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How to Gain Managed Service Clients using Old School Networking with Brian Mayo
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How to Gain Managed Service Clients using Old School Networking with Brian Mayo
In this episode of the Technibble Computer Business Podcast (with transcript below), we take a trip down memory lane as we speak to Brian Mayo (August 2015). Senior Engineer at Dynamic Alliance who is a regular in the Technibble Forums, going by the name YeOldeStoneCat. He shares MSP tips on his own approach and strategy when starting out as a Managed Services Provider. And gives expert advice through experience on how he gets client contracts with recurring revenue through old-school networking.
We also talked about how to approach businesses in your area and get past their gatekeepers.
Podcast: Play in new window | Download (Duration: 58:53 — 54.1MB)
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Timeline of Discussion with Brian Mayo
01:27 – How Brian started his career as a computer technician
04:50 – Where Brian got his skills
07:56 – The beginning of MSP
12:00 – Good old face-to-face marketing
17:52 – Getting client contracts for recurring revenue
23:25 – Software used for MSP
26:35 – Is N-able worth it?
30:43 – Client retention rate
34:55 – Chasing the “Big Fish” Clients
42:30 – Getting clients around town
44:34 – Confidence in making a deal with potential clients
45:57 – Get past the gatekeepers
47:10 – Social circles and how important they are
48:42 – Meet people in Meetup.com
54:52 – Advice to people getting into managed services
If you are not part of the forums, you are definitely missing out. So head over to the Technibble Forums.
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Podcast Transcription
It will amaze you to know how many of your circle of friends and family you can ask. “Hey, do you know anyone that works on such and such company? I love to get in there.” Find out some person’s name or just walk in and start doing it. Hand your card, go in and say “Here’s our services. We are located right down the street. Love the opportunity to take care of your IT services”. It will certainly surprise you how well that works.
Bryce Whitty: Hello, welcome to the Technibble Podcast. Today with me I have Brian Mayo who is well known on the Technibble Forums as “YeOldeStoneCat”. He works for a company called Dynamic Alliance who is based out of Waterford in Connecticut in the United States. They have physical offices with four suites and their primary focus is small to medium businesses.
In this interview, we talk about how:
- Brian gained his skills.
- the business gained not only their clients, their small and medium business clients but also how they gained good clients.
- they got them on to fixed contracts with recurring revenue and what software they use to manage them.
- old school networking helped him to expand his client list.
Hello Brian welcome to the show.
Brian Mayo: Thank you very much, Bryce, happy to be here. Love your site, great resource for the techs.
How Brian Started His Career As A Computer Technician
Bryce Whitty: Thank you very much. Would you better take us back in time, basically how you became a computer technician?
Brian Mayo: Back in time, well as some people gather from my handle online, I’m YeOldeStoneCat. I’ve been around for quite a while doing IT services for close to 20 years professionally. What got me started goes all the way back in time when I got into computer programming back in high school. I remember there were very large Apple tools carried in a briefcase. Black screens, white texts, floppy drives, the two size floppies, load them with cassette, programming with basic.
Opening up the computers and getting under the hood really got me hooked. Tweaking Windows, upgrading Graphics Cards. And as we know with computers and online gaming, computer gaming in general, that’s when things really start taking off in the later Windows 95 days.
Background in Engineering
My background was engineering, mechanical engineering. That frame of mind got me really into how the computers work under the hood there. I didn’t have any formal computer training with my first job. But there was a job opening for the person with the right attitude. Building computers for a small software company that did point of sales, software written in DOS, clicker for DOS and we had to build turnkey networks for higher-end gift shops all over the world.
I learned how to network. Back then it was a coax network BNC. Artisoft LANtastic was the network package that they used. And learning how to network computers of all different types because customers would ship in their crummy computers or purchase new ones. Whichever it was, we had to build it, make it work, and send it back out to them or set it up on-site. I got pretty good at working with the old DOS software, getting that running over Windows networks.
Where Bryan Got His Skills
Bryce Whitty: Was there any formal training with any of this, or was it fairly just learning on the job?
Brian Mayo: Formal training at that particular place, it was a small company, under 12 people. I learned the basics under one person. But then my mind being ever-hungry—was keen to learn more. How could we make this better, how could we make it simpler? Why are they still doing it this way?
Windows 98 was evolving or just coming out. There was Windows 95B and then coming into 98. Windows peer-to-peer networking was starting to come into its own a little bit better, before then it was fairly clunky. It wasn’t very efficient on the networks. So I dove into that and it’s like “Hey guys, you don’t have to be spending money on this Artisoft networking product anymore”. It really works well under Windows NT. 3 and 4 were coming out and they were very stable compared to Windows 95. I excelled at that job pretty well and on the one-year anniversary the boss calls me in. “You know, we love what you’re doing, we love what you did here, I’m going to give you a 20% pay raise”. I’m like “Wow”.
Bryce Whitty: Nice one.
Brian Mayo: I had some bad news for him, about two weeks prior to that. I was with some buddies out at a pub and we ran into someone. Another buddy of mine I know and he heard that I work with DOS software. He’s like “I’m working with this network for a big Holiday Inn and they run this little DOS reservation program. They run this particular networking software that I heard you talking about. Can you give me a hand with this? I’m having a hard time”. I was like, “Sure”. So we did a double overnight shift there. And he’s like, “You really wrapped this up nicely, I’ll talk to my manager, we could use another engineer here”.
He happened to be a manager at a ComputerLand store. They were a big national franchise back then. I went for an interview there and got hired on the spot there. Hence my going back to my former job. I was just talking about when the boss there gave me a 20% pay raise and said we love what you’re doing. I had to give my two weeks notice and to be honest with you. It’s because my mind was always hungry and what I was doing at the point of sale software place was cookie-cutter. Same thing, same software, setting up the same desktop, the same cash drawers blah, blah, blah. It just turned cookie cutter, I became bored very, very quickly.
