Terry Hedden (00:00)
I’m excited to welcome our latest guest to the Grow Limitless podcast, Len DiConstanzo, a living legend in the MSP community, a great guy, and he’s certainly fun to hang out with. But today’s session is all about helping vendors grow. You see Len’s been around the block. He’s worked with multiple vendors and helped others succeed, grow, and scale before exiting successfully. He’s going to share some of his wisdom about what it means to be a partner, what it takes to drive channel revenue and how you build a community of raving fans. Enjoy.
Len, it is an honor to welcome you to the Grow Limitless podcast. You’re one of those people that I love to be around. I love the energy that you give off and the passion that you bring to just everything in your life. Whether you’re talking about your relationships at home or at the office, you’re just one of those people that I think I gravitate to and I’m not the only one. There’s just a lot of people. So welcome to the podcast. I look forward to sharing some time with you.
Len DiCostanzo (01:03)
Yes. Well, thank you, Terry. I really appreciate that. you know, likewise, we’ve been in this channel a long time and, you we were just out at PAX aid. guess we could mention that. And it was just interesting as we were kind of roaming the halls and the rooms, just kind of picking up people along the way, just to chat. And I guess that’s one of the beautiful things about our community, right? It’s, it’s fun, you know, people have built friendships and, you know, it goes beyond the business side. So I’ve certainly enjoyed working with you over the years and certainly working in the channel. It’s been a great experience.
Terry Hedden (01:37)
Absolutely, I appreciate that when you know, you know, we kind of go back a long time and I To me, I know you’ve done so many things and you’ve added so many value some so much value in so many different areas But to me your legend starts with AutoTask, but but bring us before that. How did you get to AutoTask? What’s your story man? Tell us what got you where you are today.
Len DiCostanzo (02:01)
Well, that’s a great question because in fact, I just finished a call with a partner, a former Autotest partner that I ran into at PAX 8, putting together a little workshop, actually with you, we’re trying to put together a little AI workshop for MSPs. And I was just chatting with a former Autotest partner. said, oh yeah, Lynn, we met in 08 when you joined DOR. Actually, he told me he met me in 06. Because from 06 to 06 and 07, I actually worked with Kaseya as a third party expert, one of the first third party experts and I had an MSP accelerator program where I helped break fix service providers transition to managed services. So I met this partner, uh, at PAX eight. He’s doing some stuff with AI. So I was talking about the workshop and we got on a call today and I said, Oh yeah, we met at Kaseya not auto task. And then I told them, Oh yeah, I was an MSP before everybody called it MSP. I was a solution provider. So for two decades, I ran my own business grew to 45 employees, sold it in 2001 in one of the first MSP roll-ups. Cause that term was that acronym was just kind of coming around, I called it proactive service delivery model that generated recurring revenue. started teaching my peers what I was doing and suddenly it became this MSP business model. So I did that myself to two decades sold in 01 work with a company that bought me. It was a publicly traded company that acquired me. And, beyond that, I was starting to look for something better. Well, you know, I actually went around for maybe a couple of years telling people how not to be acquired because you’ve been through it. You know, it’s not always the best marriage or something that you thought when you got into it. So hopefully you picked the right partner. And then, you know, once that acquisition ended and I left, started consulting out there and teaching break fix guys how to become MSPs hooked up with Kaseya a couple of years. Then I joined AutoTask and that’s where you know me. A lot of folks know me. I was a, know, channel chief, face of AutoTask, whoever you want to call it. And, know, to this day, no matter what I’m doing, people always kind of go back to the AutoTask which we have, you you were a partner at Autotask and then you started Marketopia and you were, ⁓ you know.
Not only as a partner coming on and telling other partners how to be as good as you are, because you were a great partner, a great business, but then you started Marketopia. You’re coming on and teaching them how to market their business. you know, I met a lot of great folks there. And since then, I guess from Model Task, we merged with Data. I was there about a year before, you know, our executive team left, of which I was a part of and stayed a little longer. Got to work with Rob Ray, who we were just chatting about, doing a great job at Pax8. Joined the company Accordo out of New Zealand. I built a Optimizer for Office 365, the first SaaS management platform like 2020. We sold that and I’ve been consulting the last five years as MSP Toolkit, helping vendors go to market in the channel with various partner types, MSPs, telecom agents and the like. So here I am today, Terry, know, helping vendors go to market in the channel and that’s…
Terry Hedden (05:02)
Love it. Right. I think your perspective is very valuable in the sense that you were a reseller, you had success, so you know what it’s like to go from a one-man band probably to a successful MSP. You then switch over to the vendor side and even building these communities, building these partnerships, building these programs that help people like you achieve what you did or ideally even more. So I think it’s a really valuable perspective and something I think that the audience can really learn from.
Let me start off with this. mean, obviously, you know, when I think of AutoTask, think of a, it was a close-knit group of raving fans. There are people that built their business on AutoTask, that trusted AutoTask, and then they kind of saw you building this community where people enjoyed going to the conferences and they enjoyed listening and learning and growing. And I feel like it kind of created that environment where people can achieve extraordinary success, right? My passion is all about that now, right? How do you help people achieve their dreams at home and at the office? And of course, for so many of us, they’re so intertwined that it’s one and the same.
Len DiCostanzo (06:17)
All right.
Terry Hedden (06:18)
You know, so I see you as a person that kind of was on the leading edge of creating communities. You mentioned Rob Ray, and I don’t think there’s anyone out there that has a name tied toward building communities. it’s almost like Kevin Bacon, how everyone’s connected somehow to Rob Ray. But you were, in my opinion, at least from my perspective as an MSP, the first or one of the first to really do that in the MSP space.
