Kaseya CEO: 'We will be public by Q2 of next year'

Fred Voccola reveals plans to go public next year and why recent M&A activity is centred on security specialists

Kaseya will undergo an IPO "no later" than the second quarter of next year, according to CEO Fred Voccola.

The Dublin-based IT management software vendor has been in the hands of private equity firm Insight Partners since it was bought from its founders in 2013.

"We've ramped up our audit process and Insight is on board with that. I think there's a very high probability that we will be a public company in 15 months," Voccola said.

"You'll probably see us valued at $3bn or $3.5bn instead of $2bn. Markets are really excited for it, we're talking to the banks, we're getting ready to go and we're excited about it."

Kaseya recently attained ‘unicorn' status with a valuation of $2bn.

The vendor reported over $300m in annual billings - which it said was a 30 per cent rise on 2018's figure - and $100m EBITDA. It also raised $500m in investment last year.

However, the chief exec is wary of the ‘unicorn' mantle due to the headlines made by other such companies recently, including Uber and WeWork.

"When most people think of a unicorn company, they think of one that has a high valuation but loses a ton of money," he explained.

"I'm not saying they're bad businesses, but they lose tons of money and there's a history of companies that are ‘unicorns' that end up not doing well.

"It was crazy during the first dotcom bust, where companies were worth $1bn and had no revenue, and some of that's carried on.

"So we take a lot of pride in the fact that we're very profitable; we are valued on a multiple of earnings whereas most unicorn companies are valued on a multiple of revenue because they have no earnings."

Security spree

Kaseya's owner Insight recently acquired rival Veeam for $5bn and Voccola dismissed the idea that the companies could unite or that Veeam might acquire Kaseya, though the latter will undertake a number of acquisitions itself this year and next in preparation for going public.

There has been a lot of consolidation in the security and compliance space in recent years, with BlackBerry acquiring Cylance and Webroot merging with Carbonite before the latter was acquired by OpenText.

Voccola attributed this consolidation to the need for vendors to be able to have complementary security offerings to cater to customer demands. Kaseya last year invested $10m to strengthen its own compliance unit and acquired dark web monitoring firm ID Agent to bolster its security offerings.

"Companies have a big customer base and they need to make sure that they're providing solutions that their customers want so that they can continue to grow," he stated.

"Companies' most recent buying pattern is investing in compliance and security. It's a huge thing, we all see it. There's a big rush for larger companies to get a security product portfolio that they can then offer to their customers.

"I think it's going to continue and it's a good thing. I know because we are the aggregator in our market - the market for managed service providers and SMB IT - we made nine acquisitions and we'll continue to do it because it really helps us offer a comprehensive solution to our customers."