This is what the IT industry has been waiting for: The 2023 Channel Futures 2023 MSP 501 ranking of the best managed service providers in the world.

Jeff O'Heir

June 20, 2023

10 Min Read
Trophy and MSP 501 winners logo
Noey smiley/Shutterstock

For MSPs around the world, 2022 was one of the most pivotal years in the last decade. As the worst of the pandemic ebbed, SMB technology spending flowed. The new legion of hybrid workers embraced the benefits of cloud computing, while their bosses gained a greater appreciation for security solutions. Automation and AI technologies emerged. M&A activity burned white-hot. MSPs who proved their value as essential frontline workers grew even more important to clients as trusted business and technology advisors.

The 2023 Channel Futures MSP 501 ranking of the best managed service providers in the world celebrates the strengths of those MSPs and their abilities to thrive in a tumultuous economy and uncertain business environment.

How the MSP 501 Winners Qualified

For first time, Channel Futures was able to capture just how profitable it is to deliver managed services through the collection of earnings before interest, taxes, depreciation and amortization — better known as EBITDA, a widely used measure of corporate profitability. It is the first time in the history of the Channel Futures MSP 501 such information was collected as past applicants provided gross profit or gross profit margins. With EBITDA being the currency of M&A and considered the most important measurement of bottom-line performance, we added it to this year’s application form — the first for any technology publication.

The 2023 Channel Futures MSP 501 winners have been revealed! Get started here.

This year’s survey, like every Channel Futures MSP 501 before it, continues to evolve into much more than a ranking. It uses key data on the state of the MSP market during 2022 to highlight the solutions, sales and marketing strategies; operational improvements; and customer trends that are driving growth today. The following dissection of the results shows how important the last 18 months will be for the future of the IT industry and the monumental role MSPs have in shaping it.

Let us be the first to congratulate this year’s Channel Futures MSP 501 winners and for all they did to make 2022 the technology solutions steppingstone that is launching their clients into the future.


Ensono’s Brian Klingbeil

“2022 was absolutely a pivotal year for that,” said Brian Klingbeil, chief strategy officer at Ensono, which ranked very high again on this year’s Channel Futures MSP 501. “When confronted with extreme circumstances, people will shift. That’s when change takes hold.”

The impact of those changes pushed a constant trend in the channel to new levels.


Meriplex’s Neil Medwed

“In many ways, it forced MSPs to run a better business,” said Neil Medwed, vice president of corporate development and M&A at Meriplex, which jumped into the top 50, from No. 91 last year. “2022 was pivotal in a few different ways. During COVID, the MSP marketplace was relied heavily upon to navigate this new normal. All of a sudden it’s, ‘What do we do? How do we adjust quickly from the in-office workspace to a hybrid workspace?’ That brought a lot of benefits to many MSPs.”

MSPs on this year’s Channel Futures MSP 501 list prove they learned their lessons well.  In its 17th year, the list ranks companies on annual revenue, which was weighted heavily toward managed and professional services. Judging was also based on EBITDA, recurring revenue and revenue per employee. None of those numbers would exist without the hard work, business acumen, market savvy and technological innovation of every team member that makes up the MSP 501 Class of 2023.

The numbers prove congratulations are in order. Here’s a rundown of the key findings:

  • Aggregate Revenue of the 501ers: $13.8 billion.

  • Average Revenue Per MSP 501er: $27.5 million for a 25% year-over-year increase; Median: $6.67 million for a 17% increase.

  • Average Total Recurring Revenue from Managed Services: $16.7 million, a 33% increase; Median: $4 million, a 21% increase.

  • Average EBITDA Profit Margin: 13%.

  • EBITDA Growth Year Over Year: 35%.

  • Total Employment: 100,571; Median of 32 employees per company

  • Business ownership type remains consistent with last year: Minority-owned, women-owned and millennial-owned, 8%; Veteran-owned, 5%.

  • 369 of this year’s 501ers are repeat winners from last year.

That’s just scratching the surface of data collected from the survey. During the next several months, Channel Futures will post derivative lists that include top-performing 501ers in security and cloud; women-, veteran- and minority-owned MSPs; breakdowns of the regional players; and a reveal of the NextGen 101ers. Those are the up-and-coming MSPs scoring big with …

… innovative solutions and new sales and marketing strategies.

The main report and breakout lists strive to provide an accurate picture of the health of MSPs; the primary solutions they’re selling and those that yield the most revenue; top growth areas; industries served; M&A activity; client and technology trends; and EBITDA per employee, to name a few. MSPs use the list to compare their businesses to others. They successfully market their status as a qualified 501er and to clients, using the award and sales and marketing collateral they receive as part of their winner’s package. The award is also a powerful team builder and hiring tool, MSPs said.


PCH Technologies’ Timothy Guim

“It’s industry recognition, validation of the work that we’re doing throughout the year. It’s also great team-building for us,” said Tim Guim, CEO and president of PCH Technologies in greater Philadelphia. “Everybody on the team knows that we’re working toward something: We’re one of the top 501 MSPs in the world.”

Vendors and distributors, on the other hand, covet the list and data as a valuable tool to find strong partners, forecast sales and create yearly go-to market strategies.

The 2023 Channel Futures MSP 501 winners have been revealed! Get started here.

“Vendors want to double down on high-growth partners, and the MSP community at large is a growth engine. So it’s logical that our vendor partners are interested in those partners that are growing, operationally mature, investing in their business and achieving results,” said Paul Hager, vice president of services at Ingram Micro. “That’s the 501 right there. The report calls out the actual results of all that work.”

