Episode 42: SPECIAL EPISODE: How this MSP built his business

In this week’s episode So, there’s easy growth and hard growth. Most MSPs go for the harder, less risky route of growing by building their own clients over time. But occasionally we hear stories of MSPs who take the bold step of growing through acquisition. This special podcast episode is all about one such success story. This week Paul invites an MSP owner to share their inspiring story. Listen as David Darmstandler from Data Path explains how he built up his MSP over a number of years through a combination of focus, hard work and also acquisition. There’s some great advice in this show – especially if you’re also looking to acquire or even be acquired Also Paul’s special guest talks about how they have done something that most MSPs will need to do in the not-too-distant future; transition from being an MSP to a true MSSP (a managed security services provider)Show notes Out every Tuesday on your favourite podcast platform Presented by Paul Green, an MSP marketing expert Paul hosts a MSP Marketing Podcast Special, dedicated to the story of David Darmstandler from Data Path (you can email him here) On September 8th Paul’s guest will be James Vickery from Benchmark 365 talking about how best to outsource your workload You can join Paul in the MSP Marketing group on Facebook Please send any questions, ideally in audio-form (or any other feedback) to hello@paulgreensmspmarketing.comEpisode transcriptionVoiceover:Made in the UK, for MSPs around the world. This is Paul Green’s MSP marketing podcast.Paul Green:Hello and welcome to an MSP marketing podcast special. It’s always good to hear other people’s stories and to hear how other people have made it, especially when they’re building up a business, that’s just like yours. And I’m joined today by a very special guest from the States to tell us how he built up his business.Voiceover:This is an MSP marketing podcast special.David Darmstandler:Hi, my name is David Darmstandler, I’m the CEO and co founder of an MSP and MSSP data path.Paul Green:And thank you very much for joining me for this special, David. So I want to explore today your story. I want to explore how you’ve built up the business, what the challenges have been on the way. And then in particular, there are two aspects that I want to examine because I think these are fascinating aspects that will affect a lot of MSPs. One of them is that transition from being an MSP, to being an MSSP, and we’ll come onto that later on. And also, I know you’ve acquired a couple of businesses on the way, and I think it would be useful to look at how you did that, what the pitfalls are and how you can position your MSP to be acquired by someone else, or go out and acquire an MSP yourself.Paul Green:So give us the overview of your business. Tell us when you started, what it was like in the first few years and sort of bring us up to date today in terms of where your offices are, how many staff you’ve got, that kind of thing.David Darmstandler:Data Path is, well, it’s 15 years old as of last month. We started June, 2005, not the best time to start just with the fact that we had a recession that kind of kicked off, at least in California here around that time. But we started off as really an hourly break fix IT solutions provider. So a good buddy of mine, James Bates, had already started as a sole proprietor doing a IT consulting. And him and I had been friends since the third grade and we’ve been talking about starting something together and we formed Data Path and the recession hit.David Darmstandler:And in a lot of ways it ended up kind of being a positive for us. People were laying off their IT departments, unfortunately, and we were able to come in and kind of just do hourly work. So we started off with a pretty low rate. And soon after we kind of developed what we didn’t know was managed services, but we created a couple of different plans. That was 15 years ago. So it was a lot of education to customers about what managed