Dog Daycare & Pet Care
Valuation Multiples

How Pet Care Businesses Are Valued: SDE vs. Adjusted EBITDA

Before any multiple means anything, you need to know which earnings figure it is being applied to. In pet care this matters as much as in any sector we cover, because the market straddles two conventions depending on how large and how owner-dependent the business is, and the figures you find online rarely specify which one they mean.

A single facility where the owner works the floor, manages staff, and handles the difficult client calls is typically quoted on seller's discretionary earnings. SDE adds the owner's full compensation back to profit, on the logic that a buyer stepping into the owner's role captures that value directly. Multi-location operators are generally valued on adjusted EBITDA, which adds back only the portion of owner compensation above a market rate for the general manager role, because a buyer of three or four facilities still has to pay someone to run each one.

The distinction is not academic. If you pay yourself $95,000 to run a single facility and a facility director's market salary in your area is $50,000, an SDE presentation adds back the full $95,000 while an EBITDA presentation adds back only $50,000. Both are honest presentations of the same business, and both produce different earnings figures. Apply a 3x multiple to each and the gap is worth well over $100,000 in headline value, purely from a definitional choice rather than anything about the facility itself. Our guide to EBITDA and business valuation basics walks through how adjusted earnings get built and which add-backs typically survive a buyer's review.

When you read a pet care multiple online, the first question is which figure it applies to. A 3x quoted against SDE and a 3x quoted against EBITDA describe materially different prices for the same facility, and most of the sources publishing these ranges are not explicit about which basis they used.

What the Market Data Actually Says

Pet care is a sector where the demand-side and structural data are reasonably solid, and the transaction-multiple data is thin. It is worth being honest about that split rather than presenting everything we found with equal confidence.

The fragmentation picture is well documented and, unusually, cross-validated by two independent sources. IBISWorld counts more than 193,000 pet grooming and boarding businesses in the US employing roughly 323,000 people, in a market it sizes at $15.5 billion in 2025, stepping down slightly to $15.4 billion in 2026 against a longer five-year annualized growth rate near 1.5% (IBISWorld). Ankura's October 2025 industry spotlight, working independently, puts total US pet industry spending at $152 billion in 2024, with pet grooming and boarding representing roughly 10% of that revenue — which lands close to IBISWorld's figure — and reports that no single operator holds more than about 5% market share (Ankura). Two independent counts landing in the same neighborhood is reassuring in a sector where, as you will see below, not every figure holds up that well.

The valuation-multiple picture is where the data gets thinner. Peak Business Valuation, a business valuation firm publishing its own market analysis, puts the sector average for pet training, grooming, and boarding businesses at 3.56x to 4.10x EBITDA, 2.77x to 3.32x SDE, and 0.77x to 1.24x revenue (Peak Business Valuation). Those are broker-published figures, meaning they come from a firm's own marketing and advisory content rather than a transaction database, and pet boarding specifically is typically quoted lower on that same site, in a 2x to 3x SDE range, with single-location mom-and-pop operations often placed at 1.5x to 3.0x SDE.

A second, more recent data set complicates the picture rather than confirming it. PET|VET M&A, also publishing broker-sourced figures, reports the 2025 median EBITDA multiple at 4.40x, up from a five-year average of 3.18x, with the revenue multiple holding roughly stable near 1.15x (PET|VET M&A). The same source reports industry-wide margin compression over the same period. A rising median multiple alongside compressing margins looks contradictory on its face, and we think it is worth naming that directly rather than quietly picking whichever number is more flattering. Our interpretation, and we want to be explicit that it is our interpretation rather than a documented finding in either source, is that the median is likely masking a bifurcation: buyers paying up for well-run operators with clean financials and strong occupancy, while weaker assets absorb the margin pressure and probably trade below the headline number. We come back to this in the article-fit section below, because it changes how much weight a seller should put on any single published figure.

Transaction activity gives an early read on where this is headed. Capstone Partners' pet sector tracking shows 18 announced or completed transactions in the first half of 2026, against 8 in the same period of 2025 — a clear acceleration, even on a small base (Capstone Partners). On the buyer side, Mosaic Capital Partners' Best Friends Pet Care is the clearest example of an active roll-up: starting from 30 US locations, the platform closed 42 pet hotel acquisitions in 18 months to reach 72 locations across 26 states, according to a Mosaic partner quoted in trade coverage — a self-reported figure we are labeling as such rather than presenting as independently audited (Mergers & Acquisitions). Separately, Propelled Brands, backed by LightBay Capital and Freeman Spogli, acquired the Camp Bow Wow franchise system in February 2024, extending its franchise portfolio past 1,300 locations. Neither of those deals discloses a multiple, so we are citing them as evidence of consolidator activity, not as pricing data.

