July 8, 2024 • 43 mins
Hear from Tim Clarkson, founder and managing director of OxygenIT, who shares his remarkable journey from struggling to surviving to thriving. Tim discusses the challenges of transitioning from accounting to IT, founding his MSP, and navigating severe financial hardships.
Learn how he turned his business around by focusing on financial transparency, team alignment, and operational efficiency. Tim's story is packed with practical insights and strategies that every Managed Service Provider (MSP) owner can use to build a resilient and successful business. Tune in to discover how to stop digging and start thriving.
Let us help you unlock your business's full potential.
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'Now that's it: Stories of MSP Success,' dives into the journeys of some of the trailblazers in our industry to find out how they used their passion for technology to help turn Managed Services into the thriving sector it is today.
Every episode is packed with the valuable insights, practical strategies, and inspiring anecdotes that lead our guests to the transformative moment when they knew….. Now, that's it.
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Speaker 1 (00:00):
One, two, three, four .
Welcome to Now that's itStories of MSP Success, where we
dive into the journeys of someof the trailblazers in our
industry to find out how theyused their passion for
technology to help turn managedservices into the thriving
sector it is today.
Speaker 2 (00:17):
Tim Clarkson, welcome to the Now that's it podcast.
I've really enjoyed speaking toseveral Australians on the pod,
but you're my first Kiwi, sowelcome.
Awesome, Good to be here.
Yeah, you and I got to spendsome time together in the Blue
Mountains outside of Sydneyseveral months ago.
It was summertime then,probably getting a little bit
(00:39):
colder now.
I think you just said it waszero overnight.
That's brisk Tim.
Speaker 1 (00:45):
Yeah, it's moving towards winter.
We've got some cold factscoming through.
Speaker 2 (00:48):
Yeah, crazy.
So you're the founder andmanaging director at Oxygen IT,
a service provider deliveringenterprise-level IT services to
small and mid-sized businessesin New Zealand.
Thank you for joining us.
I really appreciated getting toknow you over the last year.
I think most people that knowyou would say that you enjoy
talking about yourentrepreneurial journey.
(01:09):
That's the one thing I reallylike about you is you've always
shared.
If my story helps somebody else, then that's great.
Then that's why you tell it.
So thanks for telling us thestory today and we'll get right
into it.
So, as a young lad and very,very similar to many, uh, uh,
young, young individuals, youfinish university and you enter
(01:30):
the workforce.
But did I read this right?
You were going to school foraccounting and finance, but then
you started working withcomputers.
Speaker 1 (01:38):
Yeah, I came out in the captain degree in 91 92.
It was a recession, so I had ahalf-time job doing accounting
and got a 20-hour-a-week jobdoing IT and within about two
months I realized I was notgoing to be an accountant.
Well, maybe I would be, but Iwouldn't be successful.
I'd be in jail.
There's just no detail and mymind was around computers and I
(02:01):
left that, and that's where itstarted.
Speaker 2 (02:03):
That's great.
What did those early jobs inthe IT business, in the IT space
?
Speaker 1 (02:15):
what did they do to help set yourself up for a
career leading a business?
Well, one of my early ones is Ivery quickly progressed from an
engineer to an IT manager at ayoung age and one thing I found
there was I had a boss who wasnot a good boss and having a
boss like that at a very earlyage can be quite detrimental and
I realized it's like hismanagement style was not a style
I wanted to emulate anywhere.
Part of my business was comingto banging hands on desks and
(02:36):
shouting and yelling.
I'm like let's not getting thebest out of your people.
So I went through.
I went through that, then wentto work for a multinational
company, then moved back toChristchurch and worked for a
friend's business and from thereI realized at the age of 27, in
New Zealand we have a thingcalled an OE and so we went and
did our overseas experience.
It's supposed to be two years.
(02:58):
Eight years later, afterworking at Royal Bank of
Scotland and Shell, I came backto New Zealand to start my own
business Awesome.
Speaker 2 (03:07):
So you did some consulting early on.
I saw from your resume and isthat?
First of all, consulting is itsown bag of risks and everything
, but was that your first realexposure to what it might be
like to run a business someday?
Yeah well, I opened upconsulting before I left the UK,
your first real exposure towhat it might be like to run a
business someday.
Speaker 1 (03:24):
Yeah, well, I opened consulting before I left um the
uk.
So I found a couple of largerfirms who didn't have
representation in asia.
Pacific said hey, do you wantsomebody to do this work for you
?
And they jumped on us and I hadone small child at that time
and the second one on the waycame back and started consulting
.
And it was a grind.
It was every second week I wasaway overseas to bangkok, sydney
(03:47):
, installing systems, coveringsystems.
Um.
To the point where I was doingthat we started 2005, 2008.
The um gfc hit and I'm sittingthere going to my wife.
If I don't have some work byfriday, I've got to go get a job
.
Um, and then two days later wehad six months worth of work.
It's like wow.
(04:07):
And I just at that point I saidI can't care, I'm doing this,
this is it's.
It's like an.
It's like a great fixer teafirm with roller coasters.
You know we have a really goodmonth, so you and then you have
really bad months, and the badmonth you don't do anything, you
can't spend the money becauseyou don't know when the next
money's coming in.
So you can't prepare yourselffor the next good month.
So you're stuck in the cycle ofhighs and lows that is um what
(04:30):
we call it yep, it sure is.
Speaker 2 (04:33):
I've heard so many tell the stories about those,
those days and consulting, whereyou have a really good month
and then you might not have anyincome coming for a couple of
months and so, uh, more power toyou.
Congrats.
That is not my, my style andwasn't for me.
So tell me about oxygen it.
Why did you decide to to startoxygen it?
(04:53):
Oh, say, 19 years ago, I thinkit was, uh, and then what were
some of those early days liketim?
Speaker 1 (04:59):
well, I didn't start oxygen.
I actually started a smallbusiness system management
consulting okay, yep, and thismyself, and it was a consultant
path.
And then I brought on anemployee and then we even
brought.
I didn't start auctioneering.
I actually started a smallbusiness called system
management consulting Okay, yep,and that's myself, and it was a
consultant part.
And then I brought on anemployee and then I went and
bought another one-man bandbusiness and that was really
scary.
I put $100,000 on the table andsaid I'll buy you and it had no
(05:22):
, it was all break-fix.
It's was hard.
That was my start.
I was an engineer first ratherthan sales and marketing.
So the only way I knew to getcustomers was I thought if I'd
build it, they'll come, I'll doa great job.
It's just such a crock of shitthat doesn't work that way.
So it was a struggle Convertedthe customers from great fix and
then over the time, I brought abusiness to Sydney.
(05:42):
And then, over the time Ibrought a business to Sydney,
sold the business inChristchurch Oxygen IT.
So I brought that back around2000 after Christchurch
earthquakes, about 2012 or 13.
Sold the Australian business,focus on New Zealand and it's
just been that sense.
And it's a struggle with tryingto get past those pit hoses.
(06:04):
Small business owner, sure youknow, when you one or two, you
only got one or two staff.
You're going.
Okay, I'm, I'm really, reallybusy.
I'm working 60 hour weeks, 70hour week, but if I bring
somebody on now, I've got thatwage I'm actually not going to
take home a pay for the nextthree months or person on.
So that's, that's a hard thingand in my way around that was, I
just went and brought a coupleof businesses some success, some
(06:26):
not.
Speaker 2 (06:27):
But I was like actually, if I acquire the
engineers, acquire the income,that could be a bit easier
interesting so I think you hadtold us um in sydney that that
you had, you had built yourbusiness to about almost four
million in turnover and but youweren't happy because you
weren't profitable at the time.
(06:47):
So you talk a little bit aboutwhere that business was at that
point.
Speaker 1 (06:53):
Yeah.
So I ended up buying a businessa month after I signed the
contract, a month before we werein lockdown with COVID, and got
to delay that for months.
A month after we were inlockdown I took over a business
and that was a real hardstruggle to try and turn that
around.
I didn't look at the businessthrough the correct lens with
(07:13):
the knowledge I have now aboutrecurring revenues and customer
makeup and stuff like that.
So we struggled for quite awhile.
For me it was like revenue, getrevenue, get revenue, get
revenue.
And there wasn't theconsistency of knowledge around.
Actually, not all revenue isgood revenue, because some of it
comes from noisy customers,poor customers.
(07:34):
Some of it diverts you fromwhere you are, it's not focused
on exactly what you do, it'sjust a dollar.
As small business owners, wetend to do that that it's a
dollar.
I'll take it because that's gotto help me, not reason.
It cost you a dollar twenty,dollar thirty, a dollar fifty to
deliver that dollar.
Um, so we got to you, we gotclose to four million and then I
(07:55):
was really unhappy.
I was losing copious amounts ofmoney.
It was a ninety thousanddollars a month.
Um, because I had too muchsnark and right size hadn't
consolidated tech stacks.
Um, all these things that I nowknow in hindsight from gary
pico and robin robinson truemethods and enables courses and
all that stuff here's what youneed to do to be able to get
(08:18):
world-class figures and I wasreally happy.
I was sitting in a hotel roomgoing and sydney going next
month.
I don't know how I'm going tokeep the light on.
I'm losing money.
Why the hell am I working 16,18 hour days to do this?
So I got out the insurancepolicy and went well, will that
cover all the debts?
And as I did that, I justthought I'm not dumb.
(08:40):
I've got a degree inaccountancy.
I've run a business for 20years.
There's got to be a way to makethis work Right.
And I had a conversation with afriend.
He went it's easy.
You work out what you canafford to pay in salaries.
You draw yourself a weelifeboat and put some seats on
them and put some people intothat lifeboat.
You know, fill it up with theseats and if somebody doesn't
(09:06):
fit, they don't fit.
Because if you try to, you knowif you, if you I suppose that's
kind of my nature and I'd say alot of us in it is we're helpful
, we want to help other people,right, we want to do the right
thing.
There's very few of us who arecompletely self-centered.
Um, so you can well, how do Iput one more person in?
And he said my mate's like ifyou put one more person in,
everybody goes down.
Right, my mate's like if youput one more person in,
everybody goes down.
And the hard reality was allthose other people would go out
(09:28):
and get jobs tomorrow.
They're employees.
They'll be like that sucks.
But I'm a senior engineer.
Where's the next position as abusiness owner?
It's like a tornado comingthrough a small town in Iowa.
