IT Service Providers Get Boot Camp in Recurring Revenue Growth

MSP expert Len DiCostanzo has had a long career, working for more than 30 years as a channel executive. DiCostanzo describes himself as “dynamic” and a “visionary” who has established effective strategies and processes to accelerate company and partner revenues and profitability.

And he wants to share those strategies with attendees of this year’s MSP Summit. During his session, ‘Managed Service Accelerator Program: Grow Recurring Revenue,’ DiCostanzo will describe what makes recurring revenue critical for a managed services practice.

MSP Toolkit’s Len DiCostanzo

“I have worked with IT service providers (ITSPs) just getting started building their managed services business, or those still in the process of building, as well as mature ITSPs still looking to improve, and I reinforce these issues as they apply to all,” DiCostanzo told Channel Futures. “Certainly, one of the keys to improving and maintaining your operational maturity level is to follow a process of continuous improvement to always be working on becoming more efficient and automated at delivering the outcomes clients want and expect.”

History of Recurring Revenue

DiCostanzo offers a historical tutorial about recurring revenue business, which managed services have based their business model on since inception.

Initially, the break-fix model utilized by ITSPs was the predominant model before managed services, but was fraught with issues. Time spent on service delivery had to be tracked properly, billed efficiently and collected on time. This rarely ever happened and resulted in cash flow and profitability issues for ITSPs.

This led these service providers and the industry to develop and adopt the managed services recurring revenue business model. Time tracking is eliminated, at least in terms of being tied to invoicing. The billing process and collections are much more efficient. As a result, ITSPs now have a predictable revenue stream and are more profitable.

Business Transformation Stages

However, getting to profitability means there are many key transformation stages as an ITSP to build their managed services practice.

DiCostanzo focuses on five key stages:

DiCostanzo plans to launch the MSP accelerator program as a complete two-day workshop in the fourth quarter of this year. Participants will be able to register and attend online. But you can get a jump-start by attending his session at the MSP Summit, Sept. 13-16, in Orlando.