Should I Sell My MSP Now or Later?

Making Sure You’re Ready to Sell

In the first installment of this two-part series, we discussed the favorable market conditions that make now a GREAT time to sell your MSP. But market timing is only one piece of the puzzle.

It’s also important to establish whether your MSP business is ready to sell. Is your MSP ‘sellable’?

The short answer is that your MSP is sellable if someone’s willing to buy it. And no, we’re not being glib. It’s all too easy to forget that success in the world of mergers and acquisitions (M&A) boils down to one thing: connecting with the right buyer (or partner, in the case of a merger). Without this crucial piece of the puzzle, everything else is moot.

That said, there are some general factors that strongly influence an MSP’s appeal as an acquisition target. Let’s start with the obvious one: size.

Size Matters

So, what size MSPs are typically sold in today’s M&A landscape?

There’s no simple answer to this question, because different buyers have different requirements – sometimes markedly different.

Some buyers focus on growth and immediate profitability; this type of buyer will be on the lookout for MSPs that bring in serious revenue (at least $2 – 5 million annually), strong EBITDA margins, and a history of consistent expansion.

Other buyers might be more interested in acquiring smaller, less growth-oriented MSPs if they see strategic value, such as access to a new geographic market, unique talent pool, or specific client base.

Bottom line – Even if your MSP falls on the lower end of the revenue spectrum, your unique strengths can help you attract strong offers in the M&A landscape. So, don’t let the fact that you haven’t hit such-and-such a revenue threshold prevent you from even looking into entering the M&A arena.

But whatever your MSP’s size, the following characteristics are sure to impress any potential buyer of your business…

You ≠ Your Business

Your MSP is yours, sure, but that doesn’t mean you and your MSP should be essentially synonymous. You shouldn’t be your business. Wait, what? Let us explain…

A lot of smaller MSPs are more or less dependent on their owners to run smoothly. This can stem from insufficient documentation, or from the owner’s own inability to let go and delegate. Whatever the case, this high level of dependence is something potential buyers don’t want to see – in fact, it’s a huge red flag.

Think about it. If you are your MSP – i.e., if your clients’ loyalty and the integrity of your processes all depend on your direct involvement and presence – there’s a greater chance things will fall apart in your absence. Of course this is going to scare potential buyers!

Bottom line – To get your MSP ready to sell, make sure you have robust documentation and comprehensive processes in place, as doing so will help assure buyers that your MSP will continue to run smoothly under new ownership.

A Relevant Link

Looking for a shortcut to becoming an operationally mature, process-driven company? Consider joining The 20 MSP Group! We take small and mid-sized MSPs and equip them with proven and scalable processes that not only unlock serious growth, but also, impress potential buyers when it comes time to sell your company.

Get in touch to learn more about The 20 and how we help MSPs standardize, scale, and grow like crazy.

Good-Looking Books

Potential buyers will scrutinize your books to evaluate your business’s health and potential, so make sure everything is in order. And we’re not talking in ‘pretty good’ shape either; we’re talking pristine.

Clear, accurate, and up-to-date financial records will not only help you secure a fair valuation, but also build trust with buyers and facilitate a smooth transition. So make sure your books are meticulously organized, as it will help lay the groundwork for a seamless sales process.

Diverse Revenue Streams

This one is straightforward. Buyers not only care about how much revenue your MSP pulls in, but also, where it comes from. More specifically, you don’t want all your revenue – or even most of it – to come from just one or two places.

It all comes down to risk. The more tied your MSP’s income is to just a few clients, the greater risk it poses to any potential buyer of your business. What happens if you lose one of your core clients? Potential buyers don’t want to find out.

For a more detailed, quantitative breakdown of ideal ‘revenue composition,’ download The 20’s free guide to MSP acquisitions: Sell Your MSP the Right Way.

Talented Team

People matter. Your MSP business isn’t just a collection of tools, processes, and revenue streams. It’s also a team of human beings who work together each day to bring your clients exceptional support.

If you’re thinking about selling your MSP, it’s important to keep in mind that your team – what they know and how they work – can be a major draw for interested buyers. Talented technicians are especially valuable in today’s market, where there’s a notable shortage of skilled labor.

Bottom line – If you have a talented technical team with great work ethic and a high level of dedication to client success, it can significantly enhance the value and attractiveness of your MSP to potential buyers.

