Growing to Sell Your MSP Business Acquisitions are a huge factor in the MSP space. Whether it’s the vendors the MSP works with, or the MSP themselves, mergers and acquisitions seem to be on a steady rise in recent years. Multiples are healthy and the economic uneasiness in the area has led many business owners to exit. If you’re growing an MSP, selling or buying has undoubtedly been on your mind. In this segment, we’ll be discussing 4 key components to consider when growing to sell: 1. Revenue Ratio 2. Client Ratio 3. Client Upsells 4. Marketing Strategy By Jeanne DeWitt Revenue Ratio Recurring revenue will receive a higher valuation than project/hardware revenue. An MSP looking tomaximize their valuation should focus on growing their recurring revenue. Project and hardware sales are inventible and an important part of the business. However, you will not receive as high of an offer if your business is predominantly based on chasing the next project. We have partners on both ends of the Spectrum. One partner stated that their project/hardware is 10X the agreement revenue for many of their customers.
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