Niching Your MSP: The Secret to 7 Figures

[00:00:00] Hey guys, this episode of MSP Mindset is sponsored by Servosity. Servosity is a backup operation center built by a former MSP for MSPs. They take all the busy work away from you so that you can focus on your core.

[00:00:18] And then they couple that with testing daily, weekly, monthly and quarterly so that you know you can recover in any event and focus on your core business. If you'd like to know more about the process or steal it for your own use,

[00:00:34] check out the link in the description. You take a piece of paper, you draw a grid, put all the potential niches in. Take a penny and drop it. Close your eyes and you drop it wherever that penny lands. That's your niche, right?

[00:00:50] If you have no idea which niche to pick, that's as good a niche as any. What I will tell you is whatever it lands on, you can do a million dollars. Hey guys, Damien Stevens, host of MSP Mindset.

[00:01:08] Would you like to learn how Joe Rojas went from homeless to building not just one or two, but three companies to a million plus and exiting each of them? Now he shares how he did it. And the secret is to niche your business.

[00:01:24] If you're having trouble selling, if you think it's the market, if you think it's almost anything else that I learned today, it's just because I didn't niche. Make sure not to miss out on this episode. So, Joe, you've built three different MSPs, successfully exited each.

[00:01:42] I think you've learned the hard way. Nitching is so important now at SART Grimani, as you help all kinds of MSPs figure out how to identify their niche. So and then, like you said, you're brainstorming before this conversation about this.

[00:01:59] So tell me, because it's something I can relate to right now. It's like I have I have something resembling a niche, but I'm not quite there. So how how do I how do I get there?

[00:02:11] And I know I talked a lot of others and just to start with, it's like I'm scared. Part of this fear, like part of it is fear, like because you are kind of saying this is what I stand for, which means you're not doing.

[00:02:21] Yeah, you're not doing these other things. And that's OK. Yeah. It's so interesting that people get afraid at this point, right? And listen, I got afraid at this point. I just had to push past the fear a few times.

[00:02:40] And then I had to do it again when I started this business, because when I started this business, I was like, you know, I serve entrepreneurs. That's everybody. That's everybody, right? And now I serve three different kind of MSPs. Like, I know exactly who they are, right?

[00:02:56] They are start, grow and manage. Right. So start MSPs are either pre revenue or under five hundred thousand dollars. Right. I know exactly the problems they have. We have a program for them that takes them through step by step. Helps right. Manage, grow.

[00:03:12] Those guys are between five hundred and like two point five million. Right. Whole different set of problems. How do I manage effectively? How do I inspire my people? How do I retain? Right. This is like, how do I start? What's an MSA? How does it work? Right.

[00:03:29] And then there's manage and manage whole different set of problems. How do I train my next layer of leaders? Right. So you're two point five plus to about 10, 15 million. That's that's really the space that we plan after 15 million. It's probably not us.

[00:03:44] But in that space, that's where we play. Right. And manage is a whole different set of problems. Right. How do I step away from the business for six months? Not come in at all and have the business do nothing but grow while I'm gone.

[00:04:04] Right. That's a different set of conversations. So what you have to look at as your niche, right, is who is the MSP that has the problem that you solve? Right. What compliance frameworks are they more than likely to have? Why do they need to have your service?

[00:04:29] And you're going to find that you're going to out of the 40,000 MSPs out there, you're going to narrow yourself down to about 500. Right. But that's not a problem. Because if you have 500 and you're charging the right amount of money, you're doing good all day.

[00:04:46] And then if other people want your services, not like you're going to say no. Right. Unless they're really like you wouldn't do it for, I don't know, a auto mechanic shop. Like what if they're an MSP and they have equipment under management

[00:05:05] that you could support, you could say yes, you don't have to say no. But the criteria to say yes is that they fit within your framework, that you could actually deliver with integrity the thing that you say that you're going to deliver.

[00:05:22] And that if it's outside your framework, that you say no, because the saying yes is going to hurt. Because what are some of those signs if I'm saying yes? If you say yes. When I shouldn't be. So I'll give you a perfect example. We're working with an MSP.

[00:05:42] We get him really tuned up for dermatologists. He's going for it. He's onboarding a dermatologist a month. He's like a machine. Everything is going great. Right. Between one meeting and the next meeting. He signs a client, 70 users. We're so happy, you know, like he comes to me.

[00:06:07] It's like we sign a client and 70 users. We're like, yay. What's the name of the dermatology practice? He goes, it's a golf course. And I go, why? Why did you do this? He's like, no, but he's 70 users. And I'm like, no, wrong. Don't do it.

[00:06:26] Why did you do it? So why is it wrong? He's got scarce resources. He's a two man shop. Right. Two man shop adding a new. 70 user client. Yeah. Because it's all freaking automated. Right. It's all automated. Right. So it's easy. You just go, you tell, you do your...

[00:06:46] We have a prescriptive sales model. You tell them the problem that they have. They agree that they have that problem. You tell them that you have the solution. They agree that they want the solution. You tell them how much it costs. They give you the money.

