Sophos’ Scott Barlow

Outside of the global M&A surge, there are specific issues unique to MSPs that drive the M&A boost. Scott Barlow is VP of global MSP and cloud alliances at Sophos. He said owner retirement, regional or geographic expansion, complementary services and vertical expansion have all played a role in fostering deals.

Cybersecurity is also a factor.

Out of 489 cybersecurity professionals surveyed by Information Systems Security Association International, 95% of respondents said the cybersecurity skills shortage and its affiliated impacts have not improved over the past few years, and 44% say it has only gotten worse. This ultimately influences M&A.

“We see an acceleration of M&A due to the global shortage of qualified resources as cybersecurity threats advance globally,” Barlow said. “I think the current growth and momentum in M&A deals will positively impact the MSP industry. Many MSPs are inherently more focused on the technology, so when an M&A occurs, it’s a net positive for both organizations and creates greater synergy.”