Best viewed in landscape
This is the eighth post in this series, if you’ve not read the first post I’d recommend you skim it first for context. As a reminder, here is what I’m covering in this series:
- What is an MSP? – Covered in post 1
- TAM/SAM – Covered in post 1
- Economics of an MSP and their customers – Covered in post 2
- Personas – Covered in post 2
- Vertical analysis-Covered in post 2
- Share of Wallet – Covered in post 2
- The assisted sale – Covered post 3
- Product Penetration Scale – Covered post 3
- Financial Modelling – Covered in post 3
- SaaS metrics – Covered in post 3
- Commercial agreements/billing – Covered in post 4
- Research, Analysts, consultants and forums – Covered in post 5
- Marketing and Shows – Covered in post 5
- RMM’s, PSA’s and integrations – Covered in post 6
- Product capabilities and principles – Covered in post 7
- ‘MSP team’ investment requirements – Covered in this post
- Activity maps and company strategy
- Product management best practices
“MSP Team” investment requirements
Throughout this series, I have touched on many topics that will require resources from finance, sales and marketing to product, engineering and support.
If you decide that targeting the MSP market is the primary focus you will need to assemble a team of resources and set of processes to give yourself the best chances to be successful in your endeavours.
Go-to-Market resources and processes
I’ve seen a myriad of different structures of go-to-market teams who focus on MSP’s, although the service and products you offer have a strong influence on how you support your sales strategy, there are some commonalities among the most successful vendors in this space.
Note. Below illustrates a simplified direct sales approach where your go-to-market efforts focus on engaging with MSP’s directly (not via distribution). I have generalised titles for sales into hunter/farmers as there are probably 10 title variations for each!
| STAGE | DETAILS | RESOURCE |
|---|---|---|
| LEAD | CAN COME FROM ANYWHERE, MANY PURCHASE LISTS WHICH ARE VERY EASY TO GET YOUR HANDS ON. LOOK AT MSPMENTOR FOR THE TOP 501 FOR THE LARGEST MSP’S | MARKETING OR EXTERNAL ‘LEAD LIST’ FIRM |
| MQL (MARKETING QUALIFIED LEAD) | RMM/PSA INBOUND WEB LEADS (DIRECT/INDIRECT) AND SHOWS… A PROSPECT THAT HAS SHOWN AN INTEREST AND IS A GOOD FIT WHICH YOUR LDR HAS HAD A CONVERSATION WITH | MARKETING – LEAD DEVELOPMENT REP (LDR) |
| SALES CALL + DEMO | DEMO’S FROM MY EXPERIENCE DRAMATICALLY INCREASE CONVERSION RATES. YOU’LL WANT TO DO THESE FOR ALL LARGER MSP’S AND AUTOMATE SELF-SERVICE PURCHASE/TRIALS FOR ALL SMALLER ONES | SALES (HUNTERS) – YEP, I THINK ALL REPS SHOULD BE ABLE TO DEMO – NOT JUST RELY ON SALES ENGINEERING (SE) |
| TRIAL + CONVERSION | AIM FOR FULLY SELF-SERVICE TRIALS – BUT MAKE SURE YOU ARE CLOSELY MONITORING ALL STAGES OF THE DEMO AND YOU SHOULD HAVE AUTOMATED DRIP CAMPAIGNS TO MOVE THINGS ALONG POSITIVELY | STAFF UP HERE, YOU WILL NEED SALES (HUNTERS) + SALES ENGINEERING (SE) IF COMMERCIAL OR TECHNICAL QUERIES ARISE. IF THERE ARE ISSUES, SUPPORT REPS WILL BE CALLED UPON TOO |
| EXPANSION + RENEWALS | ONCE YOU HAVE THEM OVER THE LINE, IT’S CRITICAL TO MAXIMISE THE PRODUCT PENETRATION RATES. HOPEFULLY, YOUR WORK WITH INTEGRATING RMM/PSA’S WILL TAKE CARE OF A LOT OF THIS BUT YOU’LL NEED TO MONITOR THIS RELIGIOUSLY! RENEWALS SHOULD BE A NON-EVENT AND YOUR ONGOING VALUE REPORTING SHOULD MINIMISE CHURN RATES | SALES (FARMERS) + SALES ENGINEERING (SE) AUTOMATION SHOULD BE A FOCUS HERE REDUCING THE NEED FOR HUMAN ENGAGEMENT. HOWEVER, MSP’S LOVE TO SPEAK TO VENDORS SO DON’T SKIMP ON THESE RESOURCES |
When working with a distribution channel partner to push your product on your behalf, whether an RMM/PSA, Marketplace or traditional Distributor you’ll have a different structure and process. A clear separation of duties, processes and support will be required to ensure commercial effectiveness.