It leaves a lot of damagebehind you.
Don't just hop in your car anddrive to the next place.
Yeah.
Speaker 2 (09:46):
That had to be awful, tim.
I mean, you're obviouslythinking to yourself, man, I got
into this to be, you know, todo what's right, right and help
other people out.
And to your earlier point, youhad brought people on, and their
families, their lives, dependedon what you were delivering.
But you couldn't do that, andso you had to make a tough
(10:07):
decision.
You realize you're over staffand you had to start to lay some
people off, and so maybe talk alittle bit about what was sort
of your process to get out ofthat hole.
What were some of thosestrategies?
Obviously, writing the shipfrom a technical perspective,
getting the right stack in thereand hiring the right people, or
keeping the right people.
(10:27):
But what was that like to tryto work yourself out of that,
that hole?
Speaker 1 (10:32):
what was the meat?
I mean like, as much as you sayI can get rid of people is,
yeah, a few people self-selected.
So we had a meeting I saidhere's the situation.
I've tried to do this all bymyself and I think too many of
us.
As owners, we get very fearfulof discussing the figures and
profitability of the businessand the business with our staff
because they're gonna see oh youmake this much money, I want to
(10:53):
pay rose.
But what that leads to is allthese people didn't know the
position we're in, right, allthey saw, all they saw was the
consequence we couldn't pay thisbill.
We, this credit card didn't gothrough.
What the hell's going on, whichcaused enough nervousness.
So I sat down and just wentokay, here's the situation,
here's what we have to do.
Some people went well, I'm well, you know, there's one person
(11:14):
working for us and they puttheir hand up and said I'll go
get another job elsewhere.
I like you guys, I like thebusiness.
I'd love to be here, but if I'mhere here and the business
isn't here, I'll go, and we'restill keeping in contact.
So the first thing was get tozero.
My only goal in those first twoor three months was get to zero
.
If I've stopped losing money, Ithen have a runway where I can
(11:37):
think how do I make this better?
But if you're in a hole, stopfrigging, digging.
So we stopped digging, we cutexpenses.
We went to vendors and saidlook, hey, here's the situation.
We're screwed.
We've got a business, you losea customer.
But can I have three orsix-month kind of gratis period?
Or stop paying Like I'll turnyour service off?
(12:00):
It's not critical to thebusiness, I love it, but I don't
need it.
Some of them we keep it runningbecause hopefully you're here
in three or six months time usedto be a customer, absolutely so
.
Rationalization of services,cutting everything back that
wasn't critical.
Um, got me to zero.
Got to zero.
Then took the time and I sat inmy garage making gin over a
summer um, being a moonshiner.
(12:21):
Yeah, watching that still dripas I watched Gary Pico videos
and Robin Robin's videos and allthe stuff I could know.
Okay, here's what world classlooks like, here's what best of
class looks like.
Where are we?
And then working out the planwhat do we need to get there?
Okay, we've got three different.
Stop changing products becauseyou're a 19 engineer.
Oh, that Android looks reallygood.
Or that MDR looks really shiny,it's got this new feature makes
(12:44):
no difference.
Pick one, get everybody runningit, train your staff.
And that's where ouroperational numbers.
We were almost a ticket perendpoint and well over half an
hour per endpoint per month downto we're 0.3 of a ticket per
endpoint and we're doing about0.2 of an hour.
So those things make a hugedifference.
(13:05):
Um, at the same time I kind oflooked forward and went where's
automation going?
So, even though we're not ahuge business, I was like let's
get everything automated.
We can make my staff happier,less dependent on level one,
level two staff coming through.
Um.
So we put automation in to helpdrive those numbers down.
And I'll also say it's, it'snot just one thing.
(13:27):
So, as much as I'm going onabout operational, I'm like, no,
to run the business, you can'tjust do operations.
And so I'll get this goingreally well and then I'll be
marketing on the sales later andthen I'll do sales marketing
and then I'll do my hiringprocesses after that.
So as much as I fix operationnumbers, in hindsight I realized
I was absorbing a lot ofmarketing and sales information
(13:49):
at the same time.
To start slowly getting thatstuff out there, getting
operationally efficient isfantastic.
It will increase us from minus20% net profit to plus 20% net
profit.
That's amazing 20%, net profitof $10 is still only $2.
You have to take that $10 andmake it $1,000.
(14:10):
Yeah, but you don't want to gofrom minus 20% on $10 to $1,000.
To now I'm losing $200.
So you want to getoperationally efficient as quick
as possible Right, but you also, at the same time, have to
build up your sales andmarketing.
And people, people.
I caught in the same track forabout a year at 18 months.
(14:32):
Where's the easy button?
Yeah, yeah, I'll use anexternal lead generation company
.
Dang Yay, that's going to sortit.
I'll do this and I'll send outsome marketing.
And I didn't get 10 newcustomers.
So marketing is, as I'm comingto realize, is a one, two, even
(14:54):
three or four year process.
And I say don't aim forperfection.
You know you don't want to putout.
I watched this video and thisguy said you know you need to do
I wanted to do a YouTube kindof webinar type things.
He said your first one's goingto suck.
It can suck in three monthstime while you try and get it
perfect, or it can suck today.
And if, while you try and getit perfect, or it can suck today
(15:15):
, it sucks today, that one morestep towards getting good, so
three months times you'll have agood one, but rip that bandaid
off and something that'shorrible like our marketing
going out initially, absolutelyyuck.
Yeah, we weren't following upcorrectly, but it was going out
good, you have to just make astart that's's good.
Speaker 2 (15:33):
Yeah, I love that you mentioned.
Operational efficiency is sortof your foundation.
You want to get that rightfirst, but you can't stop there
Because there's no house to livein if you don't figure out, go
to market and all the rest.
So I love that you called thatout.
One of the other things thatyou mentioned, Tim, was that
(15:55):
when you went through thosetough times and you came to your
employees and said this is thesituation that you were in, a
lot of them were surprisedbecause you weren't as open with
your finances.
That's changed, hasn't it?
You're quite a bit more openwith your team.
Well, it was quite funny.
Speaker 1 (16:08):
I sit down with one of my guys He'll probably watch
this and he's about to movecities and I'm like I'll sponsor
you to move cities, do whateveryou need to do, don't want to
lose you and he consistentlysigns new contracts like I want
to pay you guys and I was justgobsmacked.
I'm like, no, I'm saying youdidn't deserve it.
He's a fantastic person and Ithink he deserves the money.
And my big mum going where thehell am this money from?
(16:29):
I'm struggling, you know, justcome down profitable.
I have creditors, all the otherstuff I'm paying off and I'm
trying to get the balance sheetin order of the cash balance so
that the business is healthy,I'm going yeah and then I I read
the great game of business, um,but and which is a highly
recommended um, this is a reallygood stuff you can pull out of
there.
(16:50):
So I sat down, I took them ontothe pub and said okay, here's a
napkin, write down how much youthink out of each dollar I get
to keep.
And one was 70 cents and oneperson was 50 cents.
And I went I wish.
And the average MSP?
Well, 23%.
Mfps lose money.
Yeah, I know, I was one of themat some point.
The average MSP is between8-10%, depending on who you
(17:12):
listen to.
And the guy after the race saidwhy would you do it?
I said what do you mean?
He said why would you gothrough all the effort you're
doing if you're only making 8%on those dollars?
I said you know, because we cando better.
We can get 20, 25, yeah, but weall have to do it together.
And after what he said to me, Ifelt sorry that I asked you for
that pay rise.
(17:33):
I said no, you were entitled toask and I'm entitled to say no,
but I'm entitled to say no bygiving you the facts, not just
saying no and looking like adouche.
It's like here's why.
And now he's got, you know, adecent pay rise kind of a year
later.
I'm like it's with the business.
The business will do what itcan do to support everybody, but
the business first and foremost, you've got to realize, has to
(17:54):
look after itself.
Yeah, and I see a lot ofnegative stuff sometimes on
youtube about people saying youknow businesses will throw you
out and they're not in it foryou and and I think it's maybe
some businesses, but at the endof it.
You know, if you give into oneperson, well you could lose nine
or ten people because thebusiness goes under.
So you don't you want that.
So now we do.
I try to do a quarterly, youknow, taking through a P&L
(18:18):
balance sheet cash flow.
I'm trying to work myaccountant to get him to come in
to run training courses.
So translate that into the P&Lis what you earn as an employee
and you pay your taxes.
The cash flow is what you haveleft over the end of each month
and the balance sheet is whatdoes your mortgage and your
assets look like?
Let's try and transposebusiness into personal financial
(18:39):
education, which america is thesame as new zealand.
It's woeful you go to a highschool and they teach you how to
count to 10, but they don'tteach you about compounded
interest and debt on creditcards and high purchase and all
the other stuff that derailsyour life.
Speaker 2 (18:53):
Yeah, I love that about you.
Tim is number one.
You see something that isn'tgoing so well and you look at it
as an opportunity, not as a Imean, even after everything
that's happened for you to saywe can do better.
I love that about yourpersonality.
And then the other piece of it,and so many MSPs that have read
the Great Game of Business andare clear, you know, or they're
(19:15):
open with their books.
They are educating their teams,just like you are, to be better
and better understand the innerworkings of the business.
Because, who knows, maybesomeday one of them takes over
for you and you're prepping themnow with that financial
know-how that they might notnormally have if they were just
an IT tech.
So really, really good stuffthat you're doing, tim.
(19:35):
Keep up the good work.
Speaker 1 (19:37):
The other thing from that was one of the checks came.
He said we're paying $1,000 amonth for this tool.
I went, yep.
He said I don't think we'regetting enough benefit from it.
We have to sell $8,000 a monthto pay for that $1,000.
Wow, the tool.
Because he said that's that'sthree new customers that they
bring on board, that bring onboard this year, because we can
save that piece of cost, becauseit's it's not doing the job we
(19:57):
need it to do.
Speaker 2 (19:58):
I'm like that's empowering yep, very good, very
good.
Yeah you, you've done somethingwell there.
So part of your coursecorrection was obviously taking
a look at parts of the businessthat you know, maybe parts of
your service offering thatdidn't fit and like the overall
goals of business, what you weredoing.
You were probably doing alittle too much of everything.
Can you talk a little bit aboutsome of those conversations and
(20:20):
maybe what you decided?
You were in business for once,that you are no longer in
business anymore.
