Episode 8

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Epi 8: Why Data Storage Matters for Your Business – Dany Bouchedid, CEO of COLOTRAQ

Learn more about COLOTRAQ at: https://www.colotraq.com/

Find Dany Bouchedid on LinkedIn here: https://www.linkedin.com/in/danybouchedid/

JC: Welcome to another edition of the Future Of BizTech. I’m your host JC Granger and I have with me here, Dany Bouchedid, the CEO of COLOTRAQ. Well Dany, thank you so much for coming on the show. Why don’t you introduce yourself a little bit and tell the listeners who you are and about COLOTRAQ.

Dany: Great. Thanks for having me on JC. COLOTRAQ is a 21-year-old company that is a full service broker of data center infrastructure services so that includes colocation both wholesale and retail managed services and any kind of related services like network services or connectivity. We recently added cyber security a couple years ago to our offering as well. And we launched about five years ago, a SaaS platform, cloud-based software called DCITRAQ and that basically allows businesses to go and build and source all of these products and services and build a really robust RFP from end to end and source all of these products and services directly from our network of over 400 vendors worldwide.

JC: See, that’s awesome. Now, obviously you own COLOTRAQ and you guys have great services for your clients there, but I’m really interested in this DCITRAQ because we really love to interview CEOs of SaaS companies specifically. Can you go a little more into that? Tell us, what motivated you to start that? What kind of problems does it solve for companies that are having right now? And what kind of price point is it for people listening to know if they can afford to utilize this? Give us the rundown on DCITRAQ.

Dany: Sure. Honestly, it started as a way for us to redo our own back office so that our staff could easily build RFPs, really robust RFQs and RFPs on behalf of clients and be able to register those RFPs and be able to compare side by side all the different vendors and all their offerings and then cross reference that against the customer requirements that are built into the RFP to be able to come up with a short list of potential buyers that match those requirements and be able to then manage that whole deal all the way through to close. And then we got the idea, hey, this would be pretty powerful if we put this in the hands of the clients, of the end users and their agents. We have an entire network of sub-agents that also use the software on behalf of their clients so it’s pretty scalable.

Dany: We built it on restful API technology so it’s very interoperable. You can plug it into your existing CRMs, whether it’s Salesforce or HubSpot or we can customize it. We’ve private labeled it for several of our agents as well. We can private label it, stick your logo on it and make it your back office. It’s robust and there’s nothing else like it. We had the vendor relationships already contractually in place over 400, like I said, worldwide, but why not try to automate as much of that sourcing and procurement process for us as well as for the clients directly?

JC: What kind of industries use this more than anything? And what size companies within those industries are typically the ones who are using this kind of for DCITRAQ?

Dany: Well the beauty of the line of work that we’re in is in terms of where the demand comes from for data center or cloud, 200 of the 400 vendors that we have signed up, also offer cloud-based infrastructure as a service. It’s really any business from any vertical, especially right now in this post pandemic world that we’re in, all these businesses that didn’t really think about virtualization before, they’re now thinking about it. Digital transformation, used to be a nice have, something to talk about. Now it becomes mission critical and essential. We’re seeing a lot of activity from every vertical. You can imagine everybody needs to host something in a data center or co-locate something or managed hosting or in the cloud – everything, not just your website, your enterprise portals, your own SaaS platforms for your company’s private SaaS platforms, they’re hosted.

Dany: The public SaaS platforms, they’re hosted. You all realize, even Salesforce and HubSpot, they’re taking up colocation, that’s how they’re offering that SaaS. That software has to reside on physical servers somewhere in the data center so we’re in the world where the rubber meets the road. I’ve said this often and it’s really just the whole ocean of technology is going to raise the demand for data center infrastructure services and has been.

JC: Well, it sounds like a pretty incredible resource. What kind of barrier is there to entry though for DCITRAQ? What kind of price point does it have? Is it just for small businesses be able to use? Is it for big businesses? Is it a $1,000 a month? Is it $5?

Dany: Sitting down, this is the part that most people are like, “What?” It’s actually completely free to use.

JC: Oh, really?

