HR Technology Business — Business Valuation Multiple
EBITDA Valuation Guide · Small & Mid-Sized Businesses
Actual EBITDA multiples can vary materially based on EBITDA size, growth, recurring revenue, margins, customer concentration, owner dependence, geography and other company-specific factors.
Min
5.5×
Typical
7.5×
Max
11×
Revenue Model
Recurring
Capital Intensity
Low
A typical multiple of 7.5× EBITDA reflects mid-market transactions in the $1–$50M revenue range.
Overview
HR technology businesses typically trade at 5.5×–11× EBITDA. Recurring SaaS revenue from employer clients, high switching costs once embedded in payroll and people management workflows, and employment law compliance integration support premium valuations. AI-driven people analytics capability is an emerging competitive differentiator. Employer market cyclicality and payroll software giant competition are the primary risks.
Key Value Drivers
- Recurring SaaS revenue from employer clients
- High switching costs in payroll and people data
- Employment law compliance integration
- AI-driven people analytics capability
- Modular platform with expansion revenue
Key Risks
- Competition from payroll software giants
- Employer market cyclicality
- Data security and GDPR obligations
- Integration complexity with legacy HRIS
- Customer churn at contract renewal
Related Industries
Disclaimer: All multiples are indicative estimates only and are not formal valuations or investment advice. They should not be relied upon for financial decision-making without independent professional advice.