Is this business worth something if I sold it?

Bottomline calculates your SDE and checks whether your business has transferable value beyond your personal effort.

What's my business roughly worth?

Bottomline estimates your business value using SDE multiples based on your industry, size, and growth rate.

Am I working harder for less money?

Bottomline tracks your revenue per hour of effort and compares it to your expenses, showing whether you are scaling or just adding complexity.

What's my annual growth rate?

Bottomline calculates your year-over-year revenue growth rate and shows whether you are accelerating, steady, or decelerating.

Am I better off than I was a year ago?

Bottomline compares your key financial metrics year over year to give you a clear answer on whether your business is improving.

Am I building equity or just earning a salary?

You work 50+ hours a week and the business pays you a salary. But is it also creating something worth more than next month's paycheck? Here's how to tell the difference using your own financial data.

7 min read

The short answer

Are you building equity? Check three things: are your retained earnings growing on the Balance Sheet? Are your margins expanding (not just revenue)? And could the business function for 30 days without you? If all three are yes, you are building equity. If not, you have a well-paying job, not a valuable asset.

The difference between a job and an asset is transferable value

A job pays you as long as you show up. An asset pays you whether you show up or not, and it can be sold to someone else. Many small businesses look like assets on paper but function as jobs. The owner is the sales team, the lead technician, and the relationship holder. Remove the owner and the revenue disappears.

Equity means the business has accumulated value that exists independently of your daily labor. This shows up in retained earnings on the balance sheet, in margins that expand as the business grows, and in systems and employees that generate revenue without the owner touching every deal.

There is nothing wrong with running a business that is essentially a high-paying job. But you should know which one you have, because the financial decisions are different.

Three tests that separate equity-building from salary-earning

Retained earnings growth. Is the business accumulating profit over time, or does every dollar of profit get withdrawn as owner distributions? Check your Balance Sheet. Growing retained earnings = growing equity.
Margin expansion with growth. As revenue grows, are margins expanding (each dollar produces more profit) or are they flat (every dollar of growth requires a dollar of cost)? Expanding margins mean operational leverage. Flat margins mean you are just scaling effort.
Owner independence.Could the business produce revenue for 30 days without you? If yes, the business has transferable value. If no, the “equity” is really just your future labor, and it disappears when you do.

How to run the equity test in QuickBooks or Xero

1
Check retained earnings on the Balance Sheet
In QuickBooks: Reports→ “Balance Sheet” as of today. Find Retained Earnings under Equity. Run it again as of one year ago. Is the number growing? In Xero: Accounting → Reports→ “Balance Sheet” with the same comparison.
2
Track margin expansion on the P&L
Run a 12-month Profit and Loss with monthly columns. Calculate net margin (Net Income / Revenue) for each month. Is the trend going up? If revenue grew 25% and net margin expanded from 8% to 12%, you are building leverage. If net margin is flat or shrinking, you are not.
3
Assess owner independence honestly
No report tells you this. Ask: if I took 4 weeks off, would revenue continue? Would clients be served? Would new sales happen? If the honest answer is no, the business has limited transferable value regardless of what the financials show.

Total time: about 20 minutes for the financial checks. The owner independence assessment is qualitative and requires honesty more than time.

Why this is a quarterly conversation, not a monthly report

Retained earnings move slowly. You need 6-12 months of data to see meaningful change. Checking monthly adds noise.
Building owner independence takes time.Hiring, training, and building systems is a multi-quarter effort. The right cadence for this question is quarterly or semi-annually.

Or track your equity-building progress automatically

Bottomline connects to your accounting software and tracks the signals that separate equity-building from salary-earning:

Equity-building scorecard

Retained earnings growth (12mo)+$24,600

Net margin trend8% → 11.4% (expanding)

Repeat customer revenue62% of total

Revenue per employee trend+12% YoY

All four equity signals are positive. This business is accumulating value, not just generating a salary.

From a real Bottomline report. Equity-building tracked automatically with specific signals that show progress.

Bottomline also connects to your CRM to measure repeat customer rates and revenue per employee, two signals that neither your P&L nor Balance Sheet can show on their own. These are the leading indicators of whether your business is becoming more valuable or just staying busy.