Scaling An MSP From $10 Million to $60 Million w/ Kevin Blake

Welcome to the $10 Million MSP Podcast. This podcast is where I dive into the real stories of MSP leaders who have gone beyond $10 million in revenue, how they built their teams, created scalable systems, and turned their businesses into valuable wealth-building assets. I'm Brian Hoppe, strategic coach to MSPs. I work with MSPs generally in the $5 to $50 million in revenue range. In each episode, I sit down with leaders who have built MSPs beyond $10 million in revenue to unpack the inflection points that truly matter. From the personal stories behind their journeys to the fundamentals like culture, operational maturity, and driving profitability. This isn't another MSP podcast about tools and tech. On the $10 Million MSP Podcast, you'll get behind-the-scenes conversations with leaders who've built thriving MSPs, their biggest wins, their toughest lessons, and the practical takeaways that you can take back and use right now. If you're an MSP owner who knows that growth starts from within, that mindset, leadership, and strategy align to create both wealth and meaning, then this show is for you. New episodes are released every other week.

So let's jump in.

All right.

Well, today I am joined by Kevin Blake, who is the former CEO of TechMD and currently in corporate business development and an executive advisor with Entegris. Kevin, welcome to the show.

Uh, thanks, Brian. Thanks for having me.

Absolutely. Well, I, I always like to just dive right in, um, with a, with a good question. And so, um, so my question for you is, what would you say that most MSP owners fundamentally misunderstand about what it actually takes to grow from $10 million in revenue to $50 million in revenue and beyond?

No, it's, uh, That's an easy one because as going through it, it's hard when you're actually running the business a lot of times with a lot of folks that helped you get to a certain level. But it's all about those key leadership positions and finding folks that have the capacity and the know-how and kind of seen the story to take you through those growth barriers. Running a $10 million business is a lot different than running a $50 or $100 million business. So leadership is key.

Leadership. Okay. So, so, so you would say that finding the right people in the right seats on the leadership level is one of the biggest things that, that would, that enabled you to kind of make that journey?

Yeah, absolutely. I mean, growing, you know, from $1 million to $3 million, $3 million to $5 million, you know, to get to that $10 million mark, which is impressive in the MSP landscape, you know, there's some of that, right? So generally an MSP is started by a great tech And, you know, they have to figure out how to empower the next great tech, right? And generally, they're also head of sales, right? Because they can— nobody knows their business better than them. And bringing in folks underneath them and building those layers of people that, you know, live the culture and that can— it's the only way to grow, right? So, it's no different when you get to $10 million trying to go to $50 million. It's just at different levels of the business, right? It's more of those leadership levels, those middle management levels. Being clear and transparent on who reports to what and what are the KPIs we're all looking for. And so, everybody's on the same page, rolling the same direction. It's a different animal when you have 4, 5, 6, 7 layers from the CEO down, right?

Yeah.

So, I might say something, when we're a 20-person company, I could say something to 20 people and the message is received. We're a 200-person company, I say something, And it's got to go down through, you know, executive leadership layer to a middle management leadership layer to a service manager layer to a frontline worker. A lot of times that translation, you know, you just take it for granted that it should just get there. You have to be very intentional about the communication and messaging in order to make sure everybody in the organization is doing, you know, what's necessary to keep your clients happy and to work towards that vision you've set.

Yeah, absolutely. Yeah, well, it's like a big game of telephone at that point. It gets— and the message can get diluted, right? When it's getting passed along among so many folks. So totally makes sense. And thanks for sharing that because I think that a lot of times people tend to see leadership as kind of like a squishy type of concept. You know, when you say leadership is key, well, it actually really is. And it's not like a, you know, something that's like this, oh, well, you know, it's not really that important. It's this kind of squishy concept that, you know, yeah, I'm a good leader and they just move on from the idea, right? So building that leadership level at the top of the organization is extremely important as you're scaling, for sure.

So, I would say also, you know, leading a frontline worker is different than leading another leadership member, another leader in your organization. You know, you're holding somebody accountable to a different skill, and it's not, you know, it's one that always needs to be fine-tuned and honed in. And it's, you know, folks that have the skill and are— I've had incredible leaders That care, that fit the culture, right? That just haven't kind of been there and know the difference between leading a group of leaders versus leading frontline workers. It's just a little bit different.

It's a very different skill set, right? Absolutely.

Okay.

So for those that aren't familiar with you, TechMD, Integrus, maybe just kind of walk us through a little bit of your background. Where did the business start and where did it ultimately scale to?

Yep. So, I didn't found the business, but I was the second hire, right? One of the partners at a local Computerland that I was working at went off and started ICS, and I joined him shortly after he had left to start it. And back then, it was in 1996, it was just Novell networking, and we did some accounting consulting, SI consulting. So I joined at a really good time, right? Windows was just kind of coming out and being prevalent in the workforce. And I was full of energy, you know, at the ripe age of, I don't know, maybe 19 or 20 years old. And, you know, we, you know, I wanted to grow the business. You know, I really wanted to build something special. You know, I was, you know, I wasn't married at the time, didn't have kids. So I was working, you know, 100 hours a week. And, you know, but my, the founder didn't really want a big business. So it was evident as I was bringing in new customers and then servicing the customers that he just didn't want to invest in more people. And that was not something our visions really, what we wanted to build were different. So I approached him after a series of years of going back and forth and realizing that we wanted different things, and I bought him out. And today he still is operating as a sole proprietor and servicing some of our clients from an accounting standpoint. which is what he likes to do. So the year I bought him out, I think we had maybe 3 employees and we set off to grow. I think that was 2005. We grew organically, a lot on my back, right? So I was still technical, I was still doing a lot of the sales. I was learning how to do accounting and all those things, but I quickly grew to $2.5, $3 million of revenue, but started having things kind of break down in different levels. So it's like I'm dealing with, you know, not technical issues, but, you know, one tech saying to another tech, oh, I don't like this guy. And what do you mean you don't like this guy? We fix computers. And quickly learned that in order to build, to scale the business and to keep growing, I had to figure out how to be a better leader. And right around that time was I joined which was HTG, now Evolve, peer group system. And I joined, you know, I probably had, I don't know, 8 to 10 employees and I'm still in that ecosystem today. I'm now in a group of private equity-backed companies. And that was essential to kind of learn from other folks that were having similar issues as I was, as trying to grow the business. So, you know, so we, So we grew nicely, kind of went through some of those little growth plateaus with the help of my peer group. And I did my first acquisition in 2010. I bought a company about an hour and a half north of us in Syracuse, New York, and naively just thought, you know, the best of what we do, the best of what they do, went in and told their, you know, 15 or 18 staff that, hey, nothing's going to change. It's going to be great. And I spent the next year driving up and down 81 trying to make that work. And Made a lot of mistakes, but I learned, right? I learned a lot. I learned it was a fast way to grow, but I needed to have a playbook. I needed to be more intentional about it. I liked the acquisition side of it. So again, I turned to Arlan, which has been one of my coaches and mentors for the last 15, 18, probably almost 20 years. He came in and did a SWOT analysis and said, you're the problem. You had to do better planning. Yeah. Generally, when there's a problem in the business, you can look in a mirror from the CEO standpoint.

