Dave Sobel is host of the podcast "The Business of Tech" and co-host of the podcast "Killing IT." In addition, he wrote Virtualization: Defined. Sobel is regarded as a leading expert in the delivery of technology services, with broad experience in both technology and business.
This week, Sobel spoke with Todd Thibodeaux, who is CompTIA's president and CEO, about the MSP industry's current lobbying efforts, potential regulation and championing diversity and equal opportunity when it comes to hiring decisions.
Transcript follows below.
Dave Sobel: One of the things that I've been following a lot is what's going on in the managed services space around regulation. And what's interesting is you just made a big announcement last week, and I want to get a little bit of understanding of what your thinking is in the change of direction around lobbying because this has been a pillar of your strategy for a few years and you've made a change. So, what's the thinking behind that?
Todd Thibodeaux: Yeah, I think a few years ago we changed the way we organized our annual goals to have a category called 'relevance.' And one of the ways that we felt we could increase our relevance across the industry at large was to take a bigger position in the public policy space, particularly at the state and at the federal level. So, we acquired the TechAmerica group, which was teetering on the brink of bankruptcy at that time, virtually insolvent. And we brought them in and with them came the state activities.
They added some of the federal activities that were in addition to what we did and what we hope we would be able to employ with something that we were calling "grassroots to global," so that we would have the full range of a spectrum of companies that we'd be representing from the smallest people, including individuals who are out there trying to get jobs in the industry all the way up through the traditional MSPs that we think about, which are the bread and butter. There's 150,000 of them out there working today, providing the support, and then all the way up to larger companies. We would do trade, compliance and regulation work. We would lobby on privacy issues, lobby on things. Also try to build some national initiatives toward a national standard on data breach.
So, there we had a very ambitious agenda that we wanted to pursue as part of that. And through the process of that, we developed basically the preeminent state program that was out there. But a lot of that work tended to center around a small set of issues that were primarily for the benefit of a small number of very large companies.
And one of those issues was right to repair. And as that right to repair issue kind of came along, we began to recognize more and more that we were on the wrong side of that issue, that it was probably a position that we were taking on behalf of the companies there. It was contrary to what we want to be our core, which is openness and opportunity, entrepreneurship, allowing companies to come along and fulfill the needs of the customers.
So, as that began to kind of rub us a little bit more the wrong way, I think it led to a lot of soul searching and then as the pandemic happened and as the global fight for justice kind of taking shape and thinking about the position that we had and the role that we could play, it just didn't make sense to continue to put resources toward doing that kind of work on behalf of those companies that honestly don't probably need our help in the long run. These are trillion-dollar companies or near trillion-dollar companies that we're working on behalf of. And there's no reason why they can't go out and work with [companies]. The thing was, there's lots of other tech groups they can work with.
We weren't the only ones. But we're the only ones in the position that we have in the workforce space. Think about the CompTIA certification kind of platform and pipeline. It's probably one of the most preeminent colorblind pathways to a career that exists anywhere in the world. We're global. So, we wanted to put the emphasis behind that and the reaction that we've gotten has been very positive.
Sobel: And I would expect this in terms of the change, particularly. I mean, I've had conversations about rights to repair on my show. I don't mind saying that I had come out saying I thought you were on the wrong side of it. And so, I was encouraged to see the change now. Before we move on from lobbying, I want to ask kind of a bit of a follow up here, because I've been spending a lot of time thinking about all of the security issues and the ransoms that are being paid. One of my more recent interviews was discussing around insurance and how the insurance companies are starting to review this space. I think this is moving government into slower action, particularly on our space, and that I think regulations are coming in a more substantial way. I think you've got a different perspective and I'd like to hear your take on kind of what your thinking is on what's happening in that space. Particularly as that thing come around, you've withdrawn from lobbying. What's your take on that space?
Thibodeaux: Right. I want to emphasize too, we're going to maintain an outsource capacity, not necessarily with a formal internal staff, but we're going to work with a company called the Signal Group in D.C. that we've worked with for a long time. The head of that group, Charles Cooper, has been a good friend of our organization for years, and we're going to utilize Charles. We're going to be talking with him actually next week to set up the pace and cadence of how they're going to be monitoring some of the things that you've been talking about and describing to make sure that we're able to address those as we need to. I think the thing was, let's lower the cost structure of having an ongoing large staff of people doing this work and monitor the activity and then be able to rally resources on those issues as we need them.
