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DattoCon18: Ten MSP Questions for Datto

Datto Founder Austin McChord
Datto CEO Austin McChord

As DattoCon18 kicks off this week, it's safe to expect a "State of the Datto-Autotask" merger from CEO Austin McChord. But that's not all. Here are 10 updates, questions and trends MSPs should explore during the conference in Austin, Texas.

First a little background for those outside of the MSP market: Datto offers a range of data protection, backup, disaster recovery, networking, professional services automation (PSA), remote monitoring and management (RMM) and file sharing solutions to MSPs in the SMB sector. Key entrenched rivals include ConnectWise, Continuum, Kaseya and SolarWinds MSP, among others.

Roughly 1,600 MSPs or more are on hand for DattoCon. Now, the key questions and themes for MSPs to explore:

10. Datto-Autotask -- Don't Call It a Merger: Sure, Vista Equity Partners essentially merged Datto and Autotask in December 2017. But in reality, the private equity-backed deal is better described as Datto acquiring Autotask (at least in my opinion). After all, Datto CEO Austin McChord runs the combined company and sets the tone for its products, services and business strategy. Autotask CEO Mark Cattini essentially exited the day the deal surfaced, and he now runs Click Software.

Calling the deal an "acquisition" rather than a "merger" isn't a knock on the former Autotask. Instead, it's just plain smart (again, in my opinion). As I learned when SynOptics and WellFleet announced a "merger of equals" way back in 1994: There's no such thing as a merger of equals. Instead, one leader must lead. And one culture must emerge. Rapidly. For those who don't remember: SynOptics and WellFleet were so busy trying to coordinate two management teams on two U.S. coasts, that they got crushed by Cisco Systems. Clearly, Datto won't be making the same mistakes in its M&A world...

LiveAction CEO Brooks Borcherding

9. Executive Team: As with any M&A deal, some executives exit during or shorty after the transaction. Former Datto Chief Revenue Officer Brooks Borcherding, for instance, exited to become CEO of LiveAction -- a fast-growing network performance monitoring company focused on high-end service providers. And in a somewhat surprising move, Autotask's Pat Burns decided to exit earlier this year (Senior VP of Engineering Adam Stewart took on his responsibilities). Fast forward to present day: How is McChord feeling about Datto's executive suite and leadership team -- especially as the company strives to accelerate synergies and product integrations across the Datto and Autotask product lines? We'll dig for answers when we sit down with him.

8. Sale Team Synergies: I'm curious to learn if or how the Datto and Autotask sales teams have reorganized -- perhaps to give partners one point of contact across the company's various product lines. We'll find the latest organization updates for you.

7. Datto Desktop as a Service (DaaS): Datto hinted last year that it was exploring a potential desktop as a service (DaaS) or workspace as a service (WaaS) solution. I think it was a VDI (virtual desktop integration) solution tentatively called Datto Desktops. Still, DaaS and WaaS has been a tricky sell in the MSP market, mostly because of pricing/business model and intellectual property ownership challenges. Will Datto launch a commercial product or service in the market? We'll ask McChord for updates.

LinkedIn: Datto Networking VP John Tippett

6. Networking Strategy: Datto acquired OpenMesh networking in early 2017. The idea: Disrupt the SMB networking market near-term, and build a base to go head-on against Cisco Meraki over the long haul. To accelerate the effort, Datto hired John Tippett in May 2017. Fast forward to present day: Tippett has been onboard for about a year. So how is the networking push working out? We'll get answers directly from him.

5. Security Strategy: The Datto Networking Appliance (DNA) includes some firewall and unified threat management (UTM) capabilities. Also, Datto's business continuity services and associated appliances are critically important to MSP security strategies. And Autotask preaches endpoint security with its RMM tools. But I don't believe the overall company has announced a formalized security strategy -- a type of "bet the company" move to help MSPs deliver end-to-end security and protection. I wonder if we'll see it here.

4. Cloud Services Strategy: A growing number of backup companies offer their software via Amazon Web Services, Microsoft Azure, Google Cloud Platform and some other public clouds. AWS, Azure and Google are expected to cut their storage prices every few months until the end of time. Datto, meanwhile, continues to link its appliances to the company's home-grown cloud platform. Can that business strategy remain strong and profitable amid public cloud pricing pressures? We'll ask McChord for some thoughts.

3. Pricing Strategy: Building on item 4 above, Datto announced an overall business continuity pricing strategy back in January 2016. Fast forward to present day: Is that business model still working, and what type of pricing benefits can partners expect as they potentially adopt the broader portfolio of Datto offerings?

Rob Rae, VP of Business Development, Datto

2. Global Strategy: Autotask localized its software for multiple regions back around 2011 or so. The company also build a strong base of distributors and MSPs worldwide. Datto certainly has global momentum as well. But we'll be poking around to see if Datto plans to leverage some of Autotask's early localization work to achieve even greater global scale. We'll ask VP of Business Development Rob Rae for some thoughts on the topic.

1. Coopetition: Competition continues to intensify across the MSP technology market. And yet, there's also a growing need for cooperation -- especially since thousands of MSPs have mixed vendor environments. Those market realities create a need for "coopetition" -- a term coined by the late Novell CEO Ray Noorda to describe firms that compete and cooperate. McChord has vowed to ensure DattoCon remains open to all vendors -- even if they compete with his company. He also has confirmed plans to speak on a panel with many of his industry rivals later this year at IT Glue's GlueCon 2018 conference in September. In the meantime, what practical examples can McChord offer for Datto's continued focus on rival relationships and cross-product integrations? We'll ask for updates here.

Bonus: What Did We Miss? Got a question for Datto, McChord, the executive team and/or attendees at DattoCon? Email me your thoughts ([email protected]) and I'll keep them in mind as we navigate meetings here at the conference.

Joe Panettieri

Joe Panettieri is co-founder & editorial director of MSSP Alert and ChannelE2E, the two leading news & analysis sites for managed service providers in the cybersecurity market.