Well, it seems I was smart(er?) leaving Toronto locale earlier than the rest of theWhir crew. I left early Sat AM to drive (yes Drive) to NJ for a wedding sunday night. After driving to DC, through Delaware and then dropping off my beau @ BWI, I finally managed to hit #hostingcon this afternoon.
In my years, I’ve done alot of conferences, usually however as an exhibitor. It was quite enjoyable to have a ‘hybrid’ role at the conference this week – both as a blogger for theWhir, and the chance to do my own networking for my own firm.
I missed the first presentations (and I hear Seguei Beloussov’s presentation from Parallels went over VERY well), however I did catch the last two (Iain Grant from the Seaboard Group, and a very interesting roundtable featuring Mike Jones, Tim Holland and Paul Stapleton of Softlayer, UK2 Group & DH Capital respectively)…
So anyways, onto the highlights!
The basic gist of everything, according to my sloppy notes:
The Market
- the market is still doing quite well, generally everyone was still growing, albeit at slower rates.
- Capital is quite hard to come by, both via equity and debt markets.
- However, anyone still alive will basically continue to, and are in no rush to sellout at the moment.
- Since capital markets are hurting somewhat, some are prediction a large crunch when it comes to data centers. Basically, there are little to no buildouts going on, and this will come to rear its ugly head in the next few years (anyone remember 2002?)
- There continues to be a large investment in virtualization and summization technologies (New Intel chipsets for example are being sighted as a great boon to hosters and customers alike)
Customers:
- Customers are very keen to learn about optimizations, cost savings and rationalization of services – these are selling well.
- There is a general feeling that technology adoption in general continues at a fast pace. Perhaps not as fast as before, but still on a good curve. This helps to explain why this industry is still doing ‘ok’.
- The uncertainties of the times apply to everyone – including your customers. Help them, to help you!
Valuations:
- Iain discussed several topics related to changes in valuations. Primarily the point that in the olde days (2008/07), speeds and feeds ruled valuations. Data center space, racks and stacks were what were important. Now, its about the customers, revenue streams, and churn rates. Of course, this has always applied, however the renewed focus on ‘soft’ characteristics seems to pervade current liquidity events.
Where to invest:
- Both discussions were definitely focused on giving guidance for the future.
- The overall feeling that I got was that we should continue to invest heavily in like-minded partnerships with organizations that are a good fit – corporately, values-wise and financially.
- Investments in ‘hard’ functions such as building data centers, and paying cash for servers up front are not that strategic and quite limiting on the business growth side.
- Growth via organic methods (word of mouth, good service, etc.) are seen as more valuable and profitable near and long term than some of the ‘traditional vehicles’ of growth – acquisitions and mergers.
I am sure I have missed some points, but these are the ones that were germane to me. In all, it was about being smarter with your cash flow, taking good care of the customers that you have, and taking care of the home office – including good focus on financial and business strategy.
Sounds like a good approach for survival to me!
