At TechNode’s Collide: Powering the China Cloud Conference, I chatted with James Eron, the COO of ChinaNetCloud. The company specializes in server management and cloud Computing  for internet and game companies in China.

The cloud is the limit

The company now has over 50 staff and 150 clients so far with revenue growing 100% YOY,  showing the huge demand for cloud server management services. Although currently privately funded, they are now looking to raise US$3-5 million in a series A investment, according to CEO Steve Mushero.

ChinaNetCloud primarily focuses on Infrastructure as a service where Amazon in America and Alibaba in China are dominant players. “Effectively we give you a virtualized server system to put your application on and you can move it different clouds or providers, so it’s all on  an open platform.” said James.

China businesses should have servers in China

James believes for start-ups, cloud computing is great way to test things. But you should first find out if the servers are where you need them to be. If your users are in China, your cloud server should be in China, “an Amazon server in Singapore or Japan is not going to help you much.”  For companies starting out, James thinks the question has become “why not go to the cloud?”

Cloud computing is cheaper and more scalable

Cloud servers have the advantage of being typically cheaper than buying your own hardware.  Billing is often monthly or quarterly, so helps cash flow for a start-up. The cloud is also very flexible where you “you never have to buy more than you need.”

ChinaNetCloud is also able to create a private cloud by taking physical servers and create a cloud layer on top. The other benefit of cloud computing is its ability to scale at speed, typically from a few minutes for a public cloud to a few hours for a private cloud.

Cloud computing will only get bigger

More and more cloud services are being offered in China. James sees in the future, “it will be difficult to buy physical servers, because nearly everything will be moved to the cloud.” This is great for companies that want to convert hardware costs from a capital expense to more operational value adding expenditure.

Start-ups should consider server management early

When interviewing James, I got a great sense of his passion for start-ups and how willing he is to support them make early but critical decisions about how to set up a cloud management system. He shared some experiences where start-ups didn’t realize how important server management was to the performance of a sites traffic and ultimately the user experience. One case he remembers, led to a start-up losing a major deal because the site outage was too frequent. So if you’re a start-up, think about how this will impact you and plan early.

Jason is an Australian born Chinese living in Beijing, specializing in entrepreneurship, start-ups and the investment eco-system in China, especially in the tech and social area.

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