MSPmentor

When VARs, MSPs and IT solution providers evolve their businesses to include a managed services practice, the goal is to deliver recurring services to ensure recurring revenue and recurring profit. While it’s not so easy as to convert to this model overnight, start by identifying an entry point to deliver managed services to a new or existing client and build your practice over time. Let’s take a cross-section of one year operating with this business model and discuss how you can build a similar practice layer by layer.

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I concede: This isn’t your typical managed services story. It starts with Administaff, a full-service HR organization for small and midsize businesses, acquiring portions of OrgPlus — a software package used by more than 50,000 businesses worldwide. As I read about the business combo, I started to wonder if managed services providers (MSPs) will leverage OrgPlus within their own halls.

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Cherwell Software, an IT service management and help desk specialist in Colorado Springs, Colo., has a rather interesting take on exit strategies. Chairman and President Vance Brown, formerly CEO of Goldmine Software, says he focuses on “yesterday’s values” of solid support, rather than modern day pursuits involving venture capital and exit strategies.

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Roughly twice per week, I hear from a potential investor or suitor who’s looking to make a move in the managed services market. The latest note to hit my inbox comes from Technology Capital Investors, a New York-based firm that focuses on “MSPs that offer cloud-based services or are looking to build out a cloud-based infrastructure.” Considering the cloud craze that’s a pretty broad definition.

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Consider the following scenario: Government leaders demand that you shut down your managed services within a specific country or region during a political crisis. Should you bow to the demands and go dark? Or do you have a moral obligation to maintain service for your customers in that region? It’s quite a dilemma — one that has come to the forefront during the current crisis in Egypt.

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Greetings from 30,000 feet. I’m on a Red Eye flight from San Francisco to New York, following a busy week of meetings in Silicon Valley. I’m tired… but optimistic. Silicon Valley companies are upbeat about business; they’re hiring; and quite a few of them are talking managed services — and Talkin’ Cloud. Locked in meetings portions of this week, here are seven blog entries MSPmentor didn’t have a chance to write for the week ending January 28, 2011.

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It has been roughly a year since Arnie Bellini (pictured) and David Bellini launched ConnectWise Capital, an investment fund that seeks to incubate channel-centric IT solutions for managed services providers (MSPs) and VARs. So, how are the first two investments — CharTec and LabTech Software performing? And can we expect ConnectWise Capital to make new investments? Both Arnie Bellini and David Bellini share some insights in an MSPmentor FastChat Video.

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In the classic reseller channel, sales and marketing back in the day consisted of hanging up a sign and waiting for customers to walk through your front door. That was fun while it lasted. Today, with the world becoming smaller and the marketing noise becoming louder, managed services providers like you have to fight through a whole web of marketing and sales options to make your impact. It is overwhelming, really. But don’t panic. Marketing and sales can be broken down into four major components. Here’s how to get started.

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Sponsored Video: In recent years, GFI Software has been in acquisition mode. Major areas of focus include the GFI MAX family of hosted solutions for MSPs and VARs in the SMB market. The GFI MAX portfolio has grown to include GFI MAX RemoteManagement, GFI MAX MailProtection and GFI MAX MailEdge. But how exactly is GFI MAX working with MSPs and solutions providers? Alistair Forbes, general manager of GFI MAX, shares some answers in this MSPmentor FastChat Video.

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CompTIA, which acquired MSP Partners in 2009, is making some adjustments and preparing some new moves that should surface by April 2011. Specifically, CompTIA is preparing a “managed services industry credential” that seeks to help top MSPs stand out from the masses. Interestingly, CompTIA does not use the term “accreditation” or “certification” to describe the forthcoming industry credential. Here’s the update.

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Making a real transition to a managed services model is just plain hard work. It’s easy to recognize that recurring revenue is a good thing. It’s quite another to assemble a set of valuable services that are real, stable and demonstrable to the customer. It’s one thing to say, “This is a completely different business model than break-fix”; but quite another to make it work. For those who succeed, the rewards are great. Revenue and margin growth are generally confidential, but buy-outs and regional growth are more visible.

