Fred Voccola, CEO of Kaseya, tells Technology Reseller why we’re on the cusp of a golden age for MSPs
Fred Voccola, CEO of Kaseya, a provider of unified IT management and security software for managed service providers, says MSPs are living through a golden age – and then lists a multitude of irritants they have to contend with daily.
These range from the hassle of managing multiple supplier relationships to tight-fisted customers who are slow to spend but quick to complain to the inefficiencies of poorly integrated products and patchy automation.
With so many aggravations to contend with, can this really be a golden age? Voccola believes it is for two reasons.
“One is that a larger percentage of the global economy is made up of small to midsize businesses, and that trend is going to continue for the foreseeable future. The other is that small to midsize businesses are becoming more and more dependent on technology to allow them to be competitive, and they need that technology to be always available.”
These two trends, he suggests, are driving demand for technology and managed services and fuelling average MSP growth of 12.5% – or 16% for Kaseya customers – compared to global growth of 2.5% to 3%.
To illustrate the point, Voccola cites the growing demand for cybersecurity expertise.
“As companies become more reliant on technology and spend more on technology, bad people are going to go after them more, because they know if they catch them out they will pay more for a ransom or some other way to keep their technology going. So, attacks are going to increase. A 24-person company cannot afford to hire five IT and security people to strengthen its defences, so they’re going to continue to do it with MSPs. That is the fundamental trend, and that trend will not change.”
Technology-first businesses
Earlier in the day, at a Kaseya+Datto Connect Local event in London, attended by around 170 MSPs, Voccola explained that the MSP customer base of small and mid-sized businesses was expanding, pointing out that SMBs with fewer than 2,000 employees were the largest and fastest growing part of global GDP.
“We think in the next 24 to 48 months that’s going to continue. Almost 70% of new jobs will be created by your customers and people like your customers,” he said.
At the same time, SMBs are transforming themselves into technology-first companies, with nine out of 10 small businesses expecting to spend a larger percentage of their revenue on technology.
“In the early ‘90s, we saw the Fortune 5000 companies and governments go through the same kind of digital transformation, with ERP, e-commerce, supply chain management. Those applications changed how enterprises function. We’re now seeing the same thing happen to your customers.”
Voccola adds that this transformation is fundamentally changing the relationship SMEs have with technology.
“In 2015, we asked small to midsize businesses if they were dependent on their technology and about half said they were, saying they needed applications to be ‘mostly available’ and ‘mostly secure’. We asked that same question last year and 93% said they are dependent on technology and now need applications to be ‘always available’ and ‘always secure’.
“The job of an MSP is to make sure that the business applications that these organisations leverage are always available and always secure. That’s why this industry has been exploding for the last decade. And it will continue to explode for the next decade, because that digital transformation is only about one third of the way through.”
A single platform
So, what about all those irritants? How are they compatible with a golden age for MSPs?
That’s where the Kaseya IT Complete platform comes in. With 40 modules and more than 1,300 integrations, this aims to give MSPs everything they need to run their business and deliver every type of managed service, all in one place with a high degree of automation and integration.
The argument goes that having just one platform from one vendor has the potential to alleviate four key challenges facing MSPs – vendor fatigue, limited integration, poor utilisation of features and high costs.
IT Complete enables MSPs to reduce the number of vendors they must deal with, as well as the number of tools their ‘multifunction technicians’ rely on to meet customer requirements – as many as 17 in the average MSP. Because Kaseya modules are tightly integrated, they should provide more effective automation, for enhanced productivity and accuracy.
In addition, Kaseya says its pricing policy is designed to make it 30% to 50% cheaper for MSPs to add new services from the IT Complete stack.
Voccola says this is important because customers tend to underestimate the cost of making an application ‘always available’ and ‘always secure’, which he puts at three or four times the cost of the application itself – rather than 40% of the cost, which is what he says non-technical customers typically expect to pay.
He suggests that the divergence between what the customer wants to pay and the real cost of ensuring something is ‘always secure’ and ‘always available’ is only going to increase as security threats grow, forcing MSPs to do more with less.
