How a $1,000 Synology NAS Completed Our Microsoft 365 Backup Strategy

We run a small company on Microsoft 365 - Exchange, OneDrive, SharePoint, Teams, the whole stack. We already had cloud backup in place. But cloud backup alone isn't a backup strategy.

The old rule still holds: 3-2-1. Three copies of your data, on two different media types, with one copy offsite. Cloud backup covers the offsite piece. But if you need to restore 50GB of OneDrive files after a ransomware incident, you're pulling that data over the internet at whatever speed your ISP allows. And if your cloud backup vendor has an outage - or decides to change pricing - you're exposed.

We needed a fast, local backup layer that we owned outright. Something that could restore a deleted mailbox in minutes, not hours, without depending on someone else's infrastructure.

That's where the Synology came in.

Why cloud backup alone isn't enough

Cloud backup services like Veeam, Acronis, and Datto are solid products. We still use one. But relying on cloud backup as your only layer has real limitations:

• Recovery speed: Restoring large amounts of data over the internet is slow. A full mailbox or OneDrive restore can take hours depending on your connection.
• Vendor dependency: If your backup provider has an outage, raises prices, or sunsets a product, your backup availability is in someone else's hands.
• Ongoing cost: Cloud backup runs $2–4/user/month. For a 25-person org, that's $600–$1,200/year - a legitimate expense, but one that never stops.
• Single point of failure: If both your M365 tenant and your cloud backup are compromised (same credentials, same attack vector), you have nothing to fall back on.

An on-site backup on hardware you control solves all of these. It's fast (LAN-speed restores), it's yours (no vendor lock-in), and after the initial hardware purchase, it costs nothing to operate.

The two layers complement each other: cloud backup for offsite disaster recovery, on-site NAS for fast day-to-day recovery. Together, they give you a real 3-2-1 strategy.

What Synology gives you for free

The Synology DS225+ runs DSM (DiskStation Manager), which includes a suite of backup applications at no additional cost:

• Active Backup for Microsoft 365 - backs up Exchange mailboxes, OneDrive, SharePoint, and Teams data. Scheduled, automatic, granular recovery down to individual emails or files. No per-user licensing.
• Hyper Backup - backs up the NAS itself to an external drive, another NAS, or cloud storage (S3, Azure Blob, Backblaze B2) for offsite redundancy.
• Snapshot Replication - point-in-time snapshots on Btrfs volumes with immutable WORM protection against ransomware.
• Synology Drive - file sync and sharing across devices if you want to replace or supplement OneDrive for local workflows.

Active Backup for Microsoft 365 is the headliner. It supports:

• Exchange Online (mailboxes and archives)
• OneDrive for Business
• SharePoint Online (sites, lists, document libraries)
• Microsoft Teams (channel content stored in SharePoint)
• Granular restore - search and recover individual emails, files, or entire mailboxes
• Self-service recovery portal via Azure AD integration
• Block-level deduplication on Btrfs to minimize storage usage
• Configurable retention policies with immutable snapshots

No license keys. No per-seat fees. No maximum account limits. You own the NAS, you run the software.

Our setup: what it cost

Item	Cost
Synology DS225+ (diskless)	~$340
2x Seagate IronWolf 12TB drives	~$660 ($330 each)
Total	~$1,000

Synology DS225+ 2-Bay NASCheck Current Pricevia Amazon

View Deal

Seagate IronWolf 12TB NAS DriveCheck Current Pricevia Amazon

View Deal

With two 12TB drives in Synology Hybrid RAID (SHR), you get roughly 12TB of usable storage with single-drive fault tolerance. If a drive fails, you swap it out and the array rebuilds. No data loss.

Compare that to other on-premise backup solutions that require per-seat or per-server licensing on top of the hardware. With Synology, the software is included. The NAS pays for itself by avoiding those licensing fees, and then runs for 5–7+ years with no recurring costs beyond electricity (~$15–20/year).

How much storage do you actually need?

