In this podcast episode, Adam Morris speaks with Mark Lamb, founder of HighGround, about his journey from running a Managed Service Provider (MSP) to developing a software product. Mark discusses the challenges of helping customers understand their IT spend and the transition from service-based to product-based business models. He elaborates on the mistakes made during the software development and the lessons learned, including the importance of visually demonstrating IT spend to customers. Mark also shares insights on the evolving role of MSPs, the importance of a VCIO, and how HighGround aims to enhance MSP sales and cybersecurity posture. The episode concludes with Mark providing three tips for MSPs looking to develop software products and reflecting on the future of IT services.
00:00 Introduction and Setting the Scene
00:12 The Origin Story of High Ground
00:26 Challenges Faced by MSPs
01:35 Transitioning from MSP to Software Development
02:27 Lessons Learned in Software Development
04:38 Funding and Initial Development
06:00 Pivoting the Product Focus
06:56 Launching and Iterating the Product
07:50 Emotional Journey and Team Contributions
09:24 Top Tips for Building a Software Product
11:07 Addressing MSP Client Challenges
14:16 High Ground’s Visual Tools and Features
19:53 Future Vision and Industry Trends
27:41 Conclusion and Contact Information
Listen on Spotify or Apple Podcasts
Connect with Mark Lamb on LinkedIn by clicking here –https://www.linkedin.com/in/mark-lamb-13077918/
Connect with Daniel Welling on LinkedIn by clicking here – https://www.linkedin.com/in/daniel-welling-54659715/
Connect with Adam Morris on LinkedIn by clicking here – linkedin.com/in/adamcmorris
Visit The MSP Finance Team website, simply click here – https://www.mspfinanceteam.com/
We look forward to catching up with you on the next one. Stay tuned!
Transcript:
Adam: Hi Mark, good to have you on the podcast and, good to see that you’re all wrapped up warm there because it’s a particularly cold day, isn’t it? especially up in Scotland.
Mark: Winter in Scotland, yeah.
Adam: so look, perhaps we could just kick off with, a bit of history here and see if you can understand what the origin story is for High Ground and why you’ve gone down this route.
Mark: Yeah, absolutely. we, as an MSP owner and founder, myself, We had the challenge of trying to help customers understand where their money goes. They just think that the more they spend on IT, the better everything magically becomes. But, as we all know, IT is just, there’s more and more things to spend their money on.
Mark: And, got really fed up with being blamed by customers about, you know, You know, they look at their P& L and how much they’re spending on IT and we would get all the flack for that when actually they spend a lot of money with other vendors too. And, increasingly difficult to sell services that the customer needs because, you know, they just feel like they’re spending too much money.
Mark: So we were trying to address that problem while simultaneously. Get them to spend more money on their cyber and really show them what their posture looked like. in the midst of trying to solve that problem, we actually developed our own product, which initially was called, named after our stack actually.
Mark: And then we rebranded it to High Ground just a little bit later.
Adam: Where did the name High Ground come from?
Mark: it’s from the general idea of getting the high ground on what’s going on. the visibility. But we didn’t want to come up with another name that everyone else has used, so High Ground seemed sensible.
Adam: So just elaborate a little bit more for me, if you like, that kind of pain point, what you experiencing with your clients and, you know, what led you to actually stepping out of your comfort zone as a, as an MSP owner into software development.
Mark: I would, on the second part I would say it was naivety. I didn’t really realise what I was doing. before I knew it I woke up one day and I’m so deep in this thing and we’re building it and then got an absolute schooling on how difficult it is to build software.so that was, Yeah, it was certainly not like, you know, a background in software development and thinking, oh, we should do it.
Mark: I think when you’re in IT, you kind of think you can do everything in IT. And, that’s really not true. I’m four years more experienced in it now than I was when I started, but I feel like I’ve made every mistake along the way and doing so.
Adam: let’s just do this, actually. Mark, let’s just talk about some of those mistakes, you know, what, whilst, and then we’ll come back to the other point perhaps, because I’d be really interested to know, what did you learn? you know, what did you assume would be easy in pivoting and building a different business?
Mark: just, I didn’t, I think that when I was approaching building software, I just thought it was like building an IT system. It’s like building a network. It’s like building a configuration. What you don’t realize is that every single little thing has to be decided upon. And, you don’t realize until you’ve built a piece of software, just how much thought has gone into it.
