‘Don’t Confuse Small With Weak:’ N-able CEO John Pagliuca On Servicing The Midmarket

N-able’s CEO talks about selling business outcomes instead of products, his plan to be all-channel going forward, and why his hallmark of the past 25 years has been helping companies get to scale.

N-able CEO John Pagliuca spoke with The Channel Company Chief Content Officer Stuart Sumner at the 2025 XChange Best of Breed conference in Atlanta on a wide range of issues, including the company’s use of AI internally and externally, whether he always wanted to be a CEO and the companies he’s taken lessons from along the way.

What’s top of your agenda right now?

It’s making sure that we deliver on the promise to be a best-in-class solution. In 2026 we’re hoping to elevate the message so that when IT professionals are talking to their stakeholders, they’re talking to them about business outcomes.

We’re making sure that we can give them an end-to-end solution that can provide business resilience. I think the industry’s grown out of talking about solutions like email security, backup, DNS filtering, firewall—it just gets lost in the noise.

When you talk about outcomes, how much of that is a message to your sales teams in terms of selling outcomes, not products?

One of the more important things as CEO is clear alignment. The thing I talk to Wall Street about has to be the same thing that I talk to my board and my employees about. It has to be the same exact message to my partners in the channel and end customers. It’s all about the customer outcome.

I tell my sales team you’re not selling—it’s more of a transferring of excitement in business know-how from one person to the other. And our job is to be shepherds for the midmarket and the small-to-medium enterprise and make sure that they’re armed with the knowledge so that they know they need a layered security approach.

They need to think about business resiliency and go from there. I was in Italy last week speaking to MSPs up and down the peninsula, and the feedback was customers don’t want to hear about threat hunting. They don’t want to hear about [having] to pay more for a different piece of security or backup software. I said, ‘You’re having the wrong conversation with them. You shouldn’t be talking to them about the ingredients. You need to be talking to them about the business outcome.’

What’s your revenue split between channel and direct, and is it where you want it to be?

We’re at about 85 percent channel and about 15 percent direct.

The way we think about our goals is more split between MSP and midmarket. So that’s probably better said to be 85 percent channel and 15 percent midmarket. I expect that to shift to probably about 75 percent/25 percent in the medium term. And in 2026, for that 25 percent of the mid-market, that’s also going to be channel. There’s a big convergence going on in the space. There are MSPs, there are VARs, there are systems integrators, and then there are all three. So we’re trying to have the conversation and build relationships with the VARs and the systems integrators that are servicing the midmarket. So we actually plan to be completely channel as we go forward, and we’re really now trying to access the midmarket via these larger systems integrators and VARs that are more focused on midmarket.

This article originally appeared on our sister site CRN.

How are you using AI internally and externally?

We look at AI from a couple of different dimensions. One, we want to make sure that our employees are leveraging AI responsibly so that they can be more productive. And so we have an initiative internally where we’re focused on the processes and the data to make all of the teams more productive. Not to reduce the workforce, but so that our workforce can have more of a human interaction. I think that’s one of the misgivings that’s going on with AI. So, as an example, my sales team can spend less time dealing with their forecasts or taking notes and more time with customers to transfer that excitement that I was talking about earlier.

The second element of it is what we build with AI. So my developers leverage AI to develop code because it’s more efficient and more secure. They can run vulnerability testing as they’re running the code.

And then, we’re also helping our MSPs, so we have AI in all of our products. We have machine learning in our email security offering. We’re leveraging AI and our endpoint management. Over 70 percent of all of threats are now detected with a robot, so we’re able to respond quickly. What used to take hours is now taking minutes.

Do you think there’s an AI bubble?

If you’re familiar with the Gartner hype cycle, we’re probably right before the trough of disillusionment with AI. I think ‘bubble’ is the wrong categorization. I think there is an unfounded, unrealistic expectation of what AI can do. Once people understand the power of AI, there will be a reset of expectations and we’ll go up the slope of enlightenment and there’ll be a productivity gain. A bubble implies that there’ll be a burst. People need to understand that there’s fundamentally two layers that need to happen before you can have AI generate productivity at scale. Your data needs to be cleaned and your processes need to be understood. AI is effectively a layer on top. And if the data is not clean and the processes are not understood, well, garbage in, garbage out. And so I think that’s probably a little bit of the misalignment. And that’s as true for MSPs as it is for the Fortune 1000.

Before you gain the leapfrogs in innovation and efficiency, you need to do the hard work. At many organizations, their data is in pockets, in shadow IT. And it’s not necessarily clean or logged correctly, and processes are even less optimal.

The one part I do think that has been overblown is this view that the skilled workforce will go down by 30 percent. I think just like the rest of the major technological advances in our history, it’ll reshape the workforce. It’ll continue to reshape the workforce, and people will adjust and adapt, as we always do.

And then the workforce will be better for it and have more human interaction for it. I think this will usher in a new era of human interaction as opposed to sitting behind the desk, banging on a keyboard and trying to build some code. It will create more time for humans to have a richer human interaction.

