Selling your security company? Know what it is really worth.
Physical security is a $50B+ U.S. industry experiencing rapid consolidation as major platforms — Allied Universal, Securitas, GardaWorld — continue to acquire regional operators. The convergence of physical and technology-based security is reshaping buyer preferences toward companies that blend guarding with technology services. Federal security spending, critical infrastructure protection mandates, and persistent demand for healthcare and corporate campus protection ensure stable demand. Independents with $2M–$20M in revenue are the primary acquisition targets.
National and regional security firms adding geographic coverage or vertical specialization, PE-backed security platforms, and individual operators scaling regional businesses. Allied Universal, Securitas, and GardaWorld each close 20–50 acquisitions annually.
Contract quality and vertical specialization — a company with multi-year government or critical infrastructure contracts and cleared personnel trades at 5x. Uniformed guards on month-to-month retail contracts trade at 2.5x.
Multiple ranges are directional and based on general market experience. Market multiples will vary based on your specific geography and market economics. Your valuation will include comparables that will establish your specific range of value.
The factors that push multiples to the top of the range.
Not all physical security / guard services businesses are created equal in the eyes of a buyer. The spread across the multiple range is enormous. Here is what separates the top from the bottom.
Government and critical infrastructure contracts
Contracts with federal agencies, state and local government facilities, or critical infrastructure — utilities, data centers, transportation hubs — command top multiples. These require facility clearances, employee background investigations, and compliance infrastructure that create significant barriers to entry.
Employee security clearances
Guards with active security clearances — Secret, Top Secret, TS/SCI — are scarce and valuable. Clearance processing takes 6–18 months and costs $5K–$50K per individual. A company with 50+ cleared personnel can service contracts competitors cannot bid on.
Technology integration capability
Companies integrating guarding with access control, CCTV monitoring, alarm response, visitor management, and AI-assisted surveillance generate higher margins and stickier relationships. The hybrid physical-technology model is what every major acquirer is building toward.
Contract duration and pricing escalators
Multi-year contracts with annual rate escalators protect margin in a labor-cost-driven business. Month-to-month contracts are valued at a discount. A book of 80%+ contracted revenue with 2+ years average remaining duration commands premium pricing.
Labor model and bill rate spread
Security is a gross-margin business driven by the spread between bill rate and pay rate plus burden. Companies maintaining 30%+ gross margin through disciplined pricing and controlled overtime demonstrate operational excellence. Buyers model bill rate spread by contract.
Insurance and risk management
Security companies face significant liability exposure. Companies with clean claims histories, low EMR, comprehensive training documentation, and adequate coverage limits reduce buyer risk. Armed guard services require additional scrutiny — firearms training records and use-of-force policies are deal-critical.
The deal structures owners need to know.
Strategic acquisitions
Allied Universal, Securitas, and GardaWorld have standardized acquisition programs with LOI-to-close timelines of 60–90 days. They pay premiums for companies with government contracts, technology capabilities, and $5M+ revenue in a single metro market. Structures are 60–75% cash with 15–20% earnout.
SBA and seller-financed deals
SBA 7(a) financing is available for smaller deals. Seller notes of 15–25% are common, often structured as contract retention notes that pay based on customer retention metrics over 12–18 months. Lenders scrutinize contract duration and concentration.
Government contract transfer
Government contracts may require re-bidding upon ownership change. Stock or membership interest purchases are sometimes preferred to avoid triggering anti-assignment clauses. Contract transfer is the primary deal complexity for companies with federal work.
Union and compliance considerations
A significant portion of large-contract guards are unionized. CBA terms transfer with the contract. State guard licensing, individual registration, firearms permits, and Service Contract Act compliance on federal contracts are all diligence items. Non-compliance is a deal-killer for government contract value.
The value gap
Most security company owners we work with are leaving $200K–$700K on the table by not extending contract terms and adding technology services before selling. Converting 10 month-to-month accounts to 3-year contracts and adding basic access control or monitoring services can move your multiple meaningfully.
The wealth gap
A security company doing $5M in revenue with $500K adjusted earnings at a 3.5× multiple walks away with $1.75M before taxes. After capital gains and transaction costs, that may be $1.3M. Is that your freedom number? The wealth gap is the distance between your exit proceeds and the life you want after.
The readiness gap
You built this company post by post, contract by contract. You know every client, every guard, every site requirement. That operational knowledge built the company — but it also makes it untransferable. If posts cannot be staffed, contracts managed, and quality maintained without you for 90 days, the readiness gap is open.
Questions owners actually ask.
What is my security company worth? ▸
Security guard companies typically sell for 1.5–3.5× adjusted earnings. On $500K adjusted earnings, that is a range of $750K to $1.75M. Where you fall depends on contract quality, government vs commercial mix, technology capability, clearance depth, and bill rate margins. A professional opinion of value gives you the real number.
Do the big companies really buy small security firms? ▸
Yes. Allied Universal, Securitas, and GardaWorld each acquire 20–50 companies annually. They have standardized processes and can close in 60–90 days. They pay premiums for geographic coverage, government contracts, and technology capability. If your revenue is $2M+ and you have durable contracts, you are in their target range.
How important are security clearances to my value? ▸
Very important for the right buyer. Cleared personnel are scarce and expensive to develop. A company with 50+ cleared guards can access federal contracts that most competitors cannot bid on. If you have cleared personnel, you have a competitive moat that commands premium multiples.
Will my contracts transfer to a new owner? ▸
Most commercial contracts will, but government contracts may have anti-assignment clauses that require re-bidding or government approval. The deal structure — asset vs. stock purchase — often depends on which approach preserves contract continuity. We help you navigate this.
What can I do in the next 12 months to increase my value? ▸
Three highest-impact moves: (1) Extend month-to-month contracts to multi-year terms with annual escalators. (2) Add technology services — access control, CCTV monitoring, guard tour verification — to increase margins and stickiness. (3) Tighten your insurance and training documentation. These moves routinely add $200K–$500K to a security company exit.
Know your number
We value your security company using real comps from completed security industry transactions — not generic formulas. You get a professional opinion of value with contract quality analysis, clearance depth assessment, bill rate margin review, and the earnings adjustments specific to guard services.
Grow your value
If you have runway, Value Growth coaching helps you extend contract terms, add technology services, build management depth, and tighten compliance documentation. Each improvement moves your multiple — and we know which ones security industry buyers actually pay for.
Sell on your terms
When you are ready, we list the company, screen and qualify buyers (Allied, Securitas, GardaWorld, PE platforms, regional operators), negotiate the deal structure, manage contract transfer, and sit at the closing table.
Know what your security company is really worth.
The first step costs nothing. Tell us about your business and we will send a market intelligence brief specific to physical security in your geography in 24–48 hours. No forms to fight, no pitch attached.