IN 1999, I decided to start my own IT company—or die trying. I was 40. I had three kids, a mortgage, two car payments, and $500 in the bank. I made every mistake you can make, from hiring bad employees to not charging enough for my services to not writing good contracts. Back then, there was no how-to book, but I figured it out through trial and error, perseverance, enlisting a coach, and good old “shoe leather.” What I’ve learned can help others get started, hopefully without having to die trying.
When I started the business, after a long stint working for a nonprofit and a short stint working for an IT company, it was a break-fix model that I ran out of my bedroom. My first client had wanted to hire me as an IT person, but I convinced them to become a customer instead. Next door to them was a law firm, so I put on my best suit and after some persistent conversation with the receptionist, I got to speak with the office manager about all their IT problems. They became a client. I went to another business in the same complex. You get the idea. It’s what I call “proximity growing.”
We had an early remote workforce of eight before I opened my first office. Each morning they’d get their assignments and go to customer sites. We’d have breakfast together once a month.
I started attending industry conferences and at a Robin Robins event I learned about James Kernan, author of the 36 Month Millionaire Coaching program. He has been my business coach ever since.
Fast forward to 2008. We started to hear about managed services, recurring revenue, and tools for remote monitoring and management. Fortunately, there was a book for me to learn how to make the transition: Managed Services in a Month by Karl Palachuk.
The rest is history. Today TaylorWorks is a $2 million-plus, debt-free managed services business with about 2,000 endpoints under management. For anyone thinking about how to start a successful IT company without losing your shirt, I chronicled it in my 2016 book. Here are some quick tips:
- You can start from the ground up or buy an MSP, but understand the business model and the products you’re selling. You don't have to be the guy who rebuilt SQL Server in the middle of the night, but you must know the industry.
- Don't borrow money to start your company, but do get a line of credit for emergencies.
- There are many products that can help you run your MSP business or enhance your security. Research thoroughly before you buy.
- Learn how to use all the functionality in your RMM and PSA tools and automate as much as possible.
- If you don’t understand accounting, enlist someone who does to set up your books correctly from the get-go.
- Hire an attorney to write good managed services and employee contracts.
- Get a coach who's owned an MSP or has coached MSPs, and go to conferences and network with peers.
- Don’t steal clients. If you’re working at an MSP and planning to go out on your own, ask if there’s a customer they don’t want to work with anymore. You’d be surprised at how often the answer is yes, and now you’ve got your first client
- If you make a bad hire or a good hire turns bad, cut your losses quickly or that person will sour the culture and your customer relationships.
- Stay on top of all the grubby administrative tasks, particularly in the beginning and until you can hire a manager.
- Don't borrow money to make payroll. If you have to do so, you have too many employees.
- Expect to go through hard times once in a while, but keep your eye focused on the future and on growing the business.
- Finally, if you’ve done the proper research, jump out there and get started. There are some things you can’t learn in a book, even mine!