Why are MSP acquisition multiples falling in the Netherlands?

The Dutch MSP market is further along in its development than the Belgian one. Clients there have become used to full managed contracts instead of separate licences and project hours. In Belgium a larger part of revenue still sits in pure licence resale and occasional services. That difference in service model explains the higher managed services ratio at Dutch MSPs, even though it does not translate into higher acquisition multiples.

The reported range depends heavily on size, recurring revenue and stack quality. Smaller MSPs with a limited share of fixed contracts often get few serious bids. Parties with a high percentage of recurring revenue, a clean stack and some scale sit higher, but the time when 6 to 7 times EBITDA was standard for average companies is behind us in the Netherlands. For a concrete indication an individual valuation is needed.

Buyers only accept revenue that is contractually fixed, with clear terms and notice periods. Time and materials billing and separate projects do not count, even if they recur every year. An MSP preparing for a sale therefore first puts verbal agreements into rolling contracts, standardises pricing models and makes sure invoicing and administration demonstrate the recurring nature of the revenue.

Timing is decided by market phase and your own position. In a market early in consolidation, as Belgium is now, multiples are higher because buyers are actively building. In a saturated market such as the Netherlands, timing is less favourable, unless an MSP stands out with a high share of recurring revenue, a standardised stack or a specific niche position. Waiting for better multiples only makes sense if something underneath improves.