• Jack Fleming

Ep #25 - CEO - Cloud, Connection, and Colocation | Paul Szurek | CoreSite

Jack Fleming 3:36

Hello and welcome to the process of profit podcast. My name is Jack Fleming. It's a podcast focusing on marketing, business and entrepreneurship. I'm here today with CEO Paul Szurek how are you today, Paul?

Paul Szurek 3:49

Great. JACK, how are you doing?

Jack Fleming 3:50

I'm fantastic. I'm fantastic. So to give the crowd a little bit of insight, Paul is my friend's dad. So I met him way back when when we're all in Asheville, and now we're all I guess somewhere else. Now. Before I jump into it more, I want everyone to know that this podcast is brought to you by entre a new professional network built for entrepreneurs, investors, creators and freelancers. You can easily create content, grow your network and meet new like minded people in live rooms and events on the app. All listeners can sign up for free, and also get upgraded to entre Pro, which gives you access to over $50,000 in deals and discounts with over 100 partners. Once you sign up for entre, entre dot link backslash jack to get your free entre account. And make sure you check with me at jack does marketing. I'll see you on it. Sweet so why don't we start out by doing a little background on I guess who you are, how you became CEO. Let's start from like what you studied in college and then I guess job developments and then nursey Yep, let's start there.

Paul Szurek 4:58

Sure. Great. Thanks for thanks for having me on jack. So, so I'm a military brat, went to college and studied government of all things. I graduated in a year when the economy 1981, when the economy was really, really bad, even worse than this last great recession. And so I did what a lot of people did, I went to law school, instead of going out and testing the job market. And in graduate from law school, and actually while I was there, I started working with companies and doing corporations law, mostly selling securities, doing financings initial public offerings, all that kind of activity, which is a great way to learn business because you have to delve into all the details of your of your customers, if you're going to be going to be effective in in helping them raise money, and the merge and do things like that. I actually really enjoyed the practice of law. But I did it for about six and a half years, but always had this kind of, I frequently left meetings, thinking that the clients, the business, people were having more fun, and, and also thinking that I'd learned a lot from them. And maybe I wouldn't be a bad business person, myself. And then in in 91, I was approached by somebody who was starting up an organization that would play a was envisioned and ultimately did play a major role in the real revitalization of the Rei t industry. Real estate investment trusts. It's a it's a publicly traded way for investors to invest in real estate on the same basis that wealthy individuals can invest directly without an additional tax burden. Except that you can achieve scale and be professionally managed. So I spent 11 and a half years with that company. We took we created or revitalized several real estate investment trusts, some of which are still among the largest Rei T's in the in the world today. And then our organization was bought out by GE Capital in 2003. I'm sorry, 2002. And then like 2002, I came to Asheville, and started doing masterplan communities and private real estate development with the good great company got more farms here in Nashville? Oh, yeah. And then about five years ago, I, you know, I did. In 2010, I started going back serving on corporate boards. One of the companies I was on the board of was Coresight. And about five years ago, when, when we had a CEO deciding that he wanted to get out of the public company space. I was asked by the rest of the board to be CEO and I've been CEO for the last five years.

Jack Fleming 8:17

Awesome. Awesome. That's a lot. shutters. I'm hearing law, you've been on boards, being real estate, CFO or CEO. So you definitely have a lot of business is business leadership under your belt? How has what did you learn from developing development of these positions? So I obviously each ages for slightly higher up than the other. Definitely CEO, CFO to CEO is definitely a lot higher up position, what have you learned that as transferred over from position to position

