Jonathan Schofield | Unlocking Referral Gold: The Secret Sauce to MSP Growth

[00:00:00] Imagine if Tinder and LinkedIn were having a baby. Well, that's just what Jonathan Schofield did when he thought up the concept of Channel Falcon. It's a matchmaker building relationships between MSPs and those that need them. Today, Jonathan and I have a great conversation about earning mental real estate in the mind of your customer and how to build attraction when going to market. It's always a blast when I get to talk to Jonathan and I hope you see that today on this week's episode of MSP Business School.

[00:00:38] Hey, everyone. Welcome to the latest installment of MSP Business School. As always, I'm Brian Doyle and I'm here with you today as we are doing our first partner podcast of 2025. And I'm really excited about today's guest. I've gotten to know him over the course of the last six months quite intimately and I'm impressed every day with the energy he puts out into the marketplace and what he's willing to share with the MSPs.

[00:01:05] So I'd like you to all join me in welcoming Jonathan Schofield from Channel Falcon. Hey, everybody. So great to be here. And Brian, that's very, very kind things for you to say. It's definitely a pleasure being here. Looking forward to having some fun, man. Nah, man, you've been awesome. You know, as I've gotten to know you as last over the last six months, you're out there, you're trying to give, give, give. And that's one of the biggest things I've seen of you, both at shows, both in the things that you're doing, both.

[00:01:32] And then I look at what you're doing regionally, too. And we'll probably get more into that with the meetup that you sponsor right around your location of Greenville, South Carolina. So, you know, every time I turn around, I see a post from Jonathan. So it's a good thing to see, man. He's building that brand. He's making sure everybody knows he's out there. So kudos to you, man. Oh, thanks. We're trying. We're figuring it out. So, you know, let's kick off with maybe a little bit of, though, how you ended up here, right?

[00:01:58] Everybody's got a great story of how they've traveled into the world of MSP and found themselves there. Why don't you start off by telling us a little bit about, you know, where your life took you? Oh, man. Yeah. I always struggle to know where to begin. But I guess the too long, don't read version is it all started with a global apocalypse or pandemic in not so distant past.

[00:02:23] In a former life before said apocalypse, I've always been in technology sales in one capacity or another, even from, you know, a teenager at 17. If being in a cold calling center for charter cable back then counts is where I kind of cut my teeth.

[00:02:44] But throughout the course of my young adult career, I mean, I wore a lot of different hats in business development and sales and eventually started leading teams, business development teams, hiring and firing and training and managing and working with various different types of channel partners. Particularly before I even knew what an MSP was, worked very closely with ERP resellers and partners.

[00:03:10] And I consider that, especially, you know, years ago when that was my world channel adjacent, the MSP channel adjacent. And now more and more, there's tremendous crossover between more and more every day. And we can touch upon that today. 100%. 100%. 100%. But that's where I kind of got my start in technology sales and business development and just where I grew a lot of my business acumen.

[00:03:36] But then 2020 came along, kicked the company I was working for at the time square in the teeth like it did for so many. And little did I know it would become a blessing in disguise when they let me and eight other people go. And that's when, you know, I hit the ground running in the middle of the pandemic looking for work. Nobody was hiring. So I had the genius idea. I was like, well, I could sit on my hands and wait for this to blow over and hopefully somebody hires me or I could try and build something.

[00:04:06] Whether I fully realize it or not, at the time, I've always had sort of the entrepreneurial muscle. It just had never really been fully given the opportunity to flex and build itself. And so why not? So I started Dark Horse Business Systems, as you see on my hat, which is the parent company for everything else that I do right now, in April of 2020.

[00:04:29] By summer of 2020 was my first exposure to the MSP channel. And I sat down across from a gentleman who had run development for a custom software component at an MSP for 12 years. And he left his job to write a piece of software, cybersecurity software. And we got connected through a mutual friend.

[00:04:57] And he sits down with me over coffee one day. And he says, hey, so I wrote this piece of software for privileged account management, for MSPs. It helps with, you know, creating accounts and changing passwords and all that stuff. Shout out to Martin and Tech ID Manager. And I've mentioned him by name because I probably would not be in the channel the same way that I am if it weren't for that first opportunity. But this conversation, Brian.

