What Is My MSP Worth? A Valuation Guide for MSP Owners in 2026

Most MSPs in the United States sell for 4–6x adjusted EBITDA. But that number is almost useless on its own. In 2026, I'm tracking a 55% gap between what commodity MSPs fetch and what converged MSP/MSSP platforms command — some closing north of 12x. The difference comes down to five or six factors that buyers actually price, and most MSP owners don't know which ones move the needle.

By Gui Carlos, CFA — Principal at Walden Mergers & Acquisitions

Last updated: February 2026

What EBITDA multiple should I expect for my MSP?

It depends entirely on your size, service mix, and how much of your revenue recurs monthly. Here's what the data shows across 466 MSP/MSSP deals that closed in 2025, totaling $4.3 billion in aggregate value:

These aren't hypothetical. They cross-reference multiple industry sources and publicly reported transactions, which show a clear upward skew in multiples for security-forward operators. The median multiple for premium platforms hit 11.4x in 2025 — up from roughly 9x two years prior.

One thing I keep telling MSP owners: your multiple isn't a fixed number. It's the output of a formula that buyers run in their heads the moment they open your financials. Change the inputs, the multiple changes with you.

Why are some MSPs worth 3x more than others?

The biggest valuation driver isn't revenue. It's revenue quality. An MSP doing $5M with 80% monthly recurring revenue from managed service agreements will always out-price an MSP doing $8M with 40% project work and a handful of break-fix clients.

Here's what I consistently see moving multiples up or down:

Recurring revenue above 70% of total revenue adds 1–2x to your base multiple. Buyers want predictability, especially PE groups running platform strategies. If your PSA shows 70%+ coming from recurring managed service contracts, you're in a different conversation entirely.

Customer concentration kills deals. When your top three clients represent more than 25% of revenue, expect a 10–30% haircut. I've watched deals collapse in diligence over this exact issue. A buyer discovers one whale client, models the risk of losing them, and the math stops working.

EBITDA margins above 20% signal operational discipline. Below 15%, buyers start questioning whether your pricing model actually works or whether you're buying revenue at the expense of margin. Service gross margins of 50%+ are the benchmark PE firms use when screening targets.

Average contract terms above 36 months push valuations 10–20% higher than month-to-month shops. Sticky clients reduce buyer risk. Lower risk, higher price. Simple as that.

The 55% valuation bifurcation between commodity MSPs and premium platforms isn't random. It maps almost perfectly to these four factors.

Does cybersecurity really command a premium?

Yes, and the gap is widening fast. Cybersecurity isn't a nice-to-have line item on your service menu. It's the primary trigger for acquisition interest in 2026.

Here's what changed: compliance mandates like CMMC 2.0, updated HIPAA requirements, state-level data privacy laws, and the EU's NIS2 directive have made SMBs desperate for managed security and compliance services. But only 36% of MSPs currently offer formal compliance services. That scarcity drives premium pricing in M&A.

The market data supports this: based on publicly reported deal activity and industry surveys, MSPs with SOC capabilities and compliance-readiness offerings are consistently closing at the upper end of the multiple range, while pure break-fix and basic RMM shops stay anchored in the 4–6x bucket. The shift isn't about adding a line item to your services page. It's about changing what buyers see when they look at your business — from a support desk to a risk-mitigation platform.

The $106 billion U.S. MSP/MSSP market is splitting between security-first operators and everyone else. PE firms like Alpine Investors (behind Evergreen Services Group, with 50+ MSP businesses), Thoma Bravo (behind ConnectWise), and Insight Partners (behind Kaseya, now at $1.5B+ ARR under new CEO Rania Succar) are all building platforms that treat cybersecurity as the foundation.

If you're still running a pure RMM/PSA shop on ConnectWise Automate or Datto RMM without a security layer, you're competing for the shrinking pool of 4–6x buyers. Adding a 24/7 SOC, even through a white-label partner to start, repositions your business in buyers' eyes almost immediately.

