This newsletter is in BETA, and feedback is welcomed and encouraged. Anyone who joins in the beta will be included in the launch offer! The intention is to deliver a set of actionable insights into the discussions had by the community for vendors to leverage for execution. Does this deliver?
Channel Chatter is the parsing of the listening posts that the Business of Tech podcast has around the MSP community across discussion forums and groups to bring together insights and discussions that I think are worth considering. In considering the needs of MSPs by listening to them for the podcast, there are insights specifically for vendors serving the space to be shared. That is this newsletter.
I’m a sucker for a good “How do I start an MSP” discussion. It’s my most popular piece of content on my YouTube channel, and numbers two and three are variations. It seems I’m not alone. I love the topic because in my mind there are so many ways to do it.
Of course, a topic that is constantly revisited is not always popular.
I just can't any more, I always felt bad when people dog piled on these threads but my god, I just, I can't.
But there are insights to be found.
MSP's are not a few and far between occurrance. The industry is constantly bombarded with new startups all claiming to offer the same thing but with different levels of expertise or niche. It's hard hard work on all levels
You need a vast amount of experience supporting businesses. Running an MSP is 75% customer service, 25% tech.
You need to sell yourself or hire a salesperson.
You won't have time to develop programs to monitor everything AND work onsite, AND do your bookkeeping and ordering.
Anything "Support" is the wrong approach. It is "Managed Services". You and every one of your competitors must provide "support" either way; it's a common denominator. But you're not in the business of just providing support. In fact, generating revenue only when shit breaks is a losing proposition.
Most of the clients you'll find don't care about CCNA or how complex and clean your networks are. Debra just wants her macro enabled mess of an excel workbook that's holding up the entire financial system of the company to 'just work'.
The problem isn't with the MSP business. If done correctly, the MSP biz is a solid, profitable model. No, the problem is with the people that start them. They're mostly technical people who are technically qualified and fully confident in their intellect and ability to pull of the whole "business" thing.
From a business perspective, the MSP model is solid.
But a lot of the potential customers don't want to commit to being a customer of such a model, because they prefer more "breakfixy" kind of arrangements to save cost.
Way back at the beginning of the century, you could run a decent IT consulting business based on your technical savvy. We don't live in that world any more. Today, the business is much more mature and your have to have some business skills.
I have said for many years that most people calling themselves "managed service providers" today are NOT providing managed services. Many people have rushed into this industry because they see the money. But they are horrible managers and should not be allowed to manage other humans.
I have worked with lots of MSPs as I consult to them both technical and business tech. The most successful ones in my experience have had two things in common.
They have startup cash or a decent sized client to get started, because in most locations there is a lot of choice.
It has not been a one man band - the best ones have been a partnership - a decent tech and a sales and marketing person. This gives a good cross mix of skills as it is a very rare person who can do both. They split the admin stuff between them until they were large enough to hire someone to do it for them.
It’s the last pair I’m going to dwell on.
First, the comment is spot on about the change in the market. What I think is missed is that so much more of the technology simply works. One doesn’t need as much technical savvy because so much simply works.
Second, the cash and customer requirements to start are significant. While an extreme example, the new CMMC 2.0 standards seem to make anything defense-related in the US so far out of reach of sub $1M providers as to be laughable. While an extreme example, the requirements to operate a good technology organization are high. Between security, insurance, and basic “cover your assets” discipline, it’s not as simple as hanging out a shingle.
And this is important to remember for vendors. Your successful partners are mature. Your next generation will not necessarily enter the market via technical savvy route. Is your messaging looking for that group too?
Topics of Interest
This section is a high-level summary of the major topics of discussion within the community during the time period. This gives you a sense of the questions the community is raising and what they are discussing.
