Insights

  1. How External Market Factors Drive Your Company’s Valuation

    By: Wesley Legg “I should have sold when I had the chance,” is a phrase our advisors hear much more often than “I sold too early.”Timing a transaction is tricky, because it’s influenced by a variety of internal and external factors, such as:– Government policy– Capital markets– Macro-economic forces– Industry life-cycles– The company’s life-cycle– Personal…

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  2. Valuation Drivers in Managed IT Services

    Founders Managed IT Services Valuation Scorecard Founders’ MSP Valuation Scorecard isolates the most critical quantitative and qualitative factors during valuation multiples Revenue Stream Impact on Valuation For Managed IT Services Revenue composition remains a critical driver of valuation for managed IT service providers; below displays how the investor community views varying streams of revenue in…

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  3. Market Share: When Comparison Is a Good Thing

    By: Brad Johnson “How large is your market, and what is your share of it?” If you haven’t been asked this question yet, you can certainly expect it if you ever consider any sort of transaction. This is one of the most common questions from both strategic and financial buyers, yet we typically find that…

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  4. Gross Margin Trends

    By: Wesley Legg As healthy companies grow, they generally see margins expand as fixed costs are diluted with increased sales or as the company gains pricing power. Therefore, compressing margins can be a leading indicator of issues arising within a business. Perhaps a business has not invested sufficiently in R&D, so their technology is becoming obsolete….

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  5. Growth or Profitability – Which Should I Choose?

    By: Chris Weingartner One of the most frequent questions we are asked by founders and entrepreneurs is whether their focus should be on growing revenues or achieving profitability, especially when it comes to the impact on Enterprise Value. It is a complicated question that presents meaningful tradeoffs unique to each company and one that companies…

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  6. Hot M&A Market For Managed IT Services

    Current Trends in Managed IT Services Talent Scarcity – The biggest growth challenge cited by MSP operators is the scarcity of good IT Engineers and supporting talent. Because of this, employee retention is quickly becoming as important as customer retention in driving valuation Cybersecurity Tailwinds – Customers who previously hesitated to invest in security are…

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