The Six Partnerships an MSP Runs On

An MSP is a partnership business. It resells another company’s software, subcontracts part of its own labor, gets clients from other people’s referrals, sells through other people’s marketplaces, and, more each year, is owned by someone else’s fund. Almost none of that shows up in the industry’s own numbers. Kaseya, N-able, Datto and GTIA each publish a large annual survey of MSPs, and none of the editions I read asks what share of revenue, labor or new clients comes through a partner.

This guide is the map the surveys do not draw. There are six partnership types. For each one: what it is, what the MSP gets, what it costs, who is doing it, and what can go wrong. The last section is the checklist for the owner.

Partnership type	What the MSP gets	How the money moves	What the surveys measure
1. Vendor and distributor	Product to resell, program status, incentives	Margin on resale, rebates, deal registration	Services offered; not partner economics
2. MSP to MSP	Labor, coverage, specialty skills	Wholesale rates, hourly, per ticket, per endpoint	Nothing
3. Peer groups and associations	Benchmarks, coaching, other owners	Dues, event fees, vendor subsidies	Nothing
4. Referral and alliance	Introductions from firms the client already trusts	Referral fees, commissions, reciprocity	Nothing
5. Technology advisors and marketplaces	Deal flow and a place to transact	Residual commissions, marketplace fees	Nothing
6. Capital and brand	Money, a platform, a franchise system	Equity, rollover, royalties	Intent to sell only

1. Vendor and distributor partnerships

This is the partnership every MSP has and few manage. The vendor sets the terms, changes them on a calendar of its own, and grades the MSP on a scorecard the MSP did not write.

Microsoft is the clearest case because it publishes the rules. There are two ways to sell Microsoft cloud through the Cloud Solution Provider program. An indirect reseller buys through a distributor and needs only 1,000 dollars of CSP revenue in the trailing twelve months to keep its status, per Microsoft’s Partner Center documentation. A direct-bill partner buys from Microsoft, keeps the full margin, and, per the requirements page Microsoft dated October 7, 2025, needs at least one million dollars of trailing-twelve-month CSP revenue at the partner-account level, reassessed every year, plus at least one Solutions Partner designation. A designation, in turn, requires a Partner Capability Score of at least 70 out of 100 in one of six solution areas, computed from Partner Center data on revenue, certifications and customer adds.

Two of Microsoft’s own dates matter for anyone holding an MSP right now. Microsoft stopped accepting new applications to its Azure Expert MSP program on September 15, 2026, and ends renewals in January 2027; a badge that took an audit to earn is being retired. And from October 1, 2026, Microsoft applies a 5 percent cost-of-capital uplift to CSP software subscriptions billed monthly on annual terms (SQL Server, Windows Server, client access licenses, System Center), while starting a growth-margin incentive on Microsoft 365 the same day. The program rewards net new seats and taxes the legacy book.

The distributors sit between the vendor and the MSP and have become large. Pax8 says more than 47,000 IT partners and 800,000 small businesses buy through it. TD Synnex reported more than 150,000 customers and about 2,500 vendors in its fiscal 2025 results. A distributor relationship is the cheapest way to carry a hundred vendors, and it is also one contract that carries a hundred vendors.

Security vendors now run the most aggressive MSP programs. CrowdStrike’s chief executive said on the company’s March 2026 earnings call that its MSSP business went from under 100 million dollars to more than 1.3 billion in just over three years, naming Kroll, Pax8 and NinjaOne. Arctic Wolf relaunched its MSP program in June 2025 around volume pricing and deal minimums, with more than 2,200 partners of all kinds. Sophos offers MSPs monthly aggregate billing under its Connect Flex option next to the usual one- to three-year terms. The pattern is that the vendors moved to the MSP’s billing rhythm, monthly and per endpoint, because that is where the growth is.