Datto's Acquisition and Impact on Service Quality: This conversation delved into the real-world implications of Datto's acquisition on its business operations and customer service. The discussion highlighted concerns about deteriorating service quality and increased pricing, reflecting broader industry trends where acquisitions can significantly alter vendor-customer relationships and service standards. This topic is particularly interesting as it underscores the potential risks MSPs face when their key vendors undergo major corporate changes.
VMware’s Strategy Shift Ending CSP Relationships: VMware's decision to end Cloud Service Provider (CSP) relationships and shift to a subscription-only model sparked a notable discussion. This strategic change by a major player in the industry is of high interest as it could reshape partner dynamics and open opportunities for competitors to attract dissatisfied VMware partners. The conversation reflects the broader trend of software companies moving towards subscription-based models and the impact this has on their partners and customers.
The Role of MSPs in Regulatory Compliance: This conversation highlighted the challenges MSPs face in managing regulatory compliance for their clients. It included an important discussion about the risks involved when MSPs overpromise on compliance capabilities. This topic is crucial as it emphasizes the growing importance of compliance in IT services and the potential market need for MSPs with specialized compliance expertise, highlighting a critical gap in the current service offerings.
Microsoft 365 Account Security Incident Despite MFA: A user reported a Microsoft 365 account being hacked despite having Multi-Factor Authentication (MFA) enabled. This conversation is significant as it brings to light the limitations of MFA and the ongoing challenges in cybersecurity, even with advanced security measures. It underscores the need for continuous improvement in security practices and user education, a vital area of focus for MSPs and IT service providers.
Skepticism Towards Starting an MSP Business Without Experience: A detailed discussion around the skepticism towards an individual's plan to start an MSP business without prior experience brought to light the complexities of the MSP business model. This conversation is particularly interesting as it highlights the challenges and nuances of starting and successfully operating an MSP, indicating a potential market gap for comprehensive training, mentorship programs, and resources for aspiring MSP entrepreneurs.
Product Gaps
This section is intended to highlight “gaps” that appear to exist in the market, where a specific weakness or need is highlighted in terms of product offerings. This can also include potential gaps in the market. If you wondered what MSPs “wish things did”, that’s this section.
Customer Sentiment Post-Acquisition (Datto Case): Understanding the impact of corporate acquisitions on customer satisfaction is crucial. The negative feedback following Datto’s acquisition highlights the importance of maintaining service quality and pricing stability post-acquisition. This insight is valuable for planning strategic decisions, especially if acquisitions or major corporate changes are considered.
Adapting to Market Shifts (VMware’s Strategy Change): VMware’s shift to a subscription-only model underscores the need to be agile and responsive to market changes. As a product manager, understanding how such strategic shifts affect customer loyalty and partner relationships can inform how to structure pricing models, licensing agreements, and partner programs.
Demand for Comprehensive Compliance Solutions: The role of MSPs in managing regulatory compliance and the risks of overpromising capabilities suggest a market need for robust compliance management tools. Insights into specific compliance challenges faced by MSPs can guide the development of features that help manage and automate compliance tasks. These tools could help MSPs navigate complex regulatory landscapes and ensure compliance for themselves and their clients.
Understanding Customer Pain Points in Service Quality and Pricing: The dissatisfaction with Datto's service quality and pricing post-acquisition provides a clear example of customer pain points. It’s important to continually gather customer feedback to ensure that your product and service strategies align with customer expectations and market realities.
Emerging Needs in Cybersecurity: The conversations about cybersecurity, particularly the limitations of MFA, emphasize the need for ongoing innovation in this area. As a product manager, staying abreast of emerging threats and evolving security technologies is key to keeping products relevant and secure. Products that offer advanced security features beyond traditional MFA, possibly incorporating behavioral analytics or AI-driven threat detection, could address this gap.
Training and Mentorship Programs for Aspiring MSP Entrepreneurs: The skepticism towards starting an MSP business without experience highlights a need for comprehensive training and mentorship programs. These programs could provide aspiring entrepreneurs with the necessary skills and knowledge to successfully launch and manage an MSP.