This other job seemed promising. They started doing big tasks. Big projects. Working on putting in networks for whole school systems. Wide area networks for schools, towns, and big construction companies. I got lured in. Something different all the time. Working on projects for one place for a few weeks or months and then onto another project. Always meeting a whole different group of people doing different things. It was all so different and varied and I loved that. It wasn’t a cookie-cutter and the same thing anymore.
I kind of evolved. I worked under some really good senior engineers back then. They threw me into the deep end of the pool. Not a lot of instruction except where needed. But just the basics where they knew I could figure it out on my own. Configuring the servers, wide area network, exchange server, there was a lot of fun there.
The Beginning of MSP
What really drove me in the direction that I followed—getting to where I am now—was back then small businesses didn’t really have a big computer network presence in their office. There were usually only one or two computers with dial-up modems to get on the internet to check their emails and other basic stuff. On occasions, they’d also have a QuickBooks workstation. There weren’t really small business networks yet. When it came to networks in the business back then, it was still more for the medium to enterprise size.
In my opinion, there were two things that changed that:
Number One
Broadband started coming out where we had DSL and cable hit the streets. Back then I met Philip, the owner of SpeedGuide.net, and his tweaking software for Windows 95 to let it perform well on broadband with faster speeds. I became one of the staff members of that site. Started getting into the very first routers that came out, the earliest Linksys BEFSR41. I worked with some of the first couples of hundred off the assembly line or the very buggy firmware.
Those really changed computers for small businesses. You could take that, build a network behind it, consisting of five, ten, twenty, or more computers. They could then share that broadband connection instead of having multiple modems everywhere. Or even those shotgun modems where they bond a few modems together like the old web ramp products. That’s the first thing that had a big impact on where I was going.
Number Two
The second thing was Microsoft was really polishing small business servers. In the early days, they had Microsoft Back Office—kind of the predecessor to a small business server. But then Small Business Server 2000 came out.
It was so much bang for the bucks so to speak. You got a really powerful server suite to run your business on. You could have a local exchange server, shared points, shared facts in remote access, and that combined with broadband. I just saw where that was going. It’s like, let’s master small business servers. Let’s master routers. And really figure out how to get business networks set up on it and make a great deliverable product. That’s the path that I’ve followed so far.
I’ve really tried to learn that product well, make some great deliverable products out of that, along with that, the management of our company, I guess it could forecast that A, we’re getting some good computer services and gear into businesses, but this is the kind of thing that’s going to need some of the support and let’s get clients on contracts. Fixed amounts per month, the owner of that company back then seemed to have good foresight on recurring revenue. Let’s take this accounting office and their tax offer needs frequent updates. We have to update the tax offer several times a year. And once a month something like that, take care of it. They go through a lot of printer issues, so much printing volume, printer repairs. Let’s figure out some formula to get them on, what we called back then was just fixed, monthly clients.
How many computers do they have? How many servers do you have? What do you think a good price would be per month to support them? We started working on that formula back then. That was before Managed Services or MSP became a buzzword. We did it the old-fashioned way back then. The old dial-up VPN, PPTP, VPN remote end, remote desktop. We used to use VNC a lot back then, but that’s how we started supporting business clients turning into nice recurring revenue, getting the good checks in from each client for several hundred dollars or so, bigger ones.
Back then we didn’t have the $1,000 a month stuff but it was the start and we really kept on that, kept selling that service, and finding that clients liked it. It’s a fixed fee, especially the non-profit’s clients, they like that predictable cost for services. At that time the ComputerLand franchise that I worked for, the management there was quite a bit into going out and partying. Part of that was even chamber events. They’d rub elbows with the chamber after-hours events because it was drinking events for them. But it turned out to be pretty good because a lot of bigwigs in town would go to the chamber events. And that was a good way to shake hands with people, get your name known.
He also buddied up really close with some big gun accountants in the area. And I’ve noticed that with a lot of business clients, it’s usually the finance director or the higher-ups in accounting that will drive the computer purchases. They select the software that the company runs on, and the line of business apps. They also select the accounting packages, the Sage, Mas 90, Quickbooks, all that kind of stuff. The computer purchases and the services for IT are more under their guidance.
At that time, there were really those two avenues where they got a lot of business clients. That was networking, the old school way, through chamber events, and getting to know the key people in the area. And especially the key accountants or some big accountants that did the higher-end accounting for larger companies. Getting to be buddy-buddy with them lets you do a lot of networks for Microsoft Great Plains installs and stuff like that.
It was nice back then—doing the big server projects, installing a small business server, you’d get a good great payday out of those. The server itself at least several grand or five grand. At least that for consulting fees, for installing it. It was nice—we tried to do one big server install a month. Five thousand or seventy-five hundred dollars just for the consulting fee, for setting it up, for migrating the data, for holding their hand on training them on how to use it afterward. That was a good income. We see less and less of those kinds of projects these days because everything is going to cloud. That’s a whole different story right there which we could jump to later. That was the success then, it was they did those social events, business after hours.
Old School Networking
Bryce Whitty: Old school social networking, I guess.
Brian Mayo: Right, right, it wasn’t a lot of local advertising. It was really just getting out and shaking the hands of people. And getting to talk to them and propose your services—getting face to face.
Bryce Whitty: I think there’s a lot we can say about getting face to face. I guess you can tell a lot about a person when you actually do see them face to face. It’s one thing to shoot a letter or email and just say, “Hey, we want to do these services for you”. Actually getting to know your boss for example and seeing that he’s a good guy. And you can sort of read into him that he’s an honest guy. That means a lot more I reckon.
