Now That's IT: Stories of MSP Success
Now that's IT: Stories of MSP Success dives into the journeys of some of the trailblazers in the Managed Service Provider industry to find out how they used their passion for technology to help turn Managed Services into the thriving sector it is today.
Every episode is packed with the valuable insights, practical strategies, and inspiring anecdotes that lead our guests to the transformative moment when they knew, Now, That's IT.
This podcast provides educational information about issues that may be relevant to information technology service providers.
Nothing in the podcast should be construed as any recommendation or endorsement by N-able, or as legal or any other advice.
The views expressed by guests are their own and their appearance on the podcast does not imply an endorsement of them or any entity they represent.
Views and opinions expressed by N-able employees are those of the employees and do not necessarily reflect the view of N-able or its officers and directors.
The podcast may also contain forward-looking statements regarding future product plans, functionality, or development efforts that should not be interpreted as a commitment from N-able related to any deliverables or timeframe.
All content is based on information available at the time of recording, and N-able has no obligation to update any forward-looking statements.
Now That's IT: Stories of MSP Success
Betting on Yourself: Sales-led Growth with Doug Alexander
Doug Alexander's story is nothing short of remarkable, showcasing his transition from the sales battlefield to the c-suite to the boardroom. With riveting tales from his EMC sales days and insights into his aggressive methodology, Doug's narrative is a treasure trove for anyone looking to inject entrepreneurial vigor and a competitive edge into their career.
Join us as we peel back the curtain on how to morph a complacent lifestyle business into a growth juggernaut. Doug shares his playbook on instilling a sales-driven ethos, making strategic hires, and realigning company values for scalability. His hands-on leadership tactics and his knack for placing 'A players' in key positions have not just propelled Focus Technology's growth but have left a lasting blueprint for sales success and corporate expansion.
Lastly, we tackle the common myths surrounding sales teams in tech and MSP industries. Doug debunks the notion that such teams are superfluous and underscores their role in amplifying business growth. In a candid reflection on Focus's strategic elevation to national recognition, without succumbing to a sell-out, Doug imparts wisdom on the resilience needed to shift company cultures and the gratification that comes from proving doubters wrong. For anyone standing at the entrepreneurial starting line, Doug's journey is an inspiring affirmation that the first step isn't as daunting as it seems, and what lies beyond is worth the leap.
Hosted by industry veterans, this podcast delves deep into the findings of the MSP Horizons Report, providing actionable insights to transform your IT business. Each episode features in-depth discussions with experts, thought leaders, and successful MSPs who share their experiences and strategies for navigating the ever-evolving landscape of managed services. Listen & Subscribe Wherever You Get Your Podcasts.
'Now that's it: Stories of MSP Success,' dives into the journeys of some of the trailblazers in our industry to find out how they used their passion for technology to help turn Managed Services into the thriving sector it is today.
Every episode is packed with the valuable insights, practical strategies, and inspiring anecdotes that lead our guests to the transformative moment when they knew….. Now, that's it.
This podcast provides educational information about issues that may be relevant to information technology service providers.
Nothing in the podcast should be construed as any recommendation or endorsement by N-able, or as legal or any other advice.
The views expressed by guests are their own and their appearance on the podcast does not imply an endorsement of them or any entity they represent.
Views and opinions expressed by N-able employees are those of the employees and do not necessarily reflect the view of N-able or its officers and directors.
The podcast may also contain forward-looking statements regarding future product plans, functionality, or development efforts that should not be interpreted as a commitment from N-able related to any deliverables or timeframe.
All content is based on information available at the time of recording, and N-able has no obligation to update any forward-looking statements.
One, two, three go. And that's when he looked at me and said I'm going to make you the CEO and go do what you got to do. And I was a little like you know, I'm not a CEO, I'm a salesperson. I don't have any finance background or any advanced MBA degrees or anything he's like you'll be great. So at that point I kind of said to the company look, we haven't grown much in five years. We are now a sales-driven organization.
Speaker 2:Welcome to Now that's it Stories of MSP Success, where we dive into the journeys of some of the trailblazers in our industry to find out how they used their passion for technology to help turn managed services into the thriving sector it is today.
Speaker 3:Doug Alexander, current board member, former CEO, majority owner of Focus Technology, new England's preferred partner for managed service technology services in Boston, massachusetts. Welcome to the Now that's it podcast, doug. So, as the saying goes, once a salesperson, always a salesperson. Does that describe you, doug? I'd say for sure.
Speaker 1:I started out in 1995 as an inside sales rep, smiling and dialing, trying to get appointments for outside salespeople, really out of lack of direction, honestly Thought I wanted to be a lawyer, went to work for a law firm and quickly realized that's not what I wanted to do. Got a break and got hired into a startup company that was a reseller of data storage and made their own NFS file server. I worked there for probably three weeks, maybe a month, and still had no idea what the company did. But learned a lot and the career went on from there, that's great.
Speaker 3:What is it about sales that really drives you, Doug?
Speaker 1:You know you really got to love to compete and love to win. For me it was. You know, obviously the the compensation is there, but it's only as good as you are, um, and you get paid paid on performance. So a lot of betting on yourself, believing in yourself, um, commitment, hard work, and then the community and the people you're around, um, we can get into it. But you know, I spent a lot of time with a lot of great people on the oem manufacturing side before I got to Focus, made some great relationships, the customers were just awesome and it was a fun job Very hard, very, very hard, but very, very fun and rewarding, and loved getting paid on performance. You know you're betting on yourself, your teammates, and you're out there competing and winning. You know I played sports my whole life growing up. I just loved competing and it was kind of a natural fit.
