059: Billing Secrets You Need to Know Today

Running a profitable MSP remains an elusive goal for half the industry. Shocking statistics show that 25% of providers are barely breaking even, while another 25% lose money each year. Yet despite these sobering numbers, entrepreneurs continue entering the space, drawn by dreams of independence and growth.

So, what separates successful MSPs from those that struggle?

Too many rely on questionable sources—anonymous Reddit threads, outdated conference decks, or one-size-fits-all coaching programs that overlook the unique nuances of each business. A strategy that thrives in California might fail in Columbus, yet many providers try to transplant business models across vastly different markets.

Data-driven intelligence offers a better path. By analyzing billing patterns and consumption data across a wide range of MSPs, we can pinpoint what actually works—in specific contexts. Instead of recommending specific vendors, this approach highlights essential solution categories (like password management and documentation systems), while offering market-accurate guidance on pricing, bundling, and go-to-market strategies calibrated to your size, location, and client base.

The mission is clear: empower every MSP to succeed by replacing guesswork with proven insights. A $1.5 million business shouldn't follow a blueprint built for a $4 million operation. Growth requires precision—knowing exactly which services to add, how to package them, and what to charge in your market. When we move beyond generic advice to data-informed decisions, more MSPs shift from surviving to thriving—building real business value that goes far beyond just covering the bills.

Ready to stop guessing and start growing? Discover how your MSP can join the profitable half of the industry through evidence-based strategies tailored to your business reality.

Chapters

• 0:00 Billing Data Reveals Industry Economics
• 3:14 Creating Purpose-Driven Solutions
• 6:36 Answering Critical MSP Questions
• 9:06 Why 50% of MSPs Don't Profit
• 11:00 Customizing MSP Advice for Success

Transcript

Speaker 1: 0:00

When we're doing what we're doing sounds like you know, when we're doing billing, we're pulling in all this information about consumption, of what products and categories of products are being consumed and what quantities, and what are they being sold with and what are people paying for them and what are people charging for them. That starts to tell us the dynamic of how the economics of this industry work right. And so when somebody starts coming saying, hey, what is my stack, what should my stack be, we're not going to come out and say, oh, you should have this product from this company and this product from that. No, but we categorize everything and we can come back and say you need a product in password management, in documentation, an RMM, a PSA, and that's what you need to run your business on.

Speaker 2: 0:43

So, based off just what you said right there, my question for you is do you feel that what you're doing today is one of the ballsiest things you've done in regards to creating this right, this offering, trying to create this and like going? You know, before MSP we talk about MSP and you had a clear vision of what you're doing. We know we're easy to solve it, but the password manager thing, obviously you were a little bit ahead of the curve there.

Speaker 2: 1:08

quite a bit right, the things you're doing in the cloud base but man it fit a great, you know it fit a need, and then you get to move. So I mean I'm just curious like, do you think it's one of the baldest things you've done when it comes to yeah?

Speaker 1: 1:20

absolutely. It's totally the most ambitious, right. If we look at Passportal, it was not a purpose-driven company, and by purpose-driven, yeah, there was a purpose and a fit thing for it, but it was not like what change do I want to have on the world with this? It was not. I never want somebody to lose their job because of it was not that purpose, it was shit. People need to manage passwords. I'm going to build something that does that and they can pay for that, right, and it was never to seek to solve, you know, some fundamental challenge that the world faces. This one was, and still is, right. Again, we did not set out to hey, you have to reconcile billing so you can send invoices every month and not get client complaints. Make sure you're getting paid for everything. Um, it it was.

Speaker 1: 2:15

When I say I sifted through the reddit and stuff, it was the amount of questions being asked. Right, it was the questions of what, what do I need in my stack? What, what are the best solutions in my stack? Um, you know, and and hearing things like why certain solutions weren't the right solutions, and hearing things of what should I charge what? How should I bundle? How should I go to market? How fast are you growing? What's your profit? What's my business worth? All of these questions that can inform them to actually grow their business successfully and have a difference. Right? And when I looked at all those questions that were flowing and you read you know the stuff from service leadership that comes out and says that 50% of MSPs don't profit? Right, you got 25% that barely break even and 25% that lose money every year. That's a shit business, right? And back to the thing that everybody deserves an opportunity.

Speaker 1: 3:20

I firmly believe in our mission statement is to give every single company an opportunity to succeed in the it channel. Right, that's. That's what we want to be able to do is give every single company that chance, and the only way that we can do that, in our opinion, is to be able to give people answers to the questions that they have that are actually true is not being given by somebody behind some you know concealed name and screen name and avatar on an anonymous website. That could be. There's brilliant 19 year olds working in basements and garages, and that's why we've got the most valuable companies in the world today. But, as a company that I am right now, do I want to take advice from somebody at that age, new in this business, and not be able to discern who that person is compared to. Are they actually somebody at the helm of a business, of where I want to get to, that has actually gone through this stuff, this stuff, right?