Brian Mayo: Yeah, I still prefer that. You see a lot of guerrilla marketing advertising techniques these days. Blasting on Facebook, shooting letters out, or some of the post office specials. A lot of those, you know, just end up being thrown out nearly right away. I still enjoy just walking in and just getting the chance to meet someone and say hi and talk to them. Once you’re 30 seconds into that, confidence levels start to go way up. I’m the type of guy that likes to talk to people or meet them and let them see who I am. And once you see and talk to someone, it can feel more relaxed. And so your chances of success go way, way up.
I still prefer the old school way of getting referrals which can lead to some other networking stuff that I did in more recent years as BNI networks worked great for me. My colleague did it for several years longer than I did. But we got some great, great business out of it. It starts to help spread your business name around town or the people that count. If you’re going after businesses, you want people to know your name. You’ve got to get it out there. Through word of mouth, referrals—those are some of the best things, I think.
Bryce Whitty: Did you ever do any alternative forms of marketing? Not alternative, more traditional, say newspapers, that sort of stuff.
Brian Mayo: Yes we have. Years ago we used to do the Yellow Page ad. And of course when a call came in from someone we didn’t recognize, we always asked:
“How did you hear of us?” “What made you call us?”
Everyone that comes in we’ll ask that if we don’t know where they came from. And to be honest – those Yellow Pages ads – I think I can count one client we got in the past five years. We stopped that altogether two years ago. We did a few radio blasts every now and then. But I don’t believe we ever got a client calling us because of that. I don’t dismiss it entirely though because those radio blasts can still get your business name out there. But I think it just takes a long, long time of doing little things like that over and over.
Another one that comes to mind is little league ball fields in town. They do a lot of asking businesses to advertise on their fences there. You put up your four-foot by six-foot sign on their fence for $400 bucks for the season. You’re helping out a community and you’re getting your name out there. You know how many people drive up to that fence, parking their cars to watch their kids play little league? It gets your name out there. We may not get a single client from that, but it’s helping to get it out there. Which I think ultimately leads to more clients calling us down the road.
Getting Client Contracts for Recurring Revenue
Bryce Whitty: You mentioned earlier that you guys do what you can to get these clients on fixed contracts and recurring revenue. Can you tell us a little bit about how you go about that?
Brian Mayo: The first thing is the security services is the big draw or the big push that I do. Managing the computers, keeping the updates going on as far as Microsoft updates. I’ve been beating the drum for years over the web players being a big vulnerability. As for getting today’s malware threats, it’s not so many viruses like we had years ago spread all over Outlook. It’s mostly web-based threats now and pushing the management of the computers as far as maintaining the Microsoft updates and those third-party updates is a big one.
It’s so easy to do. It sounds like you’re on an ambulance-chasing lawyer or something. But after a potential client has a big loss from that “Let us get you on the server sys”, it will really help prevent this from happening again. It cuts down your exposure so much because they’ll see how much they can lose from getting hit.
It’s not so much just the loss of a computer for half a day, although repairable for that. What else happened during that, what about the employee that sat down with the computer. In a lot of places, if the employee doesn’t have access to their line of business software, that’s a huge productivity hit for them. It’s not like 15 years ago where they could have the employee go shuffle papers in the file cabinets and still get work done.
If they can’t stare at their screen for their insurance software, applied systems, or their healthcare software like Suncoast or whatever, they can’t get access to that. They’re really knocked out for a while and the threats of today’s malware CryptoLocker all those variants out there can really hurt them. A lot of times it’s great when they adopted early, all-you-can-eat plans, or manage services they adopted early. And that’s a great one for you.
Over time you can also show them the costs over the past year. When you’re doing basically break-fix costs, those costs, when you look over the year history or so, it’s going to spike and dive and spike and dive, but you try to get an average in there. A lot of times it will come out fairly close to a wash where it’s an easy sell saying, “Look, let’s just make this fixed here“. You have fixed monthly costs. You know what your bills going to be. And you also know what your costs are going to be for the whole year for managing your IT services. Let’s take care of that for you, and the backups also.
I’m sure a lot of listeners here will know that if you leave the backups up to the end-users—I don’t know—greater than 50% of the time it just doesn’t happen. I can’t think of how many times in the past—something’s happened, then I’ve had to go and restore from the old clunky tape backup. And “Oh boy, this tape had been in there since last Thanksgiving! And guess what? It’s not even readable here. Who’s changed it? Who’s run that cleaning tape? Guess what guys? I can’t restore this. It hasn’t been functioning for months”. I’ve seen some really bad moments there.
Someone even lost their QuickBooks for like 13 months, they had to roll back months. I still remember the tears on her face, she crumbled to the floor right there. I mean telling them that you can manage that, you watch it every day, you get the reports every day. If something stops working on the backup, you address it. You take care of it and it’s always working for them. You can share those backup logs with them. So if they care about checking that email that hits their inbox each day, they can say that it’s working. If it’s not working, we’re going to be on top of it, and we take care of it.
A motto that my colleague came up with, “Let us take the worry out of your IT.” Think about that for a minute, let us take the worry out of your IT. It’s we manage it for you, we keep it running smoothly. Managed services can really just help a client’s systems run smoothly. And they get the full productivity out of their employee sitting in front of the computer from 9 to 5 every day.
Managed plans also allow those little guilt-free calls to us, “Hey, I’m having a problem with this”. A lot of times a client is going to be hesitant to call if they’re just on a break-fix it. They are going to call and be scared of that $100 bill or so just for a 15-minute phone call.
