Early last month, Windsor’s Cooperative Systems, a managed-IT services provider, purchased Manchester-based Fandotech, including its employees, client base and data center.If the global pandemic has decimated certain sectors of the U.S. economy, it has been a boon for established IT firms like Cooperative Systems, as employees for many clients have transitioned to remote working, providing […]
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Early last month, Windsor’s Cooperative Systems, a managed-IT services provider, purchased Manchester-based Fandotech, including its employees, client base and data center.
If the global pandemic has decimated certain sectors of the U.S. economy, it has been a boon for established IT firms like Cooperative Systems, as employees for many clients have transitioned to remote working, providing an additional need for IT support, security and expertise.
The move also reflects an accelerating trend of mergers and acquisitions in the IT sector, as providers look to expand capabilities that are increasingly in demand.
According to market research by Valuates Reports, global managed services are expected to grow by nearly 10% annually over the next five years, with the sector’s revenue reaching $309.5 billion in 2025. Cloud-managed services are estimated to increase by 50% over that time span.
That projected growth reflects the value that businesses are placing on IT expertise in a digitally connected world with increased concerns about cybersecurity, says Scott Spatz, president of Cooperative Systems, which serves a New England-wide client base.
Spatz says the growing complexity of IT systems, including servers, networks, cybersecurity protections, data backup and disaster-recovery systems, are driving more businesses to outsource their IT needs.
“Unless a company can integrate those [functions] all together, it won’t have the intelligence and information to know what’s going on [with IT] efficiently,” he said.
That integration has been a key differentiator with clients in heavily regulated markets — like health care, manufacturing and financial services — that have fueled Cooperative Systems’ growth since its founding in 1993, Spatz said.
The Fandotech purchase has increased the company’s revenue by 60% and its employee base to 37 workers.
He notes his firm’s standardized, yet flexible, suite of services — including IT policy and procedure documents to satisfy regulatory requirements — allows Cooperative Systems to provide added value to clients and scale its offering, which Spatz sees as a competitive advantage.
Michelle Coppola, chief operating officer of Manchester-based insurance brokerage firm Northeast Brokerage, points to the evolving regulatory environment and her firm’s multiple locations among the reasons her company transitioned its IT needs to Cooperative Systems nearly 10 years ago.
“We need our team supported with hands-on technical support to keep them functional and not worried about hardware and software [concerns],” Coppola said. “Our [IT support] has made that possible especially as all our employees worked remotely.”
That peace of mind is something that is harder for small to mid-sized companies to achieve with a one- or two-person in-house tech team, Spatz said.
He notes that managed-IT personnel often provide a greater level of expertise because they confront and learn from IT issues — including cybersecurity risks — across multiple sectors, which enables them to proactively customize solutions to clients’ potential needs.
But it’s not just traditional services like monitoring and tech support that are driving Cooperative Systems’ growth, Spatz contends — it’s also about understanding, and planning for, a client’s future technology needs.
As technology systems become an increasingly essential component to driving businesses’ bottom lines, client management and customer communication, having a high caliber expertise is a value add.
“We want to help clients think through the next three, five or 10 years to make sure they have a proper technology plan to [meet] their business’s needs,” Spatz said. “We are discussing [those needs] regularly with clients.”
Long-term planning
Spatz is also thinking about his own company’s growth strategy.
He says Cooperative Systems’ recent acquisition — which increased its client base by more than 50% — was a key component to expanding its infrastructure capabilities with a long-term goal of doubling revenue over the next eight to 10 years.
“Our new data center and [Fandotech’s] established cloud practice allows us to scale our business more than ever before and drive more cost-effective solutions for our clients,” Spatz said.
And as companies — and their remote workers — look to weather the pandemic and plan for tech-driven business necessities, the managed-IT boon is likely to continue.
