Nimsoft: Record Managed Services Revenue Continues
Even as some managed service providers begin to feel pressure from the economic slowdown, there are hints that the MSP market continues to generate healthy growth. A key example: Nimsoft, which develops IT performance and availability monitoring solutions, says it generated record Q1 results — including 83 percent recurring revenue growth.
Nimsoft announced the results on May 14, but I sensed another upbeat quarter from the company when I interviewed CEO Gary Read on April 7. Here’s a bit more on Nimsoft’s results, and its meaning to the broader MSP market.
On the one hand, selling into your installed base is typically the easiest way to grow your revenue. However, Nimsoft says its customer base continues to expand rapidly, with new bookings jumping 71 percent compared to Q1 2007. That’s good news, and indicates that customers increasingly understand that MSP platforms can actually save them money.
Still, this isn’t a pure “MSP” success story. Much of Nimsoft’s revenue — by design — involves corporate IT customers. Midsize and large enterprises use Nimsoft’s software as an alternative to traditional system and network management platforms from BMC, CA, Hewlett-Packard and IBM-Tivoli. Nimsoft says it now has more than 640 customers in 30 countries.
Although Nimsoft’s Q1 was extremely strong, MSPmentor has warned managed service providers that they’re not immune to the economic slowdown. During the MSPAlliance’s Managed Services Summit in Atlanta earlier this year, some attendees indicated that sales cycles and billing cycles have become longer in recent months.