Right.

So, yeah, you have to empower more people. You have to figure out how, you know, you can't be everywhere and everything to everybody. And that's kind of what the state I was at. I think I had about 40 or 50 employees and, you know, really all of them kind of rolled up to me. So, you know, I took the SWOT analysis and, you know, with their help, Went and hired a COO and put a level of leadership layer in intentionally, right? And I made some mistakes there figuring out how to comp that layer and how to be more transparent, how to open books and know how everybody's winning at the same time. And I built out the M&A playbook, right? So that's where, that was the start of it. So when we did our second acquisition, maybe 2 years later, Um, it went a lot better. Uh, you know, not perfect, you know, you still learn from your mistakes. Um, but, um, I did over a series of, uh, you know, 7, 8 years, I did 4 acquisitions, um, on my own, and they were all, you know, $1 to $3 million MSPs in, you know, in about a 2-hour radius of my headquarters here in Endicott, New York. Um, you know, so in 2019, you know, I had done the All the different planning that you all teach you to do, right? So what do you want to grow? Be intentional about what you're trying to grow, right? So come up with your personal wealth target and what does the business have to be worth to achieve your personal wealth target? So I had done that and in 2019, I kind of lifted my head when private equity entered the space. They did their first acquisition, I think it was Wolf Consulting. I was like, what was that about? And hearing about the multiples. And so I kind of did the math of where I was at. I think it was about $12 million of revenue, roughly $2 million of EBITDA. I said, my God, at these multiples, I'm well ahead of my business wealth target. So I also wanted to prove to myself that I could do bigger acquisitions, right? But all my assets were sitting inside ICS. So it wasn't fair to my wife to go out and take on more debt to go do a bigger acquisition. So I again turned to my group of advisors and created, what would a— if I'm going to do a deal, what would a perfect deal look like to sell part of the company to a private equity firm. And I crafted a must-have list and a nice-to-have list and, um, you know, talked to my peer groups and peers that, you know, had, you know, were kind of in the same boat. And, um, you know, so I had this kind of blueprint of what I was looking for. Um, and then I went off and, you know, treated it like a job, just like I treat it when I'm going to look for M&A targets. You know, no different than looking for new clients in your MSP. What's the ideal customer profile, right? So where it's the geography, What's the culture gotta look like? What's the business maturity, right? So do the same thing with— I did treat it the same way I treated a customer acquisition, right? So who's gonna be a buyer of ICS that will check off every one of my must-have lists and maybe tick a few of my nice-to-have lists, right? So must-have list is be a platform, double-digit multiple, certain salary, believe in my M&A strategy. The nice-to-have list might be a country club membership. So stuff like that. So I talked to a lot of different suitors in that year, and ultimately when I met a small private equity firm out of California called Clearlight Partners, I flew out and I met with them and I was very direct. This is what I'm looking for. This is kind of the deal breakers and they checked every box. So when they did, I did the deal in March of 2020, which was an interesting time. I did it March 10th, 2020. We did not get to know at that time that 6 days later we'd have a stay-at-home order for, you know, better part of 2 years. So that was interesting, but it worked, right? So we did the deal. I sold 80% of ICS. I kept 20%, and we did our first larger acquisition. We bought a roughly $1.4 million EBITDA company in New England, and integrated that company in and then did 4 more acquisitions. We did 3 in 1 year and kind of, so we quickly grew up to roughly $65 million range, learned a ton, right? So one thing private equity does as a partner is teaches you how to use debt, right? Historically, debt was bad. I didn't want any debt anywhere, so I would try to cash flow everything. But when you really learn their playbook and how they utilize debt and the returns you can get if you use it properly, it's incredible. Absolutely incredible. So we did from 2020, mid-2020 to June of this year is when we recapped with Integris. We had grown from $12 million of revenue to about $60 million of revenue, $65 million of revenue. And then Rashad Bajwa, who I think has been on your podcast, We were very close. We were in the same peer group for 5 years, a large company group in Evolve. We had talked a lot and we were on similar paths. He did his deal in 2020 as well, but grew a bigger company. They did bigger acquisitions. They had a little bit more aggressive private equity firm. But at the heart of it, we were both trying to build people first, right? A cultural culture-centric MSP, fully integrated. You know, we both believed the same thing, right? In order to unlock the power of your size and your breadth in every area of the company, you had to be fully integrated. And there's a lot of different playbooks out there in a lot of different levels of integration. And the one that both of us chose was the really hard, every— he does everything the same way in every area.