[00:06:58] It's really straightforward. Right? Right. But then he gets so good at that conversation, then he applies it to another industry. Now that comes in. Right? It breaks everything. For the next two, almost three months, he can't onboard anybody else. Why? Because they have five buildings.

[00:07:18] They have three different POS systems that he's never seen before. They have an irrigation system. Oh wait, they have a tea time system. Oh wait, no, they have a cart asset management system. Oh wait, they have... So now you're learning all this stuff that you don't know where...

[00:07:36] The other way, you knew exactly what you were doing. You could onboard by pressing a button. Right? Because you've automated so much of the onboarding that you pretty much press a button. Most of it happens and then you just come in and tidy up a little bit.

[00:07:52] But now you're not doing that. Right? So we were looking at his allocation chart of hours the other day. And he's like, for a week, it's like 18 hours of golf course. You know, 45 minutes, everybody else. Yeah. That's the big fish syndrome there.

[00:08:13] You try to get the whale or whatever it is for you. Now will that noise die down eventually? It will die down eventually. Right? But what is the opportunity cost? Because for three months he couldn't onboard clients. So what if you just kept onboarding,

[00:08:32] he would have gone to onboarding two clients a month, then onboarding three clients a month, and onboarding four clients a month. Because he just kept doing what's in the machine. Or you could go learn something completely different that you don't know anything about that's going to take you

[00:08:47] and your only other staff member completely off track and have you take your attention off your existing clients and cause more noise than what it's worth and support is gonna suffer. And do I have to keep going, David? Yeah. I feel like if you said dermatologist

[00:09:05] and then we were gonna also move into some other clinic that was similar, that would be one thing. I have no problem with that because- But dermatologists in golf courses seem like they're not in the same universe. Right? So if you bring in another, like if you say,

[00:09:18] okay, well now this is an ophthalmologist. Well, you got an option. You can say yes or no, right? And an ophthalmologist is a little tricky, right? Because a dermatologist doesn't have a lot of equipment. An ophthalmologist has anywhere between 15 and 25 pieces of equipment that interface with the network

[00:09:38] in their practice. They'll learn all of it. Big difference. Right? Yeah. Now if you said dermatologist and psychiatrist or psychologist or dermatologist and general practitioner or dermatologist and then that's apples to apples. But then you can decide, do I want to add this layer of expertise?

[00:10:02] I have 80% of the process already laid out. Now we need to add this additional expertise here. See, the more you move toward your client, the more you know, the stickier you are. The problem, you know, I don't know if you know Juan Fernandez,

[00:10:19] but Juan always says, you know, you could be a janitor, right? Or you could be a specialist. And if you want to be a janitor, have at it. But know that you're competing on price. Now, if you want to be a specialist, right?

[00:10:41] So when you look for yourself, what is that special? What's the special thing that you can do for somebody for a type of MSP that you can't do for any other type of MSP? Mm-hmm, yeah. That makes a ton of sense. No, I'm asking you.

[00:10:58] Don't say that makes a ton of sense and try to skirt my question. Joe's not, you're not letting me off. Yeah, this is the hard stuff, right? This is, yeah, so I didn't know at first, I think I'm getting there.

[00:11:15] And you know, what we've learned is the fact that we managed it and tested it, the folks that gravitate towards this tend to be compliance, tend to be regulated because they have to show evidence or proof that the backups have occurred, that testing has occurred,

[00:11:33] that just different things have happened and on different intervals. And if you've run an MSP, you know how many fires there are and how depending on the operational maturity, especially when you're smaller, but sometimes you just don't have operational maturity when you're larger.

[00:11:47] The reason why you don't have operational maturity is because you are stuck in putting out all the, it's action and tactics. Going back to the definitions I gave you at the beginning, right? You're throwing spaghetti. All you can do is put out fires

[00:12:05] because the only thing that you can act on is the short-term result. There's no long-term strategy. So you were saying, so they're there putting out fires and then they're, so, but you found that the people that gravitate to you are the people that have these high compliance frameworks.

[00:12:29] High compliance, it's a few different things. Like you were saying growth. If you're growing at one or two a month, then this is a managing backup saying, it's a bigger issue. If you're like the average MSP that adds two or three clients a year,

[00:12:44] you can say, oh, we'll cover that up. We're not really tracking the labor too well. We'll just throw resources at it. And maybe you have underutilized resources. So you don't actually see it as a hard cost by the time we help you recover. But the more you're growing,

[00:13:00] the more you realize you're gonna be writing a check in one way or another, whether it's to us and or to more staff. And what most have realized is they're still not gonna get the testing and the peace of mind and the other things that they need

[00:13:13] to show themselves, to show the client. But now the auditor, the cyber insurance carrier, whoever that is. And so if you're growing and if you have any markets that are compliant, then this, like you said, is prescriptive. I had a new head of customer service join

[00:13:37] and who's one of the few folks from my team is outside the MSP industry. And so he's kind of shadowing some of all the different calls, not only in technical but just even meeting new MSPs. He's like, you just told him no.