Speaker 1: 4:24

And so when we're doing what we're doing sounds like you know when we're doing billing, we're pulling in all this information about consumption of what products and categories of products are being consumed and what quantities and what are they being sold with and what are, what are people paying for them and what are people charging for them. That starts to tell us the dynamic of how the economics of this industry work, right. And so when somebody starts coming saying, hey, what is my stack, what should my stack be, we're not going to come out and say, oh, you should have this product from this company and this product no, but we categorize everything and we can come back and say you need a product in password management, in documentation, an RMM, a PSA, and that's what you need to run your business on, right. And now you need to offer an email security solution and a password, you know, a credential management solution, and you need to offer a backup solution and all these other security monitoring tools and edr and everything else, and we can classify those. But now we can come back, because what's?

Speaker 1: 5:21

The very next question is well, how do I package that? Okay, well, here's the ones that should be packaged together because that's how the world is buying them today. Well, what should I charge for that? This is what you should charge for that, because that's what the market is bearing today. Right, and give them all the answers to the questions that they have, so that they don't have to go out and seek it and get some really bad advice that dwindles their company or, worse yet, speaks to a sales rep at a software vendor. I've run them and it's fine. They are not business experts, right.

Speaker 1: 5:53

And there was a LinkedIn post I commented on recently too, where you look at the conferences in this industry and the speakers of them. They're a channel manager or an account executive or whatever, and they're up there giving security advice and giving business advice and guidance and stuff like that. Sure, maybe some of the people that prepared the presentations had some of that to it. They're not experts to be delivering that information, and what happens is an MSP leaves that conference thinking I need to do X, y and Z, and this is all I have to do and everything else, and they bank on that and that's their livelihood, this is their largest asset, this is their future, their retirement right For them and their family.

Speaker 1: 6:36

And so for us to be able to build something that allows an MSP to come in with any question and just be told Right and have it based on not a guess, not from an expert. That was an expert 10 years ago, I shouldn't be telling you how to run an MSP today. I ran one Geez. I did that in 2016. I was out of it in 10 years ago. Yeah Right, it's a different world now. Sure, I can give you business advice all day long, but I can't tell you what the right stack is. I can't tell you what you should charge based on what we charge for managed services 10 years ago, sure Right.

Speaker 2: 7:13

So why, just curious, you said 50, 50% are losing money, 25% barely break it even or pay the bill. Why in the hell?

Speaker 1: 7:24

would anybody get in this business With those kind of stats? Exactly a problem, right, but it's because I don't want to crawl under a desk and do tech work to make somebody else rich. I don't want to be beholden to somebody else and have a boss. I don't want to. There isn't. Everybody starts a business and a breakeven business isn't a bad business necessarily, right. It's not a valuable business, right, but I can collect a salary. Business doesn't have to profit. I can collect a salary and I'm fine.

Speaker 2: 7:51

It can be a lifestyle and I've got something.

Speaker 1: 7:52

I've got a job, I've got things to do, I've got money coming in. I'm good and there's nothing wrong with that. But when you go out and you meet with hundreds and thousands of MSPs over the years, they're all eager to grow. They do want more right, more Right, and and they stay in it because they see the prospect, they see the opportunity. They're sold a bill of goods that, hey, this coach can get me there, hey, this thing can get me there, and they're paying out more money to do it. And I'm not saying it's snake oil and I'm not saying it's wrong.

Speaker 1: 8:22

But there is no one size fits all growth strategy or plan for an MSP, right, they come from different countries. They come from different. You know regions with different economic conditions and and you know drivers and verticals and you know business segments. Everything is different, right, and so there's not a one size fits all. And I might be a company that's working over in the UK taking advice from how something is working in California or in New York. That doesn't make any sense. I can be in the US. I should not be living in Columbus, ohio, doing services and an MSP and trying to replicate, yeah, what somebody in California or New York is doing. That is not going to work. I have a different, you know industry that drives the economy in that in that region. I have it's it's.

Speaker 1: 9:21

I can't buy a house for the same amount of money in Ohio that I can in California, but that is not a thing. So why would I be expected to run the exact same type of business in the exact same way at the exact same pricing with the exact same services? It doesn't match up that way. It just it's not. It's not paired and same for same. And so that's where we need to solve things for MSPs. Piece, so they understand what I can charge for certain services and what needs to be included in that and what the market will bear where I am Right, it needs to understand how my business is compared to even other businesses in my area.

Speaker 1: 10:01

Right, I'm not going to. I shouldn't take a recommendation for a company that would work for four million dollar revenue if I'm at one and a half. That doesn't make sense. Right? I can't go and take on all these new services if I only have this many clients. I don't get the same quantity of scale on volume and everything else. It's probably a better, different solution new service for me to bring on in a different category, to go with right, should I be selling a ton of cyber insurance right now? Or should I be selling security awareness training right now? Right, like what makes the most sense for the business with where they're at. So that's what it is for us, and my belief is that if we focus on that, we will help these companies become more profitable, or become profitable and build a sustainable, strong business that has a value beyond just paying a bill for that.

Speaker 2: 10:58

Hi, I'm Mark Thomas, founder and CEO of Current Tech Solutions and Cyber Guardians. We know business owners like you want to focus on growing your company, not worrying about IT problems or security threats on growing your company, not worrying about IT problems or security threats. That's where we come in. Our team uses AI to protect your business from cyber risks and keep everything running smoothly. If you're ready for peace of mind and a stronger future, reach out to us today. Let's secure and elevate your business together.