If it's a services firm, valuation is typically a multiplier based on EBITDA, usually based on a trailing twelve month average.

Any buyer is going to heavily discount what the business might do over the next 10 years and pay a lot more attention to what it has done over the last 1-3 years and put a multiple on that.

I do valuation for a living.

It is very, very industry dependant.

10 year projections are probably worthless unless you have 10 year revenue generating contracts.

Pm me if you want some free friendly advice. Happy to set up a call.

Lots of good responses here ... but I'll add a few thoughts ...

The first question that has to be answered regarding a business valuation is ... "What's the intended purpose?"

For example, the process of valuating a business for the purpose of putting it on the market can be fundamentally different than the process of valuating a business for the purpose of a divorce settlement.

What makes this frustrating is that all of these different methodologies are technically "correct," but they just may not be used in the correct context.

I live in the world of market valuations - which is the amount that most interested buyers are likely going to be willing to pay to acquire the business. So I tend to look at valuation as a multiple of adjusted EBITDA. That multiple range will depend greatly on the business' industry and size, and will then be further impacted by the business' unique attributes, like owner dependency, customer concentration, transferable processes, asset condition, recurring revenue, etc.