[00:13:55] He's like, I've never seen anybody on that. You met him for the first call and they're like, do you do that? Nope, do you do that? Nope. And then you're like, this is what we do. And he's like, I've never seen that happen.

[00:14:05] And he's like, I've been to all these companies and we just have to scramble. We have to say, well, kind of, or maybe, we could make that work. And I was like, that's a recipe for disaster because you can't deliver with integrity, as you mentioned.

[00:14:18] There's very few things we can deliver on repeatedly with integrity and that's already, that's already changed the view. I did, I did, because I wanted to look at you. I'm like looking at the camera, I'm trying to look at you and then I'm looking sideways.

[00:14:36] I said, I slid my camera over so I could look at you. Gotcha, gotcha. No, one of the things that we're blessed with is just, when I was at MSP, I had to be good what felt like 50 or a hundred things.

[00:14:50] And then, at Cervosity, we do one thing, kind of an inch wide, but a mile deep. But even so- You still haven't defined who you do it for. You have to define who you do it for. You have to be very narrow in that scope

[00:15:05] because we'll never be the cheapest. We can't add all this extra value and do all these extra things and be the cheapest. And, like you said, prescriptive. We now tell people what we do and that resonates with the right people,

[00:15:20] the right MSPs, and it doesn't with a lot of others. And if you're not growing, if you're not in a compliant market, if none of that is affecting you, you can probably pull this off or some version of it, less expensively somewhere. And so, yeah. And I don't...

[00:15:39] Either one's a great outcome. Like I'm not prescriptive. Yeah, it is. So now what you have to look at is as you're narrowing yourself down is which compliance frameworks are the ones that you're likelier to get? Then you want to find MSPs

[00:15:54] that are servicing those compliance frameworks, right? Like that's their niche or avatar is servicing those compliance frameworks and saying, okay, this is who I'm going for. These are the kinds of companies that... And then you start writing content about that and you start putting things together

[00:16:13] that answer that MSP's questions. Because I promise you that that MSP is out there online looking for solutions for their problem, right? But if your content is generic, it's about backup. That's right. Who cares? It's not gonna help anybody. But if you're... How do you do FINRA compliance?

[00:16:38] How do you do FINRA compliant backup and recovery and monitoring? 10 things you need to know to do FINRA compliant backup, right? Now you're... Now you're speaking to the exact person that is looking for you. And that's a thing that scares people. But I think that there's two reasons

[00:17:05] why people are scared to go back to your thing, right? One, they think it's gonna limit the market. But I think that that's the external fear. I think that there's an internal fear. What do you think that internal fear is? Fear of saying no or fear of focusing?

[00:17:23] I don't know. I think it's more like you actually have to do the thing you say now. Stay to the same talk track, yeah. You're actually on the line. Where the other way it's not, right? Because it's kind of fluffy. Like you do everything for everybody.

[00:17:45] So you do the best you can. But here, if you say you're an expert, well shoot. And so what happens is a lot of people are shy to start because nobody's an expert on anything. At least when I started my MSP,

[00:18:03] I took whoever gave me a check, right? So I wasn't an expert. If their check cleared, that was my ideal client. I'm gonna be a client, right? As if the check cleared. I'm good to go. The issue here is that if you're going to go

[00:18:19] and narrow down, when you first narrow down, you just gotta do the regular stuff for that narrow client. And then you have to start to figure out their stuff. You can't be afraid to narrow down. You can't wait to become an expert, right? To then go service.

[00:18:41] You have to start servicing that niche and as a function of servicing the niche, become an expert in it. It's a lot easier to see patterns. Yes. When you say I'm gonna go get four or five, six, eight dermatologists than it is when you have... 25 different...

[00:19:01] 40 different individual customers. Yeah, it was great. When I was doing architects, I could walk into a new architecture firm, a newly founded architecture firm and say, hey, these are probably the problems that you're having right now. And they would go, oh my God,

[00:19:16] do you have cameras on the wall? I was like, no. You're having this problem, that problem, this problem, that problem. And here's what's causing those problems. And here's my proposal. Oh my God, you're three times more expensive than the next guy.

[00:19:28] It's like, yep, I'm not gonna be the cheapest one, but ask them these questions. They can answer these questions, they can help you. If they can't, they can't. Or they're just gonna learn with you, all right? Yeah, yeah, you're paying them to learn with you.

[00:19:45] So what kind of examples did you learn about that architect industry to say you're having these issues? One of the main issues way back when, when I was doing was drive speed, right? So way back when, you're trying to render files on AutoCAD and everything is just moving,

[00:20:05] but you're using 5,400 RPM drives, dude. Of course it's gonna be. So when I first started, I was using, I moved to SCSI 20,000 RPM. And then as soon as the first SSD came out, I started building RAIDs with 80 gig SSDs, right? So I had like a 10 drive RAID, right?

