Products & Resources

The MSP Owner's Handbook: QBR Edition
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The MSP Owner's Handbook: SaaSSy Edition

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Hey everyone, welcome to this episode of Harvest. I've been really looking forward to this one. It's going to be a fun one. I'm here with Juan Fernandez of Super Ops fame. And the reason I'm so happy to be talking to Juan is he's got a wealth of experience for us to tap into, more than we can do in this episode. Not least building his MSP, it's a $20 million turnover revenue in only six years. We're authoring multiple books, the MSP Owners Handbook. We've got a QBR edition and a SASE edition.

He's doing wonderful things over at Super Ops and he won Shark Tank. Juan Fernandez, how are you doing?

Juan Fernandez - SuperOps (00:35)
I'm fabulous, man. And it's such an honor to be here today, James. And thanks for having me. I've been looking forward to this for a while. We've been talking about it. And to be honest, we got started talking earlier. I actually, probably, like you said, we probably should have hit record, man. We're already into this thing. And I'm already having a great time. So it's such an honor to be here.

James Steel (00:54)
Lovely, thanks

Juan. Listen, let's dive straight into it. This is all about actionable tactical advice for MSPs and you've got a wealth of knowledge to draw upon. So I'm gonna do that in a moment, but before we get started, there's a tradition on this show and that is to ask you, what do people get wrong about you when they first meet you?

Juan Fernandez - SuperOps (01:11)
Yeah, they think I can speak Spanish. So many people think that and it's kind of a funny story that I think I spend more time in my life if I added up all the minutes that I've ever spent explaining why I'm Hispanic with a Hispanic name coming from an Hispanic culture and don't speak Spanish.

James Steel (01:28)
That's brilliant. we're on this topic of misconceptions, what is it that MSPs get wrong about that journey to profitable growth? What is it they do that isn't quite right in your mind?

Juan Fernandez - SuperOps (01:40)
I think we walk in with an expectation that it's easy. you know, we sell ourselves this dream of everybody needs IT. That's the first fallacy,

So I, for instance, you made a mention of how I went from zero to 20 million in six years. That's the second iteration of something. The first one, went zero to two to three million and it took me four years. Right. And at that, it wasn't the best success. Like I learned a lot of lessons on that. I matter of fact, I landed up burning it to the ground originally.

When I built my second one, I built in the preface of building for profit. I started at the very moment that the very, very, very, very, very first scratch of that piece of that pen on that bar table napkin was how do I make money at this? And then I backed into what I was going to do.

Everything was surrounded around how to actually get to profitability at every moment So that when the quarter went in the dollar came out, so that's one of the misconceptions I think that we have and again It's not a thing that we do bad It's just a lesson that we have to learn

James Steel (02:45)
So tell

me then, you're writing on this napkin then you're saying, right, I'm setting myself up for profit first. There'll be a lot of MSPs listening to this that may be around the sort of 1 million, 2 million turnover mark. What should they be doing? What tactical points should they be looking at do you think to be sort of focused on that profit first? Where did you start out on that? What did that napkin look like?

Juan Fernandez - SuperOps (03:07)
You know, the whole thing was every year and I used to work on this often was creating a business plan and revisiting that thing and realizing where am I making, what am I, who am I and what am I doing? And screwing yourself up to understand those things is really what it was all about. I wanted to create dream jobs. I wanted to be profitable. I wanted my employees to be happy. I wanted to deliver services customers wanted to buy. Like I focused on the things that

Wanted to do and the things that I wanted to happen and then I built into that so paying attention to my you average customer profitability Understanding the amount of tickets that you know an end user should have or a customer should have What amount should I have like I didn't look at what the industry says I should be looking at I looked at what I wanted to happen and then I made my own KP I's So and I say this to a lot of MSPs. They asked me one all the time like

What should I be focusing on? And I'm like, what do you want to happen? And they're like, this. And I'm like, OK, so focus on that. Well, what's the number that I should be focused on? I'm like, da, da, da, da, da, da. Why do you want to be like everybody else? If I give you a number, you're asking me to be like everybody else. Why do you want to be like everybody else?

You're asking the wrong question.

James Steel (04:23)
There's some consistencies though,

right? There must be some commonalities. mean, generally most companies are gonna say, okay, I want to reach, I want to have sustainable growth, happy workforce, good work-life balance. So like, let's start off with a sustainable growth. Like where would you focus? What would your metric be there? If I said to you, right, okay, I'm at 2 million. I really wanna have a nice progressive path to five. Where would you be looking specifically, would you say?

