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Russ: This is The Businessmakers Show, heard here and online at thebusinessmakers.com. And it's featured guest time, and our topic this morning is webhosting-major webhosting. Because I'm at corporate headquarters of The Planet. The world's largest, privately held webhosting company, and my guest is Doug Erwin, Chairman and CEO of The Plant. Doug, thanks for having me and welcome to The BusinessMakers Show.
Doug: Russ, it's great to have you here.
Russ: Well, let's start by you telling us about The Planet.
Doug: The Planet is a combination of two companies that were bought and put together two and one-half years ago. Here in Houston, the company was called EV1-Everyone's Internet, and The Planet was a Dallas-based company. And we bought them and put them together to form the largest, privately held hosting company in North America. What we do is provide cap ex-free IT infrastructure for the small- and medium-sized businesses. We've spent two and one-half years in building out a product portfolio and service portfolio in order to solve the IT infrastructure issues that the small- and medium-sized companies have today. In doing so, we've built a powerhouse of a company, and we've added a lot of new talent. And today, we're at about 550 people between the two cities and growing very nicely, despite the economy.
Russ: I did some research. Actually, I got to tour a data center. Quite impressive. How many servers are under management today by The Planet?
Doug: We have 58,000 servers that we are managing.
Russ: Wow! And do you have any idea how many websites are hosted on those 58,000 servers?
Doug: The public data that is collected states that we've got well over 15 million websites.
Russ: Sheesh!
Doug: What's also an interesting little statistic is that, based on the 58,000 servers and the 15 million websites and the 168,000 square feet of data centers, we have about 3%-2.5% to 3.5%-of the worldwide Internet goes through our data centers.
Russ: Okay. So, on one hand, that's a huge number. On the other hand, there's a lot of market out there that you could still go capture.
Doug: There is a lot of market. This is a very, very big and fast-growing market.
Russ: From my perspective, the business is dynamic. It's really happening. There's lots of moving parts, but it seems to be one that's also packed full of things that could go wrong, things that, as CEO, might, sort of, keep you up at night. Do you ever have trouble sleeping?
Doug: Yes. I don't sleep a lot, but that's by my own doing. There are so many things that can go wrong, Russ, when you're hosting people's livelihood on our servers, but I've got to tell you, we spend an incredible amount of money in trying to make sure that that doesn't happen. Our data centers-You were in one of them. You saw it. I must admit. When I first joined the company two and one-half years ago, and I thought about hosting and I thought about data centers, my background is one of IBM, BMC, and Northern Telecom, and I've had the opportunity to go into all kinds of data centers worldwide. And I've seen some of the best, and I thought, "Hosting. Oh, my gosh. I'm going walk in there, and they're going to have air-conditioning units hanging out the windows, and they're going to have wires all over the floor." And as you saw yourself, it is absolutely amazing the quality of a data center that we build. We build an N+1 data center that is SAS 70 compliant, and it is just absolutely spotless. And when you're managing that many servers, that's number one. You've got to have a facility that is redundant, a facility that is wired properly, so it's easy to maintain. So, we spent a lot of money in data centers. The other place we spend a lot of money is in the network that we have produced. We have a network that has got redundancy. Each one of our data centers has a front door and a back door. If something were to happen in Houston, we have private pipes that go up to Dallas that we could send all of our traffic up and go out Dallas' front door. Or vice versa. If something happens in Dallas, we could do it in and come out the front door in Houston. But this is the kind of stuff that you don't get from some of the smaller shops that can't afford to spend the money, and we're fortunate enough that we're large enough that the economies of scale, we can do that. Now, put on top of the data centers and the network, put on top of the people that we've hired. We're so fortunate to have 550 kamikazi pilots who believe and drink the Kool-Aid on where The Planet is going and what we can do. We're so focused on customer satisfaction that it has become a passion. In fact, it's one of our core values in our company.
Russ: I want to ask about the people, because I know it's real key here. But how many data centers do you operate like the one that I visited a couple of days ago?
Doug: Today, we have six data centers. We announced, about two months ago, that we were building a seventh data center in Dallas, Texas, and we've just announced that we're also opening a data center in London, England. So, for the first time, we will have an international presence in the European market. And the reason why that's so important to us is, believe it or not, even with our six data centers that we have today in Texas, 42% of our customers are international. Yet, we have no international presence. And, so, we've talked to a lot of our big customers in Europe, and we have tremendous amount of pent-up demand from our customers to open up a facility in Europe, and we have done it.
Russ: Wow!
Doug: And, the neat thing is that we've got plenty of expansion capacity over there. And, so, as the business expands, we'll have the ability to handle the amount of traffic. So, that will give us your answer to your question is now eight data centers.
