Tag: cloud computing (Page 1 of 2)

Techstars Startup Cloud 66 Plans to Move to Austin Permanently

Khash Sajadi, CEO of Cloud 66, a Techstars company in Austin, photo by Laura Lorek

Khash Sajadi, CEO of Cloud 66, a Techstars company in Austin, photo by Laura Lorek

Cloud 66 moved to Austin from London two months ago to participate in Techstars and the startup plans to stay here.

For its business, the U.S. is the best place to be, said Khash Sajadi, CEO and co-founder of Cloud 66.

Cloud 66 is one of 11 companies in the latest Techstars program in Austin. All of the companies will pitch their companies Wednesday afternoon during Techstars Demo Day at the Austin Music Hall. This year, several of the startups plan to stay in Austin after the program ends Wednesday.

They’ve got financial incentives to stay too.

“I’m looking forward to seeing what the Techstars Austin class has accomplished this summer and Rony Kahan and I have committed a total of $20,000 investment for each of them that decides to stay in Austin,” Joshua Baer, founder of Capital Factory, wrote in his weekly Austin Startup Digest.

“When it comes to cloud computing, Austin is particularly important,” he said. “There are a lot of enterprises and cloud infrastructure players around here like Rackspace in San Antonio and Dell in Austin.”

Cloud 66 has seven employees and four moved to Austin.

The company, founded in 2013, helps software developers build and manage the software that powers their business. It provides IT services as a service.

“This is the engine that powers the business,” said Sajadi.

The company provides technology infrastructure for small to medium-sized software as a service companies. Cloud 66 serves 5,000 software developers in 700 companies globally. Its customers include the BBC, CareerBuilder.com, Adobe, Bugheard and Web Summit. Its competitors include Heroku, a cloud application platform.

The company has raised $730,000 including a $120,000 investment from the Techstars program.

One of the biggest benefits of participating in Techstars Austin program is being able to work with Jason Seats, the program’s managing director, because Seats comes from a cloud background, Sajadi said. Seats, co-founded Slicehost, which he later sold to Rackspace and then headed up its cloud computing operations. Seats is an investor in Cloud 66.

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.

TrueAbility Lands $750,000 in Seed Stage Funding

imgres-1TrueAbility, a technology recruiting startup in San Antonio, has landed $750,000 in seed stage funding.
Rackspace Co-Founder Pat Condon and Graham Weston, Co-Founder and Chairman of Rackspace led the funding round.
TrueAbility, based at Geekdom, launched last year with its flagship product AbilityScreen, a cloud-based assessment service used by companies to evaluate the technical skills of job candidates. On Oct. 13th, the startup launched its invitation-only private beta testing of its product. In the first quarter of this year, TrueAbility plans to launch an open beta testing of its products in which a variety of companies can start screening companies. The product allows “hiring managers and recruiters to measure a job candidate’s abilities on a variety of technologies, platforms, vendor certifications and industry standards that their company uses today or plans to use,” according to a news release.
Currently, companies evaluate a job candidate’s abilities through interviews and other tests. But TrueAbility’s product puts the job candidate in a situation similar to what they would encounter in the workplace to demonstrate their expertise. And since the product resides in the cloud, recruiters can test job candidates anywhere in the world.
TrueAbility’s AbilityScreen can test a “candidate’s ability to think critically and leverage resouces, and how well he or she will adapte to learning new things on the fly,” according to the release.
“The demand for qualified technical expertise in the enterprise has changed, but the way we screen and hire these candidates has not,” Graham Weston said in a news release. “TrueAbility can evolve this space much to the benefit of companies everywhere.”
Qualified technical talent worldwide is in demand and employers spend billions of dollars to find them and hire them every year.
This funding will allow TrueAbility to hire additional employees, said Luke Owen, the company’s CEO.
“The big things we are focusing on is hiring additional developers and engineers,” Owen said. That will allow the company to expand the technologies it can test for using its AbilityScreen product.
TrueAbility will also focus on developing a solid sales model to sell into the enterprise and small business marketplaces, Owen said.
TrueAbility™TrueAbility’s team is made up of Owen, Frederick “Suizo” Mendler, Marcus Robertson and Dusty Jones. Last summer, TrueAbility won the San Antonio Startup Weekend competition. The company was recently selected to participate in TechStars Cloud, which kicked off today in San Antonio. The team will spend the next three months working on its product, building its team and will showcase its progress at TechStars Cloud Demo Day in April.

