Visitors to InFlow Inc.’s Sorrento Mesa office can see through the clear glass front doors but can’t open them until the smiling receptionist sitting inside gives her OK and presses a release button.
It’s just another sign that things are under control at InFlow.
The local Internet data center is one of 18 operated by the Denver-based company, which prides itself on customer satisfaction. The company also celebrates its four-year anniversary next month.
Mike Marcoux, InFlow’s general manager in San Diego, notes customers seeking help should expect to hear from a staffer within two rings of the phone and not get a pre-recorded voice message. Plus, the problem will be addressed at that moment, not within 24 hours, he said.
The focus for Web hosters such as InFlow isn’t just providing Internet access for firms with an interactive Web site, but providing the security and maintenance for the computer hardware necessary to conduct this business.
“We’re an outsource provider to companies who outsource some of their IT infrastructure. It might not only be their e-commerce applications, but it can be any Web-based business that they’re doing, their storage, their transfer of data, their database,” Marcoux said.
The business can be a lucrative one, and the market is growing. According to a report from Forrester Research, sales in Web hosting should reach $4.39 billion this year and expand to just below $20 billion by 2004.
More and more companies are finding the costs associated with running Internet sites, particularly the expense in paying a staff to maintain the site and hardware, to be so high they cannot afford to do it on their own, said Attila Tota, InFlow’s district sales manager.
“For a company to duplicate what we have here, this level of redundancy, this level of availability would cost between $8 million to $12 million just to put in place. Then you have to add the ongoing operating costs for the technical staff to maintain this equipment,” he said.
Easing Fears
A few months ago, an online bridge club, OK Bridge in Pacific Beach, was worried its site might not survive the rolling blackouts that were hitting areas all around them and wanted a higher level of security.
“That was the main reason they came to us,” Tota said. “They wanted to ensure their site was going to stay up in the event the lights went out.”
Should a blackout hit InFlow’s neighborhood, the center has six UPS (uninterruptible power system) batteries that can provide all the energy needs until an electrical generator kicks in, which takes seven seconds, Tota said.
InFlow’s local customer list numbers 37 and ranges from large enterprises such as Wireless Knowledge and Akamai, to smaller firms such as Learning Framework and Alitum Inc.
“We went to two other providers before we decided to go with InFlow, and we’re happy we found them,” said Bruce Carothers, Alitum’s chief technical officer. “They’ve been very responsive. Instead of taking hours to fix a problem, it might take five minutes.”
Alitum provides back-office software, such as accounting and finance functions, over the Internet to its mostly small-and medium-sized businesses. While Alitum has access and control over its Web site, its infrastructure and equipment is maintained at InFlow’s offices.
In case there are any glitches or disruptions, Alitum relies on InFlow to keep its site operating while the problem is resolved, he said.
Different Focus
Although the failure of the dot-coms put a huge crimp in the revenues of many of its competitors, InFlow emerged relatively unscathed, Tota said.
“Our focus was more on enterprise-type customers, not those that are 100 percent Web-based applications, or the pure dot-coms,” Tota said. “We were fortunate when building out most of our centers last year that many of the dot-coms were failing about then, so the customers we were signing up were either the ‘old economy’ type customers, or those dot-coms that survived and were stronger than those that failed.”
Launched in 1997, privately held InFlow has attracted more than $330 million in capital including GE Capital, First Union Capital Partners, Spire Capital, DLJ Merchant Banking and Cornerstone Equity Investors.
Its most recent round of $35 million will be used to support its 18 data centers, nearly all of which, including the local one, were rolled out last year.
The company’s strategy was to go into cities where their competition in hosting firms wasn’t as great. Larger cities such as New York, Los Angeles and Chicago have 70 percent of all the Internet hosting services, Tota said.
InFlow’s business plan was to set up in cities where there were fewer competitors, such as Austin, Miami, Nashville, Philadelphia, Portland, Ore., and Sacramento. In addition to 18 national sites, it has two sites outside the country in Dublin and Toronto.
InFlow had $20 million in revenues last year, and should reach between $55 million and $60 million this year, Marcoux said.
All totaled, the company has about 500 employees, including 20 in San Diego.