Russ: Cool! We're talking with Doug Erwin, Chairman and CEO of The Planet, and you're listening to The BusinessMakers Show, heard here and online at thebusinessmakers.com.
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Russ: This is a The BusinessMakers Show, heard here and online at thebusinessmakers.com. And continuing on with Doug Erwin, Chairman and CEO of The Planet. Once again, the world's largest, privately held webhosting company. Well, Doug, I've got to think that, in order to capture customers and keep customers happy, you must have a pretty good record of uptime. Do you actually guarantee uptime from the very beginning?
Doug: Yes. We do. And, depending on who the customer is and what service they pay for, we will guarantee uptime from a standpoint of both power and network availability. You have to be pretty confident in your facilities and pretty confident in your people to be able to do that.
Russ: I'd say so.
Doug: And one of the things that I can't say enough about are the people that we have in this company.
Russ: Well, you referred to them a while ago as 550 kamikazi pilots.
Doug: Yeah.
Russ: It sounds like they'll do what it takes for the company.
Doug: Well, I say that in loving terms, but absolutely. You know, it was interesting. The challenge that I was given two and one-half years ago when GI Partners, who are the owners, hired me to put together these two companies and create one massive beast-It was interesting. You have two companies, one in Dallas, one in Houston, that were, what I'll call, warring tribes. They hated each other because they competed in the market. In fact, when we bought the two companies, neither one of them knew that we were buying the other. We rolled them into, literally, a company that was called The No-Name Holding Company, and we did not tell each other until after the transactions were closed, which was thirty days apart, and they were surprised. So, GI starts looking for somebody to run these two companies, and they called me and informed me that, if I'm interested, they wanted to make the headquarters in Dallas. Of course, living here in Houston, I told them that I was not going to move to Dallas.
Russ: Okay.
Doug: And so, we had to go to Dallas and tell everybody in Dallas that, when I got hired, "Oh, by the way, headquarters was now going to be in Houston."
Russ: That probably didn't go over very well.
Doug: Oh, you know, I've been in this town for 14 years. I cannot understand this hate/love relationship between Dallas and Houston.
Russ: Okay.
Doug: It just boggles my mind. When I had to tell the Dallas people that, they were so upset because they wanted headquarters to be in Dallas.
Russ: Sure.
Doug: Vice versa. When we decided to pick a name of the company and we thought about Everyone's Internet and The Planet and we thought about new names and both Everyone's Internet and The Planet had good following. We just felt that we could work more with The Planet, so we picked The Planet. Quite frankly, it's because I wanted to be called the chairman of the Planet. How's that for a title? But, we picked that, and so, when we told Houston that, "Oh, by the way, the name of the company's going to be The Planet." Oh, God, Houston was all upset. You know, how come you picked that name. It's been an interesting struggle to pull together two very proud organizations who had two very successful histories and form one entity.
Russ: Do you think that you're through the adverse feelings of the two groups?
Doug: Absolutely.
Russ: Cool!
Doug: It's long gone. We had some tough times I'll tell you, Russ, when we got started, but we did some creative little things that pulled people together and made them come out of their cocoon and understand that, together, we're a lot stronger than we are separated. And I'm thrilled with the team and the way that they're operating.
Russ: Well, that's cool. Now, speaking of the headquarters being here and the office we're in today. And this is quite a facility. For those not familiar with Houston, it's right downtown in what was the Convention Center built quite a few years ago, and it's not your standard office complex in downtown Houston by any stretch of the imagination.
Doug: It is a little different, but then again, I'm a little different, and this is kind of one of my signatures. Russ, when you take a look at people and how do you motivate people and how do keep people happy at work, and we can go into the philosophy of that, but there are three reasons why, when anyone ever leaves a company, everybody says, "Ah, they're leaving because they're going to make more money at another place."
Russ: Right.
