Episode 07: PE and SASE for SMBs
Listen to the Podcast
Read the Transcript
Erick and Rich discuss alternatives to traditional private equity firms for MSPs seeking an exit and how to build a minimum required bundle of services for all your managed service clients. Then they’re joined by John Tippett, COO of Cytracom, for a look at the SMB market’s unique networking requirements and how SASE solutions can help address them. And finally, one last thing: two amusingly unlikely stories involving lottery winners from North Carolina.
Discussed in this episode:
Rich: [00:00:00] Ladies and gentlemen, welcome to another episode of the MSP Chat Podcast, your weekly visit with two talking heads talking with you about the services, strategies, and success tips you need. To make it big and manage services. I am Rich Freeman. I’m chief content officer at Channel Mastered, company responsible for this program.
I am joined this week as every week by your other cohost, Erick Simpson, my friend, my business partner also our chief strategist at Channel Mastered. Erick, how you doing?
Erick: I’m doing better than you, Rich, because I am back home trying to get rested from just coming. From IT Nation Connect with you, but you are off to another event right now.
So you haven’t touched, you haven’t touched home base for how many weeks now, Rich? You’ve been on a whirlwind tour.
Rich: I’ll correct you in two quick ways. So I left home for this road trip essentially on October 29th. But I was home for two days. I was home for the weekend. We’re recording this on a Monday, folks.
And also you said I’m in on the road again for an event, I’m actually on the road again for two events this week. Yeah, I’m on a stretch here, and it’s probably the closing road trip stretch of the year, but I’m on a three week stretch during which I’m attending five events. And this is event number
pEople say, folks are road warriors. You’re like a road general, Rich, I don’t I don’t relish that nomadic existence that you pull off so well. I couldn’t do it myself, but but here we are ready for another awesome episode of the MSP chat podcast.
Rich: Indeed, and we’ve got an awesome interview segment coming up with our channel mastered colleague Lisa Shore. Who is going to be talking about a topic that she honestly, and I can say this honestly, knows better than anybody else in the channel, anyone else in the world arguably. She is an image consultant for MSP.
She helps them burnish their corporate image, but also their personal image and that of their employees. So we’ll get into that with her in a little bit. And trust me, folks, this is a subject that too few MSPs think about that you should definitely be thinking about for competitive reasons. But Erick, let’s dive into our top story of the week.
And it’s an interesting one for a couple of different reasons here. Just a few weeks back Kaseya issued a press release in which they announced three different things. I’m going to focus in on item number two on that list, because they announced in that press release, in passing, item number two, The introduction of what they’re calling Kaseya Helpdesk Services, which is a white label, outsourced helpdesk service that their partners can tap into right now.
A very timely offering, Erick, right? We know how competitive the labor market is for technicians right now. It’s been that way for a long time. All the research I’m looking at says that’s not going to change anytime soon. Here’s a way to pay Kaseya what they say is a very competitive price and, with long term commitments, competitive pricing is part of their DNA over there.
You can get this whole hiring and retention issue off your plate. Get rid of that headache. Outsource a lot of your particularly level one Helpdesk to Kaseya. If you’ve got level one techs today, you can either politely invite them to find employment else elsewhere. It’s certainly a favorable market for them.
And that brings down your expenses enormously and increases your profitability. Or you can put them to work on more profitable strategic kind of endeavors. That helps the bottom line out too. So a very interesting service. ConnectWise, obviously, via their continuum acquisition, has been doing something like this.
They’ve got a knock that they’ve had for a long time, but interesting to see Kaseya get into this. Particularly because, Erick, and I won’t spend a lot of time on this because this is speculative, But when we were both at DattoCon, I had an opportunity to interview Fred Vokola, CEO of Kaseya. And at the very end of this interview I did with him, as I’m literally packing up my computer and stuff and getting ready to leave, he tells me, Oh, by the way, Rich, in April at our next conference, we’re going to announce the biggest thing ever to happen in the managed services industry.
And I’m like, now you tell me this, Fred what is it like, give me a hint. He barely gave me a hint, and I won’t go into the details, but the hint that he gave me, the one hint that he gave me, had me thinking I’ll bet you they’re going to introduce some sort of help desk service, and they’re more or less going to give it away.
If you make a big multi year commitment to a big stack of their products, they’ll [00:05:00] just do level one for you. And then lo and behold a few weeks later, here comes Kaseya help desk services. I have a hunch. I may have been onto something here.
Erick: Curious. So interesting, but not unexpected.
I’m thinking, scratching my head going, when are they going to make this move? When are they, because as you mentioned, Rich. The tech shortage, the cost of replacing technicians and engineers that are poached is just so high and hiring and retention is tough. I like the idea of Kaseya.
Offering this service. And by the way, Rich, where are these technicians and engineers located?
Rich: So they are located in, essentially local markets. They have them scattered about the the globe. But if you are in North AmEricka purchasing the service, then they are, English speaking, North AmErickan based white label help desk employees,
Erick: which is valuable.
That’s a value add, a unique value proposition. Compared to some of the alternatives out there. So I really picked up on that and yes, it, if we’ve got technicians and engineers, if I’m the MSP, I probably am not going to release them back to industry. I’m just going to see this as an opportunity to have the noise of the level one tickets being handled by the sales services.
And then I’m going to put my team to work on more profitable, more valuable services to our clients. So they need cyber security training, they need cloud migration training, all the training that they need end user security awareness training. How do we reposition our valuable staff that has been with us, that it’s obviously a cultural fit or else they wouldn’t be with us.
As long as they are rich and put them to work and get them trained to deliver more meaningful, more sticky services, more strategic services to our clients, thereby increasing our rates for those services and covering the cost of potentially these lower cost level one help desk services from Kaseya.
So I say, bravo let’s move into the next evolution version X dot. X of managed services by outsourcing something that I’ve always promoted, rich outsourcing more of these noisy services that don’t require. specific expertise and strategy so that we can offer those at a very high value and commensurate rates to our clients.
Rich: And, I’ve been writing quite a bit in recent weeks on my blog channel Holic about this, the key to avoiding commoditization and keeping your profitability up is to get into that strategy space that you were alluding to Erick. And yeah, absolutely. To the extent that you can really.
Build the entire team at your organization around business consulting, business planning solution design development and execution. That’s going to be really. Smart and helpful for your business longterm. And it’s a nice segue into your tip of the week, actually, because you’ve got the keyword solution in there, Erick.
So what is your tip of the week?
Erick: Rich, it’s all about dusting off your client solution roadmap. Now the client solution roadmap is a tool that we built in my MSP. Now we transitioned. Our professional services and time and materials based technology firm that we started in 1997 into one of the first MSPs in the channel around 2004 ish, 2005 ish.
And we developed, once we figured out the value proposition and how to position flat rate, it services, what we called it then rich. So it wasn’t very, sexy or anything like that. It wasn’t managed services yet. Fly rate I. T. Services that came with these components, remote monitoring and management service desk and some additional services that we threw in there.
It was basically vendor management. So we pioneered things that Today, people take for granted, Oh, vendor management. We know what that is. Nobody knew what vendor management was back then. And that was the third leg of the stool that we put together with our managed service offering, monitoring patch management and user service desk, and then, vendor management, and then we did projects on top of that.
We loved the recurring revenue model so much rich that we started finding opportunities to. Deliver third party white labeled services to our clients. And some of them didn’t even need to be white label. They could be billed directly from that vendor. But the idea was that we would find all of these other needs within our clients, businesses that we already have that trusted advisor relationship with, and we could introduce these third party.
Strategic vendors or white label them under us. But the point [00:10:00] was, is they needed everything from, VoIP to DNS, to wireless, to all, just think of everything, copier printer. We had accounting firms. We had all these different services that kind of extend way beyond what an IT practice, thought to be able to deliver back in the early 2000s, let’s say, and we were really pushing the envelope there.
So what we figured out was. Clients need all these services. We’re going to focus on the core ones that we deliver best and make the most margin on, and then we’re going to create strategic alliance relationships with vendors that deliver all these other services. And so we built out this tool.
It was basically a glorified Excel spreadsheet. We call it the client solution roadmap rich, where we would list all of our clients down the left column, across the top, we had all of the products, services, and solutions that we thought our clients would ever need based on them telling us these things.
And then we would find vendors to fill those gaps. And we were looking for vendors that offered a recurring revenue type of commission or revenue stream to us to do that. So think of today and think of the specialization that MSPs are focusing on more cybersecurity, more cloud, right? And they’re getting away from maybe they’re focusing so much on these services, but they also have other services that they do deliver.