Summing Up

While there are a number of qualities that make an MSP appealing to buyers, there isn’t a one-size-fits-all ‘profile’ for a sellable MSP.

Different buyers have varying criteria and strategic objectives, so what makes one MSP attractive might not apply to another. Factors such as operational independence, diversified revenue streams, and clean financial records are important, but the unique

strengths and strategic value of your MSP can also play a significant role in its marketability.

At the end of the day, our advice to MSP owners is to err on the side of exploration. Market conditions are so favorable at the moment, with an abundance of hungry buyers on the lookout for quality MSPs to acquire, that it’s worth investigating your options and assessing your MSP’s potential for sale.

Looking for expert feedback on your current exit strategy? Book an hour with Tim Conkle, The 20’s CEO and the visionary behind our unique M&A strategy.

The 20 MSP Honored with Pax8 2024 Top Global Non-Profit Partnership Award 

Plano, TX – The 20 MSP today announced it has received the 2024 Pax8 Beyond Partner Award in the Global Non-Profit Partnership category during Pax8’s 2024 Beyond conference. The awards program recognizes partners who drove significant revenue growth, cloud adoption, and the success of companies worldwide by leveraging their relationship with Pax8 and its innovative Marketplace. 

“We are thrilled to be honored with the Pax8 2024 Top Global Non-Profit Partnership award. This recognition is a testament to our team’s dedication and commitment to empowering non-profits. Thank you to Pax8 for this incredible honor,” said Tim Conkle, CEO of The 20 MSP. 

Held in Denver, CO, from June 9-11, Beyond 2024 provided Pax8 partners with three days of immersive learning, community, and innovation. Attendees gained critical business insights through keynote presentations from industry leaders, custom-built breakout sessions, and an expo hall with over 100 sponsoring vendors. 22 awards were presented during the final day of the conference, showcasing the incredible transformation, impact, and success these partners are having on the channel ecosystem through their partnership with Pax8.  

“Our partner community advances the channel through their dedication to enabling small and midsized businesses worldwide with cloud technology solutions,” said Rob Rae, Corporate Vice President of Community and Ecosystems at Pax8. “These awards recognize their continued focus on empowering customers with advanced solutions in order to drive their business and transform the industry.”  

About Pax8 

Pax8 is the world’s favorite cloud marketplace for IT professionals to buy, sell, and manage best-in-class technology solutions. Pioneering the future of modern business, Pax8 has cloud-enabled enterprises through its channel partners and processes one million monthly transactions. Pax8’s award-winning technology enables managed service providers (MSPs) to accelerate growth, increase efficiency, and reduce risk so their businesses can thrive. The innovative company has ranked in the Inc. 5000 for six years in a row. Join the revolution at pax8.com.  

About The 20 MSP 

The 20 MSP has been helping businesses succeed through better technology since 1986. As a leading provider of managed IT services, The 20 MSP serves thousands of businesses nationwide, providing each one with white glove service, secure and streamlined IT infrastructure, and 24/7/365 support. We believe in building lasting relationships with clients founded on trust, communication, and the delivery of high-value services for a fair and predictable price. Our clients’ success is our success, and we are committed to helping each and every organization we serve leverage technology to secure a competitive advantage and achieve new growth. To learn more, visit the20msp.com. 

Should I Sell My MSP Now or Later?

Making Sense of Market Trends

Let’s say you’re thinking about selling your MSP. You’ve put quite a few years into it, along with some blood, sweat, and tears, and now you’re thinking about getting out – ideally, with a nice paycheck in hand for all your efforts.

But should you sell your MSP now? Or, should you wait it out? Bide your time. Grow a little more…

This is a terrific question, and it couldn’t be timelier. M&A activity is once again on the rise. Actually, it has risen – and quite dramatically! MSP owners are approaching the table in droves in search of lucrative deals, driven by a large pool of interested buyers.

You’re of course tempted to get in on the action. But you’re not sure if it’s the right time. It’s such a big decision. You just don’t know –

Relax. Take a breath. And keep reading. You deserve some clarity, and while we can’t make the all-important decision for you, we can give you the information you need to make the right choice for your business and your clients.

In this first article in a two-part series, we’re examining the question of ‘now or later’ through the lens of market conditions. In part two, we will zoom in on what makes an MSP ‘sellable.’ Let’s dive right in!

Seize the Moment

Should you sell your MSP now? Assuming your MSP is ‘sellable,’ is now a good time to enter the M&A arena in search of a deal?

