How to Help a Startup Become a Digital Powerhouse

Increased demand for its products has prompted startup company Acme Connected Apparel (ACA) to shift its technology-driven clothing business into high gear.

Unfortunately, many of the services it currently relies on just can’t keep pace. During the Channel Partners Evolution keynote panel discussion titled “Gearing Up for Success,” five top suppliers – and one demanding partner – will debate what’s the best way to position ACA for digital-powered growth.

Is it all cloud, all the time, or should Amy Acme, the company’s CEO, invest in some physical infrastructure? What about equipping employees for productivity? How about disaster recovery, just in case? All of these issues will be debated by the panel in this concurrent education session.

Michael Goodenough, BCM One’s vice president of cloud solutions, will be the moderator. Panelists will include: Brandon Elliot, Rackspace’s chief technologist; Jim Poole, Equinix’s vice president of business development, service provider vertical marketing; Derek Siler, Sungard Availability Services’ director of solution engineering channels; Brian O’Connor, Granite Telecommunications’ director of solutions engineering; Max Silber, MetTel’s vice president of mobility; and Roger Toennis, mTusker’s CEO.{ad}

In a Q&A with Channel Partners, panelists shared their advice for Amy Acme on a wide range of issues.

Channel Partners: What’s your best advice for a startup aiming to position itself for digital-powered growth?

Goodenough: From the very beginning, make sure that your company’s efforts are completely measurable. This means using cloud, applications and business-intelligence tools. Data is your best friend. It can be used as a prescriptive tool for sales and offer valuable insights to predictive analytics that can drive growth.

Recruit the right team that can master and adapt to new technologies. Focus (on) quality, not the quantity, of the technology that you use. A bunch of disparate applications and systems can lead to dysfunction and disorganization.

O’Connor: It’s important to ensure that the limited infrastructure that is purchased to support startups is scalable. You don’t want to under-purchase equipment, circuits or infrastructure. For example, we want to move away from older copper-based, non-scalable solutions and make sure to purchase services such as fiber Ethernet that are fully scalable.

Poole: Flexibility is key. In a world where IT is now delivered “as a service,” it’s no longer about choosing the right box or software vendor.  It’s about choosing the right service provider(s). This is great because we’re trading CapEx for OpEx … the fundamental beauty of the cloud delivery model: pay as you go.

Silber: Don’t get distracted by …

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… the number of component and platform providers out in the marketplace. Start by defining your core product and its differentiators, and then apply your Internet of Things strategy by selecting your DNA – Device, Network and Application.

Fitbit is a great example of that. They didn’t set out to develop the most techie sports watch in the world. They build a platform with a basic step-counting app and device that syncs up via Bluetooth. Once they saw success, they expanded into a product line on that same platform that now includes high-end, multi-sport watches, but still works on the same platform as all others in the Fitbit portfolio.{ad}

CP: What are the potential pitfalls for startups and how can they best avoid them?

Goodenough: Trying to please your board before your customers can lead to failure. Focus on customer value and response instead. Use the board as advisors, not a measurement of company success.

Hiding problems and shortcomings from your investors. Experienced venture capitalists/investors tend to be great resources because they’ve been through this before. There’s hardly a problem that would shock or stump them.

Using the wrong technology tools in your business. Find the right partner to advise you in leveraging the appropriate tools and best practices for your particular industry and vertical. Not considering compliance, regulation and security could destroy your chances of success before you even get started.

O’Connor: It’s important to know that all the “best solutions” usually come with a price tag. We want to work together to ensure solutions that are purchased meet the IT budget. It’s no good putting in 100MB Ethernet circuits that are 10 percent utilized over a three-year period. That’s thousands of dollars lost that could have been better spent elsewhere. You need to be scalable, but you don’t want to be paying for something that you’re not going to grow into in a three-year growth outlook.

Poole: Simply having the ideal economic model for IT investments doesn’t ensure success. One common misconception is that you can do everything in the cloud with an “over the top” (Internet) delivery model. Although there are certainly a great variety of workloads that can tolerate the inconsistency of the Internet, there are also just as many which have strict performance, security and/or privacy requirements. As such, most enterprise adoption of cloud services now follow a “hybrid” and “multi-cloud” model, whereby some IT resources are controlled directly by the enterprise, but are directly connected to a/the cloud(s) via private access. For example, for reasons of data privacy or sovereignty, a company may store their data on storage arrays they own and operate, however they colocate the data next to their preferred IaaS-provider, where the data is processed, giving them the best of both worlds.

Several industry analysts have noted that establishing “network” or “communications” hubs in MTDC environments, where networks and cloud providers colocate their …

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… gateways, allows an enterprise the greatest flexibility to connecting to the clouds they need via the appropriate access method for a given workload.

Silber: Overinvesting in the technology and underinvesting in the core product. Startups sometimes think that they have to choose a single technology and peg their differentiators to it. The abundance of “as-a-service” providers in the marketplace and ready-off-the-shelf IoT products means that today’s startups can focus investment around building a solid product, not spend all the startup money on infrastructure.

CP: How do you prioritize what’s most important to invest in now and what can wait until revenue increases?

Goodenough: Investing in marketing/sales automation tools initially that can lead to growth and increase profits. Don’t overindulge on tech investments unless it can lead to clear and visible company growth and profits.{ad}

Investing in employees who have a wide variety of skills instead of a “specialist” can help save money and complete more tasks early on with less money spent on payroll. Wait until revenues increase and company growth to begin to hire specialists at different positions within your startup.

Your company’s road map will differ by industry and vertical. Overall, invest early in the ideas, people and technologies that can lead to direct profits and clear company growth within a reasonable time frame.

O’Connor: Most importantly, what will improve the customer experience? We want to make it easy for customers to purchase, get questions answered and ultimately have a great experience. If that involves a little swivel chair on the back end for the beginning of the company expansion, maybe that is OK.

Poole: At Equinix, we recommend establishing a communications hub in core service markets, where you have a high concentration of employees, customers, or ideally, both. Your communications hub provides the control point by which you can connect your enterprise to public cloud resources or stage private assets for a hybrid-cloud architecture. Also, for enterprises with a public-facing business model … this allows you to localize instances of your services closest to where they’re consumed, thereby giving your customers the best possible experience.

It should come as no surprise that this is exactly the same deployment model employed by all the major IaaS/PaaS/SaaS providers. Such an architecture allows you start small, concentrating only on the markets and applications you need to start, but allowing you the flexibly to morph your service provider and private/public mix as business conditions and service requirements evolve.

Silber: As a business owner, what can be used across all current and future products as the business grows? Single-purpose technology rarely pays for itself, and the same applies to housing and maintaining your own infrastructure. Build an environment that can scale, where your costs will only increase when your business grows. Cloud-based infrastructure services to manage everything from your IoT platform, to security on your mobile environment is how I would build the business. Also, look for solution providers that operate outside of the traditional lines and can provide you with better value, process and tools. That will help give you a leg up over established competitors.

Register for Channel Partners Evolution here.