1001 Reasons Not to Be an MSP
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Well I had to say something
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Making the leap from one man MSP to a functional multi-person company is not an organic one. Only in the rarest cases can you just go from working alone to having a team. The cost of bringing on that first employee has to come from somewhere and unless you can bring on new clients that pay for the new staff at the exact same time as the new staff you will have major financial overhead to carry.
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@scottalanmiller said:
Making the leap from one man MSP to a functional multi-person company is not an organic one. Only in the rarest cases can you just go from working alone to having a team. The cost of bringing on that first employee has to come from somewhere and unless you can bring on new clients that pay for the new staff at the exact same time as the new staff you will have major financial overhead to carry.
I know someone in that boat.
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Do I get a co-writer credit for providing the title?
reason #427: The customer is rarely right, but you still have to kiss ass to get their money.
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@scottalanmiller said:
Making the leap from one man MSP to a functional multi-person company is not an organic one. Only in the rarest cases can you just go from working alone to having a team.
Would this not also apply to businesses of other shapes and sizes?
If you want to go from a single restaurant to 2 locations, there is a cost, there is a leap you have to make, a decision which carries risks but it could be an investment that pays off, many times it does not but on the occasions it does pay off, wow.
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@scottalanmiller said:
Making the leap from one man MSP to a functional multi-person company is not an organic one. Only in the rarest cases can you just go from working alone to having a team.
@Breffni-Potter said:
Would this not also apply to businesses of other shapes and sizes?
If you want to go from a single restaurant to 2 locations, there is a cost, there is a leap you have to make, a decision which carries risks but it could be an investment that pays off, many times it does not but on the occasions it does pay off, wow.
It does, but the leap form single to more than one is huge. It maybe less people or tings than opening a second location, but it is a much different animal in other ways.
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@Dashrender said:
@scottalanmiller said:
Making the leap from one man MSP to a functional multi-person company is not an organic one. Only in the rarest cases can you just go from working alone to having a team. The cost of bringing on that first employee has to come from somewhere and unless you can bring on new clients that pay for the new staff at the exact same time as the new staff you will have major financial overhead to carry.
I know someone in that boat.
I've known many over the years.
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@Breffni-Potter said:
@scottalanmiller said:
Making the leap from one man MSP to a functional multi-person company is not an organic one. Only in the rarest cases can you just go from working alone to having a team.
Would this not also apply to businesses of other shapes and sizes?
If you want to go from a single restaurant to 2 locations, there is a cost, there is a leap you have to make, a decision which carries risks but it could be an investment that pays off, many times it does not but on the occasions it does pay off, wow.
I think that people opening restaurants have a very different situation. Sure, opening another location has costs, but the existence of the restaurant, in theory, brings in revenue itself just by being open. Adding staff to an MSP does not do that. You have to have the staff and then figure out how to generate work for them. Just having the extra staff does not itself generate work.
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Because no customer "to be" knows what you do and you have to educate every single one of them before even finding out if they might make a good customer. It is really tough working in an industry where the people who need you most have no idea what you do.
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@scottalanmiller the "free initial site evaluation" saved me a lot of pain - excellent tip for any MSP out there.
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@JaredBusch said:
@scottalanmiller said:
Okay, I'll start: The field is over saturated,with poorly trained people that should not be running a business service.
FTFY
So True..
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@Dashrender said:
@scottalanmiller said:
Making the leap from one man MSP to a functional multi-person company is not an organic one. Only in the rarest cases can you just go from working alone to having a team. The cost of bringing on that first employee has to come from somewhere and unless you can bring on new clients that pay for the new staff at the exact same time as the new staff you will have major financial overhead to carry.
I know someone in that boat.
Don't you be talkin bout me
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You have to agree it's hard though isn't it?
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OMG, it's super hard. I was at the end of the diving board, digging through resume's meeting with folks, and lost a key client to a big box MSP round here, had to climb back down the ladder, eat a piece of humble pie, and figure out how to grow...
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Running an MSP is not for the faint of heart. There a days you don't sleep, oh wait that's months you don't sleep. There are days you don't eat or shower or pee. Work is your life when you are on your own.
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and have an 8 month old
whatever. I'd be bored if I had a normal job -
Accounts receivable runs your life. Customers often don't pay on time or at all. You spend a huge amount of time chasing down deliquent and dead beat clients. You want to cut them loose but they represent a huge amount of your revenue and if you don't have them you don't have enough work. You often get stuck doing work for people who rarely pay, sometimes not for six months or a year, and you can't do work for other clients that may or may not pay because you are trying to service the one that you have - stuck with the bird half in the hand since you have no way to know if the next client is going to pay. You end up losing a fortune of your projected revenue because you never manage to collect it, you have to send it out to collections and give up 90% of it or you have to wait so long on it that it has lost 20% of its value, if you are lucky.
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I'm not an MSP, but I'll add one:
"You can't sell"
I had a guy who left to set up on his own. He was brilliant. Really clever, really experienced and cheap. The kind of guy every SMB would benefit from employing. His business failed very quickly because he couldn't sell himself. He couldn't sell himself to new clients. He only got gigs with people that already knew him, and that wasn't a big enough pool to sustain him.
Ultimately, this is the reason I've never set up my own business. I'd need a partner who could sell, but I've never managed to find the right person at the right time, so it's never happened.
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@scottalanmiller this is not, nor has it ever (for me) been the case. I've had two clients who ended up being super slow to pay. Both were restaurant groups and after the first project went slowly, I halted work until payment was received. They payed on time from then on out.
And I think most collection agencies cost 15-20% around here.
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@Carnival-Boy see I'm in the opposite boat. I need a nerd. I would much rather run the business, snag clients, Bill, collect, etc. but unless someone wants to work for free, gotta hold off.
