Cloud Seeding: Rackspace’s Soft Spot for Startups

5/9/13Follow @wroush

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Postmaster, a cloud system that helps e-commerce companies integrate with FedEx, UPS, and the U.S. Postal Service.

And there’s one more potential perk for lucky Rackspace startup partners: the opportunity to meet, and potentially be featured by, uber-blogger Robert Scoble. The former Microsoft technology evangelist joined Rackspace as a “startup liaison officer” in 2009, and with his crew of video producers and his hundreds of thousands of Twitter followers, he has the power to vault obscure startups to stardom overnight.

Scoble chooses his interviewees without Rackspace’s oversight, but “we introduce companies from the program to him frequently,” Turney says. “To be able to provide that exposure to companies in our startup platform is a huge benefit that we can offer. There is only one Robert Scoble, and he happens to work for Rackspace.”

Di Spaltro—a former Rackspace power user who became an employee—serves as a different kind of ambassador to the startup community. Cloudkick introduced its first product, a dashboard that helps companies manage cloud applications, in January 2010. Rackspace acquired the company just 11 months later and put the dashboard to use in its own hosting services, while using the Cloudkick team as the nucleus for its downtown San Francisco operation, which now counts some 90 employees.

Di Spaltro says he spends part of his time going to meetups and other startup events in the Bay Area, “giving talks about my experiences and the things we’re learning at Rackspace.” Alma mater Y Combinator is one of the places where Di Spaltro regularly pitches the company’s story. “We are at such a unique point in time, where there is all of this power to get stuff done faster,” Di Spaltro says. “We’re trying to empower entrepreneurs to not have to worry about hosting, in exchange for being on our platform and giving us feedback.”

Absent an incentive like the startup program discounts, why would an engineer at an early stage startup pick Rackspaces’ cloud servers over Amazon’s EC2, Microsoft’s Windows Azure, GoGrid, or the other big “infrastructure as a service” (Iaas) providers? Prices don’t differ much between the leading services, so other factors come into play.

One, clearly, is customer service. Rackspace makes a big deal about providing what it calls “fanatical” support. “We’ve got people who are laser-focused on helping our customers, and you’re not going to get that elsewhere,” says Di Spaltro. “We all love technology, and we all love products, so we love letting the experience speak for itself.”

Then there’s portability. Unlike Amazon or Microsoft, the company has built its whole hardware and software infrastructure around OpenStack, a set of open-source IaaS tools. That means startups that use Rackspace can easily switch their applications and data over to other OpenStack-based systems, if they ever need to.

“Where a startup thinks they are going and where they end up can be two different things,” says Turney. “With Rackspace they have the flexibility to change their infrastructure in myriad ways without being locked into one vendor or one proprietary way of doing things.”

In many ways, offering a startup a big discount on cloud services is like offering a college student a big discount on a computer: if you can get ‘em while they’re young, you may just have them for a lifetime. (It worked on me—I got my first Mac in 1987 and I’m still an Apple customer today.) But at Rackspace, there’s also a more human element. A lot of its employees remember what it’s like to work for a startup.

“We try to treat startups as if they are going to be the next big company,” Di Spaltro says. “It’s probably self-identification. We want them to succeed as much as they want to succeed, so we do what we can to help them.”

Wade Roush is a contributing editor at Xconomy. Follow @wroush

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