Yeah.

every piece of the company, but it unlocked a lot of value, right? So, when I say hard, it's, you know, you have to take firm lines, right? And it does cause some customer noise, right? And ultimately some churn when you're doing that full integration, you know, but when you get to the other side of it, you know, it's far worth the benefits, right? So, you have an organization that is very powerful, it can do a lot of things, and, you know, the folks underneath you have great career opportunities, right? So when we were, you know, one of my nice to have, must-haves when I originally thought out of this platform, MSB, I was trying to build and have a private equity sponsor invest in was I only wanted to be in the Northeast and I only wanted to be on the road no more than 30 days a year, right? So both were 2 years in, we bought another peer group member of mine, a good friend of mine. It was $3 million, roughly $3 million EBITDA acquisition in California. So I was flying across the country, integrating that company. So you can see how things change a little bit as you get into it. But I also think COVID changed the world, right? It shrunk. And so a lot of that was when you buy companies, everybody has a little bit different culture, right? So you try to do as much due diligence upfront to understand You know, how that organization ticks, you know, what are the important things to keep people still happy and motivated, and then, you know, you cast your vision. So I watched Rashad kind of go through it as he did his 9 acquisitions, and we did our 5 with Clearlight. I did 4 on my own. So when he recapped in December of 2024, At the end of the year, we were talking along the ways and he's like, we make, we gotta come together. We are, we have similar visions. We're fully integrated. I have a big new partner in Omers. It's a pension fund. So it was, we weren't on the market, you know, we had talked, you know, me and Clearlight to hold the business and run a process mid-2026. But this made a lot of sense and, you know, I watched a bunch of my friends that are in this peer group kind of go through the full process like Medicus and Thrive and Integris. And I didn't really want to go through 20 management meetings and ultimately not have full control over where I land. So I was happy that we were able to get the deal done. It was a preemptive offer. We, it was quick, right? So we started talking in end of January, beginning of February, got to LOI in March. And we're closed in June. So, so now we're 800+ employees, uh, national. Um, and, um, I was originally on a stand for 6 months to just help transition the business. Um, but, um, they, uh, I, I got involved in the M&A side of it and, and now I'm kind of heading that up. So, um, I'm having a lot of fun. There's a lot of activity in our space right now, as you probably know. So, yeah, we're roughly a $250 million MSP. You know, you know, organically and inorganically growing. So I kind of am living in the inorganic side of the growth.

Yeah, I love that. I love that, man. So, well, thank you for for sharing all of that because it's I mean that I think that all informs well your your deep level of experience as well as you know as well as what's possible for MSPs out there. You know, I don't I don't think that it's over. I don't think you know I think we're we're going to continue to see a lot of this kind of activity. And so there's definitely places where others can do the same or similar to what you did. So let me ask you, how did you kind of decide on your strategy for growth? I mean, obviously, you were trying to grow organically throughout that whole process, but throughout there, you did a lot of acquisition on your own and then with partners.

Yeah.

private equity. So talk about kind of how you decided to do that and decided that was a great idea for you.

To grow the strategy, to grow organically, you mean? Yeah.

To grow by acquisition, because it seems like that's the majority of the growth that you experienced.

No, I mean, we still achieved year over year, I would say 12 to 15% organic growth. That was harder than the inorganic is easier, right? You can buy EBITDA, right? The hard part is integrating it. We got good at that. But the organic side is actually hard. It's challenging, right? So we had, I don't know, a 25, 30-person go-to-market team. We threw a lot of stuff against the wall in terms of marketing, in terms of events, in terms of SDRs and But you have to have both. I mean, to get the valuations that people are hearing about out there, you're not gonna get it by just buying a bunch of EBITDA and trying to hold onto it, right? You have to be intentional and very strategic about what you do after you buy it, right? So how are you integrating it and track the results, right? So how much of the customers are you maintaining? How much of the customers fit your ICP and even can you be successful with? Right? So, some, one of the early acquisitions I did on my own, you know, I bought a company and, and they were more break-fix/VAR than MSP. I was all MSP, you know, I didn't realize the importance of it. It taught me the importance of ICP, right? So, I thought, oh, we're gonna go in there. That company probably just didn't figure out managed services. So, I'm gonna go take all their clients and flip 'em over to an all-you-can-eat model and it would be great. No, the clients they had didn't want an all-you-can-eat model. They liked being at a brake fix shop. They made that choice and they didn't want it. So, the importance of defining your ICP and spending your marketing dollars to go get the right customer pays so many dividends. When you veer from that, you might land some clients, but it costs so much pain to your people, to your organization. Ultimately, you're kind of swimming uphill. It's hard against the current. So, you know, we had set out, you know, did our, you know, what the other thing private equity does is it did is really, you know, the first thing they did when they invested in us was, hey, we're going to go hire a CFO and it's going to be this caliber CFO and it's going to cost this much. I'm like, we're going to spend $300,000 on a CFO? And I'm like, I think we've been doing pretty good without it. And Like, no, trust us, trust us. And I don't know how I made it before I had that level of expertise, right? So having the data in front of you and being able to know what levers to pull, what's working, what's not working, you can't grow, particularly from $10 million of EBITDA to on up, unless you have incredible business intelligence and clean data. Right. So, and know that you're looking at the right numbers. If you don't have that, I don't know how you get past, you might be able to get to $10 million of EBITDA, but it won't be, you won't get to the next level.

Gotcha. So let's talk about that. So at what, so was it when you were around $12 million, the first private equity, and that's when you brought on the CFO?

Yeah, it was about $2 million, a little over $2 million of EBITDA, maybe $2.2 million of EBITDA. We brought on a CFO and that was new to me. I mean, I had an outsourced CIO, but not a true— or CFO, not a true private equity experienced CFO, right? So these guys aren't figuring out taxes and bank recs. They are integral to every decision-making process in the organization, right? Pricing out deals, building out models, for comp, insurance. I mean, they just know how to take data and put it in a format that's digestible to all the leaders in the organization so you can make good decisions and grow the right way. So yeah, so that was my first, it was like 3 months after we did the deal, we onboarded our first CFO who built out the accounting, finance, business intelligence function inside our organization.

