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Crosby’s "Profit from the Cloud" presentation will specifically address important questions asked by those in the industry while providing some insight into creating and building a high growth ...

Crosby’s "Profit from the Cloud" presentation will specifically address important questions asked by those in the industry while providing some insight into creating and building a high growth hosting company.



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AskLance AskLance Presentation Transcript

  • Parallels Summit: Innovate, Optimize, Grow
    Feb ‘10
    Lance Crosby, CEO
    SoftLayer® Technologies
  • Access the presentation on:
  • Innovate, Optimize, Grow
    A quick look at the last 12 months in the hosting industry.
    The worst recession and economic collapse in history.
    Changed our offerings, pricing, and business models to meet market needs.
    Brought many new products to market, including leading the charge into cloud services.
    As individual companies and as an industry we have excelled in a time of panic.
  • Innovate, Optimize, Grow
    So, what does the future hold?
    If you can’t be good at everything, what should you be good at?
    90% of all servers sold are NOT hosted!! Stop competing against each other.
    How can we (as individuals and an industry) stay ahead of the market and increase awareness?
    How do I scale my business to take advantage of the opportunity in the market?
  • SoftLayer® Value Statement
    SoftLayer Delivers Innovative World Class, On-demand, Infrastructure Services.
    We lead the industry, bringing solutions to market before others realize the need for them.
    We push complete control to the end user to create the virtual data center experience.
    We automate every single facet of the data center environment to bring efficiency and standardization.
    We bring together hardware, software, security, networking, and storage in a single easy to use on-demand service.
  • SoftLayer® Difference
    Automated Services and Standardized Solutions
    Customer-controlled, automated management of core functions including OS installs and reloads, reboots, software installs, network management, monitoring, load balancing, firewall management, and more.
    Industry-Leading Customer Portal and Open API
    Direct access to more than 150 backend systems and activities, executed without any human intermediation. Mature API – over 1500 and growing
    Industry Exclusive Private Network
    Server-to-server communication, out-of-band management, and unlimited data transfer via VPN over dedicated carriers segregated from our Public Network.
    Integrated Geographical Diversity
    Three data centers connected via private, 10G point-to-point connections, and integrated through proprietary automated tools. Customers Choose
    True Virtual Data Center Services
    Innovative infrastructure, solutions, and automation capabilities provide unique advantages for virtualized solutions and a truly virtual data center.
  • Innovate: Fully Integrated Environments
    SoftLayer Provides the Only Completely Integrated Solution in the Industry.
    Dedicated servers, virtualized environments, and cloud solutions all operate together seamlessly to create an on-demand solution that can be scaled in real time.
  • Optimize: Automation is the Key
    The Physical Server is the Fundamental Building Block to All Technologies.
  • Grow: AKA SoftLayer® History
  • Results: After 4 Years of Operations…
    • $52 million in revenue for 2008
    • $83.5 million for 2009
    • $110 million annualized run rate (Feb 10)
    • $1M in annualized revenue added every 10 days
    • 175 employees
    Data Centers
    • Dallas: 18,500 square feet raised floor
    • Seattle: 15,000 square feet raised floor
    • Washington DC: 10,000 square feet raised floor
    • Capacity of 45,000 servers across current facilities
    • More than 5,800 in over 110 countries
    • More than 25,000 deployed servers
    • Average of 4 servers per customer
    • Revenue of ~$1,600 per customer
    • 300+ GB of connectivity
    • 8+ network providers and hundreds of peers
    • Sustained traffic of over 80Gbps
  • SoftLayer® 2009 Product Launches
    • CDN Enhancements
    • Cloud Storage
    • Native IPv6
    • SUSE O/S
    • SSD as Storage Option
    Q1 – 2009
    • Cloud Computing
    • Image Management
    • Storage Network
    • WAN Acceleration
    Q2 – 2009
    • SSL Certificates
    • API Enhancements
    • Evault Bare Metal Restores
    • NetScaler
    • WebsiteSpark (Microsoft)
    Q3 – 2009
    • Private and Bare Metal Cloud
    • Data Center Expansion in DAL, SEA, WDC
    Q4 – 2009
  • Our Plan to Innovate, Optimize & Grow
    • Accelerate new product launches
    • Enhance existing products with new features and capabilities
    • Drive automation across all business functions
