Alarm Company Business Valuation
Alarm & Security Monitoring Business Valuation Calculator & Exit Planning Built for Security Company Owners
We built one platform that tracks your alarm company's value monthly, identifies exit gaps early, and ensures your personal finances align with your exit timeline.
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Most Alarm Company Owners Have No Idea What Their Business is Actually Worth
Current Alarm / Security Monitoring Valuation Multiples (2026)
Alarm company valuations are driven by Recurring Monthly Revenue (RMR). Here's the market:
Every business is different. That's why you need to track your value.
Included in Your Exit Value is a complete Exit Planning Assessment where you track your progress quarterly against your results from the previous quarter.
Know your number and watch it grow
Most business owners guess at their value. You'll know it with precision.
Our platform uses six proven valuation methodologies to give you a complete picture of what your business is worth today—and tracks how that number changes month over month. No more waiting for annual appraisals or paying $15K+ for outdated reports.
See your trends. Spot opportunities. Make informed decisions
What Actually Drives Alarm Company Value
Your customer service matters, but sophisticated buyers evaluate these factors that determine premium pricing:
RMR Quality
Low Attrition, Long Contracts
Not all RMR is equal. Attrition rate is the most important factor—low attrition (under 10% annually) demonstrates customer satisfaction and contract enforceability. Contract term remaining and auto-renewal provisions matter. High-quality RMR with low attrition commands premium multiples (40x+); high-attrition RMR gets discounted significantly.
High attrition = lower multiples
Account Mix
Residential + Commercial Balance
Commercial accounts typically have lower attrition and higher RMR per account than residential. A mix of residential and commercial demonstrates market capability. Heavy residential concentration faces more competition; commercial-heavy can be more valuable if accounts are diversified.
Residential-only = competitive pressure
Technology Platform
Modern Systems, Interactive Services
Older panel technology may need replacement. Modern systems with interactive services (app control, video, automation) command higher RMR and demonstrate technological currency. Acquirers evaluate your installed technology mix. Outdated systems may require upgrade investment.
Legacy panels = upgrade needed
Monitoring Arrangement
Established Central Station
How do you handle monitoring—owned station, wholesale monitoring, or third-party? Your monitoring arrangement affects margins and operational complexity. Understanding your monitoring economics and contracts matters for deal structure.
Poor monitoring = margin impact
Contract Documentation
Clean, Assignable Contracts
Buyers acquire your contracts—documentation quality matters enormously. Signed contracts with clear terms, proper assignment provisions, and organized records enable smooth due diligence. Missing or incomplete contracts create problems that reduce value or kill deals.
Poor documentation = deal risk
Installation Revenue
Balanced Install + Monitoring
Many alarm companies have installation revenue alongside monitoring. While RMR drives multiple, strong installation capability provides customer acquisition and equipment revenue. Understanding the relationship between your install business and monitoring growth matters.
No install = growth dependent on acquisitions
How to Value an Alarm and Security Monitoring Business
The U.S. alarm and security monitoring industry includes thousands of companies generating approximately $25 billion in annual revenue. Alarm companies install security systems and earn recurring monthly monitoring revenue (RMR) from connected accounts.
Recurring Monthly Revenue (RMR) multiples are the primary valuation method — unique to this industry. Alarm monitoring accounts typically sell for 30x to 45x monthly recurring revenue, depending on account quality. EBITDA multiples of 5.0x to 9.0x are also used for larger companies.
The RMR multiple translates to roughly 2.5x to 3.75x annual recurring revenue. Commercial accounts with higher RMR per account and longer average tenure command the premium end of the range.
The unique valuation factor for alarm companies is the RMR quality, attrition rate, and contract terms. Not all RMR is equal — accounts with written monitoring contracts, automatic payment methods (ACH/credit card), longer average account life, and commercial/business accounts are worth more than residential accounts on verbal agreements. Monthly attrition rate (the percentage of accounts that cancel each month) is the most closely watched metric — industry average is 12-14% annually, and companies below 10% command significant premiums. Account creation cost (the investment to install and acquire each account) impacts the payback period for buyers.
Alarm company M&A is extremely active, with major players like ADT, Brinks Home, and regional dealers constantly acquiring monitoring accounts. Use our free calculator above to get your instant estimate, then track your value monthly with YourExitValue.
Frequently Asked Questions
What multiple do alarm companies sell for?
Alarm companies typically sell for 25x – 45x monthly RMR. Companies with low attrition, modern technology, and clean contracts command 40x+ multiples; high-attrition accounts get discounted.
How does attrition affect alarm company value?
Dramatically. Attrition is the most important factor. Under 10% annual attrition commands premium multiples; high attrition (15%+) significantly reduces value. Track and reduce attrition.
Who buys alarm companies?
National security companies (ADT, etc.), regional alarm consolidators, PE-backed security platforms, and monitoring companies seeking RMR growth through acquisition.
Does technology affect alarm company value?
Yes. Modern systems with interactive services command higher RMR. Outdated panels may require replacement investment that buyers will factor into offers.
How important is contract documentation?
Critical. Buyers acquire your contracts. Clean, signed contracts with proper assignment provisions are essential. Missing documentation creates deal risk.
What's the fastest way to increase my alarm company value?
Three high-impact moves: 1) Reduce attrition through customer service and contract enforcement, 2) Grow commercial accounts for higher-value RMR, 3) Ensure all contracts are signed, organized, and assignable.