Dany: Yes. Because the way the revenue model works for us is you can go ahead and search and compare side by side all these vendors, 400 plats worldwide, look at their capabilities, download from the knowledge base, the built in knowledge base, any of the white papers, case studies, all the marketing collateral you can imagine is all built in there. Integrated CRM. You can gather all that, build your RFP and register it with all the vendors that make sense, then match your requirements. And once you decide to choose and contract with one of the vendors you found through us, through DCITRAQ, we would get commissions from the winning vendor from the sale side. Really it’s completely free from the buy side.

JC: Your vested interest isn’t in any particular vendor, you just want to provide the resource and they will reward you with saying, “Hey, thanks for bringing us a client. Here’s a percentage,” or whatnot.

Dany: You hit that on the head. We didn’t even rehearse that. That’s perfect. You hit that on the head. We are vendor agnostic, truly vendor agnostic. We’re neutral in the way we do this because we get paid a success fee regardless once you contract with a vendor. We try to take a customer centric approach. All the resources, all these tools is to make the customer experience as dynamic and as comprehensive as possible so that they come and use it and see value in using it. But it will dramatically change the way you source and procure data center infrastructure services. There’s no doubt about it.

JC: Well, and what industries do you see typically using this? For example, I would imagine software companies obviously need to have this kind of space. SaaS companies and whatnot. Is there any type of industry that isn’t obvious that would be using this? We know government agencies will probably use them, but other than again, other than government and let’s say SaaS, who else is using on a pretty large scale anyway, an actual real need to their business who really has to find these colocation? I guess beyond putting something on Google servers or Amazon or whatnot, what industries are really, that would surprise the audience, are using your services?

Dany: That’s a great question. The biggest surprise is who the biggest consumers are of colocation and data center, cloud providers. All the analysts. It’s very funny.

JC: I love that answer.

Dany: Years ago when cloud started coming out as a concept, I can’t tell you how many articles I would read by Gardner and Handle, big time analysts saying, “This is the end of colo. If you’re in colo, get out now.”

JC: Where would cloud sit though?

Dany: Where does the cloud live?

JC: In the clouds itself, it has to literally sit on servers.

Dany: And I think part of the confusion is also, the word cloud is so broad and so big. There’s public cloud, the big three, AWS, Azure and Google. And then there’s hundreds, hundreds of private cloud providers, SaaS providers, infrastructures of service providers, all these different cloud based platforms. They all need data center services at one point in time. And even the public cloud players, they’ve grown so fast that they’re not able to keep up by building their own. I think initially, Google built a million square foot facility thinking they were going to be able to do all this, but things have changed and they’re growing so fast that they’re the biggest customer.

JC: Yeah. Even they have to outsource now. Yeah, absolutely.

Dany: Yeah. They come and they have colo in all of these data centers and part of the drivers in the way the architecture, the IT architecture has changed is this whole million square foot data center in one spot in the country doesn’t make sense anymore. As demand has pushed out to the edge and because of edge computing architectures as a demand driver, it’s forced a lot of providers, a lot of these companies to have smaller micro data centers and micro colocation, two, three racks here, there. Three to five racks in multiple locations, closer to the edge, closer to their customers and subscribers. Yeah. These are part of the dynamics that have made the man for our world even greater than it already has been.

JC: Well, and obviously right now at the time of this recording, we’ve got a pandemic going on, mass droves of companies are moving to remote, because they have to. There’s not offices that people can really congregate in. How has your company either adapted or benefited or helped whatnot, given the current situation that we’re in with all this?

Dany: Yeah. For us as a, I’ll start with us as a company and then I’ll move out in concentric circles. But for us on day one, when we had to quarantine, there was no switch to flip over. We were already a completely virtualized organization. Our back office, we use DCITRAQ for our back office already cloud-based. Our accounting system, which is integrated in DCITRAQ and gives our agents commission snapshots into how much commissions they’re earning on the deals they’re registering through us, that’s been cloud-based for a couple years, our accounting system. Everything, our CRM is cloud-based, our phone systems, it’s been virtualized for 15 years. We’ve been doing these types of Zoom calls.

JC: You were already set up to weather this storm regardless.