Who's actually buying MSPs right now?

Three buyer categories dominate the market, and each prices deals differently.

The PE platform play dominates MSP M&A right now. The 20 MSP Group (a Plano, Texas-based consolidator led by founder Tim Conkle) has completed 44 acquisitions in three years, primarily buying MSPs from within its own membership network. Evergreen Services Group (Alpine Investors) runs a decentralized model across 50+ businesses in North America and the UK. Ntiva, backed by PSP Partners, keeps stacking tuck-ins across the eastern U.S. Thrive is building a security-first platform on ServiceNow. These groups have a playbook: buy, integrate NOC/SOC, standardize the PSA/RMM stack, cross-sell security and compliance, hold for five to seven years.

What I tell every MSP owner I work with: the buyer type you attract determines your multiple. If you only appeal to a local strategic buyer looking for a client list, you're in the 5–7x range. If you can draw PE interest, the range opens wide. PE groups are sitting on $400B+ in dry powder earmarked for technology services. They aren't slowing down.

What's the biggest valuation mistake MSP owners make?

They wait too long to clean up their financials.

I can't count how many MSP owners walk into a conversation expecting 8x because they read an industry report, only to realize their adjusted EBITDA is half what they assumed. Owner compensation normalization, one-time expenses buried in G&A, that cousin on payroll who handles "special projects" — it all comes out in diligence.

The fix isn't complicated, but it takes 12–18 months to do right:

Get an honest adjusted EBITDA number. Add back owner comp above market rate, one-time legal costs, personal expenses running through the P&L. But don't add back costs a buyer will need to replace, like that underpaid senior engineer doing $130K worth of work for $70K. Buyers see through that immediately.

Separate recurring revenue from everything else. Whether you're on ConnectWise Manage, Autotask, or HaloPSA, your PSA should produce a clean monthly recurring revenue figure.

Fix customer concentration now. Every quarter you let one client sit above 20% of revenue is a quarter you're discounting your own exit.

Document your operations. PE buyers pay platform multiples for businesses that can run without the founder in the room. If your NOC depends on two senior techs who have never written a runbook, that's a haircut waiting to happen.

Consider a sell-side Quality of Earnings report. For MSPs with $2M+ EBITDA, commissioning a QoE before going to market is one of the highest-ROI moves you can make. A sell-side QoE gives you a chance to identify and fix issues — revenue classification problems, add-back weaknesses, working capital surprises — before a buyer's accounting firm finds them. It also speeds up due diligence significantly: when the buyer's QoE team sees a credible sell-side report on day one, the back-and-forth shrinks, the timeline compresses, and your deal is less likely to get re-traded on price. I've seen it add real dollars to the final number, not because it inflates anything, but because it removes the uncertainty discount that buyers bake in when financials haven't been independently verified.

Key takeaways

• Most U.S. MSPs sell for 4–6x EBITDA, but converged MSP/MSSP platforms with SOC capabilities and strong recurring revenue regularly close at 8–12x or higher
• The 55% valuation gap between commodity and premium MSPs tracks to four factors: recurring revenue percentage, customer concentration, EBITDA margins, and contract length
• Cybersecurity and compliance services are the primary acquisition trigger in 2026 — MSPs without a security layer are being left behind in the 4–6x bucket
• PE-backed platforms account for 40%+ of MSP deals and pay the highest multiples — structuring your business to attract PE interest is the single highest-ROI move before an exit
• Start the financial cleanup (including a sell-side QoE for larger MSPs), process documentation, and concentration reduction 12–18 months before you want to sell, not 12 weeks

If you want a confidential read on where your MSP sits in these ranges, I'm happy to talk. No pitch, no deck — just a straight answer from someone who stares at these numbers every week. You can reach me through guicarlos.com or connect on LinkedIn.

Gui Carlos, CFA, is a Principal at Walden Mergers & Acquisitions, a trusted Atlanta-based M&A firm since 1991. He focuses exclusively on MSP and MSSP transactions.

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