Who This Article Is For

This article is for you if you own one or more dog daycare, boarding, grooming, or training facilities and want to understand where your business sits before you talk to an advisor. It complements Salt Creek's guide to M&A advisors for pet care, which covers the buyer landscape and process in more depth, and goes deeper on valuation specifically. Most owners we work with run founder-owned or family-owned companies with roughly $1 million to $50 million in revenue and generally at least $300,000 of adjusted EBITDA, which in pet care terms usually means somewhere between one large facility and a small regional group of locations. If you own a single modest-sized facility, most of the mechanism below still applies, but your likely buyer is an individual operator or a regional group rather than a private equity platform, and the top of the range discussed here is not your market yet. See our broader sector coverage for how pet care compares with the other consumer and business-services categories we work in. Treat what follows as a map, not an appraisal.

What the Published Multiples Actually Show

Unlike some sectors we cover, pet care does not have a clean, publicly documented ladder of multiples by facility count or revenue tier. What exists is a set of broker-published averages and a single recent median, and we think it is more honest to lay those out plainly than to force them into a segment ladder the data does not support.

Single-Location, Owner-Operated Facilities

A single facility where the owner is present daily and personally handles a meaningful share of client relationships, staffing, and problem-solving sits at the bottom of the published range, broker-published at roughly 1.5x to 3.0x SDE. The logic mirrors what you would expect in any owner-dependent small business: a buyer is not just acquiring kennels and a client list, they are acquiring a role that the current owner fills personally, and they discount for the risk and cost of replacing that role.

The most valuable thing an owner at this level can do before a sale is separate themselves from daily operations. A facility with a manager who is not the owner, documented intake, safety, and staffing processes, and a client base that trusts the brand rather than one specific person is a meaningfully different asset than one where all of that runs through a single individual, even at identical revenue. That kind of change takes time to build credibly, which is why it belongs in the planning window we cover in our guide on when to start exit planning.

Pet Boarding Specifically

Pet boarding as its own category is broker-published at roughly 2x to 3x SDE, generally at or slightly above the single-location mom-and-pop range. Boarding facilities tend to carry more fixed real estate and staffing commitment than a grooming-only or training-only operation, which cuts both ways: more fixed cost to cover at low occupancy, but a larger revenue base and more defensible market position once occupancy is established.

Sector Average Across Training, Grooming, and Boarding

Blended across pet training, grooming, and boarding businesses broadly, Peak Business Valuation's broker-published figures put the average at 3.56x to 4.10x EBITDA, 2.77x to 3.32x SDE, and 0.77x to 1.24x revenue. This is the single most commonly cited range in the sector, and it is useful precisely because it blends business types rather than because it describes any specific facility precisely. A well-run multi-service facility with training, grooming, and boarding under one roof, strong occupancy, and clean financials should expect to sit above this average rather than at its midpoint; a single-service operation with soft occupancy should expect the opposite.

The 2025 Median, and the Bifurcation Question

PET|VET M&A's broker-published 2025 data shows the median EBITDA multiple at 4.40x, meaningfully above the 3.18x five-year average, even as the same source describes industry-wide margin compression over the same window. We are not going to resolve that tension by picking the number that flatters a seller. What we can say is that a rising median during a period of margin pressure is exactly the pattern you would expect if buyers are increasingly separating strong operators from weak ones rather than pricing the sector as a single homogeneous group. If that reading holds, it means the gap between the published average and the published median is itself informative: the businesses actually transacting near 4.40x today are likely demonstrating occupancy, margin discipline, and financial cleanliness well above the sector average, not simply riding a rising tide.

None of the figures above are Salt Creek valuations. They are third-party published figures, most of them broker-published, presented here with their sources so you can weigh them yourself. We have not located a transaction database that tracks pet boarding, grooming, or training multiples by facility size or revenue tier the way GF Data tracks the broader lower middle market, which is the single biggest data gap in this sector compared with others we cover.

What Actually Moves the Number Inside Your Range

The published figures set a rough range. These operating realities decide where inside it a specific facility lands, and several of them can move value more than waiting for the published average to rise.