The short answer is unequivocal: All things being equal, now is a GREAT time to sell your MSP. The main reason comes down to basic economics and a little thing called demand…

After cooling off briefly in 2023, we are in the middle of another M&A hot streak projected to match if not surpass the buying frenzy a few years ago, which saw nearly 2000 deals closed! Right now, the market is flush with PE firms and large ‘platform MSPs‘ who are all salivating at the prospect of purchasing quality MSP businesses. MSPs make attractive acquisition targets for a number of reasons, which we go over in our free MSP acquisitions guide (get your copy).

Bottom line – Selling your MSP right now means taking advantage of near-perfect market conditions. Simply put, it can make you a pretty penny.

But what about…

You may still have some reservations. This is only natural. After all, you’re thinking about selling your MSP business, not lemonade on a street corner. Market conditions might be ideal, but what about…

What about, well, waiting? If M&A heated up in 2021 and 2022, cooled off in 2023, and once again heated up in 2024, can’t you just wait a little longer – till the next surge in M&A activity?

In theory, yes. But in practice, things aren’t so simple. For one, markets are inherently unpredictable. How many years will it be until you see an opportunity like this again? Do you have the energy to continue running your MSP for three more years? Five? Ten?

More importantly, M&A activity is so rampant, it’s literally changing the competitive landscape. As more and more MSPs get rolled up, we’re seeing larger and larger MSPs emerge – platform MSPs with never-before-seen resources and capabilities. And as these ‘super MSPs’ get bigger, so too will the MSPs they target for acquisition (in fact, this has already begun to happen). This means you will likely need to continue growing steadily to remain an attractive acquisition target further down the line.

You might be thinking, So what. I can keep growing. No problem…

While we admire your confidence, it’s important to know what you’re up against. Remember those super MSPs we mentioned a second ago? They’re your competition from here on out. That means if you want to sustain your current growth rate, you’re going to have to work twice as hard just to keep pace with these multi-state and even national enterprises.

This article does a terrific job of summarizing the challenges MSPs will face over the next ten years. Doing things on your own might have worked until this point, but times change, and making your exit now could be a timely way to avoid a very tough road ahead.

There are also your clients to think of. Is grinding things out on your own really what’s best for them? Getting acquired by a larger enterprise can mean getting access to crucial resources, better tools, more talent – all good things that can help your clients find success.

Does this mean you should sell to the first buyer that comes a-knockin’?

Absolutely not! Thoroughly vetting potential buyers is vital to securing the right deal for your MSP business. At the very least, a potential buyer should…

• Demonstrate a track record of successful MSP acquisitions
• Share your company’s values and vision
• Offer a fair valuation and proof of financial backing
• Commit to supporting your employees and maintaining operational continuity

Check out our free guide to MSP acquisitions for a more detailed discussion of evaluating potential buyers.

The Heart of the Matter

Let’s talk feelings. Maybe you’ve determined that your MSP is worth selling. Maybe you’ve got a few interested buyers. Maybe you’ve even received an offer. But nevertheless, you’re not sure you’re ready. You don’t feel all that ready…

Look, we get it. Selling the company you built from the ground up is an emotional experience – and one of the biggest decisions of your life. You’re going to feel things. A lot of things.

But the truth is, you’re likely never going to feel completely, one-hundred-percent ready to sell, the same way most parents don’t ever feel totally ready to send their kids off to college. But when the time’s right, the time’s right.

This isn’t to say you should ignore your feelings. If you feel profound doubts about a particular potential buyer, for instance, listen to your gut! You don’t want to sell your MSP to the wrong buyer, because it could leave you with a raw deal and your clients up a creek.

But general nervousness about the prospect of selling your MSP is completely natural and to be expected. You’re only human! So let yourself feel – just don’t let your feelings stop you from seizing a golden opportunity.

A Unique Opportunity to Talk Strategy

It’s no secret that we’re involved in M&A here at The 20. In fact, at the time of this writing, we’ve completed over 30 MSP acquisitions – and we’re looking for more quality MSPs to join our growing team!

The secret to our M&A success is no secret – our approach makes things easy and brings unique benefits to MSP owners and their teams.

Want to learn more? Book a 1-hour meeting with Tim Conkle, CEO of The 20 and the visionary behind our unique consolidation strategy. Tim can walk you through what makes The 20 unique among M&A players, as well as provide you with feedback on your current exit strategy.

