B2B IT Managed Services Provider
This acquisition opportunity centers on a regional B2B managed services provider (MSP) serving small and medium-sized businesses (SMBs) across healthcare, legal, and financial verticals. The company offers IT infrastructure support, network security, cloud migrations, workstation management, disaster recovery solutions, and help desk support. With $3.6 million in annual revenue and $720,000 in adjusted EBITDA, the business has achieved stable margins through multi-year service contracts with over 130 active clients. Most client relationships are governed by rolling monthly contracts with 60- or 90-day notice termination clauses, and approximately 85% of revenue is derived from recurring monthly fees.
For acquirers evaluating service-based businesses with high client retention and limited physical infrastructure, this MSP offers a compelling opportunity to secure predictable cash flow with minimal CapEx. However, to structure a successful acquisition, several core components must be evaluated in depth namely, client contract transferability, technical team dependency, service delivery SLAs, and the structure of recurring revenue. A properly structured SBA 7(a) acquisition can be used to acquire the business while addressing downside risk through contract analysis and staffing continuity.
A potential deal structure could be outlined as follows:
Purchase Price: $2.7 million (3.75x EBITDA)
SBA Loan: $2,025,000 (75%)
Buyer Equity Injection: $270,000 (10%)
Seller Financing: $405,000 (15%), interest-only for 12 months, amortized over 48 months
Given the reliance on monthly recurring revenue (MRR), it is essential that the buyer reviews all existing client agreements during due diligence to ensure assignability. Many MSPs use Master Service Agreements (MSAs) or Statements of Work (SOWs) that may include non-transferability clauses or require notice for assignment. Where such clauses exist, the buyer should plan a coordinated contract novation process. Ideally, the seller would facilitate this process through warm introductions and client reassurances, and may even remain involved during the first 90–120 days under a consulting agreement.
To protect against contract attrition risk, the seller financing should include a clause reducing the balance if more than 15% of MRR is lost within 90 days of closing due to voluntary client terminations. A provision of this nature ensures seller alignment and gives the buyer downside protection during the most vulnerable transition period.
On the staffing side, the company employs 18 full-time staff, including 12 technical employees (systems administrators, Tier 1 and Tier 2 support), three account managers, two project engineers, and one CTO-level manager. The technical team holds various certifications in Microsoft, Cisco, AWS, and CompTIA technologies, and delivers 24/7 support for critical accounts.
Staff turnover in IT can be a significant risk factor post-acquisition. The buyer should secure signed employment agreements with all technical employees prior to close, offering stay bonuses of $3,000–$5,000 for 6-month retention. Additionally, a plan to promote an internal team lead to oversee client escalations may help transition away from owner-driven support oversight.
The seller currently spends about 25–30 hours per week in the business, primarily on client relationships, renewals, and managing the project pipeline. A buyer must evaluate whether those functions can be absorbed by existing staff or whether a client success manager role should be hired to avoid a revenue dip. Many MSPs are relationship-driven businesses if the seller is the main contact for top clients, that introduces churn risk. To mitigate this, the buyer can schedule joint account management meetings pre-close to allow for relationship handoff and set clear expectations.
Recurring revenue breakdown includes:
Help Desk & Workstation Support (Tier 1 & 2): 42%
Infrastructure Monitoring & Security (e.g., firewalls, antivirus, patching): 25%
Cloud Backup & Disaster Recovery: 13%
Project-Based Revenue (one-time migrations, equipment installs): 15%
Hardware Resale Margin: 5%
A buyer should evaluate the contribution margin by revenue type to understand how much overhead is covered by core MRR versus project-based revenue. Ideally, the business should have at least 65–70% of gross margin from MRR to be eligible for SBA underwriting without excessive risk adjustments. Any reliance on project spikes or hardware sales needs to be discounted in normalized EBITDA.
The company currently operates out of a 2,100 square foot leased office in a Class B office park, paying $3,800/month. The space includes a network operations center (NOC), meeting rooms, and storage for spare parts and routers. The lease is assignable with 18 months remaining. The buyer should consider a short renewal or sublease option, especially if a remote-first model is pursued post-close. The business transitioned to partial remote operations during COVID and continues to operate a hybrid model, which is attractive from a cost-structure standpoint.
Sales and marketing efforts are modest. The company has relied heavily on client referrals, long-term relationships, and a few regional partnerships with copier dealers and telecom brokers.
The buyer can improve growth trajectory through:
Dedicated SDR/BDR Hiring: An inside sales rep working from a targeted list of local firms (law offices, medical practices, real estate agencies) with up to 20 users
Website Conversion Optimization: Adding scheduling widgets, case studies, and gated white papers to increase inbound leads
Co-Managed IT Offering: Partnering with internal IT departments at mid-sized firms that need overflow support but want to retain partial control
Cybersecurity-as-a-Service: Bundling compliance reporting, penetration testing, and endpoint protection into a new monthly plan tier
The business’s financial systems are clean, using QuickBooks Online for accounting, ConnectWise for ticketing and service desk workflows, and IT Glue for documentation management. Financials are reviewed quarterly by a CPA, and monthly KPIs include ticket resolution time, response SLA adherence, uptime percentages, and customer satisfaction surveys.
During diligence, the buyer should:
Scrub the entire client list for contract terms, AR aging, and potential churn risk
Verify ownership and licenses of all proprietary scripts, automation tools, and vendor partnerships
Assess the security posture of the company’s own systems and determine what cybersecurity liabilities or breach history exist
No open lawsuits or regulatory issues have been reported, and insurance includes cyber liability ($1M), general liability, and E&O coverage an important requirement for clients in financial services and healthcare.
From a strategic standpoint, the business is ripe for a roll-up into a larger IT or B2B services portfolio. Platform buyers may use it to expand geographically or vertically. Smaller independent buyers can use this as a foundational business with modest headcount and scalable systems already in place.
Ideal buyers include:
IT professionals seeking to transition from W-2 roles into business ownership
Regional MSPs or VARs (value-added resellers) seeking market share
Financial buyers with access to licensed IT managers or operators
The key to acquiring this business is recognizing the value of recurring service revenue, securing continuity of client relationships, and maintaining the skilled technical workforce without disruption. If structured properly with protections around contract retention and staffing, this MSP represents a highly financeable and operationally scalable acquisition candidate.
