“Partners are leaving money on the table” – Sherweb’s Rick Stern on MSP billing and partner growth

MSPs are already managing too much - from dashboards, vendor relationships, to multiple billing models. Sherweb is trying to solve this very practical problem for MSPs - helping them bring all that data together, connect it into the systems they already use, and reduce the manual work that eats into margins.

That is why Sherweb is not talking about its marketplace as just another place where MSPs can buy tools. The company has been building a broader story around partner operations, including its recent $125 million raise and expansion into the U.K.

Sherweb's latest HaloPSA integration also fits into the same storyline. It is not just a billing feature, but is being positioned as something that will help MSPs make sure what they are charged matches what they bill their customers. For MSPs, that means they’re either protecting their margin or losing money without realizing it.

ChannelE2E spoke with Rick Stern, senior director of platform at Sherweb, who made a good point about where the market is going, more so, what the ground reality looks like for MSPs right now. Stern was straightforward in his view - MSPs are being asked to do more around security, cloud, and AI. But they cannot keep adding services if every new tool adds more complexity.

So the real thing is that Stern got to was: MSPs need to grow without making their operations messier. This is where Sherweb comes in with cleaner billing, better integrations, more automation, and more useful data.

ChannelE2E: You’ve said Sherweb does not want to be just another marketplace, but a real value driver for partners. What does that mean in practical terms for MSPs?

Rick Stern: There are a few things we’re doing from a platform perspective that are enabling MSPs to simplify, reduce overhead, and cut down day-to-day noise.

The first is integrations. I’ve talked in the past about the integration gap that MSPs face. Oftentimes, they’re presented with a solution that on paper seems absolutely fantastic. They start integrating it, offering it, or reselling it to their clients, and realize that a lot of the data in that product is stuck in a silo.

If you look at what Sherweb does from a value proposition perspective, we are a cloud service provider, and we distribute cloud services. We are a many-to-one type of partner for these MSPs. Half of our value proposition is trying to simplify that noise and reduce that overhead by ensuring partners only have to deal with Sherweb, or in most cases, Sherweb plus another vendor, their PSA or their RMM, to radically simplify the touchpoints they have on a day-to-day or week-to-week basis.

Integrations are a big part of that because we can take the 20 or 30 vendor solutions that we have in the marketplace and distill that down into a consolidated or aggregated invoice, where all the various types of vendors are consolidated on one piece of paper, quote unquote.

The integration also allows them to take that and put it in the system of their choosing. That could be their PSA, taking it out of their PSA and putting it in an ERP, or putting it in their RMM and using it for automation.

It boils down to the data that we have; our value proposition is simplifying and consolidating that data, and then enabling a connector for the MSP to do with it what they will.

ChannelE2E: When you talk to partners, where do you hear the most frustration right now? Is it buying tools, managing licenses, billing customers, proving value, or keeping up with vendor complexity?

Rick Stern: One of the things we continuously speak with partners about is billing simplicity. There are a ton of models and products. You can bill on consumption, seats, or forecasted usage. There are so many different models that MSPs have to account for, depending on their clients.

Where we try to fill that gap is by simplifying that billing process, but also the buying process. We offer as many high-quality, catered solutions as possible that MSPs either want to use themselves or are eager to resell to their partners, and we try to offer that in the simplest way possible to get out of their way.

At the end of the day, they’re not going to take the Sherweb invoice and simply present it to their clients. They’re going to generate their own PDFs. They’re going to generate their own QBRs. They’re going to showcase their own benefit to their clients in their own way. We want to make sure that we have the ability to get that information in front of them in several different ways.

AI is also a major topic right now. Two or three years ago, we were all talking about automation. I still think automation is important, but now you can enable automation through the use of AI. MSPs were just beginning to understand automation and how it fits into the workflow, and how their business can scale with it. Now, all of a sudden, they have this big new problem around AI, not only how to use it themselves, but because their clients are asking for it too.

We’re leveraging AI internally to make sure we have a good point of view. We are very knee deep in Copilot as a solution. We try to educate as much as possible, not only so the MSP can understand it and leverage it, but also so they can turn around and resell it if that’s what they want to do.

ChannelE2E: When an MSP adds more security, backup, AI tools, or services into their stack, it can get messy fast. How are you helping partners simplify all of this and educate them at the same time?

Rick Stern: First and foremost, we have a fairly robust system of roadshows that we establish across North America and Europe as well. We are sitting down with partners and bringing in our own in-house expertise around Copilot. We also leverage expertise from Microsoft and have a very strong Microsoft relationship, so there’s a good opportunity to leverage that.

Outside of that, one of the differentiators of Sherweb is certainly around our level of service. From our sales folks down to our support folks and everyone in between, if a partner doesn’t understand a solution and is maybe under pressure to offer said solution, we want to make sure that we bring our expertise to bridge that gap with them.

We succeed by enabling our partners.

ChannelE2E: For MSPs trying to grow managed security revenue, what is the hardest part right now? Is it building the service, selling it, proving value, protecting margins, or choosing where to start?

Rick Stern: There are a few things to keep in mind. First, it comes down to the solution and the outcome that the partner is after. It’s a bit of a chicken-and-egg situation. Unless they know about the security space, it’s hard to know what kind of outcome they want to drive.