Who’s killing it right now in your mind like if I said, okay what vendors are building that that community where people are genuinely going to listen learn develop grow where the partner where the vendor sees sees themselves as a partner that only succeeds by helping their partners succeed and wants to create a raving fan community where people do come to the conferences do bring energy don’t go there for the boondoggle or the booze but they go there to learn and develop and grow and their partnership with that vendor as well as their business overall. So in your mind is sort of that impartial now third party with a great perspective. Where are the raving fans? Where are the communities that are are blowing up that have a lot of energy right now?
Len DiCostanzo (07:30)
It’s a lot packed in there, man. But certainly I enjoy working with our partners and building our community at Autotask, which I like to say we were the first and the leading edge. But I got to give a shout out to our number one competitor at the time, Kinect was, actually had built out IT Nation.
⁓ And their IT nation events, so I don’t think connect wise has lost any luster I do think you know like any vendor Maybe you’ve got some some issues around your product around your partners and your approach But you know everybody’s always learning as you go so I definitely got to give props to connect wise we actually worked with them a while back building out their partner program and taking them to market and They’ve certainly built on that and continued to grow so I’m not gonna. You know gonna give their props on that
But I think for me, what I learned to build community is you have to be educational. You can’t be a heart seller in this world. And I think that’s what we brought to the table. ⁓ We launched Autotask Academy as probably one of the first education arms of the vendor to show we really cared about our partners. We didn’t want to just sell them our software or sell through them or to them. We wanted to help them grow their business. That’s why we started Engage and Terry. wanted to, you our software had nothing to do with marketing, but we wanted them to know how to market their business and drive. So I think it’s, it’s community building is around education, thought leadership, and then the sales come. And I mentioned ConnectWise.
We already talked about Rob and PAXA. We just left an event that when I walked in the room, I was like, my gosh, is this like the biggest one I’ve ever been at in the MSP space under a vendor, right? Because you obviously have channel partners, ⁓ you know, the channel partners brand where, you know, they have 8,000, 9,000 plus attendees across a broad channel spectrum, different partner types, telecom agents and MSPs. But when you look at the PAXA conference we went to, 3,500 plus people of which, you you obviously got your smattering of vendor attendees and, and, know, PAX aid attendees, but I can’t imagine there were any less than 2500 MSPs and every one of them was energized and love being there and the keynote rooms are always filled and the hallways were, you know, always people chatting and, now of course have so many podcasters and people really invested in this business investor.
Looking for MSPs, to invest in the vendors that were there. So I got to give PAX8 and Rob Ray a bunch of props. And I actually had a lot of fun. Rob asked me that he’s doing an MSP Legends video. So I got to get on there and kind of talk a little bit of channel history. And I think PAX8’s right there right now. And I think Rob has brought that. think you need, one of the things I think I see some vendors missing is a leader, right? There has to be someone the community can identify with. And I don’t want to mention vendors I don’t think are doing it well, but that’s kind one of the things I see as ⁓ folks not doing and not being successful because they’re not doing that. So having a guy like Rob out there, know, at IT Nation now you’ve got, you know, Peter Kajala who just took over the role there and he’s a staunch MSP advocate and former MSP himself. So, you know, and I think you’re doing a great job building your community. You got your peer groups now, Terry, you have your own event. I really think it’s guys like you, maybe me that have been in their shoes, that can have empathy and understand what you really need to help these guys grow. And a guy like Rob, who maybe wasn’t an MSP, but he’s just been so immersed in it that, know, partners just feel like he’s going to help them. And that’s really the key. You build a partner program. You’ve got to help your partners when they need help. Not tomorrow and five days, but make sure you’re resource and I think that comes with having somebody out in front like a you, me or Ray.
Terry Hedden (11:38)
Yeah. Yeah, some sort of personality that they can gravitate to.
Len DiCostanzo (11:45)
And I see like OpenText, a new vendor out there. I got to give some shots to my man, Mike DePalma. He just joined ⁓ OpenText. And I already feel like, you know, just from having someone there, an obscure channel vendor like OpenText, who shouldn’t be obscure, is now coming to the forefront. ⁓ those are a couple of names, I think.
Terry Hedden (12:08)
You you mentioned ConnectWise and one of the things I think I’ve seen, you know, is a common thread is doing more to help the partner grow. And because everyone says it.
But some people dabble in and have a few classes on a webinar or maybe have an article blog on their website or an article in their newsletter and then there’s some partners that actually do it and invest in it and put money behind it and something that you and I were part of at Connectwise I’ve just recently seen replicated at another raving fan community and I thought it was really interesting where people are saying okay MSP if you join this program I’ll invest my money to help you grow. I’ll put my money where my mouth is or more. My goals are as a vendor, right? So, you know, I’ve seen the most successful ones to me are focused on sales and marketing. How can I help them get more leads and more sales? Like at the end of the day, that’s where MSP struggle. It’s not about, you know, I need a new widget. My camera sucks. My laptop’s not fast enough. It’s always about something to do with growth because I feel like once the MSP gets a customer, they’re pretty darn good at taking care of them. The hard part is getting new ones. And you and I were part of a program that was very successful at signing and getting people to pay money to be part of a group, a program. But as a reward, they got leads and they got sales and they got, ⁓ I guess, hope.
You know, hey, join this program and we’re gonna help you grow and we’re gonna start off by giving you 10 qualified sales appointments or a full month of a BDR or 50 % of this marketing program. And I just saw it happen again. I was curious, are you seeing more and more people adopt that strategy of actually investing in the relationship versus just asking for it?
