Vlad Mazek – Vladville Blog

Long story short: one. Is your business a highly skilled technology provider or a flea market with a bunch of random crap? Because, shocker, only one of the two is a high paying / high margin enterprise.

On my world tour with ExchangeDefender I’ve discussed this with a lot of partners as they list one obstacle after another that is holding them back and keeping them from breaking out to the next level. For most, perfection is the enemy of good enough: Remember how many people bought a Celeron-powered SBS server from Dell with 2GB ram just because it was on the back of a magazine? How about Windows Me and Vista and 8? In business you are constantly facing challenges and disappointment be it with technology or people – but the goal is to keep on moving forward.

One of the things that I am proudest of in my career is what we’ve been able to do with Shockey Monkey – we gave so many people the tools and services to help them establish an MSP practice and grow a process oriented technology business for free. Now I’m doing it again with the ExchangeDefender migrations, taking the annoying bits of work that IT people shouldn’t be doing in the first place, and giving partners that much needed influx or revenue and client base that can be serviced at a higher level. It’s all about defining your value.

Value Proposition

You only need one.

I’ve met many partners that get confused by garbage marketing toolkits and marketing copy in a trashcan or whatever the current hip name for writing essays as marketing happens to be. But Vlad, it works and it keeps me accountable! Yeah, but what kind of people does it bring in – cheapskates with essay like technology problems.

Your problem typically isn’t that you don’t offer enough value points. It’s typically that you offer the one that the clients care about the least.

Simplify it.

Why did the client call you. Unless you’re a mind reader the best way to figure that out is by saying the following words: “How may I help you today?”

MSP sales are ridiculously complex but the business decision (as in: the problem the guy who owns the bank account cares the most) is quite simple:

We have some IT problems that we don’t have the time to deal with and we want the problem to go away without causing others or costing us more.

Building your value tagline out of that problem should be relatively simple.

But if you hit someone with a 50 point bullet list like you’re Microsoft trying to sway someone away from buying Vmware… all you’re really doing is shooting yourself in the foot. The business owner is sitting there thinking: I don’t have the time for this 50 questions shit, I thought I called these people to sell me on saving me time from dealing with tech problems but it seems like I just got another inquisitive idiot employee. Hold on, let me let you talk to our technical person. If you ever got that treatment, you lost.

Business values are simple as is a company mission – be it one employee, ten or hundred. You exist to serve a certain kind of customer and solve certain kids of problems. Don’t try to copy someone you are not or market with the content that doesn’t appeal to the kind of a client you don’t want.

Define yourself and let the market come to you.

It’s the new year and the opportunity for every blowhard to blindly toss their darts on the wall of IDC and Gartner data and proclaim the next cash cow. And with that in mind, the future is robots and drones which through a innocent mistake by the summer intern flip the bit from delivery to repossession and Amazon ends up with everything you’ve ever bought for them. And they’ll need it – in 2014 Amazon gets hacked beyond belief and needs to fortify it’s headquarters to keep angry customers who lost their life savings in the identity theft. Google comes out with a car that can drive itself around the obstacles placed in the road by Bezos & Co and Microsoft naturally responds by adding smartphone functionality to a NERF foam rocket launcher, marking it’s most significant innovative contribution to the field of security since retiring ISA.

I don’t know about you, but that’s sort of how I feel when journalists that don’t work in the IT industry take guesses about the industry. Kind of how like I’m a world class chef because I’ve seen Mario Batali cook a trout on Food TV.

That said, here is how I’m spending my money.

Unemployed on Easy St

The bottom of the IT world has fallen out and it will continue to erode. There can only be so many Verizon employees out there and IT ain’t hiring: If you’re only capable of answering simple technology questions and following a simple cookie cutter process this is going to be a rough year.

The reality of our industry is that everything that is easy is getting automated and everything that is automated and measurable will be controlled by the vendor in order to eliminate third party middleware from becoming a part of the picture.

It’s not just mobile, it’s the variety

So many people predicted that BYOD and MDM were going to be the biggest change and indeed the solutions arrived with a massive thud of indifference. Truth is that everyone is concerned about the mobile and sees it as a major game changer in corporate IT – but the reality that nobody wants to spend a lot of money for something that doesn’t manage 100% of the end-to-end solution is the rude awakening to the dream of controlling everything and anything – especially when the corporation doesn’t actually own it.

