35-Year Specialty IT VAR & Managed Services Provider

Full Editorial Writeup

This is a 35-year-old specialty IT value-added reseller (VAR) and services provider that supports mission-critical operations for public-sector agencies and enterprise customers. The company sells specialized IT hardware, performs systems integration, and delivers field services under multi-year master service agreements. It holds top-tier authorized channel-partner status with major OEMs and recently won a statewide preferred-vendor contract that acts as a mandatory procurement vehicle for state-agency buyers, materially expanding its addressable market.

The business generated roughly $11M in revenue, $1.83M in cash flow (SDE), and $1.75M in EBITDA, with about 180 active accounts and no customer exceeding 15% of normalized revenue. Roughly 75% of services revenue is recurring under multi-year MSAs with annual price escalators, and the services mix has climbed from about 10% of revenue in 2022 to 26%+ in 2026 YTD. The company is a debt-free S-Corp with 30 employees, historically negligible bad debt, and a professional operations team in place.

What makes this notable is the combination of durable public-sector stickiness, hard-to-replicate OEM authorizations, and a clear shift from one-time product sales toward higher-margin recurring services. The seller is retiring and has structured the deal with an earn-out tied to future statewide-contract revenue, which both reflects confidence in the new contract and shifts some upside risk to the buyer. Location, OEM identities, and contract counterparties are withheld pending NDA.