In this episode, Jeff Loehr, Joe Rojas, and Gavin Garbutt emphasize the importance of MSPs aligning IT solutions with clients’ business objectives through focused conversations. Gavin delves into niche verticals that can yield success, as seen with Caltech and Corsica.
We also discuss the evolution and future of MSPs. This includes managing cloud services, especially with Microsoft, and harnessing AI and big data. We spotlight Augmentt’s multi-tenant solution for top-notch security monitoring and SaaS auditing. Plus, learn about the Augmentt Academy’s valuable resources for MSPs to excel in selling cloud security services.
Tune in for insights and tools to navigate the evolving MSP landscape
Gavin has been a founder in several successful startups, responsible corporate governance, strategy, restructuring, and corporate financing for private and public companies. Among many industry accolades, N-able was ranked on Deloitte Canada’s Technology Fast 50 three years running and Deloitte’s Fast 500 for North America.
CRN magazine has three times named Gavin one of North America’s top 25 Most Innovative and Influential Executives of the Year.
As former Principal and Board Member of THP, Gavin had the pleasure of helping his daughter, Amanda Riva, build THP into North America’s leading content and digital marketing firm, resulting in a highly successful sale of the company in 2018.
What is the problem you solve, and for whom?
Managed IT & Security Services are evolving to include Managed Cloud Security Services. As IT moves to the cloud, many industry leaders believe this will be the natural evolution for all successful MSPs. Augmentt helps MSPs sell and deliver security services for SaaS software. Gain clear visibility into who is using which cloud applications and how often. Identify and eliminate risk across all your M365 tenants. Leverage customer facing reports to show how you are securing their employees and data. Learn how you can easily increase your MRR and win new business by adding SaaS Security to your service offerings.
How do you help MSPs
By helping them simplify M365 security, monitoring and enforcing security configurations and policies.
Your Company Website/URL
What you are promoting:
We offer MSPs a full NFR for their company as well as 100 free external licenses to use for prospecting and sales.
Also, Augmentt Academy, where we have complete sales, marketing, pricing content assets for the website, for emails, and for everything that MSP needs to do to sell these cloud security services.
Joe Rojas: Gavin, have you met my partner, Jeff?
Jeff Loehr: I don’t think we have ever met Gavin.
Gavin Garbutt: No, I don’t think so. Nice to meet you, sir.
Jeff Loehr: Great to meet you, Gavin. And Joe was talking about all of the great things that you’ve done in building businesses over the years. So we obviously wanna talk about Augmentt, but I’d love to hear about some of the stories that got you here, N-able, and the other exciting adventures along the path and understand a little bit of your entrepreneurial journey.
Gavin Garbutt: Yeah. I’ve actually never worked for anybody. Except for when I was in high school and at the beginning of university, I was a bellhop at a big summer resort hotel.
Jeff Loehr: That sounds exciting. Yeah.
Gavin Garbutt: Yeah, I got in lots of trouble. But that’s where I met my wife also. So good things happen also.
Joe Rojas: That’s the kind of trouble you kept getting in.
How Gavin’s Entrepreneurial Journey Started
Gavin Garbutt: You know what I started off in the, actually funnily up in the fitness industry. When I was very young, I had a chain of health clubs, nine clubs.
After we had our first child, I sold out of that, and I got into financial services and with a couple of colleagues, we created an organization in Ottawa called the Business Planning Group. And we had an accounting firm, a law firm, financial services, which I own, an insurance brokerage firm, which I own, and a venture capital.
Jeff Loehr: Oh, that’s cool. Which I like that idea.
Gavin Garbutt: Yeah. We were about 60 people, and we would provide full academy legal, financial services to technology companies, which was our primary focus. Then, one of my early ventures was an industrial semiconductor company, which we grew from 15 to 540 employees.
Took it public, then sold it to South Korean Company, a big industrial semiconductor company. So that was fun. Then, I got into the software after that in the mid-late nineties. And it was actually AI-related software, funnily enough, now that AI all of a sudden is popular, I chuckle because AI’s been around forever. It’s just the implementation of it.
