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How do MSPs increase their valuation multiple with security?

By , CRO, CybaVerse. Last reviewed

MSPs raise their valuation multiple with security by increasing recurring revenue, lengthening contracts, cutting churn and building a documented MDR practice. Solganick's September 2026 report says an integrated MDR practice with SOC 2 Type II and ISO 27001 adds about 1.5 to 2.5 turns to the EBITDA multiple.

This page is part of our MSP growth guide.

What drives an MSP's valuation multiple?

Buyers value predictable, sticky revenue. Solganick's September 2026 report says monthly recurring revenue above 90% of total revenue is the strongest single valuation driver in current deal flow. It also finds that contracts of 24 months or longer add roughly one turn, while annual churn above 10% removes one to three turns.

DriverReported effect
MRR above 90% of revenueStrongest single driver
Contracts 24 months or longerAbout +1 turn
Annual churn above 10%Minus 1 to 3 turns
Integrated MDR, SOC 2 Type II and ISO 27001About +1.5 to 2.5 turns

Figures from Solganick (September 2026), largely based on US deal flow.

How much more are security-led MSPs worth?

Public deal guides suggest security-led MSPs trade at a premium. CT Acquisitions reports US generalist MSPs with $3 million to $10 million revenue at around 5 to 8 times adjusted EBITDA, against 8 to 11 times for security-led firms. These are US figures; UK multiples can differ, so take advice.

How do you build security value, step by step?

Valuation gains come from evidence buyers can check, not claims. The steps below help MSPs turn security services into measurable value over two or three years. Keep clean records of contracts, revenue mix and churn, because due diligence will test every one of them in detail.

  1. Step 1: Make security recurring

    Sell MDR as a monthly subscription, not a project.

  2. Step 2: Lengthen contracts

    Offer terms of 24 months or more with security included.

  3. Step 3: Reduce churn

    Use regular security reviews to show value.

  4. Step 4: Document your practice

    Write playbooks, escalation processes and partner agreements.

  5. Step 5: Pursue relevant certification

    Consider ISO 27001 and Cyber Essentials Plus for your own business.

Where does CybaOps fit in building MSP value?

CybaOps gives MSPs a documented, recurring MDR practice without building a SOC. The CybaVerse SOC monitors client environments around the clock, and incidents are worked as cases, which gives MSPs the kind of operational record buyers often ask about during due diligence.

  • CybaVerse offers three MDR packages, CybaCore, CybaEdge and CybaOne, sold through MSPs and resellers.
  • Our UK-based security operations centre monitors customer environments 24 hours a day, 7 days a week.
  • Incidents are worked as cases in CybaOps, so every alert, action and note sits in one record your team can see.
  • CybaVerse is ISO 27001 certified.
  • CybaVerse holds Cyber Essentials and Cyber Essentials Plus itself.
  • CybaVerse is certified under the NCSC Cyber Incident Response (CIR) scheme at Standard Level.

Valuation

How security lifts an MSP's valuation

MSPs raise their valuation multiple with security by increasing recurring revenue, lengthening contracts, cutting churn and building a documented MDR practice.

01 You choose

Multi-tenantPartner / MSP CustomerCustomerCustomer+
CybaOps by CybaVerse

Valuation

02 The 5-step path

  • Role-based access
  • UK-based analysts
  • ISO 27001

03 Outcomes

Explore

Hover or tap any part of the diagram to see what it does.

  • Packages
  • CybaCore
  • CybaEdge
  • CybaOne
  • CybaVM
  • Cyber Essentials & CE+

What else do MSPs ask about valuation?

Does reselling security count?

Buyers value recurring, managed services more than one-off resale. Security delivered as a monthly managed service with clear contracts and a track record of retention tends to carry more weight than reselling licences with little ongoing service attached.

Do I need SOC 2 in the UK?

Not always. ISO 27001 is more common in the UK; ask your adviser what buyers expect. Whichever standard you choose, documented security processes and evidence of how you protect client data help show maturity to potential buyers.

When should I start?

Starting two to three years before a sale gives time to show a track record. That period lets you build recurring security revenue, improve retention and gather evidence of growth, which buyers can review during due diligence.

What should you do next?

  1. Pick five clients and write down the security gaps you already know about.
  2. Decide which service tier you could offer them this quarter.
  3. Talk to CybaVerse about delivering MDR to your clients.

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Related: How can an MSP launch an MDR service line without building a SOC? and How should MSPs price managed security and protect margin?

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