The MSP Zone

Ep 257: What do PE Firms Want from MSPs?

What do PE Firms Want from MSPs?
For the last several years MSPs have been courted by private equity firms desperate to enter the managed services space. At the risk of being obvious, what do private equity (PE) firms want from their MSP investments?
It's an important question and knowing the answer can help you successfully navigate the process of working with a PE.
PE vs other MSP buyers
Types of investment
Hold times
 
Managed Service Sales is Easier Than you Think
Stop overthinking sales. After reading a sales book (non-MSP) I'm convinced that the majority of MSPs have over complicated their approach to sales. Instead of focusing on native skills which all MSPs should have, they believe that it is necessary to acquire sales capabilities which are not native to most sales organizations and may be harmful to selling managed services.
Are closing and handling objections the real barriers to successful MSP sales?
The MSP sales magic bullet?
Lead generation and account handling
 
Help me fix my MSP pricing
MSPs struggle with pricing. Pricing questions come up many different sizes of MSP organizations (so it's not just an SMB issue). There are many reasons why MSPs might believe their pricing is either too high or too low. Following these simple methods should help you get a lot more comfort around how and where you price your managed services.
Pricing methods revisited
Prices are too high
Prices are too low
Pricing KPIs

Accounting Firms and MSPs, Master Cyber Providers, and MSP Pricing Reality Check

Are Accounting Firms Squeezing MSPs?
Misunderstanding MSPs in the larger IT channel discussion
Why are accounting firms getting into managed services?
How does the CPA community impact MSPs moving forward?
 
Could the Master Cyber Provider Model Backfire?
Those who ignore history are doomed to repeat it. Truer words were never spoken, particularly in the IT channel. Way back when managed services was just getting started, the master MSP model emerged. There are important lessons to be learned from this era, particularly when we start to see history repeating itself today. It's like déjà vu.
Role of the "master MSP" then
Today's "Master MSSP"
Resellers vs MSPs, it really does matter!
 
Manages Services Pricing Reality Check
There are a lot of methodologies for approaching managed services pricing. Regardless of what method you choose (and you should have a method), understanding the role of risk as a prime pricing determination factor is important. So, important, if you forget to include it you could be risking a lot more than just low margins.
Risk based pricing revisited
Understanding the role of margin in your pricing
Avoiding commodity price traps
 

Ep 255: Internal IT vs MSP; MSP Market is still growing; Does size matter in managed services?

Internal IT vs MSP
Can an MSP do everything an internal IT department can? That is the quintessential question the world has been asking for 30 years. Just because an organization has an internal IT department does not guarantee that it will be efficient. In fact, all IT departments face the same choices as IT service providers: you can be proactive or reactive.
Struggles of internal IT
Natural barriers of scalability with internal IT
Reactive vs proactive internal IT
 
MSP Market Still Growing
According to Allied Market Research , the MSP market is growing at a solid rate and will reach growth of more than 11%, with an estimated revenue of $594 billion globally by 2031. Now, this study focused entirely on enterprise class MSPs, but it still has some value for the rest of the MSP community.
If managed services is growing at the enterprise level, there is no reason to believe it is doing anything different at the mid-market and SMB levels
The drivers behind the growth are also applicable to all levels of the MSP market; factors such as adoption of cloud computing, keeping IT management costs in line, and increasing data security threats.
At these levels, managed services will represent half of all IT services spending around the world.
 
Does Size Matter in Managed Services?
I hear a lot of MSPs talk about what they would do if they only had more resources. While more resources can make a difference, it isn't the only thing that indicates success in managed services. In fact, there are many examples of large organizations who have very poorly run managed services operations.
Efficiency, not size is what matters
Resources only gets you as far as your process
It's all about execution

Ep 254 N-able CEO Advises MSPs on Upcoming Challenges; MDS vs MSP; Tightening Credit Markets Create Choices for MSP Channel