And I’m not suggesting that everybody do what we did is think of everything that the client needs, but you certainly have services that you deliver that not every single one of your clients are buying from you. So create your client solution roadmap of all every single product, service or solution that you want your clients to consume.
And then the other name for this tool, which was the red dot green dot spreadsheet, because if a client had that solution, they’d get a green shaded cell. If they didn’t, it was a red shaded cell. And then there was some calculations on, and you can get it on my MSP mastered website. If you really want one that it’s all built with.
Put your pricing in per user pricing, one time pricing, everything like that. And then you can forecast out how much money you’re leaving on the table. And so it was an amazing tool that we just came up and it was very successful. And then what it allows you to do when you start doing something like that rich is to say What’s the next lowest hanging fruit?
Product service or solution that we can sell to the majority of our clients that don’t have it. We would train our sales team up on it. We train our technicians and engineers, how to deploy it. And we would go market it and sell it, boom, to all the clients. And then we go to the next thing and then do that over and over to the point where rich, we had about 40 percent of our recurring revenues coming from services that were fulfilled, someone other than ourselves, think about the power of that.
So that’s the client solution roadmap. And I suggest everybody think about that. I know a lot of MSPs are. Are probably doing something like that, but boy if you’re not, this is probably a tip that could find you, who knows, an extra 40 percent more MRR.
Rich: And I will simply point out that every vendor, every distributor I know, every sales and marketing expert in the world will tell you, Cross selling to existing clients is much easier and cheaper than landing net new clients.
So you should be doing both obviously. But if you are not making a priority of cross selling, that’s a mistake. And the roadmap and that sort of systematized approach to, to mapping that out and tracking that, and then working your way down the list are very good solid organized way. To make sure that as he said, you’re not leaving money on the table.
I like it.
Erick: It creates a tremendous amount of stickiness. Think about it.
Rich: You know what it is time now for us, we’re going to take a quick break and then when we come back on the other side, we’re going to be joined by our channel mastered colleague, Lisa Shore who is going to talk all about business image management, personal image management for MSPs.
If it sounds like a squishy topic, doesn’t sound like something that’s relevant to you trust me. By the time you’ve come to the end of this interview, you will have changed your mind about that for reasons you’re about to learn. So we’re going to take a break. When we’re right back, we’ll be joined by Lisa Shore.
And welcome back to MSP Chat for our spotlight interview segment this week. And we are joined by Lisa Shore. Lisa wears many hats. She is our chief brand strategist at Channel Mastered. She is the owner of a brand and image management consultancy for MSPs called Shore Success. And she’s also co owner with her husband, Erick, of an MSP in the New England area called Secure Future.
tech solutions. Lisa, welcome to the show.
Lisa: I’m tired. Just thinking about me. Thank you for having me.
Rich: Our pleasure. Completely our pleasure. I was thinking to myself [00:15:00] just a little bit earlier today. How long have we known each other? I’m pretty sure we met in 2017. Does that sound
Lisa: about right?
I think that’s when I that’s when my first articles showed up at when I started writing for Channel Pro was 2017, so I think so, somewhere 26, probably 2016, and then we really started hanging out more 2017.
Rich: It also occurs to me it’s a little surprising that you agreed to come on this podcast because you were the victim of the most notorious fail in the history of Channel Pro Weekly, the podcast I used to Whitlock you know exactly what I’m talking about we had Lisa on the show.
For the first time, she was, she’s been on that show several times, but we had her on a show to talk about brand and image management for MSPs. It was about a half an hour conversation. We hung up. Matt and I said to each other, man, that was good. And then Matt realized he hadn’t recorded it. He didn’t hit record.
Lisa: I just saw Matt last week and he shared the same story.
Rich: Yeah. Yes. The two of us are still, yeah. I want to spend most of our time today focusing on a series of blog posts you’re writing for the Channel Mastered website. But before we do that, I, one of the reasons why I was so happy to have you write for Channel Pro when I was Executive Editor.
There and come on that podcast was because I really feel you convinced me that brand and image management for MSPs is a super important topic that doesn’t get discussed enough. So just give folks, the MSPs in our audience, a quick synopsis for what that’s about and why they should care about it.
Lisa: So image and branding directly relates to solidifying client relationships, which then results in profits for your MSP. So it’s really, or for your vendor. So if you’re a vendor, whichever direction, so it’s really important that if you have someone, we all have the same tech stacks, a lot of products that we offer are similar.
So what sets us apart? What is it that makes the client want to stay with you? Want to engage with you and that’s the human side of it. That’s how we appear It’s how we communicate. It’s how we connect with others and that’s that relationship that really matters And so that’s why and so and we had my MSP had some struggles and so and we weren’t paying attention and we were losing clients and really upsetting people and so because of that Sure.
Success evolved and is what it is
Rich: today. It it, it is a really interesting and neglected topic. And I would just encourage people to go to sure success. com S H O R success. One word. com learn more about it, get in touch with Lisa. But let’s talk a little bit before we get into those blog posts tell folks a little bit about your role as chief brand strategist at channel master.
Lisa: am here to look at all of the little details that we, how we present ourselves here at Channel Mastered. Whether it’s how we show up at trade shows, what we wear. I intentionally dressed for this today. Even though I’m not sure we’ll be on video, but I still have a red jacket on because that’s our branded colors.
Also, thinking about how we’re communicating, how our voice sounds, how our posture looks, the, any kind of communication we send out, is it the same story? Is it in line with the, Who we are, how we want to support vendors and really looking at the full
Erick: picture. And, that’s that’s one of the reasons, Elisa, that we love working with you at channel master, because you bring a dynamic, a perspective that a lot of people don’t even think about.
And you’ve started documenting some of these best practices and strategies. In a series of blog posts, the seven part series that you’re writing for channel mastered about what vendors need to do to earn the trust of MSP partners. So shining the perspective on, vendors and what they should be doing in order to earn the trust of MSP partners.
And, when we’re working with vendors at channel mastered. I never thought about the things that you’re describing in these blog posts. When I say, we need to earn the trust of the MSP partners, I’m thinking channel program stuff and benefits and MDF and making it easy to work with and training and all these things.
But this component can actually improve that trust, align the trust much more quickly, build stronger loyalty, even [00:20:00] when I would argue. That some of the other components still need to be worked on in the channel program itself. Would you agree with that? And why is building that trust such an important consideration other than the obvious in your mind?
Lisa: So I have two responses to that. One, a confused buyer never buys. And if somebody is confused about how you look and is that going to be wait a minute. If they’re allowing their team to appear or sound. abrupt, annoyed, then what about the service I’m going to be receiving? What about the support I’m going to be?
It all relates. And then we all buy, speaking from the perspective of an MSP owner, We buy based on feeling and do we feel that this company, this vendor that I’m going to be aligning with is the right vendor for me because they are going to secure me, they are going to provide me really great supportive support, not just support, but when my engineers get on the call, I have to, when we sign on with a vendor, we’re not just signing on because just because of the product, we sign on thinking about it.
My client res, my client solution, but how are my engineers going to do working with this solution? How are they going to feel? Inevitably, once the sale is made or once we sign on with a vendor, it goes over to my support team. I, my, and my, if my service team is upset. Because your support staff are angry, they’re grumpy, they’re whatever, or they’re just not getting back, they’re not following through, they’re not setting expectations, that’s a problem.
And that makes a difference. There’s a lot of vendors who are alike. And so how do you set yourself apart? It’s really critical.
Erick: Yeah. You made some really important points there Lisa. Yes. Human beings buy based on emotion, right? Justify that purchase, with logic afterwards. The other point that I think about when I’m listening to you describe this dynamic is nobody really knows how well we actually deliver services for our clients.
Until they sign up. So all they’ve got to go on to make that buying is the sales, the marketing process, the sales process, and that, that interaction that they have with different members of the team, pre sales, so that makes a very compelling point in, Hey, if we’re, if we’ve got all these other things that we’re looking at, we should look at.
The brand, the image, and you mentioned a couple of things, how we speak, how we communicate. I know you and I had conversations, Lisa, where you even get down into, the inflection of, and the cadence and our tone and how we, raise our voice and lower our voice and speed up and slow down to, to engage better with our audience, which I think is really happening.