[00:05:23] He's like, hey, it's important to recognize our mentors and the people that helped us get here. There's no doubt. That's right. That's right. But what's funny about this is he's like, I'm an engineer. I really don't have sales experience. I don't have interest in it. I have this product. I have a buddy of mine who's paying 50 bucks a month for a beta version of the product. Can you help me get this in front of more MSPs? And that was the question he asked me in 2020. And I said, I don't know. I said, quick question.

[00:05:54] What's an MSP? And he laughed and I laughed. And I said, no, but seriously. And so that's kind of how that was the first domino in a series of dominoes that would bring me to where I am today. The fast version of those other dominoes would be in my own business. I started working with him as a vendor, taking his product to market, learning about the space.

[00:06:20] And then along the way, my own venture kind of became a side hustle for a time. And I would take a W2 job with a cloud services company that was channel only. And that's where I started hitting the trade show circuit and meeting a lot of you folks at the IT Nations and the Datto Cons and the Robin Robbins events. And you just you name it, me and my team were there.

[00:06:46] And I drank from a fire hose in that first year, not only from just the nature of the channel, but cloud services, backup, disaster recovery, cybersecurity products. And I just my brain went like just exploded with all this new information. And what I really love with that time there is like I just I really got the raw energy and community experience that is in our space for those who take advantage of it and go out and participate in it actively.

[00:07:15] Loved that job, Brian. And then after, you know, some private equity money came in and people started buying each other and I woke up one day and found myself a round peg in the square hole of corporate America. And I left that company and decided I have more to offer the space working for myself than I did working for the man, so to speak.

[00:07:42] And I decided to tackle this really difficult area of the channel that I don't think many people have good answers to yet. So that's that's my story. It's brought me from there to here without saying too much about what I'm doing right now. But yeah. And if if you've been at some of the trade shows, you've seen Jonathan is not shy either. He will dress up. He will he will he will make sure that his presence is felt.

[00:08:12] But that is something you need to do to differentiate yourself and build a business. So, you know, it's fun to watch from the outside in. So good stuff, man. But, you know, this leads us to today. Right. And you've really got something interesting going on today. You want to share a little bit more about that? Well, all right. So you heard the story version that brought me from where I was to where I am. When I decided to leave corporate America, I can't admit that I had a really strong plan initially.

[00:08:41] But a lot of my friends, whether they were MSPs or vendors or peers and colleagues in the channel, when they heard that I had left that large opportunity where I was making some of the best money in my life, by the way. They started to talk separately about money not being everything. Right. Sanity is a part of it. 100 percent. 100 percent. People started digging into whether it was LinkedIn or they started hearing about Dark Horse for the first time.

[00:09:08] And I got reached out to by a handful of MSPs. And they said, hey, Jonathan, we didn't know about this part of your world. We didn't know that you had your own business and that you did effectively lead generation and business development for technology companies. You've been holding out on us. And they said, we're MSPs. We need leads, too, man. Where have you been? And they're like, can you help us?

[00:09:36] And my answer to them was just similar to Martin when we talked years ago. It was like, I don't know. I said, the reality is I don't think it's the same. You don't sell pizzas or shoes or a SaaS product I can add to cart and check out.

[00:09:52] I don't believe that taking the enterprise playbook and the private equity backed SaaS playbook and applying it to the service provider model is going to be effective. But then I got this feedback. Well, Jonathan, no, we believe in you. So would you at least give it a go? So I almost reluctantly, Brian, took on three MSP clients around that time where we decided to run this experiment.

[00:10:22] And we're going to take those playbooks and see how far down the field it would take us. The model back then was very, very different. In its early stages, it was basically outsourced appointment setting. And Jonathan, who has done a lot of hiring and firing and training and managing at this point in his career, would hire, train and manage a BDR for your MSP. And I'd help you build the data sets of targets and the messaging and all of that stuff.

[00:10:48] And then we would go and we would cold call and we would try and book appointments for MSPs. And I'm here to tell you, I'm not here to tell you that it didn't work, but I am here to tell you. And those of you who are watching or listening to this later and have tried outsourcing before, maybe are outsourcing today, will probably not be surprised to hear what our experience was. Yes, we would book appointments. We would find leads.