Okay, gotcha. And looking back, would you have, knowing what you know now, would you have made that hire earlier in your process?

You mean before I took on private equity money? Yeah, that's hard to say because I was so focused on getting the EBITDA above $2 million or close to $2 million as possible to spend $300,000+ on a CFO with variable comp. It would've been tough. All right. So, and I didn't know the value of it. So having the partner who's been there and done it and, you know, seen the movie say, no, no, trust us, this'll pay for itself. You know, there's some trust there. I mean, ultimately they own majority of the company, not that they exercised it like that very often, but it would've been difficult for me as the sole, as the main owner to make that call on my own and trust the fact that, hey, I'm gonna go spend— I probably would've tried to cut the corner and found a, you know, comptroller that, you know, could do the modeling stuff or spreadsheet stuff. But, um, yeah, would I have grown faster if I did? Yes. Uh, so, uh, but when you're in that world, uh, and you're in every aspect of the business and, you know, you know, even at I don't know what we're at, maybe 80, 90 employees when I did the deal. I had an executive leadership team that were fantastic, but they all kind of grew up in the business. This was mostly the largest company they ever worked at. And we were trying to take it from $12 to ultimately $65 million in 4 and a half years. Having leaders in the organization that had been there and done it and seen it and made that a lot easier. So what I would've done quicker is brought in leadership members that were better than me in those areas quicker. We would've grown faster if we did. So I was probably too slow to make harder decisions on folks that I cared about a lot, but had You know, it's a little bit over their skis and the size company we had gotten to.

Yeah, gotcha. So, yeah. So, and this is an interesting question that I think probably a lot of MSP owners have, right? Because when you, you know, when you look at businesses that are maybe in the $5 to $10 million range, like you said, there are, it's a lot of homegrown kind of talent, right? And everybody's operating at the highest level that they ever have before. Right.

And so very close-knit group because you work arm in arm every day, all day together.

Yeah. Yeah. And which is great for— it's great for culture. It's great for, you know, the camaraderie of the team and just how well they all tend to work together because it's been like 10 or 15 years. Everybody's been working together or something. So as you think about that, based on what you know now, at what stage do you think it's critical to start Bringing in outside expertise to the leadership team?

Yeah, I think we're talking in terms of EBITDA, right? So $5, $10 million EBITDA. I think that finance function is critical before even the $2 million mark of EBITDA.

Sorry, just to clarify, I was talking about revenue when I said $5 to $10 million.

$10 million of revenue, you have to have pretty much every level at the executive leadership level, I think, needs the experience who's been there and done that in order to be successful. I say that in my own ability as CEO, who I am in the largest company I have ever worked for, right?

Right.

So, I graduated college and started at ICS the Monday after.

Yeah.

You know, but a lot of, you know, being my main job at that point at $10 million of revenue was to catch the vision and really be the glorified cheerleader to keep everybody, you know, but I couldn't be the guy that was actually talking and touching. Like, so the message I was sending out needed to come down through the leaders so that when the frontline workers had questions, they could go back up with their leader and they're getting the same answer of what I was preaching up here. That's different, right? So, you know, you have another layer in there. So at $10 million in revenue, you can have your hands on a lot of things, right? So we were at $12 million in revenue. Like I said, I think we had, you know, roughly 80 employees. I can still touch a lot of them and get, you know, we're in 3 offices, 4 offices, but all within an hour and a half drive. When you start going and spreading out geography and you now have more of a hybrid workforce, that messaging and the leadership layers, right? So I think having people that have been there and done it is essential and you'll grow faster. You're going to make some mistakes. There's signs, you'll see signs, you'll just chalk them up to, oh, this is just unfortunate. But if you had the different leader there, you look back, I look back, if I would've made some of those changes quicker, We would have been farther along in those 4 and a half years.

Yeah. Yeah. That's, that's, I think that's a good point. 'Cause, and I think it's something that a lot of folks miss is, you know, how, and now where we're at in the industry today, there's a lot more experienced people out there than there were even 5 years ago. Right. People who have done more and been in larger organizations and all of that.

Especially the finance area. Right. So when you look at like operations and, uh, you know, VP layers of people that have been there and understand MSP ecosystem, you know, particularly where we're at today, Integris. Um, you know, I think we're one of the top, you know, you know, 5, definitely, probably 2 or 3, um, largest MSPs in the country. Uh, not a lot of folks out there that have been there. So you're hiring out of industry for some of these, uh, roles, um, and hoping they can come up to speed on MSP. MSP is unique. Even private equity, I've now working with 2 different private equity firms, Clearlight and Omers. It's unique. Even the way, you know, how close the industry is between the peer group structures that are out there and how the key vendors, you know, the Kaseyas and the ConnectWises of the world have brought everybody together for their conferences. Everybody knows everybody. I mean, I know personally, I'm close with, you know, all of my competitors' CEOs, CEOs and, you know, a lot of times other leaders because of how intertwined our ecosystem is. Uh, it's pretty special. I mean, when I, when I explain to my private equity firm about our peer group and how, you know, we're in the same room with, you know, the other private equity-backed largest MSPs in the country every quarter face to face, and we share financials and we hold each other accountable, they're like, what? We bid against these guys. We, we're trying to get large customers from these guys. We're trying to buy companies against these guys. We don't, that never comes up. It doesn't. The peer group structure is basically, it's kind of lonely at the top and it's hard to go talk to folks and when you're struggling with decisions like leaders, right? So like having to replace someone that's been with you a long time, that's a hard thing to do. And to be able to go talk to somebody in a similar role with private equity backing that is really trying to grow to get a good return, it's nice to have that support. system.

So, yeah, yeah, absolutely. So, um, so I guess on a slightly different note, where, where do you think that you, um, kind of, I guess, underestimated what, uh, the complexity would be as you were scaling?