Dany: Yeah, exactly. For us, as a transition, as a company, as a staff, it was very seamless and effortless. However, our clients not so much and I don’t mean small clients, you asked me about segmentation earlier. We’ve got a multi-billion dollar publicly traded company that is a 100 years old, 60, 70,000 employees worldwide, they have traditional phone systems. Right now they’re all at home using Teams as a band-aid. Microsoft Teams as a band-aid. But if you call their direct line, it’s ringing in their office and they can’t get it. It’ll send them an email with the voicemail, but it’s not completely integrated. We’ve been using the UCaaS platform, unified communications as a service, cloud-based telephony. We’ve been using that for, like I said, 15 years and this is part of the solutions now we can sell. We’re able to kind of sell everything we’ve been using. We walk the walk and practice what we preach and then we can help our clients with all those types of products and services.

JC: Well, it’s funny that you mention about how even the big companies like Amazon or whatnot, they have their own data centers, but even the big companies are having to find these collection of smaller ones basically to help offload some of this. My dad, he worked for Sun Microsystems for 20 years and I grew up in the Bay area and he worked in those kind of server farms. He worked telecom and I was in those big computer rooms with giant server racks and everything and the hum and the fans and everything. And I remember thinking, oh one day, this all gets smaller and it did, but then it grew back into itself on scale.

JC: Even though each server rack that the data that it could handle back then it can now be handled in this big, but because of the demand, you’re back to this size again. Those rooms look no different than they did before. They just hold more data now, which is really funny. And it kind of also reminds me, you know that show Silicon Valley?

Dany: Yes.

JC: That company? Yeah. Remember they had that idea about everyone’s cellphone being its own independent, almost cloud style server, where the internet now existed as a collection of people’s cellphone data and pinging so that people could take back the internet instead of it being owned by these big companies and whatnot and them owning the data and whatnot. It was a way for people to have their own private internet, even though that is in itself, although technically fictional, not realistically fictional. Again, the name of this podcast is the Future of BizTech. My question to you, Dany, is taking even a fictional comedy show concept like that, do you see this being a possibility? Because colocation, what if people became the colocation? What do you see as five, 10 years out in your industry, given the trajectory it’s going on and the demand?

Dany: Yeah. I see really no end in sight for demand for traditional data center services. Because again, as cloud continues to grow and more and more providers come into that arena, they’re all going to need physical colocation at some point. And while that does sound good, what you said about the show, realistically speaking, you really can’t circumvent data centers and believe me many have tried. There’s been theories of putting out a network of satellites, but here’s why you need physical terrestrial connectivity. These data centers are the hub where all the fiber and all the different carriers and the backbone providers terminate. Some of these meet-me rooms in these carrier hotels have upwards of 30, 40 different carriers that come into that meet-me room. You can’t replicate that kind of network redundancy on a phone or a personal device, or really even on premise, which is why so many enterprises have outsourced their on-prem data centers to colocation facilities.

Dany: Some of the biggest companies have had data centers in house forever and they can’t keep up. And then of course the next gen type data centers and the kind of operational efficiency they have, the kind of redundancy they have both from not just network redundancy, but power redundancy, 2n+n the number of generators, the type of UPS backup, the environmental controls, the fire suppression in case of a disaster, all the fail overs. Data centers are the backbone of all tech, of everything we know that goes over IP, which is everything right now. And I don’t see that changing at all. And in fact, they can’t build them fast enough. I saw an article in a finance and real estate journal talking about how much VC money and private equity money is going in right now in the middle of this pandemic into building more and more data centers. Follow the money and you’ll see.

JC: I have a question of evolution of technology evolution here. This is just, I want to get your opinion on this. This idea, just entered my head literally in real time right now. You have people who are building out their own server farms for bitcoin mining. With the demand of colocation right now, because like you said, they can’t build them fast enough, do you see a possibility that people who have these server farms for bitcoin mining, do you see, is there any way for them to double down or to transition? Would they make more money being an outsourced colocation farm for big companies versus mining for bitcoin, by any chance? It’s kind of the same setup in a way, isn’t it?

Dany: Yeah, and again, it’s funny, we didn’t choreograph this at all, but we’ve had tons of bitcoin mining companies come to us.

JC: Really? Okay. Yeah.

Dany: Here’s some of the challenges.

JC: I swear to god, to everyone on listening. Our pre-show consists of two questions and none of these were it.