We've been following this issue around licensure and certification of companies for many years. And although there's been some discussions in some state legislatures, most of the time they've never made it past conferences. They've never made it past one house of a bicameral legislature passing that. They've certainly not gotten to the government's desk. The Californians who are the leaders in almost all tech policy in the country have not pursued these kinds of things. Although they led on privacy, that was an issue where they're kind of setting a standard for the U.S. economy. But if these things do come along and they do become a threat, we'll absolutely be there to address them or on behalf of the group of companies that are going to be impacted the most. And that's these small MSPs; people who are standardizing their practice in cybersecurity, people who are doing all kinds of different work there.
So, we want to make sure that everybody understands we are going to be there for that constituency as we need, but we're just going to monitor it and see what happens. Now, there's a chance that what you're saying could absolutely happen. But our experience has been over the last few years that everybody gets in these hops around these things, there'll be a particular issue happen. Look what happened in Atlanta. What a terrible situation that they had to go through. Or the hospital in California that they ended up doing all their work on patent paper before they finally gave in and paid. So the ransomware creates a lot of motivation for it, but a lot of times it peters out.
We just think that over the course of the next couple of years in what we've been monitoring up to this point, that we don't see a lot of high-risk things happening probably over the next two years. Maybe after that, but states are so strapped for money right now. They're so strapped for priorities related to the pandemic and their workforce and all kinds of different things that we don't think this will be a priority for them.
Now, if it does and it comes back up, we'll absolutely be there to contend. I mean, the licensure issues that you see in other industries like maybe it's plumbing or electrical that are union driven a lot of times, those are meant to be exclusionary practices where you're setting the bar so high that it requires someone to have to climb that new border wall to get over it to get into the industry. So, we don't want to see something like that because it stunts entrepreneurship and it stunts the kinds of companies then.
But if it comes to that point, we'll get together a group of our members, we'll take their guidance and we'll see what we need to do. Luckily in the Louisiana case, it's only related to government contracting. It's not related to peer-to-peer, for-profit company to for-profit company work. When you start to see it creep into that, that's when I think everybody should really pay attention because most of the laws that have been enacted and lots of several other states have done this, they've almost always been related to government contracting.
Sobel: It's interesting you bring up the electrical and plumbing angle because the discussions that I've been thinking about are the idea of CPAs, doctors, lawyers, which is a different kind of certification. And it will be interesting to see which of those two models plays out. And you could be right … it's a matter of how long this may take to get there.
Thibodeaux: Right. So, I think the CPA, doctor, lawyer is interesting. Those are professional society-driven things. And again, these were thought they were meant to be exclusionary so that you created this high bar and the continuing education requirements for those groups to maintain your credential is pretty substantial. The number of hours that you have to deploy to put those things, continuing to put them into practice. I'm not sure how practical that would be and what kind of an audit structure you would potentially need for that. So, we had the trust mark for years and when we initially imagined it, it ended up being so difficult for people to get because they were so far from meeting what we considered to be the highest bar possible.
And we had auditors at the time and people had to submit documentation. There was a lot of work. So, we ended up having to take it down a few pegs, and then that was still challenging to people. And then we took it down a few pegs and eventually it became a best practice roadmap for the industry, which will then ... but everybody who did it said they benefited from doing it. We talked about this prior, was it was challenging for us to get vendors to kind of say, 'Okay, we'll give preference to you if you take these steps to become a better actor or become a company that's following these best practices.' Look how long this framework has been out and how few companies have really fully adopted it and embraced it. So, this idea that you can put out this best-practice standard.
But I think if someone really steps to the forefront and says, 'Yeah, I'm going to give preference to companies that adhere to these best practices.' And maybe it'll be self-validating at the beginning, and maybe it eventually evolves into something where you could have this audit process or some kind of continuing education kind of model. We'd love to see that happen. I think we're going to continue to try to work toward something like that. We're trying to do it now with our education programs that we have out there. The channel account manager program that we have is the most popular, but it'd be great if there was something where people could follow these best practice roadmaps. The insurance company is really interesting angle because they've been a part of this process a long time. They can do more to drive the adoption of best practice standards than anybody else.
Sobel: I would agree completely with that. And I think, well, I'll pin this and say probably we've set up some good conversations for your managed services community. So I'm going to use that then to ask you a little bit of a question like, let's take a quick step back and talk to me about how you view the constituencies that CompTIA serves. It seems like because you've got a massive portion of the certification business as well as individual professionals who get certified, you've got your community pieces and the vendors, how do you view those with membership in CompTIA?
