Generate More Referrals for MSPs

Looking to generate more referrals for MSPs? Relying on** sporadic, passive referrals** often leads to a feast-and-famine business cycle for Managed Service Providers (MSPs). Early on, referrals can show up organically—sometimes in enough volume that other lead generation and sales activities get ignored. Then the referrals slow down, and growth slows with them.

Date Published: September 24, 2024 Date Last Updated: January 19, 2026

Part of the MSP Sales Process is an MSP Referral Generation course that teaches MSPs how to generate more referrals for MSPs and create a reliable funnel by measuring client health and account management activities.

In this post, we summarize one of the lessons from that course: the five KPIs that make referral generation predictable.

Definition: To** generate more referrals for MSPs** consistently, you need a repeatable client review rhythm, clear visibility into client relationship status, and a standard decision for what to do next.

Why MSP Referrals Stall

Most referral problems are not “marketing” problems.

They are process problems.

If you do not have a defined way to review clients, classify relationship health, and take the next step, referrals arrive randomly—and random referrals create random growth.

Hope Is Not a Business Development Strategy

Without a strategy to generate more referrals for MSPs, gaps between referrals cause stagnation. At some point, the referrals you relied on stop flowing. Many MSP owners respond by hiring outsourced lead generation, believing they need a new tactic for getting leads.

Waiting for referrals means putting your future growth in the hands of people who do not benefit from your business growing. It is not sales. It is hope.

"Hope has no place in your sales pipeline!"

Carrie has been saying this since 2016 across many platforms and vendors.

Here’s a Barracuda MSP webinar where Carrie shares on referrals and business development...ten years back. The approach MSPs are taking to generate referrals has not evolved much since then. Here's how to fix the problem.

Asking for MSP Referrals Is a Process

"Passive referrals are a gift, not a reliable business development strategy." — Carrie Richardson, MSP Sales Expert, May 2016, Smarter MSP

To break free from the feast-and-famine cycle, asking for referrals must be treated as an essential part of your MSP sales process.

A process is repeatable. A process is documented. A process can be trained.

When it is measured, it can be refined and improved over time.

In 2018, Ian Richardson was running an award-winning MSP in Michigan. He doubled ARR in a little over one year, winning awards and earning placements on lists like MSP501 and Inc5000.

He later published on the MSP software vendor ConnectWise blog, crediting KPI creation and management as one of the major factors involved in that growth.

read the article here.

Why Client Relationships Matter

Your referral system starts with delivering excellent client experiences.

As Ian Richardson emphasizes in the MSP Sales Process Referral Generation Course: “People only refer companies they trust.”

Happy clients are your best advocates. Strong relationships are the foundation for generating more referrals for MSPs.

The Five KPIs That Will Help Generate More Referrals for MSPs

These five KPIs measure the health of your referral process. They focus on what you can control: review coverage, review cadence, and relationship status.

KPI	What It Measures	Primary Decision It Enables
1. Number of Clients Reviewed	How many clients have gone through your review process.	Increase coverage or maintain cadence.
2. Clients Reviewed Per Month	Whether reviews are happening consistently each month.	Add capacity or protect time blocks.
3. Client Health	Clients with no roadblocks to a referral ask.	Ask for referrals (with a script and target profile).
4. Client Risk	Clients requiring retention work due to dissatisfaction.	Fix experience before you ask for anything.
5. Unknown Client Status	Clients not yet reviewed (status unknown).	Schedule reviews; stop assuming health.

Key KPIs for Referral Generation

1. Number of Clients Reviewed

What it is: How many clients have gone through your referral generation process, whether or not a referral was requested.

How to calculate: (Clients reviewed ÷ total active clients) × 100. Active clients are those who paid in the last 12 months.

What it tells you: Low coverage means you are asking for referrals randomly. High coverage means you have a real system.

2. Clients Reviewed Per Month

What it is: The number of client reviews completed in a month.

Target method: Take your total number of active clients and divide it by 12.

What it tells you: If your monthly review count drops, you are building a backlog that will show up later as a referral drought.

3. Client Health

What it is: The percentage of clients with no roadblocks to making a referral. These are clients whose review meetings ended with a successful referral request.

How to calculate: (Clients who completed the referral ask ÷ total active clients) × 100.

What it tells you: When client health improves, you get more opportunities to ask for referrals without forcing it.

4. Client Risk

What it is: The percentage of clients whose reviews ended in retention efforts due to dissatisfaction.

How to calculate: (Clients at risk ÷ total active clients) × 100.

What it tells you: If risk climbs, referral asks should decrease until the experience is repaired.

5. Unknown Client Status

What it is: Clients whose relationship status is unknown because they have not been reviewed.

How to calculate: (Unreviewed clients ÷ total active clients) × 100.

What it tells you: Unknown hides both risk and opportunity. Until you have the conversation, you cannot assume the client is healthy.

Why Referrals Are Not a KPI

One of Richardson’s key insights is that referrals themselves are not a KPI.

“A KPI has to be a number you can impact and control. You could perform this process perfectly and not get a referral.”

You should still track referrals, but treat them as an outcome of the process—not the primary measure of success.

The Five Most Important KPIs for Measuring Referral Success

Number of Clients Reviewed: How much of your client base has gone through the process.
Clients Reviewed Per Month: Whether you are executing consistently.
Client Health: How many clients are in a position to refer you.
Client Risk: How many clients need retention work due to dissatisfaction.
Unknown Client Status: How many clients you are guessing about.

A Process Needs Action

Building a successful referral program for your MSP starts with understanding your clients, reviewing them regularly, and tracking key metrics. You cannot control how many referrals you receive, but consistently following the process positions you to earn more referrals over time.

As Ian Richardson states in the MSP Sales Process Referral Generation Course:

“A perfectly run process doesn’t guarantee a referral, but it gives you the best chance to earn one.”

If you need help building a strategy that results in generating more referrals for MSPs, or creating sales processes for your MSP, get in touch with Carrie Richardson to discuss DIY sales process options and fully supported sales training and sales coaching for MSPs with Fox & Crow Group.

FAQ: Generate More Referrals for MSPs

What is the fastest way to generate more referrals for MSPs?

The fastest reliable way is to run consistent client reviews, confirm trust, and ask for referrals only when client health is strong.

What should an MSP measure to generate more referrals?

Measure review coverage, reviews per month, client health, client risk, and unknown client status. These KPIs show whether you have enough trust and consistency to ask.

Why are referrals not a KPI?

A KPI must be directly controllable. You can run the process perfectly and still not get a referral. Referrals are an outcome, not the primary process measure.

How do I know when to ask a client for referrals?

Ask when the client is healthy and trust is confirmed in a review. If the client is at risk or unknown, fix the experience or schedule the review first.