Now, the first post in your series for Channel Mastered lays out six things that vendors need to do to earn this trust with their MSP partners, and they correspond with the acronym VENDOR. V E N D O R. That’s right. And it’s a super interesting read. Give us a brief overview of that post and what those six.
Items mean the
Lisa: acronym. So I wrote the post from the perspective of being an MSP owner and what do I look for in a vendor? So what is it that I? When we’re selecting a vendor, it goes through a very critical vetting process. It’s not just, Oh, I have to go with that vendor because everybody talks about them.
Yes. I will go look at that vendor, but we then test them out. We try, we really always do a demo in our office. And I. I put my support team, my service team to the test to say, Hey, does it work? Is it easy to deploy? Tell me about the support you receive. What’s your experience? So I wrote a my article is about the things that I look for.
And so the vendor is my acronym, my brain works in acronyms. And so V is for visuals. And that’s, there’s two sides to the visuals. It’s the corporate branding. Is it clear? Do we understand? Can we pronounce their name? Can we understand what they’re, the coloring, the, like the whole process of it.
And then the personal branding. When I meet you at a train show, do I like your person? Do you like your salesperson? Are they approachable? Are they friendly? Are they knowledgeable about the product and [00:25:00] service you offer? E is emotional intelligence. And this is where a lot of sales can happen or go south.
Emotional intelligence is our ability to build relationships. It’s our ability to first understand how we’re feeling and then respond based on what needs to happen in that conversation. So we might be feeling inside frustrated or not understanding something. But we want that sales rep to make us feel secure, make us feel, don’t worry, you’re in good hands.
I’ve got you. I get it. And so there’s an inter, a kind of communication, but we have to think, how do I feeling, but also how do I need to respond? So we’re in a mutual conversation here of comfort and support. N is nonverbal communication, that’s critical to, that’s not just what we wear, which is part of it, but also our posture.
And how do we look confident? Do we hunch our shoulders and look down and hide our eyes and give her a very weak handshake? What all of that matters, all of that is preparation to building trust and credibility. D is what we, you just talked about in dynamic dialogue. And that’s how we say it.
That’s what we say. Of course, we certainly don’t want to use. No confidence words like hopefully we can solve your problem or I don’t know just like that I don’t know and then you leave it like that So that’s a combination of I don’t really care in your voice in your tone, but also a finite answer saying If I’m already telling you I don’t know now when I get to be with your support team.
Are they gonna tell me the same? All of this perception starts to build in the brain. And so it’s really critical that we establish all of this from the get go. O is open communication. Do we feel that you’re communicating with us when there’s a problem? When there’s an upgrade? When there’s an outage?
Or, if you’re working on our service ticket that we put in for you, are you letting us know? Are you setting expectations? Is there open dialogue? An R is reliability. Are you reliable? Are you going to be there when we need you? That’s critical because your product is a direct result of my client’s success.
Are we a team? We need to be a team. So we need to consider all of these factors.
Rich: The, your first blog post in the series spelled out that, that acronym and gave people a quick introduction to what each letter stands for. And the subsequent posts are gonna dive in to each of those letters one by one.
. And most of those are still to come, but you recently published the the deep dive on V for vent V for visuals. Excuse me. First letter in the acronym there. You said earlier in the conversation, a confused buyer doesn’t buy, and that’s a point you emphasized in that blog post there.
Talk a little bit about the relationship between appearance and visuals, personal and corporate brand and buyer confusion.
Lisa: So let’s start first with the corporate side, because this is where most people and almost every single vendor considers this. They all consider, okay, let me come up with a company name, let me come up with a logo, let’s put some colors to it.
So we want to make sure, so that, and that’s usually where the marketing stops. So they start there, they’ll come up with a great logo and then we’re going to use it. Great. But do people understand it? Can you articulate what it means? And right there from the get go, sometimes logos or company names. It might be antiquated, they might not be clear or maybe ability to pronounce.
So starting right there is just thinking about what your company name is and what does it stand for and making sure that you tell that story, making sure that as a vendor, the buyer, the MSP owner understands what you stand for. And that means that your invoices, your website, you all the different, your LinkedIn profiles.
All need to be consistent. I have three C’s in image and that’s consistency, congruency, leads to credibility. Consistency is showing that logo, showing those colors, showing your tagline, your core values needs to be consistent everywhere you go. Credibility, congruency is telling that one story. And if you’re saying [00:30:00] that you’re this type of a vendor, you’re a security vendor for backups.
Great. And then you start telling stories about other avenues that you’re looking into and if someone’s not clear on what you do or who you do it for, then credibility could be lost. But if you are able to articulate you as the owner of your, of the, of the spender and then all of your staff, all of your team need to be on the same page sharing that message.
And when it’s clear, that’s when credibility happens. So that’s on the corporate side. On the personal side, that’s not as easy, and that’s something that’s often, we would rather, I get it, all of us in the IT world want tangibles, and we want to stay in our lane or behind the monitor, I totally get it, but what sets you apart from that sea of sameness, and that’s the personal side, the personal branding side, and everybody in the company Needs to view themselves as a leader.
Everybody’s a leader because everybody touches the client, the MSP in a different way, whether it’s through service support, whether it’s through sales and account management, invoicing, whatever it is, wherever it is, especially trade show management, whatever it is, we need to have humans who consider how to build the brand.
Number one is, being in uniform. grooming, thinking about, we’re all on keyboards. I put in my article, we’re all on keyboards. And I remember someone telling me at a trade show years ago that the engineer, this is on the MSP side, but their engineer had dirty nails and it grossed them out.
And I’m like, Ooh, think I, so I casually look at, the, and the nails of my team and different people. And I’m like, just making sure, but thinking about those things, all of those details really make a difference. And send messages and people, we listen with our eyes. There’s a statement that says we listen with our eyes, and if we don’t start thinking about how we’re presenting ourselves, what we’re saying, and what messages we’re sending.
Physically and verbally, that really plants seeds and perception seeds. It doesn’t mean that it’s right or, really wrong, but it’s perception. And it’s other people’s perception that we’re working with. And we’re all different people. And so we have to work a little bit harder to make sure our message stands out.
To make sure that when we deliver the messages, we’re building relationships. tHat are authentic, but also consistent, congruent, incredible with the brand that we’ve created. And with our mission statement, all of it. Whenever you see me, sure, success anywhere, I’ll always be alignment with my brand.
Everything I talk about is always going to be, how do we become better communicators? How do we become empathetic toward each other, understanding we all have clients breathing down our neck? We all have tech issues. We all have those. How do we communicate that and communicate together in an empathetic way?
Thinking about, okay, let me show you in my face that I care. Let me show you in my eye contact. Let me show you in my voice. And notice I have dropped my voice, I’ve dropped my tone just a little bit to show how serious this is and how passionate I am about being strong communicators in our industry. So critical.
Erick: Wow, Lisa, you’ve done a really great job of identifying, some of the tips around, corporate image assessment, personal brand, corporate brand. so You’ve already given us some really good things to think about there. So I’m going to throw you a little bit of a curveball. I’m going to ask you because, I think one of the, one of the first in, the most important interactions that a vendor will have with an MSP prospect is that first call with their internal sales team or demo person or things like that.
So let’s say that, I’m the MSP. Former MSB and I’m engaging now with you, my vendor prospecting. I’m looking for a solution and I’ve gotten past the, you’ve done a good job of the corporate branding. I get it. I feel comfortable. Everything is congruent. Everything is consistent. Now it leads me to Book a call with you.
Can you share some of the do’s and don’ts? . For an internal salesperson at a vendor, as you and I are communicating in that very first call, [00:35:00]
Lisa: my number one do is to have a process. Have a process of a series of questions to ask so that you can qualify and you can learn more about that. MSP, how are you gonna use my solution?
Tell me about your client base. Tell me about your engineer team. What is their level of knowledge? What is their level? Tell me about any and also use a voice that sounds excited that sounds intrigued interested curious Willing to help too often. I hear voices that are monotone. Okay, tell me about so you wanna how many licenses do you need?
What can I do for you? And they leave it there, but there’s so much opportunity. Number two big advice is to research who is buying your product before you get on the call. Find something out about them. Too often, it’s just a base conversation of a trans, it’s more transactional. I feel like our industry is really critical.
The vendors that are most successful are because they have relationships. with MSPs. Those are the ones that are most, they make an effort to really learn what our pain points are, to really learn, but they also learn who am I as a person, because once we feel connected with somebody, then that sets us over the edge.
