Rackspace CEO Taylor Rhodes quits to spend more time with his kids
President Jeff Cotten named interim CEO, mere months after company went private
Rackspace CEO Taylor Rhodes has decided to leave the company he's led since late 2014.
He's blogged the reasons why, of course. And of course there's some phrases that could only come from a tech company, like “I’m proud to have led Rackspace through a hinge in its history”.
A hinge? That's what Rhodes calls moving out of public cloud and into cloud services, before taking the company private in late 2016. Rackspace also abandoned an “OpenStack-powered open clouds are the only clouds worth having” creed and adopted a “whatever cloud you want, we'll run and/or service it” position.
The timing of Rhodes' departure looks suspicious, coming as it does just nine months after going private. But there's no hint of an ouster in his departure post, in which he says he's off to become “CEO of a smaller private company … about the size Rackspace was when I started here 10 years ago — and it’s growing about as rapidly. It’s using cloud technologies to disrupt what has been a very low-tech industry. The company is going through growing pains and needs a CEO who has been through those challenges before.”
He can't name that company for a few weeks, but says working for a smaller company will give him “more control over my schedule and more time with my kids before the two oldest, who are now in high school, leave home for college.”
Rackspace president Jeff Cotten will step up as interim CEO and says “While my title is “interim” CEO, our board and I are in agreement that we’re not going to take any kind of timeout. We’re going to keep driving to expand Rackspace’s leadership of the fast-growing market for managed cloud services.”
There's no word on whether Cotten is on training wheels or if a search for a permanent CEO is under way. It wouldn't surprise if the latter scenario plays out because Cotten only became president in January 2017. But Rhodes reckons Cotten will do fine because he was instrumental in setting up Rackspace's international business, which “now produces about a third of our $2.1 billion in annual revenue.”
Cotten offers some data of his own, noting that as a private company Rackspace isn't obliged to tell you its phone number, never mind a revenue number. “I can tell you that for the full year of 2016, we grew in revenue across all of our product lines,” he writes. “We grew EBITDA and expanded our EBITDA margins. And we more than doubled our cash flow and cash flow margins.”
Of course Cotten plans to send all those numbers further skyward, especially once Rackspace starts offering services for Google's cloud any week now.
Rhodes' departure is almost being mourned: the company has a strong collaborative culture that the former CEO championed. Consensus from employee posts The Register has read on social media suggests that culture will survive his departure, but that the transition will be made easier thanks to the strength of the company's identity. ®