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The IT Masters
An IT podcast unlike any other, where technology’s top leaders share their winning strategies.
The IT Masters
AI Infrastructure & CapEx Discipline: Lessons from Sean Charnock
CapEx discipline isn’t optional when building AI‑ready infrastructure.
Host Robert DeVita and entrepreneur Sean Charnock unpack the operational realities of scaling capital‑intensive tech businesses. Learn why CapEx discipline matters, how to lead through hypergrowth, what founders miss about financial strategy, and how AI, cloud and colocation are reshaping infrastructure.
Download our AI Infrastructure Checklist and subscribe for future insights.
Welcome to the IT Masters podcast, where technology leaders share their strategies shaping the future of IT. Hosted by Robert DeVita, CEO of Majetics, we bring you candid conversations with CIOs, CTOs, and enterprise architects who are driving digital information, from AI-driven security to cloud innovation and IT modernization. We cut through the noise to bring you real insights from the brightest minds in tech. No sales pitches, no fluff, just thought-provoking discussions with the masters of IT. Subscribe now and join the conversation. The IT Masters Podcast, where the best in IT share their journey.
SPEAKER_02:Welcome back to the IT Masters podcast, where we sit down with some of the best minds in technology and business leadership. Today, I'm joined by Sean Charnock, a guy who's worn just about every hat in the tech world. Entrepreneur, CEO, operator, investor, and now chief strategy officer, where he's helping shape the future of data centers and infrastructure. Over the years, Sean's led companies in cloud, cybersecurity, AI, and private equity-backed growth. He's helped scale the businesses to multi-billion dollar exits with names like SoftLayer, Inside Partners, Faction, and more. What I respect most about Sean and why I wanted him on the show is not just his track record, but his perspective. He's seen the game from multiple different angles, and today we're going to unpack that. Sean, great to have you here. All right, Sean, let's start with the early days. You actually came out from school with a finance degree, and then... went right into Efficient Networks. So how does someone go from finance to starting in IT out of grad school?
SPEAKER_00:Yeah, there's a little stop in between there that kind of set a course. I'm from Florida originally, and so I was going to school, finishing up my degree, finance and banking and real estate and all that stuff. Had a, you know, relatively kind of solid thought around. I was doing some work while I was going to school at Merrill Lynch on some credit stuff and I figured out, you know, I'm good at math and that's kind of a path. But then my brother, Will, you might know Will, but he was here already in Dallas and he had become kind of a CTO of one of the early day ISPs. And, you know, I'm not much to kind of sit around, take an easy path. I decided Hey, let's go find a job that's not in your career zone. You don't really have any experience at it and makes you move and probably pays a ton less than what you were being offered coming out of school. So I actually went to work for those guys. And it was, you mentioned Peter Hopper earlier. It was the early days of those ISP roll-ups. If you remember kind of early 2000s, Vario was picking up everybody and a bunch of these other guys. And The job I took was kind of a BD job. I was really quite poor at it, to be honest with you. But I learned a little bit about just kind of the inner workings of what was going on with the internet. Obviously, Will's very technical, so I was able to kind of shadow him on just kind of learning by kind of drinking from the fire hose. You know, the company was on a path You know, it was either going to buy somebody or be bought. It was kind of in that vein. And they were well on the way. And so kind of worked there for a little bit. I wasn't really good at what they asked me to do. So, you know, 21, 22 years old coming out of this, you know, kind of, you know, this more business path. And so we just parted ways after a bit. And then I got to Efficient Networks, which is really kind of the foundation of my career. I like the space. I did come to realize that as a business guy in tech, one, you got to know the tech. You got to kind of get a foundation there. But two is I could really forge on kind of business relationships. That really kind of set a path on, you know, if anything, I've learned over 25 years doing this. It's the relationships you have. You can kind of weave in and out of different companies. But this is small, right? You called the other day. It's like, yeah, I've seen you a thousand times in the last year. know 25 years and you know we probably haven't had dinner together right that's kind of the way this industry works everybody's pulling for everybody but it's based off those relationships so it was a pretty easy kind of get into something um i took over a little bit of sales stuff and then did a bunch of international work and it was kind of the when you're young you kind of raise your hand i tell my my oldest son this all the time which is there is no real side hustle except for saying yes to stuff that you can't do and then figuring it out I was dumb and aggressive. So I was like, before anybody could finish a question, I'd always say, I'll do it. And it kind of put me on a path of really learning a bunch about a business that at 22, 23 years old, I had no business kind of being there, but I was very appreciative that I was able to be. And to this day, I've got a bunch of mentors and people that I really looked up to back then that I now call peers. And I'm real proud of that, actually. I do a bunch of investing and cool stuff with those guys and I think that just sums the industry up as well.
SPEAKER_02:You talked about having that finance business background. You deal with a lot of tech people, right? It's probably especially founders, guys who are startup guys. How much of that business acumen or finance acumen is missing from those guys?