[00:20:27] And as soon as the fiber switches came out, I got fiber switches, right? So I would put six workstations with a fiber switch on the other side of the wall, right? So I put everything up against that, whatever the server room was, I put the six workstations there,

[00:20:40] put a fiber switch on the other side, run fiber to the switch, right? And now you could work on the server live instead of having to take that 40 gig file and move it to your workstation and work on it and then move it back to the server,

[00:20:57] which is what they were doing back then, 2007, 2008, 2009, right? Now you can work on that file live directly on the server. So I would talk about all these problems that they were having. Oh, by the way, yeah, you can't get your printer software to work properly.

[00:21:17] Here's how they have to account for printing architects because they plot and all that stuff and everything they print gets built, right? But now the billing software is not integrating with their payment system, right? So that's always a problem.

[00:21:34] How do you get those two things to talk to each other? What time management system are you using? How are you tracking everybody's time? Are you guys still tracking time on spreadsheets? Oh my God, right? So then like moving them to an actual time tracking system,

[00:21:49] moving them to an ERP that's designed for architects. Yeah, I love those examples because I don't know anything about IT for architects, but I understand plotting and I understand AutoCAD is gonna take a lot of disk. And I also understand that everything you just said,

[00:22:05] you didn't say, oh, you probably have issues with your computer rebooting every once in a while. You didn't say generic IT stuff. You said specific things to your architecture firm. Yeah, when I was talking to architects, I didn't talk like that. What I said is you're having trouble

[00:22:23] delivering your projects on time and on budget. And mostly you think it's because of your architects, but I promise that about 70% of it is your technology does not align with your workflow. Now you're talking business. Now you're talking revenue, right?

[00:22:42] Because they could give a crap about the technology. They don't give a crap about it, they don't. That last point alluded to it, like the plotting and the billing system, right? Alluded to it, but then I would talk, then they would say, well tell me more.

[00:22:54] And then I would talk about that stuff, right? But you can't start with that stuff. You have to start with the problem that they are having, not the problem that you wanna talk about, not the thing that you do, but the problem that they are having.

[00:23:10] See the problem that the MSPs that you serve are having is that they cannot quickly enough deliver answers to their high demanding super compliance needing clients. And with your platform, they can. And so that's what you gotta talk about. That's the only thing you talk about. Yeah.

[00:23:40] I love that. If you focus on that, then those are the people that are gonna come to you because that's a problem that you really solve. I've looked at your stuff. It really solves that problem. Yes, yes. And it keeps you out of the speeds and feeds, right?

[00:23:54] You don't have to get into, and then if you wanna talk about immutable storage or how we achieve compliance or other things that we can get into those details, but we can talk about a business challenge, which is the only thing that really gets you to spend money.

[00:24:11] That's the acute pain that we were talking about. Right? That acute pain, oh, oh, oh. That's the only thing that's gonna get you to take action. So going back to your example, I know we just happened to pick one of the three MSPs you niched as architect.

[00:24:30] Was there a niche within architecture or did you know of one? Like if they're growing faster, they're a better fit? I had a geographic niche when I did architects. Right? Okay. 10th street to 57th street, second avenue to eighth avenue. That's pretty specific.

[00:24:50] I had 11 architects in the same building. Wow. Right? Just keep one tech going up and down the elevator. I just kept them in the elevator all day long. It's a big building, right? And if I would have stayed in that niche longer, I would have probably gotten more.

[00:25:07] It was the Empire State Building. So a lot of architects in that building. Right? And so that's it. If I focused on that building alone, I could have built a $20 million business just in that building, just on architects. So let's go back to the beginning a little bit.

[00:25:23] Let's say I'm an MSP and I am like so many doing everything for everybody. And if I understand your advice is pick a niche and start. Get started, don't wait to become the expert, which is great advice. How do I know which one? If I've got, you know,

[00:25:41] maybe I've got two of one customer. I don't know. Is that the reason or if I've got 40 different ones? So I can give you a bunch of different ways. Okay? Okay. I have a guy that just recently started an MSP. He spent, before he started his MSP,

[00:25:57] he spent 10 years as the CIO of a bank. You're thinking niche. Right? Right. Not retail. Right? So that's one thing. What level of expertise you bring to the table already where you understand the problems of the industry and you can speak about them intelligently, right?

[00:26:19] Because it's really about being able to speak about the business problems. Okay? That's one way. The other way is you take a piece of paper, you draw a grid, you put all the potential niches in, take a penny and you drop it.

[00:26:33] Close your eyes and you drop it. And wherever that penny lands, that's your niche. Right? If you have no idea which niche to pick, that's as good a niche as any. What I will tell you is whatever it lands on,

[00:26:47] you can do a million dollars in that, right? Because a million dollars for an MSP is 20 clients at $4,000 or 40 clients at $2,000. It's not hundreds and hundreds and thousands of clients. It's not. It's just 20 clients or 40 clients. That's all it is. Right? So we usually say 30

[00:27:11] because you're always somewhere in the middle. Right? But if that's what it is and you get to 30 clients and you're making a million dollars and you freaking hate it, sell it and start another one. But now you got money. Now you have money.

