Vacation Rental Management Co. Calculator
Have you considered selling your Vacation Rental Management company? Do you want to know what it’s worth? Fill in the following information and you’ll get a good idea!
There are many methods of valuing companies. In this calculator, we will use a combination of two valuation methods to determine the value of your business.
Multiple of Revenue and Multiple of EBITDA.
Valuation Method 1 - Multiple of Revenue
One method for valuing a vacation rental management company is the Multiple of Revenue Method. The typical value of your company is often about a 1 x multiple of your trailing twelve months (TTM) "gross margin". The "gross margin" is your commissionable revenue plus all of your ancillary fees (housekeeping, guest fees, etc...). The value of your company is typically plus or minus 10% of this number.
Valuation Method 2 - Multiple of EBITDA
Another popular method for valuing a vacation rental management company is the Multiple of EBITDA Method. Most vacation rental companies fall in the 2-5 X multiple of your trailing twelve months adjusted EBITDA. An important consideration to take into account are “add-backs”. Add-backs are expenses on the books that would have gone towards profit. Examples of add-backs are personal vehicles that the company pays for, “work trips”, meals and entertainment, etc… These add-backs can get quite subjective and often negotiated.
Below is a summary of the two methods. This will give you a good range of the value of your vacation rental management company. Please consult with one of our M&A Consultants for details and strategies on how you can prepare your company to maximize your exit price.
*Estimates are based on historical industry standards and for informational purposes only. Each deal is unique. Please consult with one of our M&A specialists for more information.