SPEAKER_00:Yeah, I think it depends on... A little bit of background. Most of the tech guys are exuberant about what they're doing from making this thing that nobody else can make or, holy cow, I found a hole in a market and I'm going to go fill this hole. There is a relevancy of slow down before we can go fast. We've got to think about the implications here. A company like Post Efficient Networks, When I went to work at The Planet with Lance and Will and a bunch of the guys that ended up starting SoftLayer as well, people don't realize this, but we were growing so fast that it was actually punitive to the business. And that's a financial exercise to figure out like, okay, CapEx heavy business, I can't grow at any cost at that point because I don't have the money to grow. And so, I kind of joke about this, but Mike Jones, our CFO and myself probably raised money between the planet and software days, because huge CapEx businesses, we probably raise money every day for nine years. I mean, you have 25 grand and, you know, I want to get a really high interest rate. I'll take it. And that was kind of the theory. But there is a gap in that. And I think you have to kind of do it to kind of go like, oh, I didn't know that from a financial standpoint. And so a lot of the stuff I do now from a technical, either board perspective or advisory perspective, a lot of it's about just thinking through the financial implications of decisions and kind of P&L management, budget management, because it can kill you early on, especially if you have a great idea, but you're just going, right? And so there is a gap there for sure.
SPEAKER_02:So you've had your hands in cloud, cybersecurity, customer experience, AI. When you look back at all of those spaces, what has drawn you to these types of companies?
SPEAKER_00:Hard problems. You'll probably laugh at this. I've been in Dallas since 2000, but I've never really had a Dallas job, right? I have a ton of buddies here through our networks where our kids go to school and also who are the local guy that does X or Y or Z.
SPEAKER_02:Everyone knows him. You're the lawyer. You're the accountant. This is
SPEAKER_00:the guy you go to. That's right. You're the HVAC guy. You're the roofer. And those are the guys playing golf on Friday. And those are guys that have real nice lives and everything. I haven't had that. I've been hustling to really trying to cure or kind of work through really hard problems. And it's just a different path. But it is funny that I don't have a Dallas– business organization that makes a lot of sense for me because of that, right? And so we've been around the world. I've lived, you know, back and forth from AsiaPAC for three or four years. You know, I ran a company in Denver for six years while living here. It's just a different perspective. And, you know, I think that I've always just been drawn to the hardest things. As I look backwards, I go, man, I probably could have been a real good painter or something. But that's always been fun too. Let's go challenge ourselves and keep the brain
SPEAKER_02:active. You talk about sort of the hard things. What's the one you wish you would have done differently?
SPEAKER_00:You know, we did some stuff at Faction that was probably early for the market, and then COVID hit. That was a bit of a challenge. But if I think about interesting things, I think about the digital infrastructure stuff, data center stuff, that kind of bounds everything. But when you think about what you're putting it on, when I went and ran a cybersecurity company, it's super interesting. as a guy not from that industry, didn't have the three-letter acronym in my part of you. I employed a lot of ex-Gov, ex-mil guys. There's a mission and really kind of a, you kind of feel like a superhero a little bit. Sounds cliche-ish, it's not meant to be. That was really cool. But when we got to the faction, one of the things, I'm really a data guy at heart. Bridging data into and out of cloud properties, we were early for it. We had some success in it. COVID didn't help us. VMware had some interesting relationship aspects to that. Dell was an investor in us there. I wish we would have had a little bit better. I came in a little later. I wish we would have a little bit more cash runway to do some broader things there because I still believe that kind of the The ingress, egress part of data and keeping it in a solid state to be able to do anything with it from anywhere is really a practical thought. It's very hard. It's very technically driven. That's probably the one area that I would have liked to have had a better chance in terms of a better capital structure to really go after that.
SPEAKER_02:So let's talk about SoftLayer for a second, because it's one of the most iconic stories built it, scaled it to$2 billion plus exit to IBM. When you think back at those years, what's the biggest thing that made SoftLayer work?
SPEAKER_00:Common goal from the people doing it. I think there's a whole backstory there of like how, you know, we kind of started SoftLayer.
SPEAKER_02:Synco to SoftLayer,
SPEAKER_00:May 5th. That's right, 05, 05, 05. We, you know, ironically, we just had our 20-year kind of anniversary or whatever. We looked at each other and said, we did this 20 years ago.
SPEAKER_03:But
SPEAKER_00:yeah, I think we started that company with a mission in between the folks that started it. And we all had a lane. There was no overlap. There was never a drive towards like Politico, who's going to run this, who's going to do that. It truly was kind of push everything to the middle. I mean, We had guys, myself, I didn't take a salary for 18 months. We had guys that had three and four kids that we were, you know, giving gift cards to, to say like, man, we can't really pay you, but take this and go, you know, do the right thing. And, and you just bartered with each other and it just created a camaraderie of like, we're not going to fail. We didn't have, we didn't have shit going for us. Yep. You're good. In terms of experience or whatever, I always, always tell everybody that, um, You know, I pitched the story to investors probably 200 plus times, and I got 200 no's. And the no's were really this. One, y'all are real young. We were only, you know, I was only 27 or so. Between the group of us, I mean, you know, you probably had a bookend. Mike Jones was our kind of, he was the godfather, I guess. But, you know, everybody else is 25 to 35-ish range. Got to know for that. Got to know because, obviously, when you leave another company and they like to put some clamps on you, cause some grief. And really, the main thing was, you've never proven it. You've done some things individually, a few of you, but not collectively as a group. So go make something, and then we'll come back and give you money. See, all that is, we'll give you money when you don't need it, right? But that actually fueled us to be very, very thoughtful into how to spend money, how to raise money. Like I said, we raised money forever. um but when you when we got later on you kind of looked back and went like it worked because everybody just wanted to go that way and there was no kind of i need to do what you're doing i don't like what you're doing there was there was so like it it it was just an environment of like we're gonna gsd our way to to the finish line and um you know hard to replicate seeing some businesses that i wish had that too but um You know, it wasn't easy, but it was fun.
