How do you value intangible assets when selling your business?

Intangible assets are non‑physical assets such as intellectual property, trademarks, brands, customer lists and non‑compete agreementshttps://www.bdc.ca/en/articles-tools/change-ownership/sell-business/how-to-value-intangible-business-assets#:~:text=1,asset%20is. When selling a business, a professional valuator can establish the company’s total value and help avoid disputeshttps://www.bdc.ca/en/articles-tools/change-ownership/sell-business/how-to-value-intangible-business-assets#:~:text=When%20selling%20a%20business%2C%20it%E2%80%99s,between%20the%20buyer%20and%20seller. Valuators typically calculate a multiple of EBITDA to value the whole company, then subtract the value of net tangible assets to determine goodwill and other intangible assetshttps://www.bdc.ca/en/articles-tools/change-ownership/sell-business/how-to-value-intangible-business-assets#:~:text=The%20most%20common%20method%20of,ability%20to%20generate%20operating%20earnings. In some cases, specific intangible assets are valued separately using methods like the excess earnings method (forecasting cash flows attributable to the asset), the relief‑from‑royalty method (applying comparable royalty rates to forecast revenue) or the cost method (estimating the cost to develop the asset)https://www.bdc.ca/en/articles-tools/change-ownership/sell-business/how-to-value-intangible-business-assets#:~:text=4. Because intangible assets are unique and valuations involve many assumptions, working with credentialed valuators ensures accuracyhttps://www.bdc.ca/en/articles-tools/change-ownership/sell-business/how-to-value-intangible-business-assets#:~:text=When%20selling%20a%20business%2C%20it%E2%80%99s,between%20the%20buyer%20and%20seller. Our experts help you evaluate intangible assets and can answer your specific valuation questions with a friendly, supportive approach.