The electricity analogy at the end really resonated. The irony you highlighted that tech hasn't modernized its own plumbing is something I think about a lot. Every other vertical has been reshaped by software eating its coordination layer, but IT services somehow got a pass because the work felt too context-dependent to automate.
This has the potential to define a new category: AI-native SMB consulting fused with integrated product engineering. The real shift is from legacy MSPs that manage complexity to new-age partners that build, integrate, and continuously evolve highly customized AI-native systems that accelerate adoption at the operating-core level. The winners will be those who turn services into intelligent, compounding software-led outcomes.
This is a great illustration of a pattern I have been writing about. IT services sits in a fascinating spot on what I call the Trust-Task Matrix: most of the day-to-day work (ticket resolution, patch management, access provisioning, compliance monitoring) is high routine and moderate trust. That puts it squarely in the AUTOMATE and VERIFY quadrants, which is exactly why it is ripe for AI-native disruption.
The 40,000 fragmented MSPs with fewer than 10 employees, aging operating models, and no structural incentive to innovate is also a textbook setup for the buy-and-transform playbook. I spent two years evaluating 200+ companies in fragmented service verticals through a search fund. IT services checks every box: sticky client relationships, predictable cash flows, zero tech adoption, and owners ready to exit.
I wrote about this thesis this Monday,
including the Trust-Task Matrix framework and an argument about why the current margin assumptions are built on subsidized AI inference.
This sounds very interesting and necessary. I would like to see it in operation.
The electricity analogy at the end really resonated. The irony you highlighted that tech hasn't modernized its own plumbing is something I think about a lot. Every other vertical has been reshaped by software eating its coordination layer, but IT services somehow got a pass because the work felt too context-dependent to automate.
This has the potential to define a new category: AI-native SMB consulting fused with integrated product engineering. The real shift is from legacy MSPs that manage complexity to new-age partners that build, integrate, and continuously evolve highly customized AI-native systems that accelerate adoption at the operating-core level. The winners will be those who turn services into intelligent, compounding software-led outcomes.
Shakegraph.com/manifesto the most powerful intelligent technology for SMBs is already here, in stealth.
This is a great illustration of a pattern I have been writing about. IT services sits in a fascinating spot on what I call the Trust-Task Matrix: most of the day-to-day work (ticket resolution, patch management, access provisioning, compliance monitoring) is high routine and moderate trust. That puts it squarely in the AUTOMATE and VERIFY quadrants, which is exactly why it is ripe for AI-native disruption.
The 40,000 fragmented MSPs with fewer than 10 employees, aging operating models, and no structural incentive to innovate is also a textbook setup for the buy-and-transform playbook. I spent two years evaluating 200+ companies in fragmented service verticals through a search fund. IT services checks every box: sticky client relationships, predictable cash flows, zero tech adoption, and owners ready to exit.
I wrote about this thesis this Monday,
including the Trust-Task Matrix framework and an argument about why the current margin assumptions are built on subsidized AI inference.
chiponmyshoulder.substack.com/p/the-16-trillion-flip
Do I need to optimize software BOMs too?
Agree, that's one reason why I support DATS a distributed real time threats protocol
Yes… I still develop www.trustgov.tech for that