Security Systems Integrator Valuation
29 valuation methods · 43 industries · Results in under 10 minutes
In short
A security systems integrator is usually valued on seller's discretionary earnings: EBITDA plus the owner's pay. VA values monitoring and service contracts as their own layer, at a higher multiple than installation projects, and lowers the multiple on installs in new construction.
Who this is for
Owners of access control, video surveillance, intrusion and alarm integration companies preparing to sell, bring in a partner or plan succession, and buyers who need monitoring and service contracts separated from installation projects.
How is a security systems integration company valued?
VA values an owner-run security systems integrator on seller's discretionary earnings: EBITDA plus the owner's pay, because a buyer replaces the owner. Monitoring, hosted access and service contracts are valued as their own layer, at a higher multiple than one-off work, and that multiple rises with the share of customers who renew. Installation project work is valued at a lower multiple that rises with the company's size and falls as work for new construction takes a larger share. Comparable companies, precedent transactions and a discounted cash flow check the result, and an asset floor keeps it above what the company's own assets would recover. This tool is informational only. Output is driven by your inputs and does not constitute a formal appraisal or certified valuation.
What drives the value of a security systems integration company?
- Monitoring, hosted access and service contracts, and the share of customers who renew them
- The split between retrofit and service work in existing buildings and installs in new construction
- Manufacturer certifications and dealer agreements that let the company sell and service the systems it installs
- Licensed and certified technicians, and how long they stay
- How much of the business depends on the owner's own relationships with contractors and facility managers
- Customer concentration, and how long the largest accounts have stayed
What lowers the value of a security systems integration company?
- Few monitoring or service contracts, or customers who do not renew them
- A large share of installs in new buildings, which follow the building cycle
- Lapsed dealer agreements, or dependence on a single manufacturer
- Revenue that depends on the owner's own relationships
How much is a security systems integration company worth? A worked example
An integrator with monitoring contracts
Take a security systems integrator with $5 M of revenue, $750 K of EBITDA and $150 K of owner pay: $900 K of seller's discretionary earnings. Monitoring and service contracts bring in 30% of revenue, 90% of those customers renew each year, and 30% of revenue is installs in new construction. The trades model values the contract share of earnings at 4.8× and the rest at 2.7×, about $3 M before debt, or 3.33× the owner's earnings. Without the contracts, the same earnings come to about $2.43 M.
Illustrative figures from the industry model alone. A full report blends it with a discounted cash flow, comparable companies and precedent transactions.
Value your security systems integration company in under 10 minutes
- 1.Upload your financial statements, or type the figures in.
- 2.Confirm the add-backs and the industry details the model asks for.
- 3.Get a valuation range, the methods behind it and a PDF memorandum.
Which numbers matter most?
Seller's discretionary earnings
EBITDA plus the owner's own pay and perks. VA uses the pay you enter; for a small owner-run company with no figure entered, it estimates a working owner's salary.
Recurring monthly revenue
Monitoring, hosted access and service contract revenue. VA values it as its own layer, separate from installation projects.
Contract renewal rate
The share of contract customers who renew each year. The multiple on the recurring layer rises with it.
New-construction share
The part of revenue from work on new buildings. It follows the building cycle, so VA lowers the multiple on one-off work as it grows.
Technician certifications
The manufacturer and industry certifications your technicians hold. Buyers check them because the dealer agreements depend on them.
What do you need to value a security systems integration company?
- Profit and loss statements and balance sheets, ideally for the last three years
- Figures for the current year to date
- A list of add-backs: the owner's pay and perks, and any one-off costs
- Loan and lease balances
- A list of monitoring and service contracts, with renewal dates
- Revenue split between contracts, retrofit and service work, and new-construction installs
- Your technicians' certifications and the manufacturer agreements you hold
Example scenarios
Monitoring against installs
Two integrators earn the same. One has built a base of monitoring and service contracts that customers renew every year; the other lives on installation projects it has to win again each year. VA values the first higher, because its contract layer is priced at the higher multiple.
An integrator tied to new buildings
An integrator does most of its work installing systems in new buildings for general contractors. Its earnings follow the building cycle, so VA applies a lower multiple to that work than to retrofit and service, and the company is worth less than a service-led peer with the same earnings.
Further reading
How to Value an HVAC Business in 2026: SDE and EBITDA Multiples
HVAC businesses sell for about 2x to 3.3x SDE for small shops and 5x to 9x EBITDA for larger firms. See 2026 multiples by size and what drives the number.
Is a Business Worth 3 Times Profit? When It Is 2x, When It Is 5x, and Which Profit Counts
Is a business worth 3 times profit? Often, if the profit is SDE. When 2x or 5x applies instead, which profit counts, and what diligence does to the price.
How Much Is a Business Worth With $500,000 in Sales? The Revenue Ladder From $100K to $3 Million
Revenue does not set a price, earnings do. See what businesses at $100K, $200K, $300K, $500K, $1M, $2M and $3M in sales are worth at 10%, 20% and 30% margins.
Frequently asked questions
How is a security systems integrator valued?
On seller's discretionary earnings, EBITDA plus the owner's pay, with monitoring and service contracts valued as their own layer at a higher multiple than installation work. Comparable companies, precedent transactions and a discounted cash flow check the result.
Does recurring monthly revenue raise the value?
Yes. VA values contract revenue as a separate layer, and the multiple on it rises with the share of customers who renew. Enter the contract revenue and your renewal rate to see the effect.
Do manufacturer certifications matter?
They do not change the model's multiple, but buyers check them closely, because a lapsed dealer agreement can stop the company selling and servicing the systems its customers use.
Is monitoring I resell from a central station still recurring?
Yes, if customers sign contracts they renew. Enter that revenue with your other contract revenue; what matters to the model is that it repeats.
What if I pay myself less than a manager would cost?
Seller's discretionary earnings add back your own pay, so the level you pay yourself does not change that figure. A buyer who hires a manager will still look at EBITDA after a market salary, which is why the EBITDA-based checks are shown too.
Is this a certified appraisal?
No. This is an informational estimate. A bank loan, a partner buyout or an estate matter may require a certified business appraisal, which this does not replace.
Terms used on this page
- Seller's discretionary earnings (SDE)
- EBITDA plus the owner's own pay and perks. It shows what the business earns for one owner who works in it, and it is the figure most buyers of small owner-run businesses price.
- Add-backs
- Costs added back to reported earnings because a new owner would not bear them: personal expenses run through the business, one-off costs, or owner pay above what the role would cost to fill.
- Recurring revenue
- Revenue that repeats without a new sale, such as maintenance agreements, service plans or contracts customers renew.
- Renewal rate
- The share of customers on agreements or plans who renew each year.
- Valuation multiple
- The number earnings are multiplied by to reach a value. It rises with how durable the earnings are and how easily a new owner can keep them.
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Last reviewed September 25, 2026 against VA's valuation models.