Rackspace Hosting Expands in Austin

Reporter with Silicon Hills News

Rackspace’s New Offices

Cloud computing company Rackspace Hosting Inc. has a new home in Austin.
The company moved into an 87,000 square foot location next to I-35 in north Austin in October. The offices can accommodate more than 500 employees. The web hosting company currently has 400 people – adding around 100 employees per year for the last two years. Rackspace wants to hire 50 more employees this year.
Rackspace, founded in 1998 in San Antonio, has more than 3,000 employees in San Antonio at its headquarters in the former Windsor Park Mall on Walzem Road. The company also has an office in San Francisco. Rackspace reported revenue of $1.24 billion last year and net income of more than $100 million. The company has a market cap of more than $9 billion.
Rackspace attributes the steady growth over the last few years to its service-oriented business model of web hosting.

Bill Blackstone, Austin Community Outreach Leader for Rackspace

“When you call you get a human, not an IVR,” says Rackspace Community Affairs Leader Bill Blackstone. “You get routed to your team that you know by name… literally in five rings.”
According to Blackstone, the support teams are fully authorized to make important decisions and resolve a customer’s issue without having to check with a supervisor or another department. They are also available at any hour. It all fits into Rackspace’s often touted motto of providing “fanatical support”.
But the support aspect is only one of the four pillars of service to which Rackspace attributes its success. The other three: The security found in physical dedicated servers, the scalability found in virtual servers, and the ability to combine physical and virtual servers to fit a client’s need.
“The combination of those is something that doesn’t exist elsewhere,” says Blackstone.
Rackspace also has an advantage in being the co-founder of the new standard-setting cloud computing platform called OpenStack. Developed in partnership with NASA, Rackspace helped set the standards for OpenStack that are now used industry-wide. The new technology is open-source and available for anyone to use. As a result, over 850 organizations are currently working to further improve the technology. While this means that any competitor can provide OpenStack service, Rackspace hopes to retain the lion’s share of potential new customers due to their reputation for support and their status as a leader in the OpenStack technology.
“We still believe that at the end of the day it’s not necessarily the actual technology, but the service that makes the difference,” said Blackstone.

Rackspace prides itself on “Fanatical Support”

National economic pressures have also impacted Rackspace’s success. While the ongoing recession has stunted Rackspace’s national growth to 30 percent a year – it was originally projected at more than 50 percent – it has caused a higher interest in the profitability of cloud computing. Austin Site leader Max Thoene says that much of the market had been resistant to the concept of cloud computing before the recession.
“The folks that were established that were doing this were like, ‘No, I like my physical server,’ even though it was only 6 percent utilized,” says Thoene.
But as the recession hit, companies feeling the pinch were forced to take a look at cloud services for the cost savings that they desperately needed. As a result, many made the big leap to cloud technology within the last few years. Thoene sees it as a glass-half-full situation.
“It really served as a vehicle to get people to kick the tires and look under the hood of cloud a lot more closely than they would have (otherwise),” said Thoene.
In fact, the International Data Corporation (IDC) — a market research firm — has released an often quoted prediction that “80 percent of new commercial enterprise apps will be deployed on cloud platforms” by the end of 2012 – a major swing for the hosting industry since the 2008 recession. Rackspace is second only to