Jeff Loehr: Yeah, it’s interesting. Right now, everybody’s interested in AI with these large language models, right? But actually, AI has been doing interesting stuff for a long time.
Gavin Garbutt: We sold our company to IBM just before the.com crash.
Jeff Loehr: Well done.
How Gavin Started N-Able
Gavin Garbutt: Got a little lucky. And I started N-able actually after that, and that was September of 2000, so right in the middle of the explosion. And everybody said, oh my God, are you insane? Starting a technology company like tech will never come back. And I believe and still do that everything is a cycle.
And by nature, people want to achieve more and improve themselves and their lifestyle, so they will invest and do more. N-able was a really interesting one to start because I had just finished with these two companies, this industrial semiconductor and the software company.
I was looking for my next venture, and it was funny. It was Christmas time, and it was at a cocktail party. And I was chatting with this var who did about a $10 million a year of turnover. And I said to this guy, Larry, what’s the one thing you could do to your business going to next year that could really improve it?
And, going into the Millennium 2000 and, big deal. And he said, geez, we’re a couple of cocktails in, of course. And he said,
Joe Rojas: That’s my favorite time to have this kind of conversation.
Gavin Garbutt: He said if I could only monitor my customer’s IT so that I wouldn’t have to roll a truck every time there was a problem, or at least I could roll the truck with the right part.
Not drive out, see what’s wrong, drive back, get the park, drive back and fix it. And I said, oh, that’s crazy. What if you could actually remotely fix stuff also? And he said, oh, stop it.
Jeff Loehr: Yeah. I could imagine him saying no, I don’t wanna do that. That’s what he actually did.
Gavin Garbutt: So this was the funny part. And I, so I said, what about HP OpenView CA Unicenter or IBM Tivoli, like lots of enterprise solutions for this? And he said, yeah, but you don’t understand. Those are enterprise solutions. They’re not multi-tenant. They’re too complex. They’re too expensive.
Jeff Loehr: Yeah. Yeah.
Gavin Garbutt: And I said, what. Get the heck out of here. I said, I like, this is too big a good an opportunity to. I said, so what about other VARs? What would they think? He said, oh, that they love it. They love it. So I went out and interviewed 20 VARs, and they go, are you crazy? Do you see this screwdriver? I’m a hero when I show up with my screwdriver.
I don’t do stuff remotely. What’s wrong with my business model? I’m a numbers guy. What, if you don’t mind my asking, what’s your profit margin like, what’s your labor cost? What do you do when you get to the office first in the morning? I put out fires.
I never know who’s going where. I’m going like, are you guys crazy? You need this! And anyway, so all 20 VARs that I interviewed said, no, I like my screwdriver. I said, but what if you could take your business from a zero to 3% EBITDA business to a 30% EBITDA business? Would that Oh, really?
Is that possible? And we started N-able, knowing that the market did not want the product. Created the first multi-tenant remote monitoring and management platform for the channel, knowing the channel did not want it but knowing that I would bust their heads open to educate them that they needed to evolve from chaotic to proactive to manage services.
And this was our whole track is: go from reactive to proactive and then to manage services.
Jeff Loehr: And I actually think that there’s a good. Progression. As we figure things out in life, we start reactive, and then we start to get proactive, and then we manage it before it happens.
I think what you really identified there was we’re moving in this trajectory, and break-fix is going to die. Paying for labor is going to die because we’re just going to get smarter about how we do these things. Somebody’s going to get smarter about how we do these things, right?
Because it’s like sitting right there. The opportunity is right there. Eventually, they’re either going to want to get smarter, or those who don’t wanna get smarter aren’t going to have businesses anymore. So I think it’s a great observation of the trend in the market and then putting together a solution behind that, even if people aren’t clear yet that they’re going to need it.
Gavin Garbutt: It’s all about productivity and profitability at the end of the day, right? It’s like industrial semiconductors. We had fab plants, and the silicone goes in here, and two weeks later, it comes out on the other end, and nobody touched anything because we had robots, but even back then, we had robots that did the work.
Introduction to Augmett
Gavin Garbutt: So Augmentt is literally N-able 2.0. This is remote monitoring management and security for Microsoft and SaaS applications. So, IT has moved to the cloud. The network is the utility, and the devices are just utility now. Like every, everybody has extra laptops now. In their closet, in their office.
