Updated June 2026
Home / Cybersecurity M&A / Selling to Private Equity
Private equity has been one of the most aggressive consolidators in cybersecurity, taking public leaders private and rolling up point solutions into platforms. To sell well, lead with recurring ARR, retention, and a defensible position in a category buyers want to own. Most cybersecurity companies sell for between 6x and 15x revenue. Identity, detection, and other recurring-ARR platforms reach the top of that range; services-heavy MSSP and MDR models trade lower, often at 1x to 3x.
Cybersecurity sits at the intersection of two things private equity loves: durable, recurring revenue and a structural tailwind that does not depend on the economic cycle. Threats keep growing, budgets keep rising, and customers rarely remove a control they have deployed. Sponsors such as Thoma Bravo have built a thesis around platformization: acquire strong point solutions in identity, detection, data security, and posture management, integrate them, and sell the customer a suite rather than a tool. That makes a well-run independent vendor with sticky ARR a natural target, either as a platform to build around or as an add-on that fills a gap in an existing portfolio.
A sale to private equity runs as a managed, competitive process rather than a single conversation with one buyer. It begins with preparation: a quality-of-earnings review, a clean data room, and a defensible model of recurring revenue and retention. An advisor then approaches a curated set of funds at the same time, which is what creates leverage on price and terms.
From launch to close, a well-run cybersecurity process typically takes four to seven months: two to three weeks to prepare materials, three to five weeks in market to indications of interest, management meetings and a round of letters of intent, then eight to twelve weeks of confirmatory diligence and legal documentation. The firms that pay the most are rarely the first to call. They are surfaced by running a real process.
The sharpest divide in cybersecurity value is product versus services. A sponsor pays a software multiple for recurring, high-retention product ARR and a much lower services multiple for revenue that depends on billable people.
Cybersecurity deals follow the broader PE pattern with a platform emphasis. A strong independent vendor is often bought as a platform at a full multiple, with the founder rolling equity and staying on to drive the integration of future add-ons. Smaller or single-product companies are acquired as add-ons to an existing portfolio platform, priced lower but a faster route to close. Majority recapitalizations let founders take cash off the table while retaining upside in the larger, consolidated entity. Earnouts are common where a product roadmap or a key certification is still maturing, and should be tied to milestones you control.
Private equity has reshaped cybersecurity, and one firm leads it. Thoma Bravo has assembled the largest security portfolio in private equity, including SailPoint, Proofpoint, Sophos, Ping Identity, ForgeRock, and Imperva. It is joined by specialist buyers such as Crosspoint Capital and Symphony Technology Group, the owner behind Trellix and the former McAfee enterprise business, along with Permira, Advent, TPG, and Francisco Partners. Recurring-ARR platforms in identity and detection draw the most competition; services-led MSSP and MDR businesses attract a smaller, value-focused pool.
These are working ranges for 2026. Your own multiple is set by the durability of your revenue, retention, and growth, and ultimately by how many credible buyers a process puts in competition.
Most cybersecurity companies sell for between 6x and 15x revenue. Recurring-ARR platforms in identity, detection, and data security reach the top of that band; services-heavy MSSP and MDR businesses trade far lower, frequently at 1x to 3x revenue. The split between product and services revenue is the largest single driver.
In most cases you sell a majority stake and keep a minority position and your operating role. Founders frequently stay on to anchor a platform and lead the integration of bolt-on acquisitions, sharing in the larger eventual exit.
Four to seven months is typical from launch to close, with extra time on the back end if government certifications or change-of-control reviews (for example FedRAMP or customer security re-attestation) are involved.
Rollover equity is the portion of proceeds you reinvest in the recapitalized company. In cybersecurity platformization, where the sponsor builds something much larger before exiting, that retained stake can be especially valuable at the second sale.
Smaller product companies are routinely acquired as add-ons to a platform, where a defensible niche and clean recurring ARR matter more than size. Pure services businesses below meaningful scale draw a narrower pool and lower multiples.
The quality and recurrence of revenue, the product-versus-services mix, gross and net retention, the defensibility of the category position, and security and compliance posture, including the company’s own certifications and how it handles customer data.
The most active sponsors are listed above. In short, the largest software and fintech investors, led by firms such as Thoma Bravo and Vista, compete hardest for recurring-revenue platforms, while smaller or specialist funds buy add-ons and services businesses. A process should put several of them in competition rather than relying on one relationship.
It depends on the asset. A strategic buyer can sometimes pay more when there are real cost or revenue synergies, because the business is worth more inside theirs. Private equity competes on a clean financial basis and adds two things a strategic rarely offers: meaningful rollover with a second exit, and continuity for you and your team. The only way to know which pays more for your company is to run a process that tests both at once.
In a majority recapitalization you typically take most of the value off the table in cash and roll a minority, often 10 to 40 percent, into the new entity. A full sale is all cash but forfeits the second bite. The right mix depends on how much future upside you want to keep versus de-risk today.
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