Speaker 1 (20:25):
On yeah, so at the same time as we had these
financial struggles in thebusiness I got hacked about must
be coming up on four years agofinancial struggles in the
business um, I got hacked aboutmust be coming up on four years
ago.
Um, I brought a business, gavethe, the previous owner, access
to systems while doing thetransition he was 62, didn't
really care about security.
They got in, they hacked us,they encrypted our backups.
(20:48):
Um, I went, yes, so what?
Because I always expect that tohappen at some point.
So I had a second set ofcompletely separate backups,
restored it.
But it made me realize actually,if I'm hackable and I'm the MSP
, what's it like for customers?
And that's where we started oursecurity journey.
So that's when we got to thepoint where the two kind of came
(21:11):
together.
I'm sitting there going, I'mnot making enough money, I've
got all these wrong customers.
I need to do security better.
I can focus on that.
I'm going to have happiercustomers, less risk.
So we went through and got ridof a lot of customers I had.
I think I did the numbers Ican't remember exactly.
I had like 160 customers on thebook I was invoicing each month
(21:34):
for we are now down to 40customers, 24 contract customers
only.
But those customers I got ridof, like the 120 I got rid of
accounted for like 3% to 4% oftotal revenue.
Wow, but when I got rid of them, one of the engineers came to
me concerned.
I mean, what's going on?
The phone's all gone quiet.
(21:54):
They were concerned about theirjobs because we're down to like
three or four phone calls a day.
We do, on average, kind ofacross 600 endpoints.
We're doing like 15 to 20tickets a day.
Obviously numbers change right,right, conditional access, and
it blows out and comes back downagain.
But they're like what do we do?
You know the phones and ticketsaren't there.
I'm like we'll deliverexcellent service phone the
(22:17):
customers spend the time withthem, speak to them.
You know we're still making.
We're still making, but payingus to do a job.
Now we can actually do the jobfor those who are paying us
correctly.
So, rather than reacting to theperson who is break, fix ad hoc
, paying you two thousanddollars for subscriptions, like
they pick the phone up and saythis is broken, fix it now.
And the answer is well, why?
Well, because I'm paying you$2,000 for subscriptions.
They pick the phone up and saythis is broken, fix it now.
And the answer is well, why?
Well, because I'm paying you anhourly rate.
(22:37):
So I expect this done right now.
Where, when it was moving tocustomers who are managed
contractors Like we, will triageyour tickets and move you
through this correctly and whenyou have a major problem, we
will all hands on deck and we'lldeal, deal that in a timely
manner.
And we can't.
We have the staff and abilityto do that because that's what
you're paying us for.
And at the same time, weincreased our revenue quite a
(22:59):
large amount.
Um, I went, I looked at thefigures the other day.
I think we were went up byabout 60 70 percent on revenue
and more on profitability.
Um, by implementing propercyber security standards.
So saying the customers we havea minimum you need to meet Yep,
and the minimum de-risks bothbusinesses.
It de-risks your businessbecause you know we're doing the
(23:22):
bare minimum and it's a minimumright, it's a bare minimum to
keep you safe.
And it de-risks my businessbecause the chance of you being
hacked is substantially reduced.
So therefore, I'm not going toget to a book in one phone call
saying how to get up and runningand impacting the service
delivery for my other customers.
So I was laughing.
I'm just doing a new websitethat goes live in about yeah,
(23:43):
today, as we have this as athing, um, and one of the things
I'm going is for thosecustomers for being in business
and it is something I haven'ttold you which I'm quite proud
of For those customers who haveadhered to my security advice.
I have not had a cyber incidentfor 10 years.
That's great, very good.
I've had a ransomware attacktwo years ago.
(24:04):
I went to them six monthsbeforehand.
Here's our standard minimum youneed this.
No, no, we don't need it.
We're fine.
Got hacked, had another customerwho had email been breached
three times.
They're like you need this.
On the third one, we're like wehave to let you go.
You're not listening.
We just know no-transcript whoyou can service really well.
(24:27):
And that's Michael McCullough'sright.
The pumpkin plan.
I've read those books and allthose sorts of things.
Find the right customer.
We've now said the engineers.
It's like an email the otherday that I haven't seen it since
my draft book.
But like who's our top threecustomers by revenue?
Let the engineers understandwhen that phone call comes in
(24:49):
from those top customers, theytreat our top customer and then
who's the top three customers byengagement, not by revenue.
Who's the top three who we lovehearing from?
We hear them, we want to helpthem.
How long can we spend on thephone with them and sort their
problems?
Who's the bottom three?
And so, driving the business?
It's like, okay, well, theseare the bottom three.
Why?
Oh, they just had a bad,they've been having a bad month.
(25:17):
No, they're just not a rightfit.
Okay, so when we get more money, we move that, we move them on.
Because we went, I want, I wanteasiest content.
We can't find three disengagedcustomers, right?
Speaker 2 (25:21):
yeah, that's very good, it makes their job easy,
yeah yeah, that's really good,tim, and and that that is one of
those uh, steps of maturity.
Obviously you had you had hitrock bottom from a profitability
perspective years before this.
But when you can get to a spotwhere you say, hey, these
customers are actually costingus money, both time and money,
(25:43):
and so we need to find themanother home, right, we need to
fire them, find them anotherhome.
And, oh, by the way, it's freedup time for our techs to be
more proactive.
You're truly a managed serviceprovider now, tim, and you're
doing stuff that most customersdon't expect from their IT
company.
Right, to be able toproactively keep them up and
running and so really, reallypowerful.
(26:05):
The other thing that I heard youmention earlier was this mind
shift that you had to make thatrevenue wasn't the most
important thing.
It's important, butprofitability is the most
important thing, right, like,like you had to make sure.
Again back to the, theefficiency piece, but can you
talk about how difficult thatwas?
(26:26):
I mean, obviously you hadgotten to a spot where you
thought you were doing forreally well with 4 million in
turnover, but you're underwaterfrom a profitability perspective
.
But was it an overnight thingor was that still?
Did you have to convinceyourself on a daily, weekly
basis that make sure we're doing.
We're going after the rightcustomers, the right deals and
(26:46):
the revenue will come.
Speaker 1 (26:48):
For me it was an instant thing.
I was sitting in that hotelroom.
I went into Xero, I generatednumbers, I sorted them and we
okay, if it's just me lookingafter the business, who can I
service?
Great, okay, now, as I fillthat lifeboat up, okay, I'll
bring an engineer on to help me.
Okay, I can look after thesecustomers.
(27:08):
Okay, I need somebody to do thebillings.
I want to do some sales.
Okay, that's didn't give me anymore customers, but filled
another seat and I just wentthrough and went.
That's what I have to do,because I was in such a bad
position.
I didn't have the luxury of mynext six months.
Maybe I'll sign a contract andget out of this.
I'm like, if I don't sort thistonight, I can't go home back to
(27:28):
cross.
And then we put a quartermillion dollars back on the
house and financed the businessto get through it.
You know that was a few tearsin the family, so I'd suggest
you don't get to that positionfirst.
So I'm working with another MSP.
So one of my goals is to workwith MSPs, right?
So I've got two MSPs.
I'm working with two MSPs.
(27:50):
I'm working with one guy inaustralia and we're going
through going.
Okay, let's right size yourcustomer.
Let's right size your customerbase.
What's the revenue, what's theprofitability of them?
Okay, what are you doing forthese ones?
And he's gone through and gone.
Okay, I can get rid of thesefive customers, but it's
actually not going to unpick meat all.
I'm actually going to be betteroff.
Yep, and it's just, you don'thave to do it on one go, like,
(28:12):
if you are at 3% profitability,you have the luxury of time.
You can sit down and make aplan and discuss it with.
I'd say, find another, findsomebody you can discuss it with
.
So I discuss my business in toomuch detail, as you well know,
with too many other.
MSPs Cause I'm like I in toomuch detail, as you well know,
with too many other MSPs, so I'mlike I don't compete against
(28:32):
them.
Even in my local town I was atKaseya Conference met a
Christchurch MSP.
I don't think we've lostbusiness to each other in 10
years, so why would I beconcerned about telling you what
and how I'm doing?
But work out your plan on amethodology.
Now I have a methodology andI'm a really people go, you're
(28:53):
so innovative.
No, I don't have an innovativebone in my body.
I'm an imitator.
Yeah, I, uh, but imitate thebest and then tweak it for how
it works for you.
Um, and so I did that.
I got a methodology, wentthrough with this other msp,
said okay, okay, here's how youcalculate all the figures.
Here's how you calculate it ona methodology.
(29:15):
It gives you a ranking.
How do you feel about that?
And there might be somebodywho's an F customer, who you
think, well, I just can't firethem at the moment.
Well, you're going, okay, great, but that's a decision you've
made.
You haven't let it happen toyou.
You haven't let it get worse.
And it might be.
Look, I'm not charging enough,but they've given me $50,000
(29:37):
worth of contract revenue overthe last three years as
referrals.
So they're not paying for theservice but there's no redeeming
features.
Then find somebody.
So we have two businesspartners.
I have two other IT companies.
I go this customer doesn't fitfor me.
Now I'd like to hand them overto you.
They're like what do you wantfor us?
I don't want anything, I justwant you to look after them,
right?
Yep, because if you don't handthem off, it will come through
(30:00):
in your tone in your servicedesk manner as a leader you will
say to yourstaff.
Maybe we shouldn't be dealingwith that customer in this
manner.
That customer, after six months, will say your service has
dropped and they will leave youanyway.
Right, that's good.
It's not a case of fake it tillyou can't, fake it till you
make it, and that when you'vegot a customer who is truly not
(30:21):
the right fit for you, it's areverse.
You need to get rid of it, findfocus, have a conversation with
them, explain how you havemoved on, explain how their
business is slightly differentand, by the way, I found
somebody who I think could begood for you.
That's great.
Speaker 2 (30:41):
Tim, you've left me with a bunch of nuggets over the
last couple of months.
I call them Timisms, if youwill.
One of my favorite ones.
I want to share with everybody.
It's sales is not a dirty word.
Want to share with everybodyit's sales is not a dirty word.
I think you shared that with us.
Uh at at our event in uh in theblue mountains, because we were
talking about uh and thanks forthe reference to uh, an
american movie.
(31:01):
Uh, field of dreams.
It msp is not a field of dreams, right, it's.
