In this episode of Shoot the Moon, the Revenue Rocket team—Ryan Barnett, Mike Harvath, and Matt Lockhart—unpacks a foundational concept in IT services  M&A deals: EBITDA add-backs. Whether you run a Managed Service Provider, a Microsoft or SAP channel partner firm, a cybersecurity practice, or a custom development shop, understanding what qualifies as a legitimate add-back can significantly affect your valuation in a transaction.

The team covers the good, the bad, and the ridiculous—breaking down why aggressive or misguided add-backs can backfire and erode trust with a buyer. They also explore how recurring bonus plans, inflated owner salaries, and "strategic" spend are treated when it’s time to negotiate your exit.

This episode is a must-listen if you're:

• Considering a sale or recapitalization in the next 12–36 months
• Wanting to improve your EBITDA story before going to market
• Wondering if that golf membership you expensed is helping or hurting your exit

Key topics include:

• The golden rule: “Add it back only if it’s truly gone—for good”
• Owner salary treatment (especially if you stay on post-sale)
• Bonuses, personal expenses, legal fees, and other gray zones
• Buyer synergies vs. seller add-backs—don’t confuse the two
• Real-world examples of questionable add-backs (boats, jets, services and all)

Listen to Shoot the Moon on Apple Podcasts or Spotify.

Buy, sell, or grow your tech-enabled services firm with Revenue Rocket.