As I was scaling?

Does that make sense? Yeah, yeah. So, so like, where did you see complexities show up that you, you did not expect?

Yeah, for sure on the inorganic side, right? So merging cultures is really hard when you do 3 acquisitions at a 6-month time and have 100 new employees come under your umbrella and try to vision cast down through and be able to understand little things that were important to an office in Maryland versus an office in California versus an office in upstate New York versus an office in Massachusetts or That's hard to do, right? So for sure, when you bring in leaders that have been there and done it, they know what to look out for and they know how to ask the right questions and they know how to capture those data points. But that was hard. The other hard part was I didn't realize when I was at $12 million in revenue and took on institutional money, private equity money, that my role, I mean, at least 50% of my job was managing the board and managing your investors, right? So, you know, the way private equity works is they take money from investors and they invest in companies like ours, and they are beholden to them. We're beholden to them. So information and being aligned and understanding the strategies, understanding the gotchas when things don't go right, you know, reporting up fast and talking through it. It's collaborative and it can be helpful. I didn't realize, you know, how much of my time was going to be spent Right there, right? So, for the most of, you know, most of my time was, you know, I, yes, I was the CEO and ultimately cast the vision and, you know, had to manage the executive leadership team to make sure they were going, you know, all swimming in the same direction. But those leaders needed to be able to work on their own because between acquisitions and managing the board, I didn't have much free time.

Right.

And I was working a lot of hours, right? Like a lot harder, different type of working than, you know, Then I was $10 million and below revenue, you're in the weeds in a lot of areas of the business. You just are. You're getting pulled into large customer meetings, you're getting pulled into upset customer meetings, you're getting pulled into sensitive employee issues. When you grow from $10 million to $50 million, that leadership level underneath you needs to be able to handle those stuff without you involved, right? And to be able to handle it in a similar way and keep me, the CEO, informed on the important things so I could report to the board, but not have to actually go down and be working through every step of problem resolution.

Right, right.

I didn't see my role when I did the deal and what it would take to grow from $10, $12 million in revenue to $65 million as being— I figured I'd be more involved in large customers and stuff like that. So, but yeah, but it was, you'll learn a lot, right? So I'm a lifelong learner. I learned so much through that first hold period, you know, made a great network. You know, I have no regrets. And now in my new role, and it's an adjustment not being a CEO, but I will tell you, you know, the other thing is I don't have a huge ego. You can't. I don't know how, if folks have big egos, egos, when you're hiring leaders, If you sense a big ego, it's really hard to scale a company, right? So you got to have team players that are, and you got to make sure they're all swimming towards the same goals. That's why comp structure is so important. Spent a lot of time on that.

Yep.

Because you might bring in a leader that, you know, squirrel their hat and you get them, it might be $100K more annually than another peer on a leadership team. There's a reason for that, right? And having, it's not like you do that and all of a sudden you make everybody equal. So you have to manage through those things and that takes a lot of time and effort and work.

Yeah, 100%. So speaking of, like, as far as your growth, as you grew the company, you know, obviously you have to grow as an individual. You're a lifelong learner.

What do you think were the biggest things that, or the biggest ways that you had to grow personally as you grew the It was investing in things like personality training and understanding how people tick and then delivering that training down through all the different leaders in the organization and the employees, right? So it's the soft skills, right? It's the listening skills. It's the— you think it's the basics and people just inherently understand that, but they don't. So through Evolve, we learned about Make a Difference, which is a personality test. We give that to every employee. Every employee has a dominant personality trait, right? So I'm a lion, as every employee, Beanie Baby on their desk. So they know what personality they are, right? Are they more extroverted, more introverted, right? So how do they tick? And that fosters good communication. between, up and down the org. Those are areas when I was below $10 million that I would say, you know, hire people that get it, right? So, you can't hire everybody that gets it, right? You have to train folks. You have to invest in training and not just technical training, right? The technical training is the easiest part of it. It's the soft skills, it's leadership, it's personality differences, Those are the areas where I did not see the importance when I was smaller, but as you were bigger, they're essential.

Okay, gotcha. And you've mentioned a few times with peer groups and those kind of things. I mean, I can imagine the answer to this question. Where do you think you would have gotten had you not participated in a peer group?

I can't even imagine. I can't even begin to think how people do it without having a peer network. I just don't. So it might not be the Evolves or Gary Pikas of the world, the True Methods or Rob Robbins. It might be folks can get it through a Vistage or a coach, business coach, but I can't even tell you where I think I would be. I wouldn't be where I am today, that's for sure. I leaned on that group and that ecosystem a lot, especially when I hit plateaus, right? So I got stuck at, you know, I can get stuck at certain levels, you know, certain growth levels. You just kind of bang your head against the wall because, you know, everything you know inherently isn't working, right? So you need an outside perspective, sort of somebody to help you kind of get outside of the business and get above it and really understand what is the true issue here. Why aren't we growing from $20 million to $50 million? Is the org chart set up right? Are the comp plans set up right? We originally tried to find homes for a lot of folks and created this regional-based org chart, which just didn't work, right? So, we made kind of people had P&L control over certain regions, And that doesn't foster a team, right? We want to be fully integrated. If someone's really geared to grow one region versus the other, that doesn't work when you have centralized services. So tearing that down, going back to a roles-based org chart, that took me a while to figure that out, that this just wasn't working, and to be able to abandon that and pivot and create the roles-based org chart and roll that out. That was an That was a big turning point for us and it unlocked a lot of growth once we did that, right? It freed up a lot of capacity in the business and people are generally happier. But yeah, it was a hard decision and I used my coaches and my peer group structure to kind of help me make that decision.

Yeah, absolutely. Yeah. And so I'm always talking about the, as I looked back after selling my business, I, the 3 big things for me and for our team Joining a peer group, implementing EOS in the organization or a business operating system.

And he's a coach with an outside facilitator.

What's that?

Implementing EOS with an outside facilitator?

