ConnectWise, backed by private equity firm Thoma Bravo, has acquired Service Leadership, a consulting firm that assists MSPs and technology solutions providers (TSPs) with business development, performance benchmarking and more. ConnectWise will align Service Leadership with its IT Nation community, the buyer says.
This is M&A deal number 88 that ChannelE2E has covered so far in 2021. See all technology M&A deals for 2021 and 2020 listed here.
ConnectWise develops IT management and business automation software that's widely used by MSPs and TSPs. The company also runs peer groups built around the HTG Peer Group acquisition of 2018. The former HTG was rebranded and tucked into the overall ConnectWise IT Nation Community.
ConnectWise Acquires Service Leadership: Background and Next Steps
Service Leadership develops the Service Leadership Index (S-L Index), a benchmark of TSP financial performance, operational maturity and value creation, worldwide.
ConnectWise will strive to integrate Service Leadership insights into the ConnectWise platform immediately, offering both new and enhanced Business Insights tools and functionality, the buyer says.
Existing and new members, and TSP industry peer group providers and coaches, will continue to utilize Service Leadership’s current offerings as they continue to evolve, ConnectWise adds.
Service Leadership CEO Paul Dippell and his team will join the ConnectWise strategy organization, reporting to Chris Timms, executive vice president of growth. Dippell will continue to lead Service Leadership.
ConnectWise Acquires Service Leadership: Executive Perspectives
In a prepared statement about the deal, Chris Timms, EVP of growth, ConnectWise, said:
“We prioritized this acquisition as the TSP industry is experiencing significant disruption. At ConnectWise, we’re big believers in the value of data analysis and this disruption is showing that understanding data is critical because it allows TSP’s to make business and strategic decisions based upon empirical data and not speculation. Paul and his team have been massively successful in helping TSPs thrive. Their work has been truly impactful for entrepreneurs and we’re thrilled to welcome Paul, Brian O’Connell and the entire Service Leadership team to ConnectWise to drive success for all our partners.”
“We have been very fortunate to have great clients and to build the premier, data-driven TSP consulting firm with the leading TSP financial benchmark and business maturity platform worldwide. When we made the decision to seek a strategic acquisition, we were pleased to speak with almost a dozen key industry players. We came to recognize that ConnectWise was the right choice. They have the best vision for leveraging the S-L Index and SLIQ platforms together with the partner operational data they have, to produce opt-in analytics that will give their partners clear advantages in the marketplace.Like us, driving partner success is part of ConnectWise's core DNA. ConnectWise is the best place for our people and our clients – both individual members and the peer group and coaching leaders we serve.”
Admittedly, M&A in the peer group market can be tricky -- especially when it involves software companies acquiring consulting firms. MSPs within those peer groups frequently want vendor-neutral information. We're set to catch up with Timms and Dippell soon, and will ask them for perspectives on vendor neutrality.
Generally speaking, the best performing MSPs typically belong to peer groups -- especially MSPs in the SMB sector. In addition to Service Leadership Inc., popular peer group organizations include Taylor Business Group, TruMethods, True Profit Groups, Ingram’s TrustXAlliance, and groups that focus on EOS -- the entrepreneurial operating system. Moreover, marketing and sales consulting firms such as Robin Robins and The Wiser Agency have momentum in the market.
ConnectWise, Rivals: Recent Acquisitions
Private equity firm Thoma Bravo acquired ConnectWise in February 2019. ConnectWise, in turn, has acquired multiple companies since that time. Key deals include:
- October 2019: Continuum for outsourced IT service desk expertise;
- October 2019: ITBoost for MSP documentation software; and
- November 2020: Perch Security and StratoZen for SOC and SIEM security services.
Several rivals have also continued their M&A activities. Recent deals include Kaseya buying Graphus Security; Datto buying Gluh; and Pax8 acquiring Wirehive, a Microsoft Azure cloud partner in Europe.