SPEAKER_02:Yeah, the culture there is something for the ages, right? I don't know that they make people anymore who work that hard. You know, I... We had a guest in here before, and he was head of infrastructure for Hotels.com. And that place was literally put together with duct tape and string, right? But I remember when they were my customer at AT&T, I'd be in their office at 4 o'clock in the morning, and these guys are still grinding at it, right? They've got 12 empty monster cans at their desk. These guys were hardcore people. And I feel the same way about the folks that I met at SoftLayer, right? They didn't care what time it was. They had to get shit done, and that's what they did. I don't know any company that would be able to put a tattoo artist in the lobby and have people come and get their company logo tattooed on them forever. Like the culture, it was crazy what you guys built there.
SPEAKER_00:It was, and it was really built off of, again, that common theme of it wasn't a class-based system. It wasn't a, you know, you guys do those things over there and we'll never talk. I mean, it was high comms. high transparency, high collaboration, the good, the bad, the everything. The tattoo thing's funny. I get the numbers wrong, but I imagine there's about 27 tattoos. And the basis was this. We had a really kind of emerging, youthful kind of crowd in the workforce. And it was, you don't have to get our logo, but our logo color scheme and style has to be present. So we had guys with flames coming out of the logo. We had guys and, you know, I'm not a tattoo guy, so I don't have one on me. Lance has one. I bet. But there's, you know, 26 other people running around the world that have this like forever ingrained on them. And I think it tells a story, right? I mean, I think it's material, it's matterful. And, you know, probably one of the more proud, you know, accomplishments in my life is when we sold the first bit of software to GI Partners. I think we made something like 90 people, millionaires at that point. It's crazy. And that's guys that, you know, 25 years later, they're paying for their kids to go to college based off of that event, which is awesome, right? So...
SPEAKER_02:Good stuff. So you've been a part of big exits multiple times. When you're inside of those companies, what's the mindset that a leader has to have to scale to be able to exit?
SPEAKER_00:Yeah, I think it spans different things. I think you have to have a foundational kind of your shit together, excuse my language, meaning whatever tools you use, whatever you're driving the business, there has to be a cohesiveness. So when you're compiling data, when you're using multiple systems, they've got to be right. Data integrity is a big charge for me now, but also many times in the past about just making sure that when you're telling a story, You're not really making up the story. It's actually a real story, right? And I'm not saying that people do that with nefarious reasons, but a lot of people, you know, it's the old adage, like I got a box and it's full of receipts and somehow my accountant is going to keep this, right? No, you have to build a company and you have to build it from the perspective of this. We're building it for the long term, even if it trades in the short term. Because I've seen many businesses have this theory, like we're going to build it so we can sell it. There tends to be a cliff on that, right? Which is you're making bad decisions about short-term theories. And then when something doesn't happen in the short term, you kind of look up and go, shit, we're screwed, right? So you got to build it like you're going to run it forever. And if you do that, if you get the right people kind of kind of aligned to that. I think all the systems kind of tell the story and can help kind of spur yourself into an opportunity when it presents itself.
SPEAKER_02:I spent some time over at DH Capital post-exit. Tell us about sort of that atmosphere because it seems like they were in the middle of every deal that got done for 10 years. year period of time.
SPEAKER_00:Yeah. Yeah. I mean, they really were the boutique banker of choice for, you know, for the entire kind of all the way, you know, web hosting all the way through kind of heavy data center side of that. And they did, you know, kudos to them for kind of forging that path. That was fun for me because two things. One is from an operator's perspective to go see the other side of the business. That was important for me. Peter, you know, was... Really good to us from a banker's perspective while we were at SoftLayer. And then the opportunity to join that team with Dean and Joe and all the other guys there really allowed me to kind of see kind of the inner workings of the banking side, which was great, just given my roots and kind of education around the finance side. Got to do some cool things there. I really liked their culture as well. It was a work hard, play hard mentality. And some of the analysts have become operators themselves over the time, but really kind of a strong bind to the industry that we've all kind of been in and around. So that was really fun. Started a couple of vehicles out of that, like SAS Capital, which is now on its fifth fund. Awesome vehicle for entrepreneurs. Got to learn how to kind of think about that as that was coming to fruition. And I stay really close with those guys even to this day. I actually had a call with Dean this morning and talked to him about something.
SPEAKER_02:Is there a deal that you were working on while you were there that you wish you would have done but you didn't do?
