Rackspace Co-Founder Pat Condon on Startup Grind San Antonio

images-4At the age of five, Patrick Condon, co-founder of Rackspace, remembers stocking the shelves at his parents video rental store.
It was his first memory of seeing how business works.
He also walked dogs, mowed lawns and threw papers.
In college, he would buy computer parts cheap and then sell them on America Online and message boards for a profit.
At Trinity University in San Antonio, he met Richard Yoo, another co-founder of Rackspace. He met Dirk Elmendorf a little later. They all went to Trinity, but not at the same time. They met up after college.
They created a business that worked. They rented server space to customers around the world. Their first order came in from German. They bought $3,000 worth of servers on a maxed out credit card. The customer paid them $1,000 a month. They would be profitable in three months, Condon said. But it didn’t quite work that way. The next day, they got another order. They had to find money to buy more servers.
Edwin Grubbs, one of the earliest Rackspace employees, gave plasma everyday to buy ramen noodles to keep the crew fed, Condon said. He didn’t have enough plasma, though, to buy servers, he said. So they needed outside investment.
The three co-founders got investment capital from Graham Weston and Morris Miller and together they created what came to be known as Rackspace, now one of the country’s largest cloud computing hosting companies.

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