Kaseya Clarifies Channel Strategy (Again)
The old rumor is back. Some skeptics think Kaseya is taking more and more of its business direct. Kaseya CEO Gerald Blackie has written a blog to combat the rumor. In the piece, Blackie describes where Kaseya works with partners and where Kaseya expects to work directly with customers. So what’s the strategy? Here’s some perspective.
First, let’s rewind a bit. Back in October 2008, some MSPs and rivals alleged that Kaseya was going direct. At the time, Blackie dismissed the rumors and described an indirect and direct sales strategy, which I summed up in the following way at the time:
- For end-customer environments with 100 or fewer seats, that’s an ideal opportunity for Kaseya’s MSP partners.
- For end-customer environments with 100 or more seats, MSPs are welcome to compete in that market but they may run into Kaseya’s direct sales force from time to time.
Current Chatter
Now, fast forward to the present. I don’t think much has changed — except for product names.
When Kaseya 2 — a new management framework — launched earlier this month, the platform had multiple SaaS and on-premise components. Some rivals and a few MSPs think the Kaseya 2 platform is designed to be sold direct. Aware of the rumors, Blackie has written a pretty lengthy blog vowing Kaseya’s continued commitment to MSPs.
When you boil down the blog, though, I think the four following bullet points — taken directly from Blackie — sum up Kaseya’s partner strategy:
- SOHO – generally not a candidate for MSP services but need concise IT tools for concise IT tasks
- Small to lower end of Medium-sized Business – reached through the Kaseya MSP partner network
- Large / Medium-sized Business – generally (there are exceptions) not interested in obtaining managed services from outside the company
- Enterprise and Public Sector – generally have all the expertise needed in-house to manage all IT requirements
Translation: Kaseya sees the small and lower-end of the midsize markets as prime MSP opportunities. Moving into the larger midmarket, enterprise and public sectors, Kaseya seems to be saying it will sell direct to corporate accounts.
So, essentially, I think Kaseya’s strategy remains unchanged. Is that fair? Unfair? MSPs will need to decide, based on which markets they serve.
Remember: Kaseya views itself as a modern day ERP solution for systems management. And Kaseya’s management team comes from an ERP background. Now, consider ERP strategies over at Oracle and SAP, and you’ll find direct sales into large corporate accounts, and partner sales into the small and lower midsize markets. I could be wrong, but I believe quite a few systems management companies (CA, BMC, Hewlett-Packard, IBM Tivoli, Nimsoft) are using that direct and indirect sales approach.
Pure Channel Approaches
Meanwhile, plenty of remote monitoring and management companies are preaching pure channel sales. Two examples involve Level Platforms and N-able. But even here, there are subtle nuances worth noting.
Level Platforms, for instance, views its tools as MSP-centric — designed purely for service providers that want to remotely manage customer and cloud systems. N-able, in stark contrast, sees its tools as both MSP- and customer-centric — designed for use by MSPs or by an IT administrator within the end-customer market. That’s why N-able launched a mid-market channel program — to help MSPs resell N-able’s software into mid-market end-customer accounts.
So what’s the bottom line? As you evaluate tools ask about each company’s partner strategy. Some software providers have pure channel strategies — you’ll never run into their sales teams in a customer account. Other software providers, such as Kaseya, do sell direct into larger accounts.
Now that I am on the other side of the service provider fence, working as a consultant and sometimes fractional CIO/CTO, Kaseya’s SMB and Enterprise Editions are on my radar.
If I were forced to purchase Managed Services to get at the Kaseya solution it would be a deal breaker. A distributor model (through CDW, etc) would dilute opportunity and the eval process, so I can understand why Kaseya is doing this.
I don’t think an MSP should be concerned at all. There isn’t a scenario where Kaseya is going to steal a potential Managed Services customer because they are just selling the tool. In the phone system world we often lose the bigger opportunities to our vendor.
In addition, in the phone system world whenever I had an opportunity that exceeded $500k it was quickly snatched up by the manufacturer as an “enterprise” sale. We got a very small commission and we were kicked out of the sales process completely.
If I were an MSP I would be far more concerned with Dell Managed Services, which I am currently evaluating for another client.