Mark: Even the, even like the placement of a button and the colour of it has to be decided by someone. And then next thing you know, you’ve got 150 buttons and they’re all sort of different colours and different positions. And they say different things like the universality, if that’s a word, like that, those little things, they really compound and compound to just Get you.
Mark: And then when you’ve done it before, you know, what pitfalls, you know, to avoid. I think as well, building a product is a product. I, an MSP is a service-based business where a product is a product based business and they are very different business models. And so that’s probably the second biggest thing, or maybe the biggest thing I learned is you’ve got to really change your mindset when you’re doing it.
Mark: And, your natural inclination is to build service offerings around your product. But if you want a product that can scale, you really don’t want to be curtailed by services on the site. Also, when it comes to selling a software product or selling a software business, you know, the multiples on service revenue are nowhere like they are on product revenue.
Mark: So things like that, they seem simple, but they’re really fundamental.
Adam: and in a way you took the hardest route because, The common wisdom is that you, in order to expand, if you like your, your revenue of, revenue full stop, you know, the first thing is either sell more product to the same people or sell the same product to new people, what you’ve done is created a new product for new people.
Adam: So it’s kind of, you’ve made it the hardest possible thing ever. tell me about how you started it. how have you gone about. getting the development work done itself. how have you funded it?
Mark: Yeah. So we’re funded it entirely out of our own profits. we have, there’s no one behind us. There’s no, no one pulling our strings. So the good thing there is that we’re really, truly building a product for like, you know, for the interests of ourself, well, not for ourself, but for MSPs. But because we are one, we’re solving our own problems, which I think is more valuable than anything else, because you really deeply understand the, especially when people want changes, like.
Mark: You’re thinking to yourself, is it, as we say, is it pink and blue buttons or is it actually material, materially important? As for when we started building it, I believe it or not, it was like a month after COVID first lockdown. I was getting a, we had survived the flood of tickets and yeah, no one’s, you know,
Adam: Happy days.
Mark: well, yeah, looking back on it, I think it kind of was in some ways, but the, you know, we were kind of really worried at that time that customers were going to start cancelling their agreements and, you know, we were going to start losing massive amounts of revenue and we just kind of came through it and things settled down.
Mark: I think I suppose at that time, there was a lot of optimism that. You know, this was only going to be a few weeks, and we would all be back out of it. Obviously, at that time, nobody knew. And we had a little bit of cash, that we thought, you know what, we’re going to try and build that. And so we started with, a local development, development, or developer in a local area that we knew, that we had customers, had work done with them.
Mark: And that’s how we started. And then, it sort of evolved and evolved. One of the things that really did wrong, is a really sh
Mark: At the time, I didn’t think that MSPs would want to buy a product by an MSP. Even today, I’m having conversations every day with MSPs and some of them find a problem with it and some of them, they love it. The further away they get from where we are in Scotland, the more comfortable they get with it.
Mark: That’s probably natural. but that sort of like thought was with me and that caused me to build a product for the wrong people. So the very, the first two years of the product was actually more focused on a product that was good for IT managers and corporate IT. It wasn’t actually focusing on MSPs until I met some fairly influential people in the industry who said, Mark, you need to build this MSP product.
Mark: niche down on MSPs, solve the problem that you know how to solve, and, go that way. So we basically at that point had to start again. In hindsight, we probably should have just started completely again, but we salvaged what we had and carried on. And, that was that. And so it took us all the way up till April, the 2024, I’m losing track of the years here, just April gone past.
Mark: We launched the first version of it, and, we had about seven or eight MSPs giving us a lot of feedback. We couldn’t keep it going. because we’re running the MSP and trying to build the product and deal with people using it, despite how many of them kept messaging us saying, look, can you please, you know, can we please just use it even in condition it’s in?
Mark: We’re like, it’s too difficult. We took it down and then we re released it just at the very end of November. But then we ran into Christmas. So we’re only really in earnest starting now.
Adam: and the development guys you worked with, helped translate a business problem into a product. Or was that you or someone else doing that piece?