[00:27:26] Make a couple of hundred thousand dollars. Right? You take a nice comfortable small exit and then you start another MSP. Yeah. And I'm sure as you know, but because I work with so many MSPs, if you're listening, even if you exited there, which would be, you know,

[00:27:47] you probably wouldn't, but let's say you did. Just because I work with so many MSPs, I get calls. Who's interested in selling? Like the market is really, really good right now and they will pay a lot more when you have an M. Yes!

[00:28:03] Because it's far more valuable to them. They can replicate. At the summit we had an M&A advisor come and speak. You know? This guy's brilliant. His name is Mahan Gundedjum. We actually just did a live with him on LinkedIn that you can check out. That's really cool.

[00:28:18] And he did this case study for us. Two, three million dollar MSPs. One got two X, one got 10 X. Wow! The only difference was that this one was niche and had contracts and this one was not in business. That was the only difference.

[00:28:42] Everything else about this was the same. They had been in business for about the same amount of time. They were at the same revenue mark. They did it, everything else was the same. That's crazy. But think about it. When you're niche, you have a delivery process

[00:28:58] that is like proven. Mm-hmm. Right? Your client longevity is gonna be much longer because you can do things that other people just can't do. You understand it. You can fix it. You know what their line of business application is.

[00:29:15] I can't tell you how many MSPs I will onboard and I will ask them, well, we have this, what do we call it? It's like a professional something temperament assessment. We call it the PETA assessment for clients. Right? And when we do that assessment,

[00:29:39] I'll look at a client, right? And they're low revenue but they have a high PETA number, right? And I'm like, what is the line of business application for this client? I don't know. Yeah, well that's why that number is so high

[00:29:56] because they hired you to be an expert and you're not delivering that expertise. See, the mistake that MSPs make is that they think that people are hiring MSPs. They're not. People are hiring somebody to fix their specific problem in their specific industry period and the story.

[00:30:17] I just, I feel like you need to hear this, right? I hear from the end client. We all sound the same. You know, blah, blah, blah, blah, speeds and feeds and our support's better than anybody else's and then the other guy comes and says the exact same thing.

[00:30:32] I did, we were doing screen captures of MSP websites. We had over a hundred back to back that said we handle your technology so you can take care of your business. Hundred snapshots of different websites back to back that's what it said on the homepage above the fold.

[00:30:53] Yeah, no wonder it's a race to the bottom of the price if we're all doing the same thing, if we're all making the same promise. It says we help K through 12 superintendents educate better. Who do you think is going to win that bid? That's a no brainer.

[00:31:12] So pick a niche and then start delivering for that niche and then the next step is... And then start understanding the problems for that niche and start going down and start creating processes to solve the problems and start going to their conferences and start writing articles about their

[00:31:28] and their periodicals about their problems. Understand their business problem. Like one of the business problems we discovered in dermatology is that dermatologists often have a hard time getting their clients on a subscription for the product that they're selling them, right?

[00:31:46] So we came up with a solution for that. Like it's a simple Shopify solution for creating subscriptions, but he comes in and he can set that up immediately and put the products up and have it up and running in like 72 hours.

[00:32:02] And now a patient comes in, you send them a text message, they click on the thing and they're signed up for the subscription. That's awesome. Right? But that's because we understand what the specific problem is from the dermatologist point of view. Yeah, question you would never ask

[00:32:21] if you weren't thinking about the business problem. No. You're talking about HIPAA compliance and yeah, we're gonna do the best HIPAA compliance ever. How does that help them make more money? Right, not at all. And if you're gonna be a great MSP,

[00:32:40] you have to be a partner, a trusted advisor. See everybody wants to wear the trusted advisor moniker but they don't wanna do the trusted advisor work. That's very true. I think we get, speaking from experience myself, sometimes we get frustrated or mad.

[00:32:59] Like, why don't they see it as a trusted advisor? Why don't they treat me as a trusted advisor? Why don't we have that rapport relationship? But I haven't done the work to ask the questions. You're not treating them as a mentee

[00:33:23] that you care about the outcomes of their problems. Mm-hmm. You're trying to see what you can sell rather than what you can solve. The more intricate the problem you solve, the more money you make. That sums up wide a niche right there. Right?

[00:33:46] So you can look at the problem. So you get paid, a lot of people say that you get paid proportionate to the complexity of the problem you solve. I like what my partner Jeff says. You get paid proportionate to the simplicity that you deliver. There you go.

[00:34:01] Because IT's plenty complex. And we don't mind telling the client, unfortunately. We usually show up and throw up. Oh, the speeds and feeds. Exactly. Yeah. Right? Yeah, we just... But giving them the same complexity doesn't help at all. Not at all. Not even a little bit.

[00:34:18] They don't want to hear the complexity. They want to hear how their business is going to do better. So don't spend any time talking about technology. Spend time finding out, what do you... How do I help you, doctor, get more patients? Well, if I could only do this.

[00:34:34] Well, why aren't you? Well, because this and this doesn't work. Oh, that's a simple fix. You can have that up and running next week. Right? What else? Right. Really? Really? Now what else you got? Okay. Well, why don't we get that up and running? We measure it.

