-obligation conversation on our Sell Your Business page or email [email protected].

Selling the cleaning company you built is one of the biggest decisions you will make. Done well, it rewards years of hard work, protects your team, and hands your clients to an owner who will care for them. Here is a practical overview of how the process works and how to prepare.

1. Get your numbers in order

Buyers value cleaning businesses primarily on profitability — usually seller’s discretionary earnings (SDE) or EBITDA — and on the quality of your revenue. Before you go to market, organize two to three years of profit-and-loss statements, a current customer list with contract values, and a simple breakdown of recurring versus one-time work. Clean, believable books raise both your valuation and a buyer’s confidence.

2. Understand what makes you valuable

Recurring contracts, strong customer retention, a reliable crew that stays after the sale, and low customer concentration all push your value up. So does anything that makes the business run without you — documented processes, supervisors, and systems.

3. Decide who you want to sell to

Brokers list your business publicly and take a commission, which can expose you to competitors and worry your employees and clients. Selling directly to an operator-buyer like Investera Holdings keeps the process confidential, removes broker fees, and means the business passes to people who actually run cleaning companies.

4. Choose a deal structure

Sales can be all cash, or include seller financing or earnouts that can increase your total proceeds. You can also choose a clean exit or stay on for a transition. The right structure depends on your goals and timeline.

5. Protect your people and reputation

The best buyers keep your crew, honor your name with clients, and invest in the business. Ask any buyer directly what they intend to do with your team — the answer tells you a lot.

Thinking about selling?

Investera Holdings buys commercial cleaning and adjacent service businesses across the Midwest, Florida, and the East Coast — as operators, not brokers. Start a confidential, no-obligation conversation on our Sell Your Business page or email [email protected].

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