While 2020 has been a hideous year for most, it has generally been a good year for many MSPs’ bottom lines, if not their work-life balance. John Pagliuca gives his assessment of the year, and what the company – whatever it is called after the impending spinoff – will be doing for MSPs in the year ahead.
On Thursday, SolarWinds MSP hosted an online All Partners Meeting, where they provided a business update, which included the impending spinoff from SolarWinds, as well as the company’s technology and enablement roadmaps for the year ahead.
In the wake of SolarWinds filing the previous day with the SEC to declare its intent around the spinoff, SolarWinds MSP President John Pagliuca told his MSP audience what this means for them.
“We actually just crossed an important milestone when we filed earlier this week with the SEC our Form 10, which is that registration process where we begin to start that process on the spin,” he said. “That’s pretty significant. It doesn’t mean it’s done, and it doesn’t mean we’ve spun, but it’s an important milestone where we are actually telling the SEC our intentions a little bit more formally.”
Pagliuca communicated that it is certainly more a question of when rather than if it happens, however. He noted that the team has been working hard on a new web site, that the management team will be the same going forward, and that the new company name remains shrouded in mystery for now.
“My number one priority on the spin is making sure we give world class customer success, offerings and support to our partners,” he stated. “We are expecting that to be complete by the early part of 2021.”
Pagliuca said that their spinoff, the Datto IPO, and the strong trend of M&As in the MSP industry attest to the industry’s health.
“It’s a general nod or realization of the health and potential the MSP community has,” he said. “It reflects the fact that we’ve now gone from this break-fix model to more of a proactive model, where we are not just doing IT, we are helping with business management. The MSPs are now that trusted advisor.”
Pagliuca noted that the pivot to the model of a recurring revenue stream had been a game-changer for the industry.
“If it’s recurring and it’s predictable, that means you can raise debt, and go buy another company or increase your investment by leveraging a financial institute,” he said. “All these indicators are really healthy. People sometimes think debt is a four letter dirty word. It’s not. Using debt the right way is just really a good way to help you along your journey and help you grow.”
Pagliuca also emphasized how MSPs are also transforming their businesses to implement practices and do new things in order to keep up with customer needs today. He noted that their Advisory Council of 40 MSPs, in discussing their pressure points, said that they were challenged by the massive change in the surface area that can be attacked as companies expanded from the office and a specific network infrastructure to employee homes.
“The bigger the surface areas, the more areas bad guys can get at,” he said. “The second problem is that folks also need access to the data and the workflows that they had before. And the third is collaboration. We are seeing MSPs have to transform to help with these three areas as the surface area is different.” The result has been that MSPs are doing things now they would not do in the past, like supporting a WiFi AP in someone’s home, in order to do the right thing for their SMB customers.
Collaboration has become an ever more important element of SolarWinds MSP’s own ecosystem strategy.
“Our ecosystem is effectively a three-pronged approach, and we need to do a better job promoting it,” Pagliuca said.
The first is the Technology Alliance Program, which was greatly strengthened in 2020.
“We have added over 25 vendors just this year alone – Huntress, Kaspersky, ConnectWise,” Pagliuca noted. “We have alliances so MSPs can leverage the data and not have to waste a lot of time with mundane tasks. We have these APIs and connectors. We made a big push in 2020, by far our biggest improvement in terms as far as how many other technologies we attach.”
The second category is OEM arrangements.
“With these, we go a little bit deeper on the integration and we give those MSPs the power of the platform, allowing them to take enterprise grade bits like SentinelOne, like BitDefender, like TeamViewer, bring it into our platform so they get the best of both worlds, and they have something that’s purpose-built for the MSP, but enterprise grade.”
Enterprise alliances, the third group, also saw an intensification in 2020.
“We made a big push on the enterprise side, where Cisco, Microsoft and Apple started knocking on our door to see how we and the MSPs can help them manage many-to-one,” Pagliuca said. “MSPs can manage everything, and we can help them be a little more efficient so they can help their SMEs do their jobs successfully.”
While Mav Turner, the Head of Product, discussed the technology roadmap separately, Pagliuca pointed out that SolarWinds MSP had stepped up their MSP enablement efforts in 2020.