Jeff Loehr: How many do you have Joe on your desk there?
Joe Rojas: I have two right here, just like literally sitting right next to me.
Gavin Garbutt: And people work on this as much as they work on their laptops or computers. So it’s not about the yes, you, you’ve gotta manage and secure the devices for sure, but that’s a utility.
All the data and the rocket fuel of small and medium-sized enterprises are the applications. And if the applications are not operating, then everybody can go home or stay at home or go to the park and have a lovely day because you’re not working. If the applications aren’t working, if your device isn’t working, that’s okay.
Just pick up your phone and work on your phone. Doesn’t matter. But. If the applications aren’t working, and that’s all your data is, and that’s where the security breaches are happening, then…
At Enable, just before I sold it to SolarWinds, we were actually about to rebuild the platform.
We’d done all the specs, and we were going add in SaaS security and SaaS management because, in 13, I believed that was going to be the future. I was probably a little early, but certainly when we started Augmentt, which was right at the beginning of the pandemic in January of 2000, the pandemic for us was good because everybody moved out of the offices, and Yeah.
This is the next journey for managed service providers. It’s managing and securing cloud services slash SaaS applications, and Microsoft is the biggest and most important one of those to the channel. That’s the one they have to figure out first. Because they do a terrible job today managing Microsoft.
It was fine when it was a small business server in the office. ’cause you could lock down the server. Today, you have to actually go in tenant by tenant and configure them. And then you have to log back in and make sure all the policies are continuing to be enforced, and no, none of them do.
It doesn’t matter if you’re a 500-person MSP. They don’t do it.
Joe Rojas: Or a five-person MSP.
Gavin Garbutt: So this is basic RMM for Microsoft and SaaS applications. They should audit, you know, identify, we call audit protect. Detect. And then remediate. So, those are the principles that every MSP should be following.
And we’re providing them with the tools. Use your N-able ConnectWise, Datto, RMM solution, Ninja, or whatever it is for the devices. But then, for the application layer and Microsoft, you need a multi-tenant, remote monitoring and security platform, which is what we bring in.
What is the problem Augmentt is solving
Jeff Loehr: Are you solving the problem of ensuring that these things work and ensuring that the security settings are up to date, ensuring that the data are secure? Where is your niche in there? Or is it all of the above?
Gavin Garbutt: It’s three aspects to it.
One, it’s audit and monitoring and reporting of all application usage.
Jeff Loehr: Whether they’re my applications or not, or is
Gavin Garbutt: It is just any application that the employee touches, whether it’s a desktop or a cloud service. This allows them to audit all application usage across all of the employees and how much they’re using the applications.
Are they approved? Are they shadow IT, or are they secure applications? Are they HIPAA compliant, or whatever vertical you are in, have they been breached in the last 360-odd days? So you can understand what the applications are. Do they have duplicate applications? Do they have unused licenses?
Do they have underutilized licenses? Are they using applications where the employee is taking corporate data and putting in those applications? And when the employee leaves, they leave with the data.
Jeff Loehr: We were just talking with someone else; we’re just talking about how much data actually gets left in all of these systems.
Not only is the employee leaving with them, but they end up sitting in, picking your application. The data are there.
Gavin Garbutt: Waiting to be breached. That’s the kind of the wide, okay, let me understand from a security productivity, cost management perspective, what are all the applications that my employees are using?
Then there’s security policy and posture management on Microsoft, which is being able to audit all the Microsoft tenants in a multi-tenant way. Understand. For all of your policies, whether it’s MFA or passwords or lease privilege access or whatever it happens to be. You can centrally configure, monitor, alert on any changes, and then remediate in the system.
So it’s that whole nest this what we talked about, this whole thing in a multi-tenant way. So you never, again, have to go into a tenant to check to see if MFA is set up because if it’s not, it’ll go to your PSA system, it’ll give you a ticket, and you can go right into Augmentt, and remediate across whatever, 10, 20 customers all in one central dashboard.
