Kiwi-firm GreenButton was ranked number two on this year's Deloitte Fast 50 listing for New Zealand with a growth rate of 933.38%. Part of the spike in growth can be attributed to the relatively recent hiring of active sales people in its focus market of the US.
"We invested later in the go-to-market than we could have. It is really only about a year ago that we started investing in that. We have been pretty much engineering led, which has been great to building out our platforms," says Dave Fellows, CTO of the firm.
GreenButton currently has 30 people, around 15 of who are engineers. The engineering team resides in New Zealand, while the team in the firm's San Jose, US office is largely focused on sales and marketing functions. However, the history of the firm can be traced back to the historic creation of the Lord of the Rings movies, and specifically one man.
Scott Houston, founder of the company, was then the CIO at Weta Digital and realised that there must be numerous firms out there that required superior computing power, and lots of it, during periods of time, but would find a capital investment in it extraordinarily wasteful since they are only likely to use these ICT resources intermittently.
This was the start of the thinking that eventually led to GreenButton, a firm that provides the ability for companies to seamlessly access on-demand computing power.
"Whether it is for rendering a movie, or DNA sequencing, seismic processing, or financial services – there are different examples where you have got companies that just need this burst of computing power for short periods of time. Traditionally they would had to over provision large data centres to take on these big loads and most of the time they will be sitting there heavily underutilised at an average 5 per cent utilisation.
"GreenButton allows companies to find these oases of massive computing power at the push of a button," says Fellows.
The company enables this through its software platform that was created from scratch, and off of which it provides all its services. Over time, the firm has worked on strategic partnerships - like Pixar and its RenderMan software - along with working with service providers like Amazon and Microsoft, to enable true cloud provisioning for its customers.
"The really interesting thing for end-users is not just the computing power that they can get on demand but the licences as well. That is a very important point. Without GreenButton if you wanted to go and run a thousand new machines, with RenderMan in the cloud, you would have to have a thousand annual licences for those machines. With our services, the end-user connects to the compute power and pays a single price for compute, the storage as well as the licence. So it is pretty cost effective," states Fellows.
The firm went through a "productisation phase" about nine months ago, by which enterprise customers can now run GreenButton's software platform on-premise, and use it to tap into private clouds or move workloads out into the public cloud when they 'need bursts of computing power.'
"We allow for legacy apps to be rapidly cloud enabled. Just the computing part of these apps can be enabled to run on the cloud and scaled out across tens of thousands of processes without the whole app needing to be rewritten. This is quite key.
"The other parts of our software manage data, accelerate data transfer to the public clouds, and we have a whole bunch of governance features that sits on top of the cloud deployments and allow larger customers to do chargebacks across their organisational units. They can manage where their costs are being attributed for cloud usage. That is a key capability that our platform supports as well."
It is no wonder then that the company boasts customers in 77 countries, even as 98 per cent of its business remains focused on the US market.
"We focus on the US market at the moment –that is the market that is moving the fastest. It has the most opportunities with the cloud, particularly around high performance computing and big data areas of the market," explains Fellows.
The company is also seeing increasing interest from diverse companies, like software development firms, in its platform. However, it has not always been smooth-going for the firm.
"The biggest challenge for us was getting the funding. It was hard to do much till that point. Once we got that initial funding in 2009, the next big challenge was getting the right people to be on the team. It took a lot longer than we anticipated in achieving the headcounts that we projected. We wanted to make sure that we had the right people and right culture. We are thankful that we were a little patient there. We have got an amazing team here of some of the best engineers in NZ or even the world," says Fellows.
"Other challenges have been small business challenges, like finding the right balance between focusing on particular areas that you can be best at as well as broader areas, so you can satisfy the user cases that you potentially could. That is a real ongoing challenge," he adds.
Though the company seems to have achieved this well, mainly by focusing on one target market (the US) and getting its brand established, Fellows accepts that there were some advantages playing for it as well.
If you look at some Silicon Valley businesses at the same level that we are, they go through $4 million in six months, while it might last us for two years.
"The biggest limitation for a traditional start-up in the technology area is around trying to get the product out to the global market. The advent of the cloud has really removed those technology constraints. That was the key platform for us to be able to launch the global offering on.
"I think the advantages are numerous. What we are able to do with the amount of our capital investment here in NZ is definitely magnitudes more than what can be done in the US. If you look at some Silicon Valley businesses at the same level that we are, they go through $4 million in six months, while it might last us for two years. We have also used these investments wisely - spreading it across engineering and going-to-market only in focused geographies.
"Aside from that, Kiwis have a really good reputation as innovators and individuals that are highly dependable. That is the strength of Kiwis – a get it done attitude, and do everything you can not to let your customers down philosophy," says Fellows.
According to Fellows, the firm has enough cash now to last it till September 2014, and more if the revenue picks up. Nevertheless, GreenButton is in conversations with strategic investors on getting more funding to accelerate growth further.
"Mostly we would want to invest on the go-to-market and sales side – the platform itself is pretty solid. We might get a few more engineers to work on it. There are some interesting things we have on the roadmap. But it would be primarily around the sales and marketing side," says Fellows.
Even as it aims for growth, the company believes it will be keeping its engineering team in New Zealand, since the relative costs remain a third less than the US, and it makes financial sense to stick with the model.
Roadmap for the future
Fellows sees an increasing relevance for solutions like GreenButton's considering the prevailing cloud trends that they are witnessing.
"Larger organisations want to leverage both private and public clouds. Governance is key, especially in this trend towards multi-cloud strategies. Customers typically don’t want a cloud just from one vendor. So having this ability to manage these disparate cloud platforms and manage governance across them is becoming a key focus. That is a trend that we will see more of in 2014.
Kiwis have a really good reputation as innovators and individuals that are highly dependable. That is the strength of Kiwis – a get it done attitude, and do everything you can not to let your customers down philosophy.
"We are starting to see a trend where a lot of true scientific research - the hard core high performance computing - is moving to the cloud as well, because the economics of the cloud model is too hard to resist," says Fellows.
GreenButton is developing some key intellectual property that will enable it to tap into these developing trends more in the future.
"We have developed this ability to predict how long jobs will take to run in the cloud. It has been patented and approved in NZ and pending in the US. Once we can predict how long a job can take, how many compute cycles it will take, our commercial engine can turn that production into time-versus –cost for the end-user. They literally get this slider where they can drag it left and right, see the average time that it is is going to take for them to get the job back and the cost they have paid.
"They can think about business outcomes rather than cores or processes. That is really exciting, and a key differentiator in the market," says Fellows.
This also enables GreenButton to earn higher margins on the computing power they leverage, since customers will be willing to pay more on the additional value that the firm provides.
Read more: Microsoft buys Kiwi firm GreenButton
"We have built a very good horizontal platform that enables management of these workloads, as well as key vertical solutions, like ones for digital media and entertainment. Now resellers of software in the industry can come to our systems, and create these vouchers, that they can then package out. The resellers can actually monetise the cloud.
"We have the tools that will allow the whole ecosystem to monetise cloud computing capability, which is pretty unique in the market now. This is why the big cloud providers find us so interesting. We are not just talking about infrastructure, we are talking about very high value services on top of that infrastructure," says Fellows.
One can't help but agree.
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