MSP Valuations

by a searcher from Ivey Business School at Western University

3 months ago

We're evaluating an acquisition of a prospective MSP provider.  Does anyone have any insights on valuations by size, margin and growth rates of recent MSPs that have transacted?

1 like
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12 comments

searcher from University of Pennsylvania - The Wharton School

Largely depends on scale and the level / attractiveness of solutions they provide. At my prior firm, we actively looked at this and found that somewhat scaled businesses tied to attractive end-markets would trade in the high-teens EBITDA multiple range. Less familiar with very low end of the market in terms of scale.

1 week ago | like reply | 0 likes

searcher

We just purchased one, less than $500k EBITDA, unique structure where one of the partners rolled equity and the other was bought out, plus vendor financed. Essentially bought it at a 4x since we got 0% financing over 5 years and only needed to put 5% down.

3 months ago | like reply | 0 likes

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