The economics of resale are thin and the industry’s own benchmark says so. In Service Leadership’s index for the fourth quarter of 2024, published February 2025, MSPs averaged 11.1 percent adjusted profit and value-added resellers averaged 5.7 percent, even as the VARs grew hardware sales 22.4 percent. Project gross margin across the index fell from 23 percent to 12.9 percent in a year. Resale keeps the client and keeps the vendor. The profit lives in the managed services line.

Rung on the Microsoft ladder	What it takes	What it gives	Source
CSP indirect reseller	$1,000 of CSP revenue in the trailing 12 months	Cloud SKUs through a distributor; the distributor keeps part of the margin	Microsoft Partner Center, 2026
CSP direct-bill partner	$1 million trailing-12-month CSP revenue at the partner account level, one Solutions Partner designation, annual reassessment	Direct billing and full margin	Microsoft, page dated Oct 7, 2025
Solutions Partner designation (six areas)	Partner Capability Score of 70 or more out of 100	Co-sell eligibility, badge, incentive eligibility	Microsoft Partner Center, 2026
Azure Expert MSP	An audit at every renewal	Retired: no new applications after Sep 15, 2026, renewals end Jan 2027	Microsoft Partner Center, 2026
FY27 CSP economics	Legacy software subscriptions billed monthly on annual terms	5 percent cost-of-capital uplift from Oct 1, 2026; growth margin on Microsoft 365	Microsoft announcements, Aug 2026

What can go wrong has already happened at scale. VMware had about 28,000 partners when Broadcom bought it in November 2023, per ChannelE2E. Broadcom replaced the partner program in early 2024, and by notice dated January 26, 2026 it closed the VMware Cloud Service Provider program outright; The Register reported on January 31, 2026 that in the United States only 19 providers reportedly remained out of thousands, with open deals to be closed by March 31. Microsoft’s own 2022 move to the New Commerce Experience removed the one-month commitment and priced monthly billing 20 percent above annual terms, leaving partners on the hook for the term. A vendor partnership is a license that the vendor can rewrite.

2. MSP-to-MSP partnerships

The second type is the one owners talk about least and use most: buying labor and coverage from another provider and selling it under your own name.

ChannelPro’s November 2025 guide to structuring an agreement with another MSP lists the working patterns in the industry’s own words: geographic coverage for a client’s remote offices, specialty services such as compliance, cybersecurity or voice, overflow support when the help desk is stretched, and co-managed arrangements with larger clients. The billing question it poses is hourly, per ticket, or a monthly fee. That is the whole market, and no survey measures it.

The security operations center is the best-documented row, and I wrote a separate guide to it (Rent the SOC, Build It, or Buy It). The short version from that post: Barracuda’s 2024 survey of 700 MSPs found 43 percent outsource the SOC function to a third party, and Sophos’s 2024 survey of 350 found 81 percent offer managed detection and response, two thirds of them through someone else. The same logic runs the help desk after hours, the network operations center, and project labor. Field Nation, a marketplace for dispatching independent technicians, claims more than 20,000 of them in the United States; its predecessor OnForce launched in 2003, was bought by Adecco in 2014 and folded into WorkMarket, which is now part of ADP. The labor side of this partnership type has been consolidating for twenty years.

The most instructive case is The 20. It began as a membership group: member MSPs got a white-labeled 24/7 help desk, marketing and lead generation from a shared platform, and by 2024 the group counted 150 small and mid-size MSPs nationwide, according to a client profile published by its bank, First National 1870. Then the founder started buying the members. The company’s November 4, 2025 release announcing its 44th acquisition notes that all three firms “had participated in The 20 MSP Group prior to acquisition,” which let integration run in 60 to 90 days. By June 2026 the count was 48. A partnership that supplies your help desk also learns your ticket volume, your client list and your margins. The 20 turned that knowledge into a pipeline.

