How much is a company making? 7 ways to estimate revenue
You can often get a surprisingly good estimate of a company's revenue without internal numbers. This guide walks through seven practical methods - from public filings to pricing times volume - and when each one works.
MakeSense··3 min read
Why estimate revenue at all
Knowing roughly what a company earns drives real decisions: whether to acquire it, partner with it, compete with it, or invest in it. Private companies do not publish revenue, and even public ones only report in quarterly chunks - so the numbers in between are estimates.
No estimate is exact. The goal is a defensible range wide enough to be honest and narrow enough to be useful.
1. Public financial statements
If the company files with a securities regulator, revenue is published directly. For listed companies, check the annual report and quarterly filings - revenue is a headline line item you can read off without any estimation.
For private companies, some jurisdictions require simplified filings (such as company registers or director reports) that mention turnover. It is worth a search before assuming the figure is hidden.
2. Price × estimated customers
For a product business the calculation is straightforward:
Revenue = average price × estimated units sold
- Estimate the average selling price (median price, adjusted for discounting).
- Estimate how many units they move - from reviews, production capacity, distribution footprint, or market share reports.
- Multiply, then sanity-check the direction against any public hints.
For subscription businesses, the version is revenue = paying customers × average revenue per user (ARPU). Headcount on LinkedIn, support volume, or job listings can hint at customer count.
3. Headcount and revenue-per-employee
Existing public companies publish revenue per employee, and the ratio is fairly stable within an industry:
- Software companies often run Rs. 100-300 lakh per employee per year.
- Agencies and services typically run lower, near Rs. 40-80 lakh.
- Marketplaces and capital-light models can run far higher.
Count employees from LinkedIn or the team page, multiply by the industry ratio, and you have a rough but credible band.
4. Traffic × conversion × average order value
For consumer and e-commerce businesses, estimate visits with a traffic tool, then chain the funnel:
Revenue = monthly visits × conversion rate × average order value × 12
Typical online conversion rates sit between 1% and 3% for retail. This method is weakest for offline, enterprise or marketplace businesses - use it where visits roughly equal purchasers at different stages.
5. SaaS ARR from public signals
Subscription products leak signals. Job ads for support staff, review counts on product marketplaces, published customer logos, and funding rounds combined with typical growth trajectories all hint at scale.
Multiply your best guess of paying customers by the average revenue per account for their product tier. Public benchmark data for tools like this makes the ARPU guess much more defensible.
6. Industry benchmarks and rules of thumb
Funding data gives one of the sharpest tools: implied valuation ÷ a typical revenue multiple. A company that raised at a Rs. 30 crore valuation and trades in an industry doing 5-8× revenue is therefore in the Rs. 4-6 crore range.
Pair that with published averages for their industry - margins, revenue per employee, conversion rates - and cross-check the two independent estimates land in the same band.
7. Triangulate and range
Never trust a single method. Run at least two independent ones and keep the output as a range. When price × volume says Rs. 5 crore and revenue-per-employee says Rs. 4-7 crore, you have a credible band - when they disagree by an order of magnitude, one of your inputs is wrong.
Write down assumptions explicitly. A range you can defend beats a precise-looking guess you cannot.
Turn the estimate into a projection
Once you have a revenue figure, model where it goes. Our free revenue projection calculator compounds it forward from a monthly growth rate; the profitability calculator shows how much of it becomes profit after costs.
Frequently asked questions
How can I estimate a private company's revenue?
Triangulate: check any public filings, multiply estimated units or customers by average price, compare headcount against industry revenue-per-employee, and for funded companies divide implied valuation by a typical revenue multiple. Always keep the answer a range.
What is the rule-of-thumb revenue per employee?
It varies by industry. Capital-light software often runs Rs. 100-300 lakh per employee per year, services and agencies lower at Rs. 40-80 lakh, and marketplaces higher. Use a ratio from your company's own industry.
Can traffic alone tell me revenue?
No. Visits must be multiplied by conversion rate and average order value. For retail online businesses the chain is reasonably reliable; for enterprise or marketplace models it understates or misleads.
How do funding rounds help estimate revenue?
A disclosed valuation combined with the industry's typical revenue multiple back-solves to rough revenue. For example, a Rs. 30 crore valuation divided by a 5-8× multiple suggests Rs. 4-6 crore of revenue.