Len DiCostanzo (14:05)
You know nice topic I will tell you that I’ve probably over the last five years taken North of 20 vendors to market in the channel, and it’s really the number one thing I talk about I’ll mention another vendor. I think is is killing it and and You know is coral a cybersecurity vendor I’ve never seen a vendor invest so much in a partner to be successful and when I mean invest I mean real dollars right and helping them go to market and whether it’s a new market or I always like to look, you know, target in the client base. you know, allocating an actual budget to help your partner, you know, in my opinion, growing their client base first, because that’s obviously a new spot. But then, like you said, you know, how do I get new leads and grow my business and how do you invest in that? And I think it’s, you know, it’s just something you have to do as a vendor. I was actually just in a conversation and talking about a vendor having to invest, and if you’re not investing in growing your partners and you just expect that they’re gonna go out there and do it, you’re just gonna fail. Don’t stop by after you recruit and sign them to a contract and then move on. Now you say sales and marketing, I’m gonna say one of the key things is once you sign them, you can’t sign them and forget them, you gotta enable them and I think that’s actually a key element in the part of success journey, a key stage. You can’t.
If you do sales and marketing and you drive leads and bring them to the table, an MSP has to be ⁓ product ready. They have to know the product because that’s why you work with MSPs. The vendor doesn’t do the work, the implementation, the deployment. Maybe in a scenario where you’re working with a telecom advisor or a technology service broker or whatever you want to call the new breed of agent who brings the vendor in to do the deal.
That’s a sales and marketing enablement for the most part, even more of a marketing enablement. And, but when you’re working MSPs, make sure you also have a great enablement component. And I think that’s a great investment. What does that mean? Heck, I’m going to put you in some classes, whether I have a great portal with on demand. And if you want to learn on your own, go for it, but you want to come to a class. I’m going have a workshop. I’m going to do them in your towns, in your areas. I’ll send someone into your business, depending on.
perhaps a potential, but enable that partner, invest in that. And then of course, as we saw lot of success with Terry is, how do you help them grow a business? Coro dedicates a BDR to their committed partners. Kinequist dedicated a BDR, brought you guys in to make phone calls, schedule appointments and be like a part of that MSP’s team. And I think again, that’s the investment you need to make. you know, totally great topic and that’s how you kill it as a vendor building your channel.
Terry Hedden (17:10)
Totally agree with that. And to me, I call that being a partner. It’s easy to be a vendor. I can create a fancy pen and say, hey, sell my pen. Please, sell my pen. Here, you want to sign up to be my pen broker? You can make 18 cents a pen. It’s a whole nother thing to say, I’m going to help you do it. I’m actually going to stand side by side with you, help you generate leads, teach you, help you do it for you, something. I’m going to be there to help you achieve your goals, Mr. MSP, Mr. Reseller, because I want to be a partner and not a vendor. What are the other key attributes.
Len DiCostanzo (17:41)
I got it.
You actually brought up a point. I remember when I was an MSP or a solution provider, first off, the reps would change all the time. And they would come in and like, sell my product, sell my product. I’m like, well, what do you mean sell my product? And it’s kind of what’s driven me to today, how I create partner programs. What do you mean sell my product? How long does it take to deploy your product? Do I get a demo product? I got to pay for that? What do you mean I got to pay for education?
I’m an extension of your sales team. So it’s like incredible. Like you must invest in your part of community to help them grow. And don’t just say, sell my stuff. I’m going to help you sell my stuff with your stuff. I’m going to teach you how to package it all up. Because MSPs don’t sell a vendor’s solution. MSPs sell their solution. It just so happens that their solution has multiple vendor.
Products in it now gas, you know hardware software But if that MSP is not wrapping their service around it either in a project or in the managed service world That MSP is not doing right by themselves and building their own value So yeah, don’t don’t say sell my stuff like let me help you sell my stuff inside your stuff because I understand your business You know, you have to know your partner type and and how to kind of help them grow their business So I just sorry I interrupt you. I was just
Terry Hedden (19:06)
No, I think it’s…It’s important to emphasize because a lot of people miss that. And it’s so funny, you’re talking to a vendor and you’re like, to them it’s their world, right? Their widget is their world. so I get that part. But then you’re in these conversations with them, like, you do realize that if they sell just your product, they will be bankrupt in like three weeks, right? Like your product isn’t a solution, to you it is. And to whatever, however you define the world, your product could actually be a solution to a problem that. But in the grand scheme of it, no one represents a solution. I think one of the things I found comical about conferences this year is everyone says that they’re the stack, right? They’re like, the collection of security tools that you need to be successful when an objective third party be like, okay, don’t get me wrong, it’s great, but there’s a lot more to securing a client than your product.
Vendors that realize that and understand that not only do they have to be prepared to help partners bundle in other products But obviously managed services project service services Consulting services. It’s all got to come together for the partner to make a dime Because the cost of sale the cost of client acquisition is so high that every solution has got to be bundled hardware software services upfront services consulting can services implementation services ongoing for managed services and then some sort of a reset refresh or reconsideration cycle is all part of what’s required for an MSP to achieve 10, 20, 30 points of net profit and the ones that focus too much on the hardware and not enough on the services are the ones that are dying right now. Is that something you agree with or am I off base?
Len DiCostanzo (20:51)
I always start like now I see a lot of MSPs think they’re an MSP because they resell SaaS and it’s recovering revenue. And I always say like, look at your RMM. You don’t sell an RMM. You build services on top of it. that made you an MSP. So if you using a SaaS management platform, a SIM, ⁓ you know, a cyber stack of multiple solutions now in one, because Gartner defined the SASE term, make sure you’re not just reselling SaaS, but building not only your project services on top of it when you deploy it, but also as a managed service. And I’m going to touch on something you said earlier too, Terry, you hit it on the head. It’s like, I can tell you if I’ve taken 20 plus vendors to market, there may be, I’ll just bring up two that popped in my head and I, and I’m not going to bring up names, but the all in one blah, blah, blah platform.
Terry Hedden (21:49)
Yeah.
