If you are a Microsoft partner looking to sell your business, you're in the right place at the right time. The most recent Equiteq survey found that Microsoft technology expertise continues to be the largest vendor capability associated with IT consulting M&A deals.
However, it's important to know that buyers today are more sophisticated, more selective and savvier than ever before. They can smell a bad deal from a long way off.
Buyers today have their antennae set on high alert for companies that fit specific profiles that are accretive to their overall valuation, and that are aligned with already-established expansion strategies and culture.
While there is no wiggle room for mistakes, many Microsoft partners already have a head start on positioning their companies to attract even the most selective buyers.
What Buyers Want
Want to see if your business will capture the attention of today's buying community? Here's a checklist of characteristics attractive to the types of companies that will pay well for what you've built. Assess your organization carefully to determine if you offer:
SMAC solutions. Social, Mobile, Analytics and Cloud offerings are non-negotiable -- make sure you offer solutions in these areas to attract buyers.
Depth of vertical market and domain expertise. Having a proven track record of expertise is invaluable. Strive to keep your business at the intersection of deep vertical market expertise and deep technical expertise that will service the needs of that market.
Clearly differentiated offering. Ideally, you'll want that offering positioned as No. 1 or No. 2 in the market you serve.
Double-digit annual growth. Buyers will want to see it in both your revenue and profit.
The ability to create and market IP offerings. These should flow naturally out of your specialized expertise. Future attractiveness to both technology buyers and consulting firm buyers may well depend on this.
A healthy balance sheet. You'll want to show strong retained earnings and minimal debt.
Marketable IP. Buyers will want to know that you have offerings that can drive additional service sales that are complementary to the core service being offered.
Recurring or subscription revenue. Make sure that your recurring or subscription revenue is at least 30 percent of total revenue. More is better.
A continuous stream of one new breakthrough expansion strategy per year. Maybe it's an expansion into a new geography. Or getting into a new service line. Or a new delivery system. However you do it, show some vitality.
Bold expansion strategies. Demonstrate your company's vision for the future. Is your organization caught in the grind of managing day-to-day operations, or have you positioned yourself to focus on growth?
What Buyers DON'T Want
On the flip side, the top four factors that deter buyers are:
Poor cultural fit. Why struggle to make the merger work if your employees and customers are coming in with very different expectations? It's much easier for buyers to find one where everyone's on the same page -- or at least the same book -- to begin with.
Diversity of service offerings. The more broad the spectrum of services, the less likely they are to be interested.
Market generalist focused only on technology. Today's problems are often very industry and business-specific, and so are the solutions, so deep, specialized knowledge may be more attractive. Often, buyers are looking for someone to complement capabilities they already have; broad and overlapping expertise lead them away from you.
Poor growth and profitability. Even if you have skills and expertise, buyers are looking for an extra sail, not an additional anchor. Demonstrating sound business knowledge can be as important as showcasing technical know-how.
As we said above, many Microsoft partners are already well-positioned to attract buyers. Not only do you offer solutions and expertise customers want, but you have access to the vast partner network and the resources Microsoft offers.
Continue to nurture both those partnerships and your business acumen, and one day you may well hear: "Hey there, we like the way you've built your business; we like how you've positioned yourself in the market, how you've smartly driven revenue and profit, and how you've invested for the future. We have an interested buyer. Can we talk?"
Posted by Mike Harvath on June 20, 2018 at 10:28 AM0 comments
What can Microsoft partners do differently in 2018 to make a business breakthrough? We put that question to 16 top experts, including PER WERNGREN, CONTRIBUTING EDITOR, REDMOND CHANNEL PARTNER MAGAZINE. For more tips on finding success in the Microsoft channel in 2018, read our full Marching Orders feature here.
Every year someone is moving the cheese. To be successful you will need to identify what has changed and determine how to act.
Being a Microsoft partner in 2018 will be great as Microsoft continues to bet heavily on innovation and to embrace the partner channel. But it is important that partners also make an effort to innovate on their own because doing that in combination with Microsoft's investments will help us all to grow our collective market share. We need to win more in Apple-land and Google-land. The economy is expected to grow throughout 2018 and parts of 2019, and IT is being integrated even more with how to drive a successful business. These are great times to be in IT as long as you place your bets right!
In the past, the Microsoft partner conversation was often about Microsoft Competencies (i.e. practice types). But now we see a big change as we care more about which verticals we serve. Several verticals are underserved and have a great demand that is driven out of Digital Transformation. I am personally convinced that health care, finance and public sector are great bets from a vertical perspective. Be aware, though, that if you're new to public sector, the processes associated with selling within that vertical are often slow and complicated.
