MRR

Monthly Recurring Revenue. The predictable, subscription-based revenue an MSP receives each month from active managed services agreements. MRR excludes project revenue, hardware resale, and one-time fees. It is the most important financial metric for MSP valuation — acquirers typically pay 1-1.5x ARR (annual recurring revenue) or higher multiples when MRR quality is strong (high retention, diverse client base, contractual terms).

Related metric

ARR (Annual Recurring Revenue) = MRR × 12. Used in valuation models and investor conversations.

MRR vs. total revenue

An MSP with $400K MRR and $200K in annual project revenue has $4.8M ARR from recurring sources and $5M total revenue.

Why it matters

MRR is the metric buyers care about most. High MRR on long-term contracts with low churn is the single largest driver of MSP valuation multiples.