Cybersecurity and Scalability: The Pillars Driving Investment in MSPs
In December, many managed service providers (MSPs) took the opportunity to review their strategies and reassess priorities, while the end of the year encourages a closer look at how the market is evolving. Mergers and acquisitions (M&A) remain very strong in the MSP sector. According to a Drake Star report, 107 transactions were recorded in the United States in Q1 2025, with a disclosed total value of more than 1 trillion dollars. In Europe, according to the Boston Consulting Group’s (BCG) global M&A study, consolidation is also progressing, although at a different pace. During the first nine months of 2025, the total value of transactions reached approximately 375 trillion euros, reflecting an active market with higher valuations than those seen in North America.
This global momentum is driven not only by investor and strategic buyer return expectations, but also by concrete economic motivations: service expansion, increased geographic reach, and the pursuit of economies of scale and operational synergies, all with the shared objective of improving margins and profitability in a sector in which gross margins remain lower than those achieved by software companies. In this context, your company's ability to grow in a structured and profitable way has become a critical factor in attracting investment and strengthening your competitive position.
MSP Market Consolidation and Key Drivers
Beyond growth alone, many M&A transactions are driven by clear strategic objectives for your business. Expanding service portfolios, increasing geographic reach, and pursuing economies of scale and operational synergies have become the primary drivers of consolidation. To increase margins and profits, MSPs are increasingly adopting automation, service standardization, and AI-driven tools, enabling them to scale operations and improve profitability.
In this regard, investors prioritize MSPs with strong recurring revenue streams, high client retention rates, and a diversified base; factors that facilitate integration and support more efficient scaling. MSPs that meet these criteria tend to achieve stronger valuations and attract greater interest from investors and strategic buyers.
Consolidation also creates growth opportunities. Through strategic partnerships, service expansion, or acquisitions, MSPs can broaden their coverage and strengthen their competitive position. Capitalizing on these opportunities requires a long-term perspective: defining strategic objectives, anticipating regulatory changes, and reinforcing response capabilities in the face of critical incidents.
Cybersecurity and People: The Value That Truly Matters
While consolidation is redefining the structure of the market, cybersecurity remains a central pillar of an MSP’s value. It is no longer simply about deploying tools, the true differentiator lies in how you integrate these solutions into processes and how consistently you protect your clients. Services such as MDR, XDR, compliance reporting, and strategic consulting not only boost revenue, but also demonstrate operational maturity and response capability, key factors in any investment or acquisition operation.
Added to this is the human value. Accessible and committed support has a direct impact on client loyalty. According to WatchGuard’s Real Security for the Real World 2025 report, nearly 60% of companies consider support a key factor when choosing a security provider, and 55% of executives switch providers due to a lack of responsiveness or adequate support.
As an MSP, your competitive advantage lies in combining technology with genuine relationships. Knowing that real people are available when an issue arises not only strengthens trust but also enables faster incident response and helps maintain secure, uninterrupted operations. This approach makes your business more attractive to investors and partners.
Building on this foundation means having clear processes, integrated services, and a proven ability to scale security without compromising support quality, leveraging unified cybersecurity platforms that simplify the management of solutions and services by bringing monitoring, response, and compliance together across your clients’ entire environment. It also means that, beyond technology, your business needs to be designed to meet your clients’ real needs and maintain strong relationships, an element that is increasingly influential in the MSP market.
As the market continues to consolidate heading into 2026, MSPs that combine structured operations, integrated security, and a human approach will be better positioned to navigate the industry’s transformation. Consolidation reflects which businesses are built to grow, adapt, and earn trust. Prioritizing effective client protection, backed by accessible people and robust processes, is a strategic factor that strengthens your position with clients, partners, and investors, ensuring the long-term relevance and sustainability of your business.