Jeff Loehr: I was gonna say what’s brilliant about that as well as the report that’s going to allow you to generate for your strategic business reviews because that’s come up a lot as well. Just the information, the insights you’re able to provide your clients as a result of having these data.
How Augmentt reports data
Gavin Garbutt: So, on the reporting side, it’s twofold. We really spent a lot of time designing this secure product, and we had a lot of security consultants and MSSPs advising us for a long time before we built it. And so, there are multiple components to it. The first one is an audit.
You set up all your tenants like you have a hundred tenants. They’re all set up within 20 minutes. Boom. Done. And now you get a report. You can see, okay, MFA across all of my customers, oh, I need to go and fix all of these people, whatever it happens to be, security policies on whatever.
You do; this audit report takes its instant in the product when it’s all your tenants are set up, and we do it as a freemium. Our partners can go to all their customers, all the prospects, and run this report, this audit report that shows them their security policies, their posture scores, their Microsoft identity score, their MFA scores, and pretty graphs about who’s trying to get in from what countries in the world and who are they coming in against.
Like right down to the individual, what the threats are, and who the threats are against. So this is, we call it the Holy Poop report because you told this to the customer. You say, Mr. Customer, look how bad your environment is. Here’s the trend of issues happening. Here’s all your scores. Like we need to fix this.
And we have a premium security program, Microsoft Security Program. It’ll cost you an extra $10 per month. We will monitor, configure, audit, detect, and protect. Your Microsoft security policies are across the board for you.
Jeff Loehr: That sounds really impressive. How’s the response been? People like it.
Gavin Garbutt: Yeah. We grew last year by 1300%.
Jeff Loehr: Oh, so you’re going after small growth, then?
Joe Rojas: Just a little, yeah. Just a little bit,
Gavin Garbutt: And we’re only at the early stage of adoption. So I believe by the end of this year, beginning of next, we’ll be in the early majority where every MSP will say, I get it.
I have to monitor my customer’s Microsoft security policies, and I have to be able to report on it, to your point. And the system can just automatically spit out monthly reports to show everything you’ve done for them.
Joe Rojas: One of the things that I love about you, Gavin, is that you understand reporting.
I remember when I was using N-able back in the day. And I started in 2002, and I remember how much money I made from those reports. ’cause not only were they well laid out and they had pretty graphs and they had all the stuff, but there was usable, tangible information that I could show the client and go, here’s what we need to fix. And here’s why. Here’s where you’re going strategically, and this is why this is important to what you’re doing.
And so I know that if you’re building a report engine, it’s gonna be kick ass because I’ve had good times with you.
Gavin Garbutt: We have over a hundred technical advisors with whom we do quarterly calls. And so it’s not about us being smart. It’s about being smart enough to listen. And then we’ve got phenomenal product management and development people.
Joe Rojas: I wanna talk about that, right? What do we need to do in terms of a community to get MSPs to do what you just said?
Jeff Loehr: Listen better.
Joe Rojas: Yeah. Because I think that is a missing key ingredient in the MSP community. They’re trying to talk and talk, and they’re not listening, and they’re missing just immense opportunities.
Two things that they’re not doing. One, and this is our mantra over here, right?
Agnostic is where MSPs go to die.
You have to get really niche. The more niche you get, the more money you make. And then once you get really niche, you really have to listen. So what’s your advice on that? Because you’ve built some amazing businesses by doing just that.
You need to really understand your customers.
Joe Rojas: What do you tell these guys?
Gavin Garbutt: It’s understanding your customers better than they understand themselves. Not from a technical perspective, because who cares? Honestly, what kind of laptop do you have, or what kind of server do you have?
Like, who cares? That is the utility. What’s the catalytic converter in your engine? You don’t know. You don’t care?
Joe Rojas: I dunno. And I don’t care.
Gavin Garbutt: What is important, like the rocket fuel of every small and medium-sized business and small and medium-sized enterprise, is their applications, which enable their employees and their customers to be successful and, in turn, the company is successful.
So what does an MSP do if they wanna be a trusted IT advisor? I believe consulting and being the trusted IT advisor is what every MSP should lead with. And that means you have to go in, and you have to have a business conversation, not a technical conversation.