N-able CEO Advises MSPs on Upcoming Challenges
N-able held its partner conference in Prague recently and their CEO had some very interesting comments regarding the economy, compliance, security, and other "challenges" facing MSPs.
Headwinds for the rest of the economy are tailwinds for MSPs, if they position themselves correctly 
Major "business" shift for MSPs
This is a very simple adjustment for MSPs, if you don't look at it as a technical change
MDR vs MSP
Do you think managed detection and response is the same as managed services? Think again. Many people conflate these two practices but they are not necessarily the same; although they can be. Confused? Don't be.
Definition MDR
Defining MSP
Venn Diagram solution
Tightening Credit Markets Present Interesting Choice for MSP channel
As the US (and others) government attempts a soft landing from a red hot economy full of inflation and cheap currency, there are two solid choices for the IT/MSP channel. The choice your company takes will greatly depend on whether you are closer to an MSP or closer to a break/fix company.
IT lending
Product (project) refreshes
Using managed services to push through difficult economic periods

Ep 253: Can MSPs Guarantee Compliance; Converting Reactive Clients to Proactive; Should MSPs Get Involved with Customer Policies

Can MSPs "Guarantee" Compliance?
It's no secret that many MSPs are helping clients deal with compliance issues. Whether this is gathering evidence for a client audit, or simply offering traditional managed services to demonstrate compliance for a given framework.
 
However, when it comes to guarantees, compliance may not be the area where you make any guarantees. Here's why.
Compliance within the MSPs' control
Customer interference
Making guarantees in the first place
 
Benefits of Managed IT Services for Proactive Monitoring, Maintenance, and Support - Tech Guide
 
Converting Reactive Clients to Proactive
As some economists are predicting a 2023 Q4 recession, making sure your MSP ship is in excellent condition for potentially rough seas is a good thing. What could you be doing to better prepare your MSP practice for difficult times? Converting as many reactive customers to managed services would likely be a great starting point. Here's some advice on how to do just that!
First, why conversion to proactive is necessary
Migration strategiesCompliance
Security/privacy
It's the only choice!
Get creativeOffer incentives
Sunset your reactive practice
 
Should MSPs get Involved with Customer Policies
This topic was discussed at the last MSPAlliance Inspire meeting and the debate was interesting. What was unanimously agreed upon was there is a role for the MSP to play in compliance with their customers. What was in dispute was whether working on client policies was something an MSP ought to do.
MSP influence customer compliance all the time
MSPs compliance roles
Compliance can involve controls and policies, or both

Ep 252: Don’t Rely (too much) on Cyber Insurance; MSP Economics Update for Q2; Should MSPs Represent Themselves During M&A Deals?

Weaver Outrage Meter: Low
 
Don't Rely (too much) on Cyber Insurance
Barracuda surveyed 400 enterprise IT and security professionals globally, ranging from IT managers to CISOs, to discover the biggest cybersecurity challenges businesses face in 2023.
Are organizations placing too much emphasis on cyber insurance?
What should MSPs do about this?
Are cyber insurance policies being used to target ransomware victims?
 
MSP Economics Update for Q2
We just had the latest MSPAlliance Inspire meeting last week in Boston and it was a blast. A little chilly but the group went to a Red Sox game, had a great time, and also got a lot accomplished. One of the outcomes was an update of unanimous agreement regarding the economy and its impact on managed services operations.
Is the Q1 slow down still in effect?
What does Q2 have in store for MSPs?
What are MSPs doing to plan for the future?
 
Should MSPs Represent Themselves During M&A Deals?
We are in the middle of a curious period of MSP M&A. M&A deals seem to have slowed, and yet MSPs still report pestering from brokers and buyers trying to sign them up as clients. What can we make of this?
M&A demand is still strong amongst the MSP profession
Every MSP (buyer or seller) should have representation
Don't fall for traps that entice you to represent yourself

AI Ethics in Managed Services, Compliance Reporting, and Making Peace with Cyber Consultants

Weaver Outrage Meter: Low
 
AI Ethics in Managed Services
You heard correctly. Ethics in artificial intelligence. This is going to be a big issue moving forward and MSPs had better familiarize themselves with what is happening because before too long, MSPs will be dealing directly with AI devices and scenarios.
 