You can't just go out there andsay, here it is, people will
come.
You got to get your butt outthere and you got to start
knocking on.
People will come.
You've got to get your butt outthere and you've got to start
knocking on doors and talking topeople.
So talk a little bit about yourmindset around sales.
Speaker 1 (31:19):
So I was an engineer and I thought and there's always
this comfort, so it's quitefunny, because I've got a
salesperson and he says this isone of the few SPs I've worked
at where there's no comfortbetween engineering and sales.
Is, this is one of the few SPSI've worked at where there's no
conflict between engineering andsales?
Engineers don't go, why thehell have they sold it?
Sales don't sell shit, and thatcomes from I was watching to
get myself into sales mindset.
I'm like sales is just a skill,so therefore you can learn it.
(31:42):
Therefore, it's four hours aday of videos.
Here's subscribing to RobinRobbins, gary Pico, galactic
Advisor, all these differentservices.
They'll get sales training.
It's like I would just put avideo on when I walk to work in
the morning at double speed, soI'd listen to an hour's video on
the way to work, an hour'svideo on the way home, an hour's
video where I walk the dogs.
I'd go for a walk around thepark for an hour and there's two
(32:06):
hours worth of videos.
It's like repetition,repetition, repetition.
And what that taught me waslike sales is only a dirty word
if you're trying to sell thewrong thing to the wrong person.
Sales isn't about selling.
It's about education andfinding the person who wants
what you have to deliver.
And if you can find that it'snot, isn't it?
(32:27):
I mean, look, we've lost somesales recently.
People go your price is tooexpensive.
I go well, that's the priceI've priced myself out to run a
profitable business, to stay inbusiness and deliver the service
that I believe you need.
Now, if that's not the serviceyou need, then there's other
people out there who willdeliver the service you need and
I have no problem with that.
I don't get upset, but I don'tget angry.
I'm like I go well, we'll seewhere they are in three years.
(32:49):
I know who they've gone to,then put them on the list, we'll
carry a marking to them, we'llfollow up with them and if
they've got what they want andthey're paying for what they
need which is less than whatthey want from me, fantastic.
By all good graces, go forwardand run a happy I want them to
run a happy business.
(33:13):
But if you try to sell the wrongthings to the wrong customer,
now that is sales and that'swhere it leaves a dirty.
You know dirty word?
I mean we have one customer,one prospect, who wanted to sign
up with us.
I just said, salesperson, no,we're not signing them like, but
it's five thousand dollars amonth.
I'm like, no, they, they're notthe right cultural fit for our
business.
They're going to cause problems.
Um, so for me it it was training, training, training, the
(33:33):
advantage that it's given me, asmy sales guy loves taking me on
sales calls now, even thoughI've been an engineer for coming
up on 30 years.
He said you don't revert toengineering, you don't risk
feeds and feeds and solutioning.
You're like I can look at whatthe customer's talking about, I
know how to solve it.
And my agent goes I've solvedthat, cool, move on.
How do I turn that intosomething?
(33:55):
I can explain to this businessowner or C-suite person that we
give them an outcome.
It's not about breaks, it's notabout managing the technology.
It's about delivering anoutcome to them that they can
quantify so that they can thensay, yes, we'll pay the premium
you want to charge, because weunderstand how you're different
and that you know I give thesales training right through the
(34:16):
whole business.
People may choose not to do itI mean engineers.
They really don't want to dothe sales training, but there's
a framework course we do thatexplains why we're different and
how we do what we do, so thatthey can sit in front of the
customer and understand, youknow, if the customer says, oh
you know our bill's too much,it's like, well, it's too much,
because here's what we're doingfor you.
(34:37):
We have all these differentdepartments who do different
things.
If you go to a one-man band andthere's nothing against one-man
bands, I was there and we havea need for them- and I've seen
(34:59):
some negative things in the past.
Speaker 2 (35:00):
They serve us a great job for the right customer, but
our price goes up as we delivermore, more departments awesome.
So, tim, you mentioned you havea 30 year short, a short it
career.
30 year it career, uh, and youhave experienced some things
that I think a lot of folkswould have never experienced.
But what would you tell youngtim when he was just about ready
to start his it career that youknow now that maybe you didn't
know that so I went throughschool and tried to get expelled
(35:23):
.
Speaker 1 (35:23):
They tried to expel me from school because I just
didn't really enjoy it.
I was like like I'd turn up andgo.
What are we taught the textbookat the end of the year I'm out
of here.
And so I lacked self-belief.
I failed English, I couldn'twrite really well.
That had a massive impact on myability to do sales.
So I didn't go down the salesroute because I couldn't write
(35:46):
proposals.
I'm like I'll be an engineerbecause if I pull this widget or
this lever, something happens.
It's easy, it's mathematicaland logical.
Um, if I was going back up,you're going like sales is.
Even if an engineer, sales isreally important.
How do you get your next job?
You have to sell somebody thatyou can do a good job.
You know, not just.
(36:07):
I got 99 on on the Cisco exam.
So if I had my way again when Ifirst started the business, I
would be back there going I'llgo and employ an engineer and I
will do sales.
Speaker 2 (36:20):
Awesome.
Speaker 1 (36:21):
And then marketing.
So I think the really big thingis I've got sales is
understanding marketing.
We as a business and industrywaste so much money on marketing
Yep, because we don'tunderstand it.
Speaker 2 (36:35):
We want somebody else to do it for us and we abdicate
it.
Speaker 1 (36:40):
Now I didn't say delegate, we abdicate.
I've paid you $4,000 a month.
I want some results.
Six months later, why haven't Igot the results?
I'm going to move to adifferent agency or try
something different.
Marketing doesn't work andmarketing is a lot harder than
sales, because sales is tangible.
I can go and knock on the doorand speak to Chris and say I won
the deal, didn't win the deal.
(37:00):
He liked me, didn't like me.
My price is too high.
It wasn't too high.
It's instant feedback and youcan put a really good process
for it.
That's quantifiable.
I found 100 people.
One person gave me anappointment out of 10
appointments.
I got four proposals out offour proposals.
I won one of them.
I have numbers once gone.
Well, business just do more ofthat.
(37:20):
Marketing is a field of dreams.
It is you, you.
You build it and you're hopingthey're going to turn up at some
point because it's reallyquantifiable.
There are some parts likegoogle ad words turn up at some
point, because it's reallyunquantifiable.
There are some parts likeGoogle AdWords.
You can get metrics, yep, butit's had to miss Like.
You might put a bad ad outthere and you might spend
$15,000 and get one lead, youchange your ad slightly, all of
(37:43):
a sudden you've got 100 leads.
So marketing, I think, issomething that, as MSPs, we need
to not stop abdicating.
We need to start actuallygetting involved in it, and you
can delegate it.
If you're really busy, you candelegate it.
Find a smart personal agency todelegate who's going to teach
(38:04):
you and walk you through it.
So, as a business owner, youcan make the decision.
You don't actually have to doall the work like print the
flyers and the newsletters andpost the ads.
I'm not saying you should dothat, but you have to have
metrics and be responsible forit yourself.
You can't just go I'm payingthis company 2500 a month, I'm
(38:24):
all good.
Yeah, so like seo, like I writeall my own blogs for for the
seo.
Um, until today, I post all thesocial media posts.
I review them all and know themall because it doesn't take too
long to do.
But I get all that contentdelivered to me.
Like the social media posts areformatted by somebody else, but
(38:45):
I'm picking.
I know what's going on in thebusiness.
Speaker 2 (38:49):
Very good, All right.
So I always I think I told youI was going to ask this question
.
The name of the podcast is theNow that's it podcast, Tim, and
so I'd love to ask you when didyou know?
Now that's it.
Speaker 1 (39:05):
And what sort of did I want to carry on doing IT?
Yeah, that you were yeah, yep, Ithink the funniest thing is I
sat in my garage and I told youI sat in my garage around just
before Christmas.
We've now got to profitability.
We're now growing above theindustry average of 10%.
You know we did 50% last yearof MRR increase.
(39:28):
I use that to get rid ofcustomers.
We're on target to do the sameagain this year.
Okay, well, now that's it.
What next?
And I went.
Actually, what I want to do ishelp other MSPs.
I'm not saying I'm perfect.
I'm not saying I've got all theanswers Hell, no, I'm so far
from that.
But what I am doing is going toyeah, I'm in three peer groups
(39:49):
Enable True Method, rub and Rub.
So I'm trying to gain all thisknowledge and tidbits.
I'm like, well, how can I helpother MSPs?
You know how can I haveconversations?
I mean I'm helping two at themoment, but I've also had
conversations with like three orfour more.
It's like let's have a look atyour books, let's have a.
You know how much help do youneed?
Do you want a?
Speaker 2 (40:09):
little bit of help.
Speaker 1 (40:09):
Do you want somebody to say, hey, ed boy, you're on
the right track.
Or do you want somebody to say,no, you really need to change
this?
But it also comes down to whatthey want to do.
You know what's the end goal,but for me, you know, I mean
(40:29):
after 30 years it's like whatnow?
What now?
Speaker 2 (40:31):
is how can I help other people?
I was hoping you'd say thatbecause that's something you
shared with us.
I think the first time we evermet and it's something that I
love MSPs that have gotten tothat point in their maturity
level where they've said, look,I've made some mistakes, I've
done some good things.
If my stories can help somebodyelse, I want to share it,
(40:53):
because this idea of MSPshelping MSPs is really really
powerful and that's what'sunique about our channel.
Is that?
Yeah, I mean we couldtechnically say we're
competitors with everybody, butwe're not.
I mean you've got folks in yourown community there that you
look at and say, look, I'll sendyou deals that aren't good fits
(41:14):
for me If they help you, great,like that's really really
powerful, tim.
Tim, I really want to thank youso much for joining the pod this
week.
You're an amazing individual.
I'm glad I got to know you.
I can't wait to see how OxygenIT continues to be profitable
and grows over the coming years.
I wish you and the Oxygen ITteam the absolute best of luck
(41:35):
in the future.
Thank you so much.
Speaker 1 (41:37):
Well, thanks for having me along and hopefully,
as I said, hopefully thisconversation can help another
MSP realize it's not all shit.
In closing you said abouthelping the community we are, we
do help like, we are veryhelpful.