Going forward, the challenge will not be “managing” these devices but pointing out the issues and addressing them before they become a problem. This means having data to back up issues related to how the work gets done and reacting to changes quickly. A year ago it was all about getting a handle on iOS or Android, now it’s a matter of a lot numberswiki.com

more than just two mobile operating systems.

It’s not maintenance, it’s project

Getting paid just because stuff works is no longer a viable future business model when stuff doesn’t actually break a lot. If you’re in the camp of “But my clients still have XP, it will take a long time for…” I hope you’re actually investing those profits to be ready for the future that not only doesn’t have Windows XP but has a built in video help system that came for free. Would you put any of your techs in front of a webcam and stream them to your users?

The area where IT talent will continue to be massively profitable is projects with organizations that made massive investments in IT and need to keep it up. There are still ads for AS/400 admins out there.

I like a lot of what Vlad says but I don’t agree with all of it

Translation: “I only like the opinions that fit my own biased view but the rest of it is just crazy.”

The way we look at the rest of this decade, as far as where we can play, is to focus on the backend services that will help consolidate the massive surge in different services people rely on. Email remains the single sign on protocol of the Internet and also the single point of transaction records or backups (everything relevant to what you do on Facebook, Amazon, Twitter, etc is also emailed to you) – not by accident either, all these services need to find a way to keep dragging you back to their sites – and if you aren’t typing in the URL or launching the app then they need to prompt you to do it: Facebook wants you to wish someone a happy birthday, LinkedIn wants you to congratulate someone on their new job, Pinterest thinks you’d like to turn an empty roll of toilet paper into a cable extension organizer and the former Prince of Nigeria still needs your help to get his billions of dollars out of his war torn country.

We are aligning our business (ExchangeDefender) with our partners and taking over mindless tasks related to email migration projects. We are extending the service management to include these new communication protocols. In a way, we’re using our size to grow the portion of the business that doesn’t have very exciting long term prospects in order to have a larger deployment base for the service that helps manage multiple communication and notification networks.

Truth is I can’t build a Nokia and I’m not brave enough to launch a drone: But I know that business gets done through talking and so long as I can make sure people can talk (and can keep the content of their conversation secure) I’ll be alright. All the gadgets, fads and hype in between is just noise and we don’t get paid for that.

My head is spinning from all the amazing conversations I’ve had this week and I wanted to offer a bit of an explanation regarding my animosity towards VC involvement in the SMB space. As I hinted previously I am working on building another business and have had the “pleasure” of spending some time with the attorneys and consultants that specialize in the financial world. On one hand I’m incredibly thankful these folks exist, on the other hand it makes me long for the good ol’ days of $500/hour IT and corporate law attorneys charge. Yes, my butt hurts.

And on the subject of anal rape, why the hate towards the VCs? First of all, I don’t have a problem towards the model itself – venture has a place in the world helping larger companies get even larger, helping fund projects banks would otherwise refuse to undertake, helping finance complex deals and provide the means for all sorts of debt reduction, leveraged buyouts, etc.

Which in short is the exact same reason no small business (let’s say under $100m) should ever deal with one. But don’t take my word for it: Go talk to someone that has taken funding without a clear exit strategy that involved the IPO. What they will inevitably tell you is that even though the VC typically steers away from day to day, they shackle the kind of big picture and strategic moves that help small companies make it big.

But how could this be? Isn’t it common knowledge that VC is the very fuel that helps companies grow in the first place? Yes. Big companies. That you can count on your hands – the rest of them are in essence private money that is putting the money on either red or green and only hoping for the ball not to land on black. They’ll take losses and they’ll take big wins but nothing in between works. You can’t just build a highly profitable business with a long term strategy: You have to blow it out of the park so they can either win big or cut their losses.

Now that you know..

What is the lifecycle of a funded company that doesn’t go public?

Well, they’ll let it ride forcing big moves and expenses. While the illusion of grandeur (most of the time a delusion) makes things look amazing the course is to make even bigger and bolder bets.

But once things slow down a little, things get ugly. The employees that are working below their market worth get antsy because they want to be bought out. Things are always on track, everyone is winning (except the employees) and you’re just one step short of retiring to your own private island. But then your boss starts getting really interested in your expense report. And your hours. And your conversations. And increasingly trivial big projects while the costs are cut left and right. How can a company be blowing up big time and at the same time selling it’s Aeron’s on Craigslist? Because it’s being gutted, books cooked and working towards being served to a scrap buyer that might make more with it than the sum of it’s parts.

