Many MSP owners carry a rough figure for what their business is worth. It usually comes from a multiple someone mentioned at a channel event, or from what a peer sold for. That figure can be a long way from what a buyer would pay, and the gap is often large enough to change an owner’s plans.
This guide explains how UK MSPs are valued, what multiples they typically sell for, which factors move the multiple up or down, and how much difference pricing and profitability make. It is useful whether you plan to sell in two years, in ten, or never.
If you want a figure for your own business first, the MSP valuation calculator takes about two minutes and needs only your revenue, EBITDA and recurring revenue mix.
How MSPs are valued
UK MSP acquisitions are usually priced as a multiple of adjusted EBITDA (earnings before interest, tax, depreciation and amortisation).
Valuation = adjusted EBITDA × multiple
Adjusted EBITDA is your profit after a buyer has made some corrections. The most common is replacing whatever the owner pays themselves with a market-rate salary for the role they perform. Buyers also remove one-off costs or income, and personal expenses run through the business. If you pay yourself a small salary and take the rest as dividends, your adjusted EBITDA will be lower than your accounts suggest.
The multiple reflects how confident the buyer is that those earnings will continue and grow. Two MSPs with the same EBITDA can receive very different offers, because one has predictable, contracted revenue and the other depends on a few clients and its owner.
Revenue multiples appear in some smaller deals, usually where the buyer is mainly acquiring a contract base. They tend to produce a lower figure than a well-run MSP would achieve on an EBITDA basis.
What multiples UK MSPs sell for
Published M&A market data, including Aventis Advisors’ analysis of MSP transactions, suggests that UK MSP transactions have generally landed between 3.5x and 7x adjusted EBITDA in recent years. Where a business sits in that range depends mainly on its size and the quality of its earnings.
Size has a clear effect. Aventis Advisors’ analysis of MSP transactions, which covers international deals and was updated in 2026, puts the smallest businesses, with revenue under $1–2 million, at around 3–4x EBITDA, and smaller companies generally at 5–8x. The median across the 120 transactions it analysed was around 8.9x, but the median deal in that sample was worth $38.5 million, far larger than a typical owner-led UK MSP. Larger MSPs attract more buyers, including private equity, and are seen as lower risk.
For a typical owner-led UK MSP with £1–5 million of revenue, a realistic starting range is around 3.5x to 6x. Quality factors can move a business by up to about 1.5x in either direction within that range.
What moves your multiple up or down
Buyers look for evidence that revenue will continue after the sale and that the business can run without its founder. These are the factors they examine most closely.
| Factor | Raises the multiple | Lowers the multiple |
|---|---|---|
| Recurring revenue | A high share of revenue from contracted monthly services | Recurring revenue below around 60%, with a large share from projects and hardware |
| Contracts | Multi-year agreements with auto-renewal and 90-day or longer notice periods | Month-to-month terms, or services delivered without signed contracts |
| Client concentration | Revenue spread across many clients | One client providing more than around 20% of revenue |
| Retention | Low churn, with clients who have stayed for years | Regular client losses that have to be replaced to stand still |
| Growth | Steady year-on-year growth | Flat or falling revenue |
| Owner dependence | A management team that runs sales, service and key relationships | An owner who is involved in every sale and every major client |
| Security capability | A defined cybersecurity practice with recurring security services | Security handled ad hoc, or not offered |
| Specialisation | Recognised depth in one or two sectors | A generalist offer competing mainly on price |
Many of these factors come back to how well the business serves its clients. Clients who get clear results stay longer, sign longer contracts and accept price increases, which is exactly what a buyer is paying for.
Worked example: the effect of margin and multiple
Take an MSP with £4 million of revenue, of which £3 million is managed services. After adjustments, its EBITDA margin is 12%, so adjusted EBITDA is £480,000. With patchy contracts and one large client, a buyer might offer 4x, valuing the business at around £1.9 million.
Lever 1: pricing. An 8% increase on the £3 million of managed services adds £240,000 of revenue. The cost of delivering those services does not change, so adjusted EBITDA rises to £720,000. At the same 4x multiple, the business is now worth around £2.9 million, an increase of about £960,000 from the price change alone.
Lever 2: quality. If the owner also moves clients onto longer contracts, reduces dependence on the largest client and hands day-to-day management to a team, the multiple could move towards 5x or more. Every half-point of multiple on £720,000 of EBITDA is worth £360,000.
These figures are illustrative, and the right numbers depend on your business. The principle holds for many MSPs: pricing is usually the fastest way to raise EBITDA, and the quality factors decide how much each pound of EBITDA is worth. The MSP price increase case study shows an 8% increase in practice: the client kept every customer and grew profit by 43%.
Why your MSP may be worth less than you think
- Your EBITDA gets adjusted down. Paying yourself below market rate flatters your profit. A buyer will correct it.
- Revenue you count as recurring is not contracted. Buyers discount services delivered without signed, current agreements.
- The business depends on you. If clients call you directly and sales run through you, the buyer is taking a risk that you will not be there, and prices that in, often through an earn-out.
- Prices have not moved in years. Low prices hold down margins, and buyers can see the gap between your pricing and the market’s.
All of these can be fixed, but they take time. Tightening contracts and client concentration can show results within a year. Building a security practice or changing your revenue mix usually takes longer. Planning 12 to 24 months ahead gives you more options.
How to increase what your MSP is worth
- Work out your adjusted EBITDA with a market-rate salary for yourself, so you start from the figure a buyer would use.
- Review your pricing. If you have not raised prices in two years or more, start here. The guide to communicating a price increase includes letter templates.
- Put every client on a current contract with a sensible term and notice period.
- Reduce concentration by growing other accounts, and review which clients are worth keeping. A client scorecard helps.
- Step back from day-to-day delivery so the business runs without you.
The six fixes that improve MSP profitability and valuation cover these areas in more detail.
Next step
Use the MSP valuation calculator to get an indicative figure for your business and see which factors are holding the multiple down.
If you want to see where your pricing stands, the MSP Pricing Scorecard takes three minutes and gives you a score and a full report by email.
Valuation multiples in this article are indicative, based on published M&A market data, and are not financial advice. Individual valuations depend on the specific circumstances of each business.
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