Making a go of your startup: how cloud is the answer

It's new year, the time when many people start thinking of setting up on their own: for them, cloud is the only option

You’ve got your big business idea, you’ve secured your necessary first round of funding and you’ve got your customer base, price, sales channel and even your company logo all clearly defined. With this initial focus on the front end as the first consideration, every start up will also then logically need to look at the back end and work out how make it all happen.

This underpinning operational infrastructure will encompass everything from paper and pens to desks and office premises. But more fundamentally than all of these factors, (especially in the year 2013), will be the subject of the IT system to be used.

The question is… should start-ups act like African telco customers? That is to say, where terrestrial African telecommunications never existed, many users were given the opportunity to jump straight to mobile networks once they came along. So by way of that notion, where startups do not necessarily need to make traditional heavyweight capital expenditure (CapEx) based investments in IT, shouldn’t they take the on-demand cloud route instead?

Isn’t a service-based pay-as-you-go cloud computing based approach to information technology really the ONLY sensible option for startup businesses in this day and age?

Lessons from Silicon Valley
Let’s do the maths here. Why do so many Silicon Valley startups begin life in a garage or spare bedroom? Because startups need to avoid initial long-term expenditure commitments of course, so avoiding commercial property rental is a key first step.

Equally, buying a “guestimated” chunk of computing capacity (however accurately) is nothing if not a long-term expenditure commitment. Compared to cloud services that can be spun up or down in a matter of minutes (OK, let’s say hours), anything that comes in a solid black box and sits in the corner is more of a commitment than a service.

CEO of Onyx Group Neil Stephenson reminds us of the ‘obvious but worth repeating’ truths that cloud services are traditionally quick to provide, set-up and then scale up or down, enabling companies to get to market rapidly. “As well as the advantage of extremely flexible data requirements and storage space, startups may not have the in-house skills to technically support such solutions - making cloud services desirable as they are typically managed and supported externally,” he said.

Isn’t a service-based pay-as-you-go cloud computing based approach to information technology really the ONLY sensible option for startup businesses in this day and age?

So front end and back end both considered then, the middle IT layer also becomes a key focus area for startups. This is the "live" programming layer where software application developers will be working to engineer the mechanics of the new business.

Cloud platforms are here charecterised by the richness of their business collaboration tools that work in real-time to allow developers, operations staff and business workers to integrate with each other. Salesforce.com’s SME (small to medium sized enterprise) help guide suggests that according to IT analyst firm IDC,"[Using cloud] it is possible for SMEs to build applications about five times as quickly and at half the cost of using traditional software platforms. This will potentially enable you to innovate and stay well ahead of your competitors in terms of their development curve.”

Then there is the mobile factor brought about by the proposition of running all (or nearly all) of the business through what is effectively an Internet browser channel. According to Salesforce, “[SMBs and startups] can now run their whole operation through their browser, based entirely on cloud apps. The benefit being it allows SMEs to instantly set up enterprise-class services, providing agility when expanding and eliminating deskbound business software constraints & management.”