Joe Smolarski, CEO of WatchGuard Technologies, joins the podcast for a wide-ranging conversation about why the company believes 2026 is “the year of the cybersecurity-focused MSP” – and what that actually means beyond the tagline. Smolarski came to WatchGuard in November after nearly a decade at Kaseya, where he served as president and COO. He’s been open about applying what he calls the “Kaseya playbook” to WatchGuard – driving down platform costs and consolidating tools to improve partner margins. In this conversation, we dig into what parts of that playbook he’s bringing, what he’s leaving behind, and why he believes WatchGuard can double MSP margins on cybersecurity. We also explore WatchGuard’s latest threat research, which showed a 1,500% spike in unique endpoint malware, and what the company’s 2026 predictions – including the first fully autonomous AI-executed cyberattack and the extinction of crypto-ransomware – mean practically for MSPs and the customers they protect. The conversation takes a Canadian lens as well. Smolarski discusses WatchGuard’s new partnership with Bell Cyber, the data sovereignty investments required to win that deal, and why he sees the Canadian market as ripe for its next level of MSP maturity – driven by regulation like Bill C-26 and the consolidation wave now reaching this side of the border. We also touch on WatchGuard’s 30th anniversary, what longevity means in a market full of startups and PE roll-ups, and how Vector Capital’s decades-long involvement shapes the company’s outlook. Read Full Transcript Robert Dutt: Hello and welcome to In The Channel from ChannelBuzz.ca, bringing news and information to the Canadian IT channel community for the last 16 years. I’m Robert Dutt, editor of ChannelBuzz.ca and your host for the show. My guest this week is Joe Smolarski, the CEO of WatchGuard Technologies. Joe took the helm at WatchGuard back in November after spending nearly a decade at Kaseya, where he served as president and COO. He’s now leading a company that just celebrated its 30th anniversary, has been 100% channel-focused since day one, and is making a pretty bold claim that 2026 is the year of the cybersecurity-focused MSP. Now, that’s the kind of line that can sound like vendor marketing if you’re not careful, so I wanted to dig into what’s actually behind it. We talked about the explosion in endpoint malware, why the shift from ransomware to pure data extortion changes the game for MSPs, what Joe is bringing from his Kaseya experience and what he’s leaving behind, and why he thinks Canadian MSPs are at a tipping point. We also get into the economics of it all – his promise to double MSP margins on cybersecurity, and how WatchGuard’s platform play is supposed to make that math work. Let’s get right into it. My chat with Joe Smolarski. Thanks for taking the time, I appreciate it. Joe Smolarski: My pleasure, Rob. Robert Dutt: Security has been one of the biggest, maybe the biggest, growth driver for MSPs for years, and your company is saying that 2026 is the year of the cybersecurity-focused MSP. Help me understand what makes this year different from the last three or four, where people have been seeing the same kind of momentum in security in the MSP space. Joe Smolarski: Yeah, sure, Rob. I think ultimately many of the stats are clear, and they’re really eye-opening. I think no longer are MSPs having to educate and evangelize why it’s needed, because when you see eye-popping stats like the fact that cybercrime is the third largest GDP in the world behind the US and China, it’s like, holy cow, how the heck is that possible? But it’s escalated very, very quickly. And unfortunately for SMBs, SMBs have become the focus of those attacks, and I think that’s becoming clearer and clearer every day. SMBs used to feel as though they’re not the focus, that the big guys will be the focus. But what we’ve seen – and unfortunately I have some firsthand experience – is that when cybercriminals attack the big guys, they have people come after them. If you know my past, I served as president and COO of Kaseya for nearly a decade prior to becoming CEO at WatchGuard. And there, on July 2nd of 2021, we got attacked by Russian cybercriminals. When that occurred, within four hours I had the FBI and the White House and Department of Homeland Security and everybody else in my office, which was not very pleasant. So you get the attention when you’re a major provider, a big company. Look at Stryker right now, what they’re going through. In that situation, within four hours, they’re all in my office. Within three weeks, we got the bad guys, and those bad guys are sitting in a federal prison right now. But that’s not the case when it comes to SMBs, and it’s a shame. I had access to a bunch of inside information within the government when we went through that, because we also hired the FBI lead as