So you just find the rightpeople and I put and rather
(41:58):
having a trying to close one newcustomer against a competitor
in my local market, I'd farrather go for a beer with them.
it's great having a beer withsomebody who understands the
struggles we go through becauseyou can't take it home to your
family?
You?
Can't take it home to yourbusiness partner.
You need somebody independentwho you can go have a beer and
go.
I've had a really shit week andthey go, let's have a chat
about that, but the shittycustomers.
(42:19):
Thanks for having me on boardand hopefully, um this helps
another usp up there.
Thanks so much, tim.
One, two, three, four .
Welcome to Now that's itStories of MSP Success, where we
dive into the journeys of someof the trailblazers in our
industry to find out how theyused their passion for
technology to help turn managedservices into the thriving
sector it is today.
Speaker 2 (00:17):
Tim Clarkson, welcome to the Now that's it podcast.
I've really enjoyed speaking toseveral Australians on the pod,
but you're my first Kiwi, sowelcome.
Awesome, Good to be here.
Yeah, you and I got to spendsome time together in the Blue
Mountains outside of Sydneyseveral months ago.
It was summertime then,probably getting a little bit
(00:39):
colder now.
I think you just said it waszero overnight.
That's brisk Tim.
Speaker 1 (00:45):
Yeah, it's moving towards winter.
We've got some cold factscoming through.
Speaker 2 (00:48):
Yeah, crazy.
So you're the founder andmanaging director at Oxygen IT,
a service provider deliveringenterprise-level IT services to
small and mid-sized businessesin New Zealand.
Thank you for joining us.
I really appreciated getting toknow you over the last year.
I think most people that knowyou would say that you enjoy
talking about yourentrepreneurial journey.
(01:09):
That's the one thing I reallylike about you is you've always
shared.
If my story helps somebody else, then that's great.
Then that's why you tell it.
So thanks for telling us thestory today and we'll get right
into it.
So, as a young lad and very,very similar to many, uh, uh,
young, young individuals, youfinish university and you enter
(01:30):
the workforce.
But did I read this right?
You were going to school foraccounting and finance, but then
you started working withcomputers.
Speaker 1 (01:38):
Yeah, I came out in the captain degree in 91 92.
It was a recession, so I had ahalf-time job doing accounting
and got a 20-hour-a-week jobdoing IT and within about two
months I realized I was notgoing to be an accountant.
Well, maybe I would be, but Iwouldn't be successful.
I'd be in jail.
There's just no detail and mymind was around computers and I
(02:01):
left that, and that's where itstarted.
Speaker 2 (02:03):
That's great.
What did those early jobs inthe IT business, in the IT space
?
Speaker 1 (02:15):
what did they do to help set yourself up for a
career leading a business?
Well, one of my early ones is Ivery quickly progressed from an
engineer to an IT manager at ayoung age and one thing I found
there was I had a boss who wasnot a good boss and having a
boss like that at a very earlyage can be quite detrimental and
I realized it's like hismanagement style was not a style
I wanted to emulate anywhere.
Part of my business was comingto banging hands on desks and
(02:36):
shouting and yelling.
I'm like let's not getting thebest out of your people.
So I went through.
I went through that, then wentto work for a multinational
company, then moved back toChristchurch and worked for a
friend's business and from thereI realized at the age of 27, in
New Zealand we have a thingcalled an OE and so we went and
did our overseas experience.
It's supposed to be two years.
(02:58):
Eight years later, afterworking at Royal Bank of
Scotland and Shell, I came backto New Zealand to start my own
business Awesome.
Speaker 2 (03:07):
So you did some consulting early on.
I saw from your resume and isthat?
First of all, consulting is itsown bag of risks and everything
, but was that your first realexposure to what it might be
like to run a business someday?
Yeah well, I opened upconsulting before I left the UK,
your first real exposure towhat it might be like to run a
business someday.
Speaker 1 (03:24):
Yeah, well, I opened consulting before I left um the
uk.
So I found a couple of largerfirms who didn't have
representation in asia.
Pacific said hey, do you wantsomebody to do this work for you
?
And they jumped on us and I hadone small child at that time
and the second one on the waycame back and started consulting
.
And it was a grind.
It was every second week I wasaway overseas to bangkok, sydney
(03:47):
, installing systems, coveringsystems.
Um.
To the point where I was doingthat we started 2005, 2008.
The um gfc hit and I'm sittingthere going to my wife.
If I don't have some work byfriday, I've got to go get a job
.
Um, and then two days later wehad six months worth of work.
It's like wow.
(04:07):
And I just at that point I saidI can't care, I'm doing this,
this is it's.
It's like an.
It's like a great fixer teafirm with roller coasters.
You know we have a really goodmonth, so you and then you have
really bad months, and the badmonth you don't do anything, you
can't spend the money becauseyou don't know when the next
money's coming in.
So you can't prepare yourselffor the next good month.
So you're stuck in the cycle ofhighs and lows that is um what
(04:30):
we call it yep, it sure is.
Speaker 2 (04:33):
I've heard so many tell the stories about those,
those days and consulting, whereyou have a really good month
and then you might not have anyincome coming for a couple of
months and so, uh, more power toyou.
Congrats.
That is not my, my style andwasn't for me.
So tell me about oxygen it.
Why did you decide to to startoxygen it?
(04:53):
Oh, say, 19 years ago, I thinkit was, uh, and then what were
some of those early days liketim?
Speaker 1 (04:59):
well, I didn't start oxygen.
I actually started a smallbusiness system management
consulting okay, yep, and thismyself, and it was a consultant
path.
And then I brought on anemployee and then we even
brought.
I didn't start auctioneering.
I actually started a smallbusiness called system
management consulting Okay, yep,and that's myself, and it was a
consultant part.
And then I brought on anemployee and then I went and
bought another one-man bandbusiness and that was really
scary.
I put $100,000 on the table andsaid I'll buy you and it had no
(05:22):
, it was all break-fix.
It's was hard.
That was my start.
I was an engineer first ratherthan sales and marketing.
So the only way I knew to getcustomers was I thought if I'd
build it, they'll come, I'll doa great job.
It's just such a crock of shitthat doesn't work that way.
So it was a struggle Convertedthe customers from great fix and
then over the time, I brought abusiness to Sydney.
(05:42):
And then, over the time Ibrought a business to Sydney,
sold the business inChristchurch Oxygen IT.
So I brought that back around2000 after Christchurch
earthquakes, about 2012 or 13.
Sold the Australian business,focus on New Zealand and it's
just been that sense.
And it's a struggle with tryingto get past those pit hoses.
(06:04):
Small business owner, sure youknow, when you one or two, you
only got one or two staff.
You're going.
Okay, I'm, I'm really, reallybusy.
I'm working 60 hour weeks, 70hour week, but if I bring
somebody on now, I've got thatwage I'm actually not going to
take home a pay for the nextthree months or person on.
So that's, that's a hard thingand in my way around that was, I
just went and brought a coupleof businesses some success, some
(06:26):
not.
Speaker 2 (06:27):
But I was like actually, if I acquire the
engineers, acquire the income,that could be a bit easier
interesting so I think you hadtold us um in sydney that that
you had, you had built yourbusiness to about almost four
million in turnover and but youweren't happy because you
weren't profitable at the time.
(06:47):
So you talk a little bit aboutwhere that business was at that
point.
Speaker 1 (06:53):
Yeah.
So I ended up buying a businessa month after I signed the
contract, a month before we werein lockdown with COVID, and got
to delay that for months.
A month after we were inlockdown I took over a business
and that was a real hardstruggle to try and turn that
around.
I didn't look at the businessthrough the correct lens with
(07:13):
the knowledge I have now aboutrecurring revenues and customer
makeup and stuff like that.
So we struggled for quite awhile.
For me it was like revenue, getrevenue, get revenue, get
revenue.
And there wasn't theconsistency of knowledge around.
Actually, not all revenue isgood revenue, because some of it
comes from noisy customers,poor customers.
(07:34):
Some of it diverts you fromwhere you are, it's not focused
on exactly what you do, it'sjust a dollar.
As small business owners, wetend to do that that it's a
dollar.
I'll take it because that's gotto help me, not reason.
It cost you a dollar twenty,dollar thirty, a dollar fifty to
deliver that dollar.
Um, so we got to you, we gotclose to four million and then I
(07:55):
was really unhappy.
I was losing copious amounts ofmoney.
It was a ninety thousanddollars a month.
Um, because I had too muchsnark and right size hadn't
consolidated tech stacks.
Um, all these things that I nowknow in hindsight from gary
pico and robin robinson truemethods and enables courses and
all that stuff here's what youneed to do to be able to get
(08:18):
world-class figures and I wasreally happy.
I was sitting in a hotel roomgoing and sydney going next
month.
I don't know how I'm going tokeep the light on.
I'm losing money.
Why the hell am I working 16,18 hour days to do this?
So I got out the insurancepolicy and went well, will that
cover all the debts?
And as I did that, I justthought I'm not dumb.
(08:40):
I've got a degree inaccountancy.
I've run a business for 20years.
There's got to be a way to makethis work Right.
And I had a conversation with afriend.
He went it's easy.
You work out what you canafford to pay in salaries.
You draw yourself a weelifeboat and put some seats on
them and put some people intothat lifeboat.
You know, fill it up with theseats and if somebody doesn't
(09:06):
fit, they don't fit.
Because if you try to, you knowif you, if you I suppose that's
kind of my nature and I'd say alot of us in it is we're helpful
, we want to help other people,right, we want to do the right
thing.
There's very few of us who arecompletely self-centered.
Um, so you can well, how do Iput one more person in?
And he said my mate's like ifyou put one more person in,
everybody goes down.
Right, my mate's like if youput one more person in,
everybody goes down.
And the hard reality was allthose other people would go out
(09:28):
and get jobs tomorrow.
They're employees.
They'll be like that sucks.
But I'm a senior engineer.
Where's the next position as abusiness owner?
It's like a tornado comingthrough a small town in Iowa.
It leaves a lot of damagebehind you.
Don't just hop in your car anddrive to the next place.
Yeah.
Speaker 2 (09:46):
That had to be awful, tim.
I mean, you're obviouslythinking to yourself, man, I got
into this to be, you know, todo what's right, right and help
other people out.
And to your earlier point, youhad brought people on, and their
families, their lives, dependedon what you were delivering.
But you couldn't do that, andso you had to make a tough
(10:07):
decision.
