IT Services / MSP Valuation Multiples (2026)
Managed IT service providers are one of the hottest SMB asset classes. PE roll-ups will pay 5.0–6.5× EBITDA when MRR is 70%+ and contracts auto-renew, while project-heavy IT shops rarely clear 4× EBITDA.
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Pick your industry and enter revenue + EBITDA / SDE. We'll triangulate three valuation methods and show what buyers typically pay for businesses like yours.
Premium drivers
- ↑Recurring MRR > 70% of revenue
- ↑Per-seat contracts with auto-renewal
- ↑Vertical specialization (healthcare, legal, financial)
- ↑Documented SOC 2 or HIPAA compliance
Discount drivers
- ↓Time-and-materials revenue mix
- ↓Client churn > 10% annually
- ↓Aging hardware-resale dependence
- ↓Single-engineer SPOFs (single points of failure)
Who buys it services / msp?
PE-backed MSP roll-up (Evergreen, Rubicon, etc.), regional MSP expanding territory, or a strategic individual operator
Typical timeline + revenue band
- Days to close: 90–180
- Revenue band these multiples apply to: $1.00M–$5.00M
- NAICS: 541512 (Professional Services)
5 levers that lift your IT Services / MSP multiple by 30-50%
- 1Lock in recurring revenueConvert the top of your it services / msp revenue stack into multi-year contracts, retainers, or auto-renewing subscriptions. Buyers pay 25-40% more for revenue they don't have to re-win every quarter.
- 2De-risk customer concentrationAim for no single customer above 15% of revenue. If you have a > 25% client, get them on a multi-year master services agreement before going to market.
- 3Document the business out of the ownerPE-backed MSP roll-up (Evergreen, Rubicon, etc.), regional MSP expanding territory, or a strategic individual operator will discount aggressively for any function that lives in the owner's head — sales, key vendor relationships, pricing, hiring. Run the next 90 days like the owner is on a 6-week vacation.
- 4Clean up the financialsGet a Quality of Earnings-ready trailing 12 months: GAAP-aligned, owner add-backs documented, no commingled personal expenses. This alone moves the multiple 0.5-1.0× upward in this category.
- 5Match the deal to the right buyer poolPE-backed roll-ups, strategic acquirers, and ETA buyers compete on different terms. List with someone who has run a process for it services / msp acquisitions — generic SMB brokers will leave 20%+ on the table.
FAQ — IT Services / MSP valuations
What's a typical it services / msp valuation multiple?▾
Typical it services / msp valuations land near 3.2× SDE, 5× EBITDA, or 1.3× revenue. Strong operators reach 4× SDE / 6.5× EBITDA / 1.7× revenue, while weaker operators stay closer to 2.5× SDE / 4× EBITDA / 1× revenue.
How long does it take to sell a it services / msp?▾
Most it services / msp deals close in 90–180 days from listing. Strong operators with clean financials and a documented buyer pool close on the lower end.
Who buys a it services / msp business?▾
PE-backed MSP roll-up (Evergreen, Rubicon, etc.), regional MSP expanding territory, or a strategic individual operator
What pushes a it services / msp valuation to the high end?▾
Recurring MRR > 70% of revenue. Per-seat contracts with auto-renewal. Vertical specialization (healthcare, legal, financial). Documented SOC 2 or HIPAA compliance.
What forces a discount when selling a it services / msp?▾
Time-and-materials revenue mix. Client churn > 10% annually. Aging hardware-resale dependence. Single-engineer SPOFs (single points of failure).