Network Depot LLC, ranked No. 75 in last year's MSPmentor 100 survey, is transforming itself into a Master MSP. The company has introduced a hosted Kaseya platform, known as Virtual Administrator, that small VARs can leverage.
Hosting managed services for other VARs is part of a growing trend across the MSP landscape. But in addition to offering new revenue opportunities, becoming a Master MSP also involves some challenges.
The UpsideFirst, the good news: Roughly 15 percent of the MSPs that have completed our current MSPmentor 100 survey (yes, you can participate too) are hosting services for peer VARs. That suggests a growing level of trust between MSPs and VARs -- which should lead to more reliable, more comprehensive solutions for customers.
Also, Master MSPs can scale their business quickly by sitting closer to the top of the managed services pyramid. Revenue from VARs -- who, in turn, collect monthly fees from end-customers -- flows in every month.
The Master MSP model has attacted some rather innovative competitors -- including smaller firms like Do IT Smarter and MSPSN, and larger organizations like Ingram Micro's Seismic team. Other key Master MSPs include ATS Managed Services; Brookland Computer Services of Surry, England; and NetEnrich.
The ChallengesStill, the Master MSP market is getting crowded.
- Dell is moving in and plans to offer hosted Silverback, Everdream and perhaps even MessageOne services to VARs and MSPs.
- Startups such as MSP Warehouse (from the folks who launched Secure My Company) are quietly formulating comprehensive hosting strategies.
- And MSP platform providers themselves are introducing complementary managed services to assist their VAR and MSP partners. A prime example is Kaseya's NOC Assist effort.
When I hear about Master MSPs, I'm reminded of Yogi Berra's famous quote about a St. Louis restaurant: "Nobody goes there anymore. It's too crowded."
Similarly, I sense the Master MSP market will fill up fast, too. But it's hard to argue with the upside for getting in the market now.
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