LMM M&A Market Snapshot — June 24, 2026

Every week I track what buyers are paying in the lower middle market. Not what the headlines say. Not theoretical multiples from pitch decks. Real closed transactions with sources. Here is what the market looks like for the week of June 24, 2026.

Digital Marketing and Agencies: Retainer Revenue Is Commanding a 5-Year High

If you own a digital marketing agency with a retainer-heavy client base, the market is paying attention right now.

Agency deal activity is up 13% year over year. The adtech and martech segment is seeing EV/EBITDA medians reach 10.1x in North America and Europe. At the lower middle market level where most founder-owned agencies sit, the spread between a retainer-driven firm and a project-heavy firm is substantial: 5x to 7x EBITDA for agencies generating 60% or more in recurring revenue, versus 3x to 4.5x for project-based shops.

That gap is not arbitrary. Buyers underwrite to predictability. When 60% or more of your revenue renews annually, a buyer can model cash flow with confidence. When revenue is project-dependent, they cannot. That uncertainty gets priced in.

Larger agencies clearing $5M or more in EBITDA are reaching 8x to 12x for the right strategic or PE buyer. Those are not outlier numbers for 2026. They reflect the premium the market places on scaled, recurring-revenue operations with documented client retention.

(Source: Lightning Path Partners agency multiples analysis; agencies.co 2026 guide)

SaaS and Tech: Private LMM Holding While Public Markets Compress

The public SaaS index dropped to 3.8x ARR in March 2026, driven largely by AI disruption concern in software categories. Private LMM is not following the same move.

Bootstrapped SaaS assets with Rule of 40 scores above 50% are holding 4x to 5x EV/Revenue in the $5M to $50M total enterprise value range. (See: what drives SaaS valuation multiples) Top-quartile assets, particularly those with strong net revenue retention and minimal churn, are reaching 7x or above. Profitable assets trade on EBITDA at 8x to 15x.

The signal worth noting is the Onestream acquisition by Hg Capital and General Atlantic at approximately 8x forward ARR. PE is still writing large checks for quality software assets. Private LMM assets with clean financials and low customer concentration are not being discounted by the public market correction.

(Source: Windsor Drake SaaS Multiples 2026, updated 2026-06-23; Aventis Advisors SaaS valuation multiples)

Ecommerce and DTC: Contribution Margin Is the New Multiple Driver

The aggregator-driven ecommerce boom is over. What buyers care about in 2026 is contribution margin and customer retention.

Ecommerce brands doing $1M to $5M in revenue are trading at 3x to 6x SDE. Scaled brands above $5M in revenue with multi-channel distribution are reaching 4x to 8x EBITDA. Amazon-only sellers are trading 1x to 2x lower than comparable omnichannel brands. The discount reflects concentration risk. A buyer financing an acquisition with debt needs revenue that does not depend on one platform's algorithm or terms of service.

The specific metrics buyers are underwriting to: LTV to CAC ratio of 3:1 minimum, and 30% or higher repeat purchase rate. Brands that can demonstrate customer loyalty through data, not just revenue growth, are commanding the premium end of the range.

(Source: Sofer Advisors DTC Ecommerce Valuation 2026 (2026-06-17); CT Acquisitions ecommerce multiples (2026-05-06))

Professional Services: EBITDA Multiples at Highest Level in GF Data History

GF Data's 2025 data is now confirmed: business services EBITDA multiples hit 7.4x, the highest recorded level in their database history. Q1 2026 professional services M&A volume rose 13% year over year, with 129 US transactions announced in Q1 alone.

The buyers driving volume are PE-backed rollups. Doeren Mayhew (backed by Audax), Aprio (Charlesbank), and Cherry Bekaert (Parthenon) are all actively acquiring. The acquisition targets they are paying premium multiples for share a common profile: contractual or recurring revenue, low client concentration, and documented processes that do not require the founder to be present for delivery.

Contractual professional services firms are trading at 6x to 8x EBITDA. Consulting and project-based firms are at 4x to 5x. Premium assets with documented systems and recurring client relationships are reaching 10x to 12x in the right process.