Thibodeaux: Yeah, I think that's morphed and changed a bit over time. So, the industry is really interesting compared to some others. We have a really steep top of our pyramid. It's really narrow and sharp. But then at the bottom, we have this really wide fat base where we have these ... There are very few industries where there's 150,000 companies providing similar services out there to other small businesses. But when you get past that, it doesn't take very long before it narrows off into companies that are way less than a billion that are in the very top part of the pyramid. So, you think about Oracle, Microsoft, Apple, Cisco, you name it, HPs, the variations of those, at the top of the pyramid. But it doesn't take long before you start getting into second-tier players. And then beyond that, it probably doesn't number more than 400 companies. Then you have this 150,000 at the bottom of the base.
But I think that the group that we're trying to serve, whether it's large, medium or small is companies that are looking to the future. And whether you're a really small company, but you want to embrace the future opportunities that relate to some of the new technologies that we laid out, that Nancy Hammervik and I talked about at our ChannelCon speech that we talked to these 14 key technologies that relate to IoT or relate to cloud or security of future potential energy, renewable energy sources that are going to take a lot of IT to make those things work, the smart cities. You name it, the whole list is there of companies that want to be engaged in those.
But it's still also the companies that are providing the bread-and-butter services to other companies, providing application platforms, still doing break/fix, doing provisioning of equipment and software, doing all these different things. As long as they're looking to be progressive in their thinking because we don't necessarily want to do and develop programs for companies that are interested in just kind of the status quo. There's lots of other resources for those companies today. And a lot of those resources that those kinds of companies need are basically running your business kind of things. Sales, training, accounting. So, there's lots of places you can get that.
So, we want to provide resources where we can be the unique source of those, and that's what the communities help to drive in terms of defining what those initiatives should be. How long can we continue to have the conversation about what the next-gen solution provider looks like? How we can get them over that hump. But you're right. So, we have that constituency that we want to see move forward. It doesn't mean they're going to adopt all these technologies. I mean, the industry is great to bring on the next great thing. But how many of them have really panned out into the next great thing. Remember back when electronic medical records were going to be this massive panacea. Everybody's going to make a fortune doing EMR transitions for doctors. Very little of that happened. Then we had mobility, and mobility never developed really until the sustainable and profitable business practice.
Sobel: Not separately. Certainly, yeah.
Thibodeaux: It really wasn't until cyber had been there all along, but then it became more of a specific service that people could provide as things moved into the cloud. And now with remote work, that might turn into a practice. But it's good that we keep churning these new things, but I'm not surprised, and I don't blame the companies for being a deer in the headlights and saying, 'Well, which of these should I do?' Because they want to place big bets. Plus, they're busy running their business. So, we want to be that resource for those companies.
But I think the idea that we're going to focus on large company policy issues, that's off the table. We're not going to really play in that space anymore because of this workforce constituency as well. We're delivering 300,000 plus exams a year. We have more than 3 million certified alumni around the world now. We're getting ready to launch an accredited educational academy, hopefully sometime next year, that will allow us to accept 529 Pell Grant and GI Bill money directly. We're winning contracts in states or job retraining programs.
A big goal for me would be, can we play a huge role in getting 50,000 people employed in the industry each year? So, can we work to that? And then can we, at the same time, do everything we can to help elevate any company that wants to get to a new height and a new place. We just want to be the resource for those. But focusing on the bread-and-butter company in the channel, doing what we can to support the vendors and how can we support them, helping those companies come along. Because everybody's looking for that company who can take the next step, who can increase their volume of purchases by 10, 20% a year on a five-year run. And it's hard to identify those companies. But what can we do to provide the resources?
Sobel: Okay. So, you said you're doubling down on diversity, inclusion and equal opportunity efforts. What does that mean?
Thibodeaux: Yeah, I think we have to figure out a little bit what that means. We know that our IT-Ready program that we have, which some of your listeners probably know about, but this is a charitable program. It's in a lot of different cities across the country already. But what we do is we take people and we have to sift through about 800 people to find 25 people who will join a cohort who'll then go through an eight-week program, at the end of which they're virtually guaranteed a job. So, they come into the program. Some of these people that come in have never even turned on a computer. But eight weeks later, they're capably doing tech support for major companies. So, we're doing something right in that process. It costs us about $5,000 a student to do those and we've had a few thousand students come through the program.
But doubling down would mean taking that to 300% more cities. Having it be even more broadly adopted to get state funding for those kinds of continuous programs, to get municipal funding for those kinds of programs in addition to the private funding, in addition to the funding that we're hopefully going to be able to provide through the profits from the academy that we do. So that would be one area. Another area would be that we focus those programs on people who don't have all the advantages. To find people who are ... because a lot of the people that come out of these programs, not ours but others, the employers think these are broken people.