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Stay tuned for the second installment in this two-part series, where we’re tackling the question of what makes an MSP ‘sellable.’ Till then, browse our freshly launched MSP acquisitions page for free resources and no-nonsense guidance.

From Owner to Employee: Navigating a New Role After Selling Your MSP

You’re selling your MSP business. Maybe you already have. Now what?

For some, the answer to this question is: relax on a beach, margarita in hand – or some version of that. And there’s nothing wrong with that! Selling your MSP business can be your ticket to a leisurely – and financially secure – retirement.

But what if you’re not ready to ride off into the sunset just yet? What if your passion for managed services still burns, and you want to continue working in the IT industry?

Nothing wrong with that either! Plenty of MSP owners have entered the mergers and acquisitions (M&A) space with no intention of retiring or even leaving the IT sector.

If you’re looking to sell your MSP but not exit the industry – or if you’ve already sold your company and now find yourself in a new role – you’ve come to the right place. In this article, we’re discussing how to make the most of your transition from owner to employee after the sale of your MSP business.

Our focus will be on situations where you join the team of the company acquiring yours. That said, if you’re pursuing a position elsewhere in the industry, a lot of the advice will still hold value.

Let’s jump right in!

Why Stick Around?

Let’s start with a basic question: Why do some MSP owners choose to sell their businesses without subsequently exiting the industry?

Here are some of the more common reasons…

Sweet Deal

Some MSP owners approach the table because they’ve found the ideal buyer – or an offer that’s simply too good to pass up – and not because they’re feeling burned out or ready for retirement. This isn’t uncommon, as the M&A market has once again heated up in 2024, with many interested buyers competing over high-performing MSPs.

All things being equal, it’s a great time to sell an MSP! If you play your cards right, you can make your exit with a big paycheck in hand.

Staying Alive

Some MSP owners strike deals because they’re thinking ahead and anticipating the difficulty of remaining competitive without adding new services, skills, etc.

According to Datto’s Global State of the MSP Report, for the third consecutive year, MSPs worldwide cited competition as their primary challenge, with 35% highlighting it, up from 29% in 2022. Finding a competitive edge is more crucial than ever, and consolidation offers ambitious MSP executives a promising route to securing an advantage by ‘leveling up’ their services, teams, and market reach.

Ready for Help

Finally, there are those MSP owners who are looking to sell because they’re tired – tired of running the show and having to wear all sorts of ‘hats’ just to keep their companies afloat. Some of these executives really enjoy a particular aspect of running an MSP (e.g., sales or operations), and want to focus on doing that one thing extremely well.

Selling offers these entrepreneurs a promising route to a more manageable work schedule, as well as a more specialized role that allows them to focus on what they enjoy doing and know how to do well. Come to think of it, becoming a member of The 20 helps with those things, too!

From Owner to Employee

Bottom line, there are plenty of good reasons to sell your MSP without the intention of retiring or even leaving the industry.

So, let’s get into the meat of our discussion: making a successful transition from an MSP owner to an MSP employee.

This blog post accompanies a short video featuring former MSP owners now thriving in new roles at The 20. Check out the video to hear their firsthand accounts of the transition “from owner to employee.”

What makes for a successful transition from MSP owner to MSP employee? Let’s start with a simple but illuminating answer:

If your plan is to keep going, you need to set yourself up to do exactly that – keep going.

Think about it. You’re not retiring. You’re not even changing industries. You’ve decided to remain a managed services professional, albeit in a new role. So, it’s important, for your own wellbeing – both professional and personal – to put yourself in a position that you find energizing and fulfilling. This is especially crucial if the reason you’re selling in the first place is fatigue, or even burnout.

But how do you do that? In practical terms, what is the best way to ensure that you find fulfillment in your new role?

After completing numerous MSP acquisitions (thirty-three at the time of this writing), we’ve witnessed plenty of MSP owners make the transition from owner to employee. Seeing their journeys has taught us a lot about what a successful transition involves.

And now we’re sharing key lessons with you…

Work Your Magic

After years spent running an MSP business, you probably have a pretty good idea of what you’re good at – and not so good at. You also likely know which aspects of the job bring you the most enjoyment.

In the short video, you’ll meet Gary Blawat, who loves MSP sales. You’ll also hear from Kevin Peterson, a self-proclaimed “operator at heart.” After selling their MSPs to The 20, Gary and Kevin took on new roles within the company which allowed them to focus on sales and operations respectively.

