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Autotask: If you think the market for IT services is big, just wait for IoT services.

IT support IT support

Autotask helps IT support firms run their businesses better. Now, it's urging them to switch their focus from millions of PCs to billions of 'things'.

Once upon a time, there was no IT.

I know. Horrible thought.

Businesses used pen and paper and ledgers and people to take care of organizational tasks.

Then IT came along to automate all the boring stuff. Within a generation, every kind of business – from the multinational to the SME to the coffee shop to the school – was using computer software.

That revolution gave rise to a vast new IT support services industry. Thousands of managed service providers (MSPs) emerged to supply kit and expertise to these newly digital organisations.

In time their role changed. First they installed computers, loaded up software and showed their clients how to use them.

Then they began designing bespoke programs and running training courses.

Latterly, the more advanced among these MSPs came to a realisation: maybe we should write some software to manage our growing diversity of IT support products and services.

Software that tells us which customers are using which services, where our technicians are etc etc.

Finally, they did what so many digital businesses had done before them and thought: let’s forget about doing it ourselves and log into a specialist SaaS solution instead.

And so – finally – we come to Autotask.

Though you may not have heard of it, Autotask has been one of the stars of cloud services in the last five years.

The business started in 2001, and grew steadily until it was acquired (unusually) by a private equity firm, Vista Equity Partners, in 2014.

The undisclosed amount was said to be for a ‘healthy nine figure sum’.

The deal was brokered by Mark Cattini, who had been made CEO of Autotask in 2010. Under his leadership, the firm embarked on an aggressive growth phase.

This comprised adding more staff at the company’s New York, Chicago and Los Angeles offices, and opening bases in London, Sydney, Beijing and Munich.

Autotask reported $20 million in revenue in 2010. It has declined to release revenue figures since. However, its stated goal is to be a $100m company.

The firm now has over 6,000 IT support customers in 93 countries, with lots of room to grow this base.

According to Cattini, the market is barely 20 per cent penetrated.

He says: “There are hundreds of thousands of MSPs out there using some kind of purpose-built solution. They may be running Microsoft Project and producing some Excel reports. We call them Frankenstein’s Monster solutions.

“We’ve been on a rocket ride and yet we still have just ten per cent of the market, so 90 per cent is greenfield for us. It’s a huge opportunity.”

But it will take hard work. The main area of resistance, says Cattini, is cultural more than financial.

“Our prospects understand the ROI we can deliver – that’s never really an issue.

“If you’re charging out $200 an hour for a technician and you don’t have a system that can accurately input their activities – and whether it’s a special project, double time or whatever – there’s just so much leakage. And it can really cost you.

“People get that. The bigger challenge is that often these guys have built their IT support companies from scratch, and you’re asking them to put what is essentially a new nervous system into their business.

“That’s a big undertaking.”

This explains why Autotask has invested so much in support staff and also in making available existing happy customers to sell the benefits of its systems.

More recently it’s been on the acquisition trail too. In September 2014, it bought CentraStage, a UK company that does remote monitoring and management (RMM).

In other words, it lets IT support technicians take control of their customers’ machines and software remotely. They can do upgrades and repairs without even needing to visit the premises.

It’s easy to see the appeal of merging the original Autotask cloud service with this remote management piece.

Cattini says: “Traditionally, professional services automation and RMM have been two different things. We’re integrating them into something new.

“We don’t even know what to call it yet, but it will deliver incredible value to our customers.”

While existing market conditions look promising for Autotask, Cattini believes an even bigger IT support opportunity is on the horizon.

And it may not be a big surprise to learn that it centres on the Internet of Things.

Think about it. Mobile, wearables and sensors hold the potential to turn every dumb product into a digital service. When that happens, the need for professional support services will explode.

“The revolution hasn’t even started yet,” says Cattini.

“I’m a big believer in the IoT. Delivering basic IT support is all very nice. Moving from on on-premises software to cloud? Yeah, that’s important

“But if I run an enterprise I should want everything to be mobile. Every business function and application, both inside the business and customer-facing, will have to connect to phones and wearables.

“We’re not even close to that yet. But it’s coming. So if I’m an MSP I should be thinking: where’s my specialism? After all, the devices may be different from PCs and laptops, but they still need to be managed, secured and integrated.

“MSPs should be sitting down with their customers and talking about all this. They should be thinking about specialising in certain areas because the bread and butter stuff is becoming commoditised.”