Going on a managed plan, unless it makes those little guilt-free quick phone calls for quick questions because we’re there for them. We’re going to make sure it’s running fine and we’re happy to answer their questions. They are in a top priority queue. They can call us and get instant support, so it also guarantees them a nice speedy response. There is SLA there, call queues, get to your problem right away or answer the phone right away, or you have access to my cellphone. Those are all perks that they can get from there.
Bryce Whitty: With most of these contracts that you have, was it mostly after the fact that you solved them? Or were there some even before the fact, before they had a major failure, for example?
Brian Mayo: I’d say quite a bit of them were before. I can’t say 50%, there’s a big difference there. Perhaps nearly half, or they’ve just been with us for a little while and we said: “Look, some months are little bills, and some months you have big bills. Here is the average. Let’s just agree on going with a fixed flat rate each month. And we’ll take care of it for you”.
Other types of clients like accounting, a lot of healthcare agencies, need frequent software updates. So they kind of need that MSP proactive plan in place. And that’s going to be what gets us up at 5:00 in the morning. So that we can roll in those EMR updates that they need almost weekly. Or even a couple of times a month for some of the tax accounting software. If you want us to do that for you, we’re going to push the MSP. Because I need a reason in my paycheck to get up at 5:00 in the morning to work on your servers.
We find it just very easy with non-profits. They especially love to have those fixed monthly support fees there. Super easy to get on board with those plans. They have the board of directors vote on that budget and they propose that and it keeps their accountants very happy. They don’t like surprises, they don’t like big varying bills. Non-profits were a big success story for us, we have quite a few clients that are non-profits and it works out very well for both sides.
Software Used for MSP
Bryce Whitty: What sort of technology are you using to babysit all of these customers? What software are you using?
Brian Mayo: We got tired of doing it the old-school by-hands method about six years ago when we started looking for some RMM products. Back then, as I’d mentioned, we used to do it the old-fashioned way—VPN to their router. Once inside their network, we’d run VNC or remote desktop client and do everything by hand manually. It was pretty tedious, so off we went on a search of RMM tools. We took a look at a lot of the big players there, I could say at GFI, N-Able.
There were a couple of others there. At that time we liked N-Able the best. They were very pricey upfront. They still are considered, they are like the Cadillac of RMM tools. Certainly a steep buy-in point, a big price to jump in with, but we were pretty lucky. We had quite a few managed clients already because we had been doing it the old-fashioned way for so long. It was an easy transition for us.
We coughed up I think almost $4,000 just to purchase it initially—to purchase the licensing and on board with them. We already had that easily coming in each month with our regular clients. So we could transition that monthly income right over to this already. Hence we benefited from it because it made it so much easier for us. It relaxed our time and it freed up a lot of time for us. If we were to do that as a small startup or a one-man show right now, that’s where I see different RMM tools like GFI be a little more likable for the smaller startups or the one-man shows because it’s more of a true pay-as-you-go. You can onboard yourself with a couple of individual clients. There’s no initial big buy-in.
The RMM tools do make it so much easier—the automation and the reporting. Ans also the alerts you get if a problem is happening, the ease of remote access, and a centralized portal. You have access to get to those tools from anywhere you’re at with just a web browser. My laptop right here on my couch at home or my desktop upstairs, or from out of the office – I could be anywhere and just be able to, within minutes, get to any client of mine. Those tools definitely make it a lot better. With the additional services that come with those tools, you can gain much more profit from it, usually.
We used to do antivirus, years ago we were big ESET resellers before we went on board with N-Able. Through the traditional resell models, it’s starting off at 15% margin, 20% margin. Once you get loads of sales up you can step up in your tiers and you get up to 30%. When you go with these RMM tools you’re able to take their antivirus products and mark them up 300%. And still, be just at those straight-up competitors for ESET, so you’re making quite a bit more on those tools also.
Is N-Able Worth It?
Bryce Whitty: Did you have enough clients initially to sort of make N-Able worth it, or did you slightly grow up to the point where N-Able was worth it?
Brian Mayo: We pretty much washed, even though I want to say when we first onboarded, cutting that check for, I think back then just initially was 200 seeds or so was, I don’t know, almost $4,000. By the time we got the hardware anchors, we host the server in our own server room. It was a wash but what I was saying before is that freed up so much time of ours because those existing clients that we had, even though back then, there wasn’t a lot of MSP clients, doing them by hand the old-fashioned way was very, very time consuming for us.
Once we came on board with the RMM tool there, N-Able, it freed up a lot of time because we could automate that. It allowed us to make that hurdle fairly painlessly. It was about a wash-off back then. That freed up so much time so we could start going on a campaign and getting more and more clients and start building that up.
Bryce Whitty: I think a lot of people would look at such a large figure like $4,000 and sort of, I’ve lost $4,000 or I’m $4,000 out of pocket. I guess what your saying is they need to understand that it’s not that you’ve sort of lost $4,000, you’ve gained hours to get more clients and sort of make it all more exponential.
Brian Mayo: That’s right. I mean, you don’t have to hop from computer to computer remotely to manually go update their flash and their java. And you don’t have to spend as much time managing the old clunky dubby assassinators for the console to push out updates over their network. That thing you would wrestle with, wresting with dubious access all the time is pretty frustrating, and just visiting each workstation remotely.
Say you have 15 business clients and each one of them has from 10 to 30 computers, just add all those up. You get to visit those individually, that’s a lot of time. I’m not saying physically visit them, but remotely visit them, remote desktop, telling them you are being seen by them, run those Windows updates, run the web player update, little tune-ups here, check if there are any viruses, it’s very time-consuming.
