Service businessNov 8
Recurring-Revenue Managed IT Services Provider
This 25-year-old IT support firm has kept its small-business clients for 13 years on average, and every managed client is on one contract that transfers to a buyer.
- Ask
- $1.25M
- Profit
- $344K
- Multiple
- 3.6x
- Ask
- $1.25M
- Revenue
- $894K
- Profit
- $344K
- Margin
- 39%
- Multiple
- 3.6x
- Age
- 25+ yrs
How it rates
ValuationFair
Similar online service businesses we've tracked mostly ask 2.7–4.3x profit, or 2.5–3.9x adjusted for the owner's workload; this one asks 3.6x.
Durability
Over 25 years old, with clients staying 13 years on average, but the owner leads all the technical work.
Hands-off
The owner is the technical lead, and the only help is a part-time contract engineer.
Why it's interesting
- Every managed client is on one standard agreement that auto-renews every 12 months, raises prices each year and can be assigned to a buyer without client consent. It brings in about $33.6K a month ($402.6K a year).
- Clients stay a long time. The average client has been there 13.1 years, 9 have stayed more than 20 years, only one small account was lost to a competitor in 36 months, and the largest client is 11.5% of monthly recurring revenue.
- Adjusted profit, counted with the owner still doing the work, held at $317K–$366K from 2023 to 2025, at 41–49% margins. It runs from a home office with no lease.
- Temporary per-user discounts start stepping down at the 2027 renewals, on top of yearly price increases. Procedures and runbooks are written down, and a contract engineer was onboarded from them in 2026.
What to watch
- Profit is stated on an owner-operator basis. A buyer who doesn't do the technical work would need to hire a lead engineer, which would cut profit sharply. At about 3.6 times profit, the price appears to assume an owner-operator or an existing MSP buying it.
- Contracted recurring revenue is $402.6K of $894K in sales. What makes up the other ~$490K (projects, hardware, unmanaged support) isn't described. Profit of $344.3K is also a 38.5% margin, below the 41–49% the broker cites.
- The standard-contract model is only two years old. Clients who have stayed for decades likely stayed with the owner personally, and new clients have come almost entirely from referrals, with no marketing behind them.
Ask the seller
- What makes up the ~$490K of revenue beyond the managed contracts, and how much of it repeats each year?
- How many hours a week does the owner work, and which clients deal with the owner directly?
- How long will the owner stay on after the sale, and is the contract engineer willing to stay or go full-time?
Growth plays
- Move the 95 unmanaged workstations onto the per-user managed plans that existing clients already use.
- Sell cyber-insurance readiness and compliance reviews to the legal and accounting clients, using the standard security and backup setup the firm already runs.
- Get referral and vendor-program listings with state bar associations and CPA societies to win more firms like its current legal and accounting clients.
Nov 8Added to Acumen Wire