You realize you're over staffand you had to start to lay some
people off, and so maybe talk alittle bit about what was sort
of your process to get out ofthat hole.
What were some of thosestrategies?
Obviously, writing the shipfrom a technical perspective,
getting the right stack in thereand hiring the right people, or
keeping the right people.
(10:27):
But what was that like to tryto work yourself out of that,
that hole?
Speaker 1 (10:32):
what was the meat?
I mean like, as much as you sayI can get rid of people is,
yeah, a few people self-selected.
So we had a meeting I saidhere's the situation.
I've tried to do this all bymyself and I think too many of
us.
As owners, we get very fearfulof discussing the figures and
profitability of the businessand the business with our staff
because they're gonna see oh youmake this much money, I want to
(10:53):
pay rose.
But what that leads to is allthese people didn't know the
position we're in, right, allthey saw, all they saw was the
consequence we couldn't pay thisbill.
We, this credit card didn't gothrough.
What the hell's going on, whichcaused enough nervousness.
So I sat down and just wentokay, here's the situation,
here's what we have to do.
Some people went well, I'm well, you know, there's one person
(11:14):
working for us and they puttheir hand up and said I'll go
get another job elsewhere.
I like you guys, I like thebusiness.
I'd love to be here, but if I'mhere here and the business
isn't here, I'll go, and we'restill keeping in contact.
So the first thing was get tozero.
My only goal in those first twoor three months was get to zero
.
If I've stopped losing money, Ithen have a runway where I can
(11:37):
think how do I make this better?
But if you're in a hole, stopfrigging, digging.
So we stopped digging, we cutexpenses.
We went to vendors and saidlook, hey, here's the situation.
We're screwed.
We've got a business, you losea customer.
But can I have three orsix-month kind of gratis period?
Or stop paying Like I'll turnyour service off?
(12:00):
It's not critical to thebusiness, I love it, but I don't
need it.
Some of them we keep it runningbecause hopefully you're here
in three or six months time usedto be a customer, absolutely so
.
Rationalization of services,cutting everything back that
wasn't critical.
Um, got me to zero.
Got to zero.
Then took the time and I sat inmy garage making gin over a
summer um, being a moonshiner.
(12:21):
Yeah, watching that still dripas I watched Gary Pico videos
and Robin Robin's videos and allthe stuff I could know.
Okay, here's what world classlooks like, here's what best of
class looks like.
Where are we?
And then working out the planwhat do we need to get there?
Okay, we've got three different.
Stop changing products becauseyou're a 19 engineer.
Oh, that Android looks reallygood.
Or that MDR looks really shiny,it's got this new feature makes
(12:44):
no difference.
Pick one, get everybody runningit, train your staff.
And that's where ouroperational numbers.
We were almost a ticket perendpoint and well over half an
hour per endpoint per month downto we're 0.3 of a ticket per
endpoint and we're doing about0.2 of an hour.
So those things make a hugedifference.
(13:05):
Um, at the same time I kind oflooked forward and went where's
automation going?
So, even though we're not ahuge business, I was like let's
get everything automated.
We can make my staff happier,less dependent on level one,
level two staff coming through.
Um.
So we put automation in to helpdrive those numbers down.
And I'll also say it's, it'snot just one thing.
(13:27):
So, as much as I'm going onabout operational, I'm like, no,
to run the business, you can'tjust do operations.
And so I'll get this goingreally well and then I'll be
marketing on the sales later andthen I'll do sales marketing
and then I'll do my hiringprocesses after that.
So as much as I fix operationnumbers, in hindsight I realized
I was absorbing a lot ofmarketing and sales information
(13:49):
at the same time.
To start slowly getting thatstuff out there, getting
operationally efficient isfantastic.
It will increase us from minus20% net profit to plus 20% net
profit.
That's amazing 20%, net profitof $10 is still only $2.
You have to take that $10 andmake it $1,000.
(14:10):
Yeah, but you don't want to gofrom minus 20% on $10 to $1,000.
To now I'm losing $200.
So you want to getoperationally efficient as quick
as possible Right, but you also, at the same time, have to
build up your sales andmarketing.
And people, people.
I caught in the same track forabout a year at 18 months.
(14:32):
Where's the easy button?
Yeah, yeah, I'll use anexternal lead generation company
.
Dang Yay, that's going to sortit.
I'll do this and I'll send outsome marketing.
And I didn't get 10 newcustomers.
So marketing is, as I'm comingto realize, is a one, two, even
(14:54):
three or four year process.
And I say don't aim forperfection.
You know you don't want to putout.
I watched this video and thisguy said you know you need to do
I wanted to do a YouTube kindof webinar type things.
He said your first one's goingto suck.
It can suck in three monthstime while you try and get it
perfect, or it can suck today.
And if, while you try and getit perfect, or it can suck today
(15:15):
, it sucks today, that one morestep towards getting good, so
three months times you'll have agood one, but rip that bandaid
off and something that'shorrible like our marketing
going out initially, absolutelyyuck.
Yeah, we weren't following upcorrectly, but it was going out
good, you have to just make astart that's's good.
Speaker 2 (15:33):
Yeah, I love that you mentioned.
Operational efficiency is sortof your foundation.
You want to get that rightfirst, but you can't stop there
Because there's no house to livein if you don't figure out, go
to market and all the rest.
So I love that you called thatout.
One of the other things thatyou mentioned, Tim, was that
(15:55):
when you went through thosetough times and you came to your
employees and said this is thesituation that you were in, a
lot of them were surprisedbecause you weren't as open with
your finances.
That's changed, hasn't it?
You're quite a bit more openwith your team.
Well, it was quite funny.
Speaker 1 (16:08):
I sit down with one of my guys He'll probably watch
this and he's about to movecities and I'm like I'll sponsor
you to move cities, do whateveryou need to do, don't want to
lose you and he consistentlysigns new contracts like I want
to pay you guys and I was justgobsmacked.
I'm like, no, I'm saying youdidn't deserve it.
He's a fantastic person and Ithink he deserves the money.
And my big mum going where thehell am this money from?
(16:29):
I'm struggling, you know, justcome down profitable.
I have creditors, all the otherstuff I'm paying off and I'm
trying to get the balance sheetin order of the cash balance so
that the business is healthy,I'm going yeah and then I I read
the great game of business, um,but and which is a highly
recommended um, this is a reallygood stuff you can pull out of
there.
(16:50):
So I sat down, I took them ontothe pub and said okay, here's a
napkin, write down how much youthink out of each dollar I get
to keep.
And one was 70 cents and oneperson was 50 cents.
And I went I wish.
And the average MSP?
Well, 23%.
Mfps lose money.
Yeah, I know, I was one of themat some point.
The average MSP is between8-10%, depending on who you
(17:12):
listen to.
And the guy after the race saidwhy would you do it?
I said what do you mean?
He said why would you gothrough all the effort you're
doing if you're only making 8%on those dollars?
I said you know, because we cando better.
We can get 20, 25, yeah, but weall have to do it together.
And after what he said to me, Ifelt sorry that I asked you for
that pay rise.
(17:33):
I said no, you were entitled toask and I'm entitled to say no,
but I'm entitled to say no bygiving you the facts, not just
saying no and looking like adouche.
It's like here's why.
And now he's got, you know, adecent pay rise kind of a year
later.
I'm like it's with the business.
The business will do what itcan do to support everybody, but
the business first and foremost, you've got to realize, has to
(17:54):
look after itself.
Yeah, and I see a lot ofnegative stuff sometimes on
youtube about people saying youknow businesses will throw you
out and they're not in it foryou and and I think it's maybe
some businesses, but at the endof it.
You know, if you give into oneperson, well you could lose nine
or ten people because thebusiness goes under.
So you don't you want that.
So now we do.
I try to do a quarterly, youknow, taking through a P&L
(18:18):
balance sheet cash flow.
I'm trying to work myaccountant to get him to come in
to run training courses.
So translate that into the P&Lis what you earn as an employee
and you pay your taxes.
The cash flow is what you haveleft over the end of each month
and the balance sheet is whatdoes your mortgage and your
assets look like?
Let's try and transposebusiness into personal financial
(18:39):
education, which america is thesame as new zealand.
It's woeful you go to a highschool and they teach you how to
count to 10, but they don'tteach you about compounded
interest and debt on creditcards and high purchase and all
the other stuff that derailsyour life.
Speaker 2 (18:53):
Yeah, I love that about you.
Tim is number one.
You see something that isn'tgoing so well and you look at it
as an opportunity, not as a Imean, even after everything
that's happened for you to saywe can do better.
I love that about yourpersonality.
And then the other piece of it,and so many MSPs that have read
the Great Game of Business andare clear, you know, or they're
(19:15):
open with their books.
They are educating their teams,just like you are, to be better
and better understand the innerworkings of the business.
Because, who knows, maybesomeday one of them takes over
for you and you're prepping themnow with that financial
know-how that they might notnormally have if they were just
an IT tech.
So really, really good stuffthat you're doing, tim.
(19:35):
Keep up the good work.
Speaker 1 (19:37):
The other thing from that was one of the checks came.
He said we're paying $1,000 amonth for this tool.
I went, yep.
He said I don't think we'regetting enough benefit from it.
We have to sell $8,000 a monthto pay for that $1,000.
Wow, the tool.
Because he said that's that'sthree new customers that they
bring on board, that bring onboard this year, because we can
save that piece of cost, becauseit's it's not doing the job we
(19:57):
need it to do.
Speaker 2 (19:58):
I'm like that's empowering yep, very good, very
good.
Yeah you, you've done somethingwell there.
So part of your coursecorrection was obviously taking
a look at parts of the businessthat you know, maybe parts of
your service offering thatdidn't fit and like the overall
goals of business, what you weredoing.
You were probably doing alittle too much of everything.
Can you talk a little bit aboutsome of those conversations and
(20:20):
maybe what you decided?
You were in business for once,that you are no longer in
business anymore.
Speaker 1 (20:25):
On yeah, so at the same time as we had these
financial struggles in thebusiness I got hacked about must
be coming up on four years agofinancial struggles in the
business um, I got hacked aboutmust be coming up on four years
ago.
Um, I brought a business, gavethe, the previous owner, access
to systems while doing thetransition he was 62, didn't
really care about security.
They got in, they hacked us,they encrypted our backups.
(20:48):
Um, I went, yes, so what?