Doug: Could be true. Probably is true, but that's not the reason they first started looking. There are three reasons why people leave a company. The first one is that they're tired of putting the round peg in a round hole and a square peg in a square hole. They get burnout, and they don't feel like they're getting groomed for anything else. The second reason is the environment, both physical and political, and the third reason, of course, is compensation. There isn't a day that goes by that I don't spend at least a half hour to an hour on every one of those topics. Are we doing the right thing? Are we growing people? You know, one of the things that I told both Dallas and Houston when we bought the companies, that this was really a job. People came to work for a job. I don't want that. I want people coming to work for a career. Which means that I, as the company, have to, then, turn around and offer them career paths which didn't exist, which do exist today. We bring people in. We grow them. We train them. Sure, that makes them more valuable. They could leave and go somewhere else, but if they're happy at work and you're paying them a fair wage, they're not going to turn their head. They're going to stay here, and this is reason why I call them kamikazi pilots, because they have drunk the Kool-Aid, they know what we're trying to do, and they are as passionate about what we're trying to build here as I am. The facility was just another tool. When we were hiring people in previous jobs, or even at the early days at The Planet, I would have to spent fifteen, twenty minutes talking to somebody about this is a real company and that we have a culture here and-Now, my goal is that, when I drive to work in the morning and I pull in, that there are people lined up outside our door waiting for us to open us to interview and when they walk in, and they walk into this hall that we've created into a very high-tech organization, that I don't have to spend one second talking about culture or work ethic. Because they feel the buzz, and we've captured this. This building was built in 1966. It stood empty for twenty years. One of the things that I've always, personally, wanted to do is build a company in an airplane hanger, and this is as close as I was going to get. And we've brought in over a hundred tons of steel and I can't remember how many yards of concrete. We've put a second floor mezzanine in with hanging conference rooms connected by walkways. It's all wireless. We've built balconies off the building for people to sit out in rocking chairs. We've created a very high-tech, open atmosphere that people love coming to work. You know when you have them when, all of a sudden, somebody shows up and they've brought their mom and dad.
Russ: That's a good indicator.
Doug: Or they've brought their little child.
Russ: Right.
Doug: And I always make it a point to stop and say Hello to them when they do that.
Russ: Right.
Doug: We like to have events here. We like to, and encourage them to, bring their family here, and when you have the family behind you, you have a committed employee.
Russ: Right. Well, I want to talk more about this facility after this. We're talking with Doug Erwin, Chairman and CEO of The Planet, and you're listening to The BusinessMakers Show, heard here and online and thebusinessmakers.com.
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Russ: This is The BusinessMakers Shows, heard here and online at thebusinessmakers.com, and continuing on with Doug Erwin, Chairman and CEO of The Planet. Doug, the facility is just first class and impressive. But I was particularly interested when you showed me the network operation center. Tell our listeners about how important it was when we had a little hurricane coming through here.
Doug: Sure. The network operations center-we call it the NOC-is really the brain center for our monitoring our worldwide network, and we operate it 24/7 with staff, and their primary goal is to watch what's going on all over the world, to monitor the Internet traffic, to monitor our connections with our carriers, to make sure that we are not hindering the superior connectivity that we promise our customers, back to those SLAs, or the Service Level Agreements, that we promised customers.
Russ: Okay.
Doug: We have a disaster plan, both in Houston and in Dallas. One of the beauties of having two operations in two different cities is that you can have redundant backup, and being as we are committed to customers to have no downtime, just because there's going to be a little storm in Houston, we need to make sure that we continue to support our customers.
Russ: Okay.
Doug: So, when the hurricane came within a certain point, all the bells and whistles go off in our company, and we go down into a lockdown mode, which basically, we bring in extra fuel trucks to our data centers. We end up evacuating the building and, basically, boarding up a group of people in the building in our Network Operations Control Center so that they can monitor still our network without any issues. We are on our own generator, in case the city power goes down, which, by the way, during Hurricane Ike, we did not lose power.
Russ: Wow!
Doug: And the only problem we had was water, but we were able to get through that. We bring in cots. We bring in food. If something were to happen that the Network Operations Center would go offline, we have a redundant facility in Dallas that would pick up immediately.
Russ: Okay.
Doug: So, we had people in there, and they weathered the storm, slept on the floors, ate canned food. The funny thing is, Russ, the customer satisfaction levels for the week of Hurricane Ike were at all-time high.
Russ: Oh, wow! Cool!
Doug: And, of course, everybody-You know, I said, "Well, geez. We should publish that and send it out. Let everybody know that, even during a hurricane, you know, our customers-
Russ: Right.
Doug: -were happy." And everybody with cooler minds said, "What are you? An idiot. You don't want to tell people that Houston is prone to hurricanes. It worked just the way it was designed, and you should be happy with that, and let it go."
Russ: Whoa. Were you in touch with the NOC during Hurricane Ike?
Doug: Yes. Several times.
Russ: Okay.
Doug: Stan Barber, who runs the NOC-He was personally there around-I guess he was there for almost four or five days, but yes, I was in contact with him through the night.
Russ: That's pretty amazing that the power did not go out, but you could have handled it fine if it had.
Doug: Yes. We have our own generator that would have carried it. This is one spot in downtown that did not lose power.
Russ: Cool.
Doug: We were very fortunate.
Russ: Cool. Well, that wraps up the radio broadcast portion of our discussion with Dough Erwin, Chairman and CEO of The Planet, but obviously, there is more. We're going to continue on in the form a BusinessMakers WebXtra. So, just go to thebusinessmakers.com and look for the Doug Erwin WebXtra. You're listening to The BusinessMakers Show, heard here and online at thebusinessmakers.com.