When pursuing a new position post-sale (and negotiating its terms), we recommend that you follow in Gary and Kevin’s footsteps and find a role that allows you to work your magic. Doing so will make a huge difference when it comes to staying motivated and engaged. Just ask Kevin:

“I’m able to focus most of my time on doing what I’m really good at and what I love doing. I get up every morning and I know I’m making a difference … I love what I’m doing.”

Shared Vision

Tim Knarr sold his MSP to The 20 back in 2022 and is now doing big things as our VP of Regional Operations. In the video. Tim talks about “the dream” of The 20 – the dream of the billion-dollar MSP. It’s a dream he believes in and feels connected to.

This brings us to another important point about securing satisfaction in your post-sale role: in addition to landing the right role, you’ll also want to join the right team.

More specifically, you should strive to become part of a team with goals and a long-term growth plan that excite you. You’re committed to sticking around after selling your MSP, so it only makes sense to join a company that’s not only going places, but places you want to go.

If you’re planning on working for the company that acquires your MSP, picking the right organization means picking the right buyer, and that begins with thoroughly vetting any potential buyer (for tips on vetting buyers and much more, make sure to download our free MSP acquisitions guide, “Sell Your MSP the Right Way”).

Invest to Stay Invested

Landing a role that lets you focus on what you like doing, joining a team whose vision you share – both of these things will help you remain engaged in your new role. But you know what will really help you stay invested?

Investing!

After selling your MSP, you can take a portion of the proceeds from the sale to purchase shares or equity in the acquiring company, giving you a vested interest in the combined entity’s success.

That’s a big part of our deal structure here at The 20. In the video, you’ll hear from Caleb Brown on the value of being a shareholder, and how it gives him a robust “sense of ownership with what we’re building now” – a national MSP with premium service delivery! It also doesn’t hurt that these owners-turned-shareholders will get a ‘second bite of the apple’ further down the line if and when The 20 gets acquired.

For a closer look at The 20’s approach to acquisitions and how it compares to some other prominent M&A players’ strategies, check out this excellent article from Channelholic.

Balancing Act

Perhaps the most profound observation from our interviews with MSP-owners-turned employees came from Michael Vu, who spoke about finding a healthier work/life balance after the sale of his MSP business.

Michael, like almost all of the MSP owners who sell to The 20, chose to remain on board in a new leadership position. He’s since discovered that he has, in his new role, a lot more time to spend with his family. Making room for family – for life – can be hard

when you’re captain of the ship. As Michael points out, “when you’re running your business from top to bottom, it takes ninety-nine percent of your energy and focus.”

Word to the wise: finding a more suitable work/life balance after selling your MSP can be easier said than done. After spending years at the helm of your company, you’ve likely grown accustomed to the perpetual grind. Just know that it can be difficult to adopt a new mindset once you’ve sold your MSP. However, doing so can work wonders for your overall wellbeing.

Remember, you did something special – you built and sold a company! Take time to savor your achievement, and be wary of falling back into the same relentless pace that defined your days as an owner.

Wrapping Up

Selling your MSP is a big decision – one of the biggest decisions you’ll ever make. It can also mean a transition to a new role. In our experience working with MSP owners who make this jump, it’s not so much stepping back as it is stepping up.

You’re stepping up to a new challenge. You’re seizing an opportunity to focus on what you’re good at and enjoy doing. You’re getting access to a larger team with better tools and processes to help your clients thrive.

This isn’t a demotion however you slice it. It’s the next chapter of your story, and it’s brimming with potential. So embrace your new role, because there’s a good chance the best is yet to come.

Need Some M&A Guidance?

If you’re thinking about selling your MSP or entering a merger, we’re here to help.

Check out our revamped guide to MSP acquisitions, “Sell Your MSP the Right Way” for practical advice and proven tips. Get your free download today.

Looking for direct feedback on your exit strategy? Set up a 1-hour call with Tim Conkle, Founder and CEO of The 20 and leading expert on MSP acquisitions.

Happy dealmaking!

The 20 MSP Broadens Reach with Latest Round of Acquisitions 

The 20 MSP bolsters national footprint with trio of new roll-ups. 

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Full Press Release Here 

PLANO, TX, May 01, 2024 — 

Premier managed IT services provider, The 20 MSP, has announced the completion of three more MSP acquisitions. Joining The 20’s rapidly growing ranks are Tech Junkies (Kansas), Matrix Solutions (Mississippi), and Level 10 Technology (Kentucky & Tennessee). 