MSP-to-MSP pattern	What the MSP gets	Typical billing	Named example
Third-party SOC or MDR	24/7 detection and response without the payroll	Per endpoint per month	43% of MSPs outsource the SOC (Barracuda 2024, n=700)
Overflow and after-hours help desk	Coverage at night and at peak	Per ticket or per endpoint	The 20 MSP Group, white-labeled 24/7 help desk to 150 members (2024)
Field and project labor	Technicians in cities where you have none	Per visit or per hour	Field Nation, 20,000+ independent technicians (company claim)
Geographic coverage	A peer MSP serving a client’s remote office	Hourly or a monthly fee	Pattern named by ChannelPro, Nov 2025; no public deals
Specialty subcontract	Compliance, voice or security skills you do not carry	Project or monthly fee	Pattern named by ChannelPro, Nov 2025
Co-managed with the client’s IT team	A seat beside the client’s internal team	Monthly fee for tools and escalation	Covered in an earlier post on co-managed IT

The owner’s question for this type is simple: how much of the labor the client pays you for is delivered by people you do not employ, and what does the client’s contract say about it.

3. Peer groups and associations

A peer group is a partnership among owners. It is also, increasingly, a product owned by a software vendor.

HTG Peer Groups served more than 600 members from 500 companies when ConnectWise bought it in January 2018; it is now IT Nation Evolve. Kaseya’s IT Glue bought TruMethods in May 2021, stating that nearly 20 percent of the Channel Futures 501 ran on the TruMethods framework. Kaseya bought Technology Marketing Toolkit in July 2025, and on June 9, 2026 it launched MSP Success, a bundle of marketing services and peer groups sold to MSPs. The advice an owner buys about running the business and the software the business runs on now come from the same two companies.

Prices are mostly private, with a few exceptions. Kaseya’s TruPeer EMERGE tier, launched June 2024 for MSPs with one to five employees, costs 999 dollars to join; TechTarget reported that standard peer-group fees run in the thousands per year and that Kaseya covers a third of the fee for new TruPeer members, which tells you what the group is for. The Tech Tribe publishes its rates: 59 dollars a month for its Essentials tier and 79 for Growth. MSPAlliance, founded in 2000, is free and claims more than 30,000 members. Pax8 runs 15 peer groups of its own and says more than 130 MSPs have gone through them.

The performance claims are the vendors’ own. IT Nation Evolve advertises a 24 percent improvement in profit for members, TruPeer advertises higher seat prices, and Pax8 says members double their cloud revenue through Pax8. None of the three publishes a comparison group or a method. Treat the claims as marketing and the groups as what they are: a place where an owner sees other owners’ numbers.

Group or association	Owner	Published cost	Scale claim	Performance claim
IT Nation Evolve (formerly HTG)	ConnectWise, since Jan 2018	Not published	1,000+ members (program page)	24% EBITDA improvement, no method
TruPeer / TruMethods	Kaseya, since May 2021	EMERGE tier $999 to join; standard fees “in the thousands”	Nearly 20% of the 2021 MSP 501 used the framework (Kaseya)	Higher seat prices, vendor-asserted
Pax8 Academy peer groups	Pax8 (distributor)	Bundled with the distributor relationship	15 groups, 130+ MSPs	Cloud revenue through Pax8 doubles, no method
The Tech Tribe	Independent (Nigel Moore)	$59 or $79 a month	”1,000’s of MSPs”	None stated
MSPAlliance	Independent association, 2000	Free	30,000+ members (self-reported)	Certification programs

4. Referral and alliance partnerships

Ask any MSP owner where clients come from and the first word is referrals. Then ask for the number. In GTIA’s 2025 State of the Channel survey of 404 North American channel firms, 35 percent named referrals and customer testimony as a tactic for winning business, but that is a tactic, not a share of revenue. Kaseya’s 2026 survey of 1,061 MSPs found 12 percent still name having no lead-generation strategy as their biggest obstacle to winning clients. Neither survey, nor Kaseya’s 2024 benchmark, nor Datto’s 2023 report, asks what fraction of new clients arrived through a referral partner. The channel every owner names first is the channel nobody has measured.

