Kaseya Overtakes ConnectWise as NinjaOne, Halo Gain Ground

The managed services software market has a new market leader for the first time in decades.

Kaseya has managed to knock ConnectWise from the No. 1 spot after 29 years, according to new research from Canalys.

Canalys said the time frame is based on ConnectWise starting to sell its software outside the company in 1995. It has been a market leader since then, with a greater share of larger MSPs.

Both firms have been acquisitive in 2024. ConnectWise acquired Axcient and SkyKick and Kaseya acquiring SaaS Alerts, among others.

In 2024, Kaseya focused on pricing and bundling with Kaseya 365 (K365), leading with "unit economics." ConnectWise, meanwhile, focused on the Asio platform and the platform economics around it.

Robin Ody led the research at Canalys, Channel Futures’ sister company.

Canalys' Robin Ody

“Kaseya has been more successful in Q3 due to K365,” he said. “It claims strong growth, and for many MSPs [that] struggle with profitability, its offering has been compelling.”

However, he noted that Kaseya will have to maintain that growth “and that could be tough.”

ConnectWise, he added, is in a transition period.

“[It] has a lot of opportunity ahead if it can really improve the Asio platform story, but it faces threats from every direction. It will need to double down on the cloud-delivered RMM, its backup (Axcient) integration, and cybersecurity services for MSPs.”

Related:ConnectWise's RMM/PSA Market Share Shrinking as Rivals Creep Up

Ken Roulston, managing partner at MSP EX2 Consultancy, believes Kaseya has done a better job in packaging its acquisitions.

EX2 Consultancy's Ken Roulston

“Specifically, I think the introduction of K365 EndPoint and K365 User are demonstrations of that,” he said.

Roulston said he also suspects “there is some concern over ConnectWise in terms of future and ability to finance the continued development required to compete.”

Another MSP described Kaseya as “a sales machine,” while ConnectWise “has lacked strong commercial leadership.”

NinjaOne and HaloPSA: Kaseya’s New Competition?

In other changes, NinjaOne grew more than 54% year-on-year and overtook N-able for the No. 3 market share position.

NinjaOne kicked off 2024 with a massive $231.5 million Series C funding round led by ICONIQ Capital. Frank Slootman, chairman and CEO of Snowflake, and Amit Agarwal, president of Datadog, were among others who invested in the round.

Ody said that NinjaOne has been successful in taking share from competitors over the last couple of years.

“Its growth is well-documented, so it has been a strong alternative to some of the larger players, particularly in North America,” he said.

It is a similar situation for U.K. firm Halo Service Solutions (HaloPSA), added Ody. Doubling in size with 102% year-on-year growth, HaloPSA now finds itself in the top five of global market share.

“It has been on a real marketing drive and has been doing all the things vendors need to do in this space to grow its business" he said.

The analyst highlighted HaloPSA being consistent in its go-to-market approach and providing assurances to the channel of its independence.

“Its partnership with NinjaOne on the joint platform play has also been timely for both vendors in providing an alternative to K365,” he said.

The global managed services software market grew in the third quarter at more than 25%, delivering $457 million in revenue. EMEA and APAC are driving MSP growth and propelling this category to almost $2 billion (annually) in size.

“Both Halo and Ninja play to the younger, hungrier, more agile companies who appear to have good products,” said Roulston. “I believe these guys are the real competition now to Kaseya, as opposed to ConnectWise.”