Episode 163
Welcome to a special episode of the MSP Marketing Podcast with me, Paul Green. This is THE show if you want to grow your MSP.
This week's podcast is all about our special guest, Anne Tasker, who grew her MSP to £5m in revenue. She joins me to explain exactly how she did it and the lessons she learnt along the way.
Anne founded Zenzero Solutions in 2001. During her 20+ years as Managing Director of Zenzero she took on multiple responsibilities as the business developed. Initially hands-on supporting customers, implementing innovative digital services. As the business grew her focus moved to: developing the core technical teams and SLT; developing the sales engine; and implementing commercial and risk controls. In 2021 having grown the business organically to £5.5m, she successfully obtained Private Equity funding to ensure the continued growth of the business. Anne is now a Non-Executive Director for the business which is allowing her to enjoy other interests (mainly sailing!).
Connect with Anne on LinkedIn:
https://uk.linkedin.com/in/anne-tasker-4072217
Extra show notes:
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- Got a question from the show? Email me directly: [email protected]
- On the subject of Zenzero's private equity funding, I suggested listening back to Episode 122 that featured them:
Episode transcription
Anne Tasker:
Hi, I'm Anne, and I built an MSP from nothing to 5 million. That felt successful because we were continuing to grow the services we were offering, there was real value to that and we should have been putting prices up maybe a little bit sooner than we did. It was an interesting time making those mistakes, but ultimately, I think we came out of it better for it.
Voiceover:
Paul Green's MSP Marketing Podcast Special.
Paul Green:
Hello, and merry Christmas to you. Welcome to our final podcast of 2022 and a very special episode. You see, this week, I want to inspire you to do something amazing with your MSP next year. We are focusing this entire episode on a massive success story. In a second, I'm going to introduce you to a very special person who did the same thing as you did, they started their own business, in fact, it was 19-odd years ago, started their own MSP and then built it up over nearly 20 years into a business turning over more than 5 million pounds here in the UK, and then exited that business.
And they've since gone on to be part of a management team buying other MSPs here in the UK. It's an amazing story that's full of a mix of things that went well and things that didn't go so well. And what I'm aiming to do with this episode is to inspire you to take next year and make next year the year that you really go for it with your MSP, that you go for extra growth and you really push it to the max.
Voiceover:
Paul Green's MSP Marketing Podcast Special.
Paul Green:
Let me introduce you to this week's very special guest.
Anne Tasker:
Yeah. Hi, I'm Anne, Anne Tasker. I was managing director of Zenzero and I'm now a non-exec director for that business and continuing to enjoy being part of it.
Paul Green:
And thank you so much for joining me on this recording, Anne, this is going to be such an inspirational episode. Let's start at the very beginning. So, you started Zenzero all the way back, and it seems so many years ago now, doesn't it? But it was back in the year 2001. So, tell us, what were you doing just before you had that entrepreneurial seizure and decided to start your own business?
Anne Tasker:
Oh, well if only I thought I was going to start my own business. It was purely accidental. I was doing some contract work and I happened to be introduced to some people and I just thought, "Do you know what? I can do better than that." I've seen people buying IT services, talking to IT people, and it just didn't make sense and I just knew I could do better than that. So, I thought, "Yeah, I'll start and I'll do it."
Paul Green:
But there must have been some kind of an entrepreneurial streak there. I mean, is it something that runs in the family or is your family more from the technology side? You, yourself, you were a technician, you were an IT person before.
Anne Tasker:
Yeah. Yeah, no, I was in IT. I was actually a software developer doing management reports, developing very trending now, Power BI. So, I think I was ahead of my time. I really enjoyed helping businesses understand technology and see what technology could do for them. Not just installing it, but actually going and talking to them, so they understood it, because it didn't feel like that was happening when I spoke to people. And I got real enjoyment out of it and I wanted that satisfaction, and that's really why I started the business.
Paul Green:
Yeah. But going from being a software developer to running your own IT firm, you clearly didn't enjoy money then, because you must have taken quite a pay cut to do that.
Anne Tasker:
Yeah. I mean, it's all about the enjoyment as well. Seeing the satisfaction out of what you can do and actually seeing the potential of that, what you can deliver to those businesses. And it was always more about providing that extra element, which my software background allowed me to do. It helped businesses to not only function on technology but to get the most out of it. And I think that's where the two things came nicely together.