The classic referral partners are the firms the client already pays: the accountant, the lawyer, the insurance broker, the software vendor for the client’s trade. Each of those relationships has changed in the last three years, and the change runs the same direction. The referral partner is becoming the competitor.

Accounting firms are the sharpest example. BDO launched BDO Digital in January 2020, bought the IT services firm AdaptaLogix in November 2022, and sells managed IT and cybersecurity under the BDO name. Marcum Technology bought the managed services division of CliftonLarsonAllen effective June 1, 2024: one top-fifteen accounting firm buying an MSP practice from a top-ten one. Sikich, which took a minority investment from Bain Capital in 2024, bought the IT consulting firm Burwood Group in April 2026. The CPA who used to refer IT work now has a division that does it. BDO Alliance USA still lists more than 175 non-CPA member companies, including technology firms, alongside its 250 CPA firms; the door is open, but the host is also cooking.

Cyber insurers went the same way faster. At-Bay announced its own managed detection and response service in October 2023 and made it available to policyholders in January 2024; its page for MSPs now pitches the product as a line the MSP can resell for “recurring cash flow.” Coalition bought the automated MDR provider Wirespeed in November 2025. Channel Dive’s July 2026 report on insurers moving into managed services quoted Techrug’s Justin Reinmuth on what that means for the MSP that referred the client: “Once they get their tentacles in that client, boom, they have account reps that’ll reach out.” Coalition’s own insurance executive framed the logic from the other side: who is more motivated to prevent a claim than the company that pays it. An insurer is a referral partner with the client’s loss data and its own security product. The driver is the insurer’s own product, since the premium story cuts the other way: Marsh has reported declining cyber insurance rates for twelve straight quarters as of mid-2026.

Vertical software vendors split. Clio, the legal practice platform, runs a channel program that pays commissions on referrals and lists MSPs among its partners. Henry Schein One, the dominant dental practice-management vendor, sells dental IT management and support itself. Before building a vertical practice on a software vendor’s referrals, read whether the vendor has an IT services page.

Referral fees themselves are undocumented in any public source with a named author. The trade advice ranges from a share of the first invoice to a flat fee to service credits, and in practice every arrangement is negotiated one at a time. That is the tell: a channel with no published price is a channel nobody is managing.

Referral or alliance partner	What the MSP gets	What has changed	Source
Accounting and advisory firms	Introductions to clients at budget time	BDO, Marcum and Sikich now own IT services practices (2020-2026)	BDO; CPA Practice Advisor, Jun 2024 and Apr 2026
Cyber insurers and brokers	Referrals at renewal, incident response panel status	At-Bay (Jan 2024) and Coalition (Nov 2025) sell MDR to the same client	At-Bay; Coalition; Channel Dive, Jul 2026
Vertical software vendors	Co-marketing and commissions in a vertical	Clio pays referral commissions; Henry Schein One sells dental IT itself	Clio program page; Henry Schein One
Law firms, banks, commercial real estate	Introductions with no formal program	No public program or fee data found	Negative finding
Client-to-client referral	The cheapest lead there is	35% of channel firms use referrals and testimony as a win tactic	GTIA 2025, n=404

5. Technology advisors, telecom agents and marketplaces

The fifth type is a whole industry most MSP owners have met only at a trade show. Technology services distributors, the firms once called master agents, connect independent advisors to carriers and cloud vendors and pay a residual commission on every month the client stays. Omdia’s January 2026 analysis put the 2024 market at 16.6 billion dollars of gross billings, up 14.5 percent, with the top six (Telarus, Intelisys, AVANT, AppDirect, Sandler Partners and Bridgepointe) holding 72.3 percent of it. Then the line that matters for this guide: technology advisors are 86 percent of the partners in that channel, VARs 7 percent, and MSPs 4 percent. Omdia adds that most of the portals, compensation and processes are built for referral commissions, with none of the quoting and service orchestration an MSP runs on.

