666 Mastering Managed Services: Insights from Rex Frank

Hello friends, Uncle Marv here, getting close to the end of our time here at PAX 8 BEYOND. It is the second half of day two and we are now into the PAX 8 portion of the interviews. And sitting beside me is the Vice President of Academy, Rex Frank, is in the house. 

Rex, how are you? I'm having a good time. This is like my world, PAX 8 BEYOND. This has been very exciting, second time I came last year, and of course bigger this year than last year, so I'll start with that.

What are your impressions this year? Well, I'm really happy. Last year I was talking with Jen Bodell and she said, I really want BEYOND to be a different conference. I said, you want it to be different. Let's focus on education instead of vendors talking about stuff.

And they put their faith in me with PAX 8 Academy and our coaches to put the content together. And at the end of the session, Rob Ray said to me, Rex, you sold me, right? Like after the end of last year. And so they were able to carry that forward into this year.

Wow. So if Rob says that you know that you've hit the mark. Right. 

Tuesday night, late night, you hit the mark. Were there beers involved? Absolutely. Yes.

So with that, I mean, yes, the emphasis, I think one of the things that MSPs have said over the years, and I think vendors are starting to listen, is we want that education. We obviously like hearing from the vendors, but not just in a pitchy way. From the stage, we want to be able to sit in rooms, have conversations, and talk about real problems that we're having day to day.

You guys have actually done a really good job of that. And even from the stage, it's not really been preachy. So I appreciate that.

Yeah. The way we put it together is we've been coaching ever since the C-level operations days. We've been doing this operational coaching and finance coaching.

And this is how we do it. I personally, I was thinking about it the other day, 10 years of coaching, 2,000 hours a year. Well, I got 20,000 hours in the trenches with MSPs helping them solve their problems.

And that's the background. And that's just me. There's 22 coaches or something like that.

And they have applied that. I think I saw the other day, we crossed the 850 partners we've worked with line, where we actually work with them through working on the business, on getting their PSA configured, getting the life of the ticket figured out, working on their KPIs, working on what we call the service team HR with org chart, job descriptions, that kind of stuff. Working on, we call it leverage your tools.

So section 5 is leveraging your tools where we're working on your documentation systems, your patching systems, your RMS. Most people are only using 5, 10% of their RMS. Like really leverage these things. 

That's where we really grow our gross margins. Section 6 is getting your accounting systems in order. We're working on chart of accounts, that kind of stuff.

Section 7 is all the client facing systems. The way you do your business reviews, the way you structure your client touch plans, your account management plans, the way you do project management. Section 8, we call it get ready to grow.

Like if you're doing all those things and your MSP is running on all eight cylinders, we're going to need to hire more people. So it's hiring process, employee onboarding processes. It's how you set your strategic and tactical goals with your team members.

Section 9 is all about marketing. Now we've got this machine running, we're ready to grow with the people. We need to get the word out more of what we're doing.

And then section 10, it's all the stuff around the sales organization. We introduced the full result selling framework this year at PAX 8 Academy. Available in these free on-demand courses.

It's available in the peer groups. It's available in the instructor-led courses. It's available in the one-on-one coaching to help grow and mature their businesses.

And it's 800 companies working with 20 coaches developing and vetting content. That's really the background of what went into the session that we're running at Beyond. All right, so you answered a bunch of my questions right there because I was going to ask for you to go through what really PAX 8 Academy is.

Because people from the outside just assume it's videos online. And you can go and yeah, go check out the video series on this, this, and this. But you mentioned coaching, one-on-one coaching, instructor-led courses.

I mean, how much is involved in the Academy? So, I own C-Level Operations from 2010 to 2021 when we got acquired by PAX 8. And when we were C-Level, we really had a sign out front that said you have to be this tall to ride. You kind of already have to be at the level where you have a service manager. And a lot of it was explaining to the owner, you're welcome on the calls.

We want your insight. We want your wisdom and background and knowledge. But really, we need the owner to shut up.

We say we control the mute button because we're trying to pull the next generation of leader out of the individual. And as soon as the owner starts commanding the conversation, they go right back in their shell. So, we were really focused on the one-on-one coaching.