Paul Green:
And of course, 2001 is literally ancient history, certainly in technology terms. So, when you first got started, I presume, did you just open a break fix shop?
Anne Tasker:
Actually, it was always a managed service. I always thought that was really important by not just providing kits or fixing kit, but actually providing the service along with it. Now, I mean that's all the rage, obviously with most MSPs now do that handholding, trying to build that relationship with the customers. But I always thought that was the bit that always interested me. So, that's the bit always did.
So, it was always about, yes, it was about providing some kits and it was about fixing it if it went wrong. And I got some horror stories about the good old modems that used to make that really screeching noise. And yeah, technology's changed but it was always about enabling customers to do more and I think that's why it was exciting.
Paul Green:
You know that no one watching this or listening to this under the age of 30 has any idea what we're talking about with modems screeching.
Anne Tasker:
I'm not going to imitate that noise for you, but yeah.
Paul Green:
No, I think those of us above 30, and I'm certainly well above 30, we know exactly what you mean. Looking back then, if you started off trying to do those managed services before that was even a phrase. I would say that's, what, probably 10 years or more before that was even a thing or thought of as a thing? What kind of struggles did you have trying to educate the clients? Because sometimes, I think you can be a little bit too ahead of the curve, can't you?
Anne Tasker:
That's obviously something, again, it's building those relationships. That's the most important thing I think you can do in any business really, but it's that old adage that you got to get to know your clients. People buy from people. And I think they appreciated the fact that we talked to them. We didn't just provide kit and leave them to it. We were trying to help and understand why they needed certain kit, why there were certain levels of service.
One of the first things I remember doing, which was again, it's pretty standard now, but it was pretty unique at the time, was we insisted on certain things as part of our contracts. So, all our customers had to have antivirus software that we provided and we had our struggles with suppliers getting that licensing model right. Whereas now, of course, it's very standard. We insisted that all our customers had backups. These weren't options that we talked about. They were, if you're coming and talking to us about your IT, these are the things you need to have as part of that managed service.
I think that's where we were able to grow. People recommended us because of those services and obviously we retained customers as well, because if things did go wrong, we'd got everything in place to put it right again. So yeah, I think that was quite important in that growth. And obviously now it's pretty commonplace in the MSP market, that that's how the model works.
Paul Green:
Yeah. And when we talk about you selling managed services 20-odd years ago, were you doing that on a recurring revenue basis? I know a lot of people did the blocks thing, didn't they? Where they would sell a block of units and then use those units up. Or, did you have some other way of billing your clients?
Anne Tasker:
What we did initially, we carried on doing and still do as a business today, in that we charge a fixed amount per month, and that allows almost unlimited support. Obviously, there are limits to that. If a customer needed to call us, what we didn't want them to do was to think, "I know I'm going to use up a block of time, so maybe I won't call them just yet." Situation gets worse, things happen, "I clicked on an email, I shouldn't have done." Those sort of things. You want the customer to ring you straight away about those, rather than worrying about using up units of time.
So yeah, we always had a way of doing the contract that it was a fixed price depending on the number of users, the complexity of the infrastructure. And we just had a fair usage policy on that, so we'd monitor how much the customers were using it and obviously if they peaked, if they suddenly started using more than we thought they should. Well, that either was a conversation about price or there was a conversation as to, "Why are you using us so much? There's obviously clearly something not working." So again, it was a great way of having that engagement with the customer regularly, just to make sure everything was on par.
Paul Green:
Now, the first few years that you were running that business, did you run through the standard first three, four, five years that most MSPs, in fact, most businesses go through, where you, yourself, get really busy and then you hire some help and the help doesn't quite provide you as many hours as you're buying? Because you might be buying 40 hours a week of someone's time, but it takes another 10 hours of your time to keep that person going, and then you have that frustrating thing of trying to increase the work to pay for the employees, and the chicken and egg thing of, "Do I hire more resources first or do I get more customers?" Did you go through all of that and how many years was that a struggle for you?
Anne Tasker:
Well, I'd say always a struggle. Those things always happen. I always think it's like stairs, you'll go quite smoothly for a while and then you'll suddenly hit a bit of a barrier as you're going to go up the next step and you have to make that next investment in people.
