Kaseya Wants Your Love

It would be a mistake to call Kaseya unpopular. You don’t get to be as big as the company is or achieve the roughly 94 percent renewal rates it claims to have by being unpopular.

On the other hand, though all its major competitors have critics too, Kaseya sure appears to have more—and more vocal—haters out there with angrier stories to tell about poor support, broken billing, and aggressive price hikes.

Fred Voccola (pictured), Kaseya’s CEO, knows it and knows where it comes from too.

“I’ll be the first one to admit, we make a lot of mistakes and it sucks,” he said during his Tuesday morning keynote this week at the company’s Kaseya Connect Global conference in Las Vegas. “When you see a Reddit post about a stupid issue, a bug in our product or a billing thing that we did that was stupid, our support team isn’t getting back in time, it is so frustrating.”

Kaseya has 5,000 employees, he continued. “I promise you every one of them works their ass off to try to deliver the right solutions. But we mess up. We’re human.”

The string of acquisitions the vendor has been making since 2018—though absolutely essential to realizing the audacious vision Voccola’s been pursuing since taking over at Kaseya in 2015, a vision that came fully into focus with this week’s launch of Kaseya 365—hasn’t helped.

“Everything changes at Kaseya every six months,” says Gary Pica, president of Kaseya unit TruMethods, an MSP consultancy. “That’s not an easy thing to do. And you will break some eggs.”

With K365 now in market though, Voccola’s ambitions have shifted, and while they begin with selling a lot of software at market disrupting prices, they don’t end there. They don’t even end with cleaning up those broken eggs.  

He wants your love.

“Our goal is for every customer to love Kaseya,” Voccola told me this week. “Not because they’re friends with the people they work with and they go to the bar drinking. They love it because Kaseya makes them incredibly successful and is incredibly easy to do business with.”

And in case I missed the point, he returned to it later in the conversation. “We want this industry to see us as someone to love and respect,” Voccola said. “We’re going to put our money where our mouth is and make sure people know that we are here to make sure MSPs powered by Kaseya are incredibly successful from now for the next decade.”

The Partner First Pledge Kaseya unveiled this week is a big down payment on that goal. It’s no coincidence either, that Voccola unveiled it during his keynote immediately before announcing Kaseya 365. “P1P,” as Kaseya refers to the pledge internally, is an utterly strategic counterpart to Kaseya 365 that will go a long way to determining how far and how fast the new platform takes off.

“It’s really important to have both of them,” Pica says.

Entrusting Kaseya 365 to take good care of your management, security, and backup necessarily entails trusting Kaseya itself. “It’s a business decision first, then a technical decision,” Pica says. P1P aims to make that decision easier for wary MSPs by reassuring them about all the things Kaseya knew they’d have doubts about.

Beginning, of course, with the seemingly too-good-to-be-true price. Within minutes of the K365 news breaking, an MSP messaged me his prediction that after consolidating the market with loss leader rates, Kaseya would start raising prices dramatically. Not a crazy concern either, as Kaseya is owned by private equity and following market saturation with price hikes is kind of a classic PE play.

Hence P1P’s “price lock guarantee,” which limits price bumps at renewal time to inflation (as measured by the Consumer Price Index) plus 5%. Note the words “at renewal time” too.

“For customers that are on multi-year contracts, as most of them are, there’s no yearly increase,” Voccola notes. “We want to make sure Kaseya partners know we are not going to screw them by raising our prices once they jump onto our platform and go all in with Kaseya.”

Most P1P components have less to do with K365 than with persuading MSPs more generally that Kaseya takes the word “partner” seriously. Examples include the new “catastrophic client loss protection” program, which lets partners reduce license counts after losing a customer responsible for 20% or more of their Kaseya spend. “We pledge not only to share in the benefits of our partnership, but to share in the risk that our partners face,” Voccola says.

Similarly, Kaseya’s FLEXSpend program, which was limited to backup solutions when it debuted last year, now lets MSPs reallocate spending from any Kaseya product to any other as needed. According to Voccola, FLEXSpend for everything has been the company’s policy informally all along.

“We didn’t have a proper name for it, and when there’s not a proper name for something and it’s not formalized, 57,000 people aren’t aware of it,” he says. “Only the 700 people who have asked for it are aware of it.”

