'Prepare for more acquisitions from inTEC Group', CEO Simon Howitt tells CRN

MSP boss talks lessons learned from past M&A deals and what he looks out for when assessing his next buy

'Prepare for more acquisitions from inTEC Group', CEO Simon Howitt tells CRN

Manchester-based MSP inTEC Group has more potential acquisitions lined up before the end of 2023.

The group's CEO Simon Howitt spoke to CRN following its recent buyout of Sweethaven Managed IT Services.

Marking its fourteenth acquisition since 2016, Howitt says inTEC plans to make more, possibly over the next few months.

"We've got another acquisition lined up for September/October. We've got two or three more in the earlier stages of discussions. If they were to mature, we would anticipate closing by the end of the year or the first quarter of next year," he reveals.

The chief exec opened up about what lessons he took home from inTEC's M&A history, which include patience and adopting the mindset of not buying for the sake of it.

Howitt also divulged what he feels inTEC needs from a deal in order for it to lead to an acquisition.

"We are looking to add to another geography. Our focus is SME and in education, so anything else in that mix we will look at.

"We like the fact that we positioned ourselves much more than just being an MSP, but being a wider technology communications group.

"We've got some presence in the telco market and we want to grow that capability because that's the capability we can take out all our customer base.

"We know what we need over the next two, three years and therefore those will be the opportunities we're looking at."

Keep reading to hear what inTEC's CEO thinks a successful acquisition needs and what market trends he tips for investment...

'Prepare for more acquisitions from inTEC Group', CEO Simon Howitt tells CRN

MSP boss talks lessons learned from past M&A deals and what he looks out for when assessing his next buy

Getting an acquisition right

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Despite his patient frame of mind, Howitt says the Sweethaven deal took less than a year to make it over the line after meeting its owners in September last year.

"But what I have worked out," he adds, "is the ones you spend a little bit more time with, say nine months plus, have proved to be our strongest and best acquisitions.

"Mainly because they've got time to get to know you, you've got time to get to know them, and they also have time to come to terms with the fact that they're selling the business they've built."

Howitt also believes keeping the soon-to-be-acquired business owners in the loop rather than them disappearing off into the sunset is central to executing a successful acquisition.

"That doesn't work because if you look at our business, most of the relationships with customers are about people. Therefore you can't have too much of a fundamental change going on.

"You've got to be able to say the reasons why we bought a business, the reasons why someone has sold and saw us as being ideal.

"If you're sitting in front of the customer trying to tell that story you've got to be able to share what are the benefits, what's the need for a customer.

"I've seen so many acquisitions fall because they're trying to get rolled into something else when it's too early. It doesn't make sense to me and customers are suspicious of that."

'Prepare for more acquisitions from inTEC Group', CEO Simon Howitt tells CRN

MSP boss talks lessons learned from past M&A deals and what he looks out for when assessing his next buy

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The MSP boss outlines what Sweethaven brought to the table to lead to an acquisition.

"One of Sweethaven's biggest strengths is that a growing proportion of its customer base is in education," Howitt says.

"About three years ago we acquired a business specialised in private education. The success Sweethaven has is in state education.

"And therefore we felt a real synergy of being able to have a wider presence and education market.

"What we saw with Sweethaven was the ability to build capabilities, allow the presence of another opportunity to add to our education proposition and give us a strong foothold in education. The plans that we've got for what the combined education proposition will deliver over the next two to three years is really exciting."

Highlighting his growth strategy, Howitt says there are a few critical trends in the market that come into play.

"If you were to look at what are the key things that seem to be happening in our marketplace, cybersecurity is one that is constantly going to be there.

"I think our market has started to wake up a little bit more to set fairly standard things which can be done to protect themselves better from cyber threats.

"Another area, we're predominantly a Microsoft house on the technology side, therefore, areas like the workplace have become massive. It's clear the benefits of what can come out of power apps or any of those other Microsoft technology areas."

Finally, Howitt tipped UC and collaboration as a key investment area as companies look to prepare for the 2025 switch off.

"More and more organisations, particularly in SME, are having to be equipped to be able to look at the 2025 to switch off and be able to embrace unified comms or hosted voice in a different way that they would have thought about doing three to five years."