These acquisitions are the latest moves in an aggressive M&A plan that started in 2022 with a flurry of deals. Thirty-three acquisitions later, The 20’s extensive roll-up is well under way, and according to the company’s founder and CEO, Tim Conkle, there’s plenty more in the pipeline. 

“We have a large pool of MSPs interested in selling to The 20 – companies that belong to our membership-based growth platform, The 20 MSP Group, as well as MSPs that caught wind of our unique M&A approach and want in on the action,” Conkle shared. 

The 20’s consolidation strategy is unique in the extent to which it builds on pre-existing synergies, including shared tools and processes to ensure standardization and seamless scalability. 

“While it’s true we’re acquiring MSPs at a fast clip, there’s absolutely nothing rushed about our process,” Conkle said. “That’s because we prioritize alignment in our selection of acquisition targets. This is essential to the end game, which is of course building a truly national MSP with uniformly excellent service.” 

The 20 is well on its way toward achieving this goal, and it’s worth noting that almost all of the MSP owners who sell their companies to The 20 are sticking around the long haul, assuming leadership positions within the organization. This holds true for this latest round of deals, highlighting a key element in The 20’s approach. 

“We’re retaining not only leadership, but also employees,” Conkle explained. “That’s because we’re acquiring companies who share our long-term vision and are already lined up with our way of working. This means less friction, fewer unforeseen hiccups, and happier employees and clients. Our attrition rates are virtually non-existent with these deals.” 

As The 20 casts its net more widely to include non-member MSPs in its pool of acquisition candidates, it remains steadfast in its commitment to preserving standardization and operational unity. 

“Some MSP owners want to sell but still remain relatively independent, operationally speaking,” said Conkle. “That’s a viable approach, but it’s not ours. We’re building something big, and it’s vital that we’re all on the same page when it comes to the important things – processes, culture, and strategic vision.” 

The 20 is also giving MSP owners the opportunity to reinvest in the conglomerate, setting them up for a ‘second bite of the apple’ further down the line. 

“The MSP owners transitioning to new roles within our organization have skin in the game,” said Conkle. “These are highly motivated and engaged individuals, many of whom have been working together for multiple years within the context of our group. The camaraderie is unreal, and it keeps us on the right path as we continue to grow.” 

Pinecrest Capital Partners served as the exclusive financial advisor to The 20 MSP on the acquisitions. Texas-based Sunflower Bank, acting as sole lead arranger in a syndicated credit facility for The 20 MSP, provided the funding tranche. 

AI in the MSP Space

Part One: Helping Clients

A lot of MSPs have AI on the brain – and how could they not? The AI revolution is for real. And MSPs are uniquely positioned to ride the AI wave and to help their clients do the same.

But figuring out your MSP’s path forward is tricky. Things are unfolding in real time, and they’re unfolding at breakneck speed! If you’re looking for some guidance – some clarity amidst the chaos – you’ve come to the right place.

In this two-part blog (stay tuned for part two), we’re breaking down the state of AI in the MSP space. In this first installment, we’re looking at how MSPs can help clients harness AI effectively and responsibly. Part two will deal with the implementation of AI within your MSP business.

What to Expect (and Not to Expect) from These Articles

If you’re looking for a step-by step, foolproof AI implementation plan, sorry. We’re not withholding such a thing; it just doesn’t exist!

If you’ve been talking to other MSPs or perusing online forums, you’ll have noticed that MSPs are approaching AI very differently – and with very different attitudes. On one end of the spectrum, you have the gung-ho early adopters, and on the other end, you’ve got the skeptics and naysayers.

Most MSPs are somewhere in the middle, trying to make sense of things and chart a course forward. So if you’re excited about AI, but not sure what steps you should be taking, you’re not alone!

And while we can’t give your MSP all the answers in regard to AI adoption and implementation, we can point you in some promising directions, clarify the current lay of the land, and help you start formulating a strategy for your MSP business.

What Makes AI Different – and Right Up MSPs’ Alley

To begin, let’s talk about what makes AI special. It’ll be illuminating to compare it to a recent technological advancement: cloud computing. There are interesting similarities between cloud computing and AI, but we’re going to focus on a key difference:

The benefits and power of AI are obvious, self-evident even. The benefits and cloud computing are not.