From a practice and technology perspective I am convinced that artificial intelligence, machine learning and augmented/virtual reality are truly safe bets for the future. There is a great demand from customers in these areas and investors are eager to jump on the bandwagon and support such companies. But competition is stiffening, and it is important to not only have great knowledge. You will also need to make sure that you know how to go to market and sell your products or services. Marketing and selling is often a weak point for Microsoft partners as many have not fully embraced digital marketing and learned how to sell without sending out guys in suits to make expensive customer calls.
When you combine the right vertical with a deep knowledge and great technology offerings you will have a very successful combination. And don't forget that subscription-based recurring revenue models are always more fun than repeatedly having to sell projects.
Where not to bet? This sounds negative but it is important to recognize that there are several areas that will not be successful going forward. One of them is to be to general as this is the era of specialization. Customers wants to deal with partners that are great at something rather than good at everything. Try to narrow down your portfolio of offerings and find partners that can help you with the areas that are outside your own scope. I would be negative to traditional infrastructure practices unless you have carved out a very special niche.
Setting up and managing servers with a focus on hardware and operating system is an area that is best handled in the cloud where tasks that previously demanded specialized staff are now commoditized and can be handled by less skilled people (or even automated). Many traditional systems integrators will need to either retrain their staff or downsize if they don't find out how to be relevant dealing with services in the cloud.
Another pitfall is if you just resell without adding any additional value. Without adding your own IP, reselling is a race to the bottom. Customers will no longer do business with you just because you are a nice guy. Instead they want to deal with someone who can truly provide value. If they just want a reseller, you will face competition that will be hard to beat and leave you with a less than acceptable margin.
Everything above is important also for the ones that see 2018 as the year for them to merge or make an exit. In order to attract someone to invest in your company you should make sure that you are geared for the future and not stuck in the past as that will help you get a premium offer. Investors love someone that has a clear vision of their position in the future.
Lastly, I think that cybersecurity will continue to grow in importance and there are great opportunities for managed service providers as the villains becomes savvier and customers need proactive protection. This market is enormous as everyone needs to protect themselves – both companies and households which means that you can easily find a sweet spot in the market to address.
There's opportunity out there this year. Enjoy!
Per Werngren is a serial IT entrepreneur based in Sweden and a staunch advocate of partner-to-partner relationships in the Microsoft ecosystem. He has held many roles at the worldwide level of the IAMCP, including chairman and president.
Posted by Per Werngren on March 22, 2018 at 8:43 AM0 comments
What can Microsoft partners do differently in 2018 to make a business breakthrough? We put that question to 16 top experts, including ARLIN SORENSEN, VICE PRESIDENT, PEER GROUPS, CONNECTWISE. For more tips on finding success in the Microsoft channel in 2018, read our full Marching Orders feature here.
When I think about the most important piece of advice I can offer, it is the importance of defining two key numbers. These are the financial success metrics of personal and business legacy and, unfortunately, too many do not focus here until far too late in their journey.
Every person needs to define their personal wealth target (PWT) or the number they need to accumulate during their working career that enables them to live their ideal life after they receive their final paycheck.
If you are a business owner, there is a second number that matters called business value target (BVT), or the number you need to create in business value to provide the outcome shareholders expect and need. In most cases, the outcome of business value is what flows into an owner's personal wealth and will hopefully provide the dollars to close the gap between where an individual is today and where they need to be in the future.
Personal Wealth Target (PWT) ___________________
Current Personal Wealth ___________________
For most business owners, their portion of the company BVT needs to be enough to close the gap, as they have typically put all their eggs in that basket for their future.
Too many wait far too long to define these two key numbers and create a strategy to assure they achieve them. That's what HTG is helping shine a light on and provide accountability and strategy to assure legacy success.
Arlin Sorensen is vice president of Peer Groups at ConnectWise. Sorensen was the founder of Heartland Technology Groups (HTG), which served more than 600 members from 500 unique companies in North America, Europe and New Zealand. ConnectWise acquired HTG in January.
Posted by Arlin Sorensen on March 07, 2018 at 9:04 AM0 comments
What can Microsoft partners do differently in 2018 to make a business breakthrough? We put that question to 16 top experts, including HOWARD M. COHEN, SENIOR RESULTANT, THE TECH CHANNEL PARTNERS' RESULTS GROUP. For more tips on finding success in the Microsoft channel in 2018, read our full Marching Orders feature here.
Burn the word "value" into your mind, along with the word "innovate."