Paul Szurek 8:52

they are, the most common element is that you, you have to look for a purpose you have to look for, where you can help people create, value and contribute value. That you know, honestly, that's why real estate is one of the most satisfying occupations and a lot of people enjoy it. Because unless you're, you know, a pretty bad real estate developer. Everything you build will be put to good use by somebody. But you can also move up the value chain and make buildings and communities really ideally, or develop communities like even in the data center business. Our business is built around communities of companies that interoperate and exchange a lot of data with each other on on these massive data center campuses. But, you know, the more valuable The more you can make your real estate, something that people want to use, because it's more than just four walls. rufe the better off you are. Now, that doesn't always mean doing the most expensive thing like apartment developers who can provide really functional clean, you know, energy efficient apartments at an affordable level. They're creating just as much value as the people who are building Taj Mahal apartments. But you just got to figure out where to where do you create value even in even in my CFO role, a big part of that was information technology. And, you know, the this was the early days, the 90s. But even then, that's when companies like ours started using techniques that are now referred to as cloud in order to make people's work easier. So for example, our organization supported 6000 property managers, who spent about 12 hours of their 40 hour average workweek doing paperwork. So we figured out how to make that task, as easy as ordering a book off of amazon.com, which coincidentally had started off pretty recently than two. Yeah. And in the process, we reduced the amount of time they had to spend doing paperwork to about two hours a week, which freed up 10 hours a week to take care of their customers to get new customers to make sure the facility that they were running was in good shape. To really to really do more fun things and more valuable things with their job. So whatever, whatever your job is, look to look for ways to add new value, have a purpose of making, you know, the users experience better? And and the rest seem to take care of itself? You do. I say the rest team needs to take care yourself. If you want to do that, well, you gotta mind your P's and Q's, you got to be financially solvent, you got to plan financially, you have to have resources and liquidity. And you need to you need to avoid wasting resources, you know, spending money on foolish or vain or ego driven activity.

Jack Fleming 12:24

Have you ever done that? Have you learned to do that? I guess I'm assuming you've learned to do that over the years to offer that as a tip. But I mean, that's just that is general knowledge as a business professional and CEO is to manage finances, but have their have How have you learned that?

Paul Szurek 12:42

So? You know, honestly, yeah, it is, you know, we all all you got all the business. Students learn budgeting, they learn finance, they learn financial planning and analysis. But there's a real difference between working from a recipe, and actually cooking and tasting things as they go along. And as good as our university professors and academics are, it's just impossible to replace the experience on the ground. I would say too many, you know, the biggest thing I had to overcome, I was a pretty typical finance person, but not totally typical, because I'd started off as a lawyer, but, you know, I, I took the cost structure, and where those costs were spent, which is as important as the cost structure itself, I kind of took it for granted, you know, I kind of tried to manage it at the margins and keep budget increases at certain levels. And it wasn't until about 18 months into my my tank for tenure as a public company, CFO, that I just felt like I was Failing that, that there had to be bigger moves to make. And fortunately, I didn't have to figure it out on my own. I had a great group of colleagues with me working with me at security capital. And we started figuring out, you know, where can we spend money and our resources in ways to get more value and you know, this this moving moving to this changing our it platform to replace paper with digital work and using a cloud instead of deploying computers, as many computers and servers all over the world. Those are the sorts of things that they created value. And and for the investment that we made, they're much more valuable, but you you have to go in with that kind of willingness to make to make changes which did not come to me naturally because I was a lawyer and lawyer everyone who goes into law I'm pretty convinced, does it because inherently, they're risk averse. Yeah. You know, it's it's a good profession to go into if, if you're like that. I was I was definitely that way, man. I'm you When I left college I had about two nickels to rub together. And that's it. So you tend to be conservative and I had to shake myself out of conservatism. I had to, I had to get to where I enjoyed waking up in the morning and wondering, you know, what big thing, why might we change today, but also developing the discipline not to change for change sake, and to manage change? Well, which is also something, you can only learn by making a few mistakes as you try it the first time.

Jack Fleming 15:29

Yeah, I'm definitely pretty in touch with the lawyer and the risk thing, but my dad's still doing law over here, being an entrepreneur, so I get to chat with him a lot about that, um, one of my questions was gonna be the industry shift, obviously, going from CFO of a more of like a commercial development group. I just, that's where I think for firms is to now a data management, I bet you, you do say you, you're using the data management principles already in cloud computing principles already as a CFO? Did you have to learn any more things? I mean, it seems like it's a completely different industry.

Paul Szurek 16:11

So just to give you I mean, I've really been fortunate to have a great diversity of experience in my career, and every part of it, I've learned something new. I was actually first recruited to be a CEO of a private data center company in 1999.

