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ConnectWise-Continuum buyout shakes up MSP software market

ConnectWise is purchasing its longtime competitor Continuum in a deal that is guaranteed to reshape the managed service provider software space.

ConnectWise, a provider of software for managed services providers, has acquired its competitor Continuum.

The Continuum acquisition was announced today by ConnectWise CEO Jason Magee at his company's annual user conference, IT Nation Connect, running from Oct. 30 to Nov. 1 in Orlando, Fla. The buyout, which is poised to shake up the MSP software market, accompanies the acquisition of ITBoost, an IT documentation vendor. ConnectWise also revealed a strategic partnership with partner relationship management software provider Webinfinity to help ConnectWise partners manage their vendor alliances.

"[The Continuum acquisition] allows ConnectWise to address the growing pains of our partners and some of those pains around talent and skills shortages ... [and] continues to accelerate ConnectWise in the cybersecurity area," Magee said in a press briefing.

ConnectWise and Continuum are owned by private equity investment firm Thoma Bravo. Thoma Bravo purchased ConnectWise in February. The private equity firm also owns MSP software players (and ConnectWise-Continuum competitors) SolarWinds and Barracuda Networks.

ConnectWise's platform spans professional services automation, remote monitoring and management (RMM), and 'configure, price and quote' software. Continuum's development of a global security operations center (SOC), network operations center and help desk technologies will be "complementary" to what ConnectWise does today, Magee said.

Jason Magee, CEO of ConnectWise Jason Magee

The future of ConnectWise and Continuum's RMM platforms, ConnectWise Automate and Continuum Command, remains in question. Magee said the respective RMM platforms "will be maintained [separately] at this point." After the IT Nation Connect 2019 event, the companies will begin working on its overall business plan and joint roadmaps, "which to this point we have not been able to dig into much due to regulatory restraints around getting government approval of making the deal happen and so on," he said.

Magee suggested that in the short term ConnectWise-Continuum partners could see some innovations introduced to the Automate and Command platforms. He pointed to a few potential examples, such as making Command's LogMeIn remote control available to ConnectWise partners and adding features of Command's automation and patching capabilities to the Automate platform. He didn't specify the timing around implementing any changes but said partners could expect to see some in early 2020.

Although the post-acquisition is still in the planning stage, Magee said Continuum's CFO Geoffrey Willison will be brought as COO at ConnectWise, and the senior vice president of global service delivery, Tasos Tsolakis, will join as the senior vice president of service delivery "over all ConnectWise going forward." Additionally, Magee said ConnectWise will hire a new CFO for the combined business.

"Until we have the rest of the best of the business plan done, it is business as usual," Magee said.

Addressing two types of MSPs

Magee said that the ConnectWise-Continuum acquisition also serves to benefit "two mindsets" that have emerged among MSPs.

The first mindset is of the do-it-yourself MSPs that build their practices by partnering, buying platforms and tools, and hiring teams to manage and service their customers. The second mindset is of "the companies and people [that] just want to go hire the general contractor, and those people are asking for someone else to manage [their customers] for them, take the hassle out of having to do all that stuff within their company or themselves."

This opens up a whole new world from a ConnectWise standpoint.
Jason MageeCEO, ConnectWise

"This opens up a whole new world from a ConnectWise standpoint," Magee said.

For a few years, ConnectWise has been establishing a 'connected ecosystem' of third-party software integrations around its platform, and the company will remain committed to that strategy. "We are still committed to the power of choice for our partners and will continue with our API-first mindset, which allows for continued partnership with the 260 and growing vendor partnerships that we have out there," Magee said. "These are all great options for those [MSPs] that like to do it themselves."

When asked if Magee anticipated challenges in merging the ConnectWise and Continuum communities of MSP partners, he said he didn't expect any problems but would address any issues that may crop up to ensure "we are doing right by the communities."

"At the end of the day, there is so much good and greatness that comes from bringing these two together that the partner communities are going to benefit tremendously."

ITBoost, Webinfinity and cybersecurity initiative

In a move similar to MSP software vendor Kaseya's buyout of IT Glue, ConnectWise is purchasing documentation provider ITBoost. ConnectWise said the IT document tool will be integrated with its product suite.

Magee said the Webinfinity partnership will help ConnectWise launch ConnectWise Engage, a tool for channel firms for simplifying vendor relationship management. ConnectWise Engage aims to give partners "the ability to receive enablement content and material or solution stack information" from their supplier partners, he noted. Additionally, ConnectWise said the Webinfinity alliance will help centralize vendor-partner touch points for areas such as deal registration, multivendor support issues, co-marketing and SKU management.

ConnectWise today also revealed a cybersecurity initiative, which Magee is calling 'Fight Back,' to encourage vendors, platform providers, MSPs and MSP customers to up their security awareness and capabilities.

Magee noted that ConnectWise recently achieved SOC Type 2 certification and will mandate by early 2020 multifactor and two-factor authentication across its platforms. The company in August rolled out its Technology Solution Provider Information Sharing and Analysis Organization, a forum for MSPs to share threat intelligence and best practices. "This is an area that ConnectWise for years has strived to be better. We are not perfect by any means, but we strive to get better," he said.

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