The right drive size depends on what you're backing up and how many users you have. Here's a practical framework:

Estimate your M365 data:

• Exchange mailbox: Microsoft gives each user 50–100GB. In practice, most SMB mailboxes use 2–10GB. Use 5GB as a realistic average.
• OneDrive: Each user gets 1TB. Actual usage varies wildly - power users with large files might use 50–100GB, while most use under 10GB. Use 15GB as a middle estimate.
• SharePoint: Shared storage for the tenant. Typically 1TB base + 10GB per licensed user. Actual usage is usually a fraction of this.

Rough per-user estimate: ~20GB per user for mailbox + OneDrive data.

Deduplication savings: Synology's Active Backup uses block-level deduplication and single-instancing on Btrfs volumes. Shared files in OneDrive and SharePoint are stored once. Expect 30–50% storage reduction depending on how much duplicate content exists across users.

Retention multiplier: If you keep 30 days of versioned backups, storage grows modestly since only changed blocks are stored after the initial full backup.

Quick sizing guide

Users	Estimated Raw Data	After Dedup (~40%)	Recommended Drives
5–15	100–300 GB	60–180 GB	2x 4TB (plenty of room)
15–30	300–600 GB	180–360 GB	2x 4TB or 2x 8TB
30–50	600 GB–1 TB	360–600 GB	2x 8TB
50–100	1–2 TB	600 GB–1.2 TB	2x 8TB or 2x 12TB
100+	2+ TB	1.2+ TB	2x 12TB+ or upgrade to a 4-bay NAS

If the NAS is also your file server or you're backing up other systems (PCs, servers, other SaaS apps via Active Backup for Business), size up. Storage is cheap compared to the NAS itself - a 12TB IronWolf runs about $330 and gives you years of headroom.

When in doubt, go bigger. You can't easily downsize drives, but you can always use extra space for Hyper Backup archives, surveillance footage, or shared file storage.

Setting it up

The full setup takes about an hour. No IT degree required.

1. Hardware

Slide two drives into the DS225+ (tool-less trays), plug in power and Ethernet, and power it on. Open find.synology.com in a browser to run through the DSM setup wizard. Choose SHR (Synology Hybrid RAID) and Btrfs file system when prompted - both are required for Active Backup's deduplication and snapshot features.

2. Install Active Backup for Microsoft 365

Open Package Center in DSM and install Active Backup for Microsoft 365. It's free - no license key, no activation.

3. Connect to your M365 tenant

The setup wizard walks you through authenticating with your Microsoft 365 Global Admin account (or you can configure app-only access with more granular permissions). You'll authorize the Synology app in Azure AD to read your tenant's mail, files, and sites.

4. Configure backup tasks

Select which services to back up (Exchange, OneDrive, SharePoint, Teams), set your schedule (we run ours every 6 hours), and configure retention. That's it - backups start running automatically.

5. Pair with your existing cloud backup

If you already have cloud backup (Veeam, Acronis, Datto, etc.), you now have a proper 3-2-1 setup: the NAS provides fast local recovery, and your cloud backup covers offsite disaster recovery. You can also use Hyper Backup to replicate the NAS data to a second location - another Synology at a different site, a USB drive stored offsite, or a cloud target like Backblaze B2 (~$5/TB/month) - for even more redundancy.

What recovery looks like

When someone deletes an email from six months ago or ransomware encrypts a SharePoint site, you open Active Backup for Microsoft 365 in DSM and:

1. Search for the user, mailbox, or site
2. Browse the backup timeline and select a restore point
3. Preview the content before restoring
4. Restore in place or export to a local file (EML, PST, or original format)

Individual email recovery takes seconds. Full mailbox restores take minutes. You can also set up a self-service portal so users can recover their own deleted files without involving IT.

It's not just Microsoft 365

We use this NAS for M365 backup, but Synology's free backup suite covers far more than that. Once the hardware is in place, you can protect virtually everything your business runs on - no additional licenses for any of it.

Google Workspace

Active Backup for Google Workspace does for Google what Active Backup for M365 does for Microsoft:

• Gmail - full mailbox backup with labels and attachments
• Google Drive - My Drive, shared drives, and file permissions
• Contacts and Calendar - including event attachments
• Google Docs, Sheets, Slides, and Forms are automatically exported to standard formats (DOCX, XLSX, PPTX) during backup

If your org runs on Google instead of Microsoft, the same NAS and the same approach applies.

