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N-Able’s SEC filing talks market size

I get asked about the MSP market size a lot.    With SolarWinds MSP spinning off from N-Able, their filing with the SEC has given some perspectives.

Roughly 1,473 MSPs generated at least $50,000 in annual recurring revenue on N-able’s software platform in 2020, up 34 percent from 1,117 in 2019.    That’s at least $4100 a month.   The company claims more than 25,000 MSPs are customers. 

The company believes that the market for RMM, security and data protection will be $43.9 Billion by 2025, which is up from $23.3 in 2020.  This is from a Frost and Sullivan report they commissioned, and it’s a compound annual growth rate of 13.5%.

From that filing, the company did incur a decline in new subscription sales and expansion rates due to the blowback from the SolarWinds Orion hack, expecting to incur “significant” costs and expenses relaed to the hack.          

Oh, and of note – the company listed Datto and Kaseya, as well as Auvik, Mimcast and Veeam as competitors, but not ConnectWise – who is also backed by their private equity firm Thoma Bravo.

If you’re wondering what a CEO of a company like this makes, theirs made $6.7M in 2020.

Why do we care?

There’s constant discussion about how large the market is.   I found it notable that the survey focuses on spend and not the raw number of providers.    When I measure the market, I’m often aasked about the number of providers.  Tracking, N-Able’s net new MSPs were about 4,000 or so in the past four years, tracking back to the creation of SolarWinds MSP.     The surge in spending isn’t surprising – besides being obvious, IT spend always goes up.   And usually about this rate.

Why no ConnectWise as a competitor?   The obvious answer is the shared backer.      They’re clearly a competitor.  Duh.

The blowback is also to be expected.  The question that matters is how long it lasts.  I predict… not too long.   The market hasn’t historically harsh on these incidents.     Memory is not long.

Source: Channel E2E

Source: CRN