[00:34:51] We see how we deal with that. And then if that really works, the way you think it's going to work, then we'll do the next step. One step at a time. One step at a time, right? But that's how you're going to learn also.

[00:35:04] Because you're going to learn by going in and seeing where the problems are. One of the things that I used to do all the time, especially when I was working on your niche, is go and sit in their office for a few days.

[00:35:15] I'd call a good client up and say, hey, do you mind if I just work from your office for the next couple of days? I just kind of want to look at your work processes and ask some questions.

[00:35:23] I need to understand what you do a little bit better. Right? Then I would find who the people were, the key people in there. And then go ask important questions that help me understand better what are the problems that I'm solving? Right?

[00:35:43] I see somebody throw their arms up in front of their computer. I walk over and say, hey, what's going on? Well, this thing, you know, there's nothing you can do about it, but here's this problem. Right? They go, oh really?

[00:35:57] You think there's nothing I can do about that? Let's check this out. Oh my God, it works! Yeah! You know? But you can't, you have to spend that time to be a trusted advisor. You have to understand the problems you're solving. You know?

[00:36:15] And the reason why, I wish I... I've kind of shied from talking about this more. Right? And the reason why I'm shy is because people don't want to hear it. They like run away when I talk about it. But I think I gotta just talk about it more.

[00:36:32] Yeah. Yeah. It's like tough love, right? You need to realize. Well, the thing is, I can tell you that we have the folks that are good fit that we realized that they're in our niche. And then we have everybody else. And some of them still, you know,

[00:36:51] they were there before or they crept in. But everybody else, they don't have their niche. Like the ones that are best fit for us usually have a niche as well because they're in a regulatory or some other environment and to deliver that,

[00:37:04] well, they need to be in that niche. And everybody that's not in the niched environment, all they talk about is nobody trusts me as a trusted advisor. And it's just, you know, I have cheap clients to race to the bottom and ultimately like, you know,

[00:37:23] can you lower the price? So I can lower the price. So I can lower the price. Yeah, no. They're not your clients. Right. That's exactly right. Well, that's what happens. They churn, they end up moving on and that's what should happen. It's hard.

[00:37:37] I knew when I started doing that and having the willpower, I guess, to do that because the first time or two, you're like, oh no, somebody left. Like that's not good. We want to keep people forever, but we have good churn. Yeah.

[00:37:53] We have people that are not the right fit that will move on. We had a lot of that last year. Yeah, that's exactly right. Because we know who our ideals are and we had a lot of good churn last year and it was really great.

[00:38:06] It's really great because it was great for the coaches. It was great for everybody because we knew like these folks are not a fit in our ecosystem. They're not, you know, you're not MSPs really. I wish somebody had tapped me and said there's such thing as good churn.

[00:38:23] You know, because we're taught churn is bad. Keep every dollar, right? Keep every customer. Don't ever, once they say yes, don't ever let them, you know, and I think being a tech guy, being an MSP that was a tech guy, I was not speaking business.

[00:38:38] I was not exactly great at sales. So when you're picking up two or three or four a year, losing one or two clients feels like a crisis. You can build a funnel that consistently delivers one client a month, consistently. That's totally, knowing you, I believe you.

[00:38:56] To everybody else that won't make this jump, that seems like you're telling them they can build a rocket ship to the moon. You can totally do it, but the only way you can do it is this way. The only way you can do it is this way.

[00:39:11] Because the other way is brute force. I know, but brute force doesn't work. At what point do you realize a brute force... If you're getting 10,000 to one or 1,000 to one, right? Versus three out of every hundred. And you can get more. You can get 20 out of every hundred

[00:39:32] if you really focus all your marketing efforts on that hundred, right? So we have a strategy called, like we have a strategy to help you niche that takes you through the whole process. How do you think about the niching? This is how you think about the niching

[00:39:46] and then you can, okay, and how do you actually do it? What are the steps that you have to take to actually niche? This is how you actually niche, okay. And then how do you talk about it, right? And then how do you target?

[00:40:00] And then who do you target? And then where do you target? And then what are the actions that you need to take to go from stranger to advocate? Right? Take them through that awareness. Take them through that, like all the way through that engagement, right?

[00:40:19] Take them to that subscription, conversion, excitement. Then they buy your core product. Then you ascend them through your core product. But to do all those things- Yes, then they keep buying. Yeah, then they keep buying. But to do that, you have to know

[00:40:35] what the conversation is at each interface, right? And you have to really do the work. And you have to really do the work. So it brings you back all the way to the beginning, right? You can do actions and tactics, or you could do strategy.

[00:40:55] If you do actions and tactics, you're always going to stay superficial because you'll do actions and tactics and go, oh shit, that's not working anymore. And then you'll turn and do something else, right? And then you'll turn and you'll do something else.

