NETTING IT OUT
In my book, Outside Innovation, I profiled CohesiveFT
to explain the subtleties in open source software business models. The evolution
of this
technology start-up continues to fascinate me. Now, two years later, here’s
a brief update. This case study in progress provides important take-aways for
two different audiences:
For Business Execs: How do you design and evolve a business
strategy that is powered by customer-led innovation? The evolution of
start-up CohesiveFT provides six key principles that can be applied to many
customer-led business ventures. Jump to “How to Design a Business to
Leverage Crowd-Sourcing” on page 18 for this discussion.
For IT Architects: How do you design and maintain a computing architecture
that is as dynamic as your business? How can you take advantage of virtualization
to increase agility while lowering costs? Cohesive Flexible Technologies
(CohesiveFT) enables IT architects to build and manage custom application
stacks that are deployed in virtual computing environments. CohesiveFT’s
Elastic Server On-Demand enables technologists in small and large enterprises
to quickly configure custom-manufactured system architectures to meet industry-specific
and company-specific “long tail” requirements.
COHESIVE FLEXIBLE TECHNOLOGIES
Mission
CohesiveFT is a technology start-up based in Chicago with offices in Palo Alto
and London. Its goal is to empower IT architects and developers to assemble,
deploy, and manage customized software environments on virtual computing
servers. CohesiveFT makes it easy for developers to “roll their own” application
stacks or middleware by mixing and matching the specific infrastructure services
that their firms’ particular applications require.
FOUNDERS’ BACKGROUNDS. CohesiveFT was founded in 2006 by three long-time
partners: Craig Heimark, Patrick Kerpan, and Dwight Koop, and a new member
to the group, UK-based Alexis Richardson. The three men began working together
over 20 years ago at O’Connor, a high-tech derivatives firm that was
acquired by Swiss Bank (now UBS). Craig became the first global CIO of Swiss
Bank Warburg. Pat became a Managing Director at CIBC and Executive Director
at Swiss Bank. Dwight was global head of data center operations and technical
security for Swiss Bank’s capital markets division. Pat and Dwight sold
their start-up, Bedouin, to Borland, where Pat served as General Manager of
one of Borland’s most profitable divisions and later as CTO. Dwight Koop
worked as Pat’s VP. Together they convinced Borland to acquire Starbase.
Meanwhile, Craig Heimark became a consultant. His clients included Reuters
and the Chicago Board Options Exchange (CBOE). Craig currently serves as a
board member for Deutsche-Bourse in addition to his role as CEO and Chairman
of CohesiveFT.
CohesiveFT’s Elastic Server on Demand Custom Manufacturing
Platform
Produces a Custom-Built Virtual Server in Minutes
© 2008 Cohesive Flexible Technologies
Illustration 1. You can watch the progress of CohesiveFT’s Virtual Server
Manufacturing operation online as customers’ built-to-order application
stacks are being built. It’s a little bit like watching customer-configured
Dell computers roll off the assembly line. In this shot, we’re three
minutes into the build of my Ruby on Rails virtual server.
As both Pat and Dwight were wrapping up their respective ventures, Craig and
Alexis had met and begun brainstorming what kind of businesses would come
from the world of open source software and the use of loosely coupled architectures.
Alexis also has a background in derivatives trading and software startups.
Soon the four-man team became convinced a new type of product and company
could be formed.
When they first founded CohesiveFT, the team decided to leverage their background
in financial technologies to provide software configuration and management
for advanced technologists in financial firms—hence the original name
of the firm—CohesiveFT (for financial technologies). Over the course
of the firms’ two-year history, the founders have discovered that the
solutions they’ve developed are of value to technologists in many different
industries, so they decided that the “FT” stands for Flexible
Technologies rather than Financial Technologies.
CohesiveFT’s Elastic Server on Demand Community
Site
Lets You Create Three Servers without Even Registering!
© 2008 Cohesive Flexible Technologies
Illustration 2. You don’t even need to register in order to configure
and deploy your first Virtual Servers on the newly launched Elastic Server
On Demand 1.0 public community site. Once you do register, you can assemble,
manufacture and deploy an unlimited number of virtual servers for free. If
you want to add your own code, and/or to do your assembly in private, you’ll
need to opt for the Personal Edition at $10/month. If you want to create your
own code and share those components with others, you can provision your own
branded “personal portal.”
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IT’s Love Affair with Virtualization
Enterprise IT organizations have been investing in virtualization to gain cost
savings and flexibility for the past 20 years. But virtualization has gotten
much hotter as new tools have become available. Today’s virtualization
platforms (VMWare's ESX, Citrix's XenServer, Parallels, Microsoft Virtual
Server, IBM’s PowerVM Lx86, Linux Kernel KVM, and more each day) take
expertise to set up; but, once deployed, they save energy costs, increase
flexibility and scalability, and reduce hardware and systems overhead dramatically.
