MSP MindShift Begins Organic Expansion In Chicago4:12 PM EST Thu. Jul. 26, 2012
MindShift Technologies is opening a new Chicago location as part of the Waltham, Mass.-based MSP's growth strategy to become a national service provider under its parent Best Buy.
Just last month, mindShift acquired White Glove Technologies to expand into Texas.
The MSP has been looking to expand into Chicago but couldn't find the right acquisition target to get there as quickly as it wanted, so it chose the organic route, Chisholm said.
"When we were acquired by Best Buy, they promised we could continue expanstion and they've lived up to that with White Glove and now organic growth," Chisholm said. "From a remote capability, we serve customers throughtout the world, but in terms of physical locations, you'll see us go after most [major markets]."
Chisholm said mindShift expects to expand into Phoenix in the early fall and Atlanta and Los Angeles before the end of the year, all organically.
In Chicago, mindShift has completed its initial phase of staffing with additional expansion planned over the next several months, according to the company.
The company had a legacy customer base in Chicago that previously was served remotely. With a local presence, the company expects to attract more customers from the nation's third-largest city, Chisholm said.
"We have a lot of push, demand from customers, in that market. It's a key market. Chicago is relatively close geographically [to a previous Minneapolis acquisition]. We decided to build our own core team. We hired new people. We're getting new space. We'll hit the street in a week or so talking to customers," Chisholm said.
The company has signed its first Chicago-area deal that includes a local presence for managing 322 desktops, according to the company.
The MSP can afford to build expansion in addition to buying into markets thanks to increased capital and potential customer demand from Best Buy, which acquired MindShift last November.
"This is our first organic market. The reason being Best Buy gives us better lead generation capability through their relationships with Best Buy For Business. They have demand from their customers, who are saying 'Can you give us a higher level of service than in the past?'" Chisholm said.
Chisholm added that even as mindShift expands organically, it will still look at acquisition targets in those new markets. "Each market is unique. We can open it ourselves and fill in. In Chicago, there's a fair amount of business in the suburbs and we can find an acquisition to extend our reach relatively quickly. We have a team looking across country for other [potential acquisitions]," he said.
NEXT: Hire Vs. Buyer?
Meanwhile, mindShift said customer demand for managed and cloud-based IT makes it easier to both find new customers and new employees to serve those customers. The old model of being easier and cheaper to buy than to build no longer holds true in a managed services-based world, Chisholm said.
"From a customer perspective, they're moving from premise-based to cloud-based IT services. A lot of existing [VAR] suppliers can't get to the next level. They don’t have the capital to get there, nor do they have the technical expertise," Chisholm said. "As more technology is put together in an integrated fashion, the more complex it becomes. [Customers say] 'This guy was good for me, but they see a change in what they're looking for and there's too much disruption because their current provider [doesn't have the skills].
"On the employee side, there's consolidation on the IT [VAR] side and there's some people available. There's also a lot of people looking to grow with a more sophisticated company. A lot are frustrated where they are today. I never think hiring people is easy but we are taking the time to do it right. We have a lot of depth and expertise and we can supplement [local talent] with expertise from around the country."