You go to these tools that do it, the security patch manager for N-Able. You have the global profiles that you apply to your clients and you just push that out. One click here and it’s going out to 3,000 individual work stations. Do the math there, you’re saving yourself a lot of time. What I was saying also with the other a la carte services that you could have in there such as the antivirus, as your client’s third-party antivirus, or whatever they were running, as those site licenses run out we started rolling them over to N-Able’s bundled antivirus.
We started making a lot more money that way because instead of just making a 20% margin on it, you’re making a 300% margin on it. Look at the revenue that it starts bringing in for you when it comes to those other services such as the anti-virus being a big one. Patch Manager is also another one that we’re rolling out. You charge for that. You’re charging your clients for that, and it’s a great revenue.
We looked at our reports for last year, and just the MSP clients, the income from that was fantastic. Just taking a quick look here. Just over the MSP stuff alone for our part was about 40% of our gross income for the year which was very good. We have a little over $3,000 on our N-Able system right now, and it cost us about 26,000 last year because of all the licensing we’re having. It’s gone up quite a bit since that initial 4,000, but we’ve put a lot onto it. If it brought us in over 400k or so, it’s a nice investment there.
Client Retention Rate
Bryce Whitty: Do you find you have any problem with retention like holding onto those 3,000 customers?
Brian Mayo: No, and that’s always a worry. I have to say our retention rate’s pretty good. My colleague and I, both have developed good relationships with our clients. Our top revenue clients still happen to be some of our oldest clients that we’ve had for over 10, 15 years. The retention rate’s good, we do have some competition in our area, definitely. Two days ago I got a great email that I’m taking an all-you-can-eat client from a competitor going there next week. I’ll happily take it.
Bryce Whitty: They approached you, you didn’t approach them?
Brian Mayo: Oddly enough, this one goes way back. Two of the managers there, I used to be huge into online gaming going back to the early part of the interview, and going back into the Windows 95 days again, or 98 days I guess, when this happened. I built a public game server for a clan that used to be big into a game called Unreal Tournament. That was a big, big game back then, online first-person shooter. We used to have a lot of land parties and our clan got very big with competitions, global competitions. The server that I built made it to number 16 in the world, the Unreal Tournaments NG stats.
Some of the guys that managed the clan happened to work at this production company, a valve production company. I got a call from them last fall, “Hey, we’re working at this place and I’m up to a manager now, and we have a big network of cad workstations and email servers. Our current IT guys are kind of blowing us off, we don’t feel important to them. We’re thinking of not renewing our contract next spring. Why don’t you come by, make a visit, shake some hands with management here and introduce yourself? I’ll see what I can do to get you in”.
Needless to say, fast-forward springtime comes and it’s time for them to not renew their contract with their current IT guys. That one there, I got lucky. It was from people I knew 25 years ago from the online gaming days. Gaming can pay off professionally.
Bryce Whitty: I guess it comes back to old school networking again.
Brian Mayo: Yeah, it did there, it did. Another, this gets me to thinking though, another good source of leads for us is to get cozy with website design people, and that being local ones. I know a lot of IT places that cross over and do website design. We don’t. We partnered with local website people and it’s turned out to work out very well for us. We’ve got some great leads from them. Likewise, of course, we hand them, when our clients need websites, “Here you go“. We start handing out their cards, and you get referrals in return there.
Bryce Whitty: You’re babysitting their web servers.
Brian Mayo: We can. We have our wholesale account with Rackspace. If our clients need websites, we’re happy to hang them there, provide our service for them. They have their own website people, great, we can hang it for them. Some website people like to make their own bus fare on reselling web hosting services.
Great, let them do that. I don’t want to step in their way there. Revenue from hosting a website really isn’t that much. I’m not after the $10 a month profit or something.
We really try to stick to much larger things, disaster recovery, backup services being another one that we’re really going after the high-end ones. I don’t want to focus too much on $15 a month packages. I really want to see something that’s over $150 a month. That’s with 100% mark-up.
Quite a few packages with the higher-end disaster recovery can be several hundred dollars a month, and it’s a great product with fantastic ease of mind for the IT provider. It’s a good money-maker and it’s turned out to be one of our biggest, it has been our biggest MSP service that makes money.
Chasing the “Big Fish” Clients
Bryce Whitty: Do you usually go for the big fish, or do you ever take on slightly smaller stuff, or is it always just going for the big fish?
Brian Mayo: The sweet spot for us is a company that got between 10 to 100 employees translating into 10 to 100 computers. Below that, it’s usually going to be a workgroup, not a server, perhaps two or three computers, four or five computers. We’ll take those but it doesn’t end up being a big, big money-makers.
On the other end of the spectrum, once you get to a company that is over 100 employees inside, chances are they are going to have their own internal IT staff and that greatly reduces the need for us. That’s our sweet spot there from 10 to 100. I have to say our top ten clients are between 60 to 100.
Those are great. I love a server room that I can build where you have a full-size cabinet and you have four, five, six, eight servers in there. Another whole stack for switches. I love those great set-ups, wide area networks. Those are great, I love those types of big projects like that.
Bryce Whitty: You mentioned the web developers before and you are cozy with them. How did you actually go about getting cozy with the web developers?
Brian Mayo: Let’s see. Well, when we started out we were renting a small suite in a five-storey building in the downtown area. There happened to be one down the hall from us. That was number one, number two was another one that was just starting up in the area, and he happened to be a developer. He happened to be the guy taking care of a website for a non-profit client of mine. I met him because he wanted to have a little hidden link in his website for letting the staff remote in through small business servers from a web portal. We had met and, I don’t know, the idea clicked.
It’s like he was asking me, “Hey, you know other clients that need their websites overhauled, please give them my card”, and I’m like, “Likewise, you have some clients who need their servers or network worked on, here you go, give them my card”.
That was quite a while ago.
