Rick Murphy of Cogent Growth Partners has worked on hundreds of mergers and acquisitions involving technology service providers. In a conversation featured on MSPInfluencer, Murphy shared what buyers actually look for when evaluating MSPs.
Many MSP owners believe valuation is driven primarily by revenue size. Murphy explains that buyers are often evaluating something deeper—how well the company operates, whether leadership is distributed, and whether the business can continue running successfully after a transition.
1. Operate the Business as if It Could Be Sold Tomorrow
Murphy explained that MSP owners should run their companies as if a transaction could happen tomorrow. This mindset encourages stronger financial discipline, clearer operational structure, and long-term planning.
Even if a sale never happens, building the business this way typically results in a stronger and more sustainable company.
2. Businesses Must Function Without the Founder
Murphy noted that buyers evaluate whether the company depends heavily on the owner.
If the founder drives every relationship and decision, the business becomes riskier for a buyer. MSPs that have leadership teams, documented processes, and distributed responsibilities are generally more attractive acquisition targets.
3. Talent Often Drives the Value
Murphy pointed out that many acquisitions in the MSP space are partially talent acquisitions.
Buyers want confidence that the team delivering services will continue supporting customers after the transaction. Strong leadership and experienced technical staff increase buyer confidence and perceived value.
4. Customer Relationships Must Transfer
Another key factor Murphy discussed is whether customer relationships can successfully transition to new ownership.
If relationships exist only with the founder, buyers may see risk. MSPs that build structured account management and service delivery models make those relationships easier to transfer.
What This Means for MSPs
Murphy’s perspective highlights that the qualities buyers value most—strong teams, transferable relationships, and operational discipline—are also the qualities that make an MSP healthier and more scalable. Owners who focus on these fundamentals position their companies for stronger long-term growth and potential acquisition opportunities.