Mark: That was me. I actually have to give credit to that. It was me, but I was working with a good friend of mine called Serhii, who is Ukrainian. And he’s a UI, senior UI designer. And he, but he understands business. And so we work together. I really learned a lot from him about how to, you know, how to take things that I see as like, this is how you solve the problem and this is where it should be to, you need to generalize it because everyone does it in a different way.
Mark: And I worked with him, yeah, for four years. This sad part of that story, he’s actually just been, he’s just been conscripted into the war. So I just lost him three weeks ago. not dead, but he’s gone. He’s away. So in some ways, a lot. There’s an emotional side of Hagrid now for me, which is he wanted nothing more than to see it succeed.
Mark: And I really want to make it succeed, because whether or not I see him again and he comes back and how it succeeds, I really want him to come back and be like, yeah, this is a massive, you know, success. And he comes back to, you know,
Adam: So he’s just part of that national conscription. Is that right?
Mark: yep, he’s, he’s in the, in the Ukrainian Marines, doing, drones. He’s an electrical engineer to trade, so he, I’ve got so many funny pictures of like us working on the code and he’s literally got a 3D printer printing like, grenade droppers for drones and stuff that he’s working on this side.
Adam: Wow. So this is like firsthand kind of experience. well, at least he’s behind enemy lines as it were.
Mark: Yeah,
Adam: behind enemy lines? No, I mean,
Mark: Away from front
Adam: Yeah, not behind enemy lines, as it were, well, best of luck to him. okay. I’m going to put you on the spot, three tips then for someone like yourself, who is looking to build a product, a software product. would you say to them? Top three tips.
Mark: Oh, an MSP building software product, would you say?
Adam: do that.
Mark: do. This is zero, this is low code, no code. I wouldn’t even write a line of code. I would prototype it in a tool like, like Figma, even Webflow, something that you don’t even build it. Pretend it’s real and get it out in front of people and see what they think.
Mark: Get that feedback as early as possible. Just preserve your money because building it is expensive. So that would be the first thing. Second, I would say be very careful who you get to build the product. Like You really need someone on it absolutely focused full time, like a product manager, you would really, you know, an architect or a product manager, you can mix the roles, but don’t overlook the importance of being ultra, ultra close to the product development because just when you think it’s ready and it doesn’t do what you need to do and you find out there’s a millions of things that were missed because nobody was looking after it.
Mark: And probably the third thing is, if you’re not solving a problem, don’t, but don’t even bother starting. You’ve got, there’s got to be pain. we all want to build product that’s a gain. It’s like, oh, this is going to be exciting, but it has to be fundamentally rooted in the pain. If you’re not solving something like that, a pain, you’re not taking a pain away.
Mark: Unless your product is like, you know, next level tech. I wouldn’t even start.
Adam: Yeah. Having that clarity of vision, clarity of the problem you’re solving is vital, isn’t it? so let’s get back to that problem. let’s just dig a little bit deeper into it. Can you just, elaborate a little bit more about what you were saying about the problem that, you know, MSPs have with this.
Mark: Yeah. So customers, because. The MSP is a prominent, provider of technology. The, you know, when something’s broken, they call us. If they’re looking to buy new equipment, they’ll often call us. the more and more you do as an MSP as well, the worse this problem becomes. You know, the more and more services you sell, the more of a one stop shop you are to the client, the more and more they think of you as everything to do with IT.
Mark: which in many ways is good for us. But when it comes to investment and spending money on technology, it can actually work in reverse in ways that we don’t even realize are happening. I’ll give an example of a cost that we’ve, I’ve got a one client in mind, particularly that we were having a really hard time with them about how much money they were spending on it.
Mark: And we’re like, I just don’t understand what the problem is. Like they’re getting so much value for money until we were using high going with the client and. They were like, we don’t spend 40, spend 97, 000 or something like that. I’m like, no, you don’t, like you don’t spend that with us. And we’re like, well, so we pulled up high ground and we’re showing them what they spend with us.
Mark: He said, well, where’s this other money coming from? And he said, well, we’re spending this money on this piece of software and this bit of development we’re doing. And we’re like, it turned out that was over 50 odd thousand of what they were spending. Now we were getting the heat for all of it because they just think IT.
Mark: The look at the budgets, you know, it’s their fault and given us a lot of grief, I should say, so we can easily turn the table on that, but that’s a perfect example of what most MSPs are going through and what most customers think and, It’s scary to have that conversation with your customer when, because what I’m finding is more and more MSPs are running with less clients than previous, that they’re getting much smarter and saying, I don’t want a great big long list of customers.