That particular guy, he ended up, you probably heard of him, but he’s gone national and he’s gotten huge into the SEO model and everything, but started it out as we fed each other a lot of business. It was a very, very good relationship. I’ve pursued that with several other website developers and it’s worked pretty well. It’s a great partnership. Since we don’t want to touch websites, we don’t want to design websites, I like to stay on the inside of the firewall from the street in. It just works out well. I think it’s a great strategic partnership.
Another one that’s worked out for us is smaller more specialized ISPs, Internet Service Providers. Not your local cable company, not your local phone company but the small ones that are in the area that caters to businesses only, and they do really specialized set up. It cannot be point-to-point wireless and kinds of stuff like that. They handle the bandwidth on the outside we refer them bandwidth clients and web posting and email clients like that and they refer us to do the inside of the networks. That’s another one that’s worked out very well.
Bryce Whitty: How do you approach them to sort of team-up?
Brian Mayo: That one you have to get lucky and know someone. I’m trying to think of the two places that one story goes back to gaming, anyone remembers a game called Quake 2?
Bryce Whitty: I think most people would. I think if you were born in the 80s everyone, there is one probably from the 90s.
Brian Mayo: I got lucky and met someone who ended up being one of the owners of a small ISP that ran a server for that out of there, data center there. I ended up meeting him and we took off well from there and the other one was going back to that ComputerLand company that I worked for years ago. A guy did all the data wiring jobs for their commercial projects. He got into handling the firewall parts and then he got into reselling bandwidths from ISPs and he developed quite a data center there.
He was kind of a self-taught, self-built it from scratch small ISP that stayed in the area for near 20 years so that one is a tough one to go out and find. How do you find the small ISPs or the small business-oriented service providers that provide the bandwidth that’s a tough one to go out and find but I would say keep your ears open.
If you are in this industry every now and then you have got to come across a strange internet connection that’s not the local phone company or the local cable company. You’ll see those little names here and there, the small ISPs, and just go after them. Find out who’s running it, make some calls, send some emails. You can usually develop a little partnership with them that once you work with them, you have got to shake hands you meet them face to face, that’s the hardest part there. Once you have met them face to face that’s when you can develop the relationship and build on it, it’s easy after that I think.
Bryce Whitty: Because he really just seems to be social, getting to know people and gaining trust and then referrals off that and so on.
Brian Mayo: Exactly. Exactly, I still like the old school way of doing things that way, meeting people shaking their hands talking to them. You get so much more out of that meeting rather than some postcard that comes in the mail advertising someone’s services and you end up glancing at it only to take better aim at throwing it in the recycle can.
Bryce Whitty: The media talks about all sorts of buzzwords, “You should have a Twitter account, you should have a Facebook page, you should have this” but most people I’m seeing actually don’t actually see a huge conversion with that sort of stuff. I know personally with my own business it wasn’t so much about my skills, it was actually the fact they liked me that, and then they referred me from thereon. It was the social side, it wasn’t any of them so much, the marketing that I did.
Brian Mayo: Exactly, every time we’re talking with a new website developed for us and we’re looking at doing a partnership with them. Again that’s a partnership thing. They’ve been around for a while, had some big clients and we are ready for like phase two of their proposal for our website.
Our website you don’t want to look at it. It was designed so long ago, it’s so stale so dated looking but we don’t get business from the websites, we get business from word of mouth.
We prefer that method.
None the less we are undergoing an overhaul and they keep saying, “What do you guys do for your social media?” And the prior person we had for about six months, we were going to have her do some SEO boosting for us. She’s like, “Get active on your blogging and get active on your Facebook” and I was doing that for a while—the company’s Facebook site and trying to do posts. Then you look at the results from it. And it ends up being that the people who like your page are your existing clients. So you make a post and they like it.
Getting Clients Around Town
“Okay, now how am I getting it out there to new clients?” I don’t think we’ve gotten a single one from pimping our Facebook page tough on us. We still prefer to go back to the old fashion way of doing it talk, meet people. Drive yourself into their office I mean when you are driving around town look at a business, pay attention. Look to your left and your right as you are driving around town and you see businesses, “Ghee I would love to have them as clients that look pretty cool. That’s a growing company. I wonder what they have for servers, I wonder what they are doing for backup”.
Stop wondering and go in there and find out. Chances are you know someone that knows someone that works there or knows someone. You’ll be amazed at how your circle of friends and family who you can ask, “Hey do you know anyone that works at such and such a company? I’d love to get in there”.
Find out some person’s name or just walk in and start doing it. Paying your card goes in and your little bit of collateral you have, “Here’s our services we are located right down the street and I’d love the opportunity to take care of your IT services.” You’ll be surprised how well that works. Making that first step to do a personal appearance really, really helps. Sometimes we’ve done campaigns where we’ll pick a particular road that has a lot of businesses on it which and we just go hummer it. Go meet people, go door to door.
Bryce Whitty: You actually walk in and just say, “Hey this is what we do and who we are.”
Brian Mayo: Yeah, when our offices moved just six years ago, we moved out of the downtown area to the suites that we are in right now. That’s what I did when we first got there and we picked up a few from that. Just up and down the street walked in, here’s a commercial real estate company, here’s a small law firm, there was a cleaning company, they since wrapped up and closed but, knocked on their door walked in shake someone’s hand.
I know a lot of time you are just stuck with the so-called gatekeeper there and you may not think it goes far but we picked up a client from that and what did it take from my time one day? An hour and a half driving down the street stopping in a few parking lots and walking in a few doors, it just worked and I love doing that. Just when you drive around town pay attention, if you see a business start thinking about what they might have for IT there. If you find yourself saying, “Gee I’d love to have them for a client” go after it.