SPEAKER_00:Yeah, I'm trying to think. I don't think there's one that I feel like I missed there. I definitely missed a few in just general. But there everything was relatively well thought out, well vetted. So I don't really feel like we missed anything there because that was just, you know, the volume was there, right? I mean, being the fact that they really were the premier banker at the time, yeah, they had to pitch and win. And when it got to a certain size, you know, they could definitely battle some of the larger groups. But I think everything kind of laid into it. where it should have been during that time. I was there for about 15, 18 months or so.
SPEAKER_02:So over your career, was there a Shark Tank ring moment?
SPEAKER_00:What's the ring part?
SPEAKER_02:The doorbells where they
SPEAKER_00:could have invested? Oh, gotcha, gotcha, gotcha, yeah. Yeah, I don't want to really name the company, but I'll tell you that... I had an opportunity to go be a C-suite at a company that I really liked. And they were very kind to me in terms of bringing me in to talk to them. And I just didn't do it. There was something that triggered a reason for it, but nothing material. And then I looked up and about two years later, they raised$2 billion in capital with like 80% of it going to management. back out, right? I mean, you know, for a person that wouldn't have founded it, you know, it would have been significant, right? I mean, like, just it would have been almost like founder money, right, at a certain point. But that's from the monetary perspective. But I really like the company, too. It's just poor timing on that, right? So
SPEAKER_02:you've done sort of the entire application layer at some portion. And now you're at data centers, right, which isn't the most sexy thing in the world, but sort of makes the entire world work, right? So what was the thought process of going over to Center Square and what was attractive to you about that? Because it's not as sexy as some of the other things that you've done before.
SPEAKER_00:Yeah, it isn't from maybe a cover perspective, but if you think about what's going on in the world around everything, I mean, anything kind of digital transformation, AI, all the kind of localized things around inference and large language models. It's all driven by the data center world, right? And so, although kind of real estate at its base in terms of space, power, connectivity, there's some really interesting applications that are happening inside the data center that you're fueling, right? So you can take it from, I always call it the data center It's really like a digital manufacturing facility, right? And to be at the basis of that, you get to see some really interesting things that are happening. You get to see a glimpse into the future a little bit about what people are developing. But you also get some pride in the fact that if you're of size and scale right now, you're servicing the world's biggest businesses, right? And so there's something to be said about being trusted by the world's biggest banks, the world's biggest healthcare companies or, you know, blah, blah, blah. So there's something that, you know, kind of fuels the piece that, you know, people on the outside say, oh, it's just, you know, brick and mortar. It's a little more than brick and mortar. And when, you know, when my kids are asking me, what do you do, right? It's like, well, when you go to the internet and you type dub, dub, dub, whatever, I mean, think about you're kind of at the base layer of that. And that's pretty cool for, especially what we've seen over the last 25 years to still be I did a chat with Phil over at Nomad here recently, and they were asking, would you tell kids that this is still a thriving industry to get into? I'm thinking as mature as we think it is, it's still got so much runway here in terms of the growth that's in front of us that it's pretty exciting.
SPEAKER_02:How do you keep up in that space? You've got to be able to build fast. You've got to get in line for switchgear. You've got to get in line for generators. You've got five guys and a trust fund can go build a data center. How do you differentiate yourselves in a market that is just getting increasingly more crowded and harder to get components to build?
SPEAKER_00:Yeah, I think... I can't remember if you went out to PTC or not this year, but I know you've been there.
SPEAKER_03:Yeah,
SPEAKER_00:I passed this year. Yeah. The interesting part to me was 10 years ago, you go to PTC, and it's one banker, one lawyer, and a bunch of data center operators or network guys, really. International minute people. Yeah, you saw people trading minutes on the phone, which was insane.
SPEAKER_02:At the deal
SPEAKER_00:desks. And then this year you go and it's 50% bankers, 50% lawyers, and then whatever. 50%
SPEAKER_02:hyperscalers.
SPEAKER_00:Yeah, and what that means. But the other interesting part was there was a bunch of people running around going, hey, I've got land, I've got power. And in my head, I'm just thinking, but for the last 25 years, the same people that you and I both know, we're all running these companies now. So where are you going to augment that? Where's the workforce that's coming in that says, I've built servers at midnight because we were growing so fast we had to, right? Where's the groups that are driving that? And it's an interesting perspective to your question, which is, how do you deal with all that? I think... There's going to be a divide between those who know how to run these companies and those that don't, but just have money. It doesn't mean it's going to all go by the wayside by any means, but you're definitely in kind of the pole position when you've got real operators of these companies who understand real implications of these decisions versus just some land, some power, and a bunch of money. We'll see how that kind of shakes out, but I definitely learned the term land banker and thought that was...
SPEAKER_02:I've seen over probably the last 24 months, you've got people taking down a lot of space with an AI offering that may or may not be able to be monetized because they were able to get funding for an AI idea and try to bring it to market. My point of view on some of that is that, hey, if you can't monetize within 24 months, your GPU is going to be obsolete. You got to go back to the bank and get more money, and you're probably not going to get it. And we're going to have pockets of stranded assets around the country, similar to what we saw maybe when Bitcoin was$10, right? And you had a big grab of power for Bitcoin miners. Do you think that thesis is correct?