The Results: Security Rules, Other Top Revenue Drivers and Hot Services

Security was the big story in ’22 and will continue to be for years to come. Ninety-eight percent of the 501ers offer managed security services, with 71% saying it was their top revenue-producing managed service, tied with help desk/service desk. The other managed service top-revenue drivers were remote monitoring (servers, desktops, laptops, networks), 25%; infrastructure as a service, 23%; and business continuity, 22%.

501ers expect the momentum of those service sales to continue. Eighty-eight percent projected managed security would be their biggest growth area in 2023. They expected managed compliance services to grow at 29% and business continuity at 26%. They projected that the other service in the group, infrastructure as a service, would grow at 28%.

On average, 51% of the 501ers’ revenue came from managed services, 15% from non-recurring rev hardware, 12% from professional services/project work and 12% recurring cloud services, including licensing from AWS, Google and Digital Ocean). About half (50%) of the business software they managed was in the cloud, 36% both on-prem and in the cloud, and 12% on-prem, a 2% decrease from last year.

However you slice the data, security was the big number and story in 2022.. The 501ers have been predicting and preparing for that growth for years.

Anthony Oren, CEO of Nero Consulting in New York City, started building out his company’s security offerings in 2016 after many of his customers became concerned with Russia’s interference in the presidential election. The Nero team constantly studies the foundations, frameworks, best practices and trends to create the best security policies and postures for clients.


Nero Consulting’s Anthony Oren

“I feel like I’m differentiating my company as a whole,” said Oren, whose company made a huge leap into the top 50 this year, up from No. 55 on last year’s NextGen 101 list, due in large part to his ongoing focus on security. “Over the next couple of years there’s going to be a big separation between the companies that are really doing security and the ones that are just faking it.”

Almost every customer conversation today focuses on …
… security, 501ers said. But, as a reflection of today’s uncertain economy that has customers clinging tightly to their checkbooks, another key word has entered the conversation.

Brian Klingbeil runs Ensono’s client advisory board, made up of the company’s 15 top clients. Until the beginning of this year, they’ve been telling Klingbeil they need Ensono to be proactive in showing them how to optimize what he calls “the four horsemen of the apocalypse”: cost, security, performance and resiliency. That changed at the beginning of this year.

“The way my clients rank those four things right now are cost, cost, cost and security, in that order,” he said. “You have to do all four, but there’s a lot of emphasis on cost.”

Recurring Revenue Is King; Hiring Was the Wild Card

Next to the 35% increase in EBITDA, the 33% increase in total recurring revenue represents one of the biggest jumps in the survey.  501ers say it’s only going to increase.


Velocity IT’s Kenny Riley

“It’s the only way; that’s the lifeline of our business,” said Kenny Riley, information technology services manager at Velocity IT in Dallas. “MRR is king over everything else because it allows us access to better vendors, to provide a higher level of service, to hire better talent, to keep people employed.”

Hiring new talent was one of the most difficult things the entire IT industry faced in 2022. Despite that challenge, 501ers had an average of 201 full-time employees, a 26% year-over-year jump, and a median of 32, a 14% jump. More than 85% of 501ers added employees through new hires, a 72% increase over the previous year. Adding headcount through new hires and M&A increased by 14%.

Many 501ers said investing in hiring was the smartest thing they did in 2022. PCH’s Guim sat down with his head of marketing and created a full marketing strategy tied tightly to social media. It worked.

“That’s the No. 1 that changed the game for us, because our business is built on our team,” he said.

The 2023 Channel Futures MSP 501 winners have been revealed! Get started here.

Meriplex invested heavily in sales, one of the most “effective” moves the company made in 2022.

“Many organizations cut back. We invested in quality salespeople,” Meriplex’s Medwed said.

The MSP also invested heavily in operations “to improve the customer experience and help them grow,” he added.

Device Management Skyrockets, an Industry Grounded in Customer Service

Setting up and servicing remote workers was a boon to 501ers. While the year-over-year growth of customer contracts remained unchanged at 11%, the amount of customer end users more than doubled to 27%. Growth in the number of managed end-user devices nearly quadrupled to 40% – from 11% – while growth in contracted virtual machines leaped to 38% — from 14%. Anthony Oren of Nero knows the reason.

“We started managing two offices, one in the home and one in the actual office. Essentially, that led to double billing. We charge by device,” he said. “That was a huge advantage to our revenue, as well as upselling security.”

The most advanced technologies and sophisticated solutions mean nothing unless they are backed by great customer service. That’s one area Channel Futures doesn’t directly track through the Channel Futures MSP 501 survey. It doesn’t have to. No MSP would be on the list without making customers the top priority.

“We’re in a huge market. MSPs are a dime a dozen. The No. 1 reason we outperform them boils down to service delivery, technical aptitude and having that personal rapport with the customer,” Velocity IT’s Kenny Riley said.  “It’s understanding what their fears are, what do they want to address. It’s making sure they can rest easy knowing that the security of their business is properly handled so they can focus on the other things.”

Have any thoughts on the MSP 501 list? Want to apply to next year’s list? Email Jeff O’Heir or connect with him on LinkedIn.



About the Author(s)

Jeff O'Heir

Jeff O’Heir is a journalist and editor who has spent much of his career covering the business leaders, issues and trends that define the IT and consumer technology channels. His work in print, online and on stage has showcased, educated and connected small and large solution providers, MSPs, channel pros and vendors. During his career, Jeff has also covered engineering technologies and breakthroughs, crime, politics, food and the arts.

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