When everything goes wrong, the real winners don’t panic; they stay cool, focused, and driven.
Jeremy Davis, president of CloudMinders, an MSP based in Portland, Oregon, had to get scrappy to pull his MSP through some lean seasons, but he came out on the other side ahead—and a better business owner for it. Here’s how he did it.
The CloudMinders Mindset
Davis started CloudMinders in 2015 with the intent to bring high-level technology services to small and midsized businesses. “Having worked with both large corporations and startups, I saw a gap in the market for reliable IT solutions for smaller companies,” Davis explains. “We try to give our clients a white-glove service, regardless of their size—treating these smaller companies as a priority and as if they were a larger organization.”
Davis shaped the whole ecosystem of the business around this ethos. “We want to be more than just a transaction—we aim to be true partners in our customers’ success through technology,” he says. A key part of this vision has been hiring the right people who are both personable and tech-savvy. “It’s been challenging, but it’s crucial to our success. Then the next thing is basing all our decisions on our core values. If something doesn’t align, then we don’t do it.”
Surviving the Lean Seasons with Ingenuity and Scrappiness
CloudMinder’s growth was steady until COVID hit. “Oregon had strict policies,” Davis says, “so many clients went from 50–60 employees to just one or two—resulting in a ton of lost revenue since we charge per employee—or [they] shut down completely. Also, our clients were already set up with remote capabilities, so while other companies saw an influx of hybrid-working requests, COVID was a massive blow to our company.”
“It taught us to be lean with our setup,” Davis says. “Unfortunately, I had bought out my business partner in December 2019, so we didn’t have a lot of extra cash laying around. Also, the problem with buying out my partner is that I switched from an LLC to an S Corp—so we didn’t get [much] of the PPP money, because we were considered a new business. So, while other people I know got a couple hundred thousand dollars to keep their employees on board, I got $13,000, which was nothing really.”
“We had to get lean; get scrappy. We basically got rid of all time-and-material clients at that time and just focused on our MSP clients,” Davis says. “I wish I was able to do that in a more mindful way, and try to bring some of those time-and-material clients up to managed services [clients], but [at the time] I looked at the revenue and how much time we had with the staff we had, and [decided] to focus on the people that were managed services already and keep that going.”
Post-pandemic, scaling the business back up has gone much smoother. “We’re always improving our processes, but we’ve just become a better company from doing that. It’s been a lot easier [to scale back up].”
In a trial-by-fire moment, CloudMinders even had the opportunity to test this theory last year. After losing 25% of their revenue due to multiple clients shutting their doors and one being bought out, they’ve made back all of that revenue in the span of a year—and are now growing beyond where they started.
CloudMinder’s Sales and Marketing Tactics
CloudMinder’s marketing largely hinges on networking and events—but what stands out is their referral program. “We give 100% of the first month’s invoice for services for our referral program [incentive]. That ends up being pretty good; we’ve [given] a check that was almost $17,000 before. If someone refers us, I’m more than happy to pay them for it,” Davis says. Referrals don’t have to come from clients either; Davis’ employees and even his neighbors are eligible for the referral program.
The MSP’s biggest catalyst of growth has been consistency. “Pushing sales, being consistent, and doing the things every single day has been huge,” says Davis. A key component of this is what CloudMinders calls “the warm 250.” The warm 250 is “a bunch of [leads] we’ve touched that weren’t ready yet. We keep in contact with them with our drip campaign. And we have a process set up with scheduled calls and emails on a timeline [that tells us] when to reach back out to people. That’s been working well,” he explains.
Davis’ biggest recommendation for other MSPs is not to take your foot off the gas. “Don’t stop doing sales,” he advises. “We had a good [sales] pipeline, and then COVID crushed it. It’s just so hard to get that momentum going again. You can’t stop, [just because] you’re doing well and you’ve got clients to onboard. You have to keep going.”
Looking Ahead
Moving forward, Davis aims for CloudMinders to reach $5M in revenue and increase their community contributions. “I would love to be able to grow to a size that we could return 10% of our revenue off the top to our community,” says Davis. “I also want to continue prioritizing my team. We already offer benefits like unlimited PTO, 401(k) matching, and full healthcare coverage, so as we grow, I’ll be able to do even more for them.”
For more MSP Success stories, read how this MSP’s soft skills led to hard profits.
