Kaseya exec on how MSPs have adapted through the pandemic

clock • 7 min read
Kaseya exec on how MSPs have adapted through the pandemic

How have your MSP partners had to adapt over recent months?  

COVID-19 has completely turned people's lives upside down. Life has been disrupted in unprecedented ways and people are now having to adapt to a "new normal". 

According to the IT Glue Global MSP Benchmark follow-up survey in May 2020, around half (51%) of MSPs saw monthly revenue decreases as a result of the coronavirus shutdown. Additionally, more than a quarter (29%) saw their accounts receivable increase, indicating more clients could not meet contractual deadlines to pay for services. 

In terms of day to day operations, one of the biggest disruptions was an overnight move to remote working and MSPs played an essential role in enabling remote work for their customers, while at the same time going remote themselves.  

Many small businesses had to lean on their IT services harder than ever to remain productive during this crisis. Effectively, working from home means more work for MSPs. For some customers, it was simply a matter of increasing their VPN usage or requiring some new sets of credentials and access for particular employees and systems. For others, shifting work off-site was a massive, unexpected transition. For example, schools and universities have had to rely on remote learning at unprecedented levels they neither anticipated nor designed their systems for.  

For many, there was and continues to be a massive learning curve to moving to remote work which resulted in a flood of support inquiries. 

To better serve their new, varied needs, not to mention keep their own operations running as smoothly as possible, resources had to be redirected, and processes and protocols adjusted, so MSPs could remain nimble as the situation evolved.  

Has the pandemic changed the demands that customers have of their MSP partners?  

The biggest demands of customers on their MSP partners focused on the transition to remote working. MSPs played a vital role in helping their customers continue to keep their businesses afloat by making the shift nearly overnight. 

Even for companies that already embraced remote work with existing processes and systems in place, there remained a percentage of workers who hadn't taken advantage of the model before. They didn't have VPN clients on their laptops-if they had laptops at all. New credentials needed provisioning, new apps needed installing, and new hardware or virtual servers may have been required.  

Current systems are taxed to the max. MSPs must be vigilant with performance monitoring to minimise disruptions. They need to monitor usage rates for signs of potential overload. 

Customers already leveraging cloud computing and storage may need to increase their utilisation of these services, but others who have not leveraged them so much may find themselves forced to do so quickly. These organisations, in particular, will have a steep learning curve and rely that much more on their MSP to serve as a trusted advisor during this transition. Recommending appropriate services and onboarding employees is a key value-added benefit MSPs can offer.  

As the economic impact of social distancing and quarantining unfold, businesses may need to lay off or furlough employees. Those workers once had access to various internal systems and servers, and credential and access management must be handled appropriately. Departing users will need their access either turned off or restricted, depending on the situation. Yet, at the same time, some employees may have critical data and files kept locally or on personal cloud-based or server-based storage, to which clients will still need access. 

The other major demand on MSPs was around security and ensuring that their customers were protected from cybercrime.  With everyone relying on digital communications to shop, work and remain connected, it's inevitable that cybercrime will see a major boom during this time period. Hackers have been poking, prodding and testing every port and protocol they can find. Cybercriminals will take Dark Web shopping sprees for stolen or leaked personal information, credit card info and credentials to see what they can get away with. 

MSPs should proactively offer services to clients that can monitor and prevent some of these attacks. Internal systems access and traffic will now be highly irregular due to employees working from home or on split shifts to minimize transmission of the virus. The usual flags for irregular network activity and access will likely increase but will continue to require investigation. 

The lines between "home" and "office" will blur even further, so more personal internet usage on company-linked computers is inevitable. Scared and angst-ridden employees may also be less vigilant than usual. Phishing scams exploiting these fears may cause some workers to be more cavalier about clicking links in emails and social media while using their work devices. 

How has your business, as a supplier to MSPs, had to change?  

