MSP ponders acquisition as it approaches £20m revenue

Infrastructure MSP Pinacl is pondering its first acquisition as it nears the £20m revenue mark.

The Welsh firm's bosses secured an MBO in 2015, taking it off the hands of its previous private equity owners, and announced plans to turn it into a £20m firm in five years.

Updating CRN on the progress, Pinacl managing director Rob Bardwell said the MSP is on track to beat its target and is now considering the possibility of making its first acquisition.

"We did say that in year three [of ownership] we'd look at acquisitions and we have now been looking," he said. "I'm long in the tooth and I know that acquisitions can be very distracting for businesses, so they need to be really complementary to what we do.

"The obvious areas are anywhere where we're using a lot of sub-contractors. Compute is an area where we might need to accelerate faster than we can for normal growth.

"It's not from a customer acquisition piece; the acquisition would be there really to bolster our engineering capabilities. We'll take the added revenue and customers, but the primary focus is to give us the capabilities within our own business group."

While typically an infrastructure reseller, Bardwell explained that the MSP has recently taken its first steps into compute, seeing particular success through storage both on-premise and in the cloud.

Pinacl filed its accounts for the year ending 31 March last month, with revenue up 24 per cent year on year to £15.5m, while operating profit was up 18 per cent to £385,471.

Bardwell explained that the MSP's progress will likely see it hit its five-year revenue target early.

"At the end of the five years we said we wanted to be £20m-plus revenue and at £1m bottom-line profit, but I think we might get there next year or even this year," he said.

"The backbone of that is long-term customer relationships, so we're not just building revenue, we're looking for recurring revenue to be around that 70 per cent.

"In year four we'll probably look to define another five-year plan in terms of growth."

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• Topics
• Reseller
• Pinacl