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Amito

Explore the challenges faced by your peers and advisors in our five minutes interviews. 
Geoff Archenhold image

The challenges that we had in the early days are significantly different to those that we face now, but I wouldn’t say that they are any easier or harder to overcome.

Geoff Archenhold image
Ed Butler
Chief Executive Officer
Amito

Tell us about yourself

Amito is a digital infrastructure provider, we own and operate Reading’s largest data centre and also maintain a cloud platform that spans 27 different third party data centres.

Everything that you do online uses a chain of data centres to store, process and transmit data. That could be sending an email, doing your shopping online, making video calls or browsing online. These things that we often take for granted use a number of data centres to operate.

Amito was founded in 2012, we started as a small team with start-up mentality and as a result of that I’ve worn a variety of hats over the years.

I am the CEO, we have a team of around 30 at the moment, quite a bit of my time is spent managing the team and helping to nurture and grow them, alongside strategic thinking and looking at the next steps for us as a business. Although I do still get involved and enjoy knowing some of the finer technical details that go into what we do and seeing the sales processes. I have a broad role that I really enjoy.

A number of different businesses make up Amito, one business that we’ve acquired and two businesses that we initially started and kept quite separate. The three businesses we are made up of are: iCloudHosting, a managed hosting provider which operates the cloud platform in several data centres, Everest data centre, which is what the Reading data centre started as, and Crosspoint Colocation which we acquired, giving us a footprint in other data centres predominantly located in London but also slightly further afield.

You’ve worked in the technology industry for almost 20 years, how has the sector evolved during this time?

My experience is centred on the data centre and hosting industry where I started working at age 17. Since then the industry has gone through many big changes, a lot of which have come about because it has grown so much and the side effects of that growth.

When I think about early days of the industry, it really was like the Wild West. It has changed hugely, all of our competitors are professional, serious companies now, whereas that wasn’t true 20 years ago. The industry has done a lot in terms of standardisation of the services delivered regarding quality and security. The scale of things has also got a lot bigger, data centres used to be a small floor on a multi-tenanted office building when the industry started, now these are 20-30 acre sites which are dedicated facilities.

There has been a noticeable professionalisation of the industry, customers have also become much more sophisticated. When I started, the sales team needed to be able to answer questions regarding when a system could be up and running, and how much it would cost. Buyers now have a more rigorous due diligence process and are much more sophisticated, which has weeded out some of the weaker players.

The other big change is the type of capital the data centre industry attracts. It used to be that data centres attracted quite high risk capital, borderline venture capital type investment where they are expecting high returns but also a high chance of failure. As the industry has become more established, the type of capital has changed, data centres are now seen as a property asset class in their own right. Investors these days are typically pension funds and infrastructure funds which have a lower cost of capital and much less risk than the early investors. This definitely creates different challenges for management of data centres with outside investors.

What are the biggest challenges you’ve faced so far in your career?

The two biggest challenges are getting the people right and the investment and capital. On the people side of things, it’s about finding the right kind of people whose values are aligned to our own, this is really at the heart of our strategy. This takes a lot of time to get right, a key part of that is recognising when things aren’t working well and making changes. A team of people is an incredibly complex system with lots of things at play so getting that right is an ongoing process.

The other big challenge has been capital and investment, as mentioned, we have managed to grow the business without giving up any equity to outside investors. We are in a very capital intensive industry, if you don’t have enough capital it can really put the brakes on your growth. Maintaining that ownership has been tough at times. We are now established enough that we have relatively easy access to the capital we need to grow, but in the past that has been very challenging.

The challenges that we had in the early days are significantly different to those that we face now, but I wouldn’t say that they are any easier or harder to overcome.

What’s your best advice to someone starting their career in tech or the data centre industry?

If someone is looking to get into tech it is important that they enjoy tech and that passion drives their motivation.

Tech is a huge and growing sector and we have seen this especially over the last six months with COVID-19 creating a greater focus. There can be expectations that a growing or successful industry will take you along with it. But I believe a sustainable career thrives on continued learning and development, you need to have a genuine interest in tech in order to have a passion for discovering and understanding new technology.

What trends have you seen in the market in the last six months? 

What we saw from late March to early April was a rush of people trying to get their infrastructure right, both new and existing clients were asking us to deploy infrastructure for them so that they could ensure business continuity. After that initial rush, things settled in late spring/early summer.

More recently, as we enter another new phase we have seen another noticeable change in people’s behaviour, where people are looking ahead to the longer term. At the beginning, nobody knew how long lockdown was going to last. Now we are seeing people closing their offices and moving their digital infrastructure out of their offices and into data centres, using colocation and cloud with providers like us. One of the many reasons for doing this is that businesses will be able to scale their service more rapidly, have better security, robust resilience and expert on-site support. This trend started becoming noticeable from our point of view in late July to early August.

Looking ahead where do you see your sector evolving and what advice would you give to fellow entrepreneurs?

One of the very noticeable things about the sector is that the industry is still concentrated around greater London and Reading in the South East, something I am expecting to see is more of a geographic spread of data centres further afield. The data centre industry is going to be a feature of our digital infrastructure for the foreseeable future, it’s difficult to see a world without these, I think the industry will continue to evolve and mature and an impact of that is that data centres will probably get bigger.

In terms of advice to fellow entrepreneurs, a lot of the success that Amito has had and is probably true for other businesses, is a case of being in the right place at the right time.

If I was to give advice, I would give it to my younger self, to learn to be patient. I have found that being prepared to wait and take time over certain decisions and situations can be a huge advantage. When I was a young entrepreneur, I was really good at making quick decisions, but not waiting when the situation called for it. One thing I have improved and learnt the value of is taking the time to pause and reflect.

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Leo Malkin
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