Well, we self-implemented, but we also had a coach, which was kind of, you know, it wasn't an EOS implementer, but, you know, but that, but yeah, the coach being the third one. All of those things together just created an ecosystem for success inside the business that was not there before that. Before that, it was just like, I'm not really sure what to do here. But if you've got people to bounce stuff off of, if you've got a system for running the business, and if you have somebody telling you, you're not just like doing it all on your own, you've got somebody who's holding up a mirror and saying, hey, This is not so good. Well, maybe we should do something different here. That being a coach, all of those things were just catalysts for growth for us. And so it sounds like that was a very similar view.

I should have called that out. EOS, when we rolled that out, I think we were probably $7 or $8 million of revenue. That was a game changer. We were at kind of a plateau where we're at, but when we rolled out EOS, I did try to self- self-facilitate myself for maybe 2 or 3 quarters. The rest of the ELT is like, no, you're too ADD. It's not working. We brought in an outside consultant.

There you go.

And, it was a game changer.

Yeah.

So, we made decisions faster as a team. We talked about the right things. We didn't squirrel. I mean, I don't care if it's EOS or whatever system you implement, having that system that gets the right issues to be discussing out in open and problem solving is going to get you growing faster. No question. That was influential to us.

Yeah. Okay. Gotcha. So I want to get into—

So it's like the get it, why, have capacity exercise. I mean, doing that every quarter and really having each person in the organization that owns each ops and sales and back office, HR, finance, having to go through that exercise, you know, it really highlighted when the same name kept popping up quarter after quarter. We got to do something here.

Yeah, we got to do something about that. Yep. Um, and did you use EOS all the way through to $65 million? Oh yeah. To run the business? Okay. Yeah. Good. And, and, and as I've had conversations, probably at some point beyond—

we did morph it.

$100 million?

Uh, yeah, we got to about $50 million. And, um, it wasn't— we kind of morphed. It still was EOS. We were still using whatever Traction tool is called now, um, and capturing all of our to-dos and, you know, creating our VTO and, you know, tying it back to our, our 1-year forecast. Um, you know, but we, we relaxed some of the rules of the, uh, you know, the good news and all that stuff. But it's— we still use the heart and soul of it was to get to the issues in the right team.

Yeah.

To make sure everything reporting back each quarter, what has been done, what has not been done. We still use that. Yeah.

And some of that stuff does start to break at scale, but you can adapt as you did and change and everything. I want to talk for a minute about the culture because you've mentioned culture a few times. What would you, how would you consider A, the importance of it and B, how you managed to maintain and support the culture that you wanted inside the organization as you scaled.

Yeah, culture is everything, right? So you are nothing without the people that work for you. Our culture was really driven off my personal mission, which was our vision, or to make a difference in every person I come in life, I encounter. Business mission, same thing, right? So how to have a positive impact on our employees, our employees' families, our customers, our communities we serve. Having that and having, you know, people, yeah, you can pay people to come to work and they'll give you the allotted time, but if you want them to go above and beyond and, you know, it's because they're doing it for something greater, right? So because you've created a culture That rewards that. And people want to be a part of something that isn't just making money. So they don't care about making money, which is another one of the real big things why I wanted to take the preemptive offer with Integrus to sell TechMD is because the private equity sponsor is a pension fund, right? So I'm able to go back to my 300 employees and say, hey, we are now backed by OMERS, which is investing frontline workers' money, right? So we're trying to get a better return for hardworking frontline municipal workers in Ontario College. That resonated, right? That resonates across the org, right? So that was important to me. It aligns with the culture that I've always put front and center, right? People first. We don't make decisions based on bottom line, right? So yes, bottom line impacts, you know, Budgeting and planning. But as far as day-to-day decisions, if Brian has a sick kid or an ailing parent and needs to take an extra month off of work, fine, you can go do it, right? So that resonates across the org, right? So I don't know how anybody grows a business without a strong culture. And you see some other platforms that are struggling right now that just, they have gone through so much turnover from the top down. The culture's kind of, people don't know what the culture is or what the vision is. And you start to see employee turnover, which then leads to customer turnover. That's a hard spot to be in.

Yeah, 100%. So yeah, and that's a common message that I hear throughout these kind of conversations with folks who are $50 million plus. It's like, you know, the culture is the lifeblood of the organization and it also takes a different skillset Um, at that level for a CEO to, um, to kind of like perpetuate that culture throughout the organization, right? Than, than it does obviously when you're, you know, $5 or $10 million in revenue. Um, and so, so obviously—

$5 million revenue, you can go down and touch a lot of people. When you're at $50 million revenue, you are trusting that everybody you have working underneath you, um, fostering that culture. Right, is giving those core values, right? So you try to hire and fire and reward on the core values that ultimately, you know, speak to the vision. Um, but it's, it's much harder, right, at that level because you, you just— a CEO can't touch 900 people. It just can't.

Yeah, yeah, yeah, absolutely. And, um, yeah, and, and just the people-first aspect of things, and I hear that a lot, you know, where it's like, you know, you tend to—

people first. Yeah.

Yeah. Well, and you tend to see people that are a little bit stingy with perhaps something like you mentioned, hey, I need a month off to go take care of this life crisis. Uh, well, we can't really do that, you know, that kind of a thing. And, um, and, and I hear that over and over again from, from folks and, you know, in, in your spot and, and beyond. It's like, hey, I'm, you know, it's all about the people. It's all about the people.

Yeah. Which is why egos are bad.

There you go. There you go. I love that.

Yeah. I always say this, especially when I'm hiring leaders, flip it upside down. Your job is to unleash the roadblocks and help enable the person above you to be successful. And you want that person thinking the exact same way. So it's not a, you do this, you do this, you do this. It's a, what do you need? How can I help you? It just goes a lot farther.