The scale is real. ScanSource’s May 2025 investor presentation puts Intelisys at about 2.86 billion dollars of annualized net billings with more than 200 suppliers, and says unified communications and contact center were about 28 percent of its fiscal 2024 billings. AppDirect reports more than 1,000 providers, 10,000 advisors and 5 million subscribers, and has put 180 million dollars into a financing program for advisors with the pension fund CDPQ. There is more recurring commission flowing through that channel than through most MSP peer groups combined, and MSPs are one partner in twenty-five.

The economics are the agent’s economics, which is why MSPs have been slow to join. A telecom agent typically earns a residual of 15 to 20 percent of the monthly charge for as long as the client stays, according to the billing platform Rev.io in a May 2026 piece written for MSPs adding voice; no carrier or UCaaS vendor publishes its rate. RingCentral, per Channel Dive in February 2026, pays a twelve-times spiff on contact-center deals and pairs its selling agents with certified delivery partners who do the implementation, because the two roles want different money: the agent wants the upfront, the delivery partner wants the residual base. An MSP can be either. CompassMSP’s December 2025 partnership with AVANT is one dated example of an MSP formally joining the advisor channel.

The cloud marketplaces are the newer version of the same channel with the hyperscaler as the distributor. Microsoft’s multiparty private offers let a software vendor and a channel partner sell one deal through the marketplace, with the partner adding its own margin and paying a 3 percent marketplace fee; AWS’s channel partner private offers give the partner wholesale pricing and the customer contract. Omdia projects hyperscaler marketplace sales rising from 30 billion dollars in 2024 to 163 billion by 2030 with partners handling about 60 percent of transactions. That is a forecast, and nobody has published what share of it an MSP keeps.

One negative finding belongs here. Kaseya’s 2026 survey lists the services MSPs offer, from backup at 79 percent down to identity management, and there is no voice, telecom or unified communications line at all. A 16 billion dollar channel that pays residuals is invisible to the industry’s largest survey.

Advisor, agent or marketplace	Scale	How the MSP is paid	Source
Technology services distributors (top six)	$16.6B gross billings in 2024, 72.3% held by the top six; MSPs 4% of partners	Residual commission on the monthly charge	Omdia, Jan 19, 2026
Intelisys (ScanSource)	About $2.86B annualized billings, 200+ suppliers, UCaaS/CCaaS about 28%	Agency model, residual	ScanSource investor presentation, May 2025
AppDirect	1,000+ providers, 10,000 advisors, $180M advisor financing program	Residual, plus non-dilutive financing	AppDirect and CDPQ, Jan 2024
Telecom agent residual	Industry norm	15 to 20% of the monthly recurring charge	Rev.io, May 2026 (a billing vendor’s figure)
UCaaS vendor program (RingCentral)	One vendor’s structure	12x spiff on contact-center deals; delivery partners hold the residual	Channel Dive, Feb 2026
Microsoft marketplace multiparty private offer	Hyperscaler marketplace	Partner sets its margin, pays a 3% marketplace fee	Microsoft Partner Center docs, 2026
AWS channel partner private offer	Hyperscaler marketplace	Wholesale price, partner owns the customer contract	AWS Marketplace, 2026

6. Capital and brand partnerships

The sixth type is the one the reader of this guide is party to. When a fund buys an MSP, the press release calls it a partnership more often than not, and the word is doing work.

AEA Investors’ February 3, 2026 release was headlined “AEA Partners with Magna5”; the second paragraph says AEA made a majority investment. Omega Systems announced “a strategic investment” from Revelstoke in January 2025 under a headline that said partners; the split was not disclosed. New Charter, backed by Oval Partners, announces each add-on as a strategic partnership under an equity-sharing model, and did so for Verus and ProTech in January 2025. Sourcepass called Liberty Technology, in December 2025, the thirteenth organization to join its ecosystem. When Sterling Investment Partners bought Cyber Advisors in March 2026, both chief executives used the word partner for a control transaction. Evergreen Services Group, which made 47 acquisitions in 2025 including 33 MSPs, describes itself as a family of partners running a buy-and-hold strategy where the acquired business keeps its name. The one platform in this set that says acquired is The 20, which acquired four MSPs on June 2, 2026 and said so.

