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Welcome to this SPECIAL edition of the show, Episode 300, of the MSP Marketing Podcast with me, Paul Green.

This week I’ve got an incredible and motivating story of resilience.

700 nights of “will the business survive?”

Featured guest: Colin Knox is a serial entrepreneur and seasoned executive in the MSP and SaaS space. As the CEO & co-founder of Gradient MSP, he leads the charge in transforming how managed service providers operate and grow, with a focus on automation, billing reconciliation, and revenue enablement. With multiple successful exits, over $15 million in capital raised, and a track record of building companies from startup to nine-figure enterprise value, Colin brings deep expertise in scaling businesses, fostering culture, and navigating M&A. When he’s not building businesses, you’ll find him sharing insights on branding, leadership, and the future of the channel on LinkedIn.

Hello and welcome to a very special episode of the podcast as we celebrate 300 episodes. Every single Tuesday since November 2019, we have put out a brand new episode of this show, and today I have an astonishing story that you will almost not believe. It’s a feature length interview with a well-known vendor in our space who nearly lost it all a few years ago.

Imagine how you’d feel if your business lost all of its available cash in one day, and you had to fire most of your staff, and this situation was so bad that it didn’t resolve itself for two years. Could you keep going? Could you push forward and still try to build something amazing? Well, that’s what my special guest did. His story is so inspiring and I’m delighted to introduce you to him right now.

Hi, I’m Colin Knox, CEO and co-founder of Gradient MSP.

And it’s great to have you back on the podcast, Colin. I think you were here in 2021. I say I think, that seems like so long ago, the podcast is in its sixth year now, and we’ve decided to go for at least 10 years. We’ll have to book you now to come back in like 2028 or 2029.

Sounds good.

So thank you for joining us again. You have joined us today to talk about something really important, which kind of affects every MSP at different stages of their business growth, and that is dealing with when things go bad. It’s the issue of resilience and we’re talking more today about mindset and how you get through problems and how you get through stuff that just seems too big to tackle. And you’ve got an amazing story to tell, which happily you are the other side of that story now, which is a great time to tell us. So before we get into that story and we talk about what the problem was and the lessons you’ve learned, just give us a sort of a brief overview of who is Colin Knox?

Yeah, Colin Knox. I often refer to myself as the accidental entrepreneur. I worked at an MSP, one or a few for a number of years, and came to a place where I started to get frustrated with things. I never really had thought of or wanted to be a business owner but finally just said, nevermind, I’ll step out and try it for myself. So I stumbled into entrepreneurship worked through all of the lessons learned some of the very hard way, some an easier way of what it takes to build a business, grow a business, exit a business, and maybe sometimes foolishly start a new business and go through it all again. So yeah, accidental entrepreneur, maybe with a bit of founder amnesia, some people call it, but hopelessly devoted to building great businesses and impacting others.

I love it. That’s a great title. In fact, that could be the title of your book when inevitably you write a book. I think all of us have a book inside us. Tell us briefly what Gradient MSP does before we talk about what you were trying to achieve and the problem that you ran into.

So we’re all about making the back office operations of an MSP easier. The core way that we do that today is helping them make sure that they get paid for all the services that they deliver. We partially automate, but really simplify and make easier the process of reconciling all of their vendor usage across all of their end customers into their PSA for billing every month. So that’s the initial core challenge that we sought to solve, and we’ve got a few other little auxiliary add-ons that we do, but that’s the core facet, is make sure that MSPs are getting paid for everything that they’re delivering.

Yeah, no, that’s a great mission. And what inspired you to start this in the first place?

We had an exit of the last company, did really well with that. I tried my hand at retirement, albeit for a very short period, but got way too bored and started just having conversations with MSPs again. I mean I’ve been in the space now for, I think it’s my 21st year, so knowing a lot of MSPs over the years. I started having conversations with them and after we caught up, it started it with one real question, which is, What is one thing that you wish you never had to do again as an MSP owner?

And time and time again, they kept coming back and saying, doing my billing every month and figuring that stuff out. And so we looked around, nothing existed that we could find on the internet at the time to solve it. We started digging in on why this might not have been solved or why MSPs were so complacent on it. And for us, it came down to a lack of integration between all of the vendors and the PSAs. I mean, it no longer was this Autotask and ConnectWise own the entire market, they still do really well and have good market shares, but there were so many other PSAs involved. Integrations were lacking between vendors and all the PSAs.

And then the business owners, I mean most of this industry is 10 people and under as a business, and they just weren’t in a place where they were ready to get rid of doing that. It’s such a sensitive thing. So we say, what the heck? Let’s give this a try and hoping and thinking ignorantly and maybe arrogantly that this would be an easy problem to solve and the business would just explode and boom did not go that way. It has been a lot of trial and error, a lot of working through things, a lot of patience and diligence and determination. But yeah, we’ve finally landed at a place where we’re effectively solving it for a lot of MSPs out there and continuing to learn more every single day as to the nuance and lack of standardisation in how MSPs bill their customers.

Yeah, I can imagine. I’ve never started any kind of that business. So I’ve started two main businesses and I’ve had a couple of other little side hustles over the years, but I ran a marketing agency, where you know what you’re doing, right? You’re finding clients that have got problems, you solve those problems. And now with the MSP Marketing Edge, it’s a version of the same thing. So we work with MSPs whose problem is, Where do I get clients? And we help them to generate leads and win clients. So I’ve never, and it’s never occurred to me to be of interest to me to start a business like yours where here’s a big problem that is such a big problem that no one else has even tried to tackle it. Or maybe they’ve looked at tackling it and thought, nah, but we are going to go in and tackle it.

And we know we can anticipate what a lot of the problems are, but I imagine when you go into something like that, and essentially it’s a software driven solution, I imagine as you’re going into that you are a conscious incompetent in that you don’t know what problems you’re going to come across along the way. So you could guess at the problems, we could all see that integrations will be an issue and lack of APIs, and I guess a few years back, PSAs were less open than they are now. But then you don’t know who’s going to enter the market. You don’t know who’s going to buy who. PSAs kind of came out of nowhere, what 10 years ago, so what’s the next tool that’s going to come out of nowhere that it would have to integrate with this? What’s the next billing thing? Microsoft brought in NCE a few years ago, what’s the next Microsoft stupid thing that’s going to mess all of that up?

So even going into it knowing you were a conscious incompetent, you clearly thought there was going to be, what, would it be riches at the end that you were driving? Because I think everyone looks eventually for an exit, was it that or you looking at, hey, we could actually build something here that helps people and we make money at the same time?

So when we did this, started this business, I’d say riches wasn’t anything in the sights for us. We had a very notable exit before. We did not need to work. We did not need to do anything if we never wanted to do anything again. So for us, I think it was just wanting to have an impact, wanting to be busy on something and wanting to build something that was fun to work on, something that could have an impact and would allow us to make some money. I wouldn’t say that we came in this ever looking for an exit. And as a proof point of that, I can’t share the name of the company, but we founded the company in October of 2020, and that was the start of it. We announced the brand or launched the brand in December of 2020. We actually launched our first product, which was just a sample to see if we can get attention in the market. Can we get time and effort from MSPs? We launched that in June and our great fortune and luck and timing and whatever else, we got a few hundred MSPs within about three months. We got about 300 MSPs using that i