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News & Articles

October 5, 2023 |

Kaseya CEO Calls First 15 Months After Datto Acquisition a ‘Pretty Successful’ but Imperfect Journey

In a conversation with ChannelPro, Fred Voccola (pictured) said Datto partners are now better off in meaningful ways than before the mammoth deal, despite billing problems and complaints about support.

Kaseya CEO Fred Voccola speaks in front of large audiences regularly. He was nervous just the same when he took the stage on day one of last year’s DattoCon partner conference in Washington D.C., and didn’t hesitate to say as much.

“It’s really humbling,” he confessed. “I still can’t believe I’m speaking at DattoCon.”

Neither could many of the people in his audience. It had been just five months, after all, since Kaseya shocked the managed services world by announcing it had acquired Datto in a deal valued at $6.2 billion, and a little less than three months since that deal had closed.

Much has changed for everyone in the Datto, and Kaseya, ecosystems since then. Datto’s new ownership is old news for the company’s partners, and Voccola himself, with the hardest parts of a massive post-purchase integration process behind him, is visibly more relaxed.

“This last year has been a really, really interesting year. I personally, professionally was challenged like I’ve never been,” said Voccola during a Tuesday keynote address at DattoCon 2023. “It’s been a really, really interesting journey, and I think that the first year of this journey has been pretty successful.”

This year’s event, held in Kaseya’s hometown of Miami, is now officially known as Kaseya DattoCon. It concluded Wednesday with a party at the Kaseya Center, the downtown arena that was re-named through 2040 as part of a $117 million deal finalized this April. The conference, which drew some 3,500 attendees, about 50% more than last year’s show, was something of a late milestone in that journey Voccola alluded to in his opening day presentation.

“For all intents and purposes, the integration is complete,” he said in a conversation with ChannelPro. “We’re one company.”

The “all intents and purposes” part of that statement is an important caveat though, Voccola emphasizes. A job as big as onboarding a company the size of Datto isn’t really finished until one plus one equals four, he says. “And right now, I think we’re one plus one equals three or three and a half.”

Among the nearly but not quite finished work remaining is creating a single, seamless invoicing process for both Kaseya and Datto solutions. Voccola was quick to admit that process didn’t go perfectly during his keynote.

“About 8% of our partners experienced issues around billing, things that seem obvious but got through, and that’s on us. There’s no excuse,” he said.

Only about 2% of partners are still having problems, Voccola continued, a figure that should be down to 1% by the end of this month. That’s around normal for a large software company like Kaseya, he added. The time it took to reach normal, however, is nothing to be proud of.

“I’ll be very candid, we dropped the ball here,” Voccola told DattoCon attendees. “This was a mess up on our part and I want to apologize to the group that’s been affected by it, because the last thing we want to do is break things.”

That said, he asserted, Kaseya has gotten a lot more right in the last year than wrong and Datto partners are better off than before the acquisition. The company has hired over 300 new engineers, for example.

“We put a tremendous amount of additional fingers on keys,” Voccola says, resulting in “hundreds and hundreds and hundreds of new, real, meaningful integrations” across the Kaseya and Datto portfolios.

The Cooper Intelligence Engine, an AI-powered service launched some two years ago that points users to underutilized product functionality, now supports all of Datto’s products. The more powerful Cooper Bots that Kaseya announced this week will soon automate Datto’s solutions alongside Kaseya’s.

Pricing on Datto subscriptions is down an average of 15% as well, says Voccola, and even more when you compare how Kaseya changed Datto’s rates in the past year to how other companies changed theirs. “Relative to the industry,” he insists, “every single product has been substantially reduced in price because we didn’t raise prices, and the average software vendor raised prices nine, ten percent.”

As he promised would be the case shortly after word of the Datto deal first broke, Voccola adds, Kaseya has “Datto-ified” itself in important ways. Fully 85% of the leaders atop Kaseya’s MSP community team came from Datto, for example, as did about 47% of the combined company’s product and R&D leaders and 31% of its top executives.

Kaseya has embraced and invested in Datto’s partner program, which had no Kaseya equivalent before the acquisition, as well. Datto spent money on MDF previously and got good results, Voccola notes, but lacked a structured program. Kaseya introduced one and increased payouts by some 400%.

“We said, ‘this is working. Juice it. Put it on steroids. Give it lots of money and lots more resources,'” he explains.

Privately, some partners at this week’s conference and elsewhere express that Datto’s legendary support has suffered in the prior year. Voccola, for his part, insists that’s news to him.

“Not hearing it,” he says. “All we did was add more resources into the existing support.” Statistics like mean time to resolution, first call resolution, and support customer satisfaction are all marginally up in fact, he adds.

“They’re not exponentially better yet. I’m very happy with the fact that they’re slightly better considering we just went through a fairly large acquisition and integration,” says Voccola, who emphasizes that he’s not dismissive of partners who disagree.

“This is really important,” he says. “When a partner says, ‘my support experience didn’t meet my expectations,’ that’s a huge problem for our company and we take it really seriously.”

It’s just one area where there’s room to improve too, Voccola observes. “We always can get better,” he says. “Any CEO of a software company, any CEO of an MSP, everyone will say ‘no, we don’t have everything perfect.'” Kaseya is no different.

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