As much as I’d like to see distributors earn their 20-40% margins, you’ll need to be on hand to get deals over the line and improve on expansion as you’ll be one of many services they will be pushing to their base.
There have been exclusivity deals I’ve worked on where my product would be the sole service within that category via a RMM/PSA, these are rare and come at a price. With exclusivity deals you will need to model this out and ensure necessary protections are in place should you land one.
One last thing on GTM, you’ll need to staff up your team for MSP trade shows which comprise your Sales (Hunters), Sales Engineers and a few marketing folks for logistics. Product management should also be included to help accelerate customer feedback and discovery on an as-needed basis.
Product and Engineering resources
Unfortunately, most organisations underestimate the amount of investment required to serve the MSP from and Product and Engineering perspective.
I have underscored during this series the need for integrations with PSAs/RMMs as well as the general Product Principles/Capabilities your service will need to have, hopefully, you hear this loud and clear and invest appropriately to ensure you avoid some of the pitfalls I’ll highlight here.
Beyond the team who builds out your core service, you will need to think very carefully about how you wish to approach integrations.
I have worked with a few approaches and will lay out the pros and cons:
| APPROACH | PROS | CONS |
|---|---|---|
| USE EXISTING RESOURCES ON CORE PRODUCT TEAM | – NO FURTHER RESOURCE INVESTMENTS REQUIRED – COULD BE THE MOST EFFECTIVE APPROACH IF ONLY DOING ONE BASIC INTEGRATION | – ROADMAP OF CORE SERVICE FEATURES IMPACTED – CONTEXT SWITCHING FOR TEAMS IS VERY INEFFICIENT – MAINTENANCE AND TECH DEBT WILL HAUNT THE TEAM, AND RESOLUTION TIMES WILL BE SLOW – STRETCHES PRODUCT MANAGEMENT TOO FAR TO BE EFFECTIVE |
| BUILD OUT INTERNAL INTEGRATIONS TEAM | – FOCUS ON JUST INTEGRATIONS – MINIMAL CONTEXT SWITCHING – NO IMPACT TO YOUR CORE SERVICE ROADMAP – ABILITY TO QUICKLY REACT TO ISSUES AND CHANGES TO RMM/PSA’S – PRODUCT MANAGEMENT IS MORE EFFECTIVE AS YOU’LL HAVE A DEDICATED ‘PM/PO OF INTEGRATIONS’ | – COST! DEPENDING ON THE NUMBER OF INTEGRATIONS AND THE SPEED OF EXECUTION, THIS CAN BE V HIGH – TEAM RAMP-UP TIME ON UNDERSTANDING RMM/PSA AND BUILDING RELATIONSHIPS – BUILDING INTEGRATIONS INTO THIRD-PARTY SYSTEMS IS NOT YOUR CORE COMPETENCY. IT TAKES INVESTMENT AWAY FROM OTHER THINGS YOU COULD BE DOING TO IMPROVE YOUR CORE SERVICE |
| OUTSOURCE | – NO/MINIMAL FULL-TIME INTERNAL RESOURCES REQUIRED, YOU STILL NEED A PM/PO TO ‘MANAGE INTEGRATIONS’ AND QA TO TEST INTEGRATIONS ONCE SHIPPED TO YOU THOUGH – THEY CAN OFFER GREAT ADVICE ON WHAT WORKS BEST FOR YOUR TYPE OF SERVICE, DRAMATICALLY INCREASING THE CHANCES OF PRODUCT/MARKET FIT (PMF) AND REDUCING TIME TO MARKET – THEY OFTEN HAVE A CLOSE RELATIONSHIP WITH THE RMM/PSA’S SO ARE AWARE OF CHANGES/ROADMAP – COST TYPICALLY WORKS OUT LESS THAN BUILDING OUT YOUR OWN TEAM | – FINDING GOOD/RELIABLE RMM/PSA INTEGRATION SPECIALISTS – LIKELY TO NEED MULTIPLE FIRMS TO WORK WITH GIVEN THEY TYPICALLY FOCUS ON A COUPLE OF RMM/PSA’S ONLY – ENGINEERING BEST PRACTICES AND SECURITY STANDARDS WILL DIFFER FROM YOURS |
Quantifying the costs can be challenging if you are new to MSP’s, you must figure out how broad and deep you need to go and avoid diminishing returns by focusing on what is truly needed to support your strategy and the MSP needs.