That really makes a difference to building credibility and trust. And not enough people do research ahead of time. I’ve gotten on vendor calls and they don’t even, they weren’t even prepped ahead of time of who we are, what our company is, what we do, who our niche or verticals are, none of it. And so it’s really critical we do the research.
We have some qualifying questions in place and have it as a document. Could be an online document, it could be something physical in front of you. My IT company, I keep it in front of me all the time. We have a whole series of questions, of qualifying questions that we use to make sure. A vendor, you could have the same.
You should absolutely do the same. And I’m really thinking about that. Some of the don’ts, I think there are more do’s than don’ts. I think I would rather focus on those. But, just thinking, being mindful of some of the conversations that you shouldn’t have. When you’re first meeting with someone, it’s not appropriate to Talk about politics and religion and all of that.
So of course that’s critical, but really it’s important to get to know the person. Some of their, you can find so much information, go on their LinkedIn profile, see if they volunteer for an organization, see what their last posts were, what’s important to them and really establish from the get go that relationship.
Erick: Yeah, those are really key insights, Lisa. And I know when we do training for internal sales teams. At channel mastered for our vendor clients, we also have, what I call the the bad words list, right? When you’re having a conversation when you’re having a sales conversation, you should replace, this is the replacement words reference is probably a better way to put it.
Lisa: for action plan,
Erick: Price, no investment, contract agreement, right? A contract just seems so, Hey, the agreement is something we work toward, right? Problem versus challenge. I hear you have some challenges in your MSP that we’d like to help you overcome, right?
So there’s a lot of that conversational, I’d say conversational intelligence, right? It’s emotional intelligence, or conversational intelligence. Yeah, maybe I’ve added a new letter to the acronym there
Lisa: for you. I’m writing that down. I actually, I really like that.
Erick: And the key things that you mentioned, having excitement, not acting like you’re just going off of a checklist, being an order taker.
Nobody likes that, right? No. That engagement, that excitement, That gives the MSP that feeling that, oh, you really are excited to talk to me and to earn my business. It makes all the difference in the world. So
Lisa: true. So true. And I want to add in, I love that, conversational intelligence. I also want to add in email.
A quick word about email, because honestly it’s easily misconstrued. And adding in a couple of extra steps, I know we’re all pressed for time. I totally get it. But if we really want to develop relationships and set ourselves apart, these extra few steps really matter and using dear, first of all, dear Erick, dear Rich, I really enjoyed our conversation today.
Thank you so much for inviting me. I have a couple of followup questions and then putting things in bullet points will help to digest. And then, it was great to see you today, sincerely, our warm [00:40:00] regards, Lisa. Having that structure of a little bit of kindness. A little bit of formality, yes, I know we’re casual in this industry, but that doesn’t mean our email has to be as casual, and it’s so easily misconstrued, so I highly encourage people to consider as you’re building relationships, but not only that, it’s consistently retaining those relationships.
It’s a lot of work to have to switch, to off board an MSP or, it’s a lot of work all around setting everything up. So let’s, think about longevity here and we want referrals. We want raving fans and brand loyalty. And so all these little details
Rich: matter. It’s interesting because a lot of this conversation has been vendor oriented.
But pretty much everything you’ve spoken about with us today, Lisa, applies every bit as much to MSPs, right? Have a process for handling that first call with a potential client. Research them a little bit before that conversation, et cetera. So thank you so much for joining us Lisa.
I’ll just tell folks in the audience. If you are a vendor, she has way more wisdom than you just heard in the last however many minutes. If you want to tap into that a little bit and you’re a vendor Channel Master can help you out with that. If you are an MSP and you want to take advantage of of Lisa’s expertise in this area, I’m sure Success is the place to go.
And again, that is Sure. Success. com. Lisa, how else can people learn more about you? Get in touch. You
Lisa: can find me on LinkedIn, but the best place is to go to my website and right on the homepage, the top one third of my page is a link to my calendar. And so click on that calendar link, book a meeting with me.
I would love to, whichever side you’re on, whether it’s the vendor or the MSP side, let’s have a conversation of relationship building and trust. And why do clients really hire us? Why do they hire us? And what’s the differentiator? I’m happy to help.
Rich: I encourage folks again to follow up with Lisa. Thank you Again, Lisa always a pleasure folks we are going to take a break here when we come back on the other side Erick and I are going to wrap up the show Maybe have a laugh or two and send you on back to the rest of your day.
Stick around. We’ll be right back Thank
Rich: And welcome back to Part 3, the final part of this week’s episode of the MSP Chat Podcast. Erick, I get a little nostalgic actually, when having a conversation like that with Lisa, because it takes me back. About five, six years ago when I was at Channel Pro magazine and Lisa reached out to me and told me what she did, and I just knew immediately this is something nobody else is doing that everyone who reads Channel Pro needs and she, she contributed all sorts of blogs and did lots of event appearances for us in the years after that.
Yeah. Because it’s just really such an important service and such a unique one, no, nobody else is doing this.
Erick: And Rich, not for nothing, the majority of the MSP business owners that I’ve worked with are pretty, technically minded folks, engineer minded folks.
And sometimes, and I count myself among those, I’m an engineer by trade in the enterprise before, coming into the. They, the exciting world of, building your own it practice and running a managed service business. But we don’t think about those soft skills. We don’t think about the, the way that everything that your company does to, to market, to sell, to deliver service, even the way we dress our mannerisms, our body language, the way we inflection in our voice and raise our voice, lower our voice and things like that, all of that creates this.
impression that can create distinction and value in your client relationships. It’s amazing. Once you really appreciate, what the real impact of that is and what many of us are missing. By not being exposed to that side of, human behavior and perception and things like that.
And you’re right, Rich. I’ve had the pleasure of traveling a lot with Lisa at events, after she’s joined us on the channel master team and just watching how excited people get when she explains this. And it’s this epiphany, this light goes off in their head and they get really excited and want to engage with her.
For her services. And yes, I’ve not seen anyone else even speak about this in the channel. Not only is she amazing at what she does, but she’s pretty much got the market cornered because no one else is bringing this. This knowledge to MSPs that I know of.
Rich: Yeah. And yeah.
You can work [00:45:00] directly or reach out directly to Lisa at Shore Success, S-H-O-R-R. Success one word.com. But it’s worth noting that she’s part of the channel master team. Channel master works with vendors who work with MSPs and she’s part of the channel master team because vendors understand, they, they want their MSP partners to be as prepared for success and as successful as possible.
And once they’re introduced to Lisa and what she does, they understand the value of offering this service to their partners. In addition, she also works directly with the vendors on burnishing their image and making sure. They’re presenting themselves in the best possible way when they’re reaching out to MSPs.
Yeah loved having Lisa on the show. We’re gonna have lots of Channel Master Advisors on this podcast on a rotating basis. So she will be back and we’ll get into some more specific aspect of what she does with her down the road. She’s In the process, actually, of writing a seven part blog series on that for us.
Plenty more to talk about with Lisa. That leaves us with time, though, Erick, for just one last thing. And it comes to us from China. This is one of those Guinness World Book of Record one last things, Erick. Always a reliable source of those items for podcasts like this one. Turns out that a Chinese food company has broken the world record for the largest cup of instant rice noodles by cooking up 112 pounds of instant lucifen.
Now, I am probably mispronouncing lucifen. But they, this company in China has cooked up 112 pounds of it in a 4. 3 foot tall container. And I’ll just read directly here from the news story that called this record of my attention quote, the soup, which also contains vinegar, chili oil, peanuts, dried tofu skin, and bean curd sticks gets its famous fecal like odor from the sour bamboo shoots spread on the top.
I’m just gonna say, I’m gonna go out in a limb a little bit here Erick, and say, I don’t need. A cup of fecal like odor Chinese noodle soup. I certainly am not interested in the sound of 112 pounds of it in a 4. 3 foot tall container. So congratulations for breaking the record. I don’t know if that’s something.
I’m glad I didn’t have to experience that one myself in
Erick: person. Yeah, I’m certain, Rich, that they don’t promote that, aspect of the dining experience of these fine noodle dishes. Very heavily. Yeah, not not a good not a good experience when you’re dining too.
Part of that experience is out of the smells and the aromas and the aftertaste and all that. Good on them for getting the world record of the probably worst smelling largest cup of soup ever made.
Rich: Good on them. Good on them, absolutely. And I’m glad it’s on the other side of the planet. Folks, that is all the time we have this week.