Jack Fleming 16:29

Okay, wow, okay,

Paul Szurek 16:30

I didn't I didn't take it at the time, because I had, I had a more attractive opportunity going on. But, but so the part of the data business that I'm in is the real estate side of it. Again, it's much more than real estate. You know, because it requires a certain type of real estate that's constantly evolving in terms of what's in the buildings, what are the buildings, like how much security is around them, your cooling and power infrastructure, and the way you staff and train and operate your data centers, is highly technical. And, and a lot of hard work requires really good people to do that. And it's also the way we run the business. And again, you know, you pick something up, you learn something everywhere. In a bit more farms, I was very fortunate to work with a colleague, jack sessile, who was just ahead of his time, in terms of applying the principles of community building, to real estate development. And in the process, if you know, what was what became very obvious were the tremendous synergies that exist in community that are not as they don't exist as much in single property types. My former company kind of focused every every Rei T, we took public with partly successful because they focused on a particular type, now they have all evolved to try to incorporate the community concept in terms of where they locate and how they design properties. But that was a really valuable insight. And remember, I was I've been on the board of Coresight, since 2010. So working with some really great directors, it became obvious to us that there would be power in developing these interconnected data center campuses, that would operate as, as communities of companies that that, you know, in ways share their digital technology use each other's digital technology, whether it's networking, cloud services, security server, cybersecurity services, and things like that. It's really great.

Jack Fleming 18:53

Yeah, that's interesting. My questions on sort of what are like, co locations and, and all this data management, I'm, I suppose, I guess, think of it more as the technical, technical, logical term like API, and a lot of people have like open API now. And so they're building their software's send that out literally, like other people can use that same similar software as well, too.

Paul Szurek 19:15

Right. So that's very important for us, going back to the interconnection element I just talked about. There's probably on the campuses like ours, there's probably as much data exchanged on those campuses, and there's, you know, there's maybe 150 200 of them in the world, maybe maybe 10 or 15 of them in the United States, there's probably more data exchanged within those campuses, then, you know, where is as much or almost as much as is exchanged across the entire internet? Wow, because this is where the super users of data, you know, change data for efficiency. So, you know, Again, we we talked earlier about one of your goals is to constantly make people's lives, your customers, especially in your employees lives easier. So think about, think about, you know, the old Lily Tomlin character, the phone operator, you know, used to be, you would make these connections in these data center campuses, literally, here's a port on the customer server, you plug fiber in there, here's a port on a network server, you plug fiber in there, or in a in a switch, then then goes to a network server. But that's, that's pretty slow. Some people still prefer to do it that way, if they know, they're not going to move things around a lot, because it's pretty, pretty secure. And, and powerful. But more and more customers, we have something that's called an open cloud exchange. And it it's based upon API's between major cloud providers and networks, and enterprise customers, so that enterprise customers can very easily go into our open cloud exchange, and pick up a port with Microsoft or, or or Amazon, Azure, Amazon, AWS, Google Connect Oracle, even IBM SoftLayer. And others and and very quickly start exchanging data with them. And they, and they can do it, you know, basically, in real time, most of its automated, doesn't require any special networking expertise for the customer. And if they decide they want to switch or add other players, they can do that, again, through the same same digital interface. So yeah, that's really cool. And that's something that will continue to be developing elements. So that concept of how companies connect together, probably never stop. So that for more and more enterprises connected with more and more companies, we can make that easier,

Jack Fleming 21:58

huh? Yeah, that's really cool. Every time you say cloud, I think of Facebook. Apparently, when one of their data centers, it was like hot and cold in in there to where a cloud actually formed inside their building.

Paul Szurek 22:14

Yeah, yeah. see that happening? That doesn't sound like great humidity management. But no, I'm sure they got that correct very quickly. But it's a good insight in that, you know, we use terms like cloud, but the cloud is actually a lot of metal. It's a lot. It's a lot of servers all over the world.

Jack Fleming 22:40

Yeah, we think of cloud just being like out there, you're just putting it in stored somewhere. But I guess this is what like Google Drive is, this is what I guess Dropbox is? Or we're putting these files online in places, but they're actually having to go somewhere else to be actually stored there.

Paul Szurek 22:56

Yeah, they're, they're stored. They're stored in physical servers.

Jack Fleming 23:01

Sweet, sweet. Um, so a lot of my audience, I think, probably my age. But I have a mix of people. But when people are, let's say, thinking about becoming an entrepreneur, or you know, have goals as being a CEO, ie, like, I would love to become a CEO of a global company. You know, I'm working on it with my marketing company, I guess. But, uh, what are some steps? You can tell younger people? I guess how to get there? I guess it's probably a lot of hard work. But even even the title of CEO of a global company, does. Do you feel like the weight of multiple people from different countries? Or like, depending on you, versus maybe the CEO of just a company within the United States? Or is there a difference? Or do you feel anything from that or?