Speaker 3:We've had this conversation. I think it takes a special person to be a salesperson, definitely a successful salesperson. You know you can have a great personality, strike up conversation, but to your point, like you said, you've got to be able to bet on yourself because if you don't succeed, you're going to not do well right, you're going to be poor. So you really got to be able to make that bet to say I'm confident I can hit my number and exceed it, and you got to be pretty, almost entrepreneurial right as a salesperson.
Speaker 1:I mean you're kind of running your own business, sort of You've got a lot of support from the company that you work with and work for and the people around you, but many nights driving home you're wondering what am I doing right? And then it is really highs and lows, so you miss your number, you have a bad month, you're just scratching your head why am I doing this? And then the next day you wake up and you get an order and you're like this is the greatest job ever. So very much much a roller coaster, but but lots of fun. And then you could really put a lot into it and get a lot out of it. You know, driving yourself to just be better, yeah, so yeah, that was it was. It's great.
Speaker 3:We'll talk more about it Not only a great salesperson, but I think you're a great leader and I think what you've built around you to sort of you know, follow in your footsteps, is pretty powerful.
Speaker 1:One thing you know, someone once said this to me. It really stuck with me. Yeah, when I was in the beginning of my sales career they said you know, you're not really in sales until you have an existing customer base that buys something from you every quarter, quarter in and quarter out. You've got great relationships and you don't ever have a lull. And there's a lot of sales roles out there that are called sales roles.
Speaker 1:You know, when you're trying to develop relationships and do business development stuff and get meetings, but until you as a salesperson, until you're you have a sales territory, a quota that you're hitting on a regular basis. A customer following that relies on you to help them and team members around you that are helping you. You know I sold technology my whole life but I'm not a technologist, don't have an engineering degree, but I was surrounded by great people. But that really stuck with me and I could tell like when I hit that I'm like all right, I'm in sales now. So I think there's a lot of folks that give up on it a little too early and they say I tried sales but they never really were in sales because they never got to that point.
Speaker 3:That's great. So you were in sales early on, but early 2000s you get a job at the EMC Corporation where you had a chance to learn sales the EMC way yeah.
Speaker 1:You talk a little bit about what that was like. You know I got there late so I competed with EMC for a good chunk of my career. You know the nineties were an incredible time for EMC. I think their stock split six times during the nineties. I grew up in Boston, so you obviously headquartered in Hopkinton. I was right in their backyard.
Speaker 1:I worked for a company called Storage Tech that was reselling Clarion from digital equipment and we were competing with EMC. We lost way more than we won, but when we won it was great. I'll never forget this. I just closed a really big deal with a big company in Boston and we unseated EMC. We were swapping them out and it was maybe two or three days later and I'm driving to work and I hear on the radio that EMC just bought the Clarion. Basically this is what we sold and I just closed the deal like three days ago. So the CIO calls me up. He's like hey, doug, I'm sure you heard the bad news. Emc just bought your product. What are we going to do about this? I want to go back to EMC and I actually had to call the EMC team that I was competing against and I'm like I need help. What are we going to do here? And that's when I'm like all right, I need to go work for EMC, because this is not going to get any better.
Speaker 3:That's great. So when you were working at EMC, did that help you break sort of any of those maybe bad sales habits that were sort of self-taught early on, or was it just a different process, a different method for selling?
Speaker 1:There was a definite higher level of accountability. It was a great cult. I want to say a great culture. Yeah, of course it had its bad moments, but I learned so much there. The people there were just the best in the business and we won a lot of deals that technology wise we probably shouldn't have won, and certainly price wise.
Speaker 1:But customers and this was, this was just an EMC thing they took such good care of their customers. And you know, emc used to tell us you put the customer first, always the company second and yourself last, and if you do that and do it right, your stuff is going to be fine and well taken care of. And you first heard that and you're, like myself, last. I don't know about that. But then once you bought in, it just worked. So EMC took very, very good care of its customers, its employees.
Speaker 1:I was surrounded by just the best sales leaders in the business and I just soaked it all in. I learned as much as I could. They drove you very hard. You know we used to say we lived our days in 90 day cycles. You had to hit that quarterly number. A lot of reporting, a lot of tracking, a lot of metrics, a lot of accountability. They used to say don't win alone, don't lose alone, so you bring in a lot of resources. They had tons of resources to help you sell. I had some some great mentors and some some great managers there that I learned a ton from. When it was a great it was, it was awesome. I'd like to call it the gladiator training ground of sales. It was just a. We're not going to lose. They used to say you know, 100% of market share is our fair share and we went at it hard and it was a great place.
Speaker 3:I've heard some of the big tech giants like EMC and Cisco there's a bunch of them out there that again sales was. They had built this training ground, as you mentioned, to really get these, your sales reps, up to speed and producing very quickly, and so those that had sort of gone through one of those, those different tech giants, they come out going yeah, I know things that others don't. I can look, I can read a room better, I can forecast better. I can. I, you know I can hit my number and tell you I'm going to hit my number because I'm so confident.
Speaker 1:The reading of the deals was so you didn't really know what was happening to you, but forecasting and being able to predict, and we had a methodology that we followed. And if there was 10 points on the methodology and you missed step four and five, you could tell and you're like why is this deal stalled? Why are they not moving forward? And you'd go back to that methodology and you'd see it right there in front of you. But it was hard at first to kind of grasp that, because you're looking at a piece of paper and you like 10 steps, like you know the customer's going to do what they're going to do. You know, but well, I didn't get to the right person. I'm selling in the back of the building. Um, well, the front of the building instead of the back of the building. I don't have the right people at the table. You know I'm not bringing in the right resources, I'm not telling the right reason to partner with EMC. You know we used to say if you're talking speeds and feeds, you're losing.
