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Vertical Market Size
How large does a target vertical market need to be in our geographic footprint to make it viable for an MSP to market to and grow? Is 100 firms too small?
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4 Replies
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Hi David:
A good rule of thumb is that an MSP needs 50 clients for independence to reach the million-dollar target. There are many variables around this, but this is what it always comes out to.
Now, that does not mean you need to find 50 clients in your vicinity. If. You are in New York; you can find 50 XYZ avatar within a few blocks. But anywhere else, that might be a challenge.
Here’s the thing it is MUCH easier to serve a broader geography than it is to serve multiple avatars. Services like touchless install or Field Nation can allow you to be anywhere. And it is much more important that you have a deep understanding of your avatar’s problem than you be local.
What this ends up meaning is that almost any market segment will work.
One place to start is to go back to your favorite clients and see what commonalities exist and what you like about them. THAT is the place to start…
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Once you have defined those commonalities, look at your client set, and see who you have done something “special” for. What was it you did how did it fix a problem that they had. Did they see the value in having that problem solved? Can you do that “special” thing 100 times for a client just like that one?
You are looking for the thing that makes you different.
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I had a small break-fix CPA client contact me during tax season as he was not able to access his tax application. I troubleshooted it and got him back up and running with a relatively quick solution and he was very appreciative of it. I used to do that kind of work all the time when I worked full time at my prior IT job at an accounting firm. Knowledge of the applications CPA firms use and experience in troubleshooting them and getting to the right answer.
I had another break-fix, also a small CPA firm, contact me during tax season as his IP phones were intermittently going down. We came onsite later that day after hours and fixed the issue relatively quickly. It turned out there was an old router interfering with his internet connection, so we just removed it from the network and turned it off. He was very happy we took care of this problem.
Does either or both of those seem like the thing I should be focusing on?
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What I like is the fact that you worked at a CPA firm. You have to leverage that experience. Once you have gone through the business machine modules you should complete this course. https://sgmcommunity.com/courses/brand-story-training/ it will help you define the problem you solve and for whom.
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