Juan Fernandez - SuperOps (04:36)
Here's the thing.

I would say that 90 % of what we were trying to do was understand our time to revenue and our time to profitability in every account. With that being said, any time we were onboarding a customer, we onboarded a customer that we knew where our revenue was coming from. So I knew exactly how many people I was going to need to be hiring based on that. So when I scaled my locations zero to 16, I had 16 locations, we physically built across the entire United States.

And everyone says, well, you were probably in these major metros. No, I started in a city with 7,000 people. People, not businesses, people in the corner of nowhere, Durango, Colorado. Like, trust me, there's snow and less people, right? And so, God, there's like, no, well, I mean, the ones that were there had been there ages. It took me forever to get them out of there. So all of that was difficult.

James Steel (05:31)
less MSPs presumably competition.

Juan Fernandez - SuperOps (05:43)
And so understanding that I needed to get to $20,000 in reoccurring revenue before I hired an employee was one of my metrics. So anytime I came into a city, I knew exactly that I need to get to $20,000 in reoccurring revenue before I would hire somebody. So I would stay there until I got to that number. And I knew that would take me less than 30 days to do.

James Steel (06:02)
I'm fascinated.

let's say we popped up a new location. Tell me, do you start with that then? So you take on it. who's there to begin with? And what kind of services are you doing? employee-wise, so obviously you service it remotely first. You just.

Juan Fernandez - SuperOps (06:11)
Nobody.

Yeah,

I just walk into a city and just be like, all right, here's where we're going to start offering services. Yep. And go get customers.

James Steel (06:27)
And then as you bring on more customers, who are you putting in place in terms of sort of boots on the ground then? How does that look?

Juan Fernandez - SuperOps (06:32)
Yeah, so like

you get to about 15,000 in reoccurring revenue, right? So that's between three to four customers-ish, depending on your pack. I knew exactly I needed four. And with that, then I actually would hire the person in and have them come into those customers, start supporting them, and then help teach them how to go get new ones and watch them and teach them, show them, grow them. And then they saw it worked.

Right. And so then they're like, OK, cool. And I'm like, hey, you got this right around the second. We'd be around 30 getting ready to go to a 40,000 a month in reoccurring revenue around 35. I'm like, hey, you need a number two now. So I would hire a number two with them. And at 40,000, they were a team. And then I'd back up and let them run. So my biggest branch was $4 million. And I had four people.

James Steel (07:24)
I'm interested to know, thing is you've literally written a book on the topic when it comes down to regular conversations with your customers and being able to frame those outcome conversations. What do you think is a good way for MSPs to handle those communications and kind of tier them maybe based on the of the potential of the clients?

Juan Fernandez - SuperOps (07:40)
It was the.

you know, a constant relationship. was a ongoing relationship.

This is why I wrote the QBR edition first. 90 % of businesses that are out there.

in the SMB space are just like you. They don't know how to grow and scale their business. That's the fallacy that I thought everybody that had a business knew what they were doing. No, they don't. Ironically, and it was the first time that I was bringing systematical processes to an industry and all my customers that never had seen anything like this before. And they were like, can I get some of that? I'm like,

But I sell this and they're like, yeah, I know, I want some of that.

James Steel (08:22)
Can you tell me how that looked? you obviously did, as you say, you did way more than just the tech. And so those processes and things, how are you packaging that? Because you must have had some sort of standardization. You couldn't have scaled to the level you did without some sort of standardization there in terms of what you could offer.

Juan Fernandez - SuperOps (08:35)
Yeah.

Yeah, that's what we call everything as a service, right? We have, had a whole mantra around providing products, quality products and services that everyone could afford and adding so much value they could afford not to.

James Steel (08:47)
Yes.

Juan Fernandez - SuperOps (08:48)
So I say this, there's three different lenses in managed services. There's being in practice, right? There's having a practice, and then there's best practice. And so I have been in the industry for a long time and certified in a number of different things, always trying to understand the best practice around technology service delivery and understanding the problem and paying attention to the problem and looking for ways to solve the problem. so...

A lot of what we sold to the customer was the removal problems. And it came in all aspects, right? Like I worked with HP to create HP DAS. I was HP innovator of the year because I created something new where I took their product and made it do something they didn't know it did and made it a whole market product. And they decided to take it to market after they sold it.

