Datto Positions Itself at the Epicenter of MSP World

The Doyle Report: Datto Positions Itself at the Epicenter of MSP World

Since founding Datto almost 10 years ago to this day, CEO Austin McChord has pursed basic problems that others have otherwise overlooked or ignored.

Is Datto the most important technology vendor for managed service providers?

You might think so if you were in Denver this week attending DattoCon 17, Datto’s largest and most ambitious partner event ever. Here, the Norwalk, Conn.-based company showcased some disruptive innovations, outlined broad corporate initiatives and thanked partners for their support. (To show them its appreciation, Datto gave each partner a new Datto Access Point 60 with free service for life.)

More broadly though, Datto continued to position itself as an ever more important technology supplier to managed services providers. It does so by entering adjacent markets, developing disruptive innovations and providing channel companies with lucrative business opportunities.

This week, there are more than 1,000 MSPs on hand in Denver. They have come from all over the word and represent many different types of service provider organizations. The woman next to me at today’s keynote? She works for a company that resells Datto gear and services to credit unions, which use the company’s technology to backup their ATMs.

As he does every year at DattoCon, Datto founder and CEO Austin McChord opened the event with an update on recent company milestones and a glimpse into new endeavors. Today, McChord said, Datto does business in nearly 200 countries. It boasts nine data centers worldwide, 6,400 partners and more than 150,000 active deployments globally.

When I asked afterwards in a 1:1 interview about the company’s role at the center of the MSP universe, McChord initially bristled at the thought of becoming the “indispensible” company in the channel. But after mulling the idea, he warmed to it. He likened Datto to an “agitator” that likes to enter mature markets that are crowded and primed for disruption. At one point he compared Datto to Amazon, which is disrupting markets with new ideas and unrivaled agility. Amazon beat Apple to market with a smart speaker by three years, McChord noted.

“The idea that we can be the agitator that improves stuff? That’s what gets me excited. That’s what we shoot for. If it so happens that we become indispensible, so be it. But that’s not how we think about the problems that we are trying to solve,” McChord said.

Whether by design or accident though, companies aligned with Datto say its combination of backup and recovery technology, ransomware protection, managed networking services, SaaS backup and DRaaS capabilities increasingly put the company at the epicenter of the MSP world. Not Microsoft. Not Google. Not Cisco, VMware, HPE, Lenovo or anyone else. Datto.


Datto CEO Austin McChord

“When I sat back and looked at all the things that Datto is already doing and what they introduced today, I wondered to myself ‘what MSP wouldn’t want to be doing business with Datto?’” said Tony Francisco, CEO at CloudPlus, a click-to-provision hosted services company that serves many Datto MSPs.

Since founding Datto almost 10 years ago to this day, McChord has pursed basic problems that others have otherwise overlooked or ignored. The approach led Datto to develop screenshot verification, hybrid virtualization, time-based retention, ZFS deduplication and encryption, Macintosh backup, all-flash BDR and more.

“All of these have become the new standards. And we’re the ones that pioneered them and pushed them forward,” he says.

Datto again is trying to stir or “agitate” the market with a “moon shot” that could radically change how small businesses buy, deploy and manage everyday technologies. Unveiled today, “Datto Desktops” is a complete Virtual Desktop Infrastructure (VDI) solution with thin client technology and a desktop management portal. McChord says this technology effectively eliminates all of the customer equipment that an MSP has to service.

Datto showed another clever product that had MSPs talking afterwards. It is a new powerstrip with built-in Wi-Fi capability that can be remotely managed. With a Datto Managed Power device installed at a customer setting, an MSP can avoid jumping into a van and driving to a destination for a basic reboot. MSPs I spoke with afterwards said the simple device would add to their profitability.

Also new this week: new protection for SaaS apps and data. Available now, the protection now covers Office 365 users. In addition, Datto showcased improved SIRIS 3 software, which includes a new “Fast Failback” feature that allows MSPs to spin-up a virtual machine (VM) with a rescue agent—quickly.

For a complete breakdown of products unveiled today, look here.

As for what comes next, McChord says he is energized by what Datto could do with the Internet of Things (IoT). (Think about managing IoT products with a Datto Managed Power strip, for example.) He is also looking at new ways to recombine existing Datto technology to create new deliverables.

“A lot of our new stuff is actually powered by the work that we did in other places. When we showed off our VDI thing, every single piece of that technology stack is already in SIRIS… When you look at the things that we are doing that are so disruptive, many of them actually come from ideas that we are already doing,” said McChord.

Whether Datto is a part of your world or not, expect more things to come from it soon.

Could this include an initial public offering (IPO)? I asked McChord specifically. He declined to provide a definitive answer. While the timing for an IPO could be right—Datto is already profitable and the broad markets are up—McChord does not appear to be looking to cash out anytime soon. During our interview, he showed off his Withings smartwatch, which cost all of $129. He wears it instead of his Apple Watch because he likes the looks and the battery life.

If you're wondering about next year, Datto announced that DattoCon 18 will take place June 18-20, 2018, in Austin, Texas, where our own Channel Partners Evolution event will be held Sept. 25-28 of this year.

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