MSP+ v. Bielanski: The Roll-Up Paperwork That Didn't Match

[00:00:02] Five firms merged into one in 2023, and the merger agreement listed a $700,000 SBA loan as a debt the new company would take on. Both sides now agree the borrower of record wasn't the company that list named. Now they're in federal court over who has to pay it. This is the Business of Tech. I'm Dave Sobel.

[00:00:29] Before the story, a disclosure. I own Small Biz Thoughts, an IT service provider university, which sell community and education to MSP owners, including a mergers and acquisition course taught by James Kernan. James knows people on both sides of this case and wasn't involved in any of the businesses in it. MSP Plus sells advisory and leadership work to the same MSP owners, so I'm reporting on a company and a market I compete in.

[00:00:57] This story also ends on lessons about how deals get done, a subject my business sells a class on. And I know MSP Plus' CEO, Brett Jaffe, and several others on his leadership team professionally from the MSP community, and I know Adam and Nicole Berlanski from the MSP community as well. Weigh my conclusions with all of that in mind. The facts come from the court filings.

[00:01:24] MSP Plus, the consultancy formed in 2023 by combining five firms that advise managed service providers, is suing Adam Berlanski, its founding CEO, along with his wife Nicole Berlanski and three companies tied to them. The suit says the company misrepresented the finances of the largest firm in the merger, left MSP Plus paying a federal disaster loan never legally owned, and took company data when they left.

[00:01:51] The Berlanskis deny the claims and have countersued. They say MSP Plus took on the loan as part of the deal, then stopped paying it, pushing it into default, and that the company owes them at least $175,000 in deferred pay. The case, MSP Plus, MSP Plus, Inc. vs. Bolanski, No. 226CV02620, was filed August 20th in federal court in Las Vegas.

[00:02:21] None of the claims on either side has been tested in court. Both filings, MSP Plus, MSP Plus, and the Bolanski answer and counterclaims are posted in full with this story at businessof.tech. MSP Plus OS Inc. was incorporated in Nevada on August 24th, 2023.

[00:02:42] On September 30th, it merged five businesses, Sierra Pacific Group, ConnectStrat, Stack Advisors, XPM2 Partners, and Delta Vita. The owners were paid in MSP Plus stock rather than cash. Adam Bolanski, CEO of Sierra Pacific Group, or SPG, became MSP Plus' first chief executive. Nicole Bolanski was SPG's chief revenue officer and joined MSP Plus' initial board.

[00:03:11] According to the Bolanski's counterclaim, MSP Plus issued 200,000 shares at $29.96 each, a total of about $6 million. SPG's contributed assets were valued at $2.72 million, the largest of the five, and the Bolanski's holding company received 22.68% of the stock. Seven months later, that valuation was revised.

[00:03:40] The counterclaim says that in April 2024, MSP Plus' finance lead told shareholders SPG, quote, actually had significant negative EBITDA and liabilities, end quote, and proposed revaluing it. The shareholders then approved restructuring the company's stock, raising the share count from $200,000 to $900,000, and cutting the Bolanski's stake to 17.35%.

[00:04:07] Right, Jaffe replaced Adam Bolanski as CEO in January 2025. Bolanski stayed on as chief community and ecosystem officer until he resigned effective December 31st, 2025. Nicole Bolanski's employment ended in July 2025, according to the counterclaim. If you're listening to this and haven't hit follow yet, on Apple Podcasts, search Business of Tech. Takes five seconds, and you'll get the next episode automatically.

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[00:05:06] That's PAX, the number 8, dot com. In events, Ninja One has a free on-demand webinar on making your security hygiene work visible to clients. What to measure and how to show it at a QBR. Link is in the show notes. MSP Plus' complaint says the Berlanskis induced the merger with misleading figures about SPG.

[00:05:33] It cites a September 13, 2023 email from Adam Bolanski saying SPG was, quote, back to 15% profit and trending higher, end quote, and a pre-closed financial summary describing 80% of SPG's revenue as monthly recurring. MSP Plus says several of those engagements were actually fixed-term projects, some already ending or ended,

[00:05:57] and that projects built in advance left MSP Plus to deliver the work with no revenue against it. MSP Plus also says SPG could not meet its December 2023 payroll. That shortfall was disclosed on December 22, days before launch, and a shareholder covered it with a $200,000 bridge loan. The complaint quantifies the damage.

