Although the peak of the COVID-19 pandemic seems to be behind us, its impact on the way businesses operate is here to stay. With most businesses implementing long-term remote or hybrid work, there is a growing demand for managed services, such as cybersecurity, cloud management, compliance and remote monitoring, that can help streamline IT management for their remote workforce. Having said that, there is a wealth of opportunities for MSPs to tap into in 2022 and beyond.
Our highly anticipated 2022 Global MSP Benchmark Survey results are here, and we have some interesting insights to share. With responses from over 1,200 MSPs, we examined the changing MSP landscape, discovered emerging new patterns and challenges, and how the industry is preparing to capitalize on them.
In the survey, we asked our respondents to describe their average monthly recurring revenue (MRR) over the past three years. The results indicated that, over the last three years, nearly 15% of MSPs experienced MRR growth of over 20% while nearly half of the respondents experienced monthly recurring revenue (MRR) growth of more than 10%.
If our survey respondents are to be viewed as a barometer, now is the ideal time to be an MSP.
In this blog, we’ll examine what these high-performing MSPs do differently to set them apart from their peers.
Among the respondents that recorded more than 20% MRR growth over the past three years, 74% identify as general managed service providers (MSPs) and 13% identify as managed security services providers (MSSPs). This differs slightly from the total respondent pool, in which 67% identify as MSPs and 17% as MSSPs.
Importance of RMM and integration
More than three-fourths of high-performing MSPs consider integration among core business applications (RMM, PSA and IT documentation) critical or very important. Interestingly, 40% of high-performing MSPs cited integration among core business applications as critical, in contrast with less than one-quarter (23%) of all respondents.
This trend is also visible in our next question where we asked the respondents how vital RMM is to their success. While 47% of all respondents said that RMM was critical to their success as an MSP, a whopping 70% of high-performing MSPs said RMM is critical to their success. Having said that, it’s arguable the MSPs that identify the importance of a good RMM solution and invest accordingly are more likely to perform better in terms of growth and profitability.
Acquiring more customers is the topmost challenge all MSPs face, and high-performing MSPs are no exception. Hiring and dealing with advanced and sophisticated security threats are the other two major challenges MSPs consistently face.
Providing cybersecurity advice
With cybersecurity remaining a fundamental concern for MSPs in recent times, we asked our respondents to share some of their cybersecurity practices with us to better gauge how well they understand their customers and how well-prepared they are to address their cybersecurity concerns.
We asked our respondents to share with us the extent to which clients have turned to them for advice on cybersecurity plans and best practices. Nearly 69% of the high-performing MSPs said that they offered advice to all or most of their clients. On the other hand, 60% of all respondents said that they offered advice to all or most of their clients. This data indicates that high-performing MSPs record a higher percentage of their clients turning to them for cybersecurity advice.
When asked to describe their merger and acquisition (M&A) strategy, nearly half of the high-performing MSPs said that they were either investigating selling their MSP or looking to acquire other MSPs within the next three years. This is in contrast to just over one-third of all respondents who said the same. This speaks of higher maturity levels among high-performing MSPs.
The focus of this analysis was to identify what differentiates high-performing MSPs that had more than 20% MRR growth over the past three years from their peers in the industry. The data indicates that high-performing MSPs believe in the power of RMM in driving success and also understand that integration of core MSP applications is crucial for streamlining IT management. Higher-performing MSPs are also more likely to be thinking about M&A from either a buyer or seller perspective.
For more detailed insights into the 2022 Global MSP Benchmark Survey results, download the full report now.