ConnectWise CEO: How MSPs Can Thrive As Vendor Clouds Target SMBs

At the ConnectWise IT Nation conference in Orlando, CEO Arnie Bellini outlined a vision to help MSPs, VARs and IT service providers succeed as cloud computing hype grows. Bellini’s key points focused on defending your business from major SaaS and cloud companies that plan to sell direct to SMBs. Plus, Bellini described how solutions providers can build closer SMB customer relationships that generate new revenue opportunities. Here are 15 highlights from the keynote — including key thoughts on coopetition (cooperating and competing) in the MSP software market.

1. Looking Back: In 1919, Bellini’s grandfather came over from Italy and landed his first job at the Waldorf Astoria hotel as a busboy. The ConnectWise IT Nation conference is being hosted at the Waldorf. Bellini’s grandfather went on to open a bakery… beginning the entrepreneurial trend within the Bellini family, he noted.

2. The Last Mile: Bellini kicked off his business thoughts by recapping the Last Mile of IT. The background: Big IT vendors traditionally leveraged solutions providers to reach the last mile of IT — small business customers. But that’s changing, as vendors push from the last mile to the last yard, because big vendors are using the cloud to float solutions directly over the SMB client base. “I’m not getting on the vendors for doing this, but at the same time we should have great concerns,” said Bellini.

The big question: Will solutions providers lose their SMB clients? Bellini says he’ll offer some messages of hope and key strategies for success. (No surprise: Read this entire blog for those ideas.)

4. The Key to Success: Create relationships with vendors so that you don’t lose relationships with SMB customers. “The relationships have to still come through us,” said Bellini. “It’s simpler than we all think.”

5. Build The Modern Office: ConnectWise is calling on solutions providers to “build the modern office” to maintain customer control. The good news: The economic bounce back is real, asserts Bellini, and SMBs are completely open to outsourcing conversations. “You really want to plant that in your brain when you get scared: Small business is willing to outsource. They want to work with other small businesses.” Also, small businesses want instant gratification… so SMBs are not willing to wait for traditional IT resolution times, asserted Bellini.

6. Balanced Messaging: Instead of pumping LabTech Software (a ConnectWise Capital investment), Bellini specifically called on MSPs to explore a range of RMM (remote monitoring and management) options out there because there are a range of solutions that can help MSPs to remotely manage SMBs.

7. Sales Opportunities In the Cloud Age: So, what should solutions providers sell as the cloud takes hold? Bellini offered a lengthy list of recommendations.

• Shift from traditional hardware to hardware as a service (HaaS)
• Push beyond software to software as a service. “Google is willing to work with us and through us” on SaaS, Bellini asserted, an apparent tip of the hat to the Google Apps Reseller program.
• Professional services.
• Storage, backup and disaster recovery services.
• Email management and administration.
• Website management. “Websites have always been a cloud solution,” said Bellini. “It’s another way for you to make money.”
• Remote monitoring and automation. “We can take care of 70 percent of their problems remotely and give SMBs instant gratification” when IT or business issues pop up.
• Help Desk: “This is near and dear to my heart,” said Bellini. “If you a good RMM and automation tool and a good help-desk function you can really take control of your clients. We all worry about the cloud and control of those clients. More than any other area of your business make sure you have help desk functions.” The average help-desk technician manages about 15 tickets per day. Build processes, using a dispatcher, to pick and choose which tickets to manage first, Bellini asserted.
• Voice over IP: “Here’s the thing about what’s kind of cool in this industry… everything is going digital, everything is data, everything is going across the Internet,” said Bellini. “All of that is just servers and endpoints. The phone is the endpoint.” Control that phone relationship, even as PBXes shift to the cloud.
• Mobile: A new wireless standard will push 50Gbps “That’s going to change everything,” said Bellini. “Google’s mission is writing everything for mobile first. More searches are now happening through mobile. It’s bypassing desktop searches. Mobile is a cloud-based service.
• Security
• Telecommuting: We’ve all got clients that have employees who work from home or remote offices where two or three people work. Embrace opportunities, Bellini said.
• Telepresence: Zenith has a brand new offering (Vu TelePresence) which is designed a monthly service. “That’s another thing for your bag of tricks.”
• Digital Signage: “It’s another PC… another end point that you can grab.”
• Vendor Management: Take control of customer relationships with phone companies, copier companies, broadband companies. We’re all doing that management and we’re not taking control of it. Focus on vendor management and take control of that client’s data infrastructure. Customers want to deal with one person. Who do you want that one person to be? Add $99 a month for managing that account. That’s $1,200 a year for every customer. Do the math; it’s a lot of money,” asserted Bellini.
• Printer Management: :”It’s not sexy but who’s doing it?” said Bellini. He pointed to Xerox PagePack as a managed print service that MSPs should explore. “Print management is an incredibly profitable area; it’s just not boring; it’s not sexy. Printers will always be under your customer roof. Manage them.”
• Surveillance: “These are just IP cameras that go back to a centralized server. It’s not rocket science.”
• Co-managed IT: “Our answer for that is ConnectWise Streamline IT,” said Bellini. Formerly called Downstream IT.
• Cloud Services: The last item of Bellini’s list was cloud services. “This is the thing that people are most concerned about.” But instead of getting concerned, review the list above and focus on at least four or more of the opportunities, asserted Bellini.