Speaker 1:Emc brought a lot to the table from not only a technology standpoint but a relationship standpoint. To me they were always out in front of the technology when cloud started coming around. Our message was we're going to take you on the journey to the cloud. We had no cloud offering, you know, but we're in front of customers talking about why this is going to be so important for you, and I think customers went with us because of the vision that EMC had and we were always kind of out in front of it. That's great Not the perfect place for you and I think customers went with us because of the vision that EMC had, and then we were always kind of out in front of it. That's great, not the perfect place, you know, there was a lot of craziness going on but the people made it in the culture of just.
Speaker 1:You know we will win and we will take very good care of our customers. I saw, you know, solutions that customers spent millions of dollars on go into the data center and, for whatever reason, just not work. And you know EMC was right there. They'd swap it out, they'd ship in the new stuff, they'd add capacity. They do whatever it takes, you know, regardless of whether there was a PO or not, very fast moving to fix problems. That was a big lesson I learned as well. I used to go into our quarterly business reviews and you know the bosses would come in and they'd say you know, we're going to go through your problems that you're having in your district, but if I come back here for next quarter's QBR and they're the same problems, we're going to have a big problem. So fixing things fast, taking care of things quickly, moving very quickly, was a big competitive advantage for us. That's great.
Speaker 3:You had a really good run there. You were there for over a decade 10 years, yeah and then, as many of my friends that went through EMC, they love their time there, but at some point it's time for the next phase of your, your, your life. Yeah, what was that for you? What were you looking for? Was there an opportunity that came by that said it's time to leave the mothership there?
Speaker 1:Yeah. So a lot of our business at the time went through channel partners. So I was basically selling in New England upstate New York a little bit. I managed a district. I was an area manager for their backup solutions unit for a while, so everything went through the channel. So I got to know the owners of these local channel partners pretty well and they were doing really well and being very successful and I always just rattled around the back of my head that I could probably do that and I have always had this entrepreneurial itch. I felt like I had done all the studying and it was time to take the test. So Focus Technologies was a small, really VAR in New Hampshire, of all places, and started in 1997 by Bruce Crochetteer Great, great guy and he was on me for a number of years tapping me on the shoulder and said why don't you come over here and help me grow the company? And I was just having a lot of success at EMC. I love the people I was working with and I said no many times.
Speaker 1:And then in 2015, the rumblings of the Dell acquisition were brewing. I think they closed that deal or announced it in October of 2015. Kind of saw that I'm like if I'm ever going to take the test. Now's the time Our group that we had was starting to split up. My boss went to ServiceNow and who I loved Tom Hannigan, if you're out there, he was just the best. He now runs all the sales for the Americas for ServiceNow. He left, some other people left and we started to kind of break up our group and we knew the Dell thing was coming and this was a good opportunity to kind of really test myself and take on a new challenge to go run sales for Focus.
Speaker 3:That's great, so you come on board at Focus, and it is very much a VAR business though. I think you said 98% hardware sales, 2% sort of services or whatever. Yes, so what? Yeah, talk about Focus at the time. I mean, what was the business like and and what did you see? Obviously, you knew you could sell hardware. You had done it for years. So that that's the easy button there. But what was sort of your early hope that you could help from building the business?
Speaker 1:Yeah. So there was a lot of things in place. So I had a good customer network. I had a great network of talent that I could pull from and try to recruit in Focus, had 300 customers, no debt and was just a solid kind of foundation to get this started. I'm not knocking lifestyle businesses. There's plenty of great lifestyle businesses out there. It was a lifestyle business and by that I mean, you know, people were just comfortable with little to no growth but still doing well, people earning the income they wanted to earn, having the lifestyle they wanted to have. But the owner wanted more and he hired me to to turn it from a lifestyle business to a growth oriented business. And so he initially hired me as the VP of sales and, to his credit, you know, he he kind of said to me I'm too close to the employees, I can't change the culture 's. I think just moving this thing's going to be too hard. I need to hire someone to do that for me. So I got in the seat as a VPS. Sales started looking around, I'm like this is really a lifestyle business. Yeah, again, nothing wrong with lifestyle businesses. But I, you know, after a while I went to Bruce and look, how bad? Do you really want to grow Focus? And he said really bad. And I said, okay, well, what got us here isn't going to get us to the next step. We have to go through a full transformation, cultural transformation. We had to change everything we're doing and people are not going to be happy about it. And the lifestyle people again not knocking the lifestyle people, but they're either going to check out or maybe not transform. But here's what we need to do. And that's when he looked at me and said I'm going to make you the CEO and go do what you got to do. And I was a little like you know, I'm not a CEO, I'm a salesperson. I don't have any finance background or any advanced MBA degrees or anything. He's like you'll be, you'll be great. So he got out of the way, let me do my thing. And we invested in growth. So at that point I kind of said to the company look, we haven't grown much in five years. I'm not a lifestyle person Like I've never just been in that environment. So everything has always been do better, do better, do better. You know, hit your number, okay, go, exceed your number. And that's just the way I've always looked at the world. So started looking around the company and knew that we had to make changes. But we couldn't break things either, right? So it couldn't come in and just blow everything up.
Speaker 3:Yeah.
Speaker 1:So, as I'm kind of taking the company through that change, I was very sales driven. I'm like look, we are now a sales driven organization. Nothing happens until something gets sold. We had great engineers, great support, but we needed people that could really take us up market. That was the big thing. So we were selling to SMBs and we still do, and it's still a good business. But we got to go find bigger accounts that have bigger challenges, have bigger budget that we can add more value in and that's what we're going to go do.
Speaker 1:So I started to hire in growth oriented people that had done it before and kind of I had kind of a following of people that wanted to kind of do this. So I hired a bunch of people across the board. So we hired new salespeople. I hired a marketing people focus. Again, it was really on cruise control. There was no marketing, there was no like advanced forecasting, pnl management, there was not a lot of strategy and it was just kind of on cruise control, yeah. So you know, here I am walking, walking around the company saying we're gonna grow, and I know there were the people that were just like, yeah, I'm out of, out of here, I'm not going to I don't want to hang around for this and that was fine, you know. And they went on and did their thing, but I hired. I hired our CFO, chris Caprio, who's now our CEO I'll get into that and that was a big turning point for us.
