The MSP merger and acquisition market continues to attract private equity and strategic buyers, but service providers hoping to capitalize on that demand must prepare their businesses—and themselves—well before entering a transaction.
MSP valuations remain at six to eight times EBITDA
Speaking at GTIA ChannelCon 2026, Craig Fulton, M&A advisor at Evergreen, said buyer interest remains anchored in the recurring revenue and customer relationships that make MSP businesses attractive investments.
“High recurring revenue—70% to 75% of your revenue is recurring—that’s solid,” Fulton said during the Visionaries Power Panel. “The reason you’ve seen the flood of acquisitions is because [MSPs are] sitting on gold with their customer contracts.”
Fulton said average North American MSP valuations remain in the range of six to eight times EBITDA. Artificial intelligence has not yet produced a separate valuation premium, he added, although using AI to improve scalability, efficiency and profitability can strengthen the underlying financial metrics buyers assess.
MSP owners should prepare years before a sale
Many owners overestimate their company’s value because they have managed the business from a technical perspective rather than a financial one, Fulton said in a separate Channel Insider interview.
Excessive software spending, unclear accounting and below-market owner compensation can all reduce adjusted EBITDA during a buyer’s review.
“If you’re getting serious about selling within three years, start running the business as if someone else is going to buy it,” Fulton said.
That preparation can include cleaning up expenses, documenting operations, formalizing contracts and accounting for costs the buyer will inherit. For example, an owner paying themselves an artificially low salary may see EBITDA adjusted downward to reflect the cost of hiring a replacement executive.
The ChannelCon panel also emphasized that buyers increasingly examine how effectively an MSP uses AI to operate efficiently, alongside recurring revenue, documentation and company culture.
Choosing the right buyer requires more than comparing offers
MSP owners should first determine their financial goals and build a succession plan, Fulton advised. They should also consider whether they want to leave immediately, remain involved or preserve the company’s brand and operating model.
Different acquirers may pursue geographic expansion, vertical expertise, talent, customer contracts or financial efficiencies. Their approaches to integration can vary just as widely, from preserving an MSP’s local identity to folding its employees and systems into a larger organization.
Several participants on the mainstage panel also said that owners owe it to employees and customers to understand what will happen after a deal closes.
Fulton also cautioned owners to prepare emotionally. Selling a business can change an entrepreneur’s identity as much as their finances.
“It’s not a transaction. It’s more,” Fulton said. “It’s something they’re probably only going to do once. No one wants to live in regret.”
READ MORE: Catch up on all of our reporting from GTIA ChannelCon 2026.