Bottom line: Bellini’s modern office vision is the clearest, best-defined list of potential opportunities awaiting solutions providers within the cloud age. “As long as there are people under the SMB roof, you’re not going to have an issue,” said Bellini. “Get as many anchor points as you can in that modern office and you’ll be in good shape.”

And as SMBs shift some IT services to the cloud, Bellini stands ready. Apparently, ConnectWise has trademarked  the term “The Cloud Office.” Stay tuned.

8. Where ConnectWise Will Assist: “If you don’t do anything else, take control of help desk and vendor management.” Also of note, ConnectWise has built ConnectWise Blueprints to help partners build business processes. ConnectWise University has been redesigned with gadgets (i.e., widgets) that you can plug into your dashboard. Also, ConnectWise Consulting ($150 per hour) can help partners improve process flow and streamline business. There’s also an enhancement forum — similar to Dell IdeaStorm — where partners can vote on ConnectWise improvements. Enhancements like automatic spell checking in service tickets came from the enhancement forum.

9. Browser and Mobile Agnostic: Bellini noted that ConnectWise is now in beta on multiple browsers beyond Internet Explorer. He pointed to FireFox, Google Chrome and Safari as current betas. In the mobile market, ConnectWise is focusing on iPhones, Windows Phones and Android.

10. Mature Community: Within ConnectWise’s partner/customer base, 59 percent of companies have been in business more than 10 years. Another 24 percent of partners/customers have been in business six to 10 years. Sure, there are plenty of start-up MSPs and IT service providers. But there are plenty of mature players too, noted Bellini.

11. Revenue Mix: Within the ConnectWise customer/partner base, IT service providers generate 37 percent of their revenues from managed services and 22 percent from break-fix. Bellini said break-fix isn’t going away. He also noted that only 3 percent of partner revenue currently comes from cloud-based services.

12. Feeling Upbeat: 54 percent of ConnectWise’s partner/customer base expects to generate at least moderate growth or better this year.

13. Referral Fees for Partners: ConnectWise is paying partners to refer new partners/customers into the ConnectWise customer base. The link for the referral process is http://www.ConnectWise.com.refer.

14. Ratings and Rankings: Bellini shared some partner feedback data, which revealed how customers and partners.

15. ConnectWise Capital Investments: Bellini briefly described how and why ConnectWise Capital has been making investments in companies like CharTec and LabTech Software. “We’ve taken a little heat for our investment in LabTech,” conceded Bellini. “But I’m here to say we’re working very hard with, say, Level Platforms [on integration]. We have very good relationships with N-able. We work with Kaseya; they don’t write to our APIs [but we work with them].”

Bellini Added: “…If we can make you more profitable and efficient there’s not a problem with competition. We’re about open competition. There will be no closed APIs. We’re saying use any RMM solution. It’s about having more choice. Not less choice.”

Next Moves

MSPmentor continues to report live from the IT Nation conference. Check back for multiple daily updates.

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