Dany: So with bitcoin mining, it poses a whole set of different challenges for traditional colocation providers. Historically they punt on those deals. They’re actually no good for them. They don’t want them in their data centers for a whole host of reasons. Historically, the payment history, they tend to default on paying. They are power hogs, those rigs, those bitcoin mining rigs are power hogs and give off and disperse a lot of heat. They’re terrible on a data center. However, there are some providers and we are partners with several that will absolutely take those on and they may have to prepay a few months in advance and get creative with the way they do the contract.

Dany: But what’s happening as well is now on the sell side, on the supply side, there’s some speculative investors that are getting together and building purpose built data centers just for bitmine coining because you don’t really need with those data centers, they don’t want to pay premium dollars anyway, for a next gen tier three, tier four data center. There’s no need for that for bitcoin mining. You don’t even need that kind of network redundancy. Really they’re building these data centers now that are designed to attract bitcoin mining companies and those rigs and they’ll host them all day long.

JC: Well, but I guess my other question then is the reverse of that then, which is, could you see a situation and a future where people in their own homes, for example, have kind of the do it yourself bitcoin miners. That people have server racks in their basement or something, kind of doing it themselves. Do you see up scenario that’s possible where this person who has their own server set up in their house mining for bitcoin for themselves, but then a company like maybe yours, for example, a colocation company says, “Hey, you have five server racks and you’re doing this. If you put this software, this security encryption software into your and let us use your physical servers as part of a way to offload securely our data,” and you would pay them.

JC: Could you see a scenario where a colocation company could actually be sourced by thousands of just independent people who have their own smaller physical servers set up and have a thing where they’re basically mining them and then selling that space as a whole to clients? But it’s being sourced from thousands of teeny tiny server racks that are independently owned, but again, secure because of software whatnot. Do you see that as a possibility of converting people who would be normally doing it for bitcoin, but they’re saying, “Hey, I’m mining Bitcoin, but I can make more money renting my server racks to this colocation company.” Do you see any scenario where that would be possible?

Dany: You actually touched upon something that is happening already, but not by the colocation providers. There’s bitcoin mining companies that actually have products and little light applets and they’ll go out and they’ll sell the concept of, hey, download this and mine on your PCs, on your computers. And they build their network and whatever processing power that your PC is providing and that’s the kind of bitcoin mining and they build this whole network. The co-providers want no part of that. But what is happening is to really scale that business up, you’re going to need to go into a data center. Yeah. You can’t possibly match that kind of processing power and then also the kind of availability and reliability, because now you’re dealing with consumers and their computers.

JC: You can support them, but they can’t support you.

Dany: Got it. Exactly. If you really want a world class bitcoin mining operation, you really should look into having it in a data center. And then you can still go out and sell the software to clients to install on their machine. But you need to have those rigs redundant.

JC: Well, who knows maybe the next billion dollar idea is someone who solves that problem. Maybe someone comes up with a solution one day. Let me ask you a little about yourself personally. I ask this to all my guests, what did you want to do when you were a kid? What did you want to be when you grew up? And then how did that transition into what you are now?

Dany: Yeah, it’s actually a funny story, how I got into this business. Without saying my exact age, I’m a product of the eighties and the era of the movies Wall Street with Charlie Sheen and Martin Sheen. And I wanted to be an investment banker like every other kid at that point that I knew anyway, in the eighties. I actually pursued an MBA in finance in international business from NYU, Stern School of Business. And then in my senior year, which the year was 1999, this whole internet thing started coming about. And even NYU didn’t know anything about it so they had just created a department my senior year called eCommerce of all things. They didn’t know what else to call it so they called the department eCommerce and they had all these different classes. I had a bunch of electives still available so I took all my electives from this department because I was really always interested in tech.

Dany: This was not, it wasn’t really a career path, early eighties. Again, you go into investment banking, yo go into banking. And this is, if you look at my background and my bio, I did work on Wall Street. I worked at JP Morgan Chase. That was a career path, but my heart was always in tech. And so I took all the electives from those classes and one such class, my senior year, big lecture hall, everybody was interested in it. There had to be at least two, 250 students in this lecture hall and they didn’t have a coursebook. There was no textbook. Basically our entire syllabus was every week, they would bring in a dotcom CEO in 1999, because imagine that year and they would come and speak to us about some great dotcom idea that they just got – VC financing for and so on and so forth.

