This week, I am attending the DattoCon Conference in Miami, FL, with about 5,000 people in attendance. Of those, 3500+ are Managed Service Providers (MSPs). While I plan to share some technology insights I gained later, I always enjoy the statistics that Kaseya shares. As normal, Kaseya did not disappoint, sharing five startling statistics about small and midsized businesses (SMBs) in the opening keynote.
Kaseya, DattoCon, and the Statistics
Kaseya in general and Datto specifically, focus on delivering technology for use by MSPs that service SMBs. It classifies small businesses as those with 5-100 employees and mid-sized businesses as those with 100 – 1,000 employees.
Due to its laser focus on these size businesses, and the number of SMBs served by its MSPs, Kaseya knows this market very well. As a result, Kaseya (the parent company of Datto) tends to obtain, and often share, statistics about this market.
Now, for the record, I am unsure as I write this, exactly where Kaseya obtained the statistics that I share here. Maybe it paid another analyst or research firm to produce them. Maybe it did its own in-house research. Maybe it found them on other websites. Regardless, if Kaseya provides the sources to me after I post this blog entry, I will update the blog entry accordingly.
However, I share them in large part because I find them both plausible and believable. Kaseya itself has said it has seen DattoCon grow from about 800 (or maybe it was 200) attendees 8 years ago to over 3500 attendees this year.
This growth makes sense in my mind. This stems from both the technical challenges SMBs face and the technological advances that have occurred in the past few decades. Those disclaimers out of the way, here are some of the more startling statistics that Kaseya shared during DattoCon:
5 Startling SMB Statistics
Startling SMB Statistic #1: 90 percent of SMBs will spend more money on technology in 2025 than in the prior year.
The fact that SMBs continue to increase their technology spending should be of particular interest to MSPs. This is the primary if not the only market most MSPs in attendance serve.
If SMBs spend more money on technology, MSPs stand poised to be outsized beneficiaries of SMBs increasing their technology spends.
Startling SMB Statistic #2: SMB technology spending will outpace annual GDP by 5x through 2030.
According to Kaseya’s CEO Frank Vaccola, the last time another market segment saw this type of outsized technology spend was among enterprises. This occurred from approximately 1990 to 2010 when their technology spends outpaced annual GDP by 4X.
This same trend among SMBs started in 2010 and has outpaced GDP since then. SMB technology spending currently outpaces GDP growth by about 5X. Further, their spending is forecast to continue through at least 2030.
Startling SMB Statistic #3: 50 percent of SMBs will outsource most or all their IT services by 2030.
Whether 50 percent of SMBs outsource most or all their IT service by 2030 does make me wonder. However, most SMBs will readily admit they do not focus on technology. They focus on their core competency – accounting, dentistry, lawn care, plumbing, or whatever it is they do.
Outsourcing their IT needs from networking to backup to DR to antivirus to a competent MSP makes sense. Further, outsourcing IT functions to a third party frees them to better deliver on their core competency.
Startling SMB Statistic #4: 70 percent of cyberattacks target small businesses.
Again, another statistic that I am unsure how Kaseya quantified, but am inclined to believe. SMBs typically have lower cyber defense profiles, since they lack the necessary IT cyber infrastructure and IT staff to fully and properly implement and manage it. This makes them prime targets for cyber criminals.
Adding to their appeal as cyber targets, if attacked and compromised, they may never report the incident to law enforcement. This stems, in part, from the ransom demand being too small for law enforcement to prioritize dealing with it. As a result, SMBs may opt to pay a ransom rather than get law enforcement involved.
Their ransom payments may not run into the tens or hundreds of thousands of dollars or millions of dollars. However, ransoms of thousands of dollars do add up. Again, hard for me to validate, but believable, nonetheless.
Startling Statistic #5: 92 percent of small businesses are dependent upon technology for their daily operations.
In 2015 only 48 percent of SMBs were dependent upon technology for their daily business operations. This percentage has nearly doubled in the last decade to 92 percent of SMBs being dependent upon technology to operate.
Here again, I am inclined to believe this statistic. My own personal experience tells me this is true. Consider:
- I was in Recife, Brazil, about a year ago at this time. Every street vendor at a farmer’s market selling cheese, vegetables, meat, and fish accepted electronic payments.
- I was in Chengdu, China, attending a technology conference. While there, I bought stuffed panda bears for my granddaughter and whirly, light-up flying things for my grandson. All the street vendors there accepted electronic payments.
- I live in Omaha, NE. My plumber came to my house to fix my faucet after placing the order online and paid online.
SMBs Need Enterprise IT Capabilities
These small businesses are only a representative sample of how dependent SMBs around the globe are on technology to operate. These SMBs do not have in-house IT staff to support them. Yet every one of them needs backend enterprise IT capabilities to operate in today’s world.
So, wherever Kaseya got its startling statistics about SMBs, count me as one who is inclined to believe them. These statistics reinforce what I see and experience, not just in the US, but around the world.
Stay tuned for further blog entries from my time here in Miami, as I attend further keynotes, meet with exhibitors, and have 1:1 time with Kaseya executives.
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