To paraphrase Rodney Dangerfield, “I’m ok now, but last week was rough”, particularly for Managed Service Providers “MSPs”.
Great Lakes Tech Services is largely built around the offerings of Datto. Datto is the company who provides our ticketing and time tracking software, our remote monitoring and management software, our server backup devices, offsite backup storage, PC backups, Office 365 backups, and a few other things. Datto has been our best vendor since we signed on with them in 2011.
Monday morning (April 11th), we got a mass e-mail from Datto’s CEO announcing that they were acquired by Kaseya. The industry has three big players and an assortment of smaller ones. ConnectWise is the largest, followed by Datto. Kaseya falls somewhere down the list. Somehow, they used a private equity firm to leverage the buyout.
The problem is that Kaseya is, in my opinion as someone who deals daily with computer/network security, an unethical company. They tried to cover up a ransomware attack affecting end users, they try to trap their customers in three-year auto-renewing contracts with restrictive cancellation policies, threaten legal action, and are generally bad people. They have a track record of acquiring companies and running them into the ground. Google ITGlue for the latest example.
Great Lakes Tech Services Reaction Week One:
First, congratulations to the Datto executives. You built a highly successful company and sold it for a very handsome profit. That’s the goal of every business owner I know (except farmers). You guys were great partners and will be missed. Take the windfall and enjoy it — I mean that sincerely.
We spent most of Monday stunned and thinking about how to handle this. By Monday afternoon, we were watching a demo from one of their competitors. We are researching alternatives for all these services. Sadly, Datto is the best overall product in many cases, but we won’t give our money to Kaseya.
By the time this buyout is finalized, we should have everything moved that is possible to move. Some of it is under contract and I’ll have to wait on those items.
In similar news, Barracuda was acquired from Thoma Bravo by KKR. That is just a move from one private equity firm to another, so we expect little change. Great Lakes Tech Services uses Barracuda only for e-mail security.
We will work to minimize the impact on our clients. In the end, we should have great solutions in place for these services — but they will be from several different vendors rather than just one.
Managed Service Providers Reactions Week Two:
First, many Managed Services Providers reacted much like we did. Vendors we spoke with are enjoying a huge increase in inquiries.
The good news: Datto continues to run as it did before.
Competitive Vendors for Managed Service Providers Respond Week Three (this week):
The good news times two: Datto continues to run as it did before; Industry resources respond well.
Competitors are pulling out the stops with deals to take advantage of significant industry migrations. We like the appeal, but continue to look at the core strengths of offerings. We want proven long-term partners to help us take care of our clients. We’ll keep you posted.
We welcome your comments, questions and suggestions. Please contact us with questions. Best to call, email or visit our site for the best response. We do invite you to engage with us on social media (just not for immediate needs).