It's Official: Datto and Autotask To Merge

October 26, 2017, 12:04 PM EDT

Data protection vendor Datto and IT service management vendor Autotask will merge, as reported by CRN, creating an MSP platform giant with more than 13,000 SMB-focused channel partners across the globe.

As a precursor to the merger, Datto is being acquired by Vista Equity Partners, which has owned Autotask since June, 2014. The acquisition is expected to close in the fourth quarter, with both companies continuing to operate under their respective brands for the time being.

"Over the past three years, we have worked closely with the Autotask team to accelerate growth and expand its Unified Platform," Brian Sheth, Vista's co-founder and president, said in a statement. "Bringing Autotask together with Datto's impressive talent and deep expertise in backup and networking solutions will take us to the next level and deliver extraordinary tools and services to MSPs worldwide."

Solution providers said the combination of the two companies will create big opportunities for the channel.

"Datto is a really, really strong player in that backup space," said Micah Thor, president of Minneapolis-based MSP Tech Guru. "It makes a lot of sense for these vendors to consolidate."

The combined company will be led by Datto CEO Austin McChord, who founded Norwalk, Conn.-based Datto a decade ago when he was just 21 years old. Mark Cattini – who has served as CEO of East Greenbush, N.Y.-based Autotask since December 2010 – will transition to being a strategic advisor to the combined company's board of directors.

"With the powerful combination of the Autotask Unified PSA-RMM [professional services automation - remote management and monitoring] platform and Datto's industry-leading business continuity solutions, together we can now deliver unprecedented innovation and unmatched levels of value and service to our customers and partners worldwide," said Cattini, in a statement.

McChord said the deal will provide the combined company's MSP partners with the ability to deliver an unprecedented set of tools to their small business customers. Joined together, the combined company's channel partners service more than 500,000 SMBs in 125 countries around the world.

"We're honored to be joining forces with both the world's premier software investor, Vista Equity Partners, and with Autotask, the provider of the most essential tools for the MSP space," McChord said in a statement.

Terms of the deals were not disclosed. Autotask and Datto together employ approximately 1,300 people across nine countries.

Autotask and Datto have already begun planning work on a joint product roadmap that leverages Autotask's PSA-RMM integration and provides a seamless set of offerings that meet the evolving needs of customers, according to a Frequently Asked Questions (FAQ) document posted on Autotask's website.

Customers of both companies will retain their existing account managers, and support channels will remain staffed by the same service team MSPs are used to working with, according to the document.

The Datto merger will put Autotask in more direct competition against Boston-based Continuum and Durham, N.C.-based SolarWinds MSP, who are both also heavily focused in the RMM and backup and disaster recovery (BDR) spaces.

Datto today partners with many of Autotask's top competitors including Tampa, Fla.-based ConnectWise and Kaseya, headquartered in New York and Miami, while Autotask currently works with some of Datto's data protection rivals such as Acronis and StorageCraft.

Autotask has expanded well beyond its PSA roots since Vista bought the company 3.5 years ago, making acquisitions focused on RMM and file sync and share and building an endpoint backup practice organically.

Datto's core offerings, meanwhile, include business continuity, managed networking and backup for cloud-based applications such as Office 365. The company in June rolled out flash storage-based appliances, better options for Office 365, and new networking capabilities such as quality of service control.