Sullivan Alexander is a contributor on the Price of Business on Business Talk 1110 AM KTEK (on Bloomberg’s home in Houston), whom you can learn more about at, www.contureadvisors.com
Sullivan recently interviewed Alex Brown, Founder and CEO of 10th Magnitude.
About the interviewee:
Alex Brown is the Founder and CEO of 10th Magnitude, a Chicago-based custom cloud software development firm. Alex, a self-proclaimed cloud technology evangelist, founded the firm in 2010 to help clients unleash the power of the cloud to drive innovation in their markets.
Alex has devoted more than 25 years to the tech industry. His extensive tech career includes Dell, where he ran their consulting business in the Asia-Pacific region as well as their global infrastructure solutions business in the US and Plural, one of the largest .net developers in the country (Plural was acquired by Dell in ’02), where he was a Managing Director. He has also served as an executive at mid-size companies such as Univa (Datacenter Automation and Cloud Management) and Arrowstream (cloud-based supply chain management technology).
Alex holds a BA in Economics from Oberlin College and an MBA from Yale. He lives in Glencoe, IL.
Tell me about your firm (products/services offered, number of employees, location, type of customers you work with, etc.).
10th Magnitude is a cloud software and services firm based in Chicago, IL. We are a 12-person company that develops custom software applications, provides application management and migrates applications from on-premise hardware to the Microsoft Azure cloud to help businesses of all sizes innovate and compete more effectively.
Our Custom Application Development Practice builds software in the cloud to help small and mid-size businesses realize their technology visions. We use the cloud to affordably craft custom, secure, scalable applications to help customers innovate in their markets with low risk and little or no IT capital cost.
Our Azure Practice migrates applications, manages cloud services and crafts new cloud applications on the Microsoft Azure platform. We work with large corporate IT teams to implement solutions that streamline technology needs, improve functionality and optimize costs. We specialize in the Azure Cloud and we are part of Microsoft’s elite Azure Circle.
Tell us about the key challenges your business faced during the slow economic recovery.
10th Magnitude’s business was actually born out of the slow economy. The company was founded in 2010 to harness the power of the cloud to drive costs down and innovation up for clients. The cloud gives business clients access to technology that lowers current IT costs, avoids hiring additional IT staff, and, most importantly, gives them the power to create new economic growth engines through market innovation. The state of the economy was perfect timing to help push adoption of cloud—it gave our customers an incentive to use the more cost-effective technology.
The biggest challenge we faced during that period was finding the right people to hire. Demand for qualified people is extremely high and the tech job market is tight. Additionally, since 10th Magnitude uses a newer technology, there were few skilled engineers that had knowledge and skills in the area we needed.
How did you overcome the challenges, and position the business for growth?
Since 10th Magnitude’s biggest challenge was finding qualified engineering talent, we established ourselves as the top provider of Microsoft Azure (cloud) solutions in our marketplace to attract technologists who were interested in becoming expert in the technology. We offered them mentorship and education and the opportunity to work on exciting projects.
On the client side, the largest hurdle was getting potential clients over the adoption hurdles related to cloud technology since it was new. To overcome this challenge, we strategically targeted SMBs that embraced the cloud for it’s financial advantages. Once 10th Magnitude had established the security and cost-effectiveness of the technology with smaller, “pioneering” clients, we leveraged that success to engage large corporate organizations that are now beginning to overcome their fears about cloud.
What do you see as “hot button” issues in your industry, and what are the implications?
There are hot button issues both in tech in general and in cloud tech specifically.
Generally, there are not enough software engineers, which drives salaries up. That dynamic drives costs up for clients and limits our ability to grow as fast. We have to reinvest in hiring, which slows down our ability to execute on other initiatives.
In cloud tech the biggest issue is continued skepticism about using the cloud. Some functional concerns are rooted in reality because, as with any new technology, there are elements that are still maturing. Other concerns are reflexive push back related to cloud driving organizational change. The reality is that cloud will create an environment of innovation and positive advancement.
There is a good-news hot button issue as well, though: the growth of cloud is opening up many new areas of business for our clients, creating low-risk, faster-payoff opportunities to create value.
What makes your business different from the competition?
We are all in when it comes to cloud: we fundamentally believe that the cloud is the future and only create cloud solutions. We firmly believe that clients should not buy or manage hardware, which is expensive and slows them down because it forces them to worry about maintenance instead of innovation.
Another differentiating factor is that because we are committed to cloud, we are truly expert on one tech platform rather than all things to all people. We have put a stake in the ground with our skill in Microsoft Azure and our partnership with Microsoft, and have been recognized for our expertise.
Finally, our work process is truly collaborative. We listen to our clients and our goal is to not just understand them but find ways to actually improve their ideas, making them work better than they expected. We don’t look for limitations, we create opportunities.
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