Open cloud company Rackspace has announced that over the past six months it has invested almost a quarter of a million pounds worth of cloud hosting services and support for free to startup companies.
To be eligible for the cash injection, which remains up for grabs, the fledgling businesses have to be part of the Rackspace Startups Programme which offers mentoring, technical advice and partnering with major industry players. On top of this, the free cloud services and support are perks designed to accelerate the growth and development of young companies as they scale their IT infrastructure.
According to John Webb, marketing director of startups and developers at Rackspace, this gives the programme’s startups a significant boost. “A few years ago if you wanted to create an online presence you’d have to put in infrastructure, you’d have to pay upfront for certain resources,” he says. “What cloud now allows you to do is start up very quickly and easily at a low cost, then to build your infrastructure as you ramp.”
It means that from a startup point of view, they’re given the ability to control costs and access to powerful resources and computing power from the word go. But what does Rackspace get out of it?
According to Webb, there are two major sides to this question. “Firstly, startups of today are going to be the larger organisations of the future and that time frame is getting more and more condensed. If you look at Twitter for example, Twitter is seven years old. To get to a company that is valued at over a billion dollars in seven years is phenomenal. The speed at which companies are ramping and scaling is getting shorter and shorter, so we want to build relationships and we want to have partnerships with companies that are going to scale and be the businesses of the future.”
Secondly, he points to what he calls a “mass halo effect”, or the community that exists around startups, a “big crossover of talent, technology, awareness, and word of mouth” that surrounds young businesses and creates an ecosystem that other businesses tap into “to outsource development.”
It’s a community that many large businesses seem keen to tap into. ITProPortal was at the Amazon Web Services conference last week, where the progress of startups using AWS services made up a fair chunk of proceedings. It seems that increasingly cloud and startup seem to go hand in hand, but Webb believes it’s not just cloud companies who have become interested in the businesses of tomorrow.
“I think in general people are aware that startups are to a large extent driving the economy. Especially in terms of the future, a lot of growth and employment is being driven from startups.”
But pure cash isn’t the only thing that startups need, or are indeed looking for. “Part of the currency of startups is relationships,” says Webb, “so we help wherever we can to formally and informally build connections and build relationships with other businesses and connections.”
The Rackspace Startups Programme has been running successfully in the US for the past three years, and the launch of the venture in the UK is something that clearly excites Webb. “I’ve got literally the best job in Rackspace”, he enthuses. “I spend the vast majority of my time working with and talking to startups. What I love about it is engaging with them at that level, being in their space, getting to know them, going to talk to them - the breadth and amount of innovation and ideas that’s out there is breath taking.”
Image Credit: Flickr (Scott Beale)