Today’s shocking revelation that private investment firm Vista Equity Partners has acquired Datto Inc. and merged it with Autotask Corp. to form a managed services behemoth with a sprawling product portfolio has shaken up the SMB channel. Here’s what some of the top names in the MSP market have to say about the epic deal.
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Fred Voccola (pictured), who is CEO of Kaseya Ltd., an IT management software maker with headquarters in New York and Miami, believes the giant merger will ultimately benefit everyone by motivating companies like his to up their game. Nor should the forthcoming change of management concern users of Autotask software, he adds.
“I think that Datto is a good company,” Voccola says. “If I was an Autotask customer, I wouldn’t be shaking in my boots.”
Still, he continues, there are always risks in a situation like this. Vista Equity Partners undoubtedly used a substantial amount of debt to fund the Datto acquisition, and the pressure to pay its lenders back may tempt it to cut corners.
“When you have a lot of debt you have to generate cash flow to pay the debt off,” Voccola notes. “You have to be careful that costs don’t get cut too much.”
The people who should really worry about today’s big story in Voccola’s estimation, though, are software companies that offer stand-alone, single-category products. The Datto-Autotask merger only reinforces what Voccola has long believed: in the managed services space, the future belongs to vendors with an integrated suite of solutions.
“MSPs have to offer what the customer wants, and the provider who can offer more of them in a platform will win,” says Voccola, who has used acquisitions of companies like PSA vendor Vorex and cloud management vendor Unigma to steer his company into new markets in the past. “I’d be very concerned if I was an independent software provider selling software into the MSP space right now.”
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