[00:11:16] But in terms of their quality and their readiness to buy, it was really all over the map. And it was never enough volume. So after around five months, I started feeling a real sense of dissatisfaction with the value we were providing our partners. And I, you know, I would put my head down at the pillow at the end of the end of the month, you know, and it was like I knew that ACH with the next six grand from one of my partners was going to hit. And I felt a certain kind of way.

[00:11:45] And most of my MSPs, man, they are small businesses themselves. So to take six grand and am I giving six grand of value back? We definitely were giving always six grand. You're giving six grand of effort standing still. But it is challenging to find the right leads in the MSP space. Yeah, yes. And so that took me back to the drawing board.

[00:12:08] The drawing board meaning like if I take 10 MSPs and I line them up against the wall and I ask them, where did your last customer come from? Where did you your last client come from? What are nine of them going to say, Brian? Referral. Referral. Word of mouth. And I I've come to realize that there's a reason why. Now, that is a blessing and a curse.

[00:12:35] And you pulled up the MSP paradox banner there a minute ago. It's a blessing and a curse for service providers. If you're watching this and you provide IT services, you will identify immediately with what I'm about to say. The paradox is that when you have a client that's come to you from a referral, right? Whether it's a customer that trusts and likes you right now and they're getting value out of their services or somebody that you have a good relationship with,

[00:13:02] you have a high chance of closing that and a high likelihood of retaining that revenue for a very long time. Amen to that. I think a lot of the technical leaders in our industry, one of the biggest challenges they have when they hire that first salesperson is they don't take into account. It's a different type of sale than the one they've been making. The one that got them to the point, though, that they flatlined. Yes.

[00:13:28] Can't get to the next level and realize they need it because they've exhausted the Rolodex, if you will. And while they still get leads from the referrals of the people that are getting, it trickles in a little bit differently than it did the first three years or five years of their existence. Well, what I have discovered, Brian, that what it really boils down to is this phrase that I've coined. I call it the mental real estate of the customer. Right.

[00:13:52] And if you had a commodity that you sold, you sold pizzas or shoes or a SaaS product that I can add to cart and check out. Mental real estate is fairly easy to accrue. Fairly easy. Right. Like, oh, I'm hungry. I'm going to go to my email and look and see the last time Domino's emailed me a coupon and I'm going to go buy myself a pizza. Right. Right. The need is immediate and the path to the purchase is very direct.

[00:14:21] It's very transactional. It's gratification, right? Yeah. Yeah. And the transaction is never more than a couple steps away. But that is you don't sell pizzas in managed IT. And you could make all kinds of statements like you're sellers of trust, you're sellers of partnership, you're sellers of relationship. And those things would all be true.

[00:14:43] And in whether you're selling pizzas or shoes, it comes down to who occupies the most mental real estate will ultimately be who wins the deal. And now if you reverse engineer why referrals happen, okay, you had to do absolutely nothing to earn that mental real estate with that future customer in the form of a referral.

[00:15:04] It was brokered for you on your behalf by a happy client, by a center of influence who's a friend or a peer or colleague in the industry that recommended you. They already had mental real estate, which is why it's not satisfying. This is where the paradox comes in. Well, like, do I just sit on my hands as an IT business owner and wait for referrals? Or is there something I can do to go elicit more referrals?

[00:15:34] And the answer to both of those questions, the first one, the answer is no, you don't just sit on your hands. The answer to the second question is yes, there are things that you can do. But this is where we can kind of build a screen through which we filter every business development, sales and marketing decision that we now would make in our MSP. Will it accrue mental real estate with my future customer? And if the answer is no, don't do it.

[00:16:01] So before you click yes on that contract for that LinkedIn automation campaign you're thinking about, or that cold email campaign, or that SEO specialist, or that cold calling agency that's promising this or that or the other thing, you have to filter it through that screen. Will this help earn mental real estate? So what am I doing right now?