James Steel (09:36)
The concern there though

is that if the MSPs listen to this they'll be like, brilliant, so the key to this is I need to play with more tech.

Juan Fernandez - SuperOps (09:43)
So I was very refined in my partnerships. So I had a handful of partners and that stayed that way for the majority of my entire time because when I think about the due diligence, I'm trying to answer the question because many of you have heard, why don't you buy and sell me this? I used to use this when I worked somewhere else. And it's like, don't know. Like you don't really have an answer to that.

I did. I told them, I was like, speaking of which, here's why we made the decision because we interviewed 25 vendors and this is exactly the solution to these problems that we're trying to solve. And I know they use that in that industry, but that was actually a point tool that was actually for an IT company. And this is for a managed services company. And here are the nuances in which we deliver this technology and here's the effective ways and here's the outcomes and here's the price points. Here's all the ABCDFGG, but they asked the question and I was able to answer it.

That built trust. And I said, Here's the margin that I'm marking this up to make. And I'm being honest about this with you because this is how I make money.

James Steel (10:41)
a how does your time as a somebody who's running the MSP? How does your day look? Because it sounds to me like you're spending all your time understanding the tech to the most degree you possibly could and the processes to the most degree you could like we were you like just head in notes and like what's it like?

Juan Fernandez - SuperOps (10:59)
No,

I mean, I actually actively A B tested everything, right? So like I'll build a process. And again, I think that I talk about this all the time, that that whole people process technology thing is wrong. That's a bullshit. It's actually in the wrong order. It's actually as a leader, I build processes that enable people.

that deliver a technology that equals profitability, which equals great cultures and great companies.

so we used to call ourselves in my sales team. We didn't even call them sales reps. We call them solution nears because all I taught them to do was how to solve problems and talk and think that way and to never pitch. So I say it all the time.

I'm not selling anything. I'm guaranteeing success. I'm not selling, you can't buy anything from me, but you can experience success with me, right? Like that's a completely different approach to the way anybody feels. they're like, damn, that's bold. And I'm like, and as a matter of fact, when we get down to the end of this in our 12 month, you'll record a video with me telling how technology moves you forward. And if I don't get that, then I failed.

And they're like, what? I'm like, dude, I'll refund your money for the whole year. That's how confident I am in what we're doing. And I would put our ass on the line all the time. had film crews that would go out there and record video testimonies, get those customers talking about it. mean, we had, yeah, we did it. There's no bullshit around. I'm not saying I didn't do it. Dude, go look. Like the videos are all still, they're all still out there. Like these customers would just tell, I mean, dude, we had drug rehabilitation centers where they would talk about how we changed.

James Steel (12:23)
You actually did it. You actually made it happen at the end of the 12 months. Very good.

Juan Fernandez - SuperOps (12:39)
people's lives with technology, like how we implemented technology and like people that were drug addicted and like they were talking about how the programs that were there and the technology, like how it saved their lives from death. Like it was crazy. The stuff we heard. So this is the impact that I think we don't know we have is the outcomes that we're delivering to those customers. And that's where, if you don't understand what you do and what you're actually doing, you seem like you're just selling product and you're just

fixing a problem and that's not what we do.

James Steel (13:12)
This is where getting

streamlined is really important, isn't it? Because otherwise you can't do it for everything. You almost need to niche.

Juan Fernandez - SuperOps (13:16)
Yeah,

I have to be very, very focused on what I deliver and I need to know that I deliver that thing every single time. Like without a doubt, right? Like I have to guarantee that it's going to happen. And if my program and process doesn't do that, then I'm full of shit and that's a bad place to be in a reputation.

James Steel (13:34)
Why is it so important to have such a streamlined portfolio?

Juan Fernandez - SuperOps (13:38)
It's focused man. Like here's the thing, it's a death of a thousand cuts in a house, in a house of mirrors, right? Like I don't know where I'm going to get it from today. Like, and that's a dangerous place to be. That's chaotic. It's scary. It's uncertain. It creates friction in your ecosystem. Like your team hates it. Just so you know, like I do this all the time with MSPs and I'm like, Hey, let's go through this. Let's drop this quarter in. And it's funny cause I say, okay, you got a new customer grow. And I'm like, I asked the business owner and they're like, they tell me what happens.