Additional P1P planks directly address some of the biggest sources of partner discontent. Month-to-month contracts for Datto BCDR appliances? They’re back. The pricing penalty Kaseya has long imposed on buyers of single-year contracts? Still there, but smaller. And one-year licensing options are available for everything Kaseya sells.

“By the way, they always have been,” Voccola says. “We just feel the need to re-express it very vocally, very directly because that message got lost in the noise.”

Much of P1P, in fact, is meant to silence what Kaseya regards as noise. And if those efforts still leave you leery about buying into K365, Pica directs your attention back to eggs. Not the ones Kaseya has broken of late but the ones it’s asking you to place in Kaseya’s basket. Sure, RMM, antivirus, EDR, backup, and the rest of Kaseya 365 are important eggs for any MSP. But you probably have a lot of others, from compliance and VoIP systems to quoting and marketing automation products.

“So it’s just some of your eggs” that you’re betting on Kaseya, Pica says. “It’s not all of the eggs.”

Thanks for reading Channelholic! Subscribe for free to receive new posts and support my work.

Is Kaseya 365 a loss leader?

That MSP I referenced before isn’t the only very smart person I know who called Kaseya 365 a loss leader this week (and see you at RSA next week, Kyle!) Indeed, it’s hard to imagine a fairly expansive platform priced as low as $1.75 per endpoint per month not being a money-loser.

Dismiss this if you wish, but Pica says Kaseya will turn a profit on every seat it ships. He’s sat in on a lot of c-suite meetings in the last few years, and has long wondered privately why a company making good margins on its products is so obsessed about cutting cost of goods sold. Now he understands.

“They’ve done it to the point where they can do this pricing all day long,” Pica says. “There’s software profit margins on [Kaseya 365]. It’s good for Kaseya, it’s good for MSPs, and mostly importantly, it’s good for SMBs.”

Ambitious yet judicious on AI

Last fall, regular readers will recall, I likened Kaseya’s growth strategy to Oracle’s in a long-ago dual for server room dominance with Microsoft. The irony of that analogy became apparent this week when I asked Voccola about the degree to which Kaseya 365 was inspired by Microsoft’s disruptive launch of Office thirty-odd years ago, and his face lit up.

“I’ve said many times that there’s one company in the world that I just have idolized my whole life and it’s Microsoft,” he said, adding that Kaseya 365 is absolutely a conscious effort to do for MSP software what Office did for productivity software.

“I’d rather copy someone than invent something new, so we’re following that playbook,” Voccola says.

Kaseya has departed from the Microsoft playbook in another area, though, and in a way that required it to invent something new. Instead of building its AI strategy on OpenAI’s GPT platform like Microsoft, or on Microsoft’s Azure-based implementation of GPT like arch-rival ConnectWise, Kaseya has created its very own large language model. It’s called the Cooper Intelligence Engine, it’s named after Voccola’s dog, and it’s probably right about the same age.

“We started down this path almost five years ago,” says Nadir Merchant (pictured), Kaseya’s general manager and CTO of IT operations products. The platform made its first public appearance nearly three years ago as the underlying foundation for Cooper Insights, a “utilization technology” designed to point out features in Kaseya products that users are paying for but not using.

Today, it powers everything AI-related in the more than 250 automations Kaseya has rolled out to date, including the 20 included in Kaseya 365 (which according to Voccola tackle 80% of the work technicians do). It will continue to be the only AI engine Kaseya uses in the future as well.

“We’re not going to do anything third party,” Merchant says. “There’s too much risk there.”

The Cooper Intelligence Engine was undoubtedly a big part of what Voccola had in mind when discussing Kaseya’s plans for AI during his keynote. “AI-driven automation has the potential to be the biggest change agent that this industry has seen, and we feel that we’re ahead of the game,” he said.

Hard to know if that’s true or not, but this much is clear: There’s a big difference between being cautious (the word I correctly used to describe Kaseya’s approach to AI last October) and being slow (a word that I incorrectly implied describes Kaseya’s pace of AI innovation).

According to Voccola in his keynote, Kaseya has invested “billions of dollars” in AI so far. Merchant adds that Kaseya has big resources beyond money going for it, including data. Lots and lots of real-world anonymized data.