So, we show up at PAX 8 and Craig Donovan, my boss at the time, said that's awesome. Keep doing that and grow that, scale that, right? Bring it to more and more partners. But there's a problem, right? We need to meet every partner where they are, which is one of the four maturity levels that we kind of describe as the first maturity level.

Typically, everybody reports directly to the owner. You know, they're the only leader. And then the second one, the company has to figure out how to have an owner and a service manager.

And in that third maturity level, the leadership team develops. There's somebody from finance and maybe admin, somebody from sales. We got the owner involved.

We got maybe two or three leaders from sales at that point. Really, it's a leadership team runs the company. And there's a lot of operational change.

And in these days, you're going to add in a security manager. Somebody's going to oversee that. I totally agree.

Sorry, I left that out. And then the fourth maturity level is really these hyperscale’s. That's where we end up with a lot of multi-geography operational issues that are going on, right? So he says we got to meet every partner where they are.

And it's a challenge to have the same topic, triaging tickets. We do it completely different depending on what maturity level you're at. So he says we got to meet every partner where they are with what they want to learn.

So it's not only the grow and mature your business content that we brought from C-level, but it's also at the time there was 40 other vendors in the marketplace. Now there's 140 other vendors in the marketplace. And we need to educate about we kind of broke into two halves, the business development side, like the owners are looking at why would I use this project or product? How is it competitive in the marketplace? That kind of thing.

But there's also the technician side. If you've got seven products in your stack and you hire a new engineer, we need to educate them about how to use that vendor product to support your end clients. So with what they want to learn, we defined as the grow and mature your business, the vendor business development side, and the vendor technical side in the way they want to learn.

And this is where we kind of use that gym membership analogy. You go to the gym; you can just go use the machines. And it's kind of a free on-demand environment of using the machines.

And that's our free on-demand content at academy.pax8.com. We've been working really hard to plow the content into the Academy pages. And I think we have over 300 courses out there now. Or you can go to the spin class or the yoga class.

We have an instructor limited to 20 people, and you go every Tuesday at 10 o'clock for 60 or 90 minutes for four to eight weeks, depending on the course. And the idea there is you can have that interaction with the instructor. And that's our, again, instructor-led courses.

pax8.com slash academy. There's a whole list. I think we have about 26 different instructor-led courses.

You can buy them individually or you can get a monthly subscription. It's unlimited. For unlimited number of courses and unlimited number of people in the company, you can take the course.

Or you can do the personal trainer, right? So we still have all the one-on-one coaching available. And then the analogy I use is... Hang on a second. So the one-on-one is not reserved for C-level, like the owner.

Anybody in management in an organization can do that? We have not only the operations coaching, which is focused on that service executive. And then a service executive will pull in accounting or pull in sales when we're working on it. But we've got coaching targeted specifically at the sales manager.

We've got coaching targeted specifically at the finance side of the house, finance coaching. And there's an offering that we call value creation coaching. It's sort of our highest premium offering.

But it looks at the entire company. And we look at what your valuation is now, what the business valuation should look like in three years or five years, whatever you want. And we do a kind of a gap analysis.

And then we put a week-by-week plan in. Okay, you want your company that looks like this to look like this valuation. We need to work on this in sales, and we need to work on this in operations, and we need to work on this.

And there's a group coaching involvement. And we just continue to work kind of a three-year plan week-by-week. But we're literally working strategically and tactically with everybody in the company.

All right, so now let me ask the question that the biggest MSPs, they understand they have these levels. But for some organizations, and I don't know what the percentage is, but a lot of them come in as solo techs. They've just started, but they want to get in the ecosystem and prepare themselves for that growth.

They're doing everything. They're looking for the first hire. Is there a process for them to get into the academy before then, or do they still need to get to that maturity level? So you said, I said in the way they want to learn, right? So I talked about on-demand, instructor-led, one-on-one.

But there's also the peer groups, okay? And real quick on my fitness analogy with the peer groups is I got roped into doing this Kids Cancer Charity Climate Mount Rainier a couple of years ago. I'm not a mountaineer. That's all new to me.

