Barracuda Networks has signed a definitive agreement to buy SKOUT Cybersecurity, a provider of outsourced cybersecurity services for MSPs.
Terms of the transaction were not disclosed.
The deal, which is expected to close later this month, will allow Barracuda to add an eXtended detection and response (XDR) solution backed by a 24×7 security operations center to its current lineup of security services for MSPs.
“We can basically take our security technologies, the XDR, and the SOC, and have a really cool offering that MSPs can use for their customers,” says Neal Bradbury, vice president of MSP strategic partnerships for the vendor’s Barracuda MSP unit.
Unlike endpoint detection and response (EDR) solutions, which act on input from workstations and servers only, XDR products pool and correlate data from firewalls, email security systems, and other sources as well. According to Bradbury, MSPs need the more complete cybersecurity picture that results to keep customers safe amid proliferating threats.
“They’re doing endpoint security. They’re doing email security. They may be getting certain telemetry out of their RMM. How do they bring all of that together?” he asks. “How do they basically synthesize all those events across all the customers that they manage to know what’s important?”
SKOUT’s XDR solution arms MSPs to meet that need without investing millions in high-priced facilities and analysts. “Not every MSP can go in and build a SOC that runs 24×7,” Bradbury observes.
Barracuda, which is owned by deep-pocketed private equity firm Thoma Bravo, does have the resources to build a SOC, but saw acquiring an XDR vendor with a fully-staffed SOC as a way to speed its time to market. SKOUT in particular, Bradbury notes, is an MSP-focused XDR vendor with a multitenant platform.
Though not ready to discuss timelines yet, Barracuda plans to integrate its email and network security solutions for MSPs with SKOUT’s XDR offering. SKOUT will continue to support solutions in those and other categories from additional vendors too, as it does today.
“We’re not taking SKOUT, acquiring it, and then saying, ‘you can only have Barracuda solutions integrated,'” Bradbury explains. “We realize that MSP customers and MSPs may have different security products that they layered on to protect themselves.”
In general, he continues, the future will be “business as usual” for SKOUT’s current partners. Barracuda may eventually merge SKOUT’s partner program with its own, but until then the biggest change SKOUT users are likely to experience is the ability to add products from Barracuda to the mix of systems they incorporate in XDR services.
“It gives them a greater range of solutions that they can offer either to themselves or also to their customers,” Bradbury says.
SKOUT’s SOC isn’t Barracuda MSP’s first service offering. The company already provides optional NOC and help desk services to users of its RMM solution. Nearly 60% of MSPs polled by Barracuda earlier this year said they expect services to account for 50% or more of their revenues in 2021.
Barracuda rival ConnectWise similarly offers NOC and help desk services to users of its ConnectWise Command RMM solution, along with SOC services acquired through its 2019 purchase of Continuum and 2020 purchase of Perch Security and StratoZen.
Fully 93% of businesses surveyed by Enterprise Strategy Group last year were planning an XDR investment in the next 12 months, and 38% expected XDR to provide a centralized hub for security operations.
Numbers like those were a key force behind EDR/XDR vendor SentinelOne’s record-setting IPO this week, and have many other vendors rolling out or augmenting XDR products. Fortinet, for example, introduced an XDR solution with automated artificial intelligence technology in January. Trend Micro shipped enhancements to its XDR solution in February and June.
SKOUT is Barracuda’s second significant acquisition in the last year. The company bought zero-trust network access vendor Fyde seven months ago, and released an MSP edition of software based on Fyde’s technology in March.
