Backed by VCs

“I’ll use the company Electric AI as an example. They have made a lot of noise in the industry. They are actually a VC-backed MSP, and have raised something around $70 million to date. That’s a lot of money for an MSP in New York City, so we run into them a lot. And their value proposition is that they bring AI and automation into the MSP space. Obviously AI is a big buzzword in automation, so they claim that they’re able to charge significantly less than your typical MSP and leverage this proprietary automation that they have.

“The reality is that you can’t really automate a lot of this stuff. But they’re able to charge a third of what the industry rate is. Not because it’s profitable for them, but because they have $70 million from these VCs. So that’s an interesting challenge that we’re seeing in the New York market in the MSP center of competition.”

—Joseph Rabinowitz