From an MSP perspective, getting that education and talking to experts in the industry is important. If I’m doing X, how do I get to Y? First, you need to understand what Y looks like. Then you investigate and evaluate solutions that help you bridge that gap.

The other part is self-education or leaning on other experts in the industry. Peer talks and peer reviews are also huge. There’s a ton of success in the industry these days around security. If MSPs are not offering that in their portfolio or as part of their stack, there’s an opportunity there for them.

Another thing I would advocate for is that there are a lot of services out there that are ad hoc and do very specific things very well. Then there are solutions that are packaged and come in a security platform. If MSPs are trying to break into security, I would err on the side of the latter instead of the former, because it gives MSPs tools right out of the box to leverage.

Even if two years down the road, you determine that maybe one or two feature sets in that platform are not sufficient, that’s when you go to some of those ad hoc or a la carte solutions to supplement or replace what that larger platform couldn’t give you.

On top of that, I think the hardest part for MSPs is proving the value around security. We heard someone on stage last week at Kaseya talking about a client who called and said, “Why am I paying $3,000 a month for this security suite? Nothing ever goes wrong.”

How do you answer that? The whole reason nothing is going wrong is that we have the security suite in place to help ensure that your business is running smoothly. There is an education factor. Once MSPs feel confident enough themselves to offer that service, they also have to educate their clients to prove the value of those security products.

ChannelE2E: Have you reinvented how Sherweb integrates with vendors in the MSP space? Is there a certain standard you look at when you bring vendors on board?

Rick Stern: Absolutely. If you look at other CSPs in the industry, some have been out there adding every vendor under the sun so they can say they have a full marketplace or a full line card.

We’ve taken a slightly different approach. We are more interested in meeting where our partners are currently and where they want to go. We’re looking for groundbreaking or incredibly innovative solutions that MSPs are either using today and want to leverage Sherweb’s brand power to work with that vendor, or emerging vendors in a vertical, or new space that we feel would be an excellent addition to their stack or service offering.

We’re trying to hit the big names, the quality names, and the quality services that are out there, but also do things that other CSPs are not doing. There’s most certainly a vetting process that goes into that. There’s also an integration process that goes into that, which we’ve refined over the last two years. We’ve added between 20 and 30 new vendors in the last two years, so we really accelerated and honed our own internal expertise to bring those products to market when those agreements are ready.

We also ensure that we’re billing consistently and still providing the value proposition we talked about earlier, of being that single invoice and aggregator on behalf of the MSP.

ChannelE2E: If a small MSP wants to engage a vendor through Sherweb but does not have the technical capabilities to handle that kind of integration, do you help them?

Rick Stern: That happens all the time. If you’re a small MSP, we will work with you and the vendor to get an appropriate price point, get an appropriate margin, get set up and configured, and also provide some of the resources to help you resell that product if it’s a sell-through. If you’re a larger MSP, there’s a good chance you’re already working with these vendors on some level.

It goes back to that noise comment we were talking about earlier. If those larger MSPs want to reduce that overhead and reduce the noise, and they’re already going through Sherweb for 10 other vendors, they can transition this one vendor that they happen to be direct with over to Sherweb.

We’ll facilitate that as well and essentially say, our collective partner, we will handle this transition for you so that, again, we can deliver that value prop of a single bill for that partner. It really depends on the partner size and their maturity, but we offer solutions across the spectrum.

ChannelE2E: Billing is where a lot of MSP complexity shows up. It affects margins, customer trust and the time teams spend fixing mistakes. With the HaloPSA integration, where do you think partners will see the benefits first?

Rick Stern: There are a few key areas. One is the invoice and the data that powers that invoice. A step beyond that with this integration is ensuring that the data that exists on that invoice is also the same data that exists in your PSA, in this case, HaloPSA. That allows the MSP to, with confidence and reliability, invoice their clients at the time of billing or at the end of the month, whatever that happens to be.

That’s the key value upfront: ensuring that there is a like-for-like scenario between what you’re being charged as an MSP and what you’re billing your clients. If there’s a discrepancy between that, or if there’s no reconciliation, you’re theoretically leaving money on the table.

The second thing is ensuring that data is sent over in real time, and not only at the time of invoice generation. If you’re canceling a subscription or buying something else, ideally, you want that information in real time because you’re not going to be on our platform every day. You might, but probably not. But you or multiple people are going to be in HaloPSA every day. That’s where your source of truth should be. We wanted to make sure this new integration was as real-time as our systems, and Sherweb could make it.

ChannelE2E: What should partners expect from Sherweb over the next year or two? More automation, more services, more expansion opportunities?

Rick Stern: So many things. It’s hard to fit into one answer. You’ll see us be able to execute on our strategies, both domestically and globally, a bit faster. You’ll see us accelerate our speed. I would expect to see Sherweb evolve more globally than what we’ve done in the past, without taking our eye off the ball in North America. We are still incredibly invested in North America.

I would boil it down to three things: integrations, interconnectivity, and AI as differentiators. You’ll see us delivering on that over the next year to two years in an aggressive way.

ChannelE2E: In a saturated market, what is the one thing that differentiates Sherweb from competitors?

Rick Stern: I have to say our biggest differentiator is our people. Every Sherweber comes to work every day and truly cares about our partners and their problems. If partners out there, if MSPs out there, are not getting the most out of their CSP or their distributor, just know that there are other options out there, and that our people will take care of you.