Mark: I want a smaller list of customers that I can provide a better level of service to, which amplifies the issue of every customer is more important than, you know, having lots of them and they dilute the client mix. So you don’t want to upset your customer. And so you’re kind of taking a little bit of. of grief from them because, well, we all say, yeah, I don’t like the customer, I’ll get rid of them.
Mark: But it’s not as easy as that in reality, is it? And therefore, it’s really important to be doing it in a consultative way. And MSPs are really great at selling consultatively. And there’s a real theme in the industry of people saying MSPs are not good at selling. I don’t necessarily, I think MSPs sell accidentally.
Mark: They kind of make the product obvious that the customer needs to buy it, but they really take the long way around in doing it, and they could be a lot more efficient and a lot more effective. And that really comes through being able to meet the customer where they are. So making it simple, making it visual, talking in their terms, in their language, and helping them understand and staying away from technical details as much as possible.
Mark: And so that’s what we do. And High Ground is built exactly to do that.
Adam: And if you describe what it does in a sentence,
Mark: Yeah, it’s, in a sentence, it’s a sales tool for
Adam: It’s a sales tool premise piece. Perfect.
Mark: Yeah.
Adam: yeah, you know, this is a conversation we have regularly, on the podcast with our clients in general, you know, how do you ensure. You are focusing on what the client perceives as important, and you’re building that relationship.
Adam: You’re not just bombarding them with jargon. and how do you therefore translate something complex and technical into business language and simple, because. Our, you know, our, client’s owners are busy people, aren’t they? You know, and the last thing they want to be doing is spending time on, on something they don’t really understand.
Adam: so how have you gone around, how have you gone around, you know, resolving this problem, if you like, or making it easier for MSPs to solve this problem?
Mark: So really leaning into that point about MSPs being accidental salespeople, the very nature of how an MSP kind of gets going, if you look at the hereditary of most MSPs, they’re typically set up by either a technical person who was just really good at what they did and they thought I could make a business doing this and then they hire a whole bunch of techs and then they realize what they’re doing a little bit later on and then their life’s difficult.
Mark: Or the other thread is that you get really sales driven people that, or finance driven people. I think you could say universally financed people are always really good at setting up businesses because you run the business by the numbers. But sales people for sure, there’s a theme of sales, really sales enabled people that are, and they’re the ones that grow really good, really fast.
Mark: Oftentimes they’re also the ones that have terrible technical service because, because
Adam: They don’t understand it.
Mark: don’t understand what they’re doing. Yeah.by leaning into the accidental sales part, which is largely the majority of these MSPs who set up by technical people. What we’re doing is by, what they’re very good at is talking to the customer.
Mark: They’re very, often very good at holding relationships with clients. They like to look after them. Same reason why they don’t put the prices up because they don’t want to upset them and they value the relationship. Same reason why they give things away for free. Because, you know, the business model is a customer intimacy model where it’s all about looking after them and it’s relationship based.
Mark: Now, if you understand that, then the best way for an MSP to make sales is to have a tool that actually meets their needs because they want to sell more, but it helps the customer to understand it very visually. So they’re, when I say accidentally, what the MSP wants to do is they want to. The engineer, or whoever it is, wants to explain it all to the customer.
Mark: They want to talk to the customer about what it is. You’re never going to stop that behaviour. They can’t just suddenly say to the, say, MBCP owner, stop talking to your customers and do it this way. That’s in their DNA. High Ground allows them to do that, but it does it in a way that it’s already primed that they’re not going to go down the wrong road.
Mark: Basically, you’re laying the path out in front of them and they just have to go down it. And therefore, the customer will understand What’s going on? MSP is going to thrive in what they do well, and it’s all very visual. So that’s in a nutshell.
Adam: so just, give me just a couple of examples, I guess, of what some of these visualizations look like. and if I was the owner, you know, how’s it making it easier for me to get my head around all this?
Mark: Yeah. So the biggest one is technology spend dashboard. So we have a dashboard where we can pull all the data from the PSA and also manually enter data and we display on a very visual, very clean, Table of view, if you will, with a wheel, a pie chart that shows the customer, you know, you spent 50, 000 on it.
