SDE is profits of the business as-if the owner took no salary. EBITDA is SDE minus Owner Salary. In a closely held business, owner's salary is up to owner's discretion. If there are two buyers looking at the same business, the SDE will be the same for both of them, but the EBITDA would be different (unless they both expect same salary). There are NO standards for owner salary.

By including the owner’s salary, benefits, and discretionary expenses when calculating SDE, you get a comprehensive measure of a small business’s cash flow. EBITDA is better suited for larger companies with more intricate financial structures because it concentrates more on operating performance by eliminating owner-operated expenses.