EP288 - Why Poor Governance is Killing the Value of Your MSP and How to Fix it with Ken Roulston and Ian Luckett

In this episode of The IT Experts Podcast, I sit down with Ken Roulston to explore a topic that many MSP owners know they should be paying attention to, yet often leave until much later than they should. Governance.

Now, before you switch off thinking this is a subject reserved for larger businesses, stay with me. This conversation is one of the most important discussions we've had around protecting the value of your MSP, reducing unnecessary risk and building a business that is genuinely attractive to a future buyer.

Ken brings a huge amount of experience to this conversation. Having built and successfully exited a £17 million MSP, he has seen first hand what separates valuable businesses from those that struggle to achieve the valuation their owners expect. Through his work with MSPs across the UK and Ireland, Ken regularly helps business owners understand the factors that drive value and the mistakes that can quietly destroy it.

One of the points I often make is that every MSP owner will eventually sell their business. Whether that happens in five years, ten years or twenty years is almost irrelevant. At some stage, ownership changes hands. The question is whether you will be rewarded properly for all the hard work, investment and sacrifice that went into building it.

That is where Governance comes in.

Throughout our conversation, Ken and I unpack why Governance is far more than a compliance exercise. Good Governance creates confidence. It gives buyers reassurance. It reduces risk. It demonstrates professionalism. Most importantly, it helps you build a stronger business today, regardless of whether an exit is anywhere on your immediate horizon.

We begin by looking at financial Governance and why understanding your numbers is only part of the story. Many MSP owners can tell you their monthly revenue and profitability. Far fewer fully understand the financial responsibilities that come with being a company director. Ken explains the importance of financial controls, cashflow management, solvency and proper accounting practices. These are not optional activities. They are part of your legal responsibility as a business owner.

We also discuss how poor financial Governance can raise serious red flags during an acquisition. Buyers want confidence that a business is being managed professionally. Strong reporting, clear approval processes, documented decisions and consistent financial management all contribute to a stronger valuation and a smoother due diligence process.

From there, we move into legal Governance, which is often where hidden problems begin to emerge. Ken shares examples of acquisitions where customer contracts, supplier agreements and employee terms created unexpected complications. In some cases, a single clause buried within a contract was enough to significantly impact the value of a deal.

One example in particular highlights how an overlooked contract clause could force a buyer to seek approval from every customer before completing an acquisition. It is a powerful reminder that Governance is not about having paperwork in place. It is about understanding exactly what those documents mean and how they affect the future of your business.

We also spend time discussing employee Governance. As MSP owners, our people remain our greatest investment and often our largest cost. Strong Governance creates clear expectations, supports accountability and helps protect both employees and the business. Ken explains why current employment contracts, documented processes and professional HR support are essential if you want to build a resilient organisation.

Towards the end of the episode, we broaden the conversation into business risk. This is an area we regularly help MSP Growth Hub members address because many business owners spend their days helping clients manage risk while overlooking risks within their own organisations.

Ken shares practical examples of the risks every MSP should be asse