Len DiCostanzo (21:52)
Do you know, I was at AutoTask and we had a PSA, which was a unified platform because we had CRM and project management and ticketing. But we didn’t have a fantastic marketing engine. We didn’t have an RMM until we bought one and integrated it. So as soon as you say you’re all in one, in my opinion, you might lose credibility right out of the gate. And if you’re all in one and it’s actually all bundled together and you think you’re going to go to an MSP or some partner and go.
Here’s my solution. You don’t need anything else. Well, they probably already have most of what’s in your stack already in their clients. Like, what are you going to do? Are you modularize? Can they buy land with one module? And then if they like it, start taking the other ones out. Like what’s the plan that you can give that partner to roll out the rest because maybe you have a better price overall, maybe you’re actually a better solution, maybe you simplify their management because you have at least, you may not be all in one, but you’re 10 in one or 14 in one or five in one. So you’re not the first if you’re an all in one and you’re never all in one because there’s just too many things out there. And if today you have an all in one with the pace of technology today. There’s going to be something tomorrow that is going to be a shiny tool. Somebody’s going to be coming to the channel. you got to have this, you know, because hackers have figured out that. So it’s, you know, interesting kind of topic, right? All in one. I’m it.
You don’t need anything else. That’s not true. And stop saying Unified Platform because most MSPs don’t even want to look at your dashboard. They want your dashboard to feed their ticketing system, which happens to be in Autotask or ConnectWise or something like that. You know, and the new players in the market, all the new PSA guys out there. yeah, yeah. You know, that’s cool. That’s product marketing too, Terry. You got to know your audience and make sure you’re speaking to it right.
Terry Hedden (23:52)
I’m with you because it’s something that sounds good in a marketing sense, doesn’t necessarily resonate with the person you’re talking to. If they’ve got 80 % of that solved and maybe they have one product in there that they love, maybe they’ve found a partner who really cares about them and it’s invested in them. They don’t want to replace that partner. That’s a bigger decision for them. So I think it’s a really valid point is to build a partner program. You’ve got to have a go-to-market strategy that allows you to meet the partner where they are, not just at the product level, which is what we’re talking about here, you know, hey, I like this part, but my problem’s over here, can I start with this and then maybe reconsider over time? But also, of course, at the partnership level, the business level, I need help in finance. Teach me how to make a profit. I think one of the faster growing parts of Marketopia right now is what we call MSP Elite ⁓ Sales and Marketing, we, ⁓ MSP Elite Peer Group, where we were literally diving into the finance and saying, okay, how are we going to increase your EBITDA?
Everyone that almost everyone we found out there is not growing as fast as they want to grow and part of that is because they’re not doing what it takes to get leads and close sales but part of that’s they don’t have enough money to invest what they need to invest to get what they want to get in terms of growth and so we help people find that money by really analyzing their P &L by analyzing their sales motion their sales team their marketing efforts and frankly a lot of MSPs are overstaffed on the service side they over invest in the tools and techs necessary to do the work to the point where they can’t afford to invest what it takes to get more work to do. You know what I mean? They’re kind of spun in that. Have you seen that in your MSP consulting? I know you do a lot of that as well.
Len DiCostanzo (25:32)
Yes, I think, you know, it’s, it’s always a balance, right, Terry, you need to write tools in place, but, you know, I often say it took me, you know, 10 years to get promoted to be CEO of my own business. Why? Because I was a tech first, you know, and that’s how I started my business. So I do think having someone like you or a peer group where you with your peers in, you realize it’s not just a tech stack. It’s not just my tools. And in fact, it’s not just my texts. Like you actually need complete business ⁓ machine right from your demand gen efforts to you know easy to work with for your clients just like vendors as they build a partner program like you could have the great product you could have you know great people but if you’re hard to do business with no one’s gonna work with you right if you’re a contractor or difficult or you know you got a paper every deal or whatever so I think it’s a great point. You got to look at the numbers and it’s a balancing act and you got to just have a real company. When I say it took me 10 years to get promoted to CEO of my own company, it’s because I finally realized I had to grow my business to build value. I had to drive sales. I literally have to do marketing, what’s that? And that was a rude awakening. And in fact, I remember applying for my first chunk of market development funds. And I did it with ⁓ an old vendor called Compaq, for those that might remember it. And I remember getting $10,000 because I was now gonna, a buddy of mine started buying buildings and we had an offering called managed building services. This was like, even, I don’t want to say the years, but it was pre-managed services. And we basically were going in and wiring up the buildings and every tenant, we were their IT department and we set up in the lobby. And as people were coming in, we were like the IT company for the tenants. And I used that marketing funds to start getting my first set of leads. And, and from there, you know, we went from, I would say we were a five to seven employee company for 10 years and we kind of grew up to be about 50 or so employees before I sold the business. it’s you got to look at the whole business with peer groups now it’s easy and you got to kind of well round yourself for sure.
Terry Hedden (27:57)
Len, how long did it take you to get to 45, 50 employees? I didn’t realize your MSP got that big, man. You’re even more of a legend than I thought you were.
Len DiCostanzo (28:05)
Well, like I said, my first few years it was me working in the business, not on the business. I would say that if it took me 10 years to get promoted to CEO, it was maybe over the, maybe it was like 19 years, the numbers are escaping me now, but it was probably from around.
I would say it took me to go from five to seven employees to 45 to 50. It took me about seven years. Seven, eight years. then I sold the business. So I mean, it was a slow, steady climb, you know? Right. And I could certainly… How did do it? Some of the wisdom I learned, but you know, that’s okay now. Everybody’s doing acquisitions and peer groups. So, you know, I can give my tail, but…
Terry Hedden (28:50)
Like you know. I mean what percentage of MSPs do think get to 45 people? One five. It’s a real small number. You know it’s hard.