[00:06:21] It says monthly revenue lines of about $133,000 present in January 2024 were gone in January 2026. Staff fell from about 61 at the merger to about 24, with more than $250,000 in severance, and the company carries a credit line of about $454,000. The complaint calls the sale MSP Plus had planned, quote,

[00:06:47] no longer realistically available on the terms originally anticipated, end quote. The loan is the second front. The merger agreement listed SBA loan SPG, EIDL loan $700,000, as a debt MSP Plus would take on. MSP Plus says the actual borrower was Sierra Pacific Consulting, a separate Bolansky company that was not part of the merger,

[00:07:13] and that the SBA refused to transfer the loan in April 2024. MSP Plus made 24 monthly payments totaling $99,840 before stopping in January 2026, and wants that money back along with a court ruling that the loan was never its debt. The third front concerns the departures. MSP Plus alleges Adam Bolansky deleted more than 40 gigabytes of company email and documents.

[00:07:41] It also alleges Nicole Berlanski downloaded MSP Plus' client list from HubSpot, and that her new employer, Frictionless IT, later confirmed she brought a list containing MSP Plus' former clients. MSP Plus further says Adam Bolansky used a Frictionless IT email account in April 2026 to offer coaching to an MSP Plus client.

[00:08:05] Among MSP Plus' 13 claims is misappropriation of trade secrets under the federal Defend Trade Secrets Act. In their September 29th answer, the Bolanskis deny nearly all of it. They confirm that SPG could not meet its December 2023 payroll from its own resources, but put the shortfall at $100,000 and say they repaid their share of the bridge loan. They deny deleting company data.

[00:08:33] They say Nicole Bolansky accessed HubSpot as part of her job as chief revenue officer and later chief marketing officer, and that Adam Berlanski's coaching work does not compete with MSP Plus. On the loan, they say SPG's owners agreed to carry it and, in 2022, voted to increase it from about $152,000 to about $700,000. They say MSP Plus' officers signed a March 2024 letter to the SBA requesting the transfer, quote,

[00:09:03] with a full understanding of the responsibilities and obligations associated with the EIDL, end quote. MSP Plus' stopping payment, they say, led the SBA to declare the loan in default and demand the full balance. Adam Berlanski is its personal guarantor. Their counterclaims ask the court to rule that MSP Plus took on the loan and must cover Adam's personal guarantee.

[00:09:27] They also seek at least $100,000 in deferred pay for Adam and $75,000 for Nicole, plus Nevada's late wage penalties and reimbursement of their legal costs under MSP Plus' bylaws. Finally, they ask the court to confirm their holding company owns 156,132 MSP Plus shares and to enforce a right to make MSP Plus buy those shares back. What the party said.

[00:09:56] MSP Plus said in a statement, quote, We appreciate the opportunity to provide some context. Because the litigation is ongoing, we're limiting our comments on the case to what is reflected in our public court filings and allowing the legal process to address the disputed matters, end quote. The company said its focus is on clients and, quote, the next chapter of MSP Plus, end quote, offering advisory, leadership development, and operational work to MSP owners. MSP Plus declined to give a current headcount.

[00:10:25] Staying staffing would be addressed within the litigation. Michael Fetter of Dickinson Wright, the Bolanski's attorney, said the answer to Business of Tech's questions, quote, is contained in the filed answer and counterclaim, which contains a far more accurate reflection of the matters at issue in the case, end quote. ConnectWise told Business of Tech that its Advantage program, which MSP Plus' complaint cites as a source of lost revenue, has since ended.

[00:10:53] It said its current ConnectWise partner program, a sell-through offering focused on marketing and sales support for MSPs, is a separate program that for a time ran alongside it. Jaffe said MSP Plus still does substantial consulting work on ConnectWise products, but that the work is no longer driven by ConnectWise itself. Steve Martin, CEO of Frictionless IT, said, quote, As this is a legal matter between two other parties, out of consideration for the parties involved,

[00:11:22] we feel it best not to comment on legal aspects of the case. However, it is a matter of public record that Adam and Nicole were employed at Frictionless IT, and that they have both moved on to other endeavors. We have great respect for Adam and Nicole, as well as our friends at MSP Plus. We hope and pray they can resolve their dispute as quickly as possible, end quote. So, Frictionless IT did not address the complaint's account of the client list.

[00:11:47] MSP Plus' response to the counterclaims is due October 20th under the federal rules, unless the court extends it. This episode is supported by ScalePad. There's an argument going around that customer success isn't a department you add to an MSP, it's the operating model, and that most shops are running service delivery and calling it the same thing. ScalePad rebuilt Lifecycle Manager around that idea,

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[00:12:46] ScalePad.com backslash MSP Radio Why do we care? Because underneath the accusations, this is a case about documents that didn't match reality. The merger agreement lists the loan as SPGs. The borrower of a record was Sierra Pacific Consulting, a separate company Adam Bolansky ran, which wasn't part of the merger, and Adam Bolansky personally guaranteed it. And the paperwork never caught up.