[00:16:26] Much of my time is spent with my MSP partners helping them identify ways that they can earn that mental real estate. The bigger vision for what Channel Falcon is trying to do is a lot more nuanced, and I'm happy to go into that. Well, we'll definitely tie on that. You know, I really, you know, I want to echo kind of what you were saying there about the mental real estate. You know, that referral sale comes with already that built in trust.

[00:16:52] And thus it accelerates the whole process, not just, you know, the things that you talked about, but even the sales process becomes much tighter, much quicker because of that. And I think, you know, as leaders bring on their salespeople and really look at that cold calling sales process, that not as network sales process, you've got to have a little forgiveness gene in there as well. And, you know, and give it some time to build because that kind of trust doesn't get built overnight.

[00:17:19] You know, you've heard the nine touches of marketing and all that other great stuff that lives out there. And you kind of were dancing around that a bit too, where it's just until if it can't make a good mental imprint, why do it? And, but it takes time to build mental imprints. You know, I talked about your social media. That didn't happen overnight, right? You know, I met you for the first time at IT Nation Secure. You were a part of my sphere at that point, right? Last June. And, you know, now I can't get you out of my LinkedIn stream.

[00:17:49] Sorry, but not sorry. No, no. You know, the point is, but it's because I, I mean, you know, as I got to know you, as you started taking that mental real estate on my side, I was, I was curious of what you were doing. I wanted to see more. I wanted to see what you're up to and you're making those imprints that obviously make a difference. Well, the theory over here at Channel Falcon is that it all comes back to that idea of mental real estate and what we're trying to build. I call it an economy of trust.

[00:18:16] And just to like not beat about the bush for people. Well, what we're trying to build and it is 100% in an alpha state. Hopefully beta will be coming out even as early as this quarter. Uh, but if, uh, if Tinder and LinkedIn had a baby for SMBs looking for MSPs, that's what we're trying to build. But the idea behind the platform is an economy of trust.

[00:18:45] So you're not trusting your infrastructure and your users and your endpoints to a Google search anymore. Right. And when you're in that crucible of crisis and you need to make a decision that's really important, where can you go where, you know, there's a marketplace of vetted, trusted, high value service providers.

[00:19:05] Um, and where they can, in a non, uh, aggressive salesy way interface with each other and be matched to each other. Um, so that idea of trust, I think is so key. And what you said earlier about the multitude of touches required, um, the human brain's amazing, right? And it's capacity to build and retain associations, right?

[00:19:34] Uh, if, if I take the practice manager for a law firm and let's say I take 10 of them and I line them up against a wall and I say, I want to, I want you to say the first word that comes to your mind. When I say the cloud. Okay. Right. These are not necessarily it people, right? They're going to say all kinds of things.

[00:19:59] Some of them might say servers, some of them might say Microsoft, some of them might say AWS, some of them might say the internet, you know, and I just displayed to you some things in my dropdown menu of associated concepts. Right. And just like a computer, right. When, when the input is there, there's that dropdown menu of associations. And here's the, the, the sobering reality for MSPs.

[00:20:25] Your future customer, when they wake up in the morning in the face of a cyber incident, or they've got downtime or their current provider has dropped the ball in some, some way, somehow, or they had to let their CTO go or whatever it is, whatever the incident that's got them searching. And now the, the dropdown menu of associated concepts populates in their brain. You are not on that list.

[00:20:56] And so the goal of sales and marketing business development, any of those things in the channel, you might think the goal is to be number one on the list. Goal number one is just to get on the list right now. You'd be doing well just to be in that dropdown menu of associated concepts. Jonathan. Jonathan, I used to tell them my marketing team back when I was an MSP. Our goal is to try to help our sales team get on cold calls and have the person on the other end of the phone go. Yeah.

[00:21:25] I think I heard of you guys. Not even yes, not even anything, but yeah, I think I've heard of you guys. That means they felt at least some of our imprints somewhere and somehow they've made some relationship in that dropdown list in their mind. Right. Oh yeah. I know. I, I at least kind of know these guys. I don't know much about them, but for some reason I've heard of them. Right. And it's that little subtle thing that opens up that door that oftentimes can be being held back on you when you're making that cold call or that first introduction and those kinds of things.