As someone who works in IT, you know all too well that moving data to the cloud is, all things being equal, a good idea. You understand how cloud computing offers businesses a more scalable, agile, and cost-effective data storage solution. However, getting your clients to understand this and embrace the cloud is a whole different animal (which is why we have a blog post devoted to the topic).

With AI, the challenge is almost the inverse: clients are going to be eager to adopt AI, since the power of AI is so undeniable, so obvious. A lot of us had a similar experience using ChatGPT for the first time, OpenAI’s groundbreaking Large Language Model (LLM): This thing is incredible! The idea that businesses are going to embrace AI much more quickly and easily than cloud computing isn’t just speculation either:

ChatGPT was the first tech application to acquire 100 million distinct users in just two months. And get this: in a recent survey of 1,000 small business owners, an overwhelming 91% reported increased success following the implementation of AI.

Individuals and organizations will use tools that make their lives easier. Your job, then, as an MSP, isn’t going to be convincing clients to use AI, but rather, helping them do so responsibly, effectively, and efficiently. This brings us to…

MSPs as AI Guides

As an MSP you don’t just ‘fix your clients’ computers.’ You act as a trusted advisor, delivering strategic advice to help clients align their technology investments with their business goals.

If there were ever a perfect opportunity to prove your worth as an advisor, it’s in guiding clients through the adoption of AI technologies. In particular, MSPs should prepare to offer guidance in the following areas:

LLM ‘Tuning’ and Customization

LLMs are incredibly powerful and useful tools, but they’re not one-size-fits-all. The true power of an LLM is unleashed through what is known as “fine-tuning” or simply “tuning”: refining a pre-trained LLM’s capabilities and improving its overall performance by training it on smaller, specialized datasets (i.e., data specific to a client business).

Forward-thinking MSPs are going to master the art of tuning, so that they can equip their clients with LLMs that produce accurate, tone-appropriate content at the click of a few buttons.

But do organizations really need help with this?

Big time! A recent survey from Predibase polled executives, data scientists, developers, and other key decision makers and found that only 11% had successfully fine-tuned an LLM and been satisfied with the results. A whopping 78% had not, with 44% citing “complexity” or a “lack of knowledge” as the reason why. Did someone say, “Golden opportunity for MSPs”?

Data Security

AI introduces a host of new vulnerabilities and data privacy concerns. For instance, if a client is using an LLM, they need to make sure their data is properly organized and tagged.

This is where your MSP can come to the rescue – in helping your clients prepare their data for AI intervention. This means, among other things, structuring their data such that an LLM, or some other AI system, won’t reveal sensitive information to the wrong parties.

And you’d better believe clients are looking for help with data security in AI implementation. The aforementioned Predibase survey found that 33% of respondents listed “giving up access to proprietary data” as a top challenge preventing them from using LLMs in production. This was the most commonly listed top challenge, with second place going to “customization and fine-tuning” at 30%.

So if your MSP can help clients leverage and customize LLMs and other AI tools without compromising data security, it will help you stand out and your clients gain a competitive edge. Win-win!

Microsoft Copilot

Last November, Microsoft made its own AI-powered chatbot available to enterprise customers. Copilot is designed to help businesses enhance productivity and streamline workflows within the Microsoft 365 ecosystem.

MSPs stand to generate some serious revenue by guiding clients through the implementation and management of Copilot. Getting the most out of Microsoft’s new AI tool takes real work: creating a robust data strategy at the outset, ensuring security through proper access controls, and implementing safeguards for long-term maintenance.

But it’s the sort of work for which MSPs are perfectly suited. Learn more about Copilot and the unique opportunity it presents MSPs. Also, check out some of the cool things Zapier is doing with AI Copilot integrations.

The Human Element

AI adoption is a tricky business. There’s no way around that. The technology is new, powerful, and bursting with untapped potential. And because no two businesses share the exact same needs in regard to AI adoption, how well your MSP fulfills its role as trusted advisor will depend largely on one thing:

How well you know your clients’ businesses – how they operate, what they value, and what they’re trying to achieve.

The full force of AI as a business tool stems from the technology’s high level of adaptability and customizability. The only way to tailor an AI strategy to fit your clients’ specific needs is to understand those needs in the first place. Translation: talk to your clients! This isn’t something AI can do for you – not yet at least. It’s a human thing, and it’s crucial to your success as a trusted source of AI wisdom.