Speaker 1:We brought a lot more planning and strategic planning. You know, when I first sat in the seat, emc always had the strategy and they just jammed it down your throat and they're like go execute. And we were just an execution machine. So I'm sitting there and I'm like where's the strategy? And I'm like, oh, I got to come up with that. So, and I relied on, you know, my training from EMC to go do that. And then the people that I hired in.
Speaker 1:So we hired a CTO, a chief strategy officer, a marketing person, a bunch of new sales reps, a bunch of new engineers, and I wrote down our company values, our mission, and I put them on a spreadsheet and I said everyone that we hire has to have these cultural traits. And you could see it, when we made a hire that didn't match our values, they didn't work out and that worked. So we hired a bunch of just great people and we got after it and it was just look, you know, eight to 10 sales calls a week per per rep we're going to. No one had goals. It was just, you know, if, if they made enough money to to support their income, they were fine. And we're like no, we're going to have quotas, we're going to track metrics where we're going to really get after it and take very, very good care of our customers. And I had a lot of people that thought I was crazy and they're like this is never going to work.
Speaker 1:You're never going to do this.
Speaker 1:They're betting against you, huh. Yeah, I felt like there were some folks that were just kind of waiting me out and just kind of from the owner's perspective, oh, he'll get sick of Doug at some point. This will just be another phase of focus, but this it was real this time and we had a lot of success. So, but but part of what you said we were 98% bar, very little services. We had a little bit of MSP, but it was losing customers and losing money fast and no one was really looking at that, you know. So we had success on the bar side. That helped us have the capital to go invest in the growth side. And we looked at the MSP piece and you know I like to have a knack for stating the obvious, but we looked at it and we're like, no, this is, this is good business.
Speaker 3:Right and yeah.
Speaker 1:And we started to put a strategy together to to grow the MSP business. And we got to work on that. And I don't I didn't come from the MSP world, but I knew like this is real, this is. I don't want to ever say selling anything is easy, but this is easier than selling $8 million of Symmetrix into a data center. You can get to the decision makers quicker. They really have a need. You can bring a lot of value. So we started putting effort into that and our goal was to get to 50, 50 in a short amount of time services to MSP. And we just we just tracked it like maniacs, like I had it on my whiteboard and I'm like, okay, we're at, you know, 98, two. Now we're at 80, 20, now we're at 70, 30. And we just kept moving that needle. And then the customers saw our focus there, no pun intended and they're like these guys are serious about delivering a good MSP product. And then everyone inside the company you know most of them, hardware sales folks showed them how to how to sell MSP and why it was valuable, started partnering in that area and it took off. It went great.
Speaker 1:And that's when Chris Caprio, our CFO, came to me and said you know, we should make an acquisition and we weren't a rich company. We had an owner that didn't have access to capital, right, so we weren't backed by private equity or anything. But Chris is like I think we can make a pretty good MSP acquisition. So we did. We found a company in Boston called NSK. We acquired them in 2018.
Speaker 1:We only could afford what we could afford, but we took on some, some debt and this was a gutsy move, again by the owner, right.
Speaker 1:So the owner you know, personally guaranteed the debt, really believed in us. Now he saw the performance, right, he saw the transformation happening, he saw the growth taking place and, to his credit, like he really believed in us and we said we want to go buy this company and you need to personally guarantee the loan for it. And he he just stepped right up, signed the documents and so we integrated them. It went extremely well. You know, we went from 800K of annual recurring revenue to 15 million in five years and that acquisition was a big turning point for us and a lot of the people that were part of that acquisition are still at focus. They've grown their careers. We've grown our customer base, our MRR, really just kind of applying those EMC sales principles to the MSP business, not forgetting about the VAR stuff and the data infrastructure stuff and the cloud stuff, if you will still doing well in that area. But this drove the enterprise value of Focus in a big way.
Speaker 3:Wow, there's so much there, so much good stuff there. Doug, let me ask you today what's the revenue mix VAR to MSP business?
Speaker 1:Yeah, so it's close to 50-50. It's not quite there, but it's almost there. And the margins have gone up dramatically as well Because as we were investing, we're hiring people that could deliver, we're tweaking the MSP offering. So that took some investment but we had an earn out on the acquisition that we did. We hit all those earn out numbers. You know Chris reminds me he's like. You know, we got spoiled with that acquisition because we found them relatively easily negotiated a good deal, closed it relatively quickly, integrated it really well, kept all the employees, kept all the customers, increased the margins. And you know Chris had done about 12 acquisitions before that and he said these things usually don't go like this. They don't. But I think that was good execution and good strategy on our part and putting that customer first.
Speaker 1:We, we, we started to really look at what we called bad MRR and we had some customers that were sucking a lot of our time, not paying a lot per month. We were giving away services on a lot of cases and there's some finesse there. You know you don't want to turn your back on your customer. You need to take care of your customer. But as we went up market our, our monthly contracts got a lot bigger and we had a level of fearlessness Like I, you know there was.
Speaker 1:Sometimes people were like we can't take on that customer. I'm like, no, absolutely we can, we'll hire to it, we'll plan it correctly. And we are. We are chasing big contracts now and that's just the way it's going to be. So that's great. We re, we redid all of our contracts. You know we were. We had a lot of month to month customers. We went to three-year contracts. We raised pricing but we delivered a better service that the customers were willing to pay for and we were winning a lot of business away from MSPs that weren't doing some of that stuff.