Thank you so much for joining us. We’re gonna be back again next week with another episode for you. Until then you can check out the video version of MSP chat on YouTube. The audio only version is available wherever finer podcasts are distributed. From Spotify to Apple, Google, you name it, Amazon Music.
You’re gonna find us there. And when you do. Please subscribe, rate, review, share with your friends. It’s going to help more people discover the show help help make the show a little bit easier for people like you to find. Produced around the program is the great Russ Johns. Thank you for all you do, Russ.
You can learn more about him at www. russjohns. com. Russ is also part of. The Channel Master team, along with Erick and Lisa and myself, if you wanna learn more about Channel Master, you can check us out at www.channel master.com. And hey, if you wanna check out my blog, which I referenced earlier in the show here, it’s called Channel Hawk and you’ll find [email protected].
So once again, folks thank you so much for joining us. We’ll see you again next week with another episode. Until then, please. Remember, you can’t spell channel without M S P.
@Rich: [00:00:00] Three, two, one and blast off, welcome ladies and gentlemen to another episode of the MSP chat podcast, your weekly visit with two talking heads, talking with you about the strategy services and success tips you need to make it big and manage services. I am Rich Freeman. I am chief content officer at Channel Mastered company podcast.
I am joined this week as I am every week by your other cohost, my friend, my business partner, our chief strategist at Channel Mastered. Erick Simpson, Erick, how are you?
I’m doing well, rich just in between shows. So DattoCon on the way to IT Nation Connect as we record this broadcast. Closing out the year.
@Erick: I know you’ve got more travel coming up beyond that, but I’m glad to think that I’m not doing only, I’m only doing one more travel stint. And I should be home based through the holidays.
@Rich: Which sounds nice. And I go through this every year, by the way. So this is one of those very, very busy times of year on the event calendar, which is why, we’re both traveling a lot this time of year.
And we’ve been traveling a lot. All year long. And so here we are at the end of that and the holidays loom in the distance. We can stay at home, enjoy friends, family, et cetera. And every year I look forward to that and I’m ready for that. And then January, oh, I dunno, third rolls around and it’s like, when can I get back out on the road?
But but first I get to spend some time at home and I’m looking forward to that. Just like you are Erick. Let’s dive into our top story of the week here. And this was inspired by a story I wrote for Channelholic, my blog recently. And the reason I wanted to bring it up here Erick, is shortly after that article appeared, I was talking with our Channelmaster colleague and partner, Mark Kral.
And like you, he is a recovering MSP, he was an MSP a long time ago in the early days of the model as we know it now, sold his business a long time ago, he said he read this piece that I had written and thought, man I should maybe start another MSP again because, you’ve got me thinking it’s a whole different world out there, and so what was it that got his attention like that?
Back in the day, he, When he and when you were out in the business you went out and you launched a managed services practice, you did your best to build it up when you were ready for to cash in on all of that hard work you did really the only options that you had were to sell to a larger MSP or maybe, and this is more true now than it was 20 years ago, but maybe you sell to, One of the private equity firms out there that is so interested in buying and rolling up MSPs right now.
But in the classic model, either way, what happens is you collect a check, there might be an earn out period when you’re sticking around for a little while, but you’re moving on and finding something else to do. A lot of people want that. That’s what they’re looking for. But I have been coming across more and more of these companies that are acquiring MSPs.
In a buy and hold kind of model and so one of them that is going to be speaking at the IT Nation Connect event coming up soon is called Evergreen Services Group. I wrote about them earlier this year on Channelholic. Craig Fulton, well known from ConnectWise is now Part of the evergreen team.
And they don’t, they’re not looking to buy, roll up and flip. They look for companies that they think are well run. They invest in those companies and they are looking for owners who want to stick around. And grow with the company with help from evergreen with help from the other MSP owners in the evergreen portfolio and build something together.
And that is very much true of this company that I wrote about recently for channel Hollywood called workland partners. And what’s especially interesting about workland, what got my attention is most of the acquiring companies out there looking for MSPs right now. Are looking for larger ones. And what I keep hearing from the experts is a million dollars a year of EBITDA or better is what everybody wants right now.
And they’ve got a very different thesis. At Workland, they’re looking for much, much smaller companies good companies, run companies with, sticky customer relationships and so on. But it is very much the buy and hold model and the model where they hope, if you want to buy an exit that, okay they’re good with that.
But they are hoping that you’re going to want to stick around and build something together with them and participate in the upside as all of you are benefiting from shared expertise and the capital that they can infuse in your company without you having to give up your company. Lose your brand, lose control adopt [00:05:00] somebody else’s tool stack, et cetera.
Workland Partners, interesting company, Evergreen, interesting company. There are others out there, some of which I’ve written about at Channel Hog, and it just points out that the options available to you as an MSP, looking to analyze the company, scale the company, maybe not exit, but just get to something bigger and better.
There are more options out there than there used to be, and you don’t have to give up everything that you’ve built to take advantage of those, Erick. Yeah, and you couldn’t be more on point, Rich. Yes, when Mark and I, when we sold our respective practices, it was a completely different environment.
I look at what’s going on now and I and I’ve spoken with the good folks at Evergreen, I know the folks at Workman, and a few other. I think based on my experience, four dozen M and A transactions on the buy and sell side for MSPs in the last 10 years or so, and a few vendors as well.
And these equity investment firms are, and some of them are looking for very specific large MSPs and some are scrappy. And there’s all these different, there’s a few other ones that have really unique and interesting. Strategies as well that, that have reached out to me and I’ve had conversations with them about, but yes, the options are much greater and better for MSPs at any size, obviously, the better the EBITDA, the better the strike price that you’ll be able to command is and things like that.
So not taking anything away from the core. Fundamentals of valuation of a business, high EBITDA and, high multiples of different types of distributed revenue streams, low churn, low customer churn, low employee churn, good leadership, and all these things, right? That feed into this, but boy, oh boy, Rich, it is it is a different.
It’s a different environment out there now. And I think that, we saw dip in transactions during COVID and then we saw a little bit more of an uptick and I think right now, I think we’re still a little bit lower in terms of total transactions than we saw before COVID, but it’s starting to pick up, but we may be we’re not quite where we were before. Some of these unique and distinct strategies that allow MSPs to maintain their brand and image. This is not something that we’ve typically seen in the past. For the the firms that are really trying to create this giant rollup and then sell it as a package later.
So it is unique. And I think that. If you’re an MSP out there, odds are probably getting hammered by folks asking you if you’re interested in selling. I speak to MSPs all the time, like you do rich. And I hear that from everybody, and so everybody’s out there just looking for these for these folks and I think Workland and others like them have found.
A unique opportunity that can attract and make a win for some of the smaller MSPs out there now as well. Yeah, and you’re right. The acquisition market, at least from the private equity side of things is not back where it was before. And that’s because interest rates are very high right now.
Private equity firms rely on leverage when they’re buying and debt is just more expensive. Borrowing is more expensive for them right now. So they are. Much pickier. They’re being more selective. That’s why they’re looking for the million bucks in EBITDA and better and they’re doing more due diligence before they buy.
But the good news is that there are options out there. You don’t have to wait until you’re a million dollar EBITDA company to find somebody interested in investing in you that, like you’re saying. There are these companies out there like Workland and Evergreen and others that are actually looking for smaller companies that they can help grow to a million dollars of EBITDA and do that together with you and instead of in, in place of you there, they want you to be a part of that.
And that’s a way for you to grow what you’ve already built and, participate in the success of that. It is nice for MSPs to have more options. And which one is going to make the most sense for you depends on who you are and where you are in your life and your career and retirement and your aspirations, et cetera.
But having more options is always a good thing. Erick let’s get into your tip of the week here. And it’s actually a a timely topic in terms of some thinking and talking with people that I’ve been doing recently, but I will let you get into it and I’ll explain what I mean about that.
All right. I’m interested to hear that feedback. So Rich, I know that listeners to, to previous podcasts that we’ve been on. I’ve heard me say this folks that have, seen my webinars, I’ve heard me say this and speaking engagements. I’ve heard me say this, and it’s all about standardizing and building a basic minimum bundle of services that you require your clients to sign up for as an MSP in [00:10:00] order to do business with you, no more of this.
Everybody’s got a different agreement and we’re going to swap in this solution for that solution and all this and try to make it work for a client’s budget. We have to be smarter about this now. We want to make sure that our minimum bundle of services includes things. That helps clients demonstrate compliance against their cyber liability insurance policies.