Confidence in Making a Deal With Potential Clients
Bryce Whitty: How did you gain the confidence to sort of just walk in and say, “Hey this is who I am and this is what we do?”
Brian Mayo: That’s a big one there, I don’t know old age. If I’d thought of doing that like 25 years ago, I’d be on the shy side of things but I don’t know just life experiences or when you’re trying to … I think when it shapes your own paycheck, it’s when you make a bigger hurdle to go do it. Yeah, 25 years ago I wouldn’t have found myself doing that at all. Who’s the salesperson? You can’t have a sales rep and let them go do it. But I think just once you start caring about building up your own client list and you start setting your monthly and your yearly goals, your annual goals, you’re looking at doing another 15 percent this year and come September you’re not quite there yet.
That starts driving you to do it plus I’ve got to say probably it’s something else with getting towards old age. I guess you don’t worry about those little things I mean so what. What’s the worst thing that’s going to happen? They’re going to say, “No thanks we’re all set” you walk out. It shouldn’t be any embarrassment. You can’t expect a higher rate of return on that approach but in my opinion, it’s a much higher chance of success than sending out 5,000 snail mail pamphlets.
Bryce Whitty: You only need to get one as well and they stick with you for five years and they’re paying X amount per month. It was totally worth it pounding the pavement for five hours or whatever it was.
Brian Mayo: Exactly.
Get Past the Gatekeepers
Bryce Whitty: How do you get past the gatekeepers? You mentioned you may run into some receptionists and how do you did you get past them or how did you try to sell to them or simply wouldn’t let you past or you organized something else?
Brian Mayo: You’re not going to get past them but asking who knows someone who works there and I actually found BNI being really handy for that. I don’t know if you … I’m sure you’ve heard of BNI they are the business networking groups. I mean you have an audience of depending on the size of your group from 20 to 30 business people who are in your region. You have their ears and you have to think of their circle of friends and colleagues.
Once a week, I would stand up as part of my quick speech there. Once a week, I would name some company that I wanted to get. “Such and such law firm, such and such insurance company, such and such nursing home, such and such accounting firm”. Whatever.
Bryce Whitty: Yes, yes.
Brian Mayo: Each week you go to those meetings with a name of a business that you would like to get for a client and stand up and ask that and chances are, it was great and 75 percent of the time when those referral sheets came in. Someone in my BNI meeting knew someone who worked there or had a neighbor that worked there. I’d have some sort of number to call.
Social Circles and How Important They Are
Bryce Whitty: The social circles, it’s amazing like you see with things like Facebook that someone your friend is actually really close friends with another friend who and those two circles of you don’t know each other at all and it’s amazing especially in smaller areas but even in big cities, it’s amazing.
Brian Mayo: Yeah, I mean just asking if, “I’d love to get a warm lead for such and such company” and you’ll be amazed at the response you get from that. Once you have that depending on the person that gave you the lead, they could make that call for you to start warming up the intro, or at least you’d have a name of someone to call or email and say, “Hey such and such gave me your name. We do IT services, I’d love the opportunity to talk about your IT needs” and it would work.
It’s a good odd chance of success. I did it for quite a while and finally, I gave up the seat I was the president of the Chapter last year and I had to focus on some home stuff for a while, after doing BNI for I think it was about eight years and last September was my last day there but it was great and I may return to it in a couple of years. I’m starting to slow down a bit but it was a very good tool but you have to have the right personality to get something out of it.
You have to be more outgoing and talking and joking and stuff. The quiet people that just sit there like a bump on the desk in the back corner there, don’t get their money’s worth out of it. I don’t see how you can that way, you have to be the talker.
Meet People in Meetup.com
Bryce Whitty: Personally I found going to places like if you go to meetup.com (no longer active) and they have lots of various interests like it could be Android user group or Rosary prayers user group or something like that. For me that helped me a lot to gain my confidence to actually speak. I’m personally quite introverted but going to those sort of places where I knew what I was talking about, got me talking and people would ask me questions and that’s almost like consulting and they’d ask me how I go about things.
For the people that are actually getting stuck and sort of can’t go out and go to a BNI and just start talking to people, try something like meetup first and little less pressure as well because it’s not related to your business.
Brian Mayo: Yeah and after talking about BNI for a minute I think that was a big confidence booster also for me. You should be standing up in front of that crowd, a small crowd granted but you’d be forced once a week to stand up in front of people and talk and blurb about yourself, and eight years of doing that I think it changed a bit of myself too as far as confidence or just walking in and definitely had a positive impact on me. I made a lot of good friends with it, a lot of good business contacts and it was a great tool for us. I think relating to what I was saying before looking for a strategic partner to work with.
I’ve seen a lot of people on your forums, talk about how BNI didn’t work for them. I think you have to do your homework with that. Visit chapters to find a chapter that works for you and as far as what I got out of it BNIs will have I called it like a golden triangle, there are certain positions in the BNI or certain categories, rather, that always well bonds well naturally together.
For the computer guy, in my opinion, it was like I said before with the accountant and a good website person. If you find a chapter that has that and I got a bit out of some higher-end law firms too. If you visit a BNI chapter, the ones with strong people in those categories, don’t have a website person. I think your chance of maximizing your value of that BNI group is going to go down. You want to look for a group that has strong players in those categories. That’s going to be the key to your success there.
Bryce Whitty: These are amazing tips there’s a lot of actionable stuff for the listeners here. To rehash basically you’re saying, “Be super social and to know people”. Basically get out there (put on your old school networking shoes) and pound the pavement. Don’t sort of wait it off to come to you, go out there you may find it, while it may take five hours walking around. You only need one good client that stays with you for years and that’s how you really start making some money.