“About 22% of MSPs’ revenue is allocated to software costs. Most MSPs are not delivering every type of service they want to for their client, because they can’t afford to,” he said.
“We charge a lot less. So even if a client won’t pay you extra to put EDR on an endpoint our intention is to charge such a low amount for our EDR that if, for whatever reason, that customer won’t pay for it, you can still put it on the endpoint because it’s the right thing to do and because if you don’t and that endpoint gets breached, even though it was the customer’s fault, you’ll get the blame. We also have something called the Cyber Insurance Fast Track programme, which will be available here in the UK by the end of March. If you’re using the Kaseya security stack, you will automatically qualify for, I believe, £1.5 million of cyber protection at about 50% below market rate. The only requirement is that you protect the customer with Kaseya Security.”
New branding
You can expect to hear a lot more about the benefits of IT Complete in the coming months as Kaseya rolls out additional features and new ‘Powered by Kaseya’ branding to reinforce the benefits of using the platform.
“With Powered by Kaseya, we’re building a brand like Intel Inside back in the ‘90s. We want the world to realise that an MSP that’s Powered by Kaseya is powered by the best. With the announcement we’re making (at Kaseya Connect Global, Las Vegas, April 29-May 2), I think the industry will see that if you are an IT MSP and you are Powered by Kaseya, the technical capabilities you have and the financial capabilities you have will allow you to thrive in the new era of MSPs. We think this will be the foundation of a golden age of MSPs. The opportunities that MSPs have are just tremendous, and I think MSPs Powered by Kaseya will be the ones that are able to fully deliver for their customers and for themselves.”
Voccola adds that this campaign is targeted not only at MSPs but also at their customers.
“If I’m a construction company or a solicitor, any kind of business, and my IT and security are not powered by Kaseya, I’m going to question it. The brand Kaseya is being built worldwide. We have the naming rights for a very popular sports arena in the US (the Kaseya Center in Miami, Florida), and there will be things like that coming in Europe and other places, as well as some very big announcements in April. We believe demand will not be for IT and security services, but for Kaseya-powered IT and security services. That’ll be a massive advantage to MSPs Powered by Kaseya.”
MSPs can find out more about Kaseya’s plans by attending Kaseya DattoCON Europe in Dublin on June 11-13 2024. Kaseya is expecting 1,500 MSPs from across Europe at the event and is advising those interested to buy tickets early, on the basis that Kaseya Connect Global in Las Vegas sold out 60 days before its start date of April 29. Find out more at https://www.dattocon.com/europe/
Mixed blessings
Kaseya’s newly released 2024 MSP Benchmark Report highlights the importance of cybersecurity as an engine of growth.
Almost three quarters (73%) of MSPs in the Americas, EMEA and APAC describe cybersecurity as a top revenue driver for their business, with 78% regarding cybersecurity as a top IT challenge faced by their customers, up from 67% last year.
Almost half (46%) of MSPs report that most of their clients now turn to them for advice on cybersecurity plans and best practices.
Although cybersecurity is seen as a key focus for clients, the top challenge facing MSPs this year is expected to be customer acquisition, cited by 36%, up from 24% in 2023.
In second and third place are dealing with advanced security threats (19%, unchanged from 2023) and hiring (12%, down from 14% last year).
The survey findings validate the underlying rationale for Kaseya’s IT Complete platform, with 85% describing automation as a must-have and 67% of MSP leaders stating that integration between core MSP applications is very important for their work.
Three quarters of participants (75%) agreed that integration between applications is a time-saving measure, with 70% stating that it boosts the productivity of technicians. More than half of MSP executives (as opposed to technicians) said it saved them money (55%) and enabled them to take on more clients (54%).
AI also has potential to help in this area, with 33% of MSPs hoping to use it to eliminate tedious tasks and 15% to improve security vs. 20% who believe AI will increase security risks.
More than one third of MSPs (37%) cited implementing AI and machine learning as a top IT challenge for their clients this year.
https://www.kaseya.com/resource/2024-msp-benchmark-survey-report/
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