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Nearing 50 MSP Acquisitions, All Covered Begins Data Journey

Todd CroteauAll Covered President Todd Croteau (pictured) has overseen nearly 50 acquisitions involving IT service providers and managed services providers (MSPs). The latest deal, announced this week, involved IT Weapons of Toronto. So what’s next for All Covered — a Konica Minolta business? The answer involves a shift — an extension of sorts — from infrastructure management to the data layer.

The future, I suspect, will involve data-driven decisions and business insights.

The data-centric move starts with standardized IT platforms. All Covered now has roughly 1,000 employees in offices across the U.S., and a first-time Canadian footprint involving IT Weapons. To manage acquisitions and scale the overall All Covered business, the company typically consolidates the acquired IT service providers’ PSA (professional services automation) and RMM (remote monitoring and management) platforms. More recently, All Covered has standardized on Remedy — the IT service management system from BMC. Croteau says the deployment involved a multi-million-dollar investment across the company.

Remedy and All Covered’s other IT systems set the stage for a data shift in the company. As an IT service provider, “infrastructure — managing the customer infrastructure — used to be the most important thing,” said Croteau. “Of course, we have to make the core business infrastructure available and secure for our customers. But we also have to remain dynamic and we have to go where the needs are. Today, the needs increasingly involve the data. And that starts with us getting more into the applications and workflow areas.”

Big Data Service Providers?

Read between the lines and All Covered isn’t quite ready to announce a big data strategy or a data-driven decisions mantra. But Croteau sees the writing on the wall. “We don’t make enough use of the data we collect,” he concedes. “We probably have more data than anyone around how SMBs are using technology — and the issues they’re having. Then you look at convergence — where customers are using more and more devices in an Internet of Things world. And those devices are collecting more and more data.”

Scorecard All Covered 2All Covered isn’t alone on the data-driven channel journey. PSA, RMM (remote monitoring and management) and BDR (backup and disaster recovery) vendors are sorting through the data opportunities. As are distributors.

One recent move involves LogicNow launching LOGICcards, a big data system that helps MSPs to anticipate SMB customer needs. Another move involves MSP veteran Jim Lippie launching the Clarity Intelligence Platform to help MSPs see the IT and business side of their customer base. A growing number of channel-friendly companies are trying to transform data into business insights — for themselves, and for their channel partners.

All Covered Buys IT Weapons: Behind the Deal

Even as Croteau considers the data opportunities ahead, All Covered continues to pursue M&A deals. The latest involves this week’s IT Weapons buyout. Together, All Covered (900-plus employees) and IT Weapons (86 team members) have more than 1,000 employees in North America’s IT services market.

Ted GarnerSpeak to Croteau and IT Weapons CEO Ted Garner (pictured), and they focus mostly on the deal’s cultural fit. “We’re like two brothers from a different mother,” quips Croteau. “Check our styles. Check our temperament. We both own tractors. We both own chainsaws. It was a bro-mance when we met.”

The first meeting between All Covered and IT Weapons occurred in March 2015. Among the key lessons and takeaways from the negotiations and the resulting M&A deal:

  1. IT Weapons evolved before the deal: About 5 years ago, the company shifted from product reselling to services. Top-line revenue didn’t move much, but “the bottom line grew dramatically.”
  2. Blended Model: The circle between IT projects, cloud and managed services “really came together,” adds Garner.
  3. Avoid Greed: Garner and his business partner launched IT Weapons because they grew frustrated by their previous employer’s all-out focus on sales, commissions and quota-driving forces.
  4. M&A Surprises Happen: “We didn’t go looking to get acquired and we didn’t have a for sale sign on us,” said Garner.
  5. Home Field: Garner was impressed when All Covered’s team came to visit IT Weapons’ offices. “It was a big deal to me that they came to see us,” he says. “If they were serious about buying us, we wanted them to have a tour and see what we had built. It showed the value and the culture beyond anything they could see in our books.”
  6. Visitor Locker Room: From there, IT Weapons visited All Covered’s offices. “When you build a relationship with someone, you want to make sure they act the same whether they’re in a bar or in their own corporate office,” recalls Garner. “If they have the same sincere personality in both places, you know you can trust them.”
  7. M&A Isn’t A Finish Line: “This deal is a milestone in the journey,” says Garner. “The future for our collective team is clear: We want to erase borders between cities and bring all those skill sets into the solutions, projects and services we offer.”

No doubt, the All Covered and IT Weapons journey will involve plenty of data gathering, management and analysis as well. If all goes as planned, that data will be transformed into business insights.

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