While this may sound ugly and heartless, this is the norm and this is the process. These folks aren’t evil, they are after returns. I ain’t mad at them.

But the part I don’t like is when a small company, who let’s face it lives or dies on the passion of it’s founders, is shackled and distracted towards someone else’s agenda. This is not VC’s fault: they aren’t funding you to believe in the magic of your dreams. It’s more of a steroid shot.  

Borrow money from the bank: It’s your name, your credit, your decisions, your call all the way. But get taken over by the VC and well, for the convenience of not having absolutely assessed risk you are trading away your ability to control your own destiny. Yes, even if you own 49% you’re still a minority and now you work for whoever owns you.

That is my beef with the VC world: People do business with people. And when that trust is broken and it’s a matter of customer vs. logo and everything else be damned, the small business and innovation loses it’s spirit and it’s potential. I have seen so many friends and so many great business and ideas get ruined in this process.

And it’s that process of killing a successful long term business that I mind the most: When people take a shortcut that both mathematically and business-wise leads to a fundamental change in the values. Because people aren’t throwing money at you to keep on doing what you’re already doing well, they are doing it to maximize the leverage and get their returns to grow faster than they would than if they gave you a loan.

Money is simple that way: It just wants to make more money.

Thanks for your concern, I appreciate it.

Pretty misplaced though. Things have been going so well that it’s hard to believe and I’m one of those folks that doesn’t really get much easy in business: so when everything is going well I try to figure out the ways it could all go to shit in a heartbeat and stay ahead of it.

The migrations business we introduced in October has been insane. We will be launching a hiring spree in January that will likely double us in 2014. Shockey Monkey and our mobile solutions have been maturing and due for a huge release shortly. Ditto for the Unicorn remote support and monitoring tool.

That said, the move from a pure software to a service business has not been easy. Far from it, unfortunately. Even though it’s been a grueling, grunting, bruising exercise it’s what gives me faith that we will more than double and become an irreplaceable component of our partners strategy in 2014 and beyond. Here is why:

Every time we get burned on some service aspect I hear the following: “We need to better define what we will not do and not touch so we don’t have to do this again.”

My response is always the same: No. It just means we need to ask more questions and define a better process for it the next time.

If you can sufficiently define the scope of what you’re willing to do and not there is no limit to the amount of business you can lose. And in real life people don’t grade on the curve or love you for what you do for them – they judge you by how often you’ve failed them and how many mistakes you’ve made. Trust me, I’ve got refund checks to prove it.

So how do we move this forward? Well, as I discussed in this weeks webinar it’s all about surrounding our partners with the end-to-end solution: marketing that makes sense, process and support that extend it beyond just tech work, mobile strategy, support strategy and coming soon – a training strategy.

The strategy of the service business is simple – do whatever it takes to get the user to the cloud, once there make sure they leverage the power of the cloud. This has been a bit of a tough bargain between me and some partners that want their clients to be limited and kept in the dark on many of the features but what’s the sense of going to the cloud if you’re going to keep the same crappy process that’s gotten the on-premise solution to choke in the first place? A lot more on this later.

Quiet Time

Although I haven’t had the time to blog here as much as many of you would like, I did also hear and notice that the “channel” has been kind of quiet too. It’s a sign of maturity – by now all the hype has kind of died down and only a handful of vendors have proven themselves to be trustworthy and capable of innovating and moving their partners up.

The rest are being unwound, cost controlled and being financially book cooked for a sale (garage or rollup); it’s a natural progress of any business particularly the short sighted one.

As far as I can tell, IT in SMB is doing really well or it’s going out of business entirely. It’s somewhat polar: few really big winners and many losers. And when you’re doing really well but see the carnage of Marketing-In-A-Can and Indian-In-A-Box MSPs and VARs all around you then you probably thank your lucky stars and try not to brag too much about it.

I of course wouldn’t really know much about the humble part but I know this much: It’s one thing to be a perpetual hype machine and quite another to be a valuable revenue generator. Any jackass can throw a great show and be the next big thing, but after the champagne bubbles out and people go back to work and start solving true business challenges they are back to dealing with the real world problems and people problems. That’s where we’ve been for years and that is where we’re moving to become even more valuable in 2014: It’s just a whole lot more work. But given the choice of more work or unemployment is an easy one: None of you would make it working at a Verizon store.