Vendor’s like Kaseya have been very loyal to the MSP world, hosting high-end catered events and weekly webinars that actually provide useful (and free) info for startups and established service providers alike.
Man I really wish I cold edit my own posts. Sorry for some redundant sentances. 🙂
Andy: No need to apologize for redundant sentences. I appreciate you sharing your thoughts. And you raise an interesting point about Dell Managed Services. I expect to speak with Dell after the company announces earnings on Feb. 18.
-jp
Dear All MSP Mentor readers,
Like when my wife worked at a large Cinema Distribution company, if there was a rumour it was true, Like Blackie said:
“•For end-customer environments with 100 or more seats, MSPs are welcome to compete in that market but they may run into Kasey’s direct sales force from time to time”
Well I must give credit to KASEYA for a stunning product, we have exceeded 20% Automation in our ITIL/ISO20000 Based MSP Offering, this is by scripting mundane repetitive check listing activities and hence saving 20% of all time billed against customers.
Now with that said we have invested 100,000.00 in salary and licensing to get to this place, our target market is 15 User clients to 250 user client, and we are building a hosted solution and are busy with some massive projects. Now this is when it starts getting interesting.
as Blackie said, 100 users + is direct sales, well already there we are competing with the supplier, knowing that we have Outstanding IP that gives us a fantastic edge in custom scripting and work load automation this doesn’t scare me, but when we have a target that can bring on 10000 agents in one bang then obviously KASEYA opens their ears as we register these clients/Leeds with KASEYA and according to Blackie this is free for all.
As far as the competition is concerned (Level Platforms’ Managed workplace) I spent in excess of two years trying to manage 5000 end points with their Agent-Less solution (this was the biggest waste of my time and my colleagues) and they too have now a SaaS offering.
I guess that the advantage that we have is that we operate in a 3rd world country and this makes us semi invisible to the KASEYA volume sales engine.
Andreas: One point of clarification – the words you quote are mine, not Blackie’s. They were my interpretation of Kaseya’s strategy.
-jp
MSP’s don’t need to be concerned with Kaseya. They still aren’t providing the services that make up Managed Services (vCIO, Network Administration, Best Practices, Reactive Support.) Nothing of what they are going to do is going to overlap with the vast majority of MSPs. Even the MSPs that play in the larger space still have a great value proposition when a company is looking to control it’s IT costs. Kaseya software only allows you to do so much; you still need expertise and processes behind that software to make it go.
Here’s my lame analogy: there are still carpenters even though anyone can go to Home Depot and buy the tools. Kaseya is a tool and you still need the people and process to utilize that tool. If a company has those two (rare in the lt; 100 user market) then they can get Kaseya with a lower initial investment.
It#039;s not new; Zenith has been available to anyone for years now. And if you include automation tools for corporate environments like ScriptLogic, individual companies have been able to do automation much longer than MSPs have been able to provide it across disparate networks.
In conclusion, the sky is not falling in regards to Kaseya#039;s channel strategy…
Bob Penland
CTO
TruMethods, LLC.
JP…from the outside looking in this is my 2 cents Canadian btw
Why wouldn’t Kaseya go direct in some opportunities? If I was in charge of corporate strategy that had a choice of going direct vs. Channel, I just may look at the direct model, especially for larger opportunities.
Sure small business is pretty safe, no company can cover the breadth of that space.
I have some good buddies who are CIO’s at some pretty big firms and they want to deal with a company like Kaseya directly, no middle man, no extra baggage…that is just the reality of the world especially in the enterprise space.
I also think that is where the money is. Less amount of deals but larger pay offs. I have a friend who once shared a secret with me. He told me he put the same amount of effort on a 7-figure deal as I put in on a $25,000 deal. Kinda eye opening.
I just have to look in the Oil and Gas industry here in Calgary to see Microsoft placing professionals engineers, consultants and sales professionals selling directly to large energy firms, sometime with an enterprise partner and sometimes not.
I think the small MSPs are safe…sub 1000 seats firms…I think you are OK.
But what do I know 🙂
Stuart Crawford
Once an IT Guy
Calgary, AB