Len DiCostanzo (28:58)
Yeah, it’s hard to do it. think now you see a lot of folks doing it through acquisition and you know, I’ve seen MSPs who maybe aren’t ready to be acquired because they’re too small start to band together and merge their businesses. you know, couple of different ways obviously now, solidation, ⁓ know, your own merger with friends, because that’s another thing this community has done is put competitors together, literally competitors who do the same thing, sharing in a peer group setting how they’re being successful. Crazy. And then you get to know your peer and next thing you know, you know, hey, why don’t we get, you know, joined together? Because instead of being a $2 million MSP will be a 5 million MSP. And then let’s go there and there. Now we’re a 10 million MSP and now we’re kind of packaged up nice. So you see a lot of different approaches to growth, but there’s nothing like your own organic growth and growing your own business. And, you know, that’s, that’s a beautiful thing. And it’s amazing how you’re helping guys do that, Terry, in the peer groups for sure.
Terry Hedden (30:04)
We’re trying really hard. When I sold and I started to reflect on my life and I was blessed. I was blessed with great opportunities. I didn’t grow up with money. I didn’t grow up with great fortune. It’s behind me. I made some really good decisions in my life.
Len DiCostanzo (30:25)
Thanks, but you you you grew beyond them right? I’m sure I’d add it to your grit
Terry Hedden (30:31)
Well, mean, everything, can’t really be upset about anything in your past because it makes you who you are in your present, right? So sometimes it’s good things that help you and sometimes it’s not. I really, my passion has been helping people and it’s hard to do. It’s really hard to do. It’s hard to help individuals. Even, know, Markatopia is blessed with some amazing team members. You know, pushing people to grow and achieve their potential is not easy. You know, it’s not, it’s not always well received. Some people would rather be content with who they are and, and satisfy us and, and, and they don’t want to be pushed. And I find a similar thing at the MSP level. It’s like, I have a dream. Everyone’s got a dream. They want, they have a vision for what their future looks like, but it’s a small fraction, honestly, that already is equipped to get there. And then there’s another small fraction that is absolutely ready to do whatever it takes and will, your advice and follow it and achieve that. And then you start gradually coming down to where you have people literally who will sign up with something because they need help because they’re not good at something and then proceed to tell you how to do it, disagree with everything you recommend and resist any change that you know is necessary to get there. And I’m sure you’ve seen that on the vendor side. You go around now consulting with vendors, helping them build their channel programs. What’s your top five things that a vendor needs to do to be successful today?
Len DiCostanzo (31:59)
Well, that’s a great question because I have the five perhaps in my head and really it kind of goes along with what I call the partner success journey. Right. the five stages I talk about all the time is recruit, recruit, recruit at stage one. What does that mean? You’ve got to have a good program, a good set of benefits and incentives to recruit your partners into like your son’s a stud football player. Right. What made him go to the college he was going to? They probably had a program that they recruited him into that had you know a great stadium and great fans and tutors and you know private classes and whatever it may be a new bus a new plane who knows but build your program so that you have a program to recruit partners into look at them as you know
Who’s a tall athlete? Who’s a fast athlete? Who’s the, you want different partner types. Cause like you said, you know, there’s different people at different steps of their journey that can be successful. So build a program, find the right partner and crew them in. Have an easy acquisition process. That’s like the second thing. Like, what does that mean? Like I just was chatting with a vendor and as we’re revamping that program, every deal a partner did, they wanted a contract signed.
That doesn’t make it easy to work with, like sign them up to a contract, lay it all out in the beginning and then let them go sell, get them into that next stage. Don’t sign them and forget them. Go to that third important step, which is enablement. Now you got to enable them across a couple of key areas, know, marketing. Do you have the right marketing stack that you’re like a Marketopia offers? Like what is your partner marketing stack look like? What kind of assets do you have a webinar in a box? Things like that, ⁓ product enablement, financial, how are you going to build them? You know, what does that look like? And I think, you know, sales enablement, right? How are they going to go out after they drive awareness? How are they going to say, but sometimes an MSP doesn’t have to sell your product, especially if they’re rip and replacing something they have. But it also might be something that they could just go in and say, Hey client, you really need this based on the changing landscape. Let’s say of cyber. So it’s recruit, acquire, enable, and then.
Fourth stage, fourth important thing, what’s your activation look like? How will you help them to get in their client base? What are you doing to help them sell? That would be my fourth. Activating them in their base. Then the fifth thing that’s most important is what’s your plans to help your partners grow? What are you doing, like you were chatting earlier, to get them new leads and new business? They already have their clients. Some vendors are lucky enough their product can go right in that base and get activated. Some need that help to get new business. So those are my five key things a vendor has to be thinking about is recruiting, acquiring, enabling, activating and growing their partners in a partner success journey type of flow. And there’s so much in recruit Terry to go, you know, so many things because I didn’t even say like in front of recruit, we all know what’s that Terry, demand gen.
Like I was working with one large vendor and as they were building their MSP partner program, I said, okay, what does partner marketing look like? They kind of looked at me funny. What do you mean partner marketing? Here’s what we do. Basically what they showed me is their demand gen activities to drive partners to talk to their team, to sign up for the partner program.
They really literally had no concept of partner marketing and how they need to make co-brandable assets and don’t make an asset that a partner is going to hand to a client that says, the vendor for a demo. No, no, they call the partner. Subtle changes like that on your marketing assets. you know, so, you know, a lot of areas that, that I guess surround the five stages, a lot of detail behind it, right?
Terry Hedden (35:46)
Right. Yeah, I love it. I think you’re five and maybe six if you want to add that one in there. are great kind of principles to live by. If you want to build a partner program that’s sustainable, that’s attractive, that can help compensate for any challenges in your product, whether they’re today challenges or in time, the better the partner you are, the better the partner program you build, the more attractive partnership is with you. And partnerships always have their ups and downs. So how do you get people to stay there? And I think some vendors seem to just think it’s all about the product.
