State0 Blog

I met Brooks and took this quick interview at SXSWi but I never got around to posting it. In his free time Brooks built TweetChat. It is a quality site for group chatting on twitter hashes. If you would be interested in embedding something like this into your own site, send him an email.

Today, I attended the Rackspace Cloud Event. I was blindsided by the purchase of Slicehost. I am a slicer and think it is a valuable service. I also think that Rackspace offers a good service for the enterprise. However, they are different companies at the core. I remember I once got a quote for a single managed server from Rackspace that rocketed to almost $500 for the first month. That is nothing like the $20 I pay for my slice. I am not yet sure how I feel about merging the two different attitudes and approaches. Rackspace claimed that they were going to work to preserve the Slicehost mentality and culture. I hope that is true and I hope that the rest of the cloud looks more like Slicehost than like Rackspace. I am sure there is going to be a push to serve the enterprise with cloud services but hopefully they will not forget about the bootstrapper.

Beyond that, Lew Moorman, Chief Strategy Officer of Rackspace, layed out a few other cloud related announcements. They purchased Jungle Disk to offer it as a “Cloud Application.” In addition to Cloud Applications, they will offer Cloud Sites, Cloud Files, and Cloud Servers.

“Cloud Sites” are the things Mosso  already offered. You can upload your app like with App Engine but you also have a database layer unlike App Engine where Google does it for you. I talked to the founder of Mosso for a minute about the database layer. I told him that this was where I saw the largest weakness in the cloud. He said that they were actively working on solving database scaling issues with MySQL folks and other industry standard database companies. Perhaps they will build a Smart Sharder (yes, I hereby coin that phrase) to do all of the work for us.

“Cloud Files” is essentially S3. It will be $.15/GB storage and $.22/GB bandwidth which is awesome. Moorman also mentioned that they will be working with Limelight Networks to offer CDN to the masses. Great stuff.

“Cloud Servers” are vaporware thus far. The idea is to roll in the Slicehost technology so that everything is under the same roof. In the Q&A, Josh Baer of OtherInbox asked when they would support SQS. There was no firm reply but you should assume there will be some sort of message queue service soon. Probably once they pull all of the technologies under the same roof.

Great event considering I simply showed up to hang out. I even got some free lunch out of it.

Photo by aturkus

I attended the Austin Alliance’s Fall Event tonight. It was a a three man panel moderated by Clark Jernigan of Austin Ventures. The title of the event was “Why the Best Time to Launch Your Business is During an Economic Downturn.” This title was thought up before the big kaboom. The focus of the event remained the same, but the thesis was different, if not opposite. Here are a few quick thoughts on what was talked about.

It is uncertain whether the Sequoia presentation will prove to be true. Slide 42 paints a grim picture of how long it will take to recover. However, there is no historical ground for this assumption because there has been no recession this grave in the last 50 years, let alone in the last 35 in which the Venture Capitalists have been around. Regardless of what happens, the game has changed and Venture Laborists are going to have to adapt.

There are a few things about the downturn that are good for startups if (BIG IF) they have some capital to spend. First, they can employ smarter people for less. The engineering giants have cut their rosters indiscriminately and there is opportunity to snatch up smart people as they fall from Yahoos and eBays. Second, there is opportunity to buy out assets from companies that are shedding weight. Those assets can be tied together to produce a lower cost solution for customers because there is no R&D to amortize. Third, you will necessarily learn to manage capital more conservatively (better). There is no room for high-burn-rate companies and bootstrapping is going to become an art.

In general, there is not going to be much VC money around so we should all plan to survive on seed money and inlaws.