AWS Partner Gets Another Cash Infusion to Pursue 'Mission'

By Kevin Casey

Ordinarily, a $15 million private equity round isn’t headline news. These kinds of deals happen daily. Add that on top of $75 million invested in the same company barely two years ago, though – a cloud managed service provider with fewer than 100 employees, to boot – and you’ve got a story, one that speaks to the voracious investor appetite for cloud plays in the MSP market.

We’re talking about AWS partner Mission, which recently announced its latest funding round with Great Hill Partners. Mission sprang from a merger of three smaller MSPs – Reliam, Stratalux, and G2 Technologies – in 2018, backed by a $75 commitment from Great Hill partners in late 2017.

Mission’s Simon Anderson

If you wanted to sum up both the story and the strategy here in a single word, it’s doubtlessly this one: growth. Like the cloud space in general, it’s all about growing as fast and as sustainably as possible. Mission’s headcount has increased 70% during the last year, for example. Since the mergers of the three distinct cloud MSPs, Mission’s revenue has increased sixfold, and it doubled its enterprise customer base to 175 firms. (Fun fact for sports fans: In March, Mission announced it had become the official cloud services partner of the Boston Celtics.)

Mission has spent around $40 million of that initial $75 million. The new round will beef up the coffers for additional hiring, technology investments and go-to-market strategies, the company said. Great Hill Partners also indicated it would consider further investments in the future.

We caught up with Mission CEO Simon Anderson to get the scoop on why the firm did another funding round, what the money will be used for, and his general take on the white-hot cloud MSP space.

Channel Futures: Tell us a little more about the new funding round. Why now? What will the capital be used for?

Simon Anderson: The new capital is to support the expansion of our sales team into the U.S. Central region, plus investments into more CloudOps and DevOps engineers to serve our rapidly growing customer base with broader skill sets.

CF: Can you share some examples of how the previous capital investments from Great Hill Partners have been put to work?

SA: Mission has invested in a unique go-to-market strategy that is closely aligned with AWS sales. We’ve also used the existing capital from GHP to build out our team, systems and platform to support rapid growth over the next two years.

CF: Share a stat that highlights Mission’s growth.

SA: We grew our team over the past year from 50 to 85.

CF: You mentioned the possibility of additional investments from Great Hill and/or partners, including for potential acquisitions. Can you tell us what you’re looking for in terms of potential acquisitions or deals?

SA: Mission will look to our customers’ needs to determine potential acquisitions, which will be focused on technical teams and having the right capabilities in high-demand focus areas including containers, serverless, and AI and machine learning.

CF: Do you expect venture capital and private equity interest in the cloud MSP space to continue to grow?

SA: Yes, definitely. It continues to be a hot space ripe for VC/PE firm interest.

Cloud is not the only …

… space crowded with deals and dealmakers; security might be even hotter. Let’s look at some other recent news of note in the channel.

Cybersecurity M&A

Cloud isn’t the only space with a claim to the M&A throne; the crown seems to fit security well, too. There were 20 different M&A deals in the security sector worth a total of $2.2 billion in May, according to advisory firm Momentum Cyber. The biggest deals were:

The median deal value was $185 million. Managed security service providers (MSSPs) were the largest segment of the overall sector, with five different deals.

Oh, and there was nearly another $1 billion in funding transactions in the cybersecurity industry, with $946 million raised across 45 deals, according to Momentum.

Introducing Iconic IT

There’s a rule of thumb that suggests many MSPs have a tough time scaling beyond 20 employees or so without some help. (Anderson, the Mission CEO, mentioned that in an interview with us last year, for example.) One form of help: joining forces with other MSPs in your space.

That’s part of the story behind Iconic IT, which will become official on July 1. It’s the merger of four MSPs focused on the SMB market: Capstone IT (based in Rochester, New York), Choose Networks (Wichita, Kansas), Live Consulting (Denver), and Networking Results (Dallas). All four companies had been part of the same ConnectWise Evolve peer group. The combined companies will be led by Capstone co-CEO Mike Fowler as CEO of the new entity, with leadership from each of the original four companies taking on various executive roles. According to the company, the chief goal of the merger is to create an MSP with a national footprint that maintains its local, small company feel.

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