We built that: 10 years in business

[warning: longer post] I mentioned this on twitter (@sijoe). The day job has been in business for 10 years. We’ve not taken outside investment to date, and we’ve not sold the company yet. We’ve been profitable and growing continuously during our lifetime. The preceding 3 years have seen growth, accelerating hard. The company was built starting with a conviction that practitioners and users of HPC systems needed better designs, better systems than were being pushed out by traditional vendors in the early 2000’s. As beowulf systems took off, we saw some of the most egregious designs … 4 years ago, I wrote a post decrying some of these issues I had seen. And the points I raised rubbed a number of people the wrong way, as you can see in the comments. We started the company in part to make sure the high performance side was represented in these cluster systems. We haven’t always been successful in this endeavor. In the late 90’s, I had been an advocate within SGI for building and selling clusters. I pointed out benchmarks to colleagues whom had insisted that RISC machines would never lose in performance to CISC machines. Its very hard to explain away benchmarks that show otherwise. I had argued, in a very Clayton Christenson manner, that we should should creatively destroy our own products, lest our competitors do this for us. Which they did. The clustering effort at SGI was canceled when SGI exited the x86 market for the first time in 2001. I left within weeks of this, as I was convinced at that time, even though it was by no means certain, that Linux clusters would come to dominate HPC (for at least a while). I thought the management (then) at SGI had made a mistake. My failure at that time was not to wait for a layoff and take a severance package, so I could start this company. That was a mistake. Not a fatal one though. I had limited tolerance for risk at that moment, and felt I needed a larger company around me. 16 months later, having experienced what I needed to experience at another firm … I decided I needed to start this company, if for no other reason than to prove myself right. I spoke to my wife and we talked about the issues relative to our 1 year old. This was a huge risk. Monumental. I was putting out a shingle at the height of a recession. I was doing this

(a mouse “flipping the bird” to an bird … ) to the recession. We had our first customer in 15 days. Our second in 30 days after starting. Now here we are 3652 days later. Going from a skim over the water at slow speed, to 45 degree attack angle and full throttle about 5 years ago, then 60 degree attack angle and afterburners lighting off, pressing us back hard in our seats just a few years ago … to low earth orbit and warp cores spinning up now. Yeah, we built that.