Mr. SMB, so great; you are in the manufacturing business, and you create these widgets. Would you mind telling me a little bit about your company and what are your key aspirations for next year? Are you trying to grow internationally? Are you trying to get more productive with your team members?
Are you trying to win specific types of customers? Please help me understand what you’re trying to do as a business. The person will talk to you for half an hour about what they’re trying to do for their business because that’s what excites them. And they don’t wanna talk initially about security.
They don’t want to talk about technology necessarily. They want to talk about how they’re going to win more business, make their team members more productive, and be the best solution in the world for their customers. And that’s the conversation that MSPs need to have initially, and then bringing that around.
Okay. So you mentioned these four things that you want to do, and do you think you have the right technology stack from an application layer, a security perspective to go out and execute on that, Mr. Customer? I don’t know. And every business owner will say, I don’t know because they don’t.
Do you know what applications are most effective in your business? Do you know what employees are using as applications? Are they all sanctioned? Are they secure? I don’t know. Would you like us to do an audit and look at this for you and provide you with a proper analysis and some recommendations?
That probably makes sense. It starts off with the business conversation, actively listening to the customer about what their goals and objectives are, and then understanding how your recommended security stack and technology stack can help them achieve those goals and objectives.
’cause if it doesn’t align with their business goals and objectives, what are you doing in there? What’s the point? Because they don’t care.
MSPs are nervous about having business conversations.
Jeff Loehr: What’s interesting that I’ve found is that people are nervous about having a business conversation. Everybody wants to fall back into the technology that I’m used to. And there’s a reluctance to have the business conversation. We actually teach people, we give them a format, and these are the questions you have to ask. I think that’s probably an indication that it’s the right way to go.
Just because you have the business conversation now, you really have to think about how the technology is going to help them, right? Not just, here’s the technology, and I’m going to impress you with lots of three-letter acronyms, but here’s the technology that’s really going to help you to grow your business, to do the things that you want to do, and to a certain extent that means that you’re putting your ass on the line a little bit.
Because it’s like you’re actually making claims that you’re going to do something right.
Caltech and Corsica success stories with niching
Gavin Garbutt: I’ll give you two scenarios. The businesses that started in the old days, the early days of managed services, Caltech was a five-person organization in Texas that had a nice little business.
And they wanted to verticalize in financial service companies. They grew it to 180-ish MSP focused on financial services. They had airplanes. They fly and go bonefishing. They take nice family holidays. They have highly successful businesses, and they just sold very recently, and they’re happily retired now.
And another one is a company, Corsica, started with us, and they were also about a four-person MSP. And they grew to over 200. I’m not sure what they are today, but then Dale sold. And again, both of these people understood their customers and their customer’s business, and they sold them business solutions, not technology solutions.
So, they aligned IT with the business goals and objectives. They grew massive businesses. And they sold and retired happily, making huge amounts of money.
Joe Rojas: Like you said, I really understand that vertical. And I like what you said: listen actively and really folks out there. That means you’re taking notes and you’re trying to understand their business problem.
And the problem with being agnostic is that if you are trying to understand everybody’s business problem, you are in deep poop.
Why MSPs should be taking notes when meeting with a client
Gavin Garbutt: And Joe, your point about taking notes. Honestly, take notes, have a notebook, take notes. Because when you take notes, people think you’re taking them seriously.
Jeff Loehr: I’m actually gonna go a little further.
I’m gonna say not only should you take notes so that you give the perception that you’re interested in taking them seriously, but you, if you take them seriously, but you actually take them seriously, you have a lot of value in that too.
Gavin Garbutt: My memory’s not good enough not to take notes
Joe Rojas: I always have my notebook with me, and I’m always taking notes.
Why you want to do that is that you wanna really capture what their issue is so that you can really say it back to them. And if you are not taking notes, all you’re doing is listening to respond. You’re not listening to learn.
’cause what’ll happen is if you’re actually taking notes, you’ll be like, oh, hold on one second. I have a question about this. ’cause you’re trying to understand and you look at your own note, you’re like, I don’t understand that.
What does that mean? Can you tell me a little bit more? And it’s nearly impossible to do that across a multitude of verticals because you just can’t wrap your head around that many different problems. Especially if you’re a small MSP, four or five people.