Paul Szurek 23:53

So let me let me clarify our customers, our customers can go globally, interconnection facilities and our cloud and network partners that we have on our campuses, all of our data center campuses are in the United States. Okay. But But I don't know that it I'm sure they're, they're recording. My peers that have global platforms require more, you know, staffing and guidance around international risk management, political risk management, currency risk management issues. And so that does make that job significantly more challenging. But I think regardless, if you're a public company, CEO, there's a lot of visibility, a lot of scrutiny. And frankly, more importantly, many people depending on you, customers, employees, shareholders, pension funds, you know, individual retirement accounts. I mean, it's just a, you know, you feel a lot of it, but we're getting back to the your original question. I If you were to base, if I were to base my advice on my career, I would say, don't set a goal to be a CFO, or a CEO. I never did. When I joined, when I moved from law into business with security capital, the only promise I had was that I would be given the opportunity to become a business person and move out of law. And I would say the, the, the most important elements of success is to always be self critical, as much as you can humans, we all have our time with that, continue to learn, be not only receptive, but the higher up you get, be more eager for change to be a positive change agent. And, and honestly work with great ethics. build good relationships with people, which you can't do, if you don't view every relationship as a long term relationship, and what do you have to invest in that relationship and that person to have a long term relationship? So it's it, you know, it's a lot about the same things that everybody does. And just trying to be good humans anyway, the, the, probably the biggest difference, though, is to be be a good learner. a fast learner, a disciplined learner, and, frankly, have the ability to triage, you know, as best as you can, and none of us probably do this better than a, you know, 60 or 70% success level, but, you know, invest your time in the things that, that that the things you can learn that that are going to really make a difference in your ability to do good things do positive change, don't just don't, you know, don't just keep reading and learning, for the sake of it have a goal of, you know, where your business is going, you know, the challenges within your business? Where do you want to look? Is it is it what other companies are doing? Is it new research from, you know, academics is it Do you want to bring in a consultant who will help you learn at a faster pace? You know, you'd but you just got to be you got to be an aggressive and disciplined learner. And you do have to honor and take care of the people that you work with.

Jack Fleming 27:40

I've heard that a good bit is always being a student. Or even that entrepreneurs are firefighters, and that we're like, trying to literally put out fires all day, answering calls. And

Paul Szurek 27:54

so, yeah, I've worked in some entrepreneur, every I think all the spaces I've been in have been pretty entrepreneurial. I've worked with some very entrepreneurial people, they've challenged me and brought me along. But there's a huge difference between the types of organizations I've worked in where there were always a fair amount of resources, you know, not endless, but but you know, good resources and people to apply to a lot of problems. And, you know, we had good baselines of operations, so we could seek incremental changes that were that were less risky to implement, you know, your startup entrepreneur, your startup CEO. I admire them so much, because they're like I heard it described that they're, they're the people that jump off the building and figure out how to open the parachute before they hit the ground.

Jack Fleming 28:45

Yeah. It's a, it's an interesting space to be in for sure. But even if it's like, for me, having a marketing startup and being involved in a lot of other entrepreneurial things in town, it's good just to chat with other business professionals like yourself, who have been in the business world, who are CEOs of large companies, even though it's sort of structured differently, it's not considered a startup, and you got to have a lot more, less risk, possibly, and more. More things that you're on your tool belt. It's It's so good to learn from each other. And obviously, we hope we we sort of admire each other in that way do

Paul Szurek 29:28

No, absolutely. And, you know, I haven't, I haven't totally avoided the possibility of catastrophic failure. At one point in my career. I was sent over to worked in Europe for a couple of years, with the task of taking a company successfully taking a company public on the Amsterdam stock exchange that would invest in us Rei T's and You know, until that until that IPO was successfully completed, and really until we had follow up IPOs. And since it had the stock trade up for about most of those two years, I did live pretty regularly with the possibility of failure.

Jack Fleming 30:16

Hmm, it's a it's an it's a fun, it's a fun thing to live with all the time. But one of my questions I like to, to ask people is making future claims and I know some people don't like to do it. But I think it's, it's, it's cool sometimes. And sometimes people can be very right about certain things that will happen in the future. And I definitely think with with data management, even with like real estate, and and cloud systems that are continuing to develop, as most technology always is, with things like even like crypto out now and that people are having all of these blockchain technology, and all like the exchange of money. People are changing equity and businesses with crypto. Now, there's a lot of interesting things in the works. Do you see any? Do you have any claims for what you see for the for the data in cloud computing? cloud space? And then in the next I say, 10 years?

