Note: This article is taken from a live interview and has been edited for clarity and length. Patrick Jacobwith joined Sunset Technologies as CEO in 2013 and has grown the MSP from $2 million in annual revenue to over $20 million, building a niche in the dental market. Today, Sunset Technologies, which was founded in 2005, serves clients in over 35 states, bringing cybersecurity and HIPAA compliance to dental offices across the country. Robin Robins, founder of MSP Success and Big Red Media, spoke to Jacobwith about the benefits of niching down and the key to their massive growth over the last decade.
Robin Robins, Founder, MSP Success and Big Red Media: Let’s talk a bit about Sunset Technologies in general. Were you the founder, or were you brought in later?
Patrick Jacobwith, CEO of Sunset Technologies: I was brought on in 2013 as CEO. The original founder’s name is Brad Kerr; he just retired but is still the owner in the background. He and I have gotten very close over the years. When I came in, we had around 15 employees and were between $1 and $2 million in revenue. Now, we have a little over 100 employees, and about $20 million in revenue.
We’ve grown partly through organic growth, but largely through acquisitions. We’ve become a national player. We now deliver day-to-day MSP services across the country—we’re in somewhere between 35 and 40 states. That’s been a major goal and initiative of ours.
Robins: There’s a statistic that 80% of MSPs are under a million, and they never break that million-dollar mark. From your perspective, what are some key things that MSPs must do differently to get to that level of revenue, profitability, and growth?
Jacobwith: There’s a quote I use with our leadership team: “What got you here will not get you there.” I think a founder/owner especially needs to understand that they can, and should, bring in other people and let go of some control. In many respects, they have to take their hands off the wheel—that means putting structure in place.
Once you bring those people in and have that structure in place, you gain the ability to scale. If you have 100 customers today, think about how you would continue to deliver the same level of quality for 500 or 1,000 customers. That’s when you have to ask questions
like these: How are you delivering services? How is the operation? How is your customer base? Now you’re focusing on the larger efforts, like your purpose and company culture.
Robins: So, you’ve built an entire business in the dentistry niche. I’ve heard people say dentists are cheap. Is that true? And if it is, how have you been so successful with growth in a cheap niche like dentistry?
Jacobwith: Dentists get a bad rap, quite frankly. I know a lot of cheap people that aren’t dentists. Within that niche, we find that we’re in a position to educate more. This is a group of people who don’t necessarily have much business acumen. I think it’s a challenge for health professionals, especially dentists, because they’re not getting some of that underlying education. Are they cheap, or are they just not necessarily understanding some of the larger business decisions that they need to make?
That’s where we can fill in some of the gaps for them. Once we help them see the bigger picture, then they can really understand the value of what we’re providing, which isn’t necessarily IT. It’s uptime and performance.
Robins: Right, great. So, as a national firm, how are you selling? Do you have salespeople across the country? Are some of your customers and salespeople remote?
Jacobwith: We have developed a very strong referral pipeline with our existing customers and, more importantly, in a national setting with referral partners. So, we’ve got other business entities that we do business with. These referral partners want to connect with us, because then we can help them more seamlessly integrate into the environment. That’s really been a great source of new customers for us.
The other area that has been super beneficial for us is being viewed as thought leaders in the dental space. I’m personally on stage at least a dozen times a year, if not more, speaking on cybersecurity or different levels of education in the market. Those speaking opportunities turn into a lot of new business for us—more than I think we originally expected.
As for our salespeople, they’re not spread around the country. They’re in a few specific geographies but will sell any geography. Actually, 90% of what we do in terms of our day-to-day service delivery is remote. We have remote support 24/7; we have people working overnight so we can answer the phone live. Once the salesperson closes a deal, we have a whole structure of W-2 employees and independent contractors who cover on-site needs.
Robins: If you had to start a new MSP tomorrow, would you still pick a niche, or would you take a different approach?
Jacobwith: Great question. If I had to do it all over, I would niche. It gives you clarity on what you’re building, how you’re building it, and why you’re building it.
If you do it well, the ability to scale and broaden scope comes later, sometimes in different ways. It could come through being acquisitive or through doing a transaction where you’re rolling up into some larger MSP. You become a business unit either way.
I think you have more options when you’ve clearly picked a lane and when you’re helping your team understand and identify with who you are. Trying to be everything to everybody can water you down at the very beginning in ways that may not be useful for growth, or for that later opportunity down the road.
There’s also the authority piece of it; I’ve been presenting on HIPAA since 2013. I’m viewed as more credible because we’re in a very specific niche. So when I talk about dental cybersecurity, for example, it holds more weight.
Robins: Any final thoughts for anyone who’s trying to grow an MSP?
Jacobwith: What I’d say to any founder/owners deciding to grow, is that it’s your ability to bring other people onboard and allow them to take your baby and do some different things with it [that will allow you to grow]. It’s a tough moment, but if you’re able to make that adjustment, it’s also exceedingly rewarding.
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