The relentless pursuit of MORE is an addiction afflicting a lot of business owners . MORE and BIG are often incorrectly associated with success . If you get MORE leads , MORE clients , and MORE recurring revenue , many are impressed .
However , MORE can also mean more stress , more employees , more moving parts , more ways for things to go wrong , more costs , and more long days and weekends worked . But another , possibly smarter , strategy is to figure out how to do MORE of the good things ( revenue and profits ) with LESS and FEWER .
That ’ s why a lot of MSPs are moving upstream to sell co-managed IT — it provides bigger , more reliable , and more profitable MRR with fewer clients .
For starters , co-managed IT contracts represent bigger MRR dollars mostly because you ’ re dealing with larger organizations that have an IT department ( usually 70-plus users , often into the thousands ). It ’ s very common for contracts to exceed seven figures — and it ’ s good business , too . Unlike small businesses , these companies are typically more professional , knowledgeable buyers who have IT budgets and are willing to invest in cybersecurity and IT to lower risks and keep the organization humming along . The contracts tend to be for a longer term as well , frequently being sold on three-year terms .
As the image on this page demonstrates , the trend of co-managed IT is growing exponentially , driven by the ever-increasing threats of cybercrime , regulatory compliance , and the labor shortage that is not going away anytime soon . Many companies simply don ’ t want the cost or distraction of building an internal IT team and are outsourcing as a means for lower costs and getting a more reliable and experienced bench of engineers and experts .
What IS Co-Managed IT Exactly ?
Simply , co-managed IT is any type of IT service you deliver to a company with an
Co-Managed IT As An Opportunity
internal IT department where you are “ co-managing ” IT for that organization . In some cases , the MSP is only supporting the servers .
In other scenarios , the company doesn ’ t want you to touch the servers but only deliver help desk support . Some MSPs are simply selling and subleasing the tools for managing tickets , RMM , etc . In talking to dozens of MSPs who deliver these services , many have said that they have to be packaged , priced , and delivered on a case-by-case basis , with each client needing something slightly different . Over time ( and IF you do a great job ), that scope of work is likely to expand as the organization discovers they can rely on you for many aspects of IT , such as budgeting , documentation , security , compliance , and more .
Further , growing companies will constantly have greater needs and dependence on IT , which means they are likely to have projects they will hire you to complete .
What Drives The Sale : Psychographics And Characteristics Common Among Buyers
Because this sale requires buy-in not only from the C-suite but also the IT leader , and because you don ’ t want the IT leader to feel as though you are attempting to replace them or not respecting their position ( you WILL have to work with them , after all ), you will need to have different marketing materials , approaches , and sales presentations .
Selling To The C-Suite
In some cases , the CEO knows their IT leader or team is inadequate and is frustrated with projects not getting done , employees complaining about problems , etc . They are likely to have a sense that their IT lead is not keeping them secure and compliant ( or might KNOW they aren ’ t ). They may want to meet with you privately to discuss replacing their entire IT department or the leader to solve this .
In this case , you ’ re essentially selling full managed services as you would to any other small business without an IT department .
However , sometimes the CEO ( or C-suite ) likes their internal IT person or department but understands their limitations in knowledge or time restraints in getting everything done . Whatever the case , here are the common fears and frustrations CEOs have that will bring you in .
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