What should Canadian owners know about private company valuations in 2026?
For privately owned Canadian businesses, understanding how your company is valued has never been more important. Whether you are planning to sell, raise capital or simply assess your performance, staying informed about valuation trends helps you make smarter decisions. Seven insights stand out this year.
1. Multiples are recovering but still fluctuating — earnings-based multiples are rebounding, a more optimistic environment for sellers, though still below recent peaks; revenue-based multiples have softened slightly as buyers emphasize profitability over top-line growth
2. Profit margins remain resilient — many private companies maintain healthy margins despite uncertainty, reflecting strong operational management and cost control that buyers increasingly value
3. Industry averages vary widely — technology and utilities tend to command higher values, while hospitality and food services see lower multiples, so know where your sector stands
4. Bigger businesses attract higher valuations — greater revenue and scale read as less risky, so scaling can significantly improve your valuation and open more favourable exit options
5. Deal structures are evolving — buyers want certainty, so most deals now feature substantial upfront payments and more seller financing, with performance-based earnouts used less frequently
6. Owner compensation reflects size and sector — larger businesses and sectors like healthcare, finance and professional services offer higher compensation; use benchmarks to evaluate pay and plan succession or sale
7. Timelines are stable but price negotiation is rising — selling timelines are relatively consistent, but the widening gap between asking and final prices shows buyers negotiating more aggressively
Key facts: private company valuations in 2026
Earnings multiples are recovering (still below peaks); revenue multiples are softening as profitability matters more
Technology and utilities command higher multiples; hospitality and food services lower
Larger, more profitable businesses earn higher valuations and better exit options
Deals favour upfront cash and seller financing over earnouts, and price negotiation is intensifying
Disclaimer: This article is for general informational purposes only and does not constitute legal, tax or financial advice. Past valuation trends do not guarantee future results; consult qualified advisors regarding your specific circumstances.
