Seller's Discretionary Earnings is a measure of the financial benefit available to one working owner, often abbreviated as SDE and used for smaller owner-operated businesses.

What Does Seller's Discretionary Earnings Mean?

A measure of the financial benefit available to one working owner, often abbreviated as SDE and used for smaller owner-operated businesses.

Why Is Seller's Discretionary Earnings Important When Selling an Online Business?

This term can affect how buyers evaluate risk, value, transferability, payment structure, or the practical completion of an online business acquisition. Founders should understand it before entering negotiations or signing transaction documents.

Related Terms

• Adjusted Profit
• Add-Back
• EBITDA
• Valuation Multiple
• Founder Dependency

Next step: Explore the related glossary terms above or request a confidential online business valuation from Company-Seller.