So, when I started the business it became clearly obvious that I couldn't do everything. So, you had to make your first hire. Then it was like, well suddenly, as you say, you've got that huge drop in, effectively, income to the business because you've got to pay someone. I think that's something you go through but you learn by that as you go through your journey. So, you have similar problems later on. They're just slightly bigger problems or bigger challenges, I should say. Not really problems, they're challenges.
Paul Green:
Yeah, no I would agree with that. My business growth journey is nowhere near as impressive as yours, but I think you're right, that when you hire your first person ... My very first employee, Lucy, Lazy Lucy, we used to call her, after we'd fired her.
Anne Tasker:
Oh, did you?
Paul Green:
And I made all the mistakes on that first employee. I hired the wrong person too quickly and I expected them to do everything that needed to be done. It's a classic mistake and I've made it, I'm sure you've made it, everyone's that mistake. But certainly early on, when that first employee turns out to be wrong, after two weeks, you don't sleep, do you? It is actually, it's like your entire world has come crushing down. Whereas I guess, when you've got 40 or 50 staff and you get a hire wrong, because everyone gets a hire wrong now and again, as you say, it becomes a challenge, it's a minor annoyance rather than a complete tragedy.
Anne Tasker:
Yeah. And you've just got to face different challenges because you've got to put structure in, you've suddenly you've got a service desk of people and then suddenly you need a service desk manager. So, it's just different challenges. As a service industry, people are absolutely key to the business, and I was very fortunate that I happened to know the first person I employed in advance, which was great, because it took away a lot of the strain that you'd normally get with just recruiting someone.
Then you got the second person. I think it was my second person I hired that was the, "Oh, what have I done? Oh, that was a mistake." And bizarrely it was actually a salesperson. Myself, and the other guy was technical, and we thought, "Right, well, we need to grow the business." At that point we were already thinking, "We need to get that next contract in." We wanted an office. Those overheads that you initially need as you start the business. But oh dear, that was one of those mistakes. The first one, very junior person. So, we moved on from that quite quickly.
Paul Green:
Yeah. No, what's really interesting, Anne, is, and I talk to a lot of MSPs, I interview a lot of people who have grown a business and have been very ambitious and it's quite rare that early on ... When someone starts a business for the sake of, "Right, I want to do something, I know I can be good at it and I want to do a good job and look after the customers." Which is why most people start most businesses. It's quite rare for them as early on as their third, or their second or third hire, to actually start to think about taking on a salesperson. Did you know from the beginning that you wanted to build up something big and impressive and something that you could one day sell? Or, was that something that it took you a few years to get to that point?
Anne Tasker:
I always wanted to be successful. Anything I do, I want to be good at and I wanted to be successful at. And certainly, in the early days there was a need to grow it or a wish to grow it. So, obviously it seemed in my head an obvious thing to do, because it's like that, "I'll hire a salesperson. We'll get loads of sales in, this'll be easy." But of course, it's not quite that easy.
To be fair, I think we were probably turning over 800,000, we'd probably got seven, eight people and we did then make another investment in sales, and that was a more structured and a more well thought out hire in terms of sales, someone with a little bit more experience that could keep my enthusiasm in check as to what a salesperson could actually deliver, but actually build on the relationships we've got with existing customers. But obviously also look at what we needed to do to drive new business.
Paul Green:
Was there a pivotal moment where you perhaps had a long holiday and you came back and you thought, "We're doing really well but we're never going to be super successful if we carry on down this route?" And was there that moment where you pivoted off and did things differently? Or, was it just an iterative process?
Anne Tasker:
Being always thinking about growth and wanting to make the business better, always reinvesting in the business. It was never really a business where I was doing it just to take income out of. I was growing something to be proud of. I think it's difficult when you've not done it to think, "What is the end game? What am I actually trying to achieve?" And for a long time for me, it was more about the growth of the business, the success of the business, making sure that people we brought into the business enjoyed the business as well, and just making sure that the clients were happy and just wanting to build a successful business. And that was really the focus for a very long time.
It was probably only in the last five years, we started to think about, "Well, at some point there's got to be an exit. At some point we need to think about what's next and what we want for the business."