Yeah, 100%. I love that. Um, so, so for a minute to put on your, um, you know, speak to the, the guy who's maybe running, um, you know, an $8 or $10 million MSP. Um, they want to, they want to hit the $20 million mark in the next 4 years and, um, you know, and do a private equity exit. Um, what are the things you're telling them that they've got to they've got to get under control or hammered out, or where are these places that they ultimately, they specifically need to focus in order to have the best possible outcome?

Yep. So $8 to $10 million, decent-sized MSP in our space. They have probably done some work on operational maturity. They have probably have a layer of leaders inside the org, right? They probably have a sales team deployed, right? So, and they want to grow from $8 to $10 to $20 plus, right? To get to that, you know, you get about $3 million of EBITDA. You're now, you're, you know, 12 to 15x range multiple, right? So, yeah. Assuming certain things are true, right? So, yeah. ICP, my guess is $8 to $10 million of revenue company probably still has some bad revenue under the hood, and it doesn't wanna make a hard decision because, you know, that customer has been with me for 10 years, right? So, but they won't accept price increases, they won't adopt your standards, they pay late, right? So, you know, that's doing more damage than good. And those are the hard decisions that need to be made in order to grow, right? Because your people see that you're allowing customers like that to stay there, right? They call it bad revenue. You know, defining that ICP and having as much of the revenue sit in those ICPs, whether it's verticalized, whether it's, you know, SMB, right? So if you're a, you know, 20 to 100 user SMB-focused managed service provider, yet you go land a help desk only contract with a, you know, 2,000-person organization, You know, that breaks. Yes, it's revenue, and you might think that's counterintuitive. We said we want to grow. That's the wrong revenue, right? So that's going to consume your resources. Your resources are not going to be happy because the rest of their time is spent supporting 20 to 100 computer users, right? Maybe a company bound by compliance or whatever, a certain vertical.

Yep.

So tightening up the discipline around the ICP, I know it sounds counterintuitive, but when you do that and you spend your sales and marketing dollars on that to go find those customers and bring that revenue in, you'll start to have a flywheel, right? So your sales team will know how to win with those customers. They will be— their time will be not spent chasing those, you know, 2,000-user help desk only type engagements that you might be able to support for a year or two, but ultimately they're going to probably go shop to the lowest person out there. Um, uh, you know, so ICP is one, right? So stay true to the culture. Then I'm assuming the organic, inorganic is part of the growth. I don't know. It would be hard to grow in the next year or 2 organically to double the business, an $8 or $10 million business. You'd have to figure out the inorganic strategy, the M&A strategy, right? So what kind of companies do you want to buy? You want them in your geo, operational maturity, right? So culture, You know, that is key, right? So, I've learned a lot of lessons and it's hard to start, you know, like, you know, your first time was just, you're going to make mistakes. Just as much support you try, you're going to make some mistakes. So, I would, if you're not in a peer group, be in a peer group. Look at every avenue to grow the business, right? So, channel right now, channel is, you know, the Tolarises and the Sanders of the world are out there. People are seeing a lot of success leveraging them, but you have to still stay true to your ICP. So those are some of the things.

Yeah.

Look at margin of your customer and do you have my client, right? So one of the key KPIs we look at when we're looking at buying businesses is What is your all-in C price? Because that tells you a lot about the maturity of a client, right? And if you can go back and start looking at some of their agreements that are in place, looking at the all-in C price and it's coming out to $70 or $80, you're like, what are they doing for that, right? So, and are they doing price increases? So those are some of the key things, right? So staying true and not just taking revenue at all costs. I know it also sounds counterintuitive, but When you stay true, it just starts to— the flywheel starts, right? So everybody in the organization knows how you win. You know what customers to get. When the opportunities arise, you know how to win them and you win them. So on the organic side, those are the keys, right? Investing in marketing. Usually you probably get to $8 to $10 million and not spend a lot of money on marketing, if any at all, right? A lot of roll-type growth.

Mm-hmm.

At that level, to go to the next level, you have to understand marketing. You have to understand where to spend the dollars, right? Is search still the right answer? You have to understand white space mapped across your clients, right? So, you might have 500 clients and 200 of them buy your all-you-can-eat, but then also buy their hardware and all their licensing and their backup. And now you have some AI go-to-market solutions you're starting to sell them, right? But you have another 300 clients. What's your strategy and plan, right? So, you have to spend money to make money. We need to add some resource on those, on the sales side to go capture the rest of the white space and the customers. And that's the lowest hanging fruit. You have a client that's already paying.

Right.

Right. So how do you maximize that? You know, so building off those strategies around cross-sell, upsell, right, or new logo attainment, right, and all the different areas to do that. Is there another product that you don't currently sell today that you can go, you know, learn and bring in-house and sell across? You have a captive audience, right? So at $8 to $10 million, you have a good client base. And understanding that and creating a plan to go get it, right? So you can buy it too. I mean, that's probably the fastest way to get there, but now it's your integration strategy, right? And do you have the right people that can integrate it, right? So if I was $8 to $10 million today and I hadn't done an acquisition, I would go hire somebody and they'd probably be $150,000 to $200,000 resource. That has done it, right? Maybe an ex-CEO, maybe an ex-somebody from the vendor side who understands MSP, uh, that knows if you're, if you're ConnectWise shop, whatever it is, can help, you know, integrate the databases in a way that everybody can start using things the same way. Because that's gonna, that's gonna unlock capacity, right? So you, you won't need, you know, 2 service managers or, you know, whatever. You'll be able to reduce some headcount if you integrate properly.

Yeah, yeah, that's great. That's a, that's a whole great list of stuff. And a lot of it, um, is, that's all pieces of operational maturity, right? Like the TCP, um, the, you know, kind of your strategy for selling into that, um, and, you know, increasing your all-in seat price, all of those different things, um, definitely, uh, go into that. So, uh, thank you for sharing that. I'm sure that'll be very helpful.

