John Pagliuca: So the beauty of our model and what I’d want to remind everyone is that we’re a sell-to but also a sell-through. And what I mean by that is whether it be endpoint security or data protection, our MSPs sometimes are faced with, in their customer base, managing 2, 3, 6, 10 different backup offerings, right? And so one of the big bits that we preach here at N-able is how our MSPs can standardize on a particular technology stack because that drives a bunch of efficiency from a software cost, but also from a labor cost. And that’s typically the long pull, right, is that they’ll need to go through some of their customers and standardize and flip their backup offering or flip their endpoint security offering. And I’d say our largest more mature, the upper decile MSPs, maybe the upper quartile MSPs, do that a little bit more of an ease in some of our smaller shops.
The smaller shops are a little reticent to go do that and that takes a lot more time. So in the majority of the logos and that bottom 75% quartile, it takes time for them to standardize through their base. And that — so we could win an account, we can win with Cove. But it only might reflect 5% of the MSPs estate and getting that MSP to push through to their entire SMB base to realize the efficiencies gained just it’s a little bit more of a journey, it’s a little bit of education, and it requires the MSP to push through. So I’d say that’s what takes the longest time. And what we really try to help them do is to automate that and push through that standardization process.
Brian Essex: Very helpful clarity, thank you for that. And thanks for taking the question.
Operator: Our final question today comes from Jason Ader with William Blair. Your line is open. Please go ahead.
Jason Ader: Yes, thanks, good morning guys. I want to just ask on the device commentary. I know you talked about pressure on device additions, but wondering if there’s any pricing pressure in terms of the RMM kind of per device cost. I know that there’s been competitors out there that have tried to use RMM as kind of a loss leader and just whether that’s having an impact as well?
John Pagliuca: Sure. Jason, thanks for the call, and thanks for the question. That’s the beauty of the expansion of the white space opportunity, Jason. So with the ability now from — again, from go into that low 20s to 30s, it gives us a little bit more play for the bundling and allowing us to present really for an LTV for the MSP. I know a lot of folks have always asked, “Hey, can you disclose your RMM revenue versus your backup revenue.” As a business, as a leadership team, we really focus on the LTV of the customer. And so if that means incentivizing them on a particular SKU like RMM so that we can get our endpoint security and data protection SKU one from a customer point of view. A bigger white space opportunity allows us a little bit more freedom and a little bit more creative bundling.
So that’s one point. The expansion allows us a little bit more freedom on the bundling. The second point we mentioned on what we’re focused on 2024 is around some of these committed contracts. And what we’re doing that’s somewhat different than we did last year is we’re really giving MSPs a choice. And we’re saying, “Hey, look, in exchange for a committed contract, there’s a potential to get better economic terms for you, but in exchange, we want that long-term commitment.” And what we’re finding is the MSPs prefer — they prefer the choice there, and it’s helping them lock in the economics long term, which will give us much better visibility into our customer retention and allow us to focus on that white space opportunity. So that’s what we’re looking to do as it relates to some of the initiatives there for 2024.
Jason Ader: Got you. Okay. So you didn’t exactly answer my question, but I think I get it. I mean it’s — is it fair to say that there actually has been some broader sort of market pressure on pricing, but that you’re not too worried about it just because of the other opportunities that you talked about and the ability to kind of leverage your position there?
John Pagliuca: Yes. So. No, no, no. It’s a fair follow-up. We’re winning in our RMM category, we’re winning — our Q4 is one of our strongest quarters as it relates to bookings and that NCA, that new customer acquisition and monitoring and management. So we’re winning there. I don’t really see a challenge on the price points for our RMM nodes. It’s more of the flexibility as to what the prize really is. Is the price the, we’ll call it, $2 to $3 on the monitoring and management node, or is the prize on the $30 on the entire estate when you add the data protection and security. So we’re trying to look at it a little bit more holistically. So I’m not seeing really a change in the market and an increase in competitive pricing on the node. No, we’re not.
Jason Ader: Okay. Okay. Good. And then just, Tim, on the January, February, we’re almost done with February now. I know you gave guidance for Q1, but any kind of commentary — color commentary on whether there’s any changes in the first couple of months of this year versus, let’s call it, the last three months of 2023? Demand-wise, anything to call out?