Paul Green:
I'm going to come back to that exit shortly because that's, I think, quite an interesting part of the story. Let me just ask you about success. You've said a few times that you wanted to be successful in that business. How do you know when you've achieved success?
I talk to someone, you, who's built up a business, who's exited that business. By any measure you are successful, but I guess we all have different things that we measure success by. So, as you were building that business and as you were clearly making money out of it, you were clearly winning more clients, the business was getting bigger. Did you feel as though that mythical, "I am successful," level, was getting further away from you? Was it tangible or was it just something that was always just out your reach?
Anne Tasker:
Yeah, it's interesting. So, for me, the measure of success was customer retention and how happy our customers were, because I always thought that if we were doing a good job and that was ultimately what the business is about, we wanted to do a good job for our customers. So, as the number of customers extended, some of our customers grew at the same time as us. We grew at the same time as them. That felt successful, because we were continuing to grow and we'd always set ourselves a budget for the year and try and hit that.
So, you planned out what you wanted your revenue to be, how many customers you wanted to attract, and we always kept a close eye on that. So again, if we hit those targets, that was a good measure of success. I have to say, one of my ambitions was always to try and get out the day-to-day business, and that would've been another great achievement. I must admit, I never really achieved that. There's always something to do, always something you have an idea and you want to do something. Yeah, I think it sounds a bit odd but yeah, that customer success was really how I would measure my success in the business.
Paul Green:
Did you proactively try and remove yourself from the day-to-day running of the business at some point, perhaps by putting in a general manager or a managing director?
Anne Tasker:
At one point in the journey I think we'd got to about 4 million, little bit of me thought, "Do you know what? This is getting a bit too big for me." And I brought in a managing director, I brought in a finance director, and I brought in a sales director. I thought, "I'll go the full hog." And actually, what it taught me was there was no one better to run the business than me.
And actually, that was a bit of a reawakening and it gave us momentum to move forward as a business. The team were very supportive of the changes, but ultimately, we came out of that more focused, more enthused, more energetic. I think it was an interesting time making those mistakes, but ultimately, I think we came out of it better for it.
Paul Green:
So, do you think the process of hiring a management team from scratch, which is a huge thing to do, do you think the process of doing that actually gave you the confidence to realise that you could do this?
Anne Tasker:
Yes. Yeah. No, and absolutely. And don't get me wrong, we've promoted within the teams, which is always great. People who joined us very early on, went into those management roles and ultimately, we made some mistakes but we brought in some great management team members towards the end as well, I'd say about three years before I exited, after the mistakes. That's the good thing about mistakes is as long as you learn from them, they're actually really useful.
Paul Green:
Yes.
Anne Tasker:
So, just making those mistakes. And then we brought in a very experienced service delivery director and it was just a marvelous ... Everyone really took to him, made a big difference, knew a little bit more about how to structure the teams, was very specific about our industry. Just made a big difference.
Paul Green:
I think as long as mistakes don't wipe you out and you make sure you don't repeat the same mistake again, and mistakes can actually be more useful learning experience than anything else. Before we come on to talk about the exit, let's look back, I want you to look back over the nearly 20 years that you were growing that business and driving it. And I'm sure there were loads of very, very high moments and also some very low moments.
My core question that I'm interested in is, if you could get in a TARDIS, which for those who don't know, is Dr. Who's time machine on the British TV show. If you could get in a TARDIS and travel back and talk to yourself of 2001, what key pieces of advice would you give yourself? Essentially, what would you do differently if you could do it all over again?
Anne Tasker:
Like you say, the mistakes you make are part of the journey and it would've been great to bypass some of those, but I think they're part of that journey. One, I guess, comment I'd say is, more confidence just that, "We are going to build this and it's going to grow." Ultimately, looking back, I enjoyed the journey, so yeah, I probably wouldn't want to give too much away to myself in the past, because I think having those challenges were a good thing. They might not be nice at the time, but they're a good thing at the end of it.
Paul Green:
That was a very good politician's answer. You completely sidestepped my question there. So, I'm going to do the journalist thing and ask you essentially the same question but with different words. Looking back, what do you wish you'd done faster or what do you wish you'd done sooner?