You wanna be able to get your head around the same problem over and over again so that by the 15th or 20th time that you see that problem, you can start telling them, Oh, and you probably see this.
Oh. And you probably see that. And they’re like, yeah, I got that. You got a camera in my office?!
The riches are in the niches.
Gavin Garbutt: Absolutely, Joe. The people who certainly grow the fastest are the people who have verticalized in their specialization. It doesn’t mean it just has to be one vertical. It could be a couple of verticals. Don’t try to be all things to all people because that just doesn’t work.
And I couldn’t agree with you more that you know your customers better than they know themselves and are trusted advisor IT business advisors.
Advice for MSPs scared to niche
Joe Rojas: Good. Good. So, what do you get for these guys? What can you say to them when they say, but if I do that, and this is the number one pushback that I get, I’m gonna miss out on all these other opportunities, and I’m afraid to scare people away.
Gavin Garbutt: If I was an MSP, I would be focused on cloud services. Yes. I do the utility, being the network and devices, for sure. But we all know routers and switches and servers, the gravy train of profitability for managed services, it’s all going to the cloud.
And you’re not managing that Microsoft small business server anymore. You’re not managing a whole bunch of those services in your colo facility. So all of that cash is going, and that’s why MSPs pivoted to security because they realized they had to be selling something, and security seemed like the next big thing.
Yeah. And my contention to MSPs is that’s great, but Small to medium-sized businesses are spending 25% more on the application layer than they are on the device layer, and device sales were down last quarter by 28%. Cloud services were up by 25%. So it’s a bigger number growing fast versus a smaller number shrinking quickly.
Joe Rojas: Yeah. So I like that because then the thing to do is how do I get my vertical and solve the problem out there in the cloud? And what are the cloud solutions that are out there that are helping my people solve their problem? ’cause Jeff always says that you’re either moving away from something or towards something, and they’re moving away from the infrastructure, moving toward the cloud.
And I actually heard somebody say something the other day, which is that the cloud is almost over. The next thing is gonna be like the AI and all that stuff.
What are you providing there in terms of services? So that’s gonna be like the next frontier. I think we’re probably four or five years out from it, but
Evolution of IT Services
Gavin Garbutt: So if I thought of the evolution of IT, Go back to the eighties, and it was small storefront computer shops.
Then, it became value-added resellers. Then, in the late nineties, it was IT service providers. Then, in the early 2000s came managed services, and everybody started adopting remote monitoring and management and PSA solutions so that they could improve productivity remotely, monitor and manage, and secure their customers’ environment.
Great device level. Now that’s being extended to the application layer so that 2022 COVID happens, everybody goes remote. The world has changed, and the network is now, as we say, the utility and cloud applications are the rocket fuel for companies, and companies want to grow and improve their business.
And yeah, somebody takes care of that security thing for me. But you know what, that’s, again, that’s close to the catalytic converter. Somebody’s gotta take care of it. But I wanna grow my business, and I wanna improve my employee’s productivity ’cause I have to be competitive to attract employees and to go and win new business.
And I need to give the best user experience for my employees and my customers. And that happens all at the application layer.
Segue about Chris Anderson and the end of the Scientific Method
Jeff Loehr: Just a quick little segue. I think it’s interesting. Chris Anderson wrote about 10 or 15 years ago about the end of the scientific method, about the end of understanding.
How things work. And when I was listening to you talk about the progression of things from computer shop to where we are today. What he was saying was big data just enables us to do things even though we don’t understand why they work, what they are, or how they function.
So we spend all this scientific time trying to figure out the why and the how, whereas if we just use big data and just say, just do this, and it’s gonna work out fine. And we might have no idea what it is, right? But what I think of when we’re talking about this, like that evolution, when I hear you talk, I hear a little bit of echoes of that, of this idea of, what, the next iteration may be just.
We don’t even understand how it all works. We don’t even understand where it all is. We just have the models to be able to say, this is what’s next. This is what you need to do in order to actually effectively run your business, which may be a place for us to be.
