Original Article: High Wire Networks Aims To Quadruple Cybersecurity Sales This Year | CRN
‘Automation, plain and simple. We’ve invested tremendous amounts of money in automation in every aspect of our business, but in cybersecurity it is the only way to keep up with what’s going on,’ says Mark Porter, chairman and CEO of High Wire Networks, on what the company is investing in this year.
Mark Porter, CEO
After seeing its security user base expand by more than 430 percent over the last year, High Wire Networks is investing heavily into its cybersecurity services as it expects to quadruple its revenue in 2023.
“That one really is attributable to the fact that when we talk to the MSP community, they are looking at how to tackle the business problem of cybersecurity,” Mark Porter, chairman and CEO of High Wire Networks, told CRN. “It’s really this mega-trend of tool sprawl and continuing complexity in cybersecurity, and the typical MSP doesn’t have an answer. While we’ve been at shows, [we’ve been hearing] over and over that they don’t have the horsepower internally to do it 24/7.”
But Batavia, Ill.-based High Wire Networks, which is on CRN’s 2023 MSP Elite 150 list, has the scale to do it.
High Wire delivers managed security services, through its in-house Overwatch entity, and IT services to about 1,000 managed security customers and tens of thousands of technology customers.
Last year, managed cybersecurity revenue jumped 111 percent in the first half of 2022. And that is only going to grow as Porter said the company is focusing on automation in cybersecurity.
“Automation, plain and simple,” he said. “We’ve invested tremendous amounts of money in automation in every aspect of our business, but in cybersecurity it is the only way to keep up with what’s going on.”
There will also be changes to its Overwatch managed security partner program which will further help MSPs in demand generation, service delivery and onboarding and enablement.
“The updated program is designed around helping partners from end to end of their business from the sales and marketing side on through to the technical and operations aspect,” Stephan Tallent, CRO of High Wire Networks, told CRN. “In many scenarios, we’ve got partners that are working with us in delivering security services and they’ve got eyes on glass as well from the perspective of the customer deliverable. The goal of the program is to support the different areas of the partners business and growing their recurring revenue streams around security services.”
CRN spoke with Porter about the growth the organization is seeing, M&A and doubling down on cybersecurity services.
High Wire’s Overwatch has expanded more than 430 percent in the last year. What do you contribute that growth to?
That one really is attributable to the fact that when we talk to the MSP community, they are looking at how to tackle the business problem of cybersecurity. It’s really this mega trend of tool sprawl and continuing complexity in cybersecurity, and the typical MSP doesn’t have an answer. While we’ve been at shows, [we’ve been hearing] over and over that they don’t have the horsepower internally to do it 24/7. They might have a set of 20, 30, 40 customers, we’ve got 1,000 customers, so when we’re vetting products, testing products and evaluating things, were able to do it at a scale that they can’t. We’re taking the complexity out of it for them and building a business. The other big driver now is that our traditional technology customers, customers that we deploy technology around the world for, those partners are embracing us and bringing us into very, very large enterprise deals which is moving the needle very fast.
What is the company investing in most this year?
Automation, plain and simple. We’ve invested tremendous amounts of money in automation in every aspect of our business, but in cybersecurity it is the only way to keep up with what’s going on.
Where do you think the company will see the most revenue growth this year?
We are seeing growth across all of our segments, it’s pretty substantial. We’ve published a forward looking guidance of about 74 percent growth this year. Large portions of that will come from each segment of the business. We’re expecting to possibly quadruple our security revenue from last year. Everything we do is long-term monthly recurring contracts, and as we go into the enterprise space we’re seeing big contracts that are in the high seven figure annual values.
What is your biggest challenge right now in your company and how do you plan to overcome it?