Mark: 25 percent went to Microsoft 365, 15 percent went on support, 4 percent went on cyber like That high level. So that’s probably the most striking visual. That’s the one you’ll see in a lot of our marketing. And, second one is, as you enter the, we’re using this Cybersecurity Framework radar chart.
Mark: So if you’re familiar with the Identify, Protect, Detect, Respond, Recover, we’ve taken an interpretation of the framework but used a very visual, we call it the radar chart. It’s like a five point, like a pentagon. And, We visually plot out their security. the further they are, like the stronger they are, say, in protection, the further out the, dot goes or the line goes out to the further access.
Mark: It creates a shape. And so we say, you show the customer the shape of their security and they can see, oh, I’m pretty bad and I’m okay in protection, but I’m really weak in detection and response and I’ve got no chance of recovering. Look at my recovery capability. And that is, Simple enough, but detailed enough for the customer to understand, this isn’t good.
Mark: And when you compare security posture, oh sorry, when you combine security posture with money, that’s when the magic happens, because now they’re like, okay, now I know where my money goes, I understand that, and now I know my posture, and I want my posture to be, Like this. And so with high ground, we build security packages to show them what we can do for them as an MSP.
Mark: So we build our packages in the same visual way. And when the customer realizes, Oh, wow, to get what I want, it’s going to cost me so much more than I can afford. They either have to come up with the money or they have to, accept some of that risk. And they ultimately have to make a decision, right, what they want to do.
Mark: As MSPs, we can never make the decision for our customers. We can try, but it’s not our decision. And so all these visuals really help with that.
Adam: And how do, how does this fit in then to an MSP that is already using some VCIO, uh, technology, plan, future type tool, for their clients? Does this sit on top of that? Does this replace it? How do they kind of, Merge this into their current, I guess it’s QBR type of cycle.
Mark: Yeah, that’s a great question. it sits alongside it. It’s something that you really should use together because if you can’t and it comes before it actually and if you’re already doing it then I think you’ll find a lot more of more effectiveness in that QBR process when you augment it with high ground and that’s because Often customers don’t understand why they’re going down this route.
Mark: QBR products today, you know, VCIO tools are either very risk based, they’re very technical, you know, we’re looking at a whole bunch of controls, we’re trying to meet the controls of a framework, most business owners and leaders really don’t know what’s going on, like they don’t, can’t really interpret that.
Mark: On the, maybe on the QBR side, The tools are a little bit better. We’re building the roadmap. We’re saying, right, this is how much money we need to be budgeting. You know, these assets need to be replaced. this is coming up and we’re budgeting quarter by quarter, but it’s all very detailed and, it’s good to, of course, to have the financial foresight and the plan, but what the customer still doesn’t really have is a picture of, where they’re going.
Mark: The vision for high ground. We want to create the ultimate account management platform, and actually we are working on that same type of functionality because we want to bring that capability. We recognize that functionality should live together with what we do, and we have, we’ve already got prototypes for that same style of functionality.
Adam: So your vision for the product actually is to engulf the wider VCIO planning component.
Mark: Yeah, VCIO and QBR, insights. So service insights, sales insights, financial insights, ultimately really true to the name. The name is a real point of, it’s the high ground and it’s not just a high ground security, it’s the high ground on your MSP. It’s everything that you would want to know and need to know.
Mark: And a real recognition that, or in recognition to the fact that MSPs are suffering with tool exhaustion. There are so many tools and they cost us so much money. And. Really, we don’t use a lot of them, we only use a little bit of each of them, and if we can take the most important parts of them all, and pull them into one, and make them work, and work together, and then mull, mull, drive insights from that data too, then it becomes extremely important, yeah, being the ultimate account management, I call it the ultimate account management platform, that’s what we want to create, but our goal to market at the now is very focused on just the sales side, and then cyber side, but, I’ve got huge plans to grow
Adam: So I know it’s very early days, for your product. so perhaps I should ask you this in 12 months time, but right now, which one gives you more grief, your MSP or high ground?
Mark: Oh, the MSP.
Adam: Like I say, I probably should ask you again in 12 months time.
Mark: You should,
Adam: where we’re at on that. so your product, isn’t just a security or isn’t just security focused, but is heavily security focused. Agreed. Is that right?
Mark: I agreed, yeah.