Speaker 3:Was that? Was that the first acquisition focus had ever done? Yes, yeah, so so you, you might, you might be right there. There might've been a little bit of luck, perfect situation at the perfect time. But I also wonder, you know, when you came on board even though that wasn't an M&A, I mean the integration of you bringing this different culture, everybody sort of had to go through that. So I think, that integration, I'm wondering if that integration of you coming on board and sort of changing the culture helped you bringing a different team in as well.
Speaker 1:I think so. You know this is going to sound weird, but I spent a lot of time staring at our org chart and just moving the chess pieces around on the board and because I'm really big on it's, it's, it's all the people. Do you have the right people on board? Are you know, are they in the right seats, doing the right stuff? And after we acquired nsk, I saw some people there that were kind of in the corner doing their thing and I'm like that person has a lot of talent and it's not being tapped. So you just you move some pieces, create some new boxes. It matches up with the go-to-market strategy and then boom, you know, they start to flourish.
Speaker 1:It was a lot of work, don't get me wrong, and EMC was always big on development, retaining your employees and developing your, your employees.
Speaker 1:So I had a big development strategy too at Focus, like we need to develop our people and spend time on bringing these people along, and we grew so fast. On the MSP side I had to put some people into leadership roles that probably weren't ready. But talking with our management team, I'm like we'll do this, we'll figure this out, we'll bring them along the right way, because we know how to do it. I put a really strong management team in place around me and that made all the difference. And I was telling some of the managers I'm like you're only as good as your team and you should have all A players, no matter what. Like, don't settle for C players, and there's a way to do it correctly without breaking things. And maybe some of these folks we weren't. We weren't on this like firing spree, but we were redeploying people into different roles that they were going to like better and be better at promoting people that were chomping at the bit to get promoted, and it absolutely took off.
Speaker 3:Yeah, when you write your book I know one of the chapters is going to be you know, don't settle for C players. You know there's only only go after A players. Talk a little bit about that. You got to hire the best to be the best, that mentality that you have For sure.
Speaker 1:So I interviewed every single person. We hired at Focus. So you know, we went from. I think. When I walked in the door there was 18 people. We're now close to 90 people. I hired every. I just I'm like I'm going to meet every single person.
Speaker 3:Regardless whether they were sales or whatever.
Speaker 1:Everyone and it kind of drove the team crazy a little bit. It slowed things down. But, like, this is the number one thing we're going to do is hire. These folks are going to help us grow. They're the face of focus.
Speaker 1:I had this mentality of everyone sells. Now, we didn't force it too hard. But you know, we had a lot of resources that were really good talking to customers and they're just behind a screen all day and so our, our mission was like get out in front of customers, get out in front of prospects, and everyone in the company is going to do that and I encourage everyone to do that. You know we we drag people, that I'm not a pre-sales resource. Well, you are today because you know this self software that we use and you know this, this process that we use. You put it in place, so you're going to come talk about it and, and that helped a lot.
Speaker 1:But on the hiring front, this is just going to sound so oversimplified, but there's a couple of people that were like Doug, you really got to meet every single person. Like what are you looking for? And I said normalcy, and they're like what I'm like person just, first and foremost, just needs to be normal. There's ways to kind of see that and you know my interviews were, they weren't like hard interviews. You know I'm not like torturing people, but they'd go two, sometimes three hours really digging into what have you done in your career? Why does focus look attractive to you?
Speaker 1:By the time they got to me, they had maybe met with four or five people. And some people would look at me and they'd say and I learned this, this was something I learned at EMC they would say I've met with like seven people. So you must have a doubt that I'm the right person and I'm like no, the exact opposite. We want everyone that you're going to interact with to meet you. We want everybody nodding, saying yes, we should hire this person, because then when you come on board, no one wants to look like they made a hiring mistake. So everyone's going to line up and try to help you and make you successful. So we want you to meet everyone. So so you know it worked.
Speaker 3:We hired some, some really good people and it, it it's it's a huge reason why we had the growth that we had. Okay, yeah, so we've talked about this a little bit. Matter of fact, one of the reasons you're here this week is to to help run one of the the tracks that that we're running here around sales. You and I hear it a lot from MSPs in the market. Sales is not a focus for enough MSPs. As a matter of fact, it's almost a bad word, right, it's almost a bad word. Why do you think that is and why were you so passionate? Obviously, you were a sales guy for so long, but why were you so confident that you knew you could come into a VAR business and really turn it around from a sales perspective?
Speaker 1:Yeah, you know, as we got better and better at the MSP stuff, I started to participate in some peer MSP peer groups and what. What just struck me, kind of really had me scratched my head, was, you know, we'd go around the room, people would introduce themselves and they would talk about their growth. Oh, we grew 6% last year, we grew 5% last year. And it got to me and they would say and we have no sales team, and they were proud of it, yeah, bragging about not having a sales team. So for me that's just so. I don't know.
Speaker 1:I was really struck by that and I'm like, all right, these are, these are founders that are technologists that probably got burned by a salesperson somewhere along the way and just don't like the word sales and think it's got a bad connotation. But they're all in the room bragging about having no sales team. And then it got to me and I'm like we have 10 enterprise class salespeople and we grew 950% in five years. Like why are you all bragging that you don't have sales, sales force? So I found that odd. Now I know there's companies out there that are that are growing fast and they might not have a sales team the size of ours.
Speaker 3:But without that there's no way we would have had the success that we had and that we're having, I think, to the label of sales is maybe the issue, because the MSPs that I hear that say they've grown without a sales team. They've got a sales team. They're internal, very focused, more strategic selling. They might be engineers that get pulled in at, you know, at the point of sale, but you can't not have a sales. Even the owner right, the owner is typically, you know, owner led sales. That's how they're handling things, you know you've. You brought a different sort of strategy in place and said I need to build a team, right, and was there a sales team when you started at Focus? Yes, and so what was the conversation you had with them to say we're going to change this right, Like, like, how did that go?
