The MSP space has become a “buyer’s market”, CloudClevr’s CEO asserted as he revealed plans to make another three to five acquisitions.
Ranking 154th in Oxygen 250 2026, the Rigby Group-owned MSP grew from zero to £32m revenues on the back of four acquisitions it made in 2023 and 2024 and spent the next 18 months integrating.
Now it will use a long-term funding agreement snared in November to kickstart the next phase of M&A, CEO Steve Harris told IT Channel Oxygen.
Standing at “some way over £10m”, the debt facility will be used to fund between one and two acquisitions each year over the next three years, Harris indicated.
“Much more of a buyer’s market”
While unrealistic valuation multiples were a theme of the market a couple of years back (see here and here), MSP owners have since reined in their expectations, Harris said.
“If you look at some of the multiples that were being paid 12 to 18 months ago, they were way up into double digits and beyond, even for a relatively small, £5m-turnover business,” he said.
“That’s definitely cooled off.
“There’s also a more limited [number of] players at the table.
“So I think it’s definitely much more of a buyer’s market.
“We’ve only been back in the market for three months, but certainly from early conversations with the corporate finance advisors and the companies themselves there seems to be a more realistic view.”
“It’s now just about scale”
CloudClevr’s business is “pretty well balanced”, with around a third of its revenues generated by digital workplace, network services, and IT & security, respectively, Harris said.
Its key vendors include Zoom, Mitel, Microsoft and Huntress.
“From an M&A perspective, we don’t feel we need to necessarily go out and buy additional capability,” Harris said.
“It’s now really just about scale and repeatability, so we want to buy businesses that fit into our ICP [ideal customer profile] of upper SME and midmarket.”
CloudClevr draws 80% of its business from the top 460 of its circa 1,800 customers, with its largest customer representing just 1.7% of gross profit, Harris said.
“We don’t really want to buy anything that gives us any further exposure or concentration, or too much of a long tail,” he said.
Despite refusing to rule out acquisitions in the comms space, Harris said future activity will likely focus more on the IT side due its greater cross-sell potential.
“I think where you might see some sort of premium is where you’ve got super-high recurring revenues, and also potentially some skill sets in the newer areas like AI data or intelligence – if people can really call out that they’ve got growing revenues in those high-growth segments, you might find they start to get an extra turn of valuation,” he said.
“We’ve done the heavy lifting”
CloudClevr’s quickfire acquisitions of NGC Networks, 4Sight Communications, Bamboo Technology Group and Twisted Fish handed it five offices, including three in the London area.
Having just closed its Richmond office, it now plans to consolidate its two remaining sites in the capital into one. This would leave it with three hubs in Cheltenham, Wakefield and southern London.
CloudClevr is on course to grow EBITDA and revenues to £4m and £35m-£37m in the fiscal 2027 period it has just started, Harris said.
As it is linked to its EBITDA position, CloudClevr’s new long-term funding facility with Natwest will “grow as we grow”, Harris said.
“A number of the players that perhaps were more prolific acquirers are going back out to get refinancing,” Harris said.
“Our debt was nothing to do with refinancing. It was all about growth and expansion. So I think we’re in a fairly good place to be competitive against even those companies that have now got the debt to go out and do it.”
Harris added: “We’ve done the heavy lifting, which I think is quite different to a lot of our competitors. It’s probably aged me considerably, but we’ve integrated four businesses and put them all onto brand new systems.
“It’s given us some really good foundations to deliver growth.”
Doug Woodburn is editor of IT Channel Oxygen