I'm like, cool, all right, drew that out. Go sit down, go over here, sit in the corner. Now team, new customer comes in, go, what happens? Tony jumps over the couch, Chris takes five days off, Mary leaves the building and like gets sick immediately. I'm like, whoa, why? And they're like, have you ever seen our stack? There's no, like we don't, like we hope it works every time.

James Steel (14:31)
That's really interesting. I haven't heard many people talk about that, honestly. That idea of, okay, put a coin in and then exactly what happens. What's a good way for someone sitting and listening to this thinking, I wonder if my process is a bit like that. What would be a good practical way to start looking at that?

Juan Fernandez - SuperOps (14:41)
Yeah, I have a whole team.

it's funny because I used to do it to sales teams all the time. Any new salesperson, I'd be like, all right, come in. What's the top three sales questions you're going to ask the customer? Do you know about AI? Do you know about cybersecurity? And do you have a backup plan? And I'm like, interesting. Those all don't work. Those are horrible questions. And they're like, why? I'm like, where did you get them? And they're like,

James Steel (15:05)
You

Juan Fernandez - SuperOps (15:08)
Well, I looked them up like chat GPT. You see, like those are the top three things that like most of businesses like would like really resonate with. And I'm like.

Yeah, we don't do any of that. So why would you ask that question? And they're like, we don't do that. I'm like, no, we don't do anything with that. that? I said we have things that do that, but we don't do that. That's something we do, but that's not what we do. And cybersecurity, yeah, we don't know anything about that. We're just best practiced by design. So we don't offer that.

And then on the other end of the stick, yeah, backups. That's not something we really do either. It's just native. It's part of it. It's not what we do. It's part of what we do. And so it was very interesting. so rather than just pop up for salesperson, we did a lot of deal autopsies. And what we would do is we understood the questions that we asked that led back to what we do so that we could talk about the process in which we deliver it. And that is essential to selling.

because if I'm asking you random questions, I'm just going down it just to fill space. So we were very deliberate in what we asked. And I said, watch, ask these five questions and watch what happens. And they're like, okay. And then they'd come back and they'd be like, I'm like, what happened? Well, they said yes. And I'm like, and? Then you told them about our process, right? Yeah. And then you got a signed deal, right? And they're like, you know, it was actually really easy. And I was like, so like that whole making IT simple was my job.

was to make the service delivery, the sale and the delivery and the win simple.

James Steel (16:40)
We have a section on our chat called industry manure. And this is basically stuff that you hear in the industry that you know just isn't right. That really grinds your gears that pops up all the time. Can you think of anything?

Juan Fernandez - SuperOps (16:54)
You know, the whole point of why I came back to give away my models for free is exactly why, because I heard a lot of stuff that wasn't right.

James Steel (17:05)
Go on, what's top of

your list? What's the worst one?

Juan Fernandez - SuperOps (17:08)
Like everyone needs to have, like they need to be run towards cybersecurity. Like the other one that really kills me is follow frameworks. Like that particular one is why I did what I did to come back and give away my models and taught the whole time I was building it.

is because I was building for something completely different in a completely different way. And I was building toward profitability instead of toward frameworks that waste time.

I see a lot of people say, know, this is really good for us and I'm sure it is but

You know, we laid that down on our highly operationalized component. was, that was a dumpster fire. And so.

James Steel (17:45)
Yeah,

I think that's probably a growth maturity thing, it? A business maturity thing. Perhaps it benefits some, but if you're at a stage where you are, where you're highly systemized and have the processes already, perhaps that's not an ideal one.

Juan Fernandez - SuperOps (17:55)
Yeah, we thought we

we wanted to try to see if it was, you know, relevant and like it just, it was, it was rough.

James Steel (18:01)
So Juan, it is time for our question from the last guest. Now, our last guest was Uri van der Sleis. So he's a sales expert from the Netherlands. And he was saying, look, let's say you're in a negotiation and you don't want to drop the price. What are ways to show value without saying that you provide great service or that you have this lot of value? What are strategies to keep your margin without saying stuff that everyone else says as well?

Juan Fernandez - SuperOps (18:28)
You know, I love this question and I get a lot and I used to love dealing with this at the deal table and I'll say, you know, one of the things early on in my conversation with a customer was honesty around where I make money and telling them that, you know, in our products and services and in a hardware, we have X percentage of markup and software X percent and inside of our service and support, we actually have a margin as well. And these are our margin numbers and I used to give them out.