And then some vendors, it sounds like your clients probably realize it’s just a lot more to it than that. It’s like, hey, listen, it’s not enough to have a great product, partially because everyone’s, the next person’s great product might be almost as good as yours, maybe even a little bit more today or tomorrow. So how do you compete on another scale? How do you level up to a different level and build a program that is just, has a long-term attractiveness? And you look at the ones that are, have really done that. And you look at Cisco and you look at Microsoft and you look at the billions of dollars that Microsoft and invest in their channel. And then you see the competitive advantage they have out there. mean, the reality is they’ve built an army of loyal people that are supported and loved. And Microsoft is certainly not perfect. They have a challenging program to maintain your certifications. But the reality is they’re there for the partner. They’re investing in the partner. And sometimes, I’ve learned in the last few weeks especially, is a whole lot of partners leave a lot of MDF money on the table. So they’re even more generous than their partners even realize.
Len DiCostanzo (37:35)
Yeah, there’s some big numbers out there for MDF, not only Microsoft, but across the spectrum. But interesting you brought up Microsoft, because one thing I’ve seen an interesting shift is, and this is even over the last decade, I still remember at Autotask when we acquired a company sooner and we built a product called Autotask Workplace, a file sync and share solution like OneDrive. And we had partners who were like, I’m not working with OneDrive, I hate that. And they adopted our product, it was tightly integrated, it worked. But what I’ve seen over the last couple of years is instead of partners like looking at Microsoft to go and I don’t want all my eggs in one basket, you know, clearly now there are partners out there that just focus on the Microsoft stack and are starting to shed non-Microsoft solutions. So they’re doing a pretty amazing job. I think, one of the things I talked about, my five key things you got to do, I think the ultimate key thing, and you said some vendors think it’s their product. Well, at the end of the day, you could have a great program with great benefits, but if your product doesn’t work, you’re going to be found out.
So, mean, I can’t say it enough to my, my vendor clients and some of them, you know, they, they ignore the product. think, yeah, MSP won’t see that. They won’t like that’s what they do. They’re going to look at your product, make sure it works. Doesn’t work better than what they have. What is it missing? And if it’s works, then they’re going to consider everything else. Or they’ve already considered, like I remember vendors coming in and making a splash, even at Autodesk. won’t name names again, but know, vendor coming in, throwing a $70,000 party and partners are going, oh, this is great. I can’t wait to work with these guys. They’re a great vendor to work with. And then a couple of failures happened and the product didn’t work and boom, a mass exodus, you know, to the competition. So ultimately the product has to work.
Just make sure you’re surrounding it with a great program, a great part of success journey, and be easy to work with. I think we can’t say that enough, right? You gotta be easy to work with at the end of the day and have great people. Not only the face, you know, but everyone else on that team just has to be partner first.
Terry Hedden (39:59)
I’m glad you brought up face, Len, because I spent the last week with you, and I left with two mysteries, okay? Two mysteries of life that I’m trying to figure out, right? And I’ve spent, I don’t even know how many hours since I got on that airplane trying to figure out these two mysteries of life. One is how you maintain your tan and don’t age at all. Like, you look almost exactly what you did look like in the mid-90s. What’s your secret? Just tell the world.
Len DiCostanzo (40:26)
Well, first off, that’s a great compliment, but being in my skin, I know it’s not quite the same. know, black hair and it used to come down to here, but.
Terry Hedden (40:37)
I thought that was blonde highlights you have been in there. Okay.
Len DiCostanzo (40:40)
Now, one thing that I think anybody out there has to do, Terry, it took me a while to kind of realize it. And, you know, you, know, I shared a little bit, gotta really be careful. you know, we’re out there at a conference. are going to drink our cocktails, but I always try to make sure now I’m eating all my meals. I’m drinking a lot of water. I’m in the gym while I’m on the road, you know, whether it’s before everything gets going or, cut out in the beginning. So all I could share out there is have a good work life balance. And I’ve learned how to do that maybe over my last, I’m gonna say, what’s it, 20, 25? I’m gonna say probably over the last decade I’ve done a better job at keeping myself in tune with my body. And I gotta give my son a little bit of credit, my son Brandon who you know, much like your boys, I love my one boy, he’s great.
You know one day I’m like, just don’t feel right. This is probably the kickoff. I’m working out, I’m doing all this stuff. goes, Dad, you’re not eating enough food. I’m like, what? You’re not eating enough food. I’m like, what are you talking about? He goes, yeah, you’re not eating the right food. I’m like, how do you know? He goes, well, I live with you, so I watch. So he made me start measuring my calories and sure as heck, not only was I not eating enough food, but I wasn’t eating enough protein, enough this, enough that. So you just got to kind of start somewhere and it’s food, it’s working out. And while I still don’t go to bed early all the time, Terry, I love being out with our partners and our vendors at shows. You just got to have the whole big picture, man. Work life, man.
Terry Hedden (42:17)
You got to figure it out, I got to commend you on the hillside. You’ve done a great job taking care of yourself, man. I got to take some of that medicine. But I want to bring up the second mystery that I have. Maybe it’s a little harder for you to answer. That one seemed too easy, frankly. AI. Where is this going? And if I’m a vendor and I’m trying to create a great partner community,
Len DiCostanzo (42:32)
Whoa.
Terry Hedden (42:39)
How does AI relate to what I need to do now and in the next couple of years? You it’s hard to see much past that, but AI currently feels like a superhuman suit. Like it makes a normal person into a superhuman, like that Iron Man exoskeleton. Where’s it going, Len? Where’s it going? If I’m a vendor and I’m coming to you as a guy who’s been there in the past, look into the future. What do I need to do to embrace AI, to capitalize on AI and survive AI?
