OpenText Acquisition of Pillr Gives It 'De Facto' MDR Solution

Information management provider OpenText is buying managed detection and response (MDR) platform Pillr from Novacoast in a move OpenText executives say will deepen its footprint with managed service providers (MSPs).

Ontario, Canada-based OpenText announced the completed deal on Wednesday. Novacoast is a Kansas-based managed security services provider (MSSP) and cybersecurity reseller.

OpenText didn't say how much it's paying to buy Pillr from Novacoast. Moreover, OpenText's announcement said that buying Pillr would not materially affect its financial results. OpenText in its most recent quarter reported $1.45 billion in revenue and $1.15 billion in annualized recurring revenue.

The buyer has been playing in the cybersecurity space with offerings like network detection and response (NDR) and identity and access management (IAM). However, managed capabilities were a gap.

OpenText's Mark Barrenechea

“Cyber threats continue to rise fast and are growing more sophisticated. Organizations need advanced managed detection and response solutions to prevent attackers from gaining the foothold needed to launch an attack," OpenText CEO Mark Barrenechea said. "The combination of Pillr’s platform with our existing threat detection offerings strengthens OpenText’s position in the cybersecurity market and reinforces our commitment to our SMB partners and customers.”

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Specifically, Pillr frames its MDR offering as focused toward MSPs. OpenText reports that more than 23,000 MSPs work with it, and managed security is a hot topic with that partner type.

It's OpenText's latest acquisition since buying automated business processes and project management solutions provider KineMatic in 2023. Prior to that, OpenText spent about $5.8 billion to buy the software services provider Micro Focus.

OpenText Acquisition of Pillr: Partner Impact

OpenText's Geoff Bibby

Channel Futures posed questions to Geoff Bibby, senior vice president of marketing and strategy at OpenText Cybersecurity.

Channel Futures: What was OpenText doing in MDR prior to this acquisition? Is this acquisition additive to an MDR approach/platform that already existed at OpenText?

Geoff Bibby: With this acquisition, Pillr will become our de facto MDR solution and is additive to our robust suite of security products. We see a lot of potential in being able to offer a simplified and fully managed detection and response capability to help MSPs secure their customers against rising threats. It’s exciting to see how perfectly Pillr fits into the OpenText Cybersecurity portfolio.

CF: How does this acquisition boost OpenText’s ambitions of working with the MSP community? Is there a particular goal of expanding share in the MSP market?

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GB: OpenText serves more than 23,000 MSPs. The acquisition of Pillr is consistent with our ongoing mission to offer a platform that simplifies security for MSPs. That's exactly what we are doing by adding the Pillr MDR capability to OpenText. This provides a really powerful addition to our already strong cybersecurity offerings for MSPs.

While ransomware threats have increased 96% since the start of 2024, organizations were just throwing in the towel on being able to keep up with these risks on their own. This acquisition is a key reminder of why managed security services are currently the No. 1 area of growth in cybersecurity, and that MDR is also the biggest growth area within this sector to help fill this gap.

This acquisition will also help OpenText expand our MSP footprint with hundreds of Pillr customers in North America and the U.K., as well as increase our share of wallet with new segments like K-12 education organizations and others.

CF: Is this news of interest to OpenText’s non-MSP partners? I’m thinking of different consultancies and professional services firms in the partner directory. Any impact to them?

GB: We welcome all non-MSP partners to become OpenText MSP partners. There will be no impact to the professional services firms that are in our partner directory.