Ask most UK M&A advisors how a lower-mid-market business should be valued and you'll get a rule of thumb: "professional services trade at 3.5-5.5x EBITDA," "recurring-revenue businesses command a premium," and so on. These ranges aren't wrong, exactly — they're just not evidence. They're an average of an average, rarely tied to a specific, disclosed, comparable transaction.
What a rule of thumb actually is
A sector-multiple guide is a reasonable starting estimate when nothing better exists. It is not, however, evidence a buyer or seller can interrogate. If a seller asks "why 4.5x and not 6x," the honest answer is often "because that's roughly what this sector tends to go for" — not "because these three comparable businesses, of similar size, in the same sub-vertical, sold at that multiple last year."
What a real comp requires
A genuine comparable transaction needs a disclosed price, a disclosed (or derivable) EBITDA, a real company, and a real source — a regulatory announcement, trade press, an administrator's sale notice, or a disclosed Companies House filing. Anything short of that is a guess wearing a decimal point.
- A named, real transaction — not an anonymised industry average
- A disclosed or derivable price and EBITDA, so the multiple is computed, not asserted
- A citable source another person could go and check
- A recency and size band close enough to the business being valued that the comparison actually holds
Why this is harder than it sounds — and why most platforms skip it
Individual-transaction-level UK SME data isn't free. The large commercial databases (Refinitiv, PitchBook, Capital IQ, Bureau van Dijk) are subscription products built for institutional deal teams, not a lower-mid-market advisory practice. That's precisely why most tools default to a static multiple table and call it "market data."
Handover's comps engine is built to be honest about this rather than paper over it. Every comparable transaction on the platform carries a mandatory source reference and an exact supporting quote — no source, no save. A range with only one or two comps behind it is shown with a low-confidence label and the record count, not smoothed into something that looks more certain than it is. Where there isn't enough real data yet, the platform says so, rather than defaulting to the old rule-of-thumb table and presenting it as market intelligence.
The result is a valuation range that's honest about its own evidence base — sometimes backed by real, cited transactions, sometimes an explicitly labelled operator estimate, and never blended together as if they were the same thing.