Node4 tweaks M&A strategy to work with market shifts, MSP tells CRN

Two Node4 directors chatted to CRN following its third acquisition in 18 months

Mark Cox (left) and Paul Bryce (right)

Image:
Mark Cox (left) and Paul Bryce (right)

Node4 is having to change with the times as the market shifts following the impact of the Covid-19 pandemic and current inflationary pressures.

The Derby-based MSP snapped up ThreeTwoFour earlier this year.

Paul Bryce, managing director, and Mark Cox, director of M&A, spoke to CRN about the reasons behind Node4's third M&A move in 18 months

"It had been in the works for a while. I've been at Node4 for about 18 months now. As I joined, cybersecurity was top of the list in terms of priorities to look at both organically through M&A," says Cox.

"We were subscale compared to the market opportunity in terms of our staffing and our capability in that area, so it was a priority for a long time.

"It's a nice complement to what we have in terms of cybersecurity which is more of a technology, platform-based offering and a managed services element. They have a consultative-led offering.

"I think it puts us squarely into consulting-led conversations with enterprise clients."

Historically, Node hasn't been afraid to splash the cash on an acquisition, making ten deals in about ten years, most recently snapping up the likes of risual and Tisski prior to ThreeTwoFour.

Lifting the lid on how the MSP's M&A game plan has changed over time, Cox reveals it's not all about growth, but rather strategy.

"The M&A strategy has not just been about buy and scale. It's always been about adding capability and this is a new capability as well for us," he says.

"The last 18 months we've done three quite large deals. I think we have built quite a considerable platform now, and I think the future M&A strategy will be to look to tuck into particular areas that we'd want to bolster in terms of capability around data, different pockets of Microsoft skills where we think there's more opportunity."

Bryce emphasises Cox's point around strategic growth, sharing what Node4 wants out of a deal.

"It's more about is it complementary? Does it give us access to a different market? Does it add a technology area that we see as an opportunity or want to enhance what we're doing? Or it might be a skill set of people."

Keep reading to hear more on Node4's growth strategy and how it's dealing with market changes...