Like so many other organisations, we have been impacted by the pandemic. With our strong business continuity plan in place, we were able to quickly transition to a completely remote workforce within a couple of days and maintain the availability of our 24 x 7 customer support team. Despite these dramatic shifts, our teams continue to deliver new product innovations and closely collaborate with our customers to stay informed of their changing needs.  Additionally, we created our Kaseya Cares program to provide added support and resources to our customers during this difficult time.  

We launched Kaseya Cares in March to support our customers during the COVID-19 pandemic. As our CEO Fred Voccola said, "Our customers have empowered us to build an amazing company over the last 20 years. It's our turn to give back."  

  1. Kaseya Cares is a three-part, multi-million- dollar program that is free to our customers. It consists of:  
  1. GOVERNMENT RELIEF NAVIGATION: We brought the full weight of our legal, financial and technological expertise to ensure our customers get all the information they need to take advantage of government relief programs.  
  2. BUSINESS GUIDANCE: We expanded our Powered Services program, which provides essential sales and marketing assistance. Combined with the expertise of Gary Pica of TruMethods, our customers can receive coaching and consulting specifically designed to help them acquire, retain, and service customers effectively in this challenging business environment.  
  3. DIRECT FINANCIAL ASSISTANCE: We are investing millions of dollars into custom programs to help our customers stabilise and even grow their business by ensuring they have both the tools and the capital they need to survive and thrive. Once registered, our dedicated COVID-19 Response Team prioritises requests and arranges calls to walk our customers through the options that make the most sense for their business needs.  

Has the coronavirus accelerated trends in the MSP space, or changed them?  

We believe that the coronavirus has accelerated trends in the MSP space in particular in the area of security.  

Respondents to this year's Kaseya MSP Benchmark Survey overwhelmingly agreed that their clients need more cybersecurity support from them. This is especially true in today's uncertain environment. As more small and midsize businesses look to maintain vital security operations and decrease IT costs internally ahead of an economic downturn, they will lean on the expertise and services provided by MSPs to keep their companies operating. 

Our survey showed that more than half, or 60 percent, of our respondents said their clients experienced downtime from an outage in the past year. In our current climate, an outage can mean the end for a small business. So for MSPs, who are the IT backbone of these small businesses, there's a significant opportunity to diversify their clients' cybersecurity solutions and strategy in order to respond agilely to any threat that comes their way and maintain their livelihood. 

What do you envisage the long-term impact being?  

Both Kaseya and  IT Glue (a Kaseya company) conducted surveys among the global MSP community  before and after the pandemic. So, we got a pulse on pre and post-COVID MSP sentiments. The surveys can be reviewed at these links. 

https://www.kaseya.com/resource/2020-msp-benchmark-survey-emea-edition/ 

https://www.itglue.com/resource/global-benchmark-2020/ 

In general, the MSP industry has been growing. This growth was largely fuelled by small and midsize businesses whose IT needs surpassed their in-house expertise and capacity. There were more systems, more endpoints, and increased security threats to worry about as increasing numbers of everyday functions depended on technology. Much of that isn't going to change because of this pandemic. Businesses won't revert to the old ways of doing business.  Privacy and security regulations won't be rolled back, and cybercrime volume will unfortunately continue its upward trend. 

Many businesses will become even more reliant on technology services. Their switch to online ordering, telehealth, remote work, and other solutions to facilitate social distancing and comply with public health guidelines won't disappear when a vaccine is available. 

It's hard to predict what the new landscape will look like. There will inevitably be fewer clients still standing when this is over, but those that make it through will use more MSP services than ever. 

A couple of other pointers: 

Although MSP interest in mergers and acquisitions had already been declining before 2020, the pandemic marked the most profound shift in M&A sentiment in recent years with a much smaller number of MSPs indicating that they were interested in acquiring or merging with another MSP. Though M&As are likely to slow down as a result of the pandemic, market consolidation will continue - however, the pace of which remains to be seen. 

In 2020, MSPs that focused on a specific industry experienced slightly higher revenue than more general MSPs (79% vs. 75%). However, while specialisation can be an advantage for MSPs, be weary of placing all your eggs into one basket. MSPs that specialized in retail and hospitality were especially hard hit during the pandemic. 

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