Famed sales motivator Zig Ziglar warned us, "If you're doing what you've always done, you're probably getting what you always got," but that's no longer the case for the IT channel. Now, if you're doing what you've always done, you've been getting less and less, and this year, you're probably done.
The only way to avoid that dismal fate is to recognize three things:
- Customers are only interested in the value you bring to them, so you need to have all of your marketing and messaging focus only on that. Don't talk about the great products and services you offer. Talk about the value of what you provide brings to your customer.
- Recognize that your customers' needs are constantly evolving and changing, so what you provide must constantly be evolving along with them. You must always innovate value.
- Note that I keep referring to what you provide, not just what you do. We've evolved from a partner channel to a channel of partners.
Always define everything in terms of the business value it brings to your customer. Talk about their gains in their language. How do you increase their profits? You must identify new products and platforms that allow you to constantly innovate new value for your customers, or they will forget about you.
The channel has finally completely changed. No longer is it about a product produced by a manufacturer, distributed by a distributor to resellers who sell it to customers. It is now about you. You are the starting point of the channel that delivers value to customers. You pull in services and software from partners you carefully select and vet to provide maximum innovation and value to your customers.
These are not marching orders. They are survival strategies. Others talk about "shadow channels" that simply don't exist. There is no channel. There is you. Your insight, your innovations -- these are what your customers are buying from you. If you're doing something new, you're probably getting more than you ever got.
Posted by Howard M. Cohen on March 07, 2018 at 9:18 AM0 comments
What can Microsoft partners do differently in 2018 to make a business breakthrough? We put that question to 16 top experts, including MIKE HARVATH, PRESIDENT & CEO, REVENUE ROCKET. For more tips on finding success in the Microsoft channel in 2018, read our full Marching Orders feature here.
2018 is the year of partner transformation and to that end, we recommend that you focus on specialization, verticalization and productization." We call it SVP.
We recommend if you haven't done so already, that you specialize on the one area of the Microsoft stack/cloud offering set where you are an expert, that you pick one vertical market to specialize in and leverage the development of your process and tech-based expertise and IP.
If you're a partner that has more than $35 million in revenue you can focus on more than one market/practice area following this formula. Here are some very tangible benefits of following our methodology:
- This approach will allow you to be in the elite club of the top 20% of your Microsoft partner peers.
- It will provide the fuel to dramatically accelerate your growth of revenue and profit in 2018 and beyond.
- Microsoft partners that successfully implement this model have options to grow their businesses in ways they didn't before, can further build and fortify the business and can buy another partner business or sell the business.
- Partner companies that have successfully implemented this business model are in high demand and are commanding a premium valuation.
Mike Harvath has spent his entire 30-year career advising partner companies on implementing winning growth strategies and facilitating mergers and acquisitions. As president and CEO of Revenue Rocket, he and his team have advised over 500 partner companies on reaching their growth goals.
Posted by Mike Harvath on March 07, 2018 at 9:34 AM0 comments
What can Microsoft partners do differently in 2018 to make a business breakthrough? We put that question to 16 top experts, including CHRISTINE D. BONGARD, DIRECTOR, PARTNER ALLIANCES, ATSG. For more tips on finding success in the Microsoft channel in 2018, read our full Marching Orders feature here.
We are living in an exciting time of technological advances and shifts in our industry. Over my 25-year career, I have seen trends shift and then, eventually shift back. My one take away for success in 2018 is to keep things personal.
Due to these advancements in technology and efficiencies with process, we've gotten to a point where people don't need to meet in person. No more looking each other in the eye or shaking hands. No more bonding over family pics and other oddities in our offices. If most people buy because they trust their provider, and people never meet anymore, how is this possible?
I encourage people to get back out in the field and meet with your customers. Bring them a cup of coffee or some flowers. Ask them how their project/service with your company is going. This also goes for your team. Visit your team in their offices and have a cup of coffee with people. Look people in the eye and ask them how things are going. Then, follow up on whatever you commit to doing.
Also, send personal notes, not e-mails, with two to three sentences on why you're happy that person is a client or an employee.
I guarantee you will stand out with class because people yearn to feel appreciated. These small personal touches cost little but yield great results for your relationships, which all support the success of your business.
Christine Bongard manages Strategic Partner Alliances for ATSG, a 20-year Microsoft Gold Partner in the New York metro area. She develops processes and programs to ensure that partners, customers and employees are delighted with their ATSG experience. She also serves as the Global Chairperson for IAMCP Women in Technology.
Posted by Christine D. Bongard on March 05, 2018 at 11:47 AM0 comments
What can Microsoft partners do differently in 2018 to make a business breakthrough? We put that question to 16 top experts, including JEFF HILTON, FOUNDER/CEO, THE ALLIANCE FOR CHANNEL SUCCESS. For more tips on finding success in the Microsoft channel in 2018, read our full Marching Orders feature here.