Speaker 1:Yeah, not great. Yeah, and again, these are not, uh, not bad people. Yeah, I liked them all, but they were lifestyle folks. They said, okay, if I sell X amount of revenue and gross profit, I'm going to make X amount of income and I'm happy with that, yep, and that. And you know I can have a good lifestyle and not kill myself working too hard, and again, there's nothing wrong with that. But I come in and I'm like, no, you know, we're going to double your quota, you're going to have to forecast. And they were just like this isn't going to be fun, but that's the only way I know how to grow. You know you got to set goals and you got to push people to hit hit those goals and you got to aim high and think big.
Speaker 1:I was walking around and you know we started having company-wide kickoffs every year, quarterly updates on how, the how the company's doing. And this was very foreign to the folks there and we would always have a theme, you know, and my first theme was think big. I'm like we got to think big, like why is everyone thinking so small? People were afraid not afraid, but just hesitant to put a big number in front of a customer, whether it was a VAR sale or an MSP contract. Oh, they're never going to go for that because that's too expensive. And just EMC like we were always 20 to 30% more expensive than everybody else, sometimes with lesser technology, and we would win because we'd show the value in working with EMC as a partner. So we took that same approach at Focus and I really got out in front and so did our management team, meeting with customers and showing some of the folks like watch, how this goes right. We're going to show the value. We're going to show the product that we're going to deliver. We're going to treat the customer extremely well. This is going to be an experience like they've never had before, and because of that, they're willing to pay for it.
Speaker 1:And then what we did see again, I think timing had a lot to do with this we were winning business away from a lot of smaller MSPs that weren't you know. They were going in and having their strategic business reviews, talking about how many tickets they closed the last 30 days, and we were not doing that. We were roadmapping technology roadmapping, trying to show the customer how you can use IT as a competitive advantage, speed up your process, and it was just a different approach. We completely rejiggered our quarterly reviews with our customers, because that was another problem with the reps and some of our technologists. When was the last time we did a quarterly business review?
Speaker 1:A customer doesn't want that. What? Yeah, they might not know that they need it and we need to go convince them and show them the value. We call it validating the value and I'm like do the, do the business review and if they refuse to take a meeting, let me know and I'll call high in there and I'll tell. And if they refuse to take a meeting, let me know and I'll call high in there and I'll tell them why they need to take the meeting. If they still won't take the meeting, send them the report, show them how it's different. And then we, and then we started doing those reviews.
Speaker 1:But to your point on MSPs that don't think they have a sales team, I mean everybody's selling, when they realize it or not. I've heard MSPs talk through. Well, we don't have a sales team, but we have customer success people, we have engineers, that and I'm like you're all selling, you're all selling. You know, my old boss at EMC used to say to me everything in life is a sales call everything, and that's the mentality that we took and it worked.
Speaker 3:That's great. So your story is pretty unique, doug, because most MSP owners are their founders. Right, you weren't that. You were someone that saw an opportunity, saw something that you wanted to go after, proved yourself very quickly and were given an opportunity to take over, buy in and then obviously lead the company forward. Can you talk about what that opportunity meant for you and obviously the founder, the humility that he had to be able to say I'm not the guy to get us to where I need to get us.
Speaker 1:Yeah, he w he was. He's a risk taker by heart. He loves rolling the dice and, you know, as this acquisition landscape started to unfold, he kind of knew like, all right, I'm eventually going to want to sell focus and I want the biggest bite of the apple that I can get and I'm probably not the person that's going to do this. He was very close with the employees. I think in the back of his head he's like they're not really going to listen to me when I say we need to go do this stuff. So he hired me in as the VP of sales, like I said, and we started to have a lot of success. Now, if I had no success, it wouldn't have gone this way. So, a lot of success. Now, if I had no success, it wouldn't have gone this way. So I went to him and I said look, we've got to continue to invest in the business. We really had very little EBITDA when I walked through the door, but no debt and a good foundation. And he's like all right, go do your thing. So then, as we started to have success, I kind of went to him and I'm like I don't have any equity in the company, I'm doing all the work and what can we do here? And he stepped right up and he's like here you go. And he gave me an employment contract. He gave me a management incentive plan where, if we were to sell, you know, I would get X amount of the business. So then it's kind of interesting what we did. I have a lot of battle scars in this area to talk about, but we're having all the success.
Speaker 1:We integrated that MSP but again, we didn't have a lot of big capital behind us to go do more acquisitions, which is what we wanted to do. And we were getting, probably honestly, five emails a day from this MSP roll-up strategy that was happening with private equity, lots of people reaching out. We were interested in buying focus, interested in buying focus. So we got together and said all right, maybe now's the time to take on a private equity partner, sell the company. Basically, bruce would get his chunk, I'd get a little bit from the plan that we had in place. So we went out to market and we tried to do it on our own. Big mistake, I learned a lot, but we kind of tried to. And we tried to do it on our own. Big mistake, I learned a lot, but we kind of tried to.
Speaker 1:We started to respond to some of these inquiries we were getting and we got down the road and, without getting into too much detail, it was quite the process. We had a couple of starts and stops, we got really close and it kind of fell apart at the end, not because of us, but the people that told us they had money didn't have money. It was just a weird thing. So we put the brakes on that and then we said we still think this is a good time. So I said to bruce, let's do this right, and we hired an m&a consultant to really take us out and they packages, packaged us up and took us out the right way, and that this process was just grueling. If we want to have another podcast, talk about this again. Yeah, thank god for chris, because he had his finger on all of our data and we were very well organized. So if you're not and you're trying to do this, that's gonna hurt.