Len DiCostanzo (43:08)
It was interesting, right? Cause we’re, we’re in the process of kind of building out an AI workshop. So we got some learning to do, but I, I’ve, built a little AI workshop a year ago and delivered it. And, ⁓ you know, I think even in the last year, the change in AI from just AI to agentic AI, and, know, there’s always going to be a catchphrase, but. Yeah. I think where it’s going, like right now, I, you certainly need humans involved. And I think folks that don’t think you need a human involved, are gonna have a problem with AI because you’re gonna trust it. And it only knows what you tell it, it only knows what’s on internet. And you certainly need human oversight. And that’s how I use AI, right? I use various tools, but primarily I’m a Microsoft co-pilot and using, you know various ways I use it in producing my content and whatnot, but I know from looking at it if it’s good or not, and did it make my words better than I had? So I think keep your human oversight. It’s not taken over the world just yet. It only knows what you tell it. you know, it can, I think you can be more creative as a human, but where it’s going is it’s just going to infiltrate everything. You see vendors putting it in their products. It’s been around a while. I mean, I remember six years when we built Cloud Optimizer for Office 365, we talked about machine learning and AI. So it’s been around for a while, but like anything, it’s a term that gets picked up and then momentum starts and now AI is the thing.
The reality is you have to figure out ways to grow and improve your product. What better way than to have it be more automated. And that’s really where AI is going to keep on going. I just think it’s going to automate, automate, automate, and it’s going to be simpler and simpler instead of API’s and writing to an API. You’re just going to say, Hey, I go get this data from there. Put it over there, mesh it together and give me some dashboards and it’ll get it done. So where it’s going is keep the human oversight. It’s going to be in all your products. Don’t look for one solution because just like we talked earlier, you know, it’s not just one all-in-one AI product Maybe we’ll see that I don’t know but you know Keep your eyes open and look I keep seeing this one guy do a commercial like, you know do 15 minutes a Day for the next 40 days and you’ll know these 40 AI products Well, we already know it is like hundreds and thousands of these AI tools. So you the human into it, look inside your product, what’s in there, and then how can you use it to just improve yourself until the one day maybe it’s really smarter than you, which again, it only knows what you’re teaching. So keep your hands on the pulse of it.
Use the tools with your own oversight is where it’s going for now for me. Don’t, a wise man once told me, don’t abdicate, delegate. Don’t abdicate your responsibility to make sure that what AI did is right. You’re delegating, it’s like an employee or someone that’s doing something for you and make sure you’re managing it. And that’s how I treat AI and how I recommend it.
Terry Hedden (46:30)
Right. You mentioned something there I think is pretty insightful is to look at kind of two AI in here and now in two lines. One is what can you do? What can you leverage AI to do within your product and what value your product brings other people. So maybe using it for R &D development, but also integrating with it to help the user work with whatever it is they’re working on within the product is sort of round one, like product-centric AI integration and capitalizing on AI. And then the other one, I don’t know if it gets enough time, which is investing in helping your people learn how to use AI in their day-to-day so that they get that exoskeleton.
If you’re a vendor and you have a product that is evolving quickly because you’re leveraging AI and it’s easier and easier to use and more and more automated to execute because you’re integrating AI is like step one. But step two is like, if I can get every person on my team to leverage AI to make themselves better, faster and cheaper in terms of the production they produce, all of sudden now that’s a really amazing one, two punch for the near term, right to look at it from both ways. Would you agree with that? Do you think vendors and businesses are doing enough to encourage the individual or are they not?
Len DiCostanzo (47:54)
I think that’s a great point, Terry. think it has not made it down to like, how do you get your people to use it better? Again, I think Microsoft’s doing a great job with Copilot and pushing it out to every user. But I implore MSPs to build a practice around AI. was our original workshop is you got to make sure you’re training. You have an acceptable use policy even, but you got to show folks how to use it. And it was probably the one line item on all my proposals that prospects and or clients would balk at and it’s the training and adoption line item on a proposal. So imagine you’re an MSP and you do a X dollar proposal for your client for updated infrastructure will include to copilot we’re gonna you know put this AI in and I’m gonna have one hour training sessions every day for a month, a three hour workshop, and then we don’t really need that training. They’ll figure out how to use it themselves. Like what? So I think MSPs, it’s your job to make sure if you’re rolling out a solution, kind of like.
You always had to do is one thing to throw out a network with all applications, but did you show everyone how to use it? It doesn’t change. Now that AI is in the picture, you still have to show folks how to use it. And there’s clear ROI. Like I remember taking 10 folks signing federal express forms to ⁓ slap on boxes and ship them. And I walked in and said, what are they doing? filling out labels and put them on boxes so we could ship them. like, I could put that on a computer write an application and it’ll have all your contacts just type a number of boxes it’ll print it on this printer and you don’t need ten people well it’s not like those ten people went away those 10 people ended up doing something else more valuable and those principles still apply. And that’s one thing, Terry, I guess we talk about my longevity and your longevity. Things haven’t changed that much. It’s just a technology that’s changed. It’s all about efficiency and making sure you know how to use the tools available to you, the automation available to you so that you as a human can do that more creative thing, that more strategic thinking. And that’s, again, I think another kind of directional impact of AI. Getting the moving, ⁓ automated process, so you can go do something better.
