The line comes from the way MSP owners talk when they are tired: keep grinding, or turn off the lights. In that mood, people leave contracts, a desk, and a client list on the table because selling sounds like another job. It is another job. It is a finite one, and it is different from shutting down.
A sale is the honest path when
- A meaningful share of revenue is monthly recurring managed services, on contracts a buyer can read.
- Someone besides you can run the desk for more than a long weekend.
- No single client is the business. Breakwater’s sell guide uses about 15 percent of revenue as the concentration line buyers worry about.
- The books can survive a quality-of-earnings review, and the cyber basics (MFA, EDR, tested backups) are in place or can be put in place before a teaser.
Shutdown, or a year of conversion, is the honest path when
- The work is still mostly break/fix and projects. Buyers in the Breakwater profile table put that kind of firm in a 3×–4× SDE conversation, and only if there is discretionary earnings to multiply. That band is their published range, not an offer.
- You are the escalation path, the vCIO, and the after-hours phone. A buyer is purchasing a job with your name on it.
- One or two clients would end the company if they left, or the agreements are handshakes.
Converting break/fix into managed contracts is multi-year work. Doing it because you want a sale in ninety days does not change the file a buyer underwrites. Doing it because you might sell in two years can. So can deciding you will not sell, and winding the practice down on your calendar instead of a buyer’s.
IBBR’s job on the first call is to say which conversation you are in. If we are the wrong tool, we will say that. The exit readiness checklist is a way to look at the file before that call.