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Here’s an interesting piece of news that deserves bigger-picture consideration: ScaleMatrix, an upstart managed service provider (MSP), has major cloud ambitions. ScaleMatrix plans to use CA Technologies‘ 3Tera AppLogic software to offer a range of services such as application hosting, Infrastructure as a Service (IaaS), Platform as a Service (PaaS) and Virtual Private Data Centers (VPDCs). So why should MSPs care?

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I’m en route from New York to  Silicon Valley. My destination: Oracle’s headquarters, where I’ll be sitting down with Oracle Channel Chief Judson Althoff and Kevin O’Brien, senior director of Oracle’s ISV and SaaS strategy. While prepping for the meeting, I recalled an Oracle-centric discussion I had during the N-able Partner Summit in October 2010. At that gathering, Ntirety CEO Michael Corey — a long-time N-able partner — told me his business was built around managed database services. Is that a hot new niche?

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Generally speaking, numerous remote monitoring and management (RMM) tools support remote Linux administration. But Opsview, an open source RMM solution, is making some noise in the SUSE Linux market. The noise comes as Attachmate acquires Novell, the keeper of SUSE Linux. Here’s the update.

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Ugh. Another snowstorm is moving in here on Long Island. And I’m scheduled to moderate an MSPmentor Live webcast from 2:00 p.m. to 3:00 p.m. eastern today. So how do I cope with bad weather — especially when snow and ice can knock out power to my home office? My answer is rather simple: I call a local managed services provider, head to their NOC (network operations center), and moderate our webcast from their offices.

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The next MSPmentor Live webcast is today (Wednesday, January 26) at 2:00 p.m. eastern. The topic: Six Questions You Need to Ask Yourself before replacing your RMM (remote monitoring and management) software. We hope you join us for the discussion; we’ll cover dozens of attendee questions throughout the webcast.

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What an interesting time to be an MSP. Cloud computing in 2011 is like a dominant new predator wading into a well-established food chain at the top. The major Platform-as-a-Service providers have kicked off a cycle of rapid adaptation in the rest of the technology value chain. MSPs of all sizes, shapes and market segments are reconsidering their channel alignments, redesigning their business models, and fast-tracking the development of complementary software and service offerings. Some are building cloud integration practices. Some are specializing in application development for cloud deployment. Some are stacking new services of their own on others already running in the cloud.

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As Level Platforms prepares to host managed service provider (MSP) gatherings in 19 cities, two software giants — Microsoft and Symantec — will hitch a ride to more closely monitor and learn about the MSP sector. It’s the latest sign that both Microsoft and Symantec are finally waking up to the next-generation channel. Here’s why.

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Instead of competing with corporate IT departments, a healthy number of managed services providers (MSPs) cooperate with corporate IT managers — creating a virtual bridge between MSP and corporate IT. Tools like ConnectWise StreamlineIT and Autotask Taskfire can help the process. But the effort also takes serious commitment from MSPs. Here’s the update, including a FastChat Video conversation with ConnectWise CEO Arnie Bellini.

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Multiple sources confirm that Synnex, the massive distributor, has launched a multi-vendor managed services effort that includes Axcient, Intronis, Level Platforms and Reflexion Networks — though additional software partners could be coming. Here’s the update.

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Dell KACE furthers its departure from stealth mode with the announcement that as of Feb. 10, 2011, MSPs will be able to use its updated K1000 systems management appliance to oversee endpoints connected directly to U.S. government agencies. And it includes a compliance policy scanner to ensure that managed machines are playing by the rules. Here’s the scoop:

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Each Tuesday, MSPmentor’s Ask a Mentor service publishes a reader question and invites you to weigh in with recommendations. This week’s question comes from a Florida-based seeking some information on sales compensation strategies. Here’s the question and our reply…

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The MSPmentor team is working on two webcasts. One is this Wednesday, January 26. The other is Wednesday, February 16. You can use this single link to get more details about both webcasts. The January 26 webcast explores Six Questions You Need to Ask Yourself before replacing your RMM (remote monitoring and management) software. The February 16 webcast will unveil our fourth-annual MSPmentor 100 list. We look forward to answering your questions during both webcasts.

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