Nimsoft Confirms Speculation: Another Record Quarter
And that's good news for the broader managed services market.
Nimsoft CEO Gary Read back on July 7 hinted that the managed service platform provider had just completed another record quarter. Apparently, Read wasn’t exaggerating the situation.
And that’s good news for the broader managed services market.
According to a press release dated July 23, Nimsoft:
- Generated record financial results for the three months ending June 30, 2008.
- Recurring revenues grew 130 percent year over year while order backlog increased more than 75 percent over the same quarter last year.
- Overall bookings grew more than 85 percent as the company announced a record 41 new enterprise and MSP customers
- Nimsoft’s total customer base now exceeds 680 MSPs and corporate IT customers in 30 countries.
As a privately held company, Nimsoft doesn’t have to disclose its financial results. But the company has made a habit of sharing a few pieces of financial information each quarter. And in his personal blog, CEO Gary Read often pulls back Nimsoft’s financial curtain a bit.
Other privately held MSP platform providers are weighing if — or how — they should discussion financial momentum to customers. Kaseya, for one, just completed a strong quarter according to sources close to the company. However, Kaseya has avoided the temptation to toot its own horn this quarter.
Joe,
It would be interesting to hear from Managed Service Providers if they too are having record quarters. Or is this like the Levi Strauss’s of the Gold Rush era?
Nick: Agreed fully. We’ll start to get some data in September, when we launch the annual MSPmentor 100 survey. I will be able to share some anecdotal info from that rather quickly. Also, we’ll be announcing some other developments soon that could provide more info about MSP sales and revenue trends. I expect to share that info in a week or two.
How are things with you? I’m hearing from some MSPs who say their sales cycles are getting longer…
We’d be happy to offer a couple observations:
1) IT spending among our customer base does not seem affected by the larger economy, however the majority of our customer base is still located in Washington, DC which seems to be recession proof. Thank you Uncle Sam!
2) We definitely see Managed Services 2.0 (unlimited support models) as becoming the new standard. We conduct a monthly analysis on our markets, basically we run a Google ads word search using popular search terms from potential customers. We then look to see who is competing and what their offering. We started this in 2006. In 2006, we saw 90% of the ads as local competition and only 15% offering a form of Managed Services. Today we see roughly 50% of the competitors advertising as national or regional competition. We also see 90%+ offering some form of Managed Services, with at least half offering unlimited support models. Translation = Managed Services with its remote nature eliminates barriers for competitors to offer their services in new markets.
3) We have not seen our sales cycles extend, largely because of our service model. We have gateway products/services that allow customers to get into the door quickly without having to go through an extended process (audit/compliance check). Once their in the door, we can always move them to a more complex, higher monthly reoccurring plan, if they qualify…
FYI, I’m not picking on Nimsoft or any other MSP Platform. Its just apparent that these companies are outperforming the individual service providers.
Reason? They have a product/service that is standardized, scalable, and profitable with every client.
MSPs do not have that luxury with 2.0 services. So in essence, it feels like the Gold Rush. MSPs are out there hoping to find gold and a few of us have invented processes, tools, and large scale operations to achieve that, however the smart guys/gals are the ones supplying us…
I’m very optimistic about the opportunities for Managed Service Providers despite the outlook above, however I think our real opportunity will be to adapt and address the issue of ownership. It is possible for an MSP to create a model that is scalable, profitable, and standardized. We believe it lies in evolving our service offering to the next natural step, IT as a Service.
Hi Bart,
I’ve reached out to Nimsoft for comment. On the one hand, we welcome reader comments and we strive to ensure the site remains interactive. But on the other hand, we do consider comments to be unconfirmed speculation. I’ll be sure to let readers know if/when we have a comment from Nimsoft.
-jp