[00:41:06] And then you'll turn and you'll do something else. But you'll be 50 miles wide, one inch deep, right? I like what you said before, right? You're one inch wide, 50 miles deep. Yep. That's the way to go. How long does it take if I am sitting here going,

[00:41:24] that's me? 12 to 20 minutes. I sell to everybody and I need to niche. So how long does it take if I say I'm all in, I buy it, I get it, I'm ready to niche and I'm going to pivot because like you said, you gotta change.

[00:41:37] You gotta change your conversation, you gotta change your content, you gotta change who, you gotta figure out the niche, you gotta, in my experience once I think I have the niche then I don't have the niche. I gotta dig deeper, I gotta be more focused on that niche.

[00:41:52] How long does something, not that it matters because you need to do it, but how long? 12 to 18 months, okay. And I'm still doing what I'm doing now. I haven't given up. It's not like my business just goes away. You can't because you're paying the bills, right?

[00:42:08] So you have to maintain the clients that you have. So we have a strategy for that, right? So what's the strategy for maintaining the clients that we have? If you've ever taken our SBIR course, it's free. You can go to our website, get it for free.

[00:42:19] We would take the SBIR course, that's the strategy for maintaining the clients that you have right now, right? So you maintain those clients that you have and then you start to figure out a little bit more about them because the interesting thing about when you niche

[00:42:31] is that you start to look at all your clients and go, what is their business? What exactly is it that they do, right? And how do we help them deliver that better? And then what happens is you get a little bit more money

[00:42:41] out of your existing base, right? Because you're actually looking and paying attention and you might discover a different niche while you're doing that, right? You might just go, I like this better, right? But now you've picked your niche. Now we have to go deep there, right?

[00:42:55] So now we have to go get those clients. So while we're doing this work, we have to maintain what's paying the bills over here, right? And it takes about three months to really design the campaigns to go after these people

[00:43:06] and then another three months to start onboarding clients and then after that, it gets pretty consistent. Then you're going, you know, once a month, you're onboarding a client because the conversations that you're having just lead to that. It's kind of inevitable at that point.

[00:43:23] Inevitable to have a new client a month. That seems crazy for the average MSP. Well, it is only because you're very, very, you actually know the names of the hundred people that you're going after. Mm-hmm. Right? When you're at that level of focus,

[00:43:44] and you can spend money on those people, instead of spending $3,000 a month on ads that lead to nothing, spend the $3,000 a month and take 10 of those people to dinner and talk to them about their industry problems. Bring in a great speaker to talk about their stuff.

[00:44:03] One of the strategies that we're using with one of our MSPs is focus on accountants, is to offer, to hire a CPE trainer and offer a free CPE course that they have to take anyway, right? To 100 accountants. So they offer free, they pick the hundred accountants

[00:44:22] that they wanna work with, then they offer the free CPE course, right? And then they come in for the CPE course, you feed them, and you get to talk to them at the beginning and you get to talk to them at the end.

[00:44:34] And so they attach the CPE course to you. Yeah. It's like, yeah, this is what we do for our clients. It's like, we know that our clients need these, so we make sure that our clients get at least three opportunities to get their CPEs in every year.

[00:44:50] Your niche is not-for-profits. Hire a grant writer, a full-time grant writer, to write the grants or pay them for yourself. You go and compete with another MSP for that not-for-profit, and you say, oh yeah, by the way, we have a grant writer on staff

[00:45:12] that writes the grants for our technology to pay for ourselves. See, the more you understand the niche, the more things that you can do that have them say yes. Or I'll check that out, because that accountant is either gonna pay for that CPE course,

[00:45:34] or he's gonna come to you. Right. That not-for-profit is gonna have... Yeah, if it's not the first time, the second time. That not-for-profit is either going to have to hire the grant writer to write the grants, or they just go with you

[00:45:50] and you write the grants for them. And that's way better than all the people that are like, I have some non-profits, so they can't pay me, and I have to give them... Do you know how much money there is out there for non-profits? For technology, a ton,

[00:46:03] but the problem is that the smaller non-profits can't afford the grant writers to write the grants. So if you're gonna focus on non-profits, hire a freaking grant writer. It's gonna cost you 80 grand, 90 grand a year, but it's gonna pay for itself 10 times over.

[00:46:20] That grant writer can write $2 million worth of grants that year. You're paying him $120,000 a year. He won't care. And there's no skin off the not-for-profits back because they're not doing anything. All they have to do is be the recipient of the services.

[00:46:40] You just can't write the grant for yourself. You have to write it for them. What's the... Anybody listening, what's the next step to dig in to really figure this out? I mean, this is interesting. I wanna figure out, Manito, I wanna figure out how to hone deeper.

[00:46:56] Well, one step is they could book a call and they wanna talk. I'm happy to talk to people. But the first step is really to look... You have to look and see what... Who are you happy working with? Which is a client that makes you happy.

[00:47:15] That's a great question. Right? Who are you happy working with? And then, do you understand their industry? And if you have... Like, you know, like when I first niched, somebody asked me a great question. They said, who's your biggest P&ES client was the hardest one to onboard,

[00:47:31] when's the one that gave you the most trouble and you had to learn the most about their stuff to actually be able to service them? And I said, personal injury. They go, that's your niche. I go, but I hate those guys. Yeah, but that's your niche

[00:47:42] because you know everything about them because they were so hard to get to work and now you have them working, that's your niche. I got 11 clients in the first year. That's crazy. Nuts! Was that your first or your second? That was my first. My first. It was painful.

