Private Equity: Zenith RMM and N-able Deals Are Different

Both N-able Technologies and Zenith RMM have embraced private equity funding in the past week or so. At first glance, the deals are similar: Two private equity firms are pumping money into managed services software companies. Plus, N-able and Zenith RMM compete with one another. But take a closer look and I think you'll see the private equity approaches are quite different.

A quick recap:

Zenith Infotech has spun off Zenith RMM as a separate company. Zenith Infotech retains its cloud computing strategy. While Zenith RMM focuses on remote monitoring and management software, as well as NOC (network operations center) services for MSPs. The Zenith RMM spin-off is backed by both Zenith Infotech and Summit Partners, a private equity firm. I don't have details about ownership percentages.

Meanwhile, N-able Technologies has received a minority investment from Accel-KKR. N-able plans to use the private equity investment to accelerate its international growth and may even pursue some acquisitions. It sounds like N-able has already made a small acquisition, with a potential related product expected to be announced at the N-able Partner Summit (Oct. 12-14, Scottsdale, Ariz.). I don't know exactly how much money Accel-KKR pumped into N-able, but I do know it's Accel-KKR's funding represents a minority investment in N-able.

Competing In Different Ways

Bottom line: N-able Technologies and Zenith RMM compete in the managed services software market. But their paths forward are different...

At N-able, the existing management team -- led by CEO Gavin Garbutt -- remains in place. Accel-KKR gains two seats on the N-able board. But overall, it sounds like N-able's business strategy remains unchanged. The idea is to empower MSPs with freemium and paid software to achieve 100 percent coverage in the SMB market.  Accel-KKR has bet its private equity money on N-able's existing management and its existing business strategy. The idea is to accelerate that strategy. The challenge: N-able has to execute on its vision, so the vision has to be right.

At Zenith RMM, there's a new executive management team in place -- led by new CEO Michael George. It sounds like the R&D team remains in place. Generally speaking, I think George and Summit Partners are calling the shots at Zenith RMM. Some of the the most knowledgeable RMM channel experts, such as Senior VP Maurice Saluan, remain with Zenith Infotech.

Is the N-able approach better than the Zenith RMM approach? Actually, I'm not saying that at all. Both strategies can work.
  • The consistent leadership and new funding could help N-able to accelerate its business.
  • The new leadership and new funding cloud help Zenith RMM to accelerate its business.
Like I said: Different deals. We'll be watching to see how each plays out.
TAGS: Financing
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