Adam: where do you see, this is kind of just a wider industry question, really.
Adam: I mean, what’s your vision? What’s your view of where the security component of MSPs is going? and, you know, How does that kind of focus, which was what everyone was supposed to be doing in the, you know, the late teens, you know, to switch to security first MSP, and now we’re being told to switch it to AI first MSP.
Adam: you know, well, what’s your view? What’s your view on where this is heading?
Mark: I think, the MSP is a bit like a chameleon. It’s one of these companies that will always change because it will change to adapt to the change in technology landscape, the change in business needs, right, to your point about, A. I, I think that I think we’re already in a place now where customers think of us as, as you see, like, well, they think that we’re the security provider, but they’re not necessarily calling us that.
Mark: I think that the old name of being called an I. T. Company will be around probably be
Adam: IT support views. Yeah.
Mark: Yeah, but I think truly what people really think and they expect that security has been taken care of and, I think security first MSP is a great way to describe it, but I think in many ways, many customers would say, well, don’t T companies do security?
Mark: Isn’t that a part of what they do? I think the next big sort of, area that we’re going to see huge expansion in is VCIO. I mean, we’ve already seen it in the United States. We’ve definitely seen an increase in it here in the UK. But the scope of ECIO is just going to grow. So it’s going to be technology strategy, it’s going to be security strategy, it’s going to be, What it really should be, which is business enablement, and, you know, whether it be systems, whether it be AI, whether it’s helping them be more efficient using tools, so on.
Mark: I think it’s just going to continue to change and evolve. I really see IT companies really evolving into what they’ll ultimately do is be great at managing relationships and making sure that. That VCIO role, which is they’re making sure all the right things are in the right places for them, but how it’s done, how it’s delivered is probably going to push more and more to vendors that are backing it with services.
Mark: So like you’re seeing now a SOC backed or not outsource knock. We’ve obviously seen a huge increase in outsourced sock. All of these kinds of things, I think there’s just going to be more and more of it. And actually, I was talking to someone just a few days ago about this exact point about, I think, the sad part of it all is that technicians in our industry, that they’re going to be, the skills are going to die.
Mark: A bit like when you’ve seen, you know, like, IT engineers that were in the 2000s that set up where they could fix anything with a computer, right? Because it wasn’t the information to, like, they weren’t so easy to use. I think you’re going to see a new generation of engineers coming through where they’re just experts on tools and they don’t actually know how to do anything for real.
Mark: They just know how to use the tools. And that, because it’s the only way to drive the efficiency and the standardization is to use these tools that automate the hell out of stuff.
Adam: yeah, I’m inclined to agree. and I think the. The MSP is an expert at understanding, well, listening and understanding to a business owner and, translating technical needs, to that business owner, the technical delivery is done by somebody else. and, the client doesn’t necessarily see that, they just see an outcome. but MSPs are all about that, boots on the ground, last mile relationship. Yep. and everything else is procured globally and delivered globally
Mark: You can definitely see that in the future, eh, with a scenario like, you know, don’t like your helpdesk, they’re not doing a good job at fixing your problems, no problem, we’ll use a different one. You know, don’t like your tools, we’ll use different ones. It doesn’t matter, it becomes abstracted from the client relationship.
Adam: Yeah. So I think the real skill set is staying on top of what your clients needs, understanding, you know, working on really understanding in deep, what’s important for your client, working out what that sector is that you can specialize in. That’s a good fit for you. and working harder at maintaining that trust and integrity and all those good things.
Adam: And, and all these changes, of course, just present more MSP market. They keep it complex for the client base, which means they continue to need us because it is so complicated.
Mark: Oh, yeah. I mean, could you imagine being a client? must be awful.
Adam: that, that’s why you want to find someone you can trust. And then you just say yes to what they ask you ideally, because you don’t have a choice otherwise. Do you? and that’s why it’s such a great business model. it’s been great having you on, Mark.
Adam: we’ve run out of time, unfortunately. but some really good stuff I think we’ve covered today. how can people get hold of you if they fancy a chat?
Mark: Yeah, you can get me on LinkedIn, or, send me an email mark. lamb at highground. io or just, check out our website, book a demo, you’ll get me. There’ll be more than
Adam: Brilliant. great. see you again soon, Mark.
Mark: Thanks for having me.