Anne Tasker:
Probably focusing on profit a little bit more, sooner. We tended to be that as long as we were getting new customers and we were servicing, and as long as we were making some money, we didn't worry too much about profitability and we probably let too many customers ... The costings needed to be corrected. And I think we should have done that a little bit earlier. It would've been good to focus on that we're actually there to make money at the end of the day, because we're a business.
And I think it would've been useful to plan that out a little bit better, just understanding that the services we're offering, there was real value to that and we should have been putting prices up maybe a little bit sooner than we did. Because it's really easy and I know everyone says it, it's really easy not to put prices up, but it is actually, I think customers appreciate that if they're getting value for money then that's a good thing to be doing.
Paul Green:
Yeah. They don't mind paying for it. And also as you're growing a business, assuming you own the business, once you've covered your own personal income needs and assuming that you're not yourself looking to get a yacht or that house in Barbados or whatsoever, it becomes easier to not put the prices up and not to worry about the profit. Especially as the turnover is growing, because you can look at it and think, "Oh well, we can always monetize that. We can always turn more of that turnover into profit down the line." But I agree with you, far too many ... And this isn't just an MSP thing, this is all small businesses, it's just too easy to go another year and not put your prices up and just hold back.
Okay. Let's talk about the exit. So, you exited, let me just check my notes here. So, you exited two years ago, so it was December 2020. How long before that exit did you realise that you were done with the business, that the business was ready to move on perhaps without you at the helm?
Anne Tasker:
Yeah. I mean, that's an interesting journey really, because the year before, 2019, before we did our deal, we were actually looking to do our own acquisition. We were really focused on growth. We'd hit one of those little barriers that needed a bit of a step up. We needed to increase the number of services, we were going after bigger clients, we wanted to get into different technologies. So, we were actually looking to do our own acquisition in 2019 and we looked at a number of businesses.
And then of course, we all know what happened in March 2020, time-wise and timeline-wise though, it actually worked really well for us, because I think we could have made some mistakes. Whereas, what's actually happened is I've exited, but the business has continued to grow. I'd love to say it was planned out for that year, but actually, we were probably thinking it was going to be another three or four years before we got to that point. But it's funny how sometimes things happen earlier than you expect and actually all for the best as far as we were concerned.
Paul Green:
Yes. And even though you're not actively leading the business, you're still involved in the business because you dropped down, I think it was January this year, wasn't it?
Anne Tasker:
That's right.
Paul Green:
That you dropped down from a leadership role down to a non-executive role.
Anne Tasker:
For a year, I stayed on in the business because as I say, I wasn't necessarily looking to get away from the business, just wanted the business to go through that next step, that next level. We'd got a great team of people and again, we still needed to build it, and this was a much better way of us doing that and achieving that for the business than if we'd tried to do something slightly differently.
Yeah. So, it was a very interesting 12 months, as you can imagine. And the business has now done a couple of additional acquisitions. Obviously, during COVID it's had its challenges, but again, it's just been able to see the business continue on that journey and the people within the business carry on their journey. So, it's been great to see that happen. And obviously, it's great for me. I've got more time now since I've stood back, but it's still great to be involved with the business and see it growing and continuing to see how it evolves in the future.
Paul Green:
You exited to a private equity organization called Fordhouse and we actually had Nicholas Ashford from Fordhouse on this podcast. From memory, it was episode 122, which was back in March this year. And that's worth going and having a listen to that, especially if you're thinking of exiting your MSP in the next year or two. When you were looking at exit options, Anne, did that one stand out from day one? Was that a number of different options, or what drew you into that?
Anne Tasker:
Yeah. So again, as we hadn't necessarily been looking to exit at the time, it's not like we did a whole big beauty parade of different investors or speaking to other MSPs. We'd spoken to some but nothing too serious. But yeah, I mean, speaking to Fordhouse, the opportunity just seemed too good to miss, really. It was a smaller private equity firm. I got to speak to the partners, they cared about the business. Again, it was quite a unique way that they were funded. And it just meant that the future for the business looked really attractive under that investment.
So, protecting people, making sure that we talked about culture, which was really important, and how we grew that business. So, the enthusiasm I got from them and the knowledge from Fordhouse, that they knew a lot about the MSP market already. This was more than just an investment. It was something that they'd researched and obviously cared a lot about. So, for me, it made sense to go with that partner.
