Plug-and-Play Cloud Storage At Home: Cloud Engines CEO Daniel Putterman (Part 7)

Sramana: What was your run rate after you began channel deals?

Daniel Putterman: If you look at the run rate from October through the end of the year, it becomes clear that the channels put us on the map and everyone got excited about the product. Every time a Pogoplug customer buys a device, they create a personal cloud. That allows them to share the video and photos with their family on their own terms. The average Pogoplug customer will get between 5 and ten other people to join the Pogoplug service even though those new members do not buy the device. That is very viral.

We are a service that ended last year with millions of users and over 30 petabytes of storage under management. We are just scratching the surface. If you think about the way Pogoplugs work, we are creating a huge cloud.

Sramana: Do you view yourselves in competition with Shutterfly?

Daniel Putterman: We will happily let them print. We like to carve things out. DropBox allows you to have perhaps 5 gigabytes free, which is great, but if you are talking about a terabyte then you are talking about thousands of dollars a year. The upload speeds can’t keep up with that either. There is a place for cloud storage companies. I use about five of them. When it comes to the bulk of my storage, I use Pogoplug for that. It is storage, streaming, and backup.

Sramana: If I want to use Shutterfly in conjunction with that I could do so?

Daniel Putterman: Absolutely. You can share from our software. We see Shutterfly as an ecosystem partner. We think users will print great photos through their service.

Sramana: How do you position against cloud media servers like the RealNetworks product?

Daniel Putterman: The RealNetworks solution is interesting. You are acquiring commercial content online. We see Netflix as a streaming only company. We focus on personal content. With all the PCs, digital video recorders, and cameras, we anticipate 9 terabytes of storage in a home in the next five years. Of those 9 terabytes, four will be for personal content. We don’t anticipate competing against commercial content services.

Sramana: What was the PR campaign that you ran for the product and the Best Buy deal?

Daniel Putterman: All we have done for marketing is PR. We will run a special for a weekend every now and then. Fundamentally, there is no radio spot or TV spot. Until one can reach a serious amount of scale, PR is probably the best route. Tivo spent over $200 million for their Super Bowl ads. The money was there for them back then.

Sramana: I think it depends on the size of your company and the category in which you are doing business. Search engine optimization and PR are more effective ways of marketing.

Daniel Putterman: We have recently embraced putting ourselves out there in any way possible. We will get on the local news for issues such as payroll taxes. That still gets our company exposure. You can make exposure more than just the product. I am talking to you here because I have fun talking to you and it will be good for business as well. You also have a way of drawing things out of people that the average journalist won’t.

Sramana: The kind of work we do and the kind of content we produce matches our content. It will not appeal to 9 million people like TechCrunch does.

Daniel Putterman: The dream of business people around the world is to come to California and become a tech entrepreneur. Entrepreneurship is not taught in school.

Sramana: That is what 1M/1M does. We have built that curriculum at a very affordable price.

Daniel Putterman: I get it. It makes a ton of sense to me. You have credibility because of the types and sizes of companies showing up to do interviews with you.

Sramana: The threshold for Entrepreneur Journey stories is $10 million in revenues.

Daniel Putterman: I’m glad we made it!

Sramana: As am I. Thanks for your time; this has been a great story.

This segment is part 7 in the series : Plug-and-Play Cloud Storage At Home: Cloud Engines CEO Daniel Putterman
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