(Source: GF Data Q4 2025 via ACG (Feb 2026); Focus Bankers Professional Services Spring 2026)

What the Market Is Telling Us This Week

• Fewer deals, full prices. GF Data counted 297 completed PE-sponsored LMM transactions in 2025, down 23% year over year. EBITDA multiples held at 7.2x. Q1 2026 ticked up to 7.3x. Quality assets are not being discounted by lower deal volume. Buyers are being more selective, not cheaper. (Source: GF Data Q4 2025; Mercer Capital Q2 2026)
• PE dry powder is still substantial. Approximately $880B in US PE dry powder is waiting to be deployed. Axial tracked a record 12,856 deals coming to market in 2025, up 17% year over year. Platform acquisitions are averaging 7.6x versus 6.5x for add-ons, the widest spread in recent history. Sellers who can position as platforms rather than tuck-ins get paid differently. (Source: Mercer Capital Q2 2026)
• SBA financing is holding the lower end of the market. Traditional buyouts represented 86% of Q1 2026 deal activity. SBA financing remains accessible for sub-$5M ecommerce and agency deals. Deal flow at the lower end of the LMM is not frozen. (Source: Mercer Capital Q2 2026)

What This Means for Your Exit Timing

The data for June 24, 2026 points to one clear conclusion for digital agency founders: the buyers are active, the multiples are high relative to recent history, and the premium is going to firms with documented recurring revenue.

This is not a permanent window. Agency M&A volume follows broader PE activity. If PE dry powder deployment slows further or interest rate conditions shift, the buyer pool narrows and multiple compression follows. The 13% year-over-year increase in deal activity is a current condition, not a guaranteed future.

If you have 60% or more of your agency revenue on retainer, you are sitting on an asset buyers want right now. The question is whether you run a real process with multiple competing buyers, or you take the first call from a strategic who found you and negotiate blind.

I have been on the wrong side of that trade personally. I named a number completely out of thin air on my first exit. I was negotiating blind. The difference between that outcome and what I help clients achieve today is preparation, multiple buyers, and price driven by competition, not by confidence.

If you want to understand what your agency is worth in this market, book a free valuation call.

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Frequently Asked Questions

What are digital marketing agencies selling for in 2026?

Retainer-heavy agencies are trading at 5x to 7x EBITDA in the current market. Project-based firms trade lower, at 3x to 4.5x. The spread reflects one thing: revenue predictability. Agencies with 60% or more of revenue on retainer or annual contract are commanding a meaningful premium. Larger agencies with $5M or more in EBITDA are reaching 8x to 12x for the right buyers. (Source: Lightning Path Partners agency multiples analysis; agencies.co 2026 guide)

What is driving agency deal activity up 13% year over year?

Two forces. First, adtech and martech deal activity is up 13% YoY with the EV/EBITDA median for marketing technology assets rising to 10.1x in North America and Europe. Second, PE-backed platform buyers are acquiring agencies to layer AI capability and data assets on top of existing client relationships. Founders who built recurring revenue models are sitting on assets PE is chasing right now. (Source: agencies.co 2026 guide; Lightning Path Partners agency multiples analysis)

What should a digital agency founder do to position for a strong exit?

Get your revenue base to 60% retainer or recurring before going to market. That one metric is the difference between a 3.5x and a 6x multiple in this environment. Document which clients are on annual contracts, what the average relationship length is, and what your churn rate has been. Buyers underwrite to predictability. Then run a process with multiple competing buyers, not a single strategic who found you first. Competition is what drives price.

Is this a good time to sell a professional services firm?

GF Data reported business services EBITDA multiples at 7.4x in 2025, the highest in their database history. Q1 2026 professional services M&A volume rose 13% year over year with PE-backed rollups actively acquiring. Contractual or recurring-revenue professional services firms are trading at 6x to 8x EBITDA. The window is real and data-supported. (Source: GF Data Q4 2025 via ACG; Focus Bankers Professional Services Spring 2026)

What is happening in the broader LMM right now?

Deal volume is down but prices are holding. GF Data counted 297 completed PE-sponsored transactions in 2025, down 23% versus 2024. Average EBITDA multiples held at 7.2x. Q1 2026 rose to 7.3x. Fewer deals closing means quality assets are getting more buyer attention, not less. Founders who go to market with clean books and recurring revenue are seeing full prices even in a compressed deal environment. (Source: GF Data Q4 2025; Mercer Capital Q2 2026)