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From Growth to Exit: 5 Key Insights from Arlin Sorenson for MSPs

In a thought-provoking discussion with Arlin Sorenson at the ConnectWise Secure event, we gleaned profound insights into the pathways for MSP growth and transition. Arlin’s extensive experience in leading MSPs through growth phases provides a valuable perspective on strategic planning and execution. Here are five key insights from our conversation that can guide MSPs in enhancing their operational and strategic frameworks.

1. Understand the Spectrum of Transition Options: Arlin emphasized the importance of understanding the various transition options available to MSPs, beyond just mergers and acquisitions. Exploring ESOPs, family transitions, and leadership team buyouts can offer alternative strategies for MSP owners who may not wish to sell. Understanding these options early can lead to better preparedness and more tailored growth strategies.

2. Focus on Value Creation from the Start: One of the critical themes Arlin discussed was the importance of building value in an MSP from the outset. Effective value creation is essential not just for potential sale or transition but for the overall health and scalability of the business. This involves understanding the drivers of EBITDA and implementing practices that enhance profitability and operational efficiency.

3. Start Early with Transition Planning: Arlin advised MSPs to start planning their exit or transition strategy early. By integrating due diligence practices and keeping organizational documentation digital and well-organized, MSPs can avoid the rush and potential oversight that comes with last-minute preparations. This proactive approach can significantly smooth the transition process, whether it’s imminent or far in the future.

4. Regularly Update and Educate Yourself and Your Team: Continual learning and updating of skills and knowledge bases are vital in the rapidly evolving IT landscape. Arlin pointed out that education and staying informed are key to navigating changes effectively. This ongoing education helps MSPs maintain a competitive edge and ensures they are well-prepared for any market shifts.

5. Create a Comprehensive and Adaptable Business Plan: Finally, Arlin highlighted the necessity of having a comprehensive business plan that MSPs can adapt as needed. This plan should account for various scenarios and include strategies for growth, risk management, and value maximization. Such planning not only prepares MSPs for future challenges but also provides a roadmap for sustained success.

Arlin Sorenson’s insights provide a roadmap for MSPs aiming to enhance their operations and prepare for future transitions. By focusing on strategic planning, value creation, education, and adaptability, MSPs can position themselves for success in a competitive industry. Implement these strategies to ensure your MSP is not only prepared for the future but also operating at its maximum potential today.

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