The next evolution for MSPs
Gavin Garbutt: Jeff, I think eventually it will. The next step to me for managed services is, okay, you’ve secured the network and the devices, that’s great, and you manage ’em for your customers.
Now, you need to start helping your customers manage and secure their cloud services. The first one is Microsoft. Like you, you need to go in and help your customers, onboard employees, offboard employees, set up their passwords, set up MFA, and all of that kind of stuff. All the security policies, posture management, and stuff, as well as the administration of the Microsoft licenses.
Then what’s gonna happen? So, MSPs are starting to do this in droves. They’ll start off with the one application, then they’ll figure out, because they specialize in verticals, what are the key top five applications that dentists need, lawyers need, and doctors need, and they will specialize in those five applications, much like they used to do in the hardware business, right?
Joe Rojas: Yeah. So this is.
Gavin Garbutt: Exactly the same situation for the application layer, Mr. Customer; I will help you onboard your employees, offboard your employees, set up all of their passwords, and MFA management across all your key applications. I will do the full administration and security of those key applications.
Then, we will monitor the report and secure all of the other application usage in your environment. So then they’ll charge per seat, per app to their customers to manage it just like they did before for devices. But now, this will be the new revenue stream for the administration and the securitization of applications.
And then the next phase is exactly what you’re talking about, where AI will step in. And this might be 10 years from now when I’ll be a doctor, and I’ll say hello, computer. What are the key applications I should have? You should have this, and this. Great. Can you please set me up?
For my five employees, yes, please enter the name, sex, age, whatever of these employees, and you’ll enter it in your computer, and poof, all the apps will be set up. All your security policies will be set up. And yes. Now that’s 10 years down the road. So, MSPs make hay while the sun shines because now’s your opportunity to get up early.
So we got a trusted IT business advisor.
Jeff Loehr: So, two things. One, if we think that it’s 10 years down the road, it’s probably more like six months. Just saying. And then the other thing is, one thing that I’ve learned about everything is the need for services is likely not going to go away, but if you just sit back and expect the way that you did it yesterday to determine the way you do it.
Tomorrow. That’s where it’s not going to work, right? There’s going to have to be these transitions that we make. And frankly, we see some of our clients now using AI training, AI on their own data sets to then use the AI to come up with solutions and come up with processes and come up with answers to questions.
But just based on their own information. So anyway I think this is, it is certainly going to be interesting. I think, given the speed of change, it’s gonna be faster than we expect. But on that, Gavin, before we go any further, I wanna just have a quick conversation with you about how people get started with you and whom you work with.
Is it just big MSPs? Is it small MSPs who can work with you? How do they get started? What’s life like in your world?
Who do you work with, Gavin
Gavin Garbutt: So our partners range from 3-person MSPs to 700-person MSPs. My advice to all managed service providers is you need a multi-tenant solution to at least monitor and administer MFA across all of your customers, at the very least.
If that’s all you wanna use this for, fantastic. But then I do believe that you should audit every single customer’s security, and it takes seconds. The reports are automatically generated. You show it to the customer, show them everything that’s wrong, and help them improve their security.
You’re proactively, again, monitoring, configuring, remediating any changes across all their security policies, alerting all that kind of stuff, and then reporting. And then, you can generate monthly reports for them to show them all the great things you’re doing. For any MSP, our price point for entry is 250 bucks a month, which is super cheap.
And you can use your license across customers. You can do unlimited security and Microsoft security audit reports across all customers and all prospects. There is no reason anybody should have weak Microsoft security policies because we let you report on a million companies, if you want, for free.
This is the easiest way to sell premium security services for the MSP, and it’s the easiest way for them because our system has all the built-in processes, rules, and engines. So you can have an administrative level person doing the security administration and management across all of your customers, whereas you used to have a level three or level two engineer.
Again, it’s back to the RMM days. A technician can manage about 150 Microsoft seats using our platform; they can do between 600 and a thousand seats. Wow. Our goal is to get it up to 2,000 seats per tech with automation that’s coming out in the next couple of months.
So this whole idea is about how you have a tech, and you’re charging x number of dollars per seat for your administration of security services. How do you have a junior tech 5-6 times the number of seats they can manage? Because that’s gonna fall to your bottom line and your profitability.