Before I share some seemingly pessimistic and insensitive commentary, that is written in a hope of helping motivate you, let me say that I understand and I relate:

I too am pissed off about not getting stuff I don’t deserve. I don’t like many aspects of what I have to do in order to obtain the kind of life I want for my family.

But I have no other options. I’m just not pretty enough for porn.

Now that we have the Vladville tone firmly established, let me share a post from Facebook that I thing highlights the challenge of compromise in corporate America – and how it transcends the plight of minimum wage and is even present in every day mental handicap of many people you may have working with you across all levels of income.

http://www.forbes.com/sites/rickungar/2013/11/18/walmart-store-holding-thanksgiving-charity-food-drive-for-its-own-employees/

Mixed feelings on this one… Yes, it’s sad. Yes, that is what happens on minimum wage and it’s sad. But if that is not the incentive NOT to stay at the bottom and show 0 effort then I don’t know what is. No, not everyone can be a CEO and not everyone is going to get to waste 4 years in college, but “I do my job, give me more than you agreed to pay me for it” is not going to end well. That IMHO is the true “entitlement” in USA, expecting more for not doing more — not the food stamps that help people that get stuck in minimum wage temporarily.

Now every time you post something about doing the bare minimum the defense points from the more compassionate people are always the same: 1. Minimum wage is not livable wage 2. Many people cannot afford to move to a place where there is more demand and thus higher pay for unskilled labor 3. Employers should just pay people more. Fair points but unrealistic in the economy and legal system we have – income disparity is in place to reward people who can maximize profits. End of conversation, you can disagree with it and bitch and moan about it’s unfairness but it’s all about the highest score at the end of the game and nothing else matters.

Now, I shared the above in the typical Vlad compassionate way and was told the following:

“This store is 5 minutes from our house, and it says a lot more to me about opportunities here, than Walmart’s wage structure. We are a community engulfed in brain drain, it’s not that people don’t strive to provide for themselves, but far too many of them have to leave here to accomplish it. I’m sure you are not often accused of being an optimist Vlad, but incentive and hard work don’t seem to be worth as much here.”

The key word is “here”: If your work is not being rewarded then you need to get the fuck out of “here” and move elsewhere.

The Solution To Economic Class Warfare

Walmart is not an inherently evil corporation, it is an American corporation that behaves in the same soulless way that they all do: their job is to maximize corporate profits that are reinvested in further growth or dispersed as dividends to it’s shareholders who spend it, donate it, reinvest it or otherwise. In order for Walmart to continue to grow it needs more demand and more people.

Raising pay would be a suicidal move for Walmart because it would impact it’s margins or raise the cost of goods sold which would make it less competitive with Target/etc. So don’t hold your breath waiting for that to happen.

The only way Walmart, McDonalds and other minimum wage sweatshops will raise their wages is if there is less available labor that is willing to work for minimum wage. And how do people stop working for Walmart? Education, moving to an area with more opportunities, starting up a business, etc – it starts with people not willing to put up with shit deciding to make a change.

But most people don’t want to be inconvenienced: I like where I live. My family is nearby. I don’t have the time to get a degree or enroll in a vocational program. I don’t want to move. I don’t like those hours that pay more because I want to spend time with family. Insert $WHINING $BITCHING $MOANING, it’s someone else’s fault.

And you see, fellow Walmart Associate and everyone else unhappy with their pay, it is not someone else’s fault that you are making excuses instead of doing something. That is not injustice, that’s your inability to accept inconvenience and sacrifice. If you look around a little and see a whole bunch of people doing better than you.. unless you are surrounded by Kardashians, those people had to go through a lot to get where they are and they feel very little sympathy for you.

Wishing and hoping and praying may make you feel better but that temporary comfort will not change things or make them any better. As much as it may appear that some folks have it easy, barring something illegal, in this country we work for rewards. Yes, the more you work the more disproportionately you get compensated eventually compared to those who show no effort at all, but knowing that fact.. right now.. you have the opportunity to do absolutely nothing or do something.

An optimistic person would tell you the truth and implore you to work harder towards what you want. A pessimist would blame something instead of doing anything.