Is Verticalization the Right Strategy for MSP Growth?


Is Verticalization the Right Strategy for MSP Growth?

Zix | AppRiver


Terry Ledger’s first customer was a “really strange one.”

They were a semiconductor brokerage house. Think of it as a stock market for computer parts. If Acme Corp has an excess of one hundred thousand chips and Wayne Enterprises is mothballing production because they need one hundred thousand parts, the brokerage plays matchmaker.

As the founder of Network Coverage, a managed service provider (MSP), it was Ledger’s job to keep the brokerage’s systems running. But he quickly learned that the semiconductor stock market was a world unto itself, packed with intricate processes and complex software.

Perhaps understandably, Ledger didn’t niche down into the world of semiconductors. Instead, he pursued customers in a wide range of industries, securing clients in manufacturing, engineering, biotechnology, among others. During this exploration, he realized he was attracting more and more customers in one vertical: commercial construction.

Year by year, he acquired more construction expertise and developed a stronger reputation among building companies. Eventually, Network Coverage was seen as the MSP for construction businesses in the Greater Boston area. He says this process of verticalization was key to the success of his company.

If you aren’t familiar with the term, verticalization refers to specializing in specific industries, functions, channels, or regions. In the case of MSPs, it almost always means industry verticalization—that’s specializing in banking, healthcare, life science, and so on.