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When to trust a startup: Does size count?
Or balance sheet...
Sysadmin blog How big does a company have to be before we can trust them? Does company size or balance sheet even equate in any meaningful fashion to trustworthiness? What does trustworthiness mean in today's data center?
I recently attended the SimpliVity Connect analyst shindig in Boston. Some grumpy analyst on the other end of the room asked SimpliVity's CEO a series of questions that amounted to "Why should anyone buy from you; what guarantee does anyone have that you'll still be around in a few years?"
While seemingly rational on their face, these questions caused a great deal of introspection for me. I buy from startups all the time. Why? Am I being foolish in doing so? By what measure?
Traditional wisdom certainly has it that we shouldn't buy from startups. Of course, that wisdom has its roots in IT from a different era and it doesn't really apply to today's world. Sure, SimpliVity – or any startup – could evaporate tomorrow. That's always a risk. But what, exactly, is the risk that I'm taking?
Not all IT is equal
One thing that needs to be discussed is that not all IT is equal. SimpliVity is an example of a largely interchangeable piece of the IT puzzle. They make infrastructure. Infrastructure is interchangeable.
If I bought a data center's worth of SimpliVity today and they stopped shipping product tomorrow, nothing dire happens to me. My existing SimpliVity servers still function. The chances are that their method of going out of business was being bought by someone, and that someone is likely obligated to honour the remaining support contracts.
Even if support evaporates with the current incarnation of the vendor ... oh well? I can buy some more nodes from another vendor and migrate my VMs with the push of a button.
Oh, the new vendor won't have a storage solution that's as good. They won't be able to do replication between sites anywhere near as efficiently as SimpliVity. But these are problems that are solved by buying more nodes from whichever replacement I choose and buying bigger pipes to replicate my data. My business would not be under fundamental threat from the theoretical loss of this vendor.
The same can be said of most infrastructure components. If my SAN vendor went phut, there's more where they came from. My switch vendor evaporated? Well, darn. I guess I'll have to replace them with some other completely interchangeable vendor.
Who do you trust
This got me to thinking about trust. Large balance sheets don't elicit trust from me. Yes, smaller vendors are more likely to get bought. Yes, it sucks when your vendor gets bought and it will likely cost you a bit of money in the long run. Well I hate to break it to the anti-startup crowd, but Dell just bought EMC and they're going to end a whole whack of product lines, so I think we all need to face the reality that nothing is sacred in this industry.
What's more, large companies are arrogant. Shine a spotlight on Microsoft for a moment and look at all the stuff that skitters back under the fridge. Here's a company not only willing to distribute malware through their update mechanism, but they're willing to do so under the guise of a security update!
Don't even get me started on licensing shenanigans by the various large-balance-sheet vendors. We've all got lives to lead and I'm not sure that rant would ever actually end.
Be cautious about startups, but not paranoid. Big vendors screw us all the time, in manners both gross and subtle. They aren't immune to termination of product lines, acquisition or simply shutting down, nor is the loss of support guaranteed (or even all that harmful) when a company does actually go under.
If a startup can do what you need done and do it better than an incumbent vendor, take the time to investigate them. IT is all about risk management, but every choice we make carries at least some risk. Even the choice to keep things exactly as they are. ®