ConnectWise CEO: We're On the Acquisition TrailConnectWise CEO: We're On the Acquisition Trail
ConnectWise CEO Arnie Bellini is exploring the software market for potential investments and acquisitions. The Modern Office Suite, featuring ConnectWise, LabTech and Quosal, will most certainly expand.
July 8, 2013
ConnectWise CEO Arnie Bellini says his software company remains in acquisition mode. Among the key goals: Continuing to expand the Modern Office suite — including ConnectWise, LabTech and Quosal — with more business and technology management capabilities. Potential moves, acquisitions or investments could surface on or before the IT Nation Conference (Nov. 13-15, Orlando, Fla.).
The key takeaway: While some MSP-centric companies are selling (recent examples: Kaseya sold to Insight; Level Platforms sold to AVG; N-able sold to SolarWinds), ConnectWise remains in buying and investment mode. “We’re very excited for all the founders who have sold in the past few weeks and we wish them the best,” Bellini told MSPmentor. “But as for us, we’ll continue to climb the mountain. We have more work to do. We’re in acquisition mode. We’re a buyer in this market.”
To paint his strategic picture, Bellini points to the Modern Office suite’s momentum and compares it to Microsoft Office.
While Microsoft Office has Word, Excel and PowerPoint, the Modern Office has ConnectWise, LabTech and Quosal for business management, technology management and sales proposal engagement.
But don’t forget, Bellini adds, Microsoft Office has additional pieces like OneNote. Similarly, the Modern Office suite will gain more and more capabilities — either through home-grown software development, investments or acquisitions.
Rapid Growth, More Coming?
ConnectWise Capital, launched in January 2010, is a $20 million investment fund designed to “incubate innovation” in the IT channel. So far, ConnectWise Capital has invested in LabTech, Quosal and CharTec. The results have been impressive:
ConnectWise had about 1,700 partners around four years ago. Today, that figure is 5,500 partners.
LabTech had roughly 180 partners three years ago. Today, the figure is 3,500 partners.
Quosal had 400 partners two years ago. Now, it’s 1,600 partners.
CharTec has emerged as a key training, BDR and HaaS provider in the MSP market. And there are rumors that a file sharing partnership is coming soon…
“The growth has been exciting,” said VP of Worldwide Sales Adam Slutskin. “We’re adding almost 250 partners a month — and it isn’t slowing down.”
Slutskin, LabTech CEO Matt Nachtrab and additional executives sat down with me during the Automation Nation conference in June. Nachtrab said LabTech revenues grew 59 percent in Q1 2013 vs. Q1 2012. But much like Bellini at ConnectWise, Nachtrab indicated that LabTech wanted to continue climbing the mountain of growth rather than seeking any near-term exit. (More on my meeting with Nachtrab soon.)
So where will growth come from? Certainly, ConnectWise and its sister companies can grow organically both in North America and abroad. But technology partnerships and potential investments will also be important. “We are seeing a lot of activity because of our capital arm,” said Bellini. ” A lot of great ideas are coming to us and wanting to partner or become part of the Modern Office. We will be capitalizing on plugging any remaining holes in Modern Office.”
At the same time, Bellini is betting that rivals will gradually drift to an enterprise market focus — taking their eye off the MSP, VAR and IT service provider industry. “We’re going to keep serving the community we know and love: The IT Nation. I believe the others [acquired MSP software rivals] will migrate toward enterprise customers.”
Where will ConnectWise potentially invest? Keep an eye on Director of Strategy Gerwai Todd. When ConnectWise Capital examines potential investments or acquisition targets, Todd is typically involved in the research and due diligence.
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