The common rule of thumb in investing is that you should diversify your portfolio with the idea being that as some markets dip others surge and you’ll avoid unnecessary investment risks. Some IT solution providers are finding that this same rule does NOT apply to their businesses — especially when it comes to vertical markets. One MSP in particular who shares this conviction is David Pence, CEO of Acumen IT, an MSP that’s been in business since 1999. Presently, Acumen IT has 50 employees, it achieved 15% revenue growth last year, and it’s projecting 25% growth this year. According to Pence, making the decision to reduce the number of vertical markets his company served was a key factor in its current success.
A few years ago, Acumen IT’s customer base was a diverse mix of construction, healthcare, engineering, and retail clients. Within the past couple of years, however, Pence took at a hard look at his customer base (with the help of his ConnectWise PSA tool) and decided some big changes were in order. Specifically, Acumen IT is ramping up its healthcare and financial services focus and parting ways with the construction and retail markets. “It’s nearly impossible to be an expert in healthcare and construction — the needs within these markets are very different,” he says.
Since narrowing his company’s vertical market focus, Pence says it’s afforded his company the ability to develop its healthcare and financial services expertise. Within the next couple of months, he expects to have his team HIPAA and FINRA certified, an achievement he says will put Acumen IT in the vast minority of IT solution providers in his region. And, that, says Pence, is another reason he firmly believes other MSPs could benefit from the same vertical market reduction.