SPEAKER_00:I think two things kind of emerge from this. One is the building of the data center to support from a power perspective. That's not in vain, right? So it doesn't matter necessarily that, you know, who's utilizing that going forward. There's going to be a use for that. And so from a digital build perspective, that's great, right? It's kind of juicing the market, so to speak. I do think you'll have your natural winners and losers in that. I think that You're right. You know, a flawed business model will get shown at some point, right? And there's a bunch of people that, you know, again, it's almost like land and power where they're going, I've got a bunch of GPUs, no real operating model, but let's go to the business and let's throw this together. I do think you're going to see a little bit of, especially on the application side, a bunch of these guys who are just chasing kind of a quick win. And that quick win doesn't come often, especially when you're talking about profitability, you're talking about real cash flows, or anything like that. I think there's going to be some carnage. But I don't think it hits the infrastructure side as much as it does hits the finance side of people who are financing these. And it really just creates kind of this strange category of the as well as. And I think you're going to have your emergence of your really core offerings. that are going to exist and kind of live in the GPU as a service space and kind of thrive there. And then you're going to have some people kind of fall off on the side there.
SPEAKER_02:What have you seen from a valuation perspective on some of these big box data centers, right? You're talking, I don't know, 200 megawatts or 100 megawatts going to a single customer, right? Because back in the day, if you didn't have customer diversity, it was just worth less, right?
UNKNOWN:Yep.
SPEAKER_02:Are you seeing that change now because people like Meta and Amazon and Microsoft are taking down those footprints? From an evaluation perspective, does it stay firm because of who's taking it as opposed to, hey, I need three or four of them inside a campus or a building?
SPEAKER_00:Yeah, I think especially for the big box builders that cater to a single or very small group, amount of customers, I think it's about credit, right? And at the end of the day, if you've got a 40-year lease with a Meta or a Microsoft or an Oracle or whoever it might be, it's a lot different than saying, hey, I've got a 15-year lease with a GPU as a service company that has a five-year business plan, right? And so the balance of that is just... really how I think you're seeing valuations kind of match that in terms of credit grade customers that are singular or dominant in a site that you're building these 100 megawatts, 200 megawatts of gig, I've heard in some places. That can support that. And I think people get comfort with that from a valuation perspective. I think when you start degrading against some of the credit, I think that becomes a little challenging on the valuation side. So You know, different perspective. Like, I've never built a data center for a single customer. That would be a little bit weird for me. But very close relationships with folks that do. And, you know, I think they focus on really that grade A credit type customer that can underwrite that and get a lot of comfort in that.
SPEAKER_02:You brought up Oracle, and I'm still trying to figure out the amount of consumption and power that these guys are taking up, not only in the US and globally, right? When I look at, you know, what I consider a hyperscaler, right? I measure, and might be my own wrong measurement, right? Of how many ports or how many direct connects customers are taking to there, right? So if I look at, you know, like a mega port, right? And if you look at mega port, let's assume that, hey, 70% of these ports go to AWS, and 25 of them go to Azure. And then the other 5% is probably Google, Oracle, Alibaba, and probably somebody else. That's how I measure utilization or adoption from a hyperscale perspective. When I look at that 5%, I don't understand how Oracle can be taking down all of this space and power and not having the outside world connect to it.
SPEAKER_00:Does that make sense? It does. They've got an embedded business for their own use case too, which is materially a large portion of it. I don't know the inner workings of Oracle well enough to speak about their business model, but they are taking down a ton of space and power from all kinds of providers. I think running OCI for them is their natural attraction to that end user customer. And so it becomes kind of an engine to themselves and then a partnership to the others, right? And so the on-ramps into some of the other third-party hyperscalers and network providers, I think they kind of fill a bucket, right? And that bucket is we're going to go, you know, kind of connect to that end user base with OCI and kind of put our stake in the ground as the premier cloud provider for that application. And then and then they look at interesting partnerships across the board. The dynamics of those partnerships are always strange to me, which is, you know, they like each other. They're not like each other. Right. And it's always weird to me. Like you read these big titles on these on these news articles. It's like, you know, Oracle and Amazon team up for this. And you look, you just kind of go like. interesting and not how I would have thought it, but somebody smart there is figuring this out. But it is interesting that when it'll be interesting in like five years to see how these partnerships either really solidify Or they were all tricking each other and they're going to kind of spur out and go, we're never partnering with anybody again.
SPEAKER_02:The folks that we do see going over to Oracle are people that have competing business models in some fashion with AWS and Azure and like, hey, I want my infrastructure to run on something else. That's a differentiation point for me inside of the market.