What keeps you up at night?

We know that small/medium enterprise is in the crosshairs of the threat actors, and we know that they’re getting more sophisticated. And if you if you zoom back out, we know that MSPs have the keys to small/medium enterprises. And if you zoom out further, we know that vendors [like] N-able hold the keys to the MSPs. So if you want access to the keys, we know that we’re at risk. So one of the things is making sure that my employees show up every day with the responsibility and the privilege to make sure that we’re protecting 600,000 small to medium businesses across the globe. It’s a responsibility, a pressure on our shoulders, but it’s an absolute privilege.

No. 2, there’s that famous quote that says the rate of change in technology is the fastest that’s ever been in our life, and it’s the slowest that it will ever be in our future. And as a technology leader and a CEO, I want to make sure that my team, my partners, my customers, are best positioned to win in this ever-evolving space.

I fought the term ‘digital transformation’ for years, and I think AI’s proving that I was right. It’s not a transformation; you don’t go from caterpillar to butterfly. It’s an evolution that’s ongoing and does not stop. And so positioning us and our customers to not just adapt but thrive in the ever-changing landscape is also heavily on my mind.

What would you describe as your biggest mistake as a CEO?

I’ve been CEO for four years, and I’m proud of a lot of the things that we’ve accomplished—over $500 million of ARR [annual recurring revenue], we’re a profitable business, we did this fantastic acquisition of Adlumin. Where I think we could have done better is in some of our international expansion. N-able has over 40 percent of our revenue in international, and that was partly based on our heritage. We are by our roots Canadian, Scottish and Dutch, so that gave us this unnatural advantage in those markets. And one of the things that I look at now is there’s an untapped opportunity still in well-defined markets that we all know, and I think we could have done a better job, and we will do a better job leading there.

Did you grow up wanting to be a CEO?

It was definitely by accident. I love helping companies get to scale, and that’s been my hallmark for the past 25 years. I got into tech because I saw companies going from an idea to $100 million to $500 million really quickly. And that that growth just gave me goosebumps, and it fuels me.

I used my finance acumen and my business and financial modeling skills to help companies get to scale profitably. I believe software companies should be profitable. And so I navigated the path through finance leadership and became a CFO and found my way to N-able. Really, I stumbled into the channel and fell in love with it because I’m speaking to business owners every day. Whether they’re a systems integrator or an MSP or a midmarket company, I’m floored every day by their level of sophistication and their ingenuity.

So I get to listen to these guys talking about their business model every day, and then I help them try to get to scale. So it’s been a blessing and a perfect fit.

When I was a CFO a couple of folks said, ‘Hey, we think you should run this business,’ and I didn’t really apply for it. I was recommended, and I was humbled by that. I like to think they see me as someone to put ‘we’ before ‘me.’ I think the best leaders do that and drive to inspire not just their team but the broader stakeholders.

I’m a soccer guy. I would coach my kids’ teams and I recognized early on that a team is only as strong as the weakest link. I like to bring that to my teams at N-able every day. And I think if you’re part of a team and feel that the leadership believes in ‘we’ before ‘me’ and continues to put the greater good and the mission ahead of everything else, you want to come to work and work harder.

I feel like everyone stumbles into the channel and falls in love with it. I think that’s a really interesting way to put it.

I always say, ‘Don’t confuse small with weak.’ And so I speak to Wall Street, and Wall Street says, ‘John, what happened with COVID? The small medium enterprises, they’re going to get killed.’ I said, ‘No, you’re confusing small with weak.’ It may be a $10 million or $5 million organization, but they know their business. They don’t have fat in their workforce. And in downturns, they can navigate, like a small boat, much better than an aircraft carrier. I would put a CEO or a business leader of a small/medium enterprise of these MSPs up against a Fortune 1000 C-suite executive. These are strong businesspeople, and they’ve built great businesses that will help generations to come and their families. When I sit and meet with MSPs, it’s father, daughter, granddaughter, right? It’s like three generations of these MSPs, and they’ve built something that can stand generations.

As a CEO, are there any companies you look at and admire and take lessons from?

We’re approaching 2,000 employees and we’ve been around for 20 years. How do you keep that flame of innovation going for decades and at scale while driving a crystal-clear alignment?

What Satya Nadella does at Microsoft is nothing short of remarkable, and they continue to produce innovation from Azure to Xbox to M365 and Copilot.

The other one, historically, has been at Atlassian in that they put the product first and they know their customer and their personas. As a result, they don’t need to spend that much on sales or marketing. If you look at their business model, they found the truth that if you put delight in the customer’s hand, the rest will take care of itself.

My dad had a small construction company in Italy, and he never advertised. His product was so good that regardless of the economy he always had a backlog of business. And it taught me that sales is important, distribution and channels are important, but it starts with the right quality relationship and the right quality product. The two companies I’ve mentioned deliver the right quality product.