Compliance reporting
All the discussion around compliance lately is missing one crucial element: reporting. Without reporting, no compliance exercise you undertake will be of use to anyone outside your organization.
Compliance reporting
Balancing transparency with security
Lessons learned from FFIEC
 
Making Peace with Cyber Consultants
The old adage is "if you can't beat 'em, join 'em." Well, that's not exactly the issue here but it's close. Maybe a better way to put it is "if they can't beat you, they should join you." Cyber consultants are likely here to stay, which is not to say that we can't (or shouldn't) attempt to forge a pathway that is, if not together, at least on parallel tracks.
Cyber workers are like anyone else…they all start from the beginning
Cyber workers need to understand their own career path
Cyber workers need to understand MSPs and be respectful of the role they have

Cyber Consultants at it again; managing remote MSP workers; compliance isn’t security

Weaver Outrage Meter: Low
 
Cyber Consultants at it Again
We have been coming across a unique brand of marketing and website design company lately; yes, you guessed it, they also do cybersecurity. It seems difficult not to come across cyber security "experts" these days, even if that claim may be dubious.
Marketing gets into cybersecurity
Cyber consultants need understanding of MSPs
First do no harm!
 
Managing MSP remote workers (ticket reviews)
Since the pandemic remote work has exploded. The same is true within the managed services sector. MSPs, however, have some unique methods they can use to ensure their remote technical staff are actually being productive.
Unproductive remote workers
Lack of data
Ticket review benefits
 
Compliance isn't Security
With so much noise around compliance, I thought it might be nice to explore some fundamentals around compliance, what it is, and what it is not.
Security isn't compliance either
Being secure is its own goal and reward
Compliance is about communication and transparency

Ep 249 Q1 MSP report card; Cyber consultants continued; AI vs Automation

Weaver Outrage Meter: Low
We have officially wrapped up Q1 2023 and its time to evaluate how the managed services profession did  and what the outlook is like.
Q1 analysis
MSP outlook
Tech stock performance
S&P 500 doing well because of IT stocks
https://stocks.apple.com/A4qzi73EUTAqsG5chNLDjkw
Cyber Consultants Continued
We have been discussing (for years) the ongoing evolution and emergence of consultants in the cybersecurity field and the impact they are having on managed service providers (and their clients). We have an update on this topic from actual MSPs who are encountering these consultants in the field and the feedback may surprise you.
MSP interaction with cyber consultants (mature vs reactive MSPs)
Agenda of the cyber consultant movement
What can MSPs do?
AI vs Automation
MSPs need to evolve. Evolutionary change has been a constant in the managed services profession since its beginning in the early 1990s. As MSPs search for ways to become more efficient and scalable, an emerging debate is presenting itself as we understand more about artificial intelligence and automation tools.
AI vs automation
AI risks in managed services
MSP guidance for automation and AI technologies

Ep 248 - North Dakota mandates cyber education; MSP recession planning; CaaS dangers MSPs should avoid

Weaver Outrage Meter: Low
 
North Dakota Announces Mandatory Cybersecurity Education
 
North Dakota just announced a new educational mandate for grade school students to learn more about cybersecurity. Such a move is not only a smart one, but it is going to have a positive impact on future generations of cybersecurity professionals.
 
Cyber skills gap acknowledged
Good example of government leadership and action
Good news for MSPs (and other employers) in the near future
 
https://www-kxnet-com.cdn.ampproject.org/c/s/www.kxnet.com/news/state-news/north-dakota-is-first-state-to-approve-required-cybersecurity-education/amp/
 
MSP Recession Planning
 
More talk about a recession here in the United States; it seems inevitable that we are headed into, or may already be in a recession. What, if anything, can you do to prepare? Credit tightening will impact service providers, but more so on the reactive side. VARs, system integrators, break/fix companies, these are the types of IT business models most vulnerable to tight credit markets and will feel the financial pain more acutely compared to an MSP with steady, predictable recurring revenue and cash flow.
 
Historical impact of recessions on MSPs
Credit markets tightening, who will suffer most?
Can MSPs thrive during recessionary periods?
 
CaaS dangers MSPs should avoid
 
Compliance as a Service is getting more attention in the IT channel. With such attention, MSPs (and non-MSPs) are both jumping onto the CaaS bandwagon. But, just as with most things in life, there are right ways and wrong ways to go about developing a CaaS strategy and offering. Here are some helpful tips to get you pointed in the right direction.
 
Beware of reactive CaaS providers
Scanning is not compliance
If you've never been through an external organizational certification or audit, CaaS is probably going to be more challenging for you