Speaker 1:So we went out again. We got a lot of interest. We had had 12 offers, narrowed it down, picked a couple, and then it was dragging out and kind of taking a long time and towards the end it just didn't feel right. So I went to Chris and I said how do we buy Focus and give Bruce what he needs and do that? So we did that. So we did a majority recapitalization of the company that left me as the majority owner. Bruce got a good chunk of dough, took some chips off the table. We kept him in the company so he still had minority ownership in focus. I ended up as a majority owner. I was able to give Chris equity. So it was a good thing that we did, because we no longer had just one owner with no capital. We had some capital behind us. We were able to give out some ownership and that's when I became the CEO majority owner.
Speaker 3:That's great. So you talk a lot about Chris and I got to know Chris. Chris was one of those rising stars, right. I mean he had basically become your right-hand man over the years and you trusted him with the finances and so much more. But at some point Chris had the same conversation with you that you had with Bruce. Can you talk a little bit about that?
Speaker 1:Yeah, so I've been at this 30 years, the last eight at Focus. I'm kind of painting this like, oh, you just do this and you just do that and you're good.
Speaker 1:It was a lot of hard work so we continue to have success. But if you think about it right, we had Bruce who was a great owner but didn't have a lot of capital around him to go make more acquisition. We transferred that to Doug me. So, again, good, majority owner. No, no capital behind me. So if you're looking at what's going on out there and again back to kind of the think big, like we want to be a big national MSP platform, like that was the goal, but without the capital behind us, that was going to be hard, because the quickest way to do it is through acquisition. Yeah, the we did two.
Speaker 1:The one that we did on the MSP side went so well, so I got with Chris. I'm like I think we need a financial partner, but we didn't want to sell, so we did a second majority recapitalization. We took on some debt financing, gave up some equity. Along the way there I was able to take a step back. I moved to the board of directors. I'm out of the day to day now, chris. So Chris is 10 years younger than me and they always say hire people that are smarter than you. And that's what I did, right, so Chris is like you know, he was with us for six years. He was so ready to step into the role. I was ready to take a break. So we did that with with a financial partner. We didn't sell the company. The employees were nervous about that. The management team was nervous about that. The other thing I really say this people's kind of looking at me cross-eyed a little bit, but I think we threaded the needle with what we did. So we took on a capital partner. That's great for us.
Speaker 1:Chris took on the role of CEO and now we have this unbelievable management team. We're now able to give real equity in the company too. We created a management incentive plan for all of the employees to get a piece of the action, so we were able to spread that out and now everyone is really not just career-wise but financially tied in to the future success of Focus. So we just had our first board meeting a couple of weeks ago. We want to go make more acquisitions. We have a very strong financial partner behind us now that doesn't isn't the majority owner of Focus, and so we're not owned by private equity and but we have the ability to tap into it and we have some capital behind us.
Speaker 1:And, ian. That was better for our customers, all of our employees, rather than just getting acquired either by a strategic or private equity that comes in and just changes everything. So it was a lot of hard work and we found the right partner and I think things look great for the future. That's fantastic, doug. So. And, by the way, bruce still has some equity, so he got two swings at the bat and still has a piece as well. So I still have ownership, bruce still has ownership, and we have this capital partner now, which is great.
Speaker 3:I love. You know owners, business leaders like yourself, that obviously you want to take care of yourself, your families, you know your management team's families. But to look at the rest of the team that you've built and say we want these guys to have a piece of it, I mean, as a former employee of a very large MSP, that meant a lot to us when I knew, hey, if we do sell someday, I got a piece of this. So everything that I do on a daily basis and not every MSP can do that, but you guys figured out a way to do that and that's that's really special. So here's my question what are you most proud of as your time as CEO at Focus?
Speaker 1:This might sound a little self-serving, but I love doing things when people tell you you can't do them. So when I left EMC and I came to Focus, you know I had a pretty strong network in New England and I know for a fact people were snickering and kind of scratching their head like Doug's lost his mind. What is he doing? This is never going to work. Some of the employees inside of Focus the lifestyle people were like this is never going to work. We'll just wait out. Doug, I had customers of ours, good customers of ours. Look right at me. I know what you're trying to do, doug. You're not going to be able to do it. So I'm proud of the success. I'm proud of the our ability to kind of fight through all that negativity. I had two. This was really interesting. So I had, I knew, I knew two owners of of local bars and services companies in the area pretty well that I considered friends, you know for my dating. When I got to focus, within the first week they both called me up and threatened me. They said look, one of them said to me we're a lot bigger than you and if you start to steal my talent, I'm going to put aside a huge pile of money and I'm going to drain your organization of all your good people. That's what he told me. Wow, he's a friend of mine. Yeah, I was like, listen, there's enough business to go around for everyone. I have no plans to do that and thanks for the call. Yeah, but that was a huge motivator to me. Everyone's saying this isn't going to work and there were moments where I thought it might not. We had, we had a lot of lifestyle people starting to check out kind of quitting on us and but our ability and I told Bruce this I'm like Bruce everyone that leaves I'm going to replace with someone 10 times better. And I just had that belief that we're going to do that. And that's exactly what we did.
Speaker 1:So I'm proud of the success. I'm proud of our people. I'm proud of people believing in what you know, what we set out to accomplish. Now, everything isn't all roses like. We're not perfect. We've still got lots of warts and lots of challenges that we we still need to work through, but there's nothing like you know. Looking up at the numbers, you know we went from 18 people maybe doing 18 million and now we're, you know, our best year. We're close to 60 million. We're almost 90 employees now. We've got a great capital partner behind us. We've made a couple acquisitions. We started winning some some real nice awards along the way. We got named a fast 50 by boston business journal. Fastest growing companies in boston got put on the inc 5000. We've won Boston Business Journal Best Places to Work, which is another thing I'm hugely proud of.