Conquer AI through Collaboration

The AI industry is exploding in size and complexity, and MSPs trying to figure things out for themselves have an uphill battle. But imagine being able to tap into the expertise and experiences of hundreds of MSPs, a whole community of companies who share knowledge and tips as freely as old friends trading tales around a campfire…

That’s exactly what it’s like to be a member of The 20 MSP Group. We’re stronger together, and we win together. To learn more about the powerful benefits we bring our MSP members, schedule a call today.

Thanks for reading, and stay tuned for part two, where we’ll look at how your MSP can leverage AI to improve operations and elevate service.

The 20 MSP Announces Triple Play in Strategic Acquisitions 

The 20 MSP closes three new MSP acquisitions, deepens national footprint. 

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Full press release here

PLANO, TX. March 1, 2024 – Leading managed IT services provider, The 20 MSP, today announced its completion of three MSP acquisitions, the latest round of deals in an ongoing M&A growth plan aimed at consolidating the company’s national footprint and enhancing its service offerings. 

The three managed service providers (MSPs) joining The 20 are Drivetech (Massachusetts; President – Bob Falco), Accurate Computer Solutions (Texas; CEO – Rodney Sees), and Blue Cactus Consulting (Arizona; CEO – Wayne Klug). 

As with The 20 MSP’s previous twenty-seven acquisitions, these three MSPs all achieved steady year-on-year growth as members of The 20 MSP Group. The group boasts 150+ MSP members, independent MSPs who leverage shared processes and resources, as well as economies of scale, to get ahead in the competitive managed IT services space and compete at parity with much larger companies. 

The addition of Drivetech, Accurate Computer Solutions, and Blue Cactus Consulting represents another decisive step forward in The 20 MSP’s ambitious growth plans, expanding its client base and deepening expertise across several key areas. 

The 20 MSP’s founder and CEO, Tim Conkle, commented on the significance of these latest deals. 

“With these deals closed, we now have thirty acquisitions under our belt,” Conkle said. “We’ve really hit our stride in terms of making these integrations seamless and minimally disruptive to end clients. As we get bigger and better, our collective knowledge base only gets stronger, so there’s more and more wisdom to draw on as far as making all the pieces fit,” added Conkle. 

The 20 MSP’s unique M&A approach has garnered plenty of industry attention, and as Conkle shared, blazing a trail is standard procedure for him and his team. 

“When I started The 20 MSP Group, I knew we were exploring new territory,” Conkle explained. “Now, we’re embracing the opportunity to once again break ground with our distinctive M&A process.” 

This distinctive process is marked by a commitment to acquiring MSPs that belong to The 20 MSP Group exclusively. As Conkle explained, this strategy capitalizes on the deep relationships The 20 MSP builds with acquisition targets during their time as members. “A lot of the attrition and friction that comes with traditional M&A deals is either minimized or altogether eliminated by our approach,” Conkle said. “So while the pace of our expansion has been rapid, it hasn’t felt rushed, since these integrations solidify partnerships that have been in the works, maturing organically within The 20 MSP Group.“ 

The 20 MSP has a full pipeline of acquisition candidates and more deals planned for the coming months. 

Pinecrest Capital Partners served as the exclusive financial advisor to The 20 MSP on the acquisitions. Texas-based Sunflower Bank, acting as sole lead arranger in a syndicated credit facility for The 20 MSP, provided the funding tranche.   

About The 20 MSP 

The 20 MSP has been helping businesses succeed through better technology since 1986. 

As a leading provider of managed IT services, The 20 MSP serves thousands of businesses nationwide, providing each one with white glove service, secure and streamlined IT infrastructure, and 24/7/365 support. We believe in building lasting relationships with clients founded on trust, communication, and the delivery of high-value services for a fair and predictable price. Our clients’ success is our success, and we are committed to helping each and every organization we serve leverage technology to secure a competitive advantage and achieve new growth. 

Business is better when IT runs smoothly.  

About The 20

The 20 is an exclusive consortium for Managed Service Providers (MSP) aimed at dominating and revolutionizing the IT industry with its standardized all-in-one approach. The 20’s robust RMM, PSA, and documentation platform ensures superior service for its MSPs’ clients utilizing their completely US-based Help Desk and Network Operations Center. Extending beyond proven tools and processes, The 20 touts a proven sales model, a community of industry-leading MSPs, and ultimate scalability. To learn more, visit the20.com.