PrintIT Reseller caught up with Jason Howells, Director EMEA at Barracuda MSP
PrintIT Reseller (PITR): Barracuda has been very successful building momentum in the MSP market, particularly around security offerings. Can you tell me a little bit about the company’s background?
Jason Howells (JH): I think it’s important for people to recognise the machine that is Barracuda, and what’s behind our MSP business. Barracuda is 15 years old, we are about 1,500 employees across the world, we have offices in 15+ countries, and we’re focused on, and come from a security background. The first product we had was an email spam filter product. We’ve grown out from there.
The key focus for us is around emails still, even after 15 years, it’s still front and centre. But also, networks and data applications, it’s all about trying to make sure those are secure. We’re owned by Thoma Bravo, they acquired us, took us from the public company we were about two years ago, back into a private company and that has helped fuel our growth.
PITR: You run the MSP business at Barracuda, how did that part of the business come about?
JH: As far back as 2014, most of our smaller customers (end-users), actually showed a desire to not actually own and manage their own Barracuda products.
The back end of 2015 was Barracuda’s first strategic move into having a MSP business. It truly is a MSP, it’s not a partner program with a MSP offering to it. We have a dedicated team which I run outside of the US and Canada, and that came from an acquisition of a company called Intronis. They had built up a associated to it. At that time they were servicing around 2,500 MSPs with that back-up. We spent around $54m buying the platform and technology.
That was our strategic investment in the MSP world – we didn’t just want to be a vendor that took our products and gave a monthly billing option. We wanted to be fully invested, have other tools that fully integrated with remote management and monitoring tools, and professional service optimisation tools that are the foundational technologies that MSPs need to run their businesses. We need to have integrations with those platforms, we wanted to be able to building Barracuda products that we felt were extremely relevant, particularly around security, to MSPs and their customers, and that was the start of our journey.
Here we are now, three years on, and we have grown our international MSP partner base nearly 300 per cent over the past two years, and most importantly, the number of MSPs using multiple Barracuda solutions increased 34 per cent year-over-year, as of February 2019.
PITR: Barracuda has expanded its MSP security offerings introducing Managed PhishLine, a service that helps MSPs provide sophisticated phishing simulation and security awareness training to their customers without creating added work for their techs and more recently, with the acquisition of Managed Workplace, the remote monitoring and management (RMM) product line of Avast. Where is the business’ key focus?
JH: One of the first acquisitions that Thoma Bravo helped us to do once we became private was with Managed Workplace. That is purely for the MSP business in Barracuda and was a really interesting investment for us. It really showed the dedication that Thoma Bravo had, that Barracuda had, in continuing to invest in and develop the MSP business we have today.
With the acquisition of Managed Workplace, we now have around 4,500 active MSPs across the globe. We are somewhere approaching 1,000 active partners (billing them monthly) outside of the US and Canada. That’s growing on a daily basis.
In terms of our focus, one of the big focuses we have right now is email security and in particular phishing attacks. The difference with that is that for many, many years, people have been trying to protect themselves from malicious code that appears in email. You can put a whole lot of technology in front of it to detect malicious code, and you can block it and stop it. But with social engineering attacks, which these phishing attacks are – there’s no malicious code in the emails.
PITR: What’s attracting MSPs to partner with Barracuda?
JH: For us to be able to build a stack of products that will help protect end-users, managed by a service provider has been phenomenal. It’s actually what’s helping us recruit so many new partners into the Barracuda portfolio.
There are several layers, and I think that’s important. It’s not ok to just drop antivirus into your network, and feel you’re protected. There are a lot of small businesses that don’t have an IT department, or technical resources. It’s very expensive to get that kind of resource and that capability into your business, so people are turning to MSPs because they’ve thought that stuff out, built the solutions out, so for a smaller, monthly fee, you can now go and get enterprise-level protection. That’s why the model works so well and why MSP right now is seeing the growth it is.
If a MSP is wise and can work with a vendor that has multiple layers of security, they’re able to build out an offering which perhaps includes many layers across many end-users. If they work with a vendor that allows them to streamline their operations, so it integrates with other products without human intervention, there is one single place to go to, to do a whole bunch of monitoring and managing of that solution or of those products. It means they can then afford to go to their small customers for a relatively inexpensive monthly fee, which a small business can afford and sustain.
For us as a vendor to be able to offer a model to MSPs, which they can replicate to their customers, allows them to be successful. We believe however you choose to consume, it’s our job to make that as simple as possible, and as available as possible to MSPs, as that allows them to then pass it on to their end-users. Regardless of need, size etc., Barracuda MSP can provide that solution.
PITR: Cybercrime continues to evolve at a rapid pace, how can MSPs ensure their customers remain protected?