I’m ringing that bell again because we know that claims are being kicked back and denied because of the failure of a business owner’s ability to demonstrate compliance when they have a cyber incident. And they have to pay for their mediation out of their pocket. Typically rich, how do they how do they fund that?
They file a claim with their policy and the policy says, Oh yeah, you did all these things you were supposed to do. We’re going to go ahead and pay that claim or worse, I don’t know worse or better, in some cases the insurance carrier decides to pay the ransom because it would just make more sense.
There are some situations where got you over a barrel and you’ve got to do what you got to do to get back in business if possible. And can you imagine, Rich, a carrier that you’ve been relying on to help you out at the moment when you need them the most to then deny a claim and now you’re stuck with not a lot of good options at that point.
As an MSP, I love the good, better, best way of bundling services, the higher, the value, the higher, the price, but more benefit and things like that. So good, better, best, but you’re good. Or maybe you’re an MSP that just, just sells one thing. Like I put together a portfolio services and solutions, rich that I feel is the best thing for my clients.
Great. But that has to be a standard that you then identify your internal costs, your third party costs of all the, subscriptions and other things that you’re bundling into there, and then you’re establishing your margin and you are selling it at that margin and sticking to it. And that’s why I like good, better, best, because sometimes you can go up and down based upon a client’s budget if you need to, but the point here, Rich, is to.
Establish what that is, make sure that it aligns with the client’s needs and there’s high reliability insurance policies, five or six or seven things that they requiring in order to approve a claim disbursement of funding and go to market that way. And when we look at this, Rich, from that perspective, what we’ll tend to find inside of an MSP’s client list are legacy clients that they’ve had forever that are great clients.
They’re really not very noisy, maybe. Maybe they are, but if they’re not very noisy, but they’re not meeting that minimum margin that you’re establishing for your new clients that come aboard, what they’re doing is they’re, they are stretching you thin on your ability to serve more clients. So this ties back into dealing with the tech shortage, dealing with, the cost of hiring new technicians and things like that.
So it’s a larger conversation when you establish your minimum bundle and your clients have to sign up for that at a minimum to be your client. Then it forces you to look at the rest of your clients that aren’t on that bundle and may not be delivering that margin. So you can try to true them up over time.
My experience, Rich, working with lots and lots of MSPs, there are going to be some clients where a difficult decision needs to be made. Where, boy, if I just release these three or four clients back to industry or help them find another home, maybe they’re C customers, maybe they’re noisy. Boy, I might be able to bring on Double that in new A clients at that margin.
So again it’s a business conversation that you’ve got to have with yourself as a business owner, and you’ve got to hold yourself accountable and not for nothing rich, but greater profit margins allows you to pay your staff better to keep them from getting antsy. When the headhunter calls in know what I mean?
Yeah, I totally know what you mean And I saw you know in our show sheet for the episode You’re gonna be talking about the you know, the minimum bundle and getting everyone on that and by the way totally endorse the idea that you do not want to be doing business long term at least with Anyone who can’t check off?
All of the items that cyber liability insurance companies are requiring them to do, and you can use those requirements as a way to help these companies introduce services they may not be using now but very much need if they want to be covered should a breach happen down the road, but this really sparked my interest because I had the opportunity recently to interview Peter Kujawa, who runs service leadership.
Division of ConnectWise people might remember it more in, in conjunction with the guy who created the company, [00:15:00] Paul Dippel. Paul is retired these days, Peter replaced him, super interesting guy. I’m always grateful whenever I get a chance to speak with him. And we were talking recently about.
The Q3 numbers from service leadership, which goes out every quarter and collects a lot of really good, deep real world business performance data from thousands and thousands of MSPs. And they found that in aggregate, MSPs worldwide grew in Q3 of 2023 by a double digit number. But the variation in there was enormous.
Top quartile MSPs grew by 25 to 30%. Top bottom quartile MSPs lost money, and all of them, Erick. Every last MSP in the bottom quartile and a few of them in the medium quartiles. Lost money in Q3, and I, of course, started quizzing Peter what are the attributes that distinguish top quartile from bottom quartile?
And one of the ones that he cited was that top quartile MSPs sell the overwhelming majority of their clients the best bundle on the good, better, best trio that you were talking about. There’s 70 percent of their clients, in fact, buy into what service leadership calls. The full meal deal, the best of the three bundles available, whereas bottom quartile MSPs average about 52 percent, and you think 52, 70 percent?
Is that really that big a difference? It’s an enormous difference for reasons that you were hinting at in terms of The amount of money that you’re bringing in, the amount of profit that you’re generating from all of these hopefully high margin services that you’re delivering, the way that allows you to recruit and retain employees and invest in the business and provide better service.
So I would just encourage folks by all means, get everybody on a minimum viable package of services that will keep them safe and insured. But get as many of those people as possible on the full meal deal the best of your bundles as you can, if you really want to get up into that high growth quartile of MSPs out there and not get stuck in that money, losing bottom court.
Great, great inside rich and a good tag in adding more, emphasis. On the importance of standardization and then building out good, better, best, because, as your clients grow, instead of selling them the next version of that, one, software solution, you can say, look, it’s time for you to get into our product.
Our next package of services and now your MRR goes up exponentially, moving 500 users to the next level. Important food for thought people. I hope you do think about this and how it it’s or what its implications are for your business. But we are ready to take a quick break right now and then be joined by John Tippett, Chief.
Operating officer of Citricom. He is also one of my go tos, probably my number one go to, quite frankly, on the topic of SMB networking, which is a somewhat neglected topic. So we’re going to take a break. When we come back on the other side, John Chippett. Tippett will join us and we will talk a little bit about the state of the SMB networking market.
And welcome back to part two of this episode of the MSP chat podcast. Ladies and gentlemen, it’s time for our spotlight interview. We are pleased and proud to be joined this week by John Tippett is the COO of Citricom. Known him for a long time. John for folks who are new to you, new to Citricom, tell them a little bit about you and the company.
Yeah, thanks Rich. Glad to have known you for a long time as well. And a former MSP myself. I’ve been in the channel a long time. I’ve learned a lot from from being here. Learned a lot from Erick. As well, when I was running my MSP and just through the growth of my career, I moved over to the vendor side some time ago, developing solutions specifically for the managed services market.
And my, my career journey took me through places like Datto and currently with Citricom. And for those of you who don’t know Citricom, Citricom was also founded by a couple of former MSPs with the initial product around voice and unified communications, developing something that. Was a gap in the market, but with a focus around engineering and product development for solutions for MSPs.
And we’ve grown that product line. Initially, we’re going to expand towards an SD WAN product like the rest of the world was doing in communications and, leapt ahead into a full blown sassy stack over the last couple of years. That is a control one. So now. A full offering of unified communications and a SASE platform available from Citricom.
And that SASE platform and the work you did at Datto before that, there’s a networking through line to a lot of what you’ve been doing since exiting the MSP [00:20:00] world. And as a result of that You’ve been pretty much my go to resource when I want to pick the brain of somebody who really understands SMB networking as opposed to networking in general you’re the guy I think of immediately.
And in fact you have a pretty strong point of view about what it is that SMBs and MSPs who serve them need in networking and why it is that the really big names big obvious names in the networking world, Don’t really provide that. They’ve tried many times through the years. They never quite get it right.
So paint that picture for folks here. What is it that’s different about an SMB network, and why can’t the big networking companies ever quite land that? Yeah, it’s a fascinating topic. And as you mentioned, we’ve talked about it over the years and it is interesting hearing you say it back to me.
I realize I do have a chip on my shoulder being a former MSP and dealing with this and managing the pressures of growing a small business myself, but also delivering outsourced IT services to SMBs themselves that need to stay connected, need to stay secured and, It just often feels like you’re trying to take a square peg and jam it in a round hole looking at, MSPs, we can’t build access points, we can’t build edge solutions, we have to go find things that are available in the market and uniquely match that technology to the needs of the business we serve.
That’s the whole idea of managed services. And then, pay me a recurring service to deliver value and keep you up and running. And. There’s a lot of nuance as to why it’s hard one, one big thing that just permeates is we have a growing channel here, it’s been really exciting over the last few years, the three of us have all talked about this, that, we’ve gone from 10, 15 years ago debating what exactly is managed services to billions of dollars in private equity investing and publicly traded companies that are in our space, and it’s been super exciting, but all that said, We are a tiny dot in the grand scheme of these, a lot of these large companies, and that’s a big deal.
