Kaseya’s Fred Voccola Apologizes To MSPs For Billing Issues: ‘This Was A Mess Up On Our Part’
‘One of the things that we talked about not doing when we buy companies, we don’t want to break things,’ says Kaseya CEO Fred Voccola. ‘Some of you that have experienced issues, we apologize and, believe me, we are 24/7 trying to get better trust, and that’s on us. There’s no excuse for that.’
Kaseya CEO Fred Voccola Tuesday apologized for billing issues that have been plaguing some of the company’s MSPs in the wake of its Datto acquisition.
“One of the things that we talked about not doing when we buy companies, we don’t want to break things,” Voccola said in a main stage keynote session in front of several thousand MSPs at the company’s DattoCon conference in Miami. “Some of you that have experienced issues, we apologize and, believe me, we are 24/7 trying to get better trust, and that’s on us. There’s no excuse for that.”
After Miami-based software vendor Kaseya bought rival Datto in 2022 for $6.2 billion, it integrated the partner experience, the financial aspect of billing and invoicing, “and we automated many of the tasks,” said Voccola, according to a recording of the session heard by CRN.
CRN reached out to Voccola and Kaseya for comment but had not heard back as of press time.
“We did five things right, three things wrong … 10 things right, three things wrong,” Voccola said. “Every decision that we made, hopefully we made the right ones but we made mistakes when we integrated our billing, our back office [and] systems. That’s a hard task to do. Datto was a public company.”
Eight percent of partners experienced billing issues since the acquisition, said Voccola, but Kaseya has gotten that number down to 2 percent. He said that only 1 percent of MSPs will be experiencing billing issues by the end of the month.
“Kaseya is a very, very large company [with] very different systems,” he said. “We integrated. There were some external reasons why we integrated them as fast as we did, and what happened in that process is about eight percent of our partners experienced issues around billing. Things that seem obvious but got through, that’s on us. There’s no excuse. It’s not because it was hard. It’s not because it was someone else’s fault. It’s something that we did not do well.”
By the end of the year, Voccola promised that the experience will be “super kickass with a whole bunch of new things.”
“But I’ll be very candid, we dropped the ball [and] this was a mess up on our part,” he said. “I want to apologize to the group that’s been affected by it, because the last thing we want to do is break things. We think it’s an amazing market, and it’s a great time to be an MSP.”
Partners Have Mixed Reactions
Dan Tomaszewski, president of Jenison, Mich.-based Green Light Business Technology and Everything MSP, who was at the keynote session, said he greatly appreciated Voccola apologizing for the billing issues.
“For him to get up there on stage in front of thousands of Kaseya partners and not sugarcoat it, just pure honesty of, ‘This is a problem. It’s on us, we’re addressing it,’ I respect him having that difficult conversation,” he told CRN. “Even as MSPs, when we put different systems in place, no matter how well we orchestrate it, things still go wrong.”
Tomaszewski said he is not one of the partners who experienced billing issues with Kaseya.
“When you take a look at the size of an organization like Kaseya and all their acquisitions and trying to pull together everything in one system, it’s certainly understandable that things aren’t going to be perfect,” he said.
While the apology and taking accountability came at the top of the show, Tomaszewski said there were “so many great things” announced during Voccola’s keynote.
Among the other issues touched on were a new Flexspend for backup program that gives MSPs flexibility in adjusting their backup spend to whatever configuration is required as they shift workloads to public cloud; secure payments, which eliminates non-compliance risk for MSPs, and new AI integrations.
“The first thing that he talked about was this billing issue, and he hit that head-on so that he could just address the elephant in the room and get that covered,” said Tomaszewski. “That was something I applaud him for.”
Several partners told CRN they pulled business from Kaseya because of the billing issues.
“I’d rather he not apologize and just fixed my issues,” said Michael Cervino, president of Radnor, Pa.-based MSP Circle Square Consulting, which pulled most of its business from Kaseya.
Cervino, who did not attend the event, told CRN his billing issues go back to March of this year when Kaseya began billing monthly contracts annualized every month.
“The problem was they couldn’t even figure out where they were misbilling,” he said. “It took them three weeks to say, ‘Yeah, we know we messed up. We just don’t know where the problem is.’”
Cervino said that Voccola apologizing for the issues are a little late for him. “The billing issues were the final straw,” Cervino said. “The apology means nothing. I wanted an acknowledgement early on.”
Keith Nelson, CTO and CISO of Irvine, Calif.-based Vistem Solutions, who was not at the show, told CRN he also pulled almost all of his business from Kaseya/Datto as a result of the billing issues his company experienced.
Nelson had billing issues for months and took to Reddit and Facebook earlier this year to air his grievances. “When I posted that after numerous calls and no responses, they were more upset that I posted something [on social media] than something went wrong,” he told CRN. “They asked me to take it down.”
Nelson claimed that Kaseya kept billing one of his customers even after he removed the customer’s credit card from his Kaseya account.
He is still getting overbilled $100 a month but doesn’t reach out to resolve it “because it’s not even worth spending time on.”
“If they need the money they can have it,” he added. “I think it’s horrible optics to buy a stadium when they can’t figure out how to bill MSPs right. You’re really not investing into billing, you’re investing into ego.”
In April, Kaseya purchased the naming rights to the stadium that is home to the Miami Heat basketball team for $117 million, renaming it The Kaseya Center.
‘Datto Is Starting To Rub Off On Kaseya’
Marc Menzies, president and CTO of New York-based MSP Overview Technology Solutions, who experienced billing issues, was glad Voccola owned up to the mistake.
“Companies mess things up, it happens,” he told CRN. “It caused a lot of challenges for us, but I appreciate him apologizing. I’d like to see more of this. We don’t normally want to see the CEO grovel, but I think as a whole Kaseya needs to show this apologetic nature of, ‘Hey. We’re growing. It hurts. Things happen.’”
In the future, he hopes Kaseya will be more candid about its growing pains and follow more closely in the footsteps of Datto, which was highly regarded for its MSP-centric culture.
“I think this is the step in the right direction for them,” he said. “I think that Datto is starting to rub off on Kaseya.”