This person was out of work for six or nine. What happened to them? Well, I don't want to hire that person. But if they come through a qualified system and they get a chance to meet these people, they hire them. So, how can we have ... so yeah, we look for 800 people to find 25 people. But in a few cities, we actually ran out of people because in a couple cities, we had to put in a remediation program to get people's reading and math levels up to a 10th grade level so they could actually do well in the program. So, I think part of it is also developing a better feeder mechanism for IT-Ready or other programs like our academy that we do so that we can take people who aren't even quite ready to go into IT-Ready and get them there.
I think it's also working on soft skills development because a lot of these, the minorities that we work with in some of these communities, they just haven't had a broad range of interaction in a lot of different situations. So the soft skills training that they receive through our program is invaluable because every employer almost to a person will tell you they'd rather take someone who has really strong soft skills and then train the technical than take someone who has good technical skills and then hope they can train the soft skills. It's really hard.
Sobel: You said, and I love hearing about my listener is your constituency, right? The typical small-business solution provider. Let's tie that. And I often ask on the podcast, why do we care? Why should a typical solution provider care about this investment?
Thibodeaux: Because it provides a pipeline of talent for them. A lot of small companies, they're the ones that are willing to hire people who are less than perfect because a lot of times, small companies actually have a more nurturing environment to bring people in. When you come into a small company, you get thrown to the lions a lot of time and you're asked to do a lot of things immediately, which gives you this broad range of experience that you can use there or take on to another place. But I think the idea that we're doing good for the industry, that the tech industry and small companies in particular would be leaders in this space, because a lot of that 50,000 that I talked about, we'd love if all 50,000 of those got employed by our members.
If we found talent for them and help that talent pipeline because to a person, every company says, 'Well, I can't find skilled talent.' But the thing is, they're not even really looking for it in a way. They're not looking beyond, well, we posted ads on Indeed or Monster or these job boards and like, well, is that all you did? Did you talk to your local community college? Did you place ads in places where the typical employee might not see them? They're not looking around creatively. So, we want to be able to do that and relieve some of that challenge of finding new staff or the folks. And it's also a good use of, like we just think of the resources that we have to help the industry become more diverse, because study after study after study shows that when your company is more diverse, you are more successful and you have better profit rates and you have better rates of innovation and you have better customer service and experience and support.
So, whatever we can do to help companies make that transition to become more diverse. And I've made this argument time and again when I've done TV or radio interviews, that we can't judge the diversity of the industry based on Silicon Valley alone because their history is not very good. Look at the history of the small company in our industry, in our niche in particular. It's very good. And people have good experience, but can it be better, and can we present them more quality candidates? Absolutely.
Sobel: I said earlier when we were prepping that you get actually much more animated about this issue than things like talking about the lobbying. Todd, what's exciting you most about what you're working on?
Thibodeaux: I mean, it's really the fact that I just got word today that we had maybe our best August ever in the height of this, that we're doing ... I mean, one of the comments that someone posted on Facebook over the weekend was, 'Oh, CompTIA's funding must be drying up and that's why they're stopping their lobbying activities.' And I said, 'Well, okay, to be up 2% year-to-date in the worst economy of virtually the last hundred years on $90 million from last year, if that's drying up, I'll take it every day.' So, I think the idea that we can kind of come back to our core, that we can have this really tight focus. Our communities are doing great through this and we've had such high levels of engagement. Our member retention is 10 points higher through all of this than it's been prior to that. And that's a testament to Nancy and her team for the work that they've done.
The participation rates in our online meetings and forums has been great. I mean, the number of people that participated in ChannelCon online was fantastic. We had people that stayed through all the days, saw all the sessions. I think we had a bunch of really good content for that. The good thing is we've been doing virtual events for years. So, this wasn't a tough transition. We produced the entire event for about $25,000.
But that only happens because of the volunteers, people who are willing to come to the forefront and do that. So I'm hoping that we can kind of balance this need to help the company that wants to advance and be better, that we can help them move along while we can kind of spearhead the thinking and thought leadership about how some of these new technologies can turn into real meaningful, profitable products and services for our members. We can pay attention to their needs in the state and federal space by keeping a watchful eye out for danger signs. And then at the same time, we can help individuals who want opportunity to come into the industry to do that. And we want to do that globally too.