Occupancy is the central lever, and the mechanism is arithmetic rather than opinion. Industry benchmarks put weekday breakeven around 60% to 70% occupancy at a typical daily rate of $25 to $40 per dog, with 75% to 85% occupancy generally considered efficient operation and buyers targeting 80% or above. A new facility's ramp curve typically runs 40% to 50% occupancy in year one, 60% to 70% in year two, and 70% to 85% by year three as it approaches stabilization. Because the lease, the building, and the base staffing are largely fixed regardless of how many kennels or daycare spots are filled, revenue above the breakeven point converts to EBITDA at a high rate, and revenue below it erodes EBITDA at a similarly high rate. We are not able to point you to a source that quantifies exactly how many turns of multiple a given occupancy improvement is worth, and we would rather tell you that plainly than manufacture a number that sounds precise but is not. What is well supported is the direction and the mechanism: occupancy above breakeven is where a facility's real earning power gets demonstrated, and that earning power is what the multiple gets applied to.

Labor is a large cost, but not a regulated one the way it is in childcare. Labor typically runs 35% to 50% of revenue, with roughly 40% being typical for a medium-sized commercial facility, and rent and utilities generally add another 20% to 25%. This is a useful point of contrast with a sector like early childhood education, where teacher-to-child ratios are set by state law and staffing cannot be trimmed below a legal floor regardless of enrollment. Pet care staffing is shaped by safety practice, insurance requirements, and operational judgment about how many handlers a given number of dogs actually needs, but it is not fixed by statute the same way. That gives a pet care operator more flexibility to manage labor cost during a soft period than a childcare operator has, and it also means labor discipline is more of a management-quality signal in pet care than a pure compliance requirement. Our childcare and daycare valuation guide covers the regulated version of this cost structure if you want the contrast in full.

Real estate is usually a separate negotiation from the operating business. Pet care facilities are real-estate-intensive, and a sale-leaseback — selling the real estate and signing a new long-term lease back to the operating company — is the structure consolidators generally prefer, because it lets them deploy capital toward acquiring more facilities rather than tying it up in specialized property. Lease economics in this range typically run in the neighborhood of $18 to $35 per square foot annually on 10 to 15 year terms; we want to be direct that this figure is drawn from veterinary real estate guidance rather than pet boarding transactions specifically, because pet-specific lease documentation is thin in the sources we reviewed. If you own your building and charge your operating company below-market or no rent, expect a buyer to impute a market rate before applying any multiple, the same adjustment a buyer would make in almost any owner-occupied real estate scenario.

EBITDA margin tells you where a facility sits before a buyer even runs a multiple. Struggling single-location operators often run EBITDA margins of 5% to 10%. Healthy single-location facilities land in the 15% to 25% range. Multi-location operators with real systems — centralized scheduling, standardized staffing models, consistent reporting — reach 20% to 30%. High-end pet hotels at stabilized occupancy can reach 30% to 35%. A facility's position in that band is a strong preview of where it will sit in the multiple range, because buyers read margin as a proxy for operating discipline and pricing power, not just a snapshot of current profitability.

Customer churn is the closest thing pet care has to a retention metric a buyer can underwrite. Monthly churn below 5% is generally considered the quality benchmark. Unlike a subscription software business, no client signs a contract to keep boarding or grooming their dog with you, so a buyer looks at churn, repeat frequency, and how long the average client relationship lasts as the best available evidence that revenue is durable rather than one good year. Our guide on what buyers look for in an acquisition target covers how retention evidence gets weighed more broadly across the lower middle market.

Financial cleanliness matters more in a bifurcating market. If the read on the 2025 median above is correct — that buyers are increasingly separating strong operators from weak ones rather than pricing the sector uniformly — then the businesses able to demonstrate that quality through clean, well-documented financials are the ones most likely to see the higher end of any range. That is exactly what a quality of earnings report is built to demonstrate, and it is worth commissioning one before you go to market rather than discovering what it would have shown during a buyer's diligence.

The Veterinary Contrast: What Pre-Consolidation Looks Like

The most useful comparison in this entire article is not another pet care number. It is veterinary medicine, a directly adjacent sector that is roughly fifteen years further into the same consolidation story pet care is just beginning.

First Page Sage's Q1 2025 data shows general veterinary practices trading at EBITDA multiples ranging from about 5.3x at the smallest earnings tier up to 11.3x at $5 million to $10 million of EBITDA, with emergency clinics running a comparable 5.4x to 10.4x and specialty practices reaching the highest range at 7.1x to 13.2x (First Page Sage). Set that against pet training, grooming, and boarding's broker-published sector average of 3.56x to 4.10x EBITDA. Even at the low end of the veterinary range, general practices are trading at multiples pet care facilities rarely reach even at the high end of their own published data.

The reason is not that veterinary medicine is inherently a better business. It is that veterinary medicine has already been substantially consolidated. AAHA and Brakke Consulting report that corporate consolidators owned roughly 50% of the US veterinary market by 2021, including about 25% of general practices and a striking 75% of specialty and emergency practices (AAHA / Brakke Consulting). Consolidation brought centralized purchasing, shared back-office infrastructure, referral networks between general and specialty practices, and access to institutional capital — all of which show up in the multiple a buyer is willing to pay, because they are paying for a platform's economics, not just one clinic's earnings.