[00:48:01] Then I really discovered that I don't like P&I lawyers. No. There's a few out there, you know who you are, that I like you, but the rest of you... Yeah. Right? And so I ended up, you know, selling that and getting out of it

[00:48:19] and that's why I started with architects because then I really enjoyed working with architects. Really. It was so much fun. Right? So you enjoyed working with them, you niched and then, and it's been a spinning years. If I got this right, it took you 16 months

[00:48:34] to get to a million in revenue. I don't think if you're at a quarter million or a half a million, there's a lot of people who think it would take them longer than 16 months to not start but to just grow from, you know, 250 or 500 to a million.

[00:48:50] It would take longer than that. It doesn't. It shows the power of focus. You started entirely brand new in this business, right? I'm stressed. Well, one of the guys from the previous MSP came and everybody else stayed in the first. Yeah. Okay.

[00:49:04] So yeah, you and one other person, that's pretty much it. Me and one other person, didn't hire anybody until we got to a million. It was just the two of us. That's pretty profitable for a two person in a million.

[00:49:15] What we did is we used a lot of Field Nation, right? So they did all the boots on the ground stuff. He stayed back and I sold. You know? And then at some point, our first hire was an office manager. Yeah. That's crazy compared to just hiring techs

[00:49:33] and sending them out. I know, but I'm a big proponent of using field services for field stuff, right? What you do is you have to have what I call the IKEA process. So you have to have the stuff shipped to you,

[00:49:51] build everything out and build an instruction set that looks just like IKEA. Like this is how I want you to rack. This is how I want you to stack. This is how I want you to put the workstations together. Here are our pictures.

[00:50:03] This is how everything needs to look like. You put that instruction set in the box. You ship it to the client and you send a technician. When you do that, that technician can come outside, take this stuff out of the box, follow the instructions, take pictures,

[00:50:16] call you up, say, okay, this is what I did. And then you're good. Yeah, that way not changing quality because you set it up. You built the process ahead of time. So if you build the process ahead of time, then you can scale a lot faster, right?

[00:50:33] Because you can put boots on the ground anywhere in the US. And Fuel Nation has 28,000 technicians and there's other competitors of Fuel Nation that I don't remember than the other people, but you can use any of those and put boots on the ground.

[00:50:47] I think that's the other Achilles heel. What? Right, for an MSP, you grow, you don't put process. You have your trusted people and it's either just you or you have Suntech that if they walked out the door, you couldn't deliver. Yeah, so you build a person-centric business

[00:51:05] and you have to build a process-centric business apparatus. Your business itself has to be human-centric, right? It's like it cares about humans, but the delivery process needs to be process-centric, not person-centric. Because if the delivery process is person-centric, then you're beholden to the people.

[00:51:28] If you take everything and turn it into a process, then it doesn't matter who's sitting in that chair. Right? Right. It does to some extent, right? You want them to be in your culture and well indoctrinated and understand what your mission and vision is

[00:51:42] and what your outcomes are. But it's less important because you've built a process-centric thing that somebody can just go look up the process and follow the process and then they can do it. I think if you force yourself to use field nation or something like that,

[00:51:57] you're gonna have to build that process or you're gonna end up, because they don't have any culture, they don't have any context, they don't have any of those things. So even if they're technically sound, you're gonna end up with a whole variety of outcomes,

[00:52:10] which you probably already have with your internal team. They just have a little bit more context for culture. Yeah, they have a little bit more context and culture, but it does, even with that, right? If you don't have a process, everybody does it differently.

[00:52:21] Tell everybody how they can get started on their journey, how they can connect to you, StartGrowManage if they want to reach out or get your help. Go to StartGrowManage.com, right? And there's a bunch of really great ways to get started there. They could Google, if they're small

[00:52:43] or they're just getting started, they could just Google MSP Business Plan and we're the first organic one and you can go grab that and that's gonna take you through step by step and help you get on your journey to niching.

[00:52:57] Or you can just reach out to me, right? So it's Joe at StartGrowManage.com. I'm happy, send me an email. I'm happy to talk to everybody. I'm not for everybody, but I'm happy to talk to everybody and point you in the right direction

[00:53:10] whether we work together or not. So that's kind of how to get it home with me, right? I love that. Well, if you're listening, don't miss out on the opportunity to take advantage of Joe and his kind opportunity to help you with that. If you're listening,

[00:53:31] make sure you check out their podcast, Start Grow Manage with both Jeff and Joe. Check out his book on how entrepreneurs thrive, your roadmap to success. Check out Start Grow Manage. There's so many ways that you could learn from Joe.

[00:53:46] Joe, this has been a tremendous blessing for me. You're one of my favorite people. Thank you for being on the show today. Oh, thank you for having me. You're one of my favorite people, so it's great.