Kaseya CEO: We Have $1B Opportunity Amid Zyrion Buy

As Kaseya buys Zyrion, CEO Yogesh Gupta sees a $1 billion opportunity to serve MSPs and mid-market business customers. The MSPmentor interview explains why.

Joe Panettieri, Former Editorial Director

July 9, 2013

4 Min Read
Kaseya CEO: We Have $1B Opportunity Amid Zyrion Buy

As Kaseya buys Zyrion, CEO Yogesh Gupta predicts the combined company has a $1 billion opportunity in a $10 billion market segment — IT service management software for MSPs and midmarket businesses. Can a next-generation Kaseya, backed by Insight Venture Partners, truly grow to that size?

Insight set the M&A wheels in motion in late 2012, exploring the potential Kaseya buyout while also interviewing Gupta — a CA Technologies veteran — for potential executive leadership opportunities. Insight ultimately acquired Kaseya in June 2013, and then funded Kaseya’s buyout of Zyrion this week.

Financial terms for the deals were not disclosed. But this much is known: Insight still has a war chest to make more acquisitions if Kaseya spots tuck-in opportunities, Gupta said during a call with MSPmentor this evening.

“Part of my strategy all along is to build out the [Kaseya] portfolio,” said Gupta. “We want to address a broader set of customer needs for MSPs and enterprises. We [Kaseya and Zyrion] have common customers who love both solutions. And we’ll also win new customers through the two offerings.”

Over time, Kaseya and Zyrion’s software platform will converge together — giving MSPs a single pane of glass to manage physical devices while also monitoring and managing virtual assets and applications across private, hybrid and public cloud environments, he predicted. “Hopefully we’ll get there sooner rather than later,” Gupta added.

Still, there’s plenty of development work to be done. Kaseya is available on-premises or in the cloud. Zyrion does not yet have its own cloud — though MSPs can host the software. “Zyrion, as a smaller company, did not want to take on the additional overhead of hosting their own offering. But we’re a huge believer in the cloud. We will go there with the Zyrion offering.”

More Deals Coming?

Gupta stopped short of predicting that Kaseya will buy more companies. But he offered plenty of hints that if the right deals surface, Kaseya will remain in buying mode. “This isn’t the end of the story for us. This isn’t just about what we have in the bank today. Insight has deep pockets. We’ll grow organically. And if we find the right assets, we’ll also bring them in-house.”

Among the potential targets I keep asking about: GFI Software, since Kaseya’s parent (Insight) also has an investment in that company. “If [Kaseya and GFI] think doing something together is in the best interest of both companies then we’d do something,” said Gupta. “Insight wants all of its portiflio companies to do well. It’s like having two kids. You want both to do well.” From my two conversations with Gupta, it does not sound like a Kaseya-GFI deal is brewing (but I’ll keep asking each time I speak with Gupta).

The Big Four, Revisited?

Gupta ultimately wants Kaseya to build the modern-day IT management platform for mid-market customers and MSPs. The company does not plan to pursue Global 2000 customers. “We’ll win some of those but we’re much more focused on business that have thousands of employees — not hundreds of thousands. And we’re focused on MSPs serving SMB customers and the mid-market.

Much in the way that BMC, CA Technologies, HP and IBM dominated IT service management during the client-server era, Gupta sees the opportunity for Kaseya to address reliability and availability at a reasonable cost for the hybrid cloud era. “That’s my goal,” he said. “I think Kaseya can be that platform.”

In fact, Gupta adds: “I have been telling the Kaseya team that we have the opportunity to be a $1 billion company because this is a $10 billion-plus market opportunity — IT management for MSPs and the mid-market. The number of devices is growing exponentially because of BYOD and hybrid cloud. Everyone needs those environments managed.”

Familiar Face

Even though Gupta is somewhat new to Kaseya, he has some familiar faces on the executive team. Chief Marketing Officer Bob Davis worked with Gupta back at CA Technologies. Insight’s buyout of Kaseya and Gupta’s shift into the company’s CEO seat “was the perfect event at the perfect time with the perfect leader,” said Davis.

Will MSPs agree? We’ll keep watching.

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About the Author(s)

Joe Panettieri

Former Editorial Director, Nine Lives Media, a division of Penton Media

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