[00:21:52] So, you know, I love the approach you're taking that mental real estate only do the things that do that. So you can occupy that brain. So then ultimately you can hopefully smash down that door is, is great Avenue of Pat. Do you know that. Do you know that this is a shameless setup for myself, but do you know what the, the most direct path to earning mental real estate with your future customer is? I'm going to let you cue that one up and tell me. Okay. Okay. Well, here it is.

[00:22:22] So in the, for MSPs watching authentic, physical human connection. Connection. I'll say it again. Authentic. Physical. Human. Connection. Okay. Now, what do I mean by this? Break it down. If I was in the same room as you, there's you, you made a comment earlier about how sometimes I'll go to shows and I'll like make an idiot of myself dress up and things like that.

[00:22:51] There's a method to the madness. 100%. What I am trying to do when I do those types of things, when I, when I, why do I even go to shows to begin with is physical proximity. Proximity, right? Number one, physical proximity. If I can be in the same room as you and I can shake your hand, buy you a drink, you can smell my breath. You can sense my posture and my energy. Proximus to yourself.

[00:23:18] I am going to earn in spades mental real estate that a cold email never will. Yeah. That a digital ad on TikTok or on Reddit or LinkedIn never will. Now, can those other tactics help facilitate authentic physical human connection? I would argue that they do have a place and they can. But the physical component is really, really important. The physical proximity.

[00:23:46] So, I, right, wrong, or indifferent, and I'm still a student of this myself. In our own marketing efforts, in our own business development efforts, I always filter those decisions of whether we're going to do this thing or that thing. How is this going to facilitate authentic physical human connection? And if it's not, it needs to be setting up the next step where it will be authentic physical human connection.

[00:24:13] And this is where I think a lot of MSPs bail too soon. They're like, well, we did, we hired a cold caller and they made 100 calls a day for two months and we didn't get anything out of it. And they're like, oh, we did digital marketing. We spent $500 a month in Google AdWords for six months and didn't see anything. And they're, what are they doing? They're throwing mashed potatoes against the wall here and there and there and they're hoping something sticks. When the reality is, it's not any one thing.

[00:24:41] It's the sum total of all the things that are going to help earn mental real estate. But far and away, if you only had one thing to do, if it was just, if you had to plant your flag on one supposed tactic for business development, I would be saying go and network. And if you're a solopreneur or you're a founder, it's founder led sales right now. You might not like to hear this, but there's nobody in your organization more qualified to do that than you.

[00:25:11] You cannot abdicate the responsibility of your own growth. Go shake some hands, go kiss some babies, go pour some drinks, go hang out with where your customer is. And that will earn you mental real estate in a way that some of these other like throwing money at it tactics just won't. Well, you know, I love that because when I was an MSP, one of the things I used to always believe in was own your backyard. Right. You know, work from the inside out.

[00:25:37] So a lot of MSPs, especially now with the fact that we're able to do things so virtually, right, with Teams and Zoom and all these other things that we have at our disposal. Everybody's trying to conquer a world much bigger than the, you know, 10 square miles around them. But if you look at that 10 square miles, you can build quite a business as well. And it comes right back to what you're saying. Own those rooms that those people that are in your neighborhood live in. You know, this is probably a great segue into what you're doing out in South Carolina.

[00:26:06] You've really, you know, I love seeing the posts because it's consistent. It's ongoing and it's growing. Right. I see that happening, you know, right before my eyes. And it's a perfect message, I think, for the folks that ties back to authentic physical and human interaction. Yeah. I would just encourage everybody who's like, don't be afraid to think outside the box. You're talking about Upstate Channel Collab. Absolutely.

[00:26:32] Here in the Southeast, a thing that I've started about 10 months ago. We're having our 10th one in, what, two weeks or something like that. Where that started was, honestly, Brian, you know, you mentioned that you and I met at IT Nation Secure. That was in Orlando. Yeah. Man, if I could travel to Orlando and Las Vegas less, that'd be fine by me.

[00:26:55] For some reason, all the folks in our space just love doing events in Orlando and Las Vegas. And I know why Orlando. Orlando makes a lot of sense because there's a lot of the juggernauts in the space are headquartered there. But I woke up one day and I looked in my own backyard, as you said, and I'm like, wow, Greenville's a little bit of a strange town. We've got TD Cenex and we've got ScanSource. We've got Intellisys. Ingram Micro's got offices here.

