Selling your MSP or IT company?
Monthly recurring revenue is the whole game.

The honest version

What IT services businesses actually sell for

MSPs commonly trade in the range of 6–10x adjusted EBITDA, with high-MRR, low-churn businesses reaching the top of that range and beyond. Project-dependent IT businesses without a contracted recurring base are valued materially lower.

The range is wide because the same business is worth different amounts to different buyers. In this sector you are usually looking at three:

• PE-backed MSP platforms — the dominant buyers, underwriting recurring revenue, churn, and contract quality above almost everything else.
• Strategic MSPs — competitors acquiring for scale, geography, or a specific vertical specialization you have built.
• Individual and search-fund buyers — realistic for smaller books, usually financed and slower to close.

Which of those is at your table changes your number far more than anything on your equipment list.

What moves the number

The four things buyers actually underwrite

• Percentage of revenue that is contracted MRR. The first question every buyer asks. Contracted, auto-renewing recurring revenue is worth several times what project revenue is worth.
• Churn and contract length. Low churn with multi-year agreements is the difference between the top and the bottom of the range.
• Client concentration. A book where one client is a large share of revenue is discounted heavily, no matter how long the relationship has run.
• Stack standardization and documentation. A standardized, documented tool stack is straightforward to integrate; a bespoke environment held in one engineer's head is a diligence problem.

One thing worth knowing before you talk to a platform buyer: they will run technical and financial diligence at a level most owners have never experienced, including per-client profitability. Knowing which of your clients actually make money — before a buyer tells you — is both a negotiating advantage and a reason to fix pricing early.

The process

Why a quiet, competitive process beats the first offer

Most owners in this sector are approached directly, unsolicited, by a consolidator or a platform buyer. That approach is flattering and it is also the single most expensive letter you can accept, because a buyer negotiating against nobody has no reason to move on price or on terms.

We run the opposite process. Buyers are qualified and under confidentiality agreement before they learn whose business it is. Nothing is listed, advertised, or published. Your staff, your customers, and your competitors learn nothing until you decide they should — and several credible buyers are considering the same opportunity at the same time.

The result is not only a better number. It is better terms: what happens to your team, how long you stay, how the earn-out is structured, and what happens to any real estate.

Common questions

IT services company owners ask us these first

What is my MSP worth?

Managed service providers commonly sell for 6 to 10 times adjusted EBITDA, with the highest multiples going to businesses with a high proportion of contracted monthly recurring revenue, low churn, multi-year agreements, and no heavy client concentration. Project-heavy IT businesses sell for meaningfully less.

Who buys managed service providers?

Private-equity-backed MSP platforms are the most active buyers, alongside strategic MSPs acquiring for scale or vertical specialization, and individual or search-fund buyers for smaller companies.

How do I increase the value of my MSP before selling?

Convert project clients onto contracted recurring agreements, lengthen contract terms, reduce client concentration, standardize and document your stack, and fix pricing on unprofitable accounts. These changes take one to two years to show up in the financials, which is why starting early pays.