Ribeyes & Revenue: A Masterclass on Growing Recurring Revenue

Introduction

Let’s face it — traditional IT sales models are on life support. Customers don’t want specs, CapEx, or disjointed service contracts anymore. They want simplicity, flexibility, and a seamless experience that feels more Amazon and less assembly line. For MSPs and VARs, this isn’t just a trend — it’s a survival strategy.

In this masterclass replay, we pull back the curtain on what it takes to pivot from being a gear-peddling VAR to a subscription-powered as-a-service provider. This isn’t theory — it’s battle-tested wisdom from a 15-year MSP veteran who bootstrapped his way to success, sold his MSP, and built a software platform designed to help others do the same.

Watch the video below to learn how to build recurring revenue streams, avoid common pitfalls, and meet customer demands with scalable solutions. 

You can also review the session’s key takeaways to get actionable insights and start transforming your business today.

Background: The Evolution of MSPs

The journey starts in 2006, with the founding of SecurEdge — a networking VAR (Value-Added Reseller) specializing in Wi-Fi networks for universities, airports, and healthcare facilities. Back then, Wi-Fi was a novel, often misunderstood technology, but the game began to change around 2014 as managed services gained traction.

With cloud services like AWS exploding, we began experimenting with subscription-based models. Could an MSP bundle hardware, software, and services into an all-inclusive subscription? By 2017, after a series of challenges, such as bootstrapping the business and figuring out customer financing, we found a breakthrough. Partnering with industry veteran Larry brought fresh insights into scalable financing strategies, setting the stage for transformation.

Understanding Customer Expectations in the Digital Era

Modern customers expect an Amazon-like experience — instant gratification, transparency, and flexibility.

• Digital Sales Platforms:  According to Gartner, 85% of customers prefer purchasing through digital platforms. However, many MSPs fall short of delivering seamless digital experiences.
• Flexible Consumption Models: The era of bulky CapEx purchases is fading. Customers now prefer consuming technology “as a service,” subscribing to what they need when they need it. Forecasts suggest that by 2025, 75% of tech deployments will follow the as-a-service model.
• Solutions Over Specs:  Today’s customers demand complete solutions, not piecemeal products. Bundling hardware, software, and services into a single utility-like subscription simplifies purchasing and increases value.

Leveraging Technology Finance for Growth

Larry, a veteran with decades of experience in vendor financing, sheds light on a critical growth enabler: embedded technology finance.

• A Growing Market: The tech sector accounts for 27% of the $1 trillion commercial leasing market, second only to transportation.
• Flexible Financial Models: Whether it’s leases, rentals, or loans, MSPs can structure deals to meet diverse customer needs. For example, bundling hardware and services into one payment simplifies procurement and boosts margins.

Key takeaway:  Customers are already financing technology — they’re just not always doing it with you. Positioning yourself as their go-to provider is essential.

Challenges in Transitioning to Recurring Revenue

Switching to an as-a-service model comes with hurdles, including:

1. Fragmented Systems: Many MSPs operate with disjointed PSAs, CRMs, and accounting systems. These inefficiencies slow processes and hinder growth.
2. Offline Workflows: Without digitized workflows, quoting and packaging solutions can take weeks, leading to lost deals.
3. Margin Erosion: Reselling someone else’s subscription model often eliminates one-time profits, making it hard to cover payroll.

To overcome these challenges, MSPs must adopt tools that integrate systems, digitize workflows, and embed finance options.

Five Things You Need to Selling As a Service

To successfully implement an as-a-service model, MSPs must master these five elements:

1. Modern Customer Experience: Customers expect transparency and real-time tracking similar to Amazon. With MSP Client Portals, you can deliver that seamless experience and take your customer satisfaction to the next level.
2. Connected Tech Stack: Integrate backend systems like PSAs and CRMs to enable seamless workflows.
3. Embedded Finance: Offer flexible payment options directly within your platform. With Technology Finance, you can grow your recurring revenue at scale while keeping things simple for your customers.
4. Workflow Software: Automate your quotes, approvals, and agreements with ease using quoting software  with smart workflows. Reduce delays and errors while streamlining your process—perfect for MSPs aiming to save time and boost efficiency.
5. Comprehensive Service Offerings: Ensure your services cover everything from installation to ongoing support, including the expertise of NOCs (Network Operations Centers).

The TechGrid Platform: A Game-Changer for MSPs

At TechGrid, we developed a software platform designed to streamline the as-a-service process. Initially created for internal use, the platform now empowers MSPs to:

•    Integrate PSAs, CRMs, and finance partners like Wells Fargo.
•    Automate quoting and financing workflows.
•    Present customers with flexible, customized payment options in real time.
•    Consolidate fragmented services into one bill, simplifying the customer experience.

Real-World Results

The impact of adopting an as-a-service model is clear:

• Higher Margins: Bundling services increases profitability by blending high-margin labor with subscription revenue.
• Customer Stickiness: Offering comprehensive, recurring solutions builds long-term relationships.
• Increased Valuation: Monthly recurring revenue (MRR) drives higher business valuations, making companies more attractive for acquisition.