But I raised like $7,000 for this charity. Okay, when you say mountaineer, like going into the mountains and doing actual hiking, climbing? What are we talking about? So Mount Rainier, it's just outside of Seattle. I know Mount Rainier, yeah.

It's a 14,400-foot volcano that's glacier. The whole top of it never melts. It's glacier.

And when you get up there, your ice axes, big spikes on your boots, the crampons, ropes, avalanche beacon you have to wear. Like it's a thing. But I had no idea what I'm doing.

But there was a lot of training, right? It's 9,000 feet of elevation gain while you're hiking. And I was not prepared. I wasn't physically prepared.

But the climbing group, the charity, we met every Saturday morning from early spring until the climb. And I'm talking get up at 4 a.m., drive an hour, hour and a half, and train on some mountain someplace. And what are the chances on Saturday morning at 4 a.m. if I'm going by myself, I'm actually getting up? Well, probably not much.

I'm not going to do it. But I know there's a group waiting for me. Right.

And then we help each other. Real quick, like halfway up on a training hike, we're going to be like, hey, guys, I'm not feeling it. I'll see you next week.

But my group's like, no, we're almost there. You got this. Right.

So to get back to your question, we looked at like coaching is too expensive for the solopreneurs, the word I like to use, where they're trying to figure out how to grow the business enough to get to their first employee. Right. So I laid out what I called a flight plan, like everything from filing for your business license to invoicing to get to a million dollars in services revenue.

Right. So and if you look at our peer groups, they're all named after airplanes. So we named Concorde.

Yep. Phantom, whatever. So we've got all these airplane groups.

And I'm like, this is the Phoenix peer group. So we have these Phoenix peer groups, and we call them flight plan groups. Some of the peer groups are the group decides what's most important, and they work on that together.

Right. But the Phoenix peer group is what I call a prescriptive peer group, where it's like we have a plan. We're all going to do this, and then we're going to do this, and we're all going to do that.

So we're all going to work on our business plans together. And everybody's going to present theirs and get critique and feedback, and then we all make them better while we're moving through the whole group's business plans. Then we're going to work on our contracts, and then we're going to work on our delivery offering, and then we're going to work on the next thing and the next thing and the next thing.

But we work on them together one by one. And everybody says, oh, I've already got a contract. So now the group's working on their contracts.

But we go over, this should be in there, and this should be in there, and this should be in there, and this is why, and they're like, crap. And they go back, and they work on their contracts. And we bring in experts to help with that.

All right. It's a lot of fun. That's the answer to the question.

And I just want to make sure that because there are solopreneurs that they're just starting out, but they know they want to get to a certain place. So there's a path for them to get there and a peer group to help and all of that. Yeah.

And one of the things we look at is when we get to the point where they have enough revenue, and we work on a plan, like how are you going to create the buffer to be able to make payroll if things get a little soft, right? So that's all part of it. And then we do this SWOT analysis on the owner's strength and weaknesses because it's a common question. Should I hire a tech, or should I hire finance, or should I hire admin? It's a different answer for everybody.

So we do a strength weaknesses assessment, and the recommendation is to hire to adjunct your weaknesses. So it's going to be a different decision for everybody. All right.

Well, there you have it, folks. We just got a, what was it, the quib course? That little compact book you used to steal in school. The Cliff Notes.

Cliff Notes version of Paxson Academy. And Rex, I thank you for taking time to come by. And man, we're getting close to the end.

It's almost party time. Yeehaw. So thank you, sir.

And we'll have a link in the show notes for Pax 8 Academy. And man, I'm sorry. I'm thinking about there's a party tonight.

There is a party tonight. And special guest. It's still a secret who that special guest is, but.

I know who it is. I do, but it's going to be a reveal. Well, by the time this airs, it won't matter.

I'm still not going to tell. You're not tricking me out of it. I know.

I'm still not going to tell. So that's it, folks. Thank you very much.

And thank you to Rex Frank. And this is coming to the end of Pax 8 Beyond. And I've got at least one or two more interviews here on Radio Row.

And we'll see you soon. Holla. .