We had to prove ourselves," Ziegler said. It's not like Amazon was dying to have this former competitor as a partner.
LOGICWORKS CEO PLUS
Most of that growth is around AWS," he said.Īnd capital expenditures (CapEx) "went from around 25% of revenue down to less than 6% of revenue over the last four years." Plus earnings before interest, taxes, and amortization "went from neutral to several million dollars," he said.īut, there was another issue. "The company took 20 years to get to $12 million and three years later we're approaching $50 million. The bonus: this was a less expensive, more profitable business than hosting.
LOGICWORKS CEO SOFTWARE
So the company built a software product that helps companies manage their AWS usage and that software business took off. It dawned on him, instead of fighting the shark in the water, he needed to join forces with it. "I was watching our salesforce just get punched in the face every day trying to sell our infrastructure over AWS," he said.Įven the company's own engineers were looking at AWS and saying that "Amazon was superior technically" to Logicworks. You were still growing your installed based off traditional hosting, but it became more and more obvious that AWS was going to eat the lunch of so many incumbent providers," he said.
"The traditional hosting industry was at a terrifying moment back in 2011-2012. Ziegler looked around and realized that Amazon Web Service was slowly killing his business.ĪWS was just hitting its stride, moving past its reputation as cheap app hosting for startups. (Amazon Web Services CEO Andy JassyAmazon)Ībout five years ago, Logicworks was still a classic hosting company. "There was so much equity available, it wasn't a toxic investment. But because Logicworks hadn't been raising rounds and rounds, stockholders were not diluted, either. No single person cashed out and got rich from this $135 million, we understand. Many of his managing team had been with the company for years, too. Ziegler joined the company in 2001 as a salesperson, worked his way up to CFO, COO, and then CEO in 2014. The founder had long ago left daily management (though he still had a stake). Logicworks had actually gotten multiple offers at the same price/terms, he said, but Pamplona was doing this as more of an investment than a buyout, keeping existing management in place. They basically scoured the earth, looking for someone that had a recurring software revenue model around Amazon Web Services," he said. Pamplona won the company's hand because they "had been very aggressive looking at different partners in the eco-system. We didn't even know where it was going to go." "The best time to look is when you have a lot of interest.
It got to the point where myself and the management team, we couldn't possibly keep up while trying to run the business," Ziegler said. "We ran a formal process to explore options for the business because we had so much inbound activity from the biggest private equity folks to Fortune 500 companies.
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