Managed services News
For New-Look Ensono, Heavy Cloud Investment And Key MSP Acquisitions Highlight Fast Rebound
Two years ago, infrastructure management partner Ensono was shrinking.
The Downers Grove, Ill.-based solution provider – then known as Axciom IT – had been spun off from its parent company and purchased by Charlesbank Capital Partners and M/C Partners in July 2015. Sales, current CEO Jeff VonDeylen said, were "a little less than $200 million," and the company's mainframe management business accounted for about 50 percent of overall revenue.
Within a month of the sale, Axciom overhauled its leadership team by hiring a new CEO (VonDeylen), COO (Brian Klingbeil), CTO (Tim Beerman) and EVP of Sales and Marketing (Marc Capri) – all of whom came from Town and Country, Mo.-based Savvis. Then, in January 2016, the company re-branded itself as Ensono to signify an increased strategic emphasis on cloud capabilities, as well as marketing and sales.
The year-and-a-half since has seen Ensono follow through on that promise.
"We've been able to grow the revenue stream, but we've been able to grow at a faster rate," VonDeylen said. "We really like that mix of services revenue (mainframe, private and public cloud). We think of some larger enterprises that still have legacy mainframe environment. We're kind of uniquely positioned to offer all three capabilities, unlike many of our competitors. And, frankly, that's helping us win."
According to VonDeylen, Ensono will be a $275 million company in 2017. The solution provider has added more than 300 employees since the spin-off, growing the overall workforce to 1,000, and its client list has grown from 40 to about 130 on the backs of two major acquisitions.
Perhaps most importantly, Ensono improved client distribution; less than 40 percent of its revenue comes from the company's top two clients, whereas before that number was closer to 60 percent.
"And the clients we're adding are significant enterprise organizations that have significant IT spend and opportunity," VonDeylen said.
Last September, Ensono expanded its geographic footprint by purchasing $59 million U.K.-based MSP Attenda, which allowed its new parent company to bolster its managed AWS services, and launch a private cloud offering (Ensono Cloud) using Attenda's platform.
"They had a great platform and capabilities outside the U.S.," VonDeylen said of Attenda. "We were primarily a U.S.-based company. Their cloud platform was a bit more developed than ours. We were developing that."
Then, on June 29, Ensono closed on a deal to buy Inframon, another U.K. solution provider that specializes in Microsoft products and managed Azure services. Inframon earned Microsoft Cloud Productivity Partner of the Year honors in 2017.
The move was made in response to Ensono's existing enterprise clients calling for the solution provider to add Azure capabilities; many of those companies have strong Microsoft relationships and feel more comfortable with its cloud platform.
"We've seen a lot clients that have said, 'We're a Microsoft shop. Microsoft has made it very advantageous for us to use that product. And that's where we're going to go,'" VonDeylen said. "On the other hand, they need help – how to take advantage of it and how to use it.
"Three or four large U.S.-based companies have told me, 'If you have Azure capability, great. We want you to help us migrate applications and get our cloud journey where we need to be. If you don't, we're going to use someone else, and that likely means certain applications and workloads are going to be moved off Ensono environments.'"
At that point, Ensono's managed public cloud business – which had been AWS-centric – was experiencing greater demand increase than other offerings, but represented the smallest portion of company revenue. The Inframon acquisition made sense on this front, VonDeylen noted, because it gave Ensono a complete cloud offering in relatively little time.
"We knew building [Azure capabilities] would be an 18-month process between getting capabilities and getting customers," he said. "It tends to take a little longer than you think. We had this opportunity with Inframon. The founders are two ex-Microsoft employees. That's really how they built their business, supporting clients who bought Microsoft products. It was really a great fit for us in terms of being able to complete that portfolio and now offer on the hyperscale and public cloud basis both AWS and Azure managed cloud."
Inframon – referred to as "Inframon, an Ensono company" for now – will be integrated into Ensono's existing public cloud business in the coming months. Eventually, VonDeylen expects the Microsoft solution provider to be absorbed by the Ensono brand.
Sean Roberts and Gordon McKenna, who founded the British cloud transformation company, will join Ensono in leadership roles. McKenna, in particular, expects to spend much of his time establishing Inframon's U.S. presence and building relationships with Ensono clients.
"It's really about building out those capabilities," VonDeylen said. "Our goal is, over the course of the rest of this year, how do we add 10 or 15 resources in the U.S. who can be that tip of the spear with the clients, as well as some of the back end operational and technical support? We'll be aggressively adding those resources in the U.S. We've got our base of clients raising their hand and yelling pretty loudly that they need this capability."
Looking ahead, Ensono sees its two recent MSP acquisitions as a "great growth vector" because of the extent that app development has moved to the cloud. Adding public cloud capabilities, combined with Ensono's existing mainframe and private cloud services, give the company the sort of hybrid offering VonDeylen believes it needs to remain competitive.
"If we didn't invest in our AWS or Azure capabilities, we were going to lose applications," he said. "That may happen over five to 10 years in some cases, or for smaller companies that may happen a lot faster. We just didn't want to be in that position where we weren't relevant to our clients' growth objectives."