Datto never sold to the businesses that used it. A dentist's office or a small law firm rarely had its own IT staff, so it hired a local managed service provider to run its computers. Datto sold backup and recovery tools to those providers, and they resold Datto to thousands of small clients. By its October 2020 IPO, Datto was owned mostly by Vista Equity Partners, and remote work had made small business IT more urgent than ever.

Finding the MSP Channel

Austin McChord founded Datto in 2007 in Connecticut. His idea was to give small and midsize businesses the kind of backup and recovery that only big companies could afford. Datto's boxes copied a client's servers and could run them from the backup if the originals failed. The key move was the sales channel. Datto sold only through managed service providers, the small IT firms that look after offices on contract, and it added software to help them run their whole businesses.

Twenty-Seven Dollars, Then Kaseya

Datto priced its IPO at $27 a share in October 2020 and listed on the New York Stock Exchange as MSP. It sold 22 million shares and used much of the money to pay down debt. After the offering, Vista still owned about 72 percent of the company. Less than two years later, in April 2022, Kaseya agreed to buy Datto. The deal closed in June 2022 at $35.50 a share in cash, and Datto left the exchange.

Cover: The Pairs of Animals Entering the Ark, Hans Bol. Art Institute of Chicago, public domain. Chosen for pairs of animals entering the ark (two copies of everything).