I would also say that I didn't talk about the vendor side, but the vendor side, we had a lot of success with, right? So don't treat vendors— don't try to beat them up with the lowest price. Build relationships with them, right? Um, join their boards, uh, understand how they win. They, they, they, they send— they could send a lot of business. They can provide you a lot of MDF funds to pay for your marketing, right? Investing in on the vendor side, that's a piece of that maturity as we talked about. Um, usually $10 million, you don't have somebody dedicated to go work those relationships. When we set some budget aside and we hired someone dedicated to that, it unlocked a ton of us, particularly around the Microsoft stack.

Wow. Yeah, that's great. Okay, so just as we kind of wrap up here, this is a question I always like to ask because, well, it just brings out some different things that we've been talking about. So, What would you say is the biggest mistake that you've made as a leader?

Not making decisions faster, particularly around people, whether it was someone that was a direct report of mine or a direct report of one of my direct reports. And you've probably done it yourself, sit in an EOS meeting and hear the person's name, but also hear the excuse, well, that person's not our largest client. And that person, his brother is an employee there, but that person's a cancer, right? So you're going to end up in the same— one thing I've learned over the years of doing this, you end up in the same spot.

Right.

You do. If that name is popping on your EOS board every quarter, you're better off just peeling the bandaid off and dealing with it right away. So I would like to think that we would've been probably closer to $80 to $100 million of revenue. with the same amount of acquisitions we did if we would've made decisions faster.

Yeah, that's a really good one. And one that I hear commonly, especially around people. And it reminds me of the, you know, Gino Wickman did these 10 Commandments of decision-making or something like that, or solving issues. And one of them is thou shalt Uh, choose short-term pain and suffering, right? So it's like, hey, it's going to end up in the same spot.

So do you want to control the narrative or do you want to let the narrative happen to you?

Yeah, exactly. And so it's like, uh, you know, and then another one is, well, thou shalt live with it, end it, or change it, right? So if you're dealing with that people issue, um, well, you got to live with it, end it, or change it. Those are the only options. And a lot of times we just live with it for way too long and living with it should be absolutely the last resort as we're doing this stuff, right? So making the hard decisions quicker. That's a really good lesson. And thank you for sharing that. So, okay, so as we wrap up, I like to do a quick lightning round. And so the whole thing here is what comes to mind first, short answers. Yeah, first thing that comes to mind. So first one is, what's a belief that you've changed your mind about recently?

A belief I changed my mind about. Not all churn is bad. Employee churn is bad, right? So understanding that because I want to grow a business fast, right? Not every employee wants the same thing I want, right?

Mm-hmm.

So being able to be happy for that person to to leave and go, you might work at a small competitor. That's what makes them happy. Be happy for it, right? So, yeah, not all employee churn is bad.

Good. That's great. Okay. And so what's something that you've been curious about recently?

Oh, AI. I am consuming everything and everything possible around AI. I think it's gonna change our businesses. I think it's gonna change our customers' businesses. And I am all in and wanna, I wanna understand. I don't think, The answers are right in front of us right now. I think there's a lot of noise around it, but it's going to be revolutionary. And I lived through Windows, I lived through internet dial-up to cloud to, I think this one's coming faster than all of them.

Yeah. Well, yep. And its adoption is definitely faster than most anything, right? So, okay. And so what's something you can't live without in your daily routine?

Oh, my workouts.

Workouts. Workouts. Okay. Awesome.

Yeah. I, if I, I'm just, I have such a, I go, I go to the gym at 5:00 AM. I, as you get a little older, I'm 52 now, your metabolism slows down and I just, I feel so much better when I work out in the morning. I got a good group that keeps me accountable at 5:00 AM and the days I am traveling or I miss it, it's just, it's not as good a day.

Yep. There you go. Okay. And what is your go-to way to unwind like in the evenings?

Go-to way at the end of the evening?

Yeah. Your go-to way to unwind.

It's spend time with the family and exercise. We have a lake house, which I'm fortunate to have. And that time there is, it's only an hour and a half from our house, but it's It's 100% stress relieving. And just going for long walks with my wife. That's the number one way I unwind.

I love it. Okay. And then what is a book or idea or a piece of advice that you feel like has shaped you the most?

I would go all the way back to when Arlen Sorensen, who's been my coach, Said you need to get tech dumb if you want to grow this business, right? So I was a good tech, and that is so true, right? So you got to work on the business. So Emyth, you know, the the the the the the good the good technician isn't isn't going to be the the good fifty million dollar business operator. So always be learning, right? I can I consume podcasts and the read books, leverage my network. Where can I be personally growing? Where am I not holding myself accountable in all the different areas of life, right? So yes, location, but family. And I can easily put my head down, work's an addiction, and miss 3 weeks worth of date nights with my wife, right? So having that structure there, just always be learning and And holding, having people hold you accountable on the different aspects of life.

Awesome. I love it. Okay. So, um, Kevin, really, really appreciate you, um, joining me. This is, uh, this has been great and I'm sure is going to be helpful, uh, to a lot of people. Um, where can folks get in touch with you if they, if they wanted to reach out?

kevin.blake@integrisit.com.

Okay. Awesome. And I'd imagine you'd be happy to have a discussion if they want to like sell their MSP to you or a lot of that kind of thing.

I speak at IT Nation a lot. I'm usually at the data cons, and so I'm out there, happy to have conversations, that Go-Giver mentality. That was another influential book, reading that book. That's who I am. That's what wires me. So if I can help anybody, I'm happy to help them.

Oh, awesome. Awesome. Well, Kevin, you've been helpful to me, so I sincerely appreciate it. Thanks so much for joining us on the podcast, and we will definitely talk soon. Great.

Thanks, Brian. Love being on.

Thanks a lot.

Thanks for listening to the $10 Million MSP Podcast. I'd like to encourage you to take just one insight that you heard today and put it into practice because small shifts create big momentum. If you enjoy the episode, make sure to rate and subscribe on your favorite platform so you never miss a conversation. Thanks again for tuning in, and I'll see you in the next episode.