our CISO at that time. And what they say is they’re just overwhelmed. There’s no way that they could get to all of the attacks that are occurring. The big guys get attention and the small guys don’t, and that’s become prevalent. So I think ultimately, this is the year for cybersecurity to get to that next level because the pace of attacks is picking up so much, in particular in the SMB market. We posted our bi-annual security report and showed a 1,500% increase over the last year, just in the velocity of attacks, which is scary. It’s scary for SMBs. And quite frankly, even if they have some of their own internal IT staff, they’re not going to be at the level that they require to stay protected. So they’re relying on the fantastic MSPs that are out there to get them to that next level. I will say, I caught up with three or four large MSPs in Canada over the last week, just to prepare for this a little bit, just to get some of the latest trends directly from the MSPs themselves. And they said they still feel like Canada is a little bit behind when it comes to the US, just a little bit behind in terms of education and things like that. And certainly, small business is so prevalent in Canada, given how dispersed it is. So they’re working on that. I know your government in Canada is working to increase regulation. I think some of the fighting back and forth with Trump and Carney has been interesting and ultimately fueling the Buy Canadian campaigns and some of that stuff. But you’ve got a lot going on. I know you’ve got a C-26 bill from an infrastructure perspective trying to be passed, just to make sure that the awareness is there for all businesses on what needs to be protected – supply chain and everything else. But it’s a huge opportunity for the MSP market to take it to that next level, because from my perspective, Rob, you have to. What I’ve seen – and this is very, very unfair – is that when a small business even declines that next level of, say, platinum service from an MSP, they’re like, “I don’t need that. We don’t need that level of protection. We’re not willing to pay that amount.” If something negative happens, then unfortunately the MSP still gets blamed. And that’s ridiculous, but it’s the reality of the situation. So this is the year to capitalize on it. There’s enough news and information out there that supports everything. It’s an exciting year and, of course, a nervous year, because you’ve got to protect your clients and use the best technology and services to get there. Robert Dutt: You touch on the 1,500% spike in endpoint malware in the second half. A quarter of those attacks are evading signature-based detection. At the same time, though, your team is predicting that crypto-ransomware is essentially going extinct this year as attackers say, “You know what? We’d rather just steal the data and extort you.” What does that shift mean practically for how MSPs need to think about protection and what they’ve been offering, given that ransomware has been such a driver for the last half decade or so? Joe Smolarski: Yeah, I think ultimately you just have to make sure that you have layers of protection. To your point, lots of things get through. You could have the very best technology in the world, whether that’s WatchGuard or some of the other leading providers, and things can get through. Ultimately, that’s why you need the layers. One of the things that you should also consider is the platform approach. There are many providers, WatchGuard being one of the leading providers in the MSP space. When you have a platform that gives you multiple layers and those layers get to be correlated together, it just increases your chances of detecting those things. You may see something on the firewall that’s not definitive evidence of something happening, but when you piece that together with what’s happening on the endpoint and you’ve got those two data points, you piece it together faster than point solutions can. I think ultimately you need to make sure you have 24/7 SOC monitoring. Things that you didn’t think were possible – you thought you put in the best products to protect you, why do I need that, nothing should get through. You just threw the stats out there that things do get through. The only way to stop that is to catch those anomalies at one of the respective layers. If you’re at 99.9999%, you’ll get it at the product level. But what gets through – and with the velocity of attacks that is there – you’ve got to make sure you’ve got AI-based SOC solutions and MDR solutions backed up by great security professionals to ensure you’re protected. Robert Dutt: On the AI tip, you guys have predicted the first fully autonomous, end-to-end executed-by-AI cyberattack this year. That’s a big call. What would that look like? And how do I, as a mid-market MSP, even begin to prepare for something like that? Joe Smol