Seller's Discretionary Earnings (SDE) Measures The Total Financial Benefit Available To One Working Owner And Typically Includes The Owner's Compensation And Eligible Discretionary Expenses. EBITDA Measures Earnings Before Interest, Taxes, Depreciation, And Amortization, Generally After Accounting For A Market-rate Salary For Management. SDE Is Commonly Used For Owner-operated Businesses, While EBITDA Is Often Used For Larger Businesses With Management Teams.