That being said, when this would come up in the negotiation phase of the deal, people would say, Juan, I love this. I really want to do business with you, but man, this is way more expensive than I was hoping for. And I knew it was going to be more, but I didn't think it was going to be this much more. And I would say to them, I said, you know, I really appreciate that you recognize that there is this. I thank you for not, you know, just saying that you don't see the value in it. But here's the thing. There's a cost of doing business.

And there's a cost of doing good business. Now I would say that I could drop my price, but the challenge with me dropping my price would, I will ask you this question. This is the service and support that you want right now, right? You want this, you would love to have this. So you could see your business being successful with this, but if I drop my price, would you be okay with less service and support and basically putting you right back to where you are? And they're like,

Well, no, I said, well, that's what you're asking for. You actually want to go right back to where you were, not where you need to be. And they're like, well, no, I want that for this. And I'm like, well, that doesn't cost that though. Because if I do that, my cost of service and support, I can't give you this high level of service and support as a business because then I would be out of business. And if I'm out of business, you can't have that. So there's a cost of me delivering this to you.

That question was one of my favorites and I will always love that question because that's where you true up who you are and whether or not you know what you're doing in business. That is the ultimate checkmate moment to know whether or not you have defined your products and services and know how to do business. Everybody pushes that button and it's your choice whether or not you will be able to answer that I know what it takes to run a good effective business or drop your price.

And that tells me that you don't know how to run a good business. So that's not a shot, but it definitely tells me that you're probably going to be struggling with that customer down the road. And you're probably struggling with your employees when they ask for a raise. And you're probably struggling when you have a higher overhead because you're not thinking through how you're making money in your business. You're thinking through how that money is going to come in the door. That's the wrong way to approach that. So that's my thought.

James Steel (21:16)
So listen, Juan,

it's time for you to pass the pitchfork, which basically means I need a question from you, if you don't mind, for our next, could be MSP, could be an industry expert, what question would you like to ask them that's gonna really put them on the spot?

Juan Fernandez - SuperOps (21:23)
A question?

Hmm. This one, this is very near and dear to my heart. And this is a question I ask everybody is, and I have a whole thing coming. This is like my whole new talk track for 2025. MSP five. Oh.

James Steel (21:44)
5.0

Juan Fernandez - SuperOps (21:45)
5.0, day one.

What do we do now?

James Steel (21:49)
and we'll just leave it there. I mean, that's such a broad question. Do you want to clarify any further or are we just going to leave it there?

Juan Fernandez - SuperOps (21:56)
I'm gonna leave it there, I'm gonna leave it for the next person because I'm curious about what everybody says we do when this day comes. And it's not that far away.

James Steel (21:58)
great, you've really teed that up nicely haven't you?

When is 5.0? Five years?

Juan Fernandez - SuperOps (22:10)
I don't think it's five years, but I think that's another question you're to ask the next person.

James Steel (22:15)
Yes, I will do.

Finally to close, thank you so much for spending some time with me. Honestly, it's been great. Can you give us a yell from the barn? So this is your shameless plug. What are you up to at the moment? Where would you like to direct anyone's eyeballs and ears?

Juan Fernandez - SuperOps (22:28)
Yeah, absolutely.

You know, I came to solve the problem that I saw. Again, I talk a lot about solving problems. And one of the ones that I couldn't leave the industry without solving was the death of a thousand cuts in managed services. And that's where I'm at now here with super ops is trying to solve the, you know, know, existential question about how do we run to profitability? How do we become more efficient? And how do we use artificial intelligence to actually drive us forward? And so

You want to find out more, come ping me on LinkedIn. can find me there on LinkedIn, Juan Fernandez. Type in Juan Fernandez MSP and you'll find me. Also, come over to SuperOps, superops.com. Take a look at all the things that we're doing over there. Lots of new innovations around a fully unified platform for the MSP of today and tomorrow.

James Steel (23:14)
Juan, I feel like I could have had a five hour interview with you potentially. There was so many areas that we could have dived into, but thank you. You've given us loads of gold. Hopefully we'll see you again.

Juan Fernandez - SuperOps (23:22)
Absolutely look forward to it James. Thanks for having me cheers to your success and also appreciate all the folks over at sales builder for having me Thanks you guys

James Steel (23:31)
Thank you. Likewise, all the best. Take care.

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