The word is not dishonest. It describes the structure most of these deals have. M&A Signal’s 2026 MSP M&A report says most acquisitions include rollover equity, with the seller keeping a stake in the platform, and puts the usual range at 10 to 30 percent of deal proceeds. A seller who rolls 20 percent and stays on as a general manager is, in the plain sense, a partner. What the word hides is control, and control is what the operating review is about.

A second capital partnership competes with the fund for the same owners: the franchise. TeamLogic IT reports more than 300 offices; its franchise disclosure sets the initial fee at 49,500 dollars and the royalty at 7 percent of gross sales with a 1,000 dollar monthly minimum from the thirteenth month. CMIT Solutions has about 300 units, a 7 percent royalty and an initial fee of roughly 50,000 to 60,000 dollars; its franchisor was bought by the private equity firm HKW in January 2023 with more than 250 franchisees and over 100 million dollars of system revenue. The owner who takes the franchise instead of the fund has signed with a different fund.

The partnership that matters most at closing is the one in the vendor contract. The Microsoft Partner Agreement says neither party may assign it, “whether by merger, asset sale, operation of law, or otherwise,” without the other’s prior written approval, and requires the partner to notify Microsoft promptly of significant changes in ownership, mergers or divestments. Every add-on trips that clause. Generic M&A diligence flags any vendor above 25 to 30 percent of costs and treats contracts that need third-party consent as red flags, but across two research passes I could not find an MSP-specific quality-of-earnings methodology that names vendor concentration, assignability or partner-sourced revenue as a checked item. The clause is in the contract. The checklist does not mention it.

Form of capital or brand partnership	What the seller keeps	What it costs	Example
Majority investment called a partnership	Rollover stake, often a role	Control	AEA and Magna5, Feb 2026
Strategic investment, split undisclosed	Unknown from the release	Unknown	Revelstoke and Omega Systems, Jan 2025
Equity-sharing add-on	Brand, local leadership, platform equity	Control	New Charter (Verus, ProTech), Jan 2025
Buy-and-hold family	Name and operations	Control	Evergreen, 47 deals in 2025
Plain acquisition	Whatever the agreement says	Control	The 20 MSP, 48 deals by Jun 2026
Rollover equity in any of the above	10 to 30% of proceeds rolled into the platform	Liquidity on that portion	M&A Signal, 2026
Franchise	Ownership of the unit	$49,500 to $60,450 upfront, 7% royalty	TeamLogic IT; CMIT Solutions (HKW-owned)
Vendor consent at close	Nothing until Microsoft approves the assignment	Time, and the deal if refused	Microsoft Partner Agreement

What the owner should check

Six types, six questions for the next operating review.

For the vendor partnerships: which of our program statuses have a published end date or a revenue bar we are near, and what is the margin difference between where we sit and the rung below. The Azure Expert MSP retirement and the one million dollar CSP bar are this year’s versions; there will be others.

For the MSP-to-MSP partnerships: what share of the labor we bill is delivered by people we do not employ, and does each client’s agreement allow it. If the answer is unknown, ask the help desk partner; its invoice has the number.

For the peer groups: whose framework are we running the business on, and who sells that firm our software. The advice is not worse for being vendor-owned, but the owner should know.

For the referral partners: by named partner, how many new clients in the trailing twelve months, under what written agreement, and does that partner now sell what we sell. The accountant and the insurer answered the last question for us.

For the advisors and marketplaces: is any of our revenue paid as a residual or a spiff, and if none is, why are we absent from a 16 billion dollar channel that pays monthly.

For the capital partnership: at every add-on, was the vendor consent obtained before the wire, and is anyone on our side testing vendor concentration against a threshold, since the quality-of-earnings provider is not.

The MSP that can answer all six has a partnership strategy. The one that cannot has a list of logos on its website, and the logos are the ones deciding.