Evergreen Services Group President Brad Wittwer explains MSP (managed services provider) acquisition and investment strategy. The latest deal: acquiring NetGain Technologies.Evergreen Services Group, an MSP investment firm, has acquired roughly a dozen IT services providers so far in 2018. The company, backed by Alpine Investors, is building a national network of MSPs that maintain their own identities — but scale within specific regions or vertical markets through additional tuck-in acquisitions. Details about the latest investment, involving NetGain Technologies, surfaced today.
In addition to investing in MSPs, Evergreen has been building out its own management team. Among the key recruits: President and COO Brad Wittwer, who joined the company in June after a successful run at various investment ventures and technology upstarts.
So what’s Wittwer’s focus — and how does he see Evergreen evolving in the weeks and months ahead? He shares some answers in this ChannelE2E interview.
ChannelE2E: First, the nuts and bolts: What attracted you to Evergreen Services Group?
Wittwer: It was a compelling combination of factors. First, the team; I found the individuals at Evergreen humble, bright, selfless, and to have this magnetic enthusiasm. Second, Evergreen embodies empowerment, where folks get expansive scope and get to own it. We’re adamantly against wasteful bureaucracy and instead each individual has an ownership mindset which yields passion and emotional investment. I literally outlined my ideal role to Jeff and Ramsey and that has come to be. Lastly, I was sold on the strength of the investment thesis, especially with a focus on the long-term. All of my intuition around making the jump to Evergreen has been reaffirmed time and again.
ChannelE2E: You oversee operations for IT service providers in Evergreen’s portfolio. What exactly does that mean?
Wittwer: I’m responsible for Evergreen’s organic growth, cultivating world-class talent, and ensuring Evergreen is the best home for MSPs and their leaders. Instead of integration, we value the independence of each our operating companies. Hence, I collaborate with company leadership on both strategy and tactics, and ensure they have necessary resources. I’m a resource for them if they want a sounding board for challenges or help defining direction or identifying blind spots. Our belief is to value individuals, focus on selecting the right leaders, and then empowering them. In other words, I focus on finding the next great leader, giving him or her the right tools and guidance, and getting as much company under them as possible. I’m also building out Evergreen’s operating infrastructure, and I’m a partner to Jeff and Ramsey on Evergreen’s direction and success overall.
ChannelE2E: Ramsey Sayhoun remains head of M&A, and Jeff Totten remains CEO of the overall business. How are you interacting with them in terms of the day-to-day management of Evergreen?Wittwer: Ramsey takes the lead on investment cultivation; Jeff takes the lead on the investment thesis and vision for Evergreen; I lead the our collective businesses post-close.While we each “own” our respective domains, they’re phenomenal thought partners. It’s not uncommon for me to brainstorm ops questions with Ramsey and get his advice, or for Ramsey to seek my perspective on an investment. We’re quite defined around responsibility hand-offs, but we put our heads together on the key decisions for Evergreen.
ChannelE2E: Your background includes key posts at Xenon Ventures and Scaleworks. Any particular experiences at those companies that prepped you for the Evergreen journey?
Wittwer: I’m beyond grateful for the mentorship and experience I received at both Xenon and Scaleworks. At Xenon, we built an acquisition model and fund from scratch, and then I had the reins as CEO of two software businesses. Teri Wilson and Jonathan Siegel really showed me the ropes of how to move fast while staying scrappy. At Scaleworks, I dove into the acquisition side with greater intensity which now gives me an appreciation for what Jeff and Ramsey do. The partners at Scaleworks, Ed Byrne and Lew Moorman, taught me a great deal. Both Xenon and Scaleworks had an exceedingly hands-on operational model, and I benefited from experiencing their playbook and observing the strengths and weaknesses of their CEOs as well.
ChannelE2E: You recently completed a road show with your portfolio companies. What was the goal of the road show and how did it turn out? (mention go-forward strategy as a bigger family, taking strengths from each and sharing, M&A, and cementing long-term goals and vision, etc. – anything you care to cover is great.)
Wittwer: I visited Executech in Salt Lake City, Interlaced in San Diego, Wolf Consulting and Jenlor in Pittsburgh, and Integritek in Austin. I thoroughly enjoyed it. The purpose was really to listen, form relationships with our coveted leaders, and see how we can best support them. I focused on hearing about strengths, challenges, and opportunities. While there were obvious commonalities between the teams, they each certainly had their own distinct personalities. I have no doubt the leaders are going to learn from each other, and I’m keen to facilitate the sharing of strengths amongst them. The road show culminated with all the leadership teams meeting under one roof in Denver. We brought together some of the best minds and seasoned operators in the MSP world. The partnership potential was apparent to everyone. As we covered the go-forward strategy as a bigger family, the dialogue helped inform our Evergreen vision.
ChannelE2E: Are the portfolio companies implementing any business standards to ensure consistency across the companies? (Mention the GAAP reporting, etc., if you can, etc).
Wittwer: Our mentality is to protect the autonomy of each business so they can remain agile and loyal to their geographies, and it’s deflating to not set your own course. That said, a default toolbox is emerging. The few standards for us that are necessary are GAAP financials and a set of stipulated metrics in the future.
ChannelE2E: You’re several three months into the position now. Is the role – and the industry – what you expected, or have there been some surprising wrinkles along the way?
Wittwer: I felt in SaaS, while the products might be different, there were uncanny commonalities amongst the businesses we would acquire. The leaders seemed to always invest in product a ton and barely in sales and marketing, and their offerings would consistently be underpriced. That made the playbook quite simple. But I’ve been surprised at the wide range of business models across MSPs along with the variety of philosophies, culture, and strengths/weaknesses. On a more personal note, our approach at Evergreen is more about giving our leaders and operators a goal and support, and then getting out of the way. So I’ve shifted from a prescriptive leadership style to more of a supportive and advisory one. That still entails quite a bit of hustle as I try to ensure our leaders have whatever infrastructure they need from our side.