Barracuda Sees Huge Shift to Managed Services Among Partners

Barracuda CEO Hatem Naguib says he is “not surprised at all” by an apparent overwhelming shift among its partners to managed services.

Barracuda’s Hatem Naguib

In a poll, 92% of partners said they identified now as MSPs. The poll was conducted at the vendor’s first in-person partner event in more than two years, Barracuda Discover 2022 EMEA, in Athens, Greece.

The results, said the CEO, were reflective of both market conditions and the company’s strategy to drive managed services.

“We decided five years ago to go heavy into MSP,” told Channel Futures. “When we created an MSP business unit we put behind that all of the components that allowed our MSP partners to engage with us.”

Now managed services is almost a fifth of Barracuda’s business, and is one of the fastest growing components, said Naguib. One reason is that SMBs are looking to MSPs to take on IT responsibilities that are hard to resource and manage.

“It’s a natural fit to have as an MSP model. And security fits exceptionally well in this model because it’s very resource-intensive,” he said “So I’m not surprised that all of these partners have recognised that and said ‘Alright, let me be a value add. I need to be involved and engaged in the MSP business.’”

Managed Services a Key Growth Lever

Barracuda’s move to managed services was augmented last year with the acquisition of SKOUT Cybersecurity, offering MSPs an extended detection and response (XDR) platform and service.

“[Managed services is] where we’ve made the most strategic M&A,” said Naguib. “Because we feel this is the tip of the iceberg. For us, it’s one of the key growth levers from here to the next seven years.”

The SKOUT platform connects with email, firewall, identity and access, and offers a 24×7 SOC to aid the detection of and response to cyberattacks. Critically, it reduces the expense associated with training and staffing for 24×7 service, instead leveraging SKOUT’s security professionals to handle the SOC operation.

“We’re now driving the security for them,” explained Naguib. “As opposed to ‘here’s the firewall go figure it out or let me manage your firewall.’ So it’s the natural evolution. It’s an exciting opportunity because it has really delivered some very impressive capabilities for our partners and for our customers. And we see this as a huge growth area.”

He added: “We continue to invest to make sure that whatever consumption option the customer wants they can leverage the products to engage with them.”

That investment may come from its recent acquisition by investment firm KKR. The firm is to purchases Barracuda from Thoma Bravo in a deal reportedly worth $4 billion.

Transition to MSSP

Altinet won Barracuda’s Partner of the Year 2022 at the event. Already an MSP, it is looking to make the transition to MSSP.

Altinet’s Henry Doyle

“[We want to] offer our customers as many cybersecurity services as we can. We’re not there just yet, but that’s where we want to get. It’s that next step, to go that extra mile to be able to provide that full end-to-end MSSP service,” said Altinet co-founder and director, Henry Doyle.

As part of this, Doyle said Altinet will incorporate SKOUT into its managed security offerings.

“You need to be monitoring 24/7 and letting the customer know when they’ve got breached. So when they get a ransomware attack, or they get a bot attack on their website, we’re telling them they’ve had that, it’s not going to cause any damage, we’ve remediated it for them. And they can trust in us. We do the work on their behalf. The big transition is moving away from the customer using the products, to us using the product as the as the trusted adviser and cybersecurity experts.”