Dany: One week they brought in this guy, at the time, early thirties, relatively meek, mild mannered guy at the time. And he was telling us, they just secured series A and series B VC financing for his dotcom and this and that. And they’re going to be selling whatever online. We all line up after class, like we do with every guest speaker to ask a few questions. And finally, when it was my turn, I said to this guy, I said, “Look, I’m not very technical. I’m more on the business end, more of a business mind, but I really want to get in on this internet thing. Do you have any words of wisdom for me?” And he says, “Yes, one word, infrastructure.” I said, “Okay great.” I had no idea what that was.

JC: Thank you.

Dany: I’m in my twenties, met my friends at the bar in the Village. The following week, I go up to the professor and I say, “That guy we had last week, what was his name?” The professor goes, “Oh yeah, Jeff Bezos.” I said, “Yeah, him.”

JC: How did I know? Of course it was Jeff Bezos. Of course.

Dany: He said to me that I should look into infrastructure. And the professor said, “Well, we’re actually covering that in a few weeks. Do you want to start reading ahead?” Well, I started reading ahead and never looked back. That’s how I got into this business, really. It was one word from Bezos and the irony is for years, as I was building this company up, I was wondering to myself, what’s he talking? Why did he tell me that? They’re not infrastructure, they’re a retailer, they’re an online retailer.

JC: He had the plan. He had the plan.

Dany: Where he was that he said, “That’s where it is.” And now he’s known as the infrastructure king with AWS Cloud. It’s amazing, he knew back then, he had the plan.

JC: That’s awesome. Well, one of my questions that was going to be next was what’s the best piece of advice you’ve ever gotten, but I think that covers it. Who were some of your mentors kind of coming up? Is there anyone even, just personally, whether anybody recognize the name or not, isn’t really important, but I’m just curious, who really helped shape what you’re doing right now?

Dany: Sure. From the kind of in the trenches, the influence really for me comes from some of our channel partners. Some of our agents who were out there on the client premise, they’re the ones meeting and interacting with the clients, seeing the need and we have great relationships with them and we end up learning more from them. A lot of what we’ve done, DCITRAQ back to kind of come full circle, why that even exists, why did I build that? It was really demand driven from our partners that he said it would be really great if I can access this on a phone. It’s also accessible on their devices. If I’m going into a meeting with a client, I want to be able to search right away, who are the data center providers in Singapore?

Dany: This is where they need and Luxembourg and Amsterdam. And I want to know what they offer those providers so I can sound intelligent in the meeting and be informed. I want all that information, all that power at my fingertip. A lot of that knowledge, the feet on the street we really get from our partners. It depends, from marketing, I like to follow Seth Godin. I think he’s great from a marketing perspective, very original. There’s different disciplines as I’m sure, you know, being the CEO, I’m responsible for not just the technical piece here, I’m the acting CTO and the acting CFO at times and got to wear a bunch of different hats. But yeah, I think, our customers are out there doing it and we’re just enabling that. We’re either enabling the sales process for our agents or we’re enabling the digital transformation of our clients. I think that to me is the biggest influence for me.

JC: Coming back to DCITRAQ really quick here, and how do you spell that? Is it track C-K?

Dany: DCI like data center infrastructure, track T-R-A-Q.

JC: Oh, got it. T-R-A-Q. Okay. Got it. Where do you see that going? Right now it’s obviously you said it’s a pre-service. People can go on there. They can help identify the right vendors for themselves for when they’re offloading for their colocation needs and whatnot. What’s coming down the pipeline for DCITRAQ? Is it going to stay that way? Do you have future plans for it to have more features? Again, we love the SaaS stuff here so tell me a little about the future of DCITRAQ.

Dany: Yeah. It’s a living, breathing thing at this point because we constantly, we have in house developers. We don’t even sub that out. They’re literally on payroll. We’re constantly improving it. Adding modules this year. Early this year, we finally went live with the commission piece. The commissions module that allows the agent partners that use this on behalf of their clients who get paid from us for the winning deals, they now could see every month their commission statement, they know what they’re going to get paid each month from us and so forth. Now that’s fully integrated and our own staff can also work with our cloud based accounting system, right through DCITRAQ. That’s done. Now, we’re starting our metrics and reporting module. There’s going to be all kinds of awesome data mining, very powerful data mining and recording features for all three types of users, the client, the vendor, and then the agent in between who’s brokering that as well and as well as our staff.