Rackspace Austin Site leader Max Thoene

Amazon in the cloud computing industry and is sure to benefit from new cloud-using companies.
Rackspace Hosting is also enjoying the advantages of an Austin location. Just one of many tech companies expanding in Austin, Rackspace is experiencing rapid growth due to the city’s educated population and its popularity as a place to relocate talent. The local tech scene provides an ideal recruitment spot for Rackspace.
“We find that there is a great cross section in Austin that has both the technical skill and the service leadership type of skill set that we are looking for,” says Thoene.
According to Austin Technology Council President Julie Huls, this is a common trend for tech companies in the Austin area.
“Companies the size of Rackspace — which are growing at the same pace — are attracted to Austin for its culture. I think we have ample talent as it relates to certain skill sets. We have a very creative workforce here,” says Huls.
In fact, Rackspace enjoys a special symbiotic relationship with the hotbed of tech start-ups in Austin. It works with both the Greater Austin Chamber of Commerce and the Austin Technology Council to invest in new start-ups. They also sponsor fairs – such as Chamberfest – and provide mentoring for new companies trying to get off the ground. In turn, many of those companies can then take advantage of potential cost savings with Rackspace’s cloud services – gaining the company more customers in the long run.
Thoene sees Rackspace’s tech community involvement as something that benefits both the company and the City of Austin by creating a healthy business environment.
“It’s a win-win,” says Thoene. “It’s a win for Rackspace because we get great people and it’s a win for Austin because we keep people employed.”

Story and photos by Andrew Moore

Dell Unveils $60 million Fund for “the Next Big Thing”

Dell Ventures, the investment arm of Dell, wants to find and fund the “next big thing.”
So the Round Rock-based company has unveiled a $60 million investment fund focusing on early stage companies in the “storage, server, networking, cloud computing and virtualization, analytics/BI/Big Data, mobility, end-user computing, services and software” businesses, according to a news release. The company plans to invest in five to ten promising storage startups.
Storage is a huge market with ever increasing implications, and one in which Dell is already gaining ground. Through internal
“We plan to invest more than just money; we will contribute with sweat equity too, bringing the power of Dell to startups,” according to Dell.

TechStars’ Cloudability Closes on $8.7 million in Venture Capital

In the first TechStars class held at the Geekdom earlier this year, Cloudability already had a head start on some of the other companies.
The Portland-based startup had already participated in the Portland Incubator Experiment. When the team landed in San Antonio, they had already raised $1.1 million, according to VentureBeat.
Now Mat Ellis, Cloudability’s CEO, has announced the company has raised an $8.7 million first round of venture capital led by Foundry. In addition, Jason Mendelson and Jason Seats, managing director of the TechStars Cloud, will join its board of directors.
“Just over a year ago we were on stage at Structure with some screen shots and just a few users, so this is a really big deal for us,” Ellis wrote in a company blog post on the deal.
“Today over 3,000 people in 100 countries are using Cloudability. Collectively they have spent over $100 million on cloud services, and added over 10,000 cloud accounts,” according to Ellis. “If ever there was an advert for the power of the cloud, this is it. Three guys have an idea, and one year later that idea is being used across the planet.”
Cloudability helps companies manage how much they spend on Cloud services. Rackspace Hostings offers the service to all of its cloud customers. The company plans to use the money it has raised to hire more people and build out its product offering by adding more features. Cloudability has 15 employees, up from four in December.
The only downside to the funding? Ellis can’t get this tune out of his head:

Most IT Decision Makers View Cloud Computing Positively

Who is this guy in this picture that doesn’t have a positive opinion of cloud computing?
San Antonio-based Rackspace today released a survey of information technology decision makers showing that nine out of ten have a positive opinion of cloud computing and customer service and technical support were their top considerations when choosing a cloud computing provider.
They also reported computing power and data migration as important when choosing a cloud provider.
“The world is in the midst of a tectonic shift toward cloud computing that is revolutionizing the way companies do business,” Rackspace CEO Lanham Napier said a in a statement. “The survey shows that IT decision makers understand the importance of selecting a cloud provider that empowers their businesses with the systems, products, and customer service capabilities to successfully make the transition to the cloud.”
“We believe it is important that companies be empowered with choice, an open cloud and the high level of technical support they need to concentrate on their core business,” Napier said. “A chief benefit for IT decision makers using open-source technology is portability of workloads across vendors and the elimination of vendor lock-in.”
You can find out more about the survey here.