SPEAKER_00:And we talked about earlier, one of the things you said, like, what do you wish you would have done better? If you just think about that concept, the idea of like not having your data locked into any of these single clouds, but giving you access to all of them was really a concept that even today I think resonates as it relates to you really want, you know, control your own destiny. And so what you're saying, I think you hit it is I got to go where I feel good, comfortable, where I don't feel like I'm competing necessarily internally. And people are having to make independent, isolated choices, because there's really no data abstraction, right? There's tools that are starting to get there that are good. But that is definitely a criteria for why people are picking singular clouds,
SPEAKER_02:right? I was at an advisory board meeting a couple weeks ago, and it's a service provider, and their entire architecture is built on Google. And, you know, they had a hiccup in May, and then I guess this is The outage was last week or the week before. So we're sitting at the advisory meeting two weeks before that. I said, hey, isn't best practice, I read from Gartner, a multi-cloud strategy? I said, well, we're in a single region right now, but we're going to go to multi-region in the next couple of months. We're re-architecting things. And I was like, well, what happens if there's a multi-region outage? Well, the odds of that are very slim. And then boom, last week. The entire thing goes down. And now they are actively rethinking, hey, you know what? We've got to make plans to go multi-cloud. You guys saw some of this at Faction. You want to talk through? Yeah,
SPEAKER_00:I think that that's really kind of a challenge of kind of the Web 2.0, kind of Web 3.0 community at this point around being born on the web, right? Which is... know really a challenge when you kind of say um this is where i'm going to house for the rest of you know and to to do the migration into multiple data centers that are multiple clouds that you know kind of as you're much larger becomes challenging right there's a lot of infrastructure that comes along i think that's why you've seen a kind of a rebalance of co-location and cloud being in a kind of a a hybrid approach i think that it really is a key driver where people are trying to balance out the flexibility and the niceties of kind of utilitarian compute from all your hyperscalers, but still having kind of a ground base where you control your own destiny at a co-location environment. I actually think that you've seen that kind of tide turn over the last couple of years where that makes a lot of sense and that balance is really important for folks. I also think that the hyperscalers, everybody thought it was a race to zero in terms of cost. And I think what has emerged is that it's actually a pretty interesting, innovative race, right? And people don't want to be bound to like, I really like what's happening in Azure from this application, but I can't use it because I'm housed in Amazon. And I think that hybrid approach is giving people access to different features that they wouldn't have if they went 100% native to a single cloud. And so I think that's, to your point, it's like people have to start being thoughtful about this hybrid approach that gives them safety, access to innovation, and also a blended kind of cost model that makes sense for them.
SPEAKER_02:Yeah, and they're trying to build, you know, their marketplaces up, right? You know, how do I keep my customers more sticky by giving them every piece of technology inside of my marketplace? And we just went through a deep dive on this today. And, you know, retiring spend through other avenues, you know, they're really trying to create that loyalty from a customer base by giving them sort of the candy store and go in and say, hey, you need a UCAS provider. You need, you know, backup. You need this. He's like, we have it all inside of the marketplace. Right.
SPEAKER_00:Yeah. And, you know, I think now they have to do it with a little bit more transparency where before they did it by not telling you that they were locking you in, right? And so I think the market is, and it's good for the consumer, which the market is now demanding, like, hey, I need you to show me what's available without me learning it when I try to leave and I can't use something again, right? And I think that's good for the market. I think it's good for the end users who now have very, very kind of clear transparency into what they're getting. what they're giving up by going places. Then they get to make a, you know, kind of a decision at, you know, with all cards up, right? Versus in the past, how many companies do you know that we both know that have started on Amazon or Google or whatever and kind of look up and go, I'm just screwed because I'm so deep into the technology that I don't know how to get out of here, right?
SPEAKER_02:Like Salesforce.
SPEAKER_00:Yep.
SPEAKER_02:So you've led... um across many stages right what's the one leadership skill that you think doesn't get talked about enough but makes a huge difference
SPEAKER_00:um i i think that's a good question um i think not being um aloof to all the hard work that's going on and being outside of it meaning when it's 12 o'clock at night and your team's doing something You need to be present, right? I think from a leadership perspective, it's not do this because I told you. It's I'm there with you. And that doesn't matter the size of the company. That's just an affirmation that it matters. You give a shit like they give a shit. The importance of why you're there. I think also, you know, really driving in the factor of like, it's not a pride thing, but it's really like a, What's your reason for being here perspective right out? I had this conversation with somebody the other day, which was, you know, if you don't know why you're here or you're not excited about being here, let's talk about it. And if that if we still can't get there, it's OK. You can be a great employee. You can be really smart. But if you have no tangible reason that you say, like, I come to work every day because I'm really excited about what I do. I think that's a problem, right? I think it's not good for the employer. I don't think it's good for the employee. And at the end of the day, if you shook someone's hand and said, I'm happy to help you somewhere else, but go find something that's a little more fulfilling, that's important, right? And I think people respect that too. And I've had a bunch of people that later on have come back to me and said, I really appreciated that we had candid discussions, right? And hopefully you figure this out as you get older and You know, life's short, right? You want to go somewhere where you feel like you're making a difference, and you can tell when people don't feel like they're making a difference. And, again, it can be really good employees that just it's not meant for them, wherever that is, right?
SPEAKER_02:We do some work out at TCU, and they've got a great sales program out there. They do great work with their students out there. And I'm sitting there talking to them, and, you know, hey, why do you want to get into sales? It's like, oh, I like to talk to people. You can go work in a call center to do that, right? Or you can do a thousand other things. And I'm just trying to get the point across that, like, hey, you've got to want to win. You've got to want to help customers. You've got to want to make money, right? Those are the things that are going to drive you to go through the 99 rejections to get to the one yes, right? That one yes has to make up for the 99 no's. And just wanting to talk to people isn't going to get you there. You're going to hate your job in sort of two weeks. So that sort of plays on the same premise that you were just chatting about. Yep. Okay, building companies, selling companies. All that comes with pressure and personal cost. What's helped you stay focused through those?
