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Kaseya’s CEO gives us insight into software vendors financial incentives

Finally, I want to quote the Miami Herald in an interview with Kaseya CEO Fred Voccola, talking about their recent breach breach.

Voccola said Kaseya, which is privately held and employs 275 workers at its downtown Miami headquarters, will likely lose “a few points of growth” in the aftermath of the hack, but that its long-term trajectory remains the same. The firm said in May it plans to hire 500 workers through 2022 – a plan Voccola said remains in place.

“The part of our business that got hit is an important one but a small one, ” he said. “We have 1,600 people worldwide, and US$400mil (RM1.6bil) in recurring revenue. We might go from a 28% annual growth rate to 26% or 25%, but I haven’t really thought about those numbers as much. Right now, I’m trying to make sure every single one of our customers gets back online.”

Why do we care?

It would be easy to jump on this as some smoking gun about their lack of investment in security.    I think that’s a red herring.

The main point is this – the metric he wants the world to know about is his growth metric.  His success is measured by his Board and his investors, and what they care about is annual growth rate.    He is absolutely focused on getting past this issue – but he has not forgotten what he is measured on.   He’s just been busy and not focused on it as much.  

Don’t hate the player, hate the game.   Want different outcomes?   Find out from your vendors how executives are compensated in keeping your business secure to your level of satisfaction.    Voccola’s answer is going to be the same for most private equity backed software companies – growth is the key metric.    Now use that knowledge and do something different.   Maybe the only way to win… is not to play.