September 18, 2020
How Big Are MSPs?
Generally speaking, when people in IT think “MSP”, they think of a relatively small business. However, according to our annual State of the MSP Report, many managed service providers (MSPs) are actually larger than you might expect.
While 63% of MSPs have fewer than 25 employees, larger firms are becoming prominent due to industry growth and M&A activity—15% have over 100 employees. On average, MSPs report a client base of 127 clients. However, this number is skewed upward by the relatively few MSPs that serve more than 250 clients (16%). Most MSPs (69%) have fewer than 100 clients, up a bit from last year (59%).
The sweet spot for MSPs continues to be businesses with between 10 and 100 employees. 63% of MSPs said their typical client fell within the 10-100 employee range. Not surprisingly, 89% identify their clients as small or micro businesses.
Of the other 11%, some are serving very large businesses, even pushing into the enterprise. 5% reported clients with over 500 employees. As reported in Datto’s SMB Market Report for MSPs, MSPs usually move to serve larger organizations with a co-managed IT model.
It’s (still) good to be an MSP
When asked how long they’ve been in business for, respondents ran the gamut from seasoned pros to relative newcomers. Nearly 40% said their organizations have been around for more than 15 years, with many transitioning to managed services from another business model.
However, 18% have been in business less than 5 years, indicating that there’s plenty of room in the market and the managed services industry is attracting new blood. This is reflected in the 84% of MSPs that said now is a good time to be in their industry.
To learn more about the MSP industry today, download our 2020 State of the MSP Report.