Terry Hedden (50:18)
Right. I see AI as the greatest opportunity in the history of the channel. feel like ⁓ the long, long term, it’s anyone’s guest. mean, whether if it continues on the pace it is, obviously there’s going to be pros and cons there. But, you know, I find it hard to believe that it’s going to maintain the pace that it’s on right now, because it seems to be getting twice as good every quarter. But I do think right now in the near term, it represents an incredible opportunity for MSPs to make a lot of money to deepen their customer relations ⁓ to go up to the C-suite and really start influencing the entire business, which should open up doors in other areas because so much of the IT spend now is not on infrastructure. It’s not even in the IT department. Most of the sales and marketing organizations have more technology spend than anyone now. And I feel like AI gives the MSP that ladder that they need to climb into that C-suite and start being perceived as a partner that’s bringing value across the board. And it’s easy.
Because AI when I was when I was in consulting I used to work with Jack Welsh and Bob Nardelli and some just amazing leaders I I had to know things I had to know a lot of things and had to come up with great ideas almost on the fly these days You kind of have AI as a crutch to help you consult on AI So I think it’s a lot easier to be a consultant, especially at the SMB level on AI so every MSP that’s sort of resisting that temptation and seeing it as a threat and wanting to bury their head in the sand, I see as an existential threat to those people because the people who do embrace it and do bring it to market and do bring it to their customers are gonna be the ones who are the long-term technology partner. You know, it’s not enough to be a Cisco goal partner, Microsoft goal partner, to be really good at fixing printers. That’s not gonna get where you’re trying to go and it’s not gonna be where a partnership is because the person who’s coming in and helping the customer increase efficiency, improve customer support, ⁓
Driving innovation and and bringing AI and leveraging AI to the most ⁓ Is the one that’s going to be perceived is going to be the ideological long-term partner, right? The days of like an MSP getting in good graces of the CEO because they brought the idea of two monitors to the table are over the standards are much bigger and I think you talked about agentic AI man What can’t that do in the near term to really make a difference to automate especially?
those low-end repetitive tasks. It’s just amazing and I feel like MSPs are well positioned to capitalize on it if they choose to, if they embrace it and if they go. I know you and I are building a workshop to do this but I’m guessing there’s some things that you would recommend MSPs do right now to capitalize on the AI market. What do you think an MSP needs to do?
Len DiCostanzo (53:09)
No, it’s fine. was going to throw that in even if you didn’t ask the question, but the one thing I’ve always pushed my MSP clients to do or the partners that work with us was use it in your business yourself. mean, you know, yeah, we, we use to your dog food. You know, I was once told if you do an international, don’t use, you know, sayings like that, they may not know it, but, you know, use it so you know how it works and how to implement it. And it’s also the time where you start to
Terry Hedden (53:22)
Eat your dog food.
Len DiCostanzo (53:39)
define your service catalog and the different services you need to do, like discover the data that is even going to be put into your AI model. You know, how do I protect that data and make sure people aren’t accessing data that they shouldn’t access? And there are so many things you’ve got to do to implement AI that if you don’t do it yourself, you’re just going to flail at a client and actually ruin whatever maybe goodwill you had. And I think it’s like anything else. It’s always been use it, learn it, understand how to deploy it, and then go out to some closely helped clients.
Deploy it for them, learn, maybe they’ll let you fail a little bit, you know, you don’t crush their business. And then you can continue again to roll it out to clients before you go out to strangers. And, I think it’s again, part of enabling them, activating them and grow. And one of the things we, I always try to do with my, vendor clients is you want partners to sell your stuff. What is the special price you’re going to give them to deploy it in their business and how are you going to help them deploy it? And even going in and saying, Hey, MSP, you this long to do these types of services to deploy it and then take it out. So that’s my number one is use it yourself. Think about an MSP. If they could remove a level one tech from their process by using an agent who can look at your tickets or previous resolutions and apply AI to resolve a level one issue or escalate it.
Now you’ve freed up a resource to do something else. And you also have learned how to go help your clients do that very same thing. You know, your clients have to talk to their customers. So maybe they have a support desk for their product or service. So again, use it internally. You’re a business yourself as an MSP and then go look at different use cases that you may have solved, even document your use case and then go look for them inside your base and go out.
And, you know, don’t talk infrastructure. I can’t, how many times, Terry, MSPs are infrastructure focused. They do tech infrastructure and manage services.
I remember when they didn’t know how to monetize beyond the license of Office 365. Oh, I only make 10 points or 15 points. And then we built a Cordo Cloud Optimizer. Now you have SaaS management platforms helping you do SaaS management around license management, spend, adoption, security, cybersecurity. You got to expand your business. now AI is just that next great opportunity, like you say, Terry, to grow your business around, expand your offerings around.
So eat your own dog food and then go out and feed your points, you know.
Terry Hedden (56:33)
Absolutely. Len, tell you every time I’m with you I learn something. I also have a good time doing it. I appreciate you man. I appreciate everything you do for the channel. I’m one of the people who has benefited from the relationships from the very beginning dude. I appreciate you and all you’ve done. Is there any parting thoughts you’d like to leave the audience today?
Len DiCostanzo (56:51)
Terry, it’s great chatting with you as always too. I mean, we’ve been doing this a while and again, I always learn. I think that’s one of the key things, right? You know, we’re all peers, we all learn from each other and that’s what makes this community so great, you know, willingness to share our expertise. So I appreciate you for doing that, not only with me, but with your hundreds of MSP partners you work with. So good luck to you guys and I look forward to doing our AI workshop. That’s what I’m sure.
Terry Hedden (57:20)
Absolutely, I appreciate it.
Len DiCostanzo (57:22)
We’re over at Pax8. We got to give him a plug too, man.
Terry Hedden (57:25)
Yeah, absolutely. I’m looking forward to working with him too. Awesome. With that, we’ll wrap it up. Len, I do appreciate you. Thanks for joining the Grow Limitless podcast. Hopefully our audience has learned something that’s going to help them take their business to the next level.
Len DiCostanzo (57:37)
All right, Terry, thank you guys. Appreciate it.