The biggest business challenges that I think we face is there’s a tremendous amount of uncertainty in the market. For us, the good news is that leads to a downturn in the technology side of the business which leads to a downturn in our customers’ self-performing work, if there’s even such a thing anymore. Everybody’s really rationalized their professional services workforce, so it leads to an uptick there. We’re looking at tremendous pipeline and demand for the year, it’s really going to be a matter of making sure that supply chain holds, credit markets don’t go completely wonky and that we can see continued execution from our teams. Everything is in place to make it happen, we just have to execute.
What do you want more from your vendor partners?
Stephen is pioneering for us a managed firewall and managed SD-WAN (software-defined wide area network) play with Fortinet. They’re setting a pretty strong example of how they want to go to market and work with people like us. What we see is that vendor partners often want to leverage you as a path to market, but they don’t always want to provide integrations and support. We can’t integrate something into a real true stack that benefits our partners and provides the value that enterprise customers need, and that our partners need, without true integrations. The way we go about solving for this massive problem with cybersecurity is by integrating an ecosystem for the customer. So if you have closed API’s, you’re not willing to work on development on those API’s and provide some of the things you need technically, you’re not really solving a problem. You’re kind of exacerbating an existing problem, and we see tools for all and proliferation as a continued thing. I think there’s twice as many products in the space for cybersecurity as there were four years ago. We need more openness, more integration and more real go to market savviness on how to solve business problems.
What is your take on all the M&A in the industry right now?
I think it’s a necessary evil. We’ve actually publicly stated that we were focused on looking at ways to consolidate in the industry as well. There is a chasm for the managed service provider community, and it’s getting harder. There’s other business drivers, not just technology, drivers like cybersecurity insurance and that whole rabbit hole of a problem for customers today. So it’s probably going to be necessary but I think as credit markets tighten it’s going to be even more practical. There’s going to be capitulation and consolidation. Credits are already really tight and this cycle is a lot different than most people have experienced in their professional careers.
What’s High Wire’s M&A strategy?
We’re focused on a couple of scenarios. We’ve been developing some of our own intellectual property that we think will give us some competitive advantages. We’ve been raising capital and eliminating debt which is really critically important to be well positioned for the next cycle. We see opportunities to work with MSPs in a different way who might want to monetize their revenue streams, but not necessarily sell their business. We do see an opportunity as we can deliver the same managed services that they are with a tremendous amount of automation and scale. We can do it more cost effectively and create a win win for both our partners who are looking for that monetization of their business and maybe set themselves up for their eventual retirement but continue working and selling. We see it as a slightly novel approach to potentially rolling up some of that revenue and still keeping the business autonomous to a degree.
What are your general thoughts on ChatGPT?
ChatGPT is changing everything and has implications across a very wide swath of the industry. We’re leveraging it in a couple of ways already. It’s very primitive at this point but we’re leveraging it to write code and automations. We have some people on our development team looking at it to write security detections and do things faster, and of course customer service and other automation capabilities.
What other market trends are you watching right now?
I’m very interested in the return to work that’s going on. It’s driving a tremendous amount of activity, especially in our technology business. But even that is being driven by cybersecurity because you’ve got all this return to work with outdated hardware and outdated protocols. Customers are really forced to do significant upgrades to make that up to standard for security reasons.
Are you seeing a lot of MSPs or customers on your end going back to work?
I think you’re going to see a lot of hybrid, but we are seeing a lot of customers refreshing. We’re also seeing a pretty substantial amount of large customers, or retail customers, that focus on customer experience upgrading Wi-Fi networks and other things at a pretty substantial clip. The other piece that we see is the expanding attack surface in cyber. It’s driving changes and that’s one of the areas where we’re really looking at the browser as sort of the next great frontier. We’re working on some stuff in that space.
What can we expect to see from High Wire for the rest of the year?
With innovation we’re going be pushing the boundaries on a couple of fronts in the cybersecurity space and working with our partners to make sure that we’re meeting their needs. We have a real focus this year on executing on partner enablement and making sure that the areas where we need to improve on make both the partner experience and their end customer experience better. Simply put, we’re going to continue to innovate in that space.