Data centers, in which each server was dedicated to a particular business application
and operating system, are a relic of the past. Application-specific server
farms are rapidly being replaced by linked enterprise servers running a layer
of virtualization software that allows them to act as hosts for a large number
of guest operating systems, application stacks, and business applications.
Multiple operating systems and application stacks can run side by side on
a single hardware platform without conflict. The layer of virtualization
makes it much easier to scale applications dynamically as needed.
By separating hardware, networks, firewalls, and system management from software,
hardware resources can be managed independently of software. Hardware technicians
can add blades or additional servers without taking the systems down. Software
stacks and applications can be provisioned, deployed, cloned, and de-provisioned
on their own virtual machines in a matter of minutes, not days.
Virtual Appliances: An Opportunity for Software Vendors
Virtualization is a boon to software companies as well as enterprise IT. Instead
of delivering umpteen versions of their software, tuned to umpteen different
operating systems and hardware platform combinations, commercial software
providers can deploy on hypervisors (virtualization software) from IBM, Sun,
HP, VMware, Citrix (Xen), Parallels, and other players.
However, commercial software companies still need to specify the application
services that their particular applications require, and these application
services need to be configured.
Cloud Computing: An Opportunity for Enterprise Application Developers and SAAS
Providers
Cloud Computing is the current darling of forward-thinking enterprise IT architects.
Cloud computing is a virtualization cloud in the sky that you can use to
host and run applications on demand. Think of cloud computing as a Software
as a Service (SaaS) platform for the rest of us. You pay for the computing
resources you consume as you deliver applications on demand.
Small software companies that don’t want to go to the expense of hosting
their own SaaS platforms can deploy their software in a Virtualization Cloud
that is hosted by a third party, such as Amazon (Elastic Cloud) or 3Tera.
Perhaps the biggest surprise to traditional IT managers has been the rapid
uptake in the usage of cloud computing by their own internal development
teams and, increasingly, by their own deployment teams. If you are piloting
an application and trying out various iterations and builds in a non-production
environment, cloud computing gives you a “safe space” to deploy
lots of instances of your work in progress and let different users test it.
Once you are ready to deploy in production, it is much faster and easier
to just “flip the switch” into a production application while
keeping your app deployed as a SaaS in a secure part of the cloud. Your organization
only pays for what it consumes in terms of computing power and gigabytes
of storage, and you’re freed of the burden and overhead of hardware
and systems management.
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Running in Front of the Parade
CohesiveFT’s founders noticed a few years ago that forward-thinking IT
architects were taking advantage of open source software and virtualization
to create and deploy highly-customized virtual servers to support their firms’ specialized
applications. Instead of buying and maintaining large, monolithic application
servers like BEA WebLogic or IBM WebSphere, which are designed to support horizontal
applications in a variety of industries, these maverick lead users were configuring
their own application stacks, combining open source modules like TomCat, Mule,
Spring, and/or Hermes with proprietary services like IBM WebSphere MQ and then
adding their own secret sauce to support industry-specific and firm-specific
production applications. (See Illustrations 4 and 5). These custom-configured
systems were being used to run financial trading applications, manufacturing
operations, and other high-risk, high-value production environments. Maintaining
and constantly evolving these optimized application environments was costly
and required a high-degree of architectural expertise.
But CohesiveFT’s founders also noticed that these custom application
stacks were increasingly being configured and deployed as Virtual Machines
using VMWare, Xen, or Parallels. They were even being provisioned and deployed
on Amazon’s Elastic Compute Cloud (EC2). Virtualization enabled these
complex computing environments to be created and deployed as virtual appliances
without the overhead and expense of having to deploy and manage separate hardware
servers.
Assemble Your Own Virtual Server
Starting with
Your Favorite Brand of Software
Components
© 2008 Cohesive Flexible Technologies
Illustration 3. You assemble your own application stack by starting
with the most appropriate set of software components for the task at hand.
You
can
select different configuration and deployment options. Then you can mix
and match these components with others that are available in CohesiveFT’s
component repository, or create your own component and add it to the manufacturing
build.
Since virtual appliances are hardware-indifferent and software operating system
agnostic, they can be deployed in a data center or in “The Cloud.” Think
of these as “long tail" virtual computing environments. You now
have the flexibility to roll your own custom computing environment and deploy
it anywhere with very little cost or overhead. The benefits are lower hardware
costs, lower energy costs, and lower personnel costs with increased agility
and flexibility.
After watching what lead users were doing and where they were having difficulties,
the founding team at CohesiveFT realized that they knew how to design a software
configuration and manufacturing environment that would make it much easier
for developers to custom-configure, deploy, and manage their application
stacks.
The CohesiveFT team also noticed that enterprise infrastructure software sales
had moved from top-down CIO-dictated to bottoms-up developer-tested and proven.
They recognized that the current generation of software developers, recommenders,
and buyers had grown up in an Internet world. These customers valued self-service,
mass customization of best-of-breed components, transparent pricing, the
ability to try before they buy, and the ability to extend and/or to contribute
code.