The short answer: Small cleaning companies sell for about 2.3× SDE or 0.7×, 0.8× revenue, a $500K-revenue firm with $100K SDE prices near $230K. With an SBA 7(a) loan you put down roughly 10% (~$23K) plus closing costs, bonding/insurance replacement, and working capital for payroll. Pay top-of-range only for assignable multi-year contracts and clean W-2 labor.
Purchase price by company size
| Revenue | SDE (~18%) | Price @ 2.30× SDE | Price @ 0.78× rev |
|---|---|---|---|
| $250,000 | $45,000 | $103,500 | $195,000 |
| $500,000 | $100,000 | $230,000 | $390,000 |
| $1,000,000 | $185,000 | $425,500 | $780,000 |
Here the two rules diverge, the SDE method usually governs for smaller, thinner-margin firms, while the revenue method flags higher-margin or contract-rich books. When they disagree, trust SDE and investigate why revenue looks rich. See current comps on the cleaning multiples page.
What moves the multiple
| Pushes multiple up | Pushes multiple down |
|---|---|
| Assignable multi-year contracts | 30-day-cancellable, month-to-month accounts |
| Low customer concentration | One anchor account = most of revenue |
| Properly classified W-2 workforce | 1099 crew with reclassification risk |
| Tenured supervisors, low turnover | Owner personally cleans / high churn |
Down payment & the full cost stack
- Equity injection, ~10% of project cost; a standby seller note can sometimes count toward part of it.
- SBA + closing fees, guaranty fee, packaging, closing costs.
- Bonding & insurance, replace the seller's GL, workers' comp, and janitorial bond before close.
- Working capital, commercial clients pay net-30+; you fund payroll first.
- Classification cleanup, if converting 1099 to W-2, budget the added cost.
Working capital is the sleeper cost
You pay cleaners weekly but bill clients monthly and collect on net-30+. Under-funding working capital is the most common way a profitable cleaning company gets its new owner in trouble.
A worked deal
You buy a company with $500,000 revenue and $100,000 SDE at 2.3×, a $230,000 price.
| Line | Amount |
|---|---|
| Purchase price (2.3× $100K SDE) | $230,000 |
| Equity injection (~10%) | $23,000 |
| SBA 7(a) loan (~90%) | $207,000 |
| Est. annual debt service (10 yr, ~11%) | −$34,200 |
| SDE available | $100,000 |
| Cash flow after debt (pre-owner-wage) | $65,800 |
| DSCR (SDE ÷ debt service) | ~2.9× |
The DSCR clears lender minimums easily because the loan is small relative to earnings, a hallmark of asset-light service deals. Reserve a market wage if you'll manage rather than clean, keep working-capital reserves, and the deal still cash-flows. Model your version in the valuation calculator and read how SBA financing works.
Run this deal with your numbers
Price, down payment, loan payment, and cash flow after debt, instantly.
Frequently asked questions
About 2.3× SDE or 0.7×, 0.8× revenue. A $500K-revenue firm with $100K SDE prices near $230K. With an SBA loan you'd put down ~10% (~$23K) plus closing costs and working capital.
SBA 7(a) generally requires ~10% equity. On a $230K company that's ~$23K, and a standby seller note can sometimes count toward part of it.
About 2.3× SDE is the anchor, range ~2.0×, 3.5×. Pay top-of-range only for assignable multi-year contracts, low concentration, and W-2 labor. Pay less for 30-day accounts and 1099 crews.
Yes, SBA fees, legal and quality-of-earnings diligence, replacement bonding/insurance, working capital for payroll before receivables arrive, and any 1099-to-W-2 reclassification cleanup.
Sources
- Cleaning/janitorial revenue & earnings multiples, BizBuySell Valuation Benchmarks (2025).
- SBA 7(a) equity injection & DSCR standards, sba.gov 7(a) program; SOP 50 10 8.