JH: In the world that we have today, with cybercrime, those guys are extremely intelligent and evolving at a rapid pace. We, as a vendor, have to keep up with that and try and get ahead of that, and we have to offer those layers.
A small MSP without a huge amount of resource can start getting involved with us because we can offer a fully managed PhishLine, a service that helps MSPs provide sophisticated phishing simulation and security awareness training to their customers without creating added work for their techs. This makes it easy for a MSP to create a new service that addresses the growing need for better security awareness training.
They don’t need an engineer building out email simulations to send out to organisations to see who needs educating on it or not. We do all that for them. For a very simple monthly fee, they can jump on board with Barracuda and tell their customers about it, and I can guarantee that every single one of their customers will realise they have a need for it.
Some end-users really care about educating their employees, some want to make sure that if they do have a breach, they have a security solution for compliance reasons, and others have to demonstrate to insurance companies that they’re absolutely trying their best to help their employees not to do the wrong things, otherwise the insurance companies won’t pay out. So it’s hugely relevant, and not just for large organisations. These guys are attacking smaller organisations, because they don’t have the defences, the education in place. They can hit a bunch of small businesses and get the same kind of return for their efforts. Everybody is at risk. If a MSP is not talking to their customers about this stuff, somebody else will be, because the problem needs to be resolved.
PITR: You mentioned there are multiple layers of security, presumably that means a MSP can continue to increase recurring revenues by adding in more solutions?
JH: Yes. It doesn’t matter where they start, there’s a stack of different products and solutions we have around email. Whether their customer is just looking for back-up, office365 for example, cloud back-ups, or even if they just want to make sure the cloud is secure, we can help them to do that.
But we also have Sentinel, which is AI that learns how I might send an email to you, and you to me, and learns those patterns. And if it sees something irregular, it will flag and highlight. What we’re seeing with MSPs is that they just start with one of those layers, they’ll go do a back-up, for example, and eventually they start talking to customers about the additional layers that come in. And all of a sudden you have five or six layers, which is probably what the customer needs, and if it’s just a few more pounds a month, it’s very easy for their end-users to be able to justify that and consume it.
PITR: Is your go-to-market channel strategy based on direct relationships or does distribution come into play?
JH: I think it’s important for us to embrace the channel as a whole. When we started, we built a database, a model and a team that we knew had worked in the US and went out and started talking to MSPs and they were very quick to sign up with us.
We are now starting to see more resellers looking to offer services without making huge investments, they are looking to change the model of their business. There’s a lot activity around moving from on-premise to cloud and they’re trying to find a way to do that. It’s not easy in terms of cashflow for a business to move to a monthly recurring revenue billing model that takes time to build. I feel we’re helping people to do that.
Distribution has a part to play as well. They’ve started building managed service offerings and vendors that are specialising in that space. It’s relatively early days for us in this channel but I’m sure that we will see some success and distribution will give us wider reach and depth into the UK. It’s become more important to us in different countries, working with a distie as an extension of what we do, but in a local language is of extreme value.
PITR: The Barracuda team has also demonstrated its commitment to building up the MSP community through several educational initiatives. Can you provide an example?
JH: Initiatives such as Ready, Set, Managed!, an exclusive, interactive educational and networking program for VARs and MSPs to learn best practices for successfully growing their managed services operations, saw 136 per cent growth year over year in the number of channel partners that have requested an invitation to the programme.
PITR: Tell me about your future plans.
JH: Although we’re seeing a lot of growth and success, I feel like we’re only just scratching the surface. The results that we’re having is allowing the company to invest even more in the MSP business. For example, my team is going from 11 in FY19 to being 19 at the start of FY20. Our reach is getting wider we’ve spread into northern Europe with Managed Workplace. We have a huge number of partners in Germany and Switzerland, we have an APAC team, focusing on going into Australia, there’s a lot for us to do.
Our existing customers are learning about what we can do with Managed Workplace. We’ve been a security focused expert in the MSP space, but what we’re now doing is getting into the foundation play of remote managing and monitoring tools, with a security focus, which I feel is a real differentiator between other MSP tools on the market. This is right in the heart of an MSP business, as these are the tools that automate and service their customers that are highly remote, that they can’t afford to send engineers out all the time to manage and monitor them. For us to help them with the core of their business, and then attach the management-level security products they need, right down to endpoints, is the next chapter in what we’re looking to do.
The acquisition was relatively recent, but has potentially doubled business, in terms of partners. It’s a huge opportunity for us. Our existing customers that are perhaps using a RMM today or know they need to invest in one, we can show them how they can start to buy that from Barracuda.
With Managed Workplace we can offer MSP partners a security-centric RMM solution that incorporates security tasks into a service provider’s daily routine. It complements the security solutions we have introduced via our MSP model, such as email protection, cloud-generation firewalls, and security awareness training.