Paul Green:
And clearly Fordhouse has, it's been two years and as you said, you've already made a couple of acquisitions and Zenzero has continued to grow, and I know that a great deal of work has been done over the last couple of years, building on the work that you put in of a couple of decades of your life. It sounds terrible when you say it like that, but that that's the reality of it, isn't it?
Anne Tasker:
Crazy.
Paul Green:
Each of us can only do something like this once or twice if we're going to put 10 or 20 years in every time we do it. So, you've acquired a couple of other MSPs and you're now working with the overall management team to look for other MSPs. So, tell us what makes the perfect MSP, for someone that's listening to this, whereabouts would they be geographically based? Would it just be UK or would it be other countries? What kind of turnovers would those businesses be? What's your ideal partner that you might want to talk to in 2023?
Anne Tasker:
Yeah. No. So yeah, I've got a great role now of going out and talking to other MSPs, which is great because we're in quite a unique industry, in that we all like talking to each other and sharing stories and sharing our experience, which is great. It's not like some industries where it's all very closed book.
But yeah, so we're looking for high quality MSPs. We're looking for that cultural fit. So, we're looking for businesses that offer quality services with good customers, of a good size. We're looking for businesses that are transacting with those slightly bigger businesses. Obviously, it's important again that technologies are aligned. So, we're looking for people that are dealing predominantly with the Microsoft technology stack. And again, we're looking to increase our skillsets in terms of Azure and Power Platform, Power BI, all those services now that are adding onto the services that we offer.
So, as far as Zenzero is concerned, yeah we're focused predominantly in the UK. We do have offices now outside of the UK to help us service customers. Probably in 3 million turnover, plus. But again, it depends if there's a real niche that an organisation has a particular skillset in, that's again something that would be attractive to us.
Paul Green:
Okay. And we'll come onto your contact details just in a second. You did mention that you've stepped back from the business and started doing fun things, other things. Surely, you haven't got a hobby or anything now, Anne?
Anne Tasker:
Yeah, I know it's great, isn't it? Although I don't know, everyone says you fill your time, but yeah, I mean I love sailing, so I'm able to go out and do that a little bit more. It's a great position to be in, have that real life balance that everyone talks about, work-life balance. So, I get to dip in and as I say, still be involved in a business I love, but yet have a bit more time to do the things that are a bit more fun.
Paul Green:
Thank you, Anne, you've been absolutely inspirational. It's so rare for someone to lay out exactly what they did over a long business journey, to build a business from nothing. If you think about what you've actually achieved, and I'm sure you've reflected back on it, but all of us are on this mission to turn nothing ... Literally, we're sitting down in our spare bedroom on day one of the business and we're looking to create that from literally zero, where it doesn't exist, to something that's so valuable that someone else is willing to actually pay money and take that off our hands, and keep you involved, which is very much a measure of you and what you've achieved over the last 20 years.
So, thank you so much for spilling your story with us, for sharing that. Well done, for what you've achieved. And just for any MSP that does want to just have a chat with you about whether or not they would be a good fit for Zenzero, what's the best way to get in touch with you?
Anne Tasker:
If anyone wants to link me in and drop me a message on LinkedIn or drop me an email, my email's Anne, with an E,
[email protected]. Obviously, you can look me up on the website or find me on LinkedIn is probably just as easy. But yeah, it'd be great to speak to anyone that's interested and even if you don't think it would be a fit, if you want to just have a chat, more than happy to do that as well.
Voiceover:
Coming up next week.
Marcus Sheridan:
Hey, folks, I'm Marcus Sheridan, the author of They Ask You Answer. I'm going to be on the show next week. Yeah, we're going to start the year right and we're going to talk about how you can become the most trusted voice in your space.
Paul Green:
Oh you are going to love that next week. Marcus is an astonishing guy. The content marketing ideas he's come up with are astonishing and next week's interview, our first for 2023, is also going to be astonishing. Next week you'll hear why you must put your prices on your website. You'll hear why you must invest more in original content next year. And why you must must must do more videos. Join me next Tuesday and have a very profitable week in your MSP.
Voiceover:
Made in the UK for MSPs around the world. Paul Green's MSP Marketing Podcast.