SPEAKER_00:You know, good support system at home. I mean, you know, cards up is a thing, right? I mean, you got to have, you got to, you got to, you know, really be a good communicator on kind of what's happening, the reason you're doing that stuff. You talk about at a cost, you know, one of the challenges, like I said, I'm not a Dallas business guy. I'm kind of a global business guy. That's come at, you know, a lot of three million miles on the back and on the body and, you know, missing things at home and all this other stuff. But I think if you can shape it to really kind of make it meaningful for the why part um you know i always tell tell me you know talk to my wife about stuff about um especially i have a i still have a seventh grader at home i still have a 11th grader or eighth grader in 11th grade or now um I want them to see me work hard too, right? And so there's a value to that, which is I'm sure that it'd be nice to not do anything at all. I don't know if I could ever really do that, but I do want my kids to see me work hard. And that's the other side of the equation, which is, yeah, we've had to kind of manage through missing some things or being really kind of bound to the work thing as a primary kind of thing you have to get done. But it does come in balance of my kids have seen really cool things happen, not just from an exit or monetarily, but from a hard work perspective, from pride in what we're doing, building things. I think that's important. That's how I've made it through in terms of the balance of that.
SPEAKER_02:For any leaders that are out there listening, whether it's a CEO or CIO, What's the one big shift they should be paying attention to right now, whether it's in tech or in business?
SPEAKER_00:Data. You know, if you let your data get away from you or if you're not utilizing it to your advantage, other people will be. And I think that, you know, it's easy to say like, oh, the system's got this covered or, you know, we'll catch up to that or we'll fix that later. It is a responsibility for anybody who wants to be successful to understand the data that they have present. It used to be a compliance and kind of a checkbox. That's why
SPEAKER_02:it was on tape. You didn't go retrieve it unless you had to. That's right.
SPEAKER_00:That's right. But now if you're not turning that data into really applicable things to go do, I mean there's so much– application that comes out of the day you can you can trend about what your customers are doing you can trend about you know what your customers aren't doing which could be tells them like are they're getting ready to leave or they're you know but putting these things into um kind of an offensive mentality versus just a collective mentality um is something that i think the world has really shifted to and you're starting to see this with I mean, there are AI applications. You can throw a whole bunch of data and it can tell you stuff that you could never imagine being able to be told from this. If you don't have a solid control of that data, your business is going to get away from you and your competitors are going to come at you because they're going to know how to weaponize theirs. and materially take advantage of you, right? And I think that's super important going forward.
SPEAKER_02:Yeah, we're working with a regional news channel, and they've got 30 years of tape, VHS, beta, hi-eight, and they're like, hey, we need to digitize this. We need to run it through some AI, put metadata on it. I'm like, you guys know what this is going to cost? They're like, yeah, but the revenue that's in that historical video for us, and we're like... You sure? And they're like, yep, we need to do this. So now we've got to go send people to sit in a basement someplace and digitize tapes.
SPEAKER_00:It's like your parents giving you the photographs going, can you make these turn from photographs to the web? Yeah, I do think that's a new wave that is becoming just more and more apparent. Even in... Industries or companies that have no business really understanding that, it's now like front and center, like how do we deal with this stuff, right? And that's a great example, the news industry, right? Just like how much things have been lost because of the lack of organization or lack of kind of digitizing that over the years and pretty interesting times for groups like that.
SPEAKER_02:Yeah, I mean, you look at a company that's made sort of that dynamic shift from what we were just talking about, Iron Mountain, right? They were the tape people. I mean, they built a cave in Pennsylvania to store tape safely and then have sort of made that pivot to becoming a good-sized player inside of the data center space. And
SPEAKER_00:they've had to, right? I mean, their business model was challenged early, right? I mean, even when they were picking up paper. Shredding, right? But, but kudos on them, which is realizing that, you know, it's kind of the, the opposite of like a Polaroid or somebody like that. Right. Which didn't really kind of make that Kodak or whatever. Yeah. They, I think they recognize it pretty early, not pretty early, but early enough to kind of make that, that pivot. And yeah, it, you know, I think it's happening all over the place right now. So
SPEAKER_02:for any founders or young leaders listening who want to eventually sit in your chair, what advice would you give them?