“Our mission is simple – to fuel success of MSPs to help SMEs,” he said. “That’s been true for almost 20 years. We have this MSP Institute. I hope our MSPs are leveraging that. We have over 48,000 course completions. We have our Head Nerds. These Head Nerds are folks who are in industry, who have been there, who have sat in the seat of the MSPs. They are helping in automation and with backup and security. We have close to 4500 boot camp attendees where you go deep – for novices to experts. This is all free. We also added more customer success folks for more personal one on one conversations with partners. Hopefully folks felt it in 2020, I promise them they will feel it even more in 2021, and will feel it in a bunch of different dimensions.”
The customer success efforts are new, and were launched earlier this year because of the realization that the area was a sore spot with MSPs. It was announced in January, and the teams have been active since July.
“Launching a customer services organization during a pandemic isn’t something you would normally do, but it was fitting because we were able to come in and help partners,” said Neil McIntosh, Senior Director of Customer Success.
“It was painful to hear we were one of those companies that were difficult to do business with,” he said. “We don’t want to be one of those companies. The reality was that many of our partners have had a bad experience. We want to make sure the customer success team is there for you. Our fantastic resources were not as well-known as expected among partners. You get access to these. Our CSMs [Customer Success Managers] will work with partners to guide them through the resources.”
“For many of our partners, it has been more difficult than it should be to do business with us,” said T.J. Letourneau, Director of Customer Success. “The top example that comes to mind for me is the billing and invoicing side of things. We spent a lot of time and had a lot of conversations with our partners around these specific numbers. And from this, we’ve developed a set of knowledge to simplify doing business with us.”
The first step, Letourneau said, is to work with the CSMs.
“Please use your Customer Success Manager,” he implored the audience. “They are here to help you. They are not part of sales. They are your advocate.”
Letourneau said they still don’t have enough coverage on the CSM front, and that means that they will continue to invest more and expand the global team throughout 2021.
“We have to expand,” he stated. We have to bring new CSMs in. We have to break a promise that we made early on and it’s a little bittersweet. When we first started talking to partners, one of the things we heard was that there was too much account manager change. By the time they got to know someone, there was someone else in that seat. We are in a position now where we are going to make changes. The one thing that we have to get right and will get right is that handoff. These are going to be really warm handoffs. You might have 2 CSMs for a while bit while the new person is getting up to speed. We have to get that right. We heard it loud and clear that the account manager turnover was too harsh and too much and we are not going to let that happen.”
So what else is coming in 2021?
“It’s a very dynamic industry,” Pagliuca said. “What’s really fuelling the growth of this market is how MSPs continue to adopt to the landscape of SME but also bigger companies. We are seeing more of this co-managed IT model. We are seeing folks use MSPs for help desk in off-hours, or just a help desk period. We are seeing midsize and large companies start to bring in MSPs to help them with cloud management and security. So that’s definitely fueling this.
“I’m investing in areas where my MSPs can hopefully grow shares of wallet in security and cloud management. We are also focusing a good amount on automation.
Pagliuca pointed out something that was true before the pandemic and will be after it.
“IT resources are scarce. Technicians are very valuable. Leveraging automation will have a happier team and more profitable business and a happier client base as well. We are adding to our cookbook to bring more automation so MSPs can get out of the day-to-day mundane and help with value add. We are focusing on leveraging data from different solutions and pulling them all in in a way that can add value to my MSPs. We are also seeing a lot of low code and no-code type of automation. We will continue to pursue those areas and educate MSPs on them.
“We continue to see crazy proliferation of devices,” he added. “How do we manage them? That’s why we are working with Cisco on Meraki automation templates so we aren’t bogged down in all these IoT devices that are here.”
Pagliuca also stressed that automation is important for human health as well as business health.
“During the first wave of the pandemic, our MSPs worked more hours than ever before, and it had a huge impact on mental health,” he said. “It took a toll. Anything we can do to relieve some of that pressure is also top of mind for us. What can we do to free up some of their time so they aren’t putting in those crazy hours that they have been?”
Finally, Pagliuca concluded by emphasizing that the company, like most people, is eager to put 2020 in the rear view mirror.
“I’m looking forward to putting 2020 behind us,” he said. “I’m not going to lie. But I am quite optimistic about what 2021 has for SolarWinds MSP – or whatever the ‘spinco’ is with our new colours.”