Because I always expect that tohappen at some point.
So I had a second set ofcompletely separate backups,
restored it.
But it made me realize actually,if I'm hackable and I'm the MSP
, what's it like for customers?
And that's where we started oursecurity journey.
So that's when we got to thepoint where the two kind of came
(21:11):
together.
I'm sitting there going, I'mnot making enough money, I've
got all these wrong customers.
I need to do security better.
I can focus on that.
I'm going to have happiercustomers, less risk.
So we went through and got ridof a lot of customers I had.
I think I did the numbers Ican't remember exactly.
I had like 160 customers on thebook I was invoicing each month
(21:34):
for we are now down to 40customers, 24 contract customers
only.
But those customers I got ridof, like the 120 I got rid of
accounted for like 3% to 4% oftotal revenue.
Wow, but when I got rid of them, one of the engineers came to
me concerned.
I mean, what's going on?
The phone's all gone quiet.
(21:54):
They were concerned about theirjobs because we're down to like
three or four phone calls a day.
We do, on average, kind ofacross 600 endpoints.
We're doing like 15 to 20tickets a day.
Obviously numbers change right,right, conditional access, and
it blows out and comes back downagain.
But they're like what do we do?
You know the phones and ticketsaren't there.
I'm like we'll deliverexcellent service phone the
(22:17):
customers spend the time withthem, speak to them.
You know we're still making.
We're still making, but payingus to do a job.
Now we can actually do the jobfor those who are paying us
correctly.
So, rather than reacting to theperson who is break, fix ad hoc
, paying you two thousanddollars for subscriptions, like
they pick the phone up and saythis is broken, fix it now.
And the answer is well, why?
Well, because I'm paying you$2,000 for subscriptions.
They pick the phone up and saythis is broken, fix it now.
And the answer is well, why?
Well, because I'm paying you anhourly rate.
(22:37):
So I expect this done right now.
Where, when it was moving tocustomers who are managed
contractors Like we, will triageyour tickets and move you
through this correctly and whenyou have a major problem, we
will all hands on deck and we'lldeal, deal that in a timely
manner.
And we can't.
We have the staff and abilityto do that because that's what
you're paying us for.
And at the same time, weincreased our revenue quite a
(22:59):
large amount.
Um, I went, I looked at thefigures the other day.
I think we were went up byabout 60 70 percent on revenue
and more on profitability.
Um, by implementing propercyber security standards.
So saying the customers we havea minimum you need to meet Yep,
and the minimum de-risks bothbusinesses.
It de-risks your businessbecause you know we're doing the
(23:22):
bare minimum and it's a minimumright, it's a bare minimum to
keep you safe.
And it de-risks my businessbecause the chance of you being
hacked is substantially reduced.
So therefore, I'm not going toget to a book in one phone call
saying how to get up and runningand impacting the service
delivery for my other customers.
So I was laughing.
I'm just doing a new websitethat goes live in about yeah,
(23:43):
today, as we have this as athing, um, and one of the things
I'm going is for thosecustomers for being in business
and it is something I haven'ttold you which I'm quite proud
of For those customers who haveadhered to my security advice.
I have not had a cyber incidentfor 10 years.
That's great, very good.
I've had a ransomware attacktwo years ago.
(24:04):
I went to them six monthsbeforehand.
Here's our standard minimum youneed this.
No, no, we don't need it.
We're fine.
Got hacked, had another customerwho had email been breached
three times.
They're like you need this.
On the third one, we're like wehave to let you go.
You're not listening.
We just know no-transcript whoyou can service really well.
(24:27):
And that's Michael McCullough'sright.
The pumpkin plan.
I've read those books and allthose sorts of things.
Find the right customer.
We've now said the engineers.
It's like an email the otherday that I haven't seen it since
my draft book.
But like who's our top threecustomers by revenue?
Let the engineers understandwhen that phone call comes in
(24:49):
from those top customers, theytreat our top customer and then
who's the top three customers byengagement, not by revenue.
Who's the top three who we lovehearing from?
We hear them, we want to helpthem.
How long can we spend on thephone with them and sort their
problems?
Who's the bottom three?
And so, driving the business?
It's like, okay, well, theseare the bottom three.
Why?
Oh, they just had a bad,they've been having a bad month.
(25:17):
No, they're just not a rightfit.
Okay, so when we get more money, we move that, we move them on.
Because we went, I want, I wanteasiest content.
We can't find three disengagedcustomers, right?
Speaker 2 (25:21):
yeah, that's very good, it makes their job easy,
yeah yeah, that's really good,tim, and and that that is one of
those uh, steps of maturity.
Obviously you had you had hitrock bottom from a profitability
perspective years before this.
But when you can get to a spotwhere you say, hey, these
customers are actually costingus money, both time and money,
(25:43):
and so we need to find themanother home, right, we need to
fire them, find them anotherhome.
And, oh, by the way, it's freedup time for our techs to be
more proactive.
You're truly a managed serviceprovider now, tim, and you're
doing stuff that most customersdon't expect from their IT
company.
Right, to be able toproactively keep them up and
running and so really, reallypowerful.
(26:05):
The other thing that I heard youmention earlier was this mind
shift that you had to make thatrevenue wasn't the most
important thing.
It's important, butprofitability is the most
important thing, right, like,like you had to make sure.
Again back to the, theefficiency piece, but can you
talk about how difficult thatwas?
(26:26):
I mean, obviously you hadgotten to a spot where you
thought you were doing forreally well with 4 million in
turnover, but you're underwaterfrom a profitability perspective
.
But was it an overnight thingor was that still?
Did you have to convinceyourself on a daily, weekly
basis that make sure we're doing.
We're going after the rightcustomers, the right deals and
(26:46):
the revenue will come.
Speaker 1 (26:48):
For me it was an instant thing.
I was sitting in that hotelroom.
I went into Xero, I generatednumbers, I sorted them and we
okay, if it's just me lookingafter the business, who can I
service?
Great, okay, now, as I fillthat lifeboat up, okay, I'll
bring an engineer on to help me.
Okay, I can look after thesecustomers.
(27:08):
Okay, I need somebody to do thebillings.
I want to do some sales.
Okay, that's didn't give me anymore customers, but filled
another seat and I just wentthrough and went.
That's what I have to do,because I was in such a bad
position.
I didn't have the luxury of mynext six months.
Maybe I'll sign a contract andget out of this.
I'm like, if I don't sort thistonight, I can't go home back to
(27:28):
cross.
And then we put a quartermillion dollars back on the
house and financed the businessto get through it.
You know that was a few tearsin the family, so I'd suggest
you don't get to that positionfirst.
So I'm working with another MSP.
So one of my goals is to workwith MSPs, right?
So I've got two MSPs.
I'm working with two MSPs.
(27:50):
I'm working with one guy inaustralia and we're going
through going.
Okay, let's right size yourcustomer.
Let's right size your customerbase.
What's the revenue, what's theprofitability of them?
Okay, what are you doing forthese ones?
And he's gone through and gone.
Okay, I can get rid of thesefive customers, but it's
actually not going to unpick meat all.
I'm actually going to be betteroff.
Yep, and it's just, you don'thave to do it on one go, like,
(28:12):
if you are at 3% profitability,you have the luxury of time.
You can sit down and make aplan and discuss it with.
I'd say, find another, findsomebody you can discuss it with
.
So I discuss my business in toomuch detail, as you well know,
with too many other.
MSPs Cause I'm like I in toomuch detail, as you well know,
with too many other MSPs, so I'mlike I don't compete against
(28:32):
them.
Even in my local town I was atKaseya Conference met a
Christchurch MSP.
I don't think we've lostbusiness to each other in 10
years, so why would I beconcerned about telling you what
and how I'm doing?
But work out your plan on amethodology.
Now I have a methodology andI'm a really people go, you're
(28:53):
so innovative.
No, I don't have an innovativebone in my body.
I'm an imitator.
Yeah, I, uh, but imitate thebest and then tweak it for how
it works for you.
Um, and so I did that.
I got a methodology, wentthrough with this other msp,
said okay, okay, here's how youcalculate all the figures.
Here's how you calculate it ona methodology.
(29:15):
It gives you a ranking.
How do you feel about that?
And there might be somebodywho's an F customer, who you
think, well, I just can't firethem at the moment.
Well, you're going, okay, great, but that's a decision you've
made.
You haven't let it happen toyou.
You haven't let it get worse.
And it might be.
Look, I'm not charging enough,but they've given me $50,000
(29:37):
worth of contract revenue overthe last three years as
referrals.
So they're not paying for theservice but there's no redeeming
features.
Then find somebody.
So we have two businesspartners.
I have two other IT companies.
I go this customer doesn't fitfor me.
Now I'd like to hand them overto you.
They're like what do you wantfor us?
I don't want anything, I justwant you to look after them,
right?
Yep, because if you don't handthem off, it will come through
(30:00):
in your tone in your servicedesk manner as a leader you will
say to yourstaff.
Maybe we shouldn't be dealingwith that customer in this
manner.
That customer, after six months, will say your service has
dropped and they will leave youanyway.
Right, that's good.
It's not a case of fake it tillyou can't, fake it till you
make it, and that when you'vegot a customer who is truly not
(30:21):
the right fit for you, it's areverse.
You need to get rid of it, findfocus, have a conversation with
them, explain how you havemoved on, explain how their
business is slightly differentand, by the way, I found
somebody who I think could begood for you.
That's great.
Speaker 2 (30:41):
Tim, you've left me with a bunch of nuggets over the
last couple of months.
I call them Timisms, if youwill.
One of my favorite ones.
I want to share with everybody.
It's sales is not a dirty word.
Want to share with everybodyit's sales is not a dirty word.
I think you shared that with us.
Uh at at our event in uh in theblue mountains, because we were
talking about uh and thanks forthe reference to uh, an
american movie.
(31:01):
Uh, field of dreams.
It msp is not a field of dreams, right, it's.
You can't just go out there andsay, here it is, people will
come.
You got to get your butt outthere and you got to start
knocking on.
People will come.
You've got to get your butt outthere and you've got to start
knocking on doors and talking topeople.
So talk a little bit about yourmindset around sales.
Speaker 1 (31:19):
So I was an engineer and I thought and there's always
this comfort, so it's quitefunny, because I've got a
salesperson and he says this isone of the few SPs I've worked
at where there's no comfortbetween engineering and sales.