Dany: We kind of are same user type as the agent. We basically have some of these same features. There’s a lot of reporting there that they’re going to be able to use. For the vendors, for example, they’re going to be able to see the demand where it’s coming from, what types of products and services seem to be trending, their own close and win ratio, where they’re losing, by what percentage are they losing? Maybe they should sharpen their pencils in pricing. They could see even down to the market where they’re off. And then conversely for the customer, they’ll be able to have at their fingertips, all kinds of historical pricing data and pricing metrics so they can actually do budgetary exercises and know before they even build an RFP and go to market with it, what the market looks like. They can really get a good pulse on the market. And we’ve got 21 years of data. It’s just a matter of formatting that in a way and then publishing it in a way that’s digestible for all these different users in DCITRAQ.

JC: Well, that’s awesome. Listen, I’m fascinated with it, I got to take a look at it before we had gotten on the show. I guess my last question is, tell me the one minute version of you mentioned cybersecurity earlier and that’s a big deal right now. Obviously, people are seeing intrusions on their email, on their servers. I mean, government agencies, corporations, you name it. How does DCITRAQ help people on the cybersecurity side? Does it list which vendors have certain levels of security? Are you showing being transparent with that so they understand what they’re getting into?

Dany: Yeah. Same concept. It’s the same engine for data center and colo and cloud providers, but apply it to cybersecurity. On the sell side, we’ve got cybersecurity vendors all signed up under contract in varying categories too. Not just companies that can help with threat detection, intrusion detection, or DDoS attacks. There’s so many aspects of cybersecurity. We’ve got the whole gamut covered of every type of provider and then comprehensive providers as well, that may touch upon different products and services. That’s on the vendor side. On the buy side you come in, you put in all your requirements and build an RFP or RFQ and then the software helps you almost like match.com for dating, if you will, or cars.com and trying to figure out which car is out there that meets your requirements. Same concept, really, it’s a matching algorithm that then compares all of your requirements and you can weight that. And what’s important to you and what’s not.

Dany: And then it’ll come up with the short list and then you put that out to bid with all these different cybersecurity vendors and whomever you close with. Again, we get commission like a salesperson would if you called their 800 number of a security company directly. Yeah, it’s really powerful and it allows, again that one stop shopping. Hate to use a cliche like that, but really under one roof or one software platform to be able to handle all of those things. And especially now that cybersecurity is such a major decision driver in how you colocate, where you colocate and how you architect your IT infrastructure. It’s a major driver. The CISOs in these organizations are involved and some of them were driving those decisions. That’s why we kind of integrated that. Again, out of necessity. Necessity is the mother of invention. And that’s how we’ve gotten to where we are, is just read and react and know what’s being asked for, what’s necessary, what’s a problem that’s really solved and then solving it.

JC: Well that’s awesome. Listen, I really appreciate you coming on the show. You’ve given a ton of really practical advice and probably eye opening stuff, as far as the colocation environment goes. Because a lot of people don’t really understand it that well. I want to thank you for that. How can people get a hold of you either directly, personally, if they wanted to reach out to you. And then also the company.

Dany: LinkedIn, for me, I’m always on LinkedIn. I’m very active on social media and I’m also on Twitter, so you can follow my account, Twitter is @danybouchedid and LinkedIn same name obviously. And then for the company, we also have social media pages for the company, both the parent company, COLOTRAQ and then DCITRAQ itself has its own accounts as well, DCITRAQ. And then if you want to kind of test drive the SaaS platform, the software, you can go on to www.dcitraq.com and give it a try. And if you want to learn more about the company.

JC: D-C-I-T-R-A-Q, you said, right?

Dany: T-R-A-Q. D-C-I-T-R-A-Q.

JC: Got it. Perfect.

Dany: Then COLOTRAQ, also T-R-A-Q.

JC: Awesome.

Dany: That was kind of a consistent thing.

JC: Well, Dany, thank you so much for coming on the show, sir, and I look forward to speaking with you in the future.

Dany: Great. Thanks for having me on, JC.

infinityadminEpi 8: Why Data Storage Matters for Your Business – Dany Bouchedid, CEO of COLOTRAQ