Many MSPs made progress in 2022, and there is "still a huge appetite for managed services" globally in 2023, according to the Evolving Landscape of the MSP Business 2023 report from Barracuda Networks.
Key takeaways from Barracuda's report include:
- MSPs are projecting growth in 2023. On average, MSP revenues are expected to increase from an average of $12 million per service provider in 2022 to over $16 million in 2023.
- The evolving cyber threat landscape continues to challenge MSPs. 37% of MSPs cited the evolving cyber threat landscape as a challenge in 2023, down from 38% in 2022.
- Cybersecurity is a priority for MSPs. 35% of MSPs are looking to add a security operations center (SOC); 34% want to offer managed detection and response (MDR), and 32% want to provide eXtended detection and response (XDR).
- MSPs want to diversify. In addition to incorporating cybersecurity services into their portfolios, many MSPs want to support organizations across a variety of industries, as 46% said they intend to offer managed services to customers in myriad sectors.
Many MSPs are planning to grow their revenue and expand their portfolios, Barracuda noted in its report. However, this growth presents challenges, and MSPs must plan accordingly.
How MSPs Can Combat Growth Challenges in 2023
In its report, Barracuda indicated that MSPs should consider or plan ahead for growth challenges across the following areas:
- Revenue growth by identifying which services they want to integrate into their portfolios and ensure they are well equipped to deliver services that align with their customers' expectations.
- Sustainability by getting sustainability credentials and looking for ways to make sustainability a part of their day-to-day operations.
- Employee stress by tracking the health and wellbeing of their workers and ensuring these individuals get the help they need to feel and perform their best day after day.
Although many MSPs are doing well to address various growth challenges, they should not "relax," Barracuda stated in its report. If MSPs prepare for growth challenges, they can address such issues before they hamper their ability to grow their businesses.
June 1 Marks Barracuda Global MSP Day
Barracuda released its report as part of Global MSP Day, on June 1, which the company created in 2018 to highlight, challenge and celebrate the managed services industry.
Meanwhile, Barracuda's MSP partners can access virtual and live events in North America and Europe on Global MSP Day.
Neal Bradbury, senior vice president and general manager of Barracuda MSP, commented on Global MSP Day and what it means for his company's MSP partners:
"The past 12 months have seen the continued rise of the MSP. And MSP Day 2023 gives us the perfect opportunity to acknowledge the hard work the MSP community is doing. Here at Barracuda, we applaud the difference MSPs continue to make to businesses worldwide and MSP Day was designed to reflect this."