What Is My Private School Worth?

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What Is My Private School Worth On Today's Market?

What Is My Private School Worth On Today's Market?

A Practical Guide for School Owners

If you’re a school owner exploring a sale, planning succession, or just wondering what your school is worth, you’re asking the right question. The value of your private school depends on several key factors, including finances, enrollment, property, accreditation, program offerings, location, and reputation. There’s no one-size-fits-all formula, but a clear understanding of how schools are valued will help you prepare for the next steps. Here’s a straightforward breakdown of the methods buyers use to assess school value, and what you can do to get ready.

How Schools Are Valued

Valuation models combine the elements of financial analysis, real estate review, and market positioning to provide a comprehensive assessment. Most buyers look at a mix of these methods:

1. Asset-Based Valuation

This approach adds up the value of land, buildings, equipment, and other tangible assets, then subtracts the value of liabilities. It helps establish a baseline, but it often under-represents the school’s true value, as it doesn’t account for earnings or reputation. It may also not be an acceptable transaction structure if your accreditor requires a share sale rather than an asset sale.

2. Income-Based Valuation

This focuses on profit and cash flow. Buyers often use a multiple of EBITDA or net profit to calculate value. For well-run schools, the multiples range from 4x to 7x EBITDA depending on location, size, school type, and reputation. In some cases, a Discounted Cash Flow (DCF) model is used to estimate future earnings and reflect growth potential.

3. Market (Comparable Sales) Approach

This method compares your school to similar institutions that have recently sold. It helps establish fair market value based on real-world data. However, current and relevant comps will be key to using this approach.

4. Goodwill Valuation

Goodwill includes your school’s brand, reputation, faculty quality, and standing in the community. It is often factored in as a multiple of earnings, added to the asset value to reflect the full enterprise value.

What Buyers Look For

Valuation isn’t just about the numbers. The following factors also influence a buyer’s offer:

  • Financial Health: Clean, reliable financials with stable or growing earnings

  • Enrollment Trends: Consistent demand and strong retention

  • Location: Schools in urban or high-demand areas attract premium pricing

  • Reputation: Accreditation, regulatory history, and community reputation matter

  • Faculty and Staffing: Low turnover and strong leadership add confidence, and turn-key management 

  • Market Position: Specialized programs or unique offerings increase appeal, especially in sectors with high barriers to entry

  • Legal Risks: Active litigation or poor leases can reduce value, as can issues with an accreditor

  • Growth Potential: The Capacity to scale or expand programs is a plus, and compelling to a buyer that forecasting future operations

Real Estate Considerations

For many owners, the property is a significant part of the school’s overall value. Buyers will assess:

  • Location and zoning

  • Size and condition of buildings

  • Comparable sales in the area

  • Cost to rebuild the facility

If you own your campus, the real estate component will significantly increase your overall valuation. Further, if you have an opco and a propco, you need to factor in your FMV of the lease between the entities.

Steps to Prepare

If you’re considering a sale or want to know where you stand, here’s what you can do:

1. Normalize Financials
Clean up your books to reflect true earnings. Remove non-recurring or personal expenses.

2. Showcase Your Strengths
Highlight programs, outcomes, facilities, profitability, or any other aspect that sets your school apart.

3. Know your Buyer
Tailor your messaging depending on whether the buyer is a school group, investor, or PE firm (e.g., Strategic vs. Financial buyer)

4. Get expert guidance
A professional valuation from a specialist in education M&A can save time and uncover hidden value, providing you with a reality check on your true market value.

How HEG Can Help

At Halladay Education Group, we’ve been advising private school owners for more than 40 years. Our work spans North America and beyond, encompassing K-12 schools, boarding high schools, ESL programs, career colleges, and universities in the U.S. and Canada.

We provide accurate and confidential assessments, guiding owners through the entire sale process. Our global buyer network, deep sector expertise, and proven track record of results make us a trusted partner in the education mergers and acquisitions (M&A) space.

Let’s Talk

If you’re considering selling or would like to know your school’s current value, we’re here to help. We offer confidential valuation reviews and clear advice on how to prepare for a sale.

Contact Halladay Education Group today
📧 info@halladayeducationgroup.com
📞 1-800-687-1492 | WhatsApp: 604.868.0002 | WeChat: dhalladay