Also, consider going to BNI, it allows you a bit of a back door sort of past the gatekeepers, so go there and ask who you want and again that gets you to sort of past the gatekeepers. It gives you the in and you also mentioned find the different chapters and especially look for a golden triangle, accountants, lawyers, and web developers. As you mentioned seems to be pretty and go out and find strategic partnerships. What works together well and it sounds like being a gamer paid off.
Brian Mayo: Going back to your youth there, your parents lecture you for being up on the Atari or Nintendo system to the wee hours of the morning. “Do your homework your games aren’t going to make a living for you.” I don’t know it kind of worked out okay for me, it put me in the right direction. I started taking computers apart, putting them back together, upgrading them, modifying them and opened up all opportunities for me to carry me to where I am today. Going into my last years of work.
Bryce Whitty: You’re a great storyteller as well and thank you so much for that like this has been so many tips, there’s so much that people can take action on. It’s very practical stuff.
Brian Mayo: Yeah, I’m glad to help. Your boys are a lot of great resources there, a lot of sharp people there participate on your forums and I’m happy to contribute there. It’s a great resource for the young people trying to start out, to find their way through this ever-changing field certainly one of the fastest-changing fields out there. I want to thank you a lot for the website you built up.
Bryce Whitty: Thank you and thank you for your contribution just for the record you’ve been a member since 2011 and you’ve got nearly nine thousand posts. I have been a member, I founded it in 2006 and I’ve only got two and a half thousand so you’ve definitely contributed to Technibble and the posts you do, some of your posts are like little mini eBooks. You know your stuff.
Brian Mayo: Yeah, thank you. I guess experience with age, I was going to say just bent through it from the get-go and kind of miss the old days at times. It was so much more relaxing back then. I got to say one thing that has changed in this field is the pressure. A lot of clients being in healthcare, insurance, financial we have these ever-increasing strict rules coming across our clients, hit is not a strange word to anyone anymore in this field and you kind of miss the old days. You had a bit of time to fix something, it wasn’t a super crisis.
These days something breaks and it’s like you are walking to your client and half the management is hovering over your shoulder and if you don’t have a fix within ten minutes, they are ready to strangle you. It’s just so much has evolved when it comes to businesses with the importance of the information. Any downtime is major now, it’s just the stress that’s put on, it’s really changed.
I’m kind of glad I’m at my tail end of my years in this career. I can’t picture it in another ten or 15 years what it would be like. Information theft that’s the data, the evolution of malware that is really going into stealing information and personal healthcare, confidential information, it’s really evolved into something else. It’s going to be quite a different interesting game in the near future. People who are getting into this field now knowing what’s going to be ahead of them boy they certainly have my respect it’s going to be something else.
Advice to People Getting into Managed Services
Bryce Whitty: Do you have anything to say to the listeners who are about to go through this process and are getting started with manage services?
Brian Mayo: The biggest thing I like is the variety of it. The manage services we read this on the web all the time I think break-fix for residential is declining. Profits from that, people are struggling to try to adjust. Getting into fixing smartphones and this and that it’s going to be tough you have to rely on so much volume because your profit from that and your margins are quite small on those.
Things have become very disposable.
When I got into computers we were spending three, four or even five thousand dollars on personal computers and there was big profit in that. People picking them for a couple of a hundred bucks and they’re disposable when it comes to managing business clients, SMB networks, SMB clients. It’s all about recurring study monthly income now. We work on higher-end computers, we really strive to push through business-grade workstations to your one-grade stuff. Workstations that are still close to a thousand dollars, servers that are starting at four or five thousand dollars and go up from there.
The profit is still there on the hardware but profits also are starting to come in on just the recurring revenue, managed backups that’s quite easier to do. Find some really good products and stick with it and just push, push, push to those. Aim for the higher-end ones when it comes to business. You’re backing up your business clients, trying to compete with the low-end stuff like a crash plane or whatever for 200 bucks a year. Break that down to monthly, what are you making per month on that? You can count that change in your pocket.
There are products out there where you’re pushing backups that are bringing in profits of several hundred dollars per month, per client and those are the ones you want to go after there. The products support themselves, great services they’ve evolved to the point where you don’t have to sweat when your client calls and they say their server is on fire and melting right down. You have faith in your backup product and take it from there.
Restore it do what you have to do but go after the high-end products it’s what we’ve really tried to do. They perform well, they last a client for a long time and they are happy with it after a long time. That’s what we try to go for higher-end clients that want better equipment.
When you are starting out you want to take any client you can because you try to fill your plate but as you start filling your plate you’ll notice that the cheaper clients are taking up more of your time, causing you more stress, they are not as profitable for you. You have to start sweeping them off your plate and replacing them with the clients that want the best of the best.
You want the clients that, “I want the best workstations and running fast for my staff and replacing them every five years and I want the fastest server you can get in here”.
They’re out there.
Just take your time and you will find them. Start building your client base to have those type of clients that makes it easier for you.
Bryce Whitty: That’s some rock-solid old-school networking advice there. Thank you so much for all the advice you’ve given us, we are hitting just over an hour now. Your advice has been amazing so thank you very much for coming on the show.
Brian Mayo: Yeah, you’re most welcome Bryce. You’re starting your day and I’m just going to wind mine down here on the other side of the world.
Bryce Whitty: Talk to you later.
Brian Mayo: All right.
Bryce Whitty: See you on the forums.
Brian Mayo: Great, thanks again for the opportunity to talk.
Bryce Whitty: Thank you for coming on.
Brian Mayo: All right, take care. Bye-bye.
Bryce Whitty: Bye.
Bryce Whitty: That was Brian Mayo, one of the forum members who share an absolute wealth of information. If you are not part of the forums, you are definitely missing out. Whether you’re old school or new school, you should definitely head over to the Technibble forums. See you on the inside.