“We have, I don’t know, maybe 25 million devices that we manage through our RMM on a day-to-day basis. We have tens of millions of documentations in IT Glue. We have millions of tickets that get created in our ticketing systems every day,” Merchant says. “We can use all of this data to feed our learning and to make our systems more intelligent.”

A new tool called IT Glue Copilot, officially released on Monday, is the latest example of how Kaseya plans to put its giant data pool to work. At present, the system helps technicians produce documentation like the “flexible assets” they use to summarize network information and license usage. “All that was done manually,” Merchant says. “Now we automate all of that.”

Eventually, the system will help technicians curate, locate, and govern documentation too. By October, when this year’s DattoCon event takes place in Miami, Merchant hopes to have a copilot for the company’s PSA systems in place as well to help with summarizing and triaging tickets, among other things. More such tools will follow, Merchant says, “wherever we see an opportunity to leverage the technology to deliver outcomes.”

That focus on technician outcomes is the biggest reason Kaseya isn’t rolling out AI-based features as rapidly as some of its competitors, he adds.

“Most of the time it’s a lot of hype and it doesn’t really deliver a lot of value,” Merchant says. “We’ve been a bit judicious about how we’ve adopted it and taken a very careful approach focused on how do we deliver better results to our customers, because ultimately that’s what matters to us.”


Choosing your own autonomous AI adventure

The damage AI can do, and the liability that can result, matter to Kaseya too, which is why (like N-able but unlike Atera and possibly Syncro) the company is being especially judicious about autonomous AI.

“I don’t like autonomous automations for IT and security,” Voccola says. “I just always like the ability to say, ‘start, stop.’”

That’s a personal belief though, he continues, and not one Kaseya plans to impose everywhere all the time. The company will use autonomous automation in its products, but only “in very controlled situations where there’s very low risk,” says Merchant, citing a feature that allows technicians to view documentation directly inside service tickets as an example. MSPs configure and manage that manually at present, but AI will soon do it autonomously for them. Merchant calls that a low risk, high reward use case.

“If AI makes a mistake there, it’s not changing a system. It’s not doing anything catastrophic. It’s not overwriting data,” he says.

And what if an MSP with a high tolerance for danger wants more autonomous AI in their tools and processes? Kaseya won’t exactly encourage them, but it won’t exactly stop them either. They’ll be free to use the Cooper Bots Kaseya introduced at DattoCon last year to their heart’s content in such situations.

That “will be enabled by the MSP, customized and controlled by the MSP, and there’ll be systems and guardrails around what it does and how it does it,” Merchant says.

Thread has something new for dispatchers

Thread, the service experience optimization platform we’ve written about here before, is also pursuing a middle way on autonomous AI. The system categorizes and prioritizes tickets automatically, and has a copilot-like feature based on GPT-4 that can read and chat about them. What it can’t do, and won’t any time soon, is discuss tickets all by its lonesome with end users.

“We’ll write a response for you, and you copy and paste it,” says Bobby Jacobs (pictured left), the company’s head of growth. “We don’t think AI is at a point to chat with your customers now.”

That said, there’s a lot more it can do than it is at present, and Thread has some of that functionality on its roadmap. Examples Jacobs is willing to discuss include reading and chatting about documentation and doing sentiment analysis on customers that can tell a technician everything they might want to be aware of before placing a call.

“When was the last time this person was mad at us?” Jacobs imagines a tech asking. “Are they currently mad at us? Have we miss-billed them recently?”

In the meantime, Planner, Thread’s most recent enhancement, is in full production as of this week. The new tool lets dispatchers schedule tickets for future resolution.

“It’s a really modern experience,” Jacobs says. “You’re dragging and dropping tickets onto people’s calendars.”

Like the rest of Thread’s functionality, Planner integrates with Datto Autotask and ConnectWise PSA. Integration with popular automated scheduling solution TimeZest is expected by the end of the month.

According to Jacobs, Planner differs from most of Thread’s earlier features in that it’s meant for dispatchers rather than techs. Most MSPs, he notes, don’t actually want their dispatchers doing a lot of dispatching.

“It’s like a necessary evil,” Jacobs says. “As much as we can make their life more efficient, that person can be repurposed to go do more valuable things.” Eventually, Thread hopes to handle dispatching with minimal human help.