Sales techniques are always evolving and being refined. One technique is called social selling. The idea is to generate leads by developing and nurturing relationships via social media.
This is not about posting articles on social media and hoping to get some responses. It's about really using social platforms to personally engage prospects and generate leads.
When you think about it, this makes complete sense. Prospective buyers research products and solutions via the Web, but they evaluate potential sellers via social media. Social selling allows you to target and engage the prospects you want, effectively and without cold calling.
To get started you need contact management and other tools to support your efforts. One solution to get these easily is the LinkedIn Sales Navigator. Certain versions of Sales Navigator include a feature called PointDrive. This makes sharing of sales content super easy, and provides tracking information so you can readily see who has consumed or shared your content.
A few bits of advice: Your social selling journey begins with good LinkedIn and other social profiles. You need target-market-oriented thought leadership content that demonstrates your expertise. Start small, learn and then use social selling to drive sales success in 2018.
Jeff Hilton is the founder and CEO of the Alliance for Channel Success, an organization focused on helping partners grow more successful and productive practices. He and his team are regular contributors to RCP Magazine, and yearly presenters at Microsoft Inspire and other leading industry conferences.
Posted by Jeff Hilton on March 05, 2018 at 11:37 AM0 comments
What can Microsoft partners do differently in 2018 to make a business breakthrough? We put that question to 16 top experts, including KEITH LUBNER, MANAGING PARTNER, C3. For more tips on finding success in the Microsoft channel in 2018, read our full Marching Orders feature here.
While technology is a great enabler, it is also the impediment to your success as a selling organization. It is becoming increasingly difficult for prospects and customers to differentiate your offerings from those of the competition because it's so easy and simple for the buyer to gather information on you before your first interaction with them.
The divide between buyer and seller is becoming wider, I'm afraid. To overcome this, one must boost their soft skills, not their technology skills, in order to connect, understand and differentiate. In 2018, you should remember these three words in order to pivot your path to greater success: listen, learn, lead. Do more listening when interacting with buyers. Listening allows you to learn more about their unique challenges. And when you know more, you can lead the buyer to a solution that you tailor fit to them.
Keith Lubner is managing partner of C3, a global consulting organization focused on channel strategy, design, enablement, outsourcing and training for growing companies. He is also co-founder of Channel EQ, providing 2.0 channel training for peak performance.
Posted by Keith Lubner on February 26, 2018 at 12:46 PM0 comments
What can Microsoft partners do differently in 2018 to make a business breakthrough? We put that question to 16 top experts, including ERIK FRANTZEN, PRESIDENT, NURTURE MARKETING. For more tips on finding success in the Microsoft channel in 2018, read our full Marching Orders feature here.
Forrester Research Inc. recently published a report focused on the partner opportunity for Microsoft 365. One recommendation is for partners to place additional emphasis on partner-specific IP. At Nurture Marketing, we know that marketing initiatives for partners who have their own IP, combined with industry vertical solutions, are far more effective.
Clients now see the partner as offering something different from the competition and understanding their specific business at a higher level.
Stating that all verticals are served and "we are the best" at implementing a solution from a household name provider will only encourage visitors to navigate away.
Finally, we find that partners often have hidden IP and underutilized vertical expertise. Uncovering, productizing, packaging, and delivering these solutions will improve the overall messaging and improve overall client satisfaction.
Suggestions to uncover opportunities, messaging, and hidden IP:
- Look back at past projects. Did you develop a custom solution that can be monetized elsewhere?
- Survey your employees about the concerns clients are discussing with them for 2018.
- Look at the titles and industries of those downloading your marketing content.
- Survey your clients. You can ask about past client satisfaction or even missed opportunities and include a question about their biggest goals for 2018.
An expert in channel marketing, sales enablement and lead generation, Erik Frantzen guides the Nurture Marketing team as president with a great strategic mind, passion and a unique ability to connect with people. Frantzen is a 20-year technology veteran, having spent nine of those years as director of business development at Alpine Computer Systems, a VAR 500 reseller in Boston.
Posted by Erik Frantzen on February 26, 2018 at 12:37 PM0 comments
What can Microsoft partners do differently in 2018 to make a business breakthrough? We put that question to 16 top experts, including ERIC RABINOWITZ, CEO/CMO, NURTURE MARKETING. For more tips on finding success in the Microsoft channel in 2018, read our full Marching Orders feature here.
