lanham presentation final sj review -...

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Welcome

2010 RACKSPACE LEADERSHIP SUMMIT • OCTOBER 5-6, 2010 • SAN ANTONIO, TEXAS

This presentation outlines general information regarding our services and is for informationalpurposes only; all statements and information are provided “as is” and are presented withoutwarranty of any kind, express or implied. Our product/services offerings are subject to change

ith t tiwithout notice.

Trademarks and Service MarksRackspace® and Fanatical Support® are service marks of Rackspace US, Inc. registered in theUnited States and other countries. OpenStack and OpenStack design are trademarks ofOpenStack, LLC. Other trademarks and tradenames appearing in this presentation are theproperty of their respective holders. We do not intend our use or display of other companies’tradenames, trademarks, or service marks to imply a relationship with, or endorsement orsponsorship of us by, these other companies.


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Fanatical Support® Made Us #1 in Hosting

Source: Tier 1 Research Internet Infrastructure Market Overview Spring 2010

2nd Quarter Annualized Growth: 23%

Source: Tier 1 Research, Internet Infrastructure Market Overview, Spring 2010


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The Right Partner: Solid Financial Performance

$750 Milli R R R tAnnual Revenue ($M) $750 Million Revenue Run Rate

49% Revenue CAGR for the Last 6 Years$224 0

$362.0

$531.9

$629.0

($ )

61% Adjusted EBITDA CAGR for Last 6 Years$56.6 $86.8

$138.8

$224.0

2003 2004 2005 2006 2007 2008 2009

Net Income Positive Since 2004

26 A l t C th C d 24 H$145.3

$200.6 Adjusted EBITDA* ($M)

26 Analysts Cover the Company and 24 Have a ‘Buy’ Rating

$11.3 $20.5 $37.2

$64.7

$91.3

2003 2004 2005 2006 2007 2008 2009


2003 2004 2005 2006 2007 2008 2009

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210.312.40002010 RACKSPACE LEADERSHIP SUMMIT • OCTOBER 5-6, 2010 • SAN ANTONIO, TEXAS

Ingredients of Our Secret Sauce

1 Burn down “voicemail jail ” Make support 8 Assign 2 000 of our 3 000 employees to1. Burn down voicemail jail. Make support teams available by phone, email, web chat. . . 24/7.

2. Recruit employees for attitude and

8. Assign 2,000 of our 3,000 employees to customer support.

9. Measure customer churn and Net Promoter Score daily, and track results by support team p y

aptitude.

3. Test employees for strengths, and assign them to teams with complimentary

and customer segment.

10. Incent teams to boost NPS and reduce churn.

11 E f tli l t d tistrengths.

4. Build integrated support teams that include account managers, system administrators, and support technicians

11. Empower frontline employees to spend time and money (including five-figure service credits) to address customer issues.

12 Develop proprietary tools to share knowledgeand support technicians.

5. Recruit specialists in security, storage, networking, and other key disciplines.

12. Develop proprietary tools to share knowledge across support teams.

13. Train and incent managers to boost employee engagement, so that our Rackers—the heart

6. Employ more Red Hat certified Linux techs that any company other than Red Hat itself.

7. Train employees in tech-support skills,

g g ,of our business—will volunteer their best every day.

including through partnerships with local colleges.


Metrics Guide Our Progress

Employee Engagement Our Racker Survey

Customer Satisfaction•Net Promoter Score (NPS)(NPS)•Churn Rate•Customer Credits


Net Promoter Approach to Customers AND Partners

Extremely

%Promoters9-10

Extremelylikely

minus7-8

0-6%Detractors

Net Promoter Score (NPS)Extremelyunlikely

%Detractors


( )

What Makes a Great Partnership?

• Help Each Other Win

• Right Fit & Alignment– Right Products

Sh d Vi i– Shared Vision– Shared Values

• Both Partners Make MONEY


Defining Hosting

In HouseIn House Cloud HostingCloud

HostingDedicatedDedicated

HostingHosting

HOUSE CONDO HOTELHOUSE CONDO HOTEL


The Transition to Cloud

"Th b lk f b i ti ill hift t"The bulk of business computing will shift out of private data centers to the ‘cloud’."

– Nicholas Carr


Nicholas Carr

The Transition to Cloud

2015Cl d 2015Cloud<10%

Cloud50%

TODAYTODAYGoldman Sachs, “Key Tech Trends to Watch,” Jan, 2010


Why Move? Cost Savings

30-40%

In House CloudIn House Cloud


Our Product Portfolio

MANAGED HOSTING

CLOUDHOSTING

Ability to solve broadest range

f iti lEMAIL &

COLLABORATIONHYBRID

HOSTING

of critical compute needs: Security/Compliance Cost driven Core Apps Architecture driven


The Right Tool for the Job

Why Cloud?• Speed to market

Why Managed?•Compliance PCI HIPPA • Speed to market

• Unpredictable needs• Easy and rapid scalability• Automation of tasks

•Compliance – PCI, HIPPA, SOX

•Proven model•Reliability and predictability Automation of tasks

• Save money• Lower cost• Pay for what you use

Reliability and predictability•Customizable•Security – Total isolation•Avoid “performance tax”p•Legacy apps

Compliance & regulation evolution

More service models Dedicated form factor

The Cloud evolving to meet complex needs


Rackspace’s Cloud Ecosystem

storagesystems

public cloudssystems clouds

Monitoringtools

privateclouds tools

Managementsystems

specializedclouds


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