“We’re not quite there yet, but this is definitely a signal to the industry that we are going in that direction,” Jacobs says.

SaaS Alerts something something

SaaS Alerts, the cloud security vendor we’ve also written about a time or two here in the past, is pushing ahead in a previously explored direction of its own.

The company’s flagship solution, which is principally designed to protect end users, has long included functionality its partners can use at no extra cost to secure their own environment. Thanks to an offering introduced this week, every other MSP on the planet now has access to that same functionality free of charge for up to a year.

Called MSP Shield, the new feature epitomizes a defining SaaS Alerts principle since the company’s founding, according to CEO Jim Lippie (pictured).

“We feel that an MSP can’t protect their customers if they can’t protect themselves first,” he says.

MSP Shield serves two useful purposes for SaaS Alerts itself too. First, it will keep more MSPs safe from threat activity rampant enough to have drawn the attention of the federal government some four years ago.

“A thriving MSP community is good for SaaS Alerts,” Lippie observes. “That’s the only people we sell to.”

MSP Shield should lead to more sales too, if past performance foretells future results. To date, 60% of partners who trial SaaS Alerts software purely for internal use end up using it to safeguard clients as well. The other 40% will have access to an affordable paid version of MSP Shield when their free year is up.

“It’s a great opportunity for us to offer protection for the community while also introducing them to a product we feel is going to be significantly helpful for their customers,” Lippie says of the new promotion.

Those customers need all the security help they can get these days, as the SaaS Application Security Insights report that SaaS Alerts published in March makes clear. While old school exploits like brute force attacks have become less prevalent in the past year, the study shows, newer and more sophisticated techniques like token hijacking (a form of man-in-the-middle attack) are rising to take their place.

As Kaseya Connect Global attendees with memories of the ransomware attack that took down one of Kaseya’s RMM solutions (and spurred new functionality from SaaS Alerts) can attest, MSPs can’t afford to take security lightly either. According to Lippie, though, most lack tools for protecting their management, PSA, and documentation systems at present.

“Their [Microsoft] 365 environments are relatively locked down, but there are very few opportunities for them to be able to monitor the other solutions in their stack,” he says.

SaaS Alerts’s own stack appears to be pretty safe, per an announcement yesterday that the company has achieved full certification under the ISO 27001:2022 security standard.

“We went out and got our SOC 2 certification a couple of years ago, but we felt like we needed to take it a step further,” Lippie says. Adding ISO 27001 accreditation too underscores how serious SaaS Alerts is about securing itself and thereby securing its partners, he notes. “It’s rigorous, it’s expensive, it takes a lot of time, but it’s important.”

And more rare than it should be, Lippie continues. A lot of vendors much bigger than SaaS Alerts that Lippie declines to name should be ISO certified but aren’t.

“They have the resources to do it. They choose not to,” he says. “This isn’t about having the money, per se. It’s about making it a priority.”

Also worth noting

The first traces of the coming RSA Conference security news tsunami have arrived already, beginning with news from RSA itself about its IAM support for Microsoft Office.

Here’s more: Palo Alto’s SASE solution now includes a zero-trust enterprise browser, AI-powered data security, and more.

AI-powered RMM-PSA platform SuperOps now integrates with unified cybersecurity software from Guardz.

Trend Micro’s Vision One solution now supports centralized AI employee access policies, prompt inspection to prevent data leaks, and defenses against LLM attacks.

Proofpoint has rolled out similarly genAI-aware DLP functionality.

CyberQP now offers passwordless MFA for technicians.

Deep Instinct has introduced an AI-based “cybersecurity assistant” designed to provide expert-level help with malware analysis.

BlackBerry has added something very similar for its Cylance platform.

1Password (watch for more on them here next week) has shipped an extended access management product designed to secure every sign-in for every app on every device.

Interesting newcomer: Mosyle has shipped an integrated Apple management and security solution for MSPs.

The role-based AI training resources and AI partner benefits that HP previewed recently are now fully available.

A higher ed edition of Copilot for Microsoft 365 is also now available.

Chris Babel, formerly of TrustArc and VeriSign, is the new CEO at Arcserve.

Aryaka has new names in its chief people officer, SVP of corporate and business development, and CMO roles.

Apptega, the compliance-as-a-service vendor I wrote about last year, has raised $15 million of growth capital.