While surfing there are three possibilities, and only one outcome is good. Be too early and you're womped against the beach. Too late and you miss the opportunity.
This year, 2018, is your catch-the-wave year. Why? The corporate tax rate is lower, the stock market is going gang busters, according to The New York Times nearly $3 trillion in profits could be repatriated, and Randstad counts a 3 million-position shortfall in IT jobs in the United States. IT spending will be increasing as many projects on hold will now be a "go project." Because IT is understaffed, your clients -- big, medium and small -- will be looking to Microsoft partners to pick up the slack.
So, here's your insight. To catch the wave, you need to be marketing. More specifically, digital marketing. Make it easy for these desperate clients to find you. Social selling, Web site refresh, pay-per-click (check out LinkedIn advertising, for example), Sales Navigator PointDrive, e-mail, SEO, marketing automation and Partner Center referrals should be your priorities.
Do it internally, or outsource it, but do it now. Avoid the womp, and catch your wave for an amazing 2018!
Eric Rabinowitz is the CEO/CMO of Nurture Marketing, a full-service marketing firm that helps companies build lasting relationships with their prospects and customers.
Posted by Eric Rabinowitz on February 26, 2018 at 12:35 PM0 comments
What can Microsoft partners do differently in 2018 to make a business breakthrough? We put that question to 16 top experts, including Karen Chastain, Director of Global Alliances and Partners, Episerver. For more tips on finding success in the Microsoft channel in 2018, read our full Marching Orders feature here.
With women in only one of four jobs in the technology industry, it's clear that there is still a need to educate, recruit and keep women in tech roles. But talking about it is not enough. Unless companies put real time and effort into supporting the women in technology movement, they will miss out on talent needed to grow their business.
Here are two simple areas where partners can get more involved in the moment: Join a women's organization and enable women within your company.
Perhaps the easiest step is to join a women's organization. There are many active and meaningful women-in-technology networks and groups that can help you stay current on news, participate in events and be part of the movement. Many of these groups are not commitment-based and will enable you to educate yourself on current challenges, solution areas, ideas on how you can further embrace the women in your company and recruit talented women to fill roles. A few that I suggest are IAMCP Women in Technology (#iamcpwit), Microsoft Women in Partner (#mswomeninpartner) and Women in Cloud(#womenincloud).
Surely, you have some talented women in your workforce already -- don't lose them! Encourage them to get involved in the networks I just listed, start an internal women's group, and even introduce a new initiative or event with your employees.
At Episerver, we have put forward a few initiatives to help promote women in technology. I'm most proud of Digital Ninety-Nines, a podcast series that highlights the work of women who are leading digital transformation in their fields. Our goal was to carry the theme through in other ways, like our annual user conference, Ascend. At the conference, we hosted an all-women panel, including women from analyst firms, partners and customers.
So, get started today, check out the networks and groups that are available to everyone. You don't have to be a woman to join!
Karen Chastain, a proven leader in alliance management among the largest technology partners, is the director of global alliances and partners at Episerver. With over 15 years of experience in partner relationship management, building channels, strategic business planning and marketing, Karen consistently delivers results within global and cross-functional programs by building mutually beneficial relationships with partners.
Posted by Karen Chastain on February 20, 2018 at 4:23 AM0 comments
What can Microsoft partners do differently in 2018 to make a business breakthrough? We put that question to 16 top experts, including BARB LEVISAY, CONTRIBUTING EDITOR, REDMOND CHANNEL PARTNER MAGAZINE. For more tips on finding success in the Microsoft channel in 2018, read our full Marching Orders feature here.
Microsoft partners are in a good place right now.
Technology spending is up. Customers are ready to embrace new technologies and are growing more comfortable with the cloud. Office 365 has hit its stride and promises even more opportunity for partners through a steady expansion of features. Everyone in your organization is probably as busy, and billable, as they can handle.
During the good times, it's easy to get caught up in the whirlwind and put off preparing for the next cycle. Profits feel good. Diverting billable resources to development is painful.
But this is the best time to make your next move: To build the differentiator that will help your organization survive when the market is saturated or technology spending nosedives.
There is no question that specialization is key to differentiation. Partners who invest in building expertise and IP in an industry or function reap rewards through higher margins and loyal customers. As the specialist, Microsoft is more likely to invite you into opportunities.
During these good times, allocate resources to prepare your business for the tougher times. The longer this upcycle lasts, the more time you have to build expertise and reputation in your segment.
Redmond Channel Partner Contributing Editor Barb Levisay blogs regularly on RCPmag.com about Service Trends and Diversity Wins.
Posted by Barb Levisay on February 20, 2018 at 4:54 AM0 comments