Micro MSPs: Carving Out Their Own Cloud Niches?
When it comes to the IT channel, sometimes the media — MSPmentor included — is guilty of focusing too much on massive VARs and MSPs. Meanwhile, there are thousands of micro MSPs (sub $1 million annual recurring revenues) navigating the SMB market. Can those micro MSPs thrive as big vendors promote SMB cloud solutions?
That question popped into my head when I head about Stuart Selbst Consulting’s latest coaching effort. It’s called SMB Power Teams — a type of peer group comprising up to six business owners. Yes, the peer group model is getting crowded in the IT channel. But Selbst has two unique twists: The SMB Power Teams peer groups will be virtual, and they’re designed for MSPs with under $500,000 in annual revenues.
In addition to the virtual gatherings, SMB Power Teams members will meet twice annually. It sounds like Selbst is partnering up with Stuart Crawford of Ulistic (an MSP marketing and SEO business) and SMB Technology Network — an association of SMB IT service providers.
Will SMB Power Teams succeed or fail? I have no idea. But Selbst has decided to focus on an under-served portion of the IT channel. Generally speaking, MSPmentor spends a lot of time trying to help MSPs drive far beyond $1 million in annual recurring revenues — pushing toward $5 million, $10 million or more. We sometimes blog too much about growth and exit strategies, while some MSPs simply want to run profitable lifestyle businesses.
Elsewhere, channel sites like CRN offer advice on how to become a $100 million VAR. But that’s not relevant to 99.970% of readers. If there are roughly 100,000 VARs in North America, only about 300 generate $100 million in annual revenues — and a big portion of them are vendors’ consulting divisions — names like IBM Global Services and HP Services.
Meanwhile, there are thousands of Micro MSPs and small resellers serving the channel. And many of them are trying to figure out how to remain relevant as new services like Microsoft Office 365 near launch. The Micro MSPs don’t have enough budget or time to build out their own clouds. And some cloud reseller programs reduce “partners” to order takers rather than strategic advisors. I wonder: Can Selbst and other coaches help the Micro MSPs navigate the opportunities and challenge ahead?