Feeds

'Unprecedented' Rackable makes sense - CEO

Go figure

High performance access to file storage

Interview Conventional wisdom would lead you to believe that Rackable Systems should have flopped.

The company's motors kicked in post-bubble just as the server market started to contract. Two of the largest x86 server makers - Compaq and HP - merged, shrinking the x86 realm even more. The only start-ups thought to have a chance in such a climate were R&D heavy players such as blade server specialists RLX and Egenera. They could mine a niche not yet served by the Tier Ones.

Rather than going spectacular, Rackable went simple. It decided to "listen" to customers and pack basic boxes in a rack really well.

Few would have bet that listening would be enough to succeed in the x86 market often characterized as a commodity business already ceded to the likes of HP, IBM and Dell.

"It's pretty unprecedented," Rackable CEO's Tom Barton told us in an interview this week. "The first customers were folks like Yahoo and Google who needed x86 servers in mass quantities and just weren't getting the form factors and deployment mechanisms that they wanted from the Tier Ones."

Could form factors and deployment mechanisms really be the stuff that dreams are made of? Apparently so.

Rackable's June 2005 $12 per share IPO failed to impress, but, over the past year the company's stock has surged, reaching a high of $56 before settling in the $30s. The company claims big names such as Yahoo, Microsoft and Amazon as customers and ranks in the top five North American server sellers. Meanwhile, rival start-up RLX collapsed, and Egenera gave up on its IPO ambitions.

Photo of Rackable's Tom BartonIt looks as if the Tier Ones are comfortable handing $100m in revenue per quarter to Rackable. They''ll focus on selling x86 servers for running business software, while Rackable concentrates on building energy efficient, well-cabled, compact systems sold by the, er, rack.

"The Tier Ones still have not picked up on what's going on here," Barton said. "I would argue that the blade products from IBM and HP are aimed at a different market than what we do. Ours are sort of quasi blade solutions where we achieve blade or better density levels but with much better thermal management and more flexibility.

"I think the big guys did not pick up on the idea that large-scale, data center-class x86 server deployments could be done a different way."

Barton's Spring

A Silicon Valley native, Barton picked up a BA, BS and MBA from Stanford, where his father taught law for decades. After doing some coding and taking on management roles, Barton traveled the even more upper-crusty path of the venture capitalist.

By many accounts, that route should have turned Barton into a Web 2.0-addled funding fiend, searching for the next internet high-flyer rather than seeking to run a stodgy server maker in a shrinking market.

In our experience, the arrival of a venture capitalist-cum-CEO at a start-up usually spells doom. The investors back their man to a fault, crippling the geeky founders' vision by aiming too high, too quick.

Barton, however, seems to have bucked this trend by joining Rackable a couple of years into its existence (2002) and actually turning the vendor into a success.

[You can hear Barton explain some of his early moves here.]

"I had spent a year and a half in venture," Barton said. "It was a good experience, although I was frankly bored doing that. I learned enough to know that I wanted to go back and do at least one more operating role. "

[And there's more on Barton's move to the CEO post here.]

While Barton's tenure as Rackable CEO's has proved solid, he can only take so much credit. After all, three bigger names - Yahoo, Microsoft and Amazon - have done more for the company than any single executive. Such flashy clientele, however, comes with costs.

High performance access to file storage

Next page: On the rack

More from The Register

next story
Seagate brings out 6TB HDD, did not need NO STEENKIN' SHINGLES
Or helium filling either, according to reports
European Court of Justice rips up Data Retention Directive
Rules 'interfering' measure to be 'invalid'
Dropbox defends fantastically badly timed Condoleezza Rice appointment
'Nothing is going to change with Dr. Rice's appointment,' file sharer promises
Cisco reps flog Whiptail's Invicta arrays against EMC and Pure
Storage reseller report reveals who's selling what
Bored with trading oil and gold? Why not flog some CLOUD servers?
Chicago Mercantile Exchange plans cloud spot exchange
Just what could be inside Dropbox's new 'Home For Life'?
Biz apps, messaging, photos, email, more storage – sorry, did you think there would be cake?
IT bods: How long does it take YOU to train up on new tech?
I'll leave my arrays to do the hard work, if you don't mind
prev story

Whitepapers

Mainstay ROI - Does application security pay?
In this whitepaper learn how you and your enterprise might benefit from better software security.
Five 3D headsets to be won!
We were so impressed by the Durovis Dive headset we’ve asked the company to give some away to Reg readers.
3 Big data security analytics techniques
Applying these Big Data security analytics techniques can help you make your business safer by detecting attacks early, before significant damage is done.
The benefits of software based PBX
Why you should break free from your proprietary PBX and how to leverage your existing server hardware.
Mobile application security study
Download this report to see the alarming realities regarding the sheer number of applications vulnerable to attack, as well as the most common and easily addressable vulnerability errors.