    • The only way to scale is to eliminate redundant processes through automation
    • Bring all of our services closer to customers
    • Expand our geographical footprint
    • Network, network, network
  • SoftLayer® 2010 Product Roadmap
    Q1 – 2010
    • 2-Factor Authentication
    • XenServer Essentials
    • VMWare ESX
    • Cloudkick Integration
    • Data Center Expansion – San Jose, CA
    • Nationwide Network Expansion
    • VPN & DNS Geographic Expansion
    • Public API
    • Parallels Bare Metal Server
    • White Label Portal
    • Mobile Applications – iPhone, Android, BlackBerry
    Q2 – 2010
    • Automated Managed Services
    • Automated Colocation
    • AutoScaling Cloud
    • Portal Refresh
    Q3 – 2010
    • Cloud Appliances
    • PCI Compliance Services
    • Enterprise Software Integration
    • Data Center Expansion - Europe
    Q4 – 2010
  • Question / Answer
  • Ask Lance
    What’s the secret to building a high growth start-up?
    • Write your business plan
    • Create scalable systems
    • Diversify your personnel
    • Stop and look for mistakes
  • Ask Lance
    What’s going to happen to pricing in hosting?
    Will the current high margins in cloud turn hosting into
    into a commodity?
    • It’s too early to head into price competition
    • New market with lots of growth ahead
    • And it is critical to understand CapExvs Margin trade-offs
    • Understand the trade-off between building and buying your own cloud
  • With the Right Tools, Cloud Can Be Profitable
    Don’t Rush to Lower Prices – Rush to Raise Margins
    Dedicated Server
    $4,000 in fully loaded CapEx
    $300 in MRR
    13 month payback
    Cloud Server
    $1,200 in MRR
    5 month payback
    $6,000 in fully loaded CapEx
  • Ask Lance
    What’s the internal mantra at SoftLayer regarding
    • Challenging, but not overwhelming
  • Ask Lance
    How do you accurately guess what customers want?
    • Put yourself in the position of the customer and then build a menu that will satisfy that appetite.
    • Example…
  • Give the People What They Want
    Think Like a Customer.
  • Ask Lance
    • As hosting companies, we generate a lot of revenue from bandwidth. What’s the future of that as an offering?
    • Are you a telco? Or are you a hosting or managed services company?
    • We see bandwidth becoming both relevant and irrelevant in the next 24 months
    • Relevant… because customers will drive bandwidth requirements through the roof
    • Irrelevant… because it’s going to become the handle not the blade
  • Ready for “Free” Bandwidth?
    Addition of 7 PoPs and a New Data Center in San Jose
  • Ask Lance
    What’s the deal with IPv4 and IPv6?
    As a hosting company, should this concern me?
    • IPv4 is a limited resource and we are about to run out. Sometime in the next 12-24 months allocations will be reduced.
    • Shifting to IPv6 is possible, but it take planning and effort.
    • Why would you launch cloud without IPv6?
  • Ask Lance
    How do I scale my business to take advantage of the
    opportunity in the market?
    Is debt for capex a good idea?
    • 2010 looks to be a solid year. IT spending is rising. Projects are accelerating, but capex is still very limited
    • Build an opex oriented business and leverage partners to create scale
  • Ask Lance
    • Why do anything? I’ve built a good business over the past 10 years, so why change now?
    • Traditional hosting isn’t dead (yet)
    • The hype of cloud in late 2008 was turned into a reality by the collapse of the global economy
    • The pace of change in hosting has never been faster than what we will see in the next 24 months
  • Ask Lance
    How can small hosting companies stay ahead of the
    market and larger competitors?
    • Define your customers and strategic advantage and then focus on that
    • Smaller companies move faster than larger ones
    • Come together as an industry and work together
    • Our focus should be servers in closets not each other
  • Ask Lance
    As a business leader, how do you prepare for change
    that may be hard to predict?
    • Start with a great team and study everything around you.
    • And ask yourself how far ahead of the curve you want to be in delivering services
    • Trend-spotting is not easy and has high risk.
  • Ask Lance
    Is cloud for real?
    Or is this just another buzzword fad?
    • The word may change meaning, but the concept is here for good.
    • It doesn’t matter if you are an _aaS, a Grid, a Utility, or a Cloud, just understand the implication for your business and find a way to participate.
  • Ask Lance
    How do I make big revenue from hosting? What should I do if I am already a SoftLayer customer and have a web hosting business?
    Twitter Q#1
    How does SL see themselves in a year or 2, ahead of the competition technology wise, or are there any massive things planned?
    Twitter Q#2
  • Thank You!
    Lance Crosby, CEO
    SoftLayer® Technologies