[00:27:25] We've got Mail Protector and Scope Stack and Tech ID Manager and Net3 Technology. For a smaller region, a lot of big companies. Yeah, some are bigger, some are smaller, but a lot of channel companies. And those are all just vendors that I mentioned. There's about 50 plus IT providers in my backyard as well.

[00:27:45] And so I was like, man, if I could travel to these other places less and spend more time in my own backyard where I can be more hands-on in the community in a way that is more difficult to do where I am not. Right? Yep. And if you're an MSP, what I hope you're hearing is, man, why do I wait for those types of opportunities to happen in my own backyard?

[00:28:12] If they don't already exist, you can go facilitate them. I'll give you an example. One of my partners in Connecticut who works with financial services companies, right? We've been trying to figure out a creative way of getting him involved with those folks more. And so he said, all right, well, we had this idea. Well, let's do a lunch and learn. Well, we tried that before. It didn't work. I was like, well, what about a different approach?

[00:28:37] What if we create a list of all the CPAs, bookkeeping companies, financial services companies within a 50-mile radius of your headquarters? And we're not going to sell them on a lunch and learn first. We're going to just call them first. And we're going to ask them a question. Like, hey, if we did a thing, like we work with CPA firms and bookkeepers just like you. We're thinking about hosting a networking and education event. Well, we don't have anything planned yet. We wanted your opinion first. If we did something like this, would you even be interested?

[00:29:07] If you were interested, would you rather it be over lunch? Would you rather it be in the evening? Would you like us to bring in a guest speaker? Just keep it more casual. And what the theory is, and you can ask me about this after we've done it, but the theory is by co-opting your prospect into becoming a collaborator in your own backyard, now what you've done is you've eliminated a lot of risk. Because before you even invent, you're not ramrodding something you don't need your customer even once.

[00:29:37] You're saying, hey, let's collaborate on this. And now it's like you're not lying to them. But you're just like, hey, let's do this thing that could be valuable for everyone. And you can be part of it. Ground floor. And the truth is, I mean, it's very similar to how we build software features, right? You're co-oping your customers to see what they want. So you put your investments in the right place. Here you're looking to see, can I get 50 people to say yes so I know 20 people will show up at that first event and we get some inertia, right? You know, that kind of thing.

[00:30:05] So that's awesome, man. You know, I mean, these are creative ways. I hope that, listener, that's what you're really seeing here is kind of some creative ways. This is the part I love about Jonathan. Creative ways to kind of create your own market when a market might not be existing, at least in that six inches in front of your eyes. Yeah. I guess one of the last things I'm going to say here on this particular topic, unless we want to spend more time here. Unfortunately, we got to wrap up soon because we try to keep to under a half hour for our listeners.

[00:30:35] But I could sit and listen all day to you. All right. Very good. Well, the only thing I'll say then is if you're wondering where to start, don't reinvent the wheel. Go talk to your customers. You're like, will this thing work? Go ask them. Go ask your clients. When was the last time you sat down with your top five clients and said, hey, we're thinking about doing this thing. Would this have resonated with you? So, guys, I'm putting up on the screen now for those that are watching and that are listening on the podcast. This will also be down in the show notes. Go visit Jonathan at ChannelFalcon.com.

[00:31:04] Ignore the fact it says Falcon because we were just typing this a moment ago. And we've got Jonathan's LinkedIn up here as well. This will be in the show notes for you also post-meeting. Jonathan, I always want to end with any closing thoughts you have, anything that you want to wrap up and make sure our listeners understand before we say goodbye. Growing your IT business is no one's responsibility but your own. You cannot abdicate that responsibility. Let that be an empowering thing, though. You don't have to do it alone.

[00:31:34] And if you need help, don't be shy. Awesome. Well, Jonathan, it's always a blast to chat with you. I know I'll see you out in the circuit throughout the year. But, you know, best to you. And thank you for joining me today. My pleasure. Thanks for having me, Brian. You bet. Take care. Thank you.