From his roots in a family-owned business, Bruce Gibbs launched his own family business in St. Louis, Missouri, in 1999. Leveraging his proven sales savvy, he quickly grew that business, GFI Digital, to $1 million in revenue in its first year. Originally a copier dealer, GFI Digital added an MSP line of business about 10 years ago. Today, the company has grown to 350 employees and $140 million in revenue. In this interview with TMT and MSP Success founder Robin Robins, he shares lessons on sales (and the beauty of old-school sales tactics), developing leadership, and scaling for long-term growth.
Note: This interview below has been edited for clarity and length. For the full conversation, watch the video above.
Robin Robins: How did you get started in the MSP business?
Bruce Gibbs: We would be installing a copy machine, and they would ask if our guys could fix their router. So we thought we ought to get into this and hired a couple of guys that were very IT savvy. And now we’re sitting here with 110 IT employees and growing the business. It’s on track to be well over $40 million dollars this year with a great bottom line. We’ve been through a lot of challenges and learned a tremendous amount. We continually look at it as an opportunity to scale. I think in five years’ time, the MSP business will be as large as the copier business, if not larger.
Robin: Talk about that transition. What was your strategy? Was it cross sell? And if it was, how did that process go? What did you learn?
Gibbs: At the beginning it was cross sales. We learned that the IT business is not the copier business, and we did not promote copier technicians to IT engineers. You have to hire IT-savvy engineers. We think that a lot of our success has come from that.
We have a career path from our print IT call center. If they show expertise and take the training, they could move into what we call the call center on the IT side and that’s the only career path that we have. But we don’t promote the copier sales reps to IT sales reps. We have synergy; what’s made us successful is the synergy between everyone talking about our MSP business. The leads following in from the copier side are overwhelming. Our growth this year is 24% on the MSP side. It’ll be a lot larger in the last half of the year, but you can’t outgrow your infrastructure. We made the mistake at the beginning [of] growing really fast and burning people out. We can sell more than we can support, and we have to be very careful making sure that we have the skill set to support the customers that we’re taking on.
Robins: So would you say that businesses transitioning from a VAR model or hardware sales need to hire rather than incentivize their current sales reps to sell managed services?
Gibbs: Yeah, but the sales cycle’s much longer. If you’re hiring someone that came from corporate America and IT, they don’t understand that this [MSP industry has] a very big variety of technologies, and you also have to have the skill set that you’re willing to talk to people on the phone on a regular basis and a lot of different personalities. You’re going to be talking to an architect. You’re going to be talking to a banker. So getting that skill set and that mindset—that was our biggest challenge getting started.
Robins: How did you find and develop great talent?
Gibbs: You’ve got to have a quality pay comp program and availability for training. Our biggest weakness, until really recently in the last year, is good managers in the IT space. We were so focused on what the individual’s talent was, so we were promoting guys into leadership roles [who] were engineers. And we couldn’t get that group of people to really be leaders and to be managers of people that could share the vision, share the culture, and understand the customers’ complaints as well as the employees’ satisfaction. So focusing in on a true leader and a manager first, and paying the right manager and the right person to lead your operation. Finding that right person [who is] a true mentor is a really big deal, and we struggled with that for a long time. Now we’re in a really good position. We’ve both hired and developed leaders.
Robins: What’s your favorite book, or course on leadership that you run your org with?
Gibbs: The Advantage by Patrick Lencioni. We follow it. So when I worked, my mentors were all about open book management—weekly meetings, quarterly meetings, and sharing what’s going on.
Robins: I want to go back to when you implied you have a sales problem. It’s more of a fulfillment problem, selling faster than you were able to effectively onboard and support customers the way you want to. So you obviously have sales in your DNA. What advice do you have for MSPs who are struggling to get sales?