[00:13:15] In March 2024, MSP Plus's officers, the Bolansky among them, asked the SBA to transfer the loan. According to the complaint, that request named Sierra Pacific Consulting as the holder. A week later, all nine shareholders, the Bolanskis included, signed an addendum that, by the Berlanskis' own filing, said Sierra Pacific Group had obtained the loan. MSP Plus describes that addendum as a response to what it was learning about the loan. It named SPG,

[00:13:43] not the borrower of record. The two biggest fights in this case, who owns the loan and what SPG was worth, both come back to whether the paper matched the facts. That matters, because in a contract fight, the signed documents usually are the reality. The Bolanskis argue the agreements are fully integrated, meaning what was signed is the whole deal. MSP Plus argues the paper itself was false. Either way,

[00:14:12] the argument starts with what was signed. So before you sign anything in a deal, check that the documents say what's true. The name on the loan, the terms of the contracts, and the approval of anyone, like a lender, who has to agree. If the documents don't match the facts, the documents are what you'll end up litigating. That's the main lesson. There are seven more, and each one holds no matter who wins.

[00:14:42] Second, your emails become the evidence. Both sides built their cases on messages nobody wrote for a courtroom. MSP Plus quotes Adam Bolanski telling the people he was merging with less than three weeks before closing that SPG was back to 15% profit and trending higher. The Bolanskis quote MSP Plus's finance lead, writing that SPG actually had significant negative EBITDA and liabilities, and later that the loan payments

[00:15:09] might need to revert back to SPG shareholders if MSP Plus goes under. Every one of those lines was written while running a business. Everyone is now in a federal court filing. Write deal emails as if a judge will read them. Third, check cash, not just revenue. According to MSP Plus, the summary it saw before closing described SPG's margins and its recurring revenue.

[00:15:38] Both sides now agree SPG couldn't meet its December 2023 payroll from its own resources, three months after the deal closed. They disagree only about the size of the gap, $200,000 according to MSP Plus, $100,000 according to the Bolanskis. Revenue tells you what a business bills. Cash tells you whether it can pay its people. Fourth, vendor program revenue can disappear for reasons nobody in the deal controls.

[00:16:09] MSP Plus's complaint lists lost ConnectWise Advantage revenue among the losses it ties to SPG, which the Bolanskis deny, and says that program generated as many as 130 projects a month at its peak. ConnectWise says that program has since ended, and neither side's filing mentions it ended. If part of what you're buying depends on a vendor's program, the vendor can change its value without asking you.

[00:16:39] Fifth, in a stock deal, the price can change after closing. SPG's owners were paid in MSP Plus shares. About seven months later, by majority vote, the shareholders reallocated the company's stock and took the share count from $200,000 to $900,000. The Berlanskis stake fell from just under 23% to just over 17%, and the other SPG owners' stakes fell by the same proportion. If you're paid in paper,

[00:17:09] read the shareholder agreement for who can change what that paper is worth and how many votes it takes. Sixth, a personal guarantee doesn't leave with the business. Adam Bolanski guaranteed the loan when it was taken out and again when it was increased. The business moved, and the loan was listed in the merger, but the guarantee stayed with him. When MSP Plus stopped paying, the Bolanskis say, the SBA declared the loan in default

[00:17:38] and demanded the full balance. Adam Bolanski is now asking the court to make MSP Plus cover his guarantee. If you're selling a business with debt you've personally guaranteed, get released by the lender or indemnified in writing before you close. Seventh, deferring pay makes you a creditor. The Bolanskis say MSP Plus asked its executives, them among them, to defer part of their pay. Adam Bolanski now says he's owed at least $100,000

[00:18:08] and Nicole Bolanski at least $75,000. MSP Plus says other shareholders advanced at least $175,500 in cash and deferred at least $138,345 in pay and that the Bolanskis made no comparable contribution. The Bolanskis say their combined deferrals exceed what every other shareholder deferred put together. Deferred pay is effectively an unsecured loan to your own company.

[00:18:37] If you defer, put the repayment terms in writing, including what happens when you leave. Eighth, retention settles departure disputes. MSP Plus says Adam Berlanski deleted more than 40 gigabytes of company email and documents on his way out. He denies it. By MSP Plus's account, the data has not been recovered. A retention policy that preserves mailboxes would have made that a question

[00:19:05] with an answer instead of a dispute. It's a service most MSPs sell. Make sure your own shop runs it, especially when someone senior gives notice. This is the business of tech. Want to go deeper than the news? The Small Biz Thoughts community is where MSP owners and operators work on the business, not just in it. Member meetings, a deep resource library, and courses through

[00:19:34] IT Service Provider University. Everything you need to run the practice you actually want. Join us at smallbizthoughts.org Interested in advertising? Head to mspradio.com slash engage. The Business of Tech is written and produced by me, Dave Sobel, under ethics guidelines posted at businessof.tech. Thanks for listening. I'll see you on the next episode.

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