Is, this is one of the few SPSI've worked at where there's no
conflict between engineering andsales?
Engineers don't go, why thehell have they sold it?
Sales don't sell shit, and thatcomes from I was watching to
get myself into sales mindset.
I'm like sales is just a skill,so therefore you can learn it.
(31:42):
Therefore, it's four hours aday of videos.
Here's subscribing to RobinRobbins, gary Pico, galactic
Advisor, all these differentservices.
They'll get sales training.
It's like I would just put avideo on when I walk to work in
the morning at double speed, soI'd listen to an hour's video on
the way to work, an hour'svideo on the way home, an hour's
video where I walk the dogs.
I'd go for a walk around thepark for an hour and there's two
(32:06):
hours worth of videos.
It's like repetition,repetition, repetition.
And what that taught me waslike sales is only a dirty word
if you're trying to sell thewrong thing to the wrong person.
Sales isn't about selling.
It's about education andfinding the person who wants
what you have to deliver.
And if you can find that it'snot, isn't it?
(32:27):
I mean, look, we've lost somesales recently.
People go your price is tooexpensive.
I go well, that's the priceI've priced myself out to run a
profitable business, to stay inbusiness and deliver the service
that I believe you need.
Now, if that's not the serviceyou need, then there's other
people out there who willdeliver the service you need and
I have no problem with that.
I don't get upset, but I don'tget angry.
I'm like I go well, we'll seewhere they are in three years.
(32:49):
I know who they've gone to,then put them on the list, we'll
carry a marking to them, we'llfollow up with them and if
they've got what they want andthey're paying for what they
need which is less than whatthey want from me, fantastic.
By all good graces, go forwardand run a happy I want them to
run a happy business.
(33:13):
But if you try to sell the wrongthings to the wrong customer,
now that is sales and that'swhere it leaves a dirty.
You know dirty word?
I mean we have one customer,one prospect, who wanted to sign
up with us.
I just said, salesperson, no,we're not signing them like, but
it's five thousand dollars amonth.
I'm like, no, they, they're notthe right cultural fit for our
business.
They're going to cause problems.
Um, so for me it it was training, training, training, the
(33:33):
advantage that it's given me, asmy sales guy loves taking me on
sales calls now, even thoughI've been an engineer for coming
up on 30 years.
He said you don't revert toengineering, you don't risk
feeds and feeds and solutioning.
You're like I can look at whatthe customer's talking about, I
know how to solve it.
And my agent goes I've solvedthat, cool, move on.
How do I turn that intosomething?
(33:55):
I can explain to this businessowner or C-suite person that we
give them an outcome.
It's not about breaks, it's notabout managing the technology.
It's about delivering anoutcome to them that they can
quantify so that they can thensay, yes, we'll pay the premium
you want to charge, because weunderstand how you're different
and that you know I give thesales training right through the
(34:16):
whole business.
People may choose not to do itI mean engineers.
They really don't want to dothe sales training, but there's
a framework course we do thatexplains why we're different and
how we do what we do, so thatthey can sit in front of the
customer and understand, youknow, if the customer says, oh
you know our bill's too much,it's like, well, it's too much,
because here's what we're doingfor you.
(34:37):
We have all these differentdepartments who do different
things.
If you go to a one-man band andthere's nothing against one-man
bands, I was there and we havea need for them- and I've seen
(34:59):
some negative things in the past.
Speaker 2 (35:00):
They serve us a great job for the right customer, but
our price goes up as we delivermore, more departments awesome.
So, tim, you mentioned you havea 30 year short, a short it
career.
30 year it career, uh, and youhave experienced some things
that I think a lot of folkswould have never experienced.
But what would you tell youngtim when he was just about ready
to start his it career that youknow now that maybe you didn't
know that so I went throughschool and tried to get expelled
(35:23):
.
Speaker 1 (35:23):
They tried to expel me from school because I just
didn't really enjoy it.
I was like like I'd turn up andgo.
What are we taught the textbookat the end of the year I'm out
of here.
And so I lacked self-belief.
I failed English, I couldn'twrite really well.
That had a massive impact on myability to do sales.
So I didn't go down the salesroute because I couldn't write
(35:46):
proposals.
I'm like I'll be an engineerbecause if I pull this widget or
this lever, something happens.
It's easy, it's mathematicaland logical.
Um, if I was going back up,you're going like sales is.
Even if an engineer, sales isreally important.
How do you get your next job?
You have to sell somebody thatyou can do a good job.
You know, not just.
(36:07):
I got 99 on on the Cisco exam.
So if I had my way again when Ifirst started the business, I
would be back there going I'llgo and employ an engineer and I
will do sales.
Speaker 2 (36:20):
Awesome.
Speaker 1 (36:21):
And then marketing.
So I think the really big thingis I've got sales is
understanding marketing.
We as a business and industrywaste so much money on marketing
Yep, because we don'tunderstand it.
Speaker 2 (36:35):
We want somebody else to do it for us and we abdicate
it.
Speaker 1 (36:40):
Now I didn't say delegate, we abdicate.
I've paid you $4,000 a month.
I want some results.
Six months later, why haven't Igot the results?
I'm going to move to adifferent agency or try
something different.
Marketing doesn't work andmarketing is a lot harder than
sales, because sales is tangible.
I can go and knock on the doorand speak to Chris and say I won
the deal, didn't win the deal.
(37:00):
He liked me, didn't like me.
My price is too high.
It wasn't too high.
It's instant feedback and youcan put a really good process
for it.
That's quantifiable.
I found 100 people.
One person gave me anappointment out of 10
appointments.
I got four proposals out offour proposals.
I won one of them.
I have numbers once gone.
Well, business just do more ofthat.
(37:20):
Marketing is a field of dreams.
It is you, you.
You build it and you're hopingthey're going to turn up at some
point because it's reallyquantifiable.
There are some parts likegoogle ad words turn up at some
point, because it's reallyunquantifiable.
There are some parts likeGoogle AdWords.
You can get metrics, yep, butit's had to miss Like.
You might put a bad ad outthere and you might spend
$15,000 and get one lead, youchange your ad slightly, all of
(37:43):
a sudden you've got 100 leads.
So marketing, I think, issomething that, as MSPs, we need
to not stop abdicating.
We need to start actuallygetting involved in it, and you
can delegate it.
If you're really busy, you candelegate it.
Find a smart personal agency todelegate who's going to teach
(38:04):
you and walk you through it.
So, as a business owner, youcan make the decision.
You don't actually have to doall the work like print the
flyers and the newsletters andpost the ads.
I'm not saying you should dothat, but you have to have
metrics and be responsible forit yourself.
You can't just go I'm payingthis company 2500 a month, I'm
(38:24):
all good.
Yeah, so like seo, like I writeall my own blogs for for the
seo.
Um, until today, I post all thesocial media posts.
I review them all and know themall because it doesn't take too
long to do.
But I get all that contentdelivered to me.
Like the social media posts areformatted by somebody else, but
(38:45):
I'm picking.
I know what's going on in thebusiness.
Speaker 2 (38:49):
Very good, All right.
So I always I think I told youI was going to ask this question
.
The name of the podcast is theNow that's it podcast, Tim, and
so I'd love to ask you when didyou know?
Now that's it.
Speaker 1 (39:05):
And what sort of did I want to carry on doing IT?
Yeah, that you were yeah, yep, Ithink the funniest thing is I
sat in my garage and I told youI sat in my garage around just
before Christmas.
We've now got to profitability.
We're now growing above theindustry average of 10%.
You know we did 50% last yearof MRR increase.
(39:28):
I use that to get rid ofcustomers.
We're on target to do the sameagain this year.
Okay, well, now that's it.
What next?
And I went.
Actually, what I want to do ishelp other MSPs.
I'm not saying I'm perfect.
I'm not saying I've got all theanswers Hell, no, I'm so far
from that.
But what I am doing is going toyeah, I'm in three peer groups
(39:49):
Enable True Method, rub and Rub.
So I'm trying to gain all thisknowledge and tidbits.
I'm like, well, how can I helpother MSPs?
You know how can I haveconversations?
I mean I'm helping two at themoment, but I've also had
conversations with like three orfour more.
It's like let's have a look atyour books, let's have a.
You know how much help do youneed?
Do you want a?
Speaker 2 (40:09):
little bit of help.
Speaker 1 (40:09):
Do you want somebody to say, hey, ed boy, you're on
the right track.
Or do you want somebody to say,no, you really need to change
this?
But it also comes down to whatthey want to do.
You know what's the end goal,but for me, you know, I mean
(40:29):
after 30 years it's like whatnow?
What now?
Speaker 2 (40:31):
is how can I help other people?
I was hoping you'd say thatbecause that's something you
shared with us.
I think the first time we evermet and it's something that I
love MSPs that have gotten tothat point in their maturity
level where they've said, look,I've made some mistakes, I've
done some good things.
If my stories can help somebodyelse, I want to share it,
(40:53):
because this idea of MSPshelping MSPs is really really
powerful and that's what'sunique about our channel.
Is that?
Yeah, I mean we couldtechnically say we're
competitors with everybody, butwe're not.
I mean you've got folks in yourown community there that you
look at and say, look, I'll sendyou deals that aren't good fits
(41:14):
for me If they help you, great,like that's really really
powerful, tim.
Tim, I really want to thank youso much for joining the pod this
week.
You're an amazing individual.
I'm glad I got to know you.
I can't wait to see how OxygenIT continues to be profitable
and grows over the coming years.
I wish you and the Oxygen ITteam the absolute best of luck
(41:35):
in the future.
Thank you so much.
Speaker 1 (41:37):
Well, thanks for having me along and hopefully,
as I said, hopefully thisconversation can help another
MSP realize it's not all shit.
In closing you said abouthelping the community we are, we
do help like, we are veryhelpful.
So you just find the rightpeople and I put and rather
(41:58):
having a trying to close one newcustomer against a competitor
in my local market, I'd farrather go for a beer with them.
it's great having a beer withsomebody who understands the
struggles we go through becauseyou can't take it home to your
family?
You?
Can't take it home to yourbusiness partner.
You need somebody independentwho you can go have a beer and
go.
I've had a really shit week andthey go, let's have a chat
about that, but the shittycustomers.
(42:19):
Thanks for having me on boardand hopefully, um this helps
another usp up there.
Thanks so much, tim.
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