Most MSP partnerships don't fail in a single moment. They fail slowly — through years of avoided conversations, boilerplate operating agreements, and the quiet assumption that shared history is the same thing as shared vision. By the time a third party gets involved, the damage is rarely the presenting issue. It's almost always something deeper: undefined roles, misaligned expectations, and equity structures that were never designed to withstand growth. At Bering McKinley, we see this pattern more than almost any other — and it's why the client engagement work we do so often begins not with growth strategy, but with partnership triage.
In this BMK Vision Roundtable, Josh Peterson and Gary Boyle pull from live client situations to examine what actually breaks MSP partnerships — and what owners can do to get ahead of it before the cost becomes irreversible. This is not a conversation about conflict resolution tactics. It's a frank examination of the structural decisions most MSP partners never make, and the leadership clarity that separates businesses that scale from ones that stall. If you're in a partnership — or thinking about entering one — this episode will surface blind spots you didn't know you had.
The origin story of most MSP partnerships contains the seeds of their eventual failure. Two technicians leave the same employer. They bond over shared frustration, shared clients, and the mutual belief that they could run things better. What they rarely bond over is a clear answer to the question that actually matters: what does each of us do that the other cannot? When the answer is "roughly the same thing," the partnership has a structural problem from day one — one that early momentum will mask but never fix. The first few years of client acquisition feel like proof of concept. They are not. They are borrowed time.
There is a belief that runs through the MSP industry with remarkable consistency: that building a business on referrals is a competitive advantage. It is not. It is the default condition of every small business in its first decade — and treating it as a superpower is one of the clearest signals that a leadership team hasn't yet asked harder questions about how they intend to grow. Referral networks have a ceiling tied almost entirely to the personal network of the founders, and it reveals itself around the one-million-dollar revenue mark, typically after five to seven years. The business hasn't stalled because the market changed. It's stalled because the partnership was never designed to grow beyond what two people could generate through relationships alone.
Equal equity splits feel fair at the start. In practice, they create a leadership vacuum that becomes harder to resolve the longer it goes unaddressed. When no partner holds a decisive stake, every significant decision requires consensus — and consensus under pressure tends to produce delay, resentment, or both. The more telling problem is what happens when one partner isn't performing. In a 50/50 structure, there is no default authority to act. The operating agreement is usually boilerplate that neither partner fully understands. Buy-sell provisions, if present, are vague. Role expectations were never tied to equity. The result is a business where the stakes are high and the accountability structure is essentially informal.
MSP owners rarely engage a consultant because their partnership is broken. They engage because utilization is low, sales are flat, or they can't figure out why the business has plateaued. The partnership fracture reveals itself later — usually within the first few sessions, when a third party starts asking which owner is accountable for which outcomes and the room goes quiet. This is where a structured operating system does something that conversation alone cannot: it creates a neutral framework for surfacing what the partners already know but haven't said out loud. Who owns growth? Who owns service delivery? Who is actually performing at the level this business needs? These aren't comfortable questions. They're necessary ones — and the longer they go unasked, the more expensive the answer becomes.
Not every broken partnership should be dissolved. Some should be restructured. The distinction matters — and it requires honest assessment of whether both partners are capable of performing at the level the business needs, not just willing. Willingness without capability is a trap that costs the stronger partner years. The more productive question is whether a restructured equity arrangement — one where a non-performing partner retains ownership but exits operations — is viable. It can be. But it requires the remaining partner to accept a profit-share obligation they'd rather not carry, and the exiting partner to accept a role reduction that feels like a verdict on their performance. Neither conversation is comfortable. Both are better than the alternative of doing nothing.
Because most partnerships form around shared history and mutual trust, not complementary skills. Role clarity requires a harder conversation than most partners are willing to have before the stakes feel real.
Undefined roles and the absence of a structured operating agreement that ties equity to performance expectations. Most failures are structural, not personal.
It can work in the early years, but it creates a leadership vacuum as the business grows. A majority stake — even a small one — designates a default decision-maker and reduces the risk of stalemate under pressure.
At minimum: defined role expectations for each partner, a process for evaluating whether those expectations are being met, a valuation methodology, and a clear process for buyout if one partner wants to exit or is asked to leave.
Yes, but it requires intentional restructuring — typically a higher compensation plan for the remaining operating partner and annual dividends rather than salary for the passive partner. It works best when both parties agree before resentment sets in.
Before the breaking point. If equity, role, or accountability questions are surfacing more than occasionally, that's the signal. Waiting until dissolution is imminent dramatically increases the cost — financially and operationally.
Gary Boyle is a Partner for Strategy & Business Development at Bering McKinley. With a background spanning network engineering, entrepreneurship, and strategic consulting, Gary brings real-world operator experience to helping MSP owners build stronger, more profitable businesses. He has navigated partnership structures firsthand and brings that perspective directly to every conversation about MSP business design and leadership.
Connect with Gary Boyle on LinkedIn →
Josh Peterson is the CEO of Bering McKinley and host of The BMK Vision Podcast. Since 2004, Josh has worked with hundreds of MSP owners to build operationally sound, profitable businesses through consulting, peer teams, and direct coaching.
Connect with Josh Peterson on LinkedIn →
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