What’s Your RTO Worth? Understanding the Value of Training Businesses in 2025

RTO's

Registered Training Organisations (RTOs) are a staple of Australia’s education and workforce development landscape. Whether delivering certificate-level programs or accredited industry training, RTOs can be highly profitable — but when it comes time to sell, many owners are left wondering: What is my RTO actually worth?

Let’s unpack how the market currently views RTO valuations and what drives value in this heavily regulated sector.

📊 Typical Valuation Multiples for RTOs

In 2025, the majority of RTO sales in Australia occur within the following valuation ranges:

1.5x to 3.0x EBITDA — This is the core range for most compliant, operational RTOs.

3.0x to 4.0x — Reserved for larger, stable RTOs with strong funding pipelines, a broad scope of registration, and recurring enrolments.

Above 4.0x — Considered rare and usually tied to strategic acquisitions (e.g., national providers or those with exclusive IP/licensing deals).

For smaller RTOs with lower EBITDA (under ~$500K), deals often fall back to a 1.0x to 2.0x SDE (Seller’s Discretionary Earnings), especially where the owner is heavily involved.

📋 What Drives Higher RTO Valuations?

Buyers (especially private equity and consolidators) look for certain “value signals”:

Compliance strength: Clean ASQA audit history, no looming sanctions, and proactive recordkeeping.

Funding streams: Access to Smart & Skilled, Skills First, or international CRICOS registration can significantly boost value.

Delivery model: RTOs with blended or online offerings often attract better multiples due to scalability.

Scope of registration: A diverse, high-demand scope (e.g., aged care, construction, logistics, or digital skills) is a major plus.

Client base: Corporate and government contracts create predictable cashflow and make the business less reliant on walk-in enrolments.

Systemisation: The less reliant an RTO is on the founder for day-to-day operations, the better.

⚠️ Common Risks That Pull Multiples Down

Heavy owner dependence: If the business stops without you, buyers will pay less.

Funding volatility: RTOs built around one grant or short-term contract carry more risk.

Poor documentation: Incomplete student files or non-compliant assessments can be deal breakers.

Thin margins: If net profit is consistently under 10%, buyers may assume systemic cost issues.

🧮 A Quick Example

If your RTO earns $350K EBITDA, and has a clean compliance record, consistent revenue, and a diverse course mix:

Valuation range: $525K – $1.05M (1.5x to 3.0x)

Add property, if owned, as a separate asset in negotiations.

But if your RTO is built around you, with no scalable systems and limited contracts, you may land closer to $350K – $500K, especially if compliance is borderline.

🧠 Final Thoughts

RTO valuations hinge as much on risk and replicability as they do on raw earnings. If you’re preparing to exit in the next 12–24 months, now’s the time to:

Sharpen your compliance.

Lock in future contracts.

Reduce reliance on yourself.

Build systems someone else can run.

In this market, buyers aren’t just buying revenue — they’re buying certainty. If your RTO can deliver that, the offers will follow.