Rackspace is a sponsor of SiliconHillsNews.com

Gazzang Branches Out from its Encryption Roots

Special contributor to Silicon Hills News

Larry Warnock, CEO and president of Gazzang

Something was bothering Larry Warnock. It was 2010 and the former CEO of Phurnace Software had recently finished leading his company through a successful sale to BMC. His next challenge was advising two Houston entrepreneurs on how to realize their business idea.
Mike Umansky and Chris Gillan had come up with an encryption solution for open source software that filled a gaping hole in the cloud computing market. But Warnock felt the name they’d chosen for their company, Critotech, was all wrong. It wasn’t just that it sounded like a relic from a Cold War spy novel. It was that the name’s security connotations would hamstring the company’s growth outside the encryption space, a goal the startup veteran considered crucial to its long-term success.
“I didn’t want to be known as Encryption, Inc.,” says Warnock.
So when he joined the firm as CEO that year, one of the first things he did was look for a fresh web brand name. In a request that sounds like it’s straight out of Seinfeld, he asked his team to come up with a name that meant nothing. He didn’t want the company typecast as it continued to find itself. After some fruitless brainstorming, the team began to look through comic books for words used to denote sounds.
“Sure enough a guy went home and his son found in a comic book a picture of a good guy punching a bad guy and it said ‘Gazang,’” recalls Warnock. “And it was in a little cloud. So we said that’s it.”
Gazang.com was already taken, so they added another Z to make the name Gazzang.
Blank slate in hand, the team has since been writing its own story in the cloud. Management has narrowed the market focus to customers who need Big Data solutions. And it’s got two new cloud tools in the works – one of which will debut in July.

Encryption pays
Not that the founders are ashamed of their encryption roots. On the contrary, their flagship platform-as-a-service software, recently renamed zNcrypt, is turning heads. Gazzang was one of 10 vendors recently selected for the MIT Sloan CIO Innovation Showcase. What’s more, the company recorded its strongest quarter to date in Q1 and its customer base has expanded to 220, including Philips Electronics, the United States Department of Health and Human Services and Boston Children’s Hospital. Healthcare, finance and government are target sectors because they’re required to protect data.
“Compliance was a huge thing for these folks – PCI, HIPAA, SOX – all those guidelines were big challenges,” says Umansky.
He and Gillan first got the idea for zNcrypt while talking with people involved in grid computing and virtual machine automation – the predecessors of cloud computing. Users needed encryption that wouldn’t interfere with the performance of their databases and other applications.
“Chris and I did market analysis and realized that MySQL was the database of choice for these guys,” says Umansky. “It had such huge traction and really there was no way to encrypt that data at rest, so we went out and built our transparent data encryption platform and key management platform.” Transparent data encryption is a process that happens on the fly and behind the scenes so the developer doesn’t have to change the database or underlying application.
“It just happens auto-magically as the data goes to the disk,” explains Warnock. “Then when the data is requested back for processing, its magic key determines if that requester is authorized.”
Because zNcrypt secures the data instantly, it leaves less room for breaches than products that only encrypt periodically. The tool now protects all LAMP-based applications and data. Wendy Nather, research director of the enterprise security practice at 451 Research, says no one else is specializing in database security for the open source community, and it’s a problem that badly needs an answer.
“Every enterprise has open source software somewhere incorporated,” says Nather. “Even if they’re writing their own software, chances are a developer has incorporated some open source components in it. When you’re developing things and you need a lab to play with you’re generally going to turn to open source components because they’re cheaper and you can have as many as you want when you need them.”

