20-Year Journey of a Fat Startup with Major Pivots: Scott Sellers, CEO of Azul (Part 3)

Sramana Mitra: How did you spin the Java story?

Scott Sellers: The other two founders worked for a company called Shasta Networks. This was in the late 90s. It was a cable and DSL model termination system. They built an appliance to do this. They put together the hardware and wrote a ton of software to make it all work. In the late 90s, they chose Java inside this appliance. This was on the leading edge in terms of what Java is capable of. They had a really nice outcome by selling it to Redback.

They learned the hard way what’s wonderful about the programming language and the limitations at the runtime layer. Development is great. Once you run Java applications, there are performance challenges and scale problems. What they recognized at that time was how do you solve this Achilles Heel of Java. What we set out to do was to provide products that ultimately would solve some of these deployment production issues.

Sramana Mitra: Very quickly, what was the approach to solve the runtime problem?

Scott Sellers: It has changed over time. We were a hardware company in 2002. We did what entrepreneurs do. We went up and down Sand Hill. We met with a ton of different venture capital firms. The vision was similar to what Cisco did with switching and routing and what NetApp did with storage.

We had this concept that by offloading a major resource of a traditional server and putting it into a purpose-built appliance, you can do wonderful things. In our case, we figured out a way to remove the running of Java off of general-purpose servers and put it on to this purpose-built appliance. That innovation there was built around microprocessors that ran Java code effectively and efficiently.

Sramana Mitra: It was a hardware venture.

Scott Sellers: Yes – chip venture, system venture, to a ton of software. We needed a lot of money. We raised a lot of money. The product that was delivered was a compute appliance that had a 5U form factor. We had a bigger one that was 11U that we could pack hundreds of processors into a very small form factor. That was the first incarnation of a Java computing appliance.

Sramana Mitra: In the Silicon Valley parlance of today, this would be a fat startup.

Scott Sellers: Yes. The only thing we had was ideas and PowerPoint.

Sramana Mitra: Whom did you go to raise the money?

Scott Sellers: We met with various venture firms up and down Sand Hill that either had some relationships in the past or by reputation. It wasn’t that long of a process. Pretty early on, we were able to get the interest of Redpoint Ventures, Accel Partners, and others of that kind of quality. It wasn’t as bad. We met with a couple of dozen and were quickly able to get some interest. The reason is, it was a big bold vision.

Sramana Mitra: It was a big bold vision from entrepreneurs who have done it before. That makes all the difference.

Scott Sellers: Yes, we were coming off of nice exits. We cast some fantastic parallels with Cisco and NetApp. That resonated. It was a quick elevator pitch that was impactful. Coming off of a successful exit, we were in a good spot to raise money from tremendous venture firms.

This segment is part 3 in the series : 20-Year Journey of a Fat Startup with Major Pivots: Scott Sellers, CEO of Azul
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