- AI, regulation, and consolidation are forcing a major reinvention of the MSP business model.
- Adapting to new technology is now MSPs’ top business health concern.
- Many MSP professionals are over 55, driving a generational decision point.
- Over half of MSPs are preparing for a sale or exit, accelerated by AI adoption pressures.
- Collective and community-led ownership models are emerging as alternatives to private equity exits.
AI, regulation, and consolidation are reshaping the MSP market—but not everyone plans to go with it.
Conversations are currently happening, but not on conference stages or in vendor keynotes. They’re taking place at industry dinners and events, in Reddit chatrooms and in late-night discussions between MSPs who’ve already lived through more reinvention cycles than they care to count.
That’s because for many MSP owners now in their 50s and 60s, the question isn’t whether the industry is changing. It’s whether they still want to change with it. So what’s the best strategy? Is it time to explore M&A, or to double down and invest?
The reinvention cycle MSPs can’t avoid
Over the past two decades, we’ve seen reinvention become the norm. Break/fix became managed services. On-prem became Cloud. Reactive IT became security-led delivery. Each cycle required investment, retooling, retraining and risk. And for a long time, the industry rewarded those who adapted early.
The MSP GLOBAL State of the Industry Report 2025 found that adapting to new technologies is now the top concern when it comes to business health, ranking above customer experience, cybersecurity, and revenue diversification.
But this isn’t just another technology shift. AI and automation are changing how services are delivered, how margins are created, how staff are deployed, how compliance is managed and how value is measured.
At the same time, regulation, certification and governance expectations are rising. Not just for MSPs directly, but for their clients. Governance frameworks, cybersecurity regulation and sector-specific compliance regimes are turning “nice-to-have” controls into contractual requirements.
Layer on top of that stricter vendor accreditation requirements, reduced partner support, hyperscalers going direct, the rise of Cloud marketplaces and increasing margin compression and it becomes clear that this isn’t a step-change—it’s systemic.
A generational shift
The MSP sector doesn’t talk openly about age, but the data tells a story. Industry research from the United States shows that nearly half of MSP professionals are now over 55, with a significant proportion over 65. While this data reflects workforce demographics rather than ownership specifically, leadership in MSPs historically rises through technical and operational ranks—meaning ownership profiles tend to mirror the same age curve.
Many founders built their businesses in the early 2000s. They’ve been operating for 20–30 years. Their peer group has already started exiting. Some have sold. Some have merged. Some have stepped back.
One MSP owner, currently considering retirement, told MSP GLOBAL: “Most of my peers sold out a while ago. Now there’s Microsoft making accreditation more stringent, less support coming from vendors, more competition from vendors going direct, and more business going through marketplaces.
Elsewhere, one MSP owner on Reddit summed it up: “It’s not burnout. It’s a sober conclusion. The fun is gone.”
That indicates that while the numbers still matter, they’re no longer the whole story.
When MSP M&A becomes personal
According to the Global Technology Industry Association (GTIA), cybersecurity risk, the pace of innovation, and chronic skills shortages are now the biggest challenges IT service providers face when integrating AI into their businesses. Each requires investment and retooling across multiple fronts that older owners might not find worth it as they are trying to make their company look profitable.
At the same time, sentiment around exit is shifting. More than half of IT service providers told GTIA for an upcoming report that they are either actively prepared to sell or already feel structurally attractive with some optimization, and nearly three-quarters report being at least in early planning stages for a future exit.
In other words, AI isn’t just creating opportunity—it’s accelerating decision-making. Many owners aren’t asking “Can we adopt AI?” They’re asking, “Do I want to rebuild the business again?”
However, for many founders, the MSP isn’t just a business; it’s who they are. Walking away isn’t just an exit—it’s a loss of identity, independence, and purpose.
Here, it’s worth noting that for MSP owners contemplating a sale but wary of the traditional private equity route, new models are emerging that offer alternatives to the classic “sell and walk away”. Currently focused on the US market, similar moves can be expected in Europe and beyond.
One example is the MSP Owners Group, which is building a community-driven platform where MSPs can come together to scale and eventually transition ownership on terms they control. Rather than ceding control to private equity—often at the cost of culture, continuity, and long-term legacy—this model emphasizes community, shared resources and choice, allowing owners to sell equity while remaining engaged if they wish.
The MSP Owners Group isn’t alone—other collectives such as The 20 and Evergreen Services Group also provide pooled resources, shared infrastructure and strategic alignment for MSPs looking to grow or transition without losing their identity.
What’s notable about these alternatives is that they acknowledge a common sentiment among MSP owners: you might not want to exit completely, you might not want to hand the business to an outside investor who strips it for parts, and you might want to ensure your team and clients are taken care of long after you step back. For owners who want to stay involved, mentor the next generation, or slowly de-risk without disappearing overnight, these models may offer an attractive middle path.
Exit or evolve: the market split
The MSP industry has a strong future as complexity increases and demand grows. Clients need trusted partners more than ever. But what’s emerging is a clear split in the market.
For many owners, the question isn’t whether the industry will grow. It’s whether they still want to grow with it.
On one side are MSPs choosing to reinvest in AI-enabled delivery, automation-first operations, compliance-as-a-service models, platform integration, certification-driven credibility and process-led scale.
On the other are those choosing to prepare for exit. They are stabilizing revenue, de-risking client bases, professionalizing operations, reducing founder dependency and positioning for acquisition or merger. Both paths require investment, planning and intention.
Whether MSPs choose to exit or evolve, there is no right or wrong decision. The only mistake is waiting so long that the market chooses for them. Doing nothing is still a strategy—but it’s usually the most expensive one.
Join us at MSP GLOBAL 2026 to explore the options for growth or exit, learn from experts and network under the Spanish sun.
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