Editors’ note: DriveScale is a new, smarter data center infrastructure for scale-out, allowing organizations to buy, configure and rebalance compute, storage and networking resources separately. CEO Gene Banman is a serial entrepreneur. In this interview, he shares insights about disruptive software, pivots, building a market, spend decisions, communicating and other tips for leaders of software companies.
Tell me about why you developed DriveScale and how it affects the storage and server landscape and Hadoop.
Gene Banman: We saw that there is an issue with the standard way of deploying commodity servers underneath Hadoop. The scale-out model used over the past 15 years or so gives organizations a lot of storage and processing at the lowest cost, but it’s completely inflexible. The platform is configured when an organization orders the servers, and it stays the same until they are replaced. So companies tended to over-provision the CPUs yet had utilization rates well below 20 percent. Yet with the enormous amount of activity around data analytics products and ecosystems, a lot of organizations were completely unable to respond to the change without buying more servers to expand storage or compute capabilities.
Our company’s founders thought they could do something about that by taking advantage of the high bandwidth that has become available through the 10 gigabit switches that have been adopted the last couple of years. That bandwidth is enough to enable taking the disc drives out of the servers and connect them up through the switch; then through software, organizations can allocate disc drives to servers under software control. So they can reassign and move server resources around to where they are actually needed.
You’ve been a serial entrepreneur, running three companies for 15 years prior to DriveScale. In the other three, did you launch products that were disruptive to their markets?
Gene Banman: I would say yes. Although I think DriveScale is not disruptive; it’s actually a supporting technology for the Hadoop scale-out model, which is a disruptive technology. What we’re doing for Hadoop and scale-out is making it more effective and easier to use, supporting Hadoop’s disruption against the traditional scale-up computing.
My previous three companies were disruptive. It’s always harder to be disruptive than it is to be supportive. We definitely struggled in each of those companies to try to find a market and grow that market until the point where it could go mainstream. In one case, the company is still in that endeavor.
What attributes or skills do you think are essential for a leader whose company is pioneering something?
Gene Banman: It takes an understanding of what’s going on in the market and in the customers and in the technology, being able to mold those three things together into a strategy that makes sense and then being able to communicate that.
There are three major jobs for a startup CEO. One is raising money. The others are building a team and selling the product. In all three cases, it’s all about communicating the message of the company.
So the essential skill is communication.
Gene Banman: Yes. It’s about putting a story together. I like to say that the CEO is the Salesperson in Chief. The CEO sells the company to investors, customers, partners and potential employees. Investors must see that the vision will carry the company forward for years. And you can’t hire the best talent unless they buy in to the vision. Employees want to join a company that will make a difference in the world.
The CEO also sells the company to existing employees because the team needs to know what’s going on – what’s going well and what’s not going well – so they know what they need to do to help the company along.
The number-one job of the CEO is to determine the mission and vision for the company. The CEO doesn’t have to create the vision; it can come from anyone. But the CEO must “bless” it and then actively use it to drive the company.
In your years prior to when you were leading a company, was there someone who influenced your leadership style more than anyone else?
Gene Banman: Scott McNeely at Sun Microsystems. I worked in his organization for 15 years and learned from him a ton about what it means to be a leader. He was a fantastic CEO in many ways.
What is one of the biggest leadership lessons that you learned at your three prior companies?
Gene Banman: At NetContinuum, I learned that when you’re building a company around a disruptive technology, you have to have a very low burn rate technology strategy. We had a very high burn rate technology strategy at NetContinuum. Our product was disruptive, but we needed to build the market. We just couldn’t keep the funding going at the rate it needed to be kept up while the market was developing. There was a competing company in the same space, and they had a software-only strategy with a very low burn rate. I think they had only 15 engineers, and they could continue on with a very low burn rate as the market developed. They just went public last year. NetContinuum had a slow developing market and eventually had to get sold.
My advice to startup CEOs is to match your technology strategy with the business realities. If you’re creating a market, it’s going to take some time. You either need to have very deep pockets, or you need to have a low burn rate technology strategy.
How much of that insight came to you from what you observed as opposed to what VCs advised you?
Gene Banman: It was painfully self-learning. I had just come out of Sun, and I thought I could solve any problem in the world. It was definitely a learning experience.
At this stage of your life, leading a fourth company, is there a lesson you’re aware of now that you didn’t know about in the other three companies, which you think is really important for startup leaders to know?
Gene Banman: One thing that has been fantastic about this company is that we all know each other very well from our prior lives. That was not the case in any of my other startups. It’s really so much easier to work closely together when you’ve worked together in the past. I don’t think it’s a necessary ingredient for a startup, but it’s certainly a big advantage if you have that.
What is a pitfall that you would advise young leaders to try to avoid?
Gene Banman: Young CEOs have often grown up as the smartest person in the room and they’re used to always having the right answer for everything. So it’s very tempting for a new CEO to keep his or her hand in all the decisions and activities; but that’s a mistake. The CEO’s job is communicating the vision and message; they have to let people do their jobs as they see fit.
But the most important thing for young CEOs is to figure out how to get a repeatable sales model before they spend too much money on the product. They can’t lose sight of how important this is. Sun was a very cautious company in terms of spending money. A startup CEO should not make even strategic investments until having proof that the product is really going to work. That was part of the issue at NetContinuum – doing a big, expensive product without having first proven that there really was a market for the product.
Did you ever have to do a pivot?
Gene Banman: Yes, at Zero Motorcycles, which was a disruptive technology and established a new kind of vehicle space. The pivot we made was from off-road motorcycles to on-the-street motorcycles. The key was finding an investor that was strategically committed to building a market and committed to sticking with it for the time it took to actually build that market. Zero Motorcycles just finished its tenth year, and the original investor is still the predominant investor in the company. They’re going to be a big, successful company because this investor is so strategic in creating the marketplace. They were able to be cost-effective and not spend too much money but at the same time the investor had the long-term view to stick with it through all these years and really make it a successful company.
At DriveScale, was there anything about product development that caused you to take longer to get to market than you anticipated?
Gene Banman: Technology always takes longer than you think it will. We were very focused on lean startup principles and getting early versions of the product into our customers’ hands and getting feedback from them. That’s a really good technique. But in terms of how long it would take, we thought we’d be to market 18 months ago. But as you get into solving real problems for real customers, it always takes a lot more work than you think it’s going to take. Fortunately, we had the financial wherewithal, and we were very cautious with our money; so we were able to take the time it took to get things right.
If you had a chance to sit down for an afternoon with someone you consider a software leader and get tips from that person, who would it be?
Gene Banman: Fortunately, I’ve had the chance to do that already with James Gosling, the inventor of Java. He is on our advisory board, and we get his feedback every quarter on what we’re doing. He’s really great.
I think it would be cool to talk with Doug Cutting, the father of Hadoop.
Most of your team members are in their 50s and 60s. Why is that?
Gene Banman: One of my tongue-in-cheek comments to the VCs was that if we were doing social media, we’d probably need to be in our 20s. But since we’re doing computer center infrastructure products, having been around the block a few times is definitely very helpful.
Gene Banman is CEO of DriveScale, founded in 2013 to build smarter infrastructure architectures for scale-out data centers. He has been a serial CEO for 15 years, leading companies such as NetContinuum, Zero Motorcycles and ClearPower Systems. Earlier, Gene was a member of Sun Microsystems’ senior management team, leading the Workstation product group, pioneering the company’s thin client technology, leading Sun’s first ODM deal and sponsoring the acquisition and open sourcing of the Star Office suite.