Gibbs: Two words: cold call. We have 60 copier reps on the street every day cold calling. We still train. I trained eight new sales reps yesterday on what it means to get in and set an appointment and then build a relationship. Our IT sales reps have the best job ever, because they don’t have to cold call, because we have 60 people cold calling. Now they’ll work with them, those synergies, but everybody wins when we sell MSP. We have a comp program for our IT salesforce on the MSP. And then the copier sales rep gets the first month of the billing. So let’s say it’s $2,500. They get $2,500, and then they get half of that the next year. And so they’re motivated to go out and get those deals and build that relationship. When we started 10 years ago, we probably had 10,000 customers; now we’re above 18,000 customers. But believe it or not, 35% of our MSP contracts are not copier customers. So on a cold call, the customer’s like, “I don’t really care about copy machines, but I really am interested in your IT services.” Then they bring in the IT person. It really is just making sales calls.
If you don’t have a sales force, in the event that you have a down day, grab a bunch of business cards and start walking into accounting firms, law firms, banks. Once you get in and find out what’s going on, the follow-up call is a lot easier after the cold call.
Robins: If an MSP wants to hire an outside sales rep, what should they look for?
Gibbs: Right now we don’t hire very many experienced sales reps into our culture because they don’t like cold calling, so we like to find a young, aggressive person that wants to be taught sales. If I was starting up an MSP right now, I would hire a focused, good person that could run a sales team and then say, “You develop enough business, then we’ll add another rep, and you go and get more business, and then we’ll add another rep.” Before you know it you could have three or four sales reps, bringing in more business than you can possibly support. That’s how we did it.
Our challenge has been our desk can’t keep up. We got off focus from what our business is, and that’s a successful desk closing 95-97% of the tickets. If we overwork our desk, our customer satisfaction goes down. And then we’re dealing with all those problems. So we’ve been staying ahead of the hiring. Every manager is responsible for staying at 100% of their manpower. So we’re right now three people over manpower.
Robins: Why are you transitioning your stack to Kaseya?
Gibbs: We’re feeling very confident about Kaseya for our future. I just think that Kaseya skinned the cat where they have all of the technology under one company. We’re looking forward to that new technology and more intelligence with their Cooper intelligence.
The other thing, I was never part of a peer group. So when I was at Kaseya Connect, I heard Gary [Pica] say “community” [too many times to count]. So I’m going through the onboarding process of being part of the [Kaseya TruMethods] TruPeer group.
We have not fired an MSP customer, and after being part of TruPeer conversations, I sent the partners in a law firm an email [saying] I can’t support you the way you want to be supported. And on Monday I got stopped by three engineers thanking me for having their back.
Robins: What about marketing? Is there anything in marketing that has really helped you grow the business?
Gibbs: We have a good marketing department. We don’t do email campaigns. [GFI does] a lot of charity golf events. We have great site sellers. We have good leave behinds. You can look on social media. We’ve done really well on referrals. But again, we just make a lot of sales calls.
Robins: Where do you see the MSP industry going in 5-10 years, and what are you doing right now to stay ahead?
Gibbs: I believe it’s just going to get bigger. Every quarter we’re getting a $15,000 or a $20,000 MSP contract. There is big opportunity out there in large accounts, whether they’re just using your desk or they’re just using backup. There are all kinds of different strategic ways to get larger deals. But I don’t want to lose sight of the small law firm that wants to pay $2,500 because we can make them happy as a customer and still do the benchmarking that I’m learning from TruMethods. But I think in five years it’s just going to get larger, and with the sophistication that Kaseya is coming to us on the desk, we can earn the respect of major corporations.
Robins: Tell me about your vision for GFI Digital. Who is going to continue the legacy over the next 10-20 years?
Gibbs: My daughter, and a group of young [professionals] that are all eager. We’ve got a really good succession plan being put in place. So I’m looking forward to transitioning. I’m turning 60. I have a junior in high school, so I’m in no hurry to call it quits. I have as much fun at work as I do when I’m hunting, fishing, skiing, swimming, whatever I do. So we have a really good quality of life here for all our employees. We’ve been one of the best places to work in St. Louis for eight years running.
It’s all about having the right leadership and taking care of employees. My father always said the copier business is the people business. Well, I think every business is the people business, and we really are pushing that culture downstream and making sure people understand where we need to go. There’s always going to be turnover, and you can’t worry about that. But if you find the right skill set and the person who believes in your vision, this business is going to be huge for everybody.
If you missed our last Titans of Scale interview, see From College Dropout to MSP Powerhouse: Peter Melby’s Trials, Triumphs, and Lessons in Leadership