These companies that sell into the governments, enterprise, international business tend to overlook the unique needs of the managed services market, and it creates a lot of pain for MSPs. You have to compete with them directly. You’ve got to sell commodity products. The licensing models are challenging because they just weren’t built.
To be multi tenancy and delivered as a service and combine that with all the things we’ve seen over the last couple of years, the workforce is distributed. Now people work outside of a corporate headquarters. We’re no longer securing the building and the people who are in the building and occasionally having a remote worker.
We’ve moved to where people are all over the place. And at the same time, people went everywhere. So did all the data, everything moved to the cloud and a lot of business applications and. There’s no server running five applications. It’s five different vendors with five different cloud platforms. And it’s created a real challenge for MSVs to keep all the people connected, connect them at the identity level.
Like I need people individually secured and I need to do that to keep up with the security requirements. And yet, when I look at the choices that the large, big providers are delivering, it’s the same stuff. It’s a box that’s put together with a processor and licensing, and I need to buy a thing and pick a model, and it gets depreciated, the models change.
It’s just not working, but it works really well in these, government, enterprise, big business things. There’s a conflict in the channel where there’s a lot of dollars and they don’t make sense, but they make dollars going to the enterprise side. And if you’re in the MSP space, you need to acquire it differently, sell it differently, and the challenges are unique.
And I think to your point over time, we’ve just seen these different things come together, that’s a recipe for a perfect storm in our channel. A lot of demands on MSPs to solve the problem. People are compromising people now, not hacking firewalls. You’re phishing and tricking a human, and you weren’t you weren’t putting like ads and malware on the machine nowadays.
You’re getting ransomware. And with all these things happening, the MSP is in demand, but there’s a mismatch in, how to get to solve it. And I think that’s the genesis of the conversations we’ve had is, I’ve personally been caught in that, and I’m happy and proud to be on the side of delivering solutions and pushing for innovation to help.
Yeah, this is a, this interview is timed right after we all attended and saw each other, John at DattoCom last week. So the timing for our segment is pretty amazing. Getting it, put together this quickly. Now, while we were at DattoCom last week, we heard from a bunch of different Kaseya executives talking about their high hopes for Datto’s networking portfolio, which you used [00:25:00] to run before joining Citricom.
And as you mentioned, the needs of today’s buyers have changed, and the needs of today’s MSPs have changed to try to keep up with This migration to the cloud, it’s enhanced cybersecurity requirement, this hybrid workforce support, not only for clients and customers, but also for an MSP’s staff as well.
So with all of these changing needs and requirements, how big of an opportunity is traditional networking for the SMB market and for SMB partners today from your perspective? I think there’s two sides when we talk about networking, there’s the connectivity itself, you need infrastructure for the foreseeable future, if you zoom out of the MSP channel, you see all the hype and debate, the channel partners events and 5G is changing.
Everything is going to be a point connection. RIch, you’ve written about these things as well, and everybody’s watching. It’s not there. There’s not a world to where every single user and their device independently reaches the WAN. So there’s still, for the foreseeable future, a demand around the infrastructure, physical switches, wireless access points.
Even when you work at home, you’re still connecting to Hardware and devices and there’s, it’s a red ocean of options there lots of good manufacturers, lots of standards. Incidentally, a lot of the physical manufacturing of switches and access points goes back to two or maybe three manufacturers total to do all the work at the core of it.
The challenge has mostly become around the edge and the implementation of security and getting security And cloud access delivered down to the individual user basis. And that is the other side of networking that is where there’s a ton of innovation. And it’s a nice, it’s a nice thing for us that is your capitalistic view.
There’s dollars being spent. There’s pent up demand. There’s big manufacturers that aren’t. delivering things that meet the MSP space. So that’s fueling innovation. And, companies like ours at Citricom are capitalizing and saying, we’re going to help, we’re going to fix that. We’re going to do something here.
And help and that’s where the sassy concept is coming together. It is alive and moving in the enterprise as well there are providers who are doing it in the enterprise the challenge with an enterprise sassy solution is the same Story, it’s sold direct. It’s very complicated to manage. It doesn’t work in a multi tenancy environment and a lot of other options in the channel have tried to bring pieces and parts and they take a product and put a sales team in front of it and you get A software agent that doesn’t have hardware, or you get more of a VPN aggregation concept, not to get too technical, but that brings its own challenges with shared IPs and IP reputation.
To have a true SASE solution that’s built for MSPs, we obviously feel like that’s an enormous opportunity and that’s where we’re focusing on. So I think, Datto switches access points, a solid product. There’s a lot of choices out there. When you start to push the edge connectivity and connecting remote workers I think that’s where the secret sauce is.
And I think that’s where the innovators and the fast movers will win. And it takes a lot of focus and a lot of expertise to, to pull that off and get it right. Yeah. You, I like how you framed it up. It’s that edge is the new frontier and how do we deliver cloud and connectivity to end devices securely?
Would you say that these are basic table stakes, is SASE now a basic table stake, and what other attributes does an SMB networking solution need to have, from your perspective, John, to meet the needs of today’s MSPs and their customers now and moving into the future? Yeah, I think SASE for sure has a category.
Is where the magic is going to be. The interesting thing about it is Sassy today is, it has the benefit that it’s been defined academically. In the gardeners of the world, they have the all respect, they have the privilege of explaining this is what should happen. They don’t build it or make it happen.
So the concept of Sassy is amazing. Like it’s the answer. The trick is going to be, as they say, the proof in the pudding. Oh, we need to make pudding, but we haven’t done it yet. As in, as a broad industry and I think that’s where you’re going to see strong innovation. So to your point about, is SASE the next thing?
Absolutely. You’ll see it in the enterprise coming down. You’ll see it in the MSP space going up. It is the next generation right way to think about connectivity. Our traditional networking solutions Hardware centric. The edge is a physical thing. It is a box that is sitting in a [00:30:00] closet. When you connect different businesses, locations together, you’re doing it in a site to site location.
When you think about how do I connect to Azure, it’s, is it five connections or one, and now I’ve got a remote user, where do I terminate that back to? All these discussions are happening by MSPs, not because that’s desired way to do it. It’s without sass e the only way to do it. And it brings in all sorts of headaches.
When you look at a SASE model, the concept is that the traditional edge is gone, and that the point of ingress and egress exists in the cloud, where it should be, that’s where everything’s happening, that’s where you come and go from the trusted network, but that the security and the access is taking place at the user.
A traditional network, those things happen at the edge, and the edge is a box in a closet. So SASE basically breaks that to say, the point of ingress, egress is at the cloud, but the control is down to the user. So you get a secure access service edge, that’s the acronym, and that concept is very sound.
Execution is where the magic is. Can you actually Pull that off. It takes software, it takes hardware, it takes an understanding of security and routing and connecting all these things together. And that’s where the fun is, as well, is, building and innovating in that space. So speaking of that, let’s talk about execution, because your implementation of SASE at CitraCom is the control one platform that you referenced a little bit earlier on there.
I’ve actually been. Covering that, writing about that, literally, since it it first shipped. Tell folks a little bit about what Control 1 is and what it does. Yeah I appreciate that. And I appreciate the Neutrality of this as well. I’m excited to talk about control one, but the concept and discussion about sassy is it’s where the discussion needs to go.
MSPs need to keep pushing. Hopefully you do business with us. We’re proud to be innovating. There will be other choices, we’re glad to create those choices and push this forward. What we have done with the control one platform is start with the MSP. That is the center of all of the conversations.
And looked at the definition of SASE as it relates to how an MSP will consume it, deploy it, and manage it. And everything we’ve done builds from that. So you have a combination of software and hardware that’s put together in a solution that lets you not have to use any other third party for the connectivity portion.
Some other solutions in the market tell you we’ll connect with software, but you need to go buy another firewall. And again, it’s a lack of understanding of MSPs. I’m an MSP. I don’t want to manage two or three different places where security exists. I want to have all of my access control of my network and security in one place.
That’s the only thing that makes sense. We’ve delivered that in a full blown SASE solution with integrated SD WAN, a zero trust network architecture, and a platform that’s super easy for an MSP to use. Our principle of developing the user interface was that a tier one network engineer Can execute changes like these five people at headquarters need to communicate with these five people at the remote office.
Doing something like that in control one takes seconds, which would take expensive salary certifications and hours with a traditional network with VLANs and all sorts of complicated things. So we’ve built all that and put it together where it’s delivered only through the channel and it’s delivered in a month to month as a service model.
