Cloud Options, a company currently in TechStars Cloud’s second class, allows you to pre-book future cloud usage, securing lower prices on payment terms that suit you. They remove common enterprise irritations like a requirement to pay in advance or by credit card. Cloud customers can now accurately budget for their planned usage. Cloud Options is a product offering by Strategic Blue. I talked with James Mitchell, CEO and founder.
Q: Your service isn’t new and you already have paying customers. What was it about TechStars Cloud that compelled you to apply to the program?
A: We were looking for an incubator to guide us in sorting out our branding, to help us understand how to build processes and lastly, to have an organized way to seal our funding round. We had high expectations beginning the program and we continue to be blown away by everything we have learned during our time here.
Q: In GigaOM, you’re quoted as saying you foresee a world where you can secure a fixed price for your future cloud usage and not have to choose a provider that same day. How do you articulate your service to an audience unfamiliar with the lay of the land?
A: There’s a fundamental flaw in the economics of cloud computing and Cloud Options is fixing it. As an analogy, when you’re booking a flight, you don’t buy book a seat on every flight for the next year on a particular route just for yourself, you prebook just what you will need. You also know that buying the ticket at the airport is a bad idea, as the price is higher if you don’t pre-book. The current cloud computing pay structures are a recipe for paying over-the-odds.
Q: What is the experience like for a user without the customization of Cloud Options?
A: Right now, cloud buyers either risk overbuying or they just buy on demand and miss out on the discount for pre-booking. Most cloud computing companies are selling most of their capacity at the “at the airport” price. This doesn’t suit anyone, not even the cloud providers as they can’t plan their capacity very well. We want cloud buyers to be able to book their cloud usage a brick at a time; we then pre-purchase entire walls of usage from the providers. A year is a long time for any business to predict their cloud needs. By offering a fixed price, in advance, for a few months of future usage, in the right currency, we allow the CTO to give a reliable budget to the CFO.