And we wanna get MSPs back up to 30-40%.
You remember being 40% profit.
Joe Rojas: I remember being 40% profit. I do. Then it went to 30, and then it went to 25, and then it went to 20. And then I’m like, I’m out.
Gavin Garbutt: And in SaaS security and SaaS management, this is the new frontier for MSPs.
And the beauty this time is that the customer has already adopted it. The horses out of the barn, and the fact that applications have gone up 700%, the number of applications in the last five years, and it’s predicted to go up 10 times again, so the number of applications, meaning the complexity, Is only going to get harder for companies to manage.
So, this is a really easy opportunity for MSPs to go in, extend traditional network-managed services to cloud-managed services and security services, and make great margins. Our partners are making 90% plus gross profit on the services with us.
Jeff Loehr: So I think that’s brilliant. I love that. It’s an easy way to get started. I think you combine that with the strategic business review that we teach people to do. And then you’ve got something that’s really going to help you up that, up, up the margin, up the price. And I do think, look, it’s,
The reason why margins get squeezed at MSPs
Jeff Loehr: The reason margins get squeezed is because you are commoditizing yourself, right?
There’s nothing different between you and the next guy. And so when there’s nothing different, then it’s impossible to maintain the price. The price goes straight down. But these types of reports focus on the business to get to understand the depth of the business. This is a great way for MSPs to stand apart, support their margins, and create really happy customers.
Because customers are going to love this focus on their business and what they’re doing. So I think it’s great. Gavin, I think we have the links that we need to put in the show notes for people to get started.
And I see you have something to say, so I’m gonna let you say it before we move.
The Discover Module for SaaS auditing and monitoring
Gavin Garbutt: It’s just the other part that I really get excited about is our Discover module, which is that wide SaaS auditing and monitoring. The fun part is you go to the customer and say, Do you know how many applications you’re using?
They say, I don’t know, 20 ish. We’re a 40-person shop. You do the audit and. It shows you’re, okay, here’s the 20 that you thought you had the approved list, and here’s the 80 unapproved applications everybody else is using. And here are the employees that are using that.
Would you like some of these to become approved? Should we be blocking some people from using Dropbox or Google Works or whatever? If you’re a Microsoft shop. You have 25 Salesforce licenses, and only 12 are being used. Do you think you should right-size your licensing? That could save you a bit of money?
You have three different marketing applications that do exactly the same thing. Is that a good spend? And inevitably, it’s from security, productivity, data protection, and compliance. So you talk about IT business conversation. That is an IT business conversation. ’cause you’re helping the customer understand what the employees are doing.
Are they on productive apps? Are you wasting money? And who doesn’t wanna save money in this day and age on your application stack? And have your employees more productive and make sure your corporate data and your customer’s corporate data are being protected. So that’s a way to stand out from the crowd if you do the Discover security audit.
Nobody, no, no other MSP, is probably doing it and showing the customer the business value that you bring to them.
Gavin Garbutt: One thing I didn’t mention, but we also have this thing called the Augmentt Academy, where we have complete sales, marketing, and pricing content assets for the website, for emails, for everything that MSP needs to do to sell these cloud security services.
Jeff Loehr: I love it. I think that’s key, and certainly, that business value is what we preach. And Gavin, we appreciate your insights. It’s great to speak to someone who’s done this a few times, right?
And has that wisdom and that insight to help the rest of us figure out how to make things work. So, thank you for sharing that. I found it super valuable and super interesting, and it’s been a real pleasure to chat with you, Gavin.
Gavin Garbutt: Jeff, Joe, I, it absolutely. My pleasure.
And I’m sorry if I get a little overexcited. I just think this is super fun from the point of view that this is the next evolution of managed security services, and it’s a massive opportunity for MSPs to go in and help their customers and stand out from the competition.
Jeff Loehr: I think that sounds great.
Good. So Gavin, again, thank you very much. I love the excitement, by the way. I think that’s when it’s interesting stuff when we can’t get it out fast enough; that’s when we’re onto something interesting.
Joe, you want to end this?
Joe Rojas: Absolutely. The last thing for all of you out there is to remember that you are loved. See you soon.