Given the continually increasing demand for managed IT services, starting an MSP firm at this time wouldn’t be a bad idea at all. However, the problem is how to ensure that your startup grows into a profitable and intuitive venture.
How do you attract and retain clients? Which tools do you need? How do you trace and record finances? And the list goes on and on; the baseline is that you must make proper prior preparations. We caught up with some seasoned MSP stakeholders discussing the basics of starting an MSP business in a recent Reddit group chat. Their inputs will form a majority of our article today.
The Temptation to Dive Right in and Start Offering Technical Services
You have a long history of working in IT, and the provision of technical services is what you know best. Why not just pull the trigger and go big? If you’re feeling this way, you’re not alone. One user named dwizzle88 says that he’d been “helping clients here and there for a few years (mainly break-fix)” before deciding to venture into MSP. His was the desire to offer technical services to a broader customer base. It wouldn’t take long before he lands the first client, who had 20 users. Then the reality struck him — he was not well-prepared to move into this new space. He hadn’t considered the expenses, tools needed, and whether he had the requisite expertise.
Starting up an MSP requires careful planning and precise execution:
- You must adequately define your offerings
- Establish a reliable pricing structure
- Set up the right workspace for proper customer relations
Which Tools Do You Need When Starting an MSP?
For dwizzle88, he was considering starting with “Quickbooks to manage money, Solarwinds for RMM, Zendesk, and Connectwise.” The truth is that acquiring these tools all at once was a financial burden, but he was willing to go the extra mile. Is it appropriate to run at a loss in the early stages of starting up an MSP? Must you acquire all these high-end tools at the beginning?
According to marvistamsp, you need “only a few mandatory items *IMO* to get started. Everything else is something to get after you build up your customer base.”
He singles out the following primary tools:
- Remote control software
- Ticketing system to track time (unless you are selling “all you can eat” services)
- Antivirus software
- Backup software if the customer does not have something already
His advice? “Get these things (basic tools), figure out how to add customers, and later, you will have a much better idea of what other things you need to add.” While supporting this, pjr1230 says that “you should totally turn a profit now on the first client!” In fact, he adds that “the cheaper your tools are right now (as you’re starting), the better.” At the very beginning, your focus should be more on growth than acquiring sophisticated equipment.
What Steps Can You Take to Advance Your MSP Business?
- Step One: Preparation. What are you offering? How is it different from the other options in the market? Who is your ideal client? These questions will help you define your market, take inventory of your competencies, and identify gaps in your current skills. MaxxLP8 thinks that this is the most critical step because “in the early stages, you must be the MSP that goes far and beyond the call of duty” to survive.
- Step Two: Build a Dynamic Offering. Select the right tools, have systems to document your interactions with clients, and establish a culture of responding to support requests in real-time. You should also develop unique SLAs and MLAs that address the market demands you have identified. Even with the best services, you still need to convince the clientele that you have the best service terms/offerings.
- Step Three: Marketing. Once you have set up your MSP business, you need to announce your presence in the market. Most of the time, the quality of your services will be the first selling point. MaxxLP8 admits that with a satisfied clientele, “you’ll get word of mouth recommendations like wildfire.” If you aren’t an expert in sales and marketing, you could make do with marketing systems or third-party MSP marketing companies. Actionable marketing campaigns will help link you to your ideal customers.
- Step Four: Build an Effective Sales Program. If possible, meet prospects face to face rather than over a phone or laptop. It says more about the seriousness of your firm and has a higher conversion rate.
- Step Five: Time to Seal the Deal. Your end-goal should always be the conversion of prospects into actual customers, but you shouldn’t come across that way. To attract and retain customers, do not appear too transactional. Always show the client that you aim to help them and why you’re the best candidate for that job.
- Step Six: Establish a Good Client Relationship. Always ensure that your clients are engaged and feel like a part of the solutions you provide. Use your online platforms to appraise them on upcoming advancements, seek their opinions, and respond to their queries.
At the end of the day, it’s what you are offering that gives you a competitive edge. Study your target market and tailor your services to address its needs, and you’ll be halfway through building a successful MSP. One more thing — quality MSP is more about people than it is about technology.