Cloud Services Tailored for SMBs: The search for suitable cloud services for small businesses reveals a gap in cloud solutions specifically designed for the unique needs and budgets of SMBs. Cloud providers could focus on creating more accessible, scalable, and affordable services for this segment.
Vendor Discussion
This section is designed to give you insights into who was “discussed” this week. These are vendors that were mentioned or commented upon, and not necessarily a specific set of complaints about the vendor. This may be a good opportunity to learn about a new name, or get a sense of who is in the zeitgeist. It’s long. It’s intentionally long, to give you the firehose.
Access Networks: Mentioned in a conversation about the installation of a second parallel firewall for Quality of Service (QoS). The necessity of this requirement was questioned.
Acronis: Discussed as an alternative to Datto for Backup and Disaster Recovery (BCDR) services.
ADP Lightspeed VOIP: Provides Meraki switches and firewalls, mentioned in the context of a discussion about firewalls and network equipment.
Azure: Mentioned in various contexts, including as an alternative to Datto and in discussions about Microsoft 365 account security.
Beelink: Included in a conversation about product selection criteria by managed service providers (MSPs).
Commcore: Mentioned in a discussion about network equipment and service providers.
ConnectSecure: Recommended for vulnerability scanning in a conversation about cybersecurity solutions.
Crowdstrike: Considered for security solutions, but deemed too expensive for an MSP's clients.
Datto: Discussed extensively, particularly about dissatisfaction with its business operations and customer service. Its acquisition and impact on service quality were also topics of conversation.
Defendify: Mentioned as a vendor for vulnerability scanning.
Dell: Part of a conversation about MSPs' preferences in product selection, particularly laptops.
Domotz: Mentioned in a conversation about finding a suitable device for remote probe deployment for the Datto RMM system.
Flexpoint: Discussed as a payment processor that integrates with ConnectWise and Quickbooks Online.
Galactic Advisors: Suggested for vulnerability scanning in a cybersecurity context.
GoDaddy: Mentioned in a conversation about Microsoft 365 account security issues.
Greenway Intergy: Suggested as a practice software alternative for a podiatry clinic.
HP: Discussed in the context of product selection by MSPs, particularly regarding laptops.
Huntress: Considered for security solutions but found too expensive for an MSP's client base.
Invicti: Mentioned as a 'sponsored' result from Google in a conversation about security scanning.
Kaseya: Discussed in the context of customer service issues and business practices.
Lenovo: Favorably discussed for its pricing, repairability, and quality in a conversation about product selection by MSPs.
Meraki: Discussed in the context of network equipment and services provided by ADP Lightspeed VOIP.
Microsoft 365: Frequently mentioned, particularly in the context of reselling and account security issues.
Oracle: Mentioned in a conversation, but the context was not clear.
Pax8: Discussed in various contexts, including as a vendor for Microsoft 365 and in conversations about alternatives to AppRiver.
Phin: Recommended for cybersecurity training in a conversation about security solutions.
Practice Master Pro: Discussed in the context of a podiatry clinic looking for alternative practice software.
Qualys: Suggested for vulnerability scans and deeper web app scanning.
Rippling: Mentioned in a conversation about IT provisioning and SSO capabilities.
Roboshadow: Mentioned without further information in a conversation about security scanning.
Shield Cyber: Suggested for vulnerability scanning in a cybersecurity context.
Sophos Intercept X and XG: Discussed in the context of endpoint protection and firewalls.
Sucuri: Mentioned several times as a service for continuous protection and website security scans.
Tech Tribe: Suggested as a networking opportunity for MSPs.
The Host Broker: Recommended for MSP owners looking to sell their businesses.
Veeam: Discussed as an alternative to Datto for BCDR services.
VMware: Mentioned in relation to its strategy shift and impact on partners.
Vonahi: Suggested for vulnerability scanning in a cybersecurity context.