Q3 2025 Private Company Market Update: Valuations Hold, Sector Divergence Deepens
- Ernest Bednarz
- Oct 2
- 3 min read
Missed our Q2 2025 Private Company Market Update? Click here to read!
As the third quarter of 2025 closes, private company valuations remained stable, with EBITDA multiples increasing slightly and revenue multiples edging down. Beneath the headline, however, sector-level gaps continue to widen, reinforcing that valuation outcomes are increasingly industry-specific.
EBITDA Multiples Remain on the Rise
According to Exhibit 1A, the median EBITDA multiple for private company sales held at 3.8x in Q2 2025, rebounding from the 3.2x trough in Q3 2024. The three-quarter trailing average confirms that the market has entered a period of stabilization rather than further decline, even if valuations remain below the 4.8x peak of Q2 2024.
Revenue Multiples Slip, Margins Ease
Net sales multiples declined to 0.57x in Q2 2025, down from 0.70x in Q4 2024, reflecting tempered buyer appetite for top-line growth without profitability. Meanwhile, exhibit 2 shows EBITDA margins eased to 15%, off from 18% in Q3 2024, but still above pre-2022 levels, which typically ranged from 11%–15%.
Sector-Level Multiples Highlight Divergence
Exhibit 3 highlights the ongoing divergence in sector valuations. At the high end, the Information sector continues to command premium multiples, with a long-term median of 10.8x, while Utilities also remain elevated at 8.2x. On the other side of the spectrum, industries such as Accommodation & Food Services (2.6x) and Other Services (3.1x) consistently trade at significant discounts. Notably, Finance & Insurance has emerged as a recent standout: over the last twelve months, the sector posted a median multiple of 10.9x, well above its 7.5x all-time median. This surge underscores sustained investor appetite for financial services businesses, and the growth potential buyers see in the sector.
Yearly Sector Comparisons Highlight Diverging Paths
Exhibit 10 illustrates how sector-level multiples shifted year over year. From 2023 to 2024, Transportation & Warehousing, along with Real Estate, Rental & Leasing, posted the strongest gains, with median EBITDA multiples climbing from 3.3x to 4.1x and from 3.2x to 4.0x, respectively. These increases highlight investor confidence in industries tied to logistics, infrastructure, and asset utilization. By contrast, the Information sector, which had previously been a top performer, saw its median multiple decline from 7.1x to 5.8x. This contraction may signal a normalization in valuations following the post-pandemic technology surge, as buyers recalibrate expectations around growth and recurring revenue models.
Looking Forward in the Private Company Market
While overall EBITDA multiples have steadied into mid-2025, revenue multiples and margins point to a more cautious market. Smaller companies have seen valuation improvement, while larger targets face multiple compression. For buyers and sellers alike, sector positioning, buyer type, and margin resilience remain the defining drivers of deal outcomes.
Data source: DealStats Value Index (Q3 2025) - The DealStats Value Index summarizes valuation multiples and profit margins for private companies that were sold over the past several quarters. Business Valuation Resources (BVR) captures this private company transaction data in its DealStats platform.
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Malahat Valuation Group specializes in business valuation and real estate appraisals to owners of privately owned companies and their professional advisors.
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