SPEAKER_00:You know, surround yourself with smart people. Don't think you can do it all. When you get to the top, bring people with you. I think it's important that, you know, a mentor of mine who's no longer with us, you know, told me a long time ago, you know, the loneliest place in the world is get to the top because when you look to your left and you look to your right, there's nobody there with you. And a bunch of these companies that we do some advisory work for, you know, just try to be good, kind of give backers, right? You always tell them like, you know, being a founder doesn't mean that you're the smartest guy in the room and everybody just does what you say. And if it does, you're flawed. You've got to have people that you respect. You've got to have people that you feel bring you up as well. And if you don't and you are the smartest person in the room, that will carry you to a point, but it will limit you as well. And so, you know, the concept of just making sure that you don't have yes men around you. You got people that always challenge you. They hold you accountable, but vice versa. You hold them accountable, too, in a way that you go like we did this together versus I did this alone. There'd be very few people, I think, that have made it and would tell you that it was because of me. Right. And in terms of them, like independently, most people are going to say, like, I did really have a support system and a nucleus around me that wasn't just saying, yes, sir, or because you're so smart, I'll do whatever you want. There's a relevancy of like, that can last for a minute. But then when you start getting into the actual, I need people to contribute here, they should be contrarian and or, like I said, holding you accountable for the decisions or else it's an easy path just to get off of it, right? And I think that's a flaw that we see a lot of founders who have really great ideas can't scale. because they just can't let go, right? And you got to be willing to let go a little bit to really smart people because there's no doubt that you don't do everything well, no matter who you are.
SPEAKER_02:Got it. So just to sort of wrap it up, let's talk about Center Square. You know, you're the chief strategy officer. What kind of stuff are you working on that you're able to share?
SPEAKER_00:I mean, you know, I kind of don't talk about it a ton on Outside World, but Spencer, who runs the company, I've known him for a long time. He actually used to own the InfoMart.
SPEAKER_02:He was my landlord also.
SPEAKER_00:Yeah, exactly. And kind of Dallas staple, the InfoMart, right? You know, he asked me to come in and help look across the business, make sure it's optimized, make sure that we've got the right partnerships in place, make sure we're looking at the right way to kind of package for customers, expand, do all these other things. And You know, it's kind of a wide breadth. I do lead the entire technical team as well. So from the IT stack through the kind of application side of the business. So a lot of the digital and data work that is really important to me that falls under my umbrella. So doing a bunch of that really, you know, this is the combination of two companies coming together. So kind of, I got there right around, right before kind of full scale integration. And then now we're kind of post-integration and, you know, kind of putting all the pieces together as we're kind of aligned. And so there's just a bunch of work to do. It's like real brute force work going on, right?
SPEAKER_02:How much are you guys leveraging AI for that internal stuff, right? There's personal productivity from AI. How much are you guys using that internally to help with some of those integrations and, you know, some of the big data that we were talking about?
SPEAKER_00:Yeah, I think from the individual applications, there's some AI that happens kind of naturally in those things. Across the board, we're, you know, I would say not a ton. And not for any specific reason, except for a maturity of like, if we were to say, if I was to tell you a ton, we would be at the leading edge of this thing and not knowing the implications of some of that. And I think we have to be really thoughtful to a couple of things, which is, You know, any company, you know, size and scale that we would be at. You don't want to be leading the charge without really knowing what happens next, right? And so we're really thoughtful about the tools we use. We're thoughtful about the emergence of AI in the applications themselves. And we're dipping our toes in the waters of how to manage through that. You know, but we're still in the process of, you know, policy work around like, you know, what can you use on a public, you know, public AI platform versus what can you use on a private, you know, private internal platform? And it's a little bit of uncharted waters. And I think we're all trying to be good stewards of our customer base, the data that we have, and not really kind of run towards it just yet. I mean, like I said, we're walking briskly, but definitely not saying, hey, look at us, we're the most AI-driven company in the world, because that wouldn't be prudent for us
SPEAKER_02:at this point. Are you getting enough AI from your vendors and your applications to sort of leverage some of that as a first step?
SPEAKER_00:I think it's starting to show up, right? You know, we, you know, we use, you know, kind of big box tools on some of this stuff. And you're starting to see every day you get a new, a new, you know, header on your when you log in. Glowing thing. This new AI part is now up and running in this new AI part. I think there's a balance there. I do. I do appreciate that. from a data integrity perspective inside the applications themselves. You can get a lot of work that's contributed to by AI to make sure that things are happening in the correct kind of workflow or dynamic of that. And that's critical and just making sure that that's optimized. I think for the big box applications guys, they are hustling AI out and I think we'll see how you know how what's good and what's bad in terms of it wouldn't necessarily be bad but what's useful and what's not useful on that front but i do think the buzziness of ai is really more a marketing centric piece on some of the announcements that come out of these guys and then the real factor is you know what's actually you know producing good useful data right so yeah
SPEAKER_02:it's amazing i know you could ai enable fiber yes and it's it it's everywhere it's a tagline um But yeah, a lot of that work is really digging into what the offer is and how are they actually using AI? Or is it just
SPEAKER_01:AI? Thanks for tuning in to the IT Masters podcast, where technology's top leaders share their winning strategies. Subscribe now and stay ahead in the ever-evolving world of IT. Until next time, keep innovating
SPEAKER_00:and
SPEAKER_02:leading the way. Check if the lights are blinking. That's right. Well, good stuff, Sean. I appreciate you being here. Thank you very much. We really enjoyed our time here. So thank you.
SPEAKER_00:Great. And I assume this means we get to go play Augusta?
SPEAKER_02:Yes.
SPEAKER_00:Okay. Just making sure. Yeah, we'll find somebody. I do this and I get to go play Augusta. We'll definitely find
SPEAKER_02:somebody. You might have a better network than me for that, but I'll be sure to go with you. Good stuff, man. Thank you. Thanks for having me.