Paul Szurek 31:16

I don't know if it's 10 years or not, but I think we're I think we're definitely getting to the that, you know, Star Trek like existence where you walk into a room and say, you know, computer broomy a cup of coffee, and the doctor actually asked you, you know, which which coffee bean Do you want today? I think, you know, 5g is going to take a while to roll out. And in right now, there's, you know, there's different views looking at the future as to how many use cases will actually be, you know, justify themselves from a cost perspective with 5g. I just would not bet against and 5g will enable these types of local data intensive

Jack Fleming 32:04

activity like voice Yeah,

Paul Szurek 32:06

well, I mean, it's not just the voice. It's like all the infrastructure to, you know, to make sure your coffee bean dispensers never empty, and to order, you know, but yeah,

Jack Fleming 32:17

that all the machine behind it

Paul Szurek 32:18

and watch all the, you know, watch all the devices, it's really, I mean, initially, it'll start out where factories that want to monitor a million data, points of equipment in their factories, probably can't do that successfully, right now, with Wi Fi, because Wi Fi just can't support that many devices. But 5g will enable millions of devices in that kind of location. But then you're going to need all the data infrastructure along the line to backhaul that data to places where more interesting, valuable things can be done with it. So I think what you're going to see is continuing development of products that will require more immediate service with larger amounts of data for businesses and consumers. It's, you know, I know when Apple first came out with their iPhone, there were skeptics like, how many people really need a phone that does all this stuff? You know, black blackberry already gave us a phone where you could you could call your your buddies up, do your email, and surf the net at the same time? Why do we need this thing that can hold all these other applications that can stream films? You know, they can, they can let you watch sports? And, you know, there's a lot of skepticism. I don't I don't think there's many people in America today who feel they truly can live their life without an with an iPhone without an iPhone, which in some way isn't necessarily great. But there's a lot of useful things you can do with it, huh?

Jack Fleming 33:57

Yeah, I know, people have no Apple Watches too. So even closer, not necessarily in your pocket. Now they're literally just on your watch. And you can you can make calls at all just by raising your wrist instead of having to dig into your pocket it's it's a it's an interesting face to see develop and and see how they continue to develop it because I almost think that this is the pinnacle of the product they can make now and that now they're just developing new the camera behind things that's the only thing being changed about these newer phones is the camera quality.

Paul Szurek 34:27

Well, there's gonna be a lot of changes to the infrastructure. You know, the the cloud will actually pay more and more go into the network and all the way to the tower in terms of companies sharing, you know, bandwidth or companies working together to provide, you know, combined products that enable businesses and consumers and businesses and businesses to interact in a 5g world. With more cost efficiency than what then would be, and more agility than would be available, if, you know if what's currently in the cloud didn't eventually evolve in the network and tower space.

Jack Fleming 35:13

I think it's also interesting to see the whole AI space. And no, I, we talked about a lot of data points. I think that's pretty much what AI is, is they just comb through tons of data points to, I guess, suggest they're the right answers to just the right task for the the technology to perform. I guess we're gonna see that happening even quicker and with even more capacity in the coming years.

Paul Szurek 35:40

Yeah, I mean, you you will, you will see that no doubt. I don't know how fast I don't know what the best use cases were. But I know some people that probably do know, I'm pretty excited about it. Cool.

Jack Fleming 35:54

Well, that's really all I have, I don't want to give a ton of your time, because I know you're CEO, a busy guy. But thank you so much for talking with us. And talking with me. Again, I started this podcast, sort of as a personal thing, because I was already talking with business professionals already and wanting to make it into content for other people. So thank you for being on if you have any calls to action. I know I put your website down below. But if you're on LinkedIn, on LinkedIn, yeah, absolutely.

Paul Szurek 36:23

And and love to engage with with people that you know, that want really want to, you know, think maybe I can help them learn something. But don't overestimate my ability to do that. Because I feel like I'm still stumbling along and learning myself. So

Jack Fleming 36:41

yeah, but even then you have a ton of experience in different fields and, and different positions. And that's what I really wanted to come to today is you know, you have this law, you have financial now you have sort of management side, all at once. And it's really valuable for people wanting to get into just business in general, and so on. So thank you for your insights.

Paul Szurek 37:04

JACK. It was fun being on your show today. And thank you for doing this sort of thing and have a great rest of your day.

Jack Fleming 37:10

Thanks for being on. Take care.

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