At What Point Should An MSP Look At M & A ?
It ’ s such an individual answer . When talking with a business owner about what they should do with this precious thing that they put all their time , energy , and money into for years , I always say the best deal is the one that you ’ re happy with . I wanted to keep going for a while and I was looking for some place I could hang my hat and grow with scale . Some folks are at the end of their career and need the business to have an enduring legacy and wind up in the right hands . Some get tired of running a business . There ’ s a whole host of motivators , and those motivators are going to drive different outcomes depending on the situation .
One of my mentors told me , “ Don ' t do anything until you know what your next move is going to be . You don ’ t want to wake up and not have thought through that , because you ’ re going to have a considerable noncompete in front of you .”
What Are The Toughest Challenges For MSPs To Deal With Today And How Are You Overcoming Them ?
Talent acquisition and talent retention . We ’ re a 24 / 7 operation , so there is more churn . Overlay the work-fromhome , post-COVID environment and you must be incredibly intentional about culture . We used to have our service desk and NOC guys work in the office . You could feel the energy , put your arm around folks and mentor them .
I ’ m afraid the early-in career folks aren ’ t aware of all the stuff that happens when you ’ re in the office — sitting in a team meeting next to senior folks and hearing how they behave on a call , getting mentored in real-time as they ’ re working a trouble ticket , hallway conversations . . . I worry that it ’ s going to be costly as they try to advance through their careers and costly for businesses like ours that need to scale . The most effective way for us to scale is to hire into the NOC shift and bring them into a client team and then turn them into subject matter experts over time , and if they ’ re not in the office , it ’ s hard to make those progressions . We ’ re doing a lot of hard work there to create intentionality .
Have You Seen A Slowdown In Opportunities ?
We are not seeing it slow down . I have considerable growth targets put on my business from our board that they have effectively said , “ Whatever you need us to invest to deliver those growth targets , we will .” There ’ s a strong belief that — what I ’ ll call the outsourcing market — has a long way to go , especially where we ’ re living in that Russell 2000 midmarket commercial space .
Fred [ Voccola ] from Kaseya will tell you that is where the most action is because 1 ) it ’ s an unsolved market , and 2 ) it ’ s the last market to outsource . It ’ s that middle market that held onto their
IT departments for so long . They are finally saying , “ We have to take some or all of this and bring a third party in to help .”
What Would Be The Marketing Strategy If You Were Smaller ?
You must have a good technical solution and figure out how to assemble a good delivery team . Learn how to hire good salespeople and assemble and manage a good sales and marketing operation . Those are the critical keys to success , whether you go vertical or horizontal .
For MSPs that want to grow , make more money , and be more excellent , what contributed to getting you to where you are today ?
• Grit is a must . The highs are very high , and the lows are very low . There ’ s always some problem , and it ’ s on your desk . You ’ ve got to grit through that stuff .
• Sales & marketing . Businesses mature in stages . A good technical team can attract some customers and serve them well for a while , but if you ’ re going to get big , at some point , you ’ ve got to figure the sales and marketing thing out .
• Build a team . Where I see folks stall is when it comes to that moment when the owner can no longer be everything . To get past that level , you must figure out how to hire people and grow the business .
• Figure your mousetrap out , and then really figure out how to sell it .
What Are Your Thoughts About Fred Voccola And Kaseya ’ s Vision Of Bringing All The Tech Into One Platform ?
We ’ re a happy Kaseya shop . We ’ ve been with them since 1.0 — just an amazing outfit that they built . What Fred ’ s done speaks for itself . He has made a handful of very smart acquisitions . How many other CEOs can say that virtually all the acquisitions they ’ ve made have plugged in and worked ? He ’ s acquired these businesses the right way , too . Think about where Kaseya was before they brought Fred to the table and where the company is now . It ’ s the default RMM platform . As an MSP , the fewer clicks your technician has in a ticket , the more money you ’ re making and the better you ’ re serving your customer . So , to the extent that you ’ re an MSP that can have many of your core services consolidated around one engine , your techs are going to have fewer clicks and there are going to be more automation opportunities than if you have separate systems . All that is going to drive a better , more efficient outcome for your client and drop more to the bottom line for the business .
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