a year old, but still an interesting article about rack..ww.bizjournals.com/sacramento/print-edition/2012/05/04/software-developer-rackwise-folsom.html?page=all
SUBSCRIBER CONTENT: May 4, 2012, 3:00am PDT
Software developer Rackwise moves to Folsom
Publicly traded startup lands new management, infusion of private capital
Mark Anderson
Staff Writer- Sacramento Business Journal
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Rackwise Inc., a fast-growing technology company, moved its headquarters from San Francisco to Folsom last week.
The publicly held company, formed six months ago from a merger with a six-year old technology development company, has landed new management and an infusion of private capital.
Guy Archbold, new chairman of the board, chief executive officer and president of Rackwise, lives in El Dorado Hills and didn’t want to move to San Francisco. A former New York investment banker, Archbold is a director with Denver-based Black Diamond Financial Group LLC, a venture capital firm that is a major shareholder of Rackwise. He previously had been chief executive of BluePoint Energy, an El Dorado Hills company that was liquidated in 2009.
Eleven others, including senior management, have joined Archbold in Rackwise’s Folsom office. The company’s remaining 28 employees are in Boston, New York, Dallas, Chicago and Los Angeles.
The thinly traded Rackwise (OTCBB:RACK) has raised $9 million in private capital since September and hopes to raise another $2 million in a private offering before the end of the second quarter.
The money, raised from both existing and new accredited investors, will be used to grow sales, Archbold said.
The company, which develops and sells management software for data centers, had $2 million in revenue last year. Though relatively tiny, the company provides evidence that Folsom is gaining clout as a technology hub, said Dave Sanders, managing partner of the executive search firm WorldBridge Partners in Roseville.
“I’m glad someone did the math and decided to come this way for a change,” he said.
Rackwise clients include Cisco Systems Inc., Adobe Systems Inc. and General Electric Co.
Moving its headquarters to Folsom already has affected the local market. Anticipating the move, Rackwise in February hired longtime local executive Jeff Winzeler as its CFO. Winzeler was CFO with Solar Power Inc. in Roseville and before that with International Display Works, also in Roseville.
Having a headquarters move to the region has many benefits, including opening positions for executives, said Meg Arnold, CEO of the Sacramento Area Regional Technology Alliance.
“There are a lot of talented executives in this region that commute elsewhere to work,” Arnold said. “We have more executive talent in the region than is generally recognized. We need to change that perception, and we change that by having them work here.”
Rackwise specializes in infrastructure management software for data centers. By making the centers’ servers more efficient, customers can save up to 20 percent in energy costs, Archbold said.
The power and thermal management component Rackwise wraps its technology around was developed by Intel Corp. Rackwise signed a multiyear software integration and license agreement with Intel in December to sell the Intel Data Center Manager.
“Our real-time power management is plugged into their solution,” said Ajay Garg, global business development manager for Intel’s Software Solutions Group in Portland, Ore.
Rackwise is using the visualization technology developed by Visual Network Design Inc., the 2006 San Francisco company it bought out six months ago in a reverse merger.
Rackwise’s technology selects the most efficient servers in a data center and uses them at near capacity, throttling down energy use in the central processing units of other servers. The technology is based on the simple concept that it is more efficient for fewer servers to be used at near capacity than it is to have many servers running at low capacity, Archbold said.
Rackwise’s customers are companies that run their own data centers. The Sacramento region has dozens of very large data centers. And including Rackwise, the region now has three locally based companies that make data centers more efficient.
Rackwise moved into the Folsom building recently vacated by SynapSense Corp., which sells technology to make data center cooling and monitoring more efficient. Cloud Cruiser, a Roseville company, sells cost optimization and management software for cloud computing.
There are many companies interested in cloud computing-related business because that is the direction technology is going, said Dave Zabrowski, chief executive of Cloud Cruiser.
“The use of and demand for cloud services is going through the roof,” he said.
And efficiency technologies tend to come from small startups.
“Innovation is easier in a smaller company,” Zabrowski said. “Large technology companies are busy developing products, manufacturing them and taking them to market,” while small companies can often react more quickly to needs in the marketplace.
Rackwise joins a hub of technology companies in Folsom, including an Intel campus of 6,600 workers, Micron Technology Inc., SynapSense, AgreeYa Solutions, Microsemi Corp., Sierra Nevada Corp., Visionary Integration Professionals, and the California Independent
