Someone Offered to Buy Your IT Company — What to Do Before You Respond
Short answer: Don't react to the number. A single, unsolicited offer is a starting point, not a fair price — it was set with no competition, precisely so the buyer can acquire you before anyone else bids. Thank them, commit to nothing, then get an independent valuation and decide whether to put the offer into a competitive process. That decision is usually worth far more than the offer itself.
First, Do This
Thank the buyer, say you'll consider it, and commit to nothing. Then: get an independent valuation, learn your real recurring-revenue multiple, and decide whether to run a competitive process. A lone offer with no competition almost never reflects what the market would pay.
An unsolicited approach is flattering, and it's tempting to treat it as validation and move fast. Slow down. The buyer chose you, off-market, for a reason — and that reason is rarely to pay you the most.
Why the Offer Is Probably Too Low
Price is set by competition. An off-market offer has none — by design.
- No other bidders. The number reflects what the buyer hopes you'll accept, not what the market would pay with several qualified buyers competing.
- Information asymmetry. The buyer does this for a living; you may sell once. They know your value better than you do at this moment — that's the advantage they're using.
- Speed pressure. "This offer is only good for a short time" exists to stop you checking the market. Real value doesn't evaporate in a week.
To judge the number, you need your own. Start with what your MSP is worth and the multiple it should command.
What Not to Do
- Don't name a price back before you know your value — you'll anchor the whole deal to a guess.
- Don't sign exclusivity (a "no-shop" clause) — it removes your only leverage. More below.
- Don't hand over detailed financials without an NDA and a reason to trust the buyer is real.
- Don't tell staff or clients — a leak damages the business whether or not you sell. See selling confidentially.
- Don't go it alone on the paperwork — the binding terms are where value is quietly lost.
7 Steps Before You Reply
Acknowledge, don't commit
"Thank you — I'll consider it." Nothing more. No number, no timeline, no promise.
Get an independent valuation
Know your real range and recurring-revenue multiple before you discuss price.
Qualify the buyer
Are they funded and serious, or fishing? Who are they, and have they closed deals?
Protect information
NDA before anything detailed leaves your hands. Blind summary only, at first.
Refuse exclusivity (for now)
Keep the right to talk to other buyers until you understand your options.
Decide: process or not
Weigh running a competitive process against taking this one buyer further.
Get advice before binding terms
LOI, exclusivity, and the SPA are where money is won or lost. Don't sign blind.
The Exclusivity Trap
The buyer's first move is often to ask for exclusivity — a "no-shop" period where you agree not to talk to anyone else while they do diligence. It sounds reasonable. It is the single most valuable thing you can give away.
Once you're exclusive, the buyer has no competition and every incentive to chip the price during diligence (a "re-trade"), knowing you can't walk to another bidder. Never grant exclusivity before you understand your value and have decided whether to run a process. If you do grant it, keep it short and tie it to clear conditions.
How to Create Competition
The single best way to test an unsolicited offer is to make it compete. You don't have to abandon the interested buyer — you put them in a room with others.
- Get valuation-ready and build a blind profile that protects your identity.
- Approach the buyer types most likely to pay top dollar for your sub-sector — alongside the one who approached you. See who buys MSPs.
- Run it as a confidential process so the original buyer knows they're not the only option. That alone often lifts their number.
Competition routinely recovers far more than any advisory fee — it's the core reason a structured process beats a quiet bilateral deal. The full mechanics are in how to sell your IT company, and whether to bring in help is covered in do you need a broker?
When an Offer Is Worth Taking
Sometimes the approach is genuinely good — a strategic buyer who values a specific capability, a clean all-cash structure, terms that fit your life plan, or a price that already sits at the top of your range once you've checked it. The point isn't to reject every offer. It's to verify before you accept: know your value, test it against competition where you can, and make sure the structure (cash vs earn-out) matches what you actually want. An offer you've validated is one you can accept with confidence.
Don't reply until you know your number
Before you respond to any offer, get a free, confidential valuation of your MSP — so you negotiate from your own number, not theirs. No obligation, and your enquiry stays private.
Get My Free MSP Valuation →FAQ: Responding to an Offer
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MSPs & IT companies.
We focus on managed service providers and IT-services businesses — how they're valued on recurring revenue, what PE buyers underwrite, and how to package a founder-led MSP so it earns a premium multiple instead of a discount.
Den has 18+ years of direct P&L experience across 50+ business types and 12 markets, with a buyer network spanning PE platforms, family offices, and strategic acquirers across the US, EU, and Asia.
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