But I think those are the things that really get us jazzed and the staff really is very engaged around those issues. We're taking Charles Eaton, who's the head of the foundation. So, he's going to be the person who's going to gather all those stakeholders and figure out a one-year plan for how we want to get out. It's interesting when we go and speak on things like STEM and education reform, we're saying different things than almost everybody else is saying. We're saying that the over focus on math and STEM is a mistake because it disenfranchises so many kids who are told that if you're not good at math, you're never going to be any good and that you're not going to be able to get a good career, unless you're really good at math, which is not true.
The idea that you need a four-year degree to get these jobs, the idea that you can't transition to a new career without having to go back and get another four-year degree or go take a bunch of courses. So, we have a long list of generalized talking points. And I think one of the first emphasis points that we want to make is just to get out there and make that message. There was a story I just read yesterday in Inc. Magazine lauding Google for doing these career certificates. This new program they've launched, something that we're now for 20 years. We need to get out there and be the person that they're writing those stories about. Now, we work with Inc. and they use a lot of stringers. So, it's, there's not like a big pool of Inc. writers. But I think we just need to be more in the face of the press and the media around what it is we're actually doing.
Sobel: So, if we wanted to make this super concrete to end this for those members of the community, those typical small business solution providers, if they want to get involved with getting into the skills program or hiring those people, how do they get involved?
Thibodeaux: Yeah, I think we don't have all the answers for that right now, but I think as it relates to IT-Ready. So, if anybody out there wants to learn more about that, just have them reach out to me at email@example.com and I'll direct them to the individuals and they can find out when we have people graduating from the classes. One of the things that's real challenging though for a lot of the people that come through the programs is, I mean, they're taking eight weeks off from any compensation because typically this is a full day program and unless they're working nights, they're giving up some money and they don't get a stipend through the program. They're going to get a job.
But I think one of the things we'd like to do long term is have some relocation scholarships or some people that would allow them to tap into a fund that would allow some of our graduates to move to places where there's a job, because this is a huge part of the unemployment issues that we've had in this country. In particular, when housing values go down, when rents go up, it makes it really hard for people to move. And if you're in an area where there aren't any jobs, even if you train, you need to move. You have to go someplace where there's a job. So, we want to do, I think, some creative things with that.
One of the things that I didn't mention that might come out of this, we might be developing an angel fund for small company entrepreneurial startups in our space on our core membership. So, we're exploring that. Our board had a bunch of great ideas. We welcome any suggestions about programs that we can put in place that will kind of drive more entrepreneurial opportunity for companies who want to start businesses in tech, because right now there's a lot of businesses that are going to go under in the hospitality space. A lot of restaurants are going to go down. A lot of these ... it's just sad.
But when things improve, those companies ... I'm doing a presentation later today for Channel Partners talking about six things people can do to kind of help themselves survive this pandemic and the uncertainty in the future. And one of these big issues is around how you market your company successfully during this when you can't do a lot of face-to-face meetings. Is your Zoom game really good or do you want to improve that? So, I'll talk some about that. But I think there's a bunch of exciting things. But right now, the only really throughput that we have comes from the IT-Ready. But if people want to know, firstname.lastname@example.org and I'll make sure to plug them in to the right people. But we'll be announcing things probably in the next couple of months as we kind of define how we're going to move forward with this.
Sobel: Right. Well, thank you for taking the time to talk to me about this, clarify some of these issues and give people an opportunity to get involved in this.
Thibodeaux: We welcome involvement. Anybody who wants to get involved, join the community, follow the communities. We have so many people who participate on the communities and councils themselves. Then we have this next ring of people who follow what they do really closely. Then we have another group of people who kind of just occasionally do that. But we've reached I think a milestone in that we had more than a million touch points of people with our content, with our programs, with our webinars, with all the things that we're doing, and that doesn't even include all the touch points that happen in the certification space. So, our content is being utilized and viewed by a lot of folks. But if you want to play a leadership role, we absolutely welcome your participation in the communities and councils.
Sobel: I think everybody listening had several things that they could do as homework to get involved. Todd, thank you for your time and looking forward to talking more.
About the author
Dave Sobel is host of the podcast "The Business of Tech," co-host of the podcast "Killing IT" and author of the book Virtualization: Defined. Sobel is regarded as a leading expert in the delivery of technology services, with broad experience in both technology and business. He owned and operated an IT solution provider and MSP for more than a decade, and has worked for vendors such as Level Platforms, GFI, LOGICnow and SolarWinds, leading community, event, marketing and product strategies, as well as M&A activities. Sobel has received multiple industry recognitions, including CRN Channel Chief, CRN UK A-List, Channel Futures Circle of Excellence winner, Channel Pro's 20/20 Visionaries and MSPmentor 250.