Speaker 1:In 2020, we were number one in Best Places to Work in Boston, so that told me that the cultural change that we made worked and people really enjoyed working at Focus because that's an anonymous survey of our employees and how they like working at Focus and we came out number one in that. So those awards, those accolades, you know it's all good stuff that kind of validates that you did the right thing. I also had someone at EMC tell me don't forget, yesterday's steak is today's shit. So you got to keep going and never be comfortable and satisfied.
Speaker 3:You have so many feel good moments. Obviously, I know there were some rough times and you don't seem. I know you said that. I'm sure there was moments in your past where there was some self-doubt and, man, am I doing the right thing? But we always like to ask this. I know you probably led into this a little bit, but when was the moment that you realized this? Was it Number one that you chose the right?
Speaker 1:career to begin with, that you made the right decision. Like how did you know that this is it? I think after we made that MSP acquisition and like I love being in front of customers we had, we had so many customers to go talk to and you know we would get excited when we, when we signed a three thousand dollar a month msp contract and we closed one for eighty thousand a month. And that's when I was like this and it's working very, very well. And then just having all the people around me that I hired in I could name them all but they probably don't want me to name them. But you know we put a lot of structure in place and just looking at everybody, so dialed in with kind of the moment, like I'm like all right, this all worked. You know the people that were just kind of flipped the switch and said, all right, we're going to dig in here and work hard and just watching the numbers go up has been great. You know we're at a little bit of an inflection point right now. So go up has been great. You know we're we're at a little bit of an inflection point right now. So our product business is flat. Msp keeps growing like crazy. It's the best, fastest growing, most profitable part of our business and it has been now for the last three to four years. Awesome. And that product business we still like it. There's still a lot of product being bought out there. It helps us win MSsp business because we we get a lot of why are you guys still in the var business? But I can't tell you how many times because we have people that know delhi, mc and cisco and and cloud based technologies and we get into an account doing that first and then we're like, by the way, we can manage all of this for you and that's just gone extremely well and help us get much larger contracts having that VAR business.
Speaker 1:And then obviously I got to plug Enable. So we were with another partner at the time that had got acquired and we're a pretty big customer of theirs and they just kind of went dark on us and I don't think it was any individual's fault, it was just kind of circumstances, and we put a 12-month process together to pick our next vendor in this space. This is worth telling this story. We're based in Boston, you guys are headquartered in Burlington, so Enable was on the list to go look at. So I sent the technology team out to Burlington to get a demo of the product. And they come back and they're like yeah, no, we're not going with that. I was like why? And you know, they start telling me the technical reasons going over my head, and I'm like so I called ahmed, who you know, who's our dp of managed services.
Speaker 1:I'm like, ahmed, you're going back and chris and I went out and we met with john and chris at your headquarters in burlington and the relations we could just tell like they're right down the street, these are good guys, the technology we know is going to work and we're going to get really well taken care of. So I came back to the office after that meeting. I'm like these, these are great guys, they want our business. I sent the tech team back in there and I asked Enable, can you do a much more detailed, deep dive into the product? And of course they come back and like this is the greatest stuff ever. So that's where our relationship started and we took a long time kind of moving everyone, all of our customers, off and on to Enable and it worked phenomenally well and we continue to grow with you guys and the relationship's been super strong and it's I would say it's the best partnership we have with our vendors right now.
Speaker 3:Wow, thanks, doug, really appreciate you, obviously your support and you being a customer, and it shows the type of people that you've hired, though, because every one of your leadership team that I've come into I feel like I'm friends with. I mean, you build that relationship. You're obviously a big relationship selling guy and it's just something about having those relationships with your vendors and this is a community, so really appreciate you being part of this week here and you're going to help a lot of MSPs out. We could do a three hour podcast about your story, but hopefully this was valuable to a lot of folks. I think you got a lot of great stories there. So let me ask you, doug, what's next for you? You've taken a step back out of the CEO role. You're still on the board. You're still very much involved with the focus team. Saw you at dinner the other night. What's next for you?
Speaker 1:Yeah. So I wanted to take a legitimate break in the action. I've been grinding for 30 years and I was, you know, admittedly, feeling a little burnt out. So I took a step back and then my phone started ringing and I'm helping right now. Some private equities look at MSPs that they're thinking of acquiring, and then I'm working with some MSPs directly as a consultant to really look at their go-to-market strategy. So if anybody's out there, you can find me on LinkedIn.
Speaker 1:Doug Alexander, you know small engagements where I just have a knack In my career. By the way, as a manager, I was always given the district that was struggling, the team that was struggling. We need to go turn this group around. For some reason I just had an act for doing that so I can quickly look at an MSP model, the service offering the people that they have, you know, interview the teams, understand the sales strategy and kind of give some strong recommendations on what they need to do. So that kind of has just happened organically.
Speaker 1:My phone's been ringing. I've been doing some of that, of course without breaching any contract inside of Focus for non-compete, non-solicitation, but that's going pretty well so and I enjoy that, like that's what I really like doing because it's very natural to me and I love seeing the success of the result of it, in that accomplishment I talked about earlier. I think there's a little bit of a myth out there that this is going to be so hard to do. Just get started and it's easier than you think. It's not easy, but it's easier than you might think.
Speaker 3:That's great, Doug. You're going to be very successful doing this for the next X number of years until you're ready for the next exciting venture. I wish you the best of luck. I want to really personally thank you. This had been when we started this podcast about a year and a half ago. I always wanted to get you on just because you're number one. You have such great experience, such a good message, but mainly because you're just such a good guy, and so I really appreciate you being here. Enjoy the rest of your week here at Empower and thank you so much. Yeah, thank you.
Speaker 1:Appreciate it.