Pet boarding and grooming has not had that wave yet. IBISWorld's count of more than 193,000 US businesses, combined with Ankura's finding that no single operator holds more than about 5% market share, describes a sector that remains more than 95% fragmented — close to where veterinary medicine stood before its own consolidation wave began. The early evidence of the same dynamic starting to play out is visible in the consolidator activity we described above: Mosaic Capital's Best Friends Pet Care platform closing 42 acquisitions in 18 months to grow from 30 to 72 locations, Propelled Brands folding Camp Bow Wow into a franchise system past 1,300 locations, and Capstone Partners tracking pet sector deal volume more than doubling in the first half of 2026 versus the same period a year earlier.

We want to be precise about what this comparison does and does not tell you. It is not a prediction that pet care multiples will reach veterinary levels, and we are not aware of a credible source that models that outcome with any specificity. What the comparison does show is a plausible mechanism: the multiple gap between an adjacent, structurally similar sector before and after consolidation is the size of the prize that active consolidators are underwriting when they buy pet care platforms today. Whether that plays out in your specific timeframe is a genuinely open question, and it is one reason the timing question deserves a real conversation rather than a guess based on a single headline multiple.

One clarification worth making explicitly: Rover, the online marketplace connecting pet owners with independent sitters and walkers, was acquired by Blackstone in a transaction reported around 30x EBITDA. That multiple belongs to a software and marketplace business model with a fundamentally different margin and growth profile than a facility operator carrying real estate, payroll, and physical capacity constraints. It is not a pet care operating comparable, and we are flagging it here specifically because it is the kind of headline number that gets misapplied to facility valuations by people who have not looked closely at what actually produced it.

How Pet Care Multiples Compare Across the Lower Middle Market

Pet care sits below the middle of the lower middle market on published multiples, and the comparisons below explain why, and where the gap is likely to close first.

• Against the broader lower middle market. GF Data, the standard source for lower middle market transaction multiples, reports averages in the mid-5x to low-7x range across all industries at the sizes most owner-operated businesses occupy, with a pronounced size premium as deal value rises. Pet care's broker-published bands sit at or below that range, consistent with a business carrying real estate intensity, thin contracted revenue, and a still-developing buyer pool. Our guide to EBITDA and valuation basics covers those cross-industry brackets in more depth.
• Against recurring-revenue services. The contrast with managed IT services is instructive here too. An MSP with contracted, assignable, multi-year revenue trades at a premium precisely because the revenue survives a change of ownership on paper. Pet care client relationships are durable in practice, evidenced by churn below 5% monthly at well-run facilities, but they are not contractual anywhere, so buyers pay for demonstrated retention rather than documented obligation. See our MSP valuation multiples guide for how that premium gets priced.
• Against another regulated, real-estate-heavy consumer sector. Childcare shares more with pet care than most sectors do: both are local, real-estate-intensive, staffing-heavy businesses serving recurring but non-contractual demand. The difference is regulation. Childcare staffing ratios are set by state law and cannot flex below a legal floor; pet care staffing is shaped by practice and insurance rather than statute. Our childcare and daycare valuation guide is a useful side-by-side read if you want to see how a regulated labor floor changes the underwriting.
• Against other consolidating sectors. Pet care buying is increasingly a roll-up story, and negotiating against a serial acquirer with a model and a pipeline is a different exercise than negotiating against a one-time buyer. See why roll-ups are heating up in legal services and pet care, and our guide on strategic versus private equity buyers for who shows up at each size and what each type is likely to prioritize in diligence.

Getting a Range Specific to Your Facility

The ranges above tell you where pet care businesses generally trade, and how thin that data actually is once you look past the headline numbers. They cannot tell you where your facility would land, because that depends on details a buyer examines directly: occupancy by day of week and by season, your staffing cost as a share of revenue, your lease or your rent arrangement with yourself, customer churn and repeat frequency, and the share of the operation that runs without you in the building.

A preliminary valuation conversation is how a market range becomes an estimate that reflects your actual business. Jack and Connor handle these directly, both founders on every deal, and we work on a success-fee basis with no upfront retainer for standard M&A engagements, so an early conversation carries no cost and no obligation to sell. Our guide on how a sell-side process compares to working with a business broker covers what that direct involvement actually changes about outcomes.

If you want to understand your options in more depth, start with our guide to M&A advisors for pet care, then review how Salt Creek approaches business valuation and how a lower middle market sale process actually unfolds.