So it’s very easy. There’s no bundling of licensing and minimums and complexities. An MSP can sign a client, deploy control one, one to one to the managed users and sites, and then ramp it up, ramp it down, turn it off however they need to. And that’s been the principle of what we’ve put together.
Everything in one place, easily delivered as a managed service. So John, you and I are recovering MSPs, right? And we’re a special breed, right? Sometimes it takes a little bit of convincing to get MSPs to adjust their view of how to approach something new and introduce it to their clients.
So the three of us have talked in the past about the right way and the wrong way to sell control one and solutions like it. What are your thoughts about how to position, what will get the light bulb? To go off in the mind of an MSP that says, holy cow, this is the direction that I need to move in.
What is that, what is that message that can resonate with an MSP to say this is where my clients are going, this is where the industry is moving, this is where technology and security are moving. I need to look at adopting a solution like this and promoting it to my existing clients to provide them the peace of mind and myself the peace of mind that I’m doing the best job in securing their connectivity for their users.
Yeah, it’s a lot around helping educate. And what [00:35:00] I mean by that is not that MSPs are uneducated, MSPs are very intelligent, entrepreneurial people by nature, and you spend time solving problems. MSPs lack the free time to go look and find new and better ways. As your business is successful and you’re growing, You’re reacting.
The phone’s ringing. You did a good job. You got a referral. There’s a staff that, that’s leaving. Something went wrong. You’re in the business, you’ve talked about this too. And the notion of work on the business and Zoom out is a hard concept for MSPs just like any entrepreneur.
And so one of the things we’re focusing on is bringing information to them. And we’re doing that from two directions. First is to the MSP themselves. When you’re selling a traditional networking solution, there are pain points that MSPs have to deal with. You’re, for example, quoting a third party brand.
That, we talked about this before too with services. You want everything included as possible. You don’t want them talking about any vendors. You want to be the decision maker in everything you possibly can. And you want to earn that recurring revenue. Conversations that you have to have where you are bringing up renewals, licenses, and talking about commodities.
Commodity products is detrimental to your own individual brand. And so we are educating about how to sell as a service, how to bundle things and look at the pain points you have. You’re selling a commodity product today. You have to manage these remote connectivities that are required, remote users, multiple sites.
You’re trying to make sure that you give tight security, but you’re doing that in a way with traditional networking that’s difficult. You cannot create micro segmentation. You cannot stop a third party device from joining the network. If a user knows the password and they went to Best Buy to get a laptop, they can get on the network.
There’s no zero trust concept in a traditional network. There’s a whole category of problems that MSPs face. On the other side of that is the market demands that are being put on the small businesses. Cyber insurance is getting hit hard by these malicious actors, the ransomware, the cyber policies are paying the bill.
And so they’re starting to create rules and requirements and impose those on businesses. All laptops need to have encrypted hard drives. You must keep certain operating systems out of the network. Current operating systems must be patched, etc. This is coming from the insurance companies. That was a foreign concept five years ago.
And then on top of that, you’ve got GRC that’s coming along with things like CMMC. These demands are coming on the business. Insurance companies bring them up. If you’re in the supply chain of the government, you’re getting into CMMC. Now, private industry’s saying if it’s good enough for the government, we’ll follow it too.
And the MSP has to respond to that demand. What we’re focusing on is educating about the dynamic in the market and the opportunities that are available. And then showing how a SASE approach meets the needs of your customer and avoids these gaps that you have as an MSP. So you’re able to meet those needs, reduce risk yourself, and ultimately then you can charge a higher value because you’re delivering things that you cannot do with a traditional network.
You cannot deliver that type of compliance using traditional tools. JOhn, always a pleasure talking with you about this topic. I really appreciate you making some time for us. Before we move on, tell folks a little bit if they want to follow up with you, learn more about you, learn more about Citricom, Control 1 where should they go?
Yeah, the easiest thing, you can reach out to any of us, we’re all happy to chat with you, we’re available on LinkedIn, you can link reach out, shoot us an email. But you can also just go to citricom. com. Both are we’re talking about control one here. Unified communications is there as well. If you’re not a partner, you can become a partner very easily.
We’re happy to have MSPs on board with us. And there’s lots of educational content there as well. And you can book a demo where we’ll get on one and show the product to you and look at your market, your challenges, and show you how we can line up to help you capture more market share and secure your clients and reduce complexity out of your networking stack.
Sounds great. John, again, thank you very much. Folks, we are going to take a break now. When we come back on the other side, Erick and I are going to talk a little bit about SMB networking and maybe have a few laughs and wrap up the show, so stick around. We will be right back.
Alright, and welcome back to Part 3, the final part of this episode of the MSP Chat Podcast. Always a pleasure, truly for me, always a pleasure Erick to speak with John Tippett first because he is a gentleman’s gentleman and I’m struck by that every time I, I run into him out on the road, and there, there is no one like him.
Who is always, more kind and gracious honestly than than John Tippett out there. But also, he’s just been immersed in the world of SMB networking for such a long [00:40:00] time that he really does understand how SMB networking differs from enterprise networking, different from the kind of networking that the Ciscos of the world have been doing for a long time.
There are differences. And it was, I won’t get into the details, but it was something that because Kaseya was talking about it, DattoCon recently that there’s a huge opportunity out there for somebody, for a vendor and for MSP partners of that vendor in SMB networking. And you really get a feel for that anytime you talk to John.
Yeah. And boy, Rich you picked just the right moniker. A gentleman’s gentleman. That is apropos for John and he’s such a. Knowledgeable individual in, in the things that he focuses on and it just comes through and in his, in, in these interviews with him and just in casual conversation, like you say, we run into him at events and things like that.
So it’s really a pleasure to have him on the show. Folks, that leaves us with time for just one last thing on this episode of the MSP Chat Podcast. And actually it’s gonna be two short last things, both of which come to us from the state of North Carolina, and both of which concern the lottery there.
Because for some reason or other, Erick, it seems like the, they’re just churning out oddball lottery stories in North Carolina recently. And so one that I got a kick out of a guy, a winner of the the North Carolina Lottery who won 200 and 66, 982. He was quite naturally thrilled about that and called his mom up to let her know about his good fortune, and it took him a long time to convince her that he had actually won because he is famous in this family for tricks and Tomfoolery Shenanigans.
Shenanigans, let’s say. So when he calls you up and say, hey, I just won 267, 000 in the lottery, you figure, okay, you’re putting me on again. And gosh darn it, he wasn’t this time. And eventually he was able to convince everybody he’d actually won. Then there’s this other one, which I enjoy even quite a bit more.
And I just have to read. The the wire service coverage of this because they wrote it up as if this makes sense and it really doesn’t, Erick. So the story says a North Carolina man said an itchy left hand led to his winning 100, 000 prize from a scratch off lottery ticket. Brian Hicks of Stovall told lottery officials his left hand was itching, so he decided to visit Rosemark on North Garnett Street in Anderson.
to buy a lottery ticket. My left hand started itching. It was like telling me to stop. Was it really Erick? When you’re in the car and your left hand, let’s say, starts itching, is that a signal to you to maybe pull over and buy a lottery ticket? I don’t know, I read this and just thought Good for him.
He, I guess he read that sign correctly because he’s a hundred thousand dollars wealthier than he used to be, but I just can’t follow the logic. Yeah, different aches and pains. I’m gonna start, I’m gonna start paying more attention to what my body’s telling me, Rich. Maybe, maybe I’ll win some money.
And it could be a lot of money. It could, now I know what to do the next time my left hand itches. Just who to guess. fOlks, that is all the time we’ve got this week on the show. Thank you so much for joining us. We’re going to be back again next week. Until then, if you want to watch this episode or other episodes and video, you can find us on YouTube.
The audio only version of this podcast is available wherever you get your podcasts, whether that’s Google or Apple or Spotify or Stitcher, Amazon Music, you name it. You’ll find us there. When you do, please subscribe, rate, review, share, help the rest of the world. Find and enjoy this show just like you do the producer of this show is our good buddy.
Russ johns He is part of the channel master team here. You can learn more about him at Russjohns. com. You can learn more about Channel Mastered at www. channelmastered. com. And last but not least, you can learn more about my blog, Channelholic, which we have talked about a little bit here at channelholic.
news. So once again, folks, thank you so much for joining us. We’re going to see you again in another week. Until then, please remember, you can’t spell channel without M S P.