PCs, servers, and VMs

Active Backup for Business extends backup to your on-premise infrastructure:

• Windows and Mac endpoints - agent-based backup of employee workstations with centralized management
• File servers - SMB and rsync file server backup
• VMware vSphere and Hyper-V - agentless VM backup with instant restore capability. Spin up a failed VM directly on the NAS while you recover the production host.
• Linux physical servers - bare-metal backup and restore

All managed from the same DSM dashboard, all using the same deduplication and immutable snapshot technology, all license-free.

One NAS, multiple jobs

This is what makes the Synology investment compelling beyond any single use case. A $1,000 NAS that backs up your M365 tenant today can also back up your Google Workspace accounts, your team's laptops, your on-site file server, and your Hyper-V VMs - all without buying a single additional license. Try doing that with Veeam or Acronis without a calculator and a procurement meeting.

Why you still need cloud backup too

A NAS is not a replacement for offsite backup. It's a complement to it.

• If your office floods, burns, or gets robbed, the NAS goes with it. Cloud backup is your disaster recovery layer.
• If ransomware hits your network, a NAS connected to the LAN could be a target. Cloud backup stored outside your network perimeter is your last line of defense. (Synology's immutable snapshots help here, but defense in depth is the point.)
• If you have multiple locations, cloud backup is accessible from anywhere. A NAS is site-specific.

The right answer is both. Cloud backup for the worst-case scenarios. On-site NAS for the everyday ones - the accidentally deleted email, the overwritten SharePoint document, the user who cleared their OneDrive. Those recoveries happen ten times more often than disasters, and having them take seconds instead of hours is worth the hardware investment.

Why the DS225+ specifically

The DS225+ is Synology's current-generation 2-bay Plus-series NAS. The Plus series matters because Active Backup requires an x64 Intel CPU and Btrfs support - the budget J-series and Value-series NAS units don't qualify.

Key specs that make it a fit:

• Intel Celeron J4125 (4-core, 2.0–2.7 GHz) - handles backup tasks and deduplication without breaking a sweat
• 2GB DDR4 RAM (expandable to 6GB) - sufficient for backup workloads; upgrade if you plan to run additional packages
• 2.5GbE + 1GbE networking - faster than standard gigabit for initial backup seeding
• Hot-swappable drive bays - replace a failed drive without powering down
• 19.6 dB(A) noise level - quiet enough to sit under a desk or in a closet
• ~17W power draw - runs 24/7 for roughly $15–20/year in electricity
• 3-year warranty, extendable to 5 years

Synology DS225+ - 2-Bay NAS for M365 BackupCheck Current Pricevia Amazon

View Deal

Why IronWolf drives

Seagate IronWolf drives are purpose-built for NAS environments - CMR recording, vibration tolerance, IronWolf Health Management (integrated with Synology DSM), and a workload rating of 180 TB/year. The 12TB model hits the price-to-capacity sweet spot at roughly $27.50/TB.

They're the most commonly recommended drive for Synology units, and Synology's own compatibility list includes them. The 12TB size gives plenty of headroom for M365 backup with room to grow.

Seagate IronWolf 12TB - NAS Hard DriveCheck Current Pricevia Amazon

View Deal

Bottom line

A good backup strategy has layers. Cloud backup gives you offsite disaster recovery. An on-site NAS gives you fast, local recovery for the problems that actually happen every week - deleted emails, overwritten files, accidental SharePoint changes.

Synology makes the on-site layer remarkably easy for an SMB. No backup software licenses, no per-user fees, no vendor lock-in. A one-time ~$1,000 hardware investment that quietly protects your entire M365 tenant for years.

Our DS225+ backs up our full tenant every 6 hours alongside our existing cloud backup. Two layers, two different failure modes covered, one less thing to worry about.

If you're also setting up remote employees, check out the WFH workstation stack we ship to every remote hire for under $600 - everything ships from Amazon and sets up without IT on-site.