We took all of our retirement 401k investment and poured it into this company. We took a massive pay cut. We placed our family at financial risk by loading up our credit cards. We got lucky and met some of the best customers and partners on the way. People you love to work with, and really enjoy spending time with. We’ve met characters, egomanical, narcissists, and many others. We’ve taken risks on hiring people … a few paid off … very few. Many did not. This has colored my thinking on hiring … and has impacted what we will and will not do going forward w.r.t. hiring. You can’t teach drive, you can’t really impart self motivation. You are either a go-getter, or you are not. We’ve had putative partners stab us in the back, we’ve had a few customers steal from us. Our terms and conditions are a cri de coeur over misbehavior we’ve experienced. I finally understand the purpose of “the fine print”. To this day, we experience attempts at bullying. But I’ve learned. I am pretty good at protecting what I’ve built. And for whatever its worth, one of the groups that was pretty successful at misbehaving was a government group (non-US). It helps when you write and enforce the rules … you can bend them and interpret them any way you wish. We’ve grown this company. And bled for this company. There have been times I’ve questioned what we were doing as it seemed that all that kept us aloft was a wing and a prayer. But as they say, what doesn’t kill you … makes you stronger. 10 years on, and I’ve got the battle scars along with the experience. I know how to adapt. I know how to compete. I know when I should not. 9 years ago we started working on designs and business plans for HPC accelerators. We believed then that accelerators could be the future of HPC, in oh, I dunno, 2013 2014 time frame. Almost got an investment then, but we weren’t in the right city, so … tough. Continued to push hard on the accelerators. Proposed reworked plans many times until about 2006. Thats when I realized that while our idea was right, the VC types were not all that into HPC, not all that interested in non-web 2.0 stuff. For those who don’t remember, that was the investment fad before social media, before clouds, before … well … pick the startup/investment fad du’jour. We had a real design, a real plan, a real estimate of market size, margins, capabilities, risks, … And now, years later, I can say it is chilling how correct we were. “Dead on correct in all aspects” is the most concise way I can say it. And … we … couldn’t … raise … a … dime … for … it. It was during that time that we noted that a few months after we had pitched a VC, we were asked to do due diligence on an idea from another VC. And we saw a few of our slides in the deck we reviewed. Yeah. That was profoundly disappointing to me. To a degree, it still is, though time has mostly healed those wounds. Around the time we realized accelerators would happen, just not for us, we looked at the computing market, and realized that we were doing an exceptionally good job on designing and building storage systems. Clusters are clusters. Pile of cheap machines (a cycle is a cycle for the most part, as long as it is efficient). No real differentiation between different cluster units. But storage? Here we were building units that were able to sustain huge loads for clusters, far in excess of what our customers were used to, and this solved one of their long standing problems. We adapted. De-emphasize clusters. Emphasize what we do well. So we did. And the pre-JackRabbit units were re-architected, tweaked and tuned until we came out with the first JackRabbit unit. It was big, fast, loud … And it sold. And the next one. And the one after … We designed for performance … this wasn’t a jbod/pile of disks (still a common design pattern). This was an architected system. Lots of COTS bits, but very carefully selected COTS bits. Then we noticed that our tuning assumptions needed updating. And we had to tweak/tune drivers. And kernels. So we started offering our kernels on the units. And we kept updating the components. Still large quantity of COTS, with some decidedly non-COTS. DeltaV was born of removal of extra cost bits. Could we provide a storage target for less … turns out we could. First DeltaVs weren’t fast. Current crop are 50-70% the performance of our JackRabbit units at a lower cost. More of our IP was being added in. I said we are coming roaring across the 10 year mark. I am not kidding. Next gen JackRabbit and DeltaV’s and now siFlash all share the same chassis now. Our new chassis (again, taking a risk here) is available only from us. And with it, we’ll be hitting some incredible densities, performance, and performance densities, at aggressive price points. You’ll be hearing more about this soon. And seeing it. Our already best in class/market performance is about to get kicked into much higher gear. But that’s not all. Not even close to all. We have products we’ve been developing with particular customers in mind, that will probably piss off some large vendors in a new area for us. And we are going to bring them out at reasonable price points. Initial tests are absolutely amazing in raw performance. And thats not all. We’ve got some … other stuff … I can’t talk about. And its killing me not to. But it should be quite disruptive once it hits the market in near final form. I’ve had very little sleep over this past 10 years. It’s like grad school all over again. Work, sleep, eat, consume coffee. I built this. I hired people. I created opportunities. I did this in the face of tremendous personal, financial risk. No government helped me. No government offered me assistance. We asked our local Michigan government folks why they were giving all these tax breaks to larger corporations, but not helping the small guys (like us) a few years ago. The answer came to leverage and politics. When we were big enough to matter, they told us, they would pay attention to us. Nice. Meanwhile … I hired while others fired. I exported while others imported. I brought capital into the state while others exported it. We were an anomaly. A growing high tech company bringing capital, sending exports, in the state of Michigan. Too small to be of concern or offered help, to those that according to some, helped us. Was it my hard work? My brains? My tenacity? My adaptability? My unwillingness to fold? Yes. These were the reasons. Self congratulatory and all that. But more than anything else … luck. Lets make sure everyone understands this. Luck matters. Meeting good customers. Being at the right place at the right time matters. Sometimes more than the other things. If you aren’t at the right point at the right time, you need to rely upon your brains, tenacity, adaptability, and hard work. Most have to. But luck is not an insignificant part. Or more practical “luck”. When an opportunity comes along, you need the brains to recognize it. You need the tenacity to not let this opportunity get by you. You need the hard work to push through to successful conclusion. And you need to be able to adapt to situations you’ve not anticipated. I am a fighter. I have always been a fighter, and I will always be a fighter. You want me on your side … this is why we provide over the top support … I don’t believe in anything less. This is not a path for all. Really for very few. Joining a startup is nothing … NOTHING … like placing your family’s financial livelihood and fiscal viability at risk. Anyone suggesting otherwise really doesn’t have a clue as to what risk is. This entrepreneurial life is not one for the feint of heart. It is going to scare the crap out of you. The terror will be sustained. It will never go away. You have to learn how to manage it. To use it. To leverage it. You stare into the abyss. And it DOES stare back. Lots of people will snicker at that. Entrepreneurs, those who sell stuff for a living will understand completely. Most won’t. So when some nitwit tells you “gee I joined startup X and am taking a risk with my future … I might need to get a new job someday” … yeah … about that. This is my retirement fund. This is my daughters college education, inclusive of graduate or medical school. Finding a new job? Thats risk? AYFKM? Way back at SGI in some of the sales training they provided, we had the cute aphorism: “A chicken is involved in the success of a ham and eggs breakfast. A pig is committed.” If your skin really isn’t in the game, if you aren’t really taking the risk … No … If you didn’t bleed to build it … if you didn’t give up your time for no pay, spend precious time away from your family … Yeah. We’ve watched competitors try to extract our designs and implementations from us. We’ve watched them build poor imitations, not achieve anything close to the sustained performance we provide. We’ve watch them lie … overtly lie … on government RFPs. We’ve pointed this out, but you know, it didn’t matter. Who, precisely was helping us at that point? We built this. With our brains, our tenacity, our adaptability, our risks, our luck. Anyone suggesting otherwise is monumentally clueless. No one helped us. We got lucky. And we were smart. Or maybe too dumb to stop. I dunno. Either way, we hit 10 years. And we are going to keep going, faster than before. Harder than before. Our new stuff rocks. And will rock. And will shake up others. 10 years is merely our first decade. Today, we begin our second. We built this. We did. Without help. With many hurdles. With many barriers to overcome. With a state government, until our new governor showed up, that was overtly hostile to small business. I’ve experienced hostile. I know it when I see it. I call it out when I see it. There is no silver bullet. No magic formula. It takes brains, hard work, luck, the ability to stomach risk, the ability to deal with the terror on a daily basis, and not a small amount of luck. Companies that get help along the way probably don’t have the instincts we’ve developed. Haven’t honed their senses. These would be the Solyndra’s of the world. We’ve succeeded in spite of all the crap arrayed against us. We’ve grown stronger. Learned to live leaner. Learned when and how to take advantage of opportunity. And I keep mentioning luck. You have to understand that luck is opportunity. And it has an expiration date. We built it. 10 years. And we built it. With no help. And lots of things working against us. We built it. Second decade, here we come!