Sources: Autotask, Datto Set To Merge In Private Equity Deal

Managed services stalwarts Autotask and Datto are planning to merge, giving channel partners everything from IT service management to backup and disaster recovery under one roof, according to sources.

The companies will be joined together under the stewardship of private equity powerhouse Vista Equity Partners, which has owned Autotask since June 2014. Autotask declined to comment, while Datto and Vista Equity Partners didn't immediately responded to requests for comment.

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 remote management and monitoring (RMM) and backup and disaster recovery (BDR) spaces.

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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.

Austin McChord founded the Norwalk, Conn.-based data protection developer Datto in 2007 when he was just 21 years old, while Mark Cattini has served as Autotask's CEO since December 2010.

Autotask has expanded well beyond its professional services automation (PSA) roots since Vista bought the company 3.5 years ago. The East Greenbush, N.Y.-based vendor began by expanding into the RMM space in September 2014 with its purchase of Buckinghamshire, U.K.-based CentraStage, which is now known as Autotask Endpoint Management (AEM).

Ten months later, Autotask moved into the file sync and share space with its acquisition of San Jose, Calif.-based Soonr, which was renamed Autotask Workplace (AWP). And in September 2016, Autotask took advantage its own organic investment to add a fully-automated endpoint backup offering to its suite of tools.

Datto, meanwhile, scored a $1 billion valuation in November 2015 when it received a $75 million Series B investment from Technology Crossover Ventures. The company didn't take any venture capital money until 2013 when it had at last become profitable.

The company said at the time that it planned to use the Series B investment to expand into Australia, New Zealand, Europe, the Middle East, and Africa. Datto also reassured the industry at that juncture that the company was already profitable.

Datto's core offerings 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.

The company also announced a move to give MSPs a virtual desktop infrastructure that will help them provide services to the hundreds of thousands of small businesses they may not be able to reach now. Additionally, Datto rolled out a new managed power strip to help channel partners reboot servers and desktops without sending a technician to customer sites.

The company's business continuity offering keeps copies of data on-premise and in the Datto cloud, and is backed by the company's own 300-plus-TB cloud based in nine data centers around the world. Datto's line of managed routers, switches and Wi-Fi equipment, meanwhile, was enhanced in January's with the company's acquisition of Open Mesh.

Datto's SaaS protection line, meanwhile, is intended to handle instances of application failure. The company has recently rolled out a faster architecture for managing Office 365 data protection as well as an on-premise cloud that protects Office 365 data for verticals such as financial services where companies are required to know exactly where their data is physically located.

Autotask, meanwhile, recently repurposed its analytics engine by bringing substantially more data from its RMM offering into its PSA offering, enabling solution providers to obtain more technical information about devices in a business context. The amplified analytics also provide MSPs with more insight into if they're pricing correctly as well as which clients and services cost more to support, the company said.