October 23, 2003

Charlotte Beachhead Reflects Hosted Solutions's Commitment To Growth, CEO Says

By Rick Smith, LocalTechWire

RESEARCH TRIANGLE PARK - Hosted Solutions highlights its expansion into the Charlotte market with an open house this evening. The growth not only reflects the firm's desire to expand its network but also to offer more services.

So says Chief Executive Officer Rich Lee, who was among the people investing an additional $500,000 in the Cary-based firm to help fund its growth strategy. Hosted Solutions already is profitable, Lee says. And “about a week” was all the time needed to raise the money for the expansion.

“All the insiders are very comfortable with the successes in the past and with the management team,” Lee tells Local Tech Wire. “We feel very comfortable in looking at growth opportunities that are out there.

“We have done quite a bit of looking, and our management team and investors wanted us to focus on the Southeast,” Lee adds, referring to the Charlotte move. “By moving into Charlotte, we acquired a beautiful data center that was not available in other markets.

“We have a pretty clean path to profitability in about seven months,” he adds, referring to revenue the new center is expected to produce. Hosted Solutions already has announced new clients in Charlotte, and Lee says others will be disclosed soon. The company also hired five additional people and will be adding more in the coming weeks.

The open house also is part of a networking event from the Metrolina Entrepreneurial Council. More than 200 people registered in advance to attend.

Hosted Solutions took over a 12,000-foot facility left vacant by another firm after investing $12 million. Because so much infrastructure already was in place, Lee says, “We can run it very conservatively. We do not have to hit a home run to be successful. We can hit a lot of doubles and singles and be successful.”

Not that Hosted Solutions won't be hunting for big game clients. The size gives the company options it doesn't have in carry, such as being able to customize a large area for a client, Lee says. “We think we'll be able to land very large clients,” Lee says.

While Cary will remain Hosted Solutions's headquarters, Lee says the second facility can handle more load, such as mainframes and other “high-end gear,” up to 200 pounds per square inch. Hosted Solutions added various improvements, such as “additional control systems” plus a dual network backbone.

Hosted Solutions has put in place two high-speed links between its two facilities, but Lee points out that if there should be a problem at either one “each can operate independently.”

After the ice storm of last winter and the hurricane this summer, Lee says more companies are concerned about managed hosting, data backup, network services.

“A lot of people felt they had reliability and redundancy and quickly found out they didn't,” Lee says. “There were lots of cracks in their strategies.”

Hosted Solutions has generators for power backup and goes one step further, having contracted with Progress Energy as a “premier power customer.” Lee says that in the event of a power loss, Hosted Solutions is in line to get fuel “second in line behind hospitals and emergency providers” from seven different fuel suppliers. “We have enough fuel to go five days without refueling,” he points out.

Recent weather in the Carolinas has pointed out quite clearly, however, that the region is not immune from long-term outages - in any season.