Chasing Big Data
Gazzang has continued to refine its direction, shifting slightly when Big Data began to gain
attention. Big Data refers to huge data sets that are not well suited to be handled by current relational databases – usually petabytes or exabytes of information. Much of the data created today couldn’t be processed in a relational database anyway because it is unstructured. It comes from smart phones, tablet computers, cameras and numerous other connected devices.
Data and distributed file system technologies like Hadoop, Cassandra and MongoDB can turn these otherwise lost bits of data into valuable information that companies, governments,science organizations and the like can analyze for insights. Marketers use Big Data to understand aggregate buying behavior and computer scientists use it to analyze the interactions of thousands of nodes in a network.
Gazzang realized that its zNcrypt architecture would fit with technologies like Hadoop and decided Big Data is the way of the future. It’s a change from what the founders initially envisioned but Warnock says that’s par for the course in startup-land.
“Every startup I’ve been in, when we ultimately had great success it was different than what we thought it was going to be,” he says.
Investors are happy with the way things are turning out too. Austin Ventures provided Gazzang with Series A funding worth $3.5 million and has been pleasantly surprised by the turn of events.
“The customer set they’ve gotten has been a little bit different than we originally thought it would be but better in some ways because the deals are larger and the sales cycle is frankly a little bit shorter,” says Thomas Ball, general partner at Austin Ventures.
With all the hype around the cloud and Big Data, Ball concedes that Gazzang risks getting lost in a game of lingo bingo.
“I think positioning and rising above the clutter is the biggest challenge because everyone wants to use the term cloud now,” he says. “But when people see how good the product is and how easy it is to scale, it’s an easy sale.”

In the pipeline
Next up on Gazzang’s agenda: zTrustee, a universal key manager for a wide variety of applications. zNcrypt manages keys for data it encrypts but zTrustee will work with any kind of key, certificate or token used for a wide array of computing processes. It’s intended to be a “single point of trust” for keys and the policies around them, and it will launch in July.
Later this year the company will roll out zOps, a console to monitor and diagnose issues with cloud computing functions.
It’s all part of Warnock’s vision for market expansion beyond the encryption space.
“A lot of the data center tools that exist were never built for the cloud,” he says. “So there’s actually a market opportunity to rebuild all the tools people have been relying on but in this new architecture.”
If Warnock has his way, when people say the name Gazzang they’ll hear a bat hitting a home run.
“What we’re doing with Gazzang and what I think works best in early-stage is to swing for the bleachers,” he says. “We are going to be wildly successful or an epic disaster.”
Whatever the outcome, one thing is for sure. The game will certainly be interesting.

CopperEgg raises $2.1 million and hires new CEO

CopperEgg has raised $2.1 million to complete its first round funding.
The Austin-based cloud monitoring and analytics company also hired Bob Quillin as its new CEO.
Silverton Partners led the investment along with Webb Investment Network and several private investors including Kenny Van Zant of Asana.
To date, CopperEgg has raised $4.1 million.
“Cloud computing has grown dramatically over the last few years to address a broader base of customers who have ever increasing demands for speed, simplicity, quality of service and value,” Quinllin said in a news release. “CopperEgg is at the forefront of a second generation of companies who are enabling this mass adoption, through SaaS-based solutions that are smarter, faster, lighter weight, and more accessible than the previous generation of cloud monitoring tools.”
Quinllin previously worked at Hyper9, EMC Lonix and nLayers.

TechStars Cloud Demo Day blasts off today in San Antonio

Three months ago, a group of entrepreneurs moved into Geekdom in downtown San Antonio.
Since then, the inaugural TechStars Cloud participants have been toiling away and working to create blockbuster cloud businesses that will change the world.
Some have iterated, pivoted and overhauled their operations countless times. Names have changed. Teams have mixed it up.
But in the end, 11 companies stand ready to present today at the Charline McCombs Empire Theatre in downtown San Antonio.
The event kicks off at 9:30 a.m. and ends around 2 p.m. But a reception later in the evening at the Weston Centre will celebrate the accomplishments of this group of entrepreneurs and their leaders, Jason Seats, founder of SliceHost and Nicole Glaros, managing director of TechStars in Boulder, Colo. Seats and Glaros ran the TechStars Cloud program.
The TechStars Cloud focused on cloud computing and cloud infrastructure. Its mentors included Pat Condon, founder of Rackspace, Jeff Lawson, founder and CEO of Twilio, Brad Feld, head of the Foundry Group, George Kardis with SoftLayer, Rajat Bhargava, founder and CEO of StillSecure and dozens more.
All of the companies received $18,000 and access to more. Today, some of the companies will ask for investment capital, while others are fully funded. The audience will include venture capitalists and angel investors.

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