MSPs Overcome Small Hurdles to Raise The Bar

Managed Service Providers face a series of challenges when they are first getting started, and I  often see their team members reaching out to more experienced colleagues for advice. Honestly, that is a great idea. But there is one concerning trend that I’ve noticed again and again while looking through the MSP forums in Reddit, Discord, Spiceworks, etc. I always seem to run across a recurring statement with a subject line like “Up and coming to MSP, looking for advice”.
Inevitably, it is followed by a statement that looks something like this:

After years of working for others, I'm working towards starting my own MSP business. As with most upstart businesses, I don't have a lot of capital to work with. Obviously, in order to sell products and subscriptions, I need products to sell and must have relationships with vendor partners. Common sense dictates that in the current era, Office 365, a PSA/RMM solution, a Backup solution, and an A/V solution are must have’s. In addition, other things we might want include...
- Anonymous Newbie MSP

Getting right to the point, I’ve noticed that in many online MSP communities, a lot of newcomers list out all the nice-to-haves in addition to their must-haves. It makes sense to be thorough and forward-thinking, especially when you’re excited about building a modern service stack.

Don't forget, we're talking about New MSPs

But we shouldn’t forget that we’re talking about a new MSP with a likely small customer base, limited operational capacity, and a constrained budget. The very first set of hurdles they’ve set to start this business is so daunting—right out of the gate. In my experience helping hundreds of MSPs kick off their businesses, setting initial goals appropriately and right-sizing those early decisions is one of the keys to achieving long-term, sustainable success.

Consider everything that a business needs to flourish in the early years: sales, marketing, service delivery, documentation, tooling, and processes that still need to mature. Those switching from a VAR model have a business model transition to complete as well, often while still supporting existing customers. Yet so many MSPs step into this market while immediately stretching themselves too thin. Are all of the things listed important? Certainly. Many of them will become essential later on. But a budding MSP faces the real possibility of going down that rabbit hole of having too many offerings and quickly running out of capital and time.

Additional offerings mean more complex billing workflows. They mean more technologies to support, more staff training, more processes to maintain, and more vendor relationships to juggle. Every new tool adds another portal to log into, another set of updates to track, and another support channel to manage. I’ve spoken with MSPs who are offering four or five backup solutions alone! Imagine the added stress—both financial and operational—of trying to fulfill so many contracts and SLAs as a new business that’s still trying to establish its reputation and internal structure.

Set Realistic Goals as a New MSP

New MSPs need to set realistic goals. Start with these 4 steps:

1. Review our guide for MSP best practices.
   
   
2. Carefully consider what service(s) you’d like to focus on, and define it clearly. This may mean starting with a single offering like Backup as a Service.
   
   
3. Take a rifle-shot approach rather than a shotgun approach to training. By focusing on fewer technologies, you become an expert and help to differentiate yourself from the pack.
   
   
4. Choose the right vendor-partner relationship. Much like other aspects of life, juggling multiple relationships can be a challenge. Do your homework to understand who you’re getting involved with upfront. Not just software trials, but support, billing, and everything about the company.

Starting a new MSP in today’s landscape is an exciting endeavor that will no doubt involve a few bumps in the road. But businesses that give themselves realistic goals in the beginning position themselves for a more strategic expansion of services that will lead to success in the marketplace.